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2024 Supreme(Ker) 566

IN THE HIGH COURT OF KERALA AT ERNAKULAM
M.A. ABDUL HAKHIM, J.
Keezhmadu Service Co-Operative Bank – Petitioner
Versus
The Assistant Registrar of Co-Operative Societies – Respondent
W.P. (C) Nos. 27416, 28342 of 2021
Decided On : 12-06-2024

Advocates:
Advocate Appeared:
For the Petitioners: Ajai John, V.M. Sajan.
For the Respondents: M.P. Ashok Kumar, Bindu Sreedhar, K.B. Sony, Asif N.

IMPORTANT POINT
The main legal point established is that the Code of Civil Procedure is not applicable to the execution proceedings of the Arbitration Award under the Act, and there is no abatement if the legal representatives are not impleaded.

Headnote:

Arbitration Award - Execution Proceedings - Kerala Cooperative Societies Act, Section 69 - Rule 74(4) of the Kerala Co-operative Societies Rules, 1969

Fact of the Case:

The case involves two writ petitions arising from the same Arbitration proceedings related to a loan default. The first petition seeks direction to complete execution proceedings, while the second challenges the ex-parte nature of the award and demands impleading of the petitioners as legal representatives of the judgment debtor.

Finding of the Court:

The court found that the execution proceedings cannot proceed without impleading the legal representatives of the deceased judgment debtor. It rejected the claim that the award was ex-parte and directed the bank to proceed with execution only after impleading the legal representatives.

Issues: The legal issues involved were the applicability of the Code of Civil Procedure to execution proceedings and whether there is abatement if the legal representatives are not impleaded.

Ratio Decidendi: The court held that the Code of Civil Procedure is not applicable to the execution proceedings of the Arbitration Award under the Act. It also ruled that there is no abatement in case the legal representatives of the deceased judgment-debtor are not impleaded in the execution proceedings.

Final Decision: The court dismissed one writ petition and directed the bank to proceed with execution only after impleading the legal representatives of the deceased judgment debtor.

JUDGMENT :

M.A. ABDUL HAKHIM, J.

1. Since both these writ petitions arise from the same Arbitration proceedings, I dispose both the writ petitions by a common judgment. The parties and documents are referred to according to the description in W.P. (C) No. 28342/2021.

2. The husband of the 1st petitioner and father of 2nd and 3rd petitioners, Sri. Velayudhan N.P. availed of a loan of Rs. 3,00,000/- from the 1st respondent Co-Operative Bank on 10.06.2008. On account of the default in repayment of the loan amount as per the Loan Agreement, the 1st respondent initiated arbitration proceedings under S.69 of the Kerala Cooperative Societies Act (‘the Act’ in short) and obtained Ext.P2 Arbitration Award dated 28.11.2011 in ARC No. 3087/2011 against the said Sri. Velayudhan N.P. after giving notice to him. The 1st respondent Bank instituted execution proceedings through the 2nd and 3rd respondents. The said Sri. Velayudhan N.P. received notice in the execution proceedings. Subsequently, he died on 24.02.2013.

3. W.P. (C) No. 27416/2021 is filed by the 1st respondent impleading the legal representatives of Sri. Velayudhan N.P. as respondents 3 to 5, seeking direction to the 2nd and 3rd respondents to complete the execution proceedings including sale of the mortgaged property within a time limit.

4. W.P. (C) No. 28342/2021 is filed by the petitioners challenging Ext.P2 award on the ground that it is an ex-parte award and also to declare that the said Award cannot be executed without impleading the petitioners as legal representatives of the judgment debtor under Rule 74(4) of the Kerala Co-operative Societies Rules, 1969 (‘the Rules’ in short).

5. The 1st respondent filed a Counter Affidavit dated 08.07.2022 contending, inter-alia that Ext.P2 award is not an ex-parte award; that the Award was passed after giving notice to the borrower Sri. Velayudhan N.P. that he died after receiving notice in the execution proceedings; that the petitioners are well aware of the execution proceedings; that they are impleaded in the execution proceedings; that 1st respondent had been repeatedly demanding them to settle the loan; that they never contended that they are not parties to the execution petition; the 3rd petitioner has approached the 1st respondent by filing several applications for interest waiver and copies of the loan documents; and that by way of abundant caution, the 1st respondent has filed Ext.R1(m) Petition dated 05.04.2022 to implead and issue notice to the petitioners in the execution proceedings.

6. Heard learned Counsel for the petitioners Sri. M.P. Ashok Kumar, the learned counsel for the 1st respondent Sri. Ajai John representing Adv. Sri. V.M. Sajan and the learned Government Pleader Smt. K.B. Sony for the 2nd and 3rd respondents.

7. The Counsel for the petitioners pointed out that the copy of the Award dated 28.11.2011 in ARC No. 3087/2011 produced by the petitioners as Ext.P2 in the Writ Petition and the copy of the very same Award produced by the first respondent with its Counter Affidavit as Ext.R1(e) varies on material aspects and argued that there could not be two contradictory awards passed on the same date in ARC No. 3087/2011 and hence the Award is inexecutable. I sought instruction from the learned Government Pleader and she confirmed that the details in Ext.P2 are correct and mistakes happened in Ext.R1(e) when another copy was taken from the system when the original award was destroyed in flood. Accordingly, I treat Ext.P2 as the copy of the Award dated 28.11.2011 passed in ARC 3087/2011.

8. The learned counsel for the petitioners argued that the Bank has not impleaded the legal representatives of the original judgment debtor - Sri. Velayudhan N.P. in the execution proceedings within the period of limitation and hence the execution proceedings got abated. According to him, on account of the abatement of the execution proceedings, the orders cannot be given in W.P. (C) No. 27416/2021 to expedite the execution proceedings. Accor

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