G.K.Ragasudha, v. Deputy Registrar Of

IN THE HIGH COURT OF JUDICATURE AT MADRAS

DATED: 23.08.2017

CORAM

THE HON'BLE MR. JUSTICE D. KRISHNAKUMAR WP.No.20771 of 2015 and MP.No.1 of 2015

1. G.K.Ragasudha, Rep.by mother and natural guardian S.Geetha

2. G.K.Udaya Raka, Rep.by mother and natural guardian S.Geetha ..Petitioners Vs.

1. Deputy Registrar of Cooperative Societies, Cuddalore - (Po) & (Dt).

2. Sale Officer, Office of the Deputy Registrar of Cooperative Societies, Cuddalore - (Po) & (Dt).

3. President, Cuddalore and Villupuram District Treasury Department Employees Cooperative Thrift and Credit Society Limited, Cuddalore (Po) & (Dt), Pin: 607 001 ..Respondents PRAYER:

The Writ Petition is filed under Article 226 of the Constitution of India to issue a writ of certiorari calling for the records of the First Respondent relating to his two orders dated 29.04.2015 bearing ARC.No.35/2015-16 and CEP.1/2015-16 and of the Second Respondent relating to his order dated 06.05.2015 and to quash the said orders dated 29.04.2015 and 06.05.2015 insofar as they relate to the properties of the Petitioners in Sl.Nos.1 to 4 of the impugned orders .

For petitioners : Mr.A.Praveenkumar for M/s.P.Anbarasan For respondents : Mr.L.P.Shanmugasundaram, Special Government Pleader for R1 & R2 : Mr.E.M.S.Natarajan for R3 ORDER:

The learned counsel for the petitioners would submit that the petitioners are minor and daughters of Kesavan and S.Geetha. When the petitioners' mother was working as the Secretary of the Cuddalore and Villupuram Districts Cooperative Thrift and Credit Society Limited, Cuddalore, she was suspended from service of the society stating that an enquiry under Section 81 of the Tamil Nadu Cooperative Societies Act had been ordered for certain alleged irregularities. While being so, the first respondent issued a notice dated 29.04.2015 directing petitioners' mother to furnish a security for a sum of Rs.11,91/-,135 on or before 06.05.2015 to satisfy any decree or order that may be passed against her. Further, without waiting for any reply from the petitioners' mother, the first respondent passed another notice dated 29.04.2015 making conditional attachment of the properties of the petitioners. Pursuant to that, the second respondent has also passed an order dated 06.05.2015 making conditional attachment of the properties of the petitioners.

2. The learned counsel for the petitioners would further submit that the properties which have been conditionally attached are purchased by the petitioners' father whereas the said orders have been passed against the petitioners' mother, who is alleged to have committed certain irregularities while working as Secretary in the above society. The learned counsel for the petitioners would further submit that the impugned orders are patently illegal, contrary to legal provisions and are only orders of interim nature and there is no effective legal remedy to the petitioners, who are third parties to whom the provisions of the Tamil Nadu Cooperative Societies Act are not applicable. Hence, the petitioners have filed this writ petition before this Court.

3. The learned Special Government Pleader brought to the notice of the Court that in similar matter, this Court has passed an order in W.P. Nos.11143 to 11146 of 2015 dated 17.04.2015, wherein this Court had followed the earlier order passed in W.P. Nos. 38843 & 38844 of 2015, by its order dated 10.12.2015 and set aside the impugned order. The said order passed by this Court squarely applies to this case.

4. In view of the submissions made by the learned counsel for the parties, the order passed by this Court in W.P. Nos.11143 to 11146 of 2015 dated 17.04.2015, wherein it is held as follows :- "9. It is relevant to extract Section 167 as well as Rule 140 of the Co-Operative Societies Act.

'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 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 subsection (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 subsection (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:

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. Rule 140. Mode of making attachment before judgment:

(1) Attachment of property under Section 167 shall be made in the manner provided in the foregoing rules of this chapter.

(2) Where a claim is preferred to property attached under sub-rule (1) such claim shall be investigated in the manner and by the authority specified in the foregoing rules of this chapter.

(3) Where a direction is made for the attachment of any property under sub-rule (1), the Registrar shall order the attachment to be withdrawn.- (a) when the party concerned furnishes the security required together with the security for the cost of the attachment; or (b)When the Registrar makes an order under sub-section (1) of Section 167 that the party concerned need not repay or restore any money or property or contribute any sum to the assets of the society by way of compensation; or (c) when the dispute referred to in sub-section (1) of section 90 has been decided against the party at whose instance the attachment was made; or (d) when the liquidator determines under clause (b) of sub-section (2) of section 139 that no contribution need be made by the party concerned.

(4) Attachment made under sub-rule(1) shall not affect the rights existing prior to the attachment of persons not parties to the proceedings in connection with which the attachment was made, not bar any person holding a decree against the person whose property is attached from applying for the sale of property under attachment in execution of such decree.

(5) Where property is under attachment by virtue of the provisions of this rule and a decree is subsequently passed against the person whose property is attached, it shall not be necessary upon an application for execution of such decree to apply for re-attachment of the property.'

10. A perusal of the impugned order would disclose that in terms of Section 167(1), no order has been passed calling upon the petitioners 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. Admittedly, the impugned order is dated 09.04.2015 and the petitioners were called upon to furnish security for the said sum on the very same date. According to the petitioners the notices were served on them by force on the very same date.

11. In the light of the said infirmity, it is not necessary for the writ petitioners to invoke the alternative remedy available as pointed by the learned counsel appearing for the respondents 1 to 5.

12. In the result, all the writ petitions are partly allowed and the impugned order dated 09.04.2015 is set aside and the matter is remitted back to the third respondent for fresh adjudication in accordance with Section 167 of the Tamil Nadu Co-Operative Societies Act r/w. Rule 140 of the Tamil Nadu Co-Operative Societies Rules.

It is made clear that in the interregnum, the petitioners shall not alienate or encumber or create third party rights in respect of the immovable properties. The third respondent shall make every endeavour to pass fresh orders in terms of the above said provisions within a period of eight weeks from the date of receipt of a copy of this order. No costs. Consequently, the connected miscellaneous petitions are closed. "

It cannot be disputed by the respondents that the legal issue involved in these writ petitions is squarely covered by the order passed by this Court in W.P.Nos.11143 to 11146 of 2015, referred to above. Following the aforesaid judgment, this Court in W.P. Nos. 38843 & 38844 of 2015, by its order dated 10.12.2015, has set aside the impugned order and the matter was remitted back to the 2nd respondent therein, for fresh adjudication, in accordance with Section 167 of the Tamil Nadu Co-operative Societies Act r/w Rule 140 of the Tamil Nadu Co-operative Societies Rules.

5. Considering the above submissions and in the light of the aforesaid decision of this Court, I have no hesitation to set aside the impugned orders and therefore I am inclined to pass the following order :

i. The impugned order passed by the first respondent relating to his two orders dated 29.04.2015 bearing ARC.No.35/2015-

16 and CEP.1/2015-16 and of the Second Respondent relating to his order dated 06.05.2015 are set aside and the matter is remitted to the 1st respondent for fresh adjudication, under Section 167 of the Tamil Nadu Co-operative Societies Act r/w Rule 140 of the Tamil Nadu Co-operative Societies Rules.

ii. In the meantime, the respondents shall not alienate or encumber the immovable properties, which is the subject matter of this writ petition.

iii.The 1st respondent shall consider the matter afresh and pass appropriate orders, in accordance with the above said provisions of law, within a period of twelve weeks from the date of receipt of a copy of this order.

7.

Accordingly, the writ petition is allowed. Consequently, the connected Miscellaneous Petition is closed. No costs.

Sd/- Asst.Registrar (CS V ) /true copy/ Sub Asst. Registrar lok To

1. Deputy Registrar of Cooperative Societies, Cuddalore - (Po) & (Dt).

2. Sale Officer, Office of the Deputy Registrar of Cooperative Societies, Cuddalore - (Po) & (Dt).

3. President, Cuddalore and Villupuram District Treasury Department Employees Cooperative Thrift and Credit Society Limited, Cuddalore (Po) & (Dt), Pin: 607 001 +1CC TO GOVERNMENT PLEADER SR.61671 WP.No.20771 of 2015 and MP.No.1 of 2015 SS(24/10/2017)