Madras High Court
R.Arivazhagan vs The Joint Registrar Of ... on 5 September, 2023
W.P.No.21143 of 2023
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 05.09.2023
CORAM
THE HONOURABLE MR. JUSTICE S.SOUNTHAR
W.P No.21143 of 2023
and
W.M.P.No.20534 of 2023
R.Arivazhagan ...Petitioner
Vs.
1.The Joint Registrar of Co-operative Societies
Nagapattinam Zone
Nagapattinam.
2.The Deputy Registrar of Co-operative Societies
(Full Additional Charge)
Nagapattinam Circular
Nagapattinam.
3.The Sub-Registrar of Co-operative Societies
Inspection Officer under Section 82
Thalanayar
Vedaraniyam Taluk
Nagapattinam District.
4.The Secretary
Aymoor Primary Agriculture Co-operative Credit Society Limited
-ZC73
Aymoor Village
Thirukkuvalai Taluk
Nagapattinam District.
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W.P.No.21143 of 2023
5.The Sub-Registrar
Thirukkuvalai Sub-Register Office
Thirukkuvalai Taluk
Nagapattinam District. ...Respondents
Prayer: Writ Petition filed under Article 226 of the Constitution of India, for
issuance of a Writ of Certiorari, to call for the entire records in relation to the
impugned notice dated 27.06.2023 issued by the second respondent in Form
No.6 in Ni.Ve.Ma.No.03/2023-2024 to furnish security before attachment and
the impugned Conditional Attachment Order dated 27.06.2023 issued by the
second respondent under Section 167 of the Tamil Nadu Cooperative Societies
Act, 1983 in CEP.No.3/2023-2024 and to quash the same.
For Petitioner : Mr.S.Senthil
For Respondents : Mr.C.Selvaraj for R1 to R3
Additional Government Pleader
Mr.G.Nanmaran for R4 & R5
Special Government Pleader
ORDER
This Writ Petition is filed challenging the order passed by the
second respondent issuing notice to the petitioner to furnish security to the
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W.P.No.21143 of 2023
tune of Rs.45 lakhs and also an order attaching the immovable properties of
the petitioner by invoking Section 167 of the Tamil Nadu Co-operative
Societies Act.
2. The impugned order is challenged by the petitioner mainly on
the ground that no proceedings were initiated against the petitioner either
under Section 87 of the Co-operative Societies Act or Section 90 of the Co-
operative Societies Act, for attaching the properties of the petitioner.
3. The learned counsel for the petitioner also submitted that the
notice to furnish security was issued to the petitioner on 27.06.2023 and on the
very same day, the impugned order attaching the properties of the petitioner
was also passed and the same is not in accordance with Section 167 of the
Tamil Nadu Co-operative Societies Act.
4. Mr.C.Selvaraj, learned Additional Government Pleader
appearing for the respondents 1 to 3 and Mr.G.Nanmaran, learned Special
Government Pleader appearing for the respondents 4 & 5 by taking this Court
to the counter affidavit of the second respondent submitted that during
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W.P.No.21143 of 2023
inspection certain irregularities were found in the affairs of the fourth
respondent society and therefore, 82 enquiry was ordered by the second
respondent on 30.01.2023 and the said enquiry is under progress.
5. It is further submitted by the learned Additional Government
Pleader appearing for the respondents 1 to 3 that the interim report of the
Investigation Officer revealed that there was misappropriation of funds to the
tune of Rs.45 lakhs by the petitioner and other staff members of the society
and therefore, it is likely the petitioner may alienate the immovable properties
so as to escape from the clutches of law. In order to prevent such alienation,
the second respondent was constrained to invoke Section 167 of the Tamil
Nadu Co-operative Societies Act, for attachment of the immovable properties
of the petitioner.
6. Section 167 of the Tamil Nadu Co-operative Societies Act,
reads as follows:
“167. Furnishing of security and attachment of
property:__(1) Where the Registrar is satisfied on the
application of a registered society in respect of a reference
made to him under sub-section (1) of section 90 or on the
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W.P.No.21143 of 2023
application of a liquidator appointed under section 138 in
respect of the proceedings of such liquidator for determining
the contribution to be made by a person to the assets of the
society under clause (b) of sub-section (2) of section 139 or on
the application of the board or liquidator or any creditor to
the society or otherwise in respect of any inquiry ordered into
the conduct of any person under section 87 that any party to
the reference or the person, as the case may be, is about to
dispose of or remove from the local limits of the jurisdiction of
the Registrar, the whole or any part of his property with intent
to defeat or delay the execution of any decision that may be
passed on the reference or of any order that may be passed
against him by the liquidator or the Registrar, as the case may
be, the Registrar may, by order, direct the party or the person,
to furnish security in such sum and within such time as may be
specified in such order and to produce and place at the
disposal of the Registrar when required, the said property or
such part thereof as may be sufficient for the execution of any
decision or order aforesaid.
(2) The Registrar may also in the order made under sub-
section (1), or by a separate order, direct the conditional
attachment of the said property, or such part thereof and such
attachment shall have the same effect as if it had been made by
a competent civil court:
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W.P.No.21143 of 2023
Provided that no order for conditional attachment shall
be made under this sub-section unless the Registrar, for the
reasons to be recorded in writing, is satisfied that the whole or
any part of the property will be disposed of or removed with
intent to defeat or delay the execution of any decision or order
of the liquidator or the Registrar, as the case may be.”
7. A careful reading of the above mentioned provision would
suggest that the order under Section 167 of the Act can be passed only in cases
where a proceedings is initiated under Section 87, 90, 138 or 139 sub-Section
2(b) of the Tamil Nadu Co-operative Societies Act.
8. In is the case on hand, admittedly only 82 enquiry is ordered
by the second respondent and the same is under progress. No surcharge
proceedings is initiated against the petitioner either under Section 87 of the
Co-operative Societies Act or Section 90 of the Co-operative Societies Act. In
such circumstances, a condition precedent for invoking Section 167 of the Act
is not at all satisfied. In this regard, it would be appropriate to refer the
judgment of this Court in V.Sundaram Vs. The Deputy Registrar Co-
operative Societies (Milk) Vellore Circle, Vellore District and another,
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W.P.No.21143 of 2023
reported in 2009 SCC Online Mad 61. This Court while considering the scope
of the power under Section 167 of the said Act, has observed as follows:
“....6. A plain reading of Section 167 of the Tamil
Nadu Co-operative Societies Act would make it clear that an
order of attachment before judgment under Section 167(1) of
the Act or conditional attachment under Section 167(2) of the
Act could be made only in cases where there is already a case
pending on the file of the Deputy Registrar either under Section
87 or under Section 90 or under Section 139 of the Tamil Nadu
Co-operative Societies Act. Without satisfying the said
condition precedent, it is not all available for the Deputy
Registrar to issue any order under Section 67 of the above said
Act....”
9. In view of the fact that the condition for invoking Section 167
of the Tamil Nadu Co-operative Societies Act is not satisfied, the impugned
order passed by the second respondent by invoking Section 167 of the Tamil
Nadu Co-operative Societies Act is not sustainable. Accordingly, the impugned
order is set aside and this Writ Petition is allowed.
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W.P.No.21143 of 2023
10. The allowing of this Writ Petition will not preclude the second
respondent from initiating fresh proceedings and pass orders under Section
167 of the Tamil Nadu Co-operative Societies Act in case subsequent to filing
of report by the Enquiry Officer, the second respondent choose to proceed
against the petitioner either under Section 87 of the Co-operative Societies Act
or under Section 90 of the Co-operative Societies Act. No costs. Consequently,
connected Miscellaneous Petition is closed.
05.09.2023
Index : Yes/No
Internet : Yes/No
Speaking Order/Non-Speaking Order
Neutral Citation Case : Yes/No
dna
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W.P.No.21143 of 2023
To
1.The Joint Registrar of Co-operative Societies
Nagapattinam Zone
Nagapattinam.
2.The Deputy Registrar of Co-operative Societies
(Full Additional Charge)
Nagapattinam Circular
Nagapattinam.
3.The Sub-Registrar of Co-operative Societies
Inspection Officer under Section 82
Thalanayar
Vedaraniyam Taluk
Nagapattinam District.
4.The Secretary
Aymoor Primary Agriculture Co-operative Credit Society Limited
-ZC73
Aymoor Village
Thirukkuvalai Taluk
Nagapattinam District.
5.The Sub-Registrar
Thirukkuvalai Sub-Register Office
Thirukkuvalai Taluk
Nagapattinam District.
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W.P.No.21143 of 2023
S.SOUNTHAR, J.
dna
W.P No.21143 of 2023
and
W.M.P.No.20534 of 2023
05.09.2023
https://www.mhc.tn.gov.in/judis
