- 1 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 11TH DAY OF MARCH, 2025 BEFORE THE HON'BLE MR JUSTICE ASHOK S.KINAGI REGULAR SECOND APPEAL NO. 597 OF 2016 (RES) C/W REGULAR SECOND APPEAL NO. 598 OF 2016 IN RSA No. 597/2016 BETWEEN: MR. AJITH KUMAR S/O LATE. G. MURARAPPA, MADHU TRADERS, AGED ABOUT 62 YEARS, SANTHEPETE, HASSAN CITY, HASSAN-573 201, REPRESENTED BY GPA HOLDER, DHANPAL. …APPELLANT (BY SRI. SHRIKARA P.K., ADVOCATE) AND: GENERAL MANAGER, HASSAN DISTRICT WHOLESALE CO-OPERATIVE SOCIETIES LIMITED, HASSAN-573 201, JANATHA BAZAR BUILDING, DEVARAJ URS MARKET, REPRESENTED BY ITS MANAGER, MR. THIMMAIAH Digitally signed by SUNITHA K S Location: HIGH COURT OF KARNATAKA - 2 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 S/O RANGAIAH, AGED ABOUT 68 YEARS, HASSAN-573 201 …RESPONDENT (BY SRI. S.B. MUKKANNAPPA, ADVOCATE) THIS RSA IS FILED UNDER SEC.100 OF CPC., 1908 AGAINST THE JUDGMENT AND DECREE DATED 08.03.2016 PASSED IN RA.NO.66/2012 ON THE FILE OF THE ADDL. SENIOR CIVIL JUDGE, HASSAN, DISMISSING THE APPEAL AND CONFIRMING THE JUDGMENT AND DECREE DATED 18.07.2012 PASSED IN OS.NO.211/2004 ON THE FILE OF THE PRL. CIVIL JUDGE AND J.M.F.C., HASSAN. IN RSA NO. 598/2016 BETWEEN: MR. H.S. ACHAIAH KUMAR S/O. SURYANARAYANA SHETTY, AGED 60 YEARS, MURALI TRADERS, SANTHEPETE, HASSAN CITY, HASSAN 573 201 ...APPELLANT (BY SRI. SHRIKARA P.K., ADVOCATE) AND: GENERAL MANAGER, HASSAN DISTRICT WHOLESALE, CO-OPERATIVE SOCIETIES LIMITED, HASSAN 573 201, JANATHA BAZAR BUILDING, DEVARAJ URS MARKET, - 3 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 REP. BY ITS MANAGER, M.R. THIMMAIAH S/O. RANGAIAH, AGED ABOUT 68 YEARS, HASSAN 573 201. ...RESPONDENT (BY SRI. S.B. MUKKANNAPPA, ADVOCATE) THIS RSA IS FILED UNDER SEC.100 OF CPC., 1908 AGAINST THE JUDGMENT AND DECREE DATED 08.03.2016 PASSED IN RA.NO.67/2012 ON THE FILE OF THE ADDL. SENIOR CIVIL JUDGE, HASSAN, DISMISSING THE APPEAL AND CONFIRMING THE JUDGMENT AND DECREE DATED 18.07.2012 PASSED IN OS.NO.212/2004 ON THE FILE OF THE PRL. CIVIL JUDGE AND J.M.F.C., HASSAN. THESE APPEALS, COMING ON FOR HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE ASHOK S.KINAGI ORAL COMMON JUDGMENT These Regular Second Appeals are filed by the appellants challenging the common judgment and decree dated 08.03.2016 passed in R.A. No. 66/2012 and 67/2012 passed by the learned Additional Senior Civil Judge, Hassan and the common judgment dated 08.07.2012 passed in O.S.No.211/2004 and - 4 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 O.S.No.212/2004 by the Learned Principal Civil Judge and JMFC, Hassan. 2. For convenience, the parties are referred to, based on their ranking before the trial court. The Appellants were the defendants, the respondent was the common plaintiff in both the suits. 3. Brief facts, leading rise to the filing of these appeals are as follows: The plaintiff filed a suit against the defendant in O.S.No.211/2004 and in O.S.No.212/2004 for ejectment. It is the case of the plaintiff that, the plaintiff is the absolute owner of the suit schedule property. It is the case of the plaintiff that the suit schedule property originally belonged to the District Marketing Co-operative Society (DMCS), Hassan, as the DMCS borrowed a loan, and to resolve the litigation, the government appointed the Assistant Registrar of Co-operative Society as a recovery officer. As per the order of the Assistant Registrar of Co- operative Society dated 25.06.2003, the suit schedule - 5 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 shop premises are transferred in favour of the plaintiff's society. The defendants were the tenants since 31.12.2001 regarding the suit schedule shop, and the rent agreement was executed between the defendants and the official liquidator. The lease period was only 2 years on a monthly rent of Rs.1,250/- and Rs.1,000/- respectively. 4. The plaintiff brought to the notice of the defendants about the transfer of ownership and directed the defendants to pay the rents to the Plaintiff-Society. Despite the service of notice, the defendants did not pay the rent from 01.09.2003. The defendants are in due of rent of Rs.12,500 and Rs.10,000/- respectively, from 01.09.2003 to 31.05.2004. The plaintiff issued a legal notice dated 07.06.2004 calling upon the defendants to pay the arrears of rent and vacate, and hand over the possession of the suit-schedule shop premises to the plaintiffs. The defendants gave an untenable reply, and refused to vacate and hand over the suit schedule shop premises. Hence, a cause of action arises for the plaintiff - 6 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 for to file the suit for ejectment. Accordingly, prays to decree the suit. 5. The contentions of a written statement, filed in both suits, are substantially the same. It is contented that, the defendants entered into an agreement between the District Marketing Co-operative Society dated 31.12.2001 for a period of 2 years and rent agreed at Rs.1,250/- and Rs.1000/- per month, respectively. It is contended that the auction was conducted on 19.04.1990, and the defendants were the successful bidders. The defendants deposited 15% of the bid amount, and thereafter, the litigation went before the Hon'ble High Court of Karnataka, this Court directed a refund of 15% of the deposited amount with liberty to the sale officer to auction afresh. On 21.12.1999, the suit schedule properties were brought for public auction, and the defendants and one Chethan Narayan were successful bidders for a sum of Rs.11,86,000/- and deposited 15% of the amount. The recovery officer/liquidator of the District Marketing Co-operative - 7 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 Society challenged the auction proceedings, and sought for cancellation of the auction. The said auction proceedings were cancelled vide order dated 22.12.1999. The defendants, aggrieved by the order of cancellation of bid, preferred the appeal before the District Registrar of Co- operative Society, Hassan and the said appeal was dismissed vide order dated 22.12.2000. The defendants preferred writ petition. The writ petition was allowed on 26.05.2003 and directed the recovery officer to hold fresh proceedings, again the proceedings were initiated, the appeal before the recovery officer by the defendant and others were rejected vide order dated 26.06.2004. The defendants issued a legal notice dated 03.12.2003 to the District Market Co-operative Society, and the plaintiff in view of the claim of ownership made by plaintiff and the DMCS refused to receive the arrears of rent regarding the suit schedule premises. The defendants deposited the rent before the rent controller. The plaintiff - society had withdrawn the rent deposited before the Rent Controller. Hence, prays to dismiss the suit - 8 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 6. The trial Court, based on the pleadings of the parties, framed following issues. ISSUES IN O.S.211/2004 1. Whether the plaintiff proves his right and title to the suit premises? 2. Whether the plaintiff proves that the defendant occupies the suit premises as a tenant? 3. Whether the plaintiff proves valid termination of tenancy of the defendant? 4. Whether the plaintiff proves that the defendant is due to pay Rs.12,500/- as arrears of rent? 5. Whether the plaintiff is entitled for damages? If so at what rate? 6. Whether the plaintiff is entitled for relief claimed in suit? 7. What order or decree? ISSUES IN O.S.212/2004 1. Whether the plaintiff proves his right and title to the suit premises? 2. Whether the plaintiff proves that the defendant occupies the suit premises as a tenant? - 9 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 3. Whether the plaintiff proves valid termination of tenancy of the defendant? 4. Whether the plaintiff proves that the defendant is due to pay Rs.10,000/- as arrears of rent? 5. Whether the plaintiff is entitled for damages? If so at what rate? 6. Whether the plaintiff is entitled for relief claimed in suit? 7. What order or decree? 7. The plaintiff, to substantiate his case, authorized the signatory of the Society in O.S.No.211/2004, was examined as PW1, and marked ten documents as Ex.P1 to Ex.P10. On other hand, One M.Dhanpal was examined as DW1, and marked 70 documents Ex.D1 to Ex.D70. The authorized signatory of the Society in O.S.No.212/2004 was examined as PW1, and the defendant in O.S.No.212/2004 was examined as DW1 and marked 63 documents as Ex.D1 to Ex.D63. - 10 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 8. The trial court, after recording the evidence, hearing on both sides, and on assessment of oral and documentary evidence, answered issue Nos.1 to 3 and 6 in the affirmative, issue No.4 in the negative, issue No.5 partly in the affirmative in both suits and consequently, decreed the both suits with cost vide common judgment dated 18.07.2012. The defendants in O.S.No.211/2004 and O.S.No.212/2004, aggrieved by the impugned common judgment and decree passed in aforesaid suits, preferred an appeals in R.A.No.66/2012 and R.A.No.67/2012 on the file of learned Additional Senior Civil Judge, Hassan. The first appellate Court, after hearing arguments of the learned counsel for the parties, framed the following points for consideration 1. Whether the plaintiff proved that it is the landlord and defendants are its tenants? 2. Whether plaintiff proved the termination of tenancy in respect of suit schedule shop premises? 3. Whether the plaintiff is entitle for damages as sought for? - 11 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 4. Whether appeals under challenge calls for interference? 5. What order or decree? 9. The appellate Court, on re-assessment of oral and documentary evidence, answered point Nos. 1 to 3 in the affirmative and point No.4 in the negative, and point No.5 as per final order. The First appellate Court dismissed both the appeals, and confirmed the common judgment and decree passed in the aforesaid suits vide judgment dated 08.03.2016. 10. The defendants, aggrieved by the impugned common judgment passed in R.A.No.66/2012, and R.A.No. 67/2012 and the common judgment and decree passed in O.S.No.211/2004 and O.S.No.212/2004, preferred these Regular Second Appeals. 11. Heard the arguments of the learned counsel for the defendants, and the learned counsel for the plaintiff. - 12 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 12. Learned counsel for the defendants submits that the defendants have purchased the suit property under an auction. Hence, the plaintiff has no right to terminate the tenancy. Therefore, he submits that the impugned judgments passed by the Courts below are arbitrary and erroneous. Accordingly, on these grounds, he prays to allow the appeal. 13. Per contra, the learned counsel for the plaintiff submits that, originally the suit schedule property was owned and possessed by the District Marketing Co- operative Society, Hassan. The said Co-operative Society had borrowed a loan and to resolve the litigation, the government had appointed the Assistant Registrar of the Co-operative Society as a recovery officer, and the said schedule property was transferred in favour of the plaintiff. Hence, the plaintiff-society is the lawful owner of the suit schedule property. He also submits that the auction proceedings were held, and the defendants were the highest bidders, but the auction proceedings were set - 13 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 aside by this Court. He submits that the plaintiff has terminated the tenancy by issuing notice. Hence, after terminating the tenancy, the defendants have no right to continue in the possession of the suit schedule property regarding both the suits. Hence, both the Courts below were justified in passing the impugned judgments and accordingly, prays to dismiss the appeals. 14. This Court admitted the appeal to consider the following substantial question of law Whether the Courts below were justified in holding that the respondent - Society is the lawful owner of the suit property? 15. It is not disputed that, originally the said schedule property was owned and possessed by the District Marketing Co-operative society, Hassan. It is further stated, that the said Co-operative society borrowed a loan, and they could not repay the loan. The government had appointed the Assistant Registrar as a recovery officer and the recovery officer transferred the said schedule - 14 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 property in favour of the plaintiff society. The name of the plaintiff society is entered into the records. Further, the defendants have admitted that the District Marketing Co- operative Society had let out the suit schedule property for 2 years on a monthly rent of Rs.1,250/- and Rs.1,000/- respectively. The suit schedule property was put in auction by the District Co-operative Society, through its recovery officer. Though, the auction was conducted, and the defendants were the highest bidders, the plaintiff-society challenged the auction proceedings. The said auction proceedings were set aside by this Court, and directed the recovery officer to initiate a fresh auction proceedings. Though, the recovery officer initiated fresh auction proceedings, even in the said auction proceedings, the defendants were the highest bidders. The said auction proceedings were also set aside. As on the date of filing the suit, there was no auction proceedings confirmed in favour of the defendants. Further, the defendants deposited the rent before the Rent Controller. The plaintiff - society had withdrawn the rent deposited before the Rent - 15 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 Controller, claiming to be the owner of schedule property. The defendants did not object for withdrawing the rent amount by the plaintiff-society. The defendants have admitted the plaintiff's title over the suit schedule property. The trial Court was justified in recording its finding that, there exists a relationship as land lord and tenant between the plaintiff and defendants, and the plaintiff has terminated the tenancy of the defendants by issuing a notice, the trail Court has rightly passed the order directing the defendants to vacate, and hand over the possession of the suit schedule property. The First appellate Court, on reassessment of oral and documentary evidence, has confirmed the judgment and decree passed by the trial Court. There is no dispute about the lawful ownership over the suit schedule property, the defendant being a tenant in the suit schedule property. 16. In view of the above discussion, I answer substantial question of law in the affirmative. - 16 - NC: 2025:KHC:10377 RSA No. 597 of 2016 C/W RSA No. 598 of 2016 17. Accordingly, I proceed to pass the following order ORDER i. The Appeals are dismissed. ii. The judgments and decrees passed by the Courts below are hereby confirmed. iii. No order as to the costs. Sd/- (ASHOK S.KINAGI) JUDGE RCK List No.: 1 Sl No.: 10