Delhi High Court
Jain Co-Operative Bank Ltd vs Registrar Cooperative Societies ... on 15 July, 2022
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* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Reserved on: 06th July, 2022
Pronounced on: 15th July, 2022
+ W.P.(C) 9897/2022 and C.M. APPL. 29126/2022, C.M.
APPL. 29127/2022, C.M. APPL. 29128/2022 and C.M.
APPL. 29129/2022
JAIN CO-OPERATIVE BANK LTD. ..... Petitioner
Through: Mr. Abhinav Sharma and
Mr. Himanshu Kaushal,
Advocates
versus
REGISTRAR COOPERATIVE SOCIETIES
& ANR. ..... Respondents
Through: Mr. Rajeev Aggarwal,
Additional Standing Counsel
for R-1/RCS.
CORAM:
HON'BLE MR. JUSTICE SIDDHARTH MRIDUL
HON'BLE MR. JUSTICE AMIT SHARMA
JUDGEMENT
AMIT SHARMA J.
1. The present writ petition under Articles 226 read with 227 of
the Constitution of India has been filed by Jain Co-operative Bank
Ltd. (hereinafter referred to as petitioner), seeking setting aside of
order dated 22.02.2021 in Appeal No. 162/2018 and order dated
18.05.2022 in Review Petition No. 11/2021 passed by the Delhi
Cooperative Tribunal under the Delhi Cooperative Societies Act,
W.P.(C) 9897/2022
2003.
2. Facts necessary for the disposal of the present petition are as
follows:
(a) The petitioner is a Cooperative Bank registered under
the provisions of Delhi Cooperative Societies Act, 2003.
Respondent no. 2 was a member of the petitioner and was one of
the Directors in 2016. Subsequently, an FIR No. 420/2016, P.S.
Darya Ganj was registered wherein the respondent no.2's
involvement was being investigated. The said registration of the
FIR and alleged involvement of the respondent no.2 gave rise to
proceedings initiated by the petitioner, resulting in submitting a
proposal for expulsion of respondent no.2 from membership of the
petitioner. The petitioner submitted a proposal to Registrar
Cooperative Societies for cancellation of membership of
respondent no.2 under Section 40 (iii) of the Delhi Cooperative
Societies Act, 2003. Consequent upon which, a show cause notice
dated 02.02.2018 was issued to respondent no.2 by the Registrar
Cooperative Societies.
(b) The Registrar Cooperative Societies, after receiving the
reply by the respondent no.2, and after hearing the arguments of
both the parties passed an order dated 05.06.2018, whereby the
proposal of the petitioner to expel the respondent no.2 from the
membership was approved.
(c) The respondent no.2 being aggrieved by the aforesaid
order dated 05.06.2018 filed an appeal under Section 112 of the
W.P.(C) 9897/2022
Delhi Cooperative Societies Act, 2003 before the Delhi
Cooperative Tribunal.
(d) The Delhi Cooperative Tribunal vide order dated
22.02.2021 set aside the order of 05.06.2018 passed by Registrar
Cooperative Societies and allowed the appeal filed by respondent
no.2 with the following observations:
"25. The allegations which weighted with RCS in passing
the order are mentioned in the impugned order under the
heading brief facts of the case. What is mentioned here as
facts, is only that an FIR has been lodged regarding 09
accounts with fake introductory references and that the
Investigating Officer of Delhi Police had given directions
to the bank management not to allow to appellant to enter
the bank till the finalization of the investigation as he was
a master mind of the case. In the impugned order, the ld.
Registrar has stated that the appellant had submitted his
reply and was represented through his Counsel, but has
not discussed any of the contents of the reply or any
contentions put forth on behalf of appellant. He has just
mentioned that
"I am of the considered view that the bank
suffered disrepute from the acts of Sh.
Shashank Jain and also his actions/behavior is
detrimental to the interest, reputation and
proper working of the bank. Therefore, I hereby
approve the proposal of the bank for ceasing
the membership of Shashank Jain bearing
No.26629".
26. Now, it is an admitted position that although the FIR
No.0420 has been registered with regard to opening of
nine fake accounts, the same is against unknown persons
and the appellant is not named there. Then, as per the
documents filed along with the written arguments, the
W.P.(C) 9897/2022
charge sheet in the case had already been filed on
7.12.17 i.e. six months before passing of the impugned
order. As per the charge sheet, five accused persons were
charge sheeted to the court and the column meant to
name any persons who were suspected but not charge
sheeted, is marked as 'NIL'. Although the charge sheet
mentions the allegations of suspicion against the
appellant based on some confessional statements of the
charge sheeted accused persons, the fact of the matter is
that even after completion of investigation, the appellant
has not been charge sheeted.
27. The position therefore is that although an offence has
been committed which had a potential to bring the bank
in disrepute, there is no link to connect the appellant with
the same.
28. In the absence of any other reasons given by the Id.
RCS in the impugned order, we are not able to
understand as to how a mere observation by an I.O. made
during investigation could be taken as bringing disrepute
to the bank even when the I.O. himself has not as yet
chosen to charge sheet the appellant in the said case or
even to name him in the list of "suspected but not charge
sheeted" persons."
(e) Aggrieved by the aforesaid order passed by the learned
Registrar Cooperative Tribunal in Appeal No. 162/2018, the
petitioner filed a Review Petition No. 11/2021/DCT under Section
115 of the Delhi Cooperative Societies Act, 2003. The review of
the order passed in the aforesaid appeal was sought primarily on
the ground that in a response to RTI query by the petitioner, it was
stated by the Economic Offences Wing of the Delhi Police that
"the supplementary investigation is under progress and a
W.P.(C) 9897/2022
supplementary charge-sheet shall be filed after its completion". In
response to another query specifically with regard to Sh. Shashank
Jain, it is mentioned in the reply that "the supplementary
investigation of the cased in respect of Sh. Shashank Jain is under
progress at different aspect." (sic). The said review petition was
dismissed by the Delhi Cooperative Tribunal vide order dated
18.05.2022 with the following observations:
"9. After hearing both sides, we tend to agree with the Id.
counsel for respondent. Firstly, the response to the RTI
query as imposed by the review petitioner, states that Sh.
Shashank Jain is being investigated on 'another aspect'.
This indicates that his involvement in the case of opening
fake accounts could not be verified. Even otherwise,
despite the role of Sh. Shashank Jain being under
suspension right since 2016, enough evidence has still not
been found by the LO. to charge-sheet him. There may be
a possibility that he may at the time of filing of
supplementary charge-sheet be arrayed as an accused.
However, there is also at least an equally strong
possibility that he may not be: It cannot therefore be
speculated that he shall be found responsible for the
alleged act which could bring disrepute to the bank or
otherwise detrimental to the working of the bank."
(f) Aggrieved, the petitioner has filed the present writ
petition seeking setting aside of the aforesaid orders.
3. The learned counsel appearing on behalf of the
petitioner has submitted that the orders passed by the Delhi
Cooperative Tribunal in the appeal as well as the review petition
have ignored the fact that the investigation in the said FIR is still
continuing and that the aforesaid orders passed by the learned
W.P.(C) 9897/2022
Tribunal have prejudiced the entire investigation. It is further
submitted by the learned counsel appearing on behalf of the
petitioner that the respondent no.2 had been absconding and
evading the investigation in the aforesaid FIR. The anticipatory
bail filed by respondent no.2 had been dismissed and the said order
was carried up to the Hon'ble Supreme Court without any relief. It
was further submitted, that registration of FIR and the continuation
of investigation of alleged involvement of respondent no.2, would
be adequate grounds for bringing "disrepute to the petitioner" and
therefore expulsion of respondent no.2 by Registration of
Cooperative Societies was proper and should not have been
interfered with.
4. It is an admitted position that the FIR was registered on
26.12.2016, wherein the respondent no.2 was not named, and the
charge-sheet in the said FIR was filed on 07.12.2017, wherein the
respondent no.2 has not been arrayed as an accused.
5. The order of expulsion passed, by Registrar Cooperative
Societies vide order dated 05.06.2018, was primarily on the ground
that the respondent no.2 was being investigated in the said FIR
which brought disrepute to the petitioner. It may be further noted
that the order, passed by Registrar Cooperative Societies, has not
given any other reason except for the alleged involvement of
respondent no.2 in the said FIR.
6. The learned Delhi Cooperative Tribunal, in the appeal
filed by respondent no.2, has categorically stated that the reasoning
given by the learned Registrar Cooperative Societies in the
W.P.(C) 9897/2022
expulsion order dated 05.06.2018 was not sustainable and that the
said order of the learned Registrar Cooperative Societies, is cryptic
in nature.
7. After going through the impugned orders dated 22.02.2021 and
18.05.2022 passed by the learned Delhi Cooperative Tribunal, we are
satisfied that the same do not suffer from any infirmity. The
petitioner has not been able to point out any illegality or any manifest
error requiring us to exercise our discretion under Articles 226 read
with 227 of the Constitution of India and interfere with the impugned
orders as mentioned hereinabove.
8. It is well settled that the jurisdiction under Articles 226 read
with 227 of the Constitution of India is to be exercised in cases where
it can be established that the orders challenged have been passed in
grave dereliction of duty or in flagrant abuse of fundamental
principles of law and justice. The Hon'ble Supreme Court in Jai
Singh and Ors Vs. Municipal Corporation of Delhi and Anr.
reported in (2010) 9 SCC 385 as in para 16 has observed as under:
"16. The High Court cannot lightly or liberally act as an
appellate court and reappreciate the evidence. Generally,
it cannot substitute its own conclusions for the
conclusions reached by the courts below or the
statutory/quasi-judicial tribunals. The power to
reappreciate evidence would only be justified in rare and
exceptional situations where grave injustice would be
done unless the High Court interferes. The exercise of
such discretionary power would depend on the peculiar
facts of each case, with the sole objective of ensuring that
there is no miscarriage of justice."
W.P.(C) 9897/2022
9. For the reasons stated hereinbefore, we dismiss the present writ
petition.
10. Accordingly, the writ petition along with pending applications
is dismissed.
AMIT SHARMA
JUDGE
SIDDHARTH MRIDUL
JUDGE
JULY 15, 2022
ab
W.P.(C) 9897/2022
