SCA/7842/2008 6/ 6 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No. 7842 of 2008 With SPECIAL CIVIL APPLICATION No. 7843 of 2008 To SPECIAL CIVIL APPLICATION No. 7844 of 2008 with SPECIAL CIVIL APPLICATION No.7892 of 2008 ================================================= DILIPBHAI NANJIBHAI PATEL & 1 - Petitioner(s) Versus STATE OF GUJARAT & 2 - Respondent(s) ================================================= Appearance : Mr.MIHIR JOSHI, SENIOR ADVOCATE WITH Mr.VIMAL M PATEL for Petitioners in SCAs No.7842/08, 7843/08 & 7844/08; Mr.P.S. Champaneri, learned advocate in SCA No.7870/08; and Mr.Manav A. Mehta, learned advocate in SCA No.7892/08. Mr.APURVA DAVE, ASST GOVERNMENT PLEADER for Respondent(s) : 1, DS AFF.NOT FILED (N) for Respondent(s) : 1 - 2. NOTICE SERVED for Respondent(s) : 2, NOTICE SERVED BY DS for Respondent(s) : 3, MR TUSHAR MEHTA for Respondent(s) : 3, ================================================= CORAM : HONOURABLE MR.JUSTICE RAVI R.TRIPATHI Date : 10/07/2008 COMMON ORAL ORDER
Heard
learned senior advocate Mr.Joshi, with Mr.Vimal M. Patel, learned
advocate for the petitioners (SCAs No.7842/08, 7843/08 &
7844/08), Mr.P.S. Champaneri, learned advocate for petitioners in SCA
No.7870/08 and Mr.Manav A. Mehta, learned advocate for petitioners in
SCA No.7892/08.
2. Rule.
3. Mr.Apurva
Dave, learned Assistant Government Pleader for the respondent-State
vehemently opposes grant of interim relief. He submitted that the
State Cooperative Tribunal has passed order after taking into
consideration all the relevant aspects; therefore, interim relief is
not required to be granted.
4. Taking
into consideration the peculiar facts of the case, which are also set
out in detail in the judgement and order dated 16th March
2006 of this Court (Coram: M.S. Shah & Sharad D. Dave, JJ.) in
Special Civil Applications No.15859/ 04, 15862/ 04 and 15863/04, more
particularly, in paras 9, 10, 11 and 12, which read as under:
ýS9. It is further
submitted by the learned counsel for the petitioners that when they
were in office, they had already initiated recovery proceedings
including filing of complaints under Section 138 of the Negotiable
Instruments Act and also the summary suit, but it is the
administrator appointed by the State Government, who entered into MOU
with the defaulting party being C.R. Bhansali, proprietor of CRB
Capital Ltd. on 26.9.2002, foregoing interest on the entire amount of
Rs.3 Crores which was agreed to be repaid by the defaulter in ten
annual installments and it is the administrator appointed by the
State Government who agreed to stay all recovery proceedings,
including the criminal proceedings pending in the Court of the
learned Chief Metropolitan Magistrate, Ahmedabad under Section 138 of
the Negotiable Instruments Act.
It is also pointed out
that the aforesaid MOU was entered into by the administrator after
obtaining approval of the Joint Registrar (Advance) of the
Co-operative Societies, Gujarat State on 23.9.2002. It is, therefore,
submitted that the State Government which itself has stayed recovery
proceedings, cannot be permitted to accuse the former Directors of
any default or any mala fide intention which is necessary for
invoking powers under Section 93 of the Act as well as under Section
76B of the Act.
10. Having heard the
learned counsel for the petitioners, we find that in view of the stay
of recovery proceedings granted by the Administrator, the petitioners
could not have been required to make the payment of the amounts
determined under Section 93 of the Act and, therefore, the learned
Single Judge was justified in granting the interim relief on
21.12.2004. But now upon our having granted interim stay of the MoU
dated 26.9.2002 between the Administrator and CR Bhansali of CRB
Capitals Ltd., the recovery proceedings can now be proceeded with and
there will be no impediment to any recovery being made from CR
Bhansali and others who are liable to repay the amounts to Baroda
District Central Cooperative Bank Ltd. But considering the fact that
the liability determined by the Registrar under Section 93 of the Act
is to the tune of Rs.3 Crores approximately and that the condition
imposed by the Tribunal for granting stay in favour of the
petitioners comes to hardly about 10 to 15% of their liability
determined under Section 93, the interim orders passed by the
Tribunal do not require any interference in so far as the Tribunal
has imposed the condition of depositing certain amounts by the
petitioners herein.
11. In the facts and
circumstances of the case, however, it also appears to the Court
that the interests of justice would be served if the petitioners are
granted some time to pay the amounts as stipulated in the conditional
stay order passed by the Tribunal. At the same time, since the order
of the District Registrar imposing disqualification under Section 76B
was passed on the basis of orders under Section 93 of the Act and
the Tribunal has granted conditional interim stay, we are of the view
that the petitioners have made out a case for staying the direction
for disqualification, subject to compliance with the conditions
stipulated by the Tribunal in the interim stay orders and subject to
compliance with the final orders, if any, which may be passed at the
final hearing of the appeals by the Tribunal.
12. These petitions
are accordingly partly allowed in so far as the Tribunal did not
grant any interim stay against any disqualification proceedings
arising from the liability under Section 93 of the Act. During
pendency of the appeals before the Tribunal, there shall be stay
against disqualification arising from the liability under Section 93
of the Act, provided the respective petitioners deposit, without
prejudice to their rights and contentions, the amounts as stipulated
in the interim stay orders passed by the Tribunal. As far as the
amounts stipulated by the Tribunal in the said conditional stay
orders are concerned, we do not interfere with the said conditions
but grant the petitioners time to deposit the amounts as stipulated
in the interim stay orders of the Tribunal in six equal monthly
installments commencing from 10th April 2006. The Tribunal
shall endeavour to complete the hearing and decide the appeals by
31st December 2006.
Rule is accordingly
made absolute only to the aforesaid extent with no order as to
costs.ýý
and
taking into consideration the averments made in grounds (N) and (O),
which read as under.
ýS(N) That similar
other banks have deposited the money with the said bank including
GIIC, which is a government undertaking. Similar inquiry was
conducted against the directors of Mehsana District Madhyasth Sahkari
Bank Ltd. and Kheralu nagrik Sahkari Bank Ltd wherein the inquiry
officer for the similar act of deposit by the aid Bank with the said
company came to the conclusion that there is no gross negligence and
no action has been taken. However, the petitioners have been
discriminated and liability has been fastened u/s 93 of the aid Act
for the similar act of deposit made with the said company.
Therefore, the act of respondent no.2 is in violation of Article 14
of the Constitution of India and action has been taken with a mala
fide intention to see that the petitioners do not participate in
future elections that may be held with the respondent no.3 and in
respect of other similar societies.
(O) That, on one hand
the respondent no.1 has entered into a Memorandum of Understanding
with the said company whereby the execution proceedings and the
criminal proceedings are stayed sine die and proceeding are initiated
against the petitioners fastening the liability u/s 93 of the said
Act and recovery for the very same dues which can be legally
recovered pursuant to the execution proceedings and criminal
proceedings from the said company. The said conduct itself shows the
mala fide motive of the respondents to fasten the liability u/s 93 of
the said Act with a sole intention to initiate disqualification
proceedings arising from the liability u/s 93 of the said Act.ýý
the
Court deems fit to grant interim relief. Interim relief in terms of
para 23(B) in Special Civil Applications No.7842/08, 7843/08 &
7844/08; para 7(B) in Special Civil Applications No.7870/08 &
7892/08 is granted. Direct service is permitted.
(RAVI R. TRIPATHI, J.)
karim