news details |
|
|
| HC upholds supersession of CC Bank Board passed by Registrar Cooperative Societies | | | early times report
Jammu, July : 8 Justice Sunil Hali of Jammu & Kashmir High Court Jammu Wing today allowed two writ petitions filed against the order of J&K Special Tribunal and upheld the order of supersession of Board of Citizens Cooperative Bank (CCB) passed by Registrar Cooperative Societies on December 21, 2009.
The Election of Board of Directors of CC Bank was conducted on August 11, 2007 in which nine directors were declared as Directors of the Board for a period of three years. On receipt of some complaints, Registrar Cooperative Societies appointed Additional Registrar Cooperatives, Jammu to enquire into the working and management of the bank. After supplying the copy of the complaint to the management dated November 29, 2008 and after hearing them, enquiry report was submitted on January 24, 2009. The Registrar informed the MD CC Bank and sought clarification from the management of the bank through its Managing Director. The report revealed various acts of omission and commission and commission relating to the functioning of the bank particularly in the matter of recovery of loan from the defaulters.
Reply to the said report was received from the management of the Bank which was not found conclusive as the issues referred in the report were not addressed by the management of the Bank. Same was conveyed to the Management of Bank on June 9, 2009. While this report was under scrutiny, some other discrepancies were reported in the working of Bank constraining to institution one more enquiry. A committee of officials was appointed by the Registrar Cooperative Societies to enquire into new areas of concern. The enquiry report was received on December 9, 2009 which revealed that the Management of the Bank was engaged in the act detrimental to the interests of thousands of share holders and depositors of the Bank.
Consequently, a show cause notice was issued to the Bank Management seeking their response to the enquiry report filed on December 9, 2009. It was further disclosed that for the year 2007-2008 and 2008-2009 the Central Cooperative Bank has suffered net loss of Rs 158.52 lacs and Rs 287.31 lacs. The inspection reports of the bank conducted by the Reserve Bank of India for the year 2007 to 2009 revealed various defaults and acts of mismanagement. One of the deficiency found was that the credit policy framed was in violation of RBI guidelines. The said policy was by way of checklist for staff for disbursement of various kinds of loans, The Bank as classified under Grade-III as per existent RBI instructions. The inspector report of the bank conducted by the RBI for the year 2008-2009 shows that gross non-performing assets of the bank have been estimated to the tune of Rs 3382.28 lacs and during the year 2008-2009, 138 new accounts have been turned into the non-performing assets amounting to Rs 463.68 lacs.
Upon this, a show cause notice was issued to the management of the bank on December 11, 2009 and the management was asked to submit its reply within a period of seven days. The bank management is stated to have have failed to show cause within the specified period, accordingly Board of the director was superseded on December 21, 2009 which was challenged by the Bank Management before the Special Tribunal J&K. On April 5, 2010 Special Tribunal J&K set-aside the order Registrar Cooperative Societies, against that order two appeals were filed in the State High Court.
Justice Sunil Hali after hearing both sides observed that the contentions raised by the respondents that Registrar while superseding the Board was required to appoint the Administrator vide the same order, Court said that while examining this argument, it be seen that the act contemplates is that after supersession the management of the bank is to be replaced by an Administrator to run the affairs of the society (CC Bank).
The act does not contemplate that in the order of supersession, the Administrator should also be appointed. With these observations, Court allowed these petitions and set-aside the order impugned passed by the Tribunal on April 5, 2010.
The order of supersession passed by Registrar Cooperative Societies, J&K, Jammu, dated December 21, 2009 shall stand restored and the administrator appointed shall take charge of the management of the Bank forthwith, Court further ordered that election of the Management of Committee of the Citizen Cooperative Bank shall be conducted within four months from the date of this order. This Judgment today announced by Justice Ghulam Hasnain Massodi on behalf of Justice Sunil Hali. --JNF
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| |
|
|
|
|
 |
|
|
|
|
STOCK UPDATE |
|
|
 |
| BSE
Sensex |
 |
| NSE
Nifty |
|
|
| |
CRICKET UPDATE |
|
|
|
|
| |
| |
|
|
| |
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
