No evidence of possession - no injunction = the RDO dated 03.08.1997, marked as Ex.B10, the said order of MRO was set aside and the said appellate order has become final.= In order to prove possession, the plaintiff has strongly relied upon Ex.A6, the order of the Mandal Revenue Officer dated 16.07.1992 whereunder he claimed that the name of the plaintiff is shown to the extent of Ac.0.7 ½ cents in Sy.No.398/3. However, against the said order, the defendants had filed an appeal before the Revenue Divisional Officer and under order of the RDO dated 03.08.1997, marked as Ex.B10, the said order of MRO was set aside and the said appellate order has become final. Other than the said document, the documents filed by the plaintiff are tax receipts, which hardly have any evidentiary value to establish possession and entitled for injunction.

IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH
AT HYDERABAD

FRIDAY, THE TWENTY SECOND DAY OF MARCH

TWO THOUSAND AND THIRTEEN

 

PRESENT

 

THE HON'BLE SRI JUSTICE VILAS V. AFZULPURKAR

 

SECOND APPEAL No.149 of 2013

 

 

BETWEEN

Poola Sakunthalamma.

... APPELLANT

AND

Badiri Narayana and nine others.

...RESPONDENTS

 

Counsel for the Appellant: MR. P. VEERA REDDY

 

Counsel for the Respondents: --NONE APPEARED--

 

The Court made the following:

JUDGMENT:

         

This appeal is by the plaintiff against the concurrent judgments of both the Courts below wherein the plaintiff’s suit, being O.S.No.433 of 1994, for injunction was dismissed under judgment dated 31.08.2004.

2.       While the plaintiff claims to be in possession of the suit schedule property and sought perpetual injunction against the defendants,
the defendants disputed the plaintiff’s title as well as possession.
In order to prove possession, the plaintiff has strongly relied upon Ex.A6, the order of the Mandal Revenue Officer dated 16.07.1992 whereunder he claimed that the name of the plaintiff is shown to the extent of Ac.0.7 ½ cents in Sy.No.398/3. However, against the said order, the defendants had filed an appeal before the Revenue Divisional Officer and under order of the RDO dated 03.08.1997, marked as Ex.B10, the said order of MRO was set aside and the said appellate order has become final. Other than the said document,
the documents filed by the plaintiff are tax receipts, which hardly have any evidentiary value to establish possession and entitled for injunction.

3.       The trial Court, on consideration of the matter, came to the conclusion that irrespective of the weaknesses pointed out by the plaintiff in the case of defendants, the plaintiff has to succeed by establishing his possession for being entitled to the injunction as prayed for and since the plaintiff has failed to establish the same,
the suit was dismissed. 

4.       In this appeal, being A.S.No.14 of 2004, before the lower appellate Court also, the appellant/plaintiff has placed strong reliance only upon the title documents, Exs.A1 and A2. However, admittedly, resurvey has taken place and new survey numbers are assigned, which the plaintiff herself is unable to state as to whether the suit land falls under the resurvey. Consequently, the lower appellate Court also declined to grant any relief.

5.       In view of the said concurrent findings, recorded by both the Courts below, I am unable to see any question of law much less substantial question of law to entertain the appeal.

The second appeal is accordingly dismissed as the stage of admission. As a sequel, the miscellaneous applications, if any, shall stand disposed of as infructuous. There shall be no order as to costs.

_____________________

VILAS V. AFZULPURKAR, J

March 22, 2013

DSK

Whether the lower appellate Court was legally justified in driving the plaintiff to file a suit for declaration of title within three months and limiting the permanent injunction granted by the trial Court for the said three months, after having found that the plaintiff was in possession of the suit land? = yes ; When declaration of title arise = when bare injunction is sufficient = Where the plaintiff is in possession, but his title to the property is in dispute, or under a cloud, or where the defendant asserts title thereto and there is also a threat of dispossession from the defendant, the plaintiff will have to sue for declaration of title and the consequential relief of injunction.A cloud is said to raise over a person's title, when some apparent defect in his title to a property, or when some prima facie right of a third party over it, is made out or shown. An action for declaration, is the remedy to remove the cloud on the title to the property. On the other hand, where the plaintiff has clear title supported by documents, if a trespasser without any claim to title or an interloper without any apparent title, merely denies the plaintiff's title, it does not amount to raising a cloud over the title of the plaintiff and it will not be necessary for the plaintiff to sue for declaration and a suit for injunction may be sufficient. Where the plaintiff, believing that the defendant is only a trespasser or a wrongful claimant without title, files a mere suit for injunction, and in such a suit, the defendant discloses in his defence the details of the right or title claimed by him, which raise a serious dispute or cloud over the plaintiff's title, then there is a need for the plaintiff, to amend the plaint and convert the suit into one for declaration. Alternatively, he may withdraw the suit for bare injunction, with permission of the court to file a comprehensive suit for declaration and injunction. He may file the suit for declaration with consequential relief, even after the suit for injunction is dismissed, where the suit raised only the issue of possession and not any issue of title."

reported in http://judis.nic.in/judis_andhra/qrydisp.aspx?filename=9956
HONOURABLE SRI JUSTICE SAMUDRALA GOVINDARAJULU            
Second appeal No.1212 of 1999

05-06-2013

Vegendla Vijayalakshmi and two others......Appellants
                             


Gaddipati Naga Himabindu and seven others.... Respondents


Counsel for the Appellants:Sri N.SreeRamaMurthy

Counsel for Respondents: Smt.K.Lalitha


<Gist :

>Head Note:

?Cases referred:
1. 2004(2) ALD 786
2. AIR 1972 SC 2299
3. 2004(2) ALD 31 (SC)
4. (2008) 4 SUPREME COURT CASES 594    

JUDGMENT:


        Three of the legal representatives of the deceased plaintiff are the
appellants herein.
Subject matter of the suit is an extent of Ac.2.42 cents of
dry land in Nidubrolu village of Guntur District.
Originally the suit land
belonged to one Pamulapati Sundaramma, who died on 22.02.1991.
The first
defendant is daughter of the defendants 2 and 3.
The third defendant is
daughter of the 4th defendant.
Late Sundaramma is wife of brother of the plaintiff and the 4th defendant.
Sundaramma died possessed of the suit property.
The plaintiff contends that Sundaramma bequeathed the suit property to the plaintiff under Ex.A1 unregistered will dated 20.02.1991.
The defendants
contend that Sundaramma executed Ex.X-11 will dated 27.07.1987 bequeathing the  suit property in favour of the first defendant and deposited the said will in sealed cover with the registration authorities to be opened after her death.
It
is the plaintiff's contention that she took possession of the suit property
after the death of Sundaramma.
The defendants also contend that they have been
in possession of the suit property after the death of Sundaramma.
With that
background and with those allegations, the plaintiff has chosen to file the suit
for permanent injunction restraining the defendants from interfering with her
peaceful possession and enjoyment of the suit land; and it was resisted by the
defendants disputing the plaintiff's allegations.
After trial, the trial Court
decreed the suit granting permanent injunction in favour of the plaintiff.
On
appeal by the defendants, the lower appellate Court came to the conclusion that
the plaintiff should have filed a suit for declaration of title; and
 disposed of
the appeal by giving three months time to the plaintiff to file a comprehensive
suit for declaration of title and permanent injunction.  
While disposing of the
appeal, the lower appellate Court limited injunction in favour of the plaintiff
for the said period of three months.  
Questioning the same, some of the legal
representatives of the deceased plaintiff filed this second appeal.
        While admitting this appeal, the then learned Judge of this Court did not
frame any substantial questions of law.
On perusal of record and memorandum of
the second appeal and hearing arguments of the appellants' counsel, I find that
the following substantial question of law arises for determination in this
second appeal:
        "Whether the lower appellate Court was legally justified in driving the plaintiff to file a suit for declaration of title within three months and limiting the permanent injunction granted by the trial Court for the said three months, after having found that the plaintiff was in possession of the suit land?

        It is contended by the appellants' counsel that the trial Court found that
Ex.A-1 is a true will executed by Sundaramma and Ex.X-11 is not a genuine will
and that the said finding of the trial Court was not disturbed by the lower
appellate Court.  The contention that finding as to genuineness of the wills is
not disturbed by the lower appellate Court is not correct, because the lower
appellate Court did not consider the evidence relating to genuineness of the
respective wills and as to title to the suit property and the lower appellate
Court left that question to be open for being determined in a comprehensive suit
to be filed by the plaintiff for declaration of his title for the suit property
and for consequential permanent injunction in his favour.  No doubt, both the
courts below after considering oral and documentary evidence on record, came to
the conclusion that the plaintiff took possession of the suit land subsequent to
death of late Sundaramma and has been cultivating the same.  On the basis of the
said finding as to possession, the appellants' counsel contended that when the
plaintiff has got settled possession of the suit land, the lower appellate Court
should have granted permanent injunction in favour of the plaintiff.  It is
further contended by the appellants' counsel that limiting granting of permanent
injunction for a period of three months only is not provided by law and it is
contrary to decision of this Court in DAKKILI SIVA NARAPA REDDY v. GADDAM  
PENCHALA REDDY1.  The lower appellate Court came to the conclusion that in his
opinion, in whom the title for the suit property vests in between the parties
has to be determined in appropriate proceedings and till then neither the
defendant can be held to be the true owner nor the plaintiff can be treated as a
trespasser.  Therefore, even without determining as to who out of the two
parties is the true owner of the suit land, the appeal was disposed of by the
lower appellate Court.  It is only to preserve status quo of possession of the
plaintiff of the suit land, which possession is to be determined as lawful or
unlawful, the lower appellate Court protected possession of the plaintiff for
three months during which time the plaintiff was directed to file a
comprehensive suit for title and permanent injunction.  Therefore, this is not a
decree by the lower appellate Court of granting permanent injunction only for a
limited period.  Even protection of possession of the plaintiff of the suit land
for a period of three months by the lower appellate Court is by way of grace and
not as a matter of right of the plaintiff.  It will not clothe the plaintiff
with a right to continue to have permanent injunction in her favour for ever,
without determination of respective titles of both the parties for the suit
land.
        It is contended by the appellants' counsel that when the plaintiff is
found to be in possession of the suit land by the date of filing of the suit in
the trial Court, the plaintiff is entitled for permanent injunction in her
favour and that it is for the defendants to approach proper Court seeking
possession thereof by filing appropriate suit for declaration of title and
possession.  But, the legal position set out by the Supreme Court is otherwise.
In M.KALLAPPA SETTY v. M.V.LAKSHMINARAYANA RAO2, the Supreme Court in          
categorical terms held as follows:
        "The plaintiff can on the strength of his possession resist interference
from persons who have no better title than himself to the suit property.  Once
it is accepted, as the trial court and the first appellate court have done, that
the plaintiff was in possession of the property ever since 1947 then his
possession has to be protected as against interference by someone who is not
proved to have a better title than himself to the suit property."
     

The question of the plaintiff who is in possession of the suit property being
entitled for permanent injunction against the defendant arises only in case it
is found that the plaintiff has got better title than that of the defendant.  In
the case on hand, the lower appellate Court declined to consider the question of
title and as to who out of the two parties has got better title and directed the
plaintiff to file a comprehensive suit for declaration of title and for
permanent injunction.  In the absence of a finding as to the plaintiff having
better title to the suit property than that of the defendants, the question of
the plaintiff being entitled for permanent injunction against the defendants
will not arise at all.
        The appellants' counsel placed reliance on RAME GOWDA v. M.VARADAPPA      
NAIDU3 of the Supreme Court and contended that when the plaintiff is found to be
in settled possession of the suit land, then the plaintiff is entitled for
permanent injunction against the defendants.  The Supreme Court ultimately held
as follows:
        "In the present case the Court has found the plaintiff as having failed in
proving his title.  Nevertheless, he has been found to be in settled possession
of the property.  Even the defendant failed in proving his title over the
disputed land so as to substantiate his entitlement to evict the plaintiff.  The
trial Court therefore left the question of title open and proceeded to determine
the suit on the basis of possession, protecting the established possession and
restraining the attempted interference therewith.  The Trial Court and the High
Court have rightly decided the suit.  It is still open to the defendant-
appellant to file a suit based on his title against the plaintiff-respondent and
evict the latter on the former establishing his better right to possess the
property."

        It is further pointed out by the appellants' counsel that the Supreme
Court observed that where in a suit for declaration of title and injunction,
title is not clear, the question of title will have to be kept open without
denying the plaintiff's claim for injunction in view of the fact that the
plaintiff has been in possession and there is nothing to show that the plaintiff
has gained possession by any unfair means just prior to filing of the suit.

        This is not a case where one of the two parties to the suit have been the
original owner and the other party has gained possession of the suit land by
unfair means just prior to filing of the suit in the trial Court.  In this case,
the suit land belonged to one late Sundaramma who died on 22.02.1991 possessed
of the suit property.  Ex.A-1 unregistered will in favour of the plaintiff is
two days prior to her death.  Ex.X-11 deposited will in favour of the first
defendant is of the year 1987.  It is only after the death of Sundaramma in the
year 1991, the plaintiff came to be in possession of the suit land.  Since then
there is scramble for possession as well as scramble for title of the suit land.
It is contended by the respondents' counsel that there cannot be any dispute as
to genuineness of Ex.X-11 in favour of the first defendant, since it was a will
deposited by the deceased herself with the registering authorities during her
lifetime and since the said will Ex.X-11 was referred to in Ex.A-1 unregistered
will being relied upon by the plaintiff.  Truth and genuineness of Ex.A-1 and
Ex.X-11 are matters to be comprehensively decided by an appropriate Court in an
appropriate suit to be filed by the plaintiff for declaration of his title and
for consequential permanent injunction.  When there is no definite finding as to
title on the basis of respective wills relied upon by both the parties, it
cannot be said that the plaintiff is entitled for permanent injunction against
the defendants.

        It is contended by the appellants' counsel that the lower appellate Court
having found the plaintiff in possession of the suit property should have
granted permanent injunction in her favour and should have directed the
defendants to file a suit for declaration of title and for possession instead of
directing the plaintiff to file a suit for declaration of title.  The
respondents' counsel placing reliance on ANATHULA SUDHAKAR v. P.BUCHI REDDY4 of      
the Supreme Court contended that when there is dispute of title of the
plaintiff, the plaintiff in all fairness should have filed the suit for
declaration of title together with the relief of permanent injunction.  It is
pointed out by the respondents' counsel that even prior to filing of the suit in
the trial Court, each of the parties filed their respective caveats in the trial
Court asserting their respective titles and in those circumstances, it is more
incumbent on the plaintiff to file a comprehensive suit for declaration of title
and for permanent injunction.  When there is dispute as to title for the suit
property which dispute is antecedent to filing of the suit in the trial Court,
it is incumbent for a plaintiff to seek declaration of his or her title before
claiming relief of permanent injunction.
The Supreme Court in ANATHULA SUDHAKAR  
(4 supra) analyzed several situations of this nature and held as follows:
        "The general principles as to 
when a mere suit for permanent injunction will lie, and 
when it is necessary to file a suit for declaration and/or possession with injunction as a consequential relief, are well settled.  
We may refer to them briefly.
        Where a plaintiff is in lawful or peaceful possession of a property and such possession is interfered or threatened by the defendant, 
a suit for an injunction simplicitor will lie.  
A person has a right to protect his possession
against any person who does not prove a better title by seeking a prohibitory injunction. 
 But a person in wrongful possession is not entitled to an injunction against the rightful owner.
        Where the title of the plaintiff is not disputed, but he is not in
possession, his remedy is to file a suit for possession and seek in addition, if necessary, an injunction.  
A person out of possession, cannot seek the relief of
injunction simplicitor, without claiming the relief of possession.
        
Where the plaintiff is in possession, but his title to the property is in dispute, or under a cloud, or where the defendant asserts title thereto and there is also a threat of dispossession from the defendant, the plaintiff will have to sue for declaration of title and the consequential relief of injunction.
Where the title of the plaintiff is under a cloud or in dispute and he is not in possession or not able to establish possession, necessarily the plaintiff will have to file a suit for declaration, possession and injunction.
        We may, however, clarify that a prayer for declaration will be necessary only if the denial of title by the defendant or challenge to the plaintiff's title raises a cloud on the title of the plaintiff to the property.  
A cloud is
said to raise over a person's title, when some apparent defect in his title to a property, or when some prima facie right of a third party over it, is made out or shown.  
An action for declaration, is the remedy to remove the cloud on the
title to the property.  
On the other hand, 
where the plaintiff has clear title
supported by documents, if a trespasser without any claim to title or an interloper without any apparent title, merely denies the plaintiff's title, it does not amount to raising a cloud over the title of the plaintiff and 
it will not be necessary for the plaintiff to sue for declaration and a suit for injunction may be sufficient.  
Where the plaintiff, believing that the defendant
is only a trespasser or a wrongful claimant without title, files a mere suit for injunction, and in such a suit, the defendant discloses in his defence the details of the right or title claimed by him, which raise a serious dispute or cloud over the plaintiff's title, then there is a need for the plaintiff, to amend the plaint and convert the suit into one for declaration.  
Alternatively,
he may withdraw the suit for bare injunction, with permission of the court to file a comprehensive suit for declaration and injunction.  
He may file the suit
for declaration with consequential relief, even after the suit for injunction is dismissed, where the suit raised only the issue of possession and not any issue of title."

        In the light of the above pronouncement of the Supreme Court and in the
light of facts of this case which cast cloud on the plaintiff's title to the
suit property, it is all the more necessary for the plaintiff to have filed the
suit for declaration of title.
Apart from casting of cloud on the plaintiff's
title, in this case, there are respective claims for title for the suit property
by both the parties resulting in scramble for title as well as possession of the
suit land.  
In those circumstances, the lower appellate Court is justified in
law in directing the plaintiff to file a suit for declaration of title before
claiming the relief of permanent injunction, inspite of the plaintiff being in
possession of the suit property by the date of filing of the suit in the trial
Court.  
The substantial question of law is answered accordingly.

        In the result, the second appeal is dismissed with costs.

        ________________________________  
SAMUDRALA GOVINDARAJULU, J.      
05th June 2013

Enhancement of compensation for Rs.75,000/- in which lower court refused to enhance the market value from Rs.41,000/- per acre = escalation of 10% in the market value for each year= If Ex.A.1 which is dated 21.03.1986 under which Ac.0-50 cents of land was sold at the rate of Rs.50,000/- per acre and even an escalation of 10% in the market value for each year, the market value can be arrived at Rs.73,000/- and odd per acre. ; Deduction of 1/3 rd rejected = deduction of 1/3rd would be warranted only when the claim of land owners is based on square yard basis, in which case before they can offer the land for sale they are required to expend money and develop the land, and in that process there is an element of deduction in the saleable land and also expenditure involved in development. However, this is not the case where the land is being acquired on acreage basis by paying lump sum compensation on per acre basis. In the light of the above discussion, we reject the contention of the learned Government Pleader that there needs to be 1/3rd deduction considering the fact there is general spiralling of land prices, we feel it just and reasonable to fix the market value payable as Rs.75,000/- per acre.= It is needless to mention that the appellant would be entitled to all statutory benefits including interest on solatium and additional market value.

reported in http://judis.nic.in/judis_andhra/qrydisp.aspx?filename=10152
HON'BLE SRI JUSTICE K.C. BHANU AND HON'BLE SRI JUSTICE CHALLA KODANDA RAM                

APPEAL SUIT No.361 OF 2002    

18-07-2013

Smt. Tangirala Radhakrishnamma...Appellant-Claimant

The Revenue Divisional Officer,Tenali, Guntur District  ...Respondent-
Referring Officer

Counsel for the appellant: Sri V.S.R. Anjaneyulu

Counsel for the respondent: Learned Government Pleader for Appeals

<Gist:

>Head Note:

?Cases referred:  Nil

HON'BLE SRI JUSTICE K.C. BHANU    
AND
HON'BLE SRI JUSTICE CHALLA KODANDA RAM          

APPEAL SUIT No.361 OF 2002    

JUDGMENT:- (per Hon'ble Sri Justice Challa Kodanda Ram)  
       

This Appeal has been filed by the appellant-Claimant challenging the Common
Order and Decree dated 30.06.2000 of the learned Principal Senior Civil Judge,
Tenali, passed in L.A.O.P. Nos.13 and 14 of 1995.  The impugned Order and Decree
was passed on a reference to the Court under Section 18 of the Land Acquisition
Act, 1894, (for short "the Act").

2) The appellant was the Claimant in L.A.O.P.No.13 of 1995 on the file of the
Principal Senior Civil Judge Court, Tenali.  The appellant was the owner of
Ac.5-25 cents of agriculture land in Sy.No.13/5-A of Godavarru Village, Tenali
Taluq, Guntur District.
An extent of Ac.5-01 cents was acquired by the
Government for providing house sites to weaker sections by issuing a
Notification under Section 4(1) of the Act, dated 23.04.1992.
The Land
Acquisition Officer had determined the market value at the rate of Rs.41,000/-
per acre.  
Being not satisfied with the compensation awarded by the Land
Acquisition Officer, on claimant's application matter was referred to Principal
Senior Civil Judge Court, Tenali and the case was numbered as L.A.O.P. No.13 of
1995.

3) On behalf of the claimants, the claimant in L.A.O.P.No.14 of 1995 was
examined as P.W.1 and the appellant, who was the claimant in L.A.O.P. No.13 of
1995, herself was examined as P.W.2 in addition to P.Ws.3 and 4, and Exs.A.1 and
A.2 were marked and by consent Ex.X.1 Proceedings of the Mandal Revenue Officer,
Duggirala in R.C.No.380/91, dated 31.03.1994 was also marked.  On behalf of the
respondent-referring officer, R.Ws.1 to 4 were examined and Exs.B.1 and B.2
registered extracts of sale deeds dated 04.09.1991 were marked.

4) The learned Judge of the trial Court after elaborate enquiry had taken into
consideration of the evidence of P.W.1, had marked Ex.A.1 Registered Sale Deed,
dated 21.03.1986, under which P.W.1 had purchased an extent of Ac.0-50 cents for
a consideration of Rs.50,000/- per acre and also through Ex.A.2 Registered Sale
Deed, dated 30.04.1990, he purchased an extent of Ac.0-25 cents for a
consideration of Rs.25,000/-, which would work out to Rs.1,00,000/- per acre.
It was elicited from R.W.2, who was examined on behalf of the Land Acquisition
Officer that the lands which were acquired are at a distance of 20 yards from
the road and they are abutting the village.  As per Ex.A.2 Registered Sale Deed,
dated 30.04.1990 there was a transaction of Rs.80,000/- per acre.  The learned
Judge of the trial Court had found, on appreciation of evidence, that the
transaction under Exs.A.1 and A.2 were genuine but discarded Ex.A.2 on the
ground that it is for a small extent of land i.e. Ac.0-25 cents.  Finally,
considering Ex.A.1 though learned Judge had rejected Ex.A.2 by adopting a
strange methodology taking the rate of Rs.80,000/- per acre as value chose to
make a deduction of 1/3rd towards development and further deduction for the
purpose of raising the land on the ground, as the land that is proposed to be
acquired is in lower level to the road by 3 1/2 feet, and finally refused any
enhancement to the claimants. 

5) If Ex.A.1 which is dated 21.03.1986 under which Ac.0-50 cents of land was sold at the rate of Rs.50,000/- per acre and even an escalation of 10% in the market value for each year, the market value can be arrived at Rs.73,000/- and odd per acre.  
The learned Government Pleader would contend minimum of 1/3rd has
to be deducted towards development of the land as the land being acquired for
the purpose of house sites.
On the face of it, the contention of the learned
Government Pleader would appear reasonable, but deduction of 1/3rd towards
development charges merely on the ground that the beneficiary proposes to use
the land for house sites and the Government may have to incur expenditure for
the development of the same, is not correct.
This is for the reason deduction
of 1/3rd would be warranted only 
when the claim of land owners is based on square yard basis, in which case before they can offer the land for sale they are required to expend money and develop the land, and 
in that process there is an element of deduction in the saleable land and also expenditure involved in development.  
However, this is not the case 
where the land is being acquired on
acreage basis by paying lump sum compensation on per acre basis.  
In the light of the above discussion, 
we reject the contention of the learned Government
Pleader that there needs to be 1/3rd deduction considering the fact there is general spiralling of land prices, we feel it just and reasonable to fix the market value  payable as Rs.75,000/- per acre.

6) Accordingly, the order and decree dated 30.06.2000 passed by the learned
Principal Senior Civil Judge, Tenali in L.A.O.P.No.13 of 1995 is modified in
terms of the appeal.
It is needless to mention that the appellant would be
entitled to all statutory benefits including interest on solatium and additional
market value.

7) Accordingly, the appeal is disposed of.  No order as to costs.  The Registry
is directed to issue modified order and decree in terms of the judgment in
appeal.  Miscellaneous Petitions, if any, pending in this appeal, shall stand
dismissed.

______________
K.C.BHANU, J
____________________________    
CHALLA KODANDA RAM, J      
Date:18-07-2013

Section 61 of the AP Cooperative Societies Act, 1964 (for short, 'the Act')= As the borrower committed default in payment of the loan to the Bank, the Bank filed ARC.No.21 of 2000 against the borrower and the guarantor of his loan for recovery of Rs.22,73,848/- with interest from 01-01-2000 thereon under Section 61 of the AP Cooperative Societies Act, 1964 (for short, 'the Act') before the Divisional Cooperative Officer, Golconda Division/Arbitrator (for short, 'the arbitrator') for recovery of the outstanding loan. = Attachment before judgment in proceedings under the Act are governed by Section 73 of the Act r/w Rule 54 of the Rules framed under the Act. Section 73 of the Act states as follows : "73. Attachment of property before decision or order : - If the Registrar is satisfied on application, report, inquiry or otherwise that any person with intent to delay or obstruct the enforcement of any decision or order that may be made against him under the provisions of this Act, -- (a) is about to dispose of the whole or any part of his property; or (b) is about to remove the whole or any part of his property from the jurisdiction of the Registrar, the arbitrator or liquidator, as the case may be, he may unless adequate security is furnished direct the attachment of the said property, and such attachment shall have the same effect as if made by a competent Civil Court." Rule 54 states : "54. Mode of making attachment before judgment under Section 73 of the Act : - (1) Every attachment of property directed under Section 73 of the Act shall be made in the same manner as provided in Rule 52. (2) Where a claim is preferred to property attached under sub-rule (1), such claim shall be investigated in the manner and by the authority specified in Rule 52. (3) A direction made for the attachment of any property under Section 73, may be withdrawn by the Registrar of the district - (a) when the party concerned furnishes the security required, together with security for the costs of the attachment; or (b) when the liquidator determines under clause (c) of sub-section (1) of Section 66 of the Act that no contribution is payable by the party concerned; or (c) when the Registrar passes an order under sub-section (1) of Section 60 of the Act that the party concerned need not repay or restore any money or property or any part thereof with interest or contribute any sum to the assets of the society by way of compensation; or (d) when the dispute referred to in sub-section (1) of Section 61 of the Act has been decided against the party at whose instance the attachment was made. (4) Any attachment made under sub-rule (1) shall not effect the rights existing prior to the attachment, of persons not parties to the proceedings in connection with which the attachment was made, nor bar any person holding a decree against the person whose property is attached from applying for the sale of the property under attachment in execution of such decree. (5) Where the property is under attachment by virtue of the provisions of this rule and a decree is subsequently passed against the person whose property is attached, it shall not be necessary upon an application for execution of such decree to apply for reattachment of the property." 28. Rule 52 deals with procedure in execution of decrees, decisions or orders and sub Rule 21 (a) thereof deals with claims preferred/objections made to attachment of property made under sub Rule 11 after decree/decision/order. Rule 52 (21) (a) states: "(21) (a) Where any claim is preferred or any objection is made to the attachment of any property under this rule on the ground that such property is not liable to such attachment, the officer shall investigate the claim or objection and dispose it of on the merits." 29. A reading of the above provisions indicates that claim petitions to raise attachment before award are governed by Rule 54 and claim petitions to raise attachments after award are governed by Rule 52 (21) (a) of the Rules. Although sub-Rule (2) of Rule 54 states that a claim petition to raise attachment before award is to be investigated in the manner and by the authority specified in Rule 52, sub Rule (3) of Rule 54 specifies in what circumstances an attachment of property made before award/judgment under Section 73 may be withdrawn. Only in the circumstances mentioned in Clauses (a) to (d) of sub Rule (3) of Rule 54, attachment made before judgment may be withdrawn. In view of this, when an application to raise attachment before judgment is made under Rule 54 by a third party to an arbitration under Section 61 objecting to such attachment, it cannot be decided on merits as if it was an attachment after judgment applying sub Rule (21) (a) of Rule 52. In view of sub Rule (2) of Rule 54, only the manner of investigation into the claim can be done as specified in Rule 52 but the disposal of the claim to raise attachment before judgment can only be done as per sub Rule (3) of Rule 54. 30. But a perusal of the order dt.28-07-2004 in claim petition No.1/2001 in A.R.C.No.21 of 2000 indicates that the Arbitrator, without noticing the provisions of Rule 54 (3), followed Rule 52 (21) (a) and adjudicated the claim petition on merits instead of considering whether or not the attachment before judgment can be raised as per Clauses (a) to (d) of Rule 54 (3). The Arbitrator appears to have been swayed by the fact that the agreement of sale is prior in point of time to the mortgage in favour of the Bank and so it would prevail over the same. In taking such a view, the arbitrator went into the following issues: The parties have also stated that the agreement holders have filed O.S.No.9 of 2003 before the II Additional Chief Judge, City Civil Courts, Hyderabad for specific performance of the agreement of sale dt.28-02-1998 against the borrower and they have also impleaded the Bank therein and the said suit is pending.= (i) whether the agreement of sale dt.28-02-1998 in favour of the agreement holders is true and valid, (ii) whether any consideration was paid to the borrower by them, (iii) whether the agreement holders were in lawful possession of the property and (iv) whether the claim petition is maintainable in view of the provisions of the Transfer of Property Act, 1882. 31. In my opinion, considering the language of Rule 54, it was impermissible for the Arbitrator to have gone into issues (i) to (iii) and these issues could only be decided in O.S.No.9 of 2003 where the claim for specific performance of the agreement of sale dt.28-02-1998 made by the agreement holders against the borrower is being decided. It was also not permissible for the Arbitrator to go into issue (iv) as that issue could have been gone into only if it was a case of attachment after judgment to which Rule 52 (21) (a) applies.= This is because at present there is only attachment before judgment under Section 73 of the Act r/w Rule 54 (1) and as per sub Rule (4) of Rule 54, such attachment will not affect the rights existing prior to attachment, of persons not parties to the proceedings in connection with which the attachment was made, nor bar any person holding a decree against the person whose property is attached from applying for sale of the property under attachment in execution of such decree. Therefore it is clear that the order dt.11-05-2000 passed by the Arbitrator in A.R.C.No.21 of 2000 does not affect the rights of the agreement holders who are claiming interest in the property under the alleged agreement of sale dt.28-02-1998. = Both the arbitrator and the tribunal have not taken note of Rule 54(4) of the above Rules. Moreover, the agreement holders are admittedly strangers to the loan transaction between the Bank and the borrower. So in a proceeding between the borrower and the Bank initiated under S.61 of the Act, such persons are not proper or necessary parties merely because they claim to have an interest in the property mortgaged by the borrower to the Bank. Rule 54(4) clearly protects the interest of the agreement holders. Thus their orders are vitiated by error apparent on face of record. So W.P.No.13216/2009 is also allowed and the order dt.25.4.2008 in CTA No.66/2007 of the Tribunal confirming the order dt.24.3.2007 in I.A.No.5/2006 in ARC No.21/2000 of the arbitrator is set aside. 34. Accordingly, W.P.No.21151 of 2008, W.P.No.23718 of 2008 and W.P.13216/2009 are allowed. No costs.

reported in http://judis.nic.in/judis_andhra/qrydisp.aspx?filename=10157
THE HON'BLE SRI JUSTICE M.S. RAMACHANDRA RAO          

W.P.Nos.21151 of 2008

23-07-2013

The A.P.Mahesh Co-op. Urban Bank and others....Petitioner.

1.The Divisional Co-operative Officer, Golconda and others......Respondents.

<GIST:

>HEAD NOTE:  

Counsel for the petitioner-Bank:Sri Muralinarayan Bung and Sri V.Srinivas,

Counsel for the 1st respondent:Learned Government Pleader

^Counsel for the respondents 2 to 6 :   Sri M.R.K.Chakravarthi, Advocate
    representing Sri M.V.Durga Prasad
?Cases referred

THE HON'BLE SRI JUSTICE M.S. RAMACHANDRA RAO          

W.P.Nos.21151, 23718 of 2008 & 13216 of 2009  

COMMON ORDER :    
       

        As common issues arise in these writ petitions, they are being disposed of
by this common order.
2. One C.Nageswara Rao (for short, "borrower") owned a house bearing No.8-3-
967/92 situated at Salivahana Nagar, Srinagar Colony, Hyderabad.
He created an
equitable mortgage of the above property in favor of LIC Housing Finance on 11-
09-1995 by depositing with it, the title deeds relating to it.
3. Subsequently
 he approached the AP Mahesh Cooperative Bank Limited (for short,
'the Bank') for clearing his loan outstanding with LIC Housing Finance and for
the purpose of business development of M/s.Quest Agrotech, an enterprise owned
by him.
On 23-06-1998, the Bank sanctioned to him a loan of Rs.18.56 lakhs.
The borrower paid the loan outstanding with LIC Housing Finance with the amount
released by the Bank, obtained the title deeds from LIC Housing Finance and deposited the same with the Bank on  30-07-1998, towards security for repayment of the loan amount released by the
Bank to him.
4. As the borrower committed default in payment of the loan to the Bank, the
Bank filed ARC.No.21 of 2000 against the borrower and the guarantor of his loan
for recovery of Rs.22,73,848/- with interest from 01-01-2000 thereon under
Section 61 of the AP Cooperative Societies Act, 1964 (for short, 'the Act')
before the Divisional Cooperative Officer, Golconda Division/Arbitrator (for
short, 'the arbitrator') for recovery of the outstanding loan.  
By order dt.11- 05-2000 in ARC.No.21 of 2000, the Deputy Registrar/Officer on Special Duty, AP
Mahesh Cooperative Bank Limited (for short, 'the Deputy Registrar'), in exercise
of his powers under Section 73 of the Act directed attachment before judgment of
the above property till the disposal of the said case pending before the
arbitrator.
This was done on the basis of information obtained by the Bank that
the borrower had executed a registered agreement of sale-cum-Irrivocable General Power of Attorney dt.06-01-2000 with one Mallikarjuna Rao in respect of the mortgaged property, without it's permission and that when the Branch Manager of the Bank inspected the mortgaged property, he found some portion of the above property in the occupation of someone else.
5. On the basis of the above order, the Bank also took possession of the above
property through the Senior Inspector/Sale Officer of the Co-operative
Department.
6. It is alleged that the borrower had entered into an oral agreement of sale on
20-02-1998 with one B.R.S.Chowdary, his wife -Nirmala Devi, son-
B.A.Chakravarthi, and daughters - Ms.B.Harini and Ms.Shanthi (for short,
'agreement holders') for sale of the above property for Rs.30.00 lakhs.
The
agreement holders contend that the borrower showed the original title deeds to
them, that he received Rs.25.00 lakhs towards part sale consideration on 20-02-
1998 under a receipt dt.20-02-1998.
He subsequently executed a written agreement
of sale on 28-02-1998 in their favour promising to register the property by 28-
02-1999 after obtaining the required income tax and other clearances and after
receiving the balance consideration.
They also contended that although the
agreement of sale recited that possession of the property would be given after
receipt of the sale consideration, the borrower sought time of almost one year
for obtaining all the required clearances and for completing the sale
transaction and therefore, at their request, he delivered possession of the
front portion of the above property on 30-03-1998.
It is alleged by the
agreement holders that subsequently, the borrower did not execute sale deed and
demanded by a letter dt.28-02-1999 that the agreement holders pay a further
amount of Rs.24.00 lakhs to him on account of alleged rise in the prices of
properties in the locality and that the said amount was paid to him on 20-05-
1999 under a/c payee cheques.  It is alleged by the agreement holders that the
borrower did not execute the sale deed and kept procrastinating.
7. In the meantime, the Bank had issued a caution notice dt.24-03-2000 in
"Eenadu" and "Deccan Chronicle" Daily Newspapers stating that the borrower had
mortgaged the property by depositing title deeds with the Bank, borrowed loan
from it and cautioning the public not to enter into any negotiations/agreements
with the borrower to purchase the property.
8. The agreement holders allegedly approached the Bank pleading that they have
an agreement of sale dt.28-02-1998 in their favour executed by the borrower in
respect of the above property, that they also paid full consideration to the
borrower and obtained possession from him and furnished documents in proof
thereof.
9. On 04-04-2000, the Bank filed ARC.No.21 of 2000 under Section 61 of the Act
and as stated above and obtained an order on 11-05-2000 attaching the above
property before judgment u/s.73 of the Act.
10. The agreement holders filed CTA.No.184/2000 before the AP Cooperative Tribunal, Hyderabad (for short, 'the Tribunal') under Section 76 of the Act
challenging the Order dt.11-05-2000 in A.R.C.No.21 of 2000 attaching the above property passed by the Deputy Registrar of Cooperative Societies/O.S.D. of the Bank. 
11. By order dt.16-02-2001, the said appeal was disposed of by the Tribunal
observing that the agreement holders are not parties to A.R.C.No.21 of 2000;
that the agreement holders have not become owners as there is no registered sale
deed passing title to them in respect of the above property; that under Rule 54
(1) of the AP Cooperative Societies Rules, 1964, attachment before judgment can
be made in the manner provided in Rule 52 thereof; that there is no ground to
raise the attachment made by order dt.11-05-2000 under Section 73 of the Act;
but the taking of possession of the property under the guise of the attachment
order dt.11-05-2000 cannot be sustained and therefore only that action of the
Bank is set aside.
 It held that it is open to the agreement holders to file a
claim petition under Rule 54 (2) of the above Rules and establish their bona
fide claim and if such an application is filed, the Deputy Registrar of
Cooperative Societies shall investigate in the matter as per Rule 52 and dispose
it of in 30 days.
12. The agreement holders therefore filed claim petition No.1 of 2001 before the
Arbitrator narrating the above facts and sought raising of the attachment of the
property made by the Deputy Registrar/O.S.D. of the AP Mahesh Cooperative Urban
Bank Limited, Hyderabad on 11-05-2000.
13. The Bank filed a counter opposing the claim petition and contended that the
agreement of sale in favour of the agreement holders did not create any right in
the property in their favour; that it is forged and fabricated and is not
genuine; that the agreement holders had no capacity to pay the amounts allegedly
paid by them; that they could not have paid it without taking registered
documents or at least documents of title; that the borrower had executed an
agreement of sale-cum-Irrevocable GPA dt.06-01-2000 with K.Mallikarjuna Rao, a
close relative of one of the agreement holders by name B.R.S.Chowdary and his
son B.A.Chakravarthi had attested as a witness to the said document; therefore
the agreement holders wish to cheat the Bank also; and the claim petition be
dismissed.
14. The borrower also filed a counter denying the execution of the agreement of
sale dt.28-02-1998 in favour of the agreement holders or receiving any
consideration from them.
 He also denied putting them in possession of the
property and contended that the said agreement of sale is fabricated, concocted
and created for the purpose of the claim petition to overcome the equitable
mortgage.  He contended that Sri B.R.S.Chowdary offered to give him financial
help and obtained his signatures on papers on which probably the agreement of
sale dt.28-02-1998 was created; that the transaction is actually only a loan
transaction and not a sale transaction in respect of the property.
 He admitted
that he received Rs.25.00 lakhs from Sri B.R.S. Chowdary but claimed that he had
repaid Rs.35.00 lakhs and sought the dismissal of the claim petition.
15. By order dt.28-07-2004, the Arbitrator allowed the claim petition No. 1 of
2001 by an elaborate order and revoked the attachment order dt.11-05-2000 in
respect of the above property attaching it before judgment.
16. Aggrieved thereby, the borrower filed CTA No.243 of 2004 and the Bank filed
CTA No.14 of 2008 before the Tribunal under Section 76 of the Act.
17. By order dt.25-04-2008, both the appeals were dismissed.  The Tribunal
directed the Arbitrator to dispose of the Arbitration Case as expeditiously
possible.
18. The Bank filed W.P.No.21151 of 2008 in this Court challenging the order
dt.25-04-2008 dismissing CTA.No.14 of 2008 filed by it.
19. The borrower filed W.P.No.23718 of 2008 in this Court challenging the order
dt.25-04-2008 dismissing CTA.No.243 of 2004 filed by him.
20. It is also to be noted that the agreement holders filed I.A.No.5 of 2006
before the Arbitrator in A.R.C.No.21 of 2000, to implead them as parties to it.
By order dt.24-03-2007, the said I.A. was allowed by the Arbitrator and the
agreement holders were impleaded as respondents in the A.R.C.  The Bank filed
CTA.No.66 of 2007 before the Tribunal challenging the said order.  By order
dt.25-04-2008, the said appeal was dismissed.  The Bank filed W.P.No.13216 of
2009 in this Court challenging the order                     dt.25-04-2008
dismissing CTA.No.66 of 2007.
21. The parties have also stated that the agreement holders have filed O.S.No.9
of 2003 before the II Additional Chief Judge, City Civil Courts, Hyderabad for
specific performance of the agreement of sale dt.28-02-1998 against the borrower
and they have also impleaded the Bank therein and the said suit is pending.
22. Heard Sri Murali Narayan Bung and Sri V.Srinivas, learned counsel for the
Bank, Sri S.V.Ramana, learned counsel for the borrower and Sri
M.R.K.Chakravarthi, advocate representing Sri M.V.Durga Prasad, learned counsel
for the agreement holders in these three writ petitions.
23. The learned counsel for the Bank contended that the Arbitrator erred in
allowing the application for impleadment filed by the agreement holders and in
raising the attachment before judgment dt.11-05-2000 made by the Deputy
Registrar under Section 73 of the Act; that the Tribunal erred in confirming the
same; that the agreement holders are not necessary or proper parties to the
A.R.C.No.21 of 2000 as they are not parties to the loan transaction between the
Bank and the borrower; assuming that they have an agreement of sale in their
favour, they cannot become parties to the proceedings under Section 61 of the
Act as only members of the Bank who have borrowed loan can be a party to such
proceedings.
They also contended that the agreement holders are not entitled to
seek raising of attachment before judgment made by the Deputy Registrar as such
agreement of sale, even if it is true, does not create any right, title or
interest in the property except a charge over it for the part consideration paid
under it; that the truth and validity of the execution of the agreement of sale
is being contested in O.S.No.9 of 2003 and therefore this Court should postpone
the hearing of the writ petitions till the said suit is finally decided; that
even otherwise, the Tribunal and the Arbitrator erred in considering the claim
petition on the merits as if it was a claim petition to raise attachment after
judgment under Rule 52 (21) (a) of the Rules instead of considering it under
Rule 54 read with Section 73, as it is a case of attachment before judgment;
that this is an error apparent on the face of record warranting interference by
this Court with the orders dt.25-04-2008 in C.T.A.No.243 of 2004 and C.T.A.No.14
of 2008 passed by the Tribunal confirming the order dt.28-07-2004 in claim
petition No.1/2001 in A.R.C.No.21 of 2000 passed by the Arbitrator.
24. The learned counsel for the borrower supported the Bank and prayed that the
writ petitions be allowed.
25. Per contra, the learned counsel for the agreement holders contended that the
orders impugned do not suffer from any error in law or fact or of jurisdiction
warranting interference by this Court under Article 226 of the Constitution of
India.  He contended that the impugned orders are based on valid reasons which
cannot be said to be perverse; that the attachment before judgment was rightly
raised by the Arbitrator and confirmed by the Tribunal in view of the fact that
the agreement of sale dt.28-02-1998 in their favour is prior in point of time to
the mortgage dt.30-07-1998 in favour of the Bank and would therefore prevail
over the claim of the Bank under the provisions of Section 48 r/w Section 92 of
the Transfer of Property Act, 1882; that they were rightly impleaded in the
Arbitration case A.R.C.No.21 of 2000 by the Arbitrator; and therefore the writ
petitions be dismissed.
26. I have noted the contentions of the respective parties.
27. Attachment before judgment in proceedings under the Act are governed by
Section 73 of the Act r/w Rule 54 of the Rules framed under the Act.
Section 73
of the Act states as follows :
 "73.   Attachment of property before decision or order : -
If the Registrar is
satisfied on application, report, inquiry or otherwise that any person with
intent to delay or obstruct the enforcement of any decision or order that may be
made against him under the provisions of this Act, --
(a)     is about to dispose of the whole or any part of his property; or
(b)     is about to remove the whole or any part of his property from the
jurisdiction of the Registrar, the arbitrator or liquidator, as the case may be,
he may unless adequate security is furnished direct the attachment of the said
property, and such attachment shall have the same effect as if made by a
competent Civil Court."
Rule 54 states :
"54.    Mode of making attachment before judgment under Section 73 of the Act : -
(1)  Every attachment of property directed under Section 73 of the Act shall be
made in the same manner as provided in Rule 52. 
(2)     Where a claim is preferred to property attached under sub-rule (1), such
claim shall be investigated in the manner and by the authority specified in Rule
52.
(3)     A direction made for the attachment of any property under Section 73, may
be withdrawn by the Registrar of the district -
(a)     when the party concerned furnishes the security required, together with
security for the costs of the attachment; or
(b)     when the liquidator determines under clause (c) of sub-section (1) of
Section 66 of the Act that no contribution is payable by the party concerned; or
(c)     when the Registrar passes an order under sub-section (1) of Section 60 of
the Act that the party concerned need not repay or restore any money or property
or any part thereof with interest or contribute any sum to the assets of the
society by way of compensation; or
(d)     when the dispute referred to in sub-section (1) of Section 61 of the Act
has been decided against the party at whose instance the attachment was made. 
(4)     Any attachment made under sub-rule (1) shall not effect the rights
existing prior to the attachment, of persons not parties to the proceedings in
connection with which the attachment was made, nor bar any person holding a 
decree against the person whose property is attached from applying for the sale
of the property under attachment in execution of such decree.
(5)     Where the property is under attachment by virtue of the provisions of this
rule and a decree is subsequently passed against the person whose property is
attached, it shall not be necessary upon an application for execution of such
decree to apply for reattachment of the property."
28. Rule 52 deals with procedure in execution of decrees, decisions or orders and sub Rule 21 (a) thereof deals with claims preferred/objections made to attachment of property made under sub Rule 11 after decree/decision/order. 
 Rule 52 (21) (a) states:
"(21) (a)       Where any claim is preferred or any objection is made to the
attachment of any property under this rule on the ground that such property is
not liable to such attachment, the officer shall investigate the claim or
objection and dispose it of on the merits."
29. A reading of the above provisions indicates that
claim petitions to raise
attachment before award are governed by Rule 54 and claim petitions to raise
attachments after award are governed by Rule 52 (21) (a) of the Rules.
Although
sub-Rule (2) of Rule 54 states that a claim petition to raise attachment before
award is to be investigated in the manner and by the authority specified in Rule
52, sub Rule (3) of Rule 54 specifies in what circumstances an attachment of
property made before award/judgment under Section 73 may be withdrawn.
Only in
the circumstances mentioned in Clauses (a) to (d) of sub Rule (3) of Rule 54,
attachment made before judgment may be withdrawn.
In view of this, when an
application to raise attachment before judgment is made under Rule 54 by a third
party to an arbitration under Section 61 objecting to such attachment, it cannot
be decided on merits as if it was an attachment after judgment applying sub Rule
(21) (a) of Rule 52.
 In view of sub Rule (2) of Rule 54, only the manner of
investigation into the claim can be done as specified in Rule 52 but the
disposal of the claim to raise attachment before judgment can only be done as
per sub Rule (3) of Rule 54.
30. But a perusal of the order dt.28-07-2004 in claim petition No.1/2001 in
A.R.C.No.21 of 2000 indicates that the Arbitrator, without noticing the
provisions of Rule 54 (3), followed Rule 52 (21) (a) and adjudicated the claim petition on merits instead of considering whether or not the attachment before judgment can be raised as per Clauses (a) to (d) of Rule 54 (3).  
The Arbitrator
appears to have been swayed by the fact that the agreement of sale is prior in point of time to the mortgage in favour of the Bank and so it would prevail over the same.
 In taking such a view, the arbitrator went into the following issues:
 (i) whether the agreement of sale dt.28-02-1998 in favour of the agreement
holders is true and valid,
(ii) whether any consideration was paid to the borrower by them,
 (iii) whether the agreement holders were in lawful possession of the property
and 
(iv) whether the claim petition is maintainable in view of the provisions of the
Transfer of Property Act, 1882.
31. In my opinion, considering the language of Rule 54, 
it was impermissible for
the Arbitrator to have gone into issues (i) to (iii) and 
these issues could only
be decided in O.S.No.9 of 2003 where the claim for specific performance of the agreement of sale dt.28-02-1998 made by the agreement holders against the borrower is being decided.  
It was also not permissible for the
Arbitrator to go into issue (iv) as that issue could have been gone into only if it was a case of attachment after judgment to which Rule 52 (21) (a) applies.
It is not permissible to do so when it is a case of attachment before judgment under Section 73 to which Rule 54 (3) applies.  
Therefore the Arbitrator could
have only considered
whether the claim petitioners/agreement holders have made
out a case for withdrawal of attachment before the judgment under clauses (a) to (d) of sub Rule (3) of Rule 54 and nothing else.  
Therefore I am of the opinion
that the order dt.28-07-2004 in Claim Petition No.1 of 2001 in A.R.C.No.21 of 2000 is clearly unsustainable for the above reasons.
32. When the said order was challenged before the Tribunal in C.T.A.No.243 of
2004 by the borrower and in C.T.A.No.14 of 2008 by the Bank, the Tribunal also
did not consider the scope of enquiry in a claim petition to raise attachment
before judgment governed by Rule 54 (3) and committed the same mistakes
committed by the Arbitrator in the order dt.28-07-2004 challenged before it.
Thus orders                 dt.25-04-2008 in C.T.A.No.243 of 2004 and
C.T.A.No.14 of 2008 are vitiated by error apparent on face of record. So the W.P
No.s 21151/2008 and 23718/2008 are allowed and orders dt.25-04-2008 in
C.T.A.No.243 of 2004 and C.T.A.No.14 of 2008  confirming the order dt.28.7.2004
in Claim petition no.1/2001 in ARC no.21/2000  are set aside.
33. It is made clear that the observations made in the said orders are liable to
be ignored by the Arbitrator while deciding A.R.C.No.21 of 2000 and by the Civil
Court while deciding O.S.No.9 of 2003.
It is also made clear that in the event
the A.R.C.No.21 of 2000 is allowed, the agreement holders are entitled to file a
claim petition under Rule 52 (21) (a) and any findings made in the above orders
shall be ignored while considering such a claim petition, if filed by the
agreement holders.
This is because at present there is only attachment before
judgment under Section 73 of the Act r/w Rule 54 (1) and as per sub Rule (4) of Rule 54, such attachment will not affect the rights existing prior to attachment, of persons not parties to the proceedings in connection with which the attachment was made, nor bar any person holding a decree against the person whose property is attached from applying for sale of the property under attachment in execution of such decree.  
Therefore it is clear that the order
dt.11-05-2000 passed by the Arbitrator in A.R.C.No.21 of 2000 does not affect the rights of the agreement holders who are claiming interest in the property under the alleged agreement of sale dt.28-02-1998. 
In view of
this the arbitrator could not have impleaded the agreement holders vide orders
dt.24.3.2007 in I.A.no.5/2006 in ARC No.21/2000 and the Tribunal in CTA
No.66/2007 erred in confirming it.
Both the arbitrator and the tribunal have not taken note of Rule 54(4) of the above Rules.
Moreover, the agreement holders are
admittedly strangers to the loan transaction between the Bank and the borrower.
So in a proceeding between the borrower and the Bank initiated under S.61 of the Act, such persons are not proper or necessary parties merely because they claim to have an interest in the property mortgaged by the borrower to the Bank. 
Rule 54(4) clearly protects the interest of the agreement holders. 
Thus their orders
are vitiated by error apparent on face of record. 
So W.P.No.13216/2009 is also
allowed and the order dt.25.4.2008 in CTA No.66/2007 of the Tribunal confirming
the order dt.24.3.2007 in I.A.No.5/2006 in ARC No.21/2000 of the arbitrator is
set aside.
34. Accordingly, W.P.No.21151 of 2008, W.P.No.23718 of 2008 and W.P.13216/2009    
are allowed. No costs.
 ___________________________________    
JUSTICE M.S. RAMACHANDRA RAO        

Date : 23-07-2013

NO POLICE AID PENDING ENQUIRY OF EXPARTE INJUNCTION = since I.A.No.379 of 2002 filed under Order 39 Rules 1 & 2 of C.P.C. filed for temporary injunction has not yet been decided on merits despite counter filed by the defendants, the Court below ought not to have granted police aid for enforcement of the order of the ad interim injunction dated 9.10.2002.

REPORTED IN /judis.nic.in/judis_andhra/filename=5839
THE HON'BLE Ms. JUSTICE G. ROHINI    
Civil Revision Petition No.2181 of 2008

21-07-2008

Kasturi Venkata Subbaiah and 9 others.

Veerapareddy Yasodamma.  

Counsel for the petitioners: Sri Nimmagadda Satyanarayana

Counsel for the respondent:  Sri M. Balaji

:ORDER:

        This Civil Revision Petition is directed against the order dated 10.4.2008
in I.A.No.454 of 2002 in I.A.No.379 of 2002 in O.S.No.66 of 2002 on the file of
the Court of the Senior Civil Judge, Rajampet.
        The revision petitioners are the defendants in the suit filed by the
respondent  herein for specific performance of agreement of sale in respect of
the suit schedule properties.  Along with the suit, the plaintiff/respondent
herein filed I.A.No.379 of 2002 for grant of temporary injunction restraining
the defendants/revision petitioners  from interfering with the suit schedule
property. The Court below granted ad interim injunction on 9.10.2002.  The
defendants/revision petitioners  filed their counters contesting the said
application for temporary injunction.  While I.A.No.379 of 2002 for temporary
injunction was yet to be heard, the plaintiff/respondent herein filed another
application being I.A.No.454 of 2002 on 28.11.2002 for grant of police aid for
implementation of the order of ad interim injunction. The said application was
also opposed by the defendants/revision petitioners  by filing a counter.
However, no final orders were passed on any of the said applications and they
were merely kept pending.
While so, on 20.6.2007 I.A.No.379 of 2002 filed for temporary injunction was
dismissed for non-prosecution by the plaintiff/respondent herein.  Subsequently,
on an application made by the plaintiff/respondent herein, I.A.No.379 of 2002
was restored to file by order dated 10.4.2008.  Surprisingly on the same day
i.e., 10.4.2008 the Court below allowed I.A.No.454 of 2002 also thereby granting
police aid for implementation of the order of ad interim injunction dated
9.10.2002.
The said order made in I.A.No.454 of 2002 is under challenge in this Civil
Revision Petition.
        I have heard the learned counsel for both the parties and perused the
material on record.
        There can be no dispute about the inherent powers of a Court to grant
police aid for implementation of its orders so as to meet the ends of justice
and to prevent abuse of process of the Court. Such a power can be exercised even
to enforce the order of ad interim injunction. However, the question is whether
the Court below is justified in granting police aid on 10.4.2008  on an
application filed in the year 2002 for the purpose of enforcement of ad interim
injunction dated 9.10.2002.
        It is relevant to note that the defendants/revision petitioners filed
counter contesting the application for temporary injunction in the year 2002
itself. However, the application was kept pending for a long time and ultimately
it was dismissed for default on       20.06.2007. Thereafter, there was no order
in operation till the application was restored to file on 10.4.2008.
        Even while seeking restoration, the plaintiff  did not allege or establish
any attempt on the part of the defendants to violate the order of ad interim
injunction warranting grant of police aid.  In the circumstances, what prompted
the Court below  to grant police aid  on 10.04.2008 on the basis of the
allegations made in the application filed in the year 2002 is ununderstandable.
        It is also relevant to note that in I.A.No.454 of 2002 filed for police
aid, a counter was already filed by  the  defendants/petitioners herein.
However,    even without referring to the said counter the court below allowed
I.A.No.454 of 2002 by a cryptic order which runs as under :
"Heard the learned counsel for the petitioner, and the counsel for the
respondents.  The I.A.No.379/2002 is restored to file and injunction  order
already granted on 9.10.2002 is continued. As there is injunction order pending
issued by this Court the bounden duty of this Court to protect its own order.
This Court has no alternative except to grant police aid to the petitioner to
protect the injunction order  already granted on 9.10.2002 in I.A.No.379/2002.
In order to protect the own order of this Court and in view of the facts and
circumstances of the case, I have no hesitation to say  that the petitioner
herein  is entitled for the relief of police aid  to protect the injunction
order already granted by this Court on 9.10.2002 in I.A.No.379 of 2002 and
thereby this petition merits to be allowed, and accordingly this petition is
allowed, in the circumstances without costs."

        As rightly submitted by the learned counsel for the petitioners,
since
I.A.No.379 of 2002 filed under Order 39 Rules      1 & 2 of C.P.C. filed for
temporary injunction has not yet been decided on merits despite counter filed by the defendants, the Court below ought not to have granted police aid for enforcement of the order of the ad interim injunction dated 9.10.2002.
Particularly in the absence of any fresh material to show that there was any
attempt on the part of the defendants to violate the order of injunction, there
was absolutely no justification to grant police aid. Moreover, except observing
that since there is an order of injunction the Court is bound to protect its own
order by granting police aid, the Court below did not assign any reasons which
warranted granting the relief of police aid.
From the facts and circumstances of the case noticed above, I am of the opinion
that the Court below committed a grave error in granting police aid firstly,
without disposing of the application for temporary injunction on  merits and
secondly without assigning any reasons for grant of such police aid. At any
rate, in the absence of any fresh material the impugned order  granting police
aid on an application made in the year 2002, on the face of it, amounts to
erroneous exercise of jurisdiction conferred under law.
        Viewed from any angle, the  order under Revision being contrary to law is
unsustainable. Accordingly, the same is hereby set aside and the Civil Revision
Petition is allowed with a direction to consider and decide I.A.No.454 of 2002
after disposal of I.A.No.379 of 2002 filed for temporary injunction on merits.
No costs.

NO POLICE AID IN E.P. PROCEEDINGS OF PERMANENT INJUNCTION DECREE = whether E.A.No.407 of 2004 filed by the first respondent is maintainable or whether the executing Court was justified in granting police aid.= Order 21 C.P.C. provides for the mode of execution of decrees of different purport. The mode of execution would depend much upon the nature of the decree. So far as the execution of the decree for perpetual injunction is concerned, Rule 32 of Order 21 C.P.C. provides for two courses of action, namely arrest of the judgment-debtor or attachment of his properties. Beyond that, no other course of action is permitted. Precedents are to the effect that in case the judgment debtor in a decree for perpetual injunction assumes possession of the schedule property, the remedy open to the aggrieved party is to institute a suit for recovery of possession. Further, invocation of Section 151 C.P.C. in the execution proceedings is almost impermissible.

REPORTED IN http://judis.nic.in/judis_andhra/qrydispfree.aspx?filename=6709
THE HON'BLE SRI JUSTICE L.NARASIMHA REDDY        
Civil Revision Petition No.6753 of  2004

12-08-2009

K.Srinivasa Rao (died) per L.Rs. and another.

K.Hanumantha Rao and another.  

For the Petitioner: Mr. Subba Rao

For the Respondents: Mr. Venugopala Rao

:ORDER:

        The first respondent filed O.S.No.228 of 2001 in the Court of the
Principal Junior Civil Judge, Gurazala against the second respondent and the
petitioners herein for the relief of perpetual injunction in respect of the suit
schedule property.  The suit was decreed on 15.04.2003.  Alleging that the
petitioners herein are interfering with his possession over the suit schedule
property, the first respondent filed E.P.No.115 of 2004 obviously, under Rule 32
of Order 21 C.P.C.  He has also filed E.A.No.407 of 2004 under Section 151
C.P.C. with a prayer to grant police aid.  The petitioner opposed the
application on several grounds. The executing Court allowed the E.A., through
the order, dated 25.10.2004.  Hence, this revision.
        Sri N.Subba Rao, learned counsel for the petitioners, submits that the
grant of police aid in the course of execution of a decree for perpetual
injunction is unknown to law and it is totally outside the scope of the
execution itself.  He contends that the executing Court did not take this aspect
into account and had straightaway allowed the E.A.
        Sri V.Venugopala Rao, learned counsel for the first respondent, on the
other hand, submits that the petitioners started interfering with the possession
of the first respondent over the suit schedule property, despite the decree, and
police aid was sought to protect the possession.
        The short question that arises for consideration in this revision is as to
whether E.A.No.407 of 2004 filed by the first respondent is maintainable or
whether the executing Court was justified in granting police aid.
        Order 21 C.P.C. provides for the mode of execution of decrees of different
purport.  The mode of execution would depend much upon the nature of the decree.
So far as the execution of the decree for perpetual injunction is concerned,
Rule 32 of Order 21 C.P.C. provides for two courses of action, namely arrest of
the judgment-debtor or attachment of his properties. Beyond that, no other
course of action is permitted.  Precedents are to the effect that in case the
judgment debtor in a decree for perpetual injunction assumes possession of the
schedule property, the remedy open to the aggrieved party is to institute a suit
for recovery of possession.
        Further, invocation of Section 151 C.P.C. in the execution proceedings is
almost impermissible.  The reason is that every contingency is taken care of by
Order 21 C.P.C. Inasmuch as any direction in the execution proceedings visits
with serious consequences, it must be specifically provided for.  If there does
not exist any specific provision, recourse cannot be had to Section 151 C.P.C.
in matters of this nature. Viewed from any angle, the order under revision
cannot be sustained in law.
        Hence, the civil revision petition is allowed and the order under revision
is set aside.  There shall be no order as to costs.

No police Aid as the injunction orders are misused = In the instant case, the temporary injunction was obtained by the revision petitioner in respect of the vacant site and thereafter they constructed a small room in a portion of the schedule mentioned site. The allegation against the respondents is that after construction of the said structure, they trespassed into the property violating the orders of injunction and dismantled the said structure. The police protection was not in fact sought to protect the vacant site in respect of which the injunction order was granted. The said structure was raised by the petitioner only after obtaining the order of temporary injunction pending disposal of the suit. No permission was obtained from the Court to raise the structure.

REPORTED IN judis.nic.in/judis_andhra/filename=8743

HON'BLE SRI JUSTICE R.KANTHA RAO        

C.R.P.No.931 OF 2011  

27-09-2011 

Smt Shamsunnisa Begum    

                        

J.R.Ladaram and others 

Counsel for appellant:  Sri M.Rajamalla Reddy

                                

Counsel for respondents : Sri T.V.Kalyan Singh

? Cases referred:

1 AIR 1971 AP 53 

2 2006(4)ALT 660 

3 2010(2) ALD 41 (DB) 

ORDER:  

        This civil revision petition is filed against the order dated 03.12.2010

passed by the Principal Junior Civil Judge, Nizamabad in I.A.No.1121 of 2010 in

O.S.No.462 of 2003. 

2.      I have heard Sri M.Rajamalla Reddy, learned counsel appearing for the

petitioner and Sri T.V.Kalyan Singh, learned counsel appearing for the

Respondents. 

3.      The petitioner in a suit filed by her for permanent injunction obtained

order of temporary injunction pending disposal of the suit I.A.No.1958 of 2003

and in the appeal filed there-against in C.M.A.No.15 of 2006, the appellate

Court confirmed the order dated 07.09.2003 passed by the trial Court.

Subsequently, it is said that the respondents trespassed into the part of the

schedule mentioned land and caused damage to certain constructions raised by the 

petitioner therein after obtaining temporary injunction.  Under these

circumstances, the petitioner filed a petition under Section 151 CPC to grant

police aid for implementing the orders of the temporary injunction passed in

favour of the petitioner by the trial Court pending disposal of the suit which

is confirmed by the appellate Court in the civil miscellaneous appeal.

4.      The earned trial Court having gone through the facts of the case

elaborately and examining the circumstances in which the petitioner seeking

police aid came to be filed, dismissed the same on the ground that the

petitioners are protracting the trial of the suit when the defendants are ready

to proceed with the trial and expressed the view that the plaintiff can as well

invoke the jurisdiction of the trial Court by filing proper application under

Order 39 Rule 2(A) CPC for breach of injunction committed by the respondents.

Against the said order, the present revision petition is filed.

5.      The learned counsel appearing for the revision petitioner relied upon a

judgment of the Division Bench of this Court in RAYAPATI AUDEMMA v POTHINENI     

NARASIMHAM1 wherein it is held as follows:  

"There being no express provision in the Code for the grant of police aid, the

Court can grant aid under its inherent powers and that Order 39 Rule 2(3) does

not deal with implementation but with punishment for disobedience and therefore,

the order can be implemented under Article 226 of the Constitution."

6.      The learned counsel further relied upon a judgment of the learned Single

Judge in NEETHA CHINTAWAR AND ANOTHER v BODUGAM GOPI2 wherein the learned single             

judge held as follows:

"Refusal to grant police protection amounts to practically rendering the order

of temporary injunction ineffective and therefore, the Court can grant police

aid by exercising its power under Section 151 CPC even though the party applying

for police aid can institute proceedings under Rule 2(A) of Order 39 CPC for

breach of temporary injunction."

7.      On the other hand, the learned counsel appearing for the respondents

relied upon a decision in POLAVARAPU NAGAMANI AND OTHERS v PARCHURI KOTESHWARA                 

RAO AND OTHERS3 wherein the Division Bench of this Court deprecated the practice   

of granting police aid for implementation for mere asking and issued certain

guidelines in the matter of granting police aid by the Courts.  The legal

position as stated by the Division Bench on the issue of granting police aid to

implement the orders granting temporary injunction or any other temporary relief

is that the discretion entirely rests with the Court in exercising its

jurisdiction.  Whenever an application seeking for police aid is granted, it is

not obligatory on the part of the Court to grant police aid.  The Court can

grant police aid exercising its discretion if the situation warrants, such an

exercise of power by the Court, the police have to discharge several important

functions in performance of their duty.  Normally, the indulgence of the police

in civil disputes shall be avoided and only in exceptional situations, the

assistance of the police can be cited and granted when the situation goes out of

the control of the parties and it cannot be remedied by merely resorting to the

civil remedies available to the parties. Whenever the party, in whose favour the

order granting temporary injunction is not able to prevent the invasion of the

opposite party, the police aid cannot be granted in a routine manner and it can

be only granted in exceptional circumstances warranting such an exercise of

power by the Court.

8.      In the instant case, the temporary injunction was obtained by the revision

petitioner in respect of the vacant site and thereafter they constructed a small

room in a portion of the schedule mentioned site.  The allegation against the

respondents is that after construction of the said structure, they trespassed

into the property violating the orders of injunction and dismantled the said

structure.  The police protection was not in fact sought to protect the vacant

site in respect of which the injunction order was granted.  The said structure

was raised by the petitioner only after obtaining the order of temporary

injunction pending disposal of the suit.  No permission was obtained from the

Court to raise the structure.

9.      In any event, the learned trial Court examined the entire situation having

regard to the circumstances of the case and refused to grant police aid.  When

the Court after exercising discretionary power refused to invoke the inherent

powers conferred on it, it cannot be said that any error of jurisdiction is

committed by the Court and there is no irregularity or illegality in the order

dated 03.12.2010 passed by the Principal Junior Civil Judge, Nizamabad in

I.A.No.1121 of 2010 in O.S.No.462 of 2003, the revision petition is liable to be

dismissed. 

6.      For all the reasons mentioned above, there are no valid grounds to

interfere with the order dated 03.12.2010 passed by the Principal Junior Civil

Judge, Nizamabad in I.A.No.1121 of 2010 in O.S.No.462 of 2003. The revision

petition therefore fails and the same is dismissed.  There shall be no order as

to costs.

        

_________________   

R. KANTHA RAO, J   

Date: 27.09.2011