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2025 Supreme(Telangana) 1720

IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD 
B.R.Madhusudhan Rao, J.
Janga Vimalakar - Petitioner
Vs.
M/s. Rao Brothers Chit Funds Private Limited - Respondent
CRP.No.3752 of 2023
Decided On : 04-11-2025

Advocates:
Advocate Appeared:
For the Appellant : K Venumadhav
For the Respondent: N Amarnath

Judicial decisions must include clear reasoning to uphold transparency and justice, particularly in administrative and quasi-judicial matters, as supported by established legal principles.

Headnote:The judgment concerns a Civil Revision Petition challenging an award and recovery certificate issued by the Deputy Registrar of Chits under A.P. Chit Funds Rules. The court found procedural defects in the award due to lack of notice and reasons provided, emphasizing the necessity for recording reasons as pivotal for justice and transparency. The main issue revolved around the adequacy of notice prior to an award. The court concluded that the petitions should seek remedies under Section 70 of the Chit Funds Act, emphasizing the necessity of due process and outlining the correct procedures for appeals.

Table of Content
1. introduction of petition and parties involved. (Para 1 , 2 , 3)
2. respondent's argument on the existence of alternative remedies. (Para 5 , 6)
3. discussion on the need for reasons in decision-making and judicial accountability. (Para 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15)
4. final determination supporting the need to appeal under section 70. (Para 16 , 17)
5. conclusion regarding jurisdiction and order. (Para 18 , 19 , 20)

ORDER :

B.R.Madhusudhan Rao, J.

1. The Civil Revision Petition is filed under Article 227 of the Constitution of India assailing the award and recovery certificate passed in AA/CF/No.422 of 2021 dated 20.11.2021 by the Deputy Registrar of Chits Warangal District at Hanamkonda.

2. Petitioners are opponent Nos.1 and 2 and respondent No.1 is the disputant in AA/CF/No.422 of 2021 and respondent No.2 is the Deputy Registrar of Chits.

3. It is stated in the cause title of the Civil Revision Petition that respondent Nos.3 to 5 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. Learned Registrar without issuing notice to the petitioners and giving them an opportunity passed the award. 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 illegal.

4.2. Respondent No.1 now taking advantage of the ex parte award and recovery certificate, initiated execution proceedings in E.P.No.42 of 2023 which is pending on the file of Principal Junior Civil Judge at Mahabubabad. Respondent No.1 has not adduced any evidence with regard to the amount claimed by them, award for Rs.2,27,600/- with interest @ 18% per annum on the principal amount of Rs.2,01,377/- is awarded from the date of filing till the date of realization with costs of Rs.5,465/-.

4.3. The learned Deputy Registrar of Chits, Warangal has not assigned any reasons as to how the said amounts are to be paid by the petitioners – opponent Nos.1 and 2. In support of his contentions has relied on the decision of this Court in Jogu Venkatamma Vs. Hamsika Chit Funds Pvt. Ltd., CRP No.478 of 2024, dated 17.06.2025 of the High Court for the State of Telangana at Hyderabad

5. Learned counsel for respondent No.1 submits that the petitioners-opponent Nos.1 and 2 has a remedy under Section 70 of the Chit Funds Act and the CRP is not maintainable, respondent No.2 has followed the procedure contemplated under Chit Fund Rules and rightly passed the award and recovery certificate which does not requires interference of this Court. In support of his contention, he relied on the decisions in (1) Punjab National Bank Vs. O.C.Krishnan, 2001 6 SCC 569 (2) Mohammed Tajuddin Vs. Srinidhi Chits (Hyderabad) Private Limited, CRP No.1599 of 2025, dated 02.05.2025 of the High Court for the State of Telangana  at Hyderabad (3) Sri G.Thimma Reddy Vs. M/s. Dhanwan Chit Fund Pvt.Ltd., CRP No.652 of 2020, dated 02.02.2022 of the High Court for the State of Telangana  at Hyderabad

6. Heard learned counsel on record, perused the material.

7. Now the point for consideration is : Whether the award and recovery certificate passed by the Deputy Registrar of Chits, Warangal District at Hanamkonda in AA/CF/No.422 of 2021 dated 20.11.2021 suffers from procedural defects? If so does it requires interference of this Court?

8. The award dated 20.11.2021 goes to show that notice to petitioner Nos.1 and 2-opponent Nos.1 and 2 is served as per postal acknowledgment.

9. The Supreme Court in Kranti Associates Vs. Masood Ahmed Khan , [(2010) 9 SCC 496], formulated certain principles which reads as under:

"(a) In India the judicial trend has always been to record reasons, even in administrative decisions, if such decisions affect anyone prejudicially.

(b) A quasi-judicial authority must record reasons in support of its conclusions.

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