GREATER BOMBAY CO-OP. BANK LTD. versus M/S UNITED YARN TEX. PVT. LTD. & ORS.

Citation: [2007] 4 S.C.R. 823 · Decided: 04-04-2007 · Supreme Court of India · Bench: B.N. AGRAWAL · Disposal: Reference answered

Cited by 2 judgment(s) · cites 2 · see the full citation network in Lexace

Judgment (excerpt)

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GREATER BOMBAY C()..()P. BANK L lD. 
A 
v. 
MIS UNITED YARN TEX. PVT. L lD. & ORS. 
APRIL 4, 2007 
[B. N. AGRAWAL, P.P. NAOLEKARAND 
B 
LOKESHWAR SINGH PANT A, JJ.} 
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Constitution of India, 1950: 
Seventh Schedule, List /!-Entry 32-List /-Entries 43 and 45-He/d, c 
Co-operative Banks are not covered by Entry 45 of List /, dealing with 
'banking'-Entry 43, List I dealing with banking, financial corporation etc., 
expressly excludes co-operative societies from its ambit-Subject of Co-
operative Societies is covered under Entry 32 of List II-Co-operative forms 
a specie of genus 'corporation', and as such co-operative societies, with D 
objects. not confined to one State read in with the Union as provided in Entry 
.; 
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44 of List I, MSCS Act, 2002 governs such multi state co-operatives-
Maharashtra Co-operative Societies Act, 1960-Andhra Pradesh Co-operative 
Societies Act, 1 964-Mu/ti State Co-operative Societies Act, 2002-Recovery 
of Debts Due to Banks and Financial Institutions Act, 1993- Banking 
Regulation Act, 1949. 
E 
Doctrine of occupied field-Held, co-operative Societies cannot be 
said to have been c .. vered by centra/legislation by reference of Entry 45, List 
1 
Doctrine of pith and substance-Held, a co-operative bank is not a F 
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'banking company' under s.5(c) of B.R. Act- Even if the co-operatives are 
involved in activity of banking which involves lending and borrowing, this 
is purely incidental to their main co-operative activity which is a function 
in public domairr-Banking Regulation Act, 1949-s.5(c). 
Co-operative Societies: 
G 
Co-operative Banks-Recovery of dues of-Applicability of RDB Act-
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Held, dues of co-operative societies and recovery proceedings in connection 
therewith are covered by specific Acts, namely, MCS Act, 1960, APCS Act, 
823 
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824 
SUPREME COURT REPORTS 
[2007) 4 S.C.R. 
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A 1964 and MCSC Act, 2002, which are comprehensive and self-contained 
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legislations-Even if co-operative banks are involved in certain banking 
activities of lending and borrowing, this is purely incidental to their main 
, 
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co-operative activity which is a function in public domain-Therefore, 
provisions of RDB Act, by invoking doctrine of incorporation are not 
B 
applicable to recovery of dues by co-operatives from their members-
Maharashtra Co-operative Societie~ Act, 1960-Andhra Pradesh Co-operative 
Societies Act, 1964- Mu/ti State Co-operativ_e Socif!ties Act, 2002 Recovery 
of Debts Due to Banks and Financial Institutions Act, 1993- Banking 
"': 
Regulation Act, 1949-/nterpretation of Statutes- Doctrine of incorporation. 
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c 
Maharashtra Co-operative Societies Act, /960/Andhra Pradesh Co-
operative Societies Act, 1964: 
S.91/ss. 61, 62, 70 and 71-Registrar or an officer designated by him 
or an arbitrator not 'civil courts'. 
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D 
'Banking Regulat~on Act, 1949: 
S. 5(c)-"Banking Company"-Held, "Co-operative banks" established 
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under MCS Act, 1960; APCS Act, 1964 and MSCS Act, 2002, transacting the 
business of banking do not fall within' the meaning of 'banking company' as 
defined fn s.5(c) of the B.R. Act. 
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Words and Phrases: 
'Court '-Connotation of in the context. of RDB Act, 1993. 
Co-operative banks established und~r the Maharashtra Co-operative 
F Societies Ad, 1960 (MCS Act, 1960), the Andhra Pradesh Co-operative 
Societies Act, 1964 (APCS Act, 1964) and the Multi-State Co-operative 
Societies Act, 2002 (MSCS Act, 2002), advanced loans to the respondent 
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Companies which were the members of the respective Co-operative Societies. 
When the Co-operative Banks sought to recover their dues, writ petitions 
were filed before tbe High Courts cllallenging the jurisdiction of he authorities 
G under the respective Co-operative Societies Act to recover the dues. The Full 
Bench or the Bombay High Court held that on and· from the date the Debts 
Recovery Tribunal was constituted un~er the Recovery or Debts Due to Banks 
and Financial Iristitutions Act, 1993 (RJ>B Act, 1993), the Courts and 
authorities under the Co-operative Societies Acts would cease to have 
),:'. 
H jurisdiction to entertain ;:pplications submitted by Co-operative Banks for 
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GREA TEll BOMBAY C~P. BANK L TI>. v. VNJTED Y AAN TEX. PVT. L m. 
825 
recovery of their dues. Similarly, the Full Bench of the Andhra Pradesh High A 
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Court held that the Tribunal constituted under the RDB Act had exclusive 
jurisdiction, p

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