Karnataka’s Bangalore-based Soundarya Souharda Credit Co-operative Society has come under scrutiny following a complaint alleging financial irregularities and misuse of funds. However, Chairman P. Manjappa has categorically rejected the charges, calling them false, fabricated, and politically motivated.
“These allegations are completely baseless. Certain individuals are unable to tolerate the consistent growth and stability of the society over the last many years,” Manjappa said.
Talking to Indian Cooperative, he emphasised that Soundarya is a Souharda Credit Co-operative Society operating strictly under the Karnataka State Souharda Sahakari Act. “All depositors’ money is absolutely safe. The society has reserves and surplus exceeding Rs 70 crore, and we declared a 15 per cent dividend to members in the last financial year,” he added.
Manjappa acknowledged that cooperative authorities had pointed out procedural lapses but denied any financial wrongdoing. “We have accepted all observations and sought time till March to complete rectifications. There is no misuse of funds,” he said.
On personal borrowings, the chairman stated that all loans were fully secured and adequately collateralised. “I have mortgaged properties worth over Rs 100 crore. I have been in business since 1980, running hotels, schools, educational institutions, and a law college. My personal net worth is transparent and well documented,” he said.
He alleged a politically driven conspiracy following his son Keerthan Kumar’s entry into electoral politics. “This is a deliberate attempt by a few planted members and local rivals to tarnish my image and the reputation of the society. All board members, including family members, were democratically elected,” he said.
The society’s financial performance, he added, reflects strong member confidence. “Our total business stands at around Rs 260 crore, with a net profit of nearly Rs 3 crore in 2024-25. There is no run on the society because members trust our services and leadership,” he said.
It bears recalling that the complaint, filed by society member Shankaregouda, alleges that loans were repeatedly sanctioned against the same property without repayment and that family members availed loans worth Rs 42 crore, accounting for 23% of the society’s loan portfolio. Vice-President Sunitha, the chairman’s wife, is also alleged to have obtained multiple loans against the same collateral.
The matter has now been escalated to the Bengaluru Police Commissioner following findings by the Joint Registrar of Co-operative Societies, drawing renewed attention to governance practices within Souharda credit cooperatives in Karnataka.
There is also a misunderstanding in media reports suggesting that Soundarya Souharda is a bank, whereas it is actually a credit cooperative. Therefore, state cooperative laws, particularly the Souharda Acts, apply here, not the regulations of the RBI.