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2003 Supreme(Mad) 92
High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE P. SATHASIVAM
The Music Academy - Appellant
Versus
Inspector General of Registration & Others - Respondents
Writ Petition No. 15900 of 2002, W.P.M.P.No. 21284 of 2002 and W.V.M.P.No.1273 of 2002
Decided On : 24 January 2003
The main legal point established in the judgment is that the Registrar has the power to initiate an enquiry into the affairs of a society and issue directions for rectifying any irregularities, and that such actions are in accordance with the Act and the Rules.
Headnote:
Registrar of Societies - Tamil Nadu Societies Registration Act - Section 36, Section 46(2) - The court dismissed the writ petition filed by a music academy to quash the proceedings of the Inspector General of Registration and the report of the District Registrar, which alleged financial irregularities and non-compliance with the Act. The court held that the Registrar had the power to initiate an enquiry into the affairs of the society and issue directions for rectifying the irregularities. The court also found that the actions taken by the authorities were in accordance with the Act and the Rules.
Fact of the Case:
The Music Academy, a registered society, filed a writ petition to quash the proceedings of the Inspector General of Registration and the report of the District Registrar, alleging financial irregularities and non-compliance with the Act. The authorities had initiated an enquiry into the affairs of the academy and directed it to rectify the irregularities.
Finding of the Court:
The court found that the Registrar had the power to initiate an enquiry into the affairs of the society and issue directions for rectifying the irregularities. The court also held that the actions taken by the authorities were in accordance with the Act and the Rules.
Issues: The issues involved in the case included the validity of the proceedings initiated by the authorities, the alleged financial irregularities, and the non-compliance with the Act by the music academy.
Ratio Decidendi: The court held that the Registrar had the power to initiate an enquiry into the affairs of the society and issue directions for rectifying the irregularities. The court also found that the actions taken by the authorities were in accordance with the Act and the Rules.
Final Decision: The court dismissed the writ petition and held that the actions taken by the authorities were in accordance with the Act and the Rules.
By consent of all the parties main writ petition itself is taken up for disposal. Aggrieved by the proceedings of the Inspector General of Registration, Chennai-28/first respondent herein, dated 19-3-2002 and the report of the District Registrar of Audit and Enquiry Officer, Chennai-1, dated 29-1-2002, the Music Academy, Chennai-14, through its Executive Trustee has filed the above writ petition to quash the same, and consequently forbear the respondents from proceeding any further with any civil or criminal proceedings.
2. The case of the petitioner-Music Academy is briefly stated hereunder:
The petitioner is a well known premier organization for promotion of fine arts, music and culture. The petitioner society was founded way back in the year 1929 and the same was registered as a society under the Societies Registration Act, 1860. The petitioner has also been recognized as a public charitable institution for the purpose of Section 80(G) of the Income Tax Act and sections 11, 12, 13 of the Indian Companies Act, 1961. It transpires that one S.M. Sundaram and few other members appear to have made a complaint to the respondents about the functioning of the petitioner questioning the validity of certain bye-laws including the legality of the Executive Committee, the Governing body of the Music Academy. There were certain other allegations pointing out certain financial irregularities. The validity of certain bye-laws were unsuccessfully challenged by one member by name P. Venugopal, who has instituted C.S.No. 487 of 2001 seeking for various reliefs and which is pending on the file of this Court. As regards the affairs of the society, certain complaints were made to the effect that the returns of the society were not filed for 10 years and that resolutions and amendment to the bye-laws have not been legally carried out and there is an attempt to seek exemption with regard to filing of returns from the provisions of the Tamil Nadu Societies Registration Act. There were also some accusation of financial irregularities in the matter of provision of false ceiling to the auditorium and other matters. Based on the objections received from time to time and in an unprecedented manner, the respondents have proceeded to unilaterally come to the conclusion that the affairs of the petitioner are indeed not being carried on in consonance with the provisions of the Tamil Nadu Societies Registration Act and there are certain financial irregularities, even without conducting any enquiry, deeply affecting not only the petitioner institution, but also the respectable members holding responsible office in the petitioner academy.
3. It is further stated that the second respondent based on the proceedings of the first respondent dated 7-11-2001, sent a report dated 29-01-2002 to the latter. It appears from the enquiry report dated 29-1-2002 that the said proceedings were in the nature of directions by the first respondent to the second respondent to conduct an enquiry under Section 36 of the Tamil Nadu Societies Registration Act, which empowers the Registrar to enquiry into the affairs of the registered society on his own motion or on the application of the majority of the members of the committee of the registered society or on the application of not less than 1/3rd of the members of the registered society. Only 19 members of the academy, out of a total number of 1524 members which do not constitute the required number of members on whose application the respondents can act. The very initiation of enquiry was therefore void ab-initio. Based on the ex parte enquiry conducted by the 2nd respondent, several precipitative actions have been taken including filing of a criminal complaint for petty offence for non filing of returns, against the President of the Academy in C.C.No. 2734 of 2002 on the file of the XI Metropolitan Magistrar, Saidapet, for a petty offence under Section 46 (2) of the Tamil Nadu Societies Registration Act. The enquiry ha
