Authority: Supreme Court of India (Civil Appeal No. ____ of 2026, Special Leave Petition (C) Nos. 16144‑16146 of 2026)

Order Date: 7 August 2026

Case Overview

  • Parties: Appellants Tulsi Bhagwan Shetty & another (guarantors) vs. Abhyudaya Co‑operative Bank Ltd. and others.
  • Background: The appeals stem from a High Court judgment dated 27 Jan 2026 that set aside a Joint Registrar order dated 18 Jul 2006 because the pre‑deposit required under Section 154(2A) of the Maharashtra Co‑operative Societies Act, 1960 was not complied with.
  • The guarantors had earlier alleged that the Deed of Guarantee (1998) and related loan documents (Term Loan Rs 10 lakh, Cash Credit Rs 10 lakh) were forged, a plea first raised on 15 Oct 2000 and 10 Nov 2000.
  • The Assistant Registrar’s order on 15 May 2002 led to issuance of a Recovery Certificate on 29 May 2002, despite the forgery claim.
  • Revision Applications Nos. 405/2002 and 406/2002 before the Joint Registrar accepted the forgery contention, quashing the Recovery Certificates dated 15 May 2002.
  • The High Court later set aside the Joint Registrar’s order on jurisdictional grounds (non‑compliance with pre‑deposit).
  • The Supreme Court, after hearing counsel, observed that the fraud allegation was not merely an unfounded argument and that the Joint Registrar had examined the matter in detail.

Final Outcome

  • The Supreme Court set aside the Assistant Registrar’s order dated 15 May 2002, the Joint Registrar’s order dated 18 Jul 2006, and the High Court order dated 27 Jan 2026.
  • The matter is remitted to the Assistant Registrar of Cooperative Societies for fresh consideration, with a mandatory hearing for both appellants and respondents.
  • The Assistant Registrar is directed to dispose of the petition within two months from the date of this order.
  • The Court limited its determination to the rights and liabilities of the guarantors and expressly refrained from expressing any opinion on the merits of the forgery claim.
  • The civil appeals are disposed of, and any pending interlocutory applications, if any, are also disposed of.

Topics: Legal Remedy, Co‑operative Banking