Full Judgment
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR & THE HONOURABLE MR. JUSTICE SHAJI P.CHALY WEDNESDAY, THE 30TH DAY OF NOVEMBER 2022 / 9TH AGRAHAYANA, 1944 WA NO. 621 OF 2021 AGAINST THE JUDGMENT IN WP(C) 32296/2016 OF HIGH COURT OF KERALA APPELLANTS/RESPONDENTS 2, 7 & 8: 1 MANAGER KERALA STATE FINANCIAL ENTERPRISES LTD, PANDIKKAD BRANCH, PANDIKKAD P.O.- 676 541, MALAPPURAM DISTRICT. 2 KERALA STATE FINANCIAL ENTERPRISES LTD, REPRESENTED BY ITS GENERAL MANAGER, HEAD OFFICE, THRISSUR-680 020. 3 THE GENERAL MANAGER, KERALA STATE FINANCIAL ENTERPRISES LTD, HEAD OFFICE, THRISSUR-680 020. BY ADV K.A.SALIL NARAYANAN RESPONDENTS/PETITIONERS AND RESPONDENTS 1 AND 3 TO 6: 1 MUMTHAS C
PD TEACHER, ALP SCHOOL, VADAKKUMMURI, W/O AHAMMEDKUTTY, HABEEBA MANZIL, UGRAPURAM.P.O, ARECODE(VIA), ERNAD TALUK, MALAPPURAM DISTRICT-673 639. 2 BINDU ELLARTHODI, PD TEACHER, GOVERNMENT BOYS HIGHER SECONDARY SCHOOL, MANJERI, VADAKKETHODI HOUSE, KOVILAKOMKUNDU SOUTH, MANJERI P.O, ERNAD TALUK, MALAPPURAM DISTRICT-676 121. 3 THE TAHSILDAR, REVENUE RECOVERY, KERALA STATE FINANCIAL ENTERPRISES LTD, PALAKKAD-678 001. 4 THE HEADMASTER, ALP SCHOOL, VADAKKUMMURI, URANGATTIRI, PIN-673 639, MALAPPURAM DISTRICT.
5 THE HEADMASTER, GOVERNMENT BOYS HIGHER SECONDARY SCHOOL, MANJERI, MANJERI.P.O.-676 121, MALAPPURAM DISTRICT. 6 SIJU THOMAS, VEERALASSERI HOUSE, THOTTUMUKKOM.P.O, KOZHIKODE DISTRICT-673 604. 7 AYISHA, W/O.RAHMATHULLA, AMBAZHATHINGAL HOUSE, IRIYATTU PARAMBU, VADAKKUMMURI, URANGATTIRI, ARECODE-676 510, MALAPPURAM DISTRICT. SRI. P. SAMSUDIN THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 30.11.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
JUDGMENT
Dated this the 30th day of November, 2022
Shaji P. Chaly, J.
Instant writ appeal is filed by respondents 2, 7 and 8 in
W.P.(C)No.32296 of 2016, challenging the judgment dated 11.02.2021, whereby the learned single Judge allowed the writ petition; set aside Exhibits P1 and P2 communications and granted liberty to the 1st appellant herein to recover the amounts due to the Kerala State Financial Enterprises Ltd. (KSFE) by any means known to law, other than by way of recovering the amounts from the salary of respondents 1 and 2/writ petitioners.
2. Brief material facts for the disposal of the appeal are
as under: Respondents 1 and 2 are Primary Department Teachers. They were enrolled in a chitty by the husband of the 7 th respondent, namely, Rahmathulla. The 7th respondent was also a subscriber to a chitty in the Manjeri branch. Respondents 1 and 2 had given their salary certificates for furnishing as security for the chitty availed by the 7th respondent. But the said certificates are made use of to disburse the chitty prized by the 6 th respondent, with the connivance of the then Manager of the 1st appellant branch. Apart from giving the salary certificates, respondents 1 and 2 have not gone to the branch office of the 1st appellant and have not signed or executed any documents in the Pandikkad branch office of KSFE so as to create any guarantee or security. The salary certificates and guarantee documents were not sent for cross checking to the employers of respondents 1 and 2. When respondents 1 and 2 were served with Exhibits P1 and P2 demand notices, they submitted a detailed complaint to the Branch Manager. Simultaneously, they filed a complaint before the Dy SP, VACB, who, in turn, recommended registration of case and investigation. While so, proceedings to recover Rs.10,000/- each from the salary of respondents 1 and 2 is being proceeded with. Hence the writ petition was filed seeking the following reliefs:
“i) issue a writ of certiorari or any other appropriate writ,
order or direction, calling for the records leading to Exbt-
P1 and Exbt-P2 and quash the same. ii) issue a writ of mandamus or any other appropriate writ,
order or direction, directing the 2 nd respondent to
consider Exbt-P2 and P3 representation and relieve the petitioners from the liability to pay amounts due from 5 th respondent.”
3. The learned single Judge, after taking into account the
rival submissions made, and also bearing in mind the allegation made by the writ petitioners that they have not executed any security deed to release the prized chit amount in favour of the 6th respondent directed not to recover the amount by resorting to salary recovery.
4. The paramount contention advanced in the writ
appeal is that as KSFE is a company conducting chit business, and, therefore, the dispute relating to the same shall be referred to the Registrar for arbitration as per section 64 of the Chit Funds Act, 1982. It is further contended that if at all there is a dispute, the writ petitioners ought to have invoked section 64 of the Chit Funds Act, 1982 in order to resolve the dispute. Various contentions are raised relying upon section 64 of the Chit Funds Act, 1982. It is further contended that since an alternative remedy was available to invoke section 64, the writ petition should not have been entertained by the writ court. It is further pointed out that the learned single Judge erred by going into the disputed facts in order to arrive at a finding in the judgment. It is further submitted that consequent to the findings made by the learned single Judge, the appellants are put to serious prejudices.
5. We have heard learned counsel Sri. Salil Narayanan for the appellants and learned counsel Sri. P. Samsudin for the party respondents and perused the pleadings and the material on record.
6. The sole question to be considered is whether the appellants have made out any case for interference with the
judgment of the learned single Judge. As we have pointed out
above, the case projected by the appellants is that if the writ petitioners had any dispute with respect to the execution of the documents, the writ petitioners ought to have invoked section 64 of the Chit Funds Act, 1982. Section 64 of the Act deals with disputes relating to chit business, which reads thus:
“64. Disputes relating to chit business.- (1) Notwithstanding anything contained in any other law for the time being in force, any dispute touching the management of a chit business shall be referred by any of the parties to the dispute, to the Registrar for arbitration if each party thereto is one or the other of the following, namely:-
(a) a foreman, a prized subscriber or a non-prized subscriber, including a defaulting subscriber, past subscriber or a person claiming through a subscriber, or a deceased subscriber to a chit;
(b) a surety of a subscriber, past subscriber, or a deceased subscriber. Explanation-For the purposes of this sub-section, a dispute touching the management of a chit business shall include,-
(i) a claim by or against a foreman for any debt or
demand due to him from a subscriber, or due from him to a subscriber, past subscriber or the nominee, heir or legal representative of a deceased subscriber whether such debt or demand is admitted or not;
(ii) a claim by a surety for any sum or demand due to him
from the principal borrower in respect of a loan by a foreman and recovered from the surety owing to the default of the principal borrower, whether such sum or demand is admitted or not; and
(iii) a refusal or failure by a subscriber, past subscriber or
the nominee, heir or legal representative of a deceased subscriber to deliver possession to a foreman of land or any other asset resumed by him for breach of conditions of the assignment.
(2) Where any question arises as to whether any
matter referred to for the award of the Registrar is a dispute or not for the purposes of sub-section (1), the same shall be decided by the Registrar whose decision thereon shall be final.
(3) No Civil Court shall have jurisdiction to entertain any suit or other proceedings in respect of any dispute referred to in sub-section (1).”
7. On a reading of the said provision it can be clearly
seen that not only the writ petitioners, who are disputing their liability for the failure on the part of the principal debtor to pay the amount, but the appellants are also entitled to invoke the provisions of section 64 in order to resolve any disputes raised by any of the parties to the chit transactions.
8. What was weighed with the learned single Judge is
the contention advanced by the writ petitioners that they have not executed any document in favour of the appellants to recover any money on account of the default on the part of the 6th respondent to pay the chit amount. It was in that background that the learned single Judge have pre-empted the appellants from attaching the salary of the writ petitioners, and left open the liberty of the appellants to recover the amounts by any means known to law other than by way of recovering the amounts from the salary of the writ petitioners.
9. Facts and circumstances being so, we do not think the appellants have made out a case of jurisdictional error or other legal infirmities persuading us to interfere with the
judgment of the learned single Judge in an intra court appeal.
Needless to say, appeal fails. Accordingly, it is dismissed. Pending interlocutory applications, if any, shall stand closed. Sd/- S. Manikumar Chief Justice Sd/- Shaji P. Chaly Judge vpv //true copy// P.A. to Judge