Council bosses are locked in a legal wrangle after bailiffs marched into the council house and seized more than £2,500-worth of computer and IT kit.
Seven computer monitors, four desktop computers, a laptop and a printer, with a combined replacement value of £2,652, were impounded last month.
The row turns on claims Birmingham City Council owed a third party, thought to have been a private landlord, around £5,000.
It took council lawyers two-and-a-half hours to obtain a court order stopping the seizure and forcing the bailiffs to leave the historic Council House.
Now the authority is taking legal steps to recover the equipment seized by bailiffs last month, saying it does not owe any debt.
The organisation also insisted it knew nothing of the ongoing issue as all court orders and payment demands were wrongly sent to a nearby building not linked to the council.
Details of exactly what was seized emerged in a statement given to councillors at their monthly meeting by Labour council leader Ian Ward.
He said the two bailiffs entered the building with a Writ of Control – a legal debt notice – without warning.
“The council received no notice of the Writ or the action in the County Court to which it related prior to the attendance of these enforcement agents,” Coun Ward said.
He explained it was only after the seizure that the council discovered the claim had been decided against the council at Northampton County Court and the Writ issued by Manchester District Registry.
“It appears the courts sent all notices of the claim to 1 Victoria Square – which is the building opposite the Council House and is not owned nor controlled by the council,” he added.
“Therefore, the council had no notice of the claim and was denied the opportunity to defend itself.
“The claim is wholly denied by the council.”
Coun Ward added that a “private individual” was seeking £5,000 from the council in a claim which appeared to be “speculative”.
The Birmingham Mail had been earlier told by council sources that the debt related to a private tenant who had not paid their rent and was receiving housing benefit – which is paid by the council on behalf of the Government.
Legal action has been launched for the return of the equipment and for the debt to be cancelled.
The council said the equipment was fully password-protected and data encrypted so no information could be accessed.
The bailiffs are also required by law to take care of the equipment while the legal challenge is ongoing, it said.