IN THE HIGH COURT OF KERALA AT ERNAKULAM
WP(C).No. 18634 of 2009(Y)
1. A.R.RADHAMANIAMMA,PARAYIRIKUNNATHIL
... Petitioner
Vs
1. THE JOINT REGISTRAR OF CO-OPERATIVE
... Respondent
2. THE ASSISTANT REGISTRAR OF CO-OPERATIVE
For Petitioner :SRI.P.P.JACOB
For Respondent :GOVERNMENT PLEADER
The Hon'ble MR. Justice ANTONY DOMINIC
Dated :27/07/2009
O R D E R
ANTONY DOMINIC, J.
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W.P.(C) NO. 18634 OF 2009 (Y)
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Dated this the 27th day of July, 2009
J U D G M E N T
Petitioner was the Secretary of Kulanada Service Co-
operative Bank Limited. On the allegation that she had
committed certain misconducts, disciplinary proceedings were
initiated and ultimately, she was terminated from service.
2. There were complaints from the members of the
managing committee of the Bank and acting upon the report of
the Assistant Registrar (General), Kozhencherry, vide order dated
3/9/04, an enquiry under Section 65 of the Kerala Co-operative
Societies Act was ordered and the Kulanada Unit Inspector was
authorised to conduct the enquiry. Accordingly enquiry was
conducted and Ext.P1 report was submitted. In the said report,
Rs.5,15,890.26 was recommended to be recovered from the
petitioner.
3. On the strength of Ext.P1 report, notice was issued to
the petitioner calling upon her to remit the amount. On receipt of
the said notice, petitioner submitted Ext.P2 reply disputing her
liability to remit the amount. While matters stood thus, Ext.P3
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notice dated 11/5/2009 was issued calling upon the petitioner to
file objections against initiating proceedings under Section 68 of
the Act pursuant to an order dated 13/4/2007 passed by the Joint
Registrar. On receipt of the said notice, petitioner submitted
Ext.P4 request for furnishing her details of the order dated
13.4.2007 passed by the Joint Registrar and accordingly Ext.P6
order was furnished to her. Thereafter, petitioner submitted
Ext.P5 reply. It was at that stage this writ petition was filed
praying to quash Exts.P3 and P6 and to direct the 1st respondent
to comply with Rule 66(5) of the Kerala Co-operative Societies
Rules.
4. The contention raised by the petitioner is mainly that
except after complying with Rule 66(5), the 1st respondent is
incompetent to initiate any action based on Ext.P1 report
submitted under Section 65 of the Act. Therefore, it is contended
that Exts.P3 and P6 are premature and illegal.
5. A counter affidavit has been filed by the 2nd
respondent, where it is stated that the enquiry under Section 65
resulting in Ext.P1 report was submitted with notice to the
affected parties including the petitioner. It is also stated that the
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members of the managing committee had challenged Ext.P1
report before the Arbitration Court by filing ARC 28/07 and had
obtained an order of stay against initiating proceedings on the
basis of the report. It is stated that the said ARC was finally
dismissed by order dated 5/9/2008 and that it was thereafter that
Ext.P3 notice was issued.
6. Answering the contention of the petitioner that the
period prescribed for enquiry under Section 68 has also expired
and therefore, Ext.P3 notice was without jurisdiction, it is stated in
the counter that the said period has been extended till 31/7/2009.
It is also contended that for initiating proceedings under Section
68 of the Act, notice and hearing as contemplated under Rule 66
(5) of the Rules is unnecessary.
7. From the above pleadings and the submissions made
by the counsel on either side, the only question that arises for
consideration is whether the Registrar is required to comply with
Rule 66(5) of the Kerala Co-operative Societies Rules before
initiating any action under Section 68 on the basis of the report
submitted under Section 65 of the Act. Rule 66 of the Rules
provides the procedure for the conduct of inquiry and inspection
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under Section 65 and 66 of the Act. Sub Rule 5 inter alia provides
that on submission of the report by the enquiry officer, the
Registrar shall pass such orders thereon as may be considered
just after giving a reasonable opportunity of being heard to the
society, person or persons concerned.
8. From the facts, it can be seen that as per Ext.P6 order
dated 13/4/2007, proceedings under Section 68 were ordered to
be initiated and it was on the basis of the said order that Ext.P3
notice for fixing the liability under Section 68 was issued.
9. Under Section 65, on the orders of the Registrar, an
enquiry officer is appointed to conduct the enquiry. The enquiry
officer thereupon conducts the enquiry with notice to the parties
and makes his report. Once the report is submitted to the
Registrar, it is for the Registrar to independently consider the
report and pass orders thereon. Rule 66(5) provides that before
the Registrar passes any such order, the Society, the person or
persons concerned who are likely to be affected by the report are
entitled to be issued notice and heard. Such persons and
Societies are entitled to canvass before the Registrar the
correctness or otherwise of the findings of the enquiry officer. It
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is such opportunity which is provided under Rule 66(5) and
necessarily the said rule is mandatory in character and has to be
complied with before proceeding further. This is all the more so
since proceedings under Section 68 are penal in nature.
10. True, the learned Government Pleader referred me to
the judgment of this Court in State of Kerala v. Sudarsanan
(1997(2) KLT 522), which reversed the judgment of the learned
Single Judge in Sudarsanan v. State (1997(1) KLT 957). That
was a case where proceedings were initiated under Section 32 of
the Act. Facts of that case are different from the facts arising in
this case. Therefore, in the absence of the Registrar having
complied with the procedure laid down under Rule 66(5), both
Exts.P3 and P6 are premature and illegal. For that reason,
Exts.P3 and P6 will stand set aside.
The writ petition is therefore disposed of setting aside
Exts.P3 and P6, but however clarifying that it will be open to the
1st respondent to comply with Rule 66(5) of the Co-operative
Societies Rules and thereafter initiate fresh proceedings in the
matter.
ANTONY DOMINIC, JUDGE
Rp