1 wp 4830.11 IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD WRIT PETITION NO. 4830 OF 2011 Rajjak Khan Gani Khan and others .. Petitioners Versus The Divisional Joint Registrar, Co-op. Societies, Nashik and others .. Respondents Shri V. D. Hon, Advocate for Petitioners. Shri R. P. Phatake, A.G.P. for the Respondent/State. Shri R. N. Dhorde, Advocate for the Respondent No. 4. CORAM : S. V. GANGAPURWALA, J. DATE : 06TH JULY, 2011. PER COURT : . The petitioners are the members of the managing committee of Mahaveer Urban Co-operative Society Limited. The proceedings U/Sec. 78 of the Maharashtra Co-operative Societies Act were initiated against the petitioners. The respondent No. 2 vide its order dated 20 th June 2011 passed an order U/Sec. 78(1) of the said Act dissolving the managing committee. Aggrieved thereby the petitioners preferred an appeal before the respondent No. 1. Along with the appeal they have also filed an application 2 wp 4830.11 for stay of the order passed by the respondent No. 2. The respondent No. 1 vide its order dated 30.06.2011 rejected the application for stay. Aggrieved thereby the present writ petition is filed. 2. During the intervening period i. e. since the inception of proceedings U/Sec. 78 till the passing of impugned order and till today the petitioners are protected by the orders of this Court. 3. Shri Hon, the learned counsel for petitioners submits that the appeal is required to be heard on merits. Till the appeal is heard on merits, the petitioners deserve to be protected. The proceedings are initiated on the basis of the acts of commissions and omissions on the part of the previous body. The learned counsel further contended that the authority himself has observed that the records and proceedings can be verified in detail at the time of consideration of the appeal on its own merits. If the order of the respondent No. 2 is not stayed the appeal itself would become infructuous and the very purpose of filing appeal would stand frustrated. The learned counsel further contended that the petitioners are not doing any acts which would be detrimental to the interest of the respondents. 3 wp 4830.11 Shri Hon, the learned counsel on instructions of petitioners states that petitioners would undertake to deposit Rs. 50,00,000/- (Rs. Fifty Lakh only) with the respondent No. 4 to show their bonafides by end of this month. 4. Shri Dhorde, the learned counsel for the respondent No. 4 submits that the petitioners are guilty of acts of commissions and omissions. Their acts are prejudicial to the interest of respondent No. 4. More than Rs. 17 corers is outstanding against the society. It was also agreed by the said society that 80% of payment from the recovery would be made to the respondent No. 4/Bank still they have miserably failed to pay the amount. It is only after this Court passed the orders, the petitioners deposited an amount of Rs. 2,20,00,000/- (Rs. Two corer Twenty Lakhs only). A loan of Rs. 8,00,00,000/- corers was taken in the year 2003. The amounts are being paid to other persons. The respondent No. 2 while passing the order U/Sec. 78(1) of the Act has taken into consideration various aspects of the case including the fact that the work of the petitioner is against the interest of the society itself, so also the respondent bank. 5. The learned counsel further contends that to avoid further 4 wp 4830.11 losses and to protect the interest of the respondent respondent Bank and Society, an administrator is necessary and must. The petitioners do not have any right to be in the office for their gross acts of commission and omissions. In the alternate Shri Dhorde, the learned counsel states that if at all this Court comes to the conclusion to grant stay, then the petitioners should be directed to deposit an amount of Rs. Seven Corers instantly. 6. It is a fact that vide various orders passed by this Court, the petitioners are protected and the orders adverse to the interest of the petitioners were not to take effect for a particular period, till today the said protection is in force. The matter involves legal and factual issues to be dealt with by the Appellate Authority. The statutory appeal is still pending. The authority has observed as under : “However, during the pendency of this appeal details can be verified and after verification of records and proceedings, necessary and appropriate orders would be passed according to the provisions of the M. C. S. Act, 1960 and especially on its own merits” 5 wp 4830.11 7. As such, it would be clear that various documents i. e. records and proceedings are required to be verified by the Appellate Authority at the time of final disposal of the appeal. In case the order passed by the respondent No. 2 U/Sec. 78(1) of the Maharashtra Co-operative Societies Act is not stayed, then the petitioners would be out of the office and in effect the very purpose of filing of appeal would stand frustrated. At the same time, the interest of the respondent No. 4, creditor is required to be safeguarded. 8. In the result I pass the following order. 1. The order passed by the respondent No. 2 dated 20.06.2011 is stayed on following conditions. a) The petitioners shall deposit an amount of Rs. 50,00,000/- (Rs. Fifty Lakh only) by end of July 2011. b) The petitioners shall further deposit an amount of Rs. 50,00,000/- (Rs. Fifty Lakh only) by 15 th August, 2011. c) The petitioners shall not dispose off/deal with 6 wp 4830.11 the assets of the society i. e. Mahaveer Urban Co- operative Credit Society till the disposal of the appeal. d) From the recoveries made, the petitioners shall deposit 80% of the amount with the respondent No. 4. e) The deposit of Rs. 50,00,000/- (Rs. Fifty Lakh only) by end of July 2011 and deposit of further Rs. 50,00,000/- (Rs. Fifty Lakh only) by 15 th August, 2011 is condition precedent for grant of/stay of the present order. f) The respondent No. 1 before whom the appeal is pending shall dispose of the appeal expeditiously preferably within a period of three months from today. g) The writ petition is disposed of. 9. Shri Hon, the learned counsel prays that in the event some adverse orders are passed against the petitioners in appeal, the 7 wp 4830.11 petitioners be protected for further period of two weeks from the service of order. Liberty is granted to make such a request on compliance of the orders passed by this Court in the present writ petition. [ S. V. GANGAPURWALA, J. ] bsb/July 11