Allowed

The Board of Management of Perumpazhuthoor Service Co-Operative Bank Ltd. NO.T-262 v. Shaibu.S

Kerala HC29 Mar 2022WA/342/2022

Case brief

AI extract

What is this about?

Two co-operative society members appealed against a Single Judge's dismissal of a writ petition challenging a Registrar's inspection order. The Court held that the order violated Rule 66 which mandates specific points for inspection, prohibiting roving inquiries.

What did the court decide?

The impugned judgment of the Single Judge was set aside, and the inspection order (Exts.P1, P9) and subsequent order (Annexure A1) were quashed.

The Board of Management of Perumpazhuthoor Service… — Cooperative Societies | Kerala HC (2022)

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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 P.B.SURESH KUMAR

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THE HONOURABLE MRS. JUSTICE C.S. SUDHA

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TUESDAY, THE 29^TH DAY OF MARCH 2022 / 8TH CHAITHRA, 1944

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WA NO. 342 OF 2022

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AGAINST THE JUDGMENT DATED 25.02.2022 IN WP(C) 31464/2018 OF HIGH COURT OF KERALA

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APPELLANTS/PETITIONERS:

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1 THE BOARD OF MANAGEMENT OF PERUMPAZHUTHOOR, SERVICE CO-OPERATIVE BANK LTD. NO.T-262 P.O. PERUMPAZHUTHOOR, NEYYATTINKARA, THIRUVANANTHAPURAM DISTRICT, REPRESENTED BY ITS PRESIDENT, S.K. JAYACHANDRAN.

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2 PERUMPAZHUTHOOR SERVICE CO-OPERATIVE BANK LTD. NO. T 262, REPRESENTED BY ITS SECRETARY, P.SASIKALA, P.O. PERUMPAZHUTHOOR, NEYYATTINKARA, THIRUVANANTHAPURAM DISTRICT. BY ADV P.V.BABY

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RESPONDENTS/RESPONDENTS:

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1 SHAIBU.S,

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CHANDRA, SHINE NIVAS, MAMPUZHA KARA, P.O. PERUMPAZHUTHOOR, NEYYATTINKARA 695 126.

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2 ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES (G), NEYYATTINKARA, THIRUVANANTHAPURAM DISTRICT 695 121.

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3 JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES (G), THIRUVANANTHAPURAM DISTRICT 695 001.

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Writ Appeal No.342 of 2022

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4 MARY PUSHPPAM M,

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NEYYATTINKARA UNIT INSPECTOR, OFFICE OF THE ASSISTANT REGISTRAR OF COOPERATIVE SOCIETIES (G), NEYYATTINKARA, THIRUVANANTHAPURAM DISTRICT 695 121.

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SRI.PREM NAVAZ SRI.V.K SUNIL SR GP

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THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 29.03.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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Writ Appeal No.342 of 2022

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P.B.SURESH KUMAR & C.S.SUDHA, JJ.

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Writ Appeal No.342 of 2022

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Dated this the 29^th day of March, 2022.

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JUDGMENT

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P.B.Suresh Kumar, J.

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This writ appeal is directed against the judgment dated 25.02.2022 in W.P.(C) No.31464 of 2018. The appellants were the petitioners in the writ petition.

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The second appellant is a co-operative society registered and functioning under the Kerala Co-operative Societies Act, 1969 (the Act) and the first appellant is the Board of Management of the second appellant society. In terms of Ext.P1 order, the third respondent, the Joint Registrar of cooperative societies exercising powers of the Registrar of cooperative societies under the Act in respect of the second

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Writ Appeal No.342 of 2022

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appellant society, directed an inspection of the books of the second appellant society invoking his power under Section 66 of the Act on certain matters relating to the administration of the society. The fourth respondent is the officer authorised by the third respondent to conduct the inspection. In terms of Ext.P1 order, the fourth respondent was directed to complete the inspection within 60 days and the said term was later extended by four months from 17.08.2018 in terms of Ext.P9 order issued by the third respondent. Exts.P1 and P9 orders were under challenge in the writ petition mainly on the ground that Ext.P1 order contravenes Rule 66 of the Kerala Cooperative Societies Rules, 1969 (the Rules) in as much as the specific point or points on which the inspection is ordered is not made mention of in the order. It was also urged by the appellants in the writ petition that Ext.P9 order is illegal in as much as the time limit prescribed for conducting the inspection cannot be extended after the expiry of the time originally fixed. It was also urged by the appellants that at any rate, the time limit prescribed for inspection cannot be extended without

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Writ Appeal No.342 of 2022

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there being any request by the officer authorised to conduct the inspection.

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The learned Single Judge repelled the contentions urged by the appellants and dismissed the writ petition. As regards the contention raised by the appellants that Ext.P1 order contravenes Rule 66 of the Rules, the learned Single Judge found that the order conforms to the requirements of the Rule. As noted, the appellants are aggrieved by the decision of the learned Single Judge.

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It is brought to our notice that after the

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disposal of the writ petition, in terms of an order passed by the third respondent on 09.03.2022, another officer was appointed in the place of the fourth respondent to conduct the inspection ordered in terms of Ext.P1 order. The said order is produced in the appeal as Anenxure A1.

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Heard the learned counsel for the appellants as also the learned Government Pleader.

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The only point pressed into service by the

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learned counsel for the appellants at the time of hearing was

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Writ Appeal No.342 of 2022

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that the learned Single Judge has not correctly adverted to the argument advanced by the appellants on the basis of Rule 66 of the Rules. It was argued by the learned counsel that Rule 66 of the Rules mandates that an inspection under the said rule can be made only on specific point or points, and a roving inspection is not contemplated under the said provision. Per contra, the learned Government Pleader asserted that there is no infraction of Rule 66 of the Rules in the matter of passing Ext.P1 order and there is absolutely no reason to interfere with the decision of the learned Single Judge on that ground.

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Rule 66 (1) of the Rules which is relevant in the

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context reads thus:

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66.Procedure for the conduct of inquiry and inspection :- (1)(i) An order, authorising inquiry under Section 65 or inspection under Section 66 shall among other things, contain the following:

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(a) the name of the society whose affairs are to be inquired into or whose books of accounts are to be inspected:

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(b) the name of the person authorised to conduct the inquiry or inspection;

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Writ Appeal No.342 of 2022

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(c) in specific point or points on which the inquiry or inspection is to be made, the period within which the inquiry or inspection is to be completed and report submitted to the Registrar;

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(d) costs of inquiry or inspection;

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(e) any other matter relating or pertaining to the inquiry or inspection. (underline supplied)

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As indicated in the Rules, an inspection of the books of a society can be ordered by the Registrar invoking the power under Section 66(2) of the Act only on a specific point or points, i.e, on a detailed and exact point or points, in contradistinction to a roving inspection. Obviously, the object of the Rule is to ensure that the powers under Section 66(2) is not abused for fishing out materials with oblique motives. The operative portion of Ext.P1 order reads thus:

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ഉതരവ

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റ� 262 ആ� നമർ പ�ര�മഴ�ത�ർ സർവ�സ� സഹകരണബ�ങ�പ� ന�യമനങൾ, അ�ഗത! വ�തരണ�, വ�യ# വ�തരണ�, ക�ട�ശ�ക ന�വ�രണ�, പ��ത� ഫണ�ന�പ( വ�ന�യയ�ഗ� എന�വ സ�ബന�ച� പ�യത/ക�ച��

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Writ Appeal No.342 of 2022

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സ�ഘത�ന�പ( സ�മത�ക സ�ത�, പ�വർതന�, ഭരണ�, വ/��ര പ�വർതനങൾ എന�വ സ�ബന�ച� പ��ത�വ�യ�� യകരള സഹകരണന�യമ� വക�പ� 66 പ�ക�ര� �ര�യ6�ധന നടത�നത�ന� പനയ�റ�ൻകര അസ�സന�(� രജ�സ�പട�ർ (ജന(ൽ) ആഫ�സ�പ� പനയ�റ�ൻകര യ�ണ�റ� ഇൻസ�പ�ക?(�യ പ6�മത�.യമര��ഷ#�. എ�.പന �ര�യ6�ധന ഉയB/�ഗസയ�യ� ന�യമ�ച� ഇത�ന�ൽ ഉതരവ�ക�ന�. �ര�യ6�ധന ഉയB/�ഗസ ട� ഉതരവ� പ�ക�ര� ന�യമ�ന�സCത നട�ട� പകമങൾ ��ച� �ര�യ6�ധന നടത� ഉതരവ� ത�യത� മ�തൽ 60 B�വസത�നക� (�യപ�ർട� സമർപ�യEണത�ണ�.”

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The expression “സ�ഘത�ന�പ( സ�മത�ക സ�ത�, പ�വർതന�, ഭരണ�, വ/��ര പ�വർതനങൾ എന�വ സ�ബന�ച� പ��ത�വ�യ��" contained in the impugned order would, according to us, contravene Rule 66(1) of the Rules in as much as the same would amount to a roving and fishing inquiry generally into the matters mentioned in the order. When the Rule categorically provides that an inspection can be ordered only on a specific point or points, an inspection cannot be conducted otherwise than in accordance with the Rule.

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In the result, the writ appeal is allowed, the impugned judgment is set aside and Exts.P1 and P9 in the writ

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Writ Appeal No.342 of 2022

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petition and Annexure A1 order in the writ appeal are quashed. It is, however, made clear that this judgment will not preclude the third respondent directing inspection of the records of the second appellant in exercise of his powers under Rule 66(2) in accordance with the requirements contained in Rule 66(1) of the Rules.

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Sd/-

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P.B.SURESH KUMAR, JUDGE.

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Sd/-

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C.S.SUDHA, JUDGE.

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YKB

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Writ Appeal No.342 of 2022

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APPENDIX

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PETITIONER'S/S EXHIBITS:

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ANNEXURE A1

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TRUE PHOTOCOPY OF THE ORDER DATED 9.3.2022 ISSUED BY THE 3RD RESPONDENT.

The Board of Management of Perumpazhuthoor Service Co-Operative Bank Ltd. NO.T-262 v. Shaibu.S

Case brief

What is this about?

What did the court decide?

The Board of Management of Perumpazhuthoor Service Co-Operative Bank Ltd. NO.T-262 v. Shaibu.S

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

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