KATHMANDU, May 12: The Supreme Court (SC) has issued a mandamus directing the formation of the National Cooperatives Regulatory Authority (NCRA) to resolve issues in the cooperative sector.
In a petition filed by senior advocate Surendra Bhandari and others, the bench of Justices Kumar Regmi and Nityananda Pandey, ordered the formation of a recommendation committee within seven days to establish the NCRA.
The mandamus also specifies that the NCRA must be fully established within a maximum of one and a half months.
The SC’s mandamus states, “In accordance with Section 103 (1) of the amended Cooperative Act, 2074, as revised by the Cooperative (Amendment) Act, 2081, the Government is required to form a recommendation committee within a maximum of seven days from today's date to recommend the appointment of the Chairperson and members of the NCRA. The NCRA must be fully established within a maximum of one and a half months.”
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It mentions that the necessary infrastructure must be prepared to implement the duties and powers of the NCRA.
Additionally, the directive includes the implementation of the recommendations from the report of the parliamentary committee formed to address cooperative sector issues.
The order also specifies that regarding the return of savings to members of troubled cooperative institutions, immediate arrangements should be made to recover the savings by selling any collateral provided when assets or loans were given to the cooperative. This process should be managed by the committee in charge of the cooperative institution.
The SC’s ruling also includes a judicial remark stating that, despite policy and legal reforms being made to address issues in the cooperative sector, institutional management has not been implemented effectively, and there has been a lack of urgency in the enforcement of the laws.
The ruling states, “To address the long-standing national issue of cooperatives, the amendment to the Cooperative Act on March 2, added Section 103 'A' to establish the NCRA. This NCRA was meant to regulate and supervise savings and loan cooperatives. However, it appears that the formation of this authority has still not been realized.
The decision states that even after the act has been promulgated to effectively begin the process of resolving cooperative problems, the unnatural delay in forming a powerful body, the NCRA, is further complicating the problems of cooperatives.
The failure to form the recommendation committee has also been highlighted as evidence of the government's indifference to the enforcement of the law, as pointed out in the SC's decision.
The ruling states, “According to Section 103 'E', a recommendation committee should be formed to select suitable individuals for the appointment of the Chairperson and members of the NCRA, and recommend them to the government for the formation of the NCRA. However, there is no evidence from the records to show that such a committee has been formed.”
The petitioner, Senior Advocate Dr Surendra Bhandari, stated that the SC's directive has created a space to hold the government accountable as his writ was being issued. He mentioned that, aside from the order to form the recommendation committee within seven days and establish the NCRA within one and a half months, the SC had pointed out many other tasks that the government needs to complete. Bhandari further emphasized that the lack of implementation of these tasks has broadened the path for approaching the court.
The writ was filed by Senior Advocates Bhandari, Dhruva Lal Shrestha, Advocate Bhadra Prasad Nepal, Bola Ram Pandey, Amrit Kharel, and Diksha Katwal, along with retired Brigadier General of the Nepal Army Bharat Bahadur Rayamajhi, who is also an advocate.
