1 lpa-60-09.doc mgn IN THE HIGH COURT OF JUDICATURE AT BOMBAY APPELLATE CIVIL JURISDICTION LETTERS PATENT APPEAL NO.60 OF 2009 IN WRIT PETITION NO.4058 OF 1992 Dr. Vinayak Chintamani Agashe .. Appellant Vs. State of Maharashtra and ors. .. Respondents Mr. Anil V. Anturkar i/by Mr. S. B. Deshmukh for appellant. Mr. C.R. Sonawane, AGP for respondent nos.1 and 2. Mr. Atul Damle for respondent no.3. CORAM: B. H. MARLAPALLE & U. D. SALVI, JJ. DATE : DECEMBER 03, 2010 P.C. 1. Heard Mr. Anturkar, the learned Counsel for the appellant and Mr. Damle, the learned Counsel for the respondent 2 lpa-60-09.doc no.3- bank. 2. This appeal is directed against the judgment dated 19th December, 2008 of a Single Bench in Writ Petition No.4058 of 1992 thereby dismissing the petition. 3. Respondent No.4 was a borrower of the bank and the appellant and respondent No.5 were the guarantors for the same. However, the respondent No.4 defaulted in the repayment of the said loan and, therefore, the Deputy Registrar, Co- operative Societies, Pune, in Recovery Application No.5 of 1988 issued a certificate under Section 101 of the Maharashtra Co- operative Societies Act, 1960 (for short the Act) on 14/5/1992, against borrower as well as the guarantors. Though this recovery certificate passed by the Deputy Registrar, Co-operative Societies, could have been challenged in a revision application under Section 154(2A) of the Act before the Divisional Joint Registrar, Co-operative Societies, the appellant approached this court directly in Writ Petition No. 4058 of 1992 and 10 years later, it came to be dismissed by the Single Bench. 4. The Respondent No.4 was sanctioned an amount of 3 lpa-60-09.doc Rs.5,00,000/- with interest at 18% per annum in the year 1983 by the respondent no.3-bank and while releasing the said amount, various documents came to be executed, namely, demand promissory note, cash credit agreement, letter of continuity, letter of hypothecation and the guarantee bond executed by the petitioner and respondent no.5. As the borrower defaulted in repayment of the said loan, a notice dated 26/12/1987 was issued by the bank to the borrower with a copy to the guarantors demanding the recovery of an amount of Rs.5,61,107/-, before 2/1/1988 but the borrower failed to comply with the demand notice and, therefore, recovery proceedings under Section 101 of the Act were initiated against the borrower as well as the guarantors. The appellant had appeared before the Deputy Registrar, sought inspection of various documents from the bank and an inspection report was submitted by him on 17/12/1991 before the Deputy Registrar and thereafter the recovery certificate came to be issued. The learned counsel for the appellant, by referring to the scheme of Section 101 of the Act, Rule 86 F of the Maharashtra Co-operative Societies Rules and Form V thereunder, submitted that the recovery can be executed only against the borrower. He also pointed out that when the application for recovery was submitted before the Deputy 4 lpa-60-09.doc Registrar by the respondent-bank, it was accompanied by a statement of arrears and the Deputy Registrar was required to examine only the correctness of the outstanding amount. The order passed under Section 101 of the Act is an administrative order passed by the Deputy Registrar and it is only an indication of the amount of arrears payable by the borrower and hence such a certificate cannot be enforced against the guarantor. By referring to Section 101(3) read with Section 4 of the Indian Evidence Act, it was submitted that the certificate so issued is not a conclusive proof of the dues and it is required to be adjudicated upon by the Co-operative Court to decide the amount due and only after such a decision, it could be enforced against the guarantors to repay the loan amount. 5. Some of these arguments were also advanced before the Single Bench and it has been held in the impugned order that the creditor bank can always recover the outstanding amount, both from the principal borrower as well as the guarantors and this view has been supported by the judgment in the case of Kushal Mahabal Shetty vs. The Deputy Registrar, Co-operative Societies, Thane (W.P. No. 1091 of 2002 decided on 4/3/2002). The scheme of Section 101 states that notwithstanding anything 5 lpa-60-09.doc contained in Sections 91, 93 and 98 of the Act, on an application made by an Urban Co-operative Society for the recovery of arrears of its dues and on the society concerned furnishing a statement of accounts in respect of the arrears, the Registrar may, after making the inquiry in such manner as may be prescribed, grant a certificate for the recovery of the amount stated therein to be due as arrears. A certificate issued by the Registrar under subsection (1) of Section 101 shall be final and a conclusive proof of the arrears stated to be due therein and the same shall be recoverable according to the law for the time being in force for the recovery of land revenue. Thus the certificate issued by the Deputy Registrar is a conclusive proof of the arrears due to be recovered from the borrower or from his guarantor (on failure of the borrower). The arrears payable to the Urban Co-operative Bank by a defaulter borrower can be recovered from his guarantor or guarantors. The learned Single Judge also held that the appellant could not have been relegated to the alternative remedy while deciding the writ petition finally and after a lapse of more than sixteen years. 6. We are satisfied that the reasoning set out in the impugned order does not call for any reconsiderations at our 6 lpa-60-09.doc hands and this appeal is devoid of merits and, therefore, must fail at the threshold. 7. Hence, the appeal is dismissed. (U. D. SALVI, J.) (B. H. MARLAPALLE, J.)