Gauhati High Court Orders Expeditious Liquidation of Co-op Bank to Settle Long-Pending Employee Claims - 2025-06-28

Tracking Legal Developments.

Gauhati High Court Directs Liquidator to Expedite Liquidation of Ailing Co-op Bank

Guwahati: In a significant move aimed at resolving the long-standing grievances of employees, the Gauhati High Court has directed the official liquidator to proceed expeditiously with the liquidation of the Assam State Co-operative Agriculture and Rural Development Bank (ASCARD). The court emphasized the prolonged suffering of the bank's employees and the urgent need to settle their claims.

The order was passed by the Hon’ble Mr. Justice Arun DevChoudhury while hearing a batch of writ petitions, including the lead case filed by The Assam State Co-operative Agriculture and Rural Development Bank Employees Union.

---

Background of the Case

The case revolves around the financial collapse of the ASCARD Bank and the subsequent plight of its employees and retirees who have been awaiting the settlement of their dues, including salaries and terminal benefits, for an extended period. The matter has seen numerous legal challenges and petitions filed by various groups of employees and their union, seeking intervention from the court to secure their financial entitlements.

The court had previously been overseeing the matter, including directing state authorities to secure the bank's records to facilitate the liquidation process.

---

Key Proceedings and Court's Direction

In the hearing on June 25, 2025, the court took note of the submission by the Public Prosecutor, Mr. K Gogoi, who confirmed a crucial development. He reported that all official documents from the bank's head office at Ulubari, which had been kept under lock and key, have now been formally handed over to the appointed Liquidator. The handover was documented and signed, ensuring no records remain with the police.

Taking cognizance of this, Justice Choudhury stated that the primary obstacle to the liquidation process has been removed. The court's order recorded:

"In view of the aforesaid, this court is of the opinion that the Liquidator may now proceed with the liquidation process. This court will expect that the liquidation process shall be expeditiously carried out inasmuch as the petitioners herein are suffering since long and their claims are required to be settled at the earliest."

The court has mandated the liquidator to submit a status report on the progress of the liquidation by the next hearing.

---

Implications of the Order

This directive marks a critical step forward for the petitioners. By explicitly ordering an "expeditious" process, the High Court has underscored the humanitarian aspect of the case, acknowledging the hardship faced by the bank's former employees. The order now places the onus on the Liquidator to act swiftly in assessing the bank's assets and liabilities and moving towards settling the legitimate claims of the petitioners.

The matter has been scheduled for its next hearing on July 28, 2025 , when the court will review the liquidator's progress report.