Nene Sir,
What action can be taken against the chairman / secretary of a housing society if they has misused the society funds?
Ans : I would like to deal with the question in a detailed manner.
First of all, has it been ascertained that it was the chairman / secretary alone who misused funds ? If yes then how ? Because all the members of the managing committee are jointly and severally held responsible for all the decisions taken by the managing committee.
Let’s assume for the sake of argument that the money was spent by the office bearers without the approval of the managing committee.
In such a case, all the three office bearers would be held responsible. The reason being, it is the treasurer who is supposed to be in possession of the cheque book and is responsible for all the cheques issued, along with the other office bearers signing the cheque.
Further, every cheque issued by the society has to be signed by the secretary and anyone of the other two office bearers.
Therefore, if there has been a misuse of funds, all the office bearers would be held responsible and it would be really difficult to pin down just the chairman or secretary unless and until he has committed a fraud in his personal capacity that can be proved.
Now, let’s assume that it has been established beyond doubt that there has been a misappropriation of the funds by the office bearers, and there is documentary evidence available to prove the same.
In such a case, the deputy registrar of the society must be immediately informed about the matter by a bona-fide member of the society, and all the available evidence must the attached to the letter.
The deputy registrar of the society, on receipt of such letter, will call the office bearers and the complainants to understand the matter and will initiate necessary action.
Just in case the deputy registrar fails to take necessary action against the office bearers, the matter can be escalated to the divisional joint registrar.
Society is also covered under RTI. So you have options.
Having written above, I have word of caution—the Officials in Registrar’s office are never responsive to any such initiative or complains. They have other things to do, you see.
So think carefully before riding on this path. What if Registrar does not respond. They need incentive for responding, may be. Not always, but just in case. They are not exactly known for their honest dealing, you might be aware.
Option of going to a lawyer?? Well , s/he will get richer at your cost.
Hope this answers your question.
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