admin
The Telangana High Court has directed district cooperative society authorities not to directly attach properties belonging to relatives or legal heirs of people accused of misappropriating funds in primary agricultural cooperative societies (PACS). While quashing attachment orders, Justice T Madhavi Devi emphasised that due process must be followed before attaching a third party’s property. The ruling came on September 11 in a common order on three writ petitions.
In the first petition, the petitioner’s husband who served as the chief executive officer (CEO) of the PACS, Yamapur, was accused of misappropriation of funds. To recover a surcharge amount of Rs 74,60,333, the properties of the petitioner were attached under section 73 of the Telangana Cooperative Societies Act (TCS Act). The petitioner claimed the attached properties were her self-acquired properties, including those purchased with her “Sri Dhanam” and profits from her liquor business. She argued that her husband had no right or share in them.
The court found that the officials had directly attached the petitioner’s properties without issuing a showcause notice or conducting a proper inquiry into the nature of her ownership.
“Before attachment, the official respondents ought to have at least issued a showcause notice to the petitioner to inquire as to the nature of the property held by her and thereafter, after considering the same, ought to have taken a decision,” the judge remarked, pointing to a blatant disregard for due process. The judge also noted that the properties were attached “by assuming that the petitioner’s properties are also the properties of the respondent No.5”.
Officials allowed to proceed against both parties
The court subsequently set aside the attachment order, granting liberty to the officials to proceed against both the husband and the petitioner, but only after providing them with a “reasonable opportunity of hearing” in accordance with the law.
In the second petition, the father of a former employee of a cooperative society challenged the attachment of his properties to recover a misappropriated amount of Rs 10,14,159. Since his son, the alleged wrongdoer, had no properties in his name, the father’s properties were attached.
The court noted that the petitioner had an alternative remedy available under Rule 52 (21)(a) & 21(c) of the Telangana Cooperative Societies Rules, which allows for filing a suit to establish one’s right over the disputed property within six months of the attachment order. Justice T Madhavi Devi permitted the petitioner to pursue the alternative remedy within one month from the date of the order, acknowledging that he had been seeking a legal remedy through the court.
Story continues below this ad
In the third petition, properties belonging to the family of another former CEO were attached to recover Rs 1,11,70,093. The attachment notice was issued on September 30, 2023, after it was found that the former CEO had no properties in his name.
The court discovered a procedural irregularity: the attachment proceedings were passed on September 2, 2023, which was before the notice was issued. The court ruled that the “impugned orders are not sustainable”.
The court set aside the attachment orders and granted the officials the “liberty to issue notices to the petitioners and thereafter proceed in accordance with law”.
