Karnataka High Court
Mr Naveen Kumar S vs State Of Karnataka on 12 February, 2024
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WP No. 7184 of 2023
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 12TH DAY OF FEBRUARY, 2024
BEFORE
THE HON'BLE MR JUSTICE ANANT RAMANATH HEGDE
WRIT PETITION NO. 7184 OF 2023 (CS-RES)
BETWEEN:
MR NAVEEN KUMAR S,
S/O LATE SHESHAPPA POOJARY,
AGED ABOUT 43 YEARS,
R/AT SARAKERE HOUSE,
IVARNADU VILLAGE AND POST,
SULLIA TALUK, DAKSHINA KANNADA-574239.
...PETITIONER
(BY SRI GOVINDARAJU K, ADVOCATE)
AND:
1. STATE OF KARNATAKA,
REPRESENTED BY ITS CHIEF SECRETARY,
DEPARTMENT OF CO-OPERATIVE SOCIETIES,
VIKASA SOUDHA, DR B R AMBEDKAR VEEDHI,
BANGALORE - 560 001.
2. THE REGISTRAR OF SOWHARDA SOCIETIES
Digitally SOWHARDA SAHAKARI SOUDHA,
signed by NO.68, GROUND FLOOR,
PRAMILA G V
Location:
BETWEEN 17TH AND 18TH CROSS
HIGH COURT MALLESWARAM,
OF BANGALORE-560055.
KARNATAKA
3. THE ASSISTANT REGISTRAR AND RECOVERY
OFFICER CO-OPERATIVE SOCIETIES,
OFFICE OF ASSISTANT REGISTRAR CO-OPERATIVE
SOCIETIES, K R SOU.CO-OPERATIVE
SOCIETIES,
MALLESHWARAM,
BANGALORE-560055.
4. SRI SARASWATH CREDIT
SOWHARDA SAHAKARI LTD.,
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WP No. 7184 of 2023
SULLIA BRANCH, DURGA COMPLEX,
CARSTREET, SULLIA,
DAKSHINA KANNADA-574239.
REG. UNDER CO-OPERATIVE SOCIETIES ACT,
REPRESENTED BY ITS MANAGER.
5. SRI DHARMAPALA,
S/O CHANNAPPA POOJARY,
AGED ABOUT 42 YEARS,
R/AT SHANI MANE, AMARAPADNUR VILLAGE,
CHOKKADI POST, SULLIA TALUK,
DAKSHINA KANANDA-574212.
6. THE TAHSILDAR,
SULLIA TALUK,
DAKSHINA KANANDA-574239.
...RESPONDENTS
(BY SRI SIDHARTH BABU RAO, AGA FOR R1-R3 AND R6
SMT SHRIDEVI BHOSALE M, ADVOCATE FOR R4
SRI M B PRABHAKAR, ADVOCATE FOR R5)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO
QUASH THE CONFIRMATION OF SALE DATED 28.11.2022
BEAIRNG AMALJARI NO.KA.RAA.SOW.SAM.SA.NI./SA.SA.
NI/VA/A/01/2016-17 ISSUED BY THE R3 (ANNEXURE-A) AS
NULL AND VOID AND ETC.
THIS PETITION COMING ON FOR PRELIMINARY HEARING
THIS DAY THE COURT MADE THE FOLLOWING:
ORDER
An auction sale was confirmed on 28.11.2022, in an
execution proceeding which is initiated by the 4th respondent -
bank pursuant to an award under Section 41(4) of Karnataka
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Souharda Societies Act, 1997. The award was passed on
26.02.2016.
2. The present petitioner is one of the legal
representatives of Judgment Debtor no.1. Admittedly,
Judgment Debtor no.1 died on 03.02.2015. The date of death
of Judgment Debtor no.1 is not in dispute.
3. Respondent No.4 - bank proceeded under the
assumption that Judgment Debtor no.1 is alive and filed an
execution proceeding to recover the dues pursuant to the
aforementioned award. The property of Judgment Debtor no.1
was put for auction. The petitioner realizing this, filed a
representation before the 4th respondent - bank reporting death
of his father who is the Judgment Debtor no.1 in the
aforementioned award. The 4th respondent - bank instead of
filing an application to substitute the legal representatives of
deceased Judgment Debtor no.1 proceeded further in the
execution proceeding and put the property of Judgment Debtor
no.1 for auction. The auction was held on 14.09.2022. Then
the sale was confirmed on 28.11.2022. The sale certificate is
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executed and sale is registered on 27.02.2023. The auction
purchaser has purchased the property for Rs.36,60,000/-.
4. Admittedly, the auction purchaser has paid the
registration charges as well as the stamp duty.
5. The petitioner is before this Court on the premise
that the entire Execution proceeding and all other action taken
thereafter to sell the property of the petitioner's father are null
and void. It is also his submission that the award against
defendant No.1 is also null and void as the award is passed
against a dead person. Thus, he would contend that the award
is to be set-aside and the matter has to be heard afresh.
6. Learned counsel for the 4th respondent would submit
that the death of the 1st defendant before the Assistant
Registrar of Co-operative Societies was not brought to the
notice of the 4th respondent- bank when the proceeding was
pending before the said Authority. It is also her contention that
after the award is passed, an Execution Petition is filed and the
petitioner made a representation stating that his father is dead
however, the amount would be repaid and sought time to repay
the amount. It is the contention of the learned counsel for the
4th respondent - bank that acting on the assurance of the
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petitioner, 4th respondent-bank did not immediately proceed
further in the Execution proceeding. However, after realizing
that the petitioner has not repaid the amount, 4th respondent-
bank has proceeded to auction the property in accordance with
law. It is also her contention that the property is auctioned
after giving due notice to all the concerned persons and auction
purchaser has paid the entire bid amount and sale certificate is
issued in his favour. The sale certificate is registered. Thus, it
is urged that the writ petition is to be dismissed.
7. Learned counsel appearing for the auction purchaser
would contend that he was totally kept in darkness about the
death of the original Judgment Debtor. He is a bonafide
purchaser in the auction and his submission is that he has paid
the entire consideration amount, sale is confirmed and sale
certificate is issued and same is duly registered. Thus, he
would pray for dismissal of the writ petition. In the alternative,
he would submit that in case, the Court has to hold that auction
is null and void, the entire sale amount paid by the auction
purchaser along with registration charges and the stamp duty
be refunded to the auction purchaser along with interest.
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8. This Court has considered the contentions raised at
the bar.
9. There is no dispute that the 1st defendant died on
03.02.2015. It is further not in dispute that the award is
passed on 26.02.2016. Admittedly, the legal representatives of
deceased defendant No.1 are not brought on record when the
proceeding was pending before the Assistant Registrar. Even in
the Execution proceeding, despite the bank coming to know
that Judgment Debtor No.1 is dead, no steps are taken to
substitute the legal representatives. This being the position,
the award against Judgment Debtor no.1 is in nullity. The
property auctioned in the Execution proceeding is the property
of Judgment Debtor No.1. Since, there is no award against
Judgment Debtor no.1 in the eye of law, there could not have
been further proceedings to recover the dues from Judgment
Debtor no.1 who was dead by the time the award was passed.
Thus, respondent No.4 - bank could not have proceeded to
auction the property of Judgment Debtor no.1. This being the
position, this Court is of the view that the impugned award at
Annexure - C is to be quashed and the same is quashed.
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10. Since the award is in nullity as it is passed against a
dead person, the Execution proceeding against a dead person is
also in nullity. All further action taken against the deceased
Judgment Debtor no.1 and the auction sale of his property are
also untenable. Accordingly, the auction sale is set-aside.
11. Though, it is urged on behalf of the 4th respondent
that the expenses relating to the registration of sale certificate
and the stamp duty is to be borne by the petitioner, this Court
does not find any justification to fasten the liability on the
petitioner.
12. The award against Judgment Debtor no.1 is in
nullity. The bank has proceeded to auction the property of the
dead person. This being the position, the liability to pay the
expenses and registration charges is on the 4th respondent-
bank. It is also relevant to note that auction has taken place
on 14.09.2022. The auction purchaser has paid Rs.9,15,000/-
on 14.09.2022 and balance amount of Rs.27,45,000/- is paid
on 08.11.2022. Since the auction sale is set-aside, the liability
to pay the said amount is on the 4th respondent-bank.
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13. Since this Court has already observed that the 4th
respondent - bank proceeded to auction the property of a dead
person, the auction purchaser is to be compensated by
awarding interest @ 8% p.a. on the amount paid by him from
the date of payment till the date of repayment. It is also
relevant to state that the 4th respondent - bank shall also bear
the registration charges and expenses incurred by the auction
purchaser. The 4th respondent- bank is also liable to pay
interest @ 8% p.a. on the registration charges and stamp duty
from the date of registration till payment.
14. Though, it is brought to the notice of this Court that
the legal representatives of the deceased were notified before
the auction sale by issuing notice of auction, it is relevant to
note that when the award itself is a nullity as it is an award
passed against a dead person, notice issued before auction sale
to the legal representatives of deceased without impleading the
legal representatives of the deceased Judgment Debtor does
not cure the defect in passing the award. Since the award is
set-aside and award is passed against the dead person, matter
has to be heard afresh by the jurisdictional Assistant Registrar
of Co-operative Societies - 3rd respondent.
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15. Hence the following:
ORDER
(i) The impugned award dated 26.02.2016 marked at
Annexure - C is set-aside.
(ii) The Execution proceeding initiated before the 3rd
respondent in proceeding No.01/2016-17 is quashed.
(iii) The sale deed dated 27.02.2023 is set-aside.
(iv) The sale certificate is cancelled.
(v) The jurisdictional Sub-registrar is directed to make a note
in the encumberance register relating to cancellation of sale
deed dated 27.02.2023 to the effect that sale deed dated
27.02.2023 at Regn.No.BKI/2984/2022-23 is cancelled.
(vi) Respondent No.3 - Assistant Registrar of Co-operative
Societies shall hear the petition afresh.
(vii) The respondent-bank is permitted to implead the legal
representatives of deceased Judgment Debtor no.1.
(viii) The amount deposited by the petitioner pursuant to the
interim order passed by this Court which is said to be deposited
in the bank, the same shall be treated as a fixed deposit from
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today till the decision is taken by the jurisdictional Assistant
Registrar. The entitlement to said amount and interest on it is
subject to the award to be passed in the proceeding.
Sd/-
JUDGE
brn
