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2023 DIGILAW 163 (KER)

President, Vennoor Service Co-Operative Bank Ltd. No. 675 Vennoor, Alathur P. O. , Thrissur v. State Of Kerala, Represented By The Secretary To Government Department Of Co-Operation, Government Secretariat, Thiruvananthapuram

2023-02-15

C.JAYACHANDRAN, K.VINOD CHANDRAN

body2023
JUDGMENT : [K. Vinod Chandran, J.] 1. Whether an inspection ordered by the Joint Registrar of Co-operative Societies in a complaint by a former managing committee member, initially lodged before the Hon'ble Minister for Co-operation and forwarded from his Office, would tantamount to an action on the dictate of the Minister, is the question raised in the appeal. While agreeing with the contention of the appellant/writ petitioner that any order passed by a statutory authority on the dictate of a superior would be ex-facie illegal, the learned Single Judge found there is no such illegality in the present case, where the Hon'ble Minister merely forwarded the complaint without any specific instruction or direction. The learned Single Judge distinguished the various authorities placed before Court by the writ petitioner wherein the ground of an essential dictate by the superior was very evident. 2. Sri George Poonthottam, learned Senior Counsel appearing for the appellant, in addition to the above ground, also took us through S. 66 of the Kerala Co-operative Societies Act, 1969(for brevity 'the Act') to contend that a satisfaction of the authority as evident from the order, is necessary before the inspection is ordered. In the present case based on a report of the Assistant Registrar, the inspection was ordered, which is not the satisfaction of the authority conferred with the power to order inspection. It is pointed out that when there is an application of a creditor of the Society, satisfaction is required under the proviso to S.66(2) of the Act, which is applicable even when a suo motu action is taken. Further, an inspection commenced could go on endlessly and in the present case, even after ten months from the order, the inspection is going on with various complaints added on, to the original complaint. It was also pointed out that Ss.65 and 66 are wide powers conferred on the Registrar which can be suo motu exercised and which requires a satisfaction, at least a subjective satisfaction of the Registrar before initiating an enquiry under S.65 or an inspection under S.66. 3. Learned Senior Government Pleader Sri. Vipin Das stoutly opposed the grounds raised on behalf of the appellant. It was pointed out that S.65 and S.66 are different insofar as the language employed and the power conferred. 3. Learned Senior Government Pleader Sri. Vipin Das stoutly opposed the grounds raised on behalf of the appellant. It was pointed out that S.65 and S.66 are different insofar as the language employed and the power conferred. A suo motu action can be on a prima facie consideration and in the present case the Registrar was cautious enough to get a report from the Assistant Registrar (General) before an inspection was ordered. Reference is made to Sub-Sec.(11) of S.66 which permits the Registrar to inspect the affairs of a Society on any petition received. In the present case there is no dictate from the Hon'ble Minister and it is a mere forwarding of a complaint, fully understanding the fact that it is the statutory authority who has to look into the same. 4. The contention regarding a dictate is urged based on the fact that the complaint produced as Ext.P6 filed by the Hon'ble Minister was forwarded to the Registrar with the mere recital to 'examine' (OTHER LANGUAGE) in the vernacular. We cannot find any instruction or direction issued to the Registrar and the same only indicates a transmission of the complaint to the appropriate authority for examination under the statute. As we noticed the learned Single Judge had specifically dealt with the precedents relied upon, to find that all of them are clearly distinguishable. Kottayam Co-operative Bank Ltd. v. State of Kerala ( 1988 (1) KLT 827 ) was a case in which the Minister passed an order directing the Joint Registrar to restrain the bank from proceeding with a recruitment, which neither the Government nor the Joint Registrar were competent to do. Panicker Kadavu Consumer Co-Society v. Registrar of Co-operative Societies (1994 KHC 387) was a case in which an enquiry initiated under S.65 was interfered with finding the same to be based on instruction from the Minister, evident from the order impugned. Managing Committee Kandallur Farmers Service Co-op. Bank Ltd. v. Joint Registrar of Co-operative Societies ( 2008(4) KHC 618 ) was a supercession under Section 32 pursuant to an enquiry under S.65, which enquiry was triggered by a representation to the Minister. The Court also held the initiation of proceedings under Section 32 to be vitiated for not following the statutory compulsions in Section 65 and it being based on a report of the Asst. The Court also held the initiation of proceedings under Section 32 to be vitiated for not following the statutory compulsions in Section 65 and it being based on a report of the Asst. Registrar which was obtained after hearing the parties; which report was also not put to the parties or an opportunity given to controvert the same. Calicut City Co-op. Bank Ltd. v. Registrar of Co-operative Societies ( 2010 (2) KHC 154 ) was a case in which the Hon'ble Minister had directed a vigilance enquiry to be conducted, which was forwarded by the Registrar for carrying out an investigation; without any application of mind. We do not find any such vitiating action; a direction or instruction to either carry out an enquiry or conduct an inspection, in the present case. 5. We also have to notice that S.65 & 66 are not in pari materia provisions. S.65 is an enquiry carried out by the Registrar either on his own motion or in the circumstances enumerated under clauses (b) to (f) in sub-section (1). S.65(1) also requires that before such an enquiry is ordered, the Registrar should be satisfied that it is necessary so to do. Precedents are legion that such satisfaction should not be a mere rhetoric and should emanate clearly from the order initiating such an inquiry. S.66 on the other hand, confers the Registrar with the power to supervise, by himself or through an authorised person, the working of every Society in the periodicity he considers necessary which also includes examination of the books of the Society. S.66 is a general supervisory power where the Registrar may suo motu or on the application of a creditor of the Society, carry out an inspection through himself or through a person authorised; which can also be done under sub-section (11) on any petition received. Insofar as an application by a creditor, the proviso requires a satisfaction that the debt is presently due from the Society and he has demanded payment which demand has not been honoured. The said proviso is specifically to avoid vexatious complaints being raised by a creditor against the Society. We would not for a moment think that even an inspection under Section 65 could be ordered by the Registrar with his eyes closed. The said proviso is specifically to avoid vexatious complaints being raised by a creditor against the Society. We would not for a moment think that even an inspection under Section 65 could be ordered by the Registrar with his eyes closed. However the degree of satisfaction required in exercising the general power of supervision conferred under S.66, suo motu or on any application, would be far lesser in tenor and scope and it would be more appropriate to term it a prima facie consideration of the allegations made. 6. In the present case a complaint was raised before the Hon'ble Minister. We can only find that the Hon'ble Minister, quite realising the contours of power conferred under the statute, forwarded the same to the statutory authority, the Registrar, for examination; which cannot be found fault with in the democratic set up of governance. There is absolutely no direction or instruction, compelling us to find a definite 'diktat' to the statutory authority. 7. We also see from Ext.P5 order that the Joint Registrar on receipt did not immediately direct an inspection as was the case in Calicut City Service Co-op. Bank Ltd. (supra).The Joint Registrar called for a report from the Assistant Registrar, Chalakkudy and after perusing the same was satisfied that a suo motu inspection has to be initiated. The order directing inspection also does not necessarily result in any conclusive finding as to lapses on the part of the Society. As we found, the satisfaction required in ordering an inspection under Section 66 is a tad lesser than that required in ordering an inquiry under S.66. We find no reason to interfere with the order of the learned Single Judge and dismiss the appeal in limine.