T. Satyanarayana vs Joint Registrar/District Cooperative Officer and Others

L. Narasimha Reddy, J.—The petitioner is the President of Gundugolanukunta Primary Agricultural Cooperative Credit Society Limited (for short ''the Society'' ). He challenges the order dated 16-07-2007, through which, the Joint Registrar-cum-District Co-operative Officer, West-Godavari, at Eluru, the 1st respondent, initiated enquiry u/s 51 of the A.P. Co-operative Societies Act, 1964 (for short ''the Act'' ). On an earlier occasion, based on the representation submitted by the Vice-President of the Society, the 4th respondent, and certain others, the 1st respondent caused inspection u/s 52 of the Act. Simultaneously, the 1st respondent proposed to take action against the petitioner, u/s 21AA of the Act, leading to the disqualification. An order dated 05-10-2006 was passed, declaring that the petitioner ceased to be the President of the Managing Committee.

O.A. No. 73 of 2006, filed by the petitioner, before the A.P. Co-operative Tribunal, Vijayawada, was dismissed. Thereupon, the petitioner filed W.P. No. 1823 of 2007, challenging the order of the Tribunal, as well as the order confirmed therein. The writ petition was allowed on 16-03-2007, holding that there was no basis for the 1st respondent, to pass the order dated 05-10-2006. It was pointed out that, it is only the report in an enquiry u/s 51, that can constitute the basis, for the action u/s 21AA, and not after the report, submitted u/s 52 of the Act.

Respondent No. 4, and six others of the Society, submitted representation dated 20-06-2007 to the 1st respondent, with a request to cause enquiry u/s 51 of the Act, vis-a-vis the petitioner. Acting on the same, the 1st respondent issued the impugned proceedings, appointing the Divisional Co-operative Officer, Kowur, to examine the records and fix the responsibility against the concerned.

The petitioner contends that an enquiry u/s 51 of the Act can be ordered by the 1st respondent, either suo motu, or on an application made by not less than 1/3rd of the members of the Committee, or not less than 1/5th of the total number of members, and that none of the above Circumstances exist, in this case. It is urged that the 4th respondent failed in his attempts, to get the petitioner disqualified, on the basis of the proceedings under Sections 52 and 22-AA of the Act, and that this is a fresh attempt.

Separate counter-affidavits are filed by respondents 1 to 3, and respondent No. 4. According to them, the impugned proceedings completely accord with Section 51 of the Act, and the petitioner is making attempt only to cover up his lapses.

Heard Sri A. Ramalingeswara Rao, learned Counsel for the petitioner, learned Government Pleader for Co-operation, and Sri M.V. Durga Prasad, learned Counsel for the 4th respondent.

It has already been pointed out that the earlier round of litigation, commenced with the issuance of notice, u/s 21-AA, and leading to the disqualification of the petitioner; and ended with the setting aside of the order, passed by the 1st respondent. This Court observed that, it is only a report, submitted in an enquiry, conducted u/s 51, that can constitute the basis for the proceedings u/s 21-AA and not the report of inspection, u/s 52 of the Act.

The Act provides for audit, enquiry and inspection under Sections 50, 51 and 52, respectively. The common factor, as regards these three exercises is, that, the findings recorded therein can lead to surcharge proceedings, u/s 60 of the Act. Apart from that, the findings in an enquiry u/s 51, would constitute the basis, for action u/s 21-AA. The manner in which the proceedings, under these provisions; can be initiated, differs from each other. Audit u/s 50 is, almost a periodical exercise. Enquiry u/s 51 can be ordered by the Registrar, on his own motion, or on an application filed by not less than 1/3rd of the members of the Managing Committee, or not less than 1/5th of the total members of the Society. Inspection u/s 52, on the other hand, can be ordered by the Registrar, on his own motion, or on an application by a creditor Society.

In the instant case, the basis for the impugned proceedings dated 16-07-2007, directing enquiry u/s 51, is a representation dated 20-06-2007, filed by the 4th respondent, the Vice-President and six others, of the Society. Therefore, it cannot be treated as an enquiry, ordered by the 1st respondent, on his own accord. Once that be so, there must have been representation of, at least, 1/3rd members of the Managing Committee, or 1/5th of the total members of the Society. The representation dated 20-06-2007, submitted by the 4th respondent and certain others; does not satisfy this requirement. Therefore, the very basis for initiating the proceedings u/s 51 of the Act, by the 1st respondent, becomes defective.

Once an Authority institutes proceedings under a provision, on the strength of a representation, he cannot sustain it, as the one, on his own accord, if the requirement under the provision is not satisfied. It is not open to the 1st respondent to treat the impugned order as the one, on his own accord, when, in clear terms, it is mentioned that he instituted the proceedings on the representation made by the 4th respondent, and certain others.

On this short ground, the writ petition is allowed, and the impugned proceedings are set aside. This order, however, does not preclude the 1st respondent to take any steps, in accordance with the provisions of the Act, and the Rules made thereunder.

There shall be no order as to costs.