Case Note & Summary
The petitioners, M/s. Vilas Transport Co., a partnership firm, filed a writ petition under Article 226 of the Constitution of India challenging two orders dated 25 June 2010 and 7 June 2011 passed by the Special Recovery Officer and Sales Officer (respondent no.2) on an application bearing No.2 of 2010. The petitioners had sought marking of two recovery certificates (No.101/Sangli/1588 of 2002 and No.101/Sangli/1589 of 2002, both dated 13 September 2002) as satisfied and refund of an alleged excess amount of Rs.2,80,16,156/-. The recovery certificates were issued under Section 101 of the Maharashtra Cooperative Societies Act, 1960 (MCS Act) by the Assistant Registrar upon the application of the first respondent bank (Sangli Sahakari Bank Limited) for recovery of dues arising from credit facilities granted to the petitioners. The petitioners contended that they had repaid the entire dues and that the bank had recovered more than the amount due. The Special Recovery Officer, by the impugned orders, allowed the application and directed the recovery certificates to be marked as satisfied and the excess amount to be refunded. The bank challenged these orders before the High Court. The court examined the scheme of the MCS Act, particularly Sections 101, 156, 91, and 163. It held that the Special Recovery Officer appointed under Section 156 is a mere executing authority with no adjudicatory powers. The officer cannot go behind the recovery certificate or decide disputes regarding its satisfaction or refund. Such disputes must be raised before the Registrar under Section 91 or before the civil court. The impugned orders were therefore without jurisdiction and liable to be set aside. The court also noted that the petitioners had an alternative remedy under Section 91, which they had not availed. Consequently, the writ petition was dismissed, and the impugned orders were quashed.
Headnote
A) Cooperative Law - Recovery Certificate - Jurisdiction of Special Recovery Officer - Sections 101, 156, 91, 163 of Maharashtra Cooperative Societies Act, 1960 - The Special Recovery Officer acting under Section 156 of the MCS Act has no power to adjudicate on the validity or satisfaction of a recovery certificate issued under Section 101, nor to order refund of any amount. Such disputes fall within the exclusive jurisdiction of the civil court or the Registrar under Section 91. The impugned orders directing marking of certificates as satisfied and refund were held to be without jurisdiction and set aside. (Paras 5-10) B) Cooperative Law - Alternative Remedy - Section 91 of Maharashtra Cooperative Societies Act, 1960 - The petitioners had an efficacious alternative remedy by way of a dispute under Section 91 of the MCS Act before the Registrar or by approaching the civil court. The writ petition under Article 226 was not maintainable in the absence of exceptional circumstances. (Paras 11-12)
Issue of Consideration
Whether the Special Recovery Officer under the Maharashtra Cooperative Societies Act, 1960 has the jurisdiction to entertain an application for marking a recovery certificate as satisfied and for refund of excess amount, and whether the impugned orders are sustainable in law.
Final Decision
The writ petition is dismissed. The impugned orders dated 25 June 2010 and 7 June 2011 are set aside. The petitioners are at liberty to pursue appropriate remedies before the Registrar under Section 91 of the MCS Act or before the civil court.
Law Points
- Jurisdiction of Special Recovery Officer under MCS Act
- 1960
- Section 101 recovery certificate
- Satisfaction of recovery certificate
- Refund of excess amount
- Alternative remedy under Section 91 of MCS Act
