Inquiry clears Manali Hoteliers Association of financial misconduct, but flags procedural lapses

The office of the Deputy Commissioner-cum-Additional Registrar of Societies, Kullu, has declared the extension in the tenure of the managing committee of the Manali Hoteliers Association as illegal and ordered fresh elections to be conducted by December 18. The order issued on December 2 culminated a year-long inquiry launched on complaints by members. It primarily absolved the previous committee of major financial misconduct but highlighted serious procedural failures.

The core issue was the committee’s unilateral decision to extend its term from two to three years; it was elected in September 2021. The inquiry confirmed that while a proposal for this amendment was submitted, it was notified in January 2023. The Deputy Commissioner clarified that amendments were effective only from their notification date, not submission. Consequently, the committee’s two-year term legally ended in September 2023, rendering its continued operation and its subsequent call for elections in September 2024 “illegal and null and void”.

A major point of contention was the allegation of financial irregularities. The inquiry, conducted by the Assistant Registrar of Cooperative Societies, Kullu, brought crucial findings to light. It concluded that no significant financial irregularities or embezzlement were detected. The report attributed the increased expenditure to legitimate causes: Post-Covid staff recruitment, a Rs 1.50 lakh donation to the Chief Minister’s Relief Fund and subscription collection for member relief. All expenditures were found to have been approved in annual general meetings (AGMs).

However, the inquiry exposed critical procedural and governance lapses. The key shortcomings included the failure to issue mandatory 14-day notices for general house meetings, leading to potentially low attendance, and the absence of a formal audit by a chartered accountant. It also noted that some office-bearers continued to function after their tenure had expired. These deficiencies, the report stated, undermined transparency and proper governance.

These findings directly impacted the electoral process. The general body had previously refused to hold elections until several issues were resolved, including the status of members enrolled during the “illegally”-extended period and the eligibility of the 2021 committee to contest again. The inquiry did not find any major fraud but confirmed procedural illegality, thus current order.

The Deputy Commissioner, acting under the Himachal Pradesh Societies Registration Act, 2006, and on the High Court of Himachal directives, appointed the Tehsildar, Manali, as administrator. The Tehsildar convened a general house meeting on December 10, presented the inquiry findings and scheduled fresh elections by December 18. All actions and decisions taken by the committee during its unauthorised third year had been declared legally void.

The order mandated the future governing body to ensure timely audits and undergo mandatory training in financial and society rules.