Kerala HC: Consumer Forums Can Hear Fixed Deposit Disputes Against Co-operative Banks Despite Section 69 of Kerala Co-operative Societies Act
A Division Bench of the Kerala High Court dismissed a writ appeal by Puthur Service Co-operative Bank, holding that Consumer Protection Act forums retain jurisdiction over deposit disputes even where the Kerala Co-operative Societies Act provides its own remedy.
A Division Bench of the High Court of Kerala at Ernakulam, comprising Dr. Justice A.K. Jayasankaran Nambiar and Justice Preeta A.K., on 2 June 2026 dismissed W.A. No. 1152 of 2026 filed by Puthur Service Co-operative Bank Ltd. No. 345, Thrissur. The bank had challenged a Single Judge's order upholding the dismissal of its 825-day delayed appeal before the Kerala State Consumer Disputes Redressal Commission. The Division Bench rejected the bank's argument that the depositor's only remedy lay under Section 69 of the Kerala Co-operative Societies Act, 1969, holding that the Consumer Protection Act — as a parliamentary enactment serving a definite consumer-protection purpose — operates in addition to, and not in derogation of, any other law. The bench granted the bank six months to comply with the underlying repayment order.
The Dispute Before the Division Bench
Sethumadhavan, the first respondent, had deposited a total of ₹5,00,000 with Puthur Service Co-operative Bank through different fixed deposit receipts. The deposits matured on 2 June 2015, but the bank failed to return the amounts. Sethumadhavan filed a consumer complaint, C.C. No. 746 of 2015, before the District Consumer Disputes Redressal Commission, Thrissur.
The District Commission, by its order dated 31 December 2021 (Ext. P3), directed the bank to repay ₹5,00,000 with 12% interest and also to pay ₹10,000 as cost and compensation. The bank did not appeal promptly. It filed an appeal before the Kerala State Consumer Disputes Redressal Commission only in October 2024, accompanied by a petition seeking condonation of a delay of 825 days.
The State Commission dismissed the delay-condonation petition (Ext. P7) and, consequently, dismissed the appeal itself (Ext. P8). The bank then filed W.P.(C) No. 17094 of 2025 before the High Court challenging Exts. P7 and P8. The learned Single Judge found that the Commission's reasoning was neither illegal nor perverse and upheld both orders. The bank then preferred the present writ appeal.
The Jurisdiction Argument Raised in Appeal
Before the Division Bench, the bank raised a fresh contention: that the first respondent's proper remedy was an appeal under Section 69 of the Kerala Co-operative Societies Act, 1969, and that the Consumer Disputes Redressal Forum inherently lacked jurisdiction to entertain the complaint. The bank argued that the Single Judge had failed to address this jurisdictional question.
Section 69 of the Kerala Co-operative Societies Act, 1969 provides a mechanism for resolution of disputes between members and the management of a co-operative society. The bank's position was that since the depositor was a member of the society, that statutory forum was the exclusive avenue.
How the Bench Reasoned
Justice Preeta A.K., writing the judgment, rejected the jurisdictional challenge on two distinct grounds.
The bench first held that the Consumer Protection Act, 1986 and its successor, the Consumer Protection Act, 2019, are special parliamentary legislation enacted to protect consumers. As special law, their provisions override the provisions of the Kerala Co-operative Societies Act, 1969. The bench added that even if the Consumer Protection Act were treated as a general law, settled legal principle dictates that a later law — even if general — overrides an earlier special law where there is inconsistency between the two.
The bench then turned to the text of the statutes. Section 3 of the Consumer Protection Act, 1986 (corresponding to Section 100 of the 2019 Act) expressly states that the Act's provisions are in addition to and not in derogation of any other law in force. The bench held that the existence of a dispute-resolution mechanism under the Co-operative Societies Act and its rules does not oust the right of a creditor to invoke the Consumer Protection Act. The two remedies coexist.
The bench also addressed the bank's conduct directly. It observed that the bank, as a banking institution dealing with public funds, owes a duty to its depositors to make prompt payment. The liability to return the fixed deposit amounts — which fell due as early as 2015 — was not disputed. The bench described reliance on technicalities to thwart the claim as conduct that is “to be highly deprecated.”
On the delay-condonation question, the bank had argued before the Single Judge that the management of the society was under an Administrator from 10 December 2014 to 7 May 2022, and that this explained the failure to file the appeal in time. The Single Judge had found that the Commission's reasoning in rejecting this explanation was not perverse. The Division Bench agreed with that assessment and found no reason to interfere.
Outcome
The Division Bench dismissed W.A. No. 1152 of 2026 with no order as to costs. It expressed complete agreement with the view taken by the Single Judge in the impugned judgment. Taking note of a submission by counsel for the bank seeking time to comply, the bench granted six months to the bank to comply with the District Commission's Ext. P3 order directing repayment of ₹5,00,000 with 12% interest and ₹10,000 as cost and compensation.