R.P. Singh, J. - (1.) The petitioners by means of this writ petition have challenged the validity of the order passed by the Registrar, Industrial Co-operative Societies, U.P. Kanpur, suspending the Committee of Management of the petitioners' society under Section 35 (2) of the IT. P. Co-operative Societies Act (Hereinafter referred to as the Act) and subsequently superseding the Committee of Management under Section 35 (1) of the Act by the order dated 12th August, 1986.
(2.) The petitioner No. 1 is a Society registered under the U.P. Cooperative Societies Act, 1985. Differences arose between the Chairman of the Committee of Management, Petitioner No. 2 and the Managing Director of the petitioners' society, respondent No. 3, wI15' alone had been authorised to operate the Bank account. The petitioner's case is that in the audit report dated 28th June, 1985, the Auditor had pointed out various irregularities and misuse of funds committed by the Managing Director of the society and in spite of the demand being made by the petitioner No. 2, Managing Director, respondent No. 3 did not submit income and expenditure statement. The Managing Director, respondent No. 3 being annoyed by the persistent demands of the petitioners to submit the accounts and since he is the officer of the Co-operative Department, exerted influence on the Registrar, Industrial Co-operative Societies, U.P., respondent No. 1 to pass an order of suspension under Section 36 (2) of the U.P. Cooperative Societies Act in a wholly arbitrary manner, without finding that the Committee of Management had made persistent default or was negligent in the performance of its duties imposed upon it.
(3.) On 14th July, 1986, learned counsel for the petitioners urged that no proceedings under sub-section (1) of Section 35 had been initiated against the petitioner and hence, no order of suspension under sub-section (2) of Section 35 of the Act could be passed. Learned Counsel for the respondent, however, submitted that the proceedings for superseding the Committee of Management under sub-section (1) of Section 45 of the Act are pending and the charge-sheet has already been given to the members of the Committee of Management, upon which this Hon'ble Court passed an order on 14-7-1986 that it appears that charge-sheet had already been given and the petitioners sought for one week's time to file a reply to the charge-sheet and subsequent to the filing of the reply, the Registrar, respondent No. 1 will complete the proceedings under sub-section (1) of Section 35 of the Act within one month and the writ petition was then ordered to be listed in August, 1986.;