Judgment

GROVER, J.: These appeals from a judgment of the Madras High Court involve the true ambit, scope and content of Section 72 of the Madras Co-operative Societies Act, 1961 (hereinafter called the Act).

2. The facts may be briefly stated. On 4th January, 1969 the Joint Registrar of Co-operative Societies issued a Notice u/s 72 of the Act to the Committee of the North Arcot District Co-operative Supply and Marketing Society Ltd. It was stated in the notice that the Committee had not been functioning properly for some time past. Charges were mentioned in detail and the Committee was called upon to make a representation against the proposal to dissolve it in view of the defects and irregularities mentioned in the notice. After examining the representation which was quite length y and detailed, the joint Registrar recorded an Order on 11th April, 1969 dealing with each charge and holding that the Committee had not been functioning properly and had failed to perform its duties and discharge its responsibilities as required under the Act. The Committee was ordered to be suspended for a period of one year from 12th April, 1969 to 11th April, 1970. The Deputy Registrar of Co-operative Societies was appointed to work as a Special Officer and to manage its affairs for that period. The matter was taken in appeal to the Registrar by the Committee. The Registrar affirmed the Order of the Joint Registrar. Thereafter the President and the Director of the Co-operative Society moved the High Court under Article 226 of the Constitution. A number of points were taken in the writ petition but the main emphasis was laid on the proper procedure not having been followed under sections 64, 65 and 66 of the Act before taking action u/s 72.

3. The learned single Judge of the High Court allowed the writ petition which had been filed by the President and the Director of the Co-operative Society. The Learned Judge was not satisfied that there was any justification for the action taken by the Joint Registrar in the matter of supersession of the Committee. On appeals having been taken before a Division Bench under Clause 15 of the Letters Patent the case was referred to a Full Bench. The Full Bench based its decision largely on the view that the procedure laid down in Sections 64, 65 and 66 must be followed before any order could be made by the Joint Registrar or the Registrar u/s. 72. We may refer to the following portion of the judgment:

"Sections 64, 65 and 66, which are the statutory procedural stems which interdict the apparently arbitrary course of action which a Registrar could undertake to interfere with the affairs of a society, its members or officers, provide a sufficient help to tighten up such indiscriminate and unguided exercise of the powers by the Registrar, when it becomes necessary. In each of those sections it is incumbent on the Registrar to given an opportunity to the member concerned, officer concerned or the Society to rectify the defects"............

"In our view and under the scheme of the Act, the condition precedent to the exercise of jurisdiction by the Registrar under one or the other of the sections considered above and in particular Section 72 is to secure an audit memorandum or a report of inspection or inquiry, so that the may be provided with the necessary material to act thereon. Unless such a fact finding authority has provided the Registrar wit the hypothesis to act and ultimately supersede an elected body, the impugned order of supersession will undoubtedly be tainted wit the absence of a jurisdictional basis. Whether such a basis exists, is subject to review by this Court in exercise of its jurisdiction under Article 226 of the Constitution of India."

4. The Full Bench affirmed the decision of the Learned single Judge.

5. The points which have been argued before us and which have to be determined are:-

(i) Whether the Registrar before taking action u/s 72 must have an audit made u/s. 64 and inquiry held u/s 65 and an ins