WP/6734/2000 of Dr.Macha Laxminarasimha, Vs The Government of Andhra Pradesh, on 31 December 2008

ORDER:

The petitioner claims to have made deposits ofRs.25,000/- each in the name of himself and his familymembers, with M/s.Dhanalaxmi Chit Fund and Finance,3[rd] respondent herein, in the year 1997. The deposit infavour of the petitioner is said to have become matured on10.04.1999 and others on 08.03.2000. The petitionerstates that the 3[rd] respondent did not pay the depositseven after demand and that several other severaldepositors were also denied the payment. He claims tohave made a representation to the 2[nd] respondent to takeaction against the 3[rd] respondent under the provisions ofA.P. Protection of Depositors of Financial EstablishmentsAct, 1999 (for short ‘the Act’). His grievance is that noaction has been taken thereon. It is also alleged thatcomplaints were registered with the Station House Officer,Alair P.S., 5[th] respondent herein and similar allegationwas made.

The 5[th] respondent filed a counter affidavit, statingthat soon after receiving the complaints, F.I.R.No.69 of1999 was registered under Section 420 I.P.C. and further steps could not be taken, on account of non-availability ofthe persons managing the 3[rd] respondent.

Heard Sri D.Goverdhanachary, learned counsel forthe petitioner and the learned Government Pleader forHome.

The grievance of the petitioner is that the 2[nd]respondent did not take any steps under the Act againstthe 3[rd] respondent. Therefore, it becomes necessary toknow the scope and ambit of the Act. With a view toprotect the interests of the depositors in various financialestablishments, the A.P. State Legislature enacted the Actin the year 1999. Section 3 of the Act empowers theGovernment, either on a complaint received fromdepositors, or on its own accord, to order ad interimattachment of the money or other property of the financialestablishment. Once the property is attached, it is keptunder the control of “competent authority”. The DistrictCollectors are said to be conferred with such power. Under Sub-section (3) of Section 4 of the Act, the 2[nd]respondent has to approach the Special Court constitutedunder Section 6 of the Act within 15 days from the date ofattachment, with a prayer to make the ad interimattachment absolute.

The Courts of Principal District Judge in each Districtare designated as Special Courts under the Act. Section 7empowers the Special Court to issue notices to theaffected parties and to make the ad interim order ofattachment absolute or to modify the same. It is rathercurious that the Act is silent as to the manner in which theattached property is to be dealt with. Provision is onlymade for maintenance thereof. This legislature does notappear to have taken note of the fact that mereattachment of the property, without the facility of disposalthereof or adjudication of claims, would not serve thepurpose. That however is a different aspect.

Reverting to the facts of the case, the petitioner didnot even allege that he has ever approached the 1[st]respondent with a prayer to order ad interim attachment ofthe properties of the 3[rd] respondent. Unless such anapplication is made, there would not be an occasion fordirecting the 1[st] respondent to take any steps. Further, the1[st] respondent must be satisfied about the necessity toorder attachment. It has already been pointed out that the2[nd] respondent is not conferred with the power to directattachment of the property of the 3[rd] respondent.

Respondents 4 and 5 do not figure anywhere in thescheme of the Act. Therefore, the complaint submitted tothem would be hardly of any use in this regard.

For the foregoing reasons, the writ petition isdisposed of, leaving it open to the petitioner to approachthe 1[st] respondent with necessary application and thelatter in turn shall pass appropriate orders within four (4)weeks from the date of receipt of complaint. There shallbe no order as to costs.

_________

31.12.2008

JSU

THE HON'BLE MR JUSTICE L.NARASIMHA REDDY

JSU

Conclusion

WRIT PETITION NO : 6734 of 2000

Date: 31.12.2008