High Court upholds TN's amendment allowing cooperative society registrars to initiate suspension

A divisional bench of the Madras High Court comprise Justice T.S.Sivagnanam and Justice Sathi Kumar Sukumara Kurup had dismissed a petition which sought directions to the TN Government to scrap the amendment.

The petition was moved before the bench by Perambur based Cooperative Building Society’s president Krishnamoorthy who through his counsel PH Arvind Pandian and S.P.Shanmugapandian that the amendment which had been made in Tamil Nadu Cooperative Societies Act 1983 is allowing registrars to suspend the elected presidents and vice presidents should be scrapped.

Government Pleader P Muthukumar who appeared for the Tamil Nadu Cooperative Societies Department stated that the amendment was made only for the wellness of the cooperative societies to prevent the misappropriation, breach of trust by the elected heads in the cooperative societies.

After hearing the submissions, the bench ruled that the amendment was passed to protect the cooperative societies.

If there is prima facie misappropriation or breach of trust or gross mismanagement of the affairs of the registered society or committed any offence involving criminal misconduct or moral turpitude by the President and Vice President of registered cooperative societies, action can be taken by the registrar as per the rules amended in Tamil Nadu Cooperative Societies (Amendment) Act 2020, the judges observed.

The MHC dismissed the writ filed by the petitioner.

In February 2020, Tamil Nadu Legislative Assembly brought the amendment in the Tamil Nadu Cooperative Societies Act 1983.

“The President of the Vice-President of a registered society has committed or has been otherwise responsible for the misappropriation or breach of trust or gross mismanagement of the affairs of the registered society or committed any offence involving criminal misconduct or moral turpitude and if in the opinion of the Registrar, there is a prima facie evidence against the President or the Vice-President and the suspension of the President or the Vice-President is necessary for the interest of such society or in the public interest, the Registrar may, by order, place the President or the Vice-President, under suspension,” said in the new amendment.