Advocates Appeared:
For the Appellant : Venugopal M.S.
For the Respondents: S.B. Mukkannappa, Chandini S

The legal document pertains to a writ petition filed by Daivajna Credit Cooperative Society Ltd. challenging orders passed by the Joint Registrar of Cooperative Societies and the Karnataka Appellate Tribunal. The core issues involve the misconduct of respondent No.2, who served as Secretary and CEO of the Society, and the legality of disciplinary proceedings and orders of reinstatement.

Key Points:

1. The respondent, respondent No.2, admitted to availing gold loans in his own name exceeding the permissible limit and in the names of subordinate staff by pledging low-quality or spurious gold articles, which was confirmed through valuation reports (!) (!) (!) .

2. The Society conducted a departmental enquiry, during which respondent No.2 participated and did not dispute the findings or the manner of enquiry, merely requesting that his reply be considered as his response to the enquiry report (!) (!) .

3. The enquiry officer found multiple charges proved, leading to the Society dismissing respondent No.2 from service, a decision supported by the Board of Directors and the Society’s resolution (!) (!) .

4. Respondent No.2 challenged the disciplinary order under Section 70 of the relevant Cooperative Societies Act, and the dispute was initially decided in his favor by the Joint Registrar, who set aside the dismissal on technical grounds, and the Karnataka Appellate Tribunal confirmed this order, reinstating him with back wages and benefits (!) (!) (!) .

5. The petitioner Society contended that the orders of the Registrar and the Tribunal were based on incorrect facts, such as the false claim that approved valuers were not examined, and that the order was passed without proper consideration of the evidence and principles of natural justice (!) (!) .

6. The Court observed that respondent No.2, being a senior employee aware of the Rules, failed to raise objections at appropriate stages and participated in proceedings without contesting the enquiry findings, which indicated his acceptance of the misconduct (!) (!) .

7. The Court found the orders passed by the Joint Registrar and the Appellate Tribunal to be unsustainable, primarily because they overlooked the evidence of misconduct, the respondent’s admission, and procedural irregularities, and thus set aside these orders (!) (!) .

8. The Court upheld the Society’s order of dismissal, emphasizing respondent No.2's liability to repay the outstanding loan amount with interest, and directed that the Society is entitled to recover this amount from him (!) (!) .

9. The Court also noted that respondent No.2’s defense regarding the Board’s approval and the alleged lack of prejudice was not substantiated, and his participation in the proceedings without raising objections was deemed an acceptance of the process and findings (!) (!) .

10. In conclusion, the Court allowed the writ petition, set aside the orders of reinstatement, and upheld the dismissal order, affirming respondent No.2’s liability to settle the dues owed to the Society (!) (!) (!) .

This summary reflects the Court’s reasoning that procedural irregularities and respondent No.2’s conduct during the enquiry and dispute proceedings do not warrant overturning the Society’s disciplinary action, especially given the clear evidence of misconduct.