Joint Registrar Of Cooperative ... vs Y.R.Vincent
2025 Latest Caselaw 4697 Ker

Kerala High Court

Joint Registrar Of Cooperative ... vs Y.R.Vincent on 4 March, 2025

Author: Amit Rawal

Bench: Amit Rawal

                                                         2025:KER:20170

               IN THE HIGH COURT OF KERALA AT ERNAKULAM

                                PRESENT

                 THE HONOURABLE MR. JUSTICE AMIT RAWAL

                                   &

               THE HONOURABLE MR.JUSTICE K. V. JAYAKUMAR

     TUESDAY, THE 4TH DAY OF MARCH 2025 / 13TH PHALGUNA, 1946

                          WA NO. 1620 OF 2024

        AGAINST THE JUDGMENT DATED 19.12.2023 IN WP(C) NO.14402 OF

                     2022 OF HIGH COURT OF KERALA

APPELLANT/S:

    1      JOINT REGISTRAR OF COOPERATIVE SOCIETIES
           OFFICE OF THE JOINT REGISTRAR OF COOPERATIVE
           SOCIETIES,JAGATHI,THIRUVANANTHAPURAM, PIN - 695014

    2      GOVERNMENT OF KERALA REPRESENTED BY SECRETARY TO
           GOVERNMENT, COOPERATIVE DEPARTMENT,SECRETARIAT,
           THIRUVANANTHAPURAM, PIN - 695001

    3      REGISTRAR OF CO-OPERATIVE SOCIETIES
           DEPARTMENT OF CO-OPERATION,OFFICE OF THE REGISTRAR OF
           CO-OPERATIVE SOCIETIES,JAWAHAR SAHAKARANA BHAVAN,DPI
           JUNCTION,THYCAUD P.O.,THIRUVANANTHAPURAM, PIN - 695014

    4      ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES
           (GENERAL), NEYYATTINKARA,
           THIRUVANANTHAPURAM 695 121, PIN - 695121

           BY ADVS.
           GOVERNMENT PLEADER
           PUBLIC PROSECUTOR



RESPONDENTS:

    1      Y.R.VINCENT,
           AGED 46 YEARS,
                                                     2025:KER:20170
WA NO. 1620 OF 2024

                                2


          FORMER PRESIDENT OF ARAYOOR SERVICE CO-OPERATIVE BANK,
          RESIDING AT V.S.BHAVAN, THOTTATHUVILA THOTTINKARA,
          PLAMOOTTUKADA P.O,
          THIRUVANANTHAPURAM, PIN - 691522

    2     K.P. KRISHNAN NAIR,
          FORMER COMMITTEE MEMBER OF ARAYOOR SERVICE CO-OPERATIVE
          BANK, RESIDING AT POOVANNARA HOUSE, ARAYOOR, ARAYOOR
          P.O, THIRUVANANTHAPURAM. 695122, PIN - 695122

    3     B.SATHEESH KUMAR,
          FORMER COMMITTEE MEMBER OF ARAYOOR SERVICE CO-OPERATIVE
          BANK, RESIDING AT VAZTHIVILA HOUSE, UDIYANKULANGARA,
          ARAYOOR P.O, THIRUVANANTHAPURAM, PIN - 695122

    4     A.PALRAJ,
          FORMER COMMITTEE MEMBER OF ARAYOOR SERVICE CO-OPERATIVE
          BANK, RESIDING AT P.H.BHAVAN, ARAYOOR, ARAYOOR P.O,
          THIRUVANANTHAPURAM, PIN - 695122

    5     R.GIRIJA,
          FORMER COMMITTEE MEMBER OF ARAYOOR SERVICE CO-OPERATIVE
          BANK, RESIDING AT MOOLAYIL HOUSE, ARAYOOR, ARAYOOR P.O,
          THIRUVANANTHAPURAM, PIN - 695122

    6     L.PREMALATHA,
          FORMER COMMITTEE MEMBER OF ARAYOOR SERVICE CO-OPERATIVE
          BANK, RESIDING AT PALLIVILA HOUSE, KOCHOTTUKONAM,
          ARAYOOR P.O, THIRUVANANTHAPURAM, PIN - 695122

    7     S. YAMUNAKUMARI,
          FORMER COMMITTEE MEMBER OF ARAYOOR SERVICE CO-OPERATIVE
          BANK, RESIDING AT PERINGALAMPADUPUTHEN HOUSE,
          KUDUPOTTUKUKONAM, VATTAVILA P.O,
          THIRUVANANTHAPURAM, PIN - 695132

    8     A.K BINDU,
          FORMER COMMITTEE MEMBER OF ARAYOOR SERVICE CO-OPERATIVE
          BANK RESIDING AT GURUKKALKUDIYIRIPPU HOUSE,
          UDIYANKULANGARA, ARAYOOR PO,
          THIRUVANANTHAPURAM, PIN - 695122

    9     M.RAVEENDRAN NAIR
                                                      2025:KER:20170
WA NO. 1620 OF 2024

                                   3


          FORMER SECRETARY OF ARAYOOR SERVICE CO-OPERATIVE BANK
          RESIDING AT MURALEERAVAM, NADOORKOLLAM, AMARAVILA P.O,
          THIRUVANANTHAPURAM. 695 122, PIN - 695122

    10    K.S. GIRIJA
          FORMER SECRETARY OF ARAYOOR SERVICE CO-OPERATIVE BANK
          RESIDING AT KRISHNASREE, R.C.STREET, NEYYATTINKARA.
          THIRUVANANTHAPURAM - 695 122, PIN - 695122

    11    ARAYOOR SERVICE CO-OPERATIVE BANK LTD NO. 692,
          ARAYOOR , NEYYATINKARA, THIRUVANTHAPURAM-695122
          REPRESENTED BY ITS SECRETARY., PIN - 695122

    12    THE ADMINISTRATOR,
          ARAYOOR SERVICE CO-OPERATIVE BANK LTD NO. 692, ARAYOOR,
          NEYYATINKARA, THIRUVANTHAPURAM-695122., PIN - 695122

    13    ADDL.R7. A.S.PRASAD
          S/O APPUKUTTAN NAIR,VALIYAPURA VEEDU,ARAYOOR
          P.O.,THIRUVANANTHAPURAM, PIN - 695122


          SR GP SRI T K VIPINDAS
          SRI P N MOHANAN
          SRI M SASINDRAN


     THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 04.03.2025,
THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
                                                       2025:KER:20170
WA NO. 1620 OF 2024

                                  4




                              JUDGMENT

AMIT RAWAL,J.

The present Intra-Court appeal at the behest of the

Joint Registrar, Co-operative Society and others is directed

against the judgment of the Single Bench dated 19.12.2023 in

WPC No.14402/2022, wherein the order dated 25.03.2022

under Section 68(1) of the Co-operative Societies Act passed

by the Joint Registrar, Co-operative Society,

Thiruvananthapuram, and notice dated 25.03.2022, Ext.P10

have been quashed by holding that it is not in compliance

with the provisions of Section 68(1) of the Kerala Co-operative

Societies Act and direction has been issued to fix the liability

individually.

2. Before the arguments in the aforementioned

appeal could be commenced, the learned counsel appearing

on behalf of the writ petitioners, who were the ex-members of

the committee in respect of the period 01.04.2013 to

31.03.2018, during which the alleged misappropriations and 2025:KER:20170 WA NO. 1620 OF 2024

illegalities regarding the appointment and disbursal of loans

with lessor interest have occurred, raised the objection qua

maintainability of the appeal, in view of the order dated

18.01.2024 passed in WA No.95/2024 filed by the Arayoor

Service Co-operative Bank against the same very judgment.,

which was permitted to be withdrawn with a further

submission that the State counsel did not express any

aversion in adhering to the directions of the identical

judgment in the aforementioned writ appeal as well as in the

present writ appeal. In other words, it is contended that the

State is estopped from challenging the same, an attempt is

being made to re-argue the matter.

3. On the other hand, Mr.Vipindas, learned

Government Pleader, pointed out that the Arayoor Service Co-

operative Bank had already been under the legal scanner in

various proceedings, including Writ Appeal No. 226 of 2024,

decided on 27.05.2024, wherein the show cause notice

was issued to the Society regarding the proceedings

for mismanagement and in the meantime, appointed a 2025:KER:20170 WA NO. 1620 OF 2024

former District Judge as an interim Administrator, restraining

the Managing Committee of the Co-operative Society from

taking any decision to run the Co-operative society, noticing

the fact that the Kerala Bank had also extended the loan

facility of Rs.9,40,00,000/- and the Society had been in

default in making the payment. It was further contended that

ultimately, with the change of the counsel, the liability of the

appellant therein was discharged, the interim order was

complied with and the writ appeal was closed.

4. Even otherwise it is submitted that RP.No.296/2025

has been filed in the WA.No.95 of 2024 to expunge the

following findings with regard to the contention of the State

recorded in paragraph 4 of the order dated 18.01.2024:

"4. Learned Government Pleader submits that the Registrar would not be averse in adhering to any directions this Hon'ble Court deem it appropriate."

5. In fact, it was an attempt to overcome the

institution of the writ appeal by the State, and this fact is also

brought to the notice of this Court in the hearing dated 2025:KER:20170 WA NO. 1620 OF 2024

24.02.2025, recorded by us, that it was an attempt to

preempt the right of the State to assail the order.

6. It is settled law that the person who comes to the

court with unclean hands such act cannot be ignored in

any of the proceedings in view of the law laid down by

the Supreme Court in S.P.Chengalvaraya Naidu v.

Jagannath (1994 (1) SCC 1) and (1994 AIR 853). In this

view of the matter, we overrule the aforementioned

objections and proceed to decide the inter-court appeal on

merits.

7. There had been a series of litigation prior to the

institution of the writ petition in question. In the earlier round

of litigation, when the proceedings were initiated under

Section 68(1) of the Kerala Co-operative Society Act, writ

petitioners had approached this Court vide Writ Petition No.

12783/2021. The Single Bench of this Court vide judgment

dated 21.02.2022, Ext.P7, quashed the order under challenge

of disqualification and appointment of the administrator with

a direction to the Joint Registrar to pass fresh orders after 2025:KER:20170 WA NO. 1620 OF 2024

affording an opportunity of hearing, fixing the liability

individually. The aforementioned judgment was assailed

before the Division Bench in two appeals, one by the State as

WA.No.443 of 2022 and the other by the writ petitioners as

W.A.No.300/2022, both the writ appeals were dismissed by

judgment dated 6.4.2022.

8. In pursuance of the judgment of the Single Bench

of this Court in all the proceedings the inspection had already

taken place vide Ext.P1 on 28.09.2018 noticing certain

irregularities regarding the membership, disbursement of the

loan, settlement of the arrears for the period 2013-2018, and

functioning of the Society. The aforementioned inspection

was as per the provisions of Section 66 of the Kerala Co-

operative Societies Act.

9. Section 68 of the Kerala Co-operative Societies Act

empowers the Joint Registrar envisaging various situations,

either through a complaint or order or inspection, to initiate

the proceedings in order to point out that any person of the

committee had been responsible for misappropriation or 2025:KER:20170 WA NO. 1620 OF 2024

misutilisation of funds or the powers vested in them by virtue

of the bye-laws in extending any of the facilities not provided

in the bye-laws. Section 68 (2) envisages notice to all

individual persons as to why the surcharge proceedings for

the recovery of amounts attributed to each individual as per

the provisions of 68(1) should not be recovered.

10. It is pertinent to mention here that the report as

envisaged under Section 68(1) of the Act had already fixed

the liability individually of each of the persons, much less of

certain persons who had either not been on the rolls of the

committee or had retired or joined later or against the dead

persons. But the liability was fixed individually, and after

Ext.P2, the surcharge proceeding under Section 68(2) which

was Ext.P11 in the earlier round of litigation, dated

16.06.2021, was quashed by noticing that the person who

assumed the office/management after the period of

inspection could not have been charged, the period which

was beyond 31.03.2018.

11. In compliance of the directions of the Single 2025:KER:20170 WA NO. 1620 OF 2024

Bench, proceedings under section 68(2) was initiated,

deleting the persons who had not been responsible in the

management of the Society or had retired or joined later or

was not involved or not on duty during the period of

misappropriation, ie., from 01.04.2013 to 31.03.2018. The

Joint Registrar, Thiruvananthapuram, fixed the liability

individually of the persons referred to as in Subsection 1 of

Section 68 of the Act, of a loss of 2,17,37,762/- to be levied

from the responsible party, and vide Ext.P10 of same day

individual notices have been sent to all the erring officials. In

those Exts.P9 and P10 proceedings, though assailable under

Section 83(J) of the Kerala Co-operative Societies by way of

appeal, were assailed before the Single Bench in WPC.No.

14402/2022. Learned Single Bench on analysis of the

previous judgments as well as provision of the Act and

various authority in the judgment under challenge, found that

there had been a considerable decrease in the liabilities by

excluding the persons who were not on the rolls of the Society

as noticed in the previous round of litigation, but set aside 2025:KER:20170 WA NO. 1620 OF 2024

Exts.P9 and P10 on the ground that they are bad for the

reasons of not noticing the receipt of the considerable

amount by the Society. In other words, it also says that the

author of the order, ie., Joint Register in Exts.P9 and P10 had

not understood the directions of this court to mean a

reassessment of the individual liabilities of the members by

including the person who died and excluding the persons who

were not in office as the surcharge proceedings necessarily

has civil consequence. In other words, the pith and substance

of the judgment is that the orders under challenge before the

Single Bench did not fix the liability individually, ie., in stricto

sensu of the provision of Subsection 1 of Section 68 of the

Kerala Co-operative Societies Act.

12. Adv.Vipindas, the senior Government Pleader

submitted that by minutely examining the orders Exts.P9 and

P10 dated 25.03.2022, it is evident that the persons who

were not on the rolls or had retired or left or dead have been

excluded, and the legal heirs have been assigned the

responsibilities, including the one who had been in control 2025:KER:20170 WA NO. 1620 OF 2024

and charge of the affairs of the committee for the period

aforementioned, ie., 01.04.2013 to 31.03.2018, by fixing the

responsibility individually strictly as per the provisions of the

Act aforementioned.

13. Even otherwise, despite raising an objection in the

counter statement regarding non-availment of the alternative

remedy, there has been no adjudication either at the

beginning or in the penultimate paragraph of the judgment

under challenge.

14. The learned Single Bench has assumed the role of

an expert by giving the findings in paragraph 19, treading on

path of appreciation of disputed question of fact which is not

in the domain of judicial review under Article 226 of the

Constitution of India, as it is yet to be decided by the

Registrar, subject to the stand of all persons who have been

issued notice vide proceedings under Section 68(2) vide

Ext.P10. It is an attempt to forestall and preempt the right

and delay of the adjudication of the surcharge proceedings.

In none of the findings in Ext.P9, the liability has been fixed 2025:KER:20170 WA NO. 1620 OF 2024

jointly and severally but individually. But the entire focus had

been on other issue, therefore, there is abdication,

abberration and opaqness, therefore it is liable to be set

aside.

15. On the other hand, Mr.Sabari, learned counsel

appearing on behalf of the writ petitioners and

Adv.M.Sasindran for the 11 th respondent, supported the

findings of the Single Bench to contend that Ext.P9 does not

strictly comply with the requirement of law as envisaged

under Subsection 1 of Section 68 of the Act as the expression

used is 'person' and not the committee as a whole. In other

words, the liability cannot be fixed jointly and severally as has

been done by Ext.P9. There is no assumption of the role of

expert in examining the nitty-gritty of the liabilities by

treading on the path of the appreciation of the disputed

question of fact, as urged by the Government Pleader. The

judgment is perfectly legal and justified based upon the

authoritative pronouncements, therefore requires no

ponderance or adjudication as attempted to be done in the 2025:KER:20170 WA NO. 1620 OF 2024

present intra-court appeal.

16. We have heard the counsel for the parties and

appraised the paper book.

17. In the previous round of litigation, the Single

Bench of this Court had framed certain questions while

rendering the adjudication, those questions are extracted

hereunder:

"(a) Though the inspection under Section 66 related to the period from 01.04.2013 to 31.03.2018, the proceedings under Section 68 included period beyond 31.03.2018, which is not contemplated."

(b) Persons who assumed office/management after the period of inspection under Section 66 (ie. after 31.03.2018 have been surcharged under Section 68(2), which is impermissible.

(c) Persons who were not in management for the entire period in respect of which Section 66 inspection was conducted, but only portions thereof, have been mulcted with liability for the entire period, which is unsustainable.

(d) Liability of persons in management during the period in respect of which Section 66 inspection was conducted but were no more when Section 68 proceedings were initiated, is fastened on the other members of the Committee, which is erroneous.

(e) No opportunity was afforded to pay off the liability and avoid an order of surcharge.

18. On the basis of the aforementioned questions, 2025:KER:20170 WA NO. 1620 OF 2024

had disposed of the writ petition, W.P(C).12783 of 2021,

paragraph 17 of the judgment dated 21.02.2022 reads thus:

" Resultantly, Ext. P11 order and the consequential orders of disqualification and appointing an administrator are quashed. The 1st respondent shall pass fresh orders in the light of the findings entered into in this judgment, after affording an opportunity of hearing to the parties. Let orders be passed within a period of one month from the date of receipt of a copy of this judgment. Since administrator had been in management from 18.06.2021 he shall continue in office subject to the outcome of the proceedings."

19. For redressing the controversy, it would also be

appropriate to extract the provisions of Section 68 of the Act.

68.Surcharge.- (1) If in the course of an audit, inquiry, inspection or the winding up of a society, it is found that any person, who is or was entrusted with the organization or management of such society or who is or has, at any time been an officer or an employee of the society, has made any payment contrary to the Act and the rules or the bye-laws, or has caused any loss or damage in the assets of the society by breach of trust, or wilful negligence or mismanagement or has misappropriated or fraudulently retained any money or other property belonging to such society or has destroyed or caused the destruction of the records, the Registrar may, of his own motion or on the application of the committee, liquidator or any creditor, 2025:KER:20170 WA NO. 1620 OF 2024

inquire himself or direct any person authorised by him by an order in writing in this behalf, to inquire into the conduct of such person.

(2) Where an inquiry is made under sub-section (1), the Registrar may, after giving the person concerned, an opportunity of being heard, by order in writing, require him to repay or restore the money or other property or any part thereof, with interest at such rate, or to pay contribution and costs or compensation to such extent, as the Registrar may consider just and equitable.

60[(3)Where the money, property, interest, cost or compensation is not repaid or restored as per sub-section (2), the Registrar shall take urgent steps to recover such amounts from the concerned persons as arrears of public revenue due on land as specified in Section 79 of the Act.]

20. On perusal of the provisions of Subsection 1 of

Section 68, it is evident that the competent authority, in the

course of audit, inquiry, inspection or winding up, finds that

any person who was interested in the organization,

management of the Society or at any point of time had been

the officer or employee of the Society made a payment

contrary to the Act and Rules of the bye-laws, or causes loss

and damage, the competent authority/Registrar may, of his

own motion or on the application of the committee, liquidator, 2025:KER:20170 WA NO. 1620 OF 2024

or any creditor, inquire himself or direct any person

authorised by him by an order in writing to inquire into the

conduct of such person, whereas Subsection (2) provides

that after giving the opportunity of the person mentioned in

Subsection 1, shall require the person if found liable to pay

the money along with the interest at such rate to be fixed by

the Registrar. The entire thrust of the judgment of Single

Bench had been on the premise that the order Exts.P9 and

P10 failed to address the provisions of Subsection 1 of Section

68 by fixing the liability individually. We would like to refer to

the following paragraphs of the judgment:

18. In Ext.P7 judgment, this Court has specifically said that as regards loss caused to the Society by the deceased office bearers, appropriate steps have to be taken in accordance with the law. Necessarily, when liability is to be fixed on deceased persons, their legal representatives will have to be put on notice, and liabilities can be fixed only to the extent of the assets that they have inherited from the deceased. This Court had specifically held in Ext. P7 that the liability is not joint and several as between the members of the Committee. As such, the liability if any of the deceased cannot be fastened to the other members of the Committee. Exts.P9 and P10, hence, to the extent they do not proceed to fix the liability of the deceased persons in 2025:KER:20170 WA NO. 1620 OF 2024

accordance with the law, cannot be sustained.

19. Another aspect that is relevant is with regard to the findings on the difference between the value of the assets and liabilities. The amounts were fixed in the surcharge proceedings in Ext. P6 based on a finding that there is an increase in the difference between assets and liabilities to the extent of Rs.22,75,590/-. It is not known how the very same amount has formed the basis for fixing the surcharge in Exts. P9 and P10, while admittedly, a sum of Rs.64,87,118/- has been remitted, thus causing a considerable decrease in the liabilities. It does not stand to reason that after the liabilities have reduced considerably, the increase in the difference between the assets and liabilities will remain the same in Ext.P6 and Exts. P9 and

10. Apparently, the remittance of the amount has not even been considered while fixing the liability in Exts.P9 and P10.

This is only one glaring example of the discrepancies in the reconsideration, which is claimed to have been done after the judgment of this Court. As contended by the petitioners and as is evident from the Exts. P9 and P10 report, there has only been a re-assessment of the liabilities of each person based on their period in Office, and there has not been any reconsideration of the issue of whether the surcharge proceedings are to be initiated based on the findings in the inquiry. When fresh orders are directed to be issued after quashing the order of surcharge issued earlier, what is required is not a mere quantification based on the materials collected in the enquiry. Nor could the respondents have taken into account the very same amount in Ext.P6, which is already set aside, and apportion the said amount differently between members, based on their period in the Committee alone. That was not what was directed in Ext. P7. A surcharge proceeding necessarily has civil consequences, and after rendering a finding regarding the liability of petitioners individually, the amount of liability is to be quantified based on the actual loss that has been sustained by the Society. Such an actual loss has to be calculated on the basis of the materials which are 2025:KER:20170 WA NO. 1620 OF 2024

available. When Ext.P10 itself gives credit to amounts that have been repaid, it was necessary that the heads of liabilities for surcharge are also subjected to necessary changes. It would appear from a reading of Exts. P9 and P10 that the author of the order has only understood the directions in the judgment of this Court to mean a re- assessment of the individual liabilities of the members by including persons who have died and excluding persons who are not in office. I am hence of the opinion that Exts.P9 and P10 cannot be sustained since they are not in accordance with the law laid down in the decisions referred to above or in accordance with the directions issued in Ext.P7 and are also not sustainable on the facts revealed in the enquiry. They are bad for the reason that they have not considered amounts which have been received by the Society, admittedly. They are also bad for the reason that they proceed on the basis of the liability of the Committee rather than on individual liability, which needs to be assessed in terms of Section 68, Exts.P9 and P10 are hence set aside. There will be a direction to the 1 respondent to pass fresh orders in accordance with the direction contained in Ext. P7 judgment as affirmed by the Division Bench and based on the observations made above, if they intend to continue with proceedings pursuant to Exts.P1 and P2.

20. The prayer in the writ petition is to quash Ext.P10 order produced therein and for a direction to the 2nd respondent to hand over the minutes of the Society taken by him as evidenced by Ext. P9 receipt and to give necessary aid for the discharge of duties to the Managing Committee members as and when required. Ext.P10 proceeds on the basis that the petitioners had forcefully taken possession of the minutes book of the Society and the same is to be retrieved by means of proceedings under Section 34 of the KCS Act. It can be seen from Ext.P9 that the minutes book had been taken custody of by the 2nd respondent, and hence, the basis of Ext.P10 order does not exist. Ext.P10 cannot hence be sustained and is hence quashed.

2025:KER:20170 WA NO. 1620 OF 2024

Regarding the prayer for a direction to the 2nd respondent to hand over the minutes book to the petitioner and to provide aid for the functioning of the Committee, since the period of the Committee has expired on 4.11.2023, the prayer is no longer relevant, and hence no further orders are necessary. The writ petition is disposed of as above.

21. The prayer in the writ petition is for a direction to respondents 1 and 3 to hand over the administration of the bank to the petitioners as the term of the Administrator was over on 20.06.2022 and in view of Exts.P6 and P7 orders issued pursuant to Exts.P4 and P5 judgments. In the judgment in W.P.(C)No.14402 of 2022, Exts.P4 and P5, which have been produced as Exts.P9 and P10 therein, have been quashed. The term of the Committee constituted by the petitioners also expired on 4.11.2023. What is hence required is a proper election to the Committee and handing over charge to the newly elected Committee. In the above circumstances, this writ petition is disposed of directing the respondents to take steps to conduct the election to the Committee of the 2nd respondent Bank at the earliest."

21. Moreover, on perusal of the order Ext.P9, it is

evident that steps were taken to rectify the mistake that

occurred in the earlier round while passing the order under

Subsection 1 of Section 68, and the liability as per Ext.P9 was

only on the persons who had been in control of the

management for the period 01.04.2013 to 31.03.2018. Even

otherwise, all the individual persons have now been prima

facie found to be involved and have a right to defend on 2025:KER:20170 WA NO. 1620 OF 2024

receipt of the show cause notice, Ext.P10, by filing a reply and

lead evidence in support of their respective stands. In our

considered view it was an attempt to thwart and delay the

adjudication of the proceedings contemplated to be initiated

under Section 68. We do not find any ambiguity or non-

compliance of the provisions of Subsection 1 of Section 68,

whereby the order Ext.P9 lacks in fixing of liability on an

individual person. Even the learned Single Bench has failed

to address the different heads whereby liabilities were fixed

on different persons. The order Ext.P9 is self contained and

descriptive. Even otherwise no explanation has come forth in

not availing the alternative remedy. Be that as it may.

22. The reasoning of the Single Bench that the

expression "any person" could not mean the member of the

committee, in our considered view, is also not a correct

interpretation for the reason that the person mentioned in

Section 68 would also include in the management committee

as per the ratio decidendi culled out in Mahendran v. Joint

Registrar of Co-operative Societies (General) (2019 (3) 2025:KER:20170 WA NO. 1620 OF 2024

KLT 627).

23. Section 2(e) of the Kerala Co-operative Societies

Act defines the 'committee', which means a governing body

of the Co-operative Society by whatever name it is called, to

which the Management of the affairs of the Society is

entrusted, whereas Section 2 defines the officer. Thus by

going by the provisions of Section 2(e), the person mentioned

in Section 68 would also include the managing committee

members. Even otherwise, as per the provisions of Section

3(42) of the General Clauses Act, the persons shall also

include a company or association or body of the individuals

and Section 9 of the Co-operative Societies Act prescribes the

registration of the Society shall render it to a body co-

operate.

24. We are of the view that the judgment of the

Single Bench cannot be sustained for the

petitioners/respondents would have a right to defend while

replying to the show cause notice as noticed above, in

accordance with law and the matter may culminate into any 2025:KER:20170 WA NO. 1620 OF 2024

of the findings either in favour of or against the respondents

but not in the manner and mode as noticed above. The

judgment of the Single Bench is set aside. Writ Appeal stands

allowed.

Sd/-

AMIT RAWAL JUDGE

Sd/-

K. V. JAYAKUMAR JUDGE msp