High Court · 2025

Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to suspend the GO. Rt. No. 923, Home (Passports) Department, dt. 2210612021 issued by the 1st Respondent attaching the Petitioners property bearing H/No" 3- '1-263 (previously, 1-351C117), on Plot No. 17, admeasuring 289 Sq. Yds. in Survey Nos.36,37, 38 and 39 at Mythrinagar Colony, Bahadurguda Village, Saroornagar Mandal, Ranga Reddy Dist. under Crime No. 4912020 of CCS, DD, Hyderabad and all consequential proceedings pending disposal of the Writ Petition lA NO: 1 OF 2022 Between: '1 . The State of Telangana, Rep. by its Prl. Secretary, Dept. of Home, Secretariat Buildings, Saifabad, Hyderabad, Telangana. 2. The Commissioner of Police, Hyderabad City, Telangana 3. lnspector of Police, WCO Team-Xl, CCS, DD, Hyderabad City, Telangana AND ...PETITIONERS/RESPONDENTS

1. Soma Sai Baba, S/o. Soma Ramulu, Aged about 54 years, Occ. Business, R/o. H/No. 11-6-539, Flat No. 101, Gulmohar Apartment, Red Hills, Nampally, Hyderabad, Telangana - 500001

2. Smt. Soma Laxmi, Wo. Soma Sai Baba, Aged about 47 years, Occ. Homemaker, Fl/o. H/No. 11-6-539, Flbt No. 101, Gulmohar Apartment, Red Hills, Nampally, Hyderabad, Telangana - 500001

3. The Commissioner, And lnspector General of Registration and Stamps, Telangana, Hyderabad.

4. The Sub-Registrar, Saroor Nagar Mandal, Ranga Reddy Dist., Telangana ...RESPONDENTS/PETITIONERS Petition under Section 151 CPC praying that in the circumstapees stated in the affidavit filed in support of the petition, the High Court may be pleased to vacate the interim order daled 0211212021 in W.P.No.31760 of 2O21 daled 0211212021 Counsel for the Petitioners: SRI K. VIVEK REDDY REP., FOR SRl. M PR^ATHEEK REDDY Counsel forthe Respondent Nos.1 to 3: SRI MAHESH RAJE GP FOR HOME Counsel for the Respondent Nos.4&5: cP FOR STAMPS AND REGISTRATION The Court made the following: ORDER i l HONOURABLE SRI JUSTICE B. VIJAYSEN REDDY WRIT PETITION No.31760 OB 2021 ORDER: .1.1. The petitioners claim to be absolute owners and possessors of the land and building premises bearing House No.3-1-263 (Old House No.1-35lC/17) consisting of ground + three upper floors on Plol No. 17, admeasuring 289 square yards in Survey Nos.36' 37 , 38 and 39, situated at Mythrinagar Colony, Bahadurguda Village, Saroornagar Mandal, Ranga Reddy District, having purchased the same under the registered sale deed bearing document No.l66512020 dated 24.02-2020 from one Mr. Kacham Kiran Kumar (hereinafter referred to as 'accused'), Son of Kacham Venkataiah, who earlier purchased the same under the registered sale deed bearing document No.5227 of 2013 dated 19.08.2013 from one Mrs. P. Sirisha, wife of Mr. Surender Reddy.

1.2. The petitioners are aggrieved by the impugned-G.O. Rt. No.923, Home (Passports) Department, dated 22.06'2021, issued by respondent No.l - the State of Telangana, represented by its Principal Secretary, Department of Home, Secretariat Buildings, Hyderabad, whereby subject property has been provisionally attached under ) B!'&' Sections 3 and 5 of the Telangana Protection of Depositors of Financial Establishments Act 1999 (for short 'Act 1999').

1.3. The relevant portion of the impugned order of attachment reads as under: "ln the circumstances reported by the Commissioner of Police, Hyderabad City, in his letter read above, Government have examined the matter carefully and hereby issue an ad-interim order under Sections 3 & 5 of the 'felangana Protection of Depositors of Financial Establishments Act, 1999, for the attachment of immovable properties ol Sri Kacham Kiran Kumar (A- l ) in Cr.No.49l2020 of CCS. DD, Hyderabad as shown in the Arnexure appended to this order."

1.4. Consequently, respondent No.2 - the Commissioner of Police, Hyderabad City, Telangana, requested respondent No.4 - the Commissioner & Inspector General of Registration & Stamps, Telangana, Hyderabad. to take further action to disallow any further transactions pertaining to the subject property and othei attached properties

1.5. It is stated that Crime No.49 of 2020 of the Central Crime Station, Detective Deparlment, Hyderabad, was registered on the I 3 BVR.' complaint lodged by one Mr. Nazeer Ahmed wherein it was alleged that himself along with two others deposited chit amount of Rs.76,00,000/- (Rupees seventy six lakhs only) in a chit business organised by the accused. tnstead of retuming the money deposited' the accused sold out his house, the subject property, and avoided payment of amount' During the course of investigation' the accused confessed to have run illegal chit fund business and cheated gullible public to a tune of Rs.4,90,00,000i- (Rupees four crores ninety lakhs only).

1.6. The case of the petitioners is that they have purchased the subject property from the accused by paying valuable consideration and. are in possession of the same' The petitioners do not have knowledge of the alleged crime and chit business being done by the accused. The subject property was purchased by the accused almost a decade ago vide registered sale deed bearing document No'5227 of 20l3dated19.08.2013fromoneMrs.P.Sirisha.Thead-interimorder of attachment under the impugned G'O' is illegal and in clear violation of provisions of the Act 1999, more particularly, Section 8 of the Act 1999 as the Special Court alone is empowered to pass order of attachment of property which is in the hands oftransferee' I I 4

2.1. The case of the respondents is that the subject property claimed by the petitioners is crime property in Crime No.49 of 2020 registered for the offences under Sections 406 and 420 of the Indian Penal Code 1860 (IPC) and Section 5 ofthe Act 1999 and Section 76 of the Chit liunds Act 1982. The petitioners purchased the subject property from the accused knowing pretty well that it is a crime property. The accused constructed building in the subject property with the ill-gotten money. On receipt of complaint liom one Mr. Nazeer Ahmed regarding chit fund amount fraud committed by the accused to the tune of Rs.76.00 lakhs, crime was registered. It was found that the accused has sold the subject property for a sale consideration of Rs.3,20,00,000/- (Rupees three crores twenty lakhs only). During interrogation, the accused pleaded guilty and admitted that he cheated the chit members and depositors for his personal needs and pharma business.

2.2. lt is submitted that investigation revealed that the accused h:,as started several chit groups and accepted deposits from the gullible chit members without any valid licence for the last fifteen (15) years and collected deposits f'rom LWs.l to 19 to a tune of Rs.23,33,259/- (Rupees twenty three takhs thirty three thousand and two hundred and \ 5 fifty eight only) in the guise ofpharma business to provide huge profits in a short period. When the accused was in financial crisis in pharma business, he decided to close the chit business by duping the innocent chit members and pharma investors. When the chit members started demanding for retum of their chit amounts, the accused hatched a plan to windup chit business and he transferred some properties to his brother's name, disposed of some properties and shifted to Bangalore along with his family members. The accused cheated the chit members approximately to a tune of Rs.2,73,30,000/- (Rupees two crores seventy three lakhs and thirty thousand only) for his wrongful gain and committed breach of trust by misappropriating the chit / deposit amounts.

2.3. Based on the letter dated 06'04'2021 addressed by respondent No.2, respondent No.1 vide the impugned G'O' Rt' No'923 dated22.06.2021 issued ad-interim order under sections 3 and 5 0f the Act 1999 for attachment of immovable properties of the accused in Crime No.49 of 2020. I -'l 6

3. Heard Mr. K. Vivek Reddy, leamed senior counsel, representing Mr. M. Pratheek Reddy, learned counsel for the petitioner, and Mr. Mahesh Raie, learned Govemment pleader for Home, and perused the material on record. 4, The leamed senior counsel appearing for the petitioner submitted that the issue involved in this writ petition is squarely covered by the judgment of the erstwhile High Court of Andhra Pradesh in M/s. The Madanapalle Hospitals (p) Ltd. v. The Government of Andhra Pradesh, Home Departmentt. By referring to Sections 3 and 8 of the Act 1999, the learned senior counsel subrnitted that Section 3 of the Act 1999 deals with power of the Govemment to attach the subject property which is in the hands of the I accused - financial establishment; Section 8 of the Act 1999 deals with the power of the Special Court to order attachment of properties which are in the hands of transferees / purchasers. The subject property is admittedly purchased by the peritioners who are a third"pirty and transferees. The accused is no more having interest in the subject property. Thus, the impugned C.b.'t unsustainable. I 2oo9 scc online AP 200 : 7

5. The leamed Govcrnment Pleader for Home submitted that remedy available to the petitioners is to approach the competent Court under the provisions of the Act 1999 and seek release of the attachment order or approach this Court under Sections 397 and 482 of the Code of Criminal Procedure 1973. A detailed enquiry is necessary to be conducted to find out complicity of the accused and whether purchase of the subject propefty by the petitioners is bona fide transaction or not? The accused has fraudulently transferred the subject propefty to the petitioners with crime proceeds. Thus, attachment of property under the impugned G.O. is valid. The petitioners have to wait for the outcome of the criminal proceedings.

6. ln The Madanapalle Hospitals' case, it was held as follows: "section 8 of the Act empowers attachment of the properties, which are in the hands of transferees from financial establishments. Recourse can be had to this provision if it is found that the properties, which are attached from the financial establishments, are not sufficient, to meet the liability towards the depositors or the chit subscribers. A significant difference between Section 3 on the one hand, and Section 8 on the other, is that the power to effect attachment under the former is conferred upon the Govemment, whereas in case of the latter, the power is conferred upon the Special Court constituted under Section \.-.-, BVTJ 6 of the Act. Further, before any property, which is in the hands of transl'eree is attached, the Special Court is required to issue notice to the affected parties. It is only when a finding is recorded by the Special Court that the transfer was made, otherwise than in good faith, and not for valuable consideration, that the attachment under Section 8 of the Ac1 can be ordered. In the instant case, the property that was already sold by the fourth respondent in favour of the petitioner is sought to be attached through the impugned G.O. issued by the first respondent. Since the petitioner answers the description of a transferee, steps, if at all, would have to be taken against it only under Section 8 of the Act. It has alreadv been mentioned that the Special Court alone is confened with the power to take steps under Section 8 of the Act. Therefore. the impugned G.O. is patently without jurisdiction. The writ petition is accordingly allowed and the impugned G.O. is set aside. ... ... ..."

7. It is not in dispute that the subject property was purchased by the petitioners (third party) under a registered sale deed bearing document No. 1665 ol 2020 dated 24.02.2020 which discloses that sale consideration of Rs.82,76,500/- (Rupees eighty two lakhs seVenty six thousand and five hundred only) was paid by them and the petitioners are in possession of the subject property. The issue involved herein is the jurisdiction of respondent No.l in passing the ad-interim attachment order in terms of Sections 3 and 5 of the Act 1999. Section 9 j 8 of the Act I 999 confers power on the Special Court to pass an order of attachment which is in the hands of transferee/s. Hence, this Court does not have any hesitation to hold that decision of this Court in The Madanapalle Hospitals, case referred supra is squarely applicable to the facts ofthe case.

8. Therefore, the writ petition is allowed setting aside the G.O. Rt. No.923, Home (Passporrs) Department dated 22.06.2021 issued by respondent No.1 attaching the subject property. The respondents are given liberty to invoke the provisions of the Act 1999 and seek for attachment of the subject property in accordance with law. At the same time, the petitioners are also given liberty to raise legal contentions opposing attachment of the subject property including applicability of the provisions of the Act 1999 to the chit fund transactions. No order as to costs. As a sequel thereto, miscellaneous applications, if any, pending in the writ petition stand closed. SDI'A.V.S .PRASAD ASS TANT REGISTRAR I I'TRUE COPY'/ S GTION OFFICER to',r ,n" Prl. secretary' Dept' of Home' Secretariat Buildings' Saifabad' " HYderabad'Telangana' 2. The Commissioner of Police' Hyderabad City' Telangana 3. lnspector of Police' WCO Team-Xl' CCS' DD' Hyderabad City' Telangana Generar of Resistration and stamps' o +:i"ffs1',ii???:;xf '"spector ./

5. The Sub-Registrar, Saroor Nagar Mandal, Ranga Reddy Dist.' Telangana 6. One CC to SRI M PRATHEEK REDDY Advocate [OPUC] 7. Two CCs to GP FOR HOME,High Court for the State of Telangana. [OUT] B. Two CCs to GP for Stamps and Registrations, High Court for the State of Telangana at Hyderabad. [OUTI I

9. Two CD Copies KKS/BSKw CC TODAY .1 HE ST4 } € z c O 6 IIAB 2[25 a? c o {k HIGH COURT DATED:2710212025 \ \ ORDER WP.No.31760 ot 2021 ALLOWING THE WRIT PETITION WITHOUT COSTS .oe&A \b E