Sundaram Pillai v. Joint Registrar — 1995 DIGILAW 30 (KER)

JUDGMENT V. V. Kamat, J. 1. Only yesterday in O. P. No. 12191 of 1994, I had occasion to emphasise the importance of the democratic process in the affairs of the conduct of the cooperative societies with reference to the provisions of the Kerala Cooperative Societies Act, 1969 in the following manner: "The entire emergence of the cooperative movement pre-supposes the urgency and continuance of the democratic process in the affairs of the cooperative societies. This golden thread is also available throughout the various provisions of the Act (namely the Kerala Cooperative Societies Act, 1969). In fact S.27 floats on the surface of the situation when it deals with the question of final authority in any cooperative society, legislating it to be vesting in the General Body of all the members. It is made clear, in addition that by an amendment relating to its constitution a smaller body consisting of such members of the society could be prescribed, elected in accordance with the rules and bye laws of the said society in question. S.28 of the Act also enjoins the general body of a society for constitution of committee giving it a statutory life of three years, in accordance with the bye laws and entrust the management of the affairs of the society to such committee. The Act in question also provided for the constitution of the initial committee at the time of the registration of the society to conduct the affairs of the society for a period of three months. Elaborate provisions are also made by the statute with regard to what is to be done in the event of the committee in question completing three years or more. In other words, it is understood statutorily that a committee completing three years or more ceases to be in existence and it is then provided that in such a situation the Registrar Shall appoint either a new committee of not more than three members from among the members of the society or one or more Administrator or Administrators and these Administrators, it is provided, need not be members of the society in question. The provisions of the statutes [section 28 (1A)] also deals with the accuracy of time with regard to its life when it is enacted that in the event of the committee is ceasing to be in existence, it cannot have more life exceeding one year. The provisions of the statutes [section 28 (1A)] also deals with the accuracy of time with regard to its life when it is enacted that in the event of the committee is ceasing to be in existence, it cannot have more life exceeding one year. It is also made clear that statutorily this arrangement shall be subject to the control of the Registrar of the Societies. 2. In other words, the basic fabric of the democratic process relating to the working of a cooperative society postulates that the general body and no other organisation is the sole repository of the power in a cooperative society. It is also provided that any deviation therefrom can never have any life more than the life of a year and that too under the situations where there is a factual basis that the committee constituted by the general body has ceased to function or to continue in existence." 2. The present petition also presents the same situation, though in different context. Even here these basic aspects appeared to have been observed more in breach than by application and therefore with a view that such a situation cannot continue for an indefinite period, exercise of extraordinary powers has become inevitable on the factual matrix. 3. The concerned society is respondent No. 2 the Karamana Cooperative Urban Bank Ltd. The Bank got its bye laws for the management of its day-to-day business and affairs. The Bank is managed by elected Board of Directors. The first election was held on June 30,1991. As its members were found to be disqualified to continue, the Joint Registrar by the order dated August 17, 1992 disqualifying six members of the Board of Directors, appointed seven persons as Administrators, under S.33 (1) (b)(ii) of the Kerala Cooperative Societies-Act, 1969. This was initially for a period of six months. As the - Administrators did not take charge, the Joint Registrar passed another order dated February 16, 1993 reducing the number of Administrators to three, granting them a further extension of six months from February 18, 1993. It has to be stated that the Joint Registrar has specified the factual position in the said order (Ext. P-1) that the Bank had to complete the work of issuance of identity cards to the members of the Banks. It has to be stated that the Joint Registrar has specified the factual position in the said order (Ext. P-1) that the Bank had to complete the work of issuance of identity cards to the members of the Banks. It is stated that the work is known to be in progress and therefore in order to complete the work of issuance of identity cards, it is stated that further period of five months would be required. If is specified in the said order that to complete all preparations for the conduct of elections for the constitution of the new Board of Directors, a further period of one month would be necessary. It is in this background noted and realised in the order itself that a period of six months was granted by the Joint Registrar. It means that at that time itself the work of issuance of identity cards was in progress and was a ground for extension of the period. Additionally also it was thought that one month's period would be necessary to complete all preparations for the election process. 4. Thereafter, as stated above, three Administrators were appointed and were granted a period of six months on and from February 18, 1993. It is specifically stated that these Administrators shall be under the control of the Joint Registrar and were to obey instructions from time to time received from him. 5. In the light of this factual position prevailing at the time the petition was filed on July 7, 1993 praying for a writ of mandamus directing the respondents to take steps for conducting elections to the new committee in accordance with the provisions of S.28 (1B) of the Kerala Cooperative Societies Act, 1969 read with R.35 of the said Rules. 6. The petition has been met with by counters on behalf of respondent No. 1 in the main as well as respondent Nos. 6, 7 and 9. It would be necessary to consider the cases specified in these counters. 7. Respondent No. 1 in his counter, has referred to the orders of extension referred to in the factual matrix of the petition. In Para.4 of the counter it is averred as follows: "The term of Administrators were extended for a further period of six months as per Ext. P-1 order. 7. Respondent No. 1 in his counter, has referred to the orders of extension referred to in the factual matrix of the petition. In Para.4 of the counter it is averred as follows: "The term of Administrators were extended for a further period of six months as per Ext. P-1 order. Thereafter the term was extended for a further period upto 17th February 1995 as per order No. CRB. 7169/91, dated. 20th September 1993, 8th March 1994 and as per order No. CRB. 7169/91/K.Dis, dated 25th October 1994 of the Joint Registrar, Trivandrum. At present the Department Officer i.e., Assistant Registrar (Audit), Trivandrum is functioning as part-time Administrator of the Bank with effect from 27th October 1994. The above extensions were granted as permitted by the Government of Kerala in exercise of powers conferred under S.33 (1A) of K.C.S. Act, 1969." It would mean that the Administrators have continued and under the order the period upto, February 17, 1995 is also further extended for a period of six months further from February 18, 1995. These features will have to be examined and for that purpose the two documents [Exts. R-1(a) and R-1(b)] would require scrutiny. Reading these to exhibits we get the reasons and it is stated that it is necessary in public interest to extend the period to avoid administrative vacuum and to complete the election process. This extension, which is normally not available under any of the statutory provisions, is sought to be made available in exercise of powers under S.101 of the Kerala Cooperative Societies Act, 1969 directing that the provisions of S.33(1A) of the Act making them available for a period of one year and six months. This has an explanatory note referring to a report of the Registrar that the issue of identity cards to members has not been completed and new voters' list has not so far been prepared and finalised and hence the election process has not so far been initiated. It would always be clear that this reason was also ringing in the earlier order of extension, whereby the initial appointment of six Administrators which was subsequently reduced to three granting six months' extension was also based on this difficulty in issuance of identity cards. 8. Additionally the examination of Ext. R-1(b) provides the factual matrix further. It would always be clear that this reason was also ringing in the earlier order of extension, whereby the initial appointment of six Administrators which was subsequently reduced to three granting six months' extension was also based on this difficulty in issuance of identity cards. 8. Additionally the examination of Ext. R-1(b) provides the factual matrix further. It is also submitted that the Administrators took steps to issue identification cards to the members by making an advertisement in 'Mathrubhumi' dated August 19, 1994 by way of a reminder to the members to receive identification cards for which few months' time would be absolutely necessary. Additionally it is mentioned that the Secretary of the Bank and the other two employees namely Prabhakaran Nair and Jayachandran were under suspension in regard to which the enquiry officer also wants six months' time to complete the enquiry. 9. Thus the factual matrix presumes two reasons for forestalling the realisation of the democratic process. They are one that there is an enquiry pending against three employees of the Bank and further that the process of issuance of identification cards is not complete. 10. The consideration of the averments of the counters of respondent Nos. 6, 7 and 9 would also refer to the same reasons. But it is urged that steps to issue identity cards are in progress and when the estimated total membership is to the tune of 40000, reasonable time will have to be expected. In this aspect also it will have to be borne in mind that for some, reasonable time is necessary; whereas for others in regard to which some time is necessary, there is no uniformity. 11. Thus taking into consideration the rival contentions, it has to be ascertained as to whether the petitioner is entitled to the grant of relief in terms of prayers 1 and 2. 12. The above discussion shows that the process of issuance of identity cards was in progress as stated in the record right from February 1993 and it has been trotted as the reason for the continuance of the Administrators right from the beginning down to this date and it is sought to be perpetuated by resort to extraordinary powers under S.101 of the Cooperative Societies Act. What is impermissible or prohibited by the direct statutory provision and in addition what is basic and germane to the existence of a particular cooperative institution cannot be denied by a process of perpetuation. 13. The entire record shows that the Administrators have continued in perpetuating for the same reasons which had really not germane to the initiation of the election process. The issuance of identity cards, a cause which is ringing from February 19, 1993, has now at least been considered to be not a must for the starting of an election process by the highest court of the land. This court has to draw the necessary lesson when with regard to the general elections identity card had not considered to be a condition precedent or a condition sufficient enough to thwart the election process indefinitely. I have observed already that the democratic life and its continuance is the life of the Kerala Cooperative Societies Act, 1969. Administrator is an exception and at least the statutory authorities that are duty bound in law to put into effect the purpose of the legislations should not place before the court a ground which has sufficiently became stale by reason of passage of time as a difficulty in the process of elections. A trial has to be given and on the material on record at least I am not satisfied with the reasons that are trotted out are reasons sufficient to postpone the election process. 14. There is no doubt that the Bank has been forced to function by respondent No. 1 and the Administrators appointed by him and contrary to the provisions of law. The Administrators or their committees have functioned far beyond the statutory period, they have acted beyond the limits of their administrative authority under the statute and on record are sought to be perpetuated for no satisfactory reasons. 15. The result would be an inevitable conclusion that respondent Nos. 1 and 2 would have to be directed by a writ of mandamus to proceed with the process of election forthwith, as expeditiously as possible and at any rate the management should be made available to the elected body on or before April 30, 1995. 15. The result would be an inevitable conclusion that respondent Nos. 1 and 2 would have to be directed by a writ of mandamus to proceed with the process of election forthwith, as expeditiously as possible and at any rate the management should be made available to the elected body on or before April 30, 1995. In this process the respondents and the concerned statutory authorities are directed to take necessary steps in the process of election to respondent No. 2 by way of a time bound programme in the light of the last date as stated above. Thus the Original Petition gets decided as above. There shall be no order as to costs.