SMT. PARVATHI W/O LATE KRISHNA HEGDE vs M/S VYAVASAYA SEVA SAHAKARI SANGHA LTD

Court
Karnataka High Court

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WP No. 107758 of 2026


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IN THE HIGH COURT OF KARNATAKA AT DHARWAD


TH
DATED THIS THE 14 DAY OF OCTOBER, 2026

BEFORE

THE HON'BLE MR. JUSTICE M.G.S. KAMAL

WRIT PETITION NO. 107758 OF 2026

BETWEEN:

SMT. PARVATHI W/O LATE KRISHNA HEGDE
AGE. 73 YEARS, OCC. HOUSEHOLD WORK,
R/O BELGUNDI UMMACHAGI POST,
YELLAPURA TALUK, UTTARA KANNADA DISTRICT 581347.


…PETITIONER

(BY SRI. PRAKASH, ADVOCATE APPEARED THROUGH VC FOR
SRI. VINAYAKA B. HEGDE, ADVOCATE)

AND:



1. M/S VYAVASAYA SEVA SAHAKARI SANGHA LTD.,
UMMACHAGI, YELLAPURA TALUK,
UTTARA KANNADA DISTRICT 581347,
R/BY ITS CHIEF EXECUTIVE OFFICER/CHIEF
ADMINISTRATOR

2. THE ASSISTANT REGISTRAR OF
CO-OPERATIVE SOCIETIES, SIRSI SUB-DIVISION,
SIRSI, UTTARA KANNADA DISTRICT 581401.





Digitally
signed by
SAROJA
HANGARAKI
Location:
high court of
karnataka,
dharwad
bench
…RESPONDENTS
(BY SRI. S.R. HEGDE, ADVOCATE FOR R1;
SRI. ASHOK T. KATTIMANI, ADVOCATE FOR R2)

THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227
OF THE CONSTITUTION OF INDIA, PRAYING TO ISSUE A WRIT OF
CERTIORARI OR ANY OTHER APPROPRIATE WRIT, ORDER OR
DIRECTION, QUASHING THE ORDER DATED 30.06.2026 PASSED BY
RESPONDENT NO.3-KARNATAKA APPELLATE TRIBUNAL IN CO-
OPERATIVE REVISION PETITION NO.71/2022 (CH-5), PRODUCED AT
ANNEXURE-A AND ETC.

THIS WP COMING ON FOR PRELIMINARY HEARING, THIS DAY,
ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE M.G.S. KAMAL

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WP No. 107758 of 2026


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ORAL ORDER


1. The petitioner, who is stated to be a borrower of a loan
from respondent No. 1–Co-operative Society and against
whom a dispute was initiated under Section 70 of the
Karnataka Co-operative Societies Act,1959 (for short the
‘Act’) in Dispute No. Sa.Ni.-21/BA/ABN/73/2006-07, is
before this Court seeking the following reliefs:
“a) issue a Writ of Certiorari or any other
appropriate writ, order or direction, quashing
the order dated 30.06.2026 passed by
Respondent No.3-Karnataka Appellate Tribunal
in Co-operative Revision Petition No.71/2022
(CH-5), produced at ANNEXURE-A;

b) issue a Writ of Certiorari or any other
appropriate writ, order or direction, quashing
the order dated 29.10.2022 passed by
Respondent No.2 in A.B.N. Case No.73/2006
arising out of Dispute No.Sa.Ni.-
21/BA/ABN/73/2006-07, produced at
ANNEXURE-B;

c) consequently, hold and declare that the
loan/charge documents relied upon by
Respondent No.1, being unregistered, are
inadmissible in evidence in Dispute No. Sa.Ni.-
nd
21/BA/ABN/73/2006-07 pending before the 2
Respondent.

d) in the alternative, remand the matter to the
rd nd
3 Respondent-Tribunal / 2 Respondent for
fresh consideration of the Petitioner's
application dated 09.11.2021 in accordance
with law and in light of the observations of this
Hon'ble Court;


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e) pass such other writ, order or direction as this
Hon'ble Court may deem fit and proper in the
facts and circumstances of the case, in the
interest of justice and equity.”

2. Heard learned counsel for the petitioner, who appeared
through video conferencing, learned counsel for
respondent No.1 and learned AGA for respondent No.2.

3. Learned counsel for the petitioner submits that
respondent No. 1–Co-operative Society sought to produce
the following documents:
i. Authorization letter dated 09.04.2000;
ii. Loan application dated 27.06.2004;
iii. Promissory note dated 28.06.2004;
iv. Loan agreement dated 28.06.2004; and
v. Declarations dated 27.03.2000 and 05.07.2004,
purportedly executed by the petitioner, creating a charge
over the immovable property as security for the loan
borrowed by her.

4. He further submits that the petitioner raised objections at
the time of marking the said documents on the ground
that they require payment of stamp duty and registration.
However, the said objections were rejected by
respondent No. 2–Assistant Registrar of Co-operative

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Societies, by relying upon Section 38 of the Karnataka
Co-operative Societies Act. The revision petition filed
against the said order before the Karnataka Appellate
Tribunal under Section 107 of the Act, in Co-operative
Revision Petition No. 71/2022, was also rejected,
accepting the reasons assigned by respondent No. 2.

5. Learned counsel for the petitioner submits that
respondent No.2 and the Karnataka Appellate Tribunal
have misconstrued Sections 17 and 49 of the Registration
Act, 1908, and incorrectly applied Section 38 of the
Karnataka Co-operative Societies Act, 1959. He contends
that the documents, on their face, purport to create a
charge over the immovable property and, therefore,
require compulsory registration. He further submits that
the documents are liable to be duly stamped in
accordance with the applicable provisions of law.
Accordingly, he seeks appropriate relief in the writ
petition.

6. Per contra, learned counsel appearing for respondent No.
1–Co-operative Society submits that none of the

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documents is intended to create any right, title or interest
in the immovable property. The documents neither create
a mortgage nor create a charge so as to require
compulsory registration. However, he fairly submits that
some of the documents may require payment of stamp
duty and that the same may be considered in accordance
with law.

7. Learned Additional Government Advocate, supplementing
the submissions made by learned counsel for respondent
No. 1, submits that appropriate orders may be passed in
respect of the documents that require payment of stamp
duty.

8. Heard and perused the records.

9. The authorization letter dated 09.04.2000 purportedly
authorizes respondent No. 1–Co-operative Society to
initiate recovery proceedings under Section 70 of the Act.
The said document does not appear to create any right,
title or interest in the immovable property.

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10. The loan application, promissory note and loan
agreement dated 28.06.2004 contain promises and
undertakings by the alleged borrower for repayment of
the loan amount. The said documents do not indicate any
clause creating a right, title or interest in respect of any
immovable property. The declarations dated 27.03.2000
and 05.07.2004, however, indicate the creation of a
charge over certain property.

11. In that view of the matter, there is substance in the
submission made by learned counsel for respondent No.
1–Co-operative Society that the said documents do not
require compulsory registration. However, the copies of
the documents produced along with the memo filed by
the petitioner indicate that the documents have not been
sufficiently and duly stamped.

12. Respondent No. 2–Assistant Registrar of Co-
operative Societies and the Karnataka Appellate Tribunal
have relied upon Section 38 of the Karnataka Co-
operative Societies Act, 1959, which has been extracted
in the impugned order and reads as under:

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“38. Exemption from compulsory
registration of instruments.— Nothing in
clauses (b) and (c) of sub-section (1) of section
17 of the Indian Registration Act, 1908 (Central
Act XVI of 1908), shall apply to,—
(a) any instrument relating to shares in a co-
operative society notwithstanding that the
assets of the society consist in whole or in part
of immovable property;
(b) any debentures issued by any such society
and not creating, declaring, assigning, limiting
or extinguishing any right, title or interest to or
in immovable property except in so far as it
entitles the holder to the security afforded by a
registered instrument whereby the society has
mortgaged, conveyed or otherwise transferred
the whole or part of its immovable property or
any interest therein to trustees upon trust for
the benefit of the holders of such debentures;
or
(c) any endorsement upon or transfer of any
other debenture issued by any such society.
Provided that the exemption from compulsory
registration of instrument shall not apply to
instruments which are intended to transfer or in
effect transfer the right, title or interest in
immovable property executed by or in favour of
House Building Co-operative Societies
registered under this Act.”

12. A perusal of the said provision, as rightly contended
by learned counsel for the petitioner indicates that none
of the documents sought to be produced by respondent
No. 1–Co-operative Society is covered by the list of
documents specified under Section 38 of the Karnataka

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Co-operative Societies Act. Therefore, if respondent No. 2
and the Karnataka Appellate Tribunal have relied upon
the said provision to exempt the documents from
payment of stamp duty, such orders cannot be sustained.

13. Accordingly, the impugned orders passed by
respondent No. 2 and the Karnataka Appellate Tribunal,
to the aforesaid limited extent, are hereby quashed .

14. Respondent No. 2 shall examine the documents
and, if the stamp duty is required to be paid thereon,
proceed to pass appropriate orders in accordance with the
provisions of the applicable stamp law.

15. Since the dispute has been pending for nearly 20
years, respondent No. 2 shall endeavour to dispose of the
matter as expeditiously as possible within a period of six
months from the date of receipt of a certified copy of this
order.
Sd/-
(M.G.S. KAMAL)
JUDGE



VB/CT:VP/LIST NO.: 1 SL NO.: 12