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Judgment
A.A. Desai J.
The petitioners who are the cultivators and members of respondent No. 2-society collectively made a grievance against the making of special endorsement on the cheques being issued in their favour towards the price of cotton supplied to the society under the monopoly scheme.
According to them, the society makes an endorsement on the cheques while making payment as "account payee with District Co-operative Bank only."
The contention of petitioners is that in view of this special endorsement, they have to deposit the cheque only in District Co- operative Bank. They contended that sometimes there are no facilities in the bank. The main thrust of their grievance is that it is wholly illegal to impose any condition of depositing the cheque only in the District Co-operative Central Bank or its branches. They submitted that some of the cultivators are having the accounts in nationalised banks. However, owing to the endorsement they cannot make deposit in the said bank. This practice is malicious and has been adopted to harass the cultivators. Another submission of the petitioners is that most of the cultivators do not take loan from the societies and some of them take loans from nationalised banks. Compelling such persons to make deposit of the cheques only in the co-operative banks is unjust and unfair.
Mr. Dharmadhikari tried to support the practice contending that making such special endorsement is with a purpose to secure the loan availed of by the cultivator. He submitted that the loan which is advanced to the cultivators can be indemnified by making them deposit the amount of payment in the co-operative bank. The submission is wholly erroneous. As admitted before us, the payment is made to the cultivators as per the green card. The cheques are issued for an amount towards the price of the cotton after deducting the loan due as on that date. In view of this practice, the justification as tried to be canvassed is wholly erroneous.
Next submission of Mr. Dharmadhikari is that making such special endorsement is with a purpose to keep the money in co-operative movement or activity. As discussed, when the payment is released to the cultivator only after deduction of the loan, forcing them to keep such money payable to them in co-operative bank is totally without justification, unjust and unfair. Even otherwise, the society or the bank cannot achieve this purpose by imposing a condition to deposit a cheque in the co-operative bank. The cultivators after discharging their loan are entitled to deposit the money in any bank or are at liberty to utilize it as per their choice. Making special endorsement is without any authority of law and has no nexus with any legitimate purpose. The society has, therefore, been acting unreasonably and they are liable to desist from such practice. We, therefore, pass the following order:
The petition is allowed. The respondent-society is hereby directed to desist from making the special endorsement, namely, "account payee with the District Central Co-operative Bank only". The cheque for payments be hereafter issued to the cultivators by making only ordinary endorsement of "account payee". The respondent-society is further directed to adopt this practice within a period of two weeks from today and shall also pay the costs of the petitioners.