Telangana High Court

Chuttubaka Vasantha Rao vs M/S Shriram Chits Private Limited on 25 March, 2025

  IN THE HIGH COURT FOR THE STATE OF TELANGANA

         CIVIL REVISION PETITION No.2161 OF 2024

Between:

Chuttubaka Vasantha Rao and two others.
                                                      ...Petitioners
And

M/s Shriram Chits Private Limited, Kothagudem
Branch, reptd by its Foreman-S.Ramaiah
and four others.

                                                 ...Respondents

JUDGMENT PRONOUNCED ON 25.03.2025

HON'BLE SRI JUSTICE LAXMI NARAYANA ALISHETTY

1. Whether Reporters of Local newspapers :      Yes
   may be allowed to see the Judgment?

2. Whether the copies of judgment may be

   marked to Law Reporters/Journals?       :    Yes

3. Whether her Lordship wishes to

see the fair copy of the Judgment?         :    Yes

                   _______________________________________
                    JUSTICE LAXMI NARAYANA ALISHETTY
                                 2
                                                              LNA, J
                                                  CRP.No.2161 of 2024


  HON'BLE SRI JUSTICE LAXMI NARAYANA ALISHETTY

          CIVIL REVISION PETITION No.2161 OF 2024

% 25.03.2025

Between:

# Chuttubaka Vasantha Rao and two others
                                                    ..... Petitioners

And:


$ M/s Shriram Chits Private Limited, Kothagudem
Branch, reptd by its Foreman-S.Ramaiah
and four others.
                                                   ....Respondents
< Gist:

> Head Note:

! Counsel for Petitioners: Sri Krishna Kishore Kovvuri


^ Counsel for Respondents: Sri N.Srikanth Goud



? Cases Referred:
  1. 2013(2) ALT 283 (DB)
  2. 2013(3) ALT 143 (DB)
  3. 2012 SCC Online AP 536
  4. 2021(3) ALT 469 (TS)
                                  3
                                                                LNA, J
                                                    CRP.No.2161 of 2024


HON'BLE SRI JUSTICE LAXMI NARAYANA ALISHETTY

         CIVIL REVISION PETITION No.2161 OF 2024

ORDER:

The order dated 13.12.2023 passed by the Principal Junior

Civil Judge, Kothagudem in EP.No.21 of 2020 in Arbitration Case

No.449 of 2015 is under challenge in this Civil Revision Petition.

2. Heard Sri Krishna Kishore Kovvuri, learned counsel for

petitioners and Sri N.Srikanth Goud, learned counsel for

respondent No.1. Perused the material available on record.

3. Petitioner Nos.1 to 3 are judgment-debtor Nos.2 to 4

respectively, respondent No.1 is decree-holder, respondent Nos.2, 3

and 4 are garnishees and respondent No.5 is judgment-debtor No.1

before the Executing Court.

4. The facts of the case shorn off unnecessary details are that

respondent No.5 is the subscriber of chit of respondent No.1-

company for a chit value of Rs.5 lakhs payable in 50 months; that

he participated in the chit auction on 16.08.2014 and has become

successful bidder for a sum of Rs.3,12,000/-; that the petitioners

herein stood as guarantors to respondent No.5; that he paid only 14

LNA, J

EMIs in full and part of 15th EMI and became defaulter; that claim

petition was filed before the Deputy Registrar of Chits,

Khammam, vide ARB.No.449 of 2015 for recovery of sum of

Rs.3,81,943/-; that the said authority vide order 06.08.2019, issued

Recovery Certificate; that the said Certificate was transferred to the

Court of Principal Junior Civil Judge, Kothagudem and Execution

Petition in EP.No.21 of 2020 was filed for enforcement of Award

passed in the said ARB Case, by attaching the salaries of the

petitioners; that the Executing Court vide impugned order dated

13.12.2023 issued warrants for attachment of respective salaries of

the petitioners. Challenging the same, the present Revision Petition

is filed.

5. Respondent No.1 filed counter inter alia denying the

allegations and averments made in the Revision Petition and prayed

to dismiss the Revision Petition.

6. Learned counsel for the petitioners would submit that the

Executing Court has no jurisdiction to entertain the EP in view of

Rule 35 of Agency Rules, 1994, which contemplates that a decree

passed outside the jurisdiction of agency tracts shall be forwarded

LNA, J

to Agent to Government concerned. Learned counsel would further

submit that as per Section 71 of the Chit Funds Act, 1982,

Registrar alone is competent to issue Certificate and in the instant

case, the Deputy Registrar of Chits had issued Certificate dated

06.08.2019, therefore the EP is not executable. He would further

submit that as per Section 55 of the Chit Funds Act, decree-holder

cannot file Execution Petition straightaway before the Court

concerned and in fact, it has to be forwarded by the Registrar to the

competent Court. He would further submit that as per Section 29 of

the Arbitration and Conciliation Act, the dispute shall be resolved

by the Arbitrator within a period of one year, whereas in the

present case, the dispute was referred on 29.09.2015 and the

Certificate was issued on 06.09.2019, which is clearly beyond the

period of one year and as such, the EP is not maintainable.

7. Learned counsel for the petitioners to substantiate his

contentions has relied upon the following judgments:-

(1) Puligujju Vasantha Rao Vs. M/s Shriram City Union

Finance Ltd., Bhadrachalam, reptd by its authorised

signatory and another 1

2013(2) ALT 283 (DB)

LNA, J

(2) P.Ramakrishna and another Vs. M/s Shriram City Union

Finance Ltd., Bhadrachalam, reptd by its authorised

signatory and another 2

(3) Order dated 14.03.2023 passed in W.P.No.907 of 2023

8. Learned counsel for respondent No.1-decree-holder inter

alia contended that Section 29A of the Arbitration and Conciliation

Act is not applicable to the instant case since the Award has been

passed by the Deputy Registrar of Chits, as per the Chit Funds Act,

therefore, the objection raised by the learned counsel for the

petitioners is untenable. Learned counsel would further submit that

the State Government issued GOMs.No.260, Revenue

(Registration-1) Department, dated 11.10.2016, appointing several

officers, viz., Additional, Joint, Deputy and Assistant Registrars as

officers empowered to discharge the duties imposed on the

Registrar under the Chit Funds Act. He would further submit the

word 'Registrar' is defined under Rule 2 of the Chit Funds Act,

1982, as per which, an Additional, a Joint, Deputy or an Assistant

Registrar to whom a delegation has been made under Section 61(1)

thereof will be entitled to issue a Certificate of Recovery under

2013(3) ALT 143 (SB)

LNA, J

Rule 55(3) thereof. Therefore, in view of the above G.O., Deputy

Registrar of Chits is competent to issue Certificate of Recovery.

9. To buttress his contentions, learned counsel for respondent

No.1 relied upon the judgment of the erstwhile High Court of

Andhra Pradesh in Pilli Rambabu Vs. Sirasani Srikanth Vinay

Kumar3 and judgment of this Court in Integrated Tribal

Development Agency (ITDA) Vs. M/s Water Health India Private

Limited (WHIN) 4.

10. By relying upon the above two judgments, learned counsel

for respondent No.1 contended that Agency laws are applicable

only to tribals, that too, only in respect of immovable properties

which are part of agency tracts. In the present case, the petitioners

are non-tribals and in fact, only their salary attachment has been

effected, which is no way related to immovable properties situated

in agency tracts, therefore, the grounds raised in this Revision

Petition are not tenable and the Revision Petition is liable to be

dismissed.

2012 SCC Online AP 536

2021(3) ALT 469 (TS)

LNA, J

11. The Agency Rules are the Rules designed to protect the

rights and interests of the tribal communities and the matters

connected with the immovable properties situated within the

agency tracts, to ensure the well-being of the tribals. Further, it is

not the case of either of the parties that any one of the parties to the

E.P. are tribals, more particularly, the petitioners, who are

judgment-debtors. The Agency Laws does not attract the

petitioners merely for the reason that they are residing in agency

area. Further, the salaries of the petitioners, which does not come

within the purview of immovable properties located in scheduled

areas or agency tracts, are directed to be attached by the Executing

Court, therefore, the impugned order does not in any manner relate

to the agency tracts. Therefore, Rule 35 of the Agency Rules does

not attract to the present case.

12. As regards the contention of learned counsel for the

petitioners that the Award was passed by Deputy Registrar of

Chits, it is to be seen that under Rule 2 of Chit Fund Rules, the

word 'Registrar' is defined, which includes an Additional, a Joint,

Deputy or an Assistant Registrar. Further, G.O.Ms.No.260,

Revenue (Registration-I) dated 11.10.2016, empowers the said

LNA, J

authorities to discharge the duties imposed on the Registrar. A

harmonious reading of the above, makes it clear that the Award

passed in the instant case is passed by a competent authority.

Therefore, the contention of learned counsel for the petitioners

regarding incompetency of authority who passed the Award is

negative/untenable.

13. Coming to the contention of the learned counsel for the

petitioners that in view of Rule 55 of the Chit Funds Act, the

decree-holder cannot straightaway file execution petition and it is

for the Registrar concerned to forward the Award Certificate to the

competent Court. Here, it is apposite to refer and extract Section 55

of the Chit Funds Act, which reads as hereunder:-

"Section 55 of the Chit Funds Act, 1982, stipulates that upon a winding-up order or appointment of a receiver, no subscriber can initiate or continue legal proceedings against the foreman for amounts due, except with the Registrar's leave, who may impose terms."

14. In the case on hand, the proceedings are initiated by the

decree-holder against the subscriber and guarantors of the

subscriber of the chit for the default committed by them, unlike the

steps to be taken by the subscriber against the foreman, as per

LNA, J

Section 55 of the Chit Funds Act. Therefore, Section 55 of the Chit

Funds Act is not applicable to the case on hand.

15. In Puligujju Vasantha Rao's case (cited supra), it is a case

where the judgment-debtor is a schedule tribe, whereas, in the

present case, none of the judgment-debtors are scheduled tribes,

therefore, the said judgment is not applicable to the present case.

16. Furthermore, it is pertinent to note that by virtue of Section