College account frozen since 2021: Chhattisgarh HC gives Registrar 60 days to decide who runs the society
Justice Amitendra Kishore Prasad declined to pick between rival claimants to the secretaryship of an Ambikapur agriculture college society, and instead ordered the Registrar of Firms and Societies to finish its inquiry and rule, after which the State Bank of India must let the winners operate the account.
An agriculture college in Ambikapur has had its current account frozen for more than five years because two men each claimed to be secretary of the society that runs it. The Chhattisgarh High Court has refused to resolve that contest itself. Disposing of two writ petitions by Margdarshan Sansthan on 26 October 2026, Justice Amitendra Kishore Prasad directed the Registrar, Firms and Societies, to complete the pending inquiry and decide, by a reasoned order within 60 days, which persons are legally entitled to manage the society. Only then will the State Bank of India unfreeze the account, and only for whoever the Registrar names.
A resignation, a new secretary and a hold on the account
Margdarshan Sansthan is registered as Society No. 373 of 14 October 1992 and has run an agricultural education institution affiliated to Indira Gandhi Krishi Vishwavidyalaya, Raipur, since 2002. According to the society, its earlier secretary, Manvendra Pratap Singh, resigned on 24 November 2016 and the resignation was accepted two days later. At an emergency meeting on 27 November 2016 Premendra Pratap Singh was appointed secretary along with other office-bearers, including the president. The Assistant Registrar approved that appointment by an order of 4 December 2017, and a resolution of 10 December 2017 provided that the society's bank account would be operated on the joint signatures of the principal, Sushil Kumar Srivastav, and the new secretary. Manvendra Pratap Singh was a respondent in both petitions but died during their pendency and was deleted from the array by an order of 30 September 2026.
On 25 February 2021 the State Bank of India's City Branch, Ambikapur, placed Current Account No. 35033300020 under hold. The society says it received no notice. Representations on 20 and 25 February 2021 and a legal notice of 1 March 2021 produced nothing. Tuition fees deposited by students could not be withdrawn to pay for food, water, electricity and other basic facilities, and the salaries of teaching and non-teaching staff were hit. That is the grievance in W.P.(C) No. 1596 of 2021.
The second petition, W.P.(C) No. 4874 of 2021, attacks an order of the Registrar of 18 November 2021 in Appeal Case No. 426/2021. The Registrar partly allowed the society's appeal and set aside an order of the Assistant Registrar dated 15 June 2020, but went on to direct an inquiry into the society's affairs by a three-member committee that included the Assistant Registrar, with a report within three months if possible. Until the dispute was resolved, the trustees and founder members were to look after the society's day-to-day affairs.
Arbitrary freeze, or a bank with no way to choose
A.N. Bhakta, appearing with Vivek Bhakta in the first petition, called the hold arbitrary and without authority of law. The secretary's appointment had been approved by the competent authority in 2017, the joint-signature arrangement was in place, and the account was frozen without any notice or hearing, in breach of Articles 14 and 21. He asked for the order to be set aside and for directions letting the authorised office-bearers operate the account under the society's resolution.
In the second petition, Sourabh Sharma argued that the Registrar had exceeded his appellate jurisdiction. Section 32 of the Chhattisgarh Societies Registration Act, 1973, he said, prescribes how an inquiry into a society's affairs is conducted, by the Registrar himself or a person he authorises, and does not contemplate a three-member committee of the kind ordered. The Assistant Registrar whose order had just been set aside was then put on the committee that would inquire afresh, which gave rise to a reasonable apprehension of bias. And the Registrar could not initiate proceedings on his own motion while sitting in appeal under Section 40 when the statutory requirements for starting an inquiry under Section 32 had not been met. The directions, he added, interfered with a governing body whose composition the competent authority had already approved.
The State's panel lawyer, Anway Tiwari, said the real dispute was between the society and the late respondent, both of whom claimed the office of secretary, and that the account had been put on hold because of those rival claims pending a decision by the competent authority. No substantive relief had been sought against the State and no illegality alleged against it; the quarrel was about the society's internal management. D.N. Prajapati, for the Registrar of Indira Gandhi Krishi Vishwavidyalaya, took the same line: the university had no role in the hold and nothing was sought against it.
For the bank, P.R. Patankar explained the trigger. The Assistant Registrar, Firms and Societies, Surguja, had written to the bank on 9 April 2019 about the alleged creation of a parallel managing society and the possibility of funds being withdrawn through unauthorised means. Faced with two claimants to the secretaryship and that warning, the bank froze the account to protect the institution's money. A bank, he said, is only the custodian of deposits and cannot adjudicate which rival is entitled to operate an account. The bank undertook to permit operation of the account in whatever manner the court directed.
Why the court sent the question to the Registrar
Justice Prasad found that the controversy in both petitions turned on a single unresolved question: who is lawfully entitled to manage the society. The bank account dispute, he held, is intrinsically connected with that determination, and the bank cannot be expected to decide rival claims to control a society or its account. At the same time, a frozen account has the potential to affect the day-to-day running of an educational institution, including salaries and essential facilities for students. The right course, he concluded, was to direct the competent authority to bring the dispute to its logical conclusion within a fixed period, after hearing everyone concerned.
The judge did not rule on the Section 32 and Section 40 arguments or on the alleged bias in the committee's composition. He recorded that the second petition questioned the Registrar's authority to issue those directions, and framed the dispute as essentially about the legality of those directions and, more importantly, about who should administer the society under its bye-laws and the statute. He expressly left the merits of the rival claims to the secretaryship untouched and told the competent authority to decide uninfluenced by anything in his order.
Order
Both petitions, W.P.(C) Nos. 1596 and 4874 of 2021, were disposed of with directions. The Registrar, Firms and Societies, must first ascertain whether the inquiry contemplated by the 18 November 2021 order has been completed; if not, it is to be finished expeditiously in accordance with law. After considering the inquiry report, the existing members, the records, the bye-laws and the claims of all persons concerned, the Registrar must decide by a reasoned order which persons are legally entitled to manage and administer the society, and whether the existing members may continue or others are entitled to take over. The hearing must include the intervenor, represented by Gagan Tiwari, whose claim arises from a later appointment as secretary. The whole exercise is to be completed within 60 days of receipt of a certified copy of the order.
Once the Registrar decides, the current account placed on hold by the State Bank of India is to be operated by the person or persons found entitled, and the bank must act in conformity with that decision. Pending interlocutory applications were disposed of. There was no order as to costs.