A. M. AHMADI, J. ( 1 ) THE short question which arises for consideration in this petition is whether the power to grant exemption under section 161 of the Gujarat Co-operative Societies Act 1961 (hereinafter called the Act) can be exercised retrospectively In order to answer this question a few relevant facts may be stated. The petitioner a Co-operative Bank registered under the provisions of the Act had advanced loans to respondents Nos. 4 to 6 which are Service and Credit Societies also registered under the Act. The said three Societies were directed to be would up under sec. 107 (3) of the Act and the petitioner Bank was appointed the Liquidator of the said Societies. Under sub-sec. (1) of sec. 114 of the Act the winding up proceedings of a society have to be closed within three years from the date of the order of the winding up unless the period is extended by the Registrar Which shall not exceed four years in the aggregate. It further provides that immediately after the expiry of seven years from the date of the order for winding up the liquidation proceedings shall be deemed to have been terminated and the Registrar shall pass an order terminating the same. In the instant case the winding up orders were passed in respect of respondent No. 4 on 28/04/1967. in respect of respondent No. 5 on 20/06/1967 and in respect of respondent No. 6 on 12/12/1967. Admittedly the Liquidator did not submit a report to the Registrar for the termination of the liquidation proceedings within the statutory period and therefore by virtue of the proviso to sec. 114 (1) of the Act the liquidation proceedings were deemed to be terminated and an order to that effect was passed by the Registrar on 1/09/1976 in respect of respondents Nos. 4 to 6 and certain other Co-operative Societies terminating the liquidation proceedings and for cancellation of the certificate of registration of the said Societies. Against this order the petitioner Bank filed a revision application under sec. 155 of the Act wherein it was inter alia contended that the State Government should exercise power under sec. 161 on the Act. the said revision application was rejected as is clear from the letter written to the petitioners advocate dated 21/11/1977 Annexure J to the petition. Against this order the petitioner Bank filed a revision application under sec. 155 of the Act wherein it was inter alia contended that the State Government should exercise power under sec. 161 on the Act. the said revision application was rejected as is clear from the letter written to the petitioners advocate dated 21/11/1977 Annexure J to the petition. The petitioner Bank has therefore filed this petition for quashing the order of 1/09/1975 (Annexure `i to the petition) and for such other consequential reliefs as may ensue therefrom. ( 2 ) SEC. 107 empowers the Registrar to make an order directing that a society he wound up and to appoint a Liquidator of such Society under sec. 108 of the Act. The order passed by the Registrar can be tested in appeal under sec. 109 of the Act. The powers of the Liquidator have been catalogued in clauses (a) to (o) of sec. 110 of the Act. Section 113 provides that the accounts maintained by the Liquidator shall be audited in the manner the Registrar considers fir. Sec 114 (1) with which we are concerned next provides as under:"114 The winding up proceedings of a society shall be closed within three years from the date of the order of the winding up unless the period is extended by the Registrar. Provided that the Registrar shall not grant any extension for a period exceeding one year at a time and four years in the aggregate and shall immediately after the expiry of seven years from the date of the order for winding up of the society deem that the liquidation proceedings have been terminated and pass an order terminating the liquidation proceedings". It is clear on a plain reading of this provision that the winding up proceedings come to an end within three years from the date of winding up unless the period is extended which shall not in the aggregate exceed four years. In other words the initial period of three years and the extended period should not exceed seven years in the aggregate. On the completion of seven years period from the date of the order of winding up of the society the Registrar shall deem that the liquidation proceedings have terminated and pass an order in that behalf. In other words the initial period of three years and the extended period should not exceed seven years in the aggregate. On the completion of seven years period from the date of the order of winding up of the society the Registrar shall deem that the liquidation proceedings have terminated and pass an order in that behalf. Therefore on the expiry of the initial period of three years or the extended period not exceeding seven years in the aggregate from the date of the order of winding up of the society the Register must deem that the liquidation proceedings have terminated and pass an order accordingly. On the efflux of time therefore the statute intervenes and by fiction the liquidation proceeding terminate and the Registrar is obliged to pass an order terminating the liquidation proceedings. In the instant case also as the liquidation proceedings were not completed within the initial period extensions were sought from year to year and were granted for four years in the aggregate and on the expiry of the extended period that is on the expiry of seven years from the date of the order of winding up of the society the Registrar passed the impugned order on 1/09/1970 (Annexure `i) terminating the liquidation proceedings. There can be no doubt that in view of the language of the proviso to sub-sec. (1) of sec. 114 of the Act it was imperative on the part of the Registrar on the expiry of the total period of seven years from the date of the order of winding up of the three societies in question to deem the liquidation proceedings to have come to an end and to pass an order of termination thereof. The order passed by the Registrar on 1/09/1976 is therefore strictly in conformity with the requirement of sub-sec. (1) of sec. 114 of the Act. The validity of such an order by which the liquidation proceedings came to be terminated cannot therefore be doubted. ( 3 ) AGAINST this order of 1/09/1976 the Bank which was appointed Liquidator in respect of the three societies in question preferred a revision application as provided by sec. 155 of the Act. By the said revision application the Bank as Liquidator requested the State Government to invoke the power conferred upon it by sec. 161 of the Act. ( 3 ) AGAINST this order of 1/09/1976 the Bank which was appointed Liquidator in respect of the three societies in question preferred a revision application as provided by sec. 155 of the Act. By the said revision application the Bank as Liquidator requested the State Government to invoke the power conferred upon it by sec. 161 of the Act. We may therefore look to the said provision which reads as under:-"161 The State Government may by general or special order to be published in the official Gazette exempt any society or class of societies from ally of the provisions of this Act or may direct that such provisions shall apply to such society or class of societies with such modifications not affecting the substance thereof as may be specified in the order: provided that no order to the prejudice of any society shall be passed. without an opportunity being give to such society to represent its cases". This section therefore empowers the State Government to exempt any society or class of societies from any of the provisions of the Act or to direct that such provision shall apply to such society or class of societies with such modifications not affecting the substance thereof. By this provision wide powers have been conferred on the State Government to exempt any Society or class of Socities from any of the provisions of the Act or to modify the said provisions in their application to such society or class of societies provided the substance thereof remains unaffected. There can be no doubt that the power conferred by this provision could have been exercised by exempting the three respondent societies from the operation of sec. 114 (1) of the Act before the statute operated on the efflux of the period of seven years from the date of winding up of each society. The Bank however contends that notwithstanding the efflux of the period of seven years and the consequences flowing therefrom by virtue of the proviso to sub-sec. (1) of sec. 114 of the Act it was open to the State Government to invoke the provision of sec. 161 with a view to exempting the concerned respondent societies from the operation of sec. 114 of the Act. In other words. the contention urged is that the power to exempt contained in sec. 161 can he invoked even retrospectively. if need be. 114 of the Act it was open to the State Government to invoke the provision of sec. 161 with a view to exempting the concerned respondent societies from the operation of sec. 114 of the Act. In other words. the contention urged is that the power to exempt contained in sec. 161 can he invoked even retrospectively. if need be. ( 4 ) IT is a well settled rule of construction that the statute operates prospectively unless the Legislature by express words or necessary implication manifests an intention that it should operate retrospectively. There are no express words in sec. 161 to suggest that it was intended to operate retrospectively. The power conferred by sec. 161 is not confined to the exemption tn be granted insofar as the operation of sec. 114 (1) is concerned but it is an all pervading power to exempt any society or class of societies from the operation of any of the provisions of the Act. In the absence of express words manifesting an intention that the said power can be exercised retrospectively Courts would be slow to widen the scope of such a provision by holding that such power can be exercised retrospectively also. Even in the absence of express words suggesting retrospective operation the Court may attribute such an intention to the Legislature if such an intention can be culled out by necessary implication. Sec. 161 which stands by itself is no doubt intended to exempt any society or class of societies from the provisions of the Act but can it be argued that even after a given provision has exhausted itself vis-a-vis the said society or class or societies the power can be exercised to exempt it from a back date so as to nullify the statutory effect ? To be precise by virtue of the application of sub-sec. (1) of sec. 114 of the Act certain consequences ensued on expiry of the aggregate period of seven years namely termination of the liquidation proceedings. Can this statutory effect or consequence which ensued on the expiry of the prescribed period be rendered nugatory by the State Government by invoking sec. 161 of the Act ? On the termination of liquidation proceedings the Registrar is duty bound to take further action in the matter and if the power under sec. Can this statutory effect or consequence which ensued on the expiry of the prescribed period be rendered nugatory by the State Government by invoking sec. 161 of the Act ? On the termination of liquidation proceedings the Registrar is duty bound to take further action in the matter and if the power under sec. 161 can be exercised retrospectively not only the termination order but all subsequent actions taken pursuant thereto would be rendered nugatory. Such an intention does not appear on the plain language of sec. 161 of the Act. As stated earlier sec. 161 which is of general application empowers the State Government to exempt any society or class of societies from any of the provisions of the Act. Such a wide power conferred on the State Government must be circumscribed and unless there are express words or other circumstances giving rise to the necessary implication that the Legislature intended that the provision may have retrospective effect it would not be prudent to clothe the State Government with power which would render certain statutory effects or consequences nugatory. If the provision is interpreted as suggested by learned counsel for the petitioner the power can be exercised at any time after the termination of the winding up proceedings even after the winding up is complete. Such a far reaching power cannot be read in sec. 161 of the Act. The power has to be exercised before the statutory consequence set out in the proviso to sec. 114 takes effect. Once the statutory consequence namely fiction of the liquidation proceedings having terminated takes place and the order terminating the liquidation proceedings is passed the provision is exhausted and there can be no point in exempting any society or class of societies from that provision thereafter. To permit its retrospective exemption would tantamount to permitting undoing of what the Legislature intended to do by the deeming fiction. I am therefore of the opinion that the contention that the State Government committed an error in refusing to exercise power under sec. 161 of the Act on the plea that it cannot be exercised retrospectively is without merit. ( 5 ) MR. Joshi the learned advocate for the petitioner contended that since the Act was a welfare legislation it should be given retrospective operation. 161 of the Act on the plea that it cannot be exercised retrospectively is without merit. ( 5 ) MR. Joshi the learned advocate for the petitioner contended that since the Act was a welfare legislation it should be given retrospective operation. In support of this contention he placed reliance on the observations of the Supreme Court in paragraph 11 of its judgment in Registrar Co-operative Societies 17. K. Kunjabmu A. I. R. 1980 S. C. 350. However there cannot be a straight jacket formula that every welfare legislation must necessarily be retrospective in effect. The Court must look to the language setting context and purpose or object for which the said provision was introduced on the statute book. I have pointed out earlier that if the power conferred by sec. 161 were to be exercised retrospectively it would render nugatory certain statutory consequences which the legislature intended to follow on the expiry of the period stipulated in sec. 114 of the Act. In the view that I am taking. I find myself fortified by a decision of the Full Bench of the Madhya Pradesh High Court in Collective) Farming Society v. State A. I. R. 1974 M. P. 59. While dealing with sec. 91 of the Madhya Pradesh Co-operative Societies Act 1961 which is substantially the same as sec. 161 of the Act with which we are concerned the Full Bench held that the said power could not be exercised with retrospective effect. In paragraph 37 of the judgment Dayal J. . speaking for the Full Bench observed as under:-"when power is delegated to an authority by the legislature such authority has no power to exercise it with retrospective effect". These observations support the view I have taken. Besides in the context of sec. 114 (1) of the Act it is difficult to understand why the State Government should invoke sec. 161 retrospectively because the ultimate objective for the same would be to bring about regular termination of the liquidation proceedings which is achieved by the friction engrafted in the former provision. ( 6 ) IT was however submitted by Mr. Joshi the learned advocate for the petitioner that the Bank had written to the District Registrar to move the Government for exercise of power under sec. 161 of the Act before the expiry of the period of seven years from the date of winding up. ( 6 ) IT was however submitted by Mr. Joshi the learned advocate for the petitioner that the Bank had written to the District Registrar to move the Government for exercise of power under sec. 161 of the Act before the expiry of the period of seven years from the date of winding up. It appears that in respect of respondents Nos. 4 and 5 Societies the Bank had written a letter on 19/01/1974 and in respect of respondent No. 6 Society on 30/07/1974 a few months before the expiry of the period of seven years for exercise of power under sec. 161 of the Act. It is not known whether the District Registrar forwarded the proposal to the State Government but the fact remains that the State Government did not grant exemption from the application of sec. 114 (1) of the Act in respect of the three societies in question. Whether or not to exercise power depends on the satisfaction of the authority on which the power is conferred. If the District Registrar forwarded the proposals to the State Government then the only inference is that the State Government did not consider it lit to exercise power under sec. 161 of the Act. If the District Registrar failed to forward the proposal to the State Government the fault would not lie at the door of the State Government for failure to exercise power under sec. 161 of the Act and if it cannot exercise the same retrospectively once the stipulated period expired by efflux of time it will serve no purpose now to consider what weighed with the Government in not exercising power under sec. 161 of the Act or with the District Registrar. Bhavnagar in not forwarding the proposal to the State Government for the exercise thereof. I am therefore of the opinion that the order passed by the District Registrar is in conformity with the provisions of the Act and is therefore unassailable. ( 7 ) MR. Joshi the learned counsel for the petitioner lastly contended that by the impugned order of 1/09/1976 the District Registrar was in error in directing that the surplus amount as shown in the Liquidators balance sheet of 30/06/1966 should be deposited and the last meeting of the society in question should be called and after having the accounts finally audited steps should be taken for cancellation of the society. He submitted that once the liquidation proceedings terminate by the thrust of the proviso to sec. 114 (1) of the Act the Society revives and it would be left to the said society to decide whether or not it should apply for cancellation thereof. In this connection he also invited my attention to sec. 20 (1) which provides that the Registrar shall make an order cancelling the registration of a society if it transfers whole of its assets and liabilities to another society or amalgamates with such society or divides itself into two or more societies. or its affairs are wound up or it has not commenced business within a reasonable time of its registration or has ceased to function. Relying on sub-sec. (3) of sec. 20 which provides that the society shall from the date of such order of cancellation be deemed (to be dissolved and shall cease to exist as a corporate body Mr. Joshi submitted that an the termination of liquidation proceedings without the final report of the liquidator by mere efflux of time the society revives and would continue to exist till its registration is cancelled under sub-sec. (1) of sec. 20 of the Act. The line of reasoning was that if the society exists de novo proceedings for winding up of the society can be taken notwithstanding the termination of the winding up by virtue of the fiction engrafted in sec. 114 (1) of the Act. ( 8 ) NOW it must be remembered that when liquidation proceedings terminate under the proviso to sec. 114 (1) of the Act by efflux of time it is by virtue of the fiction of law since no final report was received from the liquidator within the time limit fixed by the legislation. It was necessary to create a fiction because the legislature was aware that all formalities for the submis sion of the final report by the liquidator for termination of the winding up proceedings had not been completed. Since termination of the liquidation proceedings in the normal manner as contemplated by the Act could not be achieved within the stipulated time which the legislature considered reasonable it had to step in and provide for fictional termination as if all formalities were completed. It is on the strength of the fiction created by the proviso to sec. Since termination of the liquidation proceedings in the normal manner as contemplated by the Act could not be achieved within the stipulated time which the legislature considered reasonable it had to step in and provide for fictional termination as if all formalities were completed. It is on the strength of the fiction created by the proviso to sec. 114 (1) of the Act that the liquidation proceedings have to be treated as terminated and an order passed to that effect as if the final report of the Liquidator is received by the Registrar. If this is kept in mind it becomes obvious that the District Registrar would be required to direct the convening of the general meeting of the members of the society for the ultimate cancellation of the registration of the society. Once the liquidation proceedings come to an end by virtue of the fiction there can be no question of the winding up proceedings being commenced de novo under sec. 107 of the Act. Such an interpretation would render the fictional termination meaningless. ( 9 ) FOR the above reasons the petition fails and is dismissed. Rule discharged with no order as to costs. Petition dismissed. .