In a decisive move signalling tighter oversight in the cooperative sector, the Office of the Cooperative Ombudsman under the Ministry of Cooperation has directed BK Dhanalakshmi Multi State Agri Coop. Society Ltd. to refund deposits to multiple complainants, citing serious lapses in its functioning and disregard for depositor grievances.
The order, issued on April 13, 2026, follows complaints from five depositors who alleged that the society failed to repay matured deposits and did not honour pre-closure requests. Despite repeated applications and follow-ups, the complainants claimed they neither received their funds nor any formal communication from the society. The Ombudsman noted that the cooperative ignored several notices issued between January and March 2026, reflecting a pattern of non-responsiveness and deviation from established cooperative principles.
Taking a strict stance, the authority has directed the society to repay all due amounts along with applicable interest within 30 days. Additionally, it has mandated the submission of a compliance report immediately after the repayment is completed. The directive underscores the growing emphasis on depositor protection and accountability within cooperative institutions, particularly those handling public funds.
The action against BK Dhanalakshmi MSCS comes amid a broader pattern of disputes reaching the Ombudsman’s office, highlighting systemic concerns in the sector. In a separate case involving a Chennai-based multi-state housing cooperative in Chennai, the Ombudsman recently flagged a potential case of fraud involving a Rs 3 lakh fixed deposit, pointing to possible criminal misconduct by one of the parties.
That case arose from a complaint filed by Arun Kasyap P.B. against Bharath Lajhna Multi State Housing Cooperative Society Ltd., where the complainant sought a refund of a deposit made in 2017. He alleged that after submitting the original Fixed Deposit Receipt (FDR) for closure in June 2025, the society neither refunded the amount nor responded to his requests.
The respondent society denied the existence of the deposit, terming the FDR “fake” and asserting that the receipt number belonged to another individual. During proceedings conducted via video conferencing, both parties submitted affidavits and stood firm on oath, each defending the authenticity of their claims. The Ombudsman, upon reviewing the records, observed that a single FDR number could not belong to two different individuals, suggesting that one party had misrepresented facts.
However, noting the limitations of its jurisdiction, the Ombudsman refrained from determining culpability and instead indicated that the matter involved elements of criminal misconduct requiring investigation by law enforcement agencies. The parties were advised to pursue appropriate legal remedies.
Together, these cases reflect a growing volume of complaints related to deposit mismanagement, documentation discrepancies, and lack of transparency in cooperative societies. Experts point out that such incidents erode trust in the cooperative framework, which is otherwise built on principles of mutual benefit and accountability.
The Ombudsman’s recent orders send a clear signal that regulatory scrutiny is intensifying and that cooperative institutions must adhere to stricter standards of governance, responsiveness, and financial integrity. With more depositors turning to formal grievance mechanisms, the spotlight is now firmly on ensuring that cooperative societies uphold the trust placed in them by their members.
