The Calcutta High Court has quashed the August 6, 2002 winding-up order against Pranabananda Cooperative Bank Ltd., Burdwan, holding that the Registrar of Cooperative Societies had not followed the statutory procedure and principles of natural justice.
A Division Bench of Justice Shampa Sarkar and Justice Arjun Ray Mukherjee observed that although an inspection under Section 92 of the West Bengal Cooperative Societies Act, 1983 had been conducted, the inspection report was not shown to have been served on the appellants before the winding-up order was passed.
The Court held that reasonable opportunity of hearing was required where such action involved civil consequences.
The Court also held that RBI’s request for winding up did not dispense with the procedure prescribed under the cooperative societies law.
The winding-up order, the 2016 Tribunal order and the 2018 Single Judge order were set aside. The society may revive as a cooperative credit society, but cannot conduct banking business as a cooperative bank. The liquidator’s appointment was also set aside.
