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IN THE HIGH COURT OF KERALA AT ERNAKULAM
C.T.RAVIKUMAR, K.HARIPAL, JJ.
E.S.Bose, S/o. Skaria – Appellant
Versus
The Managing Committee (Under Order Of Suspension) – Respondent
WA No. 1021, 1031, 1060 of 2020
Decided on : 31-05-2021
Kerala Co-operative Societies Act, 1969 – Sections 28, 65, 32 – Abuse of process – Suspension – Writ petitioner viz., the appellant in W.A. filed the above mentioned writ petition seeking the reliefs Issue a writ of certiorari calling for the records leading to Exhibit P7 and to quash the same. – Issue a writ declaring that Exhibit-P7 is the end result of colourable exercise of power and therefore bad in law; – Issue an order declaring that the Exhibit P7 passed without notice, consultation with the financial bank and hearing is illegal and therefore bad in law. – Issue a writ declaring that Exhibit-P7 is an abuse of process so as to over reach the contents of Exhibit-P6 judgment of this Honourable Court and thus the action of the 1st respondent would amount to colourable exercise of power.
Finding of the court: Court have also no hesitation to hold that the same also cannot be ordered to be treated as a notice as to why suspension should not be ordered for the simple fact that as per Ext.P7 assigning the reasons already mentioned in a vague manner and that continuation of the existing committee would hamper the smooth conduct of inquiry under Section 65 of the KCS Act the committee was placed under suspension thereunder for a period of six months and in substitution of the committee the Assistant Registrar (General), Idukki was appointed as the Administrator of the society. – If in a vague manner the reason for suspension is stated in an order for suspending a democratically elected committee of a society pending an inquiry under Section 65 of the KCS Act and when the materials on record would undoubtedly suggest that the subject of the inquiry is mostly and mainly in respect of dealings and transactions occurred during the period of the previous committee one cannot say that it is an exceptional circumstance to exercise the power of suspension. – If the said power, in the absence of specific guidelines or procedures, is allowed to be exercised in the like manner it will not only result in arbitrary exercise of power but also a perennial threat for democracy as Co-operative Societies are considered to be democratic institutions at the grass root level. – Court find no reason to restrain the petitioner, a democratically elected committee of a society from taking policy decisions and also to confine themselves to carrying out of day-to-day activities in the circumstances obtained in this case. – While confirming quashment of Ext.P7 and the direction to put back the petitioner committee in power court vacate the other limbs of direction No.(C) restraining the committee that during the period of inquiry they shall not take any policy decisions affecting the society but shall confine themselves to carrying out the day-to-day activities. – Court make it clear that we shall not be understood to have made any opinion or observation with respect to the ongoing inquiry under Section 65 of the KCS Act and the references about the same are made only for the purpose of the disposal of the appeals. – Direction that the petitioner should fully co-operate with the inquiry and facilitate completion of the inquiry is not interfered with. – Court may also hasten to add that this observation will not take away or prejudice the right of the petitioner to take up all legal and factual contentions in case any step is taken based on the report of inquiry under Section 65 of the KCS Act.
Result: Appeal Dismissed
JUDGMENT :
Ravikumar, J.
All the captioned appeals arise from the judgment dated 4.8.2020 in W.P.(C)No.13602 of 2020. The first among them was filed by Member No.8532 of Vellathooval Service Co-op. Bank Ltd.No.K.71 (for short 'the Bank') who got impleaded in the writ petition as additional 3rd respondent. The second one among them was filed by the petitioner in the said writ petition viz., The Managing Committee of the Bank which was placed under suspension for a period of six months from 3.7.2020, the date of the impugned Ext.P7 order bearing No.CRP.7051/19. The last among the appeals was filed by the first respondent in the writ petition viz., the Joint Registrar of Co-operative Societies (General), Painavu, Idukki District. The writ petitioner viz., the appellant in W.A.No.1031 of 2020 filed the above mentioned writ petition seeking the following reliefs:-
ii. Issue a writ declaring that Exhibit-P7 is the end result of colourable exercise of power and therefore bad in law;
iii. Issue an order declaring that the Exhibit P7 passed without notice, consultation with the financial bank and hearing is illegal and therefore bad in law.
iv. Issue a writ declaring that Exhibit-P7 is an abuse of process so as to over reach the contents of Exhibit-P6 judgment of this Honourable Court and thus the action of the 1st respondent would amount to colourable exercise of power.”
2. Before adverting to the impugned judgment of the learned Single Judge it is only appropriate to refer to the factual scenario that constrained the appellant in W.A.No.1031 of 2020 to file W.P.(C)No.13602 of 2020, succinctly. The appellant in W.A.No.1031 of 2020 viz., the writ petitioner is the Managing Committee of the Bank which was suspended under the order impugned in the writ petition viz., Ext.P7 dated 3.7.2020. The Board of Directors of the Bank was elected to office on 30.12.2018 and they assumed charge on 1.1.2019. In terms of Section 28 of the Kerala Co-operative Societies Act, 1969 (for short 'KCS Act'), under normal circumstances, the term of the said committee would expire only on 31.12.2024. Based on various complaints an inquiry was conducted under Section 65 of the KCS Act against the previous committee of the Bank. However, before any action for supersession of the said committee was initiated its term got expired and subsequently, the present committee under suspension assumed charge. Thereupon, one P.K.Ibrahimkutty and 35 others filed a complaint dated 11.11.2019 and consequently, the first respondent in the writ petition, the Joint Registrar of Co-operative Societies (General), Painavu, Idukki (Appellant in W.A.No.1060 of 2020) directed the Assistant Registrar (General), Devikulam to conduct a preliminary inquiry and to submit a report. Consequently, the Assistant Registrar submitted a preliminary report before the Joint Registrar. Upon its receipt, holding the view that continuance of the present Managing Committee that assumed office on 1.1.2019 would hamper the smooth conduct of the inquiry under Section 65 of the KCS Act and therefore, it is expedient to suspend the said committee to augment smooth conduct of the inquiry after dispensing with issuance of notice under Section 32(1) of the KCS Act, the present Managing Committee was suspended for a period of six months from 3.7.2020 as per the impugned Ext.P7 order dated 3.7.2020. In and vide the said order simultaneous with the suspension of the Managing Committee the Assistant Registrar (General), Idukki was appointed as Administrator of the Bank. It is in the aforesaid circumstances that raising various factual and legal contentions W.P.(C)No.13602 of 2020 was filed.
3. After considering the rival contentions the learned Single Judge as per the impugned judgment set aside Ext.P7 order suspending the Committee of the Bank and issued the following further directions:-
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