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2020 (5) TMI 148 - SC - Indian Laws


  1. 2018 (2) TMI 1326 - SC
  2. 2016 (12) TMI 1017 - SC
  3. 2017 (1) TMI 742 - SC
  4. 2015 (2) TMI 686 - SC
  5. 2011 (8) TMI 1086 - SC
  6. 2012 (11) TMI 205 - SC
  7. 2011 (1) TMI 1343 - SC
  8. 2010 (9) TMI 236 - SC
  9. 2010 (3) TMI 912 - SC
  10. 2009 (7) TMI 1302 - SC
  11. 2009 (2) TMI 451 - SC
  12. 2008 (3) TMI 662 - SC
  13. 2007 (4) TMI 679 - SC
  14. 2007 (3) TMI 726 - SC
  15. 2006 (9) TMI 179 - SC
  16. 2004 (3) TMI 758 - SC
  17. 2004 (1) TMI 71 - SC
  18. 2003 (11) TMI 335 - SC
  19. 2003 (10) TMI 388 - SC
  20. 2003 (2) TMI 482 - SC
  21. 2002 (10) TMI 777 - SC
  22. 2002 (9) TMI 798 - SC
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  24. 2002 (1) TMI 1285 - SC
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  26. 1999 (4) TMI 5 - SC
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  30. 1996 (3) TMI 525 - SC
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  32. 1993 (2) TMI 320 - SC
  33. 1989 (5) TMI 50 - SC
  34. 1988 (11) TMI 106 - SC
  35. 1986 (2) TMI 333 - SC
  36. 1985 (9) TMI 314 - SC
  37. 1985 (4) TMI 322 - SC
  38. 1985 (1) TMI 337 - SC
  39. 1983 (7) TMI 205 - SC
  40. 1981 (5) TMI 124 - SC
  41. 1980 (4) TMI 304 - SC
  42. 1979 (1) TMI 194 - SC
  43. 1977 (10) TMI 109 - SC
  44. 1977 (8) TMI 140 - SC
  45. 1975 (9) TMI 171 - SC
  46. 1975 (7) TMI 144 - SC
  47. 1974 (9) TMI 115 - SC
  48. 1974 (3) TMI 108 - SC
  49. 1971 (10) TMI 31 - SC
  50. 1970 (2) TMI 130 - SC
  51. 1969 (11) TMI 85 - SC
  52. 1969 (8) TMI 82 - SC
  53. 1964 (4) TMI 122 - SC
  54. 1963 (12) TMI 24 - SC
  55. 1963 (8) TMI 42 - SC
  56. 1962 (8) TMI 68 - SC
  57. 1962 (3) TMI 100 - SC
  58. 1962 (2) TMI 75 - SC
  59. 1961 (9) TMI 3 - SC
  60. 1960 (12) TMI 83 - SC
  61. 1960 (11) TMI 115 - SC
  62. 1959 (9) TMI 62 - SC
  63. 1958 (4) TMI 42 - SC
  64. 1958 (3) TMI 40 - SC
  65. 1956 (4) TMI 55 - SC
  66. 1954 (11) TMI 6 - SC
  67. 1954 (10) TMI 6 - SC
  68. 1953 (5) TMI 14 - SC
  69. 2007 (9) TMI 697 - HC
  70. 2002 (12) TMI 504 - HC
  71. 1970 (1) TMI 83 - HC
  72. 1960 (9) TMI 29 - HC
  73. 1957 (1) TMI 23 - HC
  74. 1947 (2) TMI 17 - HC
  75. 1931 (3) TMI 29 - HC
Issues Involved:
1. Legislative competence regarding the applicability of the SARFAESI Act to co-operative banks.
2. Definition of 'banking company' under the BR Act, 1949 and its applicability to co-operative banks.
3. Applicability of the SARFAESI Act to co-operative banks and the validity of related amendments and notifications.

Issue-Wise Detailed Analysis:

1. Legislative Competence Regarding the Applicability of the SARFAESI Act to Co-operative Banks:
The core question was whether co-operative banks fall under Entry 45 of List I (Union List) or Entry 32 of List II (State List) of the Seventh Schedule of the Constitution of India. The judgment clarified that co-operative banks, despite being co-operative societies, are governed by legislation related to Entry 45 of List I concerning 'banking'. The court emphasized that the term 'banking' has a broad meaning, encompassing various activities performed by co-operative banks, which include accepting deposits and granting loans. The court held that the Parliament has the legislative competence to enact laws regarding the recovery of dues by co-operative banks under Entry 45 of List I, as recovery is an essential function of banking.

2. Definition of 'Banking Company' Under the BR Act, 1949 and Its Applicability to Co-operative Banks:
The judgment examined whether the definition of 'banking company' under Section 5(c) of the BR Act, 1949 includes co-operative banks. The court observed that Section 56(a) of the BR Act, 1949, which was incorporated by Act No. 23 of 1965, explicitly states that references to 'banking company' should be construed as references to a co-operative bank. This incorporation by reference means that co-operative banks are included within the definition of 'banking company' for the purposes of the BR Act, 1949. The court reasoned that the legislative intent was to regulate co-operative banks under the same framework as other banking companies, thereby bringing them within the purview of the BR Act, 1949.

3. Applicability of the SARFAESI Act to Co-operative Banks and the Validity of Related Amendments and Notifications:
The court addressed whether co-operative banks are covered under the SARFAESI Act and whether the amendments and notifications related to them are valid. The judgment affirmed that co-operative banks are 'banks' under Section 2(1)(c) of the SARFAESI Act. The court held that the Parliament has the legislative competence to provide additional procedures for recovery under Section 13 of the SARFAESI Act, as recovery is an integral part of banking activity. The court upheld the validity of Section 2(1)(c)(iva) of the SARFAESI Act, which includes 'a multi-State co-operative bank', and the notification dated 28.1.2003 specifying co-operative banks as 'banks' for the purposes of the SARFAESI Act. The court reasoned that these provisions are within the legislative competence of the Parliament under Entry 45 of List I and do not encroach upon the State's domain under Entry 32 of List II.

Conclusion:
The judgment concluded that co-operative banks are governed by the BR Act, 1949, and the SARFAESI Act concerning their banking activities. The Parliament has the legislative competence to enact laws for the recovery of dues by co-operative banks, and the relevant amendments and notifications under the SARFAESI Act are valid. The court's interpretation ensures that co-operative banks are subject to the same regulatory framework as other banking institutions, thereby facilitating efficient recovery of dues and maintaining financial stability.

 

 

 

 

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