( 1 ) THE Guntur Co-operative Urban Bank Limited (for short, the Bank), which was originally registered under the provisions of the A. P. Co-operative societies Act, 1964 was converted into one under the provisions of the A. P. Mutually aided Co-operative Societies Act, 1995 (for short, ap MACS Act) on 6-11-1998. In pursuance of the elections held under the provisions of the AP MACS Act, the petitioner in W. P. No. 12100 of 2004 was elected as Chairman and the petitioners in w. P. No. 14222 of 2004 were elected as the Directors and they assumed charge on 28-5-2004. While so, the impugned order dated 7-7-2004 was issued by the 1st respondent - Registrar of Co-operative societies, in exercise of powers conferred under Section 36-A of the AP MACS act, thereby superseding the Board of directors of the Bank and appointing the district Co-operative Officer, Guntur as the Special Officer/administrator to manage the affairs of the Bank initially for a period of one year. ( 2 ) THE said order is under challenge in these two writ petitions with a common prayer for a writ of mandamus declaring the proceedings of the 1st respondent -Registrar of Co-operative Societies dated 7-7-2004 passed under Section 36-A of the A. P. Mutually Aided Co-operative societies Act, 1995 superseding the Board of Directors of the Guntur Co-operative urban Bank Limited and appointing the district Co-operative Officer, Guntur as the Special Officer/administrator to manage the affairs of the said Bank for a period of one year as arbitrary and illegal. Hence, both the writ petitions are heard together and decided by this common order. ( 3 ) IT is primarily contended by the petitioners that the action of the 1st respondent - Registrar of Co-operative societies was without jurisdiction and beyond his powers under Section 29 of the a. P. MACS Act. It is also contended that even while exercising the powers under section 115-B of the A. P. Co-operative societies Act, 1964 as made applicable to the societies registered under the A. P. MACS Act under Section 36-A, it is incumbent upon the 1st respondent to follow the principles of natural justice by issuing notice to the affected society thereby affording an opportunity to put forth its version. On merits, it is contended that the Bank is financially sound and therefore there was absolutely no justifiable reason to supersede the elected body and to appoint a Departmental Officer at the instance of the Reserve Bank of India ( 4 ) THE District Co-operative Officer, guntur, filed a counter-affidavit stating that eversince the conversion of the Bank under the A. P. Mutually Aided Co-operative societies Act, 1995, the Bank had not been functioning properly and taking advantage of the liberal provisions of the ap MACS Act, 1995 the Chairman and board of Directors of the Bank committed several irregularities and recruited about 78 persons flouting all the rules and the procedure prescribed under law. On the basis of the news reports published in the local dailies, the Registrar (Vigilance)and Enforcement Officer, Guntur conducted surprise check on 19-3-2001 and submitted a report to the Government on 18-5-2001 pointing out various serious irregularities in the process of recruitments. On the basis of the complaint made by one of the depositors forwarded by the Reserve Bank of India, the Commissioner for Co-operation and the Registrar of Co-operative Societies directed enquiry by the District Co-operative officer, Guntur as per the provisions of the AP MACS Act, 1995 and the Rules made thereunder. The District Co-operative officer who is the District Registrar under the A. P. Mutually Aided Co-operative societies Act, 1995 conducted a preliminary enquiry into the alleged irregularities and noticed grave omissions and commissions in the functioning of the Bank. Accordingly, a report was submitted to the Commissioner for Co-operation and the Registrar of the co-operative Societies Act on 19-3-2003. That apart, the Reserve Bank of India also issued their inspection report on the financial position of the Bank on 2-7-2003. In the circumstances, so as to protect the interest of the depositors, shareholders and creditors of the Bank, the 1st respondent vide proceedings dated 4-10-2003 ordered statutory enquiry under Section 29 (2) of the AP MACS Act, 1995 into the working of the Bank with reference to the variations pointed out by the Reserve Bank of India and preliminary enquiry report dated 19-3-2003 authorising the District co-operative Officer, Guntur to conduct enquiry. On receipt of the statutory enquiry report, the 1st respondent - Registrar of Co-operative Societies by letter dated 5-6-2004 directed the District Co-operative officer of the Bank to convene a General body meeting within 45 days and place the enquiry report before the General Body as required under Section 31 (a) of the ap MACS Act, 1995. In the meanwhile, the District Collector, Guntur vide letter dated 26-5-2004 with a copy to Reserve Bank of India recommended to the 1st respondent to supersede the managing committee of the Bank in the interest of the depositors, shareholders as well as creditors under section 36-A of the AP MACS Act, 1995 read with Section 115-B (iii) of the A. P. Co-operative Societies Act, 1964. Based on the report of the District Collector, the 3rd respondent, Reserve Bank of India vide letter dated 30-6-2004 requisitioned the 1st respondent to supersede the Board of Directors of the Bank. Accordingly, the impugned proceedings were passed by the 1st respondent superseding the Board of directors of the Bank. The said decision was taken by the 1st respondent to safeguard the interest of the public deposits and good management of the Bank. Several other aspects about the inspection conducted by the Reserve Bank of India with regard to the functioning and the alleged irregularities found in the functioning of the Bank in the inspection conducted by the Reserve bank of India as well as the preliminary enquiry report dated 19-3-2003 were mentioned in detail which need not be traversed since both the writ petitions are filed primarily questioning the authority of the first respondent to pass the impugned order of supersession. ( 5 ) A separate counter-aifidavit has been filed by the Reserve Bank of India on the same lines. ( 6 ) I have hsard the learned Counsel for both the parties and perused the material on record. ( 7 ) AT the outset, it is to be noted that the A. P. Mutually Aided Co-operative societies Act, 1995 (Act No. 30 of 1995)was enacted to provide for voluntary formation of Co-operative Societies reliant business enterprises, based on thrift, self-help, and mutual aid and owned, managed and controlled by the members for their economic and social betterment and for the matters connected thereto or incidental thereto. ( 8 ) FOR proper appreciation of the controversy involved, the relevant provisions under the A. P. Mutually Aided Co-operative societies Act, 1995 may be noted as under: ( 9 ) SECTION 2 (d) of the AP MACS act defines co-operative Society as under :"co-operative Society means a Mutually aided Co-operative Society registered under section 4 whose bye-laws prohibit it from raising share capital from the Government, a co-operative Society registered under section 7 of the Andhra Pradesh Co-operative societies Act, 1964, if it amends its bye-laws where necessary to be in accordance with this Act, and returns to the government its share capital, if any, and either enters into a Memorandum of understanding with the Government for any outstanding loans due to, or guarantees given by the Government or returns to the government of such assistance and further gets itself registered under Section 4 as a co-operative Society under this Act. "section 2 (r) of the AP MACS Act defines registrar as under:"registrar means the Registrar of Mutually aided Co-operative Societies appointed under Section 4 of this Act, and includes any other person on whom all or any of the powers of the Registrar under this Act are conferred. " ( 10 ) SECTION 4 (4) of the AP MACS act empowers the Registrar to register a co-operative society and also its bye-laws and communicate by registered post a certificate of registration, if he is satisfied that the application for registration is in conformity with the requirements of the Act and that the proposed bye-laws are not contrary to the provisions of the Act. ( 11 ) SECTION 29 (2) of the AP MACS act which deals with the powers of the Registrar to conduct enquiry runs as under :"the Registrar may, of his own motion, and shall on the application, of a federation to which the Co-operative Society concerned is affiliated, or of a creditor to whom the co-operative Society is indebted or of not less than one-third of the Director, or of not less than one-tenth of the members, hold an enquiry or cause an enquiry to be made into the specific matter or matters relating to any gross violation of any of the provisions of this Act by the Co-operative society. " ( 12 ) SECTION 40 of the AP MACS Act which provides for dissolution of the Co-operative society by the Tribunal runs as under:"40. " ( 12 ) SECTION 40 of the AP MACS Act which provides for dissolution of the Co-operative society by the Tribunal runs as under:"40. Dissolution by Tribunal : (1) The registrar or an interested person may, after giving the Co-operative Society ninety days notice of the proposed application, apply to the Tribunal for an order dissolving the Co-operative Society, where he has reasonable cause to believe that the Co-operative society has no right to be or to be recognised as a Co-operative Society, because it, (a) obtained its registration by fraud or mistake; (b) is serving illegal purposes; (c) has wilfully, after notice by the registrar, violated any of the provisions of this Act or its bye-laws; (d) is no longer operating in accordance with principles of co-operation and the provisions of this Act; (e) has not commenced business within two years of the date of registration; or (f) has not carried on business for the past two consecutive years. (2) Where an interested person applies in pursuance of this section, he shall give the registrar notice of his application and the registrar is entitled to appear and be heard in person or by Counsel. (3) Where the Tribunal receives an application in pursuance of this section it may, after giving a reasonable opportunity to the Co-operative Society to state its cases, order that the Co-operative Society be dissolved or liquidated and dissolved under the supervision of the Registrar. (4) Where the Registrar receives an order made in pursuance of sub-section (3), he shall (a) Where the order is to dissolve the Co-operative society issue a certificate of dissolution; or (b) Where the order is to liquidate and dissolve the Co-operative Society under the supervision of the Registrar, publish a notice in a newspaper published or distributed in the district in which the registered office of the Co-operative society is situated. " ( 13 ) SECTION 41 of the AP MACS Act which empowers the Registrar to appoint a liquidator runs as under :"41. Appointment of liquidator : (1) Where a Co-operative Society is to be dissolved and no liquidator is appointed by the general Body or the Tribunal, the Registrar may, (a) appoint any person as a liquidator to wind up the affairs of the Co-operative society; or (b) where he is satisfied that the Co-operative society has no assets and liabilities, issue a certificate of dissolution. (2) The appointing authority shall fix the payment to the liquidator for his services. " ( 14 ) IT is also relevant to note that subsequently by way of amendment under act No. 29 of 1998 Section 36-A was inserted under which certain provisions of the A. P. Co-operative Societies Act, 1964 were made applicable to all Co-operative banks. The said Section 36-A runs as under:"36-A. Application of Chapter XIII-A of the andhra Co-operative Societies Act, 1964 : the provisions of Chapter XIII-A containing sections 115-A and 115-B of the Andhra pradesh Co-operative Societies Act, 1964 shall mutatis, mutandis apply to all Co-operative Banks. Explanation :for the purpose of this section a "co-operative Bank means a society registered under this Act, which is doing the business of Banking as defined in clause (b) of sub-section (1) of Section 5 of the Banking Regulation Act, 1949 (Central act 10 of 1949)" ( 15 ) A perusal of Section 36-A of the act shows that the provisions of Chapter xiii-A of the A. P. Co-operative Societies act containing Sections 115-A and 115-B shall mutatis mutandis apply to all Co-operative banks which are defined as societies registered under the A. P. Mutually aided Co-operative Societies Act, 1995 doing business of banking as defined in clause (b) of sub-section (1) of Section 5 of the Banking Regulation Act, 1949. ( 16 ) SECTION 115-A under Chapter XIII-A of the A. P. Co-operative Societies Act contains various definitions including eligible co-operative Bank as defined under the deposit Insurance Corporation Act, 1961. Section 115-B under Chapter XIII-A of the a. P. Co-operative Societies Act which is made applicable to the A. P. MACS Act is a special provision applicable to the eligible Co-operative Banks which empowers the Reserve Bank of India in the public interest or for preventing the affairs of the Bank from being conducted in a manner detrimental to the interests of depositors, to require the supersession of the committee of management or other management body and the appointment of special officer therefor. ( 17 ) IT is not in dispute that the Guntur co-operative Urban Bank Limited is an eligible Co-operative Bank and therefore section 115-B under Chapter XIII-A of the a. P. Co-operative Societies Act is made applicable under Section 36-A of the AP macs Act. ( 17 ) IT is not in dispute that the Guntur co-operative Urban Bank Limited is an eligible Co-operative Bank and therefore section 115-B under Chapter XIII-A of the a. P. Co-operative Societies Act is made applicable under Section 36-A of the AP macs Act. ( 18 ) HOWEVER, the learned Counsel for the petitioner while pointing out that section 36-A of the A. P. MACS Act is only an enabling provision and there is no other provision under the A. P. MACS act which empowers either the Registrar or any other Authority to supersede the managing Committee of the society registered under the AP MACS Act, contended that in the absence of source of power the mere enabling provision under Section 36-A will not confer the jurisdiction on the 1st respondent - Registrar of Co-operative societies to supersede the Bank in pursuance of the directions of the Reserve bank of India. ( 19 ) ON the other hand, the learned counsel appearing for the respondents contended that the power to supersede is conferred under Section 115-B (iii) of the a. P. Co-operative Societies Act as made applicable to A. P. MACS Act under section 36-A and therefore the impugned order is valid. ( 20 ) AT the outset, it is to be noted that chapter XIII-A of the A. P. Co-operative societies Act, 1964 was made applicable to all Co-operative Banks including a society registered under the A. P. MACS act which is doing business of banking as defined in Section 5 (l) (b) of the banking Regulation Act, 1949. Consequently, section 115-A and Section 115-B of the a. P. Co-operative Societies Act are equally applicable to the societies registered under a. P. MACS Act and the special provisions mentioned under Section 115-B of the a. P. Co-operative Societies Act shall apply to a society registered under the. A. P. MACS act which is doing business of banking. ( 21 ) IN the case on hand, admittedly, the impugned order of supersession was passed in exercise of such powers under section 115-B (iii) of the A. P. Co-operative societies Act read with Section 36-A of the a. P. MACS Act. A. P. MACS act which is doing business of banking. ( 21 ) IN the case on hand, admittedly, the impugned order of supersession was passed in exercise of such powers under section 115-B (iii) of the A. P. Co-operative societies Act read with Section 36-A of the a. P. MACS Act. The said provision may be extracted hereunder :"115-B. Special Provisions applicable to eligible Co-operative Banks: notwithstanding anything in this Act, the following provisions shall apply to an eligible co-operative bank, namely : (iii) if so required by the Reserve Bank in public interest or for preventing the affairs of the bank from being conducted in a manner detrimental to the interests of Depositors or for securing the proper management of the bank, an order shall be made under the provisions of this Act for the supersession of the committee of management or other management body (by whatever name called) of the Bank and the appointment of a special officer therefor such periods not exceeding five years in the aggregate as may, from time to time, be specified by the Reserve Bank; (iv ). . . . . . . . . . . . . . ; (v ). . . . . . . . . . . . . . ;" ( 22 ) WHILE interpreting the scope and object of the above provision, a Division bench of this Court in Reserve Bank of india v. Joint Registrar/district Co-operative officer, 2004 (6) ALD 699 = 2004 (6) ALT 335 (DB), held as under :"there is a clear distinction between section 34 and Section 115-B (iii) of the a. P. Co-operative Societies Act, 1964. As can be seen the two provisions are independent and the circumstances to exercise the power under the said two sections are entirely different. Whereas under Section 115-B (iii) deals with the power of the RBI to pass orders in public interest or for preventing the affairs of the Bank being conducted in a manner detrimental to the interests of the depositors or for securing the proper management of the Bank, Section 34 deals with supersession of the committee if in the opinion of the registrar the committee is not functioning properly or wilfully disobeys or fails to comply wilfully with any lawful order or direction issued by the Registrar under the Act or the Rules. It is relevant to note that in view of the non-obstante clause incorporated, Section 115-B (iii) of the Act overrides the provisions of Section 34. Section 115-B specifically states that it is applicable not withstanding anything contained in the said Act. Thus it is clear that the provisions of Section 115-B (iii)are independent to that of Section 34 and that the right of hearing as contemplated under Section 34 of the Act stands excluded. " ( 23 ) THE Division Bench further held that once a direction is issued by the reserve Bank of India, the Registrar has no discretion in the matter, but to supersede the committee and appoint an Administrator and explained as under :"the words under the provisions of the Act incorporated in clause (iii) of Section 115-B would only enable the Registrar who is the competent authority under the Act to make an order in terms of the directive of the RBI and nothing more. Once, it is held that the requisition of the RBI is binding, no further discretion is left to the Registrar and therefore the opportunity as contemplated under Section 34 of the Act cannot be insisted upon. " ( 24 ) SO far as the requirement to give an opportunity of making a representation before taking a decision to supersede the board of Directors, the Division Bench while observing that the provisions of Section 115-B (iii) are independent to that of Section 34 of the A. P. Co-operative Societies Act, held that the exclusion of Section 34 from the scheme of Section 115-B (iii) did not entitle the RBI to unilaterally take a decision regarding the supersession without affording an opportunity of making a representation to the elected Managing Committee. ( 25 ) IN the light of the ratio laid down by the Division in Reserve Bank of Indias case (supra), it is clear that Section 115-B is an independent provision and that the power exercisable under Section 115-B is entirely different from the power conferred on the Registrar under Section 34 of the a. P. Co-operative Societies Act, 1964. ( 26 ) HENCE, the contention of the petitioners that the impugned order is without jurisdiction since the AP MACS Act does not contain any provision empowering the Registrar or any other authority to supersede a Managing Committee of the society is without any substance and cannot be accepted. ( 26 ) HENCE, the contention of the petitioners that the impugned order is without jurisdiction since the AP MACS Act does not contain any provision empowering the Registrar or any other authority to supersede a Managing Committee of the society is without any substance and cannot be accepted. ( 27 ) FOR the aforesaid reasons, notwithstanding the fact that the A. P. MACS act does not contain a provision similar to section 34 of the A. P. Co-operative societies Act for supersession of the managing Committee, in exercise of the powers under Section 36-A of the A. P. MACS Act read with Section 115-B (iii) of the A. P, Co-operative Societies Act, the rbi is competent to direct the Registrar to supersede the Managing Committee which is binding on the Registrar. However, before taking such a decision, it is incumbent on the RBI to afford a reasonable opportunity to the concerned Bank to explain the allegations. ( 28 ) SINCE admittedly, in the case on hand, no opportunity of making a representation was afforded to the elected body of the Guntur Co-operative Urban bank Limited before a decision was taken by the RBI to supersede the Board of directors of the Guntur Co-operative Bank limited, as held by the Division Bench in reserve Bank of Indias case (supra), the impugned order, being in violation of the principles of natural justice, is liable to be set aside on that ground alone. ( 29 ) ACCORDINGLY, both the writ petitions are allowed and the impugned order is set aside leaving it open to the respondents to take appropriate proceedings afresh following due process of law. No costs.