IMPORTANT POINT
The judgment emphasizes the importance of adhering to procedural requirements, respecting the scope of show cause notices, and considering previous findings in subsequent proceedings.

ORDER:

This Writ Petition, under Article 226 of the Constitution of India, is filed by the petitioner, seeking the following relief:

“….to issue direction or order or writ more so in the nature of Writ of Certiorari calling for the records on the file of Hon'ble Cooperative Tribunal in CTA 56 of 2008 dated 30.09.2010, is illegal, bad, erroneous and against to the probabilities of evidence and passed order without application of mind and without following guidelines and due procedure and needs to be quashed and the impugned order is violative of principles of Natural Justice apart from violative of Articles 14, 21 of Constitution of India and violative of provisions of the A.P Co operative Societies Act, 1964 and quash the same.…”

2. The brief facts that are necessary for disposal of the writ petition are as under:

i) The respondent No.2-Vijaya Cooperative Urban Bank (W) Limited, Road No.1, Banjara Hills, Hyderabad, was registered on 30.03.1997 with registration No.TA 1421 with initial membership of 2037 members and paid up share capital of Rs.20 lakhs. The bank was exclusively organized to cater the financial needs of the women. It started functioning with effect from 14.10.1997. During the course of inspection under Section 35 of the Banking Regulation Act, 1949, as to the working of the Bank, the Reserve Bank of India (Urban Banks Dept), Hyderabad, observed serious financial irregularities and also noticed serious lapses on the part of the Chartered Accountants (who conducted statutory audit of the Bank), in grading the Bank "A" by completely ignoring the weak status of the bank and requested to conduct an inquiry under Section 51 of the Andhra Pradesh Cooperative Societies Act, 1964 (for short “the Act”) with special emphasis on questionable transactions, alienation of securities, defects in statutory audit and violation of various provisions of the Act, as pointed out in their Inspection report vide R.B.I. Lr.No.UPD. (H), No.705/15.36.01/2002-03, dated 21-08-2002. In pursuance of the same, the Commissioner for Cooperation and Registrar of Cooperative Societies vide Memo No.5551/2001/CB-1, dated 29-08- 2002 advised the Joint Registrar(J.R)/District Cooperative Officer(DCO), to order statutory inquiry into the affairs of Bank. Thereupon the J.R/DCO, Hyderabad (Urban), vide his proceedings in RC.No.83/01-UB dated 07-09-2002 ordered an inquiry into the affairs of the bank. The District Cooperative Audit Officer, Hyderabad (Urban) was authorized to conduct inquiry under Section 51 of the Act. The Inquiry Officer conducted the inquiry and submitted his report stating that as against the total deposit of Rs.5,75,57,756-00, an amount of Rs.3,62,21,041-00 is payable to the Cooperative Urban Banks and Employees Cooperative Credit Societies and remaining amount of Rs.2,13,36,715/- is payable to the individual depositors besides interest and other liability; that an amount of Rs.1,14,31,136/- was deposited in the First City Cooperative Urban Bank, Jawahar Cooperative Bank, which was under liquidation and there is least possibility for realization of those amounts. On the basis of the findings in the inquiry report, the Divisional Cooperative Officer, Golconda Division, Hyderabad, issued show cause notice to the petitioner, Ex-Chairperson of the Bank and Ex-Board of Directors of the Bank on 23.03.2004. The petitioner herein, who is Ex-Chairperson of the Bank, Krishna Kumari and Smt.L.Mithili, who are Ex-directors of the Bank, have submitted their explanations but the other Ex-directors have not submitted their reply to the show cause notice. The respondent No.1 passed surcharge order dated 07.06.2004 against the petitioner for payment of Rs.5,83,06,592.00. Aggrieved by the said surcharge order, the petitioner filed an appeal vide CTA No.121 of 2004 on the file of A.P. Cooperative Tribunal, at Hyderabad, contending that no opportunity was given to her to adduce oral and documentary evidence and surcharge order passed is in gross violation