Surat's Urban Co-op Credit Society faces heat

After the big fall out of co-operative banks, Surat faced another crisis when the depositors of Surti Modh Vanik Urban Co-operative Credit Society Ltd demanded their money back as the news spread that the Society was in deep trouble.

The crisis in the society is mainly because it had invested a huge sum in two co-operative banks, which it could not recover as the banks have been liquidated.

Scores of depositors and members gathered at the society's office located in Limda Chowk area of Surat on Wednesday morning, demanding their money back. The depositors, mostly belonging to the Ghanchi community, surrounded the society directors and asked them to repay their deposits. The directors, however, expressed inability to repay any money for the time being.

This angered the depositors who accused the society chairman and directors of laundering their money for personal gains. The depositors hurled abuses and threats on the directors, which continued for well over two hours.

Kishore Chaliyawala, one of the society's directors, told Business Standard, "The society had deposited Rs 1.29 crore in Madhavpura Mercantile Co-operative Bank, Rs 2.39 crore in Vikas Co-operative Bank Ltd, and Rs 40 lakh in Panchsheel Mercantile Co-operative Bank Ltd five years back."

"The society is facing the crisis because Madhavpura Bank and Vikas Bank have been liquidated and we have not received any money. We have filed a claim with both the banks and have been trying got get our money for the last six months," Chaliyawala said.

"We repaid Rs 20.75 lakh to our members, whose deposits had matured on Tuesday. We do not have any cash on hand and hence we are not in a position to repay any more to the depositors. We are, however, trying to arrange the money, so that we can repay the depositors," Chaliyawala, who is also a BJP corporator, said.

Ajay Gheewala, a depositor , said, "The society is facing a crisis, because it repaid Rs 80 lakh to those depositors, whose accounts have not even matured, on Friday. The directors realised that the society was facing a crisis and would close down any time. They repaid the deposits of their relatives and friends. The directors have treated the society like a private firm. The directors are now saying that they cannot repay the matured accounts of normal depositors like me."