A corporate entity's loans cannot render individual office bearers personally liable unless taken in their personal capacity. Jurisdictional impropriety arises if proceedings are initiated against them for corporate debts.

ORDER :

A. Abhishek Reddy, J.

Heard the learned counsel for the parties.

2. This writ petition has been filed for the following relief(s):-

“That this petition is being filed for issuance of writ of appropriate nature order or direction setting aside order (without any specific date) contained in memo no. 1256 dated 27.09.2023 issued under the signature of Certificate Officer cum District Cooperative Officer Darbhanga disposing of petitioner’s objection under section 9 of the Bihar & Orissa Public Demands Recovery Act 1914; and directing him to deposit certificate amount within fortnight failing which warrant of arrest would be issued against him.

The petitioner also prays for quashing requisition and entire certificate proceeding no. 20/2017-18 which is being maintained against petitioner illegally without holding him liable for payment of any dues since Petitioner as Chairman had taken advance of Simra Nehalpur PACS and utilized its fund for purchase of Paddy which under instructions of respondent was handed over to the Miller for converting it in CMR and the Miller (respdt. No. 5) did not supply it for which he alone will be responsible; and in the case of similarly situate case of non- supply of CMR liability has been fixed on the Miller and other Millers have been put under arbitration vide orders passed.

The respondents have not passed order in accordance with the directions of the Hon’ble Court, in terms of order dated 01.11.2022 in CWJC 14562/2022 passed by this Hon’ble Court directed for passing reasoned order and without affording reasonable opportunity to defend and lead evidences in support of his claim denying liability. Even copy of the orders has not been supplied to the petitioner. Even on approach for its certified copy, was refused having no such provision for issuing certified copy. The petitioner is being kept under threat and apprehensive for coercive action against him for unjustified reasons.

The petitioner also prays for restraining respondents from taking any coercive steps against the petitioner, during pendency of this case.”

3. Learned counsel appearing on behalf of the petitioner has stated that the petitioner was working as a Chairman of the PACS which has taken a loan from the respondent bank. Thereafter, the petitioner has demitted the office. That the respondent bank has initiated certificate proceedings against the petitioner in his individual capacity stating that the loan taken by the PACS is liable to be repaid by the petitioner as he has taken the loan and signed all the papers on behalf of the PACS. Learned counsel has stated that though the petitioner has filed his objections to the certificate proceedings being initiated against him in his individual capacity, the authority without taking note of the legal position has passed the order which is impugned in the present writ petition. Learned counsel has stated that though the Certificate Officer has taken note of the fact that the loan which was taken by the petitioner was not in his individual capacity but as a chairman of the Simra Nehalpur PACS, the authority has passed the order directing the petitioner to pay the loan amount or else face arrest. Learned counsel has relied on the judgments of this Hon’ble Court reported in (Nawal Kishore Pd. Singh vs State of Bihar) 2006 (3) BLJ 676 and (Kanhaiya Lal v. State of Bihar) 2022(2) PLJR 553 in support of his case.

4. Per contra, the learned counsel appearing on behalf of the respondent Bank has vehemently opposed the present writ petition. Learned counsel has stated that though the petitioner has taken the loan in the capacity as a Chairman, he has misused his positio