Proprietor,Mr. K. Bharathveer Kothuru v. the Arbitrator, Office of the Deputy
Case brief
What is this about?
The High Court held that cooperative banks are 'banking companies' under the RBI Act and the RDBFI Act. Consequently, the power to regulate their banking business and recover dues falls exclusively within the Union's legislative competence under Entry 45 of List I. Provisions in the State Cooperative Societies Act allowing the Registrar to adjudicate such debts are ultra vires and void. The Court allowed Writ Petitions, quashing the impugned certificates and declaring the Tribunal the exclusive forum for such disputes.
What did the court decide?
Writ Petitions and Appeals allowed. Sections of the State Co-operative Societies Act read down to exclude jurisdiction over cooperative bank debts. Registrar's certificates regarding such debts quashed and declared void. Directions given to follow the exclusive jurisdiction of the Debt Recovery Tribunal.