RAMU DADA PANADE Vs. STATE OF KARNATAKA

JUDGEMENT

(1.) this writ petition is directed against the impugned order dated 20-6-1989 passed by the state government under Section 30(a) of the Karnataka co-operative societies Act, 1959 (hereinafter referred to as 'the act') superseding the board of management of the raibagh sahakari sakkrare karkhane limited by appointing the deputy commissioner, bclgaum district, bclgaum as the special officer to manage the affairs of the said sugar factory for a period of one year or until further orders with immediate effect, whichever period is earlier.

(2.) the material facts involved in this case are as follows: the petitioner who is the ex-chairman of raibagh sahakari sakkare karkhane niyamith, raibagh was elected to the board of management of 4th respondent during the year 1986. According to the petitioner, during his chairmanship, the management and functioning of the factory produced improved results and profits winning appreciation from bankers and majority of the shareholders. It was only between 1979 and 1983, the committee came to be changed and replaced by a nominated committee and during that period there was mal-functioning resulting in enormous loss to the society. The petitioner is substantiating the said assertion by producing a comparative chart relating to the production, borrowing and repayment of the loans during the period 1979 to 1983 when the management was in the hands of the nominated committee. Further the petitioner has also produced a chart reflecting the position that prevailed during the management of the elected body from 1983 to 1987. By this comparison, the petitioner is making out a case that there was nomal-administration or impropriety in management during the period when the elected body was functioning under the chairmanship of the petitioner. On the other hand, it is claimed that the management was marked by efficient administration and realisation of huge profits. On 21-7-1987, a show cause notice was issued by the 2nd respondent under Section 30(1) of the act to the petitioner and the same was suitably replied by the petitioner on 12-8-1987. Thereafter, an order was passed on 2-2-1988 superseding the elected body notwithstanding the reply given by the petitioner. In writ petition No. 4449 of 1988, the said order of supersession was challenged and emergent notice was ordered to the first respondent. However, there was a significant development within a short period from the date of supersession and an order dated 24th march, 1988 was passed by the state government revoking the order of supersession dated 2nd february, 1988 and restoring the original board of management. In view of the revocation, the writ petition came to be dismissed as infructuous. It is slated that the central and state governments accorded sanction for the expansion of the crushing capacity of the factory to 2500 tcd. Another significant development took the petitioner by surprise within a period of two months from the date of revocation when an order was passed by the 2nd respondent in the purported exercise of power vested in him under Section 64(1) of the act directing statutory inquiry fixing the time limit for submitting the report of the inquiry within four weeks from the date of the order and also to fix specific responsibilities on the persons concerned. This was the order passed on 31-5-1988. This was the subject matter of challenge in writ petition No. 9839/1988, (1989(1) kar.lj. 143) and while disposing of the said writ petition, the court made the following observation:

(3.) statistical figures have been furnished by the petitioner in support of the assertion that the society had been functioning efficiently and huge profits were realised during the chairmanship of the petitioner. For instance, it is shown that a profit of rs, 65,55,186-66 ps. Was realised. It is also shown that a net profit of Rs. 1,27,94,506- 91 ps. Was realised for the year ending with 1987- 88 based on the audit report of the government. In fact, it is said that the auditors upgraded the audit classification of the 4th respondent from category 'c' to category 'b' on the basis of good performance.