Partly allowed

K T Pushpalatha v. Joint Registrar of Co-Operative

Karnataka HC2 Dec 2021WP/9073/2018

Case brief

AI extract

What is this about?

The High Court allowed the writ petition in part, quashing the arbitral award and KAT order awarded interest beyond the agreed rate in a dispute between co-operative society bank borrowers and the bank. The court scaled down the interest from 12.5% to 12% per mensem based on the loan agreement terms.

What did the court decide?

Interest rate in the arbitral award scaled down from 12.5% to 12% per mensem; subsequent payments to be adjusted.

K T Pushpalatha Vs Joint Registrar of Co-Operative — Cooperative Societies | Karnataka HC (2021)

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 2^ND DAY OF DECEMBER, 2021

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BEFORE

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THE HON’BLE MR. JUSTICE KRISHNA S.DIXIT

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WRIT PETITION NO.9073 OF 2018 (CS-RES)

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BETWEEN:

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K.T. PUSHPALATHA, W/O. G.D. CHINNAGIRIYAPPA, AGED ABOUT 45 YEARS, R/AT: PUSHPANJALI NILAYA, BASAVESHWARA NAGARA, MAHARAJA KATTE ROAD, KANAKAPURA TOWN, RAMANAGARA DISTRICT - 562 117.

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G.D. CHANNAGIRIYAPPA, S/O LATE DASAPPA, AGED ABOUT 50 YEARS, R/AT PUSHPANJALI NILAYA, BASAVESHWARA NAGARA, MAHARAJA KATTE ROAD, KANAKAPURA TOWN, RAMANAGARA DISTRICT - 562 117.

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…PETITIONERS

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(BY SRI. N. RAMACHANDRA, ADVOCATE)

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AND:

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JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES, BENGALURU REGION, PAMPAMAHAKAVI ROAD, CHAMARAJPETE, BENGALURU - 560 018.

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NOW THE OFFICE IS SHIFTED TO SAHAKARA SOUDHA, 3RD FLOOR, MARGOSA ROAD, 8TH CROSS, MALLESHWARAM, BENGALURU - 560 003.

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BENGALURU, BENGALURU RURAL DISTRICT AND RAMANAGARA DISTRICT CENTRAL CO-OPERATIVE BANK LTD., KANAKAPURA BRANCH, MUNICIPAL ROAD, KANAKAPURA TOWN - 562 117. REPRESENTED BY ITS BRANCH MANAGER

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BENGALURU, BENGALURU RURAL DISTRICT AND RAMANAGARA DISTRICT CENTRAL CO-OPERATIVE BANK LTD.,

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HEAD OFFICE: LAKSHMI SADANA, 5TH MAIN ROAD, CHAMARAJPETE, BENGALURU - 560 018. REPRESENTED BY ITS MANAGING DIRECTOR

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…RESPONDENTS (BY SRI. VINOD KUMAR M, AGA FOR R1 SRI. SOMASHEKAR, ADVOCATE FOR R2 AND R3)

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THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER PASSED BY THE ARBITRATOR IN DISPUTE NO: JRB/ DIS/ 1136/ 2010-11, DTD. 30.7.2011 VIDE ANNEXURE-A, AND ALSO THE ORDER PASSED ON 27.8.2015 BY THE HON'BLE TRIBUNAL IN APPEAL NO.821/2011 VIDE ANNEXURE-C.

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THIS WRIT PETITION COMING ON FOR ORDERS THIS DAY, THE COURT MADE THE FOLLOWING:

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ORDER

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Petitioners admittedly being the borrowers of

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respondent No.2-Co-operative Bank, are knocking at the doors of the Writ Court for assailing Karnataka Appellate

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Tribunal Order dated 27.08.2015, rejecting their appeal No.821/2011 whereby the award dated 30.07.2011 made by the respondent-arbitrator in favour of respondent-Cooperative Bank, is affirmed.

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After service of notice, respondent No.1-Joint

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Registrar of Co-operative Societies is represented by the learned AGA and respondent Nos.2 & 3 namely the Bank are represented by their Senior Panel Counsel; both AGA & Panel Counsel vehemently oppose the writ petition making submission in justification of impugned KAT order & JRCS award and the reasons on which they have been structured.

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Having heard the learned counsel for the parities

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and having perused the petition papers, this court grants a marginal indulgence in the matter as under and for the following reasons:

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(a) The admitted position of debtor-creditor relationship

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between the petitioner & the respondent-Bank has led to passing of the impugned award and the challenge thereto which came to be negatived by the Karnataka Appellate

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Tribunal; therefore, in limited constitutional jurisdiction vested under Article 227, the substratum on which the impugned order are constructed cannot be much meddled with by this court as held by the Apex Court in vide

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SADHANA LODH Vs. NATIONAL INSURANCE CO. LTD., &

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ANOTHER, (2003) 3 SCC 524.

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(b) The vehement submission of learned counsel for

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petitioners that their counsel did not effectively participate before the official arbitrator and thus, they did not have a reasonable opportunity of putting forth their version, cannot be countenanced; for the mistake of the lawyer, his client should not suffer is only general proposition of law admitting several exceptions; if the lawyer has not discharged his duty to the client, the redressal for the grievance is elsewhere; this apart, no material is produced before this Court to show that the engaged lawyer did not discharge his professional obligation nor anything shown as to what action is taken against the said lawyer; that being the position, much grievance cannot be made out by taking up the contentions of the kind.

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about the Loan Agreement; petitioners being the borrowers have to pay back what has been borrowed; the money which respondent-Co-operative Bank handles is a public money; the very contention of the petitioners that they have paid back considerable sums of money itself, amounts to admission on their part as to the debt & its recoverability; these inarticulate aspects having been animated the impugned orders, no case is made out for a wholesale indulgence, as rightly contended by the Panel Counsel for respondent – Bank.

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(d) The vehement submission of learned counsel for

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petitioners that under the terms of Loan Agreement, the interest payable was only 2% per mensem and therefore, more than what was agreed between the parties could not have been awarded by the Joint Registrar of Co-operative Societies, has some force; the records reveal that JRCS has awarded 2.5% i.e., 0.5% in excess of agreed terms and this could not have been done; to a limited extent, there is apparent error on the face of the record which aspect had

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escaped the attention of KAT; therefore, to that extent,

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indulgence of the writ Court is warranted.

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In the above circumstances, this writ petition is allowed in part; the rate of interest mentioned in the JRCS award as affirmed by the Karnataka Appellate Tribunal order, is scaled down to 12% from 12.5% per mensem.

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It hardly needs to be stated that all & whatever amount petitioners have paid subsequent to orders made by the JRCS & the KAT shall be given due deduction, in accordance with law.

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Costs made easy.

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Sd/JUDGE

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DS/JY

K T Pushpalatha v. Joint Registrar of Co-Operative

Case brief

What is this about?

What did the court decide?

K T Pushpalatha v. Joint Registrar of Co-Operative

Case brief

What is this about?

What did the court decide?

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