W.P.Nos.17766 of 2020, 4099 of 2021 W.M.P.Nos.22025 of 2020, 4673, 4677, 4678 of 2021

&

B.PUGALENDHI, J.

The Government Telecommunications Employees’

Co-operative Society [hereinafter referred to as

‘Society’] is a Society registered under the Multi State Co-operative Societies Act, 2002 and formed for the welfare of the Government Telecommunication Employees. The Society has purchased lands to an extent of 95.55 acres at Vellanur Village, Thiruvallur District, Tamil Nadu, during the years 2004 and 2005, for a total consideration of Rs.15.97 Crores, by availing loan from ICICI Bank, for the purpose of formation of house sites for the members of the Society. Out of this 95.55 acres of land, around 7 acres of land were acquired by the Highways Department under the land acquisition proceedings and the remaining 88.55 acres are with the Society.

2. According to the Society, the then Special Officer, in the year 2004-05, without verifying the nature and liability of the lands, has purchased the lands, which ought not to have been purchased. Even after purchasing the lands, the then Special Officer failed to manage the same. After assumption of the new management in the year 2009, the Society has regularized the lands by taking possession, updating the revenue records, removing the unauthorized occupants and cleared the taxes. Since the lands are not fit for anything, in the interest of the members, they have passed a resolution to sell the lands and accordingly, 14.58 acres of land were sold. The above transaction was questioned by the rival group, without even taking note of the real facts. Therefore, the Society has filed the writ petition in W.P.No.17766 of

2020 seeking a Mandamus to appoint a Receiver / Overseer / Advocate Commissioner to sell the properties to an extent of 73.47 acres situated in Vellanur Village, Avadi Taluk, Thiruvallur District and to deposit the sale proceeds in the account of the Society.

3. One Babu, a member of the Society, complainingthat the lands, which have been purchased for the purpose of providing housing plots to the members of the Society, have been misused by the Board of Directors, has sent several representations to the authorities concerned and alleging inaction on their part, he has filed the writ petition in W.P.No.4099 of 2021 to initiate action against the persons responsible for mismanaging the affairs of the Society and for conducting the affairs of the Society in a manner detrimental to and prejudicial to the interest of it’s members. He has also filed a petition in W.M.P.No.4678 of 2021 to constitute a Committee to inquire into the working, finances and activities of the Society from the year 2010 to till date.
4. Learned Counsel for the petitioner in W.P.No.4099 of 2021 submitted that a large scale fraud has been committed by the Board Members of the Society and demonstrated the manner in which the fraud has been committed as under:

4.1. The Board of Directors of the Society have executed a sale deed in favour of one M/s.OTCO International Limited on 20.12.2017 in respect of 10.32 acres for a sale consideration of Rs.10,93,40,906/- and in respect of 4.26 acres for a sale consideration of Rs.4,51,34,909/-, totalling Rs.15,44,75,815/-.

4.2. The said M/s.OTCO International Limited, on the very same day, executed a sale deed in respect of the 10.32 acres of land in favour of one M/s.Jesus Ministries for a sale consideration of

Rs.25,78,91,640/-.

4.3. In fact, the said M/s.Jesus Ministries has passed a resolution on 18.12.2017 itself for the purchase of the lands, much prior to the purchase of lands by M/s.OTCO International Limited on 20.12.2017.

4.4. The Board of Directors of the Society have appointed one Mr.R.Subrahmaniya Sivam, Proprietor of Subrahmaniya & Co., as Auditor for the Society, by replacing with the existing Auditor. The newly appointed Auditor, Mr.R.Subrahmaniya Sivam, is a Director and Chairman of M/s.OTCO International Limited, to whom, the Society has sold the lands. The replacement of Auditor took place in the year 2015-16 and the sale was effected in the year 2017.

4.5. The Board of Directors have so far sold 14.58 acres of land for a consideration of Rs.15,44,75,815/-, but, the market value of the property is much more than that. In fact, the Board has sold an extent of 10.32 acres of lands to M/s.OTCO for Rs.10,93,40,906/-, who, in turn, has reconveyed this portion of land immediately to M/s.Jesus Ministries for

Rs.25,78,91,640/-, about 150%, which itself shows that for a much lesser value the Society’s lands were sold.

4.6. The term of office of the Board of Directors was for a period of five years, ie., from May 2014 to May 2019. Even though the term of office expired in May 2019, no fresh election has been conducted so far. Now a notice has been issued in the newspapers that the Society is intending to sell 69.35 acres of land at Vellanur Village, Thiruvallur District. Without any authority to hold the office, this notice was published by the Board of Directors.

4. The entire stretch of 88.55 acres (excluding the 7 acres acquired by the Highways Department) is for the benefit of the members of the Society in order to provide housing facilities to them. The Board of Directors, who owe a duty to the members and had an obligation to protect the interests of the Society and its members, abused their position and acted in a manner detrimental to and prejudicial to the interest of the Society and its members.
5. However, learned Senior Counsel for the Society – petitioner in W.P.No.17766 of 2020 disputed the submissions made by the petitioner in W.P.No.4099 of 2011 and submitted that one Mr.C.T.Mohan, Advocate, who has already conducted two elections for the Society, was appointed as Election / Returning Officer on 14.03.2019 to conduct the election. But due to some practical difficulties and the lucrative VRS Scheme2019 announced by the Union Government, which paved the way for around 4000 members to show their inclination to opt for VRS and got relieved from BSNL w.e.f.

31.01.2020, the election could not be conducted as planned. Therefore, the term of office of the present Board was extended. He further submitted that the lands were purchased by the then Special Officer without verifying its nature and liability and therefore, in the interest of the Society and its members, a resolution was passed to sell the lands. With regard to selling the lands for much lesser value, the learned Senior Counsel stoutly refuted the same.

6. After some arguments, learned Counsel for the petitioner in both the petitions requested to appoint a Committee headed by a retired Judge of this Court to probe into the financial activities of the Society from the year 2001 and have also agreed for certain terms. Hence, upon the consent of both the petitioners, this Court is passing the following order:

• A Committee is formed under the chairmanship of Hon’ble Thiru Justice

S.RAJESWARAN, retired Judge of this Court.

• The Chairman of the Committee shall utilize the services of any Auditor / Advocate / Firm and / or any other person, to assist him.
• The remuneration to the Chairman is fixed as Rs.2,00,000/-. The Chairman shall fix the remuneration to the Auditor / Advocate / Firm and / or any other person, whose services were utilized by him. The Society, as agreed, shall pay the remuneration to the Chairman and to the Auditor / Advocate / Firm and / or any other person, who was appointed by the Chairman to assist him.
• A dedicated mobile number and an e-mail ID shall be opened exclusively for the Committee.
• The Society is directed to disclose the details of all the deposits, investments, bank accounts, contributions, disbursements, etc., to the Committee.
• The members of the Society, both serving as well as retired, are at liberty to submit individual / collective representations before the Committee.
• The Committee shall inquire and give its report on
  1. the financial activities / decisions of the Board / Representative General Body of the Society leading to

• the purchase of the lands in question, ie., 95.55 acres at Vellanur Village,

Tiruvallur District, Tamil Nadu;

• the sale / disposal of the lands, ie., nearly 14.58 acres of land on and from the 95.55 acres purchased at Vellanur Village,

Tiruvallur District, Tamil Nadu;

• the execution of documents and matters related thereto, including the sale

considerations, etc;

88. the housing scheme floated by the Society during 2012-2013 in respect of 88.55 acres of land (after acquisition proceedings) for the benefit of its members;

• the working, finances and activities

of the Society from 2001 to till date;

1. the transactions carried out by the Society through its bank accounts from 2001 to till date and its legitimacy; and
2. the contributions made by the members of the Society in the name and style of Family Welfare Fund, Thrift Fund, etc., and the disbursements made by the Society to its members from 2001 to till date.

The Society and its members are expected to extend their fullest co-operation to the Committee.

7. M.P.No.4678 of 2021 stands ordered in the above terms. List the main writ petitions in the first week of January, 2022. The Committee shall file its report by then. The interim order of injunction already granted shall continue.
8. It is represented that the term of office of the present Board expired in the year 2019 and that now, they are in the extended period. Be that as it may, it is made clear that nothing in this order prevents the conduct of any election to the Society, in accordance with law.

24.09.2021

mrm/gk

Index   : Yes/No

Internet: Yes

B.PUGALENDHI,J.

mrm

 

W.P.Nos.17766 of 2020, 4099 of 2021

24.09.2021