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Madhya Pradesh High Court · body

2008 DIGILAW 1142 (MP)

MANDAKINI RAVERKAR v. STATE OF M. P.

2008-09-12

VINEY MITTAL

body2008
Judgment VINEY MITTAL, J. ( 1. ) This order shall dispose of 13 writ petitions being W.P.No.4351/2008, W.P.No.4349/2008, W.P.No.5038/2008, W.P.No.5146/ 2008, W.P.No.5147/2008, W.P.No.5218/2008, W.P.No.5219/2008, W.P.No.5252/ 2008, W.P.No.5253/2008, W.P.No.5254/2008, W.P.No.5295/2008, W.P.No.5338/ 2008 and W.P.No.5339/2008, as the controversy in all these cases is identical and identical prayer has been made. The main order is being passed in WP No. 4351 of2006. ( 2. ) These petitions have been filed by some senior citizens raising a grievance against the rejection of their claim by Deputy Registrar and Liquidator of Maharashtra Brahman Sahkari Bank Limited-respondent no.3 (hereinafter referred to as Official Liquidator). Additionally, a communication dated March 5, 2008 issued by Deposit Insurance and Credit Guarantee Corporation-respondent no.6 (hereinafter referred to as Guarantee Corporation) has been challenged, whereby the petitioners have been communicated that the money deposited by the petitioners with the respondent-Bank could not be permitted to be refunded and the petitioner-depositors may have to wait for their turn for the repayment of unpaid amount. ( 3. ) Before noticing the facts leading to the filing of these petitions and dilating thereupon, it would be apt to recall the advice of V.R.Krishna Iyer, J. in (1979) 2 SCC 274 (Sant Ram Vs. Rajinder Lal), popularly remembered as Cobblers case. "Where doubts arise the Gandhian talisman becomes a tool of interpretation; whenever you are in doubt.......apply the following test. Recall the face of the poorest and the weakest man whom you may have seen, and ask yourself, if the step you contemplate is going to be of any use to him." Now the facts. ( 4. ) The petitioners in all the writ petitions have pleaded that they were the depositors with Maharashtra Brahman Sahkari Bank Ltd. (under liquidation) (hereinafter called respondent-Bank) and had deposited the money in their accounts, being the savings of their entire life. On account of some irregularities by the respondent-Bank, the Reserve Bank of India, vide its order dated September 22, 2004, cancelled the licence of the aforesaid bank w.e.f. October 6, 2004 and the bank was put under liquidation. After the cancellation of the licence of the respondent-bank, the Reserve Bank of India (RBI) and Official Liquidator as well as the Guarantee Corporation took charge of the affairs of the respondent-bank. After the cancellation of the licence of the respondent-bank, the Reserve Bank of India (RBI) and Official Liquidator as well as the Guarantee Corporation took charge of the affairs of the respondent-bank. It may be noticed that the Guarantee Corporation is a wholly owned subsidy of RBI and has been constituted to insure all deposits in commercial banks and subsidiaries. ( 5. ) The petitioners have claimed that the Official Liquidator, after taking over the management and control of the respondent-bank, started effecting recoveries, which were due and payable to the respondent-Bank by its debtors. Guarantee Corporation had also provided a huge sum for discharge of the liability of the respondent-Bank towards its depositors/creditors. On account the money made available by the Guarantee Corporation, the respondent-Bank, through Official Liquidator, disbursed an amount of Rs.1,00,000/- to each one of the depositors towards the repayment of the sums deposited by them in their respective accounts. However, the petitioners claim that although the Official Liquidator has made huge and substantial recoveries, but even thereafter, the remaining amount deposited by the petitioners in their accounts with the respondent-bank has not been released so far. On the other hand the Guarantee Corporation has prohibited the Official Liquidator and the respondent-Bank not to release any further amounts to the depositors, such as the petitioners, till the money advanced by the Guarantee Corporation was returned back. ( 6. ) A reply has been filed by respondent no.6- Guarantee Corporation. In the aforesaid reply, it has been maintained that the aforesaid Corporation was established with "twin objectives i.e. (i) giving insurance protection to small depositors in banks, and (ii) providing guarantee support to credit extended by banks and other approved financial institutions to certain categories of small borrowers, particularly those belonging to the weaker and neglected section of the society as well as to small-scale industrial units". The Guarantee Corporation has itself maintained that in order to achieve the aforesaid objectives of the Corporation, it had already advanced a huge sum to the Official Liquidator so as to meet with the obligations of the depositors and to release an amount of Rs.1,00,000/- to each one of the depositors. The Guarantee Corporation has itself maintained that in order to achieve the aforesaid objectives of the Corporation, it had already advanced a huge sum to the Official Liquidator so as to meet with the obligations of the depositors and to release an amount of Rs.1,00,000/- to each one of the depositors. According to it, however, the remaining amount had to be released to the depositors by the Official Liquidator, after the outstanding dues payable to respondent-Bank were collected by the official liquidator and after the discharge of the other obligations, on pro rata basis. The Guarantee Corporation also maintains that at the first instance, the respondent- bank was required to return back the money of the Guarantee Corporation, which had been advanced by it, for the immediate release of the amounts to the depositors, and it is only thereafter, that the rest of the money could be released to the depositors. ( 7. ) Shri Praveeen Pandit, Assistant Manager of the respondent-Bank, who is present in Court, has informed the Court that the Official Liquidator, who is in control and management of the respondent-Bank w.e.f. Year 2004, is in fact successful in effecting huge recoveries to the extent of Rs.40-50 lacs per month. Shri Pandit has also informed the Court that, as of date, the liquidity amount of the aforesaid Bank is Rs.13 Crores, lying deposited in its accounts, with further continuous recoveries being effected. ( 8. ) Shri Pradeep Kumar, Assistant General Manager of Guarantee Corporation, who is also present in Court, has stated similar facts before the Court, as have been pleaded by the Guarantee Corporation in its reply. Shri Kumar has maintained that the Guarantee Corporation has to look after the interest of all the depositors of the Banks through out the Country and therefore, it was only by way of interim measure that a huge amount was already released to respondent-bank for immediate release of Rs.1,00,000/-to each one of the depositors, but the remaining amounts have to be paid by the Official Liquidator from the money collected from debtors of the aforesaid respondent-Bank. Shri Kumar has also maintained that Official Liquidator, after collecting the debts due to the respondent-bank, is required to first return the money advanced by the Guarantee Corporation and it is only thereafter that the said money can be applied for release of the amounts to the depositors of the Bank. ( 9. Shri Kumar has also maintained that Official Liquidator, after collecting the debts due to the respondent-bank, is required to first return the money advanced by the Guarantee Corporation and it is only thereafter that the said money can be applied for release of the amounts to the depositors of the Bank. ( 9. ) I have heard the learned counsel for the parties and have duly considered the facts and circumstances of the case. ( 10. ) As noticed above, the petitioners before this Court are all senior citizens ( except two of them almost touching the age of 60 years). The petitioners had earlier approached this Court, through various writ petitions. The lead case being W.P.No.7489/2007. The aforesaid writ petitions were disposed of vide order dated Decemberl4, 2007. It was directed that the petitioners should first approach the Official Liquidator, who was directed to pass appropriate orders, in accordance with law. On the aforesaid liberty and directions issued by the Court, the petitioners filed detailed representations before the Official Liquidator. However, on account of a communication received by the Official Liquidator from the Guarantee Corporation/respondent no.6, not to release the money collected by the Official Liquidator through recoveries from the debtors of the respondent-Bank, the Official Liquidator expressed his inability to release the remaining amounts to the aforesaid depositor-petitioners. ( 11. ) It is in these circumstances, that the petitioners have approached this Court once again through the present petitions. Additionally a communication dated March 5, 2008 issued by the Guarantee Corporation to the depositors has also been challenged wherein it has been communicated that the "the creditors of the bank including depositors having balance in excess of Rs.One lakh may have to wait for their turn for repayment of their unpaid amount". As noticed above, the petitioners are not only small depositors, but are senior citizens. The Official Liquidator of the Bank has already collected huge amounts by way of recoveries. As of date, the amount lying with the Official Liquidator is to the extent of Rs.13 Crores approximately. As already noticed, Shri Pandit, Assistant Manager of the respondent-bank has informed the Court that Official Liquidator is engaged in a continuous process of recovery and is collecting approximately Rs.40-50 lacs per month. ( 12. As of date, the amount lying with the Official Liquidator is to the extent of Rs.13 Crores approximately. As already noticed, Shri Pandit, Assistant Manager of the respondent-bank has informed the Court that Official Liquidator is engaged in a continuous process of recovery and is collecting approximately Rs.40-50 lacs per month. ( 12. ) It may also be relevant to note that the total remaining deposits of all the petitioners, in all these petitions, are only for an amount of approximately Rs.50 lacs. In these circumstances, keeping in view that all the petitioners are almost in the evening of their life, it would not be appropriate to expect them to wait indefinitely for repayment of the amount which they had deposited with the respondent-bank, in good faith. The petitioners, concededly, had not entered in any commercial transaction with the respondent-bank. They had not invested money in any speculative business or stock market. The money, so deposited by them was, in fact, savings of their entire life, kept with the Bank for later use by them, as and when so required, for their rainy days. It is apparent that the petitioners almost feel deprived on account of denial of their money back to them, merely on technical/commercial pleas. During the course of arguments, it has been brought out by the learned counsel for the petitioners that all the petitioners are in evening of their life and are visited by normal ailments of old age, and even find it difficult to meet the aforesaid exigencies, having been deprived of their entire savings. ( 13. ) The twin objectives of the Guarantee Corporation have already been noticed above. The petitioners are no millionaires- ever expecting to multiply money by making commercial or speculative investments. As a matter of fact they fall in strict parameters of the objectives, for which the Guarantee Corporation came into existence. To expect them to stand in queue with other depositors of the respondent-bank and wait for their turn would sound good on the touchstone of equality, but in fact would treat even the petty depositors, which the petitioners are, as some speculators in search for their millions. It is not so. ( 14. ) It would be appropriate to be guided by the observations of Krishna Iyer, J. once again. [ (1978) 4 SCC 47 - Moti ram Vs. State of M.P.]. It is not so. ( 14. ) It would be appropriate to be guided by the observations of Krishna Iyer, J. once again. [ (1978) 4 SCC 47 - Moti ram Vs. State of M.P.]. "The law, in its majestic quality, forbids the rich as well as the poor to sleep under bridges, to beg in the streets, and to steal bread, lampooned Anatole France. The reality of this caricature of equal justice under the law, whereby the poor are priced out of their liberty in the justice market is the grievance of the petitioners." Further. "If mason and millionaire were treated alike, egregious inegality is an inevitability." If for nothing else, but for their background, their super-annuated status, their age and their financial placement, it would not be appropriate to make the petitioners wait for "their turn" as suggested by Guarantee Corporation. ( 15. ) In these circumstances, I feel that since liability towards the present petitioners is approximately Rs.50 lacs only, therefore the Official Liquidator should release the deposited amount of the depositor-petitioners at the first instance, and the remaining recovered amount can be applied towards the remaining outstanding liabilities of the respondent-bank, including the return of the advanced amount to the Guarantee Corporation. ( 16. ) Consequently, the present petitions are allowed and the Official Liquidator- respondent no.3 and Bank-respondent no.5, are hereby directed to release the entire deposited amount of the petitioners, along with interest accrued upto the date the bank was put under liquidation, within a period of one month from the date a certified copy of this order is presented. ( 17. ) However, the amounts already refunded to the aforesaid depositors and any other outstanding liability of such depositors towards the respondent-Bank, would be deductable from the said deposited amount. ( 18. ) It would be perfectly apt to conclude with more advice from Moti Ram (Supra). "The common experience of life lends credence to this case and none but those who live in ivory towers can refuse to look at the raw realities of life." ( 19. ) The present petitions are disposed of accordingly. C.C.as per rules. Petition disposed of.