Common Order

1. Since a common issue is involved in these Writ Petitions, they were taken up and heard together and are being disposed of by this common and consolidated order.

2. These Writ Petitions are filed challenging the action of the Deputy Registrar/District Co-operative Officer, Karimnagar, and the Special Category Deputy Registrar of Co-operative Societies, respectively, in initiating surcharge proceedings against the petitioners herein and subsequently passing the surcharge orders dated 18.07.2023 and 14.08.2023, respectively, under Section 60 of the Telangana Cooperative Societies Act, 1964, (for short, “the Act”), without having any jurisdiction and contrary to the orders of respondent No.1 in G.O.Ms.No.10, Agriculture and Cooperation (Coop.II) Department, dated 30.01.2017, as illegal and arbitrary and consequently to set aside the same and to pass such other order or orders.

3. Heard learned counsel for the petitioners and learned Government Pleader for Cooperation.

4. The petitioners in W.P.No.39165 of 2025 were the employees of respondent No.5-society and the petitioner in W.P.No.608 of 2026 was the Chief Executive Officer of respondent No.4-soicety. Respondent No.5-society in W.P.No.39165 of 2025 is a Large Sized Cooperative Society and respondent No.4-society in W.P.No.608 of 2026 is a Primary Agricultural Cooperative Society.

5. Learned counsel for the petitioners submitted that vide G.O.Ms.No.10 dated 30.01.2017, powers of the Registrar under various provisions of the Act were delegated to departmental authorities in view of reorganization of new districts. It is submitted that in respect of Primary Agricultural Cooperative Societies, the powers of the Registrar only under sub-section (1) of Section 116-C of the Act, subject to guidelines issued by the Registrar of Cooperative Societies, were delegated. It is further submitted that subsequently, when action was sought to be taken under G.O.Ms.No.10, the same was challenged by similarly placed in W.P.No.38595 of 2022, and this Court had granted interim relief by order dated 17.10.2022. Thereafter, in W.Ps.No.13532 and 15470 of 2024, this Court had passed final orders holding that G.O.Ms.No.10 did not delegate the powers of the Registrar to the Cooperative Departmental Officials to take action under the Act except for Section 116-C of the Act. It was also observed therein that the respondents admitted that a typographical error has occurred in G.O.Ms.NO.10 dated 30.01.2017 and in order to rectify the same, the Government has issued G.O.Ms.No.1 dated 10.01.2024 conferring powers on the Deputy Registrar of Cooperative Societies/Special Cadre Deputy Registrars/Joint Registrar, to conduct inquiry into the affairs of the PACS. It was further observed that for the period from 30.01.2017 to 10.01.2024, the Government has not delegated any powers to the Special Cadre Deputy Registrars for conducting inquiry into the affairs of the PACS. It is further submitted that in a similar matter, i.e., in W.A.No.622 of 2023, filed challenging the order dated 08.06.2023 in W.P.No.24514 of 2022 passed by the learned Single Judge, the Division Bench of this Court held that the Deputy Registrar had no powers to initiate such action i.e., initiating proceedings under Section 21-AA(1)(b) of the Act against the appellant therein. However, liberty was granted to the Registrar of the Cooperative Societies to initiate proceedings against the appellant therein under Section 21-AA (1)(b) of the Act.

6. Learned counsel for the petitioners submitted that under Section 115-C (a) of the Act, the Cooperative Credit Society is defined as the Telangana State Cooperative Bank, District Cooperative Central Bank and the Primary Agricultural Cooperative Credit Society (PACS). A Primary Agricultural Cooperative Credit Society includes a Farmers Service Cooperative Society, Cooperative Rural Bank, Large Sized Cooperative Society. Therefore, the judgments rendered in respect of PACS are also applicable to the petitioners in W.P.No.39165 of 2025. Therefore, according to him, the impugned surcharge orders passed under Section 60 of the Act are without jurisdiction and are liable to be set aside.

7. Having regard to the rival contentions and the material on record, this Court finds that the surcharge notices were issued on 30.09.2020 and 17.05.2023 and the surcharge orders were passed on 18.07.2023 and 14.08.2023 respectively. Admittedly, these orders fall within the period between 30.01.2017 and 10.01.2024, during which period, the concerned authorities did not have the requisite jurisdiction to initiate surcharge proceedings. In view of the same, the action of respondents in issuing the impugned surcharge orders is without jurisdiction and therefore, the impugned surcharge orders are liable to be set aside. Accordingly, the impugned surcharge order dated 18.07.2023 in W.P.No.39165 of 2025 issued by respondent No.3-the Deputy Registrar of Cooperative Societies/District Cooperative Officer, Karimnagar and the impugned surcharge order dated 14.08.2023 in W.P.No.608 of 2026 issued by respondent No.3-the Special Category Deputy Registrar of Cooperative Societies/District Cooperative Officer, Jagtial District, are hereby set aside.

8. However, liberty is granted to the Registrar of Cooperative Societies to initiate action against the petitioners in accordance with law.

9. Both the writ petitions are accordingly disposed of. There shall be no order as to costs.

10. Pending miscellaneous petitions, if any, in these Writ Petitions shall stand closed.