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2010 DIGILAW 1280 (BOM)

Sundeep Polymers Pvt. Ltd. v. State of Maharashtra

2010-09-03

K.K.TATED, NARESH H.PATIL

body2010
K.K. TATED,J.:- Admit. 2. With the consent of respective counsel of the parties, this matter is taken up for final hearing at the admission stage. 3. By this Letters Patent Appeal, the appellants-Original petitioners are assailing order dated 13th February, 2009. passed by the learned Single Judge, dismissing the Writ Petition No. 2490 of 2008. 4. It is the contention of the appellants that in the proceedings initiated under section 101 of he Maharashtra Co-Operative Societies Act, 1960 Hereinafter referred to as "Said Act"), Recovery certificate has been issued against' them for recovery of Rs. 1,14.00.000/- (Rupees One Crore Fourteen Lakhs) along with interest. 5. It is the case of the appellants that respondent No.4 issued ex-parte recovery Certificate dated 19th December. 2007 under section 101 of the said Act, in Application No.1497 of 2007. They preferred an application on 26th December, 2007 for setting aside ex-parte Recovery Certificate issued under Section 101 of the said Act, under Order 9, Rule 13 of the Code of Civil Procedure. He submits that without giving any opportunity of hearing, respondent No.4 Recovery Officer confirmed an order dated 19th December, 2007 under section 101 of the said Act, on 22.02.2008. He submits that it is mandatory on the part of respondent No.4 to follow the procedure as prescribed under Chapter VIII - A of the Maharashtra Co-Operative Societies Rules. 1961. He submits that respondent No.4 without giving any reasoned order issued Recovery Certificate. He submits that as per Rule 86-F. it is duty of respondent No.4 to pass Judgment and order and thereafter to issue Certificate in Form V. In the present case. he has directly issued Recovery Certificate. 6. Mr. Nagargoje, learned Counsel appearing for the appellants-petitioners submits that the learned Single Judge failed to consider the fact that Recovery Officer without following Chapter VIII-A of the said Rules issued Recovery Certificate. He further submits that learned Single Judge dismissed the Writ Petition mainly on the ground that alternate remedy provided under Section 154 of the Maharashtra Co-Operative Societies Act, for preferring the revision to the registrar of the Co-operative Societies. He submits that the learned Single Judge ought to have considered that if without passing any Judgment and Order, Recovery Certificate is issued by the Competent Authority, then Courts have power under Article 226 and 227 of the Constitution of India to set aside such orders. 7. Mr. He submits that the learned Single Judge ought to have considered that if without passing any Judgment and Order, Recovery Certificate is issued by the Competent Authority, then Courts have power under Article 226 and 227 of the Constitution of India to set aside such orders. 7. Mr. Kulkarni, learned Counsel appearing on behalf of respondents submits that the learned Single Judge rightly held that the Writ Petition is not maintainable, when alternate remedy is available under section 154 of the Maharashtra Co-Operative Societies Act. He further submits that as on today the appellants failed to pay more an one Crore Rupees in the present case. He further submits that there are other proceedings initiated by them against the appellants for recovery of other loans. Therefore, this Court should not entertain the present Letters Patent Appeal, under Clause 15 of the Letters Patent Act. 8. We have heard both the sides at length. Admittedly, in the present case respondent No.4 Recovery Officer without passing any Judgment and Older issued recovery Certificate. Respondent No.4 failed to follow the procedure prescribed under Chapter VIIIA of the said Rules to grant Certificate of Recovery under Section, 101 of the aid Act. Under Rule 86-A the; procedure is prescribed for filing the application for granting recovery Certificate. Rule 86-B provides scrutiny of application and notice to the parties. Rule 86-C provides procedure for appearance of parties and consequences of non-appearance. whereas Rule 86-D provides production and inspection of documents. If other side asked inspection of documents, in that case, Recovery Officer should allow the same. Rule 86-E prescribed procedure of hearing of the application. It provides that Registrar should decide the application within three months from the first date of hearing. He should allow the parties to argue orally and thereafter fix the matter for orders. Rule 86-F provides that the authority should pass reasoned Judgment and order and thereafter issue Recovery Certificate in Form V. 9. We perused the order passed by the learned Single Judge. The learned Single Judge rejected the Writ Petition mainly on the ground that alternate remedy is available under section 154 of the said Act. We are of the opinion that the learned Single Judge has not considered the procedure prescribed under Rule 86-A to 86-F of the said Rules. It is crystal clear from the Rules 86-A to 86-F that the Authorities pertains quasi judicial work. We are of the opinion that the learned Single Judge has not considered the procedure prescribed under Rule 86-A to 86-F of the said Rules. It is crystal clear from the Rules 86-A to 86-F that the Authorities pertains quasi judicial work. The Authorities have to follow the rules of natural justice. In the present case, the Authority without passing any Judgment issued Recovery Certificate under section 101 of the Said Act. These facts are not considered by the learned Single Judge. 10. It is mandatory for the Authorities to follow the Rules provided in Chapter VIIIA of the Maharashtra Co-Operative Societies Rules 1961 while issuing Recovery Certificates. It is amply clear that in this case the Recovery Certificate has been issued without following due procedure and also without proper service of notice on the appellants and the Rules of natural justice are violated. Hence the Recovery Certificate issued must be held to be invalid and bad in law and needs to be struck down. This has resulted into unnecessary waste of time and money by the appellants as well as the bank. 11. The learned Single Judge of this Court (in Group of Writ Petition Nos 1717 of 2009, Ravindra S/o. Waman Ingle and another V s. Sahakar Mitra Shri Chandrakant Hari Badhe Sir Urban Co-Operative Credit Society Ltd. Varangaon and others) held that "the Certificate issued without following amended Rules 86-A to 86-F of the said Rules is unsustainable. It is further held that enquiry is required to be conducted in accordance with the Rules". 12. Similar view is taken in the matter of Khushal Narayanrao Mundhe Vs. State of Maharashtra and others, reported in 2007(4) Bom. C.R. 350 :[2008 (1) ALL MR III], and unreported Judgment in the matter of Vithal Laxman Fatangade Vs. The State of Maharashtra and others in Writ Petition No. 2070 of 2010 dated 27th July, 2010 (Coram: V. R. KINGAONKAR, J.). 13. Considering foregoing reasons and basic infirmities found in the Certificate issued against the appellants, the appeal is allowed. The impugned Judgment passed by the learned Single Judge, dated 13th February, 2009 and the Recovery Certificate issued by respondent No.3 dated 19th December, 2007, are set aside. 14. The Deputy Registrar Cooperative Societies Aurangabad. Ta.Aurangabad shall conduct denovo enquiry as per Rules and after following due procedure pass the appropriate order. The impugned Judgment passed by the learned Single Judge, dated 13th February, 2009 and the Recovery Certificate issued by respondent No.3 dated 19th December, 2007, are set aside. 14. The Deputy Registrar Cooperative Societies Aurangabad. Ta.Aurangabad shall conduct denovo enquiry as per Rules and after following due procedure pass the appropriate order. The parties to Appeal shall appear before the Deputy Registrar on 28th September. 2010 at 11.00 a.m. The parties waive notice for appearance before Deputy Registrar. 15. The appellants may file their Written Statement/Reply on the date of appearance or at the most within one week thereafter. Thereafter, the proceeding-enquiry shall be completed expeditiously as contemplated under relevant provisions and Rules as far as possible within a period of three months from the receipt of this order. The Letters Patent Appeal is allowed in the above terms. Appeal allowed.