BHAVNAGAR DISTRICT CO OP BANK LTD Vs. REGISTRAR
HIGH COURT OF GUJARAT
BHAVNAGAR DISTRICT CO-OP. BANKLTD
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(1.) THE short facts of the case appear to be that the petitioner is a Co-operative Bank registered as the Federal Co-operative Bank at the district level. It appears that a show-cause notice came to be issued by the Registrar, Co-operative Societies dated 10th April, 1997 calling upon the petitioner to show cause as to why inquiry should not be ordered to be held under Section 86 of the Gujarat Co-operative Societies Act, 1961 (hereinafter referred to as the 'act') pertaining to 29 loan transactions to ship-breaking and other industries by the Bank. The petitioner, at the initial stage, challenged the legality and validity of the said show-cause notice in the present petition and it was also prayed to quash and set aside the said notice and to restrain the respondents no. 1 and 2 from holding any inquiry under Section 86 of the Act. It further appears that the petitioner submitted the reply to the show-cause notice and contended inter alia that the loan transactions are legal and valid and no inquiry deserves to be ordered under Section 86 of the Act. It was also contended that the District Registrar or the representative of the State Registrar is a member of the Managing Committee of the Bank and, therefore, there is no power with the State Registrar to order inquiry under Section 86 of the Act. 1. 1 It appears that thereafter, the Registrar, vide order dated 15th September, 1997, considered the matter and found that the Joint Registrar (Finance) has not attended a single meeting of the Managing Committee of the Bank and, therefore, the decision of this court in case of Gujarat State Co-operative Marketing Federation Ltd. would not be applicable and ultimately, it is found by him that it would be just and proper if the detailed inquiry is held for the various loan transactions by the Bank. Therefore, the Inquiry Officer was appointed under Section 86 (1) of the Act for inquiring into the aforesaid loan transactions which were referred to in the show-cause notice. The petitioner, by draft amendment, has amended the said final order passed by the Registrar for holding the inquiry under Section 86 of the Act (Annexure 'f' ).
(2.) HEARD Mr. Joshi for the petitioner, Mr. Shukla, learned AGP for respondents no. 1 and 2 and Mr. Nikhil Vyas with Mr. Mangukiya for respondent no. 5. Other parties to the proceedings are served but they have chosen not to appear.
(3.) THE principal contention raised on behalf of the petitioner by Mr. Joshi is that if the inquiry is ordered by the very authority who is a member in the Managing Committee, the same is not permissible and, therefore, he submitted that the order for holding the inquiry under Section 86 of the Act deserves to be quashed and set aside. In support of his contention, he relied upon the decision of this court in case of Gujarat State Co-operative Marketing Federation Ltd. , Ahmedabad vs. V. H. Parekh and Anr. reported in 1995 (1)9 GCD Page 649 (Guj.) and he also alternately submitted that even after the show-cause notice, the reply was submitted but without giving proper opportunity to the petitioner, the order has been passed by the Registrar for holding inquiry under Section 86 of the Act. Mr. Joshi also incidentally submitted that when the petition was filed in the year 1987, the Managing Committee who was to face inquiry has now changed on account of subsequent election and as per his information, the respondent no. 5 and his group are in the management of the petitioner Bank. Therefore, he submitted that he has no positive instruction as to whether the petitioner Bank deserves to maintain the petition by maintaining the challenge or not. He also submitted that he had intimated to the petitioner Bank but there is no response and, therefore, he has made submissions in accordance with law.;
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