-1- DB Civil Writ (PIL) Petition No.26/2013 (Sajjan Singh Bhati v.
State of Rajasthan & Ors.) Date of Order :: 18th March, 2015 HON'BLE MR.JUSTICE GOVIND MATHUR HON'BLE MR.JUSTICE ANUPINDER SINGH GREWAL Mr.S.P.Sharma, for the petitioner.
Mr.S.S.Ladrecha, for the State.
Mr.Pramod Swaroop ].Dr.
Sandeep Singh ].Ms.Pareena Swaroop ].Mr.Vikas Balia ].Mr.M.S.Singhvi ].Mr.Vineet Dave ].Mr.Anjay Kothari ].Mr.Mahesh Bora ].Mr.Nishant Bora ].Mr.Pankaj Sharma ].Mr.Ravi Bhansali ].Dr.
Nupur Bhati ].for the respondents...The petitioner, a practicing Advocate, has preferred this petition for writ to have direction for the respondents to issue necessary guidelines to ban financial and banking activities carried out by various Credit Cooperative Societies including the respondents Nos.9 to 13.
On 19.11.2014, noticing the facts averred in the petition for writ, this Court by relying upon the judgment of Hon'ble Supreme Court in Apex Co-operative Bank of Urban Bank of Maharashtra and Goa Ltd.v.Maharashtra State Co.operative Bank LTD.& Ors., reported in AIR2004SC141 passed an interim order in following terms :- “As an interim measure, until further ordeRs.the Central Registrar, Multi-State Cooperative Society, New Delhi, the Registrar, Cooperative Society, Rajasthan, Jaipur, the District CollectORS.Barmer, Jaisalmer and Jodhpur and Director General of Police, Rajasthan will ensure -2- that respondents Nos.9 to 12 or any other Multi- State Cooperative Society or the State Cooperative Society do not carry on any banking business in the State of Rajasthan, unless they have a licence under the Banking Regulation Act, 1949.
These cooperative societies will not be allowed to carry on banking business namely, to take deposits, opening branches for its banking activities, installation and running of ATMs and distributing loans to the depositORS.The respondents will not allow any banking business by the Multi-State Cooperative Society and the District Cooperative Society unless they have licence from the Reserve Bank of India under the Banking Regulation Act, 1949.”
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As desired under the order aforesaid, a reply to the writ petition has already been filed by the Reserve Bank of India stating therein that “the role of the RBI in the regulation and supervision of co-operative societies is limited to those of “co-operative banks”.Co-operative societies that are not accepting deposits from the public (non-membeRs.do not fall within the regulatory purview of RBI.
However, those co-operative societies that are carrying on the business of “banking”.
are required to obtain a license from RBI.
RBI does not have any information regarding the business carried on by respondent Nos.9 to 12.”
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Today the matter came up before us on the applications preferred by some of the cooperative societies seeking modification of the directions given on 19.11.2014.
At the threshold Shri M.S.Singhvi, learned counsel appearing on behalf of respondent Sanjivani Credit -3- Cooperative Society Ltd., states that conduct of the petitioner disentitles him to approach this Court by claiming this petition for writ in public interest.
We are not inclined to entertain the preliminary objection raised being already considered and decided by this Court on 19.11.2014.
In the order aforesaid this Court arrived at the conclusion that the petitioner has not approached the Court with any ulterior motive or ill-will.
Shri Ravi Bhansali, learned counsel appearing on behalf of respondent Union of India submits that the Registrar, Cooperative Societies, New Delhi has already initiated inspection of the respondent cooperative societies except the respondent No.11 to ensure that the societies may not undertake banking activities or any activity i.e.not in consonance with the applicable by-laws and the provisions of Multi State Cooperative Societies Act, 2002.
Learned counsels appearing on behalf of the respondents Nos.9 to 13 states that the cooperative societies are neither involved in banking activities nor intend to do so.
According to them the activities of the societies are confined to the projects necessary for achieving aims and objects accepted in their by-laws.
On behalf of the respondent No.13, it is stated that the society is involved purely in socio economic activities pertaining to its membeRs.The society never issued any advertisements introducing its activities to -4- public at large.
According to learned counsels the respondents Nos.1 to 8 are not permitting the cooperative societies even to carry on activities for which they are legally entitled as per applicable by-laws, the Multi State Cooperative Societies Act, 2002 and the Rajasthan Cooperative Societies Act, 2001, as the case may be.
We have considered the arguments advanced.
The petitioner has approached this Court to stop banking activities by the respondent cooperative societies who are not having requisite licence as per provisions of the Banking Regulation Act, 1949.
Some of the advertisements published in different news papers on behalf of respondents Sanjivani Credit Cooperative Society LTD.and Navjivan Credit Cooperative Society LTD.indicate about involvement of the societies in banking activities, however, at this stage we do not want to give any definite finding in this regard but certainly we desire to record our displeasure about such misleading publicity undertaken by the societies.
We are also of considered opinion that the respondent societies are not entitled to undertake any banking activity without having licence under the Act of 1949.
Looking to the factual position noticed above we deem it appropriate to dispose of the applications with following directions as interim measures :- 1.No Multi State Cooperative Society or any other cooperative society created and registered under the -5- Multi State Cooperative Societies Act, 2002 or any other State legislation including the Rajasthan Cooperative Societies Act, 2001, as the case may be, shall carry on “banking”.
activity as defined under Section 5(b) of the Banking Regulation Act, 1949; 2.The respondents Nos.9 to 13 (except the respondent No.11) shall be at liberty to carry on their activities as per applicable by-laws.
While doing so, the cooperative societies shall ensure absolute compliance of the provisions of Multi State Cooperative Societies Act, 2002 including prohibitions and restrictions given therein; 3.The respondent No.11 shall be at liberty to carry on its activity as per applicable by-laws.
While doing so, the society shall ensure absolute compliance of the provisions of the Rajasthan Cooperative Societies Act, 2001 including prohibitions and restrictions given therein; 4.The respondent cooperative societies shall confine their activities within the scope of applicable by-laws among their existing members only.
If any cooperative society desires to provide its membership to any person, then that shall examine eligibility of such person as per applicable law and grant that by recording satisfaction of the competent authority to do so; 5.The respondent cooperative societies may publish or otherwise exhibit their activities by issuing advertisements but those shall be only for use and -6- consumption of their membeRs.No advertisement shall be issued by any of the respondent cooperative society to allure public at large to become its member or to avail benefit of its scheme without getting such advertisement approved by the Registrar, Multi State Cooperative Societies or the Registrar, Rajasthan State Cooperative Societies, as the case may be; 6.The Directors and other elected/nominated/appointed office bearers of the respondent cooperative societies shall furnish details of their identity, addresses and property (immovable as well as movable) to Deputy Registrar (Judicial) of this Court within a period of 15 days from today; and 7.The Registrar Multi State Cooperative Society, New Delhi and the Registrar, Cooperative Societies Rajasthan shall ensure compliance of the directions given by periodical inspection of the record of the respondent cooperative societies falling within their jurisdiction and also to report this Court about their functioning.
Put up on 20.04.2015.
(ANUPINDER SINGH GREWAL),J.
(GOVIND MATHUR),J.
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