The Registrar's failure to consult the Circle Co-operative Union before superseding a Managing Committee violates Section 32(2) of the Kerala Co-operative Societies Act, rendering such actions invalid.

JUDGMENT :

K. BABU, J.

1. The petitioner is the former President of the Ernakulam West Rural Fishermen Development and Welfare Co-operative Society Ltd., a primary co-operative society. Pursuant to a democratic process, the Managing Committee of the society assumed charge on 30.10.2020.

2. The Registrar of Co-operative Societies, Fisheries Department (Ernakulam) (respondent No.1) issued an order under Section 66 of the Kerala Co- operative Societies Act (for short “the Act”) directing an inspection into the functioning of the Society. The office bearers of the Society cooperated with the inspection and participated in the inquiry.

3. The Registrar (respondent No.1), as per the order dated 13.01.2025, superseded the Board of Directors and appointed a part-time Administrator for the Society on the ground that the Managing Committee had indulged in illegal actions. The order of supersession of the Managing Committee under Section 32 (1) of the Act, (Ext.P15) is under challenge in this proceeding.

4. I have heard the learned counsel for the petitioner and the learned Senior Government Pleader.

5. The learned counsel for the petitioner confined the challenge on Ext.P15 on the ground that it is in violation of sub-section (2) of Section 32 of the Act.

6. The learned counsel for the petitioner submitted that before issuing an order superseding the Managing Committee of a society, the Registrar shall consult the Financing Bank and the Circle Co-operative Union or the State Co-operative Union, as the case may be.

7. The learned Senior Government Pleader submitted that consultation as provided under sub-section (2) of Section 32 of the Act does not arise in the present case, as respondent No.4 society has not been affiliated to the Circle Co-operative Union and, further, that there is no financing bank in respect of Fishermen Development and Welfare Co-operative Society. It is submitted that the District Co-operative Bank/State Co-operative Bank can only be considered as Financing Bank within the meaning of sub-section (2) of Section 32 of the Act.

8. The learned counsel for the petitioner submitted that the apex society in the case of respondent No.4 primary society, is Matsyafed (Kerala State Co- operative Federation for Fisheries Development Limited No.F(T) 738).

9. It is relevant to extract Section 32 of the Act. 32. Supersession of Committee(1) If the Registrar, after an inquiry by himself or through his subordinates or on a report of the financing bank, or the Vigilance, and Anticorruption Bureau of the Government or the Vigilance Officer or otherwise, is satisfied that the committee of any society,-

(a) persistently makes default or is negligent in the performance of the duties imposed on it by this Act or the rules or bye-laws or does anything which is prejudicial to the interests of the society; or

(b) wilfully disobeys or fails to comply with any lawful order or direction issued under this Act or the rules; or

(c) makes any payment contrary to this Act or the rules or the bye-laws or causes any loss or damage to the assets of the society, by breach of trust or wilful negligence; or

(d) misappropriates or destroys or tampers with the records or causes the destruction of records to cover up any misconduct or malpractice,

He may, after giving the committee an opportunity to state its objections, if any, by order in writing, remove