AMRITLAL P. SHAH Vs. TJSB SAHAKARI BANK LIMITED

JUDGEMENT

(1.) By judgment and order dtd. 11/11/2025, the writ petition filed by Respondent No.1 was allowed and the order dtd. 27/12/2021 passed by the Maharashtra State Cooperative Appellate Court was set aside. Consequentially, the money decree dtd. 25/10/2017 passed in favour of Respondent No.1 and against the present Petitioner stood restored. The Petitioner, who was the original respondent in the writ petition, has preferred the present review petition seeking review of the judgment dtd. 11/11/2025. The sole ground urged in the review petition is the order dtd. 3/11/2025 passed by the learned Single Judge of this Court at the Nagpur Bench in Washim Urban Cooperative Bank Ltd. v. Girishchandra, 3246(N.B.), in Writ Petition No.3783 of 2021 dtd. 3/11/2025( Nagpur Bench) wherein it has been observed that a cooperative bank is a bank within the meaning of the Recovery of Debts and Bankruptcy Act, 1993("RDB Act")and the Cooperative Courts under the Maharashtra Cooperative Societies Act, 1960("MCS Act") are barred from entertaining applications for recovery of debts exceeding Rupees Ten Lakhs.

(3.) I have heard learned counsel and have considered all submissions. The principal questions are (a) whether a co- operative bank is a "bank" under the RDB Act so as to confer exclusive jurisdiction on the DRT for debt recovery beyond ?10 lakh, thereby ousting the Co-operative Court under Sec. 91 MCS Act, and (b) whether Pandurang Ganpati Chaugule and the Washim Urban judgment applying it, require reconsideration by a larger bench in view of the Respondents' contentions. Because these issues involve a significant interplay of constitutional entries and conflicting precedents, and in the absence of a directly on- point Supreme Court ruling on the RDB Act, I refrain from a final determination on the merits and leave the matter to a larger bench. However, for completeness I detail below the arguments of each side and my provisional analysis of the competing legal positions. <PARA> The Respondent Bank calls in question the correctness of the Single Judge's decision in Washim Urban Co-operative Bank Ltd. v. Girishchandra, which held that a co-operative bank's loan recovery claims in excess of ?10 lakh fall exclusively within the jurisdiction of the Debts Recovery Tribunal (DRT) under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 and oust the Co-operative Court's jurisdiction under Sec. 91 of the MCS Act . The Petitioner in this review submits that Pandurang Ganpati Chaugule v. Vishwasrao Patil Murgud Sahakari Bank Ltd. (2020) 9 SCC 215] and the Washim Urban decision itself dictate that co- operative banks are "banks" under central law and must proceed only under the RDB Act, not under Sec. 91 MCS Act. The Respondent contends that Pandurang Ganpati Chaugule dealt exclusively with the SARFAESI Act, and did not alter the law as to the RDB Act; that the definition of "bank" in the RDB Act differs; and that earlier law in Greater Bombay Coop. Bank Ltd. v. United Yarn Tex Pvt. Ltd., 2007(3) Bom.C.R. 56(S.C.) : (2007) 6 SCC 236 excluded co-op banks from RDB jurisdiction. He further argues that the constitutional basis (Part IX-B of the Constitution via the 97th Amendment) supporting Pandurang Ganpati Chaugule has since been struck down in Union of India v. Rajendra N. Shah (2022) 19 SCC 520], rendering Pandurang Ganpati' Chougule's reasoning weak.

(4.) The facts are not in dispute. The Washim Urban Co-op Bank a society registered under the MCS Act had advanced loans to the respondents who were member-borrowers. The sums due exceeded ?10 lakh. The Bank filed a recovery petition before the Co-operative Court under Sec. 91 MCS Act. The borrowers challenged the jurisdiction of the Co-operative Court on the ground that the Debts Recovery Tribunal (DRT) under the RDB Act had exclusive jurisdiction for such claims. The Co-operative Court initially proceeded with the case. On appeal, the Co-operative Appellate Court relied on Pandurang Ganpati Chaugule and held that the Bank is a "bank" under the RDB Act, so that Ss. 17 -18 of the RDB Act apply and bar the Co-operative Court's jurisdiction (as the claim exceeds the ?10 lakh threshold). The Bank then challenged that ruling in this Court by way of writ petition under Article 226. The Single Judge in Washim Urban Coop. Bank Ltd. v. Girishchandra agreed with the Appellate Court: it found that Pandurang Ganpati Chaugule establishes that a co- operative bank is a "banking company" under the RDB Act, and that Sec. 18 RDB Act bars other forums for recovery above ?10 lakh. The writ petitions were dismissed.