Bombay High Court on Maintainability of Civil Suit under Maharashtra Co-operative Societies Act, 1960.

The Bombay High Court allowed a Civil Revision Application challenging the rejection of a plea for dismissal of a civil suit under Order VII, Rule 11(d) of the Civil Procedure Code. The Court held that a civil suit challenging actions taken under the Maharashtra Co-operative Societies Act, 1960 (MCS Act) — including attachment and auction of property in recovery proceedings — is barred under Sections 163 and 164 of the MCS Act. Since the plaintiff’s predominant cause of action arose from the society’s auction notice under Section 101 of the MCS Act, the plaint was liable to be rejected. The Court emphasized that failure to comply with statutory requirements, including mandatory notice under Section 164, bars maintainability of such suits in civil courts.

1. The petitioner, Kalika Nagri Sahakari Patsanstha Maryadit (the “Society”), disbursed a loan in 2007 to a member, Priyanka Amit Deshmukh, with respondent no.2 acting as guarantor.
2. The borrower defaulted, and the Society initiated recovery proceedings under Section 101 of the MCS Act, obtaining a recovery certificate for Rs. 3,38,961.
3. The Society attached the guarantor’s property and issued an auction notice dated 03.01.2024.
4. Respondent no.1 filed a civil suit (Regular Civil Suit No. 157 of 2024) challenging the auction and attachment, claiming no connection with the Society or the loan.
5. The Society filed an application under Order VII, Rule 11(d) CPC for rejection of the plaint on the grounds that the suit was barred under Sections 163 and 164 of the MCS Act and lacked mandatory notice.
6. The trial court rejected the Society’s application, prompting the present Civil Revision Application.

1. Section 163(3) MCS Act: Bars civil or revenue courts from entertaining suits challenging orders, decisions, or awards under the MCS Act.
2. Section 164 MCS Act: Requires mandatory notice to the society before filing a suit regarding its business; the plaintiff had not issued any notice.
3. The predominant cause of action for all prayers in the plaint was the auction notice dated 03.01.2024.
4. Challenge to a 31-year-old mutation entry did not constitute a separate cause of action.
5. The trial court erred by not giving effect to statutory bars and misreading Section 9 CPC regarding barred jurisdiction.
6. Reliance was placed on precedents including Satguru Construction Co. Pvt. Ltd. v. Gr. Bombay Co-operative Bank Ltd. (2007 (5) All M.R. 628) and Devgiri Nagari Sahakari Bank Ltd. v. Zubidabegum (2012 (7) All M.R. 571).

1. Section 9, Civil Procedure Code, 1908: Courts shall try all civil suits except those expressly or impliedly barred.
2. Order VII, Rule 11(d), CPC: Rejection of plaint where the suit appears barred by law.
3. Sections 101, 154, 156, 163 & 164, Maharashtra Co-operative Societies Act, 1960: Recovery of dues, revisionary powers, attachment and sale of property, bar of jurisdiction, and mandatory notice before suit.
4. Rule 107 of MCS Rules: Detailed procedure for execution of recovery certificates.

1. Civil Revision Application Allowed.
2. Order below Exhibit-15 in Regular Civil Suit No.157 of 2024 quashed and set aside.
3. Application for rejection of the plaint under Order VII, Rule 11(d) allowed.
4. Pending civil applications, if any, disposed of.

Citation: 2025:BHC-AUG:29932

Case: Kalika Nagri Sahakari Patsanstha Maryadit v. Vitthal Marayan Lakhpati & Ors.

Court: High Court of Judicature at Bombay, Bench at Aurangabad

Coram: Justice Ajit B. Kadethankar

Civil Revision Application No.: 162 of 2024