M/S SHILPA SHARES AND SECURITIES & ORS Vs. THE NATIONAL CO-OPERATIVE BANK LTD & ORS

Supreme Court of India (Division Bench (DB)- Two Judge)

Appeal (Civil), 4239 of 2016, Judgment Date: Apr 19, 2016

                                                              NON-REPORTABLE

                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION

                        CIVIL APPEAL NO. 4239 OF 2016
             [ @ SPECIAL LEAVE PETITION (C) NO. 24712 OF 2014 ]


      M/S SHILPA SHARES AND SECURITIES & ORS       Appellant(s)

                                    VERSUS


      THE NATIONAL CO-OPERATIVE BANK LTD & ORS     Respondent(s)


                               J U D G M E N T


KURIAN, J.

1.    Leave granted.

2.    The  case  before  us  has  a  chequered  history  involving  so  many
litigations.  The appellants availed a loan  from  the  first  respondent  -
Bank.  The loan was not serviced and hence, the Bank took steps  to  recover
the dues by proceeding against the secured assets  of  the  appellants.   In
the meanwhile, the Reserve Bank of India announced two  One-Time  Settlement
Schemes, one in the year 2004 and the other in the year 2006.

3.    According to the appellants, when the matter was  under  consideration
before  the  Bank,  the  auction  was  conducted  on  11.02.2008.   However,
according to the respondents, the auction was conducted after the  rejection
of the proposal for One-Time Settlement.

4.    Be that as it may, the auction conducted on 11.02.2008 was  set  aside
by the Divisional Joint Registrar,  Cooperative  Societies,  exercising  his
powers under Section 154 of the Maharashtra Cooperative Societies  Act  read
with Rule 107 of the Maharashtra Cooperative Societies Rules, 1961,  as  per
order dated 20.05.2013.

5.    Challenging the order passed by the Divisional Joint  Registrar,  both
the Bank as well as the 7th  respondent-auction  purchaser  have  filed  two
writ petitions before the High Court, being Writ Petition No.  650  of  2014
by the Bank and Writ Petition No. 572 of 2014 by the 7th  respondent-auction
purchaser.

6.    In the meanwhile, the appellant had already filed  Writ  Petition  No.
173 of 2014 before the High Court, praying for  a  direction  to  the  first
respondent to process his application for One-Time  Settlement.   That  Writ
Petition was dismised by the High Court as per the impugned  Judgment  dated
20.03.2014.  It appears that the High Court has not gone into the merits  of
the case and the writ petition was rejected mainly on the  ground  that  the
writ petition filed by the Bank against the order passed by  the  Divisional
Joint Registrar setting aside the sale was already pending.  As a matter  of
fact, we have already  noted  that  the  writ  petition  filed  by  the  7th
respondent is also pending before the High Court.

7.    In the above factual matrix, in our view, the  approach  made  by  the
High Court, in rejecting the writ petition filed by  the  appellant  on  the
ground that writ petition filed by the Bank is pending, is not correct.   No
doubt, the question of consideration of  the  writ  petition  filed  by  the
appellant herein would arise only in case the writ petitions  filed  by  the
Bank and the 7th respondent-auction purchaser are dismissed.

8.    Therefore, we set aside the impugned Judgment of the  High  Court  and
restore Writ Petition No. 173 of 2014 to the files  of  the  High  Court  of
judicature of Bombay for consideration afresh, after disposal  of  the  Writ
Petition No. 572 of 2014 and Writ Petition No. 650  of  2014  filed  by  the
first  respondent  -  Bank  and   the   7th   respondent-auction   purchaser
respectively.


9.     Sh.  Sudhanshu  S.  Choudhari,  learned  counsel  appearing  for  the
appellants, on instruction, submits that the appellants  will  not  initiate
any fresh litigation in respect of the dispute on the action  taken  by  the
Bank for recovery, till the  Writ  Petition  No.  173  of  2014  is  finally
disposed of.  The above submission is recorded.

10.   We make it clear that it will be open  to  the  parties  to  take  all
available contentions before  the  High  Court,  including  the  contentions
taken by the Bank and the 7th  respondent  on  the  maintainability  of  the
Revision  Petition  under  Section  154  of  the   Maharashtra   Cooperative
Societies Act read with Rule 107 of the  Maharashtra  Cooperative  Societies
Rules, which led to the order dated  20.05.2013  passed  by  the  Divisional
Joint Registrar.  We also make it clear that  we  have  not  considered  the
subject matter on merits.

11.   It is seen that on 20.09.2014, this Court had passed an  order,  as  a
pre-condition for issue of notice in the Special Leave  Petition,  directing
the appellants to deposit an amount of Rs. 44,97,000/- with  Respondent  No.
1 - Bank.  We note that the said amount has already been deposited.

12.   It will be open to the High Court  to  pass  appropriate  orders  with
regard to the said amount, while disposing of Writ Petition No. 173 of  2014
filed by the appellants.

13.   Needless also to  say  that  the  writ  petition  will  be  heard  and
disposed of by the High Court, uninfluenced by any of the observations  made
in this Judgment.

14.    We  request  the  High  Court  to  dispose  of  the   writ   petition
expeditiously and preferably within six months from today.

15.   With the above observations and directions,  the  appeal  is  disposed
of.
      No costs.
                                                   .......................J.
                                                       [ KURIAN JOSEPH ]

                                                   .......................J.
                                                        [ R. BANUMATHI ]

      New Delhi;
      April 19, 2016.