Central Co- Operative Bank Ltd v. Registrar Cooperative Socities, Sahkar Bhavan, Jaipur

Judgment

2. Registrar Cooperative Socities, Sahkar Bhavan, Jaipur Additional Register, Co- Operative Societies, Jaipur Zone, Jaipur

3. Joint Chief Auditor (General), Co- Operative Societies, Jaipur Zone, Jaipur

4. Regional Audit Officer, Co- Operative Societies, Jaipur Zone, Jaipur

5. Jhunjhunu Kray Vikray Sahkari Samiti Ltd., Jhunjhunu Through General Manager

6. State Minister (Independent Charge) Co-operative Societies, Govt. of Rajasthan, Jaipur ----Respondents For Petitioner(s)

: Mr. Rahul Kamwar For Respondent(s) : HON'BLE MR. JUSTICE MAHENDAR KUMAR GOYAL Judgment / Order 04/08/2025 Amended cause title submitted by the learned counsel for the petitioners is taken on record. Under challenge in the writ petition are the letter dated

27.06.2025 issued by the Additional Registrar, Co-operative Societies, Bikaner Division, Bikaner whereby, the petitioner has been afforded an opportunity to file his response in writing before the enquiry committee, the order dated 16.6.2025 passed by the respondent No.6-the Minister Cooperative, Government of [2025:RJ-JP:29643] (2 of 4) [CW-10637/2025] Rajasthan dismissing the revision petition preferred by the petitioner under Section 107 of the Rajasthan Co-operative Societies Act, 2001 (for short, “the Act of 2001”), the order dated

05.11.2024 passed by the Registrar, Co-operative Societies, Rajasthan, Jaipur dismissing the revision petition preferred by the petitioner under Section 107 of the Act of 2001 and the order dated 11.09.2023 passed by the Additional Registrar, Co-operative Societies, Jaipur Division, Jaipur extending the time for completing the enquiry under Section 55 of the Act of 2001 with a further direction to quash the interim enquiry report. The relevant facts in brief are that a special audit was conducted with regard to sale and purchase by the Jhunjhunu Kray Vikray Sahkari Samiti Ltd., Jhunjhunu (for short, “ the Society”) for certain period including the period for which the petitioner was its General Manager wherein, certain financial irregularities were found. Thereafter, an enquiry under Section 55 of the Act of 2001 was initiated against the Society vide order dated 13.04.2023. Vide amended order dated 11.09.2023, time for completion of the enquiry was extended by two months. A revision petition preferred by the petitioner thereagainst came to be dismissed by the Registrar, Co-operative Societies, Rajasthan, Jaipur vide order dated 05.11.2024 which was unsuccessfully challenged by him by way of further revision under Section 107 of the Act of 2001 which came to be dismissed by the respondent No.6 vide order dated 16.06.2025. Assailing the aforesaid orders, the only contention advanced by learned counsel for the petitioner, relying on the provisions of the Section 57, is that once a special audit was conducted under [2025:RJ-JP:29643] (3 of 4) [CW-10637/2025] Section 54(12), no enquiry is permissible under Section 55. He, therefore, prays that the writ petition be allowed, the orders impugned be quashed and set aside and a direction be issued to quash the interim enquiry report. Heard. Considered. The facts are not in dispute that on finding the financial irregularities committed by the Society for the subject period in a special audit conducted under the Section 54(12) of the Act of 2001, an enquiry under Section 55 is in progress against the Society. To better appreciate the submission made by the learned counsel for the petitioner, it would be profitable to quote Section 57 as under:

57. Surcharge - (1) If on the basis of an audit, inquiry, inspection or a Liquidator's report made under the provisions of this Act, it comes to the knowledge of the Registrar that any person, who has taken any part in the organisation 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 provisions of this Act, the rules or the bye-laws or has caused any deficiency in the assets of the society by wilful negligence or has misappropriated or fraudulently retained any money or other property belonging to such society, the Registrar may, 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: • Provided that no inquiry into the conduct shall be done under this section by a person who has earlier submitted report of audit, inquiry, inspection or liquidation in the same matter: [2025:RJ-JP:29643] (4 of 4) [CW-10637/2025] • Provided further that no such inquiry shall be held after the expiry of six years from the date of an act or omission or after the expiry of two years from the date of knowledge of the Registrar of such act or omission: • Provided also that any business loss occurred due to an act done or decision taken in the interest of the society with a common business prudence shall not be a subject matter of such inquiry. (2) Where an inquiry is made under sub-section (1), the Registrar may, after giving the person concerned an opportunity of representing his case, make an order requiring him to repay or restore the money or 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. (3) This section shall apply notwithstanding that such person or officer may have incurred criminal liability by his act. Even, minute and thorough examination of the aforesaid provisions contained under Section 57 does not reflect that the enquiry under Section 55 is barred once a special audit is conducted under Section 54(12) of the Act of 2001. Despite opportunity, except making a bald assertion that such enquiry is barred under the law, learned counsel for the petitioner also could not substantiate it by any legal provision/citation. Resultantly, this writ petition is dismissed being devoid of merit. Pending application(s), if any, also stands disposed of. YOGESH/20 (MAHENDAR KUMAR GOYAL),J