1 1 1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION. CIVIL APPELLATE JURISDICTION. CIVIL APPELLATE JURISDICTION. LETTERS PATENT APPEAL NO.207 OF 2006 LETTERS PATENT APPEAL NO.207 OF 2006 LETTERS PATENT APPEAL NO.207 OF 2006 WITH WITH WITH CIVIL APPLICATION NO.278 OF 2006 CIVIL APPLICATION NO.278 OF 2006 CIVIL APPLICATION NO.278 OF 2006 IN IN IN WRIT PETITION NO.6913 OF 2004 WRIT PETITION NO.6913 OF 2004 WRIT PETITION NO.6913 OF 2004 Smt.P.D.Pillai : Appellant versus B.Y.Pagare & ors. : Respondents. Mr.Sanjay Jain and Mr.Rahul Mehta i/by KMC Legal Venture for the appellant. Mrs.S.S.Bhende, AGP, for Respondent Nos.1, 12 and 13. Mr.Prashant Naik for Respondent No.2. WITH WITH WITH LETTERS PATENT APPEAL NO.220 OF 2006 LETTERS PATENT APPEAL NO.220 OF 2006 LETTERS PATENT APPEAL NO.220 OF 2006 WITH WITH WITH CIVIL APPLICATION NO.291 OF 2006 CIVIL APPLICATION NO.291 OF 2006 CIVIL APPLICATION NO.291 OF 2006 IN IN IN WRIT PETITION NO.6912 OF 2004 WRIT PETITION NO.6912 OF 2004 WRIT PETITION NO.6912 OF 2004 Shri Savliram Gopal Tidame : Appellant versus B.Y.Pagare & ors. : Respondents. Mr.N.N.Bhadrashete for the appellant. Mr.Prashant Naik for Respondent No.2. WITH WITH WITH LETTERS PATENT APPEAL NO.221 OF 2006 LETTERS PATENT APPEAL NO.221 OF 2006 LETTERS PATENT APPEAL NO.221 OF 2006 WITH WITH WITH CIVIL APPLICATION NO.292 OF 2006 CIVIL APPLICATION NO.292 OF 2006 CIVIL APPLICATION NO.292 OF 2006 IN IN IN 2 2 2 WRIT PETITION NO.6906 OF 2004 WRIT PETITION NO.6906 OF 2004 WRIT PETITION NO.6906 OF 2004 Shri Chandrakant Sayajirao Shirsat : Appellant versus B.Y.Pagare & ors. : Respondents. Mr.P.N.Joshi for the appellant. Mr.Prashan Naik for Respondent No.2. CORAM : D.G.DESHPANDE CORAM : D.G.DESHPANDE CORAM : D.G.DESHPANDE SMT.R.S.DALVI, JJ. SMT.R.S.DALVI, JJ. SMT.R.S.DALVI, JJ. DATED : NOVEMBER 21, 2006. DATED : NOVEMBER 21, 2006. DATED : NOVEMBER 21, 2006. COMMON ORDER :- COMMON ORDER :- COMMON ORDER :- 1. Heard the different learned advocates for the appellants in these three LPAs. Four writ petitions came to be filed before the Single Judge of this Court. They were Writ Petition Nos.6906/04; 6911/04; 6912/04 and 613/04. Advocate Mr.P.N.Joshi had appeared for the petitioners in all these petitions. The Single Judge of this Court Justice Marlapalle dismissed all the four writ petitions by a common order dated 28th July 2006. 2. Against the aforesaid order of the Single Judge, four Letters Patent Appeals have been filed before this Court. We heard all the LPAs separately. But since the facts of Letters Patent Appeal No.219 of 2006 are materially 3 3 3 different, that is separated and separate order is passed. So far as other three LPAs i.e. LPA Nos.207/06; 220/06 and 221/06 are concerned, though the different advocates argued, We are passing this common order. 3. These three appellants/petitioners were the Managing Committee’s members of Respondent No.2 - H.A.L. (Nashik Division) Employees, Co-operative Credit Society Ltd. Ozhar, District Nashik. There were in all 13 members of the Managing Committee and one expert director. There were two groups in the Managing Committee, the first group was headed by Shri Bhausaheb N. Bankar and the other group was headed by Shri B.G.Khandelwal. The present appellants are of the Bankar’s group. A resolution was passed on 8/12/2000 for transferring the fixed deposits from the State Bank of India to some other bank including Nasik District Central Co-op. Bank, Nasik Merchants’ Co-op. Bank, Janlaxmi Co-op Bank, Business Co-op Bank and Jawahar Co-op. Urban Bank Ltd. etc.. This resolution was signed by seven members of the Managing Committee representing the Bankar group. But the six Managing Committee members representing the 4 4 4 Khandelwal group did not sign. Then between the period from 11/12/200 to 4/4/2001 an amount of Rs.2.20 crores came to be invested with the Jawahar Co-op. Urban Bank Ltd at Hyderabad by way of fixed deposit and the allegations against the petitioners are that they invested the amount at Hyderabad in a bank at Hyderabad i.e. beyond the territorial jurisdiction of Respondent No.2; they did not verify the financial position of Jawahar Co-op. Urban Bank Ltd, at Hyderabad before making such huge investment; further they did so without getting resolution dated 8/12/2000 confirmed in the next meeting held on 8/1/2001 and thereby caused huge loss to the Respondent No.2. This investment was in total disregard of the Circular of the Reserve Bank of India dated 20/7/2000 which was a moratorium order against Jawahar Co-op. Urban Bank Ltd. restraining it to accept any fixed deposit. Record also shows that on 13/11/2000 the RBI had already issued a show cause notice to the Jawahar Co-op. Urban Bank Ltd to explain as to why its banking licence should not be cancelled which ultimately came to be cancelled on 15/5/2002. Action was taken against the present petitioners under section 81 of the Co-operative Societies Act after an order 5 5 5 was passed by the District Deputy Registrar on 17/8/2002 directing an inquiry under section 88(1) of the Act and Respondent No.1 was appointed as the Inquiry Officer/Authorised Officer, who submitted his report on 3/2/2003 fixing the liability upon the present petitioners. 4. The petitioners had challenged this order of the Divisional Deputy Registrar before the District Joint Registrar in appeal and before the State Government in Revision. Both the appeal and the revision came to be dismissed and, therefore, the petitioners had filed three different petitions as stated above. The Single Judge, after hearing the petitioners, passed the common order and, therefore, these LPAs. 5. The learned advocate appearing for the respondents raised preliminary objection regarding maintainability of all these LPAs on the ground that original petitions of the petitioners were under Article 227 of the Constitution of India; they were disposed of by the Single Judge under Article 227 of the Constitution of India and the LPAs were not 6 6 6 maintainable. 6. The learned advocates appearing for the petitioners, however, contended the the original petitions were also under Article 226 of the Constitution of India and, therefore, the LPAs were maintainable. 7. However, on merits, the learned advocates for the petitioners made two submissions. Firstly, according to them, the procedure prescribed by Section 81 of the Act was not followed; no charge sheet was submitted; no opportunity of representing was given and, therefore, the principles of natural justice were not followed. They also contended that none of the petitioners knew when they passed the resolution dated 8/12/2000; that Jawahar Co-op. Urban Bank Ltd. was a bank situated at Hyderabad. 8. We do not find any merit in all these submissions. The Single Judge has observed that the petitioners were the members of the Managing Committee and they had with them a few years experience as such and they were not novice but 7 7 7 were familiar with the bye-laws of the society and the provisions of the Act and the Rules thereunder. Secondly even though the resolution was passed on 8/12/2000, the same was not the subject matter of conformity in the next meeting 8/1/2001 but before that from 11/12/2000 to 4/4/2001 an amount of Rs.2.20 crores came to be invested with Jawahar Co-op Urban Bank Ltd. When, therefore, the resolution passed on 8/12/2000 was followed and executed within a short span by investing the amount in Jawahar Co-op. Urban Bank Ltd at Hyderabad, the petitioners cannot be permitted to plead ignorance and contend that they were not knowing that Jawahar Co-op Urban Bank Ltd was situated at Hyderabad. 9. Second contention that no charge sheet was filed was also rightly rejected by the Single Judge. The authorised officer had issued a show cause notice intimating the charges against the petitioners about their illegal investment of Rs.2.20 crores in the Jawahar Co-op. Urban Bank Ltd. These petitioners had filed their defence statement. They were represented. They also filed appeal and revision and, therefore, as 8 8 8 rightly held by the Single Judge, there was full compliance to the requirements of law. For all these reasons, there is no merit in these three Letters Patent Appeal. Therefore, they are dismissed along with CAs. [SMT.R.S.DALVI, J] [D.G.DESHPANDE,J] [SMT.R.S.DALVI, J] [D.G.DESHPANDE,J] [SMT.R.S.DALVI, J] [D.G.DESHPANDE,J]