Non-Joinder of a Necessary Party in Cooperative Society Disputes Vitiates Appellate Proceedings, Warranting Remand for Fresh Adjudication

The Petitioner, former President of Seva Sahkari Samiti Maryadit, Korbi, challenged the supersession of the Society’s Board by the Deputy Registrar (Respondent No. 5) following allegations of financial embezzlement and a subsequent FIR under Sections 420, 409, and 120B of the IPC

Initially, the First Appeal was dismissed on limitation, but the Cooperative Tribunal remanded the matter for a decision on merits

On 29-10-2024, the Joint Registrar (Respondent No. 4) allowed the appeal and set aside the supersession order

Respondent No. 5 subsequently appointed Respondent No. 6 as the Authorized Officer to manage the Society

Respondent No. 6 then appealed the Joint Registrar's order before the Tribunal. On 03-01-2025, the Tribunal set aside the Joint Registrar’s order and remanded the matter again, directing the impleadment of the Society (through its Authorized Officer) as a necessary party

1. Whether the remand order passed by the Chhattisgarh State Cooperative Tribunal, directing the impleadment of the Society as a necessary party, suffers from perversity or illegality

2. Whether the quashing of a supersession order by an appellate authority results in the automatic reinstatement of the erstwhile President without a formal order from the Registrar

Section 53 of the CG Cooperative Societies Act, 1960 regarding the supersession of a Board and Section 78 regarding appeals

Principle of Audi Alteram Partem and the necessity of impleading "necessary parties"—defined as those whose interests are directly affected by an order

Public Service Commission, Uttaranchal v. Mamta Bisht (2010), which maintains that non-joinder of a necessary party is fatal and violates principles of natural justice

J.S. Yadav v. State of UP (2011), holding that no order can be passed behind the back of an adversely affected party

The Court reasoned that the center of the dispute involves the governance and financial operations of the Seva Sahkari Samiti Maryadit; therefore, any judicial or quasi-judicial order concerning its Board directly affects the Society's legal status and administration

The Petitioner had failed to implead the Society as a legal entity before the First Appellate Authority

The Court rejected the Petitioner’s argument that impleading some Board members was sufficient, noting that once the Board was dissolved, only an Authorized Officer could legally represent the Society’s interests, especially regarding allegations of financial irregularity

Furthermore, the Court held that the Joint Registrar’s order setting aside the supersession did not ipso facto restore the Petitioner to the President's post; a formal administrative order by the Deputy Registrar was required for reinstatement

Since the Tribunal’s order was based on a technical requirement for natural justice (joinder of parties) rather than merits, it did not warrant interference under Article 226

The High Court dismissed the writ petition and affirmed the Tribunal's remand order. The First Appellate Authority (Respondent No. 4) was directed to implead the Society and other necessary parties and decide the appeal on merits within 90 days. No costs were awarded.