The issuance of a show cause notice under the Telangana Co-operative Societies Act, 1964, does not automatically cause the cessation of membership of the Managing Committee; such cessation only occurs after a formal finding is recorded in the proceedings.

Judgment:

Heard learned counsel Sri Aadesh Varma appearing for the appellants, who are respondents No.4 and 5 in W.P.No.11023 of 2026; learned counsel Sri M.Damodar Reddy appearing for respondent No.1, who is the writ petitioner; Ms. B.Mohana Reddy, learned Government Pleader for Cooperation Department, appearing for respondents No.2 to 4.

2. The learned writ court by the impugned judgment, dated 08.06.2026 passed in W.P.No.11023 of 2026, directed respondent No.4 herein to complete the proceedings initiated against the appellants, who are the Directors of respondent 5 – bank and against whom a show cause notice dated 11.03.2026 has been issued after a statutory inspection under Section 52 of the Telangana Co-operative Societies Act, 1964 (hereinafter referred to as, “the Act of 1964”) as to why action under Section 60 of the said Act should not be initiated against them. By the said show cause notice, the appellants were asked to furnish reply within 15 days with documentary evidence, failing which action against them as per the records of the society and the provisions of the Act of 1964 would be taken. The writ petitioner approached the learned writ court with the following prayer:

“For the reasons stated in the accompanying affidavit the petitioner pray the Hon’ble Court may be pleased to issue an order or direction more particularly one in the nature of Writ of Mandamus declaring the action of the 4th respondent Bank in including the names of the 5th and 6th respondents as Directors of the 4th respondent Bank to attend the meeting of the Managing Committee of the Bank scheduled to be held in the month of April, 2026 though the respondents 5 and 6 are ceased to be Directors of the Bank upon initiation of the proceedings U/Sec.52 and Section 60 of the Act, 1964 upon their indulging in the malpractice causing loss to the tune of Rs.65,47,766/- as illegal, unlawful, contrary to law and consequently direct the 4th respondent Bank to delete the names of the 5th and 6th respondents from the above schedule and also direct the 2nd and 3rd respondents to consider the representation of the petitioner dated 01.04.2026 and declare the 5th and 6th respondents are ceased Directors of the Bank and they shall have no right to participate in the affairs of the 4th respondent bank, and pass such other order or orders which are necessary in the interest of justice.”

3. When the matter was taken up on 10.04.2026, the learned writ court passed the following interim order in the absence of respondent No.5:

“This Writ Petition is filed with the following prayer:

“… to issue an order or direction more particularly one in the nature of Writ of Mandamus declaring the action of the 4th respondent Bank in including the names of the 5th and 6th respondents as Directors of the 4th respondent Bank to attend the meeting of the Managing Committee of the Bank scheduled to be held in the month of April, 2026 though the respondents 5 and 6 are ceased to be Directors of the Bank upon initiation of the proceedings U/Sec. 52 and Section 60 of the Act, 1964 upon their indulging in the malpractice causing loss to the tune of Rs 65,47,766/-, as illegal, unlawful, contrary to law and consequently direct the 4th respondent Bank to delete the names of the 5th and 6th respondents from the above schedule and also direct the 2nd and 3rd respondents to consider the representation of the petitioner dated 01-04-2026 and declare the 5th and 6th respondents are ceased Directors of the Bank and they shall have