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Judgment
Shorn of all the details, the petitioner in the instant writ petition assails the order passed by the first respondent, the Registrar of Co-operative Societies, Government of Andhra Pradesh, Hyderabad, in RC N0.68614/98-L1, dated 22-9-1998 rejecting the revision petition filed by him u/s 77 of the Andhra Pradesh Co-operative Societies Act, 1964, (for short ''the Act'').
The petitioner joined the services of the second respondent-Bank as Manager (Accounts) in August, 1990 and later on promoted as Deputy Managing Director and as at present is the Managing Director (under suspension). The Board of Directors of the second respondent-Bank through its resolution dated 3-9-1998 kept the petitioner under suspension pending inquiry into the allegations. The petitioner is alleged to have committed several irregularities in sanctioning loans and cash credit. He is also alleged to have involved in mis-appropriation of bank funds under the head ''Cheque discounting'' in King-Koti Branch. The same is stated to have come into light during the Audit report and the Auditors are stated to have submitted their special report to the District Co-operative Audit Officer, Hyderabad, for which a statutory inspection is ordered by the Registrar of Co-operative Societies u/s 52 of the Act. No opinion need be expressed with regard to the said allegations levelled against the petitioner. The allegations, obviously, are all subject-matter of inquiry and it would not be appropriate to say even a word about the same. No doubt Sri Nooty Rama Mohan Rao, learned Counsel for the petitioner made an attempt to invite the Court''s attention to sonic proceedings, in support of his submission that the order is the result of high-handed and malicious action on the part of the Chairman of the Bank. It is not possible to look into the details of the allegations and express any opinion even for the purposes of the disposal of this writ petition, as any observation from this Court may cause avoidable prejudice to the parties, including the petitioner. The decision has been taken, obviously, by the entire Board of Management of the Bank; and not by any single individual. The allegations are not trivial and flimsy in nature. The said allegations require elaborate and impartial inquiry.
However, the petitioner had chosen to make serious allegations against the Chairman and the Board of Directors of the Bank; whereas the order suspending the petitioner says that the petitioner is interfering into the affairs of the Bank and is trying to destroy the evidence both in the Head-office and in King-Koti Branch, He is trying to exert undue influence on the witnesses. Obviously, there is internecine war between the petitioner and the Chairman of the Bank. The petitioner, himself, in the affidavit filed in support of the writ petition, rightly says that he is not traversing any of the allegations made or the defence which he may have in support of those allegations, as the matter is likely to be inquired into when the respondents consider it necessary to do so.
However, the learned Counsel for the petitioner mostly confined his submissions with regard to the validity of the order dated 22-9-1998 passed by the Registrar of Cooperative Societies. The petitioner had challenged the order dated 3-9-1998 passed by the second respondent-Bank before the first respondent herein by way of a revision petition u/s 77 of the Act. The Registrar through the impugned order rejected the revision petition filed by the petitioner holding that he has no jurisdiction whatsoever to interfere with the order of suspension either u/s 77, 76(2) or 4(2) of the Act. The order in my considered opinion docs not suffer from any infirmity whatsoever warranting interference of this Court. The decision arrived at by the Registrar is perfectly correct.
Section 77 of the Act confers revisional jurisdiction upon the Registrar to call for the records from any Officer subordinate to him and examine the same to satisfy himself as to the regularity of such proceedings or the correctness, legality or propriety of any decision passed or order made therein; but, not in respect of a proceeding in respect of which an appeal to the Tribunal is provided by sub-section (1) of Section 76 of the Act. It is abundantly clear that the Registrar is entitled to call for the records only from an officer subordinate to him and he is conferred with no jurisdiction to call for and examine the records of any Cooperative Society as such. The Act is a self contained one. The Co-operative Society cannot be treated as a subordinate to the Registrar. By any stretch of imagination it can be said that a Co-operative Society is an officer subordinate to the Registrar within the meaning of Section 77 of the Act. A Cooperative Society once it is registered under the Act becomes body corporate by the name under which it is registered having perpetual succession and a common seal. It is entitled to acquire, hold and dispose of the property. The ultimate authority of the Society shall always vest in the General Body and the General Body constitutes and elects the committee for the purpose of entrusting the management of the affairs of the Society. To characterise the Cooperative Society as an Officer subordinate to the Registrar is fraught with serious consequences. The learned Counsel would immediately place reliance upon Section 4(2) of the Act which declares that every society registered under the Act shall function subject to such directions as may be issued by the Registrar from time to time and would like to read it along with the power conferred upon the Registrar u/s 77 of the Act. In my considered opinion, even Section 4(2) of the Act to be read along with Section 77 also does not confer any jurisdiction upon the Registrar to pass any order in an individual case and to interfere with the order as such passed by the Society. The Registrar is entitled to issue directions from time to time which arc general in nature in the interest of the cooperative movement or the public interest or in order to prevent the affairs of the society from being conducted in a manner detrimental to the interests of the members or of the depositors or creditors thereof. As such Section 4(2) of the Act confers power upon the Registrar to issue directions which are general in nature and not with reference to any specific order as such. An order of the Society suspending its employee can never be treated as an order adversely effecting the co-operative movement or public interest or detrimental to the interest of the members or of the depositors or the creditors.
The learned Counsel invites the attention of the Court to Section 59 of the Act which again authorises the Registrar to direct the committee to place or cause to be placed such paid officer or servant under suspension, when it is brought to his notice during the course of inquiry u/s 50, 51 or 52 that such paid officer or servant is responsible for mis-appropriation, breach of trust or the other offence, in relation to the society. This section confers power upon the Registrar to direct the Society to keep its officer under suspension, where the Society failed to take appropriate action against its paid officer or servant inspite of adverse audit and inspection report revealing commission of mis-appropriation, breach of trust or other offences by such paid officer or servant of the society, so that the Society may not conduct its affairs in a manner detrimental to the interest of the Members of the Society or of the Depositors or Creditors thereof. It does not confer any power upon the Registrar to revoke an order of suspension passed by the society.
A Society registered under the Act cannot be reduced to the level of a satellite. It can never be treated as a subordinate to any of the officers under the Act, including the Registrar. No Officer, including the Registrar has any power or jurisdiction to interfere in the day-to-day affairs and management of any Society. Even Sections 4(2), 59 and 77 read together do not confer any such power upon any officer enabling them to interfere in the day-to-day management and affairs of the Society. This, in sum and substance appears to be true nature and scope of Sections 4(2), 59 and 77 of the Act.
For all the aforesaid reasons, the Registrar, in my considered opinion, has taken absolutely correct decision and rightly rejected that revision petition filed by the petitioner as not maintainable. The Registrar had rightly declared that he has no jurisdiction in the matter. Any observations made in this order shall have no bearing whatsoever upon the merits of the case. The petitioner is entitled for reasonable opportunity of being heard in the proceedings and inquiry, if any required to be made in an impartial manner. The Court has not expressed any opinion whatsoever with regard to the allegations levelled against the petitioner.
The writ petition fails and it is accordingly dismissed at the admission stage.