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Madhya Pradesh High Court · body

2009 DIGILAW 1256 (MP)

Nirvachit Sanchalak Mandai Vipdan Sahakari Sanstha Mydt. Vidisha v. Dy. Registrar Cooperative Societies, Vidisha

2009-11-10

A.P.SHRIVASTAVA, S.SAMVATSAR

body2009
ORDER 1. Heard counsel. 2. This writ petition is filed by the petitioner society under Article 227 of the Constitution of India challenging the order dated 30.7.2009 passed by Madhya Prades:h State Co-operative Tribunal, Bhopal in Second Appeal No. 122/09 whereby the appeal filed by the petitioner society challenging the order dated 18.5.2009 passed by Joint Registrar, Co-operative Societies, Bhopal in case No. 78-87/08 was dismissed. 3. Facts of the case, briefly stated are that elections of the petitioner society were held on 15.12.2001. Action was taken against the said society under section 53 (2) of the M.P. Co-operative Societies Act (herein after, referred to as the "Act") for supersession of the society on 10.1.2003. Final order was challenged before the Tribunal in First Appeal No. 2005/04. The Tribunal set aside the said matter and the matter camp up before the High Court in Writ Petition No. 4494/06. The High Court vide order dated 9.10.2006 directed to restore the Board. 4. Subsequently notice Annexure P 16 was issued to the society under section 19 ( c) Sub-Section 2 of the Act. This notice was challenged by the petitioner by filing writ petition No. 6402/06 which was dismissed by this Court vide order dated 9.8.2007. On 19.7.2007 an order was passed disqualifying the chairman of the society. Said order was challenged before the Tribunal by Chairman Raghveer Singh Raghuvanshi. The Tribunal vide order dated 28.7.2007 set aside the order dated 19.7.2007 passed by the Joint Registrar, Co-operative Societies disqualifying the Chairman. On 12.4.2007 Returning Officer was appointed under section 41 (6) of the Act for holding elections. This order was, however, stayed by this Court vide order dated 10.8.2007 passed in MCC 572/07 which is still pending. 5. Subsequently, the Deputy Registrar, Co-operative Societies, Vidisha passed order dated 1.9.2007 under section 53 (13) of the Act which is Annexure P/3. Section 53 (13) of the Act provides that if the Committee of society ceases to function due to order of any Court or otherwise, the Registrar may appoint a person or committee of persons temporarily till the Court order is vacated or the new elections are held and the Committee takes charge. Thus, under this section, there is a provision of constituting a committee if the committee of the society ceases to function under order of Court or otherwise. 6. Thus, under this section, there is a provision of constituting a committee if the committee of the society ceases to function under order of Court or otherwise. 6. In the case in hand, while passing the order Annexure P/3, the Deputy Registrar, Co-operative Societies has assigned reason that the quorum of the Board is not complete. It was held by the Deputy Registrar that as per byelaws of the society there are 18 directors in the society out of which six are nominated by the State Government and 12 are elected members. He found that out of 12, one seat was vacant and ten members were disqualified. Thus, even if one elected member and six nominated members of the Board are present, still the quorum of Board of Directors is not complete. It was pointed out by the Deputy Registrar, Co-operative Societies that as per byelaw 32 (1) of the Society, quorum of eight members is necessary for taking any decision. He, therefore, found that in the absence of quorum, no committee can function. Hence, he appointed one Anil Kumar Rawat to take charge of the society. 7. Said order passed by the Deputy Registrar, Co-operative Societies was assailed by the present petitioner before the Joint Registrar, Co-operative Societies by filing appeal No. 78-87/08-09. This appeal was dismissed by the Joint Registrar vide order dated 18.5.2009 (Annexure P/2). The order passed by the Joint Registrar, Co-operative Societies was further challenged by the present petitioner before the Cooperative Tribunal by filing second appeal No. 122/09. The Tribunal dismissed the said second appeal by order dated 30.7.2009 (Annexure P/1). Hence, this writ petition. 8. First contention raised by Shri Raghvendra Dixit, learned counsel for the petitioner is that the orders passed by the Joint Registrar, Co-operative Societies, Deputy Registrar, Co-operative Societies and the Tribunal are illegal and cannot be sustained. Shri Vivek Khedkar learned Government Advocate appearing for the respondents State, on the other hand, supported the said orders. 9. It is contended by Shri Dixit, learned counsel for the petitioner that all the three authorities have committed error in holding that the quorum of the Governing body of the society was not available. He also submitted that some members were co-opted by the society by passing resolution Annexure P/15. This resolution was passed after service of notice to the Deputy Registrar for appointing an election officer. He also submitted that some members were co-opted by the society by passing resolution Annexure P/15. This resolution was passed after service of notice to the Deputy Registrar for appointing an election officer. First notice is dated 24.10.2006 (Annexure P1 12) and second one is dated 30.3.2007 (Annexure P/13). Despite these notices, since no election officer was appointed, the society co-opted few new members and after counting the co-opted members of the society, the quorum of the Board is complete and as such, the order passed by the authorities are illegal and contrary to law. 10. From perusal of the resolution (Annexure P/l5), it appears that on 15.8.2007 a resolution was passed by eight members of the society. This resolution shows that one Shrimati Jamnabai, Narnedra Singh and Kamaljeet Singh were co-opted as members of the Board of Directors and if these persons are counted, then the quorum of the Board is complete. 11. In reply to the argument advanced by the learned counsel for the petitioner, Shri Vivek Khedkar, learned Government Advocate appearing for the respondents-State contended that out of the eight members who were present in the meeting dated 15.8.2007, three members were already declared disqualified to be the members of the Board and, therefore, even if these members were present, still the quorum of the Board of Directors was not complete and as such, the resolution of co-option itself is illegal. He invited attention of this Court to Annexure P/3 order passed by the Deputy Registrar, Co-operative Societies which shows that out of eight members present in the meeting dated 15.8.2007, one Sitaram Shivhare was declared disqualified vide order dated 2.12.2006. Similarly, Randhir Singh Ji Thakur, Bharat Singh . Ji and Laxman Singh were also declared as disqualified and were not found eligible for participating or voting in the meeting. In such circumstances, the resolution dated 15.8.2007 itself has become illegal and as such, the option of Shrimati Jarnnabai, Narander Singh and Kamaljeet Singh also rendered illegal. 12. Shri Dixit, learned counsel for the petitioner, on the other hand, contended that the State Government has not placed any order declaring these members as disqualified. He contended that for declaring any member to be disqualified, the procedure provided in section 48-A of the Act is to be followed. 12. Shri Dixit, learned counsel for the petitioner, on the other hand, contended that the State Government has not placed any order declaring these members as disqualified. He contended that for declaring any member to be disqualified, the procedure provided in section 48-A of the Act is to be followed. In absence of any material on record to show that these-members were disqualified after following proper procedure, it cannot be said that these members were disqualified on 15.8.2007 when three persons were co-opted by the society. 13. From perusal of the record, we find that the State Government has not produced any record declaring that these persons were disqualified from the membership of the Board of Directors. There is nothing on record to show that the procedure as contemplated under section 48-A of the Act was ever followed. 14. From perusal of the orders passed by the Deputy Registrar, Cooperative Societies, Joint Registrar, Co-operative Societies and the Tribunal, it does not appear that any such record was produced before any of these authorities. 15. Apart from that, from perusal of the impugned order passed by the Tribunal, it appears that the Tribunal has held that no opportunity of hearing is necessary before passing orders under section 53 (13) of the Act. 16. Shri Khedkar, learned Government Advocate appearing on behalf of the respondent State contended that in view of the judgment of the apex Court in the case of S.L. Kapoor v. Jagmohan and others, AIR 1981 SC 136 no opportunity of hearing is necessary when the facts are admitted and no prejudice is caused to the concerning party. In the case before us, the dispute was whether or not four to five members who had attended the meeting dated 15.8.2007 were already disqualified. This was a disputed question of fact which required investigation by the authorities. 17. The apex Court in the case Rajesh Kumar and others v. Dy. CIT and others, (2007) 2 SCC 1 S 1 has laid down that the principles of natural justice are based on two basic pillars - (i) Nobody shall be condemned unheard and (ii) Nobody shall be judge of his own cause. Same principles have been reiterated by the apex Court in its judgment in the case of Sahara India (Firm) Lucknow v. Commissioner of Income Tax Central - I and others, (2008) 14 SCC 151. 18. Same principles have been reiterated by the apex Court in its judgment in the case of Sahara India (Firm) Lucknow v. Commissioner of Income Tax Central - I and others, (2008) 14 SCC 151. 18. In the present case, as per the findings of the Tribunal itself, no opportunity of hearing was afforded to the society before passing the order under section 53 (13) of the Act. 19. In the case of Union of India v. E.G. Nambudiri, AIR 1991 SC 1216 , question before the apex Court was whether principles of natural justice required administrative authorities to record reasons. The apex Court has held that generally, principles of natural justice require that opportunity of hearing should be given to the person against whom an administrative order is passed. The application of principles of natural justice, and its sweep depend upon the nature of the rights involved, having regard to the setting and context of the statutory provisions. Where a vested right is adversely affected by an administrative order, or where civil consequences ensue, principle of natural justice apply even if the statotury provisions do not make any express provisions for the same and the person concerned must be afforded opportunity of hearing before the order is passed. 20. In the instant case, in the absence of any statutory provision barring to provide opportunity of hearing, opportunity of hearing was necessary as the order passed by the Deputy Registrar, Co-operative Societies was based on facts which were disputed and required investigation. 21. In such circumstances, this petition stands allowed. Orders Annexure P/3, P/2 and P/1 passed by the Deputy Registrar, Co-operative Societies, Joint Registrar, Co-operative Societies and Co-operative Tribunal, Bhopal, respectively are set aside.