Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(Online)(SCDRC) 3000

STATE CONSUMER DISPUTES REDRESSAL COMMISSION
Ravi Shankar, Judicial Member, Sunita C. Bagewadi, Lady Member
President, Sri Ram Gruh Nirman Sahakar Sangh Niyamit – Appellant
Versus
Shivappa Veerappa Dhotarad – Respondent
Appeal Execution No.05/2025 | Appeal Execution No.06/2025 | Appeal Execution No.07/2025 | Appeal Execution No.08/2025 | Appeal Execution No.09/2025 | Appeal Execution No.10/2025 | Appeal Execution No.11/2025 | Appeal Execution No.12/2025

Advocates:
For the Appellants/Petitioners: Rajath H.V
For the Respondents: C.V. Hiremath

Appellate courts will not permit the relitigation of the merits of a consumer complaint order during execution proceedings if the original order has attained finality; directors of a cooperative society remain accountable for satisfying deposit refunds despite claims regarding the timing of their appointment.

Headnote:(A) Consumer Protection Act, 2019 - Section 72 - Non-compliance of consumer commission orders - Execution proceedings - Conviction of society directors - Directors disputed liability claiming they were not office bearers during the period of FD investment - Court held that original orders against the society had attained finality and could not be challenged in execution proceedings - Directors are collectively responsible for the recovery and repayment duties of the society - Court directed District Commission to oversee property sale and recovery proceedings to settle depositors' claims.

(B) Appeal - Maintainability - Challenge to original consumer complaint orders after conviction in execution proceedings is an attempt to delay compliance and bypass the mandatory fee deposit requirement.

Facts of the case:
Complainants filed consumer complaints for non-refund of matured FD amounts. District Commission ordered repayment but the society failed to comply. Execution proceedings under Section 72 of the CPA 2019 were initiated. The society directors were convicted and subsequently preferred these appeals, contending they were not personally liable as they were not in charge at the time of investment.

Findings of Court:
The appellate commission found that the society's misappropriation was established, and the original orders were final. The directors were ordered to facilitate recovery from borrowers or property sales under the court's supervision.

Issues: (1) Whether directors can challenge liability in execution proceedings when the original order attained finality? (2) Whether misappropriation during the appellants' term justifies their personal accountability?

Ratio Decidendi: If an original consumer commission order attains finality, the merits of the case cannot be relitigated in execution. Directors of a cooperative society cannot shirk their responsibility to refund depositors by claiming they were not in office at the time of deposit if fiduciary duty exists.

Result: Appeals dismissed.

COMMON ORDER

HON'BLE BY SMT.SUNITA C. BAGEWADI, MEMBER

The Appellants/Opposite Parties being aggrieved by the order dated 29.5.2025 passed by the District Consumer Commission, Gadag in EA Nos.36/2023, 37/2023, 39/2023, 40/2023, 41/2023, 42/2023, 43/2023 and 45/2023 respectively and prays to set-aside the order passed by the District Commission and allow the appeals, in the interest of justice and equity.

The Appellants/Opposite Parties is the same in all these Appeals and Respondents are different in all the appeals and the facts involved in these Appeals are one and the same. Hence, these Appeals are taken up together and are being disposed of by a common order.

The brief facts of the complaints are that, the complainants have filed a consumer complaint before the District Commission, Gadag, against the respondents for deficiency of service for non-refund of the actual matured FD amount to the complainants. After hearing, the District Commission allowed the complaints directing the Opposite Parties to pay the maturity amount of the FDs along with accrued interest from the date of maturity till realization and Rs.5,000/- towards cost of the proceedings. However, the Opposite Parties have not complied the order passed by the District Commission, Gadag, hence no option to left the complainants have filed execution proceedings against the appellants under section 72 of CP Act, 2019. The District Commission admitted the execution petitions, took the cognizance under Section 72 of the CP Act, 2019, record its sworn affidavit and summons were issued to the Accused No.1 to 14. The appellants No.1 to 14 appeared through their counsels and released on bail. Plea were recorded, after recording 313 statement of the accused, defence evidence of the accused recorded heard arguments and passed the conviction order against the appellants No.1 to 14. Aggrieved by the said order, the said appellants preferred these appeals.

Perused the appeal memos, the appellants in appeal memo contended that the order passed by the District Commission is not in accordance with law and also contended that, the appellants were not the necessary parties as the appellants were not Directors of the society at the time of alleged FD amount were invested by the respondents. Further the respondents have not made the previous Directors of Sri Ram Gruh Nirman Sahakari Sangh Niyamith, Nargund as a party to the proceedings. Further the respondents have not made the society as a party to the proceedings before the District Commission; there is no relationship between the appellants and respondents. They are not independently liable to pay the maturity FD amount to the respondents. Without taking into consideration these facts, the District Commission only on considering the daily newspaper "Vijayavani" published on 14.7.2021 regarding the misappropriation of the funds by the appellants allowed the complaints in part.

Perused the order passed by the District Commission, we noticed that as per the appellants the former President of the society Mr.Jagath, who passed away on 13.9.2021 misused the position and issued deposit receipts to the respondents in relation to their personal financial transactions. These appellants were unaware of the said facts; they are not the Chairman, Vice-Chairman, CEO and Directors of the Society. The appellants relied on the decision of the Hon'ble Supreme Court of India reported in (20) 18 SC wherein, the Hon'ble Supreme Court of India observed that "when no order passed against the appellants by the District Commission in its individual capacity, left open to the State Commission to consider the plea whether the appellant can be imprisoned or not in absence of any order by the District Commission imposing personal liability on the appellants". However perused the order, the appellants after service of notice in complaints appeared through their counsels and contested the matter as a President, Vice-President, C

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