1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD WRIT PETITION NO.2776 OF 2009 Shri Mumbadevi Jilha Nagari Sahakari Pat Sanstha Maryadit, Kopargaon, having its Head Office at Old Municipality Road, Near Shivaji Statue, Kopergaon, Dist-Ahmednagar, through its Manager & authorized signatory Shri Abhay Parabhakarrao Patil, R/o-Kopargaon, Dist-Ahmednagar. ...PETITIONER. VERSUS 1) Shri Vijay Shamrao Bhokre, 2) Shri Sanjay Shamrao Bhokre, 3) Shri Satish Shamrao Bhokre, 4) Shri Deepak Manikchand Pande, 5) Shri Pramod Harbhau Wani, All R/0-Kopargaon, Dist-Ahmednagar, 6) The Assistant Registrar, Co-operative Societies, Kopargaon, Dist-Ahmednagar, 7) The Special Recovery and Sales Officer, Maharashtra State Co-operative Pat Sanstha Federation, 2 C/o-Mumbadevi Jilha Nagari Sahakari Pat Sanstha Maryadit, Bhagwan Mahavir Path, Kopargaon, Dist-Ahmednagar. ...RESPONDENTS. ... Mr.S.V. Adwant Advocate for Petitioner. Mr.S.D. Kulkarni Advocate for Respondent Nos. 1 to 3. Mr. N.B. Patil, A.G.P. for Respondent No.6. ... CORAM: K.K. TATED, J. ORDER RESERVED ON : 4TH SEPTEMBER, 2009. ORDER PRONOUNCED ON: 18TH SEPTEMBER, 2009 ORDER : 1. By this Petition under Articles 226 and 227 of the Constitution of India, the Petitioner is challenging the order dated 7th April, 2009 passed by the Judge, Co-operative Court, Kopergaon below Exhibit 5 in Dispute No.163/2009. Petitioner is original defendant No.1 whereas Respondent Nos. 1 to 3 are original plaintiffs in Dispute No.163 of 2009. It is the case of the Petitioner that Petitioner has advanced a mortgage loan to Smt. Indumati Shamrao 3 Bhokre against the security of her immovable property being survey No.57/1+2A admeasuring 9057.5 Sq. mtrs. situated at Jeur Patoda, Tq-Kopargaon, Dist-Ahmednagar. As the borrower defaulted in the repayment of the loan facility available to her, the Petitioner issued notice to the borrower calling upon her to repay the amount of loan along with interest. On the death of original borrower, an application came to be filed under Section 101 of the Maharashtra Co-operative Societies Act, 1960 for issuance of recovery certificate against legal heirs. The said certificate is granted by the Assistant Registrar dated 10th September, 2007. Subsequently, the suit came to be filed by the present Respondent Nos. 1 to 3 for the declaration that the recovery certificate dated 10th September, 2007 is null and void. Respondent Nos. 1 to 3 initially filed Special Civil Suit No.112 of 2007 against the Petitioner restraining them from recovery of said loan amount. In the said Special Civil Suit No.112 of 2007 the Petitioner filed application raising objection to the maintainability 4 of the suit. The said application came to be rejecte4d by order dated 13th December, 2007 by the Civil Judge, Senior Division, Kopargaon. Therefore the Petitioner preferred Writ Petition No.1356 of 2008 in this Court. This Court (Coram: B.R. Gavai, J.) by order dated 25th November, 2008, passed the following order: " 7. Hence, the petition is partly allowed. (i) The recovery certificate dated 10th September 2007 issued by the respondent no.6 is quashed and set aside. The matter is remitted back to the Assistant Registrar, Cooperative Societies, Kopargaon, for deciding the questions of issuance of recovery certificate after hearing the petitioner and the legal representatives of the deceased borrower i.e. respondent nos. 1 to 3. (ii) Parties to appear before respondent no.6 on 15th December, 5 2008. In that view of the matter, requirement of formal notice shall stand waived. (iii) Special Civil Suit No. 112/2007 on the file of Civil Judge (Senior Division), Kopargaon, stands disposed of as withdrawn. However, the order of injunction, which is granted by the trial court, shall be operative till the respondent no.6 decides the matter regarding issuance of recovery certificate afresh, and for a further period of 15 days from the date of communication of the said order to the respondent nos. 1 to 3. (iv) The respondent no.6 is directed to decide the matter as expeditiously as possible and preferably with a period of three months from the date of appearance of the parties before him." 2. Thereafter the Petitioner filed Application No. 1872 of 2007 for issuing certificate under Section 101 of the Maharashtra Co-operative Societies Act. 6 After hearing both the sides, Assistant Registrar, Co-operative Societies, passed order dated 18th February, 2009 and allowed Petitioner's Application under Section 101 of the said Act and issued recovery certificate for the sum of Rs.12,41,431/-. Thereafter Respondent Nos. 1 to 3 filed Dispute before the Co-operative Court No.2, Kopargaon being Dispute No.163 of 2009 on 7th April, 2009 challenging the order passed by the Assistant Registrar, Co-operative Societies dated 18th February, 2009 passed under Section 101 of the Maharashtra Co-operative Societies Act and for other reliefs. In the said Dispute No.163 of 2009, the Respondent Nos. 1 to 3 preferred application for stay of the recovery certificate/ order dated 18th February, 2009 passed by the Assistant Registrar, Co-operative Societies under Section 101 of the Maharashtra Co-operative Societies Act. On the said Application, the Judge, Co-operative Court, Kopargaon passed interim order dated 7th April, 2009 restraining the Petitioner from recovering loan amount from Respondent Nos. 1 to 3 till 24th April, 7 2009. The said order was challenged by the Petitioner in the present Petition on the ground that the Co-operative Court, Kopargaon acted as an appellate authority by sitting in Judgment over the certificate issued by the Assistant Registrar, Co- operative Societies, Kopargaon under Sub-section 1 and 2 of Section 101 of the Maharashtra Co-operative Societies Act, which is against law. The learned counsel for the Petitioner also submits that once the certificate under Section 101 of the Maharashtra Co-operative Societies Act is issued, the same cannot be challenged before the Co- operative Court in Dispute under Section 91 of the Maharashtra Co-operative Societies Act. He further submits that the proceeding under Section 101 of the Maharashtra Co-operative Societies Act are of quasi judicial nature and hence cannot be interfered with by the Co-operative Court under Section 91 of the Maharashtra Co-operative Societies Act. Learned counsel for the Petitioner in support of his contention relied on the Judgment in the matter of Vasundhara Ashokrao Patil vs. Rajaram Bapu Sahakari 8 Bank Ltd., Sangli and others, reported in 2003 (8) LJSOFT Page 43. In that case, the Division Bench of Bombay High Court held that dispute relating to the recovery certificate granted under Section 101 cannot be challenged under Section 91 and the only remedy is to file revision application under section 154 of the Maharashtra Cooperative Societies Act. Para 6 of the said Judgment reads as under: "6 The opening words of section 101 "Notwithstanding anything contained in sections 91, 93 and 98" gives overriding effect to the said section. Therefore, for recovery of loans, subscription, seasonal finance etc. it is not necessary for the society to refer the dispute to the Co-op. Court under sec.91. The plain reading of section 101 reveals that a special class of societies is carved out who can apply to the competent authority under sec.101 and those societies alone can obtain recovery certificate in accordance with the said section. The provisions of section 91 and 101 are 9 separate and distinct and act in different spheres. By virtue of Sec. 101 a summary and speedy remedy has been provided to certain types of societies. Further it is to be noted that by virtue of sec.101 finality is attached to the certificate granted by the Registrar under this section. it is, therefore, clear that the certificate issued under sec.101 cannot be challenged under sec.91. Only remedy of the party aggrieved is to file revision application under sec.154 of the Maharashtra Co-operative Societies Act. Sec.101 is a speedy remedy to recover the amount and when statute gives finality to the action or order it can be challenged only in a manner prescribed by statute. Therefore, a dispute under Sec.91 would be completely barred. We may mention that two learned single Judges of this Court have take a view that certificate under sec.101 is final and conclusive and the dispute to challenge the certificate cannot be filed under sec.91. (See Shri Kedarling Vikas Seva Scy. Ltd. 10 Vs. Dinkar Bhimrao Raut & Ors., 2003 (1) LJSOFT 106 = 2003 (1) ALL MR 66 and Bhusawal People's Bank Ltd. Vs. Vijay Ramdas Rane and ors.(Writ Petition No. 2277 of 2001 decided by Naik J. on 30th/31st January, 2002)" 3. Learned counsel for the Petitioner also relied on the Judgment in the matter of Kedarling Vikas Seva Society Ltd. vs. Dinkar Bhimrao Raut and others, reported in 2003(1) LJSOFT Page 106. In that case also the Bombay High Court held that certificate issued under Section 101 of the Maharashtra Co-operative Societies Act could not be challenged by filing a dispute under Section 91 of the Maharashtra Co-operative Societies Act. Learned counsel for the Petitioner also relied on the Judgment of Pukhraj s/o Mohanlal Vyas and others vs. Sanmitranagari Sahakari Pata Sanstha Limited and another, reported in 2007 (4) LJSOFT Page 85. In that case also the Bombay High Court held that certificate issued under Section 101 of the Maharashtra Co-operative Societies Act could not be 11 challenged by preferring dispute under Section 91 of the Maharashtra Co-operative Societies Act. Para 15 of the Judgment reads as under: "15. It is, therefore, clear that when provisions of Maharashtra Cooperative Societies Act, provide for a remedy of revision and said order has been made final, the petitioners could not have raised any dispute under Section 91 of the act to challenge the recovery certificate issued under Section 101 of the Act. However, the petitioners contend that dispute under Section 91 of the Act is tenable because of orders of this Court dated 29.7.2005 in Writ Petition No.2460 of 2005. After perusal of judgment of this Court dated 29.7.2005, I am not in a position to accept this argument. After briefly mentioning the facts and rival contentions in first four paragraphs, in paragraph 5 this Court has found that the interest of justice would be met if it is directed that the impugned order 12 should not be given effect to until a decision is given by Cooperative Court in the dispute filed by the petitioners. It, therefore, apparent that this Court has not quashed and set aside the issuance of recovery certificate in any way or revisional order maintaining it. This Court has also not said anything about tenability of dispute under Section 912 of the Act or otherwise. In paragraph 6 of said judgment, this Court has directed the petitioners to furnish bank guarantee of Rs. Three lakhs with Cooperative Court and in paragraph 7 it has been made clear that in default, the recovery certificate would become operative immediately. In par4agraph 8, the learned Single Judge has clarified that the4 Cooperative Court would decide the dispute on its own merits without being influenced by any observations made by any of the authorities. It is, therefore, not possible to interpret this judgment to mean that this Court has permitted proceedings under Section 91 of the Act to go on merits and 13 any challenge to those on the ground of tenability of proceedings was foreclosed. The Cooperative Court has not properly considered the observations of the learned Single Judge of this Court in this respect while answering issues No.14 and 15 before it." 4. In view of the above mentioned submissions, learned counsel for the Petitioner submitted that the impugned order dated 7th April, 2009 passed by the Co-operative Court below Exhibit 5 in Dispute No.163 of 2009 is liable to be quashed and set aside. He further submitted that it is to be held that Dispute No.163 of 2009 filed by Respondent Nos. 1 to 3 against the Petitioner and others before the Co-operative Court-I, Kopargaon is without cause and there is a complete bar in trying and entertaining the dispute after the adjudication of the legality under Section 101 (3) of the Maharashtra Co- operative Societies Act. 5. On the other hand, learned counsel for 14 Respondent Nos. 1 to 3 states that Dispute No.163 of 2009 filed by them in the Co-operative Court, Kopargaon under Section 91 of the Maharashtra Co- operative Societies Act is according to law and same is maintainable. He submitted that Dispute under Section 91 of the Maharashtra Co-operative Societies Act is maintainable. He further submitted that Dispute under Section 91 of the said Act is just like a full-fledged trial, whereas proceedings under Section 101 of the Maharashtra Co-operative Societies Act for issuing recovery certificate is of quasi judicial nature. He further submitted that the parties can lead their evidence in the Dispute under Section 91 of the Maharashtra Co-operative Societies Act, whereas the proceedings under Section 101 of the Maharashtra Co-operative Societies Act is summary proceeding and there is no question of recording of any evidence. He further submitted that the recovery certificate issued under Section 101 of the Maharashtra Co-operative Societies Act can be challenged by preferring Dispute under Section 91 of the said Act. In support of his submission, learned 15 counsel for Respondent Nos. 1 to 3 relied on the reported Judgment in the matter of Shri Basaveshwar Co-operative Credit Society Ltd. Kolhapur vs. Jayant Shivpal Banchhode, reported in 2009 (1) ALL M.R. Page 908. In that Case the Bombay High Court held that Co-operative Court has power to hear and decide stay application in a dispute filed under Section 91 of the Maharashtra Co-operative Societies Act till the decision of main proceedings before it in relation to Section 91 and also while dealing with a proceeding under Section 101 of the Act. In that case the Division Bench of this Court held that the Co-operative Court exercised its statutory power conferred on it under Section 91 of the said Act while the Registrar exercised the power under Section 101 of the said Act and they fell in distinct and different jurisdiction. On the basis of these submissions, learned counsel for Respondent Nos.1 to 3, submitted that the present Petition preferred by original defendant no.1 was liable to be dismissed with cost. He further submitted that the present Writ Petition became infructuous on the 16 ground that in the present case the Petitioner challenged the order dated 7th April, 2009 passed by the Judge, Co-operative Court, Kopargaon below Exhibit 5 in Dispute No.163 of 2009 whereas the Co- operative Court by its order dated 2nd May, 2009 rejected Respondent Nos. 1 to 3's application for extension of interim order and therefore the Petitioners also preferred Writ Petition No.3457 of 2009 in this Court. 6. It is admitted fact in the present case that Respondent Nos. 1 to 3 filed Dispute under Section 91 of the Maharashtra Co-operative Societies Act being Dispute No.163 of 2009 for declaration that as per the order dated 18th February, 2009 passed by the Assistant Registrar, Co-operative Societies under Section 101 of the Maharashtra Co-operative Societies Act, Petitioners have no right to sell their attached property for recovery of the loan amount. In the present case the certificate under Section 101 of the Maharashtra Co-operative Societies Act issued on 18th February, 2009 and 17 thereafter the Respondent Nos. 1 to 3 filed dispute under Section 91 of the said Act on 7th April, 2009. As per Section 154 of the Maharashtra Co-operative Societies Act, Revision is maintainable against the order dated 18th February, 2009. Instead of preferring Revision, Respondent Nos. 1 to 3 filed Dispute under Section 91 of the said Act. In any case considering the Judgments in the matter of Vasundhara Ashokrao Patil (supra), Kedarling Vikas Seva Society Ltd. (supra) and Pukhraj s/o Mohanlal Vyas (Surpa), it is crystal clear that dispute under Section 91 of the Maharashtra Co-operative Societies Act is not maintainable to challenge the recovery certificate/ order passed under Section 101 of the Maharashtra Co-operative Societies Act. The Authority in the matter of Shri Basveshwar Co- operative Credit Society Ltd. (supra) relied by Respondent Nos. 1 to 3 is not applicable in the facts and circumstances of the present Case. In that case borrower filed dispute under Section 91 of the said Act before proceeding under Section 101 of the Maharashtra Co-operative Societies Act initiated by 18 the Credit Society and applied for interim relief. Considering these facts, the Division Bench in that case, held that Co-operative Court had jurisdiction under Section 91 of the Maharashtra Co-operative Societies Act to entertain the dispute. Whereas in the present case after passing order of recovery certificate under Section 101 of the Maharashtra Co-operative Societies Act, the Respondent Nos. 1 to 3 filed their dispute under Section 91 of the said Act and there fore as the facts are altogether different, this Authority is not applicable in the present case. 7. Considering the Authorities cited by the learned counsel for the Petitioner, it is crystal clear that the Co-operative Court has no jurisdiction to entertain the dispute under Section 91 of the Maharashtra Co-operative Societies Act challenging the legality and validity of the recovery certificate / order passed by the Assistant Registrar, Co-operative Societies under Section 101 of the Maharashtra Co-operative Societies Act. 19 Therefore the Writ Petition is allowed in terms of prayer clause (B), (C) and (D), which reads as under: "(B) The proceeding in the nature of Dispute No.163/2009, filed by the respondents No.1 to 3 herein against the petitioner and pending before the Co-operative Court-2, Kopargaon and the order dated 7.4.2009 passed therein below Exh.5 be quashed and set aside. (C) It be declared that the respondents No.1 to 3 have no right, power and authority to challenge the recovery certificate issued by the respondents No.6 against them, under section 103 of the MCS Act, by filing a dispute under section 91 of the MSC Act. 20 (D) It be further held that the dispute No.163/2009, filed by the respondents No.1 to 3 against the petitioner and others, before the Co-operative Court-2, Kopargaon is without cause and there is a complete bar in trying and entertaining the dispute after the adjudication of the liability under Section 101 (3) of the MCS Act." 8. No order as to cost. [K.K. TATED, J.] asb/SEPT09/wp2776.09