Advocates Appeared:
For the Petitioners:Mr. Avinash H. Fatangare a/w Ms. Archana S. Shelar i/by Ms. Vishakha Pandit, Mr. Ajit Karwande i/by Mr. Sampatrao Pawar, Mr. Rajeshwar G. Panchal a/w Mr. A.R. Kori, Mr. Anil Anturkar, Senior Advocate a/w Mr. Harshvardhan Suryawanshi i/by Bharati Aindey, Mr. Atul Damle, Senior Advocate a/w Mr. Prashant Kulkarni, Mr. Shailendra Kanetkar a/w Ms. Shravari Kanetkar and Yash Dewal, Mr. Akash Rebello a/w Mr. Rajiv Deokar a/w. i/by Akshay Dalvi, Mr. Sachin Pawar, Mr. Abhijeet Desai a/w Mr. Karan Gajra i/by Desai Legal.
For the Respondents: Mr. Sachin H. Kankal, AGP, Dr. Uday Warunjikar a/w. Mr. Omkar Mane a/w Ms. Hema Kenjale, Ms. Rebecca Almeida a/w. D.S. Hale, Mr. S.B. Gore, AGP a/w. Mr. Kedar B. Dighe, AGP, Ms. Rakhi Gavade, Liquidator of the Bank, Mr. Nazmi Virani, Recovery Officer present.

Based on the provided legal document, the key points are as follows:

1. The court has disposed of a group of 19 Writ Petitions challenging the inquiry report dated 25.09.2018 under Section 88 of the Maharashtra Co-operative Societies Act, 1960, and the subsequent appellate order dated 20.09.2019, which upheld the inquiry findings (!) (!) .

2. The inquiry held 27 persons liable for causing financial loss to the bank through alleged fraudulent disbursements of rickshaw and housing loans, with liabilities ranging from approximately Rs. 50 Lacs to Rs. 2.21 Crores per individual (!) (!) .

3. The Petitioners, including employees, Directors, and employee-Directors, challenged these findings, asserting that the inquiry was conducted without following proper statutory procedures, including the principles of natural justice and due process of law (!) (!) (!) .

4. The Petitioners argued that their roles were limited to routine disbursement activities, and they lacked authority or decision-making power regarding sanctioning or recommending loans, which were primarily handled by loan agents, the Board, or designated committees (!) (!) (!) .

5. The Petitioners contended that the inquiry report relied heavily on the loan policy and standard procedures, and that the actual role of the loan agents—who were responsible for the submission of fake RC books—was not adequately considered or proven to be attributable to them or the Petitioners (!) (!) (!) (!) .

6. The court observed that the inquiry was conducted in a mechanical manner, with the inquiry report merely reiterating the loan policy verbatim and assigning liability through a proportional division of the total alleged loss, without establishing specific acts of fraud or misfeasance by the Petitioners (!) (!) (!) .

7. The court found that the inquiry did not follow the due process, including the procedural requirements of providing adequate opportunity to the Petitioners, calling for and examining all relevant evidence, and establishing a clear nexus between the Petitioners' roles and the alleged financial misconduct (!) (!) (!) (!) .

8. The findings indicated that the liability of the Petitioners for the alleged financial fraud could not be sustained because the inquiry failed to identify any specific wrongful act attributable to them, especially considering that the primary fault lay with loan agents who submitted fake documents, and the Petitioners' involvement was limited to routine disbursement activities without active participation in the fraud (!) (!) .

9. The court emphasized that the legal provisions under Section 88 require a proper, evidence-based, and reasoned inquiry, which was not followed in this case, rendering the impugned orders and inquiry reports liable to be quashed (!) (!) (!) (!) .

10. Consequently, all the Writ Petitions were allowed, and the inquiry reports and appellate orders were set aside, with directions that the proceedings based on these orders are nullified for not adhering to statutory due process (!) (!) (!) .

11. The court also acknowledged the importance of following proper procedures, including the recording of reasons and providing fair opportunities to the Petitioners, and noted that the inquiry lacked these fundamental procedural safeguards (!) (!) (!) (!) .

12. Overall, the judgment underscores that liability under the relevant statutory provisions cannot be established on a mechanical or superficial basis, but must be supported by concrete evidence demonstrating specific wrongful acts attributable to the Petitioners, which was absent in this case (!) (!) (!) .

These points collectively reflect that the court found the inquiry process flawed, the liability unsubstantiated, and the orders passed without proper adherence to legal standards, leading to the quashing of the impugned orders and orders in the petitions.