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Ramachandra S Bhagavat vs The State Of Karnataka on 2 June, 2014

Karnataka High Court Ramachandra S Bhagavat vs The State Of Karnataka on 2 June, 2014Author: A.N.Venugopala Gowda

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IN THE HIGH COURT OF KARNA TAKA

DHARWAD BENCH

DATED TH IS THE 2 N D DAY OF JUNE 2014 BEFORE

THE HON’BLE MR.JUS TICE A.N.VENUGOPALA GOWDA WRIT PETITION NO.85771/2013 (CS-RES) BETWEEN

RAMACHANDRA S BHAGAVAT

AGE: 72 YEARS ,

OCC: ADVOCACY, R/O. KUM TA

DIST: U TTA R KANNADA.

… PETITIONER

(BY SRI. DINESH M KULKARNI, ADV.) AND

1. THE S TA TE OF KARNA TAKA

R/BY ITS SECRETARY,

DEPARTMENT OF CO OPERA TIVE

M S BUILDING, BANGALORE.

2. THE REGIS TRAR OF COOPERA TIVE SOCIETIES,

NO. 01, ALIASKAR ROAD,

KARNATAKA S TA TE, BANGALORE.

3. THE JOINT REGISTRA R OF

CO-OPERATIVE SOCIETIES

BELGAUM REGION, BELGAUM.

4. THE KDCC BANK LTD .,

SIRSI,

R/BY ITS MANAGING DIRECTOR,

SIRSI, DIS T: U TTAR KANNADA

… RESPONDENTS

(BY SMT. K. VIDYAVA THI, AGA.)

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THIS WRIT PETITION IS FILED UNDER A RTICLES 226 AND 227 OF THE CONS TITU TION OF INDIA , PRAYING TO QUASH THE ENDORSEMENT ISSUED BY RESPONDENT NO.3 VIDE ANNEXURE-H DA TED 17.06.2013 AS NULL AND VOID AND TO ISSUE DIRECTION TO THE RESPONDENT NO.3 TO COMPLY THE ORDER PASSED IN W.P.NO .66974/2012, DA TED 19.2.2013, VIDE ANNEXURE-G, ETC. THIS WRIT PETITION COMING ON FOR PRELIMINARY HEARING , TH IS DAY, THE COURT MADE THE FOLLOWING:

ORDER

Petitioner is a member of respondent No.4- Co-operative Bank. He was elected as a director of the bank. He had lodged a complaint on 28.11.2008 before respondent no.2 alleging acts of misappropriation and thereby causing deficiency in the funds and assets of respondent no.4. Based on the said complaint respondent no.2 issued a direction on 20.12.2008 to respondent no.3 to initiate an enquiry into the affairs of the respondent no.4. An Enquiry Officer having been appointed, conducted enquiry under Section 64 of the Karnataka Co-operative Societies Act, 1959 (hereinaf ter ref erred to as ‘the Act’ f or short) and :3:

submitted report which revealed the causing of deficiency in the funds and assets of the society. In furtherance of the said report the respondent no.3 issued an order on 24.3.2010 under Section 68(1) of the Act, directing the respondent no.4 to initiate further action and submit compliance report within 45 days. Respondent no.2 sent a communication dated 19.1.2012 to respondent no.3 to submit explanation and the action taken report insofar as the aforesaid aspects are concerned. Alleging inaction on the part of the authorities concerned, W.P.No.66974/2012 was filed and the same was disposed of on 19.2.2013 with a direction to the 3 r d respondent to consider a notice, which the petitioner had caused on 11.7.2012. Respondent no.3 having issued an endorsement in compliance of the order passed in W.P.No.66974/2012, this writ petition was filed, to quash the endorsement dated 17.6.2013, vide Annexure-H and direct the respondent no.3 to :4:

comply with the order passed on 19.2.2013 in W.P.No.66974/2012, vide Annexure-G.

2. Sri Dinesh M. Kulkarni, learned Advocate, contended that the impugned endorsement is arbitrary and illegal. He submitted that the petitioner was not granted opportunity of hearing to substantiate his contentions and that mechanically the impugned endorsement was issued. He submitted that the respondent no.3 ought to have initiated further action under Section 69 of the Act against the officers and members of the managing committee of respondent no.4, who are responsible for the deficiencies which have been pointed out in the enquiry report submitted pursuant to the enquiry held under Section 64 of the Act.

3. Smt.K.Vidyavathi, learned AGA, on the other hand submitted that, pursuant to the mandamus issued on 19.2.2013 in W.P.No.66974/2012, further action was taken. :5:

She submitted that having regard to the events which have taken place, the compliance reports having been submitted by the respondent no.4, each item was examined and factual position was verified and the petitioner was informed on 17.6.2013 vide Annexure-H. She further submitted that in the facts and circumstances of the case, the writ petition is untenable.

4. Perused the writ record & considered the rival contentions.

5. W.P.No.66974/2012 was filed to direct the Joint Registrar of Co-operative Societies, Belgaum Division, Belgaum, to consider the notice dated 11.7.2012 of the petitioner. The writ petition was disposed of on 19.2.2013 directing the respondent no.3 to consider the said notice. Respondent no.3 having examined the record relating to the holding of enquiry under Section 64 of the Act and the order passed under Section 68 of the Act as well as the compliance reports :6:

submitted by the Managing Director of the bank, has informed the petitioner itemwise/issuewise, the action taken. The claim of the petitioner that there ought to have surcharge proceedings under Section 69 of the Act, suo-motu by the Registrar, in my opinion, at this stage, is unwarranted. The respondent no.3 after receipt of the final compliance report from respondent no.4 in respect of the matters pointed out in the order passed under Section 68 of the Act should examine as to whether there is a need for proceeding under Section 69 of the Act. It is also open to the petitioner to raise a dispute under Section 70 of the Act against the members/past members and the persons claiming through the members or the managing committee members as well as the employees past or present and if such a dispute is instituted, the jurisdictional Registrar shall decide the same in accordance with law. In such a dispute the petitioner can place reliance on the enquiry report as well as the consequential order :7:

passed under Section 68 of the Act. If there is non compliance of any aspects pointed out in the enquiry report and the statutory order passed under Section 68 of the Act, the same is required to be examined and the case be decided by the Registrar.

Subject to the above, writ petition is disposed of.

Smt.K.Vidyavathi, learned AGA, is permitted to file memo or appearance within four weeks. SD/-

JUDGE

Mrk/-

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