JUDGMENT H.N. Seth, A.C.J. 1. Jalaun Kraya Vikraya Sahkari Samiti Ltd., is a Cooperative Society registered under the Cooperative Societies Act. It appears that the Petitioners entered into certain transactions with the Cooperative Society in the year 1970. The Cooperative Society claimed that a sum of Rs. 30,000/-was due to it from the Petitioners. In due course the proceedings for realisation of the said amount together with interest thereon were initiated against the Petitioners under a recovery certificate issued by Respondent No. 2, the Assistant Registrar, Cooperative, Oral, u/s 95A of the Act. In pursuance of the recovery certificate issued by the Assistant Registrar, the Collector, District Jalaun, took steps to realise the said amount as arrears of land revenue. In that connection, the Amin of the Cooperative Department approached the Petitioner No. 2, calling upon him to pay the said amount. Aggrieved the Petitioner has approached this Court for relief under Article 226 of the Constitution. 2. According to the Petitioners, the amount claimed by the Cooperative Society was not due from him. In fact, as a result of the transaction entered into by him and the Cooperative Society, the Cooperative Society was liable to compensate him for the damages suffered by him. They also claimed that as the Petitioners were not the members of the Cooperative Society, the dues could not be recovered from them under the provisions of the Cooperative Societies Act. Further, while the dues were sought to be recovered, the Petitioner approached the District Magistrate/Collector of the district and informed him that the recovery which was being sought to be made against him was illegal. The District Magistrate, on 21st August, 1976, made an order requiring the Assistant Registrar to enquire into the matter and thereafter to take steps only for realisation of the correct amount that may by due from the Petitioner. In spite of this, the Respondents are proceeding to press the recovery of the entire amount without holding any enquiry. 3. Respondent No. 1 i.e. the Cooperative Society has put in appearance to contest the prayer made in the writ petition.
In spite of this, the Respondents are proceeding to press the recovery of the entire amount without holding any enquiry. 3. Respondent No. 1 i.e. the Cooperative Society has put in appearance to contest the prayer made in the writ petition. According to the Respondent, the Petitioner was a member of the Cooperative Society which was an agricultural credit society and the provisions of Section 95A of the Cooperative Societies Act were fully applicable and the recovery proceedings initiated on the basis of the certificate issued by the Assistant Registrar were perfectly legal and in order. The Respondent, therefore, claimed that no case had been made out for interfering with the recovery proceedings in exercise of jurisdiction under Article 226 of the Constitution. 4. The averments made in various affidavits bring out that the Assistant Registrar has issued the recovery certificate without informing the Petitioner whether he wanted to contest the amount as claimed to be due from him by the Cooperative Society. Section 95A of the Cooperative Societies Act runs thus: 95A. Special provision for recovery of certain dues of agricultural society-(1). The Registrar may, on an application made by the Society referred to in Section 34 or an agricultural credit society for the recovery of arrears of any loan advanced by it or any installment thereof to any member and on its furnishing a statement of accounts in respect of such loan and after making such enquiries, if any, as he thinks fit, issue a certificate for the recovery of the amount due. (2) A certificate issued by the Registrar under Sub-section (1) shall be final and conclusive proof of the dues which shall be recoverable as arrears of land revenue. 5. It is true that under Sub-section (I) of Section 95A, after an application has been made to the Registrar for recovery of arrears of loan advanced by the society, the Registrar has been given discretion to hold such enquiry into the claim made by the society as he thinks fit. This provision, however, does not mean that while issuing recovery certificate, the Registrar can give a go by to the principles of natural justice.
This provision, however, does not mean that while issuing recovery certificate, the Registrar can give a go by to the principles of natural justice. As and when an application is made to the Registrar to recover any balance or installments of loan from any debtor, the registrar has to, in accordance with the principles of natural justice, inform the debtor concerned about the claim made by the society so that the debtor may approach and satisfy him about the following matters: That the debtor is not a member of the Society ; That the amount sought to be recovered is not in fact a loan advanced by the Society to him; That the amount of loan has either been wholly or partly paid up. 6. It is after the debtor has shown cause that discretion arises with the Registrar either to depending upon the circumstances of the case, hold such enquiry in the matter as he thinks fit and proper. In the instant case, it is clear that although the Petitioners wanted to contest their liability, the Registrar issued the recovery certificate to the collector without affording them any opportunity to place their version before him. The Respondent persisted in recovering the said amount as arrears of land revenue despite the order made b the Collector on 21.8.1976 requiring the Assistant Registrar to look into the matter before proceeding to recover the amount from the Petitioner, on the pretext that the said order of the District Magistrate was never brought to the notice of the Registrar. Be that as it may, as already explained, the Registrar was bound to, at least inform the Petitioner about the claim made by the society and to hear him before issuing any recovery certificate in respect of the claim made by the Cooperative Society. As this has not been done, the action of Respondent in pressing the recovery certificate cannot be sustained. 7. In the result, the petition succeeds and is allowed. The impugned recovery proceedings are quashed. It is, however, made clear that the order will not stand in the way of the Registrar to issue fresh recovery certificates against the Petitioner after affording them an opportunity to substantiate their version. Parties are directed to bear their own costs.
7. In the result, the petition succeeds and is allowed. The impugned recovery proceedings are quashed. It is, however, made clear that the order will not stand in the way of the Registrar to issue fresh recovery certificates against the Petitioner after affording them an opportunity to substantiate their version. Parties are directed to bear their own costs. The amount, if any, deposited by the Petitioner under the interim order made by this Court shall be disposed of in accordance with the ultimate decision regarding issue of fresh recovery certificate that may now be taken by the Registrar.