-1- IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE SIDE JURISDICTION Writ Petition No.5329 of 2005 Smt Anita Anil Ovalekar and anr...petitioners vs Rupee Coop Bank Ltd and ors.. respondents Mr H V Kode for petitioners Mr.C.P.Deogirikar for respondent no.l Mr A H Palekar AGP for respondent nos.2 and 3 with Writ Petition No.5669 of 2005 Smt Dhanamma Annapa Mahajan & ors..petitioners vs Dy Registrar Coop Societies Miraj and ors .. respondents Mr Ashutosh M Kulkarni for petitioners Mr. A H Palekar AGP for respondent nos.l and 8 Mr. N V Walawalkar with Mr G H Keluskar for respondent no. 2 with Writ Petition No.5670 of 2005 Smt Dhanamma Annappa Mahajan & ors.. petitioners vs Deputy Secretary Coop Societies and ors.. respondents -2- Mr.Ashutosh M Kulkarni for petitioners Mr A.H.Palekar AGP for State Mr. Mr Walawalkar with G.H.Keluskar for respondent no. 2 with Writ Petition No.l0772 of 2004 Himalaya Hosiery Prof Narasayya L Shrikonda.. petitioner vs l. The State of Ma and ors ..respondents Mr. S.S.Shah for petitioner Mr. A.H.Palekar AGP for State Mr. P S Dani for respondent no.4 CORAM: S.U.KAMDAR J. CORAM: S.U.KAMDAR J. CORAM: S.U.KAMDAR J. Dated:22nd December 2005 Judgement: ( Per S U Kamdar J.) Judgement: ( Per S U Kamdar J.) Judgement: ( Per S U Kamdar J.) l. All these writ petitions are raising a common question of law as to the retrospective operation of section l54(2A) of the Maharashtra Cooperative Societies Act, l960, hereinafter referred to as the said Act, hence same are disposed of by this common judgment. Some of the brief facts in respect of each of the petition in so far as it is material for determination of the question of law raised -3- before me are as under. 2. In Writ Petition No. 5729 of 2005 the petitioner is carrying on business in the name and style of M/s Anita Colour Industries and he availed a loan facility from the Thane Peoples Cooperative Bank Ltd. On 27.l2.l984 the Thane Peoples Cooperative Bank Ltd issued a notice of demand for recovery of Rs.l.75 lacs because the petitioner defaulted in repayment of the loan. The said Thane Peoples Coop Bank Ltd has been subsequently taken over by Rupee Cooperative Bank Ltd. On 24.4.l996 the petitioner demanded various details of documents and accounts from the said respondent no.l bank. On 28.6.l996 the respondent no.l bank issued a notice for recovery of the aforesaid amount and the petitioner no.l replied the said notice by their letter dated 5.7.l996. One of the contentions raised was that the claim is already barred by the law of limitation. Subsequent to the aforesaid the respondent no.l filed an application before the Dy Registrar of Coop Societies for issuance of a recovery certificate under section l0l of the said Act. In reply thereto the petitioner by their letter dated 25.9.l998 denied their liability to pay. On 25.2.l999 a recovery certificate has been issued . The said order was -4- challenged by filing revision application on 25.2.l999. On 23.8.2000 by the amending Act being Maharashtra Act no.4l of 2000 sub-section (2A) to the provisions of section l54 of the said Act was inserted. On 29.3.2004 both parties filed written submissions and pursuant thereto on l7.l.2005 an order came to be passed by the appellate authority rejecting the revision application on the ground that there is no compliance with the newly added provisions of section l54(2A) of the said Act which inter alia provides for deposit of 50% of the amount as awarded by the recovery certificate by the lower authority. It is this order which is challenged in the present petition. 3. In Writ Petition No.5669 of 2005 the 3rd respondent was a partnership firm to which one deceased Anna Dhondappa Mahajan was a partner alongwith other respondents. The 3rd respondent obtained loan from the 2nd respondent bank i.e.Sangli Cooperative Bank Ltd. In view of the fact that the 3rd respondent was in arrears of loan amount the 2nd respondent bank initiated proceedings under section l0l of the said Act for recovery of the loan amount lent and advanced by the said bank. Pursuant to the said application recovery notices were issued and ultimately on -5- 28.4.l999 a recovery certificate was issued by the Dy Registrar of Coop Societies exercising his power conferred under section l0l of the said Act. The petitioners are the legal heirs of the deceased Anna Mahajan. Against the said recovery certificate respondent nos. 4 and 5 preferred revision application nos. 270 and 27l of 2000 and by order dated 6.9.2000 said recovery certificate was set aside and the matter was remanded back to the Dy Registrar of Coop Societies for fresh hearing. The matter was heard and certain preliminary orders were passed which were the subject matter of challenge in the revision application no.33 of 200l. The said revision application was also allowed and the matter was remitted once again back to the Dy Registrar. Thereafter the matter was heard afresh on 22.l0.2002 and the recovery certificate has been issued. Under the said recovery certificate it is inter alia stated that the bank must recover first from the movable and immovable property of the principal borrower and thereafter from the other respondents who are sued in the capacity as guarantors.It is the case of the petitioners that they had no knowledge or notice of the said application and therefore they did not remain present before the authorities.It is the case of -6- the petitioners that the petitioners received notice of attachment of their property pursuant to the said recovery certificate and therefore moved a revision application being Revision Application no. l82 of 2005. The said revision application has been dismissed for non compliance of the provisions of section l54(2A) of the said Act, which order is challenged before me in this petition. 4. In Writ Petition No.5670 of 2005 the facts are identical and another loan which was granted by the bank has been the subject matter of the said writ petition. 5. In Writ Petition No. l0772 of 2005 the facts are that pursuant to a loan obtained from the respondent no l bank and for non payment thereof the respondent no. 4 moved an application under section l0l of the said Act which was granted. The respondent no.2 is the Vikas Sahakari Coop Bank Ltd. The said recovery certificate was challenged by filing revision application sometime in or about 24.8.2000. The said revision application was dismissed on l4.9.2004 once again for non compliance of the provisions of section l54(2A) of the said Act and it is this order which is challenged in this petition. -7- 6. The learned counsels for the petitioners have contended before me that the provisions of amended section l54(2A) which are introduced by the Amending Act No.4l of 2000 on 23.8.2000 have no retrospective operation and thus cannot apply to the proceedings which were initiated prior to the said Amending Act coming into operation on 23.8.2000. It is their contention that right to file revision is crystallized and became vested as on the date when the application is made for issuance of recovery certificate by the respondent banks under the provisions of section l0l of the said Act . It is contended that by the amending provisions of section l54(2A) of the said Act vested right of filing revision which is crystallized as on the date of filing of the recovery certificate application under section l0l of the said Act cannot be deprivated or can be affected by subsequent amendment to the provisions of the said Act. It is further contended that the provisions of section l54(2A) of the said Act are prospective in effect and are not retrospective and, therefore, only applies to those proceedings which are initiated for the first time after the Amending Act was introduced on 23.8.2000. All the petitioners have placed strong reliance on the -8- judgment of the Apex Court in the case of Ramesh Singh and anr vs Cinta Devi and ors reported in l996(3) SCC l42, and more particularly reliance is placed on paras 4 and 5 thereof which is reproduced herein below: "4. The High Courts of Allahabad and Madhya Pradesh have, vide Oriental Insurance Co Ltd vs Dhanram Singh, AIR l990 All l04 and Jaswant Rao vs Kamlabai AIR l990 MP 354 held that in such circumstances the appellant’s right to appeal without being required to make the deposit under the first proviso to section l73 of the New Act remains unaffected . However, the judgment impugned herein takes a different view. Hence there is controversy which needs to be resolved. 5. In our view the point at issue stands squarely covered by three decisions of this court reported in Hoosein Kasam Dada (India) Ltd vs State of M P, l953 SCR 987, State of Bombay vs. Supreme General Films Exchange Ltd, AIR l960 SC 980, and Vithalbhai Naranbhai Patel vs CST AIR l967 SC 344. In all these decisions the view taken is that unless the New Act expressly or by necessary -9- implication makes the provision applicable retrospectively, the right of appeal will crystalise in the appellant on the institution of the application in the Tribunal of first instance and that vested right of appeal would not be dislodged by the enactment of the New Act. In other words,the appellant would be entitled to file the appeal without being required to make the deposit under the proviso to section l73 of the New Act. The law therefore seems to be fairly well settled by the said three decisions of this court" 7. The learned counsel for the petitioners have thereafter relied upon the judgment of the Apex Court in the case of M/s Hoosein Kasam Dada (India) Ltd vs. The State of Madhya Pradesh and ors, AIR l953 SC 22l reported in AIR and particularly para 8 thereof has been relied upon. The petitioners have also relied upon a judgment in the case of Vithalbhai Naranbhai Patel vs. Commissioner of Sales Tax,M P Nagpur, AIR l967 SC 344 . Both the aforesaid judgments are referred to and relied upon by the Apex Court in the case of Ramesh Singh (supra) and have taken the similar view. By relying upon the aforesaid judgments it has been -10- contended that filing of revision proceedings is vested right and similar to the appeal and thus by subsequent Amending Act said vested right cannot be deprivated or denied. 8. It is also contended by the petitioners by relying upon the judgment in the case of Hitendra Vishnu Thakur and ors vs State of Maharashtra and ors, reported in (l994) 4 SCC 602, and particularly paras 25 and 26 thereof by which the Apex Court has held that the Amending Act cannot operate retrospectively so as to deprive the vested right in a party, unless it specifically provides for the same. An issue of prospectivity or retrospectively has been considered by the Apex Court and in para 26 of the said judgment and the Apex Court has laid down certain guiding principles. One of the principles mentioned is that every litigant has a vested right in substantive law but no such right exists in procedural law. Another principle set out therein is that the procedural statute should not generally speaking be applied retrospectively where the result would be to create new disabilities or obligations or to impose new duties in respect of the transactions already accomplished. By relying upon the aforesaid principles the learned counsel for the petitioners -11- have contended that the aforesaid judgments make it clear that the right of revision is a vested right and such right must be protected and cannot be deprivated by putting additional condition of deposit of 50% of the amount awarded by the recovery certificate while filing revision application. 9. The petitioners have also relied upon the judgment of the division bench of this Court in the case of Kausalya Sampt vs Vasant Sahkari Bank Ltd and ors, 2004(4) Mah LJ 795, to which I am a party. In the said judgment the division bench of this court has upheld the constitutional validity of the provisions of section l54(2A) of the said Act. It is held therein that the section is valid and there is no infirmity or constitutional disability to hold that the provisions of the said section are ultravires. Another division bench of this court in the case of Vasundhara Ashokrao Patil vs Rajaram Bapu Sahakari Bank Ltd, 2003(4) Mah LJ 3l5 as well as the learned Single Judge in the case of Juhu Coop Housing Society Ltd Mumbai vs State of Maharashtra, 2004(2) Mah LJ 779 have dealt with the provisions of section l54. The case in Vasundara (supra) has no much relevance because the issue there was only whether in the light of the -12- provisions of section l54 the recovery certificate can be challenged under section 9l of the said Act or the remedy is by way of revision under section l54 of the said Act. In the case of Juhu Coop Housing Society (supra) the only question was that whether exercising power of revision is quasi judicial and whether revisional authority is required to apply his mind. A judgment of the Apex Court is also relied upon in the case of Land Acquisition Officer cum DSWO AP vs B V Reddy and Sons, reported in 2002(2) SCC 463 where the Amending Act no.60 of l984 introduced under the Land Acquisition Act was the subject matter of challenge and it was held that the same is not retrospective in effect. l0. On the other hand the learned counsel for the respondents have contended that there is distinction between the revisional jurisdiction and appellate jurisdiction. It has been contended that the appeal is a statutory right and is vested in a party by a statute and once there is a proceedings commenced then the said vested right stands crystallized in favour of the party who has filed the said proceedings. It has bee contended that the provision of revision and provision of appeal are both distinct and different, both in its form -13- and in its substance. It has been contended that the revisional power is the discretion vested in the authority and does not give any vested right in the party to claim the said right as a matter of law. It has been contended further that even in substance the jurisdiction exercised by the revisional authority is distinct than what is exercised by the appellate authority. It has been thus contended, relying upon the judgment of the Apex Court in the case of Ramesh Singh (supra) inter alia holding that the provision of deposit cannot be introduced subsequently for filing appeal because the right of the litigant stood crystallized as on the date of commencement of the litigation would not apply on the facts of the present case. It has been contended that revision is not a vested right and, therefore, the said proceedings can be controlled by the legislature by providing provision of deposit as has been done by the Amending Act no.40 of 2000 by introducing sub- section (2A) of section l54 of the said Act. It has been further contended that the jurisdiction of the authority in revision is narrower than what is conferred on the appellate authority. It is further contended that the appeal is a vested right in a person whereas the jurisdiction vested in the revision proceedings is discretionary and it is for -14- the authority to decide whether he should exercise the same or even to refuse to exercise the same. In the light of the aforesaid distinction it has been submitted that the contentions raised by the learned counsel for the petitioners have no merit and are required to be rejected. ll. The learned counsel appearing for the respondents and State of Maharashtra,in support of the aforesaid contention relied upon the judgment of the Apex Court in Everest Apartments Coop Housing Society Ltd Bombay vs State of Maharashtra and ors, AIR l966 SC l499 more particularly paras 5 and 6 thereof which read as under: "5.There is no doubt that s l5l is potential but not compulsive. Power is reposed in Government to intervene to do justice when occasion demands it and of the occasion for its exercise. Government is made the sole judge. This power can be exercised in all cases except in a case in which a similar power has already been exercised by the Tribunal under S l49(9) of the Act. The exception was considered necessary because the legality or the propriety of an order having once been considered, it would be an -15- act of supererogation to consider the matter twice. It follows, therefore, that Government can exercise its powers under S l54 in all cases with one exception only and that the finality of the order under S 23(3) does not restrict the exercise of the power. The word ‘final’ in this context means that the orders is not subject to an ordinary appeal or revision but it does not touch the special power legislatively conferred on Government. The Government was in error in considering that it had no jurisdiction in this case for it obliviously had. 6. There remains the question whether a party has a right to move Government. The Tribune Trust case is distinguishable and cannot help the submission that Government cannot be moved at all. The words of the two enactments are not materially equal.The Income Tax Act used the words ‘suo motu’ which do not figure herein. It is,of course,true that the words ‘on an application of a party’ which occur in s l50 of the Act and in similar enactments in other Acts, are also not to be found. But that does not mean that a party is -16- prohibited from moving Government. As Government is not compelled to take action unless it thinks fit, the party who moves Government cannot claim that he has a right of appeal or revision. On the other hand, Government should welcome such applications because they draw the attention of Government to cases in some of which Government may be interested to intervene. In many statutes, as for example the two major procedural Codes, such language has not on not inhibited the making of applications to the High Court, but has been considered to give a right to obtain intervention, although the mere making of the application has not clothed a party with any rights beyond bringing a matter to the notice of the Court. After this is done it is for the Court to consider whether to act or not. The extreme position does not obtain here because there is no right to interference in the same way as in a judicial proceedings. Government may act or may not act, the choice is of Government. There is no right to relief as in an appeal or revison under the two Codes. But to say that Government has no jurisdiction at all -17- in the matter is to err and that is what Government did in this case". l2. In Writ Petition No.5329 of 2005 an additional point has been raised by the learned counsel for the petitioners that even if the provision of revision application is applicable according to the contention of the respondents, still the said provisions of section l54(2A) would not apply to his case because he has filed the revision itself prior to the Amending Act was introduced in 2000and the said revision having been entertained, this question of applying the provisions of section l54(2A) do not rise . It has been contended that even ifthe respondents are right then also the provisions of section l54(2A) would only apply to those cases where revisions are filed subsequent to the introduction of amending provision and not prior thereto. l3. I have considered the rival submissions of the parties and I am of the opinion that the issue raised which is required to be determined is whether revisional jurisdiction gives vested right in a litigant as on the date when the application forn recovery of the dues under sec.101 of the Act has been filed and if it is so then obviously in -18- the light of the judgment of the Apex Court in Ramesh Singh (supra) the provisions of section l54(2A) of the said Act cannot be made applicable to a case where revision application is filed prior to the Amending Act no.40 of 2000 which has been brought into force on 23.8.2000 by the respondent- State Government. However if the revision is not conferring a vested right on a litigant then the ratio of the aforesaid judgment would not apply and the provision of section l54(2A) of the said Act would be applicable even in cases where revision is filed after introduction of the said amending provisions irrespective of the fact that an application for recovering the dues by the bank was instituted prior to the introduction of the amended provisions or not. l4. The distinction between the revision and appeal is well recognized. The well settled distinction was brought out by the Apex Court in the judgment in the case of Hari Shankar and ors; vs. Rao Girdhari Lal Choudhury. AIR l963 SC 698. While considering the jurisdictional test of revision under section ll5 of the Code of Civil Procedure, l908 vice versa jurisdiction of the appellate authority the Apex Court has succinctly set out that both jurisdictions are totally -19- distinct and different and cannot be held to be synonymous. In para 7 of the said decision it has been observed as under: "The distinction between an appeal and a revision is a real one. A right of appeal carries with it a right of rehearing on law as well as fact,unless the statute conferring the right of appeal limits the rehearing in some way, as has been done in second appeals arising under the Code of Civil Procedure. The power to hear a revision is generally given to a superior court so that it may satisfy itself that a particular case has been decided according to law. Under section ll5 of the Civil P C the High Court’s powers are limited to see whether in a case decided, there has been an assumption of jurisdiction where none existed, or a refusal of jurisdiction where it did, or there has been material irregularity or illegality in the exercise of that jurisdiction. The right there is confined to jurisdiction and jurisdiction alone. In other Acts the power is not so limited, and the High Court is enabled to call for the record of a case to satisfy -20- itself that the decision therein is according to law and to pass such orders in relation to the case, as it thinks fit". l5. Once again in the case of The State of Kerala vs K M Charia Abdulla and Co, AIR l965 SC l583 the Apex Court has held in paras l7 and l9 as under: ".... It cannot, therefore be said that a provision which confers upon the appellate or revising authority power to make such inquiry as such appellate or revising authority considers necessary in itself amounts to enlarging the revisional or appellate jurisdiction. The only difference between the Income Tax Acts and the Madras General Sales Tax Act is that whereas the power to entertain the appeal or revision application and to make orders for further enquiry in the hearing of the appeal or revision is wholly dealt with by the provisions of the Income Tax Acts, under the Madras General Sales Tax Act the revisional jurisdiction and appellate jurisdiction are conferred by the Act, but the power of the appropriate authority in the exercise of the jurisdiction when it appears to the -21- appellate or revising authority that the correct amount of tax payable by the dealer has not been paid to make a further inquiry as the authority considers necessary is