Cooperative banks are categorized under the Banking Regulations Act, 1949, thereby requiring debt recovery through federal legislation and not state mechanisms.

JUDGMENT :

DHIRAJ SINGH THAKUR, CJ.

The present Writ Appeal has been preferred against judgment and order dated 09.07.2024 passed in writ petition No.5957 of 2024.

2. The learned single Judge has allowed the writ petition and held that the Registrar of Cooperative Societies had no jurisdiction to invoke its powers under the Andhra Pradesh Cooperative Societies Act, 1964 (hereinafter referred to as, "the Act of 1964") for recovery of debt due from the petitioner – respondent No.1 herein and that respondent No.5 in the writ petition that is the Krishna District Cooperative Central Bank Limited would have to resort to the procedure as prescribed under the Debt Recovery Tribunals Act, 1993 (hereinafter referred to as "the Act of 1993"). For arriving at the aforementioned conclusion, reliance was placed by the learned single Judge on a Constitution Bench judgment of the Apex Court, in the case of Pandurang Ganpati Chaugule vs. Vishwasrao Patil Murgud Sahakari Bank Limited , [ (2020) 9 SCC 215 ]

3. With a view to understand the issue in the backdrop of which the present controversy has risen, it is necessary to briefly state the material facts:

4. The petitioner, Dasari Venkata Srinivasa Rao, respondent No.1 herein availed a loan of Rs.25 Lakhs from the appellant Bank in the year 2019. Having committed a default in the payment of the instalments fixed, proceedings were initiated by the appellant Bank in terms of the provisions of the Act of 1964. Needless to say that the appellant is a Cooperative Society registered under the Andhra Pradesh Cooperative Societies Act, 1964 and is engaged in the business of banking. The banking business of the appellant - society is limited to its Members who may be advanced loans on such terms as are prescribed under law. The disputes between the Society and its Members in regard to any claim or debt, is governed by Chapter VIII and in particular Section 61, which envisages such a dispute to be referred to the Registrar for decision.

5. Chapter X of the Act of 1964 deals with execution of Decisions, Decrees and Orders passed by the authorities mentioned under the said Chapter. While sub-section (1) of Section 70 envisages the power of the Registrar or any person authorised by him to order a recovery of amounts as envisaged in the contingency in sub-clauses (a) to (f) of Section 70 (1), sub-section (2) of Section 70 envisages the mode and method of execution of the Decisions made under Sections 60, 71, 76, 77 and 78 through either a Civil Court having local jurisdiction on a certificate signed by the Registrar or any person authorised by him as if the order or decision were a decree of that Court, or by the Collector on an application made to him within prescribed time.

Sub-clause (c) of sub-section (2) of Section 70 also envisages recovery by the Registrar in the manner provided under sub-section (1). Further, Section 70(1) falling under Chapter X envisages as under:

"70. Power of the Registrar to recover certain amount by attachment and sale of property and execution of orders:

(1) The Registrar or any person authorised by him in this behalf may, without prejudice to any other mode of recovery provided by or under this Act, recover—

(a) any amount due under a decision or an order of the Registrar, or any person authorised by him, or an arbitrator;

(b) any amount ordered to be paid towards the expenses of a general meeting of a society called under Section 32;

(c) any amount awarded by way of costs under Section 56 to a society including a financing bank or a Federal society;

(d) any amount payable 1 [xxx] towards fees under Section 58;

(e) any amount ordered under Section 60 to be repaid to a society or recovered as a contribution to its assets ; or (f) any amount ordered under Section 66 to be recovered as a contribution to its assets, together with the interest, if any, due on such amount and the costs of process by the attachment and sale or by sale without attachment of the property of the person or the soci