RAM SWAROOP PATHAK v. STATE OF MADHYA PRADESH — 1995 DIGILAW 512 (MP)

S. K. DUBEY, J. ( 1 ) BY this petition under Articles 226 and 227 of the Constitution of India the petitioner, who is the President of Gramin Vidyut Sahakari Samiti Maryadit, Laundi, District Chhatarpur (hereinafter called (he. 'society'), has challenged the order dated 1-6-1995 (Annexure-P/10) of Assistant Registrar of Co-operative Societies, Chhatarpur, passed under S. 49 (8) (ii) of the M. P. Cooperative Societies Act, 1960 (for short the 'act'), removing the Managing Committee of Society and authorising the respondent to assume office and manage the affairs of the society till fresh elections are held in accordance with law. ( 2 ) FACTS giving rise to this petition are these :the society is a registered co-operative society under the Act having its object to supply electrical energy which it gets from the M. P. Electricity Board at the rate of 10 Naya Paise per unit, which in turn society supplies to nearly about 15000 consumers at the rate of 65 Naya Paise per unit, the area of supply of electricity by the society extends to about 312 villages of the District Chhatarpur. The last election of the members of the Managing Committee was held on 25-4-1987 for a term of 5 years, but, by Amendment Act No. 14 of 1990 in the Act the period was curtailed to 3 years, as a result of which the Managing Committee was superseded. The petitioner and other various societies in the State of M. P. challenged the said provisions as being ultra vires by writpetitions, the petitioner's writ petition was M. P. No. 376 of 1991 (Ram Swaroop Pathak v. State of M. P. ). The petitioner and other various societies in the State of M. P. challenged the said provisions as being ultra vires by writpetitions, the petitioner's writ petition was M. P. No. 376 of 1991 (Ram Swaroop Pathak v. State of M. P. ). A Division Bench of this Court by a common judgment passed in M. P. No. 1111/90 (Anrudh Prasad Shastri v. The State of M. P.) decided on 21-6-1993 (reported in 1993 (2) MPJR 33 ), disposed of all the writ petitions, wherein this Court held that the provision of S. 49 (8) as amended curtailing the period of term of office from 5 years to three years is arbitrary and violative of Art. 14 of the Constitution of India as there is no nexus between the provision and the object sought to be achieved by it, which is clear from the statement of objects and reasons, is to promote democratic functioning of the society, which can only be done by holding fresh elections, but, the amendment gives a premium on the defaults of the Registrar in holding the fresh elections within the time frame. As a result of this decision, the Court observed that the members of the earlier Managing Committee of the petitioner's society will be deemed to continue legally and validly in the office till the elections are held in accordance with law. As the petitioners were removed from the office because of the amendment in S. 49 (8) the members of the committee vide memo dated 23-6-1993 (Annexure-P/3) of the Registrar of Co-operative Societies were placed in the office till the expiry of the term of their office, that is up to 21-3-1995. After the judgment in Anurudh Prasad Shastri, 1993 (2) MPJR 33 (supra) sub-sec. (8) of S. 49 was amended by the Amending Act No. 12/94. According to amended provisions of sub-sec. (8) of S. 49 the Managing Committee in terms of cl. (i) of sub-sec. (8) of S. 49 was to apply to the Registrar for holding elections within reasonable time in no case less than 90 days before expiration of the term of the committee. Admittedly neither committee passed a resolution to hold elections nor applied to Registrar in accordance with clause (i) of sub-sec. (8) of S. 49. (i) of sub-sec. (8) of S. 49 was to apply to the Registrar for holding elections within reasonable time in no case less than 90 days before expiration of the term of the committee. Admittedly neither committee passed a resolution to hold elections nor applied to Registrar in accordance with clause (i) of sub-sec. (8) of S. 49. ( 3 ) THE case of the petitioner is that the Assistant Registrar vide Annexure-P/5 dated 20-12-1994 received on 23-12-1994 communicated the petitioner the decision of starting the election process to hold election of the committee in the first week of January, 1995 and, for that the petitioner was asked to submit, by 30th December 1994, the list of members of the society in 6 copies, in the pro forma given in the letter. The petitioner vide letter dated 30-12-1994 (Annexure-P/6) requested the Registrar to appoint a Returning Officer for holding the elections of the members of the committee in accordance with bye-law No. 24 (b) of the Society and for that the petitioner vide letter dated 6-1-1995 (Annexure-P/7) sent the list of membership in 6 copies in response to the letter (An-nexure-P/4), but, instead of appointing Returning Officer for holding elections the Assistant Registrar served a show cause notice dated 3-2-1995 (Annexure-P/8) under S. 69 (3) of the Act for liquidation of the society for the lapses committed by it in particular consistent losses incurred till 1992-93 to the extent of Rs. 95-96 lacs. The petitioner for showing cause against the notice vide Annexure-P/9 demanded the copies of documents on which the charges were based, but, the copies of the documents were not supplied, hence the petitioner filed an appeal under S. 77 of the Act against the said show cause notice before the Joint Registrar, which is pending for its final decision. ( 4 ) AS the Managing Committee of the Society failed to hold election before the expiry of the term of its office as specified in sub-sec. (7-A) of the Act by applying to the Registrar for holding the election before the expiry of the term all the members of the committee deemed to have vacated their seats, hence, in terms of clause (ii) of S. 49 (8) of the Act, the Assistant Registrar of the Co-operative Societies. (7-A) of the Act by applying to the Registrar for holding the election before the expiry of the term all the members of the committee deemed to have vacated their seats, hence, in terms of clause (ii) of S. 49 (8) of the Act, the Assistant Registrar of the Co-operative Societies. passed an order Annexure-P/10 authorising the respondent No. 5 to take the charge and manage the affairs of the society till fresh elections are held. On receipt of the order Annexure-P/10 the respondent No. 5 states that the taken over charge of the society on 2-6-1995 by Annexure-P/12, which is disputed by the society, and the petitioner asserts that Managing Committee is still holding the charge and managing the affairs of the society. ( 5 ) SHRI V. K. Tankha, learned counsel for the petitioner contended that though the committee did not apply in terms of clause (i) of sub-section (8) of Section 49 to the Registrar before the expiry of 90 days of the term of the Committee for appointing a Returning Officer to hold elections of the members of the Committee in accordance with law, but, in the circumstances of the case, it was not necessary as the Assistant Registrar vide Annexure-P/15 already took a decision to commence election process in the first week of January 1995 for holding elections, therefore, he demanded 6 copies of the membership list in the pro forma. In continuation of that the petitioner vide Annexure-P/16 dated 30-12- 1994 requested the Assistant Registrar to appoint a Returning Officer to hold elections in accordance with bye-law No. 24 (b) and then vide letter Annexure-P/17 sent the list of membership in 6 sets and then also passed a resolution on 8-2-1995 for holding elections, copy of which was placed before this Court during the course of hearing. Therefore, in these circumstances as the elections were to be held before the expiry of the term of the office, i. e. , 21-3-1995, hence, it was not necessary to pass a resolution and to apply for holding elections prior to the expiry of 90 days of the term of the office of the members of the Committee and to apply to the Registrar for holding election. The intention and the purpose of the provision under S. 49 (8) of the Act is that the election must be held before the expiry of the term of the office of the outgoing Committee and if the Registrar on application of the Committee fails to conduct the election before the expiry of the term of the office and if a resolution passed by the outgoing committee to hold election at least 90 days in advance, the first proviso provides that the Registrar shall not assume charge of Committee and the members of the committee shall continue to hold the office. The second proviso to clause (i) of sub-sec. (8) of S. 49 further provides that if the Registrar fails to conduct the elections of the committee within 90 days of the expiry of the term of the committee, the committee of the Society shall appoint Returning Officer who shall conduct the election of the committee within 180 days from the date of the expiry of the term, therefore, the Assistant Registrar cannot take any advantage of their inaction in not appointing the Returning Officer for holding election. It was also submitted that the removal of the members of the committee and authorising an officer to take over the charge to manage theaffairs of the Society is contrary to spirit and scheme of the Act, as co-operative movement is necessary for giving shape to a secular sovereign democratic republic that India is destined to be as a republic is made of 'men and institutions', and co-operative societies are such institutions. "co-operative" has been understood as a form of organisation, where persons voluntarily associate together on the basis of "equality for the promotion of their economic interests by democratic means and methodology, therefore, the provision must receive such construction as would advance the purpose and intendment underlying the provision of holding election which is a democratic process. The decisions reported in B. K. Garad v. Nasik Merchants Co-op. Banklimited, AIR 1984 SC 192 , Bhandara District Central Co-op. Banklimited v. State of Maharashtra, AIR 1995 SC 59 and M. Ranga Reddy v. State of Andhra Pradesh, AIR 1989 AP 81 were pressed into service. The decisions reported in B. K. Garad v. Nasik Merchants Co-op. Banklimited, AIR 1984 SC 192 , Bhandara District Central Co-op. Banklimited v. State of Maharashtra, AIR 1995 SC 59 and M. Ranga Reddy v. State of Andhra Pradesh, AIR 1989 AP 81 were pressed into service. The intendment of the provision to hold election before the expiry of the term, where a situation like this is not covered by the provision, the Court should interpret the provisions in its spirit to avoid the mischief, a passage of Lord Denning quoted to para 42-A by the Supreme Court in case of Bangalore Water Supply and Sewerage Board v. A. Rajappa, AIR 1978 SC 548 : 1978 Lab IC 467 was referred and it was submitted that in such a situation a Judge should ask himself the question, how, if the makers of the Act had themselves come across this risk in the texture of it, they would have straightened it out? He must then do so as they would have done. A Judge must not alter the material of which the Act is woven, but he can and should iron out the creases. Counsel also referred to the passage quoted at pages 11 and 12 from the celebrated book on Principles of Statutory Interpretation, 5th Edition, by Justice G. P. Singh and submitted that it cannot be said that once the term is over, the elected committee even if it is not guilty of any irregularities and/ or malpractices has no right to continue in office and that Registrar can appoint anyone it likes to take the charge. ( 6 ) ON the other hand Shri S. K. Seth and Shri V. K. Shukla, Govt. Advocates on behalf of respondents 1 to 4 and Shri P. K. Jaiswal, learned counsel for respondent No. 5 contended that Section (7-A) declares the term of the office of the committee as 5 years from the date of their first election, sub-section (7-AA) empowers the State Government to extend the term of the committee of a society or a case of societies by notification, for reasons given therein, from time to time, but; for a total period not exceeding 12 months. Thereafter the elected body has no right to continue in the office; as sub-section (8) (i) casts an obligation on the out going committee of the society to hold elections prior to expiration of its term and for that it has to apply to the Registrar for holding elections within a reasonable time in any case not less than 3 months before expiration of the term of the committee and if the society fails to apply, the necessary consequence follows. It is well settled that when a statute requires a certain thing to be done in a certain manner it has to be done in that manner alone. As the society did not proceed according to the law, the order Annexure P-10 passed by the Assistant Registrar, because of the vacation of the seats of the members of the out going committee by deeming provided is neither illegal nor is without jurisdiction. The petitioner cannot take advantage of the letter dated 20-12-1994 received by the society on 23-12-1994 issued by the Assistant Registrar as the society neither passed a resolution for holding elections nor applied for appointment of a Returning Officer prior to the expiry of 90 days of the term of the Officer. As there is no estoppel against statute, the order of Assistant Registrar informing the society to commence the election process from the first week of January, 1995 will not wipe out the lapse on the part of the society and, the consequence of vacation of seats. Learned Counsel cited Morgan Stanley Mutual Fund v. Kartik Das, (1994) 4 SCC 225 and M/s. Jit Ram Shiv Kumar v. State of Haryana, AIR 1980 SC 1285 . ( 7 ) TO appreciate the contentions, it would be appropriate to refer the amended provisions of sub-sections (7-A), (7-AA) and (8) of Section 49 of the Act which read thus:-"49. Annual General Meeting - (1) to (7 ). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Annual General Meeting - (1) to (7 ). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7-A) (i):-The term of the committee shall be five year from the date on which first meeting of the committee is held : Provided that where a committee superseded, suspended or removed under the Act is reinstated as a result of any order of any Court or authority, the period during which the committee remained under supersession suspension out of office as the case may be, shall be excluded in computing the period of the term aforesaid. (ii) The term of the representative elected by the committee of the society shall be co- terminus with the term of the committee of the society for which representative is elected : Provided that the representative of a committee shall continue to hold his office till the expiry of the term of the committee of which he is member. (7-AA): The State Government may, by notification for reasons to be stated therein, extend the term of the committee of a society or a class of societies from time to time, for a total period not exceeding twelve months. (7-AAA): -----------------------------" (8) (i) : It shall be obligatory on the out going committee of the society to hold elections prior to the expiration of the term under sub-section (7-A) or extended term under subsection (7-AA ). (7-AAA): -----------------------------" (8) (i) : It shall be obligatory on the out going committee of the society to hold elections prior to the expiration of the term under sub-section (7-A) or extended term under subsection (7-AA ). The outgoing committee shall apply to the Registrar for holding election within a reasonable time which shall not be in any case less than 90 days before expiration of the term of the committee : Provided that if the outgoing committee has resolved and requested the Registrar to hold election atleast 90 days in advance and the Registrar has failed to conduct elections on its request, the Registrar shall not assume charge of the committee and the members of the committee shall continue to hold the office : Provided further, that if the Registrar fails to conduct elections of the committee within 90 days from the date of expiry of the term of the committee, the committee of the society shall appoint returning officer who shall conduct the election of the committee within 180 days from the date of the expiry of the term. (ii) If the committee fails to hold election and has not handed over the charge on expiration of the term, under sub-section (7-A) or extended term under sub-section (7-AA) to the Registrar or any officer authorised by him on his behalf, all the members of the committee shall be deemed to have vacated their seats and the Registrar shall assume charge and hold election as early as possible. (9) to (10 ). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ( 8 ) A reading of sub-section (7-A) shows that it declares the term of the committee shall be 5 years from the date of which the first meeting of the committee is held. Proviso of this section speaks that in a case where the committee is superseded or removed under the Act, is reinstated as a result of any order of the Court or Appellate Authority, the period during which the society remained under suspension or supersession, as the case may be, shall be excluded in computing the period of one full term of 5 years. . . ( 9 ) SUB-SECTION (8) of Section 49 makes the provision for holding of elections of society before the expiry of term of office as provided by sub-section (7-A) or the extended term under sub-section (7-AA) and if the elections are not held the consequence follows as envisaged in clause (ii) of sub-section (8) of Section 49 which lays down that if the committee fails to hold election and has not handedover the charge on expiration of the term specified in sub-sec. (7-A) or extended term under sub-sec. (7-AA) to the Registrar or any officer authorised by him in his behalf, all the members of the committee shall be deemed to have vacated their seats and the Registrar shall assume charge and hold election as early as possible. For holding the election prior to the expiry of the term of the office of the outgoing committee, clause (i) of sub-section (8) of Section 49 casts a duty on the outgoing committee of the society to apply to the Registrar for holding election within a reasonable time which should not be in any case less than 90 days before expiration of the term of the committee so that newly elected body may take the charge on the expiry of the term. First proviso to this clause is in nature of exception and speaks that if outgoing committee has resolved and requested the Registrar to held election at least 90 days in advance and the Registrar has failed to conduct the election on its request, the Registrar shall not assume charge of the committee and the members of the committee shall continue to hold the offices. Second proviso to clause (i) is another exception that if the Registrar fails to conduct the elections of the committee within 90 days of the expiration of the term of the committee, the committee of the society shall appoint returning officer who shall conduct the elections of the committee within 180 days from the date of the expiry of the term. If the election of the committee is not held in the manner provided, clause (ii) of sub-section (8) speaks of consequence which lays down that if the committee fails to hold election and has not handed over the charge on expiration of the term specified in sub-section (7-A) or extended term under sub-section (7-AA) to the Registrar or any officer authorised by him on his behalf, all the members of the committee shall be deemed to have vacated their seats and the Registrar shall assume charge and hold election as early as possible. ( 10 ) IT is well settled principle of law that if a statute requires certain thing to be done in a certain manner, it can be done in that manner alone unless contrary indication is found in the statute, which is not here. Reading of sub-section (8) makes clear that it is the outgoing committee of the society which has to take steps for holding elections. If it fails to take steps in the manner provided, consequence follows by operation of law. The language used in sub-section (8) (i) and (ii) is not ambiguous and in clear in terms and is manifest about its intention. ( 11 ) TRUE, while interpreting a provision, a Court of Justice takes into consideration the spirit and meaning of the provisions of Act apart from the words, the Act should be construed according to its intent, though not according to its words, while interpreting the statutory provisions containing legislative measures, it is the function of the Court to construe legislative measures in reaching the correct meaning and to give effect to legislative measures. The intention of the provisions contained in sub-section (8) is that a committee whose term is going to expire has to see that elections are held prior to the expiry of its term, so that newly elected body on expiry of the term may take over to manage the affairs of the society. The intention of the provisions contained in sub-section (8) is that a committee whose term is going to expire has to see that elections are held prior to the expiry of its term, so that newly elected body on expiry of the term may take over to manage the affairs of the society. If out going committee fails to hold elections prior to expiry of its term it cannot continue in its office on one pretext or the other except for the reasons as provided by the two provisions and for that legislation has made a provision in clause (ii) of subsection (8) of Section 49, because, the cooperative movement should be managed by the validly elected body successfully as cooperative movement is both a theory of life and a system of business. It is a form of voluntary association where individuals unite for mutual aid in the production and distribution of wealth upon principles of equity reasons and common good. It stands for distributive justice and asserts the principles of equality and equity to all those engaged in production of wealth a share proportionately commensurate with the degree of their contribution. It provides as a substitute for material assets, honesty and a sense of moral obligation and keeps in view the moral rather than material sanction. The movement is thus a great moral movement. Such being the nature of the co-operative movement there is no place in any co-operative society for any member or the members of the committee who want to continue in the office in spite of the expiry of the term of their office. The movement is thus a great moral movement. Such being the nature of the co-operative movement there is no place in any co-operative society for any member or the members of the committee who want to continue in the office in spite of the expiry of the term of their office. ( 12 ) UNDISPUTABLY, the elections were to be held before 21-3-1995, i. e. before expiry of the term of the outgoing committee, hence, the outgoing committee has no right to continue in the office, whether it has taken steps or not for holding elections, if the elections are not held before the expiry of the term of the outgoing committee, the members of the outgoing committee would be deemed to have vacated their seats and assuming of charge by the Registrar would be automatic unless the new elected body actually comes into being, that is the view taken by a Division Bench of this Court in case of Board of Directors of U. S. S. v. Assistant Registrar, Co-operative Societies, Jhabua in M. P. No. 522 of 1982 decided on 19-4-1983 reported as a short noted decision in 1983 MPWN 467, following the earlier Division Bench decision in case of Kamlakar Chaturvedi v. State of M. P. W. P. No. 1129 of 1982 decided on 4-9-1992. ( 13 ) THEREFORE, contention that there was nothing to be done on the part of the outgoing committee of the society as the Assistant Registrar had already decided to start the election process for holding the elections in the first week of January, 1995, has no merits, as the out going committee did not discharge its obligation and has not acted in the manner as provided by the statute for holding the elections. ( 14 ) AS an upshot of the above. I find no infirmity in the order Annexure P-10, the petition has no merit and is dismissed with the direction to the respondents to hold election of the committee of the society within a period of, three months and to hand over the charge to the newly elected committee. ( 15 ) IN the circumstances of the case the parties to bear their own costs. Petition dismissed. .