1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY, AURANGABAD BENCH, AURANGABAD CRIMINAL WRIT PETITION NO.543 OF 2008 Baliram s/o Keshav Mali & others ... PETITIONERS VERSUS The State of Maharashtra & oth ... RESPONDENTS ..... Shri B.R. Warma, Advocate for the petitioners Shri K.B. Choudhari, A.P.P. for respondent Nos.1 to 5 & 7 Shri N.R. Bhavar, Advocate for respondent No.6. ..... CORAM : NARESH H. PATIL AND SHRIHARI P. DAVARE, JJ. DATED : 24TH AUGUST, 2009. ORAL ORDER : 1. The petitioners are some of the Directors out of 21 Directors, questioning the power of the Home Ministry to issue Circular dated 14.1.2008 (Exhibit I annexed to this petition) and directions issued by the Commissioner, Cooperative, State of Maharashtra, dated 11.8.2008 (Exhibit E). 2 2. In the submissions of learned counsel Shri Warma, the Home Ministry has no power to issue such circular much less when the Maharashtra Cooperative Societies Act, 1960 (hereinafter referred to as the Act of 1960 for short) and Rules made thereunder provide adequate machinery to meet the situation of the present nature. The Commissioner, according to counsel, even is not entitled to issue directions to the Chartered Accountant or any other subordinate officer to lodge First Information Report/ complaint to police regarding the alleged misappropriation, fraud in disbursement of amount of Crores of rupees. The counsel has placed reliance on reported judgment in 1965 (1) Cri.L.J. 100 (Vol. 70 C.N. 38) Nilratan Sircar, Appellant Vs. Lakshmi Narayan Ram Niwas, Respondent) in support of the submissions. It was submitted that the Home Ministry circular encroaches upon the powers of the other Department i.e. Cooperative Department of the Government of Maharashtra. 3. On behalf of respondent No.2, the Commissioner Mr. Krishna Balbhimrao Lavekar has himself filed affidavit-in-reply. From the reply, we gather that the audit report of financial year 2006-2007 of the society was conducted. The management of the society was superseded by an order dated 25.6.2009 in exercise of powers under Section 78 of the Act of 1960 and the 3 Administrator had already taken charge of the affairs of the society. The deponent further submits that, enquiry under Section 88 of the Act of 1960 was completed and recovery certificate under Section 98 is issued for recovery of huge amount of Rs.162 Crores from Board of management for misfeasance, misappropriation and fraudulent disbursement. The Commissioner, in the facts of the case and finding of the auditor’s report, has referred to the circular issued by the Government in Home Department, by Principal Secretary (Special) directing Police Department to lodge criminal complaint if fraudulent disbursement or misappropriation or insufficient mortgage while disbursing the loan is noticed at the time of auditing. The circular provides protection to Special Recovery Officer at the time of recovery of loan of defaulters. 4. Certainly we find that the amount involved, according to the audit report allegedly the misappropriated or fraudulently dealt with is huge amount of Rs.162 Crores which is a matter of serious concern. The societies like urban cooperative credit society are institutions of trust and they shall be conducted in absolute adherence to the provisions of law and with complete transparency and honesty. 4 5. From the affidavit-in-reply filed by the Commissioner, prima facie we notice that the State authorities had to take over the administration of the society by passing appropriate orders and issue recovery certificates under Section 98 for recovery of an amount of Rs.162 Crores from the Board of management. 6. It was brought to our notice by learned counsel Shri Warma that earlier Criminal Writ Petition No.561/2009 was filed by some of the Directors blaming other Directors for their alleged involvement in illegal disbursement of amount of loan which petition was dismissed by this Court by an order dated 3.8.2009. In proceedings of this petition, we would not entertain a plea or address the issue as to which of the Director was responsible for any alleged act of misappropriation or fraudulent disbursement of the amount. 7. Considering the overall scenario of the functioning of the credit societies, the Home Department had issued directions to police. After going through the circular, we do not find any illegality in the State issuing such circular. Obviously the Cooperative Department had already initiated proceedings and reached conclusion of fixing responsibility by issuing recovery certificate under Section 98 of the Act of 1960 against the Board 5 of management. In the light of these facts and development in the matter, we find that the Government authorities i.e., the Cooperative and the Home, have acted in the interest of depositors and existence of the credit societies. While exercising writ jurisdiction of this Court, we do not find that the petitioners have made out any case for causing interference by this Court. The judgment cited before us is not applicable in view of the facts of this case. The petition stands dismissed. The registry to communicate the writ to respondent No.7 forthwith. 8. Learned Counsel Shri Warma for the petitioners at this stage submits that the petitioners’ appeal filed under the provisions of Maharashtra Cooperative Societies Act is pending before the State Government. The said appeal will be decided on merits independently in accordance with law. (SHRIHARI P. DAVARE, J.) (NARESH H. PATIL, J.) fmp/cwp543.08