PANDURANG GANPATI CHAUGULE v. VISHWASRAO PATIL MURGUD SAHAKARI BANK LIMITED

From the Judgment and Order dated 13.08.2008 of the High Court of Judicature at Bombay in First Appeal No. 1481 of 2008. With Civil Appeal Nos. 5684, 5682, 5681, 5675 of 2009, 10871, 4391, 7410 of 2010, 2384, 2385, 2386, 2387-2390, 2391-92, 2393-2394, 2395, 2396-2397, 2398, 2399, 2400, 2401, 2402, 2403, 2404, 2405, 2406 of 2020, C.C. No. 7586 of 2014, W.P. (C) Nos. 318 of 2010, 41, 220, 293, 306, 338, 375 of 2011, 122, 199, 250, 291, 386, 487, 537, 554 of 2012, 36, 146, 138, 179, 192, 191, 112, 111, 151, 175, 181, 201, 233, 236, 238, 253, 250, 248, 271, 265, 270, 279, 266, 280, 284, 353, 469, 452, 588, 758, 762, 761, 800, 753, 819, 922, 1007, 1037, 1044, 1043, 1045 of 2013, 5, 10, 40, 142, 169, 168, 352, 408, 420, 421, 492, 712, 714, 795, 754, 827, 849, 838, 1020 C D E F G H PANDURANG GANPATI CHAUGULE v. VISHWASRAO PATIL MURGUD SAHAKARI BANK LIMITED 1053 of 2014, 26, 86 of 2015, 1035, 1232, 1355, 1331, 1339, 1353 of 2019, 31, 62, 72, 134, 207, 271, 289, 292, 373 of 2020. A Tushar Mehta, SG, Jayant Muthraj, Jaideep Gupta, Shekhar Naphade, Vijay Hansaria, Vinay Navare, Ritin Rai, Sr. Advs., Mahesh Agarwal, Ankur Saigal, Vikrant Pachnanda, Utkarsh Pratap, E.C. Agrawala, Devansh A. Mohta, Shishir Deshpande, Amit Yadav, Nilakanta Nayak, Ms. Sujata Kurdukar, Mrigank Prabhakar, Ms. Sakshi Banga, Gautam Prabhakar, Gaurav Nair, Ms. Sanika Mehra, Ms. Pranati Bhatnagar, Kritya Sinha, Varun Singh, Vikas Mehta, Apoorv Khator, Rajat Sehgal, Satpal Singh, Ms. Seema Thapliyal, Jaimon Andrews, K. Prajagopal, Piyo Harold Jaimon, Sandeep Thakur, Naresh Kumar, Zaid Ali Subzposh, Tamim Qadri, Lakshmi Raman Singh, Vineet Bhagat, Nikhil Goel, S.K. Kulkarni, M. Gireesh Kumar, Ankur S. Kulkarni, M.P. Vinod, Atul Shankar Vinod, Dileep Pillai, Ajay Kumar Jain, Sajith P., Kannan Gopal Vinod, Chinmoy Khaladkar, Sanjay Kharde, Ms. Chandan Ramamurthi, Pradhuman Gohil, Mrs. Taruna Singh, Ms. Ranu Purohit, Ms. Tanya Srivastava, Ms. Charu Mathur, Yadav Narender Singh, Ms. E.R. Sumathy, Sarad Kumar Singhania, Ms. Vanshaja Shukla, Rameshwar Prasad Goyal, H. Chandra Sekhar, Mrs. Rekha Chandra Shekhar, Karri Venkata Reddy, Chirag M. Shroff, Ms. Yashika Verma, Ms. Abhilasha Bharti, M.A. Chinnasamy, Arvind Gupta, Sandeep Kumar Singh, Anil Kumar Sahu, Prakash Gautam, Sujeet Kumar, J.N. Pathak, Sunil Kumar Pandey, Amol Nirmalkumar Suryawanshi, S. Sada Siva Reddy, Karri Venkata Reddy, S. Usha Reddy, Santosh Krishnan, Ms. Rakhi Ray, Abhay Kumar, M.J. Paul, Renjith B., Lakshmi N. Kaimal, Jayakrishnan U., Mahendra Kumawat, Subodh S. Patil, Ms. Supriya Patil, Ajay Kumar Singh, Garvesh Kabra, Mrs. Pooja Kabra, Ms. Nikita Kabra, Harshvardhan Jha, Anup Lohiya, Adarsh Upadhyay, Abhishek Chaudhary, Anurag Kishore, Mridula Kanti Sinha, S.K. Rajora, Ms. Mamta Upadhyaya, Kusum Chaudhary, Atul Babasaheb Dakh, Mrs. Pragya Baghel, Ajay Majithia, Satyajit A. Desai, Ms. Anagha S. Desai, Bankey Bihari Sharma, Rabin Majumder, Abhishek Agarwal, A. Venayagam Balan, Gaurav Agrawal, Bharat L. Gandhi, Mrs. Vithika Garg, Ms. Vidushi Garg, Ms. Karishma Singhal, Ms. Garima Prashad, Suresh Chandra Tripathy, Anirudh Sanganeria, Karunakar Mahalik, B. Vishwanath Bhandarkar, Sarbendra Kumar, Upendra Narayan Mishra, Durga Dutt, Prakash Sharma, Dilip Annasaheb Taur, Rajul Shrivastav, Mohit D. Ram, Ms. Monisha Handa, Sachin Kaushal, Bhagirath N. Patel, Rajat Nair, Ms. Swati Ghildiyal, Akshay Amritanshu B C D E F G H 1054 SUPREME COURT REPORTS [2020] 5 S.C.R. A.K. Sharma, Shubham Saurav, Ms. Vanshaja Shukla, Kuldeep S. Parihar, H.S. Parihar, Ms. Ikshita Parihar, Shivaji M. Jadhav, Nicholas Choudhary, Aditya P. Khanna, Aditya S. Jadhav, Shiv Ram Pandey, S. Lakshmi Iyer, Ms. Aishwarya Dash, Chinmoy Khaladkar, (for M/s. S.M. Jadhav and Company), Rutwik Panda, Ms. Nikhar Berry, Ms. Anshu Malik, M.Y. Deshmukh, Ms. Manjeet Kirpal, Avanish Pandey, Ms. Sneha Kalita, Gwen Karthika, Ms. Abha R. Sharma, P.S. Sudheer, Rishi Maheshwari, Mrs. Mayuri Nayyar Chawla, Ms. Anne Mathew, Bharat Sood, Ms. Shruti Jose, Amar Dave, Vishwas K. Shah, Massom K. Shah, Anup Jain, Udit Gupta, Pulkit Tare, Ashok Panigarhi, Apoorv Kurup, Ms. Upama Bhattacharjee, Ms. Nidhi Mittal, Mrs. Anil Katiyar, Pratap Venugopal, Ms. Surekha Raman, Ms. Ayushi Gaur, Akhil Abraham Roy, Vijay Valsan, (for M/s. K.J, John and Co.), A.N. Arora, Piyush Sharma, M.T. George, Mrs. Susy Abraham, Johns George, Aniruddha P. Mayee, A. Rajarajan, Ms. N. Annapoorani, D. Bharat Kumar, Prasanna Kumar Parhi, Tadimalla Bhaskar Gowtham, Aman Shukla, D.V. Raghu Vamsu, Siddhartha Sinha, Hathindra Manda, Abhijit Sengupta, Anil Kumar Mishra, Ms. Praveena Gautam, Pawan Shukla, Ms. Sweety Pandey, Raja Ram, M. Khairati, Irshad Ahmad, Aniruddha Joshi, Rajeev Maheshwaranand Roy, Gunjan Kumar, P. Srinivasan, Navjeet Giri, Rajeev K. Panday, V.N. Raghupathy, Manendra Pal Gupta, S.N. Bhat, Ms. Hemantika Wahi, Chinmoy Khaladkar, Ms. Neha Sharma, Deeptakriti Verma, Rajiv Shankar Dwivedi, Ms. Anuradha Mutatkar, Ms. Usha Singh, Ms. Nidhi Saini, Siddharth Mittal, Arun Aggarwal, Ankur Prakash, Praveen Chaturvedi, Dr. Lalit Bhasin, Ms. Nina Gupta, Ms. Palak Chadha, Ms. Ruchika Joshi, P.V. Yogeswaran, Ms. Asha Gopalan Nair, Sudhanshu S. Choudhari, Rameshwar Prasad Goyal, Debmalya Banerjee, Kartik Bhatnagar, Rohan Sharma, A.S. Aman, Ujjwal Singh, Vandaan Wanchoo (for M/s. Karanjawala & Co.), Soumyajit Pani, Chittaranjan Singh (for Vinodh Kanna B.,), A. Venayagam Balan, P.I. Jose, Prashant K. Sharma, Jenis Francis, Ravi Sagar, Anupam Mishra, Hari Kumar V., Siddhesh Kotwal, Ms. Bansuri Swaraj, Nirnimesh Dube, Ms. Astha Sharma, Ms. Arshiya Ghose, Divyansh Tiwari, Ms. Ana Upadhyay, Rajesh Mahale, Arjun Krishnan, Ankur Singh, Shourya Bari, Aaditya A. Pande, Chander Shekhar Ashri, Chandrashekhar A. Chakalabbi, Awanish Kumar, S.K. Pandey, Anshul Rai (for M/s. Dharmaprabhas Law Associates), B.K. Pal, G. Prakash, Jishnu M.L., Mrs. Priyanka Prakash, Mrs. Beena Prakash, P.V. Dinesh, Uday B. Dube, Y. Raja Gopala Rao, Ms. Vismai Rao, Sanjeev Kumar, A B C D E F G H PANDURANG GANPATI CHAUGULE v. VISHWASRAO PATIL MURGUD SAHAKARI BANK LIMITED 1055 Pankaj Tikde, Sanjay Kumar, H.K. Naik, Rajnish K., Awanish Kumar, Ajay Amritraj, Arvind Kr. Sharma, Aniteja Sharma, Raj Kishor Choudhary, Rohit K. Singh, Uday Tiwary, P.N. Razdan, Mirza Kayesh Begg, Ms. Anshruta Maheshwari, Ms. Usha Nandini. V, Bineesh Karat, Biju P. Raman, M.S. Vishnu Sankar, Ms. Athira G. Nair, Sonal Jain, Kumar Shashank, Ms. Rukhmini Bobde, Aviral Kapoor, Ms. Shagufa Salim, Nivesh Kumar, Ms. Riya Dhingra, Satyavir Yadav, Vishal Prasad, Anil Nag, Arjun Vinod Bobde, Ms Richa Relhan, Sathak Bhatia, S. Bushra Kazim, Rajat Joseph, Suresh Dutt Dobhal, Anil Kumar Sangal, Harish Pandey, Ms. Pratibha Jain, Vijay Kumar, Dharmendra Kumar Sinha, Shashibhushan P. Adgaonkar, Rahul Chitnis, Sachin Patil, T.L.V. Rama Chari, Hitesh Kumar Sharma, Akhileshwar Jha, T. Ramamurty, Ms. Sushma Suri, Shreekant N. Terdal, Tanvir Nayar, Praful Sinha, Manoj Kr. Mishra, M/s. Udit Kishan Associates, Advs. for the appearing parties. The Judgment of the Court was delivered by ARUN MISHRA, J.

1. The matters have been referred in view of conflicting decisions in Greater Bombay Coop. Bank Ltd. v. United Yarn Tex (P) Ltd. and Ors.1, Delhi Cloth & General Mills Co. Ltd. v. Union of India and Ors.2, T. Velayudhan Achari and Anr. v. Union of India and Ors.3, and Union of India and Anr. v. Delhi High Court Bar Association and Ors.4. The question relates to the scope of the legislative field covered by Entry 45 of List I viz. ‘Banking’ and Entry 32 of List II of the Seventh Schedule of the Constitution of India, consequentially power of the Parliament to legislate. The moot question is the applicability of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short, ‘the SARFAESI Act’) to the co-operative banks.

2. The Parliament’s competence to amend Section 2(c) of the SARFAESI Act by adding sub-clause ‘(iva) - a multi-State co-operative bank’ has also been questioned. The issue arises whether the definition of ‘banking company’ contained in Section 5(c) of the Banking Regulation Act, 1949 (for short, ‘the BR Act, 1949’) covers co-operative banks registered under the State law and also multi-State co-operative societies