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2026 Supreme(Online)(Ker) 29530
IN THE HIGH COURT OF KERALA AT ERNAKULAM
Gopinath P., J
Sunny Augustine – Appellant
Versus
Karimannoor Service Co-operative Bank Ltd No.967 – Respondent
WP(C) NO. 14055 OF 2025 | WP(C) NO. 11201 OF 2026 | WP(C) NO. 11282 OF 2026
For the Appellants/Petitioners: Domson J. Vattakuzhy, Mathew Skaria, K.J. Josemon
For the Respondents: K.C. Vincent, Resmi Thomas, Angel Mariya Biju
A court may order the reconsideration of ex parte arbitral awards under the Co-operative Societies Act, subject to strict conditions of partial repayment by borrowers, provided the bank consents, ensuring recovery interests are not prejudiced.
Headnote:The court analyzed the proceedings under S. 69 of the Kerala Co-operative Societies Act, 1969, concerning petitions to set aside ex parte arbitral awards. The petitioners, having availed credit facilities, failed to comply with previous court-ordered repayment conditions. The Court found that relief regarding one-time settlement was infructuous due to the absence of active schemes and the lapse of time. The primary issue was whether the Arbitrator should be directed to re-examine applications for setting aside ex parte awards despite the petitioners' history of non-compliance. The court ruled that equity required balancing the bank's recovery rights with the petitioners' opportunity to be heard, conditional upon a partial deposit of the outstanding liability. The Court disposed of the petitions with a direction for the Arbitrator to hear the applications within two months, provided a sum of Rs. 10,00,000/- is deposited within a month; failing which, the bank is at liberty to proceed with recovery.
| Table of Content |
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| 1. initiation of legal proceedings for setting aside ex parte awards. (Para 1 , 2) |
| 2. conditional granting of relief for the consideration of set-aside applications. (Para 3 , 5) |
JUDGMENT
[WP(C) Nos.14055/2025, 11201/2026, 11282/2026]
One Sunny Augustine, his wife, Susan Sunny and their children, namely Ajith Augustine Sunny and Anu Elizabeth Sunny, availed credit facilities from the Karimannoor Service Co-operative Bank Ltd No.967 (hereinafter referred to as the Bank). W.P.(C) No.14055 of 2025 is filed by the aforesaid Sunny Augustine and his wife, Susan Sunny, seeking a direction to the respondent bank to “enable the petitioners to settle the matter under one time settlement and also granting time till 30.07.2025”. W.P.(C) No.11201 of 2026 is a separate Writ Petition filed by the aforesaid Sunny Augustine seeking a direction to the Arbitrator in proceedings initiated by the Bank under Section 69 of the Kerala Co-operative Societies Act, 1969 (the 1969 Act) to consider and pass orders on the applications (Exts P5 to P7 in W.P.(C) No.11201 of 2026) filed for setting aside the ex parte awards (Exts P1 to P3 in W.P.(C) No.11201 of 2026)
and W.P.(C) No.11282 of 2026 is filed by the aforesaid Susan Sunny seeking a direction to the Arbitrator in proceedings initiated by the Bank under Section 69 of the 1969 Act to consider and pass orders on the application (Ext P2 in W.P.(C) No.11282 of 2026) filed for setting aside the ex parte award (Ext P1 in W.P.(C) No.11282 of 2026). Exts P2 and P3 in W.P.(C) No.11201 of 2026 are awards pertaining to the loans availed by the aforesaid Ajith Augustine Sunny and Anu Elizabeth Sunny.
2. The learned counsel appearing for the petitioners would submit that the Awards, namely, Exts P1 to P3 in W.P. (C) No. 11201 of 2026 and Ext.P1 in W.P.(C) No.11282 of 2026 are ex parte Awards, and applications (Exts P5, P6 and P7 in W.P.(C) No. 11201 of 2026) and Ext P2 in W.P.(C) No.11282 of 2026 have been filed for setting aside the ex parte Awards. It is submitted that the petitioners will be satisfied if a direction is issued to the Arbitrator to consider and pass orders on Exhibits P5 to P7 in W.P.(C) No. 11201 of 2026 and on Ext P2 in W.P.(C) No.11282 of 2026, in accordance with the law, within a time frame to be fixed by this Court. It is submitted that the recovery proceedings may be kept in abeyance till orders are passed on the applications for setting aside the ex parte awards.
3. The learned counsel appearing for the respondent bank would submit that in W.P.(C) No.14055 of 2025, there was an interim order directing the petitioners to remit a sum of Rs.10,00,000/- (Rupees Ten lakhs only) towards the loan liability within a period of one month from 04.04.2025. It is submitted that, even after the passage of more than one year from the date of the interim order, the petitioners have not remitted any amount towards the loan liability. It is submitted that if the petitioners were to remit the aforesaid sum of Rs.10,00,000/- towards the loan liability, within a time frame to be fixed by this Court, the bank has no objection in a direction being issued to the Arbitrator to consider and pass orders on the applications for setting aside the ex parte awards, in accordance with the law. It is submitted that the relief sought in W.P.(C) No.14055 of
2025 has become infructuous. It is also pointed out that the petitioners/their children have conducted several litigations before this Court and have failed to comply with the conditions imposed by this Court while granting interim relief. Reference is made to proceedings in W.P (C) 36736 of 2024 filed by the aforesaid Sunny Augustine along with his daughter and W.P (C) 36788 of 2024 filed by the aforesaid Susan Sunny.
4. Heard the learned Government Pleader also.
5. Having heard the learned counsel appearing for the petitioners, the learned counsel appearing for the respondent bank and the learned Government Pleader appearing for the official respondents, I a
