Bombay High Court
PARBEEN KHATUN AHMED KHAN AND ANRversusDIVISION JOINT REGISTRAR COOPERTIVE SOCIETIES AAND ORS
- Decided
- Disposal
- Disposed Off
- Bench
- SANDEEP V MARNE
Holding
The guarantors remain liable for the loan and the attachment order stands; the petition is dismissed.
Summary
The petitioners, who stood as guarantors for a loan taken by Mr. Pravin Kailashchandra Dubey, challenged an attachment order issued by the Assistant Registrar of Co-operative Societies on 13 October 2021. They did not contest the recovery certificate under Section 154(2A) of the Maharashtra Co‑operative Societies Act, arguing that a No‑Objection Certificate (NOC) had been issued by the credit society on 7 August 2019. The credit society denied the existence of such an NOC, stating that the loan remained outstanding and that it had only taken symbolic possession of the borrower’s asset. The court held that the guarantors remained liable for the debt and that the attachment order could not be set aside, allowing the society to proceed against them even before obtaining a court order for possession. It further clarified that any surplus recovered from the eventual auction of the borrower’s assets would be adjusted against amounts recovered from the guarantors. Consequently, the writ petition and the accompanying interim application were dismissed.
Issues considered
- Whether guarantors can avoid liability by not challenging the recovery certificate under Section 154(2A) of the Maharashtra Co‑operative Societies Act.
- Whether the alleged No‑Objection Certificate issued by the credit society extinguishes the guarantors' liability.
- Whether a credit society may proceed against guarantors for recovery of dues while the borrower’s asset is still under symbolic possession and pending auction.
- Whether the attachment order passed by the Assistant Registrar can be set aside on the grounds raised by the petitioners.
Legislation cited
- Maharashtra Co-operative Societies Act, 1960 — s. 154(2A)
Subjects
- guarantor liability
- co-operative societies law
- recovery certificate
- attachment order
- auction surplus adjustment
- Maharashtra Co-operative Societies Act
Judgment
2026:BHC-AS:27900
Megha 26_wp_3914_2026 with IA_2571_26
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO.3914 OF 2026
WITH
INTERIM APPLICATION NO.2571 OF 2026
IN
WRIT PETITION NO.3914 OF 2026
Parbeen Khatun Ahmed Khan and Anr. ...Petitioners
V/s.
Divisional Joint Registrar, Co-operative
Societies and Ors. ...Respondents
________________
Mr. Omprakash Dubey for the Petitioners.
Ms. M.S. Srivastav, AGP for Respondent -State.
Mr. Ajinkya A. Thakur for Respondent Nos.2 and 3.
________________
CORAM: SANDEEP V. MARNE, J.
DATED: 7 JULY 2026.
P.C.:
1) The Petition is @led by the guarantors challenging the order
passed by the Divisional Joint Registrar on 16 August 2024 (Divisional
Joint Registrar) dismissing their revision application and con@rming the
attachment order dated 13 October 2021 passed by the Assistant
Registrar, Co-operative Societies(Assistant Registrar) .
Page No.1 of 3
7 July 2026
Megha 26_wp_3914_2026 with IA_2571_26
2) I have heard Mr. Dubey, the learned counsel appearing for the
Petitioners, Ms. Srivastav, the learned AGP appearing for Respondent
No.1-State and Mr. Thakur, the learned counsel appearing for
Respondent Nos.2 and 3.
3) It appears that the Assistant Registrar has issued recovery
certi@cate dated 13 October 2021 against the borrower- Mr. Pravin
Kailashchandra Dubey and the Petitioners. The Petitioners have stood as
guarantors to the loan availed by the borrower. It appears that the
Petitioners did not challenge the recovery certi@cate dated 13 October
2021 before the Divisional Joint Registrar with a view to avoid deposit of
amount under sub-section (2A) of Section 154 of the Maharashtra Co-
operative Societies Act, 1960 (MCS Act). They conveniently challenged
only the attachment order. Be that as it may. The Petitioners contend
that a No Objection Certi@cate (NOC) was issued by the Respondent
No.2- Credit Society on 7 August 2019. However, it appears that the
Society has taken a plea that no such NOC was ever issued by it on
account of the fact that outstanding amount continued to be reBected in
the loan account.
4) Another contention sought to be raised before me is that the
Respondent No.2-Credit Society has already taken symbolic possession
of the borrower’s asset. However, as rightly contended by the learned
counsel appearing for Respondent No.2-Society that till the asset of the
borrower is sold, the Society is entitled to recover due amount from
guarantors. He has fairly submitted that in the event, any excess amount
Page No.2 of 3
7 July 2026
Megha 26_wp_3914_2026 with IA_2571_26
remaining balance after sale of the asset of the borrower, the same can
be adjusted against the amount recovered from the Petitioners.
5) It appears that Respondent No.2-Credit Society is yet to secure
order from Chief Judicial Magistrate for taking over possession of the
borrower’s property. It therefore cannot be contended that the
Respondent No.2-Society is precluded from proceeding against
guarantors for recovery of its amount even during pendency of
proceedings for conducting auction sale of borrower’s property.
6) Writ Petition is accordingly disposed of without granting any
relief in favour of the Petitioners. It is however, clari@ed that in the event
of Respondent No.2-Credit Society recovers excess amount by auction of
the assets of the borrower, the same shall be adjusted against the
amount recovered from the Petitioners.
7) In view of disposal of the Petition, nothing survives to be
adjudicated in the Interim Application, the same is accordingly disposed
of.
[SANDEEP V. MARNE, J.]
Signed by: Megha S. Parab
Page No.3 of 3
Designation: PA To Honourable Judge 7 July 2026
Date: 08/07/2026 14:56:04
Checking your session…