Patna High Court
Brajesh Kumar SinghversusThe State Of Bihar and Ors
- Decided
- Disposal
- ALLOWED
- Bench
- A ABHISHEK REDDY
Holding
Certificate proceedings against the petitioner in his personal capacity are beyond jurisdiction and must be quashed.
Summary
The petitioner, Brajesh Kumar Singh, challenged certificate proceedings initiated against him personally under the cooperative banking law, contending that the loan was granted by the Sasaram Bhabhua Central Co-operative Bank as a juristic entity and not personally guaranteed by him. The court examined prior decisions, notably Nawal Kishore Pd. Singh v. State of Bihar (2006) and Kanhaiya Lal v. State of Bihar (2022), which held that officials acting in their official capacity cannot be sued personally for corporate liabilities. It was held that the certificate proceedings against the petitioner in his individual capacity lacked jurisdiction and were therefore invalid. Consequently, the certificate case No. 06/2016‑17 was quashed as against the petitioner. The writ petition was allowed to the extent indicated, directing that any further action must be directed against the corporate entity or its current office bearers, not the individual petitioner.
Issues considered
- Can certificate proceedings under the cooperative banking Act be instituted against individuals acting in their official capacity?
- Does the absence of a personal guarantee render the certificate proceedings against the petitioner void of jurisdiction?
- Is the order under Section 10 of the Act rejecting the petition under Section 9 legally valid?
Legislation cited
- Co-operative Societies Act — s. 10, 9
Subjects
- certificate proceedings
- juristic entity
- corporate liability
- cooperative bank
- writ petition
- quash
- official capacity
Judgment
IN THE HIGH COURT OF JUDICATURE AT PATNA
Civil Writ Jurisdiction Case No.12476 of 2017
======================================================
Brajesh Kumar Singh S/o Bipin Bihar Singh, R/o Village- Hurka, P.O.-Hurka,
P.S.-Tilauthu, District-Rohtas.
... ... Petitioner/s
Versus
1. The State Of Bihar.
2. The District Magistrate, Rohtas.
3. The District Certificate Officer, Rohtas, Sasaram.
4. The Sasaram Bhabhua Central Co-operative Bank, Sasaram, Rohtas through
its Managing Director.
5. The Managing Director, Sasaram Bhabhua Central Co-operative Bank,
Sasaram, Rohtas-cum-Certificate Officer.
6. The Branch Manager, Sasaram Bhabhua Central Co-Operative, Tilauthu,
Branch, Tilauthu, Rohtas.
... ... Respondent/s
======================================================
Appearance :
For the Petitioner/s : Mr. Jay Prakash Singh, Advocate.
For the Respondent/s : Mr. Mr. Mahendra Prasad Verma, AC to SC 20.
For the Bank : Mr. Bindhyachal Rai, Advocate.
======================================================
CORAM: HONOURABLE MR. JUSTICE A. ABHISHEK REDDY
ORAL ORDER
10 02-04-2026 Learned counsel appearing on behalf of the petitioner
submits that the matter is squarely covered by the Judgment of
this Hon’ble Court passed in CWJC No. 474 of 2024 dated
11.12.2024.
2. Learned counsel appearing on behalf of the
Respondent-Bank fairly submits that the above reported
judgment is applicable to the facts of the present case.
3. This Court in the above mentioned CWJC relying
Patna High Court CWJC No.12476 of 2017(10) dt.02-04-2026
2/3
on the judgment in the case of Nawal Kishore Pd. Singh vs.
State of Bihar reported in 2006 (3) BLJ 676 and in the case of
Kanhaiya Lal V. State of Bihar reported in 2022 (2) PLJR 553
has held as under: -
“5. This Court in the case of
Nawal Kishore Pd. Singh vs State of Bihar
reported in 2006 (3) BLJ 676 under similar
circumstances has held as under:-
“However, in view of the fact
that the said purported agreement, which
has been executed, has been executed by
the petitioners in their official capacity,
there cannot be any dispute that they
cannot be proceeded in their individual
capacity. Loan was granted by the
Central Cooperative bank to the
Transport Cooperative Society. Both are
juristic entities. It was not a loan
personally granted to the petitioners nor
was any such loan personally guaranteed
by the petitioners nor the petitioners
stood surety for the said loan.
4. In that view of the matter,
the entire certificate proceedings as
against the petitioners in their individual
capacity is wholly without jurisdiction
and is liable to be quashed. The order
passed under Section 10 of the Act
rejecting the petitioners’ petition under
Section 9 of the Act denying liability is
erroneous on the face of it. It has no
legal sanctity. The same is liable to be
quashed and is quashed in so far as it
relates to the petitioners in their personal
capacity is concerned. It will be open to
the Central Cooperative Bank to
Patna High Court CWJC No.12476 of 2017(10) dt.02-04-2026
3/3
substitute the names by names of the
present office bearers who again, it is
made clear, would not be liable in their
personal capacity. It is elementary that a
Corporate entity cannot by itself stand up
in Court proceedings. It has to act
through a person. It is only for that
limited purpose, the names of office
bearers would be there in the certificate
proceedings.”
6. Likewise a Division Bench of
this Hon'ble Court in the case of Kanhaiya
Lal v. State of Bihar reported in 2022(2)
PLJR 553 has held as under:-
“... which has examined a
similar matter and held that the
certificate proceedings against the
Directors of a Company incorporated
under the provisions of Companies Act
could not lie as the Company has an
independent juristic Corporate entity.”
4. Having regard to the law laid down by this Court,
the Certificate Case No. 06/2016-17 stands quashed as against
the petitioner herein.
5. With the above directions, the present writ petition
stands allowed to the extent indicated.
(A. Abhishek Reddy, J)
shakir/-
U
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