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2023 Supreme(Online)(Bom) 2716
HIGH COURT OF BOMBAY
SANDEEP V. MARNE, J
Monica Sagar Kate & Anr – Appellant
Versus
The Joint Registrar – Respondent
Writ Petition No. 8440 of 2022 | Writ Petition No. 2755 of 2022 | Writ Petition No. 8431 of 2022 | Writ Petition No. 8432 of 2022 | Writ Petition No. 8430 of 2022 | Writ Petition No. 8433 of 2022 | Writ Petition No. 8434 of 2022 | Writ Petition No. 8435 of 2022 | Writ Petition No. 2758 of 2022 | Writ Petition No. 8436 of 2022 | Writ Petition No. 8437 of 2022 | Writ Petition No. 8438 of 2022 | Writ Petition No. 8439 of 2022 | Writ Petition No. 2757 of 2022
For the Appellants/Petitioners: Tushal Sonawane, Pooja Satpute
For the Respondents: S.D. Rayrikar, G.S. Godbole, Manjiri Parasnis
The court determined that claims relating to loan repayments and document authenticity cannot be resolved at a summary level under Section 101; they require detailed adjudication under Section 91.
Headnote:(A) Maharashtra Co-operative Societies Act, 1960 - Section 101 - Recovery of dues - Petitioners challenged orders remanding proceedings before Assistant Registrar for fresh decision - Petitioners claimed complete repayment of loans supported by 'No Dues Certificates' and Release Deeds, which were denied by Respondent-Society - Issues of genuineness and authority related to these documents highlighted - Court found Registrar could not adjudicate complex disputes - Writ petitions allowed, remanding orders set aside. (Paras 1-25)
(B) Jurisdiction of Assistant Registrar - Limited to summary proceedings under Section 101, cannot resolve disputed questions - Concerns raised regarding issuance of fraudulent certificates - Validity of 'No Dues Certificates' must be established in full inquiries under Section 91, not Section 101. (Paras 18-20)
Facts of the case:
Petitioners are borrowers claiming full repayment of loans with supporting documentation; Respondent-Society alleges lack of repayment citing unauthorized issuance of 'No Dues Certificates' and Release Deeds.
Findings of Court:
The inquiry under Section 101 is too narrow to resolve such factual disputes involving document authenticity; valid defenses must be adjudicated in cooperative court proceedings.
Issues: Whether proceedings under Section 101 are appropriate for disputes surrounding loan repayment legitimacy and related documents.
Ratio Decidendi: The Registrar's authority under Section 101 is limited to inquiries about arrears and does not allow for evidence or cross-examination of the parties involved, necessitating the parties to resolve disputes through the broader ambit of Section 91.
Result: Writ Petitions allowed and remanding orders set aside.
| Table of Content |
|---|
| 1. challenge to recovery certificate issuance. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7) |
| 2. assistant registrar's decision status. (Para 8 , 9) |
| 3. arguments presented by parties. (Para 10 , 11 , 12 , 13) |
| 4. core issue of jurisdiction under section 101. (Para 14 , 15) |
| 5. enquiry scope for recovery certificates. (Para 16 , 17 , 18 , 19 , 20) |
| 6. validity of documents in doubt. (Para 21 , 22) |
| 7. impugned orders unsustainable. (Para 23 , 24) |
| 8. writ petitions allowed. (Para 25) |
JUDGMENT
1. These Petitions are filed challenging orders dated 31st December 2021 passed by the Divisional Joint Registrar allowing Revision Applications filed by Respondent Credit Society and remanding the proceedings before the Assistant Registrar for a fresh decision. The Assistant Registrar had rejected proceedings filed by Respondent-Credit Society for issuance of recovery certificate under Section 101 of the Maharashtra Co-operative Societies Act 1960 (Act of 1960).
2. Petitioners are borrowers who have availed credit facilities from Respondent No.3-Credit Society. They claim that the entire amount due under said Credit facilities have been repaid by them with interest, on account of which the Credit Society issued various ‘No Dues Certificates’ to Petitioners. It is further contended that after issuance of ‘No Dues Certificates’, the Respondent-Credit Society executed Release Deeds in their favour. Facts in all the Petitions are similar. For brevity, facts in Writ Petition No.8440/2022 are narrated as follows.
3. Chatrapati Sambhaji Maharaj Sahakari Patsanstha, Baramati (Respondent No.3) is a Credit Society registered under the provisions of the Act of 1960. Petitioners are members of the Respondent-Society which granted and disbursed loan of Rs. 14,000,00/- to them for business purposes. In pursuance of the loan transaction, Petitioners executed promissory note, acceptance letters, consent letter of sureties, loan agreement, etc. in favour of the Respondent- Society. Petitioners also offered agricultural property admeasuring 10 Acre out of Survey No.45/5/B at Baramati as well as residential Unit No.3 in the building ‘Kate Pride’ at Baramati, District Pune towards security for the loan.
Petitioners also executed Mortgage Deed in favour of the Respondent-Society on 28th August 2015, which came to be registered in the office of Sub-Registrar of Assurances, Baramati.
4. Petitioners claim that they have repaid the entire amount availed by them towards loan along with interest to the Respondent-Society. They contend that the Respondent- Society accordingly issued ‘No Dues Certificate’ on 24th October 2016 certifying that no amount was due or payable by the Petitioners in the loan account. Petitioners also claim that on account of repayment of the entire loan amount, Respondent-Society executed Release Deed dated 11th July 2016 in favour of the Petitioners releasing their charge over the two mortgaged properties.
5. The Respondent-Society later claimed that the Petitioners had neither repaid the loan amount, nor any ‘No Dues Certificate’ was issued by the Society. The Respondent- Society also denied having executed any Release Deed in favour of Petitioners. The Respondent-Society claims that its Branch Manager unauthorizedly issued ‘No Dues Certificate’ and executed Release Deed without any decision to that effect being taken in the managing committee meeting of the Society.
6. The Respondent-Society has accordingly filed Special Civil Suit No.51/2019 seeking a declaration that various Release Deeds unauthorizedly executed by the Branch Manager are ab initio void and not binding on the Respondent- Society. It has also sought a declaration that it continues to have the charge over mortgaged properties in pursuance of various Mortgage Deeds executed in his favour. Some of the subsequent Sale Deeds executed by the borrowers/guarantors/mortgagor are also sought to be cancelled in the said suit. The Respondent-Society sought temporary injunction against the Defendants
