W.P.No.15070 of 2025

IN THE HIGH COURT OF JUDICATURE AT MADRAS

RESERVED ON : 05.12.2025

PRONOUNCED ON : 22.01.2026

CORAM:

THE HONOURABLE MR. JUSTICE V. LAKSHMINARAYANAN

W.P.No.15070 of 2025 &

WMP.No.16981 of 2025

B.Chennamoorthy ... Petitioner

Vs.

1.The Deputy Registrar of Cooperative Societies,

Krishnagiri Circle,

Krishnagiri District.

2.The Administrator,

D.K.137, Krishnagiri District Primary

Agricultural Cooperative Credit Society

Employees’ Cooperative Thrift and Credit Society Ltd.,

Gandhi Nagar, 2

nd

Cross,

Opp. To Amman Gas Agency,

Krishnagiri District – 635 001.

3.The Sub Registrar,

Dharmapuri West,

S.V.Road, Dharmapuri District. ... Respondents

PRAYER: Writ Petition filed under Article 226 of the Constitution of

India praying to issue a writ of certiorarified mandamus calling for the

records of the first respondent in ARC.No.3 of 2024 dated 14.05.2024

and 23.05.2024 made under Section 167 r/w Rule 140 of the Tamil

Nadu Cooperative Societies Act and Rules attaching the petitioner’s

immovable property in Survey no.304/1A1, Sub Division

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W.P.No.15070 of 2025

No.304/1A1A1A1 covered under Sale Deed in Document No.4693 of

2023 dated 08.09.2023 and quash the same as illegal, without

jurisdiction and against the principles of natural justice; since the

impugned orders is made in violation of Section 144 of the Tamil

Nadu Cooperative Societies Act and the division bench decision of this

Court in W.A.(MD).No.1511 of 2018 Paragraphs 8 to 10 in the

Management v. S.Rathinam dated 11.12.2018; consequently, direct

the 3

rd

respondent to remove the encumbrance made in respect of

petitioner’s immovable property in Survey No.304/1A1, Sub Division

No.304/1A1A1A1 covered under Sale Deed in Document No.4693 of

2023 dated 08.09.2023 on its file.

For Petitioner :Mr.S.Sathiaseelan

For Respondents :Mr.M.Muthusamy,

Government Advocate

ORDER

This court had entertained the writ petition and granted an

interim order. The respondents filed a vacate stay petition. When the

matter was listed before this Court, by consent of the counsel, the

main writ petition itself was taken up for hearing.

2. I heard Mr.S.Sathiaseelan for the petitioner and

Mr.M.Muthusamy, learned Government Advocate for the respondents.

3. The first respondent passed an order of interim attachment of

the property of the petitioner on 14.05.2024. Subsequently, the

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interim attachment was made absolute on 23.05.2024. Challenging

the same, the present writ petition.

4. The case of the petitioner is that he had purchased the

petition mentioned property from one S.Kavitha. The said Kavitha is

the wife of one Rajendran, the Secretary (currently under suspension),

of the second respondent Society. Kavitha had originally purchased

the property by way of two registered sale deeds dated 22.04.2015 and

22.07.2016. On 08.09.2023, the petitioner purchased the said

properties from Kavitha. The purchase of the property is evidenced by

a sale deed bearing Document No.4693 of 2023.

5. Alleging misappropriation of funds by Mr.Rajendran, the

second respondent presented a petition under Section 90 of the Tamil

Nadu Cooperative Societies Act, 1983 (hereinafter referred to as the

‘TNCS Act’) read with Rule 107 of the Tamil Nadu Cooperative

Societies Rules (hereinafter referred to as the ‘TNCS Rules or TNCSR’,

as the case may be). This application was taken on file by the first

respondent as ARC.No.3 of 2024. In the said ARC, the petitioner

herein has been arrayed as the second respondent. While the ARC is

pending consideration before the first respondent, fearing that the

respondents in the ARC, might alienate their property, the second

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W.P.No.15070 of 2025

respondent took out an application invoking Section 167 of the TNCS

Act read with Rule 140 of the TNCS Rules of 1988.

6. By the first of the impugned order dated 14.05.2024, the first

respondent issued a notice to the respondents 1 to 5 therein, which

included the writ petitioner, and passed an order of interim

attachment. Since the security directed by this order had not been

furnished, the first respondent made the provisional attachment

absolute by the second impugned order dated 23.05.2024.

7. It is the plea of Mr.S.Sathiaseelan that, the orders are

untenable and liable to be quashed. After narrating the facts, he

submitted as follows:

(i) Prior to the initiation of proceedings under Section

90 of the TNCS Act, the Deputy Registrar of Co-operative

Societies, Krishnagiri, had ordered an enquiry under

Section 81 of the TNCS Act. This enquiry was based on a

report submitted by the Co-operative Sub Registrar,

Krishnagiri. The Co-operative Sub Registrar was appointed

as the enquiry officer by an order dated 15.04.2024. The

said appointment order was put to challenge in

W.P.No.31589 of 2024. By an order dated 23.10.2024, this

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Court quashed the appointment order on the ground that

the person, who conducted the preliminary enquiry, ought

not to have been appointed as the enquiry officer under

Section 81. The consequence of this is that, the

proceedings of attachment have to fail.

(ii) His second submission being that the

proceedings initiated under Section 90 of the TNCS Act is

barred by limitation as would be evident from a perusal of

Section 90(9)(a)(ii) of the TNCS Act. Referring me to a

paragraph 11 of I.A.No.1 of 2024 in ARC.No.3 of 2024, he

states that, on the face of the petition, it becomes clear

that it is barred by Section 90 of the Act. In furtherance of

this submission, he points out that a reference to a Full

Bench is pending in W.A.No.1522 of 2009 etc. batch, with

respect to the question whether the limitation would

commence from the date of misappropriation or whether it

should be deemed to commence only after it comes to the

knowledge of the Co-operative Society.

(iii) Placing reliance upon judgment of the Division

Bench of this court in The Management, R.A.No.18,

Thiruvengadapuram Primary Agriculture Cooperative

Credit Society v. S. Rathinam in W.A. (MD) No. 1511 of

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W.P.No.15070 of 2025

2018 dated 11.12.2018, he pleads that attachment

proceedings cannot be initiated against a non member or a

stranger to the co-operative society. According to him, the

petitioner’s vendor, Kavitha, herself is a non member, and

therefore, no proceedings could have been initiated even

against her and, consequently, no proceedings have been

initiated against the petitioner.

(iv) Referring to Section 144 of the TNCS Act along

with Rule 135 of TNCSR, he points out that there is a

statutory impediment to proceed against a third party

and, since attachment proceedings had been initiated

against the petitioner, who is a stranger to the society,

this court should apply the aforesaid judgment and allow

the writ petition.

8. In addition to the order, referring the issue to the Full Bench

and the order in the writ appeal referred to above, Mr.S.Sathiaseelan

placed reliance upon the following judgments:

(i) Kattabettu Industrial Co-operative Tea Factory Limited v.

V. Radhakrishnan, (1999) 1 LW 725 ;

(ii) Narmada Bachao Andolan v. Union of India, (2000) 10

SCC 664;

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W.P.No.15070 of 2025

(iii) Bharathidasan University v. All-India Council for

Technical Education, (2001) 8 SCC 676 ; and

(iv) Union of India v. S. Srinivasan, (2012) 7 SCC 683.

9. Mr.M.Muthusamy submits that the writ petition is not

maintainable, since the issue is covered by the Full Bench of this

court in K. Marappan v. Deputy Registrar of Co-operative

Societies, Namakkal Circle, Namakkal, (2006) 4 CTC 689 .

According to him, no writ petition is maintainable against a

cooperative society and therefore on this short ground, the writ

petition must be dismissed.

10. In the alternative, Mr.M.Muthusamy submits that the

petitioner has an effective alternate remedy under Rule 135 of the

TNCS Rules and in addition, he can prefer an appeal under Section

152 of the TNCS Act to the statutory Tribunal, namely, the Principal

District Court, Dharmapuri. On the merits, he pleads that the writ

petitioner is a close relative of Mr. Rajendran, the Secretary, who is

now under suspension. He urges that it came to the notice that, in

order to escape the clutches of law, Mr.Rajendran diverted the amount

misappropriated by him, into the name of his wife, Kavitha and that

Kavitha had, in turn, sold the property to her relative, namely, the writ

petitioner, B. Chennamoorthy, and Mr. Karthick.

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11. Mr.M.Muthusamy adds, when the society came to know that

the petitioner and others are going to alienate the property, they

moved an application for conditional attachment under Section 167 of

the TNCS Act before the first respondent. The first respondent was

convinced with the averments made in the petition and directed them

to furnish security. This order was served on the petitioner on

15.5.2024 through RPAD and, since the petitioner did not furnish

security, the authority made the conditional order of attachment

absolute.

12. On the first plea, Mr.M.Muthusamy points out that, after the

appointment of Ms.Kalpana was set aside by this Court in

W.P.No.31589 of 2024 by order dated 23.10.2024, by an order dated

27.12.2024, the Deputy Registrar, Krishnagiri Circle, had appointed

one Mr.S.Arunkumar as the enquiry officer under Section 81 of the

TNCS Act. He pleads that, out of the ill-gotten wealth, Mr.Rajendran

had purchased the property in the name of his wife and that, the said

property is answerable to the claim of the society. He further pleads

that, there is no violation of Section 167 of the TNCS Act, nor is there

any illegality committed by the first respondent as he had not

furnished security to the claim of the society. Hence, he seeks

dismissal of the writ petition.

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13. Since the plea of alternate remedy has been raised, it would

be appropriate to address the said issue at the threshold and

thereafter, proceed further. The Five-Judges Bench in K.Marappan’s

case cited supra held that a writ petition is not maintainable against a

cooperative society as such societies do not answer the description of

‘State’ or ‘instrumentality of State’ under Article 12 of the Constitution

of India. This is because, the regulatory power exercised by the

Registrar is not so deep or pervasive as to include a society under the

TNCS within the scope of a ‘State instrumentality’. Exception was

created that in case statutory public duty is imposed upon the society

and it fails to perform the same, a writ petition would be maintainable.

On the facts of the case, Mr.K.Marappan had challenged his demotion,

and the same was rejected by this court, holding that it was a

contractual matter, and that the proper remedy should be, to file an

alternate proceeding under the TNCS Act.

14. I have extracted the salient points of K.Marappan’s case in

order to point out that Mr.K.Marappan had challenged an action of a

Cooperative Society. Hence, this court had taken a view that writ

petition is not maintainable. However, is not the situation in the

present case. The order of attachment has been passed by the first

respondent exercising its statutory power. Here, the order passed by

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the first respondent is not an order passed by the second respondent,

but an order passed on an application filed by the second respondent.

If it had been the order passed by the second respondent, I would have

agreed with Mr.M.Muthusamy. That not being the factual position, I

have to reject the argument relying upon the Marappan’s case.

15. Insofar as the plea under Section 152 of the TNCS Act is

concerned, I have to point out that, since the issues of interpretation

of law and jurisdiction have been raised, the writ petition would be

maintainable. [See Radhakrishan Industries v. the State of

Himachal Pradesh and Others, AIR 2021 SC 2114 (paragraphs 20

& 26)].

16. In addition, this Court had entertained the writ petition, and

had granted an interim order, and issued notice. The practice of this

Court has been that, where a writ petition has been entertained, a

party must not turned away at the stage of final disposal referring to

the doctrine of alternate remedy. Hence, I am inclined to go into the

merits of the case.

17. A perusal of the typed set of papers shows that in ARC.No.3

of 2024, not only Mr.Rajendran, but also four other persons have been

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impleaded as parties. The petitioner has been arrayed as the second

respondent therein. When the writ petitioner has been made as a

party to the proceedings, the plea that he is a third party, cannot

stand scrutiny even for a moment. ‘Third party’ to a proceeding means

a person other than those arrayed as parties. When the petitioner is

admittedly a party to the proceedings, as is clear from page 112 of the

type set of papers, the plea of Mr.S.Sathiaseelan that he is a ‘third

party’ and, therefore, his property ought not to have been attached is

absolutely untenable.

18. On the aspect of maintainability, under Section 90 of the

TNCS Act, I have to point out that under Section 90(1)(c), if a dispute

arises between the society and any officer, agent or servant, then an

application is maintainable before the Registrar. Insofar as

Mr.Rajendran is concerned, the petition filed in ARC.No3 of 2024

discloses that he was the Secretary of the society from 01.02.2009

onwards till 2023, when he was placed under suspension. Since

Mr.Rajendran continues to be under suspension, as the relationship of

employer and employee subsists between the society and him.

Consequently, a petition under Section 90 is maintainable. This leads

us to the aspect of limitation that has been raised by Mr.Sathiaseelan.

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19. Under Section 90(9)(a)(ii) of the TNCS Act, if the dispute

relates to

“any act or omission” on part of any of the parties

referred to clause (b) or (c) of subsection (1), then the period

of limitation shall be six years from the date on which the

act of omission, with reference to which dispute arose, took

place.”

20. On this aspect, I should point out, that the issue of

limitation is a mixed questions of law and fact. This implies that the

issue of limitation should not be decided in a summary manner

without affording the parties to an opportunity to present evidence,

especially, when the facts giving rise to the cause of action are

disputed. Unless and until plain reading of the petition itself discloses

that the claim is barred by limitation, the court should not throw out

the petition on the ground of limitation. The issue of being barred by

time should be “patently and unequivocally” evident from the petition

itself. Whether the society was aware of the malverisation of funds by

Mr.Rajendran in the year 2015 itself or whether it came to be aware of

the facts subsequently, are matters which require oral and

documentary evidence.

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21. The statement of Mr.Sathiaseelan that, as the matter has

been referred to the Full Bench, the doubt persists does not appeal to

me. This is because, the reference is not with respect to section 90(9)

(a)(ii) of the TNCS Act, but pertains to interpretation of Section 87 of

the TNCS Act.

22. Apart from this, the pendency of a reference does not ipso

facto result in a stay of proceedings involving the same issues, nor

does it render the existing judgment ineffective. The courts must

continue to apply the law as it stands. [(See, Ashok Sadarangani v.

Union of India, (2012) 11 SCC 321 , (para 29)]. As the reference

relates to an entirely different provision under the TNCS Act, which

only incorporates a similar provision as under Section 90, I am of the

view that the plea of Mr.S.Sathiaseelan on the basis of the reference

made in the year 2013, is not germane to the facts of the present case.

As I am not going into the issue of limitation, it is left open to the writ

petitioner to raise the plea before the first respondent during the

course of proceedings in ARC 3 of 2024, and if it is so raised, the first

respondent shall frame an issue and answer the same.

23. I shall now advert to the fulcrum of Mr.S.Sathiaseelan's

argument, namely, the application of the judgment of this Court in

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W.A(MD).No.1511 of 2018 and the interpretation to Section 144 of the

TNCS Act. The Division Bench of this Court held, in the aforesaid

case, that the property of a third party cannot be a subject matter of

attachment during the course of surcharge proceedings. After reading

this judgment extensively, Mr.Sathiaseelan took me to Section 144 of

the TNCS Act to urge that it applies only for recovery of debt from a

member, past or present, or the legal heirs of a deceased member.

Hence, he pleads that the petitioner's property is not capable of being

attached.

24. I have already pointed out that the writ petitioner, being the

second respondent in ARC 3 of 2024, he cannot be treated as a third

party. I am of the view that Section 144 also does not apply to the

facts of the present case, since Section 144 falls under Chapter XVI,

which relates to execution of decrees, decisions, awards and orders.

Even under traditional civil law, a third party to a decree cannot be

made answerable to the decree, other than in certain exceptional

circumstances.

25. In the case before the Division Bench in W.A(MD).No.1511 of

2018, the writ petitioner Tmt. S.Rathinam, had not been arrayed as a

party to the proceedings under Section 87 of the TNCS Act. Yet, her

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property was attached. It was in those circumstances, the Division

Bench held that a Society cannot proceed against the property of a

stranger. In this case, since the writ petitioner has been arrayed as the

second respondent in ARC 3 of 2024, he is obviously neither a third

party nor a stranger to the proceedings. Hence, the judgment in

Rathinam's case does not come to the rescue of the writ petitioner.

26. Rule 135 (2) of the TNCS Rules falls under Chapter XI, which

relates to execution. This Chapter commences with Rule 115 and goes

on till Rule 144. Therefore, the reliance placed by the Government

Pleader on Rule 135 is equally untenable. It is nobody's case, that an

award has been passed and in execution of such an award, the

attachment has taken place. As seen from the facts, an arbitration

petition had been filed under Section 90 of TNCS Act. Pending disposal

of the said proceedings, an application for attachment had been taken

out. Such an application is akin to an application for attachment

before judgment under Order XXXVIII of the Code. An attachment

pursuant to a decree would fall under Order XXI of the Code.

27. The entire argument of Mr.Sathiaseelan is based on the

proceedings which deal with execution and not based on proceedings,

pending disposal of the original claim petition. When Section 144 does

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not apply to the fact of the case, placing reliance upon the same is

totally untenable.

28. The application seeking attachment falls under Chapter XIX.

This is covered under Section 167 of the TNCS Act. Under this

provision, if the Registrar is satisfied, on an application filed by a

registered society in respect of a reference under Section 90(1) of the

TNCS Act, that any party to the reference is about to dispose of or

remove from his jurisdiction, the whole or any part of the property,

with an intention to delay or defeat execution or any decision that may

be passed on reference, the Registrar, by an order, can direct the party

to furnish security. Under Section 167(2), he can also pass an order of

conditional attachment, but, such order is subject to the proviso

contained therein. The corresponding Rule for Section 167 of the

TNCS Act is Rule 140 of the TNCS Rules. As in the Code of Civil

Procedure, if a third party’s property is attached, then under Rule

140(2), he is entitled to investigate the matter in the same manner as

it would be done in course of execution proceedings under Rule 135 of

the TNCS Rules.

29. It is a settled position of law that a claim petition cannot be

filed by a party to a proceeding. A claim petition must be filed by a

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stranger or a third party to the proceeding. When the writ petitioner is

himself a party to the proceedings, it does not lie in his mouth to

content that judgments which relate to third party proceedings should

be applied to him.

30. I shall now examine whether the impugned order satisfies

the requirement of Section 167 of the TNCS Act. Under Section 167,

satisfaction has to be recorded by the Registrar that the respondent

before him in a reference under Section 90 is about to dispose of the

property. In such a case, he should call upon the party to furnish

security and to pass an order of interim attachment.

31. A perusal to the order dated 14.05.2024 shows that the

Registrar has been satisfied with the claim filed before him for a sum

of Rs.84,82,148/-. He has also been satisfied that the respondents

were attempting to alienate the property. Accordingly, he had called

upon them to furnish security on or before 22.05.2024. Pending the

proceedings, he had attached the property recording his satisfaction in

paragraph 1 of the said order. Therefore, by an order dated

23.05.2025, the attachment was directed to continue until further

orders.

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32. An opportunity was given to the petitioner to appear before

the first respondent on 22.05.2024 and furnish security. The counter

asserts that, notice calling upon him to furnish security had been

served and yet, the petitioner had not complied with the same. This

factual avernment had not been denied by the writ petitioner. When a

notice has been issued to a party and the same is duly served, and

still the party chooses not to appear or object to the same, he cannot

thereafter turn around and plead violation of principles of natural

justice.

33. When the second impugned order came to be passed on

23.05.2024, all that the first respondent had before him, was the

petition filed by the second respondent asserting that the respondents

therein were attempting to alienate the property. The petitioner did not

even take steps to appear before the authority to state that he had no

such intention to do so. There is no such averment in the affidavit filed

in support of the writ petition either. When the first respondent,

exercising statutory power under section 167(2) noticed that the

respondents before him have not furnished security, the only order

that he has to pass is to continue the prohibitory order earlier passed

on 14.05.2024.

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34. It is still not too late for the petitioner to move the first

respondent by way of an application and furnish security to the claim

in ARC.No.3 of 2024 and thereafter, seek raising of attachment. The

petitioner has averred that there is no show cause notice was issued

to him. This assertion is contrary to the specific statement in

paragraph 5.4 of the counter affidavit wherein the respondent has

stated as follows:

“the said notice was served on the petitioner on

15.05.2024 through Registered post with

acknowledgement due”

35. Now turning to the authorities cited by Mr.S.Sathiaseelan,

the judgment in The Kattabettu Industrial Co-operative Tea

Factory Limited v. V.Radhakrishanan and others, (1999) 1 LW

725, on the question of limitation, after the proceedings had

concluded before the Registrar, and an appeal under Section 152 of

the TNCS Act had been filed before the Appellate authority. The

Appellate authority had concluded on facts that the reference was

barred. This shows that the judgment came to be pronounced on the

basis of appreciation of evidence and not at a preliminary stage as in

the present case. Furthermore, the challenge before this Court today is

only to an order of interim attachment, and the issue of limitation, as

pointed out above, being a mixed questions of law and facts, cannot be

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collaterally raised in a writ proceedings. It is for the petitioner to

appear before the competent authority as set forth above and raise the

plea.

36. The judgments in Bharathidasan University v. All-India

Council for Technical Education, (2001) 8 SCC 676 and Union of

India v. S. Srinivasan, (2012) 7 SCC 683 both dealt with the issue

where a Rule exceeding the Statute. I should point out that no

declaration has been sought in this writ petition that the Rule is

unconstitutional. Furthermore, these cases does not relate to Section

144, which, as already pointed out, arises only in case of execution.

We are still at a stage prior to the passing of an award/decree and

hence, the judgments relied upon are not applicable to the facts of this

case. The constitutional validity of a provision is a grave matter and

should follow specific procedural channels designed for that purpose.

It cannot be raised in a collateral challenge and that too, in a

proceeding where the provisions sought to be nullified does not even

apply.

37. In fact, the very paragraph relied upon by Mr.S.Sathiaseelan

in Narmada Bachao Andolan v. Union of India, (2000) 10 SCC

664 holds that where there is a valid law, the court without striking

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down the same cannot give any direction, which is contrary to the said

law. This is a proposition that as long as the law stays on the statute

book, the court has to apply as it is. This proposition also does not

help Mr.S.Sathiaseelan. I have concluded in the earlier portion of this

order that Section 144 applies only to execution proceedings whereas,

the law applicable for the present proceedings is governed by Section

167 of the TNCS Act read with Rule 140 of the TNCS Rules and there

is no necessity for me to go into the so called conflict between Section

144 of the TNCS Act and Rule 135 of the TNCS Rules.

38. In the light of the above discussion, leaving it open to the

petitioner to approach the first respondent, furnish security, and seek

for raising of attachment of the property, this writ petition is

dismissed. No costs.

39. Just before the pronouncement of the judgment,

Mr.S.Sathiaseelan reported that Hon’ble Mr.Justice G.K.Ilanthiraiyan

has quashed A.R.C.No.3 of 2024 and the order of attachment dated

23.05.2024, by an order dated 05.08.2024 in W.P.No.14633 of 2024

(P.Sundaresan v. The Registrar of Co-operative Societies and

Others). A perusal of the papers shows that the learned Judge has

allowed the writ petition insofar as the Writ Petitioner therein is

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W.P.No.15070 of 2025

concerned. Hence, this judgment would not be applicable to the

petitioner.

22.01.2026

nl

Neutral Citation : Yes/No

To

1.The Deputy Registrar of Cooperative Societies,

Krishnagiri Circle,

Krishnagiri District.

2.The Administrator,

D.K.137, Krishnagiri District Primary

Agricultural Cooperative Credit Society

Employees’ Cooperative Thrift and Credit Society Ltd.,

Gandhi Nagar, 2

nd

Cross,

Opp. To Amman Gas Agency,

Krishnagiri District – 635 001.

3.The Sub Registrar,

Dharmapuri West,

S.V.Road, Dharmapuri District.

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W.P.No.15070 of 2025

V. LAKSHMINARAYANAN. J,

nl

W.P.No.15070 of 2025

22.01.2026

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