2017 (11) TMI 1972 - HC - Indian Laws

Seeking direction to the 1st respondent to release the amounts due under the matured Fixed Deposits - Invocation of power of discretionary remedy under Article 226 of the Constitution of India - HELD THAT - The said issue was considered by a learned Single Judge of this court in W.P.(C) No.18243/2015 filed against the 1st respondent society, in THE CHOONDACHERRY SERVICE CO-OPERATIVE BANK LTD. VERSUS THE MEENACHIL RUBBER MARKETING PROCESSING CO-OPERATIVE SOCIETY LTD., THE MANAGING COMMITTEE OF THE MEENACHIL RUBBER MARKETING PROCESSING CO-OPERATIVE SOCIETY LTD. REPRESENTED BY PRESIDENT, KOTTAYAM, THE JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL) , KOTTAYAM 2017 (7) TMI 1403 - KERALA HIGH COURT , and held as per the judgment dated 5.7.2017 that, the nature of the provisions and the regulatory powers conferred on the Registrar under the Cooperative Societies Act and Rules, 1969, makes it clear that, there is no inhibition created in directing to release the matured fixed deposit, and further held that, the writ petition is maintainable against the 1st respondent society. If the 1st respondent is carrying on with the banking business based on the permission granted by the Registrar of Co-operative Societies, then the public law remedy is available to the petitioner since the banking business is carried on by the 1st respondent under the supervision and control of the Registrar of Co-operative Societies. Even though petitioner has approached the Registrar of Co-operative Societies seeking appropriate directions, no direction was issued. In that view of the matter also, it can be seen that, the writ petition is perfectly maintainable against the 1st respondent society. The petitioner is entitled to succeed in the writ petitions - petition allowed.

Summary

Issues:
1. Interpretation of the Kerala Co-operative Societies Act, 1969 regarding the authority and powers of cooperative societies.
2. Whether cooperative societies registered under the Act fall within the ambit of Article 12 of the Constitution of India.
3. Maintainability of a writ petition against a cooperative society seeking the release of matured fixed deposit amounts.
4. Power of discretionary remedy under Article 226 of the Constitution of India to grant directions for the release of matured fixed deposit amounts.
5. Legality of a cooperative society carrying out banking business without a license from the RBI.
6. Availability of public law remedy against a cooperative society operating under the supervision of the Registrar of Co-operative Societies.
7. Dispute regarding the nature of amounts received under fixed deposit receipts.

Analysis:
1. The judgment involved a cooperative bank seeking the release of amounts due under matured fixed deposits from the first respondent, a cooperative society. The first respondent contended that as a body corporate under the Kerala Co-operative Societies Act, 1969, it had the power to manage its affairs independently, with final authority vested in its general body of members.

2. The first respondent argued that previous judgments, including those by the Apex Court and the High Court, had addressed the issue of whether cooperative societies registered under the Act could be considered state actors under Article 12 of the Constitution of India. The court noted these references but focused on the specific facts of the case at hand.

3. The court considered the maintainability of the writ petition against the cooperative society, emphasizing the discretionary power under Article 226 of the Constitution to grant directions for releasing the matured fixed deposit amounts. It cited a previous judgment that upheld the maintainability of such petitions against cooperative societies.

4. Addressing the legality of the cooperative society conducting banking business without an RBI license, the court found that since the society operated under the supervision of the Registrar of Co-operative Societies, a public law remedy was available to the petitioner.

5. The court resolved the dispute over the nature of amounts received under fixed deposit receipts by examining the terms and conditions of the deposits. It concluded that the amounts were indeed deposited as fixed deposits and not as loans, as contended by the first respondent.

6. Considering the facts and arguments presented, the court held in favor of the petitioner, directing the respondents to pay the amounts due under the matured fixed deposit receipts within a specified timeframe. The writ petition was disposed of accordingly.