1 WP Nos. 4638/11 & 4639/11 IN THE HIGH COURT OF JUDICATURE OF BOMBAY BENCH AT AURANGABAD WRIT PETITION NO.4638/2011 1) Aditya Agrotech Pvt. Ltd. H-84, N-4, CIDCO, Aurangabad Through its Directors. 2) Meena Bhivaji Jaybhaye Age:42 Yrs., occu. Business, R/o H-84, N-4, CIDCO, Aurangabad. 3) Ambadas s/o Shankar Bhavar Age: 37 Yrs., occu. Business, R/o H-84, N-4, CIDCO, Aurangabad. 4) Bhivaji s/o Bapurao Jaybhaye Age: 47 yrs., occu. Business, R/o H-84, N-4, CIDCO, Aurangabad. - PETITIONERS VERSUS 1) The State of Maharashtra Through the Secretary, Co-operation and Textile Department, Maharashtra State, Mantralaya, Mumbai. 2) The Assistant Registrar Cooperative Societies, (Deputation), Marathwada Urban Bank Cooperative Association, Urban Bank Bhavan, Plot No.27, Vikaspuri, Near Chinar Garden, Padegaon, Aurangabad. 3) The Deogiri Nagari Sahakari Bank Ltd., Arth Complex, Adalat Road, Aurangabad, Through its Manager. 4) The Special Recovery Officer, The Deogiri Nagari Sahakari Bank Ltd., Arth Complex, Adalat Road, Aurangabad. - RESPONDENTS WITH 2 WP Nos. 4638/11 & 4639/11 WRIT PETITION NO. 4639 of 2011 1) Aditya Agrotech Pvt. Ltd. H-84, N-4, CIDCO, Aurangabad Through its Directors. 2) Meena Bhivaji Jaybhaye Age:43 Yrs., occu. Business, R/o H-84, N-4, CIDCO, Aurangabad. 3) Ambadas s/o Shankar Bhavar Age: 40 Yrs., occu. Business, R/o H-84, N-4, CIDCO, Aurangabad. 4) Bhivaji s/o Bapurao Jaybhaye Age: 48 yrs., occu. Business, R/o H-84, N-4, CIDCO, Aurangabad. 5) Akshay Bhivaji Jaybhaye, Age: 21 Yrs., occu. Business, R/o H-84, N-4, CIDCO, Aurangabad. - PETITIONERS VERSUS 1) The State of Maharashtra Through the Secretary, Co-operation and Textile Department, Maharashtra State, Mantralaya, Mumbai. 2) The Assistant Registrar Co-cooperative Societies, (Deputation), Marathwada Urban Bank Co-operative Association, Urban Bank Bhavan, Plot No.27, Vikaspuri, Near Chinar Garden, Padegaon, Aurangabad. 3) The Deogiri Nagari Sahakari Bank Ltd., Arth Complex, Adalat Road, Aurangabad, Through its Manager. 4) The Special Recovery Officer, The Deogiri Nagari Sahakari Bank Ltd., Arth Complex, Adalat Road, Aurangabad. - RESPONDENTS 3 WP Nos. 4638/11 & 4639/11 ***** Mr.RT Nagargoje, Advocate for Petitioners ; Mr.VH Dighe, AGP for State. Mr.NK Tungar, Adv. for Resp.No.3.(caveator) ----- CORAM : K.U.CHANDIWAL, J. DATE : 1st DECEMBER, 2011. ORAL JUDGMENT: 1) Heard learned Counsel for the petitioners and the Bank. Rule, Rule made returnable forthwith. Both the writ petitions are heard together and disposed of, as common points/issues are involved therein. 2) The petitioners are borrowers of Respondent/Bank in two distinct accounts, failure on their part to repay, resulted in respondent/bank initiating recovery proceedings against them. The Bank approached the learned Assistant Registrar, under the Maharashtra Cooperative Societies Act, 1960 (hereinafter to be referred to as the said Act) with its case on 2nd February, 2010, annexing the documents and its claims and also the petitions. Notices were purported to have been served upon the writ petitioners. Petitioners submit, notices are not properly served. However, record placed before this Court and reflected in the certificates, display that there was proper service upon the writ petitioners in both the matters. 3) A moot question raised by the petitioners is, issuance of such certificate is a betrayal to the procedure in terms of Section 86E in particular, and 86A to E in general, as formality by virtue of Government Resolution dated 18th May, 2007, incorporated in Chapter-VIII-A of the Maharashtra Cooperative Societies Act and the Rules framed thereunder, is not followed. Consequently, it was expected of the learned Assistant Registrar to scrupulously act in tune to the requirement under Rules 86-A to 86-F of Maharashtra Cooperative Societies Rules, 1961. 4) The certificates in both the matters indeed conceive primary requirement of Rules 81A and 86A to 86E. However, the gaffe and omission, has 4 WP Nos. 4638/11 & 4639/11 apparently crept in while traversing with Rule 86F. 5) Rule 86F conceive - after hearing the arguments of the parties, the “ Registrar shall issue a reasoned judgment and pass an order for the grant or rejection of the application. The Registrar, thereafter, shall issue certificate in Form- V. The judgment and the certificate shall bear his seal and signature and the date. 6) Mr. Nagargoje submits, these compliances are not complied. This approach has been criticized in catena of judgments by this Court, including accepting this legal position in LPA in the matter of Sandeep Polymers Pvt. Ltd Vs State of Maharashtra and Ors. 2010 (6) ALL MR 550 – . 7) Mr. Tungar, learned counsel for the Bank, submits that the purported certificate, to which reference is given with criticism, in its body, deals with reasoning by the learned Assistant Registrar for his arriving to the conclusion of dues against the petitioner. 8) The learned Counsel as also learned AGP submit in order to deviate applicability of Section 154 of the Maharashtra Cooperative Societies Rules, 1961 and to avoid rigor thereof, a short-cut mode/remedy, not permitted, of writ jurisdiction, is accelerated. 9) Learned AGP also submits that the Assistant Registrar has given due opportunities to the petitioner and thereafter based on the documents placed having fully satisfied, issued the impugned certifications. 10) With the assistance of both the learned Counsel, the impugned certificates/the order, is perused. Keeping in juxtaposition, prescribed format-V. Most surprisingly the recitals in the so-called judgment, as contemplated by Mr. Tungar, is a replica of the form-V, required to be issued as certificate under Section 101 of the said Act. The submission, that the order is a reasoned order, is a hollow, it is not in conformity to the compliance of Rule 86F. Reading the aforesaid Rule 86F, primarily two situations emerge, the Assistant Registrar as a competent authority, has, in first part of those Rules, has to hear the parties, pass a reasoned order. Even if he has to reject or grant the certificate, such reasoned order is contemplated. 5 WP Nos. 4638/11 & 4639/11 The sentence in Rule 86F starts with the term Registrar, thereafter, shall issue........ “ ” It is more than clear, the former is the mandatory requirement of hearing, recording judgment thereafter a certificate is to be issued. To repeat, here the certificate is in the prescribed form does not depict of reasons of learned Assistant Registrar, what made him to grant the certification under challenge. 11) It is well settled, reasons of any order are heart-beat of every conclusion apart from being an essential feature of principles of natural justice.. Consequently in absence of such reasons, the certifications call interference, warranting its quashment. Though objection in terms of Section 154 of the said Act was raised, however, this has been considered by the Division Bench. That apart, during the course of submissions Mr. Nagargoje, on instructions, showed willingness to deposit certain amount by way of petitioner s bonafide and good gesture, ’ accepting this position, the rigor of Section 154 of the Act naturally is now diluted. Hence, order : (i) The impugned Certificates are set aside; (ii) The writ petitioners to deposit, directly with the Bank, in both loan accounts, consolidated sum of Rs.20,00,000/- (Rupees twenty lakhs) up to 10th January, 2012. Such deposits, will be without prejudice to the rights of the petitioners to challenge the legality of the claims raised by the Bank. (iii) Both the parties to appear before the learned Assistant Registrar, Cooperative Societies, on 15th December, 2011.. 12) Rule made absolute in the aforesaid terms with no order as to costs. sd/- (K.U.CHANDIWAL) JUDGE bdv/