Shree Bhavnagar Nagrik Sahakari Bank Ltd. vs State of Gujarat and Others

Ravi R. Tripathi, J.—Rule. Learned advocate Mr. JT Trivedi for respondent No. 3 and learned Assistant Government Pleader Mr. Jirga Jhaveri waive service of process of Rule.

2 Heard learned advocate Mr. Joshi for the petitioner. The petitioner - Bhavnagar Nagrik Sahakari Bank Ltd. is before this Court through its Chairman/Manager being aggrieved by the priorities fixed by the liquidator of Shri Vardhman Co-operative Bank Ltd., a copy of which is produced at page 49.

Against the fixation of priorities, the petitioner preferred an appeal before the Registrar, Co-operative Societies, Gujarat State, Gandhinagar, who decided the appeal by judgment and order dated 5th February 2010 and rejected Appeal No. 79 of 2009. The learned advocate for the petitioner effectively demonstrated that the Additional Registrar (Appeals) has decided the appeal by stating therein that, ''the liquidator has not disallowed the claim of the applicant (present petitioner); that the applicant (present petitioner) is already included in the Priority List at serial No. 5'' and very cursorily, it is also mentioned in the order that, ''overall, the priorities fixed by the liquidator do not warrant any interference''. This is nothing but shirking of responsibility of deciding as to whether, the liquidator has rightly fixed the priorities or not. The Additional Registrar (Appeals) ought to have decided that, as to whether the priorities fixed by the liquidator are properly fixed or not.

Against the order of Additional Registrar (Appeals), the petitioner approached the Deputy Secretary (Appeals), Agriculture and Co-operation Department, Gandhinagar, who too, dismissed the same and confirmed the order of Additional Registrar (Appeals) dated 5th February 2010. The learned advocate for the petitioner invited attention of the Court to the observations made by the Deputy Secretary (Appeals) that, ''taking into consideration the contents of Section 110-E of the Gujarat Co-operative Societies Act, there is no provision for hearing the applicant (present petitioner)''.

The right of hearing is to be read in every provision, where the authority decides the right of a person. In the present case, it is the liquidator who decided the right of the petitioner by putting the petitioner at serial No. 5 in the Priority List and by that, it adversely affected the right of the petitioner without affording any hearing to the petitioner. To such an order, the higher authorities - appellate authority has affixed the seal of approval by saying that, ''the liquidator has not disclaimed the claim of the petitioner'' and the Deputy Secretary (Appeals) has said that, ''there is no provision for hearing and therefore, the order of the Registrar, does not warrant any interference''.

In the opinion of this Court both these orders are suffering from ''non-application of mind'' and also ''ignorance of the settled position of law'' to the effect that, right of hearing is required to be read in every provision. Therefore, this petition deserves to be allowed. The Priority List at page 49, order passed by the Additional Registrar (Appeals), and order passed by the Deputy Secretary (Appeals) are quashed. The exercise of fixing the priority be undertaken afresh by the liquidator, after giving necessary hearing to all the concerned parties and priorities be fixed de novo.

At the request of learned Assistant Government Pleader Ms. Jirga Jhaveri it is clarified that quashing of these orders does not mean that the Court has pronounced anything on the claim of the petitioner. The only pronouncement is that the action of fixing the priorities by the liquidator without affording any hearing to the petitioner is unknown to law and therefore, it is quashed along with the order passed by the Additional Registrar (Appeals) and order passed by the Deputy Secretary (Appeals).

The petition is allowed. Rule is made absolute with no order as to costs. Direct service is permitted.

It goes without saying that when it comes to the Official Liquidator to decide the priorities, he will fix the priorities in accordance with law without being influenced by the factum of allowing of this petition.

If any respondent is aggrieved by this judgment and order then can approach this Court within three weeks from the date of service of this judgment.