Court Rules Registrar Cannot Curtail Society's Powers Under Rajasthan Cooperative Societies Act, 2001; Allows Petitioners to Continue in Service with Benefits
In a significant judgment delivered on September 15, 2026, the Rajasthan High Court, Jaipur Bench, reinforced the autonomy granted to short-term cooperative credit structure societies under the Rajasthan Cooperative Societies Act, 2001, particularly in matters of staffing, recruitment, and internal administration. The Court quashed the orders passed by the Additional Registrar of Cooperative Societies which had stayed the resolutions regularising the services of employees in the Central Cooperative Bank, Sawaimadhopur, and directed their termination pending tribunal proceedings.
The matter arose when Pooran Singh Meena and Dilip Singh Shekhawat, employees working on contract basis with the Central Cooperative Bank, had their services regularised through resolutions passed by the society and approved by its Board. Despite this, the Additional Registrar invoked Section 125(1) of the Rajasthan Cooperative Societies Act, 2001 to stay the resolutions and directed their rescission, leading to cancellation of appointments. The petitioners challenged these orders through writ petitions.
Justice Anand Sharma, while delivering the judgment, relied on a prior Division Bench decision in Tej Singh vs. Hanumangarh Central Co-operative Bank Ltd. (2013), which clarified the scope of Sections 30B and 125 of the Act. Section 30B explicitly grants cooperative societies autonomy over financial and internal administrative matters, including personal policy, staffing, recruitment, and posting. Conversely, Section 125 allows the Registrar to rescind resolutions only if they are prejudicial to the society's interests but contains a proviso that prohibits any action that would curtail or undermine the society's autonomy.
The Court emphasized that the Additional Registrar's interference in the regularisation process was impermissible as it contravened the statutory autonomy of the cooperative society. The judgment underscored that the Registrar's powers under Section 125 cannot be exercised in a manner that adversely affects the provisions of autonomy granted under Section 30B.
Consequently, the Court quashed and set aside the impugned orders dated August 25, 2015, and September 1, 2015, which stayed the resolutions and cancelled the appointments. The petitioners were permitted to continue in service with all consequential benefits. The Court further clarified that their services cannot be terminated except in accordance with the law.
This judgment reaffirms the principle that cooperative societies enjoy significant independence in managing their internal affairs, especially staffing matters, and external authorities like the Registrar must exercise caution not to overreach their powers.
Bottom Line:
Rajasthan Cooperative Societies Act, 2001 - Short term co-operative credit structure society has autonomy in staffing, recruitment and internal administrative matters under Section 30B - Registrar cannot invoke Section 125 so as to curtail or undermine such autonomy - Orders staying and cancelling resolution regularising petitioners' services and consequential termination orders were quashed.
Statutory provision(s):
Rajasthan Cooperative Societies Act, 2001 - Sections 30B, 125
Pooran Singh Meena v. State of Rajasthan, (Rajasthan)(Jaipur Bench) : Law Finder Doc Id # 2983491
