W.A. Nos.80 of 2022 & 83 of 2022 (Intra Court Appeals) arising out of WP(C) Nos.6094/2021 and 17879/2020, High Court of Kerala

## **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** ## **`PRESENT`** ## **`THE HONOURABLE MR. JUSTICE ALEXANDER THOMAS`** ## **`&`** ## **`THE HONOURABLE MRS. JUSTICE SHOBA ANNAMMA EAPEN`** ``` WEDNESDAY, THE 20[TH] DAY OF JULY 2022 / 29TH ASHADHA, 1944 ``` ## **`WA NO. 80 OF 2022`** ## **`AGAINST THE JUDGMENT DATED 26.08.2021 IN WP(C) 6094/2021 OF HIGH COURT`** ## **`OF KERALA`** ## **`APPELLANTS/RESPONDENT NOS.4 & 6:`** - `1 THE EDAMULACKAL SERVICE CO-OPERATIVE BANK LT., NO.2047, EDAMULACKAL P.O., ANCHAL, KOLLAM DISTRICT-691 306, REPRESENTED BY ITS SECRETARY.` - `2 THE BRANCH MANAGER THE EDAMULACKAL SERVICE CO-OPERATIVE BANK LTD., NO.2047, AYOOR BRANCH, AYOOR P.O., KOLLAM DISTRICT-691 533.` ``` BY ADVS. K.C.SANTHOSHKUMAR K.K.CHANDRALEKHA ``` ## **`RESPONDENTS/PETITIONERS & RESPONDENT NOS.1 TO 3, 5 & 7:`** - `1 A.DAMODHARAN PILLAI AGED 86 YEARS, S/O.AYYAPPAN PILLAI, KIZHAKKUMKARA PUTHENVEEDU, KUNDOOR, AYOOR P.O., AYOOR, EDAMULACKAL VILLAGE, PUNALUR, KOLLAM DISTRICT.` - `2 D. ANILKUMAR AGED 51 YEARS, S/O DAMODHARAN PILLAI, KIZHAKKUMKARA PUTHENVEEDU, KUNDOOR, AYOOR P.O., AYOOR, EDAMULACKAL VILLAGE, PUNALUR, KOLLAM DISTRICT.` - `3 RESERVE BANK OF INDIA REPRESENTED BY CHIEF GENERAL MANAGER, REGIONAL OFFICE, KOCHI, ERNAKULAM NORTH-682 018.` - `4 REGISTRAR OF CO-OPERATIVE SOCIETIES OFFICE OF THE REGISTRAR OF CO-OPERATIVE SOCIETIES, JAWAHAR SAHAKARANA BHAVAN, DPI JUNCTION, THYCAUD P.O., THIRUVANANTHAPURAM-695 014.` - `5 DISTRICT CO-OPERATIVE BANK CHAMBAKKADA, KOLLAM, KERALA-691 001, REPRESENTED BY ITS MANAGER.` ``` 6BRANCH MANAGER ``` ``` EDAMULACKAL SERVICE CO-OPERATIVE BANK LTD., NO.2047, EDAMULACKAL BRANCH, EDAMULACKAL P O, ANCHAL, KOLLAM-691 321. * (STRUCK OFF) ``` - `7 KERALA STATE CO-OPERATIVE BANK LTD., REPRESENTED BY ITS GENERAL MANAGER, OPPOSITE COLLECTORATE, KOLLAM, KERALA-691 013.` - `AS PER ORDER DATED 9/6/22, THE 6TH RESPONDENT WILL STAND STRUCK OFF FROM THE RESPONDENT ARRAY.` ``` BY ADV P.C.SASIDHARAN, SC, KOLLAM DISTRICT CO-OPERATIVE BANK LTD. (FOR R5 & R7) ``` ``` ADV.GEORGE VARGHESE (PERUMPALLIKUTTIYIL) (FOR R1 & R2) ``` ## **`OTHER PRESENT:`** ``` SRI. T.K.VIPINDAS- SR. GP ``` ``` THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 20.07.2022, ALONG WITH WA.83/2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` # **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** # **`PRESENT`** ## **`THE HONOURABLE MR. JUSTICE ALEXANDER THOMAS`** ``` & ``` ``` THE HONOURABLE MRS. JUSTICE SHOBA ANNAMMA EAPEN WEDNESDAY, THE 20[TH] DAY OF JULY 2022 / 29TH ASHADHA, 1944 ``` ``` WA NO. 83 OF 2022 ``` ``` AGAINST THE JUDGMENT DATED 26.08.2021 IN W.P(C) 17879/2020 OF HIGH ``` ## **`COURT OF KERALA`** ## **`APPELLANTS/REVIEW PETITIONERS/RESPONDENT NOS.3 TO 5:`** - `1 THE PRESIDENT, THE EDAMULACKAL SERVICE CO-OPERATIVE BANK LTD. NO.2047, ANCHAL, KOLLAM DISTRICT - 691 306.` - `2 THE EDAMULACKAL SERVICE CO-OPERATIVE BANK LTD. NO.2047, ANCHAL, KOLLAM DISTRICT - 691 306, REPRESENTED BY ITS SECRETARY.` ``` 3THE BRANCH MANAGER THE EDAMULACKAL SERVICE CO-OPERATIVE BANK LTD. NO.2047, EDAMULACKAL BRANCH, EDAMULACKAL, KOLLAM DISTRICT - 691 533. ``` ``` BY ADVS. K.C.SANTHOSHKUMAR K.K.CHANDRALEKHA ``` ## **`RESPONDENTS/PETITIONERS & RESPONDENT NOS.1 & 2:`** ``` 1SREEKANDAN AGED 72 YEARS, S/O.NANU PILLAI, SREESYLAM, EDAMULACKAL P.O., KOLLAM DISTRICT - 691 306. ``` ``` 2DEVI V.S. D/O.SREEKANDAN, SREESYLAM, EDAMULACKAL P.O., KOLLAM DISTRICT - 691 306. ``` - `3 PARVATHY V.S. D/O.SREEKANDAN, SREESYLAM, EDAMULACKAL P.O., KOLLAM DISTRICT - 691 306.` ``` 4STATE OF KERALA REPRESENTED BY THE SECRETARY TO GOVERNMENT, CO-OPERATION DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM – 1. ``` ``` 5THE JOINT REGISTRAR (GENERAL) CO-OPERATION DEPARTMENT, KOLLAM DISTRICT - 691 013. ``` ``` BY ADV. MANOJ RAMASWAMY (B/O) ADV. T.K.VIPINDAS (SR.G.P) ``` ``` THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 20.07.2022, ALONG WITH WA.80/2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` ## **ALEXANDER THOMAS & SHOBA ANNAMMA EAPEN, JJ.** **-----------------------------------------------------------------------------------** ## W.A. No.80 of 2022 _[arising out of the judgment dated 26.08.2021 in W.P.(C) No.6094/2021]_ _**&**_ ## W.A. No.83 of 2022 _[arising out of the judgment dated 26.08.2021 in W.P.(C) No.17879/2021]_ _**-----------------------------------------------------------------**_ Dated this the 20[th] day of July, 2022 ## **JUDGMENT** ## **Alexander Thomas, J.** ## **W.A. No.80 of 2022:-** The aforecaptioned intra court appeal has been instituted to impugn the judgment rendered on 26.08.2021, by the learned Single Judge, disposing of the instant writ petition, W.P.(C) No.6094/2021. The appellants herein are respondent Nos.4 & 6 in the W.P.(C) and the respondent Nos.1 & 2 herein are the writ petitioners in the W.P.(C), respondent Nos.3 to 5 in the writ appeal are respondent Nos.1 to 3 in the W.P.(C), respondent No.6 in the writ appeal/ 5[th] respondent in the W.P.(C) has been deleted from the respondent array in this appeal. The 7[th] respondent in the writ appeal is the 7[th] respondent in the W.P.(C). 2. Heard Sri.K.C. Santhosh Kumar, learned counsel appearing for the appellant in the writ appeal, Sri.George Varghese (Perumpallikuttiyil), learned counsel appearing for respondent W.A. Nos.80 & 83 of 2022 2 Nos.1 & 2 in the writ appeal, Sri.T.K. Vipindas, learned Senior Government Pleader, appearing for respondent Nos.3 & 4, Sri.P.C. Sasidharan, learned counsel appearing for respondent Nos.5 & 7 in the writ appeal. 3. The prayers in the instant W.P.(C) No.6094/2021 are as follows:- - _“i) issue a writ in the nature of mandamus, or any other appropriate writ, direction or order, directing respondents 4 to 6 to return the deposit amounts covered by Exts.P1 to P9 to the petitioners within such time as may be fixed by this Honourable Court;_ - _ii) issue a writ in the nature of mandamus, or any other appropriate writ, direction or order, directing the 1[st] respondent to issue necessary directions to the 4[th] respondent to return the deposit amounts covered by Exts.P1 to P9 due to the petitioners;_ - _iii) issue a writ in the nature of mandamus or any other writ direction or order directing the 7[th] respondent to pay of the money covered by Exts.P1 to P9 due to the petitioners from out of the cash reserve on the 4[th] respondent;_ - _iv) issue a writ in the nature of mandamus, or any other appropriate writ, direction or order, directing the 1[st] respondent to act upon Ext.P10 representation, and to impose penalties on the 4[th] respondent for breach of the provisions of the Banking Regulation Act, 1949;_ - _iv) issue such other writ, direction or order as deemed fit.”_ 4. The learned Single Judge, after hearing both sides, has rendered the impugned judgment on 26.08.2021, whereby the W.P.(C) has been disposed of directing that the appellants herein shall disburse the proceeds of the matured fixed deposits, held by the writ petitioners, within 3 months. W.A. Nos.80 & 83 of 2022 3 5. It appears that the appellant Bank is now in great financial distress due to various reasons. Going by the submissions of Sri.P.C.Sasidharan, learned counsel appearing for the 7[th] respondent (Kerala State Co-operative Bank Ltd.), the appellant Bank owes liabilities to the tune of about Rs.4 crores, by way of over draft and other financial facilities, to the 7[th] respondent-Kerala State Cooperative Bank Ltd. Whereas the fixed deposits made by the appellant Bank with the 7[th] respondent-Kerala State Co-operative Bank is only about Rs.40 lakhs and therefore the 7[th] respondent-Kerala State Cooperative Bank Limited, by exercising the Banker’s lien, has decided not to release the fixed deposit amounts held in their Bank, as the outstanding liability owed by the appellant Bank to the 7[th] respondent is far in excess of their fixed deposit amounts. 6. In a similar case, where the Co-operative society could not repay the matured proceeds of the fixed deposits, the learned Single Judge had directed disbursal of the due amounts. The Division Bench of this Court has rendered judgment rendered on 19.07.2022 in W.A. No.1693 of 2018 (arising out of judgment dated 14.06.2018 in W.P.(C) No.36425/2017), whereby it was ordered that it was for the appellant to seek remedy under Sec.69 of the Kerala Co-operative Societies Act W.A. Nos.80 & 83 of 2022 4 by filing Arbitration Reference case before the notified authority, for return of the monetary amounts covered by the fixed deposits, etc. 7. There is no dispute that the appellant Bank will not fulfill the definition of State as per Article 12 of the Constitution of India and ordinarily the impugned action in the matter of payment or nonpayment of matured proceeds on the fixed deposits, held with the appellant Bank, to the writ petitioners cannot be said to be a matter of grievance which arises out of a public duty or on an obligation of a public nature on the part of the appellant Bank, which can be enforced by way of public law remedy under Article 226 of the Constitution of India. In that regard, it has to be borne in mind that the prayers in the writ proceedings would essentially allow to interdict dealings of a banking activity as between private customers and the appellant Bank and the activity ordinarily should be seen within the realm of Banking transactions and therefore may not be amenable with public law remedy under Articles 226 of the Constitution of India. In that regard, the appellants have placed reliance on the dictum laid down by the Apex Court in the case in _**Federal Bank Ltd.** v._ _**Sagar Thomas & others**_ [(2003) 10 SCC 733]. W.A. Nos.80 & 83 of 2022 5 8. The writ petitioners have no case that the appellant Bank has violated any statutory provisions in relation to their impugned action regarding their liability to pay the amounts. That apart, we are of the view that this may not be a fit case to exercise discretion to allow the reliefs sought for in the writ proceedings inasmuch as the appellant Bank is in financial distress due to various reasons, presumably on account of financial mismanagement, etc. 9. That apart, aggrieved persons in the writ petition have an efficacious alternate remedy by approaching the notified adjudicating authority by instituting Arbitration Reference case, seeking for return of the monetary amounts covered by way of fixed deposit in terms of Sec.69 of the Kerala Co-operative Societies Act and after securing the award, they can seek for execution and enforcement of such award. When such remedy is available, it may not be right and proper for this Court to exercise its prerogative writ jurisdiction and that too in a matter, which is eminently within the realm of banking activity. Hence, we are of the view that the present case may not be a fit case to exercise discretionary jurisdiction under Article 226 of the Constitution of India. 10. Sri.George Varghese (Perumpallikuttiyil), learned counsel W.A. Nos.80 & 83 of 2022 6 appearing for the writ petitioners/respondent Nos.1 & 2 in the writ appeal, would point out that the first writ petitioner/ 1[st] respondent in the writ appeal is a senior citizen, aged more than 86 years, and that in case this Court interferes with the impugned judgment of the learned Single Judge, then a direction may be issued to ensure that the matured proceeds of the fixed deposit amounts of at-least the first writ petitioner may be paid by the appellant. Taking note of the submission we have, earlier, requested the counsel for the appellant Bank to get instructions whether the matured proceeds of the fixed deposits held by the 1[st] appellant could be released to him, taking into account his advanced age and ailments. 11. Today, when the matter has been taken up for consideration, Sri.K.C. Santhosh Kumar, learned counsel appearing for the appellants, would submit on the basis of instructions that the appellant Bank would take necessary steps to ensure that the amounts due to the first writ petitioner, in terms of Exts.P1 to P5 fixed deposits, could be released to him without further delay and that this Court may make it clear that the same may not be treated as a precedent. 12. We place on record the submissions made by the appellants that taking into account the advanced age as well as the old age W.A. Nos.80 & 83 of 2022 7 ailments of the first writ petitioner the fixed deposit amounts due to him, in terms of Exts.P1 to P5, will try to pay him without much delay, preferably within 4 months, if it is financially feasible. Further, it is also made clear that the same may not be treated as a precedent. 13. As regards the 2[nd] writ petitioner, we are of the view that it is for him to seek the alternate statutory remedy by filing Arbitration Reference case in terms of Sec.69 of the Kerala Co-operative Societies Act. If such Arbitration Reference case is filed before the notified adjudicating authority, it may be ensured that the Arbitration Reference case, so filed by the 2[nd] writ petitioner, may be disposed of without much delay and after affording reasonable opportunity to both sides, it may be ensured that the award in the Arbitration Reference case may be rendered without much delay preferably within a period of 6 months from the date of filing of such Arbitration Reference case. The impugned judgment, rendered by the learned Single Judge on 26.08.2021, in W.P.(C) No.6094/2021 will stand modified and substituted as above. 14. In that regard, Sri.K.C. Santhosh Kumar, learned counsel appearing for the appellants, would point out that it is for the first writ petitioner to ensure that the fixed deposit receipts are immediately W.A. Nos.80 & 83 of 2022 8 submitted to the appellant Bank, so that the matured proceeds thereof could be credited to the Savings Bank account of the 1[st] writ petitioner. The 1[st] writ petitioner may take appropriate steps in that regard, as above. With these observations and directions, the above writ appeal will stand finally disposed of. ## **W.A. No.83 of 2022:-** This appeal is also broadly similar to the one in W.A. No.80/2022. 2. As a matter of fact, the learned Single Judge has rendered common judgment on 26.08.2021 in W.P.(C) No.6094/2021, which has led to W.A. No.80/2022 as well as in the instant W.P.(C) No.17879/2020, which has led to the instant W.A. No.83/2022. The appellant Bank is the same as the one involved in W.A. No.80/2022. In view of the aspects dealt with in the aforementioned judgment in W.A. No.80/2022, we are inclined to follow the same line of reasoning in this case as well. However, Sri.Manoj Ramaswamy, learned counsel appearing for the writ petitioners/respondents 1 to 3 in the W.A., would submit that the first petitioner is a senior citizen, aged 72 years, and that this Court may ascertain as to whether the matured proceeds W.A. Nos.80 & 83 of 2022 9 of the Fixed Deposit held by him could be paid without much delay. 3. Sri.K.C.Santhosh Kumar, learned counsel appearing for the appellant Bank, would submit on the basis of instructions that taking note of the advanced age of the 1[st] writ petitioner herein, efforts will be taken by the appellant Bank to ensure that the matured proceeds of the Fixed Deposits, held by the 1[st] writ petitioner, would be paid in installments without much delay, preferably within a period of 6 months or so, if it is financially viable for the Bank. 4. The said submission of the appellant Bank is recorded. 5. Further that, it is for the 1[st] writ petitioner to furnish their Fixed Deposits receipts to the appellant Bank, etc. It is for the 1[st] writ petitioner and the appellants to ensure that necessary steps in that regard are taken and we make it clear that the said payment is not on the basis of the directions issued by us, in this judicial proceedings, but only on the basis of the voluntary submission made by the appellant Bank. 6. In view of the aspects dealt with in the judgment in W.A. No.80/2022, it is ordered that the other writ petitioners may file Arbitration Reference case under Sec.69 of the Kerala Co-operative Societies Act, before the notified adjudicating authority, for return of W.A. Nos.80 & 83 of 2022 10 the money covered by the matured fixed deposits, held in their favour, and the adjudicating authority may ensure that award may be rendered in such AR(C) proceedings, without much delay, preferably within 6 months. 7. The impugned orders and directions of the learned Single Judge in the impugned judgment in W.P.(C) No.17879/2020 will stand modified and substituted as above. With these observations and directions, the above writ appeal will also stand disposed of. Sd/- **ALEXANDER THOMAS, JUDGE** Sd/- **SHOBA ANNAMMA EAPEN, JUDGE** Skk//09062022