D. P. S. CHAUHAN, J. ( 1 ) DISTRICT Co-operative Central Bank Limited, Ujjain (hereinafter referred to as the Bank) is a registered Central Co-operative Society, registered under the Madhya Pradesh Co-operative Societies Act, 1960 (for brevity here-in-after referred to as the Act ). The Bank was having its registered bye-laws. ( 2 ) IN exercise of the powers under Section 12 (1) of the Act, the Registrar, co-operative Societies, directed the Chairman of the Bank that in place of the existing bye-laws of the Society of the Bank, the bye-laws as proposed by his be accepted and in case, the Bank finds and difficulty in accepting the bye-laws, then he may file objection by 24th September, 1979 before him in person. It was also mentioned in the said order that if no objection is filed within the time specified, it would be treated that the Bank has nothing to say and the proposed bye-laws will be treated to have been accepted by the Bank and such proposed bye-laws will be registered. On 24. 9. 1979, no body appeared from the side of the Bank but the Bank vide its letter no. 2278 dated 14. 9. 1979 sent by registered post, made a proposal for amendment in the proposed bye-laws and this letter was received by the Registrar, Co-operative societies on 15. 9. 1979 and whereafter the Registrar on 25. 1. 1989, passed an order registering such bye-laws without any amendment. This order was given challenge by way of an appeal before the Board of Revenue and the Board of Revenue registered it as Appeal No. 40-Do/80 which filed by one Laxman Prasad Bhargava, Advocate, who was a member of the general body of the Bank. The appeal was allowed saying that the order of the Registrar, Co-operative Societies dated 25. 1. 1980 did not comply the requirement of sub-section (2) of Section 12 of the Act whereunder he was supposed to give an opportunity to the bank to state its objections, if any, i. e. , he was supposed to give an opportunity of being heard the Bank and not obtaining opinion of such societies as may be notified by the State Government, and on the basis that no opportunity of being heard was given to the society, the order of the Registrar dated 25. 1.
1. 1980 registering the bye-laws, without the amendment proposed by the society, was set aside. This order is the subject-matter of the present writ petition. ( 3 ) THE present writ petition is filed by the state of Madhya Pradesh and by the registrar, Co-operative Societies, Madhya Pradesh, Bhopal. The Board of Revenue exercised the power of the State Government conferred on it by virtue of the provisions of Section 80 of the Act. ( 4 ) IN the present writ petition, the State of Madhya Pradesh itself has come as a petitioner. Here, the State of Madhya Pradesh under Section 80 of the Act, acted as an appellate Authority which power was exercised by the Board of Revenue. It was not proper for the State of Madhya Pradesh to have filed the writ petition against its own order. Such an attitude deserves to be condemned and the State is supposed to be careful, atleast while approaching the High Court and accordingly it is held that the state of Madhya Pradesh had no right under the law to maintain the petition and the petition on behalf of the state of Madhya Pradesh as such is incompetent. However, in the petition, the Registrar, Co-operative Societies, Madhya Pradesh, bbopal is the petitioner No. 2 and so far as the Registrar, Co- operative Societies, madhya Pradesh, Bhopal is concerned, the petition on his behalf is maintainable. ( 5 ) CAUSE list is revised. Counsel for the petitioner No. 2, Shri Vivekanand Awasthy is present and none is present from the side of the respondents. ( 6 ) IN this petition, only two questions are involved for consideration and determination: (1) Whether the appeal before the Board of Revenue against the order of the Registrar registering the bye-laws, dated 25. 1. 1980, was maintainable at the behest of Laxman Prasad Bhargava, Advocate; and (2) If it was maintainable, then, whether the amendment made in the bye-laws of the Bank by the Registrar, Co-operative Societies by making complete replacement thereof is valid and in accordance with Section 12 of the Act?
1. 1980, was maintainable at the behest of Laxman Prasad Bhargava, Advocate; and (2) If it was maintainable, then, whether the amendment made in the bye-laws of the Bank by the Registrar, Co-operative Societies by making complete replacement thereof is valid and in accordance with Section 12 of the Act? ( 7 ) IT may be noticed that in the writ petition, the person who is filed the appeal and against whom the allegation is made that the appeal on his behalf (i. e. , Laxman prasad Bhargava) was not maintainable had been impleaded as one of the respondent and simultaneously the Bank has also been impleaded as respondent. ( 8 ) SO far as the first question is concerned, whether the person who is a share holder in the society has got a right to challenge the order of the Registrar, registering the bye-laws of the society, dated 25. 3. 1980 in this connection Section 12 of the Act which provides for amendment in the bye-laws, is as extracted below:"32. Power to direct amendment of bye-laws, - (1) Notwithstanding anything contained in this Act or the rules or bye-laws if the Registrar considers that an amendment of the bye-laws of a society is necessary or desirable in the interests of such society, he may, by an order in writing to be served on the society in the prescribed manner, require the society to make the amendment within t me as may be specified in such order. (2) If the society fails to take any such amendment within the time specified by the Registrar in his order under sub-section (1) the Registrar may, after giving the society an opportunity to state its objections, if any, register such amendment and issues a certified copy thereof to such society and thereupon such amendment shall be binding on the society and its members.
" ( 9 ) SECTION 12 speaks for society and in sub-section (1) it has been stated that on the request of more than 50 per a nt of the members of the society amendment in the bye-laws may be proposed or if the Registrar considers that the amendment of the bye-laws of the society is necessary or desirable in the interests of such society, he may, by an order in writing to be served on the society in the prescribed manner, require the society to make the amendment within time as may be specified in such order. Sub- section (2) of Section 12 of the Act is a consequent provision on failure to take action under sub-section (1) and this sub-section provides for giving an opportunity to the society of being heard. ( 10 ) THE "society" is defined in clause (a) of Section 2 of the Act according to which Society means a Co-operative Society registered or deemed to be registered under this Act. ( 11 ) THE question for consideration is in whom the authority of the society vests? whether it vests in the members of the society or it vests in the society as a body corporate i. e. , by a resolution of the majority of the members of the general body. ( 12 ) SECTION 48 of the Act states that the final authority in a society shall vest in the general body of members: i. e. , i be decision would be taken by the majority of the members in the general body of the society and such a decision would be the decision of the society. ( 13 ) SO far as the question of society is concerned, it is the decision of the general body of the members of the Bank. The question is regarding share-holders. ( 14 ) MERE, it may be noticed that the co-operative movement does not recognise the membership on the basis of the share holding, whatsoever may be the share of a person but the Act recognises rights of the members one member one vote and as such, the participation through share capital has no basis so far as the co-operative movement is concerned. Participation on the basis of share capital is the concept of the Company and not the concept of the co-operative movement.
Participation on the basis of share capital is the concept of the Company and not the concept of the co-operative movement. ( 15 ) IN the case of Raman Singh v. State of Punjab, AIR 1985 SC 973 , which was a case where the validity of certain provisions providing for compulsory amalgamation of the Co-operative Societies, was given challenge, the Supreme Court had the occasion to consider the question as mentioned therein. In this case of amalgamation, the arguments was that in the absence of any provision, the rules of natural justice may be road into the provisions and notice to ail the members of the affect societies was imperative, otherwise, the members of one society would be forced against their will and without being heard to associate themselves with members of another society. The Court observed as :"we have no hesitation in rejecting this submission also. Once a person becomes a member of a Co-operative Society, he loses his individuality qua the society and he has no independent rights except those given to him by the statute and the by-laws. He must act and speak through the society or rather, the society alone can act and speak for bur qua rights or duties of the society as a body. ( 16 ) IN the present case, it has not been disclosed as to how Laxman Prasad bhargava was a member of the Bank which is a central society. If he was a member, then, he must have been the delegate to the general body of an individual primary society which may be the member of the Bank. However, this question is not relevant and is not necessary in view of the answer to the controversy which finds place in the decision of the Supreme Court (supra ). ( 17 ) IT is not the case that under the Act or the rules and the bye-law an individual member or even a delegate has been given right under Section 12 of the act. In view of this the first point deserves to succeed and the impugned order deserves to be set aside on this ground. ( 18 ) THE second question is regarding whether the amendment made in the bye-laws of the Bank by the Registrar, Co-operative Societies making complete replacement thereof is valid and in accordance with Section 32 of the Act?
In view of this the first point deserves to succeed and the impugned order deserves to be set aside on this ground. ( 18 ) THE second question is regarding whether the amendment made in the bye-laws of the Bank by the Registrar, Co-operative Societies making complete replacement thereof is valid and in accordance with Section 32 of the Act? sub-section (2) of Section 12 itself speaks for giving the society an opportunity of being heard. The society as dealt with here is the general body of its members. Section 12 of the act has conferred extraordinary power on the Registrar. Co-operative Societies to direct any amendment in the bye-laws of the Co-operative Society under sub-clause (2) and on the failure of the society to make amendment in its bye- laws within such time as prescribed by the registrar, the Registrar may register the amendment himself and in the latter case the Registrar is bound to give an opportunity of being heard to the society and this provision of sub-section (2) of Section 12 doubly assures that the amendment has not been unnecessarily imposed on the society, for, after all, it is an internal matter of the society as to what amendment it likes. The only rider is that the bye-laws should not be contrary to the Act or the rules. ( 19 ) IN the present case, the society was not aggrieved with the bye-laws as amended by the Registrar, Co-operative Societies under its order dated 25. 1. 1980 as the Society had not gone in the appeal against the said order of the Registrar. ( 20 ) IN view of the above, the impugned order passed by the Board of Revenue is not sustainable and deserves be set aside. ( 21 ) THE writ petition is accordingly allowed. The impugned order of the Board of Revenue dated 25. 4. 1985 is quashed. In the circumstances of the case, no order as to costs. Petition allowed. .