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1989 DIGILAW 56 (ORI)

S. v. NARAYANA VS ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES

1989-02-22

A.K.PADHI, G.B.PATNAIK

body1989
JUDGMENT : G.B. Pattnaik, J. - The order of the Assistant Registrar of Co-operative Societies, Gunupur, dated 31-1-1986 superseding the Board of Management of Bissam-Cuttack Large-Sized Multi-Purpose Co-operative Society limited in exercise of his powers u/s 32 of the Orissa Co-operative Societies Act (hereinafter referred to as the "Act") is under challenge in this writ application. 2. The Petitioner's case is that the society in question constituted its managing committee in accordance with the provisions contained in Section 28 of the Act and the Petitioner was the President of the said society. While the committee was so functioning, all on a sudden, the impugned letter of the Assistant Registrar was served. Before passing the order under Annexure-1. the provisions of Section 32 of the Act have not been complied with, inasmuch as no show-cause notice had been issued and also there had been no consultation with the financing bank as required under Sub-Section (4) of Section 32. 3. Though the writ application has been filed as early as in February, 1986, and was admitted on 21-2-1986, yet no counter affidavit has been filed on behalf of opposite party No. 1, the Assistant Registrar, for whom the learned Additional Standing Counsel has entered appearance. The order of the Assistant Registrar under Annexure-1 indicates that out of the eight directors of the society, five have resigned and the rest three do not form the quorum and it is for that reason the Assistant Registrar has exercised his power of supersession u/s 32(1) lit the Act. 4. A counter affidavit has been filed on behalf of opposite parties 6, 7 and 11 stating therein that though they had resigned on 11-12-1985, yet they withdrew their letters of resignation before acceptance thereof by the competent authority. The letter at withdrawal of resignation has been annexed as Annexure-A/6. In the absence of any counter affidavit on behalf of opposite party No. 1, the assertions made in the counter-affidavit of opposite parties 6, 7 and 11 must be held to be correct and hence there was no resignation on behalf of the five of the directors as contained in the order of the Assistant Registrar in Annexure-1. Thus the basis on which the Assistant Registrar has purported to exercise his jurisdiction u/s 32(1) of the Act falls through. Thus the basis on which the Assistant Registrar has purported to exercise his jurisdiction u/s 32(1) of the Act falls through. That apart, Section 32(1) of the Act does not authorise the Registrar to supersede a managing committee for resignation of some of the members of the society. The powers of supersession can be exercised only if the Registrar is of the opinion that the committee makes persistent default or is negligent in performing its duty imposed by the Act or the Rules or the Bye-laws or it is prejudicial to the interests of the society or its members or is otherwise not functioning properly. To meet the contingency of resignation of some members of a society Section 28(6) provides the remedy According to Sub-Section (6) of Section 28 where a vacancy in the office of a member or the President of a Committee arises by reason of death, resignation or removal of any member of the President or by withdrawal of its representative by a member-society, such vacancy has to be filed up in the same manner as it was originally filed up. Therefore, even if there would have been a resignation, it could have been filled up in accordance with Sub-Section (6) of Section 28 of the Act. We also further find that the mandatory requirement of Sub-Section (4) of Section 32 has not been complied with inasmuch as there has been no consultation with the financing bank Consequently the order passed under Annexure-1 cannot be sustained and is hereby quashed. The writ application is accordingly allowed, but in the circumstances without any order as to costs. A.K. Padhi, J. 5. I agree. Final Result : Allowed