1 WP 3031.98 ndm IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 3031 OF 1998 The Laxmi Cooperative Bank Ltd. ... Petitioner Versus Abdulgani Navabsaheb Wadavan and others. ... Respondents ----- Mr. Drupad S. Patil for the Petitioner. Ms Chaitrali Deshmukh a/w Mr. I.M.Khairdi for Respondent No.1. ----- CORAM : A.S.OKA, J. DATE : 24 th August, 2011. ORAL JUDGMENT: 1 Heard the learned counsel appearing for the Petitioner and the learned counsel appearing for the Respondent No.1. 2 The Petitioner – Bank filed a dispute under Section 91 of the Maharashtra Co-operative Societies Act, 1960 (hereinafter referred to as “the said Act”) for recovery of an amount allegedly advanced to the Respondent Nos.1 and 2. An award was made by the Co- operative Court. Recourse was taken to Rule 107 of the Maharashtra 2 WP 3031.98 Co-operative Societies Rules, 1961 (hereinafter referred to as “the said Rules”). In execution, the Respondent No.3 (Special Recovery Officer) attached bank account and the amount standing to the credit of the said Bank account was transferred to the loan account. A revision application was filed raising an objection to the attachment of the amount of Rs.1,00,000/- and consequent transfer of the said amount to the loan account. By the judgment and order impugned in this petition dated 7 th April, 1998, the revision application was allowed and the order of attachment was set aside. The operative part of the impugned order reads thus: “The order of attachment of the account of the applicant's firm is hereby set aside. The bank is directed to release the account of the firm of the applicant and to exhaust all the remedies to recover the due amount from the principle borrower and after exhausting all the remedies, taken approach towards the guarantors in their chronological order. No order as to cost.” 3 The learned counsel appearing for the Petitioner submitted that by the impugned order, the Revisional Authority has directed the 3 WP 3031.98 Petitioner to exhaust the remedies against the principal borrower and thereafter, proceed against the guarantors. He submitted that the said direction is contrary to the law laid down by the Apex Court in the case of State Bank of India Vs. M/s Indexport Registered and others [(1992) 3 Supreme Court Cases 159]. He submitted that the liability of the guarantors is co-extensive with the liability of the principal borrower. He submitted that in any event, there was no occasion to give such a direction while deciding the revision application. He submitted that the Respondent No.1 did not raise any objection to the attachment in accordance with Sub-Rule 19 of Rule 107 of the said Rules and therefore, the revision application itself was not competent. 4 The learned counsel appearing for the Respondent No.1 invited attention of the Court to the communication dated 27 th June, 1989 issued by the Additional Registrar of the Co-operative Societies, Pune. The learned counsel submitted that the Divisional Joint Registrar has followed the guidelines issued by the Additional Registrar. The learned counsel supported the impugned judgment and 4 WP 3031.98 order. The learned counsel submitted that if this Court is inclined to set aside the impugned order, liberty may be granted to raise an objection to the attachment. 5 I have given careful consideration to the submissions. I have perused the revision application filed by the Respondent No.1. In substance, the challenge in the revision application is to the attachment of an amount in account No.608 of M/s. Wadwan Weaving Mills made by the Special Recovery Officer. The Respondent No.2 is the borrower of the Petitioner and the Respondent No.1 was described by the Petitioner as the guarantor. For executing the award made by the Co-operative Court, recourse was taken to clause (b) of Sub- Section 1 of Section 156 of the said Act. The execution proceeded in accordance with the Rule 107 of the said Rules and the Special Recovery Officer/ Sale Officer passed an order of attachment of the amount in the aforesaid account. Under clause (a) of Sub-Rule 19 of Rule 107 of the said Rules, a remedy is available to raise an objection to the attachment. If such objection is raised and is not found to be 5 WP 3031.98 frivolous, the Recovery Officer is under an obligation to investigate into the claim made under the objection. The Objector is also entitled to filed a suit to establish his right in the event the objection is overruled. The Respondent No.1 did not raise any such objection and filed a revision application. The learned counsel appearing for the Petitioner is right when he relied upon the decision in the case of State Bank of India (supra) in support of the contention that the liability of the guarantor is co-extensive with that of the borrower and therefore, the Authority executing the award cannot be told to execute the award firstly only against the borrower and thereafter, against the guarantor. 6 However, it is not necessary to go into the merits as the learned counsel appearing for the Respondent No.1 has stated that the Respondent No.1 will apply under clause (a) of Sub-Rule 19 of Rule 107 of the said Rules. 7 Hence, I pass the following order: i. The impugned order dated 17 th April, 1998 is 6 WP 3031.98 quashed and set aside and the Revision Application No.523 of 1997 stands dismissed with liberty to the Respondent No.1 to raise an objection in terms of clause (a) of Sub-Rule 19 of Rule 107 of the Maharashtra Co-operative Societies Rules, 1961 within a period of eight weeks from today ; ii. If such an objection is filed within the stipulated time, the concerned Officer shall decide the same in accordance with law as expeditiously as possible on its own merits ; iii. All the contentions of the parties on merits are kept open; and iv. The rule is made absolute on above terms with no order as to costs. [ A.S.OKA, J ]