ALLEPPEY CYCLE ASSEMBLING WORKERS Vs. GENERAL MANAGER

JUDGEMENT

(1.) A society wants to sell its immovable property, for discharge of its debts and to appropriate the surplus funds among its members; does it fall foul of Section 55 of the Co- operative Societies Act ?

(2.) The petitioner Society owed debt to the Government. The general body of the Society resolved to sell the immovable property of the Society, for discharge of the debt. The resolution was forwarded to the Registrar for sanction. Rule 54(2) of the Co-operative Societies Rules warrants prior sanction of the general body and of the Registrar, for disposal of the immovable property of the Society. It is in compliance thereof that the afore was done. The Registrar as per Ext.P3 order refused to grant permission, pointing out that, as per the general body decision, the surplus funds after the discharge of the debt is proposed to be appropriated between the share holders, and that it violates Section 55 of the Co-operative Societies Act.

(3.) It appears that, subsequently, three of the members of the society, based on the earlier general body resolution, made a fresh request to the Registrar seeking permission for sale of the property. As per Ext.P4 order dated 12.1.2017, the said application was rejected. Under Ext.P4, it was directed that the society be liquidated in terms of Section 71(2) of the Co-operative Societies Act. The petitioners are aggrieved by the rejection of the sanction sought for sale of the property as also the direction for winding up.