BHARATI SAHKARI BANK LTD Vs. SOUTH INDIAN BANK LTD
LAWS(DR)-2004-9-15
DEBTS RECOVERY APPELLATE TRIBUNAL
Decided on September 28,2004

Appellant
VERSUS
Respondents

JUDGEMENT

Pratibha Upasani, - (1.) THIS Misc. Appeal is filed by the appellant/original defendant No. 3 Bharati Sahakri Bank Ltd. being aggrieved by the order dated 19.7.2004 passed by the learned Presiding Officer of Debts Recovery Tribunal, Pune on Exhibit No. 1 Original Application No. 238 of 2003. By the impugned order, the learned Presiding Officer rejected the application made by appellant Bank and held that the Debts Recovery Tribunal had jurisdiction to entertain and decide the claim against the appellant Bank. It is this order which is challenged by the appellant Bank by way of filing this appeal before the Appellate forum.
(2.) I have heard Mr. Khurjekar for the appellant Bank and Mr. Kaushik for the respondent No. 1 Bank. I have also gone through the proceedings and the relevant provisions of the law with respect to giving of a notice, before filing of the suit, under Section 115 of the Multi State Co-operative Societies Act, 2002, so also under Section 164 of the Maharashtra Co-operative Societies Act, 1960 and in my view, the learned Presiding Officer was not correct in coming to the conclusion that though there was no compliance of the provisions of Section 115 of the Multi State Co-operative Societies Act, 2002, still the Tribunal had jurisdiction to entertain and decide the claim against the appellant Bank. Few facts which are required to be stated are follows: The respondent No. 1 The South Indian Bank Ltd. had filed claim application before the Debts Recovery Tribunal, Pune being Original Application No. 238/2003 against the respondent No. 2 Rajendra Kumar Kalicharan Verma, the respondent No. 3 Ramdhar Suku Vishwakarma, so also the present appellant Bank namely Bharati Sahakari Bank Ltd., for recovery of Rs. 12,05,164/-. The said application was filed mainly against the respondent Nos. 2 and 3 to whom the respondent No. 1 Bank had financed loan of Rs. 10 lacs repayable in 180 equal monthly instalments of Rs. 12,000/ each. The said loan was granted for making balance payment of the purchase of a flat booked with a builder "M/s. Shraddha Associates", Promoters and Builders of Pune, a registered partnership. It was the contention of the respondent No. 1 Bank that it paid the loan amount of Rs. 10 lacs to the respondent No. 2 by a Bankers cheque bearing No. 620918 dated 7th August, 2002 drawn in favour of the builders M/s. Shraddha Associates. The said loan was secured by way of mortgage of the flat purchased by the respondent No. 2. Further case of the respondent No. 1 Bank was that it had got knowledge of the fact that the respondent No. 2 had tried to defraud the Punjab National Bank, Khadki, Pune and the respondent No. 2 was arrested. Therefore, the respondent No. 1 Bank made inquiries with the appellant Bank. The respondent No. 2 had deposited the Bankers cheque issued by the respondent No. 1 in an account opened, by the respondent No. 2 with the appellant Bank in the name of M/s. Shraddha Associates. It was the contention of the respondent No. 1 Bank before the Debts Recovery Tribunal that the appellant Bank acted negligently in allowing the respondent No. 2 to open an account with it and that because of the negligence and casual approach of the appellant Bank, the respondent No. 2 could fraudulently encash the Bankers cheque issued by the respondent No. 1 and, therefore, the appellant Bank was liable to refund the amount of the cheque together with interest. On this background, the respondent No. 1 Bank joined the appellant Bank as party defendant No. 3 in the claim application before the Debt Recovery Tribunal. The appellant Bank appeared in the matter as per the notice of the Tribunal and also filed the written statement. In the said written statement, the appellant Bank had raised issue of maintainability of the claim against it and had questioned jurisdiction of the Tribunal on the ground of non-compliance of the provisions of Section 115 of the Multi State Co-operative Societies Act, 2002 and or non-compliance of provisions of Section 164 of the Maharashtra Co-operative Societies Act, 1960. The appellant Bank also filed an application dated 20.2.2004 at Exhibit No. 11 raising the point of maintainability of the claim application and jurisdiction to be heard, as preliminary point. The respondent No. 1 Bank filed its reply and resisted the said application made by the appellant Bank. The learned Presiding Officer after hearing both the sides, rejected the application made by the appellant Bank holding that the original application was maintainable and the Debts Recovery Tribunal had jurisdiction to entertain and decide the claim against the present appellant Bank also. Being aggrieved, the present misc. appeal is filed by the appellant Bank.
(3.) MR. Khurjekar, the learned Advocate appearing for the appellant Bank, vehemently argued that the appellant Bank was governed by the Multi State Co-operative Societies Act, 2002 and therefore notice was required to be given to the Central Registrar before initiating the original application. MR. Khurjekar further argued that the notice dated 18.8.2003 given by the Advocate Sriniwasan & Co. for the respondent No. 1 Bank, which was addressed to the appellant Bank and the copy of which was given to the Commissioner for Co-operation and Registrar for Co-operative Societies, Maharashtra State and to the Divisional Joint Registrar of Cooperative Societies, could not be construed as compliance of the provisions of Section 115 of the the Multi State Co-operative Societies Act, 2002. MR. Khurjekar argued that what was contemplated by Section 115 of the Multi State Co-operative Societies Act, 2002, was that the notice had to be mandatorily given to the Central Registrar, stating the cause of action, the name, description and place of residence of the plaintiff and the relief which he claimed, and the plaint should contain a statement that such notice had been so delivered or left at the office of the Central Registrar. He drew my attention to the provisions of Section 115 of the Multi State Co-operative Societies Act, 2002, which can be reproduced below: "115. Notice necessary in suits.--No suit shall be instituted against a Multi State Co-operative Society or any of its officers in respect of any act touching the constitution, management of the business of the society until the expiration of ninety days next after notice in writing has been delivered to the Central Registrar or left at his office, stating the cause of action, the name, description and place of residence of the plaintiff and the relief which he claims and the plaint shall contain a statement that such notice has been so delivered or left.";


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