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2011 DIGILAW 1569 (BOM)

Ivo Almeida Coutinho v. P. M. Naik

2011-12-22

A.P.LAVANDE, R.P.SONDURBALDOTA

body2011
JUDGMENT A. P. Lavande 1.Heard Mr. D. Pangam, learned Advocate for the petitioners, Mr. S. S. Kantak, learned Advocate General for the respondent nos. 1 and 2, Mr. D. Lawande, learned Advocate for respondent nos. 3 to 7 and Mr. A. N. S. Nadkarni, learned Senior Advocate for respondent no.8. 2. Rule. By consent of the learned Counsel for the parties, heard forthwith. 3. Briefly, the case of the petitioners is as follows:- Respondent no. 8 Bank is a Co-operative Society registered under the Goa Co-operative Societies Act, 2001 ( “the Act” for short). Initially the society was registered under the Maharashtra Co-operative Societies Act, 1960 as applicable to the State of Goa and after coming into force of the Act, respondent no. 8 continues to be a Co-operative Society registered under the Act. 4. In terms of byelaw 29 as amended vide Memo dated 7/2/2008, the affairs of the bank are managed by the Board of Directors constituting nine duly elected directors from amongst the members and one director shall be representative of the Apex Finance Bank, if any. Bye-law further provides that the elected directors can co-opt two additional directors from the category of Chartered Accountant and Ex- Banker. However, they will not have voting rights. The Chief Executive Officer is an Ex-officio member of the Board of Directors who is not entitled to vote in any of the meetings of the Board of Directors of the bank. 5. Petitioners and respondent nos. 3, 4, 5 and 6 were elected as directors of the bank in the election held on 28/1/2007. Respondent no. 7 has been co-opted as a member of the Board of Directors. 6. On 21/9/2010, the respondent nos. 3 and 4 were elected as Chairman and Vice-Chairman respectively of the bank. According to the petitioners, respondent nos. 3 and 4 resorted to several illegalities and irregularities which were against the interest of the bank. As such, the petitioners issued requisition notice dated 22/6/2011 under Section 59A(2) of the Act to the respondent no. 2 requesting to convene a special meeting of the Board of Directors of the bank for consideration of no confidence motion against respondent nos. 3 and 4. Pursuant to the said requisition notice respondent no. As such, the petitioners issued requisition notice dated 22/6/2011 under Section 59A(2) of the Act to the respondent no. 2 requesting to convene a special meeting of the Board of Directors of the bank for consideration of no confidence motion against respondent nos. 3 and 4. Pursuant to the said requisition notice respondent no. 2 issued notice dated 24/6/2011 fixing the special meeting of the Board of Directors of the bank on 7/7/2011 at 11.00 a.m in the head office of the bank at Aquem, Margao, Goa to consider the no confidence motion against respondent nos. 3 and 4. Respondent no. 2 authorised respondent no. 1 to preside over the meeting as required under Section 59A of the Act. 7. On 7/7/2011, the petitioners remained present at the venue of the meeting convened by respondent no. 2. Respondent no.1 who was authorised to preside over the said meeting was also present. Respondent no.1 held that since only five directors were present there was no quorum and as such the motion of no confidence against the respondent nos.3 and 4 stood rejected. Petitioners have placed on record minutes of the meeting dated 7/7/2011 (Exh. D). It is further case of the petitioners that they informed respondent no.1 that in the special meeting convened under Section 59A of the Act only elected members were entitled to participate and vote and what is contemplated is only passing of the no confidence motion by simple majority amongst the directors who are entitled to vote, in any such meeting. Since only 9 directors were entitled to vote five members constituted a simple majority as contemplated under Section 59A. However, respondent no.1 did not allow the petitioners to table no confidence motion on the ground that there was no quorum. The respondent no.1 has recorded in the minutes of the meeting that since there was no quorum no confidence motion stood rejected. 8. Petitioners have challenged the minutes of the meeting dated 7/7/2011 and have sought direction against respondent nos.1 and 2 to convene a fresh special meeting in terms of Section 59A of the Act of the Board of Directors of the Bank. 9. On behalf of respondent no.8, an affidavit has been filed opposing the petition on several grounds. 8. Petitioners have challenged the minutes of the meeting dated 7/7/2011 and have sought direction against respondent nos.1 and 2 to convene a fresh special meeting in terms of Section 59A of the Act of the Board of Directors of the Bank. 9. On behalf of respondent no.8, an affidavit has been filed opposing the petition on several grounds. Reliance has been placed on byelaw no.35 of the bank which postulates that quorum for transaction of any business by the Board of Directors shall be half the number of the total strength of the Board of Directors plus one. According to respondent no.8, the quorum for the said meeting was six and since only 5 directors were present, there was no quorum and as such it was rightly held by respondent no.1 that motion of no confidence against respondent nos.3 and 4 stood rejected. It is further the case of respondent no.8 that all the rules governing ordinary meeting of the Board of Directors are also applicable to special meeting of the Board of Directors convened under Section 59A of the Act for considering vote of no confidence. 10. Respondent no.4 has also filed an affidavit in which the stand similar to the stand taken by respondent no.8 is taken. 11. On behalf of respondent no.8, Kishor Narvekar- respondent no.3 has filed an additional affidavit. 12. Respondent no. 3 has filed an additional affidavit to bring on record certain subsequent events. In the said affidavit, it has been stated that the General Manager of the bank has addressed a letter dated 22/7/2011 to the Assistant Registrar in respect of the quorum of the board meeting of the bank. In reply dated 11/8/2011 to the said letter, the Assistant Registrar has informed the bank that the presence of the Chief Executive Officer of the bank, who is also the Ex-Officio member of the Board, cannot be considered for the purpose of the quorum for the meeting of the elected members of the Board of Directors, he being paid officer of the Bank. 13. Mr. Pangam, learned counsel for the petitioners submitted that in view of subsection (5) of Section 59A of the Act special meeting convened cannot be adjourned or aborted for any reason, including the reason that there was no quorum. Alternately, Mr. 13. Mr. Pangam, learned counsel for the petitioners submitted that in view of subsection (5) of Section 59A of the Act special meeting convened cannot be adjourned or aborted for any reason, including the reason that there was no quorum. Alternately, Mr. Pangam submitted that even if it is held that quorum is required for special meeting convened under Section 59A of the Act, the same cannot exceed simple majority from amongst those directors who are entitled to attend and vote in the said meeting. Mr. Pangam submitted that even if respondent no.1 was to hold that there was no quorum he could not have rejected the no confidence motion tabled by the petitioners as against respondent nos.3 and 4 who are in minority since respondent nos.3 and 4 had the support of four members including themselves whereas the petitioners who are five in numbers had reposed no confidence in respondent nos.3 and 4. According to Mr. Pangam, Section 59A is a complete code by itself and the same prevails over the byelaws of the Bank which have no statutory force. According to Mr. Pangam, Section 59A prescribes the manner in which no confidence motion has to be dealt with by the Presiding Officer appointed by respondent no.2 and meeting held under Section 59A being a special meeting and not ordinary meeting, byelaw 35 is not applicable. According to learned Counsel the special meeting convened under Section 59A of the Act does not require any quorum, more particularly in view of the language of subsections (5) and (7) thereof. According to learned Counsel, the object under Section 59A is to discourage moving of no confidence motion again and again thereby disturbing the smooth functioning of the bank. According to Mr. Pangam, the petitioners who are five in numbers are entitled to vote and as such constitute simple majority amongst the elected directors and, therefore, respondent no.1 ought to have proceeded further and transacted the business. Mr. Pangam further submitted that byelaw 35 was framed in the year 1989 and after coming into force of Section 59A of the Act w.e.f. 23/9/2010 byelaws are saved provided they are not inconsistent with the provisions of the Act. According to learned Counsel byelaw 35 is inconsistent with Section 59A and therefore there is direct conflict between Section 59A and byelaw 35. According to learned Counsel byelaw 35 is inconsistent with Section 59A and therefore there is direct conflict between Section 59A and byelaw 35. According to the learned Counsel, if the quorum required under byelaw is mandatory, the same would render Section 59A inoperative, inasmuch as the petitioners who are in majority would not be in a position to oust respondent nos.3 and 4 from the post of Chairman and Vice-Chairman, although they do not have the support of majority. If byelaw 35 has to be applied even to a special meeting under Section 59A, the same would effectively prevent the majority of the elected directors from exercising their democratic right of voting because the meeting will be aborted on the ground that minimum number of directors required for quorum as required under byelaw 35 are not present. According to the learned Counsel, the action of respondent no.1 in declaring that the motion of no confidence was rejected is patently illegal and therefore the petitioners are entitled to the reliefs sought for in the petition. In support of his submissions, Mr. Pangam has placed reliance upon the Judgment of Division Bench of this Court (Aurangabad Bench) in Jayprakash Raosaheb Salunke and others Vs. State of Maharashtra and others, 2000(3) BCR 306. 14. Per contra, Mr. Kantak, learned Advocate General appearing on behalf of respondent nos.1 and 2 submitted that no fault can be found with the action of respondent no.1 in holding that the motion of no confidence was rejected since there was no quorum and is in consonance with the ratio laid down by this Court in unreported judgment of Division Bench of this Court dated 22.11.2007 in Writ Petition No. 527/2007, Pramod Raikar Versus Registrar of Co-operative Societies, and others. According to learned Advocate General, the ratio of the Judgment in the case of Pramod Raikar is squarely applicable in the present case inasmuch as Section 73(I) of the Maharashtra Co-operative Societies Act which came up for interpretation in the case of Pramod Raikar is pari mataria with Section 59A of the Act. According to the learned Advocate General, there is no conflict between Section 59A and byelaws of the Bank. According to the learned Advocate General, there is no conflict between Section 59A and byelaws of the Bank. According to learned Advocate General, respondent no.1 has rightly held that the quorum required for the special meeting was six and in any case respondent no.1 was bound to act in accordance with the Judgment delivered by this Court in Writ Petition No.527/2007. Learned Advocate General further submitted that the question of law involved in the case of Salunke relied upon by the petitioners is entirely different. 15. Mr. Nadkarni, learned Senior Counsel appearing on behalf of respondent no.8 submitted that no fault can be found with the minutes recorded by respondent no.1 and the action of respondent no.1 is in consonance with the judgment of Division Bench of this Court in the case of Pramod Raikar (supra). According to Mr. Nadkarni, the case of Salunke is clearly distinguishable on the facts and on law and in case if this Court was to hold that there is conflict between the two judgments rendered in the cases of Pramod Raikar and Jayprakash Salunke (supra), the appropriate course for this Court would be to refer the matter to a larger Bench. According to learned Senior Counsel, respondent no.1 was not only justified but was bound in law to follow the ratio in the case of Pramod Raikar (supra). He further submitted that the special meeting convened under Section 59A of the Act has to be in terms of byelaws of the Bank as held in the case of Pramod Raikar (supra) since the special meeting is like any other meeting. Mr. Nadkarni, invited our attention to Section 72 of the Act and submitted that quorum is also required for the meetings convened under Section 59A of the Act. Learned Senior Counsel further submitted that Section 59A cannot be construed as Code by itself and Section 72 is also applicable to a meeting convened under Section 59A in the absence of non obstinate clause in Section 59A. According to learned Senior Counsel, the petitioners have not thrown any challenge to byelaw 35 and as such, they are not entitled to contend that the byelaws are not applicable to the meeting convened under Section 59A of the Act. According to learned Senior Counsel, the petitioners have not thrown any challenge to byelaw 35 and as such, they are not entitled to contend that the byelaws are not applicable to the meeting convened under Section 59A of the Act. Learned Senior Counsel further submitted that the petitioners being members of the society are bound by the byelaws and unless the byelaws are modified or amended by seeking approval of the registrar under Section 11, the byelaws bind all the members of the bank, including the petitioners. According to learned Senior Counsel, byelaw 35 is not inconsistent with Section 59A of the Act and saved under Section 128 of the Act. Mr. Nadkarni further submitted that no fault can be found with the action of respondent no.1 in holding that no confidence motion stood rejected, since respondent no.1 could not have adjourned the meeting in view of subsection (5) of Section 59A. Mr. Nadkarni further submitted that the submission of Mr. Pangam that such interpretation would render Section 59A unworkable, is patently unsustainable in law. According to the learned Counsel, the meeting has to be held only if there is quorum. In support of his submissions, Mr. Nadkarni placed reliance upon the judgment of Madhya Pradesh High Court in the case of Than Singh and others Vs. State of Madhya Pradesh; AIR 2005 MP 170 , an unreported Judgment of Kerala High Court in the case of Thrivanchur Radhakrishnan Vs. State of Kerala and others (MANU/KE/0576/1996) and also the judgment of the Apex Court in the case of Zoroastrian Co-op. Housing Society Ltd. Vs. District Registrar, Co-op. Societies; 2005(5) SCC 632 . Mr. Nadkarni, further submitted that if there is a conflict between two Division Bench Judgments, a reference has to be made to a Larger Bench and one Bench cannot differ the judgment of another Co-ordinate Bench and the appropriate course would be to refer the matter to a Larger Bench. Mr. Nadkarni placed reliance upon the Judgments of the Apex Court in the case of State of Tripura Vs. Tripura Bar Association and ors. AIR 1999 SC 1494 and S. J. Rooplal and another Vs. Lt. Governor through Chief Secretary, Delhi and ors, AIR 2000 SC 594 . Mr. Lawande, learned Counsel appearing on behalf of respondent nos.3 to 7 adopted the arguments of Mr. Nadkarni, learned Senior Counsel appearing for respon dent no.8. 16. In rejoinder, Mr. Tripura Bar Association and ors. AIR 1999 SC 1494 and S. J. Rooplal and another Vs. Lt. Governor through Chief Secretary, Delhi and ors, AIR 2000 SC 594 . Mr. Lawande, learned Counsel appearing on behalf of respondent nos.3 to 7 adopted the arguments of Mr. Nadkarni, learned Senior Counsel appearing for respon dent no.8. 16. In rejoinder, Mr. Pangam, learned Counsel for the petitioners submitted that the judgment in the case of Pramod Raikar (supra) cannot be said to have laid down the proposition that in case of conflict between the provisions of the Act and the Byelaws, the Byelaws would prevail inasmuch as such a proposition is opposed to settled law. Mr. Pangam further submitted that in the case of Pramod Raikar(supra), the point as to whether the byelaw was in conflict with the provisions in the Act or that the provisions in the Act would prevail over the Byelaws, was not argued and as such, the decision in the case of Pramod Raikar (supra) cannot be construed as laying down any law contrary to one in the case of Jayprakash Salunke (supra). According to learned Counsel, the issues raised in the present petition are squarely covered by the decision of this Court in the case of Jayprakash Salunke (supra). Mr. Pangam placed reliance upon judgments of the Apex Court in the cases of Union of India and others Vs. Dhanwanti Devi and others; (1996) 6 SCC 44 and Punjab Land Development and Reclamation Corporation Ltd., Chan Vs. Presiding Officer, Labour Court, Chandigarh etc., 1990 (3)SCC 682 . 17. In the light of the rival submissions, the following points arise for determination in this petition:- 1. Whether quorum in terms of byelaw No. 35 was required for motion of no confidence called under Section 59A of the Act? 2. Whether respondent no.1 was legally justified in holding that there was no quorum at the meeting held and declaring that the motion of no confidence against respondents nos.3 and 4 was rejected for want of quorum of the meeting? 18. Before considering the rival submissions, it would be appropriate to quote Section 59A of the Act and Byelaw 35 of the Bank. They read thus:- “[ 59 A. Motion of no confidence against officers of societies. 18. Before considering the rival submissions, it would be appropriate to quote Section 59A of the Act and Byelaw 35 of the Bank. They read thus:- “[ 59 A. Motion of no confidence against officers of societies. (1) A President, Vice-President, Chairman and Vice- Chairman, Secretary, treasurer or Director or any other officer, by whatever designation called, who holds office by virtue of his election to that office shall cease to be such President, Vice- President, Chairman, Vice-Chairman, Secretary, Treasurer or director or any other officer, as the case may be, if a motion of no confidence is passed at a special meeting of the board of directors/committee of management of society by a simple majority of the total number of the members of board of directors/committee who are for the time being entitled to attend and vote at any meeting of the board of directors/committee and the office of such President, Vice-President, Chairman, Vice Chairman, Secretary, Treasurer or director or any other officer as the case may be shall thereupon be deemed to be vacant. (2) The requisition for convening special meeting of the board of directors/committee for considering such motion of no confidence shall be signed by not less than one-third of the total number of members of the board of directors/committee who are for the time being entitled to attend and vote at any meeting of the board of director/committee and shall be delivered to the Registrar: Provided that no such requisition for a special meeting shall be made within a period of six months from the date on which any person/officer referred to in sub-Section (1) has entered upon his office. (3) The Registrar shall, within seven days from the date of receipt of requisition under sub-Section (2), convene a special meeting of the board of directors/committee which shall be held not later than fifteen days from the date of issue of the notice of such meeting. (4) The special meeting called under sub-Section (3) shall be presided over by the Registrar or any person authorized by him in this behalf. The Registrar or such person shall, in when presiding over the meeting of the board of directors/committee, have the same powers as the President or Chairman when presiding over a board of directors'/committee's meeting has, but shall not have the right to vote. The Registrar or such person shall, in when presiding over the meeting of the board of directors/committee, have the same powers as the President or Chairman when presiding over a board of directors'/committee's meeting has, but shall not have the right to vote. (5) The meeting called under this Section shall not be adjourned for any reason. (6) Voting at the meeting shall be by raising of hands. The names of the directors/members of the committee voting for, and against the motion, shall be read in the meeting and recorded in the minute book of the special meeting of the board of directors/committee. Provided that if one-third of the directors/members of the committee present so demand, the voting shall be by secret ballot. (7) If the motion of no confidence is rejected, no fresh motion of no confidence shall be brought before the board of directors/committee within a period of six months from the date on which the motion is rejected. ]” “Byelaw 35:- QUORUM AT THE MEETING OF BOARD OF DIRECTORS. Half the number of the total strength of the Board of Directors shall form a quorum provided one of the Directors representing the Depositors, is present for the meeting and in the absence of both the Directors representing the depositors. The quorum for transaction of any business by the Board of Directors shall be the half number of the total strength of the Board of Directors plus one. NOTE If half the number of the total number of Directors is a fraction figure, it shall be rounded to the nearest figure on upper side, and such rounded figure shall constitute a quorum.” On perusal of Section 59 A, it is clear that a motion of no confidence against a President, Vice-President, Chairman, Vice Chairman of the Bank has to be passed by a simple majority of the total number of members of the Board of Directors/ committee, who are, for the time being, entitled to attend and vote at any meeting of the Board of Directors and if such a motion is passed, the concerned office of such officer shall be deemed to be vacant. Subsection (5) provides that the meeting called under Section 59A shall not be adjourned for any reason. Subsection (5) provides that the meeting called under Section 59A shall not be adjourned for any reason. Subsection (7) provides that if the motion of no confidence is rejected, no fresh motion of no confidence shall be brought before the Board of directors/committee within a period of six months from the date on which the motion is rejected. In the present case, the term of Board of Directors of the Bank expires in January, 2012. 19. The main question which arises for consideration is whether the quorum in terms of Byelaw 35 is required for a meeting called under Section 59A of the Act? 20. In the case of Jayprakash Salunke (supra), upon which reliance has been placed by Mr. Pangam, the Division Bench of this Court was dealing with a situation where no confidence motion was moved against the Chairman of the Trimurti Stalk Ply Sahakari Sanstha Limited, Basmat under the provisions of Maharashtra Co-operative Societies Act, 1960. In terms of Section 73-ID of the Act, a motion of no confidence had to be passed at a meeting of the committee by a simple majority of the total number of the managing committee members (entitled to vote at the election of such President, Vice-President, Chairman, Vice-Chairman, Secretary, Treasurer or director or any other officer). The requisition for such meeting had to be signed by not less than one third of the total number of members of the Committee. Subsection (5) also provided that a meeting called under the Section shall not be adjourned for any reasons and subsection (7) provided that no fresh motion of confidence shall be brought before the committee within a period of six months from the date of rejection of such motion. Rule 57-A(iii) framed under the Act provided that two-third members had to remain present at the meeting. Originally Section 73-1D(1) provided for two-third majority, which was subsequently amended by the words “simple majority” by an amendment by Maharashtra 7 of 1997. 21. The issue before the Division Bench was whether there was conflict between the provisions of Section 73-1D of the Act and the Rules, more particularly Rule 57A(7)(g)(iii) of the Rules. The Division Bench held that there was a conflict between Section 73-1D of the Act and Rule 57A(7)(g)(iii) of the Rules and the conflict was a head on conflict. 21. The issue before the Division Bench was whether there was conflict between the provisions of Section 73-1D of the Act and the Rules, more particularly Rule 57A(7)(g)(iii) of the Rules. The Division Bench held that there was a conflict between Section 73-1D of the Act and Rule 57A(7)(g)(iii) of the Rules and the conflict was a head on conflict. The Division Bench further held that in case of a conflict between the provisions of the Act and the Rules framed there under, the provisions of the statute must prevail if the Act and Rules are not reconcilable. After placing reliance upon the Judgments of Full Bench and Division Bench of this Court, the Division Bench expressly rejected the argument advanced on behalf of the respondents that the two provisions operate in different areas and there was no conflict between the provisions of Section 73-1D(1) of the Act and Rule 57-A(7)(g)(iii) of the Rules. The Division Bench held that Rule 57-A(7)(g)(iii) of the Rules only prescribed the conditions of quorum for holding the meeting and passing of such motion of no confidence is governed by the provisions of Section 73-1D(1) of the Act. Dealing with the arguments advanced on behalf of the respondents that quorum in terms of Rule 57-A was required for such a meeting, the Division Bench held that if such an interpretation was accepted, in case of a managing committee whose members were 15, the quorum would be 10 members and the simple majority will be 8 members; and even if 8 members had decided or they proposed to vote in favour of the motion, they could not express their democratic right of voting, because the meeting would be aborted on the ground that 10 members were not present and this was the conflict between the provisions of Rule 57A(7)(g)(iii) and Section 73-1D(1) of the Act. The Division Bench further held that the provisions of Section 73-1D(1) of the Act must prevail over the provisions of Rule 57A(7)(g) (iii) of the Rules and, as such, the meeting which was convened ought to have been proceeded with. In that case, two third members as required in terms of Rule 57A(7)(g)(iii) were not present, but there was a simple majority. In that case, two third members as required in terms of Rule 57A(7)(g)(iii) were not present, but there was a simple majority. In the present case, Section 59A mandates that a motion of no confidence would be passed by a simple majority of the total number of members of the Board of Directors, who are entitled to attend and vote. In the present case, for a motion of no confidence only 9 Directors are entitled to vote and as such, 5 number of Directors constitutes simple majority. In our considered opinion, the expression “number of members of the board of directors/committee who are for the time being entitled to attend and vote” must be construed as members who are entitled to attend for the purpose of voting at a meeting convened for consideration of no confidence motion against the Chairman or Vice-Chairman, etc. In our considered opinion, the words “entitled to attend and vote” must be construed conjointly and, therefore, for the purpose of Section 59A, in the present case 5 members would constitute simple majority. In our view, the ratio laid down in the case of Jayprakash Salunke (supra) is squarely applicable in the present case, inasmuch as if it is held that quorum for such a meeting is 6 as had been held by respondent no.1, the motion of no confidence moved by the petitioners who are 5 in number and in majority, would be defeated and would permit respondents no.3 and 4 who are in minority to continue to be Chairman and the Vice-Chairman of the Bank, although they do not have support of the majority. Moreover, subsection (5) provided that the meeting called for consideration of the no confidence motion shall not be adjourned for any reason. If the interpretation sought to be put by the respondents is accepted, then the net result would be that for want of quorum, the motion of no confidence which is not even discussed stands rejected and in view of the bar under subsection (7) even if the required number of directors decide to move no confidence motion against the Chairman and Vice-Chairman, they would not be able to bring such a motion in view of the clear bar under subsection (7) of Section 59A of the Act. Obviously, this could not be the intention of the legislature. Obviously, this could not be the intention of the legislature. The Bank, being an institution, has to run on democratic principles and ordinarily it is the majority which has to rule. 22. It is also well settled that if a rule or a byelaw is in conflict with the Act, the rule or the byelaw has to yield to the statutory provisions and the statutory provisions shall prevail over any rule or byelaw which is inconsistent with the provisions of the Act. In the present case, therefore, for a meeting held under Section 59A, quorum in terms of Byelaw 35 cannot be insisted upon. In terms of Byelaw 35 the quorum would be six, since there was admittedly no Director representing the depositors. Thus, there is apparent conflict between Section 59A(1) and Byelaw 35. In view of the settled law, therefore, Section 59A prevails over Byelaw 35 of the Bank and as such, quorum in terms of Byelaw 35 is not required. 23. Insofar as the authority in the case of Pramod Raikar (supra), upon which heavy reliance is placed by the learned Senior Counsel and the learned Advocate General appearing on behalf of the respective respondents is concerned, we find that in view of the ratio laid down by the Division Bench of this Court in the case of Jayprakash Salunke (supra) in which the facts are almost identical, there is no apparent conflict between the judgments in the case of Pramod Raikar (supra) and Jayprakash Salunke. Firstly, in the case of Pramod Raikar (supra), reliance was placed upon the judgment in the case of Jayprakash Salunke on behalf of the petitioners. If the Division Bench was inclined not to accept the ratio laid down in the case of Jayprakash Salunke, the only option that was available to the Division Bench was to disagree and refer the issue to the Larger Bench, as has been held by the Apex Court. It cannot be said that the Division Bench took a view contrary to the view taken by Jayprakash Salunke in the case of Pramod Raikar (supra). Moreover, in the said case, the Division Bench held that in terms of Section 73-1D(1) the motion of no confidence had to be passed by a simple majority of the total number of committee members who are time being entitled to attend and vote. Moreover, in the said case, the Division Bench held that in terms of Section 73-1D(1) the motion of no confidence had to be passed by a simple majority of the total number of committee members who are time being entitled to attend and vote. In that case, the total strength of the elected Members was 15, and as 9 elected members were present, the Division Bench held that the members constituted a simple majority and as such, the motion of no confidence passed could not be termed as illegal. However, the Division Bench further found that the notice to all the members who were entitled to vote were not given, the Division Bench held that the resolution passed was illegal, null and void. Incidentally, the Division Bench also considered the issue of quorum and held that there was no quorum for the meeting. It is pertinent to note that the Division Bench did not refer to the facts in the case of Jayprakash Salunke (supra) upon which reliance was placed by the learned Counsel for the petitioners nor disagreed with the view taken in the said judgment. Mr. Pangam is justified in placing reliance upon the Judgment in the case of Union of India and others vs. Dhanwanti Devi and others; (1996) 6 SCC 44 in which the Apex Court, after placing reliance upon several Judgments, considered what is ratio decidendi. In para 9, the Apex Court held thus: “Before adverting to and considering whither solatium and interest would be payable under the Act, at the outset, we will dispose of the objection raised by Shri Vaidyanathan that Hari Kishan Khosla's case is not a binding precedent nor does it operate as ratio decidendi to be followed as a precedent and per se per incuriam. It is not everything said by a Judge who giving judgment that constitutes a precedent. The only thing in a Judge's decision binding a party is the principle upon which the case is decided and for this reason it is important to analyse a decision and isolate from it the ratio decidendi. It is not everything said by a Judge who giving judgment that constitutes a precedent. The only thing in a Judge's decision binding a party is the principle upon which the case is decided and for this reason it is important to analyse a decision and isolate from it the ratio decidendi. According to the well settled theory of precedents, every decision contain three basic postulates – [i]findings of material facts, is the inference which the Judge draws from the direct, or perceptible facts; [ii] statements of the principles of law applicable to the legal problems disclosed by the facts; and [iii] judgment based on the combined effect of the above. A decision is only an authority for what it actually decides. What is of the essence in decision is its ratio and not every observation found therein not what logically follows from the various observations made in the judgment. Every judgment must be read as applicable to the particular facts proved, since the generality of the expressions which may be found there is not intended to be exposition of the whole law, but governed and qualified by the particular facts of the case in which such expressions are to be found. It would, therefore, be not profitable to extract a sentence here and there from the judgment and to build upon it because the essence of the decision is its ratio and not every observation found therein. The enunciation of the reason or principle on which a question before a court has been decided is alone binding between the parties to it, but it, is the abstract ratio decided, ascertained on a consideration of the judgment in relation to the subject matter of the decision, which alone has the force of law and which, when it is clear what it was, is binding. It is only the principle laid down in the judgment that is binding law under Article 141 of the Constitution. A deliberate judicial decision arrived at after hearing an argument on a question which arises in the case or is put in issue may constitute a precedent, no matter for what reason, and the precedent by long recognition may mature into rule of stare daisies. It is the rule deductible from the application of law to be facts and circumstances of the case which constitutes its ratio decidendi.” 24. It is the rule deductible from the application of law to be facts and circumstances of the case which constitutes its ratio decidendi.” 24. In the case of Punjab Land Development and Reclamation Corporation Ltd., Chan Vs. Presiding Officer, Labour Court, Chandigarh etc; 1990 (3) SCC 682 , the Apex Court held that to consider the ratio decidendi of a case, we have to ascertain the principle on which the case was decided. Reference was made to Sir George Jessel in Osborne Vs. Rowlatt, with the following remark: “The only thing in a Judge's decision binding as an authority upon a subsequent Judge is the principle upon which the case was decided.” 25. Having regard to the above referred judgments, it is difficult for us to hold that in the case of Pramod Raikar (supra), the Division Bench has held that in case of a conflict between the Act and the Byelaws, the Byelaws must prevail. 26. In view of the above, we are unable to accept the submissions made by the learned Senior Counsel and the learned Advocate General in support of the stand taken by respondent no.1. In our considered opinion, there is no apparent conflict between the Judgments in the cases of Jayprakash Salunke and Pramod Raikar and, therefore, we do not deem it necessary to refer the issue to a Larger Bench. There can be no dispute that the Apex Court in the cases of State of Tripura (supra) and S.I. Rooplal and Another (supra) has held that a Division Bench of a High Court cannot take a view different than the view taken by an earlier Division Bench of the High Court and the only course available for the Bench is to refer the matter to a Larger Bench. In our opinion, the said ratio instead of advancing the case of the respondents, supports the case set up by the petitioners. In our opinion, the said ratio instead of advancing the case of the respondents, supports the case set up by the petitioners. In our opinion, since the facts in the case of Jayprakash Salunke (supra) were almost similar to the facts in the present case, except that in the case of Jayprakash Salunke the conflict was between the provisions of the Act and the Rules; whereas in the present case the conflict is between the provisions of the Act and the Byelaws, the Division Bench in the case of Pramod Raikar (supra) cannot be said to have laid down any proposition that in case of a conflict between the Act and the Rules or the Byelaws, the Rules or the Byelaws would prevail over the statutory provisions. It is also well settled that the provisions of the statute has to be interpreted keeping in view the intention of the legislature. In the present case, Section 59A of the Act provides that the motion of no confidence has to be passed by a simple majority of the total number of members of the Board of Director who are for the time being entitled to attend and vote at such meeting of the Board of Directors. We have already held that since there were 9 elected Directors and only they were entitled to vote at such meeting convened to consider the motion of no confidence, only a simple majority would be required and not 6 as held by respondent no.1. Though in terms of Byelaw 35 quorum for the meeting was 6, Section 59A(1) must prevail over Byelaw 35, since Byelaw 35 is inconsistent with the said provision. We find considerable merit in the submission of Mr. Pangam that in case the interpretation sought to be put on behalf of the respondents is accepted, the same would render Section 59A ineffective and inoperative. Therefore, respondent no.1 was not justified in rejecting motion of no confidence for want of quorum. 27. We shall now consider the authorities relied upon by Mr. Nadkarni in support of his submission that the quorum in terms of Byelaw 35 was required for the meeting convened under Section 59A of the Act to consider the motion of no confidence under Section 59A of the Act. In the case of Zoroastrian Co-op. Housing Society (supra), relied upon by Mr. Nadkarni in support of his submission that the quorum in terms of Byelaw 35 was required for the meeting convened under Section 59A of the Act to consider the motion of no confidence under Section 59A of the Act. In the case of Zoroastrian Co-op. Housing Society (supra), relied upon by Mr. Nadkarni, the Apex Court held that the concept of public policy in the context of the Cooperative Societies Act has to be looked into within the four corners of that Act and in the absence of any prohibition contained therein against the forming of a society for persons of Parsi origin, it could not be held that the confining of membership as was done by Byelaw No.7, was opposed to public policy. In the said case, in terms of Byelaw No.7, the membership of the society was restricted to only Parsi. In this background, the Apex Court held that membership in a co-operative society only brings about a contractual relationship among the members forming it subject, of course, to the Act and the Rules. The Apex Court held that the Byelaws do not have the status of a statute and as held by the Apex Court in Co-operative Central Bank Ltd. Vs. Additional Industrial Tribunal, byelaws are only the rules which govern internal management or administration of a society and they are of the nature of Articles of Association of a Company incorporated under the Companies Act and they may be binding between the persons affected by them but they do not have the force of a statute. The Apex Court further held that Byelaw No.7 could not be ignored by a member nor by the Court on the ground that it was opposed to public policy. In our considered opinion, the judgment in the case of Zoroastrian Co-op. Housing Society (supra) does not advance the case of the respondents inasmuch as the factual matrix and the question of law involved were entirely different. We also do not find merit in the submission of Mr. Nadkarni that in the absence of any challenge to Byelaw No.35 of the Bank, the petitioners are not entitled to any relief. The petitioners, in law, are entitled to contend that there is head on conflict between the Act and Byelaw and the provisions of the Act shall prevail over the Byelaw. 28. Nadkarni that in the absence of any challenge to Byelaw No.35 of the Bank, the petitioners are not entitled to any relief. The petitioners, in law, are entitled to contend that there is head on conflict between the Act and Byelaw and the provisions of the Act shall prevail over the Byelaw. 28. Having already held that Section 59A(1) would prevail over Byelaw No.35, we do not deem it necessary to deal threadbare with the other Judgments relied upon by Mr. Nadkarni which are in relation to the meetings and quorum. In none of these judgments, it has been held that in case of conflict between the Act and the Byelaws, the Byelaws have to be followed. We are, therefore, of the considered opinion that the view taken by respondent no.1, as expressed in the Minutes dated 7/7/2011, is patently unsustainable in law. 29. For the reasons aforesaid, the petition is liable to be allowed. Respondent nos.1 and 2 shall convene a fresh special meeting after complying with the necessary procedure. The meeting shall be called and motion of no confidence shall be considered within a period of three weeks from today. Rule is made absolute in terms of prayer clauses (a) and (b). There shall be no order as to costs.