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Karnataka High Court · body

2009 DIGILAW 1033 (KAR)

Sanjay B. Patil v. State of Karnataka, Rep. by its Secretary to Government, Department of Co-operation

2009-12-18

S.ABDUL NAZEER

body2009
Judgment : 1. Since common questions of law and fact are involved in all these writ petitions, they are clubbed together, heard and disposed of by this common order. 2. In these petitions, the petitioners have challenged the order at Annexure-A dated 22.09.2009 passed in No.JRL/E/207/SSN/2008-09 by the 3rd respondent removing the managing committee of the Bijapur District Central Co-operative Bank Ltd. (hereinafter referred to as ‘the Bank’) and appointing an administrator or manage its affairs. The petitioners were elected as the members/directors of the managing committee of the Bank in the election held on 19.03.2008 for the term of five years. The managing committee consists of 12 members, who were elected by the members of the society. The 1st petitioners in W.P. Nos.28728-734/2009 is the President of the managing committee of the Bank since 1997. 3. It is contended that since the election of the aforesaid managing committee of the Bank, it has seen an upward trend due to the efforts of all the members including the petitioners. The Bank has been earning profits in crores. The Bank is administered efficiently and smoothly and has been raking profits of crores for the last several years. The activities of the Bank have been expanded continuously without scope for any complaint by the public and the beneficiaries. The members of the managing committee of the Bank, its shareholders and the beneficiaries are striving to enhance the performance of the Bank. It is further contended that the Bank has been selected as one of the best District Central Co-operative Banks in the Karnataka State. Sri.Shivanand S. Patil, the present President of the managing committee of the Bank was a member of the Legislative Assembly elected on the Congress ticket. There is a rivalry between Sri.Shivanand S.Patil and his opponents Dr.Sarvabhoma Bagali, Sri. S. K. Bellubbi, Sri Ramesh B. Bhusnur and Hon’ble in-charge Minister of Bijapur District Sri Govind Karjola (all Members of Legislative Assembly elected on the BJP ticket). Sri. Shivanand S. Patil has contested the legislative assembly general election and lost to a BJP candidate. 4. It is contended that Dr. Sarvabhoma Bagali, Sri. Ramesh B. Bhusnur and Sri. S. K. Bellubbi along with Sri. Gulappa Shetagar have lodged complaints to the Hon’ble Minister for Co-operation against the management committee of the Bank, who in turn forwarded the complaints to the Managing Director of the Apex Bank. 4. It is contended that Dr. Sarvabhoma Bagali, Sri. Ramesh B. Bhusnur and Sri. S. K. Bellubbi along with Sri. Gulappa Shetagar have lodged complaints to the Hon’ble Minister for Co-operation against the management committee of the Bank, who in turn forwarded the complaints to the Managing Director of the Apex Bank. The Managing Director directed the internal auditor of the Apex Bank to enquire into the matter and submit a report. It is further contended that complaints lodged by the aforesaid persons, forwarding the copies of the complaints by the Hon’ble Minister for Co-operation to the Managing Director of the Apex Bank and directions from the Managing Director of the Apex Bank to its internal auditor are the result of prejudice and political rivalry of complaints against Sri.Shivanand S. Patil. 5. During the year 2005, the Bank with an intention to establish a training centre proposed to acquire certain lands bearing Sy. Nos 51/1 and 51/2, Mahalbagayat, Bijapur Hobli, Bijapur Taluk and District, which is adjacent to the Head Office of the Bank. The Bank made representations to the concerned revenue authorities requesting for acquisition of the land and provide the same to the Bank to carry out its objects. The Bank incurred expenses for acquisition of the land and deposited the money with the revenue authorities. The revenue authorities initiated proceedings for acquisition of land in accordance with law.Sri. Gulappa Shetagar and the Hon’ble in-charge Minister of Bijapur District, Sri. Govind Karjola has an interest in the said land. Sri. Gulappa Shetagar with the assistance of Sri. Govind Karjola, colluding with the Government authorities got the acquisition proceedings withdrawn. The State Government has unilaterally passed an order 21.10.2008 withdrawing the acquisition proceedings initiated at the instance of the Bank. Being aggrieved by the said order, the Bank filed a writ petition No.4068/2008 before this Court. This Court by its order dated 16.1.2009 quashed the aforesaid order and directed the Principal Secretary Revenue Department, Government of Karnataka, to hear the Bank and pass appropriate orders thereon. 6. The Principal Secretary, Revenue Department, Government of Karnataka, heard the Bank and the said Sri. Gulappa Shetagar on 13.03.2009 and submitted his statement opposing acquisition of land for the Bank and also produced a report dated 19.02.2009 prepared as per the directions of the Managing Director of the Apex Bank. Sri. 6. The Principal Secretary, Revenue Department, Government of Karnataka, heard the Bank and the said Sri. Gulappa Shetagar on 13.03.2009 and submitted his statement opposing acquisition of land for the Bank and also produced a report dated 19.02.2009 prepared as per the directions of the Managing Director of the Apex Bank. Sri. Gulappa Shetagar produced a copy of the said statement before the Principal Secretary, Revenue Department, Government of Karnataka. On the next date of hearing, Sri. Gulappa Shetagar submitted on more report dated 21.2.2009 which is prepared as per the directions of the Managing Director of the Apex Bank. The Principal Secretary, Government of Karnataka, by his order dated 23.3.2009 upheld Bank’s contentions ordered for continuance of acquisition proceedings for 2 acres of land. 7. In the interregnum, the MLAs lodged the complaints with the Hon’ble Minister for Cooperation with an oblique motive to destabilize the elected body and overthrow the elected members by adopting back door methods and to stall the land acquisition proceedings initiated according to law. Subsequently, the Hon’ble Minister for Cooperation forwarded the said complaints to the Managing Director of the Apex Bank. The Apex Bank appointed one Sri. K. H. Thimmaiah, internal auditor and Joint Director of Co-operative Society to conduct inquiry/inspection with respect of complaints lodged against the management of the Bank. Sri K. H. Thimmaiah alleged to have conducted inspection/inquiry without issuing notice or intimation to the members of the managing committee of the Bank. 8. The Joint Registrar of Co-operative Societies, Belgaum Division (for Short ‘JRCS’) the 3rd respondent herein, issued a show cause notice under Section 30(1) of the Karnataka Co-operative Societies Act, 1959 (hereinafter referred to as `the Act’) on 24.08.2009 to the members of the managing committee of the Bank calling upon them to submit their explanation on or before 2.9.2009. On the same day, he has sent the letter dated 24.8.2009 under Section 30(4) and (5) of the Act to the Reserve Bank of India (R.B.I.), National Bank for Agriculture and Rural Development (NABARD) and Apex Bank to offer their remarks on the proposed action under Section 30(1) of the Act. The petitioners submitted a representation dt.26.08.2009 requesting the JRCS to provide sufficient time to submit their explanation to the show cause notice dt.24.08.2009. The JRCS passed an order 2.9.2009 extending time up to 14.9.2009 to furnish explanation to the show cause notice. The petitioners submitted a representation dt.26.08.2009 requesting the JRCS to provide sufficient time to submit their explanation to the show cause notice dt.24.08.2009. The JRCS passed an order 2.9.2009 extending time up to 14.9.2009 to furnish explanation to the show cause notice. It is contended that after examining the show cause notice dated 24.8.2009 issued by the JRCS, the petitioners came to know that in the notice, the 3rd respondent has reiterated the inquiry reports dated 19.2.2009 and 21.2.2009 submitted by Sri. K. H. Thimmaiah, who was appointed at the instance of the complainants. Without obtaining the copy of the complaints, the alleged report submitted by Sri. K. H. Thimmaiah and the actions taken pursuant to the said report, they were unable to submit their explanation. Therefore, they submitted applications dated 10.9.2009 and 11.09.2009 under the provisions of the Right to Information Act to the 2nd and 3rd respondents seeking certified copies of the complaints, the directions issued by the Hon’ble Minister for Co-operation, the directions issued by the 2nd respondent and reports referred in the cause show notice dated 24.08.2009. Since the 3rd respondent fixed the time limit up to 14.09.2009 to submit the explanation to the show cause notice, they submitted their interim explanation on 14.09.2009 and requested for grant of some more time to file their reply as they are in the process of obtaining the documents which are necessary to meet the allegations made in the show cause notice. Between the evening of 17.09.2009 and the evening of 19.09.2009, the respondents furnished some of the documents sought for by the petitioners under the letter dated 17.09.2009. However, the respondents did not furnish the copies of the complaints and the other documents. It is contended that the Apex Bank has sent a letter dated 16.09.2009 to all its Directors intimating convening of management committee meeting on 25.09.2009. The Apex Bank has also circulated agenda for the meeting along with the letter dated 16.09.2009. One of the agenda of the meeting to be held on 25.9.2009 is providing remarks of the Apex Bank under Section 30(4) of the Act relating to superseding of the Bank. Since the petitioners have sought time to furnish the documents and submit their explanation, they believed that after the furnishing the document, the JRCS would grant time to submit their explanations. Since the petitioners have sought time to furnish the documents and submit their explanation, they believed that after the furnishing the document, the JRCS would grant time to submit their explanations. It is further contended that the petitioners were also waiting for the issue of other documents. However, the JRCS exercising the power under Section 30(1) of the Act passed the impugned order superseding committee of management of the Bank and appointing the Deputy Commissioner of Bijapur District as its Administrator. 9. The 3rd respondent has filed statement of objections in W.P. Nos.28728-734/2009. It is contended that the business activity of the Bank may be good, but, that does not mean that the functioning of the committee of the management are perfect and beyond scrutiny according to law. It is contended that the present committee of management has come into existence from 1.4.2008 and as such they cannot claim the credit of the performance of the previous committee placing the Bank in ‘A’ class and earning the profit of Rs.265.20 lakhs and NPA around 4.71% as it has no relevance while considering the conduct of the committee of management’s willful default, violations of the provisions of the Act, Rules, and bye-laws and also violations of the guidelines issued by the Registrar of Co-operative Societies and NABARD. The indulgence of the President and other Directors of the Bank amounting to mismanagement of the affairs of the Bank and misuse of powers cannot be washed away just because the Bank has earned profit. The administration is the personal attribute of each and every director of the Bank, more so, that of the President of the Bank. The acts of the committee of management and that of the President are under question and the irregularities committed by them are pointed out and an explanation is called for from them. It is further contended that the charges framed in the show cause notice speaks that all was not well in the functioning of the committee of management. It has denied the issuance of the show cause notice at the instance of Sri. Ghulappa and some other persons. The complaints were lodged to the Registrar of Co-operative Societies with a copy to the Minister and Apex Bank, in pursuance of which, the Registrar has directed by the JRCS attached to the office of the Registrar to visit the Bank and enquire into the complaints. Ghulappa and some other persons. The complaints were lodged to the Registrar of Co-operative Societies with a copy to the Minister and Apex Bank, in pursuance of which, the Registrar has directed by the JRCS attached to the office of the Registrar to visit the Bank and enquire into the complaints. The 3rd respondent visited the Bank and has made a thorough investigation with regard to the complaints and submitted a report to the Registrar. The Apex Bank has also conducted an inspection and submitted a report. As such, the 3rd respondent is statutorily bound to take action whenever and wherever any of the Co-operative societies registered under the Co-operative Societies Act, 1959 are functioning in violation of the provisions of the Act, and the Rules made thereunder, the bye laws and the guidelines issued by the Government, RBI and NABARD. It is admitted that the petitioners have sought for two months time for filing the objections. The charges framed in the show cause notice are pertaining to the loans sanctioned by the committee of Management which is the part of the proceedings of the committee of management which was in the custody of the committee of management. As such, the question of obtaining documents under the Right to Information Act is absurd. However, certain documents sought for have been supplied to the petitioners. Hence, the petitioners are not entitled for opportunity of personal hearing because the provisions do not contemplate personal hearing. The 3rd respondent has sought to justify the impugned order superseding management committee of the Bank. 10. The 5th respondent in W.P.Nos.28728-734/2009 has also filed his statement of objections. It is contended that the impugned order is appealable under Section 106 of the Act. Since the alternative remedy available to the petitioners is efficacious in nature, the writ petitions should not be entertained. It is further contended that the petitioners have made allegations against Sri.Gullappa and the District in-charge Minister without impleading them as parties to the writ petitions. Therefore, the writ petitions are liable to be dismissed on that ground alone. It is further contended the petitioners were elected as members of the managing committee on 19.03.2008 for a period from 1.4.2008 to 31.3.2013. Therefore, the writ petitions are liable to be dismissed on that ground alone. It is further contended the petitioners were elected as members of the managing committee on 19.03.2008 for a period from 1.4.2008 to 31.3.2013. In the month of November 2008, Dhyanayogi Shri. Shivakumar Swamiji Sugars Ltd., Hirebevanur (hereinafter referred to as ‘the Company’) applied to the Bank for sanction of hypothecation loan (working capital) of Rs.400 lakhs, harvesting and transport loan of Rs.300 lakhs and loan for construction of godown for Rs.150 lakhs. The 1st petitioner Sri. Shivanand Patil is a stakeholder as also the Chairman of the Board of Directors of the company. At the time of making the application for grant of loan, Company had accumulated loss Rs.21,08,48,000/-, its negative net worth was Rs.598.17 lakhs and its share value was nil. It was indebted to other lenders to the tune of Rs.13.21 crores and had also received deposits of Rs.6,60,00,000/-. The said company was also in default of payment of liability for purchase of cane to the tune of Rs.615.73 lakhs. The said company had a liability of Rs.196.60 lakhs to the Bank out of which Rs.107.99 was overdue and the interest liability was Rs.72.39 lakhs. For recovery of its dues, the Bank had already initiated recovery proceedings before the Registrar of Co-operative Societies under Section 70 of the Act. The policy and guidelines regarding financing sugar mills by SCBs and DDBs are laid down in the circular No.245/PCD.55/2003-04 issued by NABARD. It is provided that CC (hypothecation) limits for stores and spares (including gunny bags) could be sanctioned/renewed by banks up to 120% of the average maximum utilization of the limits during the preceding three years of Rs.2.00 crores whichever is less. Withdrawals under such limits would be have to be permitted only against fresh stock of consumable and packaging material purchased for the sugar season i.e. purchase on 1st July of the year. It was not eligible for any hypothecation loan beyond the limits prescribed by the NABARD. There is no provision for sanctioning loan for construction of godown or harvesting and transportation. More so, there was no security for the said loans and as such, grant of loan could not have been considered. In the light of the dismal financial position as also in the light of the directives of NABARD, it was impermissible to sanction the loan. More so, there was no security for the said loans and as such, grant of loan could not have been considered. In the light of the dismal financial position as also in the light of the directives of NABARD, it was impermissible to sanction the loan. Accordingly, a note was put up by the Managing Director of the Bank before the managing committee. The Deputy Registrar of Co-operative Societies, who is the ex-officio member of the managing committee, objected to the sanction of loan. The Managing committee despite having noted the impermissibility of sanctioning loan, went ahead and passed three separate resolutions on 05.12.2008 sanctioning the hypothecation loan of Rs.300 lakhs, harvesting and transportation loan of Rs.300 lakhs and godown loan of Rs.150 lakhs. One Somesh Patil, who is closely related to the 1st petitioner had dues to the Bank and Bank had obtained an award against him in the proceedings under Section 70 of the Act. Somesh Patil also applied for loan and was sanctioned Rs.60 lakhs by the Bank on 26.11.2008 despite he being a defaulter. The loan sanctioned to the said Somesh Patil was credited in his account on 6.12.2008 and on 8.12.2008. He transferred Rs.50,00,000/-to the personal account of the 1st petitioner. Immediately after crediting the loan amount in the account of the Company, the amount was misappropriated to refund the amount collected from the third parties. It is further contended that the complaints having been received, the JRCS submitted a report after investigation into the allegations against the managing committee of the Bank prima facie indicating persistent commission of various acts prejudicial to the interest of the Bank and other members. The JRCS and internal auditor of the Apex Bank have also submitted a report indicating the persistent default from the managing committee. The managing committee thereafter in its meeting held on 25.3.2009 adverted to the aforesaid reports of the JRCS and internal auditor of the Apex Bank admitting that the Company was not eligible for loan and yet was sanctioned loans pursuant to the show cause notice. The petitioners filed reply on 14.09.2009 explaining the charges leveled against members of the management. In the circumstances, the JRCS has passed the order impugned herein. 11. I have heard Sri. The petitioners filed reply on 14.09.2009 explaining the charges leveled against members of the management. In the circumstances, the JRCS has passed the order impugned herein. 11. I have heard Sri. P.S. Rajagopal, Learned Senior Counsel appearing for the petitioners in W.P. No.28726/2009, Sri Jayakumar S. Patil, Learned Senior Counsel appearing for the petitioners in W.P. Nos.28728-734/2009, Sri. Basavaprabhu S. Patil, Learned Senior Counsel appearing for the respondent for the respondent-Bank, Sri. Keshava Reddy, Learned AGA and Sri.S.S. Kumman, Learned GA appearing for the official respondents. 12. Learned Counsel for the petitioners would contend that the petitioners were elected to the managing committee of the Bank on 1.4.2008 for a term of 5 years. The supersession of the managing committee of the Bank has serious adverse civil consequences. Having regard to the proviso to sub Section 3 of Section 30 of the Act, the member of the committee removed under Section 30(1) of the Act is not eligible for being elected as a member of the committee for a period of four years from the date of supersession of the committee. Section 30(1) of the Act provides for supersession of the committee, after giving the committee an opportunity to state its objections. The petitioners were not provided with a reasonable opportunity to show cause to the notice. It is argued that the show cause notice was issued on 24.08.2009 and it stipulated time limit up to 2.9.2009 to file reply. The notice was served on the petitioners on the petitioners on 25.08.2009, which did not specify the basis for supersession. Therefore, the petitioners filed an application on 10.09.2009 for extension of time to reply the show cause notice and sought for certain information. Thereafter, reserving liberty to file a further reply after receiving information, an interim reply was filed on 14.09.2009. The information sought was provided on 19.09.2009. After furnishing of the information, no opportunity was given to submit their reply. The JRCS submitting himself to external dictation, passed the impugned order. Thus, the proceedings before JRCS was contrary to Section 30(1) of the Act. It is further argued that the JRCS ought to have granted an opportunity of personal hearing. It is argued that the order is vitiated for non-consultation with the financing Bank. The JRCS submitting himself to external dictation, passed the impugned order. Thus, the proceedings before JRCS was contrary to Section 30(1) of the Act. It is further argued that the JRCS ought to have granted an opportunity of personal hearing. It is argued that the order is vitiated for non-consultation with the financing Bank. It is further submitted that the JRCS having referred the matter to the Karnataka State Co-operative Apex Bank Limited under Section 30(4) of the Act found it inconvenient to wait for the view of the said Bank for the reasons that the said Bank has recognised the Bank as one of the well managed Banks and has placed before its Board meeting proposing to grant third prize in appreciation of the performance of the Bank under the self-same director for the year ending 31.03.2008 classifying the Bank as “A” in audit rating. The petitioners wanted to examine the report submitted by Sri. K. H. Thimmaiah and all Annexures to the said report. The petitioners wanted to know the directions issued by the respondent-authorities from time to time. Without ascertaining the above facts, it was not possible for the petitioners to effectively defend their case and submit their explanation to the JRCS. It is further contended that the President of the Bank was a member of the legislative assembly elected on a congress ticket and contested the general legislative election on congress ticket and lost election to a BJP candidate. The complainants who are the sitting MLAs from BJP. Thus, there is a political rivalry between them. The complaints lodged by sitting MLAs are against Shivanand Patil. The JRCS without following the consequences provided under Section 30(1) and (4) of the Act and without receiving the explanation/objection from the petitioners has proceeded to pass the order, which is contrary to law. It is further argued that the objection filed in the writ petitions by the Bank is contrary to the stand taken by the Bank in its reply filed before the JRCS dated 14.09.2009 16. On the other hand, Learned Counsel for the respondent-Bank while supporting the impugned order submits that the order impugned is appealable under Section 106 of the Act. It is argued that the matter involves disputed questions of fact. The alternative remedy available to the petitioners is efficacious in nature. Therefore, the writ petitions should not be entertained by this Court. On the other hand, Learned Counsel for the respondent-Bank while supporting the impugned order submits that the order impugned is appealable under Section 106 of the Act. It is argued that the matter involves disputed questions of fact. The alternative remedy available to the petitioners is efficacious in nature. Therefore, the writ petitions should not be entertained by this Court. He has taken me through the impugned order ‘and submitted that the Bank is persistently negligent in the performance of its duties. It has committed acts which are prejudicial to the interest of the Bank. It is further argued that the Bank has not been functioning in accordance with the provisions of the Act, the Rules and the Bye laws. Therefore the JRCS had no other option but to supercede the managing committee of the Bank. 17. Sri Keshava Reddy, Learned Addl. Government Advocate appearing for the official-respondents has also sought to justify the impugned order. It is argued that the reasonable opportunity has been afforded to the petitioners to file a reply to the show cause notice. It is further argued that the over all performance of the Bank has no relevance while considering the conduct of the management’s willful default, violations of the provisions of the Act, Rules, and bye-laws and also violations of the guidelines issued by the Registrar of Co-operative Societies and NABARD. Learned AGA at the time of his arguments has conceded that there is no evidence of persistent default or persistent negligence. He submits that the action taken against the Bank should be tested under Section 30(1)(b) of the Act. It is further argued that the reasons for seeking two months time are that the documents required for filing objections sought under the Right to Information Act are uncalled for because all the charges framed in the show cause notice are pertaining to the loans sanctioned by the committee of Management which is the part of the proceedings of the committee of management which are required to be reduced into writing in the form of resolution in the minutes book, which was in the custody of the committee of management. As such, the question of obtaining documents under the Right to Information Act is absurd. Certain documents sought for were available with them. They are not entitled for opportunity of personal hearing as the section does not provide for the same. As such, the question of obtaining documents under the Right to Information Act is absurd. Certain documents sought for were available with them. They are not entitled for opportunity of personal hearing as the section does not provide for the same. Therefore, the violation of principles of natural justice does not arise. He prays for dismissal of the writ petitions. 18. Before dealing with the order contentions urged by Learned Counsel for the parties, let me consider the contentions of the Learned Counsel for the respondent Bank as to the availability of the alternative remedy to the petitioners for challenging the impugned order. The order passed by the JRCS superceding the committee of management of the Bank is under Section 30 of the Act. A perusal of Section 30 of the Act shows that the order has to be passed by the Registrar in accordance with law. Sub Section (1) of Section 2 of the Act defines the ‘Registrar’, means a person appointed to perform the functions of the Registrar of Co-operative Societies under the Act, and includes and Additional Registrar of Co-operative Societies, a Deputy Registrar of Co-operative Societies and an Assistant Registrar of Co-operative Societies appointed to assist the Registrar when exercising all or any of the powers of the Registrar. That is how, the JRCS has passed the order impugned under Section 30 of the Act. The order impugned herein is appealable under Section 106 of the Act. The sub section 1(e) of Section 106 of the Act states that subject to the provisions of Section 108-A of the Act, an appeal shall lie against the order of the Registrar removing the committee of a Co-operative society made under Section 30 of the Act. As per sub-Section 2 of Section 106 of the Act, an appeal against any act, decision or order was made by the Registrar. If the act, decision or order was made by any other Officer, the appeal shall lie to that Officer’s immediate Superior Officer. 19. Admittedly, the Registrar is the immediate superior officer of the JRCS. But the question is whether the Registrar being the Appellate Authority is able to deal with the appeal objectively, fairly and impartially. In this connection, it is relevant to note that the Minister for Co-operation sends a note to the Registrar dated 3.2.2009 along with the complaints received by him from the three MLAs. But the question is whether the Registrar being the Appellate Authority is able to deal with the appeal objectively, fairly and impartially. In this connection, it is relevant to note that the Minister for Co-operation sends a note to the Registrar dated 3.2.2009 along with the complaints received by him from the three MLAs. Learned GA has produced copy of the said note of the Minister and certain other documents along with a memo dated 12.11.2009. On the said memo, the Registrar ordered for holding an enquiry and submission of the report. In obedience of the said order, the JRCS has constituted a committee for holding an enquiry. It appears that the committee submitted its report, which was forward by the JRCs to the Registrar. The Registrar by a communication dated 13.03.2009 (Annexure-Q in W.P. No.28726/2009) has informed the JRCS (the 3rd respondent) about the receipt of an enquiry report the JRCS (Urban Bank) attached to the office of the Registrar. The communication states that allegations made in the complaint against the President of the Bank are prima facie established, that he can take action against the committee and the President and that the matter requires action. He has enclosed a report of the internal auditors of the Apex Bank along with the said letter and has directed the JRCS to examine the complaints and take appropriate action and to submit an action taken report. The said communication is as under: KANNADA: The Registrar having directed for holding an enquiry and received the report, instead of merely forwarding the report of the JRCS, gives directions to the JRCS to take action after coming to the conclusion that the president and members of the committee of the management of the Bank are prima facie guilty. 20. An essential process of judicial process is that a judge has to be impartial, neutral and to be in a position of apply his mind objectively to the dispute before him. This is known as rule against bias. Bias disqualifies an individual from acting as a judge flows from two principles (1) No one should be a judge of his own case, (ii) justice must not only be done but seen to have been done. This is known as rule against bias. Bias disqualifies an individual from acting as a judge flows from two principles (1) No one should be a judge of his own case, (ii) justice must not only be done but seen to have been done. Proceedings before a Judge may be vitiated if he is biased, if there are factors, which may influence him to improperly favour one party at the cost of the other party. 21. In M.SACHIDANANDAN vs. ASST. GENERAL MANAGER & OTHER (ILR 1998 KAR 3175) – this Court was considering the validity of an order of the disciplinary authority. In the said case, the petitioner was working as an Officer in the Bank. A show cause notice signed by the Assistant General Manager of the Bank was issued to the petitioner. Reply was furnished by the Officer to the show cause notice. Since the disciplinary authority was not satisfied with the explanation offered by the petitioner, the matter was referred to the disciplinary authority for initiating disciplinary enquiry. The disciplinary authority passed an order imposing certain punishments on the petitioner. An appeal was preferred by the petitioner before the Appellate Authority who was none other than the Assistant General Manager, who had issued the show cause notice. The Appellate Authority rejected the appeal thereby confirming the order of the disciplinary authority. Learned Counsel for the petitioner contended that the order passed by the Appellate Authority is opposed to the rules of justice, the reason being the Appellate Authority must be deemed to be biased since the adjudicator of the appeal had personal knowledge of the material facts of the case. In this connection, the Court held that official bias is likely to arise when an adjudicator has previous knowledge of the material facts of the case before him by virtue of his dealing with those facts in some other capacity. In such cases, the possibility of pre-dispositions hovering over the mind of an adjudicator for or against a party in the case before him cannot be ruled out and there is every possibility and probability that the administration of justice was less than fair. Further, there is every possibility that the adjudicator, who has adjudicated between the parties, has not adjudicated the matter with an independent mind and without learning towards one party or other. The Court has further held as under: “7. Further, there is every possibility that the adjudicator, who has adjudicated between the parties, has not adjudicated the matter with an independent mind and without learning towards one party or other. The Court has further held as under: “7. It is an elementary rule of natural justice that a person who tries a case should be able to deal with the matter before him objectively, fairly and impartially. The word ‘impartially’ is the antonym of the word ‘partiality’ or bias. Bias is a condition of mind, which sways judgment and renders judge unable to exercise his functions impartially in a particular case. Bias on the part of the person acting in a judicial capacity is called ‘Judicial Bias’. The broad principle evolved by the Courts is that a person trying a cause even in quasi-judicial proceedings must not only act fairly but must be able to act above suspicion of unfairness. This is based on the Maxim which is often repeated that justice should not only be done but should be seen to be done.” It has been further held as under: “9. …………………………………. After completion of departmental enquiry proceedings, on an appeal filed by the delinquent officer, the same authority who had issued the notice, in the capacity of the Appellate Authority decides the appeal and rejects the same. It is the apprehension of the petitioner that justice is not been done to him by the Appellate Authority, who has personal knowledge of the material facts of the case and had rejected his explanation. In a case like this, official bias is likely to arise when an adjudicator has previous knowledge of the material facts of the case before him by virtue of his dealing with those facts in some other capacity. In such cases, the possibility of the pre-dispositions hovering over the mind of an adjudicator for or against a party in the case before him cannot be ruled out and there is every possibility and probability that the administration of justice was less than the adjudicator, who has adjudicated between the parties, has not adjudicated the matter before him with an independent mind and without leaning towards one party or other. In my view, nothing is to be done which created a doubt or suspicion in the mind of the party that there has been an improper interference in the cause of justice. In my view, nothing is to be done which created a doubt or suspicion in the mind of the party that there has been an improper interference in the cause of justice. Where the officer who had issued the show cause notice and who had rejected the defence of the delinquent also hears the appeal and decides it, any reasonable person will definitely entertain a reasonable apprehension that his case has not been considered on its merits and justice has not been considered on its merits and justice has not been done to him. In cases of this nature, the test is not whether in fact the judicial bias and the official bias has affected the judgment. The test is whether a litigant could reasonably apprehend that bias attributable to the Appellate Authority might have operated against him in the final decision. It is in this sense, that it is often said that injustice must not only be done but also appears to be done.” 22. Rule of exclusion of writ jurisdiction by availability of an alternative remedy is a rule of discretion and not one of compulsion. In appropriate cases, in spite of availability of alternative remedy, High Court may still exercise its writ jurisdiction. The Apex Court in HARBANSLAL SAHNIA & ANOTHER vs. INDIAN OIL CORPORATION LIMITED & OTHERS ( (2003) 2 SCC 107 ) – has held as under: “The rule of exclusion of writ jurisdiction by availability of an alternative remedy is a rule of discretion and not one of compulsion. In an appropriate case, in spite of availability of the alternative remedy, the High Court may still exercise its writ jurisdiction in at least three contingencies; (i) where the writ petition seeks enforcement of any of the fundamental rights; (ii) where is failure of principles of natural justice; or (iii) where the orders or proceedings are wholly without jurisdiction or the vires of an Act is challenged.” 23. It is evident from the succeeding paragraphs that the order impugned is also violative of the principles of natural justice. In the circumstances, it is not just and reasonable to direct the petitioner to file an appeal before the Registrar because no purpose will be served by filing such an appeal. 24. The decision relied on by Sri.Basava Prabhu S. Patil, Leaned Senior Counsel in U.P. SPINNING CO. LTD. Vs. In the circumstances, it is not just and reasonable to direct the petitioner to file an appeal before the Registrar because no purpose will be served by filing such an appeal. 24. The decision relied on by Sri.Basava Prabhu S. Patil, Leaned Senior Counsel in U.P. SPINNING CO. LTD. Vs. R. S. PANDEY ((2005) 8 SC 264) states that writ petition should be not entertained when statutory remedy is available unless exceptional circumstances are made. In the present case, petitioners have made out a case for entertaining the writ petition despite availability of alternative remedy. 25. The JRCS issued notice to the petitioners under Section 30(1) of the Act dated 24.08.2008 and directed them to submit their explanation to the show cause notice on or before 2.9.2009. The JRCS on the same day i.e, on 24.8.2009 also sent the letter dated 24.8.2009 under Sections 30(4) and (5) of the Act to the RBI, NABARD, and the Apex Bank to offer their remarks on the proposed action under Section 30(1) of the Act, which is clear from Annexure-J. Subsequently, the petitioners submitted a representation dated 26.08.2009 requesting the JRCS to provide sufficient time to submit their explanation to the show cause notice dated 24.08.2009. The said representation is at Annexure-K. The JRCS passed an order dated 2.9.2009 extending time up to 14.9.2009 to furnish explanation to the show cause notice dated 24.08.2009 as per Annexure-L. Without obtaining the complaints lodged by the complainants, the alleged report submitted by Sri. K. H. Thimmaiah and the action taken pursuant to the said report, the petitioners were unable to submit their explanation to the show cause notice dated 24.8.2009. Therefore, the petitioners submitted applications dated 10.9.2009 and 11.09.2009 under the provisions of the Right to Information Act to the 2nd and 3rd respondents seeking certified copies of the complaints lodged by the complainants, directions issued by the Hon’ble Minister for Co-operation, directions issued by the 2nd respondent and reports referred to in the show cause notice dated 24.08.2009. Since the JRCS fixed the time limit up to 14.09.2009 to submit the explanation to the show cause notice dated 24.08.2009, on 14.09.2009, the petitioners submitted their interim explanation and requested for grant of some more time as they are in the process of obtaining the documents, which are necessary to meet the allegations made in the show cause notice dated 24.08.2009. The explanation is at Annexure-N. On 17.09.2009 and 19.09.2009, the respondents furnished some of the documents sought for by the petitioners under the letter dated 17.09.2009. However, it is clear that the respondents have not furnished the copies of the complaints lodged by the complainants and the other documents. It is the case of the petitioners that since they sought for time to furnish the documents and submit their explanation to the show cause notice, they believed that after furnishing the documents before 17.09.2009, the JRCS would grant time to them to submit their explanation. However, the JRCS has passed the impugned order on 22.09.2009 superceding the committee of management of the Bank. The contention of the respondents is that the documents sought for were very much available with the petitioners cannot be true. The report submitted by Sri. K. H. Thimmaiah and other documents were with the authorities concerned. Therefore, the petitioners were justified in seeking some more time to file their objections. Without granting reasonable time, the JRCS has passed the impugned order. It is evident from the letter of the Registrar to the JRCS dated 13.03.2009 that he has prima facie come to a conclusion that the petitioners are guilty of misconduct and has directed the JRCS to take appropriate action and submit an action taken report. Therefore, a question arises as to whether the JRCS has passed the order with an independent mind. From the events stated above, it looks as though the adjudicating authority has passed the order under the diction of a superior authority. It is settled that any decision taken by a statutory authority at the behest or on the suggestion of a person, who has no statutory role to play is ultra viruses (See BAHADURSINH LAKHUBHAI GOHIL vs. JAGDISHBHAI M. KAMALIA & OTHERS ( (2004) 2 SCC 65 )-The order involved serious civil consequences. The duly elected committee of management has been superceded by the impugned order. The members of the committee removed are not eligible for being elected for a period of four years from the date of supersession of the committee. In the circumstances, the JRCS ought to have given adequate opportunity to the petitioners meet the case against them. I am of the view that since this minimum has not been done, the principles of natural justice have been violated. In the circumstances, the JRCS ought to have given adequate opportunity to the petitioners meet the case against them. I am of the view that since this minimum has not been done, the principles of natural justice have been violated. Learned Counsel for the parties have advanced arguments at length on the merits of the matter. All these questions have to be considered by the JRCS after granting reasonable opportunity to the petitioners to file their reply. 26. In the light of the above discussion, I pass the following: ORDER .(I) The Writ petitions succeed and they are accordingly allowed. The order passed by .(ii) The petitioners are granted time till 15.02.2010 to file their additional objections to the 3rd respondent-Joint Registrar of Co-operative Societies, Belgaum, dated 22.09.2009 (Annexure-L in W.P.No.28728-734/2009 and Annexure-T in W.P.No.28726/2009) is hereby quashed. the show cause notice dated 24.08.2009. (iii) The 3rd respondent-Joint Registrar of Co-operative Societies, Belgaum, is directed to consider the said objections and pass appropriate orders thereon in accordance with law on or before 15.04.2010 without being influenced by the contents of the communication of the Registrar dated 13.3.2009 (Annnexure-Q in W.P. No.28726/2009). .(iv) The Deputy Commissioner, Bijapur District or any other authority who has been appointed as an administrator to look after the affairs of the Bank is directed to hand over the charge of the Bijapur District Central Co-operative Bank Limited, Bijapur, to the petitioners forthwith. .(v) The petitioners are restrained from taking any policy decisions till the disposal of the matter by the 3rd respondent-Joint Registrar of Co-operative Societies, Belgaum, in accordance with this order. No costs.