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2009 DIGILAW 269 (GUJ)

Piplav Seva Sahakari Mandli Ltd. v. State of Gujarat

2009-04-16

H.N.DEVANI, M.S.SHAH

body2009
Judgment Mohit S. Shah, J.—This appeal under Clause 15 of the Letters Patent is directed against the judgment and order dated 05.09.2007 of the learned Single Judge dismissing the writ petition challenging the interim order and the proceedings under Section 107(3) of the Gujarat Co-operative Societies Act, 1961. 2. In view of the order that we propose to pass, it is not necessary to set out all the facts in detail. Suffice it to state that the District Registrar, Co-operative Societies, Anand - Respondent No. 3 herein issued show-cause notice dated 17.07.2006 (Annexure ‘D’) calling upon the Appellant No. 1 Society (hereinafter referred to as ‘the appellant Society’) to show cause as to why the appellant Society should not be taken into liquidation and orders may not be passed under Section 107(1) of the Act. The Chairman, Secretary and members of the Managing Committee of the appellant Society were required to remain present alongwith all the relevant record of the Society and books of accounts before the District Registrar on 24.07.2006 at 12.00 noon. The appellant Society prayed for adjournment and the District Registrar vide letter dated 27.07.2006 (Annexure ‘F’) granted time up to 03.08.2006 for filing reply. In the meantime on 01.08.2006, the Chairman of the appellant Society submitted an application dated 01.08.2006 (Annexure ‘H’) requesting for further adjournment on the ground of heavy rains in the area and, therefore, it would not be possible to attend the office of the District Registrar on the date of adjournment. The District Registrar, however, held that the appellant Society was trying to avoid tendering of reply on merits on one or the other ground and hence on different grounds stated in the order dated 10.08.2006 came to the conclusion that the appellant Society was required to be taken into liquidation under Section 107(1) of the Act. It was further indicated in the order that the said order was interim order, in the event the appellant Society was inclined to place any facts or evidence on record, either in writing or orally, it was open to do so within a period of one month from the date of the order and that in absence of any satisfactory reply, final order for winding up of this appellant Society shall be made. The appeal against the said order came to be dismissed by the appellate authority by order dated 17.10.2006 and the revision came to be dismissed by the revisional authority on 09.04.2007. 3. The writ petition filed by the appellant Society came to be dismissed by the learned Single Judge by judgment dated 05.09.2007. Hence, this appeal. 4. Mr. B.S. Patel, learned Counsel for the appellant has submitted that in the first week of August, 2006, there were heavy rains in the State of Gujarat including Anand District and, therefore, an application for adjournment was submitted to the District Registrar specifically mentioning that on account of heavy rains, it was not possible for the appellant Society to remain present on 03.08.2006. It is submitted that the appellant Society was not informed that the request was rejected; that the Chairman of the appellant Society was informed that the matter would be posted for hearing on 14.08.2006 and, therefore, the appellant Society proceeded on that basis. Hence, it was shocking to learn that the District Registrar, Anand passed the impugned order on 10.08.2006. 5. Mr. Patel further submitted that in another matter arising from the same village, the learned Single Judge observed in judgment dated 13/14.03.2007 in Special Civil Application No. 19340 of 2006 that the petitioner in that case was also granted time up to 03.08.2006 for submitting reply and in that case also, the application was made on 01.08.2006 for adjournment on the ground of heavy rains. So also, the District Registrar passed order dated 10.08.2006 adverse to the said petitioner and that Special Civil Application came to be allowed by the learned Single Judge on the ground that in absence of the reply of the petitioner on merits, thereupon causing prejudice to that petitioner, the direct consequence being removal from membership of the Managing Committee. The learned Single Judge further observed that the authorities had failed to place on record any evidence to disprove the ground on which adjournment was sought for by the petitioner, namely, heavy rains. It is, therefore, submitted by Mr. B.S. Patel that the appellant Society is similarly situated as the petitioner in the said petition. 6. On the other hand, Ms. It is, therefore, submitted by Mr. B.S. Patel that the appellant Society is similarly situated as the petitioner in the said petition. 6. On the other hand, Ms. Jirga Jhaveri, learned AGP has opposed the appeal and submitted that when the impugned order dated 10.08.2006 is merely an interim order and it is open to the appellant to submit a reply and get the order dictated, it is not necessary to interfere with the interim order dated 10.08.2006. 7. In rejoinder, Mr. Patel submitted that in Apexa Co-op. Bank Ltd. vs. District Registrar and Others [ 1993 (2) GLH 861 ], a Division Bench of this court has already examined the scope and ambit of the power of the District Registrar under Section 107 of the Act and has enunciated the important principles. It is also submitted that it has been held in the said decision that order under Section 107(1) cannot be passed without examining the possibilities of resorting to less drastic action under the Act. 8. Having heard the learned Counsel for the parties, this Court is not required to examine the challenge to the legality of the order dated 10.08.2006 of the District Registrar on merits. As held by this Court in Apexa Co-operative Bank Ltd.’s case (Supra), winding up is the process whereby the life of the Society is ended and such a step would ordinarily be taken only if the alternatives provided by the various other provisions of the Statute are found to be inadequate to infuse healthy life in an erring or defaulting Society. 9. It is clear from the order-sheet that while admitting the appeal on 12.09.2007, this Court directed the parties to maintain status quo after recording the statement of learned advocate for the applicant that the appellant Society is functional and that ad-interim relief is continued from time to time and today also, interim relief is operating. 10. Having regard to the fact that the Society had prayed for adjournment on 01.08.2006 on the ground of heavy rains in the area and that the case pleaded by another petitioner of the same village was accepted by the learned Single Judge in Para 8 of the judgment dated 13/14.03.2007 in Special Civil Application No. 19340 of 2006, we are of the view that the appellants herein may also be granted another opportunity to file its reply to the show-cause notice dated 17.07.2006. For this reason alone, without going into the merits of the controversy between the parties, we set aside the impugned order dated 10.08.2006 (Annexure ‘A’), the appellate order dated 17.10.2006 (Annexure ‘B’) and the revisional order dated 09.04.2007 (Annexure ‘C’) and we remand the matter back to the District Registrar of the Co-operative Society, Anand - Respondent No. 3 herein for taking a fresh decision in the matter after giving the appellant one opportunity to file reply, if any, within one month from today i.e. by 15.05.2009. Thereafter, Respondent No. 3 shall take fresh decision in the matter in accordance with law after giving the appellant a reasonable opportunity of being heard. It is clarified that it will be open to the appellant Society to point out any subsequent developments in the matter also. 11. The appeal is accordingly allowed. Civil Application No. 11905 of 2007 Since the appeal is allowed, this Civil Application for stay does not survive and is disposed of accordingly.