1 2026:CGHC:26229-DB NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WA No. 525 of 2026 1 - Bhuneshwar Kaushik S/o Late Tekram Kaushik Aged About 30 Years R/o Village Jinda, Post Dharampura, Jinda, Distt. Kabirdham Chhattisgarh 491995. 2 - Panch Bai Kaushik W/o Late Tekram Kaushik Aged About 49 Years R/o Village Jinda, Post Dharampura, Jinda, Distt. Kabirdham Chhattisgarh 491995 ... appellant(s) versus 1 - Chhattisgarh Rajya Sahakari Bank Mariyadit Through Its Chairman, Sahakari Bhawan, Plot No. 76, Sector 24, Naya Raipur, Distt. Raipur Chhattisgarh 2 - Registrar Cooperative Society, Block 3, Second And Third Floor, Indrawati Bhawan, Naya Raipur, District Raipur Chhattisgarh 3 - Deputy Registrar Cooperative Society, Kabirdham, District Kabirdham Chhattisgarh 4 - Chief Executive Officer Zila Sahakari Kendri Bank Mariyadit, Rajnandgaon, G.E. Road, Distt Rajnandgaon Chhattisgarh 5 - Nodal Officer Zila Sahakari Kendri Bank Mariyadit, District Kabirdham Chhattisgarh SAGRIKA AGRAWAL Digitally signed by SAGRIKA AGRAWAL Date: 2026.06.30 11:01:29 +0530 2 6 - Branch Manager Zila Sahakari Kendri Bank Mariyadit, District Kabirdham Chhattisgarh 7 - Cooperative Inspector Office Of District Registrar Cooperative Society, District Kabirdham Chhattisgarh ... Respondent(s) (cause title taken from CIS) For Appellant (s) : Mr. Aniket Verma, Advocate For Respondent No. 1 For State : Mr. Jitendra Shrivastava, Advocate Mr. N. K. Jaiswal, Dy. G.A. Hon'ble Shri Ramesh Sinha, Chief Justice Hon’ble Shri Ravindra Kumar Agrawal, Judge Order on Board Per Ramesh Sinha, Chief Justice 29.06.2026 1. Heard Mr. Aniket Verma, learned counsel for the appellants as well as Mr. Jitendra Shrivastava, learned counsel for the respondent No. 1 and Mr. N. K. Jaiswal, Dy. Govt. Advocate for the Respondent/ State. 2. This appeal has been filed by the appellants against the order dated 22/04/2026 passed by learned Single Bench of this Court in WPS No. 7194/2022 (Bhuneshwar Kaushik & Another Vs. Chhattisgarh Rajya Sahakari Bank Mariyadit & others), whereby the writ petition filed by the writ petitioner, has been dismissed. 3. The brief facts of the case are that the appellants are the legal heirs of Late Shri Tekram Kaushik, who was serving as Prabhari Samiti Prabandhak at Seva Sahakari Samiti Mariyadit, Jinda & Jhirona, District Kabirdham, and died in harness on 26.03.2020. 3 After his death, the respondent authorities conducted an ex parte enquiry against the deceased in respect of alleged financial irregularities purportedly committed during the period 2016-17 to 2019-20. Pursuant thereto, the Deputy Registrar, Cooperative Societies, Kabirdham issued a show-cause notice dated 28.09.2022 under Section 58-B(1) of the Chhattisgarh Cooperative Societies Act, 1960 to the appellants, proposing recovery of Rs.37,19,664.48 from them as legal heirs of the deceased employee. Aggrieved by the issuance of the said show- cause notice, the appellants preferred a writ petition, which came to be dismissed by the learned Single Judge vide impugned order dated 22.04.2026 with liberty to submit a reply before the competent authority. Being aggrieved by the said order, the appellants have preferred the present writ appeal. 4. Learned counsel for the appellants submits that the learned Single Judge failed to appreciate that the impugned show-cause notice dated 28.09.2022 is wholly without jurisdiction and has been issued in contravention of Section 58-B of the Chhattisgarh Cooperative Societies Act, 1960. It is contended that no enquiry was ever instituted or conducted against Late Shri Tekram Kaushik during his lifetime, nor was he afforded the reasonable opportunity of hearing mandatorily contemplated under the first proviso to Section 58-B(1). In the absence of a valid enquiry against the employee while he was alive, the respondent authorities could not have initiated recovery proceedings against 4 his legal heirs after his death, as the liability under Section 58- B(2) can arise only upon the conclusion of a lawful enquiry under Section 58-B(1). It is further submitted that allegations of misconduct or negligence are personal to the employee and cannot be adjudicated posthumously when the person concerned is no longer available to defend himself. The issuance of a recovery notice to the widow and son of the deceased, without any prior determination of liability during the lifetime of the employee, is arbitrary, illegal and an abuse of statutory power. It is also urged that the learned Single Judge ought to have interfered at the threshold, as the impugned notice is ex facie without jurisdiction, and relegating the appellants to avail an alternative remedy would only compel them to undergo vexatious proceedings founded on an enquiry which itself is void in law. 5. Learned counsel appearing for the respective respondents submits that the learned Single Judge has rightly declined to interfere with the impugned show-cause notice, as the same is merely a preliminary notice issued under Section 58-B of the Chhattisgarh Cooperative Societies Act, 1960 and does not determine any liability. It is contended that Section 58-B(2) of the Act specifically empowers the Registrar to proceed against the legal representatives of a deceased employee and recover the loss caused to the Society to the extent of the estate inherited by them. The appellants have been afforded an opportunity to submit their explanation before the competent authority, and therefore no 5 prejudice has been caused to them at this stage. It is further submitted that the Act provides an efficacious statutory remedy by way of an appeal under Section 58-B(3) against any order passed by the Deputy Registrar, and therefore the writ petition was rightly held to be premature. It is thus urged that the appellants ought to avail the statutory remedy available under the Act and that the present appeal, being devoid of merit, deserves to be dismissed. 6. We have heard learned counsel for the parties and gone through the documents annexed with the appeal as well as petition and the order passed by learned Single Judge of this Court in the WPS No. 7194/2022. 7. Section 58 B of the Chhattisgarh Cooperative Society Act, 1960 is reproduced hereinunder:- "Section 58-B. Procedure for making good losses caused to a society- Notwithstanding anything contained in this Act or the rules or the byelaws of a society where the State Government has contributed to its share capital or has given loans or financial assistance or has guaranteed the repayment of loans, debentures, advances or has given grants in any other form and if in the course of an audit, inquiry, inspection or the winding up of a society or otherwise, it is found that any person who is or was entrusted with organization or management of such society or any deceased, past or present Chairman or Secretary, member of the Committee, Officer or employee of the society has made any payment contrary to the provisions of this Act or the rules made thereunder or byelaws of a society or has caused any deficiency or loss by gross negligence or misconduct or has misappropriated or fraudulently retained 6 any money or other property belonging to such society, the Registrar may on his own motion or on the application of the committee, liquidator or any creditor, enquire himself or direct some person authorized by him, by an order in writing in this behalf, to enquire into the conduct of such person within two years of the date of the report of audit, enquiry or inspection, or winding up, as the case may be: Provided that no such enquiry shall be instituted against a person unless the person concerned is given a reasonable opportunity of being heard. (2) If, on enquiry made under sub-section (1), the Registrar is satisfied that there are reasonable grounds for an order under this sub-section, he may make an order requiring such person, or in the case of a deceased person, his legal representative who inherits his estate, to repay or restore the money or property or any part thereof, with interest at such rate, or to pay contribution and costs or compensation to such extent as the Registrar may consider just and equitable: Provided that no order under this sub-section shall be made unless the person concerned is given a reasonable opportunity of being heard in the matter: Provided further that the liability of a legal representative of the deceased shall be to the extent of the property of the deceased which has come to the hands of such legal representative. (3) Any person aggrieved by the order made under sub- section (2), may within thirty days from the date of communication of the order to him appeal to the State Government. Provided that in computing the period of limitation, the time requisite for obtaining a copy of the order appealed against shall be executed. 7 (4) Any order made under sub-section (2) or sub-section (3) shall be enforced in accordance with the provisions of section 85. (5) If the Registrar is satisfied by an affidavit, enquiry or otherwise that any person with intent to delay or obstruct him under this Section- (a) is about to dispose of the whole or any part of his property: or (b) is about to remove the whole or any part of his property from the jurisdiction of the Registrar; he may, unless adequate security is furnished, direct the conditional attachment of the said property or such part thereof as he thinks necessary." 8. Upon a careful consideration of the rival submissions, we are of the considered opinion that the learned Single Judge has committed no error warranting interference in the present intra- court appeal. A plain reading of Section 58-B of the Chhattisgarh Cooperative Societies Act, 1960 makes it evident that the statute specifically contemplates proceedings against the legal representatives of a deceased employee to the extent of the estate inherited by them. The impugned communication is merely a show-cause notice affording the appellants an opportunity of hearing before any final determination of liability is made. The proviso to Section 58-B(2) further mandates that no order of recovery can be passed without granting a reasonable opportunity of hearing, and the appellants have admittedly been afforded such opportunity. Their contention that the proceedings are wholly without jurisdiction cannot be accepted at this preliminary stage, 8 particularly when the competent authority has yet to adjudicate upon the allegations and determine the extent of liability, if any, in accordance with law. Moreover, the Act provides an efficacious statutory remedy against any order passed under Section 58-B(2). In these circumstances, the learned Single Judge was justified in declining to interfere with the show-cause notice and in relegating the appellants to participate in the statutory proceedings. 9. Thus, considering the submissions made by the parties and in the aforesaid facts and circumstances of the case and the finding recorded by the learned Single Judge, we are of the considered opinion that the learned Single Judge has not committed any illegality, irregularity or jurisdictional error in the impugned order warranting interference by this Court. 10. Accordingly, the writ appeal being devoid of merit is liable to be and is hereby dismissed. 11. However, as observed by the learned Single Judge, the appellants shall be at liberty to participate in the pending proceedings and defend their case in accordance with the provisions contained in Section 58-B of the Chhattisgarh Cooperative Societies Act, 1960. Sd/- Sd/- (Ravindra Kumar Agrawal) (Ramesh Sinha) Judge Chief Justice Sagrika