K Sivasankaran Vs Joint Registrar Of Co-Operative Societies (General)

High Court Of Kerala 24 Feb 2022 Writ Appeal No. 232 Of 2022 (2022) 02 KL CK 0222
Bench: Division Bench
Result Published
Acts Referenced

Judgement Snapshot

Case Number

Writ Appeal No. 232 Of 2022

Hon'ble Bench

P.B.Suresh Kumar, J; C.S. Sudha, J

Advocates

George Poonthottam, Arun Chandran, Nisha George, V.K.Sunil

Final Decision

Dismissed

Acts Referred
  • Kerala Co operative Societies Act, 1969 - Section 63, 65, 65(1), 65(1)(a), 66(2), 68A
  • Karnataka Societies Registration Act, 1960 - Section 25(1)

Judgement Text

Translate:

,,,,

P.B.Suresh Kumar, J.",,,,

1. This writ appeal is directed against the judgment dated 02.02.2022 in W.P.(C) No.2474 of 2022. The appellant was the petitioner in the writ petition.,,,,

2. The appellant is the President of a Primary Co-operative Agricultural Credit Society registered under the Kerala Co-operative Societies Act, 1969",,,,

(the Act). As per Ext.P1 order, the Joint Registrar of Co-operative Societies exercising powers of the Registrar of Co-operative Societies under the",,,,

Act over the Society of which the appellant is the President, ordered an inquiry under Section 65(1) of the Act into the loan transactions of the Society",,,,

commencing from 01.01.2020 and also into the financial structure and stability of the Society. Ext.P1 order was issued on the basis of the reports,,,,

dated 14.09.2021 and 12.11.2021 of the Unit Inspector attached to the office of the concerned Assistant Registrar of Co-operative Societies disclosing,,,,

the irregularities noticed in the course of his inspections in the Society. The writ petition was one instituted challenging Ext.P1 order. Having regard to,,,,

the materials on record, the learned Single Judge found that the satisfaction arrived at by the Joint Registrar for ordering an inquiry under Section",,,,

65(1) of the Act cannot be said to be baseless or unfounded. Consequently, the writ petition was dismissed. The appellant is aggrieved by the decision",,,,

of the learned Single Judge and hence this writ appeal.,,,,

3. The learned Senior Counsel for the appellant contended that in the absence of any of the reports and applications referred to in clauses (b) to (f) of,,,,

Section 65(1) of the Act, an inquiry under Section 65(1) could be ordered by the Joint Registrar only ""on his own motion"" as provided for in clause (a)",,,,

of Section 65(1) on his subjective satisfaction that it is essential to order an inquiry under that provision into the constitution, working and financial",,,,

condition of the society. The learned counsel elaborated the said submission pointing out that when an inquiry is ordered by the Joint Registrar invoking,,,,

clause (a) of Section 65(1), the order should reflect the materials, on the basis of which the Joint Registrar has arrived at the subjective satisfaction as",,,,

to the requirement of ordering an inquiry under that provision and the same shall be based on materials independently collected by him. It was argued,,,,

by the learned counsel that Ext.P1 order does not disclose the materials independently sourced by the Joint Registrar and the said order was issued,,,,

solely based on the reports of the Unit Inspector, which is per se illegal and unsustainable. The learned counsel has relied on the decision of this Court",,,,

in Melukkara Service Co-operative Bank Ltd. v. Joint Registrar (General), District Co-operative Society, 2018 (2) KHC 143, in support of the said",,,,

contention. Placing reliance on the averments in paragraphs 11 to 13 of the writ petition, it was also contended by the learned counsel that the exercise",,,,

of the power under Section 65(1) in the State is always selective, having regard to the political affiliation of the managing committee, and the power is",,,,

invoked only with a view to find grounds for superseding the management of societies which do not owe allegiance to the political parties in power in,,,,

the State. According to the learned counsel, the impugned order is therefore, vitiated by malice as well.",,,,

4. We have examined the arguments advanced by the learned Senior Counsel for the appellant.,,,,

5. Section 65 of the Act reads thus:,,,,

“65.Inquiry by Registrar.- (1) The Registrar may,-",,,,

(a) on his own motion; or,,,,

(b) on an inquiry report of the Vigilance Officer appointed under section 68A; or,,,,

(c) on a report of the Director of Co-operative Audit appointed under section 63; or,,,,

(d) on an application by the majority of the members of the committee of the society, or by not less than one third of the quorum for the general body meeting,",,,,

whichever is less; or,,,,

(e) on an application by the apex society or financing bank of which such society is a member; or,,,,

(f) on an application of a society to which the society concerned is affiliated,- hold an enquiry by himself or by a person authorized by order in writing, into the",,,,

constitution, working and financial condition of the society, if he is satisfied that it is necessary so to do.",,,,

(2) The Registrar or the person authorised by him under sub-section (1) shall, for the purpose of an inquiry under this section have the following powers, namely:â€"",,,,

(a) he shall, at all reasonable times, have free access to the books, accounts, documents, securities, cash and other properties belonging to, or in the custody of the",,,,

society and may summon any person in possession of or responsible for the custody of any such books, accounts, documents, securities, cash or other properties,",,,,

to produce the same at any place at the headquarters of the society.,,,,

or at any branch thereof or where there is no working office for the society, at the office of the Registrar or at the office of any of his subordinate officers;",,,,

(b) he may summon any person who, he has reason to believe, has knowledge of any of the affairs of the society to appear before him at any place at the",,,,

headquarters of the society or any branch thereof and may examine such person on oath; and,,,,

(c) (i) he may, notwithstanding any rule or bye law specifying the period of notice for a general body meeting of the society himself call a general body meeting or",,,,

require the President or Secretary of the society to call a general body meeting at such time and place at the headquarters of the society or any branch thereof, to",,,,

determine such matters as may be directed by him;,,,,

(ii) any meeting called under sub-clause (i) shall have all the powers of a general body meeting called under the bye-laws of the society.,,,,

(3)When an inquiry is made under this section, the Registrar may communicate the result of the inquiry to the financing bank, if any, to the society to which such",,,,

society is affiliated and to the Circle Co-operative Union.,,,,

(4)When an inquiry made under this section reveals only minor defects which in the opinion of the Registrar, can be remedied by the society, he shall communicate",,,,

the result of the inquiry to the society and the society, if any, to which that society is affiliated. He shall also direct the society or its officers to take such action",,,,

within the time specified therein to rectify the defects disclosed in such inquiry.,,,,

 (5)The inquiry under this section shall be completed within a period of six months which period may at the discretion of the Registrar and for reasons to be,,,,

recorded in writing, be extended from time to time, so however that the aggregate period shall not in any way, exceed one year.",,,,

(6) If the Registrar, on completion of the inquiry finds that, there is a major defect in the constitution or working or financial condition of the society, he may initiate",,,,

action in accordance with the provisions of section 32.,,,,

As seen from the extracted provision, the Registrar is empowered to order an inquiry under Section 65(1) under any one of the six circumstances",,,,

enumerated in clauses (a) to (f) of Section 65(1). As rightly pointed out by the learned counsel for the appellant, the circumstances enumerated in",,,,

clauses (b) to (f) are absent in the case on hand and the impugned order is issued by the Joint Registrar invoking the power under clause (a) . As,,,,

noted, the argument advanced by the learned counsel for the appellant is that when an inquiry is ordered by the Joint Registrar invoking clause (a) of",,,,

Section 65(1), the same shall not be based on materials provided by others, but it shall be based on materials independently sourced by him. The",,,,

argument is obviously in the light of the expression ""on his own motion"" contained in clause (a) of Section 65(1).",,,,

6. Let us therefore, first examine the scope of the expression “on his own motionâ€. A Full Bench of the High Court of Karnataka in Bangalore",,,,

Grain Merchants Association v. The District Registrar for Societies and Others, 2001 (1) KCCR 292, had occasion to consider the meaning of the",,,,

expression “on his own motion†in the context of the enquiry provided for under Section 25(1) of the Karnataka Societies Registration Act, 1960.",,,,

It was held in the said case that the expression “on his own motion†although means “on one's own initiative†and implies application of mind,,,,

and formation of one's own opinion, it does not matter how and from what source he gets the information and it does not mean that the authority",,,,

conferred with such power should eschew from consideration the information or material furnished from external sources and should look into the,,,,

information collected by him on self effort. It was also held in the said case that the only requirement of law is that on the basis of information and,,,,

materials gathered either on its own initiative or received from other sources, the competent authority has to come to a conclusion on an active",,,,

application of mind, whether to take up the enquiry or not, and that he shall not act mechanically at the behest of others without independent",,,,

application of mind. The relevant paragraph of the judgment reads thus:,,,,

“9. Now, we come to the more crucial and controversial question i.e., what is the meaning and import of the expression 'on his own motion' and what is its inter-",,,,

relation to the immediately following clauses of the same Sub-section. There could be no doubt, that the expression 'on his own motion' is synonymous to suo-motu,",,,,

which according to the dictionary means, ""on one's own initiative"". 'Own motion' obviously implies application of mind and formation of one's own opinion. It does",,,,

,,,,

,,,,

From The Blog
Madras High Court to Hear School’s Plea Against State Objection to RSS Camp on Campus
Feb
07
2026

Court News

Madras High Court to Hear School’s Plea Against State Objection to RSS Camp on Campus
Read More
Delhi High Court Quashes Ban on Medical Students’ Inter-College Migration, Calls Rule Arbitrary
Feb
07
2026

Court News

Delhi High Court Quashes Ban on Medical Students’ Inter-College Migration, Calls Rule Arbitrary
Read More