PRITHVI NATH Vs. JOINT REGISTRAR, CO-OPERATIVE SOCIETIES

JUDGEMENT

(1.) IN this writ petition the petitioner seeks annulment of two orders viz. Order dated 7-8-1976 and order dated 31-8-1976 issued by Joint Registrar Co-operative Societies, Srinagar respondent No. 1 herein. Facts in this case are not very much in dispute between the petitioner and respondent No. 1, the other respondents not having chosen to file their returns.

(2.) THE petitioner is a member of a Co-operative Society known as Tonga Drivers Transport Union Co-operative Society Ltd. Anantnag (hereinafter referred to as the 'Society'). This society was formed sometime in the year 1963 with respondent No. 4 as its chairman. The society started functioning and acquired three buses bearing Nos. JKA 3757, JKA 3758 and JKA 9013. It appears that before the end of the year 1969 the members started indulging in internecine activities as a result of which respondent No. 5 formed a separate group comprising of nine members. This was brought to the notice of the officers of the Co-operative Department as a consequence of which the Assistant Registrar Co-operative Societies (Audit) Anantnag submitted a report on 27-12-1971 to the Joint Registrar Co-operative Societies (Audit) Jammu and Kashmir Jammu bringing to the latter's notice the sad state of affairs prevailing in the society and further pointing out to him that Bus No. 3757/ JKA belonging to the society had been taken possession of by nine members of which no account was being rendered to either the Manager or the Chairman of the Society for the last three months. The Joint Registrar (Audit) in turn made a report on 13-3-1970 to Joint Registrar Co-operative Non-Agri and Marketing Jammu and Kashmir, Srinagar repeating to the latter what had been reported to him by the Assistant Registrar. Sometime in June 1970 the members of the society decided to bifurcate the society in two societies, i.e., one to be headed by respondent No. 4 and the other to be headed by respondent No. 5. The group headed by respondent No. 4 retained its nomenclature of the Tonga Drivers Transport Union Co-operative Society Anantnag, whereas the group headed by respondent No. 5 adopted the name of Islamabad New Tonga Drivers Transport Union Co-operative Society Anantnag and was accordingly registered by the Joint Registrar Co-operative Societies on 20-3-1972. As the new society headed by respondent No. 5 did not commence working, it was brought into liquidation by an order issued by respondent No. 1 on 18-1-1976. It may be mentioned here that both the petitioner as well as respondent No. 1 have said with one voice that the bifurcation of the society in the year 1970 was illegal and unwarranted. As the affairs of the society were in bad shape, respondent No. 1 deputed Deputy Registrar Co-operative Societies, Anantnag on 9-6-1975 to inspect the accounts and working of the society. The report of the Deputy Registrar revealed grave irregularities committed by the members of the committee. A show cause notice was issued on 27-6-1975 by respondent No. 1 to the society as to why proceedings under Section 29 of the Jammu and Kashmir Co- operative Societies Act, 1960 (hereinafter referred to as the 'Act') be not taken against the managing committee of the society. This show cause notice was issued on 27-6-1975 and a reply thereto was submitted by one Badri Nath on behalf of the Managing Committee, replying to the allegations made in the show cause notice. Respondent No. 2 on consideration of the show cause notice as well as the replies submitted thereto initially passed an order on 7-8-1975 under Section 29 of the Act read with S.R.O. No. 43 dated 27-1-1973 under which he was invested with the powers of Registrar Co-operative Societies superseding the managing committee of the society and appointed four persons as its administrators which included among others respondents 4 and 5 as well. The case of the petitioner is that this show cause notice was not accompanied by the findings of the Deputy Registrar who had inspected the accounts and working of the Managing Committee. But the case of respondent No. 1 on the other hand is that a copy of the report of Deputy Registrar was also supplied to the Managing Committee. As according to respondent No. 1, respondents 4 and 5 instead of facilitating the working of the Board of Administrators appointed by him started misconducting themselves the latter was compelled to pass a fresh order on 31-8-1976 superseding his earlier order and appointing three instead of four administrators as originally appointed. Among the new appointees respondents 4 and 5 did not find place and were replaced by respondent No. 6, the other two administrators of course remaining the, same. The petitioner has challenged these two orders dated 7-8-1976 and 31-8-1976 on the grounds that the contents of the Deputy Registrar's report not having been made known to the Managing Committee, the action of respondent No. 1 under Section 29 of the Act was unwarranted, that the financing institution i.e. the Central Co operative Bank Anantnag not having been consulted by respondent No. 1 the orders impugned in the writ petition were without jurisdiction, that respondent No. 1 not having powers of a Registrar, the orders passed by him were without jurisdiction that there being no compliance with clause (a) of Sub- Sec. (1) of Section 29 of the Act, the orders passed by respondent No. 1 were without jurisdiction and, that the impugned orders were vitiated by mala fides. Respondent No. 1 on the other hand has denied all these allegations and has further submitted that the alternative remedy of appeal under clause (d) of Section 103 of the Act read with the explanation appended to the Section being available to the petitioner, the petition was not maintainable.

(3.) A plain reading of this Section shows that the Registrar is to form his opinion on the result of an inquiry or an inspection or an audit conducted under the Act for proceeding under Section 29 of the Act. Before he can appoint a new committee or one or more administrators, under Sub-section (1) he is to give the Managing committee an opportunity to state its objections, if any. It is only after he considers the result of such inquiry, inspection or audit in the light of those objections, that he can proceed further in the matter on grounds mentioned in Sub-Sec (1) of Section 29. This necessarily implies that the objections which he intends to invite from the party to be adversely affected should be to the point and meaningful, i.e. they should fully meet out the exceptions taken against the conduct of the committee in the inquiry, inspection or audit report conducted under the Act which is a sine qua non for the opinion of the Registrar. It is therefore reasonable to infer that the substance of the result of the inquiry, inspection or audit must be conveyed to the Managing Committee before it is called upon in state its objections. This, however, does not mean that the Registrar must necessarily supply a copy of the inquiry, inspection or audit report to the Managing Committee. It is sufficient if the substance of the inquiry, inspection or audit is conveyed to the Managing Committee through the show cause notice itself. This by itself would provide a fair chance to the Managing Committee to effectively meet out all the points raised against it. In the present case it is true that respondent No. 1 has sworn an affidavit that a copy of the Inspection report conducted by the Deputy Registrar was also sent along with the charge sheet to the Managing Committee, but I am not prepared to accept this statement of respondent No. 1 and for more than one reason. To begin with this averment has been denied on oath by the petitioner in his rejoinder to the objections filed by respondent No. 1 and secondly a copy of the show cause notice which is annexure-'B' to the return filed by respondent No. 1 nowhere mentions that it is being accompanied by a copy of the inspection report of the Deputy Registrar, which statement in any opinion must have been there, had it been a fact, that such a copy was supplied to the Managing Committee. Be that as it may, I am still of the opinion that there has been sufficient compliance with Sub-section (1) of Section 29. The show cause notice is a comprehensive statement of facts and specifically speaks of the six objections which were taken by the Deputy Registrar in his inspection report dated 27-6-1975. These are illegal enrolment of three persons namely Badri Nath, Prithvi Nath and Abdul Rehman as members when they were not Tonga drivers, sale of the Bus No : 3757 JKA without calling for competitive offers and without obtaining permission of the Transport Department; bifurcation of the society in two societies contrary to the provisions of Act; failure to give proper attention to membership register and existence of cuttings and overwritings therein; failure to maintain daily accounts and failure to frame budget after the year 1971; and failure to take action for realising arrears from Bakayadars. This show cause notice, it would be abundantly clear, was in itself a comprehensive charter of the objections raised by the Deputy Registrar in relation to the conduct and working of the Managing Committee. All these points were specifically dealt with by the Managing Committee in its reply submitted to respondent No. 1. The authority Joint Registrar of Co-operative Societies Madras v. P.S. Rajagopal Naidu, AIR 1970 SC 992 cited by Mr. Hagree at the bar is in my opinion of no help to him. The facts of the case before the Supreme Court were entirely different from the facts of the instant case. The first ground urged by the petitioner therefore fails.