Mohammed Tajuddin v. Srinidhi Chits

Mr. G. Veerabhdram S/o. Atchaiah

2. The Hon'ble Deputy Registrar of Chits and District Registrar,, Warangal, Warangal District. ... . Respondents

3. Mohammad Amjad Ali. S/o Nazeer, Age 42 Years, Occ. Government Emp^loyee, R/o. H. No 5-8-197, Rahmat Nagar, Near Bharath Gas Nalgonda- 508001.

4. Juluri Kishore, S/o. [/]allaiah, Age. 38 Years, Occ. Government Emplovee, E/g tl.no 20-5-31, Fort Warangal West, Near Govt. Hospital, Waianlat- 506005 (Respondents No's 3 and 4 are not necessary parties to this petition ) .,.RESPONDENTS/OPPONENT NO'S.3 AND 4 lA NO: 1 OF 2023 - Petition under Section 151 cpc praying that in the c rcumstances stated in the affidav,t filed in support of the petition, the High Corrr . may be pleased to STAY of all further proceedings in pursuance of the E a,ard and recovery certificate passed in AA/CFlNo. 421 of 2021 , on the file r f the Hon,ble Deputy Registrar of Chits Warangal Drstrict at Hanamkonda dated ZO_11_2021 . including execution proceedings in E.p. No. 31 of 2023. ) rthe fire of Hon,bre Principal Junior Civil Judge at lr/lahabubabad. Counsel for the Petitioners:SRI. K VENUMADHAV Counsel for the Respondent No.1 : SRl. N AMARNATH Counsel for the Respondent No.2 to 4 : The Court made the following: ORDER THE HON'BLE JUSTICE B,R.MADHUSUDHAN RAO cRP.NO.3785 0F 2023 ORDER

1. The Civil Revision Petition is filed under Article 227 of the Constrtution of India assailing the award and recovery certiFicate passed in AA/CF/N}.42'J, of 2021 dated 20.11.2021 by the Deputy Registrar of Chits Warangal District at Hanamkonda.

2. Petitioners are opponent Nos.1, 2 and 5 and respondent No.1 is the disputant in AA/CFINo.427 of 2027 and respondent No.2 is the Deputy Registrar of Chits.

3. It is stated in the cause title of the Civil Revlsion Petition that respondent Nos.3 and 4 are not necessary parties to the petition-

4.1. Learned counsel for the petitioners submits that the award and recovery certificate passed by the Deputy Registrar of Chits, Warangal is erroneous in Law and against the material available on record. Respondent No.2 failed to follow the procedure enunciated under Rule 50 of A.P. Chit Funds Rules, 2008, The award and recovery certificate issued is illega l.

4.2. Respondent No.1 now taking advantage of the ex parte award and recovery certificate initiated execution proceedings in E.P.No.31 of 2023 which is pending on the file of Principal lunior Civil Judge at 2le LlRX,lR.l cRP 3785 2023 - Mahabubabad. Respondent No.1 has not adduc_. J any evidence with regard to the amount claimed by them, award trr Rs.91,716/_ with interest @ 18% per annum on the principal amcr ^t of Rs.g0,725l- is awarded from the date of filing till the date of re L:ation with costs of Rs.3,995/-.

4.3. The learned Deputy Registrar of Chits, VVarangal has not assigned any reasons as to how the said amounts E 1: to be paid by the petitioners - opponent Nos.1,2 and 5. In supp< r has relied on the decision of this Court in Jor r Hamsika Chit Funds pvt. Ltd.,r. of his contentions Venkatamma Vs. l i

5. Learned counsel for respondent No.1 ;.rbmits that the petitioners - o p pon ent Nos.1, 2 and 5 has a remedy , nder Section 70 of the Chit Funds Act and the CRp is not maintainah l, , respondent No.2 has followed the procedure contemprated under (.r i: Fund Rures and rightly passed the award and recovery certifica r , which does not requires interference of this Court. In support o ls contention, he relied on the decisions in (1) punjab National Ban < \r5. O.C.Krishnan2 (2) Mohammed Tajuddin Vs. Srinidhi Chits (ti (terabad) private Limitedj (3) sri G.Thimma Reddy Vs. M/s. Dhanru * chit Fund pvt. Ltd4. ' CRP No.47g of 2024, dated 17.06.2025 of the High Court for thr tlte of Telangana at Hyderabad ' zoot 6 scc sog r cRP No. t599 of 2025, dated 02.05.2025 of the High court for tl : state of Telangana 3le 6sp :7is-zoz3 on recordr perused the materral' 6 1 counse\ Heard learned Nov. the pont'""J:"j::;:;-"r-* ecoverv certrricate t"""t::;;:r,*" ol o' r Disrrict at nunu*nono1 suffers from Procedural H; rf so does it requi X. X*l '01,,.", interrerence s to shov'r that notice to erved as Per the Posta 2and3 oPPonent Nos ' z this Court? The aw I petltioner No'1 ard dated 20 11'2021 opponent t. Notice to Petitioner No'1 is s Nos acknowledqmen and 5 is given by waY of PaPer Publication' eme Court in Kranti Ass ed certain PrinciPles The supr o 5 Ahmed ociates Vs' Masood reads as under: s been to record if such decisions udicial trend has alwaY decisions, dministrative diciallY ' author itY must record reasons in support meant to serve the st not onlY be done ( formulat a) In lndia the l asons, even in a affect anYone Prelu b) A quasi-ludicial f its conc\usions o ( nsigtence on reco c( )t wide r prlnciPle of iusti itmust a\so apPear to rding of reasons ce that justice mu be done as well' dated 02 02 2022 of the High Court for the State of 'felangana '$i111'ef'"3'^^' '&11[iX"'"JJ*' Khan I \ 419 A RN,IR,J cRP 3785 2023 - (d) Recording of reasons also operates as a valid -:l;traint on any possible arbitrary exercise of judicial and q I r:;i-judicial or even administrative power. (e) Reasons reassure that discretion has been er:rcised by the decision maker on relevant grounds and by r Li ;r'egarding extraneous considerations. (f) Reasons have virtually become as indisr:rsable a component of a decision making process a: rlbserving principles of natural justice by judicial, quasi- t clicial and even by administrative bodies. (g) Reasons facilitate the process of judicial r:view by superior cou rts - (h) The ongoing judicial trend in all countries c,) lmitted to rule of law and constitutional governance is i1 iavour of reasoned decisions based on relevant facts. Thi: s; virtually the life blood of judicial decision-making ju; i:ying the principle that reason is the soul of justice. (i) ludicial or even quasi-judicial opinions these j l/s can be as different as the judges and authorities who d: i'/er them. All these decisions serve one common purpose 'rhich is to demonstrate by reason that the relevant factor; l-ave been objectively considered. This is important for sus.lining the Iitigants'faith in the justice delivery system. (j) Insistence on reason is a requirement for ) rl.h judicial accountability and tra ns pa rency. (k) If a judge or a quasi-judicial authority is rct candid enough about his/her decision-making proces ; I hen it is impossible to know whether the person deciding i faithful to the doctrine of precedent or to principles of incre r ontalisJn. sl9 BRMR,J cRP 378s 2023 (l) Reasons in support of decisions must be cogent, clear and succinct. A pretence of reasons or'rubber-stamp reasons' is not to be equated with a valid decision-making process. (m) It cannot be doubted that transparency is the sine qua non of restraint on abuse of judicial powers. Transparency in decision-makrng not only makes the judges and decision makers less prone to errors but also makes them subject to broader scrutiny (See David Shapiro in Defence of Judicial Candor (1987) 100 Harvard Law Review 73t-737); (n) Since the requirement to record reasons emanates from the broad doctrine of fairness in decision - ma king, the said requirement is now virtually a component of human rights and was considered part of Strasbourg Jurisprudence. See Ruiz Torija v. Spain (1994) 19 EHRR 553 at 562 para 29 and Anya v. University of Oxford [2001] EWCA Civ 405, wherein the court referred to article 6 of European Convention of Human Rights which requires, 'adequate and intelligent reasons must be given for judicial decision.' (o) In all common law jurisdictions judgments play a vital role in setting up precedents for the future. Therefore, for development of law, requirement of giving reasons for the decision is of the essence and is virtually a part of 'due process'. "

10. In Aggarwal Dyeing and Printing Works Vs. State of Gujarat and Others6, has observed as under: t 2022 SCCOnline Guj 2530 519 BRMR,J cRP 37?,5 2022 - "At the outset, we notice that it is settled legal ),lsition of law that reasons are heart and soul of the ordl and non communication oF same itself amounts to denial ol e asonable opportunity of hearing, resulting in miscarriage of t stice, This court is bound by the said judgments hereinafter rl'erred to. The necessity of giving reason by a body or ,tr thority in support of its decision came for consideration | (lfore the Supreme Court in several cases. Initially, the Sup r ) ne Court recognized a sort of demarcation between ad I ilistrative orders and quasi- judicial orders but with the pass E Je of time the distinction between the two got blurred and - inned out and virtually reached a vanishing point in the judgr ont of the Supreme Court in A. K. Kralpak v. Union of Ind a ( 1970) 1 SCR 45. The honourable Supreme Court vide jL: Jments in the cases of Ravi Yashwant Bhoir v. District Colle: or Raigad (20L2) 4 SCC 4O7, Sant Lal Gupta v. Modern : ))perative Group Housing Society Limited (2010) 13 SCC I Ii; Kranti Associates Private Limited v. Masood Ahmed Kh; r (2010) 9 SCC 496 and Abdul Ghaffar v. State of Bihar (2r),tl) 3 SCC 258, has expanded the horizon of natural justice i I (l reasons have been treated part of the natural justice. It lr, s; gone to the extent in holding that reasons are heart and : cul of the order."

11. Jogu Venkatamma caset has not dealt with S: lion 70 of the Chit Funds Act, 1982.

12. Learned counsel for respondent No.1 has p:c:d reliance on Section-ru. of the Chit Funds Act, 1982 which reads as r rder: 719 IJRMR,J cRP.378i 2023 '70, Appeal against decasion of Registrar or nominee.-Any party aggrieved by any order passed by the Registrar or the nominee or the award of the Registrar or the nominee under section 69, may, within two months from the date of the order or award, appeal to the State Government".

13. In Punjab National Bank2, the Supreme Court observed at para No.6 which reads as under: ,'6. The Act has been enacted with a view to provide a special procedure for recovery of debts due to the banks and the financial institutions. There is a hierarchy of appeal provided in the Act, namely, filing of an appeal under Section 20 and this fast-track procedure cannot be allowed to be derailed either by taking recourse to proceedings under Articles 226 and 227 of the Constitution or by filing a civil suit, which is expressly barred. Even though a provision under an Act cannot expressly oust the jurisdiction of the Court under Articles 226 and 227 of the Constitution. nevertheless, when there is an alternative remedy available, judicial prudence demands that the Court refrains from exercising its jurisdiction under the said constitutional provisions. This was a case where the High Court should not have entertained the petition under Article 227 of the Constitution and should have directed the respondent to take recourse to the appeal mechanism provided by the Act".

74. In Mohammed Tajuddin3, the High Court observed that the petitioner failed to make out any ground to maintain the present 819 ERMR,.I cRP 378s 2O2l - revision despite availability of alternative remedy unr lr r Section 70 of the Chit Funds Act, 1982 to challenge the award

15. In G.Thimmareddyo, the High Court observed t r t the aggrieved party against the order passed under Section 69 of tlrr Chit Funds Act is to prefer an Appeal to the State Government w t rin two months from the date of the order.

16. No reason could be assigned by the petiticr:r's counsel to demonstrate why the jurisdiction of the High Court i invoked under Article 227 of the Constitution of India when efficacic t ; remedy under Section 70 of the Chit Funds Act is provided. The ( ( (isions cited by respondent No.l counsel are applicable to the case or t;lnd.

77. The petitioners are relegated to prefer an al)eal before the State Government under Section 70 of Chit Funds A l. 1982. If such appeal is preferred within a period of 4 weeks from tor tiy the same be entertained, decided and disposed of on merits withot t t.aising an issue with respect to limitation subject to compliar: I of statutory requirements. The State Government to decide ar( dispose oF the appeal and the issue without in any way being influerc:J by any of the observations made by this Court.

18. It is made clear that this Court has not exprt s sed any opinion on the merits of the case in favour of either of the patt es. e19 BRMR,J cRP_378s 2023

19. The order pronounced in the CRP cannot be used as a binding precedent in any other case in view of the peculiar facts and circumsta nces of the case.

20. The Civil Revision Petition is disposed of granting liberty to the petitioners to prefer an appeal before the appropriate Authority under Section 70 of the Chit Funds Act, 1982 as indicated in the order without costs. Interim Orders if any shall stands vacated Miscellaneous application/s stands closed. SD/- A SREENIVASA REDDY ASSISTANT REGISTRAR ,4/rY //TRUE COPY// SECTION OFFICER To,

1. The Deputy Registrar of Chrts Warangal Distrlct at Hanamkonda 2 One CC to SRI K VENUIVIADHAV Advocate [OPUC] 3. One CC to SRI N AMARNATH Advocate [OPUC] 4. Two CD Copres GE/PSL N/ HIGH COURT DATED:04/11/2025 ORDER CRP.No.3785 of 2023 DISPOSING OF THE CRP WITHOUT COSTS A 9tln1 \rr, Irr' ) ,k. ', ') C) J s ^1( llll( :l q' * t l i -- $p61r r .\i__-i_