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2019 DIGILAW 522 (KER)

Kunnathunadu Taluk Primary Cooperative Agricultural and Rural Development Bank Ltd. v. State of Kerala Represented By Its Principal Secretary to Government, Cooperative-Department, Government Secretariat, Thiruvananthapuram

2019-07-03

DEVAN RAMACHANDRAN

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JUDGMENT : 1. The petitioner, which is the Kunnathunadu Taluk Co-operative Agricultural and Rural Development Bank Ltd., (hereinafter referred to as the 'Bank' for short), has filed this writ petition, impugning Ext.P14 order of the Government of Kerala, as per which, they appear to have exercised their powers under Section 83(1)(j) of the Kerala Co-operative Societies Act ('KCS Act' for short), by entertaining an appeal preferred by the 4th respondent herein, against an order issued by the Joint Registrar of Co-operative Societies earlier. 2. The petitioner -Bank says that the 4th respondent, who is their member and had availed of large loans of more than Rs.30 lakh from them, made a frivolous complaint before the concerned Joint Registrar of Co-operative Societies and that on the allegation that the said application was not being considered, he had approached this Court, through W.P(C)No.29482 of 2017, in which, directions were issued to the Joint Registrar to dispose of the said complaint, which finally led to Ext.P12 order, wherein, the Joint Registrar of Co-operative Societies found all the allegations made by the 4th respondent to be untenable. 3. The petitioner contends that against this order, though the proper remedy for the 4th respondent ought to have been to approach the Tribunal, he filed W.P.(C)No.29482 of 2017 and obtained a judgment, dated 27.09.2017 before this Court, a copy of which has been placed on record as Ext.R4(b), along with the counter affidavit of the 4th respondent, wherein, this Court directed him to file an appeal under Section 83(1)(j) of the KCS Act and further ordered the Government to consider the same as a valid appeal and dispose it of on its merits. 4. The petitioner says that subsequently, the Government issued Ext.P14 order, without considering any of the factual factors in its proper perspective, stating that the files must be handed over to the Crime Branch for investigation, with a further direction to the Registrar of Co-operative Societies to cause a vigilance enquiry as to whether the loans in question were given in violation of law and other applicable guidelines. 5. 5. The petitioner asserts that the afore directions in Ext.P14 are beyond the competence of the Government to issue, under the provisions of the KCS Act and that the Government could not have issued an order under Section 83(1)(j) of the KCS Act in this manner, since the order of the Joint Registrar, namely, Ext.P12, was not an appealable one under these provisions. 6. The learned Senior Counsel Sri.K.P.Dandapani, instructed by Sri.Millu Dandapani, learned counsel for the petitioner -Bank, made his submissions in tune with the afore averments in the writ petition, adding that solely because this Court had, in Ext.R4(b) judgment, directed the Government to consider the appeal filed by the petitioner under Section 83(1)(j) of the KCS Act on its merits, the Government could not have done so, since statutorily, it had no jurisdiction to entertain such an appeal. He says, therefore, Ext.P14 order must be struck down, as having been issued without jurisdiction, which according to the learned Senior Counsel, could not have been vested with them even under the orders of this Court. He then went on to add that Ext.R4(b) judgment was obtained by the 4th respondent at the stage of admission and therefore, that his client was not even aware of it until the appeal was taken up and disposed of by the Government. The learned Senior Counsel, therefore, reiterateingly submits that Ext.P14 order is liable to be set aside and that all processes pursuant thereto must be directed to be terminated. 7. In response to the afore submissions made by Sri.K.P.Dandapani, the learned Senior Counsel, Sri.Vinod Bhat, the learned counsel appearing for the 4th respondent, explained that his client was, in fact, a victim of a collaborative fraud committed by the Secretary of the petitioner -Bank and respondents 6 and 7, who are private money lenders, by misusing certain stamp papers that his client had entrusted with the 6th respondent, while availing certain loans from him. Sri.Vinod Bhat vehemently submits that his client is not a member of the petitioner -Bank or had he availed of any loan from them, but that respondents 6 and 7, along with the Secretary of the Society a certain Sri.Varghese, had fabricated documents, using the stamp papers that were available with the 6th respondent; and therefore, that this is a fit case where, the Registrar should have invoked his jurisdiction under one of the relevant provisions, including Sections 65, 66 or 68 of the KCS Act. He, therefore, prays that Ext.P14 be not interdicted by this Court, so that its directions can be put into effect immediately. 8. The learned Special Government Pleader, Sri.Mohammed Hashim, appearing on behalf of the official respondents, submitted that the Government has issued Ext.P14 after carefully evaluating the materials and records available and being satisfied that the allegations made by the 4th respondent are with some force. He then says that the Government has, however, not concluded that any particular person is guilty, be that the Secretary of the Society or respondents 6 and 7, but that a proper investigation is required to be made under the provisions of law to unearth the true facts and to conclusively ascertain if anyone within the Co-operative system is guilty of the transgressions imputed by the petitioner. He also, therefore, prays that Ext.P14 be allowed to operate, since it only orders an investigation by the Crime Branch of the Police. 9. I have considered the afore submissions made on behalf of the parties very carefully and I am of the view that the directions in Ext.P14 will certainly require to be intervened by this Court for the reasons I will record below: 10. The petition preferred by the 4th respondent before the Joint Registrar, namely Ext.P15, contains very serious allegations; whether these are right or wrong can be established only through a proper enquiry. It is, therefore, necessary that an enquiry is conducted. The vital question is as to the nature of the enquiry and the manner of such. 11. That said, while the Joint Registrar of Co-operative Societies has issued Ext.P12 order without causing any enquiry, either under Section 65 or Section 66 of the KCS Act, the Government has set aside the same, through Ext.P14 order, making a factual assessment on their own and then ordering a Crime Branch enquiry. 12. 11. That said, while the Joint Registrar of Co-operative Societies has issued Ext.P12 order without causing any enquiry, either under Section 65 or Section 66 of the KCS Act, the Government has set aside the same, through Ext.P14 order, making a factual assessment on their own and then ordering a Crime Branch enquiry. 12. I am afraid that both these orders are incompetent, even if they were issued under the orders of this Court. Unfortunately, in cases like this, the orders of this Court are used as a cover by the competent Authorities to deviate from the procedural requirements as are in mandatory law. The directions of this Court are never intended to empower Authorities to act beyond their competence or in contravention of the provisions of the Act and Rules, but are issued only to empower them to act within the parameters of law. Sometimes, however, the contrary happens, as is luculently seen in this case because the Joint Registrar construed the directions of this Court in W.P.(C)No.29482/2017 to mean that he can pass an order of any kind, without even being shackled by the provisions of the Act and Rules, because in Ext.P12, it is not even clear under which provision of law he has acted under. This is pertinent because, the Joint Registrar can only act under one of the available provisions, namely, Sections 65, 66, 68 or 68(A) of the KCS Act and no other. However, a reading of Ext.P12 would not disclose as per which provision of law he has acted. Analogous is the case with Ext.P14 order passed by the Government, where again, they appear to have taken refuge under the directions of this Court in Ext.R4(b) judgment in issuing an order directing the investigation to be handed over to the Crime Branch, but without stating under what legal sanction this has been done. 13. My observations above assume importance because all the issues in this case are strictly confined to an arena which is governed and modulated by the KCS Act and Rules and therefore, the Statutory Authorities also have to act within its circumscribed limits and cannot travel outside, for whatever be the reason, including the directions of this Court, which in any event, are never intended for such purposes. 14. 14. I am, therefore, of the firm view that neither Ext.P14 nor Ext.P12 orders can find favour of this Court and that they deserve to be vacated, so as to pave way for a fresh and proper enquiry at the hands of the concerned Authorities. I say this also for the reason that an enquiry into the various aspects relating to a Society, particularly in relation to corruption and such other, are not to be done by an outside agency, which will be beyond the control of the Registrar of Co-operative Societies; but will have to be confined within the provisions of Section 68(A) wherein, the Vigilance Department, operating under the supervisory control of the Registrar, will be in a position to deal with this more effectively, finally empowering the Registrar to pass consequential orders, including under Sections 65, 68 or even Section 32 of the KCS Act. On the contrary, if a Crime Branch enquiry is done, as has been now ordered through Ext.P14, and even if employees or officials of the petitioner -Bank are implicated, the Registrar of Co-operative Societies will be inhibited in taking further action, because such process would be beyond his statutory control. Resultantly, I order this writ petition and set aside Exts.P12 and P14 orders; and consequentially, direct the concerned Registrar or the Joint Registrar of Co-operative Societies to take up the compliant of the 4th respondent, namely, Ext.P15 and consider it afresh, after affording necessary opportunity of being heard to him as well as to the authorized official of the petitioner – Bank; and then decide the kind of enquiry which will be necessary, if so found warranted, within the provisions of the KCS Act and Rules. Once an appropriate decision is taken by the Registrar/Joint Registrar of Co-operative Societies, he shall then proceed to complete such enquiry or investigation, as may be found fit by him after this exercise and the parties, thereafter, will have full liberty to invoke their remedies in law, appropriately if orders are issued to their detriment. The exercise as afore, shall be completed by the Registrar/Joint Registrar of Co-operative Societies, as expeditiously as is possible but not later than three months from the date of receipt of a copy of this judgment and the resultant order shall be communicated to both sides without any further delay thereafter.