The Allahabad High Court at Lucknow on Wednesday while hearing a Bail Application took dim view of the sorry state of affairs of Cooperative Societies in India and how they have been overtaken by Anti-Social Elements.
Justice Pankaj Bhatia expressed his displeasure observing that:
Very sorry state of affairs of the State of U.P. the poor plot holders, the society members are being harassed and the State as of now has not developed any mechanism to discharge its duties which are required to protect the small and voiceless members/ plot owners who are at the mercy of the anti social elements who have unscrupulously taken control over the housing societies. This Court in discharge of its constitutional duties cannot turn a blind eye to the huge problems and illegalities of humongous proportions as highlighted above.
Background
An FIR was lodged alleging that a society registered in the name and style of Rishi Vasishth Shakari Awas Samiti Limited was restrained by the U.P. Awas Vikas Parishad, Lucknow to not to sell the property owned by the Society in view of a complaint received against the said Society. However despite there being a restraint, on the basis of the allegedly fraudulent document, a resolution came to be passed on 02.12.2016 by the Society signed by as many as six persons wherein a decision was taken for execution of lease 2 deed in respect of a land which was shown in the map of the Society as Park.
In terms of the said proposal, was alleged that a lease deed was executed in favour of two persons, namely, Subodh Chandani and Satish Chandani for a term of 33 years extendable upto 99 years on a paltry lease rent of Rs.30,000/- per year, with the purpose to open marriage lawn.
Counsels for the applicant Advocates Sanandan Kumar Misra and Anubhav Awasthi submitted that in terms of the said decision taken by the Society, a lease deed was actually executed by the Secretary of the Society, namely, Nikhil Maurya. Further, the said Nikhil Maurya named in the FIR has been enlarged on bail by High Court, thus on the ground of parity with Nikhil Maurya, the applicant is entitled to be enlarged on bail.
Ms. Shreya Chaudhary, Counsel appearing on behalf of the informant drawn the attention of this Court to the letter issued by the U.P. Awas Vikas Parishad restraining the Society from taking any steps from selling the property in view of the complaints received.
She further submitted that the alleged letter dated 06.01.2018 by means of the ban has been allegedly lifted is forged and fabricated, which stood fortified by the subsequent letter of the U.P. Awas Vikas Parishad dated 09.02.2018 wherein it was specifically mentioned that the letter dated 06.01.2018 was a forged letter
Ms. Chaudhary further submitted that these facts were not brought to the notice of the court when the Bail was granted to Nikhil Maurya as such the claim of Bail on grounds of parity merits rejection.
Very Sorry State of Affairs
Earlier the Court vide order dated 06.12.2021, had observed that huge scandals are going on in the Co-operative Housing Societies across the State of U.P. and despite there being ample powers under the U.P. Co-operative Housing Societies Act, no adequate steps are being taken and instructions were called from the Commissioner to indicate what steps are being taken to remedy the malaise.
Highlighting the haywire situation in the Cooperative Societies by observing that:
“The modus operandi of these persons is also very common and not very hard to decipher, most of the original members of the initially created society have either died or lost interest in the affairs as a result whereof new members, at times who are not even eligible, are added to gain majority stake in the society, the elections are either not held or are rigged and are decided by the majority created by the henchmen of such persons, such societies then work in an opaque manner and there is no accountability or system of checks and balances. The extent of misappropriation can not even be imagined.”
Considering above the Court has issued the following directions to the State:
- The State shall ensure the audit of account of all the Cooperative Housing Societies of the State of U.P. as required under Section 64 on yearly basis without fail. The State shall separately get the Audit of the lands owned by the Co-operative Societies to decipher whether any lands/ properties owned by the Society have been misappropriated.
- The yearly Audit reports as directed above with regard to all the Cooperative Housing Societies shall be furnished in accordance with law to an Apex body at State Level.
- Wherever any discrepancies with regard to the unauthorized sales/ unauthorized withdrawal from the account of the Societies are noticed, an FIR in question shall be lodged and steps shall be taken for recovery the loss caused to the Co-operative Housing Societies., if 8 there is any need, the Investigating Agency/State/Authorised person shall be free to take the help of Enforcement Directorate for recovering the ‘proceeds of crime’ if found to have been transferred or misappropriated either by any of its office bearers/members of the Co-operative Housing Society throughout the State of U.P.
- The State Government shall issue necessary directions for holding of the elections in accordance with law after giving wide publicity for all the Co-operative Housing Societies except the cases where any restraint orders have been passed by any competent court of law.
- If any assets have been misappropriated, needless to say that appropriate steps shall be taken for taking back the said assets.
- The State Government shall also take into consideration while deciding the holding of the election as directed above to ensure that no fictitious members were added to the Co-operative Housing Societies in an unauthorized manner/contrary to bylaws of society or any statute/rules.
- An action taking report as directed above shall be filed before this Court within a period of three months from today positively on or before 28th February, 2022. The report shall be presented before this court in a sealed covered.
- Any attempt to subvert/disobey the directions as given above shall be viewed very seriously by this Court and the responsibility of the Officer not obeying the directions of this Court shall be fixed.
