The main legal point established in the judgment is the validity of the award against the petitioner and the direction for the petitioner to seek waiver of penal interest through a fresh representation.

JUDGMENT

(Prayer: Writ Petition is filed under Article 226 of the Constitution of India, praying to issue a Writ of Certiorarified Mandamus, calling for the records relating to the impugned Auction Sale Notice made in E.P.No.33/04-05 dated 20.10.2017 issued by the 1st respondent herein, quash the same, consequently direct the respondents to re-assess the liability by applying 6% interest on the principal of Rs. 3,75,000/-.)

1. Challenging the Auction Sale Notice dated 20.10.2017 in E.P.No.33/04-05 issued by the 1st respondent, the 1st petitioner (deceased) has come up with this writ petition.

2. According to the petitioners, the 1st petitioner is owner of the subject property with an extent of 1755 sq.ft., comprised in S.No.141/1 (Part), Alanthur Village. He applied for housing loan of Rs.4,00,000/- before the 2nd respondent/Society and he was sanctioned only with a sum of Rs.3,75,000/-. According to the petitioners, the 1st petitioner has repaid a sum of Rs.4,20,148/-. But however, all the payments made by him were appropriated towards interest and not towards principal. The 2nd respondent/Society has initiated Execution Proceedings in E.P.No.33/2004-2005, dated 30.04.2010 for recovery of Rs.12,64,420/- from the petitioner, towards principal loan amount and interest thereon. The 1st petitioner sworn in his affidavit that earlier the 2nd respondent issued auction sale notice dated 30.04.2010 and it was challenged by the 1st petitioner in C.M.A.No.2 of 2010 on the file of the Special Tribunal for Co-operative Cases, Chengalpattu. The said CMA was dismissed for default. After a lapse of 7 years, again the 1st respondent has issued the impugned auction sale notice in E.P.No.33/04-05, dated 20.10.2017 to bring the property mortgaged by the 1st petitioner as a security for the loan borrowed by him. Aggrieved by the auction sale notice, the 1st petitioner has filed this writ petition.

3. While pending the writ petition, the 1st petitioner/V.S.Padmanabhan died and his legal heirs are impleaded as 2nd to 4th petitioners in this writ petition vide order dated 28.07.2022 in W.M.P.No.10521 of 2021.

4. The learned counsel for the petitioners assailed the auction sale notice on the following grounds:-

(i) The copy of the award passed against the petitioner was not served on him and therefore, it should be treated as non-est in the eye of law. In support of the said contention, he relied on the decision of the Hon'ble Apex Court in R.Sulochana Devi vs. D.M.Sujatha reported in (2005) 9 SCC 335.

(ii) In the auction sale notice, the amount to be recovered from the petitioner has not been mentioned and hence, the notice is bad for non-compliance of provisions of Rule 126 (e)(iv)(C) of the Tamil Nadu Co-operative Societies Rules, 1988.

5. The learned counsel for the petitioners further submitted that the 2nd respondent/Society charged interest at the rate of 17.5% per annum, which is on higher side. He also submitted that, the petitioners are ready to pay the outstanding amount, if the waiver of penal interest is considered by the respondents.

6. Mr.M.R.Murugan, learned counsel for the 2nd respondent submitted that already the 1st petitioner has suffered an award and the same has become final, as he failed to challenge the same in the manner known to law. Therefore, it is not open to him to question the quantum of amount due from the petitioner as mentioned in the auction sale notice. He further submitted that an on today, there is no Loan Waiver Scheme in operation and therefore, the petitioners request for waiver of penal interest portion cannot be considered.

7. It was submitted that while the loan waiver scheme was in operation, the petitioners failed to avail the same and hence, it is not open to the petitioners to make a request for waiver of penal interest at the later stage.

8. The order impugned in this writ petition is a auction sale notice issued by the 1st respondent under Rule 126 (2) of the Tamil Nadu Cooperative Societies Rules, 1988 framed