LETTERS PATENT APPEAL No.727 OF 2006 (Against the order dated 08.09.2006 passed in CWJC No. 3614 of 2006) NAWADA CENTRAL CO-OPT.BANK,NAWADA THROUGH ITS MANAGING DIRECTOR ------------------------------- RESPONDENT/APPELLANT VERSUS 1. NAWAL KISHORE PRASAD SINGH, SON OF LATE JAGESHWAR SINGH, RESIDENT OF VILLAGE-ORAINAY, POLICE STATION- MUFASSIL, DISTRICT-NAWADAH 2. KABINDRA DAO, SON OF LATE MUSAFIR SINGH, RESIDENT OF VILLAGE-RAMNAGAR, P.S, NAGAR THANA, DISTRICT- NAWADAH ………… PETITIONERS/RESPONDENTS/IST PARTY 3. THE STATE OF BIHAR THROUGH THE REGISTRAR, CO-OPERATIVE SOCIETIES, PATNA ……………. RESPONDENT/2ND PARTY. 4. MOTOR TRANSPORT CO-OPERATIVE SOCIETY, NAWADAH THROUGH ITS SECRETARY 5. THE DISTRICT CERTIFICATE OFFICER, NAWADAH ……… RESPONDENTS/3RD PARTY. -WITH- LETTERS PATENT APPEAL No.30 of 2009 1. THE CENTRAL CO-OPERATIVE BANK LIMITED, AURANGABAD, THROUGH ITS MANAGING DIRECTOR, NAMELY, SHRAWAN KUMAR, SON OF LATE ABHIMANYU SINGH, RESIDENT OF VILLAGE- NAROTTAMPUR, P.S. KAJRA, DISTRICT- LAKHISARAI 2. SHRAWAN KUMAR, SON OF LATE ABHIMANYU SINGH, RESIDENT OF VILLAGE- NAROTTAMPUR, P.S. KAJRA, DISTRICT- LAKHISARAI -------- RESPONDENTS/APPELLANTS VERSUS 1. THE BIHAR STATE CO-OPERATIVE BANK LIMITED, BUDHA MARG, PATNA, THROUGH ITS GENERAL MANAGER 2. THE DEPUTY GENERAL MANAGER (FINANCE), BIHAR STATE CO- OPERATIVE BANK LTD. , BUDHA MARG, PATNA -------------------RESPONDENTS/Ist Set. 3. THE DISTRICT CO-OPERATIVE OFFICER-CUM-CERTIFICATE OFFICER, AURANGABAD. 4. THE SUPERINTENDENT OF POLICE, AURANGABAD. ……………………. RESPONDENTS/2nd Set 5. JAY MANGAL SINGH, SON OF SHRI KAMTA SINGH, RESIDENT OF PARISAD BAZAR, P.S. AND DISTRICT-AURANGABAD. …………….. WRIT PETITIONER- RESPONDENT/3rd Set 2 For the Appellants: (1) Mr. Devendra Pd. Singh (2) Mr. Kamlesh Kumar Sharma For the Respondents: (1) Mr. Ram Suresh Rai, Sr. Advocate (2) Mr. Arbind Kumar Singh, Advocate P R E S E N T THE HON'BLE MR. JUSTICE SHIVA KIRTI SINGH THE HON'BLE MR. JUSTICE HEMANT KUMAR SRIVASTAVA Shiva Kirti Singh & Hemant Kumar Srivastava.JJ. Heard learned counsels for the appellants and learned counsels appearing for the respondents in both these appeals preferred under Clause-10 of the Letters Patent of this court. 2. Appellants in both the cases are different branches of the Central Cooperative Bank Ltd and/or its officials. They are aggrieved by judgments and orders passed by learned Single Judges of this court allowing the writ petitions preferred by the respondents on the ground that the bank had advanced loan admittedly to a Cooperative Society and therefore, it could recover the loan through Certificate Proceeding only from the concerned Cooperative Society and not from its office bearers who can only be formal parties because a juristic person needs to be represented through some real person. According to the judgments under appeal, the liability of office bearers or 3 members of Cooperative Society registered under the Bihar Cooperative Societies Act is limited as per by laws of the society and a liability of the Cooperative Society can be fastened on its members only in accordance with provisions of the Cooperative Societies Act. 3. The stand of the appellants is that the office bearers of the concerned Cooperative Societies acted fraudulently and as a fact, the loan amount was used by the individual office bearers or members concerned because the Cooperative Societies happened to be mere facades and were really in the pockets of the officer bearers. 4. The learned writ court has relied upon judgments of this court in support of an established principle that a company is a separate juristic person and the liabilities of the company cannot be fastened on its individual share holders because the liability of share holders is always limited to the value to their shares. Some judgments have been brought to our notice which show that in case of a Cooperative Society also the liabilities may be fastened upon the members of the society but this has to be in accordance with provisions of Section-54 of the Bihar Cooperative Societies Act. This proposition of law is not disputed. 5. Learned counsels for the appellants admit that no recourse was taken to the provisions of Section-54 of the 4 Act and hence they seek leave of this court to pursue their remedy through appropriate proceedings under the Bihar Cooperative Societies Act. 6. In the facts of the case, we find no infirmity in the judgments and orders of the learned Single Judges which are impugned in these appeals. Hence, the appeals are dismissed. However, as prayed on behalf of the appellants, it is made clear that the appellant-bank shall have full liberty to proceed against the writ petitioners or any other person for recovery of their loan; both under the provisions of Bihar Cooperative Societies Act or under any other appropriate law before a competent Authority, court or tribunal in accordance with law. Patna High Court Dated, the 12th day of August, 2010 NAFR/AKV/- (Shiva Kirti Singh,J.) (Hemant Kumar Srivastava,J.)