The court dismissed the Society’s justifications, confirming that public displays are not a permissible method of loan recovery under the Kerala Co-operative Societies Act or its Rules. It emphasized that the Act and Rules provide other legal methods for debt recovery, such as attachment and sale, but do not authorize the display of borrowers’ photographs and details.
Kerala : The Kerala High Court ruled that lenders cannot use the practice of publishing photographs and details of defaulting borrowers as a coercive method for loan recovery. The court stressed that such actions violate borrowers’ dignity and privacy, and cannot be justified under existing legal provisions.
Justice Murali Purushothaman, delivering a judgment on a writ petition filed by the Chempazhanthi Agricultural Improvement Co-operative Society, stated:
“The publication or display of photographs and personal details of defaulting borrowers in public is a violation of their right to live with dignity and reputation. Such deprivation of life and personal liberty is only permissible through a procedure established by law. The publication infringes upon the borrower’s dignity and reputation, breaching their fundamental right to life under Article 21 of the Constitution of India.”
BRIEF FACTS
This case arose after the Assistant Registrar of Co-operative Societies ordered the removal of a flex board outside the Society’s office. The board displayed the names, photographs, and loan details of 1,750 defaulting borrowers. The Society argued that the display was a final attempt after repeated recovery efforts had failed. Following the installation of the board, many borrowers approached the Society to settle their debts, prompting the Society to consider further displays.
The Society defended this method, likening it to the “beat of tom-tom,” a practice allowed under Rule 81 of the Kerala Co-operative Societies Rules, 1969. However, the Assistant Registrar deemed the display illegal, pointing to the lack of borrower consent and the potential for legal consequences from the public exposure.
The State, represented by Government Pleader Resmi Thomas, supported the Assistant Registrar’s decision, arguing that the Society had no legal authority to use such methods and that publishing personal information without consent violated privacy and damaged reputation, contravening constitutional rights.
READ ALSO: “No Estoppel Against Court’s Errors” – Kerala High Court Recalls Child Custody Order
The court dismissed the Society’s justifications, confirming that public displays are not a permissible method of loan recovery under the Kerala Co-operative Societies Act or its Rules. It emphasized that the Act and Rules provide other legal methods for debt recovery, such as attachment and sale, but do not authorize the display of borrowers’ photographs and details.
In addressing the analogy to the “beat of tom-tom,” the court described it as an outdated practice no longer suitable for modern times but refrained from ruling on its overall validity as it was not directly challenged in the case.
The court ultimately upheld the Assistant Registrar’s order and dismissed the writ petition.
Cause Title: The Management Committee of Chempazhanthi Agricultural Improvement Co-operative Society & Another v. The Assistant Registrar of Co-operative Societies [WP(C) No. 45919 of 2024]
View Order
