The Maharashtra Registrar of Co-operative Societies (RCS) has appointed D Doiphode as liquidator to wind up the crisis-ridden Rupee Co-operative Bank following the dismissal of the appeal by the Appellate Authority.
The Appellate Authority in the Finance Ministry, vide order dated October 31, 2022, has dismissed the appeal filed by the Rupee Co-operative Bank Ltd. against the cancellation order dated August 8, 2022, paving the way for the appointment of a liquidator.
Consequently, the RCS, Maharashtra, in exercise of power conferred under Maharashtra Co-operative Societies Act, 1960, has appointed the liquidator, vide order dated October 31, 2022, for winding up of the affairs of the Rupee Co-operative Bank Ltd, Pune.
The Maharashtra registrar of co-operative societies (RCS) has appointed D Doiphode as liquidator to wind up the crisis-ridden Rupee Co-operative Bank. The liquidator will focus on recoveries and repayment to depositors of up to Rs 300 crore, media reports add.
It bears recalling that the Reserve Bank of India had cancelled the banking licence of Rupee Co-operative Bank Ltd, Pune on August 10, 2022. However, the Hon’ble High Court of Bombay had suspended the cancellation order till the conclusion of the appeal filed by Rupee Co-operative Bank Ltd before the Appellate Authority.
Subsequently, the Supreme Court of India in the Petition for Special Leave to Appeal had directed that the order of stay which was granted by the High Court of Bombay shall stand restricted to the period up to and inclusive of October 31, 2022.
As a last resort the Rupee Cooperative Bank Employees federation had urged finance minister Nirmala Sitharaman to consider the merger of the bank with another private bank in the larger interest of the depositors. Bhalchandra Kulkarni, a member of the depositors’ association is quoted as saying they do not want a liquidation process as the process of merger is on.
The Rupee Bank’s administrator had tried his best that the bank was merged and not liquidated. The names of several banks came up including leading UCBs such as Saraswat Bank and Cosmos Co-operative Bank.
The merger proposal of the Maharashtra State Co-operative Bank with Rupee Co-operative Bank also did not fructify. The Deposit Insurance and Credit Guarantee Corporation (DICGC) has already paid about Rs 700 crore to eligible depositors. The liquidator has the obligation to return the money to DICGC, based on recoveries and liquidation, said a state government official.
According to a source, at present, the total liabilities of Rupee Cooperative Bank are around Rs 1364 crore and the bank has ready realizable assets of Rs 924 crore which leaves a gap of Rs 440 crore. Obviously, the Liquidator has a big challenge facing him.