KUNKUMOHAMMED Vs. STATE OF KERALA

JUDGEMENT

(1.) These writ petitions are filed, as the petitioners are aggrieved that the amounts in fixed deposits maintained by them in the Venkurinji Service Cooperative Bank Ltd. No.3023 (hereinafter referred to as 'the Bank') are not being repaid, despite maturity.

(2.) The learned counsel appearing for the respondent Bank submits that the Bank is in dire financial straits. It is submitted that unless the Bank can recover amounts from borrowers, the Bank will not be in a position to repay depositors like the petitioners. It is submitted that the Bank has obtained awards in respect of certain loans advanced by the Bank. It is submitted that, as per the counter affidavit dtd. 20/10/2025 filed in W.P (C) No.218/2025, the amount to be recovered in terms of the awards obtained by the Bank in 41 arbitration cases is Rs.1,30,27,000.00 (Rupees One Crore Thirty Lakh Twenty Seven Thousand Only). It is pointed out that 41 execution petitions have also been filed in respect of the awards that have been obtained by the Bank. It is submitted that the Bank has submitted a revival scheme under the Kerala Co-operative Revival Fund Scheme, 2024 of the Government of Kerala, for availing a sum of Rs.30,00,00,000.00 (Rupees Thirty Crore only) and the same is pending consideration of the Government. It is submitted that the Bank is also entitled to amounts from the Deposit Guarantee Scheme of the additional 8th respondent in W.P (C) No.218/2025.

(3.) Sri. K. Sasikumar, the learned counsel appearing for the additional 8th respondent in W.P (C) No.218/2025 would submit that while there is a provision in the Regulations relating to the Deposit Guarantee for the grant of financial assistance under the Deposit Guarantee Scheme to societies like the petitioner subject to the cap of Rs.5,00,000.00 (Rupees Five lakh only) per deposit, such benefits can be paid only at the time when the society is being wound up or liquidated. It is submitted that since the respondent Bank has not been wound up or liquidated presently, the amounts under the scheme cannot be released. It is submitted that if the respondent Bank is seeking any financial assistance from the scheme for revival, the same will also be granted only after the scheme for revival is approved by the Government.