Revision challenging consequential actions to recovery certificate under MCS Act requires 50% dues deposit; purposive interpretation curbs delays, overrides literal reading defeating recovery object.

JUDGMENT :

M. S. KARNIK, J.

1. These writ petitions have been placed before us to answer a reference made by learned Single Judge of this Court (Hon’ble R. V. More, J. as he then was) in Writ Petition No. 4118 of 2024, by order dated 28th April 2014. The reference arose upon the learned Single Judge noticing an irreconcilable conflict between the views expressed in the judgments of co- ordinate Benches of this Court viz. Order dated 3^rd October, 2003 in Greater Bombay Co-operative Bank Ltd. v. Dhillon P. Shah , 12004 (1) Mh.L.J. 996, (Hon’ble A. M. Khanwilkar, J. as he then was) and Order dated 16^th March, 2005 in Pravin Yashwant Dhanawade v. Jawali Sahakari Bank Ltd. , Writ Petition No. 810 of 2005 (Hon’ble B. H. Marlapalle, J. as he then was).

2. The issue framed for reference is as follows:

“Whether a litigant, who challenges an action consequential to the issuance of a certificate under Section 101 of the Maharashtra Co- operative Societies Act, 1960 in a revision under Section 154, and not the recovery certificate itself, is required to deposit an amount equivalent to 50% of the dues recoverable under the recovery certificate or not?”

3. The learned Single Judge was of the opinion that there are conflicting decisions in respect of deposit of 50% of the recoverable dues under the Recovery Certificate for entertaining a Revision Application against an Order challenging a derivative action pursuant to the grant of Recovery Certificate as contemplated under Section 101 of the Maharashtra Cooperative Societies Act, 1960 (“MCS Act”, for short).

4. Before we proceed, it would be useful to set out some background facts. The Petitioner, along with Respondent No. 10, stood as guarantor for a loan advanced by Respondent No. 1–Bank to Respondent No. 9. Upon default, the Bank initiated recovery proceedings under Section 101 of the MCS Act. A recovery certificate dated 24th September 2013 was issued against Respondent No. 9 and the Petitioner. The Petitioner expressly did not challenge the validity or legality of the recovery certificate, either before the Divisional Joint Registrar or before this Court. Pursuant to the issuance of the recovery certificate, the Recovery Officer issued a notice of attachment of the Petitioner’s property on 3rd October 2013 under Rule 107 of the Maharashtra Co-operative Societies Rules, 1961 (“the MCS Rules” for short).

5. Thereafter, the Petitioner filed a revision under Section 154 of the MCS Act, confining his challenge solely to the notice of attachment. The recovery certificate itself was not challenged. The Revision was rejected on 14^th February 2014 on the ground that the Petitioner had failed to deposit 50% of the recoverable dues, as mandated under Section 154(2A) of the MCS Act. This order of rejection was challenged before a learned Single Judge of this Court by filing Writ Petition No. 4118 of 2014 ( Govindrao Shankarrao Gaikwad v. The Ganesh Co-operative Bank and Others ). Noticing the conflict between the views expressed by the co-ordinate Benches, the learned Single Judge referred the matter to a larger Bench for determination of the issue quoted above.

6. For properly appreciating the contro