'No need for preliminary inspection to find irregularities in Cooperative society', says High Court

KOCHI: The High Court Full Bench ruled that the Registrar or Joint Registrar need not conduct a direct preliminary inspection of the cooperative society to investigate irregularities. The court clarified that a detailed investigation can be ordered if necessary after examining the inspection report of the subordinate officer and the relevant documents. The verdict was given by a bench comprising Justice V. Raja Vijayaraghavan, Justice C. Jayachandran and Justice C. Pradeepkumar.

The High Court Division Bench had earlier directed that an investigation under Section 65 of the Cooperatives Act should be ordered only after the Registrar or Joint Registrar conducts a direct preliminary inspection. However, another bench ruled that a detailed inspection can be ordered without a preliminary inspection. With two division benches taking different positions, the Chief Justice referred the case to a three-judge bench to resolve the legal stalemate.

The government explained that there are thousands of cooperative societies in the state, and it would be impractical to require a preliminary inspection for all. There is no need for a preliminary inspection to assess irregularities. Reports and documents are sufficient to give clarity on possible foul play. The full bench also directed that the cases pending in the courts be disposed of under this judgment.