Greater Bombay Co-op. Bank Ltd vs M/s United Yarn Tex. Pvt. Ltd
Greater Bombay Co-op. Bank Ltd vs M/s United Yarn Tex. Pvt. Ltd. - Supreme Court Case Summary of Leading Case -
On 4th April, 2007, a three Judges Bench in Greater Bombay Co-op. Bank Ltd vs M/s United Yarn Tex. Pvt. Ltd. & Ors [Civil Appeal No. 432 of 2004] held that “Co-operative banks” established under the Maharashtra Co-operative Societies Act, 1960; the Andhra Pradesh Co-operative Societies Act, 1964; and the Multi-State Co-operative Societies Act, 2002 transacting the business of banking, do not fall within the meaning of “banking company” as defined in Section 5(c) of the Banking Regulation Act, 1949. Therefore, the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 by invoking the Doctrine of Incorporation are not applicable to the recovery of dues by the co-operatives from their members.”
“The field of co-operative societies cannot be said to have been covered by the Central Legislation by reference to Entry 45, List I of the Seventh Schedule of the Constitution. Cooperative Banks constituted under the Co-perative Societies Acts enacted by the respective States would be covered by co-operative societies by Entry 32 of List II of Seventh Schedule of the Constitution”, the Bench said.