JOCKIM CORREA Vs. STATE OF KARNATAKA

JUDGEMENT

(1.) The Petitioners are the members of Board of Directors of M/s Kallamundkur Seva Sahakari Sangha Niyamitha [hereafter referred to as, 'the Cooperative Society'] along with fifth to ninth respondents; the first and the second petitioners are the President and Vice President respectively. The petitioners have impugned the order dtd. 21/5/2022 [Annexure D] by the Deputy Registrar of Cooperative Societies, Mangalore [the second respondent]. The second respondent by the impugned order has superseded the Board for a period of 6 months appointing an administrator to manage the affairs of the Cooperative Society during this period.

(2.) The second respondent, before issuing the impugned order dtd. 21/5/2022, has issued Show Cause Notice dtd. 9/5/2022 [Annexure B] to the petitioners and the other members of the Board mentioning certain specific acts of omissions and commissions. The second respondent apart from mentioning such specific acts of omissions and commissions has also mentioned that there are two factions amongst the Directors. The petitioners, who make one faction, do not permit the other faction made up of the fifth and ninth respondents to effectively participate in the Board proceedings and this has resulted in lack of cohesion amongst the members of the Board affecting the developmental activities of the Co-operative Society. The second respondent has further stated that action under Sec. 30 of the Karnataka Cooperative Societies Act, 1959 (for short the ' Cooperative Societies Act ') should be taken because [a] there is persistent default and negligence in performance of the duties; [b] the conduct of the affairs of the Cooperative Society is prejudicial to its interest, [c] there is stalemate in the functioning of the Board and [d] there are serious financial irregularities and fraud.

(3.) The petitioners have responded to the Show Cause Notice by their reply dated 17.0 5.2022 [Annexure C]. The petitioners have alleged that the Show Cause Notice dtd. 9/5/2022 is issued under political pressure, and though this notice dtd. 9/5/2022 refers to different annexures, the copies of these annexures have not been furnished and without the copies of such annexures they would not be in a position to meet the allegations. The petitioners have asserted that a meeting of the Board is convened on 24/5/2022, and the notice would be placed before the Board in such meeting for appropriate response. The petitioners have also stated that if the copies of the annexures are furnished immediately, they would file a reply within 2 weeks. The second respondent has thereafter issued the impugned order dtd. 21/5/2022.