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2025 Supreme(Ker) 815

IN THE HIGH COURT OF KERALA AT ERNAKULAM
VIJU ABRAHAM, J.
Naduvannur Regional Co-Operative Bank Ltd. - Petitioner
Versus
The Liquidator/Koyilandy Unit Inspector - Respondent
W.P. (C) Nos. 12209, 20591 of 2022
Decided On : 03-04-2025

Advocates:
Advocate Appeared:
For the Appellant : BY ADVS. P.P.JACOB ANU V. KUTTAN,JOHANS JACOB P.
For the Respondent: BY ADV M.SASINDRAN

IMPORTANT POINT
The government must adhere to prior judicial directions and established legal procedures in liquidation matters, as ignoring them undermines judicial authority.

Headnote:

(A) Kerala Co-operative Societies Act, 1969 - Section 72 and Section 83(1)(f) - Liquidation of defunct co-operative society - Petitioner sought completion of liquidation proceedings for the defunct Naduvannur Service Co-operative Bank Ltd. - Liquidator's decision to transfer assets to petitioner was challenged by third party - Court emphasized the necessity of adhering to procedural requirements for liquidation and the finality of prior judgments. (Paras 2 , 4 , 8 , 10 )

(B) Judicial Authority - The authority must respect and implement the directions of the court, and cannot ignore final judgments. (Paras 8 , 10 )

Facts of the case:

The petitioner, a co-operative society, sought to finalize the liquidation of a defunct bank, which had been ordered by the liquidator. The third respondent contested the proceedings, claiming improper transfer of assets. The court had previously directed the completion of these proceedings.

Findings of Court:

The court found that the government failed to consider the binding nature of its prior judgment and the completed proceedings for asset transfer.

Issues: The main issues included whether the government could set aside the liquidator's order and the necessity of following legal procedures in liquidation.

Ratio Decidendi: The court ruled that the government must adhere to its prior judgments and the established legal procedures in liquidation matters.

Result: Ext.P10 order set aside; government directed to reconsider the matter within three months.

JUDGMENT :

1. Since common issues are raised in these writ petitions, they are heard and disposed of by this common judgment.

WP(C) No.12209 of 2022

2. The above writ petition is filed seeking a direction to the 2nd respondent to finalise and complete the procedural formalities in the matter of liquidation of the defunct Naduvannur Service Co-operative Bank Ltd. No.LL 68 by implementing the direction contained in Ext.P7 judgment.

3. Petitioner is a co-operative society. A nearby society by name Naduvannur Service Co-operative Bank Ltd. No.LL 68 become defunct and the 2nd respondent ordered liquidation appointing the 1st respondent as liquidator in order to complete the proceedings of liquidation. The 1st respondent had proceeded with the liquidation proceedings and the general body of the petitioner took a resolution to the effect that the petitioner is prepared to take over the assets and liabilities of the defunct society and the said resolution was forwarded to the liquidator. The liquidator convened a meeting of the general body of the defunct society on 27.12.2011. No ‘A’ class members attended the meeting and the liquidator exercising the power as per law had taken a decision to handover the assets and liabilities by acting upon the resolution of the general body of the petitioner society. The liquidator after completing the proceedings submitted Ext.P1 report before the Joint Registrar of Co-operative Societies. Certain persons claiming to be members of the defunct society has approached this Court filing W.P.(C) No.17295 of 2013 contending that the liquidation proceedings need not be proceeded and that the functioning of the society can be revived. The said writ petition was disposed of directing the Joint Registrar to consider the matter. Thereafter the Joint Registrar considered the applications and rejected the same confirming the resolution of the liquidator as per Ext.P2 order. Challenging the said order they again approached this Court filing W.P.(C) No.31432 of 2013. The said writ petition was dismissed by Ext.P3. Pursuant to the same as per Ext.P4 proceedings the Joint Registrar considered all the matters and rejected all the contentions raised against the proceedings of the liquidator and directed the Assistant Registrar, Koyilandy to complete all the proceedings. Later Ext.P5 resolution was passed by the petitioner society requesting the Joint Registrar through the Assistant Registrar to finalise the proceedings of liquidation and for transfer of assets and liabilities to the petitioner. Ext.P6 request was also made to the Joint Registrar. Alleging inaction, petitioner has filed W.P.(C) No.10667 of 2019 with a prayer to finalise the proceedings for transfer of assets to the petitioner society and this Court by Ext.P7 judgment directed to complete the proceedings within a period of six months. While proceedings are going on, the 3rd respondent Co- operative Bank taking advantage of the changed political circumstances filed a representation before the Government requesting that the assets of the defunct society may be handed over to them. The Government forwarded the said representation to the Joint Registrar for further action and the Joint Registrar by Ext.P8 order rejected the request holding that all proceedings of liquidation have been completed. Ext.P8 order was challenged by the 3rd respondent filing W.P.(C) No.26191 of 2019. This Court by Ext.P9 judgment directed the Government to consider the representation/appeal as an appeal under Section 83(1)(f) of the Kerala Co-operative Societies Act and to pass orders thereon. Though the petitioner challenged Ext.P9 judgment in W.A.No.240 of 2022, the same was not entertained. The grievance raised by the petitioner is that the proceedings have not been finalised in spite of the specific directions issued by this Court in Ext.P1 to finalise the proceedings without any delay.

WP(C) No.20591 of 2022

4. On the basis of the direction issued by this Court in Ext.P9 judgment

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