BHAGWAN SWAROOP Vs. COMMERCIAL CO OPERATIVE BANK LTD

JUDGEMENT

(1.) THIS application is for quashing a reference to Arbitration Tribunals appointed by the Respondent No. 2, the Registrar, Cooperative Societies.

(2.) THE petitioner Bhagwan Swaroop was a member of the managing Committee of the Commercial Cooperative Bank, Ajmer which is the first respondent to this application and was also the director of the said Bank. THE Bank was registered under the Cooperative Societies Act, 1912. One Shri Nandlal Sharma was the Manager of the Bank and it appears that he used to carry on the management and administration of the Bank under the control and supervision of the Directors and the Managing Committee. Under the Cooperative Societies Act the Registrar of Cooperative Societies the respondent No. 2 also exercised supervision and control and according to the rules of the Bank the accounts of the Bank had to be annually audited by the Cooperative department as also by its auditors. It appears that on 26th June, 1953 two cheques of Rs. 3000/- each were drawn by the petitioner and the Manager Shri Nandlal Sharma. THEre was also another cheque for Rs. 1500 - drawn on the same day by the petitioner and the respondent Dharamchand who happened to be the Secretary of the Bank. THE cheques for Rs. 3000/- each were cashed on the 8th July, 1955 on the State Cooperative Bank, Ajmer and the other cheque for Rs. 1500/- on the State Bank of India on the same day, but in the accounts of the Bank no credit was given for these amounts. It also appears that after cashing those cheques Shri Nandlal Sharma-disappeared. THEn an enquiry was instituted when it is alleged to have been discovered that several lacs of rupees belonging to the Commercial Bank had been embezzled. THE Registrar Cooperative Societies appointed one Kartar Singh as Administrator to take charge of the Bank. THE said Administrator then issued notice on the petitioner demanding payment of the sum of Rs. 6000/- which had been drawn from the State Cooperative Bank, Ajmer on 8th July, 1955 by means of the two cheques in question and also issued another notice for payment of the sum of Rs. 1500/- which was drawn from the State Bank of India oh account of the Commercial Cooperative Bank, Ajmer.

(3.) WE accordingly allow this application and direct that the tribunals so constituted and the respondent No. 2 the Registrar of the Cooperative Societies should be dissolved and should not be allowed to function and decide the matter in dispute under reference. It would be open to the Registrar to appoint fresh tribunals in which persons other than Yad Ram Sharma should be nominated by the present Liquidators of the Commercial Cooperative Bank Ltd. , Ajmer, to represent it on the tribunals, though there can be no objection to the other members of the tribunals being associated with the tribunals constituted afresh by the Registrar.