The Kerala High Court has held that depositors of co-operative banks can seek remedies under the Consumer Protection Act despite the existence of dispute resolution mechanisms under the Kerala Co-operative Societies Act. The Court dismissed an appeal filed by a co-operative bank that had challenged consumer forum orders directing repayment of a matured fixed deposit along with interest and compensation.
The Bench of Justice A.K. Jayasankaran Nambiar and Justice Preeta A.K. while referring to Section 3 of the Consumer Protection Act, 1986 (now mirrored in Section 100 of the Consumer Protection Act, 2019), reiterated that the provisions of the consumer law operate “in addition to and not in derogation of” other laws in force. Consequently, creditors of co-operative societies are free to invoke consumer jurisdiction for recovery of amounts due.
The case arose after a depositor placed fixed deposits totaling ₹5 lakh with the co-operative bank. The deposits matured on June 2, 2015, but the bank failed to return the money despite the maturity of the deposits. Aggrieved by the non-payment, the depositor approached the District Consumer Disputes Redressal Commission, Thrissur, seeking relief.
After examining the matter, the District Consumer Commission directed the bank to repay the principal amount of ₹5 lakh along with 12% interest. The Commission also awarded compensation and litigation costs to the depositor. The order was passed on December 31, 2021.
However, instead of filing an appeal within the prescribed limitation period, the bank approached the State Consumer Commission only in October 2024, accompanied by an application seeking condonation of an extraordinary delay of 825 days. The State Commission rejected the delay condonation plea and consequently dismissed the appeal.
Before the High Court, the bank argued that the delay occurred because the society had been managed by an Administrator between December 2014 and May 2022. It contended that this administrative arrangement prevented timely filing of the appeal. Both the Consumer Commission and the Single Judge had found the explanation unsatisfactory and refused to interfere with the original order.
In the writ appeal, the bank raised an additional legal contention that disputes involving members of co-operative societies should be resolved under Section 69 of the Kerala Co-operative Societies Act and not before consumer forums.
Rejecting the bank’s argument, the High Court emphasized that the Consumer Protection Act is a special welfare legislation enacted to safeguard consumer interests. The remedies provided under the Consumer Protection Act are additional remedies and do not exclude remedies available under other laws.
The Bench noted that even though the Kerala Co-operative Societies Act creates rights and obligations between members and societies and provides its own dispute resolution framework, that framework does not take away the jurisdiction conferred upon consumer forums. The Court observed that Parliament intentionally created consumer forums to provide an effective remedy for consumers and creditors.
The Court made strong remarks regarding the responsibilities of banking institutions handling public funds. It observed that a bank owes a duty to its depositors to ensure prompt repayment of matured deposits. Since the liability to return the fixed deposit amount was not disputed and the money had remained unpaid since 2015, the Court criticized attempts to rely on technical objections to defeat the depositor’s claim.
According to the Bench, resorting to procedural technicalities in such circumstances was highly undesirable, particularly when the depositor’s entitlement to the funds was undisputed.
While affirming the orders of the consumer fora and the Single Judge, the High Court took note of the bank’s request for time to comply with the repayment directions. Considering the submission, the Court granted the bank six months to satisfy the award and repay the depositor along with the amounts directed by the consumer forum.
The writ appeal was ultimately dismissed, bringing the long-running dispute to a close and reaffirming the availability of consumer remedies against co-operative banks in cases involving non-payment of matured deposits.
Case Details
Case Title: Puthur Service Co-Operative Bank Ltd. Versus Sethumadhavan
Citation: JURISHOUR-1546-HC-2026(Ker)
Case No.: WA NO. 1152 OF 2026
Date: 02/05/2026
Counsel For Petitioner: M.Sasindran
Counsel For Respondent: K.P.Suresh Kumar
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