SMITA VAIBHAV MULAY Vs. UNION OF INDIA

JUDGEMENT

(1.) Heard Counsel for the parties.

(2.) In all these petitions, the respondent bank is Multi-State Co-operate Bank. The petitioner in respective petitions have challenged the proposed coercive action of the respondent bank on the ground that the respondent bank, being a Multi-State Co operative bank is not a bank within the meaning of Section 2(c) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. The Multi-State Co-operative bank could be treated as a bank for the purpose of Act of 2002, if the Central Government were to issue notification specifying the Multi-State Co operative bank. However, the notification issued by the Central Government dated 28-01-2003 is only in respect of Co-operative bank as defined in clause (cci) of Section 56 of the Banking Regulation Act, 1949, as bank for the purpose of Act of 2002. The definition of "Co-operative Bank" provided in Section 56(cci) of the Banking Regulation Act, 1949, means a state co-operative bank, a central co-operative bank, and primary co-operative bank.

(3.) It is common ground that the respondent bank being a multi-State co operative bank, is neither a state co-operative bank nor a central co-operative bank as such. The question is whether the respondent bank is a primary co-operative bank. The term "primary co-operative bank" is defined to mean a co-operative society other than a primary agricultural credit society and which ought to fulfill the three requirements provided in Section 56 (ccv). According to the petitioners, the respondent co-operative bank does not fulfill the condition Nos.1 and 3 of the said provision, namely, that the primary object or principal business of which is the transaction of banking business and that the bye-laws of which do not permit admission of any other co-operative society as a member. For that reason, according to the petitioners, the respondent bank cannot be considered a bank within the meaning of Act of 2002.