Raising concerns over the deteriorating state of co-operative sector banks in Maharashtra, the Bombay High Court on Tuesday said the General Manager of the Rural Co-operative Banking Cell of the Reserve Bank of India (RBI) be made a party to a litigation seeking action against the pathetic condition of the Kolhapur District Central Co-operative (KDCC) Bank. The court felt the scope of the litigation could be widened to all co-operative sector banks instead of restricting it to the KDCC Bank. “Many co-operative sector banks are virtually sinking, this is very serious and we cannot keep our eyes closed in such a situation,” the court remarked. “Tell us if there is any co-operative sector bank which is earning profit because of its operations,” Justice BH Marlapalle asked the state government. Kolhapur-based activist Sunil Modi had filed the petition through his lawyer Uday Warunjikar stating that despite several inspections and audits indicating rampant malpractices in KDCC Bank, no criminal action had been initiated so far. Justice Marlapalle and Justice UD Salvi have asked the Registrar to file an affidavit stating measures taken by him against erring directors and officers of KDCC Bank. Warunjikar told the court that many directors of KDCC Bank happen to be influential politicians, either sitting or former ministers. “Probably, that is the reason why no action has been taken,” the court said. According to Modi’s petition, the liabilities of the bank had exceeded the value of its assets. The net worth of the bank was minus Rs 22.08 crore as on March 31, 2007. In 2008, the net worth of the bank had plummeted to minus Rs 157.79 crore. The case will be heard further on June 22.
IE
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