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 stay all further proceedings including execution of judgment and decree dated 16.08.2007 in os No.333/2003 on the file of the court of Principal senior civil Judge, Warangal. Counsel for the Appellant : SRl. A.PRABHAKAR RAO Counsel for the Respondent No.1 : SRI DASI RAMESH The Court made the foltowing: JUDGMENT i I : I ; ; l l THE HONOURABLE SMT. JUSTICE K. SUJANA APPEAL SUIT No.67O of2OO7 JUDGMENT: Challenging the judgment and decree dated 16.08.2007 passed in O.S.No.333 of 2003 by the learned Prin<:rpal Senior Civil Judge, Warangal, the present Appeal Suit is hled.

2. The brief facts of the case are that Model Chit Corporation Limited, filed a sr-rit against Mr. P. Shankarachary :rrd four other defendants, seeking recovery of Rs.4,79,95O/- baseci cl a chit fund agreement. The plaintiff alleged that defendant No. defaultcd on payments despite repeated demands and legal rtotices. The defense, particularly defendant No.1, argued that the plaintift engaged in fraudulent practices, including with h,rlding prize amounts, coercing blank cheque submissions, anC failing lo register the chit frtnd properly. The trial Court exam;ned extensive documentary cvidence, including Ex.A9 and E;<.A10, which demonstrated that defendant No. t had not made cirs;h payments for certain installments. The trial Court found that the plaintilf had complied with prior orders, including depositinrl Rs.24,4O0/- as dirccted by the A.P. State Consumer Dispules Redressal Commission. However, the triai Court ruled in favor of the i 2 sxs,J A.S. 0.670 of 2d)7 plaintiff, decreeing the suit amount with 60/o future interest per annum while allowing defendant No. I to withdraw Rs.24,4OOl_ deposited by the plaintiff. The trial Court dismissed IA.No. 1 1 16 of 20O7, stating that the plaintiff had failed to serve notice under Order 38, Rule 5 CPC, but permitted further legal action for attachment if necessary. The judgment reinforced the plaintiffs entitlement to the enhanced claim and rejected the counter arglrments of defendant No. i, citing lack of credible evidence to support his claims of fraud or improper adjustments.

3. Aggrieved thereby, the present appeal suit is filed stating that the order of the trial Court is contrary to law and evidence on record and that the trial Court erred in decreeing the suit despite the absence of sufhcient evidence and improperly allowing I.A.No. 1486/2006, which enhanced the claim from Rs.4,1g,350/- to Rs.4,79,950/-, allegedly barred by limitation. The appellant contends that the trial Court wrongly held them estopped from questioning the registration status of thc chit fund, despite the issue not being raised before the District Consumer Forum.

4. Further, the appellant stated that the chit fund company was unregistered, making the suit amount unrecoverable by law, and that PW. 1 lacked valid authorization to represent the plaintiff. ,7 3 SKS,J A.S,No.670 of 2OO7 He also stated that procedural lapses, including the plaintiff's failure to credit payments made by the appellant, rlt:lavs in prized bid amount disbursement, and the non-payment of Rs.24,400/ - despite consumor forum orders. The appellant c:laims mental agony and financ:ial loss due to delayed payments aerl disputes the 12o1, inLerest awarded on Rs.24,4O0/-, asserting that the conduct of the plaintiff caused substantial harm. The appeal seeks dismissal of the suit, emphasizing procedural irregrLlarities, Iack of authorization, and hnancial prejudice suffered by the appellant.

5. Heard Sri A. Prabhakar Rao, leamed counsel appearing on behalf of the appellant as well as Sri Dasi Ramesh, learned counsel appearing on trehalf of the respondents.

6. Lrarned counsel for the appellant, while argu irtg the matLer, limited his prayer to the extent of the interest awarrle.d by the trial court- According to the learned counsel, the appellant was a successful bidder on 2a.Ol.2OO2 but did not rec.eive the prize amount immediately. Instead, the amount was F,aid in three installments, leaving a balance of Rs.24,000/-. 'I'o recover this balance, the appellant initially filed a petition before the consumer forum, which dismissed his claim. Subsequently, he zLppealed, and the appellate 'I'ribunal directed the respondent-Cornp,any to make D-"' &- 4 sKs'J A.S. 0.6"0 of 2OO7 the payment. Therefore, the appellant contended t'hat interest should not be claimed from 2002, as the amount was not paid on 2A.Ot.2OO2. He requested the Court to remove the interest portion from 2OO2, arguing that he received the amount only in the month being ciaimed from the of September 2002, while interest was month June 2O02'

7. on the other hand, learned counsel for the respondent concurred with the submissions made Lry the learned counsel for the appellant and prayed for a reduction in the interest amount' HefurtherrequestedthisCourttopassappropriateordersin accordance with the facts and circumstances of the case' In light of the submissions made by both learned counsel 8. and upon careful examination of the available material on record' the Court finds merit in the contention of the appellant that the awarded interest should not be calculated from the month June 2OO2. The appellant, despite being declared the successful bidder on 28.01.2O02, did not receive the prized bid amount immediately but was paid in three installments, with the final balance of by the aPPellate until directed Rs.24,0OO/ - remaining unPaid only received the amount in the was compelled to initiate legal Tribunal. Since the aPPellant month September 2002 and 5 SKS.J A.S.No.620 of 2dz proceedings to rocover the balance, it would be rnterest from re month of June 2002. Fur thermore, the respondent concllrs with this reasoning, agreeing tI.at the interest rate awarded by the trial Court should be reduced. uI rJ r-rst to impose

9. In the light of these circumstances, this Court modifies the order of the trial Oourt by reducing the interest rate from l2%o per annum to 60/o per annum, and further directs that the pre_suit interest shall be calculated from the month of Sep:embcr 2002, being the actual date of receipt of the amount by thr: defr:ndants, instead of June 2O02 as originally claimed.

10. Accordingly, the interest on the principal amount of Rs.3,70,O0O/- shall be recalculated at tie rate of 6oh 1_:erannum from September 2OO2 to 15_O7-2003, which comes to Ilt;.21,O25/_. Adding this to the principal of Rs.3,7O,OOO/_ anO he nodce charges of Rs.2SOl , the total amount comes to Rs.3,91,27S/_. This amount of Rs.3,91,275/_ shall carry future interesr. ilt the rate of 6%o per annum lrom the date of the suit, i.e., 29_OZ-2I)O3, till the date of full realization, and the plaintiff shall also be enlitled to the costs of the suit. _-! 6 sKs,J A.S.}{o.67O of 2d)7

11. With the above modification, this appeal suit is allowcd in part. There shall be no order as to costs' As a sequel, miscellaneous petitions pending, if any' shall stand closed. //TRUE COPYII Sd/. B. SATYAVATHI JOINT REGISTRAR ECTION OFFICER To,

1. The Principal Senior Civil Judge at Warangal (Wrth\e 2. One CC to Sri A.Prabhakar Rao ,Advocate (OPUC) 3. One CC to Sri Dasi Ramesh,Advocate (OPUC) 4. Two CD Copies Ks/kam Yt- rds) ,41;.H1i:l-- , :. I r ,- ! ,^f a-, ji;i\. v !7. . \.1, Dl !it\l {.._ i ::- (;i HIGH COURT DATED:16 t06t2025 ,/) .1. .,,/,:. ,,,r i--- r' -) li -r :.' JUDGMENT AS.No.670 of 2001 _l1tly Altowing the Appeat Suit Without costs. C "41d\ #'-. HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD MONDAY ,THE SIXTEENTH DAY OF JUNE TWO THOUSAND AND TWENTY FIVE PRESENT THE HONOURABLE SMT JUSTICE K. SUJANA APPEAL SUIT NO. 670 OF 2OO7 Between: P.Shankara Charv S/o Subba Rao Employee, UDC O/o.AAO/ERO, Parkal. FVo H No.6-4-195, MachiliBazar,Hirii.lona.,WarangalDrstrict ...APPELLANT/DEFENDANTNO.l AND

1. Model Chit Corooratron Lrmrted, Having its Registered Office llnd Floor' Model House' Paniaoutta f-ivieraUad having among other branches a Branch at Warangal M.G Road, nepluiliJiorbrnan. Ch Narsimha Murthi S/oKattama', ,n"'t'rt"3f3"Loi"#Xlr/pLAtNTtFF

275.Bheemaram

2. K.Mohan, S/o.Durgaiah age: 54yrs Occ: Employee O/o AAO/GRC.' Warangal. Rl/o.H.No.1- 3. Md.i-rus."in- S7o Hussarn' Miya, age . 54yrs Occ: Employee, FVo UDC O/o AAO/ERO.,T + rveniiiesrrwaitu, S/o.Sambaiah age:s3yrs occ: Employee, JAO O/o AAo/GRC S C.Venlii neaoy, Sto.uatta Reddy age:5'lyrs Occ: Employee Fyo.H.No.2-4-531 , Ramnagar, Hanamkonrla Ryo.t't.No 5-7-31, Lashkar Bazar, Hanamkonda Hanamkonai Ryo.Ramollawada, Warangal ' Hanamkonda. [R2 to 5 are not necessary Parties] RESPONDENTS/DEFENDANTS 2 TO 5 Appeal U/s 96 of C.P.C against the Judgment and Decree made in O.S.No.333 of 2003 dated 16.0g.2007 on the file of the court ofthe Principal senior civil Judge at warangal. ORDER : This appeal coming on for hearing and upon perusing the grounds of appeal, the Judgment and Decree of the Lower Court and the material papers in the Suit and upon hearing the arguments of Sri A.Prabhakar Rao, Advocate for the Appellant and of Sri Dasi Ramesh, Advocate for the Respondent No.1. This Court doth Order and Decree as follows : 't. That the appeal suit be and hereby is partly allowed' 2. That the pre-suit interest on the PrinciPal amount of Rs.3,70'000/- shall be recalculated at the rate of 67o per annum from September 2022 to 15-07-2003, which comes to Rs.21,025/''

3. That the amount of Rs 3,91,275l- (Principal amount Rs.3,70,000 + 6% interest p.a at Rs.21,0251 + Rs.250 towards notice charges) shall carry future interest at the rate of 6% per annum from the date of suit, i.e 29'07-2003 till the date of full realization.

4. That the plaintiff shall also be entitled to the costs of the suit. 5. That there shall be no order as to costs in this appeal. /TTRUE COPY// Sd/- B. SATYAVATHI JOINT REGISTRAR SECTION OFFICER The tJ|o"l,"t""'"' tivil Judse at waransal HIGH COURT DATED:1610612025 DECREE AS.No.670 of 2007 Partly Allowing the Appeal Suit Without costs. \,1. ,(c"a Yr- - -{^6 flro\a'