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2001 DIGILAW 23 (KAR)

BANGALORE GRAIN MERCHANTS ASSOCIATION v. DISTRICT REGISTRAR FOR SOCIETIES

2001-01-05

A.M.FAROOQ, H.L.DATTU, P.VENKATARAMA REDDI

body2001
REDDI P. V, J. ( 1 ) APPARENTLY conflicting decisions of the division benches of this court on the scope and interpretation of Section 25 (1) of the Karnataka societies Registration Act (hereinafter referred to as 'the act') has given rise to this reference to the full bench. What are the preconditions for the exercise of power of holding or directing an enquiry by the registrar into the constitution, working and financial condition of a registered society? Whether the registrar could be said to have exercised power on his now motion, when such power is exercised on the basis of the complaint made by less than 1/3rd of the members of the society, and if so, under what circumstances? These, in brief, are the questions which fall for the consideration of the full bench. ( 2 ) TURNING to the facts first, we notice that the memorandum signed one by Sri ramaiah shetty (the impleaded respondent herein) a member of the Bangalore grain merchants association which is a registered society together with the purported signatures of 157 other members was presented to the chief minister of Karnataka on 11. 7. 1995 complaining against the manner of functioning of the governing body/managing committee of the society. Various irregularities and acts of dishonesty in the management of the society were alleged therein. Collection of unauthorised amounts, non-accountal of the monies collected from the members of the association towards cyclone relief fund, unauthorised allotment of sites to the members and non-members, non-submission of annual reports and statements to the registrar, default in conducting the elections are some of the allegations made against the society. A request was made on 22. 8. 1995 to direct the managing committee to produce the account books, annual reports etc. , before the government for inspection and to supersede the present committee and to hold elections. It appears that a copy of the said application was forwarded to the registrar of firms. Bangalore urban district for appropriate action. The registrar in his turn called for the comments of the association to be submitted within 7 days. A reference was made by the registrar to the petitions submitted by the members of the society on 11. 7. 1995 and also an inspection report dated 5. 6. 1995. Bangalore urban district for appropriate action. The registrar in his turn called for the comments of the association to be submitted within 7 days. A reference was made by the registrar to the petitions submitted by the members of the society on 11. 7. 1995 and also an inspection report dated 5. 6. 1995. The secretary of the association made a bald denial of the allegations in general terms and promised to produce the audit report and the proceedings of the general body meeting soon after the meeting was held. However, the proposed date of general body meeting was not mentioned. It appears from the proceedings dated 4. 10. 1995 (Annexure-F) that the secretary of the association, by his subsequent letter dated 28. 9. 1995 sought further time of one month to submit the explanation. Thereupon, by an order dated 4. 10. 1995, the registrar decided to hold an enquiry in exercise of power under Section 25 (1) of the Act, having felt that there was apparent justification for holding the enquiry. Before that date, the member of the association. Sri ramaiah shetty, submitted a representation directly to the registrar of societies on 22. 9. 1995 reiterating the allegations made in the earlier joint representation. ( 3 ) PURSUANT to the decision taken by the registrar on 4. 10. 1995, the enquiry under Section 25 (1) of the act commenced on 16. 101995. Statement of objections was filed on 10. 11. 1995. It was contended therein that there was no prima facie material to hold an enquiry and that the enquiry had been initiated without giving reasonable time to submit further reply. It was stated that the account books were with the auditors and they will be produced soon after obtaining the same from the auditor. It was further submitted that the documents relating to site layout were not available as no such layout was undertaken by the association. In the course of enquiry, the counsel for the association made an application to examine the persons who made the complaint. As it was not possible to examine all the 158 persons, the counsel was permitted to cross-examine the main complainant- Sri ramaiah shetty. Evidence was recorded by the registrar and after hearing the arguments on 9. 10. 1996. Orders were passed on 3. 2. As it was not possible to examine all the 158 persons, the counsel was permitted to cross-examine the main complainant- Sri ramaiah shetty. Evidence was recorded by the registrar and after hearing the arguments on 9. 10. 1996. Orders were passed on 3. 2. 1996 by the 1st respondent-registrar, the registrar felt that the appointment of an administrator was necessary to set-right the affairs of the society and he accordingly requested the government to appoint an administrator immediately. In the order dated 3. 2. 1996, the registrar, expressed that there was clear evidence to establish the formation of a layout for house sites at yelhanka and the registration of sites in favour of some of the members and the denial by the secretary about the formation of the layout was false. It was also observed that the statements of account for the year 1993, 1994, and 1995 furnished in the course of enquiry did not tally with the accounts furnished to the members at the meetings. Certain receipts issued by the secretary/honorary treasurer were adversely commented upon. The registrar concluded that the accounts have not been properly maintained and audited, that there was misappropriation of funs, and the general body meetings have not been held as per the bye-laws. ( 4 ) THE writ petitioner has filed an application for amendment of the prayer in ia No. Iii seeking to assail the legality of the order dated 3. 2. 1996 (Annexure-H ). Interim stay of the operation of the order was granted on 4. 2. 1996. ( 5 ) THE main contention urged before this full bench is that the registrar of societies had no jurisdiction to initiate and hold enquiry under Section 25 (1) of the act as the preconditions for exercise of power under that provision are not satisfied. It is contended that the complaint-petition submitted by less than 1/3rd of the members of the society cannot be the basis for conducting an enquiry either under the first limb or any other limb of Section 25 (1 ). A corollary to this argument is that the registrar could not have exercised suo motu power vested in him under the opening clause of Section 25 (1) when the complaint was presented by the members of the society whose number fell short of 1/3rd. Reliance is placed on the division bench decision of this court in. A corollary to this argument is that the registrar could not have exercised suo motu power vested in him under the opening clause of Section 25 (1) when the complaint was presented by the members of the society whose number fell short of 1/3rd. Reliance is placed on the division bench decision of this court in. A. S. kupparaju V. General Secretary, Raju Kshatriya Welfare Association, ILR 1990 kar 3721; S. Sreenivasa Rao V. Sub-registrar (head quarters), ILR 1990 kar 3740. At this stage, we may observe that the second decision undoubtedly supports the contention of the petitioner thought not the first decision. A subsidiary contention turning on the validity of the order recommending for appointment of a administrator has also been raised. ( 6 ) THE learned counsel for the impleaded respondent and the learned government Advocate have endeavoured to justify the exercise of suo motu power of enquiry under Section 25 (1) from the standpoint of the legal position coupled with the fact situation. It is contended that the power has been exercised in the instant case in conformity with Section 25 (1) of the act and the exercise of such power is perfectly justified. Reliance is placed on the earliest division bench decision of this court in Muslim Co-Operative Bank: Ltd, V. Assistant Registrar of Co-Operative Societies, ILR 1990 kar 3705, which is directly in point and the decision by the single judge of this court in district Muslim Welfare and Education Society V. District registrar of societies, AIR 1997 kar 383 . As regards the scope and ambit of suo motu power, certain decisions have been pressed into service and they will be referred to at the appropriate stage. ( 7 ) WE shall now refer to the relevant Provisions of law. Section 25 (1) of the Karnataka societies Registration Act reads : the registrar may on his own motion and shall no the application of the majority of the members of the governing body or of not less than one third of the members of the society, hold an enquiry or direct some person authorised by him by order in writing in accordance with the rules made in this behalf to hold an enquiry into the constitution, working and financial condition of a registered society. " (2) the registrar or the person authorised by him under sub-section (1) shall have the following powers, namely : (a) he shall at all reasonable times, have free access to the books, accounts documents, securities, such and other properties belonging to or in the custody of the society and may summon any person in possession or responsible for the custody of any such books, accounts, documents, securities, cash or other properties to produce the same at any place at the headquarters of the society or any branch thereof; (b) he may summon any person who, he has reason to believe has knowledge of any of the affairs of the society to appear before him at any place at the head quarters of the society or any branch thereof and may examine such person on oath; (iii) when a enquiry is made under this Section, the registrar shall communicate the result of the enquiry to the society concerned. We may also notice Rule 8 framed under the act. The Rule governs the procedural modalities of conducting the enquiry. The rules contemplates issuance of notice to the society calling for explanation, fixing the date of enquiry, oral hearing reception of oral and documentary evidence and recording the findings. From the above Provisions, it is fairly clear that the enquiry, when once it is set in motion, partakes of the character of quasi-judicial enquiry. A fair procedure is prescribed for this purpose. (7-a) an analysis of Section 25 (1) also discloses that the are three situations in which the registrar can initiate and hold an enquiry. These are : (1)the registrar acting on his own motion, (2) the registrar acting at the instance of the majority of the members of the governing body and (3) the registrar acting on the request of 1/3rd of the members of the society. In the first contingency, the exercise of power is discretionary and enabling, as denoted by the word 'may' whereas in the latter two cases, it is obligatory to hold an enquiry as seen from the word 'shall'. If the second and third requisites are satisfied, the registrar has no option but to trigger off an enquiry in deference to the wishes of the requisite number of members unless, of course the allegations are alien to the working of the society. If the second and third requisites are satisfied, the registrar has no option but to trigger off an enquiry in deference to the wishes of the requisite number of members unless, of course the allegations are alien to the working of the society. In the first case, the registrar can act on his own motion irrespective of any application by the majority of the members of the governing body or 1/3rd of the members of the society. The registrar, however, is not compelled to act if the situations 2 and 3 are absent. He can exercise his discretion whether to act or not on the basis of the material or information in his possession. It is significant to the note that the expressions 'may' and 'shall' are used in the same sub-section in contradistinction to each other to emphasize the distinction, which we have earlier pointed out supra. In the context, may and 'shall' mean what they ordinarily mean, though it is not uncommon to read one for the other. Of course, the discretion vested in the registrar under the opening clause may not be absolute and unchannelised. The exercise of discretion is by implication conditioned and moulded by the statutory purpose underlying conferment of such power. Depending on the facts and circumstances of the case, the discretion may be coupled with a duty to Act, if such action is warranted. Even in the first situation, therefore, the registrar cannot exercise or refuse to exercise the power to hold the enquiry on his whim and fancy. ( 8 ) IN fact, what we have expressed above is in line with that has been said in almost all the cases starting from mahila seva samaj case. In as. Kupparaju's case, ILR 1990 kar 3721 supra, the legal position has been aptly stated in the following words : "whatever source or sources, he has the discretion to hold or not to hold an enquiry or direct the holding of it or not holding it by person authorised by him. On the other hand. If it is a case falling either under the second or the third occasion indicated by us, that discretion is taken away by the legislature and the registrar is mandated to hold the enquiry or direct the holding of it by person authorised by him. " in muslim co-operative bank ltd. On the other hand. If it is a case falling either under the second or the third occasion indicated by us, that discretion is taken away by the legislature and the registrar is mandated to hold the enquiry or direct the holding of it by person authorised by him. " in muslim co-operative bank ltd. V. Assistant registrar of co-operative societies, ILR 1990 kar 3705. Rama jois, j, speaking for the bench had analysed the scope of sub-section (1) of Section 25 of the act in similar terms. The learned judge observed as follows ;"therefore, on the plain language of both Section 25 of the societies act and Section 64 of the Act, it is clear the registrar of societies in the case of societies under the societies act and registrar of co-operative societies in the case of the act have got undoubted powers of initiate an enquiry into a society or co-operative society, as the case may be suo motu. This power is independent of not only the power but also the duty to hold an enquiry when it is demanded in writing by the requisite number of persons named in Section 25 (1) of the societies act in respect of a society and Section 64 (1) of the act in respect of a co-operative society. In other words, in respect of a society registered under the societies Act, if majority of the members of the governing body or 1 /3rd of the total number of members make a written request to the registrar to hold an enquiry, he is bound to do so. If he fails to do so, the requisitionists are entitled to seek a writ of mandamus directing the registrar to institute an enquiry. Similarly in the case of a co-operative society if a written request for holding an enquiry into the affairs of the society is made either by another co-operative society of which the society concerned is a member or by majority of the members of the managing committee of the society or by not less than 1/3rd of the total number of members of the co-operative society the registrar is bound to institute an enquiry. This power and duty is independent of thesuo motu power conferred on the registrar. "respectfully, we record out concurrence with the above analysis of Section 25 (1 ). This power and duty is independent of thesuo motu power conferred on the registrar. "respectfully, we record out concurrence with the above analysis of Section 25 (1 ). ( 9 ) NOW, we come to the more crucial and controversial question te. , what is the meaning and import of the expression 'on his own motion' and what is its interrelation to the immediately following clauses of the same sub-section. There could be no doubt, that the expression 'on his own motion' is synonymous to sup motu. Which according to the dictionary means, "on one's won initiative". Own motion' obviously implies application of mind and formation of one's own opinion. It does not matter how and from what source he gets information. But. It does not mean that the authority conferred with such power should eschew from consideration information or material furnished by external sources and should look to the information collected by his ownself-effort. The exercise of powers suo motu or one one's own motion, cannot and ought not to be construed in a narrow sense and in a sense which defeats the salutary purpose of the provision. No fetters can be placed on the specified authority from the stand point of source material on which it should exercise the power. An authority exercising the suo motu power is not debarred from obtaining informations and materials from various sources. The only requirement is that on the basis of such informations and materials gathered either on its now initiative or received from other sources, the concerned authority has to come to the conclusion, on an active application of mind whether to take up the enquiry or not. Undoubtedly, the decision must be his own. He cannot mechanically act at the behest of some other person or authority without independent application of mind to arrive at a conclusion on the need and expediency of holding an enquiry. It is not argued before us for can it be disputed that the suo motu exercise of power does not cease to be such merely because a member of the public or someone in the know of things brings relevant facts to the notice of the prescribed authority, in this case the registrar. The registrar, on a consideration of such facts has to decide whether it is a fit case warranting initiation of enquiry in the over-all interests of the society. The registrar, on a consideration of such facts has to decide whether it is a fit case warranting initiation of enquiry in the over-all interests of the society. The decision must be his and the decision must of course be based on relevant factors, but there is no limitation as to the sources by which he should be prompted to action. ( 10 ) A three judge bench of the Supreme Court held in the board of revenue, Madras V. Raj brothers agencies, AIR 1973 SC 2307 that a suo motu power conferred on the board of revenue to call for and examine an order passed and proceeding recorded by the subordinate authority under the Madras general Sales Tax Act does not preclude the board to exercise its power at the instance of an assessee. The Supreme Court observed that the power is conferred on the board to remedy any injustice. It is open to an assessee or the revenue to bring to the notice of the board any error made by the subordinate authority. It is upto the board to consider whether the case is a fit case for exercising its revisional jurisdiction. ( 11 ) A different note has been struck in state of Andhra Pradesh V. T. g. lakshmaiah setty and sons, 94 stc 190, rendered by two learned judges of the Supreme Court. Having regard to the scheme of the a. p. general Sales Tax Act similar to mgst Act, the learned judges held in that case the power of suo motu revision can only be exercised in the interests of revenue but not pursuant to an application filed by the assessee seeking relief. The decision in RAJ brothers agencies case was not referred to by their lordship. The ratio of RAJ brothers case rendered by three learned judges cannot be said to have been shaken by the bench consisting of two learned judges. It is worthy to note that even in t. g. lakshmaiah setty case (94 stc 194), the Supreme Court did not lay down a general proposition that the expression suo motu ruled out action on the basis of applications and representations. In gill and co. It is worthy to note that even in t. g. lakshmaiah setty case (94 stc 194), the Supreme Court did not lay down a general proposition that the expression suo motu ruled out action on the basis of applications and representations. In gill and co. V. Commissioner of commercial taxes, andhra pradesh, a division bench of a. p. high court while considering a provision in a. p. general Sales Tax Act conferring suo motu power of revision on the commissioner, observed thus :"evidently this power can be exercised by the officer on his receiving the relevant information which in his opinion calls for the exercise of power. The information may come from any source, departmental or any other including the assessee. If he thinks that such information or application calls for exercise of his power, he may exercise it; otherwise, not,"the judgment of the Supreme Court in RAJ brothers case ws relied upon. Though the ultimate conclusion reached by the a. p. high court is contrary to the legal position laid down by the two judge bench of the Supreme Court in t. g. lakshmaiah setty's case, the general observations made therein on the scope and ambit of suo motu powers are unexceptionable and can be aptly applied to the present case as well. ( 12 ) THE observations of rama jois. J, in muslim co- operative banks case are also apposite. Referring to the suo motu power in the same provision with which we are concerned, if was observed : "naturally for exercise of suo motu powers also, there must be some source of information for the registrar to do so. Such information may come to the registrar of the societies during his inspection of a society or by any other means including written complaint by a member". Having so understood the concept of suo motu power of enquiry, the division bench held in muslim co-operative bank's case that the registrar can very well act upon a complaint made by even a single member of the society. ( 13 ) WE have so far dilated on the general nature and normal connotation of the expression suo motu or on 'one's own motion'. The next question is whether in the context, the phrase 'on one's own motion' or suo motu should be given a restricted meaning under Section 25 (1) of the act. ( 13 ) WE have so far dilated on the general nature and normal connotation of the expression suo motu or on 'one's own motion'. The next question is whether in the context, the phrase 'on one's own motion' or suo motu should be given a restricted meaning under Section 25 (1) of the act. The learned counsel for the petitioners having realised the futility of the argument that the general concept of suo motu power excludes an action based on representation or complaint has endeavoured to concentrate on the above question. He wants to say that in so far as the members of the society or its governing body come forward with an application to hold the enquiry, the registrar cannot exercise his power under Section 25 (1) of the act unless the requisite number of them file such application. If less than 1/3rd of the members of the society make an application as in the present case, the registrar cannot arrogate to himself the power to order an enquiry under the first limb of the sub-section, according to the counsel. The implication of this argument is that whenever the members of the society make a complaint and request for an enquiry into the constitution, working and financial condition of the society, the registrar has to first satisfy himself that such members constitute 1/3rd of its total strength and then only proceed to make an enquiry. If the number of signatories to the complaint are less than 1/3rd, according to the learned counsel, the registrar cannot act on it and clutch at the jurisdiction to hold the enquiry in the guise of suo motu exercise of power. The learned counsel reinforces his argument by reference to the well-known principle of statutory construction which lays down; "where a power is given to do certain things in a certain way, the thing must be done in that way or not at all and other methods of performance are necessarily forbidden. " vide the dicta in ramachandra keshav adke V. Govind joti chavare, AIR 1975 SC 915 . ( 14 ) THERE is a fallacy underlying the argument advanced by the learned counsel for the petitioner. Neither the contextual interpretation nor any canon of construction would countenance the argument of the learned counsel. " vide the dicta in ramachandra keshav adke V. Govind joti chavare, AIR 1975 SC 915 . ( 14 ) THERE is a fallacy underlying the argument advanced by the learned counsel for the petitioner. Neither the contextual interpretation nor any canon of construction would countenance the argument of the learned counsel. The argument of the learned counsel ignores the crucial fact that suo motu power conferred by the first limb of sub-section can come into play independent of the power confided to the registrar in two specific situations. The three relevant clauses of Section 25 (1) have to be read harmoniously and to effectuate the objective of the provision. The ambit and plenitude of the power vested in the registrar to act on his own motion cannot be curtailed and crippled by any 'a apriori' notion that it stands excluded where the members less than the requisite percentage become complainants. There is no taboo against a member or members less than 1/3rd approaching the registrar with a petition and the registrar taking cognizance of the same and proceeding to make an enquiry on the basis of information laid before him. As already observed, the information forming the basis of exercise of suo motu, power may come from any source including a single member of the society. The exercise of such power by the registrar cannot be controlled by the fact that the complaint is made by less than 1/3rd of the members. If the number of members petitioning to the registrar is 1/3rd or more, as already discussed, the registrar is bound and obliged to initiate a on enquiry. He has no option but to act and direct the enquiry. But, if the number is less, the registrar can very well refrain from holding the enquiry, if he feels that the enquiry is not warranted. His refrain may be on account of may factors allegations being vague or ex-fade incredible or contrary to the informations on record or the allegations being unrelated to the constitution, working or financial condition of the society. If the registrar decides not to move in the matter of the basis of complaint lodged by lass than 1/3rd of the members, the court cannot compel him to institute an enquiry expect in some rare cases such as total non-application of mind to the tell-tale facts. If the registrar decides not to move in the matter of the basis of complaint lodged by lass than 1/3rd of the members, the court cannot compel him to institute an enquiry expect in some rare cases such as total non-application of mind to the tell-tale facts. It is only to emphasize the distinction between the discretionary and obligatory nature of duty of the registrar to hold an enquiry that the second and third modes are specifically enjoined by the statute. Otherwise, the opening clause itself empowering the registrar to hold enquiry on his won motion, would have been sufficient to take care of all other contingencies including the application by members. The suo motu exercise of power does not get excluded merely because less than 1/3rd of members of the society make a complaint and invite action of the registrar. That was what exactly held by the division bench, speaking through rama jois j. In muslim co-operative banks, case. We share the same view as was expressed in that case. ( 15 ) THERE is a recent judgment of this court wherein bharucha, j. Has taken the same view in district Muslim Welfare and Education Society V. District Registrar of societies, AIR 1997 kar 383 . It was observed at paragraph 5 of the judgment as follows : "a reading of the above provision makes it clear that an enquiry as contemplated in Section 25 is to be necessarily held, if an application to that effect is filed by the majority of the members of the governing body or of not less than 1/3rd of the members of the society. But the legislation at the same time has vested the discretion in the registrar to initiate such an enquiry on his own motion to enquiry into the constitution, working and financial condition of a registered society. Such an exercise can be undertaken by the registrar on his own motion only on the basis of some cogent materials for that purpose. Therefore, for holding an enquiry on his own some information must come to his possession either from the external or from the internal sources, which on an objective appraisal may necessitate an enquiry as statutorily prescribed. " (15-a) the interpretation that is sought to be placed by the petitioners' counsel, if is to be accepted, would lead to anomalous and unintended results. " (15-a) the interpretation that is sought to be placed by the petitioners' counsel, if is to be accepted, would lead to anomalous and unintended results. If a person unconnected with the society makes a complaint to the registrar as regards the working of the society, the registrar will be free to act it, whereas, if a member of the society supposed to have better knowledge of the affairs of the society, prefers a complaint, the registrar will be debarred from acting suo motu. However weighty and reliable the material disclosed in the representation of the member, the registrar will be helpless to act under any of the limbs of Section 25 (1) of the Act, if the contention of the petitioners counsel has to be accepted. Moreover, the purpose of conferring the suo motu power to holding or ordering an enquiry will be defeated. If the registrar is disabled from doing so merely for the reason that the information is laid before him by a member or members of the society less than 173rd. However reliable such information may be. There is no good reason why such fetter should be placed on the power of the registrar to act suo motu. The moment the registrar takes into consideration the points highlighted by some members of the society/ (less than 1/3rd), he will be handicapped from launching an enquiry though he may be fully satisfied that an enquiry should be held in public interest. The interpretation placed by the learned counsel for the petitioners would, therefore, be opposed to the cardinal Rule of purposive construction and would render the power conferred on the registrar may a time unworkable. We see no compelling reasons to read down the power conferred by the first limb of Section 25 (1) of the act so as to exclude therefrom the complaints made by less than 1/3rd of the members. ( 16 ) WE are, therefore, of the view that mahtia seva somaj case and srintuasa rao's case insofar as they lay down the law that the registrar cannot exercise suo motu power under the first limb of the sub-section, if the complaint is made by a single member or by members falling short of 1/3rd are hereby overruled. ( 16 ) WE are, therefore, of the view that mahtia seva somaj case and srintuasa rao's case insofar as they lay down the law that the registrar cannot exercise suo motu power under the first limb of the sub-section, if the complaint is made by a single member or by members falling short of 1/3rd are hereby overruled. The view expressed by the learned judges in the second decision that the Section would be rendered nugatory if on the basis of complaint made by less than 1/3rd of the members an enquiry is set in motion by him is, with great respect, not acceptable, in fact, the provision will become ineffective if not nugatory in case such view is approved. We may also mention that in the latter case, the learned judges were influenced by the fact that the ratio of the decision in mahila seva samaj case was approved by another division bench in a. s. kupparaju's case. Whether that assumption is correct or not, we shall advert to a little later. Irrespective of that, we cannot endorse the reasoning and the conclusion arrived at in srintuasa rao's case. We therefore, over-rule the two decisions aforementioned and affirm the view taken in muslim co-operative bank's case, ( 17 ) WHAT remains for consideration is the decision in as. Kupparaju's case. In that case, the registrar directed and enquiry into, the working of the society by nominating an enquiry officer on the basis of representation submitted by a non-member. 'raju kshatriya welfare association', which at one point of time promoted the interests of the registered society by name andhra kshatriya maha samooham, it was contended that the registrar could not have acted upon the representation of the association as it was neither a member not did it represent the majority of the governing body or 1/3rd of the members of the society. The decision in mahila seva somaj case ws relied upon on behalf of the petitioner. The division bench correctly analysed the various ingredients of Section 25 (1) of the act. Which we have adverted to earlier. We would like to quote the observations at paragraph 10 of the judgment. The decision in mahila seva somaj case ws relied upon on behalf of the petitioner. The division bench correctly analysed the various ingredients of Section 25 (1) of the act. Which we have adverted to earlier. We would like to quote the observations at paragraph 10 of the judgment. "the significant feature to notice in the exercise of the power to hold a enquiry or direct the holding of an enquiry is in the employment of the expressions "may" and "shall" in the language of Section 25 (1) of the act. 'may', occurring just before "on his own" clearly indicates the directory nature i. e, if and when he acts on his own upon or with reference to information or material gathered by him from whatever source or sources, he has the discretion to hold or not to hold an enquiry or direct the holding of it or not holding it by person authorised by him. On the other hand, if it is a case falling either under the second or the third occasion indicated by us, that discretion is taken away by the legislature and the registrar is mandated to hold the enquiry or direct the holding of it by person authorised by him. For this reason in Rule 8 of the rules reference is made to the application that is required to be made relating to the latter two occasions when the power is to be exercised. "the learned judges then rejected the contentions of the learned counsel for the petitioner and proceeded to consider the next question whether the enquiry was vitiated by violation of principles of natural justice. The division bench fond substance in the contention of the petitioner's counsel that the petitioner had no opportunity to present its case on merits and certain material informations which were obtained behind the back of the petitibner were relied upon in the report. In the penultimate paragraph of the judgment, the manner in which the suo motu power has to be exercised by the registrar was outlined by the learned judges in the following words :"but we add that when the registrar acts suo motu or on his own upon whatever material available other than a complaint by members of the society or the governing body without the requisite majority prescribed to him to exercise his power under Section 25 (1) of the act. He must do so only after due application of mind and disclosure of material upon which he is acting and that must be explicit in the order he is required to make. Such an order cannot be capricious or without proper examination and investigation of the material upon which he proposes to act lest such action becomes arbitrary. "it becomes evident that the ratio of the decision in kupparaju's case, far from supporting the contention advanced on behalf of the petitioner in the instance case, runs counter to that contention. The only ground which led to the quashing of the enquiry report, was not the lack, of competence to hold enquiry, but denial of fair opportunity. But, the difficulty is created by the following observation made immediately after analysing the provision namely, Section 25 (1): "understood thus, we do not see any error of construction or interpretation of Section 25 (1} of the act in mahila seva samajs case which requires further consideration or reconsideration. " it is here, we should point out, that the observations are inaccurate and too broadly made. Though in the first apart of mahila seva samaj's case, the learned single judge correctly analysed the relative scope of various parts of Section 25 (1) and the nature of duty cast on the registrar, the ultimate conclusion rested on the fact that the registrar proceeded to hold an enquiry only on the application made by three members of the society, who fell short of 1/3rd of total members of the society. It is this conclusion that should have been faulted by the division bench in the light of the view-point which the division bench had itself taken. However, the division bench made a wide observation which is somewhat off the mark, apparently suggesting that a right-conclusion was reached in mahila seva somaj's case. To this extent, we must hold that the said observation does not reflect the correct legal position clarified by the learned judges themselves. ( 18 ) THE decision in a. s. kupparaju's case was followed by the division bench in sreenivasa rao's case. To this extent, we must hold that the said observation does not reflect the correct legal position clarified by the learned judges themselves. ( 18 ) THE decision in a. s. kupparaju's case was followed by the division bench in sreenivasa rao's case. In sreenivasa rao's case, the learned judges having regard to the observations in kupparaju's case to the effect that mahila seva samaj case laid down the law correctly held that the registrar cannot take any action on the basis of the complaint made by less than 1/3rd of the total number of members of the society. Though it was commented by the learned judges that any other interpretation would render the Section nugatory, no reasons were given in support of such view-point. The learned judges did not consider whether there is any dichotomy between the power confided to the registrar to act on his own motion arid the invocation of such power by some members falling short of 1/3rd of the strength of the society. Moreover, the true import and ratio in a. s. kupparaju's case was not appreciated by their lordships. For all these reasons, we are unable to place our seal of approval on the decision in sreenivasa rao's case. That decision insofar as the first question considered therein, is hereby over-ruled. ( 19 ) FINALLY, we may refer to a division bench decision of the Andhra Pradesh high court in M. W. Union V. R. Apparao, AIR 1970 ap 220 . The interpretation of Section 64 (a) of the old Motor Vehicles Act which contained the expression "may of its own motion or on an application made to it" fell for consideration. The learned judges rejected the contention that on the basis of a time barred application filed by the party suo motu power of revision could not have been exercised by the state government. The learned judges held :"we fail to see anything either in Section 64-a or in Rule 195, which prevents the government from taking suo motu action, when it comes to know of a defective order or proceeding of a lower authority, through a petition filed by an aggrieved party though it is not maintainable on account of bar of limitation or is otherwise irregular. "then, it was observed :"the filing of an unmaintainable application by an aggrieved party cannot alter the situation and take away the power of the government to act suo motu. After all the application which is irregular and not maintainable for some reason or other could be a source of knowledge for the government of the incorrect order. Once it comes to know of an Order, either through the application of a aggrieved part or in some other way, the government can exercise its power suo motu. "this decision fortifies our view that the exercise of powers suo motu or on own motion cannot be fettered or foiled by the fact that the specified authority takes into account the informations disclosed in the petition filed before him may be by a member or even a non-member of the society. ( 20 ) IN the light of the above discussion, we record our conclusion that the enquiry held by the registrar of societies is well within his jurisdiction. The registrar acted on the his own notion after considering the petition filed by certain members and the inspection report for 1994-95. ( 21 ) THE learned counsel for the petitioner has also contended hat the opportunity of hearing was not given and the recommendation was made to the government to appoint an administrator without proper application of mind. On a perusal of the order and the copy of the notes of proceedings furnished by the petitioner's counsel, we find no substance in this contention. ( 22 ) THOUGH the impugned order passed by the registrar cannot be said to be vitiated by the denial of reasonable opportunity or by any other serious defect in the decision making process, we would like to observe that in view of the long passage of time since the date of the order passed by the registrar or societies, the government has to take note of the subsequent events and reach a decision on the expediency of appointing administrator at this stage. It is also made clear that the question whether any and what action has to be taken against the persons responsible for serious lapses and delinquency would depend upon the reappraisal by the government of the aspects highlighted by the registrar. ( 23 ) WRIT petitions are dismissed without costs with the observations made in the preceding para. --- *** --- .