Rejimon v. Returning Officer Pattanakkad Service Co-operative Bank No.1144, Pattanakkad; The Secretary, Service Co-operative Bank No.1144; Sooriyodhaya Purusha Soyamasaaya Sangam; Sri Sabu

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE K.SURENDRA MOHAN FRIDAY, THE 13TH DAY OF JULY 2012/22ND ASHADHA 1934 WP(C).No. 15859 of 2012 (F) --------------------------- PETITIONER: ------------REJIMON, AGED 37 YEARS S/O.RAGHAVAN, AGED 37 YEARS KOTHAMANGALATH THARA LAKSHAM VEEDU PATTANAKKAD P.O., CHERTHALA, PIN-688643. BY ADV. SRI.JOBY CYRIAC RESPONDENTS: -------------- 1. THE RETURNING OFFICER PATTANAKKAD SERVICE CO-OPERATIVE BANK NO.1144 PATTANAKKAD P.O. CHERTHALA-688643. (UNIT INSPECTOR OFFICE OF THE ASSISTANT REGISTRAR OF CHERTHALA CO-OPERATIVE CIRCLE CHERTHALA). 2. THE SECRETARY, SERVICE CO-OPERATIVE BANK NO.1144, PATTANAKKAD P.O. CHERTHALA-688643. 3. THE SOORIYODHAYA PURUSHA SOYAMSAHAYA SANGAM, (AFFILIATED TO SERVICE CO-OPERATIVE BANK NO.1144) REPRESENTED BY ITS PRESIDENT SRI.SALIM S/O.PONNAPPAN RESIDING AT KOTHAMANGALATH HOUSE PATTANAKKAD P.O., CHERTHALA, PIN-688643. 4. SRI.SABU, S/O.RAGHAVAN, SECRETARY SOORIYODHAYA PURUSHA SOYAMSAHAYA SANAM (AFFILIATED TO SERVICE CO-OPERATIVE BANK NO.1144) RESIDING AT KOCHU KOTHAMANGALATH HOUSE PATTANAKKAD P.O., CHERTHALA-688643. BY ADV. SMT.K.N.RAJANI BY ADV. SRI.V.G.ARUN BY ADV. SRI.T.R.HARIKUMAR BY ADV. SRI.BABU PAUL BY GOVERNMENT PLEADER SHRI.D.SOMASUNDARAM THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 13-07-2012, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: APPENDIX PETITIONER(S) EXHIBITS EXHIBIT P1: TRUE COPY OF THE NOTIFICATION NO.E(2)966/2012/SCE DATED 8- 6-2012. EXHIBIT P2: TRUE COPY OF THE RECEIPT ISSUED IN FORM NO.37 UNDER RULE 35A(6)(C) DATED 2-7-2012 BY R1. EXHIBIT P3: TRUE COPY OF THE ORDER DATED 4-7-2012 ISSUED BY R1. EXHIBIT P4: TRUE COPY OF THE RELEVANT PAGES OF ACCOUNT REGISTER. EXHIBIT P5: TRUE COPY OF THE CERTIFICATE DATED 3-7-2012 ISSUED BY R3 AND 4. EXHIBIT P6: TRUE COPY OF THE MINUTES NO.127 DATED 4-2-2007 ISSUED BY R3 AND 4. EXHIBIT P7: TRUE COPY OF THE CERTIFICATE DATED 4-7-2012 ISSUED BY R2. RESPONDENTS' EXHIBITS EXT.R1A: TRUE COPY OF THE AGREEEMENT EXT.R1B: -DO- OF THE LOAN LEDGER IN RESPECT OF THE 3RD RESPONDENT SHG KEPT IN THE 2ND RESPONDENT BANK EXT.R2A: -DO- OF THE INTER SE AGREEMENT DT.17.1.2005 EXT.R2B: -DO- OF THE LEDGER SHEET EXT.R4A: COPY OF THE LOAN APPLICATION DT.18.1.2005 ALONG WITH THE ANNEXURES EXT.R4B: -DO- INTER-SE AGREEMENT DT.17.1.2005 EXT.R4C: -DO- CONSENT LETTER EXECUTED BY THE PETITIONER DT.17.1.2005 EXT.R4D: -DO- ACCOUNT STATEMENT SHOWING THE DETAILS DISBURSAL AMONGST THE THIRD RESPONDENT JJ /TRUE COPY/ P.S.TO JUDGE **K. SURENDRA MOHAN, J. -----------------------------------------------------------W.P(C) NO: 15859 OF 2012 ----------------------------------------------------------Dated this the 13[th] July, 2012.** ## **JUDGMENT** The petitioner who belongs to a scheduled caste community is a member of the Pattanakkad Service Co-operative Bank No: 1144, Pattanakkad P.O., Cherthala - 688643. An election to the Board of Directors of the Society is proposed to be held on 15-72012 in accordance with Ext.P1 election schedule published by the / Election Commission. The petitioner has filed this writ petition aggrieved by the rejection of his nomination holding that he is in default to the society. The said reasoning has been communicated to him by Ext.P3 which has been issued to him on his request. According to the petitioner, he is not in default to the society. 2. According to the petitioner, he has not availed any loan from the society personally. In the year 2005, he had availed a loan of `10,000/- (Rupees ten thousand only) in his capacity as a member of the third respondent sangam, which is a “self help group” formed by some of the members of the society. According to the petitioner, he has already paid off the entire amount taken by him as loan, in the manner stated above. He relies on Exts.P4, WPC15859/2012 2 P5 and P6 to support his contention. Since the petitioner is not in default to the society, according to him the rejection of his nomination is without any justification and is liable to be set aside. 3. Separate counter affidavits have been filed on behalf of the first and second respondents. The fourth respondent has also filed a separate counter affidavit. 4. I have heard Adv.Joby Cyriac who appears for the petitioner, Adv.Rajani K.N. who appears for the second respondent, the Special Government Pleader Shri D.Somasundaram for the first respondent and Adv.V.G.Arun for the fourth respondent. I have also considered the rival contentions advanced before me. 5. It is not in dispute that the petitioner was a member of the third respondent. The third respondent is not a co-operative society or an organisation registered under any law. The same is only formed by some of the members of the Pattanakkad Service Co-operative Bank (hereinafter referred to as the 'Bank' for short), for the purpose of providing financial help among themselves. They had availed a loan of `1 lakh from the bank after executing an agreement and other necessary documents, as evidenced by Ext.R1 WPC15859/2012 3 (a). A perusal of Ext.R1(a) shows that the 18 members who have signed the said agreement have entered into the agreement as individual debtors as well as inter se sureties for each of the members of the third respondent. Therefore, the petitioner is not only a principal debtor in respect of his loan but also a surety in respect of the loans taken by the other members. The documents do not show that the bank was in any way concerned with the inter se arrangements among the members of the third respondent. The members have bound themselves to the bank for the entire amount of `1 lakh availed as loan, jointly and severally. The above is clear from the terms of the agreement produced. Clause 3 of the inter se agreement, Ext.R2(a) makes the above position clear. Though the petitioner has contended that the amount individually received by him as loan has subsequently been repaid, the said averment is disputed by the fourth respondent. Even assuming that the petitioner has paid the said amount to the third respondent, he has no case that any payment was actually made by him to the bank. Any payment allegedly made to the third respondent cannot operate as discharge of the liability to the bank. Apart from the WPC15859/2012 4 above, since each member of the third respondent has bound himself for the entire amount of `1 lakh availed as loan from the bank, it is not open to the petitioner to contend that by discharge of the actual amount alleged to have been received by him, he can absolve himself of the liability incurred by him by executing the documents referred to above. Therefore, it has to be held that the petitioner is a principal debtor to the society. It is not disputed that the amount taken as loan in the year 2005 has not been repaid till date to the bank. According to the second respondent, the amount has now become `2,06,475/- as on 3-7-2012, the date of scrutiny of the nomination papers. It is for the said reason that the petitioner has been held to be in default to the society. 6. Counsel for the petitioner attacks Ext.P3 contending that the petitioner can be considered only to be a surety to the loan transaction and not a principal debtor. For the various reasons stated above, the said contention has to be rejected. On the ground that the petitioner was only a surety, it is contended that the petitioner should have been issued with a notice as contemplated by Rule 35(3)(e)(ii) of the Kerala Co-operative WPC15859/2012 5 Societies Rules,1969 (the 'Rules' for short). Since I have already found that the petitioner was not a surety, it is not necessary for me to consider this contention in any detail. It is the further contention of the petitioner that in view of Rule 44(c)(i) read with sub rule (2)(a) thereof, he was entitled to be served with a notice before rejecting his nomination. It is to be noticed that sub rule (c) (i) also is a provision that applies to a surety and not to a principal debtor. As already held above, the petitioner was a principal debtor in respect of the amount of `1 lakh availed by him as part of the third respondent. Therefore, the said contention is also not available to him. The petitioner has placed reliance on a decision of this Court in **Salim v. Joint Registrar {1998(2) KLT 665}** to support his contention on the basis that he was a surety. I refrain from considering the said decision also in view of my finding that petitioner was not a surety. 7. As already noticed above, the third respondent had availed the loan in the year 2005. No portion of the loan has been repaid by the third respondent or by any of its members to the bank, till date. In the above situation, it is not permissible for any member of WPC15859/2012 6 the society to wriggle out of his liability by pleading that he had repaid the amount by remitting the same to the third respondent. I notice that the petitioner is seeking election to the Board of Directors of the bank. The bank has not been paid back the amount that has been availed by the third respondent as loan, which includes the petitioner also. Therefore, the petitioner is in default to the bank. I do not find any infirmity in Ext.P3. For the above reasons this writ petition is dismissed. Sd/K. SURENDRA MOHAN Judge jj /True copy/ P.S.to Judge