Niyamat Ali v. Sirohi Distt. Commercial Co-operative Bank Ltd.
1993-08-17
J.R.CHOPRA, RAJENDRA SAXENA
body1993
DigiLaw.ai
Honble SAXENA, J.—This Special Appeal has been directed against the order dated 20-4-1993 passed by the learned Single Bench of this Court in S.B. Civil Writ Petition No. 3529 of 1992, whereby the petitioners writ petition has been found meritless and the same has been dismissed. 2. The appellant filed the writ petition with the averments that he is a Member of the respondent—Co-operative Bank; that the respondent Bank is a State instrumentality within the meaning of Art. 12 of the Constitution of India and that the Registrar, Co-operative Societies and other Authorities exercise control on its day to day affairs. It was averred that the respondent Bank is governed by Bye-laws and Clause III thereof says that its area of operation shall be confined to District Sirohi and that for any revision in this regard, prior approval in writing of the Reserve Bank of India as also of the Registering Authority shall be necessary. It was the case of the petitioner that at the time of enrolment of his membership in the year 1987, he was residing in village Basan, Tehsil Reodar of District Sirohi and that now he has shifted to Abu Road, which is an urban area. It was alleged that the Asstt. Registrar, Co-operative Societies, Sirohi vide his order dated 8-6-1992 (Annex. 1) amended clause III of the Bye-laws whereby area of operation of the respondent Bank was confined to Municipal limits, urban and semi-urban centres of District Sirohi and the rural areas have now been excluded from its area of operation. It was the case of the petitioner that after the said amendment in Clause III of the Bye-laws, the election process for re-election of the Directors of the respondent Bank commenced in the month of June, 1992 i.e. after he had submitted his nomination from Abu Road constituency; that his nomination form was found to be valid and his name appeared at S. Nos. 6 and 7 in the list of valid nomination papers dt. 10-6-1992 (Annex. 2) and that thereafter the elections were held on 17-6-1992 and he was declared duly elected as a Director from Abu Road constituency vide order dt. 18/6/1992 (Annex. 3). The meeting of the Board of Directors took place on 2.7.1992, wherein vide resolution No. 9 (Annex. 5), the implication of the amendment of Clause III of bye laws vide order dated 8 6.1992 (Annex.
18/6/1992 (Annex. 3). The meeting of the Board of Directors took place on 2.7.1992, wherein vide resolution No. 9 (Annex. 5), the implication of the amendment of Clause III of bye laws vide order dated 8 6.1992 (Annex. 1) was considered and it was resolved to ascertain about the areas of Sirohi District which were categorised as Urban or Semi-urban as per census held in the year 1991. It was further resolved that a list of members of the respondent Bank belonging to village areas should be prepared against whom Bank loans were outstanding as also the list of those members against whom there were no such dues. It was also resolved that those lists should be placed before the Board of Directors in the next meet-ting. It was further resolved that the guidance should also be sough from the Co-operative Department for adopting the procedure for relieving the members belonging to the rural area. The Chairman of the Board (respondent No. 2) had also informed in the said meeting that the previous Board of Directors had filed a writ petition in this Court through one Ishwar Singh challenging the proposed amendments in the bye laws. But, instead of complying with the resolution Annex. 5, respondent No. 2 got published a notice dated 3/7/1992 in the Rajasthan Patrika notifying that the membership of these share holders of the respondent Bank, who belonged to the rural areas and against whom no bank due was outstanding, had automatically come to an end and directed such shareholders to submit their share certificates within a month so that their share amount be refunded, failing which their share amount shall stand forfeited. It was the case of the petitioner that respondent No. 2 with an ulterior motive to deprive him from discharging his duties as Director of the respondent Bank issued the said notice Annex. 6, which was unauthorised and against the resolution Annex. 5 passed by the Board of Directors. The petitioner asserted that since he resided in Abu Road and had contested the election from Abu Road constituency, his membership could not be put to an end.
6, which was unauthorised and against the resolution Annex. 5 passed by the Board of Directors. The petitioner asserted that since he resided in Abu Road and had contested the election from Abu Road constituency, his membership could not be put to an end. He further contended that more than thousands of members belonging to the rural area were eligible to vote and contest the election, that such electorate constituted a major portion of the electoral roll and that they had casted their votes to the candidates, who belonged to the Municipal/urban area. In such circumstances, if it was held that the members of the respondent Bank, belonging to the rural areas of the District Sirohi could not participate in the election then the whole election shall become illegal. Moreover, the amendment in the bye-laws of the Bank does not have the retrospective effect. In such circumstances, the action of the respondent No. 2 in issuing Annex. 6 was totally malafide and arbitrary. According to the petitioner, the office of the Director can only become vacant in accordance with the Clause 32 of the Bye laws, but no such contingency as enumerated in the said clause has arisen with regard to him. It was further contended that by mere change in the operation of area, members of the respondeat Bank belonging to the erstwhile operation area cannot cease to be member of the Bank and that their membership can only cease according to the provisions of clause 14 of the bye-laws. According to him, the implication of the amendment in the bye-laws sought by order Annex. 1, is only this that now new-members cannot be enrolled from the excluded area, because the application of such amendment is only prospective and not retrospective. The petitioner, therefore, prayed that by an appropriate writ, order or direction the respondents be restrained from removing his name from the membership of the respondent Bank and from the Directorship by declaring the seat held by him as vacant. 3. The respondents in their reply dated 22.11.1992 stoutly resisted the writ petition on every conceivable ground along with certain preliminary objections.
3. The respondents in their reply dated 22.11.1992 stoutly resisted the writ petition on every conceivable ground along with certain preliminary objections. First preliminary objection was that neither the respondent Bank has taken any loan from the State nor the State has any share or financial investment in the Bank and therefore, the respondent Bank does not come within the ambit of the State as provided under Art. 12 of the Constitution of India and the writ petition was not maintainable. Another preliminary objection was that since the petitioner has challenged his removal from the Executive Committee and primary membership of the Society, the impugned notification Annex. 1 and orders/decisions of the respondent Bank, which is a registered Cooperative Society, are appealable before the Registrar Cooperative Societies and, therefore, the writ petition was not maintainable. On merits, it was asserted that the petitioner being a member of the respondent Bank from village Basan, which is a rural area and which has now been excluded from the operation of the area of the Bank by the amendment in Clause III of the Bye-laws vide order dated 8/6/1992 (Annex. 1), has automatically ceased to be its member and Director. It was denied that the petitioner has now shifted to Abu Road and residing there. It was maintained that previously Tehsil Reodar, wherein village Basan, is situated and tehsil Abu Road, was the area for operation of the Abu Road branch of the respondent Bank and, therefore, petitioners nomination paper from the Abu Road constituency was found to be valid. It was also admitted that the petitioner was declared elected as Director vide Annex. 3 and that guidelines were sought from the Cooperative Department for adopting the procedure as to how the members of the respondent Bank belonging to the rural area of District Sirohi should be removed. It was asserted that notice Annex. 6 was issued by the respondent Bank without any malafide and /or ulterior motive and that the said notice was general in nature and concerned with all those share holders who belonged to the rural areas. It was further asserted that the petitioner in his application form for membership dated 18/12/1986 (Annex.
It was asserted that notice Annex. 6 was issued by the respondent Bank without any malafide and /or ulterior motive and that the said notice was general in nature and concerned with all those share holders who belonged to the rural areas. It was further asserted that the petitioner in his application form for membership dated 18/12/1986 (Annex. R/l), had specifically given his residential address as village Basan Tehsil Reodar and not that of Abu Road and that since the rural areas of District Sirohi have been excluded from the operation area of the Bank, all those members and share holders residing in rural areas have now ceased to be its members and that the petitioner was continuing as its member in pursuance of this Courts ad interim stay order. It was submitted that the removal of the member and the cessation of member are two different aspects but due to the amendment in Clause III of the Bye-Laws vide order Annex. 1, the petitioner, who belongs to the rural area, has ceased to be the member of the respondent Bank. 4. The petitioner in his rejoinder dated 16.2.1993 reiterated that the respondent Bank is a State instrumentality within the meaning of Art. 12 of the Constitution and that it has also received subsidies of Rs. 10000/- in the years 1982-83, 1983-84 and 1984-85. However, he did not file any document in support of this contention. He further contended that as per provisions of the Bye-laws, the Govt. of Rajasthan may be admitted as member of the respondent Bank, that three Directors are to be nominated by the Registrar, Cooperative Societies and that as per sub-clause (xiv) of Cl.
However, he did not file any document in support of this contention. He further contended that as per provisions of the Bye-laws, the Govt. of Rajasthan may be admitted as member of the respondent Bank, that three Directors are to be nominated by the Registrar, Cooperative Societies and that as per sub-clause (xiv) of Cl. 36, prior approval of the Registrar, Co-operative Societies is essential for taking any disciplinary action against the Chief Executive Officer as also to create posts of Officers, juniors and other staff on the bank establishment and to frame rules prescribing procedure for filling the vacancies; that it is obligatory upon the Bank to have one nominee of the Registrar, Cooperative Society in the Staff Committee and that for payment of compensation, advance, rent, long term advance, securing premises for the Bank, prior approval of the Registrar is necessary and that as per Clause 48, the account of the respondent Bank is required to be audited by the auditors appointed by the Registrar and that any amendment in the bye laws is also subject to the approval of the Registrar. Therefore, it is the obligatory duty of the Registrar, Cooperative Societies to exercise his effective control over the respective Bank. Hence, the respondent Bank is State instrumentality and as such the writ petition was maintainable. It was also alleged that the respondents have concealed material facts in as much as that they issued letter dated 3.7.1992 Annex. 8 addressed to the petitioner but the same was not posted to him purposely and that he came to know about the said letter in the month of Feb. 1993 from the office of the Asstt. Registrar, Cooperative Societies, wherein it was mentioned that the petitioner had ceased to be a member as also the Director of the respondent Bank. The petitioner also submitted memorandum of agreement for Petrol/HSD Pump Dealership dt. 3/8/1991 executed by him and the Indian Oil Corporation for carrying on business of petrol pump in the name of M/s Maharani Petroleum, Sarupganj, which is a Municipal area and letters dt. 2.7.1992 (Annex. 10), 30.7.1992 (Annex. 11) and letters dt. 11.12.1992 and 27.1.93 (Annexs. 12 and 13) respectively issued by the respondent Bank to him on his Abu Road address to show that he was residing at Abu Road.
2.7.1992 (Annex. 10), 30.7.1992 (Annex. 11) and letters dt. 11.12.1992 and 27.1.93 (Annexs. 12 and 13) respectively issued by the respondent Bank to him on his Abu Road address to show that he was residing at Abu Road. He also filed a certificate of membership of the Lions Club of Abu Road issued by the International Association of Lions Club in his favour. 5. After hearing the parties at length, the learned Single Judge did not like to decide the preliminary objection regarding the maintainability of the writ petition on the ground whether the respondent Bank is a State within the meaning of Art. 12 of the Constitution or not. On the other hand, the learned Single Judge held that since the area of operation of the respondent Bank has been confined to urban and semi urban areas and the rural areas have been excluded from its area of operation and therefore the petitioner cannot be allowed to continue as a member of the respondent Bank and for that matter as its Director. Hence he dismissed the writ petition. 6. In this appeal, an ad interim order dated 6.5.1993 was passed to the effect that if any co-option of the Directors was in the respondent Bank, the result thereof shall not be declared and the same shall be subject to the decision of this appeal. On 12-5-1993 arguments were heard and order was reserved. 7. However, on 17.5.1993 the respondents filed an application for taking documents Annexs. R/2 to R/4 on record. It was also mentioned in that application that after writ petition was dismissed on April 20, 1993 by the learned S.B. and before this Special Appeal was filed, the Managing Director of the respondent Bank, in compliance of the order of the statutory authority viz, Joint Registrar (Banking) Cooperative Societies, Raj. Jaipur dt. 14.9.92 (Annex. R/2) had issued letter dated 29.4.1993 Annex. R/4 to the petitioner informing him that his membership from the respondent Bank has come to an end and that his share amount has been deposited in the Sundry creditors account, which he should take back after depositing his share certificate. The respondent Bank has now contended that since the said order dt. 29.4.1993 (Annex. R/4) has not been challenged by the petitioner, this Special Appeal has become infructuous, It was ordered by this Court that the said application will be decided while passing the judgment.
The respondent Bank has now contended that since the said order dt. 29.4.1993 (Annex. R/4) has not been challenged by the petitioner, this Special Appeal has become infructuous, It was ordered by this Court that the said application will be decided while passing the judgment. 8. We have heard learned counsel for the parties at length and perused the relevant record in extenso. 9. Mr. B.R. Mehta, learned counsel for the respondents, has strenuously contended that since the respondent Bank is not an instrumentality of the State under Art. 12 of the Constitution, this writ petition is legally not maintainable. For this, he has placed reliance on the case of Bhagwan Dass vs. Railway Shramik Sahakari Bank Ltd. (1), wherein a learned S.B. of this Court after referring catena of cases decided by the Apex Court has held that the Railway Shramik Sahakari Bank is not a State or other Authority within the meaning of Art. 12 of the Constitution because the State control over such a bank is not deep and pervasive. Accordingly, the said writ petition filed against Railway Shramik Sahakari Ltd. was dismissed. 10. Mr. B.R. Mehta has placed reliance on the Full Bench decision of the Bombay High Court passed in Shamrao Vithal Cooperative Bank Ltd. vs. Padubidri Pattabhiram Bhat(2). In that case, it has been held that a Cooperative Society registered under the provisions of Maharashtra Cooperative Societies Act, 1960 and under the Multi-State Cooperative Societies Act, 1984. which carries on the business of banking, and is therefore, governed by the Banking Regulation Act, 1949, does not thereby fall within the expression State under Art. 12 of the Constitution of India. It has been further held that the manner in which an organisation is created is not of any direct relevance; that what is required to be seen is whether there is pervasive State control over its management and functioning and that merely because an organisation performs functions of public importance, it cannot be held that such an organisation falls within the meaning of State under Art. 12.
It was observed that the regulatory laws are enacted to cover a large number of organizations, that the laws which regulate functioning of such organisations are presumably enacted in public interest but this does not mean that any of these organisations, if they perform public functions, automatically become State under Art. 12 of the Constitution, It was further observed that every organisation which carries-out a function, which is of public importance, does not necessarily become State under Art. 12 and that conferment of State hoods depends upon various other factors also such as the nexus of such organisations with the extent of State control, whether it is entirely financed by the State or by private individuals, whether the same function was originally carried out by a department of the State and so on. It was stressed that there may be many functions of public importance which can be performed by private organisation also. The Bombay High Court, therefore held that Shamrao Vithal Co-operative Bank Ltd. was not the State within the meaning of Art. 12 and the writ petition was not maintainable. 11. On the other hand, Mr. Vijay Mehta, learned counsel appearing for the petitioner, has cited the following cases : Andi Mukta Sadguru Shree Muktajee Vandas Swami Suvarna Jayanti Mahotsav Smarak Trust vs. V.R. Rudani (3), Raj Soni vs. Air Officer Incharge, Administration (4), Rajasthan Co-operative Dairy Federation Ltd. Jaipur vs. Manoharlal Sharma (5), and Hardeo Lal Jat. vs. Alwar Sahakari Bhumi Vikas Bank Ltd. (6), in support of his contention that the respondent Bank is a State instrumentality wherein the Registrar, Cooperative Societies has the effective control on the day to day business of the respondent Bank. 12. The learned Single Judge did not like to decide this preliminary objection about the maintainability of writ petition. He, however dismissed it on merits. The learned counsel for the respondent Bank has vigorously insisted that the preliminary objection about the maintainability of the writ petition should be decided first of all, because it pertains to the jurisdiction of the Court. We, therefore, embark upon to decide this controversy in the first instance. 13. In Ramana Dayaram Shetty v. The International Airport Authority of India (7), the Apex Court has considered the question when a corporate body can be construed as State" or instrumentality or agency of the State within the meaning of Art. 12 of the Constitution.
We, therefore, embark upon to decide this controversy in the first instance. 13. In Ramana Dayaram Shetty v. The International Airport Authority of India (7), the Apex Court has considered the question when a corporate body can be construed as State" or instrumentality or agency of the State within the meaning of Art. 12 of the Constitution. The Honble Supreme Court vide para 19 has observed as under:- "19. It will thus be seen that there are several factors which may have to be considered in determining whether a corporation is an agency or instrumentality of Government. We have referred to some of these factors and they may be summarised as under : whether there is any financial assistance given by the State, and if so, what is the magnitude of such assistance whether there is any other form of assistance given by the State, and if so, whether it is of the usual kind or it is extraordinary, whether there is any control of the management and policies of the corporation by the State and what is the nature and extent of such control, whether the corporation enjoys State conferred or State protected monopoly status and whether the function carried out by the corporation are public function closely related to governmental functions. This particularisation of relevant factors is however not exhaustive and by its very nature it cannot be, because with increasing assumption of new tasks, growing complexities of management and administration and the necessity of continuing adjustment in relations between the corporation and Government calling for flexibility, adaptability and innovative skills, it is not possible to make an exhaustive enumeration of the tests which would invariably and in all cases provide an unfailing answer to the question whether a corporation is governmental instrumentality or agency .....". Applying these tests, it was held that the International Airport Authority of India is a State within the meaning of Art. 12 of the Constitution. 14. In Ajay Hasia vs. Khalid Mujib Sehravardi (8), the S.C. reiterated the tests laid down in the case of Ramana Dayaram Shetty (supra) and observed while stressing the necessity of a wide meaning to be placed on the expression "other Authority" it must be realised that it should not be stretched so as to bring in every autonomous body, which has some nexus with the Govt. with the sweep of the expression "State".
with the sweep of the expression "State". It was held that the Regional Engineering College, Srinagar sponsored by Govt. of India, though established, managed and administered by a Society registered under the J. & K. Registration of Societies Act was an instrumentality of the agency of the State and hence an authority within the meaning of Art. 12 and a writ petition filed against it was maintainable. It further observed that a wide enlargement of the meaning must be tempered by a wise limitation. The Honble Supreme Court has further observed that it is immaterial for this purpose whether a Corporation is created by a statute or under a statute. The test is whether it is an instrumentality or agency of the Govt. and not as to how it is created. 15. In the case of Tekraj Vasandi alias K.L. Basandhi v. Union of India (9), the Apex Court held that the Institute of Constitutional and Parliamentary Studies registered under the Societies Registration Act, 1860 is not "State" within the meaning of Art. 12 and while applying the above tests, it was observed that there cannot indeed be a strait jacket formula and that it is also not necessary that all the tests should be satisfied for reaching the conclusion either for or against holding an institution to be "State". The Honble Supreme Court has also said in the same vein as in Ajay Hasias case (supra) that in a Welfare State, Governmental control is very pervasive and in fact touches all aspects of social existence and that in the absence of a fair application of the tests to be made, there is possibility of turning every non-governmental society into an agency or instrumentality of the State and that obviously would not serve the purpose and may be far from reality. A broad picture of the matter has to be taken and a discerning mind has to be applied keeping the realities and human experience in view so as to reach a reasonable conclusion. 16. In Chander Mohan Khanna vs. The National Council of Educational Research & Training (10), the Apex Court has again reiterated that principle. 17. With this parameters of the settled principles in this regard, let us now examine the constitution and the functioning of the respondent Bank.
16. In Chander Mohan Khanna vs. The National Council of Educational Research & Training (10), the Apex Court has again reiterated that principle. 17. With this parameters of the settled principles in this regard, let us now examine the constitution and the functioning of the respondent Bank. Clause V of its Bye-laws enumerates the objects of the respondent Bank, which inter-alia includes to encourage thrifts, self-help and co-operation among members, to accept deposits of money from the public for the purpose of lending or investment, to borrow or raise money to grant and to issue letters of credit, to negotiate loans and advances, to prepare and to finance schemes for amelioration of the financial conditions of members, to do any other form of business as specified in clause (1) of section 6 of the Banking Regulation Act, 1949 (as applicable to Co-operative Societies) and to undertake any other form of business, which the Central Govt. may specify as a form of business in which it is lawful for a co-operative banking institution to engage. 18. Sub-Clause 6 of its Bye - laws says that funds may be raised by means of shares, entrance fee, subscription, deposits, loans, cash credits, over-drafits and advance, donations, grants & subsidies. Clause 9 deals with the members and says that an individual may be admitted as a member, if be is an adult and competent to contract. It provides that the Govt. of Rajasthan, the Rajasthan State Cooperative Bank Ltd., and the Sirohi Central Cooperative Bank Ltd. may also be admitted as its members. Cl. 19 says that subject to the provisions of the Rajasthan Cooperative Societies Act and the Rules, the final authority of the Bank shall vest in the General body. Cl.20 deals with convening of the annual general meeting, to consider any communication from Registrar and/or Auditor relating to the annual audit, to appoint duly qualified auditor, to elect the members of the Board of Director etc. Cl. 26 pertains to voting rights, which provides that each share-holder member shall have one vole irrespective of the number of shares held and that the Govt., if it is a share holder number, may appoint one of its officers to participate in the meeting and to exercise the right of voting. Thus, the State Govt. has only one vote.
Cl. 26 pertains to voting rights, which provides that each share-holder member shall have one vole irrespective of the number of shares held and that the Govt., if it is a share holder number, may appoint one of its officers to participate in the meeting and to exercise the right of voting. Thus, the State Govt. has only one vote. Cl 27 says that the resolution shall be carried by a majority of votes and that unless specifically directed in this behalf by the Registrar, there shall not be any resolution concerning election of an office bearer. Cl. 29 provides that the Board of Directors shall consist of not more than 15 Directions out of which twelve Directors shall be elected amongst the share holders subject to the minimum one Director from each branch of the Bank and that three Directors shall be nominated by the Registrar, Cooperative Societies, Rajasthan, Jaipur provided the Bank has received any assistance by way of loan, share, capital etc. from the State Govt., Rajasthan State Cooperative Bank Ltd. Jaipur and/or the Central Cooperative Bank of the District. Thus, in the Board of Directors the State Govt. can only nominate three Directors too, when the respondent Bank has received any loan or share capital etc. from the State Govt. Cl. 33 of the Bye-laws deal with the vacancy in the Board of Directors and lays down that vacancies in the Board of Directors occurring through death, removal, resignation or any other reason, shall be filed by the remaining Directors by cooption from amongst the share holders, who have been members for at teast two continuous-years as on the date of cooption. Cl. 36 enumerates the powers of the Board of Directors Sub Cl. (xiv,) thereof lays down that the Board of Directors has the power to consider proposals for creating posts of officers & Junior and other Staff on the banks establishment and to frame rules subject to the prior approval of Registrar regarding procedure for recruitment or promotion fixing their qualifications, scales of pay and other allowances and the prior approval of the Registrar shall be essential for taking disciplinary action against the Chief Executive Officer. Sub Cl. (vv) of Cl. 36 says that subjects to the prior approval of the Registrar, Chief Executive Officer may be appointed by the Board of Directors. Sub-Clause (xvi) of Cl.
Sub Cl. (vv) of Cl. 36 says that subjects to the prior approval of the Registrar, Chief Executive Officer may be appointed by the Board of Directors. Sub-Clause (xvi) of Cl. 36 lays down that Board of Directors has the power to appoint Staff Committee consisting of Chairman, the Chief Executive Officer and three other Directors of which one shall be the Registrars nominee for disposal of all matters concerning the paid staff of the Bank such as selection, appointment, promotions, training disciplinary action etc. as per rules approved or framed by the Registrar. Clauses 39 and 49 deal with the power of the Chairman and Chief Executive Officer, while Clause 41 deals with the details of loans and advances. C1.44 pertains to appropriation of profits. It says that the net profits of the Bank shall be calculated as per the provisions of the Rajasthan Cooperative Societies Act, 1965 and rules framed thereunder. It also deals with the declaration of bad debts, reserve, charity fund etc. 19. Thus, a survey and scanning of the Bye-Laws of the respondent Bank clearly indicate that there is no deep and pervasive control of the State Govt. over the respondent Bank. The supervisory powers given to the Registrar, Cooperative Societies are simply with a view to securing better working of the Societies and to give them guidance of well trained and expert officers, but that by itself, does not make the respondent Bank any instrumentality of the State. The management of the respondent Bank also does not vest in the Govt. or the representative of the Govt. The respondent Bank does not perform such functions of public importance, which are closely related or have any reasonable nexus to the Governmental functions. It rather performs the functions of a commercial bank. Hence by no stretch of imagination, it can be treated as a Govt. agency or "State" or authority under Art. 12 of the Constitution. 20. We also fully agree with the reasonings given by the learned Single Judge in the case of Bhagwan Dass (supra) wherein it has been held that a Cooperative Bank is not a State or other Authority within the meaning of Art. 12 of the Constitution because the State control over such a bank is not deep and pervasive. 21.
20. We also fully agree with the reasonings given by the learned Single Judge in the case of Bhagwan Dass (supra) wherein it has been held that a Cooperative Bank is not a State or other Authority within the meaning of Art. 12 of the Constitution because the State control over such a bank is not deep and pervasive. 21. The Banking Regulation Act, 1949 also does not prescribe any pervasive State control over banks covered by it, which would make such a bank an agency or instrumentality of the State. For this, we place reliance on the case of Shamrao Vithal Cooperative Bank Ltd. and Anr. (supra). 22. We have carefully gone through the case law cited by the learned counsel for the appellant. In Andi Mukta Sadguru Shree Muktajee Vandas Swami Suvarna Jayanti Mahotsav Smarak Trust and Ors. case (supra), the appellant Trust was managing the affiliated College to which public money was paid as Govt. aid and its teachers, whose services were terminated, claimed terminal benefits and arrears of salary by filing a writ petition. It was held by the Apex Court that the public money paid as Govt. aid played a major role in the control or maintenance in working of the educational Institution; that the aided institution like Govt. institutions discharged public functions by way of imparting education to students; that they were subject to the rules and regulations of the affiliating University and that their activities were closely supervised by the University authorities and that as such employment in such institutions was not devoid of any public character and so were the service conditions of the academic staff. In such circumstances, it was held that the appellant Trust was amenable to writ jurisdiction of the High Court under Art. 226 of the Constitution, which confers wide powers to issue writs for enforcement of fundamental rights as will as non-fundamental rights and that the words "any person or authority" used in Art. 226 are, therefore, not to be confined only to statutory authorities and instrumentalities of the State. We respectfully agree with this dictum but in the case in hand, the respondent Bank has not received any substantial loan or substantial financial assistance from the State nor the State has any deep and pervasive control nor the respondent Bank discharges such public functions which are akin to the Govt. functions.
We respectfully agree with this dictum but in the case in hand, the respondent Bank has not received any substantial loan or substantial financial assistance from the State nor the State has any deep and pervasive control nor the respondent Bank discharges such public functions which are akin to the Govt. functions. Therefore, this case does not come to the rescue of the appellant. 23. In Raj Sonis case (supra), the petitioner was retired from the post of teacher in the Air Force Central School on attaining the age of 58 years. The said school was a Society registered under the Societies Registration Act, 1960. The petitioner claimed that under the Delhi Education Code read with the Delhi Education Act, 1973, the age of superannuation for the teachers, who joined service before coming into force the said Act was 60 years and as such the management of the school had acted arbitrarily in retiring her at the age of 58 years and deprived her of two years service and consequential benefits. It was held that the school was bound to provide her the benefit of the uniform age of retirement for such employees but the question about the maintainability of the writ on the ground that such school was a State, was not gone into and left undecided by the Apex Court. Therefore, this case does not assist the petitioner for determining this controversy involved in the case in hand. 24. In the case of Raj. Cooperative Dairy Federation Ltd. Jaipur and Anr. (supra) a Division Bench of this Court has held that the Raj. Cooperative Dairy Federation Ltd. fell within the meaning of the State under Art. 12 and as such it was amenable to writ jurisdiction that the tests laid down in Ramana Daya Ram Shettys case and Ajay Hasias case (supra) were satisfied, that a perusal of its Bye-Laws made it abundantly clear that the principal financier of the Federation was the State Govt. that Directors were nominated by the State Govt. and out of them, one was Chairman and that the Managing Director and the Chief Executive Officer of the Federation were also appointed by the State Govt. Apparently no such control of the State Govt, is discernible from the perusal of the Bye-Laws of the respondent Bank. Therefore, the respondent Bank cannot be equated with the Raj.
and out of them, one was Chairman and that the Managing Director and the Chief Executive Officer of the Federation were also appointed by the State Govt. Apparently no such control of the State Govt, is discernible from the perusal of the Bye-Laws of the respondent Bank. Therefore, the respondent Bank cannot be equated with the Raj. Cooperative Dairy Federation Ltd. Hence, this case also does not render any assistance to the appellant. 25. In Hardeo Lal Jats case (supra), it was not disputed that the entire control and management of the Sahakari Bhumi Vikas Banks in Rajasthan vested in the State Govt. and that the Registrar, Cooperative Societies, Govt. of Raj. was the controlling head of the said Bank. In such circumstances, the said Bank was held to be amenable to the writ jurisdiction. Again, such are not the facts of the case in hand, where the entire control and management of the respondent Bank vests in the General body as per Clause 19 of the Bye Laws of the respondent Bank. Therefore, the facts of Hardeo Lal Jats case (supra) are clearly distinguishable. 26. Hence, for the reasons mentioned above, we are of the considered opinion that the respondent Bank is neither a State instrumentality nor a State agency nor State within the meaning of Art. 12 of the Constitution. It is also not an authority which discharges such public functions which are akin or have reasonable nexus to the Govt. functions. Moreover, the respondent Bank does not have any substantial financial assistance of the State nor its share capital is held by the Govt. nor it enjoys the monopoly status which is State conferred or State protected nor it is under the deep and pervasive State control. Therefore not an iota of doubt lurks into our mind to hold that this writ petition is not maintainable against the respondent Bank under Art. 226 of the Constitution. 27. On merits also, a bare perusal of order dt. 4.6.1992 (Annex. 1) issued by the Asstt. Registrar, Cooperative Societies, Sirohi reveals that after procuring the prior approval in writing of the Reserve Bank of India and after inviting objections in respect of the proposed amendment and after disposing of those objections, the Cl. 3 of the Bye-Laws of the respondent Bank was amended with effect from 4.6.1992.
4.6.1992 (Annex. 1) issued by the Asstt. Registrar, Cooperative Societies, Sirohi reveals that after procuring the prior approval in writing of the Reserve Bank of India and after inviting objections in respect of the proposed amendment and after disposing of those objections, the Cl. 3 of the Bye-Laws of the respondent Bank was amended with effect from 4.6.1992. Therefore, the area of the operation of the respondent Bank was reduced and only confined to the municipal areas and the urban and semi-urban areas of Sirohi district. Thus excluding rural areas of Sirohi district, admittedly the appellant was enrolled as a member residing in the rural area as per his application Annex. R/l. The petitioner did not intimate the respondent Bank about the fact that he had shifted from village Basan and has started residing in Abu Road nor any such change was made in his application form. Simply by shifting to Abu Road and without getting himself enrolled as a member residing in urban area in electoral rolls of the Bank, he cannot be deemed to be a member of the Bank from the urban area of Sirohi district. Since by Annex. 1 from the area of operation of the Bank, the rural/village areas of Sirohi District was excluded w.e.f. 4.6.1992, the petitioner appellant ipso facto ceased to be the member of the respondent Bank as also its Director. Moreover, against order Annex. 1, the appellant has an alternative and effective remedy by filing appeal before the Registrar, Cooperative Societies under the provisions of Raj. Cooperative Societies Act. Therefore, refracted from any angle, in our considered opinion, there is no error apparent or any valid reason warranting any interference in the impugned order dt. 20.4.1993 of the learned S.B. 28. The result of the above discussion is that this appeal is devoid of any force and the same is hereby dismissed. However; the appellant shall be at liberty to seek his remedy before the appropriate authority under the Raja-sthan Cooperative Societies Act or before any Civil Court of competent jurisdiction for redressal of his rights, if any, in accordance with law. No order as to costs.