In a major action against alleged financial mismanagement in the cooperative sector, the Central Registrar of Cooperative Societies (CRCS) has ordered the winding up of the Steel Authority of India Employees’ Co-operative Credit Society Ltd. (SAIL Employees’ Credit Society) and appointed a liquidator to take charge of its assets and affairs.
The order, issued under Section 86 of the Multi-State Cooperative Societies Act, 2002, follows a series of complaints from members regarding non-payment of matured deposits, governance failures, unauthorized investments, and serious financial irregularities.
The decision comes in compliance with a May 19, 2026 order of the Delhi High Court, which directed the Central Registrar to wind up the society and appoint a liquidator by June 15, 2026.
According to the Registrar’s order, inspections and inquiries conducted by multiple agencies revealed widespread violations of cooperative laws. A report submitted by the Registrar of Cooperative Societies, West Bengal, highlighted illegal membership admissions, risky and unauthorized investments, suspicious banking practices, and election-related irregularities.
Despite repeated directions from authorities, including orders from the Cooperative Ombudsman to repay depositors along with interest, the society failed to refund matured deposits. Subsequent inquiries found severe liquidity stress and governance concerns.
A forensic audit conducted by DK Chhajer & Co. reportedly uncovered significant financial and compliance irregularities, estimating the society’s net deficit at approximately Rs 364.84 crore. The audit also pointed to persistent governance failures and substantial financial losses.
Investigators further flagged unauthorized schemes, violations of the Multi-State Cooperative Societies Act, excess borrowing, speculative investments, and dividend payments allegedly made out of capital. The inquiry report also cited the long-standing dominance of former chairman Jyotirmoy Chakraborty in the society’s affairs.
Acting on the High Court’s directions, Central Registrar Anand Kumar Jha has appointed the Cooperative Development Officer, Cooperation Directorate, Kolkata Range, West Bengal, as liquidator under Section 89 of the Act.
The liquidator has been tasked with taking possession of all assets of the society, including bank accounts, movable and immovable properties, investments, fixed deposits, and mutual funds.
The liquidation process is to be completed within six months, with quarterly progress reports to be submitted to the Central Registrar.