IMPORTANT POINT
The auditor's report is deemed a decision under the MCS Act, allowing for revision, highlighting the importance of procedural fairness in addressing financial irregularities.

JUDGMENT :

(Sharmila U. Deshmukh, J.) :

1. Rule. Rule made returnable forthwith and heard finally with consent of the parties.

2. By this Petition, the challenge is to the order dated 27th January, 2023 passed by the Divisional Joint Registrar rejecting the Revision Application as not maintainable by holding that the auditor’s report under Section 81(1)(a) of The Maharashtra Co-operative Societies Act, 1960 (MCS Act) is not a decision or order and thus, revision under Section 154 of MCS Act is not maintainable.

3. The only issue arising for consideration is whether the Auditor’s report under Section 81 of MCS Act is revisable under Section 154 of MCS Act.

4. The facts required to be exposited is that vide order dated 31st March, 2022 passed under Section 102(2) of MCS Act, the District Deputy Registrar passed an interim order of liquidation and liquidator came to be appointed on Janta Nagari Sahakari Pathsanstha Ltd. (Panthsanstha). By order dated 6th May, 2022 the District Deputy Registrar appointed Respondent No. 2 auditor to conduct audit of the Patsanstha for the years 2019-2020 to 2021-2022 under Section 81(1) (a) of MCS Act as it was held that despite communications, the Pathsanstha had not conducted the audit. Pursuant thereto, audit was conducted and the audit report was submitted on 16th September, 2022 concluding that the managing committee members and other office bearers have accepted deposits beyond the permissible limits by luring depositors with higher rate of interest and have thereby cheated the depositors on large scale and are liable to face a criminal prosecution. Pursuant to the finding given by the auditor, FIR bearing Crime No. 302 of 2022 was registered against the Managing Committee Members under IPC and under Section 3 and 4 of the Maharashtra Protection of Interest of Depositors (In Financial Establishments Act, 1999).

5. The auditor’s report dated 16th September, 2022 came to be challenged by way of Revision Application under Section 154 of the MCS before Divisional Joint Registrar who dismissed the Revision Application for the reason that the Auditor’s Report is not a decision or order.

6. Heard Mr. Patil learned counsel for the Petitioner and Ms. Gavhane learned AGP for the State.

7. Mr. Patil, learned counsel for the Petitioner has taken this Court to the provisions of Section 81 of MCS Act and would submit that under sub section 6 of Section 81 of MCS Act, the Registrar has the power to direct re-audit of any accounts of Society and the provisions of Act applicable to the audit of the account shall apply to such re- audit. He submits that Section 82 of the MCS Act would be applicable and if any, defects are disclosed as result of the audit held under Section 81, the Society is to be given an opportunity of rectifying the defects and to remedy the irregularities. He submits that such an opportunity was not given to the Society of which the Petitioner was an office bearer and thus, the Revision Application came to be preferred under Section 154 of the MCS Act as there is no remedy of Appeal under Section 152 of the MCS Act. He submits that the audit report culminated into a decision that the depositors have been cheated and that the Petitioner is liable to face criminal prosecution and thus, satisfies the requirement of decision or order. He would further point out that under Section 154 of the MCS Act, the Registrar has the power to examine the record of any inquiry or proceeding wherein decision has been taken and in the present case, pursuant to the audit inquiry, decision has been taken by the auditor and therefore, the revision under Section 154 of the MCS Act was maintainable.

8. Per contra, learned AGP would submit that auditor has pursuant to the directions under Section 81(1)(a) of MCS Act conducted the audit and no order has been passed and thus, in the absence of any decision or order, the provisions of Section 154 of the MCS Act are not applicable.

9. Considered the submissions and perused the