# 13 S.C.R.1099 B. S. SHESHAGIRI SETTY & ORS v. STATE OF KARNATAKA& ORS

- **Citation:** [2015] 13 S.C.R. 1099
- **Court:** Supreme Court of India
- **Decided:** 2015-10-15
- **Case number:** Civil Appeal Nos. 8663-8664 of 2015
- **Bench:** T. S. Thakur, V. Gopala Gowda
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/13-s-c-r-1099-b-s-sheshagiri-setty-ors-v-state-of-karnataka-ors-30711
- **Pages:** 32

## Headnote

Karnataka Co-operative Societies Act, 1959 - ss. 89
and 108 - Loan taken by appellants-farmers from Co- c
Operative Bank - By mortgaging their agricultural property
as security -
Failure to repay the loan - Arbitration
proceedings - Ex-parte award in favour of Bank directing
recovery of loan by selling of the mortgaged property -
Auction sale of the property on 27.5.1981-ln the meantime,
D
Government notification notifying to waive off the interest
amount on the loan taken by the borrowers, if they paid the
principal amount by 30. 6. 1983 - Appellants paid the loan
amount- Confirmation of the sale on 10. 12. 1985-Appel/ants
challenged the confirmation of sale and the same was E
dismissed - Review petition u/r.38(5)(a) of Co-operative
Societies Rules challenging the confirmation dismissed as
not maintainable - Revision petition u/s. 108 before Deputy
Registrar, Co-operative Societies dismissed as not
maintainable - Subsequent revision petition u/s. 108 before F
the Minister of Co-operation allowed setting aside
confirmation of sale - Writ petition by auction purchaser as
well as the State challenging the order of Minister - Single
Judge of High Court quashed the order of the Minister- Writ
appeals dismissed by Division Bench of High Court on the
G
ground that the Revision before the Minister was barred by
time- On appeal, held: When justice is at stake, courts should
not adopt a technical or pedantic approach - s. 108 confers
power on the State Government to pass any order in case of H
. 1099
1100
SUPREME COURT REPORTS
[2015] 13 S.C.R.
A any miscarriage of justice in the present case as the
confirmation of.sale was grossly illegal and in contravention
of the government notification - The action of the sale officer
has resulted in deprivation of the right to livelihood of the
appellants guaranteed u/Art. 21 of the Constitution- Hence,
B the present case faffs squarely within the ambit of s.108 -
Moreover, the appellants also cannot be held responsible
for the delay as constant litigation has been carried on by
them -
s. 108 confers power of revision on the State
Government suo moto at time - The Act being a special
C legislation, by virtue of s.29(2) of Limitation Act, power to
condone the delay is available with the State GovernmentThe exercise of power uls. 108 by the Minister must be taken
as suo moto exercise of power - The approach of the High
0
Court was thus, highly pedantic and technical - In the facts
of the case auction-purchaser cannot be said to be a bona
fide purchaser and hence his rights as auction purchaser
cannot be protected - Limitation Act, 1963 - s. 29(2).
E
Allowing the appeals, the Court
HELD: 1.1. If a statute does not prescribe the time
limit for exerci~e of revisional power, it must be exercised
within a reasonable time frame. In the instant case, it is
evident that constant litigation has been carried on by
F the appellants, and therefore they cannot be accused of
suddenly waking up after 13 years to claim their land.
Further, in the context of limitation, it has been held by
this Court in a catena of cases that when what is at stake
is justice, then a technical or pedantic approach should
G not be adopted by the Courts to do justice when there is
miscarriage of justice caused to a public litigant. [Para
16] [1122-F-H; 1123-A]
1.2 Section 108 of the KCS Act confers the power
H on the State Government to pass any order as it may
B. S. SHESHAGIRI SETTY & ORS. v. STATE OF
1101
KARNATAKA& ORS.
deem fit in case there has been a miscarriage of justice. A'
The instant case falls squarely within the ambit of Section
108 of the KCS Act. The appellants have been rendered
landless for more than two decades even after repaying
the loan amount. This amounts to gross miscarriage of
justice caused to the appellants. [Para 17] (1123-F-G]
B
1.3 In the instant case, the fact of repayment of the
principal loan amount to the Bank before the
confirmation of the auction sale, shows that confirmation
of the auction of the i

## Text

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(2015] 13 S.C.R.1099
B. S. SHESHAGIRI SETTY & ORS.
v.
STATE OF KARNATAKA& ORS.
(Civil Appeal Nos. 8663-8664 of 2015)
OCTOBER 15, 2015
A
B
[T. S. THAKUR AND V. GOPALA GOWDA, JJ.]
Karnataka Co-operative Societies Act, 1959 - ss. 89
and 108 - Loan taken by appellants-farmers from Co- c
Operative Bank - By mortgaging their agricultural property
as security -
Failure to repay the loan - Arbitration
proceedings - Ex-parte award in favour of Bank directing
recovery of loan by selling of the mortgaged property -
Auction sale of the property on 27.5.1981-ln the meantime,
D
Government notification notifying to waive off the interest
amount on the loan taken by the borrowers, if they paid the
principal amount by 30. 6. 1983 - Appellants paid the loan
amount- Confirmation of the sale on 10. 12. 1985-Appel/ants
challenged the confirmation of sale and the same was E
dismissed - Review petition u/r.38(5)(a) of Co-operative
Societies Rules challenging the confirmation dismissed as
not maintainable - Revision petition u/s. 108 before Deputy
Registrar, Co-operative Societies dismissed as not
maintainable - Subsequent revision petition u/s. 108 before F
the Minister of Co-operation allowed setting aside
confirmation of sale - Writ petition by auction purchaser as
well as the State challenging the order of Minister - Single
Judge of High Court quashed the order of the Minister- Writ
appeals dismissed by Division Bench of High Court on the
G
ground that the Revision before the Minister was barred by
time- On appeal, held: When justice is at stake, courts should
not adopt a technical or pedantic approach - s. 108 confers
power on the State Government to pass any order in case of H
. 1099
1100
SUPREME COURT REPORTS
[2015] 13 S.C.R.
A any miscarriage of justice in the present case as the
confirmation of.sale was grossly illegal and in contravention
of the government notification - The action of the sale officer
has resulted in deprivation of the right to livelihood of the
appellants guaranteed u/Art. 21 of the Constitution- Hence,
B the present case faffs squarely within the ambit of s.108 -
Moreover, the appellants also cannot be held responsible
for the delay as constant litigation has been carried on by
them -
s. 108 confers power of revision on the State
Government suo moto at time - The Act being a special
C legislation, by virtue of s.29(2) of Limitation Act, power to
condone the delay is available with the State GovernmentThe exercise of power uls. 108 by the Minister must be taken
as suo moto exercise of power - The approach of the High
0
Court was thus, highly pedantic and technical - In the facts
of the case auction-purchaser cannot be said to be a bona
fide purchaser and hence his rights as auction purchaser
cannot be protected - Limitation Act, 1963 - s. 29(2).
E
Allowing the appeals, the Court
HELD: 1.1. If a statute does not prescribe the time
limit for exerci~e of revisional power, it must be exercised
within a reasonable time frame. In the instant case, it is
evident that constant litigation has been carried on by
F the appellants, and therefore they cannot be accused of
suddenly waking up after 13 years to claim their land.
Further, in the context of limitation, it has been held by
this Court in a catena of cases that when what is at stake
is justice, then a technical or pedantic approach should
G not be adopted by the Courts to do justice when there is
miscarriage of justice caused to a public litigant. [Para
16] [1122-F-H; 1123-A]
1.2 Section 108 of the KCS Act confers the power
H on the State Government to pass any order as it may
B. S. SHESHAGIRI SETTY & ORS. v. STATE OF
1101
KARNATAKA& ORS.
deem fit in case there has been a miscarriage of justice. A'
The instant case falls squarely within the ambit of Section
108 of the KCS Act. The appellants have been rendered
landless for more than two decades even after repaying
the loan amount. This amounts to gross miscarriage of
justice caused to the appellants. [Para 17] (1123-F-G]
B
1.3 In the instant case, the fact of repayment of the
principal loan amount to the Bank before the
confirmation of the auction sale, shows that confirmation
of the auction of the immoveable property was grossly C
illegal. The said sale was in contravention of the
notification issued by the State Government in respect
of the borrowers of the Bank, which sought to waive off
the interest on the principal amount if the same was paid
~y 30.06.1983. The said notification was issued on the D
basis of a government order, traceable to Article 162 of
the Constitution of India. Therefore, the sale of the
property and the confirmation of the auction sale is
contrary to the notification and law and has resulted in a
E
gross miscarriage of justice. The action of the sale officer
has resulted in the deprivation of the right to livelihood
of the appellants who are small landowners, guaranteed
to them under Article 21 of the Constitution of India. The
right to livelihood has been held to be an integral part of F
rightto life. [Para 18] (1124-A-D]
Olga Tellis v. Bombay Muncipal Corporation 1985
(2) Suppl. SCR 51: (1985) 3 SCC 545- relied on.
1.4 In the instant case, the deprivation of the land G
of the poor appellants resulted in the deprivation of their
livelihood as well. The courts below in the instant case
which dismissed the claim of the appellants on technical
grounds grossly erred and the same cannot be upheld.
The High Court has erred in setting aside the order of H
1102
SUPREME COURT REPORTS
[2015) 13 S.C.R.
A the Minister of Co-operation, Government of Karnataka
passed in the Revision Petition on the ground that it was
barred by limitation, which approach of the High Court
is highly pedantic and technical and therefore the same
B
cannot be allowed to sustain in law. [Para 19] [1125-E-F]
1.5 Further, Section 108 of the KCS Act confers the
power of revision on the state government suo moto at
any time, or on application by an applicant within 6
months of the passing of an order. The KCS Act is a
C special legislation. Thus, by virtue of Section 29(2) of the
Limitation Act, 1963, the power to condone delay is
available with the State Government. The contention of
the auction purchaser that no such application for
condonation of delay of the belated revision petition has
D been filed by the appellants is a hyper technical one and
cannot be sustained. Where the State Government has
exercised its statutory power under Section 108 of the
KCS Act after satisfying itself that the sale of the
mortgaged immoveable property of the appellants in the
E public auction is illegal, it is not open for the respondents
to contest the same by urging technical grounds,
especially in the light of the fact that the power conferred
upon the State Government under Section 108 of the KCS
Act is 'suo moto' and the same can be exercised 'at any
F time'. Therefore, having regard to the facts of the case,
in the absence of an application for condonation of delay,
it is held that the exercise of the power by the Minister
for Co-operation, State Government of Karnataka must
G be taken as a suo moto exercise of power by him. [Para
20] [1125-G-H; 1126-A-D]
H
State of Haryana v. Chandra Mani & Ors. 1996
(1) SCR 1060: (1996) 3 SCC 132; Dhiraj Singh
B. S. SHESHAGIRI SETTY & ORS. v. STATE OF
KARNATAKA& ORS.
(Dead) through L.Rs. v. State of Haryana & Ors.
(2014) 14 sec 127 - relied on.
V.N Shrikhande (Dr.) v. Anita Sena Fernandes
(2011) 1 SCC 53; Santoshkumar Shivgonda Patil
& Ors. v. Ba/asaheb Tukaram Shevale & Ors.
(2009) 9 sec 352 - distinguished.
State of Gujarat v. Patil Raghav Natha & Ors 1970
(1) SCR 335: (1969) 2SCC187; Collector, Land
Acquisition, Anantnag & Anr. v. Mst. Katiji & Ors.
1987 (2) SCR 387 : (1987) 2 SCC 107 - referred to.
2. The auction purchaser is not a bona fide
purchaser. As per section 89 of the KCS Act which sets
down the procedure of sale, it is imperative that the notice
1103
A
B
c
of the sale to be served on the mortgagor, and the
opportunity be given to him to file his objections. In the D
instant case, the award of the Arbitrator dated 31.05.1975
ordering the sale of land was passed ex parte and the
appellants were not provided any opportunity to
produce their defence and objections to the same. E
Further, the appellants had repaid the principal loan
amount as on 30.06.1983 itself. The confirmation of the
auction sale was ordered on 10.12.1985. It was upon the
auction purchaser to assess the circumstances in which
the auction of the property was being conducted. F
Further, the fact that the actual auction sale had been
conducted on 25.05.1981 will also not come to the rescue
of the auction purchaser. The confirmation of the sale
happened only on 10.12.1985, which was after the
principal loan amount had been repaid by the appellants G
in compliance with the notification issued by the Bank.
In the light of the facts of the present case, the rights of
the auction purchaser cannot be protected as he cannot
be said to be a bona fide purchaser. [Paras 22, 23] (1126·
G; 1128-A·C; 1129-A·B, E]
H
1104
A
. B
SUPREME COURT REPORTS
[2015] 13 S.C.R.
Velji Khimji and Co. v. Official Liquidator of
Hindustan Nitro Product (Gujarat) Limited and Ors.
2008 (12) SCR 1 : (2008) 9 sec 299 - relied on.
Janatha Textiles & Ors. v. Tax Recovery Officer &
Anr. 2008 (8) SCR 1148: (2008) 12 sec 582referred to.
3.1 The confirmation of auction sale of the
immoveable property in question was illegal. The learned
High Court erred in setting aside the order dated 9.2.2004
C of the Minister for Cooperation, State Government of
Karnataka, passed in the Revision Petition. The same is
erroneous and liable to be set aside. [Para 24] [1129-G]
3.2 Respondent no.6-the auction purchaser is
D directed to re-deliver the possession of the immoveable
property to the appellants sold in auction by the sale
officer pursuant to the execution of an award dated
31.05.1975 passed against the appellants and get back
the sale consideration amount of Rs.400501- from the
E respondent Bank within six weeks from the date of
receipt of this order, failing which the respondent Nos.1
to 5 shall take coercive steps against the auction
purchaser or any person claiming through him, with
police help if required, and re-deliver the possession of
F the immoveable property to the appellants and submit
compliance report before this Court. [Para 24] (1130-BD]
Case Law Reference
G (2011) 1 sec 53
. distinguished
Para 13
1970 (1) SCR 335
referred to
Para 13
(2009) 9 sec 352
distinguished
Para 13
1987 (2) SCR 387
referred to
Para 14
H 1996 (1) SCR 1060
relied on
Para 16
8. S. SHESHAGIRI SETTY & ORS. v. STATE OF
1105
KARNATAKA& ORS.
(2014) 14 SCC 127
relied on
Para 17
A
1985 (2) Suppl. SCR 51
relied on
Para 18
2008 (8) SCR 1148
referred to
Para 21
2008 (12) SCR 1
relied on
Para 22
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos.
B
8663-8664 of 2015.
From the Judgment and Order dated 02.07.2012 of the
High Court of Karnataka, at Bangalore in Writ Appeal No. 411
of 2006 c/w Writ Appeal No. 410 of 2006 (CS-RES).
H. Chandra Sekhar,Adv., for the Appellants.
S. N. Bhat and V. N. Raghupathy, Advs., for the
Respondents.
The Judgment of the Court was delivered by
V. GOPALAGOWDA, J. 1. Leave granted in the Special
Leave Petitions.
c
D
2. The present appeals arise out of the impugned
judgment and order dated 02.0~.2012 passed in Writ Appeal
E
Nos. 411 of 2006 and 410 of 2006 by the High Court of
Karnataka at Bangalore, whereby the High Court dismissed
the appeals filed by the appellants, thereby upholding the
judgment and order of the learned single judge passed in Writ
Petition Nos. 22453 of 2004 and 17054 of 2004, setting aside
F
order dated 9.2.2004 passed in the Revision Petition No.
CMW 33 CAP 98 by the Minister of Cooperation on the ground
that the Revision Petition filed by the appellants herein is
barred by limitation and is contrary to the proviSions of Section
108 of the Karnataka Cooperative Societies Act, 1959 G
(hereinafter "KCS Act").
3. Though the case has a chequered history, we refer to
. ·the facts in brief hereunder, which are required to appreciate
the rival legal contentions urged on behalf of the parties:-
H
1106
SUPREME COURT REPORTS
[2015] 13 S.C.R.
A
The appellants are small farmers who had availed a loan
of Rs.16,000/- from the Kadur Taluk Primary Co-Operative
Land Development Bank Ltd. (hereinafter the "Bank") by
mortgaging their entire immoveable agricultural property as
security for the same. These lands were situated at
B Sakkarepatna village of Kadur Taluk, Chikmagalur,
descriptions of which are stated hereunder in survey numbers
and their measurements:
c
552
555
556
557
1 Acre 07 Guntas
0 Acre 38 Guntas
0 Acre 14 Guntas
1 Acre 28 Guntas
4. Admittedly, the appellants initially were able to pay
only one instalment of the loan, and were not able to pay the
D subsequent instalments. The respondent Bank filed a petition
before the Arbitrator of Co-Operative Societies, Chikmagalur
District, which was registered as a case in Dispute D.T.C 75/
197 4-1975. The learned Arbitrator, passed an ex pa rte award
in favour of the Bank by his order dated 31.05.1975, holding
E asunder:
F
G·
H
" ......... it is hereby declared that the amount due to the
petitioner on account of principal and interest and costs
calculated upto 11 1h day of April 1975 is Rs 20.637-23
and that such amount shall carry interest at 12 per cent
per annum from the said date viz. 11.4.1975, until
realization and it is hereby ordered that the said amount
shall be recovered by sale of the schedule mortgaged
properties or a sufficient part thereof and if the amount
.fell due with interest and costs is not realized by the
said sale, the balance shall be recovered from the
respondents personally. The said sum may also be
recovered from the sale of the moveable properties of
the respondents."
B. S. SHESHAGIRI SETTY & ORS. v. STATE OF
1107
KARNATAKA& ORS. [V. GOPALAGOWDA, J.]
On 27.05.1981, the bank conducted the auction sale of the A
immoveable property in public auctions and the bid stood at
Rs.40,050/-. Being aggrieved of the award of the Arbitrator as
well as the sale of the property, the appellants filed an appeal
before the Karnataka Appellate Tribunal, Bangalore. During
the pendency of the appeal, the State Government of B
Kamataka issued a notification in respect of the borrowers of
the Bank, which, inter a/ia, stated as under:
" ......... It is hereby informed to the loan members of
Kadur Taluk Primary Cooperative Land Development C
Bank that as per the Government order, those members
who have the balance by the end of June 1982 and
special discount is given for the .year 1982-83:
1. On 30.06.82 those who had the balance (applicable D
to the suit decreed loans also) if the principal
amount is paid in a single payment before
30.6.1983 interest and compound interest will be
completely exempted ......... "
Pursuant to this offer, the appellant paid to the Bank the entire
remaining loan amount of Rs.7050/-on 30.06.1983, excluding
the interest as he had already deposited an amount of
Rs.9,000/- with the Karnataka Cooperative Society on
07.09.1981.
5. The learned KarnatakaAppellate Tribunal allowed the
appeal filed by the appellants vi de order dated 27 .12.1983,
and remitted the matter back to the Arbitrator, to dispose of
E
F
the same in accordance with law after giving proper notice to G
all the parties. Challenging the said order of the Tribunal, the
respondents filed a Writ Petition before the High Court of
Kamataka, which was allowed by its judgment and order dated
29.11.1985. The learned High Court held on the issue of the
appeal before the Tribunal being barred by limitation as under:
H
1108
A
B
c
D
SUPREME COURT REPORTS
[2015] 13 S.C.R.
"While respondent-4 had filed his app_eal- appeal No.
431 of 1981- after six years. Every one of the reasons
on which those respondents sought of condonation of
delay in filing their reading of the applications should
have rejected that respondents 5 and 6 had not been
served, had condoned the delay in filing the appeal.
Assuming that reason opinion, particularly having regard
to the fact that they were not other than the sons of
respondent-4, who had appeared before the Arbitrator
and had consented for a decree sought by the society.
I am somewhat distressed at the way the Tribunal has
dealt with the appeals and has condoned the inordinate
and inexplicable delay in filing the appeals. On the
principles of regulating the condonation of delay, the
Tribunal should have rejected their appeals also in
/imine. From this it follows that the order of the Tribunal,
which suffers from manifest illegalities in exercise of its
jurisdiction is liable to be quashed."
On the issue of the order of the Arbitrator being passed ex parte
E against the respondents therein, the High Court held as under:
F
G
H
"An award/ decree made against a person, though he
was not served in the proceedings, is never considered
as a decree made without jurisdiction. A decree or an
award against a person who has not been served at
the highest may be an irregularity and does not amount
to a case of inherent want of jurisdiction nullifying such
a decree on that ground. Without any doubt, the view
taken by the Tribunal that the award made by the
arbitrator in 1975 to which respondent-4 consented was
a valid award and there was hardly any ground for the
Tribunal to take exception to the same after six years in
the case of one appeal and after? years in the case of
another appeal. n
B. S. SHESHAGIRI SETTY & ORS. v. STATE OF
1109
KARNATAKA & ORS. [V. GOPALA GOWDA, J.]
Setting aside the order of the Tribunal, the High Court held:
A
"On any view of the matter, the order of the Tribunal which
suffers from errors of jurisdiction and illegality in the
exercise of jurisdiction, had occasioned grave failures
of justice to the petitioner and respondents-? and has B
done doubtful justice to respondents 4 to 6 is liable to
be interfered with by me under Articles 226 and 227 of
the Constitution."
6. The WritAppeal preferred by the appellants against c
the order of the High Court dated 29.11.1985 was dismissed
by the Division Bench of the High Court vide judgment and
order dated 01.03.1990. While upholding the findings of the
learned single judge of the High Court, the Division Bench held
asunder:
D
"In addition to this, we have already noticed from the
order sheet of the Arbitrator produced as Annexure-C .
that the notices were issued to the appellants and the
service of summons on them was held as sufficiel'lt and E
the appellants were treated as ex parte. That being so,
the observation of the Tribunal that the notices were not
served upon the appellants is incorrect. In addition to
this the Tribunal has failed to see that the 5th respondent
appeared and consented for a decree. The appellants
F
and the 51h respondent were living together under one
roof. Hence it is difficult to believe the version of the
appellants that they were not aware of the award. All
that can be said in the instant case is that the explanation
as to the ignorance of the award proceedings is G
opposed to the realities of life."
7. In the meanwhile, on 10.12.1985, the Assistant
Registrar of Cooperative Societies issued a certificate of sale
under Rule 38(7) of the Karnataka Cooperative Societies . H
1110
SUPREME COURT REPORTS
[2015] 13 S.C.R.
A
Rules, 1960 (hereinafter "KCS Rules") in favour of the auction
purchaser S.V. Vijaydev (respondent no.6 herein), thereby
confirming the sale of the lands of the appellants herein.
Aggrieved of the same, the appellants preferred an appeal
under Section 106 of the KCS Act before the Deputy Registrar
B of the Cooperative Societies, Chikmagalur District. The appeal
was dismissed by the Deputy Registrar vide order dated
09.05.1986. While dismissing the appeal, the learned Deputy ·
Registrar held as under:
C
"The appellants have contended that the action of the
Assistant Registrar of Cooperative Societies, is
contrary to law, but they have not specifically mentioned
or proved as to how the confirmation of sale is in
violation of the K.C.S Act or contrary to Rule 38 of the
D
K.C.S Act and the Rules. Therefore the order of
confirmation of sale passed by the Assistant Registrar
of Cooperative Societies is upheld and the appeal is
dismissed."
E
8. The appellants then filed a Review Petition under Rule
38( 5)(a) of the KCS Rules, challenging the order of confirmation
of sale of the immoveable property passed by the Assistant
Registrar of Co-Operative Societies dated 10.12.1985, which
petition ""!as dismissed as not maintainable vide order dated
F
17.08.1996, on the ground that an appeal filed challenging the
same had already been dismissed. Aggrieved of the same,
the appellants then preferred a Revision Petition under Section
108 of the KCS Act, before the Deputy Registrar of Cooperative Societies which was dismissed as not maintainable,
G vide order dated 22.05.1997. The Deputy Registrar held as
under:
'This Court has no jurisdiction to entertain the Revision
Petition filed by the Petitioner under Section 108 of the
H
Cooperative Societies Act, 1959. I am of the opinion
B. S. ~HESHAGIRI SETTY & ORS. v. STATE OF
1111
KARNATAKA & ORS. [V. GOPALA GOWDA, J. ]
that the Revision Petition is liable to be dismissed as A
not maintainable at the preliminary stage of admission."
The appellants thereafter filed a Revision Petition under
Section 108 of the KCS Act before the Minister of Cooperation, Goverhm~nt of Karnataka. By order dated B
09.02.2004, the Minister of Cooperation allowed the Revision
Petition filed by the appellants and set aside the order of Sale
confirmation dated 10.12.1985, as well as the orders of appeal
dated 09.05.1986 and order of Review dated 17.08.1996. It
was h.eld by the Minister as under:
c
" .... I am of the opinion thatthe matter has not been dealt
with in a just manner by the appellate authority. The
subsequent action of the petitioners in filing appeals
before the JRCS have all been exercised in futility D
because the matter was not given thought on merits all
along by the authorities. If it was the claim of the
petitioners that they have managed to repay a
substantial part of the loan i.e the principal' amount before
. the specified date as in the circular dated 02.03.1984 E .
and that therefore they have complied with the condition
as laid outin the circular, it must have been the duty of
the appellate authorities to examine the said contentions
and then decide the matter. keeping in mind the
conditions of the said circular. The issu~ to be decided
F
here is whether 4he petitioners claim to the interest
waiver and consequent benefits are reasonable and
tenable .
. . . It is seen that the amount of loan overdue is not really G
huge. Yet the Sale officer thought it fit to auction 1 acre
and 07.guntas of land to recover a sum of Rs 20, 367/-
with interest. The sale was accepted for an offer of Rs
40,650/-...... .
H
1112
A
B
c
D
SUPREME COURT REPORTS
[2015] 13 S.C.R.
..... From the above arguments it is seen that the sale
Officer. ARCS AND DRCS. all along have latched on to
technical considerations and have not analysed the
matter objectively. It appears that their approach has
been rather narrow and such long drawn litigation could
have been avoided, had the authorities thought in a more
rational manner instead of going into avoidable
technicalities. I am of the opinion that the DRCS should
have examined the facts and circumstances of the
auction sale in the appeals before him and decide the
matter. Available facts indicate that such an effort was
not made and the matter went into litigation for years.
While I am aware the auction sale was held in 1981, i!
is unfortunate that not enough efforts have been made
by the authorities to see the case at hand in an objective
manner and the facts have not been analysed with
respect to the benefit of interest waiver ordered by the
State Government that was intended to reach the needy
farmer. In my opinion, the conditions of loan default that
E
prevailed then, with these petitioners were surely coming
within the ambit of the conditions stipulated in the circular
dated 02.03.1984 which is based on a government
order it would be appropriate to make all efforts to see
that such a benefit reached the persons to whom it was
F
intended to reach in the first place ...... "
(emphasis laid by this Court)
9. The auction purchaser (respondent no. 6 herein)
challenged the aforementioned order of Minister of
G Cooperation dated 09.02.2004 passed in the Revision
Petition, by way of filing Writ Petition No. 17054 of 2004 before
the High Court of Karnataka. The State Government of
Karnataka also challenged the order by way of filing Writ
H Petition No. 22453 of 2004. The learned single judge by a
B. S. SHESHAGIRI SETTY & ORS. v. STATE OF
1113
KARNATAKA & ORS. [V. GOPALA GOWDA, J.]
common judgment and order dated 24.01.2008 quashed the A
order of the Minister dated 09.02.2004. The learned judge held
that the order passed in the Revision Petition was perverse
and arbitrary. It was further held that the benefit of the circular
dated 02.03.1984 was only for the exemption of the interest,
and that the same would not enable the government to set aside
B
the auction of the land which was conducted and confirmed in
December, 1985. It was further held by the learned single judge
that in any case, the said circular was not at all applicable when
the property was transferred to a third party. The appellants
preferred Writ Appeal No.411 of 2006 c/w Writ Appeal No. C
41 O of 2006 questioning the correctness of the order dated
24.1.2008 passed in Writ Petition
No. 17054 of 2004 etc.
The High Court dismissed the appeals, and held that the
Revision Petition filed before the Minister under Section 108 D
was barred by time. The lea med High Court held as under:
"From a reading of the provisions of Section 108, it is
clear that suo moto, the Government, may at anytime
exercise the power of revisions or if it is at the instance
of the party, within six months. In the instant case, the
E
revision petition was filed by the appellants. Therefore,
the appellants were required to file a revision petition
within six months from the date of confirmation of the
same, since the sale is confirmed in 1985. The
appellants could not have filed a revision in 1998, 13
F
years afterthe orders of confirmation. Even if it is held
that suo moto at any time, the Government can exercise
the powers of revision, then also, it has to be exercised
within a reasonable time not beyond a period of three G
years ....
Viewed from any angle, the revision petition allowed by
the Hon'ble Minister was clearly barred by time and the
same is contrary to Section 108 of the Act."
H
1114
SUPREME COURT REPORTS
[2015] 13 S.C.R.
A The Division Bench of the High Court held that no ground for
interfering with the order of the single judge is made out and
the appeals were dismissed. Hence, the present appeals.
10. We have heard the learned counsel for both the
B parties. On the basis of the factual evidence on record produced
before us, the circumstances of the case and also in the light
of the rival legal contentions urged by the learned counsel for
both the parties, we have broadly framed the following points
which require our attention and consideration:-
c
D
E
1.
Whether the Revision Petition filed before the
Minister for Co-Operation is barred by time in light
of the provisions of Section 108 of the Karnataka
Cooperative Societies Act, 1959?
2.
Whether the interest of the auction purchaser is
protected on grounds that he is a bona fide third
party?
3.
What order?
Answer to Point No. 1
11 . The litigation in this case has been quite lengthy, which
has seen multiple hearings before multiple forums. The
F controversy arose in the case when the learned Arbitrator
passed the ex-parte order dated 31.5.1975 against the
appellants. The Karnataka Appellate Tribunal set aside the
same vide order dated 27 .12.1983. The Karnataka High Court
in Writ Petition No. 6642 of 1984 set aside the order of the
G KarnatakaAppellate Tribunal by its judgment and order dated
29.11.1985. On the basis of the judgment in the above
mentioned Writ Petition, the respondent Bank confirmed the
sale of the land of the appellants vide certificate dated
10.12.1985. The appeal filed against the confirmation of sale
H was rejected by the Deputy Registrar of Cooperative Societies
B. S. SHESHAGIRI SETTY & ORS. v. STATE OF
1115
KARNATAKA & ORS. [V. GOPALA GOWDA, J.]
vide order dated 09.05.1986. A Revision Petition was then A
filed before the wrong forum, which was rejected. Then a
Revision Petition under Section 108 of the KCS Act was filed
before the Minister for Cooperation, State Government of
Karnataka. The Minister allowed the Revision Petition and set
aside the confirmation of the sale of the land of the appellants B
in favour of the auction purchaser. The said order of the Minister
was set aside by the learned High Court. To appreciate the
controversy in the instant case, it is imperative for us to examine
the provisions of the KCS Act.
c
12. The KCS Act (Karnataka Act No. 11 of 1959) was
enacted with the aim of providing a uniform co-operative
societies law as applicable to the whole of the State of
Karnataka. The Rural Development Banks are conferred the
power to advance loans, in terms of Section 82-A of the 1<CS D
Act, which reads as under:
"82A. Powers of Land Development Banks to
advance loans and to hold lands. - Subject to the
provisions of this Act and the rules made thereunder, it E
shall be competent for the Agriculture and Rural
Development Banks to advance loans for the purposes
referred to in section 76A, and to hold lands the
possession of which is transferred t<;> them under the
provisions of this Chapter."
F
Chapter XII of the KCS Act pertains to Execution of Awards,
Decrees, Orders and Decisions. Section 99 of the KCS Act
deals with Enforcement of charge as under:
G
"99. Enforcement of charge.- Notwithstanding
anything contained in Chapter IX, or any other law for
the time being in force, but without prejudice to any other
mode of recovery provided in this Act, the Registrar or
any person subordinate to him empowered by the H
1116
SUPREME COURT REPORTS
[2015] 13 S.C.R.
A
Registrar in this behalf, may, on the application of a
cooperative society, make an order directing the
payment of any debt or outstanding demand due to the
society by any member or past or deceased member,
by sale of the property which is subject to a charge under
B
sub-section (1) of section 32"
c
Chapter XIII of the KCSAct pertains to Appeals, Review and
Revision.
Section 105 of the KCS Act provides for appeals to the
Tribunal:
"105. Appeals to the Tribunal.-Any person aggrieved
by,-
D
.........
( c) any award of an Arbitrator under clause ( c) of subsection (1) of section 71;
E
may, within sixty days from the date of the decision,
award or order, as the case may be, appeal to the
Tribunal."
Section 108 of the KCS Act confers powers of revision on the
F
State Government as under:
G
H
"108 .. Powers of revision of State Government.-
[Subject to the provisions of section 108A, the State
Government] suo motu at any time, and, on application
of any person aggrieved, within a period of six months
from the date of any order, may call for and examine the
record of any case or proceedings of any officer
subordinate to it except those subject to appeal or
revision by the Tribunal or those in respect of which an
appeal has been made to the State Government under
B. S. SHESHAGIRI SETTY & ORS. v. STATE OF
1117
KARNATAKA&ORS. [V. GOPALAGOWDA, J.]
section 106, and the State Government after such
A
enquiry as it deems fit is satisfied that the order of the
officer is contrary to law and has resulted in a
miscarriage of justice, pass such orders thereon as the
State Government deems just:
Provided that no order shall be made to the prejudice
of any person under this section unless he has been
given a reasonable opportunity of being heard."
B
(emphasis laid by this Court) c
Since Section 108 is at the heart of the controversy in the instant
case, it is important to examine it in close detail. It confers
upon the State Government the power of suo motu revising
the order of the Tribunal. It is pertinent to note that no time limit 0
has been set for the same. The provision confers the power
upon the State Government in case the order of the Tribunal is
contrary to law and has resulted in miscarriage of justice.
13. Mr. S.N Bhat, the learned counsel appearing on
behalf of respondent no. 6, the auction purchaser vehemently E
contends that the limitation period prescribed for filing revision
petition by the Appellants under Section 108 of the Act is six
months. It is further contended that in the instant case the
petition was unduly delayed, and that the appellants had not
even filed an application for condonation of delay before the
F
Minister. The lecirned counsel further placed reliance upon the
judgment and order of the lea.med single judge of the Kamataka
~ligh Court in Writ Petition No. 17054 of 2004 c/w Writ Petition
No. 22453 of 2004, wherein the order of the Minister in the G
Revision Petition was set aside. The learned judge had
observed as under:
" ............ It is clear from the perusal of the order passed
by the first respondentthat no suo motu power has been
H
. 1118
SUPREME COURT REPORTS
[2015] 13 S.C.R.
A
exercised and order has been passed in the basis of
the revision filed by respondents 2 to 4 and the said
revision has not been filed within six months ...... "
The learned counsel has placed reliance upon the decision of
B this Court in V.N Shrikhande (Dr.) v. Anita Sena Fernandes1
to contend that a statutory authority has no jurisdiction to
entertain a petition beyond the period prescribed for presenting
the petition unless an application for condonation of delay is
filed. The learned counsel further contends that even in cases
C where no limitation period has been prescribed for exercising
the revision power, it must be exercised within a reasonable
period of time. The learned counsel places reliance upon the
·cases of State of Gujarat v. Patil Raghav Natha & Ors2 and
Santoshkumar Shivgonda Patil & Ors. v. Ba/asaheb
D Tukaram Shevale & Ors. 3
14. The learned counsel appearing on behalf of the
appellants, Mr. H. Chandra Shekhar, on the other hand,
contends that the High Court erred in setting aside the order
E of the Minister of Co-operation, Government of Karnataka in
the Revision Petition on the ground that it was barred by
limitation. The learned counsel places reliance upon the case
of Collector, Land Acquisition, Anantnag & Anr. v. Mst.
Katiji & Ors.4, wherein this Court has laid down the following
F principles to be applied while condoning delay :
G
"1. Ordinarily a litigant does not stand to benefit by
lodging an appeal late.
2. Refusing to condone delay can result in a meritorious
matter being thrown out at the very threshold and cause
of justice being defeated As against this whe,n delay is
• c2011) 1 sec 53
2
(1969) 2 sec 187
• (2009) 9 sec 352
H • (1987)2 sec 107
B. S. SHESHAGIRI SETTY & ORS. v. STATE OF
KARNATAKA& ORS. [V. GOPALAGOWDA, J.]
1119 .
condoned the highest that can happen is that a cause A
would be decided on merits after hearing the parties.
3. "Every day's delay must be explained" does not mean
that a pedantic approach should be made. Why not every
hour's delay, every second's delay? The doctrine must s
be applied in a rational common sense pragmatic
manner.
4. When substantial justice and technical considerations
are pitted against each other, cause of substantial justice C
deserves to be preferred for the other side cannot claim
to have vested right in injustice being done because of
a non-deliberate delay.
5. Then~ is no presumption that delay is occasioned
deliberately, or on account of culpable negligence, or D
on account of mala tides. A litigant does not stand to
benefit by resorting to delay. In fact he runs a serious
risk.
6. It must be grasped that judiciary is respected not on
E
account of its power to legalize injustice on technical
grounds but because it is capable of removing injustice
and is expected to do so."
The learned counsel appearing on behalf of the appellants
F
further contends that Section 108 of the KCS Act empowers
the state government to examine the legality of the order under
revision and also to prevent miscarriage of justice. The scope
of revisional jurisdiction depends on the language of the statute
providing revision.
G
15. We have heard the learned counsel for both the
parties. We are unable to agree with the contentions advanced
by the learned counsel appearing on behalf of respondent
no. 6. This case is a classic example to demonstrate the gross H
1120
SUPREME COURT REPORTS
[2015] 13 S.C.R.
A
miscarriage of justice that occurs when the principles of natural
justice are ignored for technical considerations. The appellants
in the present case are poor farmers, who have been made to
litigate for nearly three decades for their land, which was their
only source of income and livelihood, which right is guaranteed
B to them under Article 21 of the Constitution of India. The award
. of the Arbitrator dated 31.05.1975 was passed ex parte
against the appellants. The circular dated 02.03.1984 issued
by the Karnataka State Cooperative Land Development Bank
on the basis of the government order, stated that the farmers
C who had become defaulters as on 30.06.1982 to the Taluk
Co-operative Land Development Banks in the State, and
continued being defaulters upto 30.06.1983 could repay the
principal amount to such Banks, then in such cases, the State
D Government would bear the burden of the entire portion of the
interest on such loans on behalf of the farmers and reimburse
the same to such respective Banks. As is evident from the
letter 'Annexure P3', the appellants had repaid the entire
princip~I amount within the date specified in the circular, which
E fact has not been contested by the respondents. The Auction
sale of the property in question was conducted on 27.05.1981,
and the confirmation of the sale was ordered on 10.12.1985
without considering.the relevant fact of repayment of principal
amount due to the Bank within the time stipulated in the
F
notification issued by the Bank referred to supra. The
appellants had informed the Bank regarding the repayment of
loan on 29.06.1983. The appellate authority has not considered
the claim of the appellants on merit. The High Court of
Karnataka in Writ Petition No. 6642of1984 set aside the order
G of the KarnatakaAppellate Tribunal dated 27.12.1983 on the
ground that the appeal before the Tribunal was barred by
limitation. The Writ Appeals filed by the appellants were also
dismissed. The confirmation of sale of the property in question
was done on the basis of the order in the above mentioned
H Writ Petition. The same was challenged by the appellants
B. S. SHESHAGIRI SETTY & ORS. v. STATE OF
1121
KARNATAKA & ORS. [V. GOPALA GOWDA, J.]
before the Deputy Registrar of Co-operative Societies, who
A
dismissed it on the ground that the appellants have not proved
how the confirmation of sale is contrary to the provisions of the
KCS Act, despite the fact of the repayment of the loan amount
to the Bank being brought to his notice. The order of the
Minister of Co-operation, Government of Karnataka in the
B
Revision Petition setting aside the confirmation of sale was
set aside by the learned single judge of the Karnataka High
Court on the ground that it was barred by limitation. The same
was upheld by the Division Bench in the Writ Appeals.
16. The reliance placed by the learned counsel for the
respondents on the case of V.N Shrikhande referred to supra
c
is misplaced, as that case pertained to the Consumer
Protection Act, 1986 and the powers of the District Consumer
Forums therein.