Disposed

Aryankavu Service Co-Operative Bank LTD.NO.2965 v. the Assistant Registrar of Co-Operative Societies(General)

Kerala HC24 Sept 2021WP(C)/7573/2021

Case brief

AI extract

What is this about?

Writ petitions challenging the admission of a retired banker as a member of a cooperative society. The court held that the Joint Registrar failed to consider the bank's detailed objections and quashed the admission order, directing a fresh consideration with a hearing for both parties.

What did the court decide?

The order admitting petitioner to membership is set aside. Petitioner to be given an opportunity to file objections; 3rd respondent to consider the matter afresh after hearing both parties.

Aryankavu Service Co-Operative Bank LTD.NO.2965 Vs the… — Cooperative Societies | Kerala HC (2021)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR. JUSTICE SUNIL THOMAS

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FRIDAY, THE 24^TH DAY OF SEPTEMBER 2021 / 2ND ASWINA, 1943

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WP(C) NO. 1066 OF 2021

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PETITIONER:

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P.S.SKARIAH AGED 63 YEARS S/O. ABRAHAM, (RETIRED SECRETARY), PLATHOTTATHIL, ARYANKAVU VILLAGE, ARYANKAVU P.O., KOLLAM DISTRICT691306.

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BY ADVS. K.C.SANTHOSHKUMAR SMT.K.K.CHANDRALEKHA

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RESPONDENTS:

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1 STATE OF KERALA REPRESENTED BY THE SECRETARY TO GOVERNMENT, COOPERATIVE DEPARTMENT, GOVERNMENT OF KERALA, THIRUVANANTHAPURAM-695001.

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2 THE REGISTRAR OF CO-OPERATIVE SOCIETIES, THIRUVANANTHAPURAM-695001.

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3 THE JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL), OFFICE OF THE JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL), KOLLAM-691001.

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4 THE ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL), OFFICE OF THE ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL), PUNALUR.

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5 ARYANKAVU SERVICE CO-OPERATIVE BANK LTD. NO.2965, ARYANKAVU P.O., KOLLAM DISTRICT-691309, REPRESENTED BY ITS SECRETARY.

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6 THE SECRETARY, ARYANKAVU SERVICE CO-OPERATIVE BANK LTD. NO.2965, ARYANKAVU P.O., KOLLAM DISTRICT-691309.

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BY ADVS.

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WP(C) Nos.1066 & 7573/2021

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SRI.T.R.HARIKUMAR SRI.ARJUN RAGHAVAN

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OTHER PRESENT:

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SR.GP BIMAL K NATH

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 27.07.2021, ALONG WITH WP(C).7573/2021, THE COURT ON 24/9/2021 DELIVERED THE FOLLOWING:

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WP(C) Nos.1066 & 7573/2021

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR. JUSTICE SUNIL THOMAS

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FRIDAY, THE 24^TH DAY OF SEPTEMBER 2021 / 2ND ASWINA, 1943

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WP(C) NO. 7573 OF 2021

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PETITIONER:

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ARYANKAVU SERVICE CO-OPERATIVE BANK LTD.NO.2965 REP.BY ITS SECRETARY, ARYANKAVU P.O., KOLLAM DISTRICT 691 309

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BY ADVS. T.R.HARIKUMAR SRI.ARJUN RAGHAVAN

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RESPONDENTS:

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1 THE ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES(GENERAL) PUNALUR, KOLLAM DISTRICT PIN 691 305

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2 THE JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL) OFFICE OF THE JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL), KOLLAM PIN 691 001

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3 THE REGISTRAR OF CO-OPERATIVE SOCIETIES OFFICE OF THE REGISTRAR OF CO-OPERATIVE SOCIETIES, JAWAHARA SHAKARANA BHAVAN, DPI JUNCTION, THYCAUD P.O., THIRUVANANTHAPURAM 695 014.

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4 STATE OF KERALA REP.BY THE SECRETARY TO GOVERNMENT, CO-OPERATION (C) DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM 695 001.

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5 P.S.SKARIAH S/O.ABRAHAN, PLATHOTTATHIL HOUSE, ARYANKAVU P.O., KOLLAM DISTRICT 691 306

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BY ADVS.

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K.C.SANTHOSHKUMAR K.K.CHANDRALEKHA

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WP(C) Nos.1066 & 7573/2021

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 27.07.2021, ALONG WITH WP(C).1066/2021, THE COURT ON 24/9/2021 DELIVERED THE FOLLOWING:

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WP(C) Nos.1066 & 7573/2021

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JUDGMENT

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[WP(C) Nos.1066/2021, 7573/2021]

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Petitioner in W.P.(C) No.1066/2021 retired from the service of Aryankavu Service Co-operative Bank, the 5^th respondent, as the Secretary. After retirement from the Bank,he applied for membership in the respondent Society. Thereafter, bank informed the petitioner, by Ext.P1 that certain documents were to be produced. Thereafter, alleging that the petitioner was qualified to be a member of the society and that he was not given the membership, even after complying with all formalities, Ext.P3 complaint was laid before the 3^rd respondent. By Ext.P5 communication dated 12/6/2020 of the 3^rd respondent addressed to the bank, it was directed to give membership to the writ petitioner. By Ext.P6, the petitioner was informed by the bank that as and when the liability pending between the petitioner and the bank were cleared and the loss caused to the society due to the auction sale of gold involved in a gold loan was recovered from the petitioner, his membership will be considered. Alleging that the petitioner, though entitled to be a member, was denied the membership, he has approached this court seeking a declaration that the petitioner is entitled to be admitted as a member of the society and directing the 5^th and 6^th respondents to comply with the direction issued by the statutory authority.

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Respondent society appeared and filed a detailed counter affidavit. It was stated in the counter affidavit that, the petitioner was a former Secretary of the bank and has approached the court seeking relief suppressing material

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WP(C) Nos.1066 & 7573/2021

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facts. It was contended that, the petitioner was not qualified to be a member of the bank. The application submitted by him was incomplete and several details were not furnished. It was stated that by virtue of clause 13(3) and 13(4) of the bye laws, the petitioner was not entitled to be a member, since he has acted contrary to the interest of the bank and committed mischief against the bank. Section 17 of the Kerala Co-operative Societies Act deals with the expulsion of members. Section 17 (1) conferred the power to bank and its members to expel any person from the membership of the bank. Though clause 13 of the byelaws coupled with section 17 of the KCS Act, empowered the bank to remove any member from its membership, the same provision equally applies to removal of member who was acting contrary to the interest of the society. It was alleged by the bank that, after retirement, the petitioner was instrumental in spreading rumours against the bank and made certain members withdraw their fixed deposits. It was also contended that, the petitioner was a member of Kulathupuzha Service Co-operative Bank Ltd.,at the time of submitting application for membership in the 5^th respondent bank and hence by virtue of the statutory bar under Rule 27 of the Kerala Co-operative Societies Rules ,the petitioner was not liable to be admitted in membership.

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It was also alleged in the counter affidavit that, during the period of the petitioner, a gold auction was conducted which had caused substantial loss to the bank. Further, audit party had found that a loss of Rs.83,444/was caused to the bank by the conduct of the petitioner. The above amount

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WP(C) Nos.1066 & 7573/2021

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was liable to be recovered from him. He was also liable to pay another amount which he had drawn under the pretext that the same would be given to the consumer federation. He had also got involved in a motor accident resulting in serious injuries to another board member who passed away due to injuries. He had initiated criminal legal proceedings against the Bank. It was contended that, in the light of the above, petitioner was not entitled to be considered as a member and the committee of Bank had resolved to keep in abeyance the proceedings, till all the issues with the petitioner were resolved.

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Pending the above writ petition, the Bank approached this court by filing W.P.(C)7573/2021 assailing the order dated 12/6/2020, which was produced as Ext.P5 in W.P.(C) NO.1066/2021, on the ground that the petitioner was not liable to be admitted to membership because of various reasons stated in the writ petition. The same grounds, which were set up in the counter affidavit filed by the Bank in W.P.(C) No.1066/2021 were set up as grounds for challenging the direction of the Joint Registrar to admit the petitioner to membership.

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A reply affidavit was filed by the writ petitioner in W.P.(C). No.1066/2021 wherein, he contended that the allegations against him were absolutely false and he was entitled to be a member of the Bank. He explained the various allegations raised against him. It was also stated that he had ceased to be a member of Kulathupuzha Service Co-operative Bank and on his request, the membership stands closed.

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Heard both the writ petition together and perused the records.

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WP(C) Nos.1066 & 7573/2021

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Essentially, the communication of the Joint Registrar dated 12/6/2020 is in dispute. The records produced by the society indicates that the relationship between the petitioner and the Bank was strained. There were allegations and counter allegations. It seems that the audit party has found certain irregularities in the conduct of auction of gold ornaments. It is also seen from the records that proceedings were initiated by the Bank against the writ petitioner in W.P.(C) No.1066/2021. It is also to be seen that the managing committee of the Bank had taken a definite stand that the petitioner's request for membership can be considered only after issues with the petitioner were resolved.

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The Bank specifically referred to clause 13 (3) & (4) of the byelaws to contend that the petitioner is not competent to be a member. The Bank has a specific allegation that the petitioner had acted contrary to its interest and that he is indebted to the Bank Proceedings are pending against the petitioner.

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It is on record that, the Bank had submitted detailed objections before the Joint Registrar referring to the various grounds on which, according to them, he was not eligible to be admitted to membership. Though the Joint Registrar had passed Ext.P5 order dated 12/6/2020 holding that there is nothing to indicate that the petitioner was disqualified, on the basis of the report of the Assistant Registrar, it is clear that various objections raised by the Bank were not considered on merits by the Joint Registrar. The question whether the applicant was a member of another society as on the date of

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WP(C) Nos.1066 & 7573/2021

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application is also liable to be considered.

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In the light of the above, I feel that, the Joint Registrar is bound to apply his mind on the application submitted by the petitioner for membership on the basis of the report submitted by the Assistant Registrar also the detailed objections filed by the society and to pass a considered order. Having considered this, I feel that , the third respondent in W.P.(C) No.1066/2021 is liable to be directed to consider the entire facts afresh and to pass a considered order afresh, after giving reasonable opportunity of being heard to both sides.

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The order in W.P,.(C) No.1066/2021, which is sought to be enforced by the former Secretary, is hence liable to be set aside . By the impugned order, it is clear that the various objections raised by the Bank were not considered by the Joint Registrar. Having considered this, I feel that the third respondent in W.P(C) No.7573/2021 is liable to be directed to consider the entire facts afresh, after giving a reasonable opportunity of being heard. W.P. (C) No.7573/2021 is liable to be set aside accordingly. Main relief sought in W.P.(C) No.1066/2021 cannot be granted.

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In the result, both the writ petitions are disposed of as follows: Ext.P5 order in W.P.(C) No.1066/2021 stands quashed. W.P.(C) No.7573/2021 is disposed of. The Bank is permitted to file a detailed objection, indicating as to why according to them, writ petitioner in W.P.(C) No.1066/2021 cannot be admitted as a member. The above objection shall be filed by the society within a period of three weeks from the date of receipt

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WP(C) Nos.1066 & 7573/2021

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of a copy of this judgment. The 3^rd respondent shall, within a period of two months thereafter, consider Ext.P3 complaint in W.P.(C) No.1066/2021 and pass appropriate fresh orders on Ext.P3, after giving a reasonable opportunity of being heard to the petitioner and the society having due regard to the various contentions set up by both sides.

Sd/-

SUNIL THOMAS

Judge

dpk

WP(C) Nos.1066 & 7573/2021

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APPENDIX OF WP(C) 7573/2021

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PETITIONER EXHIBITS

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EXHIBIT	P1 A TRUE COPY OF THE COMMUNICATION DATED 28.4.2016 ISSUED BY THE SENIOR AUDITOR TO THE SOCIETY.
EXHIBIT	P2 A TRUE COPY OF THE RELEVANT PAGE OF THE LOG BOOK ALONG WITH DRIVING LICENCE OF THE 5TH RESPONDENT.
EXHIBIT	P3 A TRUE COPY OF THE COMPLAINT FILED BY THE PETITIONER BEFORE THE SUPERINTENDENT OF POLICE, KOLLAM RURAL WITH ACKNOWLEDGMENT DATED 28.7.2017
EXHIBIT	P4 A TRUE COPY OF THE REPLY DATED 23.8.2017 ISSUED BY THE PETITIONER TO THE 5TH RESPONDENT.
EXHIBIT	P5 A TRUE COPY OF THE COVERING LETTER DATED 13.9.2017 SUBMITTED BY THE 5TH RESPONDENT, ALONG WITH A NOTE OF MANAGING COMMITTEE DECISION DATED 28.9.2017
EXHIBIT	P6 A TRUE COPY OF THE LAWYER NOTICE DATED 7.5.2018 SERVED UPON THE 5TH RESPONDENT.
EXHIBIT	P7 A TRUE COPY OF THE COMMUNICATION DATED 21.1.2021 ISSUED BY THE SPECIAL GRADE AUDITOR TO THE PETITIONER SOCIETY.
EXHIBIT	P8 A TRUE COPY OF THE EXPLANATION DATED 7.3.2018 FILED BY THE PETITIONER BEFORE THE INSPECTOR OF CO-OP.SOCIETIES.
EXHIBIT	P9 A TRUE COPY OF THE COMPLAINT DATED 15.1.2020, FILED BY THE 5TH RESPONDENT BEFORE THE 2ND RESPONDENT.
EXHIBIT	P10 A TRUE COPY OF THE COMMUNICATION DATED 1.6.2020 ISSUED BY THE 1ST RESPONDENT TO THE PETITIONER SOCIETY.
EXHIBIT	P11 A TRUE COPY OF THE OBJECTION DATED 1.6.2020, FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENT.

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WP(C) Nos.1066 & 7573/2021

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EXHIBIT P12 A TRUE COPY OF THE CERTIFICATE DATED 1.7.2020 ISSUED TO THE PETITIONER SOCIETY BY THE KULATHUPUZHA SERVICE CO-OPERATIVE BANK. EXHIBIT P13 A TRUE COPY OF THE RELEVANT PAGES OF THE BYELAW OF THE PETITIONER SOCIETY. EXHIBIT P14 A TRUE COPY OF THE COMMUNICATION DATED 12.6.2020 ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER. EXHIBIT P15 A TRUE COPY OF THE COMMUNICATION DATED 20.08.2020 ISSUED BY THE PETITIONER SOCIETY TO THE 5TH RESPONDENT. EXHIBIT P16 A TRUE COPY OF THE REQUEST FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT ALONG WITH POSTAL RECEIPT DATED 10.12.2020 RESPONDENTS EXHIBITS:

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EXT.R5(A: COPY OF THE INFORMATION OBTAIEND BY THIS RESPONDENT INVOKING THE PROVISOINS OF RIGHT TO INFORMATION ACT.

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EXT.R5(B): COPY OF THE FIRST INFORMATION REPORT DATED 4/12/2015 IN CRIME NO.1425/2015 SUBMITED BY THENMALA POLICE.

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EXT.R5(C): COPY OF THE CHARGE SHEET DATED 18/4/2017 SUBMITTED BY THENMALA POLICE.

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EXT.R5(D): COPY OF THE TREATMENT CERTIFICTE ISSUED FROM THE SUIT ROYAL HOSPITAL THIRUVANANTHAPURAM

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EXT.R5(E): COPY OF THE CERTIFICATE ISSUED BY THE SECRETARY OF KULATHUPUZHA SERVICE COOPERATIVE BANK.

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EXT.R5(F): COPY OF THE PUBLIC NOTICE DATED 11/6/2015 ISSUED BY THE THEN PRESIDENT.

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WP(C) Nos.1066 & 7573/2021

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APPENDIX OF WP(C) 1066/2021

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PETITIONER EXHIBITS

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EXHIBIT P1	TRUE COPY 23.8.2017	OF THE ISSUED	COMMUNICATION DATED BY THE 6TH RESPONDENT.
EXHIBIT P2	TRUE COPY SUBMITTED	OF THE BEFORE	REPLY DATED 13.9.2017 THE 6TH RESPONDENT.
EXHIBIT P3	TRUE COPY SUBMITTED	OF THE BEFORE	REQUEST DATED 15.1.2020 THE 3RD RESPONDENT.
EXHIBIT P4	TRUE COPY 7.2.2020	OF THE ISSUED	ENQUIRY NOTICE DATED BY THE 4TH RESPONDENT.
EXHIBIT P5	TRUE COPY ISSUED BY	OF THE THE 3R	ORDER DATED 12.6.2020 D RESPONDENT.
EXHIBIT P6	TRUE COPY 20.8.2020	OF THE ISSUED	COMMUNICATION DATED BY THE 6TH RESPONDENT.
EXHIBIT P7	TRUE COPY 3.11.2020 KULATHUPU LTD., KUL	OF THE ISSUED ZHA SER ATHUPUZ	CERTIFICATE DATED BY THE SECRETARY OF VICE CO-OPERATIVE BANK HA
EXHIBIT P8	TRUE COPY 11.6.2015 THE 5TH R	OF THE ISSUED ESPONDE	PUBLIC NOTICE DATED BY THE THEN PRESIDENT OF NT SOCIETY.
EXHIBIT P9	TRUE COPY 18.4.2017 THENMALA RESPONDEN	OF THE IN CRI POLICE TS EXHI	FINAL REPORT DATED ME NO-1425/2015 OF STATION. BITS:

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EXT.R5(A): COPY OF THE RELEVANT PAGES OF THE BY LAW OF THE 5TH RESPONDENT SOCIETY EXT.R5(B): COPY OF THE CERTIFICATE DATED 1/7/2020 ISSUED TO THE 5TH RESPONDENT BY KULATHUPUZHA SERVICE CO-OPERATIVE BANK LTD. NO.1867

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WP(C) Nos.1066 & 7573/2021

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EXT.R5(C): COPY OF THE COMMUNICATION DATED 28/4/2016 ISSUED BY THE SENIOR AUDITOR TO THE 5TH RESPONDENT SOCIETY.

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EXT.R5(D):COPY OF THE LAWYER NOTICE DATED 7/5/2018 SERVED UPON THE PETITIONER.

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EXT.R5(E): COPY OF THE COMMUNICATION DATED 21/1/2021 ISSUED BY THE SPECIAL GRADE AUDITOR TO THE 5TH RESPONDENT SOCIETY.

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EXT.R5(F): COPY OF THE RELEVANT PAGE OF THE LOG-BOOK ALONG WITH DRIVING LICENSE OF THE PETITIONER.

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EXT.R5(G): COPY OF THE COMPLAINT FILED BY THE 5TH ESPONDENT BEFORE THE SUPERINTENDENT OF POLICE KOLLAM RURAL WITH ACKNOWLEDGEMENT DATED 28/7/2017

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EXT.R5(H): COPY OF THE EXPLANATION DATED 7/3/2018 FILED BY THE 5TH RESPONDENT BEFORE THE 4TH RESPONDENT

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EXT.R5(I): COPY OF THE EXPLANATION DATED 1/6/2020 SUBMITTED BY THE 5TH RESPONDENT BEFORE THE 4TH RESPONDENT.

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EXT.R5(J): COPY OF THE REQUEST BY THE 5TH RESPONDENT PLACED BEFORE THE 2ND RESPONDENT DAED NIL.

Aryankavu Service Co-Operative Bank LTD.NO.2965 v. the Assistant Registrar of Co-Operative Societies(General)

Case brief

What is this about?

What did the court decide?

Aryankavu Service Co-Operative Bank LTD.NO.2965 v. the Assistant Registrar of Co-Operative Societies(General)

Case brief

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What did the court decide?

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