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2016 Supreme(Ker) 479

IN THE HIGH COURT OF KERALA AT ERNAKULAM
SHAJI P.CHALY, J.
KADUKUTTY SERVICE CO-OPERATIVE BANK LIMITED - Petitioner
Vs.
STATE OF KERALA, REPRESENTED BY THE SECRETARY TO GOVERNMENT, CO-OPERATIVE DEPARTMENT & Ors. - Respondents
WP(C).No. 29362 of 2015 (U)
Decided On : 15-07-2016

Advocates Appeared:
For the Appellant : SRI. P.C.SASIDHARAN ADV.
For the Respondent: GOVERNMENT PLEADER SRI. G.GOPAKUMAR ADVS. SRI. V.G.ARUN, SRI. T.R.HARIKUMAR.

Headnote:

Co-operative Bank - Jurisdictional Dispute - Kerala Co-operative Societies Act, 1969 [Sec. 2(od), Sec. 2(taa), Sec. 7] - The court discussed the provisions of the Kerala Co-operative Societies Act, 1969, particularly Sec. 2(od) defining 'Primary Co-operative Society' and Sec. 2(taa) defining 'Urban Co-operative Society' and Sec. 7 dealing with registration of societies. The court concluded that the 4th respondent society had complied with all statutory requirements to open a new branch at Kadukutty Panchayat, and the petitioner failed to establish any illegality in the actions of the 2nd and 3rd respondents.

Fact of the Case:

The petitioner, a Co-operative Bank, sought to prevent the 4th respondent from opening a branch at Kadukutty Panchayat, claiming it was beyond the 4th respondent's area of operation. The petitioner argued that the 4th respondent's actions were illegal and would cause unhealthy competition.

Finding of the Court:

The court found that the 4th respondent had complied with all statutory requirements to open the new branch and that the petitioner had failed to establish any illegality in the actions of the 2nd and 3rd respondents. The court dismissed the writ petition.

Issues: The primary issue was whether there was a violation of statutory provisions in the approval of the 4th respondent's bye-laws and the opening of a branch at Kadukutty Panchayat. The court also considered the petitioner's locus standi to challenge the 4th respondent's actions.

Ratio Decidendi: The court held that the 4th respondent had not violated any statutory provisions and had the right to open the new branch. The court also found that the petitioner did not have the right to challenge the 4th respondent's actions.

Final Decision: The writ petition was dismissed, and the court found in favor of the 4th respondent, allowing them to proceed with opening the new branch at Kadukutty Panchayat.

JUDGMENT :

This writ petition is filed by the petitioner, Co-operative Bank, seeking direction to the respondents not to permit the 4th respondent to commence its branch at Kadukutty beyond its area of operation and in the area of operation of the petitioner Bank and further to declare that since the area of operation of the 4th respondent Society is within Chalakudy Municipality alone, any attempt to open a branch beyond its area of operation is highly unjust and illegal, and for other related reliefs. Material facts for the disposal of the writ petition are as follows:

2. Petitioner is a Primary Credit Co-operative Society registered under the provisions of the Kerala Co-operative Societies Act, 1969 [for short, 'the Act'] and Kerala Co- operative Societies Rules, 1969 [for short, 'the Rules'] framed there under. Petitioner Society is established in the year 1947 and the area of operation of the society extends to the entire Kallur Vadakkumuri village which comprises the entire Kadukutty Grama Panchayat. The 4th respondent is an Urban Co-operative Society as defined under Sec. 2 (taa) and its area of operation is in the Chalakudy Municipality. That Sec.2 of the Act defines various types of Co-operative Societies and in terms of the same, petitioner Society falls under the category of Sec. 2(od).

3. That apart, it is contended that, in terms of Rule 15 of the Rules, Societies are classified according to its type and the classifications are so made according to the principal objectives as provided in the bye-law of the society. Grievance raised in this writ petition is that the 4th respondent society is now proposing to extend its business to Kadukutty Panchayat and there is a proposal to commence a new Branch at Kadukutty town and that too, adjacent to the building where the petitioner society is housed and the 4th respondent has issued a public notice accordingly, evident from Ext.P1. That apart, 4th respondent has put up a board at Building No.3/340 (a), (b), (c) and (d) advertising the inauguration of the branch at Kadukutty, evident from Ext.P2. It is also contended that, 4th respondent has preferred an application before the 3rd respondent seeking permission to open the branch at Kadukutty and it is the contention of the petitioner that, opening of such a branch is illegal, since the 4th respondent being an Urban Co-operative Society and its area of operation is Chalakkudy Municipality alone, it cannot operate its business beyond the area of operation. Further, in terms of Sec. 7(c) of the Act, registration is granted to a society, if the Registrar is satisfied that the proposed society complies with the requirement of sound business and only under that circumstances the bye-law of such society can be registered. The bye-law of the 4th respondent society has so far not been amended to expand the business beyond its present area of operation and such amendment cannot be allowed since it will change the character of the 4th respondent society. That the operation of the 4th respondent society will also hamper the interest of the petitioner society. Petitioner has submitted Ext.P4 representation before the 2nd respondent with copy to the 3rd respondent, objecting to the proposal to open up a new branch by the 4th respondent. That apart, it is contended that, the area of operation is fixed for each society so as to avoid overlapping in the functioning of the societies and also to avoid unhealthy competition among societies. Petitioner apprehends that the 4th respondent has sufficient political clout to secure permission to open up the branch in question.

4. Against these background facts, 4th respondent has filed a counter affidavit contending that the 4th respondent has amended its bye-laws which was approved by the Registrar of Co-operative Societies, extending its area of operation to Kadukutty Panchayat also since the area falls within the Chalakudy Assembly constituency. Thereupon, petitioner has amended the writ petition ch

























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