JUDGEMENT :

1. RULE. Rule made returnable forthwith. Heard finally by consent of parties. For convenience, Writ Petition No. 1602/2017 is treated as the lead petition for delivering this judgment. Accordingly, the description of facts and submissions in the following judgment corresponds to this petition. Though broadly speaking, facts in all three petitions are similar except amounts mentioned in the dispute. Hence all three Writ Petitions are disposed of by common judgment.

2. By these Petitions under Articles 226 & 227 of the Constitution of India, the Petitioners are challenging the judgment and order passed by the Member, Maharashtra State Co-operative Appellate Court, Mumbai, Bench at Nagpur in Appeal filed by them holding the Petitioners liable for payment of the amount of loan in capacity of surety of a member.

3. A brief recapitulation of facts would bring the matter into proper perspective for better appreciation of the issues involved:-

Respondent No. 1 – Bank filed a dispute under Section 91 of the Maharashtra Co-operative Societies Act (hereinafter referred to as "the said Act") for recovery of the amount against Respondent Nos. 2 to 4. Respondent No. 1 granted a loan to Respondent No. 2, for which Respondent Nos. 3 and 4 were the Guarantors. According to Respondent No. 1, Respondent No.2 stored the goods in the warehouse of the Petitioners. Petitioner No. 1 issued a receipt accepting the lien/charge of Respondent No.1 Bank over the said goods. Respondent No.1 disbursed the loan on the basis of the receipt issued by Petitioner No. 1. It is contended that on 15/01/2007, the news was published in the Dainik Lokmat stating that Manager of the Petitioner No. 1 committed a large scam. Therefore, the Manager of Respondent No.1 – Bank called upon Petitioner No. 1 about the information of the receipts pledged with Respondent No.1 – Bank. Inspite of several reminders issued by the Bank, there was no response from Petitioner No. 1. It was communicated to the Bank that the Manager of the Petitioner No. 1 had committed fraud and misappropriated the amount. Therefore the First Information Report came to be lodged with Police Station Pusad. It was informed that no stock or goods were lying with the warehouse under receipts mentioned at Serial Nos. 1 to 8 pertaining to Respondent No. 2 – Borrower. It is therefore contended that the Petitioners are liable for the acts, commission and omission done by their servants and therefore liable to make good the loss caused to the Bank. It is averred that the Petitioners are joined as necessary parties and proper parties to the dispute. Therefore the Co-operative Court has jurisdiction to decide the same against the Petitioners.

4. Respondent No. 2 – Borrower resisted the dispute by filing a written statement. He denied the entire claim of Respondent No.1 – Bank and prayed for dismissal of the dispute. The Respondent Nos. 3 and 4 appeared in the said dispute but failed to file the written statement, and therefore the dispute proceeded ex-parte against them.

5. The Petitioners contested the dispute by filing a written statement. According to them, the dispute under Section 91 of the said Act is not maintainable against them as they are not the Members. In Paragraph 3 of the written statement, the Petitioners raised the defence that Respondent No.1 – Bank has not pleaded or stated how the Petitioners can be made parties under Section 91 and how they are liable for the amount prayed in the dispute. In the absence of statutory pleadings against the Petitioners, the dispute against them is not maintainable and therefore is liable to be dismissed. According to them, the goods as contended by the Bank were not deposited with the Petitioners, and only fraudulent warehouse receipts obtained from the then Manager were deposited with Respondent No.1 – Bank. According to them, on the basis of such fraudulent receipts, the Petitioners are not liable. At the most, the then Manager is personally liable. They d