In a significant development, the Central Registrar of Cooperative Societies, Rabindra Kumar Agarwal, has ordered the winding up of the New Delhi-based Lustiness Janhit Credit Cooperative Society Ltd., citing serious lapses in regulatory compliance and multiple complaints of non-repayment of deposits.
The society, registered under the Multi-State Cooperative Societies (MSCS) Act, 2002 was found non-functional at its registered address during a physical verification. It had failed to submit its mandatory annual returns and had ignored repeated communications from the Central Registrar’s office regarding depositor complaints.
A complaint filed by Satyendra Chaturvedi from Madhya Pradesh set the process in motion. The Central Registrar directed the Delhi Registrar of Cooperative Societies to conduct an inspection under Section 108 of the MSCS Act. The society failed to respond to this directive.
Subsequently, the High Court of Madhya Pradesh, responding to three separate writ petitions, ordered the Central Registrar to consider the grievances of depositors. Even though the Registrar issued formal orders for remedial action on February 11, 2025, these were returned undelivered.
With no objections received to a final winding-up notice issued on March 10, 2025, the Central Registrar invoked Section 86 of the MSCS Act to formally order the winding up of the society. The Deputy Commissioner/District Magistrate of South West Delhi has been appointed as liquidator under Section 89(1) of the Act, with instructions to submit quarterly progress reports on the liquidation.
This case is the latest in a growing list of actions against multi-state credit cooperative societies, many of which face similar allegations. Recent winding-up orders have been issued against Loni Urban Multi-State Credit and Thrift Cooperative Society Ltd. in Uttar Pradesh, Wagar Credit Cooperative Society in Rajasthan, Welcome India Credit Cooperative Society in Jodhpur, Amardeep Credit Cooperative Society in Rajasthan, and Dryararadha Multi-State Cooperative Society in Maharashtra.
These societies were found in violation of operational norms, with common issues including non-functional offices, non-submission of returns, unauthorized expansion, and persistent failure to repay depositors.
The rising number of such cases has raised alarm over regulatory oversight and the protection of public funds in the cooperative sector.
