Bombay High Court

Avinash Rajaram Gawde M/S Avinash ... vs The Cosmos Co Operative Bank Ltd. And Ors on 25 September, 2025

2025:BHC-AS:40676-DB                                                         17-aswp-10838-2025+.doc




                                                                                                Shephali




                              IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                      CIVIL APPELLATE JURISDICTION
                                      WRIT PETITION NO. 10838 of 2025
                                                   WITH
                                   INTERIM APPLICATION NO. 31227 OF 2025
                                                    IN
                                      WRIT PETITION NO. 10838 of 2025


                    Avinash Rajaram Gawde,                                             ...Petitioner
                                                                                   (Org. Appellant)

                            ~ versus ~

                    1.    The Cosmos Cooperative Bank Ltd,
                          1st Floor, Horizon Bldg.,
                          Gokhale Road, Dadar (West),
                          Mumbai 400 028

SHEPHALI
                    2.    The Special Recovery Officer (SRO),
SANJAY                    Mr Devadatta H Sawant,
MORMARE
                          C/o The Cosmos Cooperative Bank Ltd.,
Digitally signed
by SHEPHALI
                          1st Floor, Horizon Bldg.,
SANJAY
MORMARE                   Gokhale Road, Dadar (West),
Date: 2025.09.26
10:26:50 +0530            Mumbai 400 028
                    3.    M/s GK Industries (HPLN 1321), Joint,
                          15, Surwe Industrial Estate Sonawala
                          Cross Lane No. 1, Goregaon (East),
                          Mumbai 400 063
                    4.    M/s GK Microtech (HPLN 784) Sole,
                          15, Surwe Industrial Estate Sonawala
                          Cross Lane No. 1, Goregaon (East),
                          Mumbai 400 063
                    5.    Mrs Rasika kishor Gawde,
                          As Partner of M/s. GK Industries and as
                          legal heir of Late Mr Kishor Shivram




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       Gawde, having address at:
       P.O.Box 775, 2020 Horns Point Road,
       Cambridge, MD 21613,
       United States of America
       Email: [email protected]
       Phone 410-221-8337
 6.    Mr Saurabh Kishore Gawde,
       As legal heir of Late Mr Kishore Gawde
       Having address at:
       733, Ne 14th St. Apt 9
       Okalhoma City, OK 73104
       United States of America
       Email: [email protected]
       Phone: 405-271-2085
 7.    Mrs Ketki Kishore Gawde
       W/o of Late Mr Kishore Gawde
       1, Pandey Mishra Chawl, Gogate Wadi
       Aarey Road, Goregaon (East),
       Mumbai 400 063.                                           ...Respondents

 A PPEARANCES
 For the Petitioner                  Mr Anil K Lulla, with Suchitra
                                     Singh, Riddhi Gupta & Pravin
                                     Palhade, i/b Jenny A Karakasia.
 For Respondents Nos. 1 & 2          Mr Vishal G Ghosalkar.



                               CORAM : SUMAN SHYAM &
                                       MANJUSHA DESHPANDE, JJ

                        RESERVED ON : 19th SEPTEMBER 2025.
                     PRONOUNCED ON : 25th SEPTEMBER 2025.

 JUDGMENT (Per Suman Shyam, J):

25th September 2025

17-aswp-10838-2025+.doc

1. The Petitioner herein stood as a guarantor in respect of a

loan availed by the borrower from Respondent No. 1, i.e., The

Cosmos Cooperative Bank Ltd. After the loan account had turned

into an NPA ("Non Performing Asset"), proceedings were initiated

to make recovery of the amount by attaching properties of the

borrower as well as the guarantor. Consequently, the possession of

the shop premises owned by the Petitioner was also sought to be

taken over by Respondent No. 1-Bank. At that stage, the Petitioner

had approached this Court by filing Writ Petition No. 10838 of

2025 inter alia offering to settle the amount with the Bank and

also to deposit a sum of Rs. 10 lakhs by 13 th August 2023. By

taking note of such projection made by the learned counsel

appearing for the Petitioner, on instructions from his client, this

Court (Coram: MS Karnik and NR Borkar, JJ) had passed an order

dated 6th August 2025 granting time to the Petitioner to deposit the

sum of Rs. 20 lakhs, out of which Rs. 10 lakhs was to be deposited

by 13th August 2025 and the balance amount within four weeks

from the date of that order.

2. Taking note of the submissions made by the learned counsel

for the Petitioner, by order dated 6th August 2025, this Court had

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17-aswp-10838-2025+.doc

restrained the Respondents from dispossessing the Petitioner,

subject, however, to the deposit of the amount. The matter was

fixed again on 21st August 2025. On that date, the Petitioner

sought extension of time to deposit the amount. By order dated

21st August 2025 (Coram: Suman Shyam & Shyam C Chandak, JJ),

time for depositing the amount was accordingly extended till 19 th

September 2025.

3. Today, when the matter is called up, it is pointed out that not

even a single penny has been deposited by the Petitioner in terms

of the assurance given to the Court. On the contrary, by filing the

Interim Application, the Petitioner/Applicant has sought interim

directions, alleging suppression of facts on the part of the

Respondent Nos. 1 and 2.

4. What would be significant to note herein that the Petitioner

has not denied that he was one of the guarantor to the loan nor

has he challenged the Certificate of recovery. Notwithstanding

same, the Petitioner is resisting the recovery proceedings by taking

one plea or the other.

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5. During the course of arguments Mr Lulla, learned counsel

appearing on behalf of the Petitioner submits that the Respondent

No. 1-Bank should be directed to first proceed against the property

of the borrower and also one of the active partners of the firm and

if any amount remains due and payable even thereafter, only in

that case, the Bank should be permitted to proceed against the

property of the Petitioner.

6. The said submission of the Petitioner's counsel has been

strongly opposed by Mr Ghosalkar, learned counsel appearing for

Respondents Nos. 1 and 2 who submits that law is firmly settled

that the liability of a guarantor /surety is co-extensive with that of

the debtor and, therefore, it is open for the Bank to proceed

against the mortgaged property, including the property belonging

to the Petitioner. In support of his above arguments, Mr Ghosalkar

has referred to the decision of of the Supreme Court in the case of

Ram Kishun & Ors vs State of UP & Ors1and Central Bank of India

vs CL Vimla & Ors2.

1 AIR 2012 SC 2288.

2 AIR 2015 SC 2280.

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7. As has been noted hereinabove, there is no dispute about the

fact that the Writ Petitioner was a guarantor in respect of the loan,

which had turned into an NPA. It is also not denied that the

certificate issued under Section 101 of the Maharashtra

Cooperative Societies Act, 1960 has not been challenged by any of

the parties till today.

8. The Petitioner has also failed to abide by his undertaking

given to the Court while obtaining the interim orders as noted

above.

9. In the case of Ram Kishun & Ors vs State of UP & Ors

(Supra), the Supreme Court has observed as follows:

"5. We have considered the rival submissions made by learned counsel for the parties and perused the record.

There can be no dispute to the settled legal proposition of law that in view of the provisions of Section 128 of the Indian Contract Act, 1872 (hereinafter called the 'Contract Act), the liability of the guarantor/surety is co- extensive with that of the debtor. Therefore, the creditor has a right to obtain a decree against the surety and the principal debtor. The surety has no right to restrain execution of the decree against him until the creditor has exhausted his remedy against the principal debtor for the reason that it is the business of the surety/guarantor to see whether the principal debtor has paid or not. The surety does not have a right to dictate terms to the creditor as how he should make the recovery and pursue his remedies against the principal debtor at his instance.

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(Vide: The Bank of Bihar Ltd. v. Dr. Damodar Prasad and Anr., AIR 1969 SC 297; Maharashtra State Electricity Board, Bombay v. The Official Liquidator, High Court, Emakulam and Anr., AIR 1982 SC 1497; Union Bank of India v. Manku Narayana, AIR 1987 SC 1078; and State Bank of India v. Messrs. Indexport Registered and Ors., AIR 1992 SC 1740)."

10. From the aforementioned decision of the Hon'ble Supreme

Court, it is apparent that the liability of the guarantor is

coextensive with the debtor. Therefore, both would stand on equal

footing when it comes to proceeding for recovery of the amount. If

that be so, we do not find any force in the submission of the

learned counsel appearing for the Petitioner that the Bank must be

directed to first proceed against the properties of the partner of the

firm and the borrower and only thereafter, proceed against the

Petitioner's property.

11. For the reasons cited hereinabove, we do not find any good

ground to entertain the Writ Petition. The same is accordingly

dismissed.