Bombay High Court
Suresh Anandraj Tatiya vs Jalgaon Jilha Madhyavarti Sahakari … on 12 March, 2025
2025:BHC-AUG:7243
(1) wp13219.19
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD
WRIT PETITION NO.13219 OF 2019
WITH
CA/13905/2023 & CA/14914/2023 & CA/1020/2024
1. Manish Ishwarlal Jain ...PETITIONERS
Age-Major, Occu-Business,
R/o. Rajmal Lakhichand Jewelers,
Sarafa Bazar, Jalgaon
Tq. & Dist. Jalgaon
2. Surendra Nathmalji Lunkad,
Age-72 years, Occu-Business,
R/o. Lunkad Towers, Zilla Peth,
Jalgaon, Tq. & Dist. Jalgaon
3. Subhash Sagarmalji Sankhala
Age-Major, Occu-Business,
R/o. 33/5, Sankhala Building,
Zilla Peth, Jalgaon
Tq. & Dist. Jalgaon
4. Ajeet Bansilalji Kacheriya,
Age-Major, Occu-Business,
R/o. 56, Aadarsh Nagar, Zilla Peth,
Jalgaon, Tq. & Dist. Jalgaon
5. Suresh Bansilalji Jain,
Age-Major, Occu-Business,
R/o. 16, Polan Peth, Jalgaon,
Tq. & Dist. Jalgaon
6. Tulshiram Khandu Bari,
Age-Major, Occu-Business,
R/o.71, Dixit Wadi, Zilla Peth,
Jalgaon, Tq. & Dist. Jalgaon
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7. Sau. Sapna Ashwin Shah,
Age-Major, Occu-Business,
R/o. Sharma Complex, Ganpati Nagar,
Jalgaon, Tq. & Dist. Jalgaon
8. Sau. Aapna Ajay Raka,
Age-Major, Occu-Business,
R/o. Anusmruti Jainagar, Zilla Peth,
Jalgaon, Tq. & Dist. Jalgaon
9. Mahendra Durlabhji Shaha,
Age-Major, Occu-Business,
R/o. 115, Zilla Peth, Jalgaon
VERSUS
1. Jalgaon Zilla Madhyavarti Sahakari ...RESPONDENTS
Bank Limiated, Jalgaon, 27
Ring Road, Jalgaon
Dist. Jalgaon through its Manager
2. Mahaveer Urban Cooperative
Credit Society Ltd Jalgaon
Navi Peth, Vardhaman Chambers
Jalgaon, Dist. Jalgaon, Through its Administrator
3. Suresh Anandraj Tatiya
Age-Major, Occu-Business,
R/o. 94, Navi Peth, Jalgaon,
Dist. Jalgaon
Mr. V. D. Hon, Senior Advocate i/b Mr. A. D. Shinde, Advocate
for the petitioners
Mr. V. D. Salunke, Advocate for the respondent No.1
Mr. C. V. Borse, Advocate h/f Mr. V. B. Patil, Advocate for
respondent No.3
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AND
WRIT PETITION NO.5117 OF 2020
Suresh Anandraj Tatiya, ...PETITIONERS
Age-Major, Occu-Business
R/o. 94, Navi Peth, Jalgaon
Dist. Jalgaon
VERSUS
1. Jalgaon Jilha Madhyavarti ...RESPONDENTS
Sahakari Bank Ltd. Jalgaon
Dist. Jalgaon
2. Mahavir Urban Cooperative Credit
Society Ltd. Jalgaon, Navi Peth,
Vardhaman Chamber,
Dist. Jalgaon
3. Manish Ishwarlal Jain,
Age-Major, Occu-Business,
R/o. Rajmal Lakhichand Jewellers,
Saraf Bazar, Jalgaon, Tq. & Dist. Jalgaon
4. Surendra Nathmalji Lunkad,
Age-72 years, Occu-Business,
R/o. Lunkad Towers, Zilla Peth,
Jalgaon, Tq. & Dist. Jalgaon
5. Subhash Sagarmalji Sankhala
Age-Major, Occu-Business,
R/o. 33/5, Sankhala Building,
Zilla Peth, Jalgaon
Tq. & Dist. Jalgaon
6. Mahendra Durlabhji Shaha,
Age-Major, Occu-Business,
R/o. 115, Zilla Peth, Jalgaon
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7. Ajeet Bansilalji Kacheriya,
Age-Major, Occu-Business,
R/o. 56, Aadarsh Nagar, Zilla Peth,
Jalgaon, Tq. & Dist. Jalgaon
8. Suresh Bansilalji Jain,
Age-Major, Occu-Business,
R/o. 16, Polan Peth, Jalgaon,
Tq. & Dist. Jalgaon
9. Tulshiram Khandu Bari,
Age-Major, Occu-Business,
R/o.71, Dixit Wadi, Zilla Peth,
Jalgaon, Tq. & Dist. Jalgaon
10. Sau. Sapna Ashwin Shah,
Age-Major, Occu-Business,
R/o. Sharma Complex, Ganpati Nagar,
Jalgaon, Tq. & Dist. Jalgaon
11. Sau. Aapna Ajay Raka,
Age-Major, Occu-Business,
R/o. Anusmruti Jainagar, Zilla Peth,
Jalgaon, Tq. & Dist. Jalgaon
Mr. A. P. Bhandari, Advocate for the petitioners
Mr. V. D. Salunke, Advocate for the respondent No.1
CORAM : KISHORE C. SANT, J.
RESERVED ON : 27th FEBRUARY, 2025
PRONOUNCED ON : 11th MARCH, 2025
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JUDGMENT :
1. Rule. Rule made returnable forthwith by consent of
the parties.
2. The petitioners before this court are the persons
who executed security bonds for the loan advanced to
respondent No.2 Society by respondent No.1 bank. Respondent
No.1 is the District Central Cooperative Bank. Respondent No.2
is the Society under the Cooperative Societies Act. Respondent
No.3 is also one of the guarantors who has filed writ petition
No.5117/2020. The present petitioners are respondent No.3 to
11 in the writ petition No.5117/2020 filed by the respondent
No.3. Since both the petitions are filed challenging the same
judgment and order passed by the learned Cooperative appellate
court. [Respondent No.1 hereinafter referred to as ‘Bank’ and
Respondent No.2 hereinafter referred to as the ‘Society’ for the
purpose of convenience.]
3. The petitioners are aggrieved by the judgment and
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order dated 24-09-2021 passed in Appeal No. 42/2019 and
Appeal No. 53/2019. The appeal No. 42/2019 was filed by the
petitioners in WP/13219/2019 whereas the appeal No. 53/2019
was filed by petitioner in WP/5117/2020.
4. The facts giving rise to the present petitions are as
below:
5. That the petitioners executed the Guarantee bonds
(Hamipatra) for loan sanctioned to respondent No.2-
Cooperative Credit Society. The loan was obtained as term loan.
Respondent No.1 sanctioned the loan and took Guarantee bonds
from the petitioners. Said bonds were executed on different
dates. As the society did not repay the loan, the bank filed
original application before the Debt Recovery Tribunal only
against the society on 20-12-2004. After prosecuting for some
time, the bank withdrew the proceedings of original application
on 26-02-2008 finding that original application is not
maintainable in respect of the Cooperative Bank before the DRT.
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6. After withdrawing the original application the bank
filed dispute before the Cooperative Court, Jalgaon bearing
dispute No. 249/2010 for recovery of loan amount of
Rs.17,58,03,383/-. This dispute was filed only against the
society. It is thereafter, the bank filed an amendment application
Exh.9 and sought permission to add petitioners as party
opponents. The relief also came to be claimed against the
petitioners on the strength of Guarantee bonds. Though the
application was opposed on various grounds, mainly, that the
amendment is time barred, the learned Cooperative Court,
Jalgaon allowed the amendment application by order dated 31-
10-2013.
7. The petitioners challenged the order of amendment
by filing revision. The Cooperative Appellate Court dismissed
the revision observing that the court at that stage need not go
into the merits of the matter. The petitioners thereafter filed writ
petition No.7304/2014 before this court. This court confirmed
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the orders by keeping the point of limitation open by its order
dated 01-09-2014. The petitioners filed an application Exh.15 in
the Cooperative Court praying for framing point of limitation as
preliminary issue and to decide the same before proceeding on
merits. This application was on the ground that even if the
Guarantee bonds are taken as it is, the period of limitation
claiming recovery on the basis of said Guarantee bonds would
be only three years whereas petitioners are added as party for
the first time in 2012. The said point was framed as preliminary
point. The bank challenged this order by filing revision
No.19/2017. On dismissal by the appellate court, a writ petition
was filed bearing No. 11081/2017. This court disposed off the
writ petition directing the lower court to decide all the issues
together. The trial court, therefore, proceeded to decide all the
issues together.
8. After holding trial, the learned Cooperative Court
allowed the dispute holding the petitioners and respondent No.2
jointly and severally liable to pay the amount. The petitioners,
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therefore filed the appeals in the appellate court. The appellate
court dismissed the appeals and thus the petitioners are before
this court.
9. Mr. Hon, learned senior advocate i/b Mr. A. B.
Shinde vehemently argued that both the courts below have
clearly erred in holding the claim against the petitioners within
limitation. The learned courts failed to appreciate the provisions
of section 92 (2) of the Maharashtra Cooperative Societies Act,
1960 [Hereinafter referred to as the ‘Societies Act‘]. The dispute
was not maintainable against the petitioners under section 91 as
the petitioners are not the members of the bank. Though the
Guarantee bonds were executed for term loan, said loan was
converted into cash credit facility without consent of the
petitioners. This change amounts to variance in the terms of
contract and thus the petitioners were not liable to any action
for recovery. When all the issues were raised it was necessary for
the Cooperative Appellate Court to remand the matter back to
the Cooperative Court for decision afresh on all the issues. The
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learned appellate court failed to do so. It was necessary to frame
all the material points in view of provision of order 41 Rule 31
of the CPC. When the bank itself had approached the DRT it had
chosen not to add the petitioners as party. Even after withdrawal
when the dispute was filed, these petitioners were not shown as
opponents in the dispute which clearly shows that even the bank
was aware that dispute was not maintainable against the present
petitioners. He took this court through the provisions of section
91 (b) and (d), Section 92(2), Article 36 and 37 of the
Limitation Act. This court while disposing of the petitions had
specifically directed the trial court to consider all the issues.
However, in spite of specific directions both the courts have
failed to even discuss these points. He submits that findings on
all the issues was necessary. He relied upon the following
judgments :
ii] Malluru Mallappa (D) Thr. Lrs. Vs
Kuruvathappa and others2 ;
1 2022(3)SCC 90
2 2020(4) SCC 313
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iii] Barnes School and others Vs Arzoo Allan Baker
reported 3;
iv] Malegaon Taluka Big Bagayatdar Cooperative
Credit Association Vs The Bharat Cooperative Joint
Farming Society Ltd and others4 ;
10. Mr. Bhandari, learned advocate for the petitioner in
WP/5117/2020 adopted the arguments of Mr. Hon, learned
senior counsel. He drew attention of this court to the provision
of the Limitation Act. There is nothing in the order passed in the
earlier writ petition to show that amendment relates back to the
dates of institution of the dispute. He submits that thus the
dispute should be taken to have been instituted against the
petitioner, on the date, on which he was added as opponent.
Since the proceedings before the DRT was not before the court
of competent jurisdiction, the time spent before the DRT need
not be excluded in view of section 14 of the Limitation Act. He
submits that the court is not defined in the Cooperative Societies
Act and therefore it will have to be taken as court as defined in
General Clauses Act. He submits that in any case certified copy
3 2012(3) All MR
4 1999(4) Bom CR 438
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of the judgment and order passed by the DRT received on 17-01-
2008 and still dispute was filed in 2010 that period also needs to
be excluded. It is only the period for which the proceeding was
actually pending before the court that can be excluded. He also
argued on section 91 and 92 of the Act and submits that it is the
limitation under the Limitation Act that would be applicable in
the present case as liability of the petitioner is on the basis of
guarantee bonds.
11. In response, the learned advocate Mr. Salunke
submits, on the point of limitation, that the proceeding and
dispute was under the special Act and before the special court. It
is, therefore, provisions of the Special Act that would prevail
upon the General Act. The petitioners were office bearers of the
society and in that capacity they were added as opponents.
Reading section 91 as it is, he submits the dispute was very
much maintainable against the petitioners. The Guarantee
bonds (Hamipatra) are duly proved and there is no dispute and
no arguments are advanced on that. Even the limitation act is
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not applicable when there is specific limitation provided under
section 92 of the Act. The liability of this petitioners is equal to
that of the society. In view of section 73 of the Act the
petitioners happen to be nominal members of the society. The
petitioners cannot avoid the liability as they had executed the
bonds while sanctioning the loan these petitioners were
accepted as nominal members of the bank. . He specifically
contends that all the points were framed by the appellate court.
The proceeding is thus clearly maintainable in view of section
91. He submits that it was never a case before the trial court,
only point of limitation was kept open. The petitioners,
therefore, cannot argue other points. Guarantee bonds are
exhibited and proved.
12. Mr. Salunke, learned advocate relies upon the
following judgments:
i] State of Maharashtra Vs Laljit Rajshi Shah5
ii] Thakur Sukhpal Singh Vs Thakur Kalyan Singh6
5 2000 AIR (SC) 937
6 1963 AIR (SC) 146
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iii] Khandesh Urban Coop. Credit S Vs Ashok Rameshwar
Agrawal7
vi] Mah. State Warehousing Corporation and others Vs Pusad
Urban Cooperative Bank Ltd. and others8
13. After hearing the parties this court has to consider
the material as to whether dispute was maintainable against the
petitioners and secondly whether relief against them is hit by the
limitation. The dispute was filed under Section 91 of the
Cooperative Societies Act which reads as under:-
91. Notwithstanding [anything contained] [These
words were substituted for the words ‘anything
containing’ by Maharashtra 33 of 1963, Section
20(a).] in any other law for the time being in force,
any dispute touching the constitution, [elections of
the committee or its officers [* * *] [These words
were substituted for the words ‘elections of the office
bearers’ by Maharashtra 20 of 1986. Section 48(a).]
conduct of general meetings, management or
business of a society shall be referred by any of the
parties to the dispute, or by a federal society to
which the society is affiliated or by a creditor of the
society, [to the co-operative Court] [These words
were substituted for the words ‘to the Registrar’ by
Maharashtra 18 of 1982, Section 3(a).] if both the
parties thereto are one or other of the following:-
7 2002 (4) ALL MR 91
8 2022 (07) BOM CK 0020
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(a) a society, its committee, any past committee,
any past or present officer, any past or present agent,
any past or present servant or nominee, heir or legal
representative of any deceased officer, deceased
agent or deceased servant of the society, or the
Liquidator of the society [or the official Assignee of a
deregistered society] [These words were inserted by
Maharashtra 10 of 1988, Section 17(a)(i).].
(b)a member, past member of a person claiming
through a member, past member of a deceased
member of society, or a society which is a member of
the society [or a person who claims to be a member
of the society;] [These words were added by
Maharashtra 27 of 1969, Section 16(a)(i).]
(c) a person other than a member of the society,
with whom the society, has any transactions in
respect of which any restrictions or regulations have
been imposed, made or prescribed under sections
43, 44 or 45, and any person claiming through such
person; [Clauses (c) and (d) were, substituted for
the original by Maharashtra 27 of 1969, Section
16(a)(j).]
(d) a surety of a member, past member or deceased
member, or surety of a person other than a member
with whom the society has any transactions in
respect of which restrictions have been prescribed
under section 45, whether such surety or person is
or is not a member of the society;
(e)any other society, or the Liquidator of such a
society [or-de-registered society or the official
Assignee of such a de-registered society] [These
words were inserted by Maharashtra 10 of 1988,
Section 17(a)(ii).].
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[Provided that, an industrial dispute as defined in
clause (k) of section 2 of the Industrial Disputes Act,
1947, or rejection of nomination paper at the
election to a committee of any society [* * *] [The
proviso was added by Maharashtra 20 of 1986,
Section 48(b).], or refusal of admission to
membership by a society to any person qualified
therefor [or any proceeding for the recovery of the
amount as arrear of land revenue on a certificate
granted by the Registrar under sub-section (1) or (2)
of section 101 or sub-section (1) of section 137 or
the recovery proceeding of the Registrar or any
officer subordinate to him or an officer of society
notified by the State Government, who is
empowered by the Registrar under sub-section (1) of
section 156,] [This portion was inserted by
Maharashtra 10 of 1988, Section 17(a)(iii).] [or any
orders, decisions, awards and actions of the
Registrar against which an appeal under section 152
or 152A and revision under section 154 of the Act
have been provided.] [These words figures and
letter were inserted by Maharashtra 34 of 2001,
(w.e.f. 7-9-2001) Section 8.] shall not be deemed to
be a dispute for the purposes of this section.]
14. In the case of Manjula and Malluru (supra) the
Hon’ble Apex court considered the provision of order 41 Rule 31
of CPC which requires the appellate court to frame specific
points on which the court has to decide the appeal. It is held
that first appeal is a valuable right of the party. The appeal is
continuation of original proceedings. The appellate court
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decides all the question of fact and law and therefore, it is
necessary to reflect conscious application of mind and therefore
appellate court must record the findings, supported by the
reasons on all the issues. It is thus held that the appellate court
has to comply with the requirements of the Order 41 Rule 31 of
CPC. Non-observance thereto lead to infirmity in judgment. In
that case, the High Court did not comply with the said
requirements and therefore the matter was remanded back to
the High Court. In the present case this court finds that point of
limitation was framed by the appellate court. There is sufficient
discussion on all the points. No prejudice is shown to have been
caused to the petitioners. Said judgment is therefore, would not
be applicable in the present fact. In the case of Barnes School
and others Vs Arzoo Allan Baker this court held that there is
obligation on the appellate court to frame all the points in view
of order 41 Rule 31.
15. So far as the judgment in the case of Khandesh
Urban Coop. Credit S (supra) same is relied by both the parties.
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Mr. Salunke, learned advocate relies on para No. 11 to submit
that dispute before the court was in summary in nature. Para
No. 25 to 28 of the judgment in the case of Maharashtra State
Warehousing Corporation and others VS Pusad Urban
Cooperative Bank Ltd 9 relies by Mr. Salunke, while considering
the provision of section 91 has clearly held that the guarantor
from the members also falls under section 91 of the Cooperative
Societies Act. In view of section 91(1)(d) thus both the courts
have rightly held that the petitioners are necessary party.
16. In the case of State of Maharashtra Vs Laljit Rajshi
Shah the Hon’ble Apex court has considered the question as to
whether the Chairman of the Cooperative Society can be said to
be a public servant under Section 21 of the Indian Penal Code.
Considering that effect of section 61 of the Societies Act, it is
held that merely because of section 21 of the IPC is referred in
Section 161 of the Act would not make him a public servant
under Section 21 of the IPC. Public servant is only for the
purpose of Cooperative Societies Act. It is held that by that
9 2002 (4) ALL MR 91
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persons cannot be prosecuted for the offence under IPC. The act
is held to be completely self contents statutes with its own
provisions. The Statutes have different object. For the offence
under the Cooperative Societies Act only persons is to be
considered a public servant referred to definition under section
21 of the IPC. There is no dispute about the same. Therefore,
this court holds that the petitioners were rightly added as party
and secondly the limitation applicable would be as under section
92 of the Cooperative Societies Act and not as provided under
the Limitation Act.
17. In the case of Thakur Sukhpal Singh Vs Thakur
Kalyan Singh (supra) the Hon’ble Apex Court considered the
order 41 Rule 31 and other Rules. It is held that the provision of
Rule 31 should be reasonably construed and should be held to
be required various particular to be mentioned in the judgments.
It is only when specific questions are raised in the appeal,
ultimately, it is held what is material is that all the questions are
considered by the appellate court. In the case of Khandesh
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(Supra) it is held that not the entire CPC is applicable to the
proceedings of the Cooperative Court. However, it is only
general principles contents in CPC are broadly applicable to the
cooperative court. The Cooperative Courts are expected to
follow broadly principles laiddown in the CPC. It is held that the
Cooperative Court may not be bound by every technical rule of
procedure. Thus, it is clear that where the principle of natural
justice and broad principles contents in the CPC are considered
by the Cooperative Court i.e. sufficient. As it is the Cooperative
Appellate Court has considered all the points, even otherwise.
18. In the case of Mah. State Warehousing Corporation
and others Vs Pusad Urban Cooperative Bank Ltd and others the
petitioner is held to be surety of the members creating liability
in favour of the respondent bank in that case. In this case fact of
executing surety bonds is not guarantee bonds is not at all
disputed. On the contrary the parties have no dispute about the
factual aspect. The petitions are argued only on the point of
limitation and as to whether the limitation as regards the
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present petitioners.
19. In the case of Malegaon Taluka Big Bagayatdar
Cooperative Credit Association (supra) the facts were that a
society filed a suit against another society for recovery of the
amount. The opponent society was not member of the disputant
society. In that view it was held that the sub-section (1)(a) of
Section 92 would not apply and case would be covered by
subsection (2) of section 92 where the limitation is three years
as provided in the Limitation Act. In that view it was held that
dispute was barred by the limitation as it was filed beyond three
years from the expiry of accounting year 1968-1969 and the
dispute was filed in 1975. In that view of the matter it was held
to be bared by limitation. Present is the case this court holds
that it was governed by section 92 (1) as the petitioners happens
to be nominal members of the society, in any case they are
governed by section 91 against whom dispute was maintainable.
20. Clauses (a) & (b) of Section 91 would show that
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even the members of the society or surety are amenable to the
jurisdiction of the Cooperative court in a dispute. The petitioners
clearly fall in Section 91(1)(a) being nominal members of the
society. In view of section 91(1)(d) the petitioners are sureties
and thus they are amenable to the jurisdiction under Section 91.
For the purpose of limitation both the parties have referred
section 92. Section 92 (1) gives special limitation. Provision of
limitation Act are applicable only in the cases falling in clause
(2) of section 92. Provides limitation of 6 years from the date on
which act or omission with reference to the dispute arose same
limitation is also applicable in respect of the matters falling
under clause (c) of section 1 of Section 92. Though it is argued
by the learned senior counsel that there is no sufficient
discussion by both the courts below, this court on going through,
the judgment as shown by the learned Advocate Mr. Salunke
finds that specific issue was framed by the learned Cooperative
Court. Issue No. 3 is specifically framed in respect of the
limitation. It was held that the petitioners failed to show that
dispute is barred by limitation. Issue as to whether they are
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liable to pay the amount is also answered in affirmative.
20. So far as the submission that this court had
specifically directed the court to decide the issue of limitation in
the WP/7304/2014. There is no dispute, however, it is clearly
seen that court had directed to decide the issue of limitation. So
far as other aspects as to whether the petitioners are necessary
party or not this court has not kept it open.
22. This court thus finds that the petitioners were rightly
added as party in view of section 91(1)(d). The limitation that
would be applicable under section 92(1) as rightly held by the
courts below. There is no manner of issue that both the courts
have rightly appreciated this legal position.
23. On going through the judgment it is found that the
courts have considered section 91 (b) of the Act. It is rightly
pointed out that the appellate court has also considered and it is
specifically observed that the contest is only on the legal point.
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There is no challenge so far as factual aspects are concerned.
Appellate court has considered the point of limitation by
considering the provision of Section 92 of the Act. The court
specifically dealt with the submission of the petitioners that
there cannot be two starting point of limitation against the
borrowers and one against the sureties. This court, thus, finds
that there is no illegality or perversity in the orders passed by
the learned appellate court. This court does not find any reason
calling for interference at the hands of this court and in the
impugned judgment and order.
24. The writ petitions stand dismissed and disposed off.
25. In view of the disposal of the writ petitions, pending
civil applications stand disposed off.
[KISHORE C. SANT, J.]
VishalK/wp13219.19
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