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2008 DIGILAW 458 (KAR)

N. G. Samaraju v. V. V. Patil

2008-08-29

D.V.SHYLENDRA KUMAR

body2008
Judgment :- (This writ petition is filed under Article 226 and 227 of the Constitution of India praying to quash the impugned order dated 112.2006 passed by the R8 as per Annexure D.) Writ petition by persons who held the post of President and Vice President of the Mysore Kirloskar Kelasagarara Sangha, who are aggrieved by an order passed by the 8th respondent – Assistant Registrar of Co-operative Society on 112.2006 (copy produced as Annexure-D to the Writ Petition), disqualifying the petitioners from holding the posts of President and Vice President respectively and also disqualifying them to hold such elected post for a period of 3 years from the date of the order in exercise of his power under Section 29(C) of the Karnataka Co-operative Societies Act, 1959. 2. Petitioners though have remedy of appeal to the higher authority namely the Deputy Registrar, as pointed out by the learned Government Pleader appearing for 8th respondent and Sri Mahesh Uppin, learned counsel appearing for respondents 1 to 6 have by passed the appellate remedy and have come up with the present Writ Petition, contending, inter alia, that the impugned order has been passed without affording an opportunity to the petitioners; that even though a request had been made to engage the services of a counsel, such a request is declined in terms of the endorsement dated 112.2006 [copy at Annexure-E]; that the vakalat though had been presented by the petitioners’ lawyer much before the date of hearing, refusing to accept the vakalat and issuing an endorsement after the disposal of the case is in clear violation of the principles of natural justice; that certain documents had been created and the records built up to defeat the rights of the petitioners; that the order had come to be passed in violation of the principles of natural justice and it is required to be quashed. 3. Respondents had been put on notice. Respondents 1 to 6 – other directors of the society and who had petitioned the Assistant Registrar complaining against the petitioners are represented by Sri. Mahesh R. Uppin, learned counsel, respondent No. 7 - Society is represented by Sri. B.D. Belligundi, learned counsel and respondent No. 8 – Assistant Registrar is represented by Smt. Asha M. Kumbargerimath, learned Government Pleader. 4. Mahesh R. Uppin, learned counsel, respondent No. 7 - Society is represented by Sri. B.D. Belligundi, learned counsel and respondent No. 8 – Assistant Registrar is represented by Smt. Asha M. Kumbargerimath, learned Government Pleader. 4. In the statement of objections filed on behalf of respondents 1 to 6, it is averred, inter alia, that the petitioners had tried to suppress a resolution that had been passed by the committee in its meeting held on 9.2006 for holding the general body meeting of the society on 30.9.2006 and on the other hand the petitioners had pressurized the Secretary not to record the proceedings of the Meeting held on 9.2006 but to send a false report of the proceedings to the Assistant Registrar seeking for grant of time for six months to hold a General Body Meeting on the premise that there is law and order situation etc., that it was a clear misuse of their power to pressurize the Secretary to give a wrong version to the Assistant Registrar; that it is because of this, the Registrar had passed an order permitting postponement of the General Body Meeting for three months which otherwise would not have happened; that such conduct on the part of the petitioners which amounts to an act of fraud clearly attracts the provisions of section 29(8) (b) of the Karnataka Co-operative Societies Act, 1959 [for short ‘the Act’]; that the petitioners did not even care to attend the enquiry held by the Assistant Registrar; that there is no occasion to interfere with the order and the order being an appealable order, the writ petition should not be entertained and is to be dismissed. 5. Smt. Asha M.Kumbargerimath, learned Government Pleader has supported the order. .6. This petition was admitted for examination by issue of rule on 27.2008. Smt. Asha M. Kumbargerimath, learned Government Pleader was directed to produce records. The records have been placed before the corut. 7. 5. Smt. Asha M.Kumbargerimath, learned Government Pleader has supported the order. .6. This petition was admitted for examination by issue of rule on 27.2008. Smt. Asha M. Kumbargerimath, learned Government Pleader was directed to produce records. The records have been placed before the corut. 7. Notwithstanding the appellate remedy, the case is examined in writ jurisdiction as it is noticed that the respondent No. 8 has acted in gross violation of principle of natural justice, particularly, for the purpose of recording a finding of fraud against the petitioners and imposing a serious consequential order as at Annexure-D not only disqualifying the petitioners from holding the elected post as ‘President’ and ‘Vice-President’ of the Society but also disqualifying them from contesting for such post for a further period of three years. .8. I have heard Sri. Basavaraj, learned counsel for the petitioners, Sri. Mahesh R. Uppin, learned Counsel for the respondents No.1 to 6, Smt. Asha M. Kumbargerimath, learned Government Pleader appearing for respondent No.8. 9. While an order of disqualification in terms of section 29C [viii](b) of the Act is a very serious matter, particularly, on the allegation of the elected representative of the members of the society acting either in a fraudulent manner or gross negligent manner, the action under this provision is warranted only on convincing proof of an act of fraud by persons against whom an order of disqualification is to be passed. The provisions under section 29c of the Act which enables the Assistant Registrar to disqualify elected persons from holding their elected post and also disqualifying them fro future contests is a penal provision and has to be strictly construed. It is only after sufficient and adequate reasons and based on material on record such disqualification should be imposed and not either as a matter of course or in a casual manner. A penalty should be imposed only after providing an opportunity to persons against whom penalty is sought to be imposed and not without according a proper opportunity. 10. While the record indicate that the notice of enquiry dated 211.2006 to be held against the petitioners under the provisions of section 29c of the Act had been issued to the petitioners fixing the date of hearing on 12.2006 at 11 am, the records also discloses that the hearing actually did not take place on that day. 11. 10. While the record indicate that the notice of enquiry dated 211.2006 to be held against the petitioners under the provisions of section 29c of the Act had been issued to the petitioners fixing the date of hearing on 12.2006 at 11 am, the records also discloses that the hearing actually did not take place on that day. 11. The version of the petitioners is that they had given their written explanation along with supporting documents on 12.2006 through their advocate and that has been ignored by the eighth respondent. 12. Be that as it may, the enquiry and hearing said to have fixed for 12.2006 did not take place for the reason that the eighth respondent – Assistant Registrar was not available and it was adjourned to 112.2006. There is nothing on record to indicate that the petitioners were intimated of the adjourned date of hearing. On the other hand, the record indicates that some of the respondents 1 to 6 had attended the Meeting and they were aware of the adjourned date. 13. So far as the petitioners are concerned, it is their version that they had engaged the services of a counsel. .14. The record further indicate that on 112.2006, while the petitioners did not appear, respondents 1 to 6 appeared and so also the Secretary of the society who had admitted that he had written a letter to the Assistant Registrar wrongly indicating the resolution of the Committee in the Meeting held on 9.2006; that the Secretary wrote such misleading letter at the instance of the petitioners – President and Vice-President and on their pressure. It is on such basis, the Assistant Registrar concluded against the petitioners that the petitioners having acted contrary to the wishes of the .majority of members of the Committee who participated in the Meeting held on 9.2006 and having pressurized the Secretary to send a wrong report to the Registrar, they are guilty of misrepresentation, committing an act fraud and violating the statutory provisions and bye-law of the society and therefore they are liable for action in terms of section 29c(8) (b) of the Act and order of disqualification. 15. 15. Smt. Asha Kumbargerimath, learned Government Pleader while supporting this order has also submitted that if the Assistant Registrar has declined to permit the Advocate for the petitioners to appear before him in the enquiry it is fully justified for the reason that for availing the services of a lawyer in the enquiry before the Assistant Registrar, the concerned persons should have made an application in terms of Rule-55 of the Karnataka Co-operative Societies Rules, 1960 and the Advocate cannot file vakalat directly and the Advocate will be permitted to appear on behalf of a party if permission had earlier been granted on an application made under rule-55 of the Rule and therefore the action on the part of the Assistant Registrar in not accepting the vakalat presented on behalf of the petitioners is very correct; that it cannot be construed as an act of denial of opportunity to the petitioners; that they had not availed of the opportunities in a proper manner and on the other hand remained absent on the date of enquiry. 10.16. A perusal of the records does not inspire the confidence of this court to say that the proceedings had gone on in a bona fie or proper manner. The proceedings indicate that the hearing date had been fixed on 12.2006 and it had been adjourned to 112.2006 due to the absence of the Presiding officer. There is no record to indicate that the petitioners were apprised of the adjourned date of hearing. On the other hand, the endorsement at Annexure-E purporting to decline permission to the Advocate of the petitioners to appear before the Assistant Registrar is issued on 112.2006 though the Vakalat according to the petitioners had been presented before the Assistant Registrar as on 12.2006 along with the explanation offered by the petitioners in response to the show cause notice. There is no mention of reference to the explanation offered by the petitioners in the order. Even if the Advocate is not permitted to appear, nothing prevents the Assistant Registrar from looking into the reply given by the petitioners to the show cause notice. There is no mention of reference to the explanation offered by the petitioners in the order. Even if the Advocate is not permitted to appear, nothing prevents the Assistant Registrar from looking into the reply given by the petitioners to the show cause notice. More strangely, the endorsement declining the permission to the Advocate to appear in the matter on behalf of the petitioners is issued on 112.2006 subsequent to the disposal of the matter on 112.2006 and very strangely there is not even a mention in the endorsement dated 112.2006 that the matter has already been disposed of. The record does not contain more than the proceedings recorded on two dates in respect of hearing of the case, one dated 12.2006 and the other dated 112.2006. The endorsement issued in terms of Annexure-E dated 112.2006 also is by the very Assistant Registrar who had passed in impugned order at Annexure-D. If an order had come to be passed on 112.2006 as indicated in the record, there is absolutely no reason as to why it was not so mentioned in the endorsement dated 112.2006 issued by the very Assistant Registrar while declining permission for the appearance of the Advocate on behalf of the petitioners. 117. Two inferences are inevitable from this course of the conduct on the part of the eight respondent – Assistant Registrar. One denying an effective opportunity to the petitioners to present their case more so in not even making a reference to the reply and responding to the petitioners’ intention of availing the services of an Advocate by issuing an endorsement after disposal of the case and declining the permission and the other, a more serious inference is that the record does not inspire the confidence that the order had come to passed on 112.2006 as indicated. If the order should have been passed on 112.2006, the first thing should have been mentioning that in the endorsement dated 112.2006. It leaves a strong impression that the order is one passed subsequent to 112.2006, but anti-dated as 112.2006. An Assistant Registrar conducting in such a manner while exercising a very potent power in terms of section 29C of the Act deserves strong deprecation of his conduct at the hands of this court. 18. It leaves a strong impression that the order is one passed subsequent to 112.2006, but anti-dated as 112.2006. An Assistant Registrar conducting in such a manner while exercising a very potent power in terms of section 29C of the Act deserves strong deprecation of his conduct at the hands of this court. 18. The power is not only misused but abused only at the instance of the respondents 1 to 6 who are the architects of the entire proceedings. The effect of the order at Annexure-D is to deprive the elected office bearers not only of their elected post but to disqualify them for further three years from either holding or contesting for the same. Respondents 1 to 6 are rivals to the petitioners and there is no reason as to why the eight respondent should be passing such whimsical, arbitrary and cooked up orders on his own unless it is at the behest of the respondents 1 to 6. 19. The irony in this case is that the petitioners were sought to be disqualified on the ground of committing an act of fraud in terms of the provisions section 29c(8) (b) of the Act, but examination of the case, pleadings and perusal of the records indicates on the other hand it is the respondents 1 to 6 in collusion with the respondent No. 8 who have perhaps acted in a fraudulent manner and to bring about cooked up or anti-dated order to the detriment of the petitioners. 20. I have no doubt in my mind that the respondent No. 8 has clearly misused the powers vested in him and the order at Annexure-D is not sustainable for more than one reason. The order dated 112.2006 passed by the eighth respondent [copy at Annexure-D] is quashed by issue of a writ of certiorari. 21. The Registrar of Co-operative Societies is hereby directed to hold an enquiry into the conduct of the eighth respondent-Assistant Registrar in passing an order at Annexure-D, particularly in the light of the observations made by this court and as to whether the Assistant Registrar had actually passed the order even on 112.2006 at all and on the other hand it is so made to look in the record. 22. The Registrar is to take the enquiry to its logical conclusion depending on the outcome of the enquiry. 22. The Registrar is to take the enquiry to its logical conclusion depending on the outcome of the enquiry. So far as the respondents 1 to 6 are concerned, they will have to be mulcted with costs for initiating action which in my opinion was totally unwarranted against the petitioners for disqualification under section 29C(8) (b) of the Act. Obviously, the respondents 1 to 6 were keen to ensure such disqualification was heaped on the petitioners and have achieved their object in terms of the impugned order at Annexure-D. 23. Therefore, this writ petition is allowed imposing cost of Rs. 2,000/-each on the respondent 1 to 6 payable to the petitioners. Cost if not deposited by the respondent 1 to 6 before this court within six weeks from today, registry directed to issue a certificate in favour of the petitioners for recovery of the amount as though it is a decree passed by the civil court. Petitioners to share the cost awarded in their favour. Writ petition allowed. Rule made absolute.