IMPORTANT POINT
Prior sanction from the Registrar is mandatory for prosecution under the A.P. Co-operative Societies Act, and failure to obtain it invalidates the proceedings.

ORDER :

V. Sujatha, J.

Since the present three (03) Criminal Petitions are raised out of the F.I.R.No.140/2018 on the file of the Station House Officer, Palakol Rural Police Station, Palakol, West Godavari District, A.P., and to quash the same, all these matters are taken up together and disposed of by way of this Common Order.

2. The petitioners in Crl.P.No.10996 of 2018 are arrayed as A1 and A3, the petitioner in Crl.P.No.10857 of 2018 is arrayed as A2 and petitioners in Crl.P.No.10889 of 2018 is arrayed as A4 to A6 in F.I.R.No.140/2018 on the file of the Station House Officer, Palakol Rural Police Station, Palakol, West Godavari District, A.P., and the offences alleged against them are under Sections 468, 471, 477A 409, 420 r/w 34 of IPC.

3. The brief facts of the prosecution case is that the petitioners herein are the President, Secretary, Sales Man and NMRs of Gorintada Primary Agricultural Co-operative Society Limited, Gorintada, Palakol Mandal, West Godavari District and have been discharging their duties without any complaint. While so, the District Co-operative Officer vide proceedings dated 14.12.2015 ordered for enquiry under Section 51 of the A.P. Co-operative Societies Act into the affairs of the Society; in pursuance of the same, the Enquiry Officer has conducted an enquiry and submitted a report recommending to take action against the petitioners herein / accused. Basing on the said enquiry report, the Deputy Registrar of Co-operative Societies has issued notice dated 03.03.2018 directing the Managing Committee to submit an explanation as to why the Committee should not be superseded under Section 34(1) of the A.P. Cooperative Societies Act. Accordingly, the Committee has submitted its explanation, but, being not satisfied with the said explanation, the Deputy Registrar of Co-operative Societies has passed an order on 18.04.2018 by superseding the Society. The same was challenged by the Committee by filing W.P.No.17066 of 2018 and this Court passed the following order, on 02.05.2018 :

“It is contended by the leaned counsel for the petitioner that the impugned action is contrary to the provisions of sub-Section 6 of Section 34 of the A.P. Cooperative Societies Act. 1964 (for brevity, "the Act") and that, before resorting to the impugned action, under Section 34 (1) of the Act, the respondent authorities did not consult the financing bank.

In support of his contention, learned counsel for the petitioner placed reliance on a judgment of this Court in Appanna Suribabu and others V. Registrar of Cooperative Societies, Peddapuram and others 1999 (6) ALT 239."

In view of the above, there shall be interim suspension as prayed for.”

4. The grievance of the petitioners herein is that while the above said Writ Petition is pending, even without reaching the finality, relying on the enquiry report, the 2nd respondent herein has submitted a Complaint to the Station House Officer, Palakol Rural Police Station on 14.09.2018 alleging that the enquiry report reveals the misappropriation of funds in the Society. Basing on which, a case in F.I.R.No.140 of 2018 has been registered against the petitioners for the offences under Sections 468, 471, 477-A, 409, 420 r/w 34 IPC.

5. Heard learned counsel for the petitioners and learned Assistant Public Prosecutor appearing for the respondent No.1. Perused the material on record.

6. Mr. Turaga Sai Surya, learned counsel for the petitioners submits that no case can be registered on the basis of the enquiry report, since the enquiry report is not the conclusive proof and particularly when no action under Section 60 of the A.P.C.S. Act is initiated on the basis of the said enquiry, as such initiation of prosecution basing on the enquiry report is nothing but abuse of process of law. He further contended that no sanction has been obtained from the competitive authority i.e., the Registrar before initiating the criminal proceedings as required under Section 83(3) of the Act, therefore, prayed to quash the