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2012 DIGILAW 627 (KER)

Vadakkekad Service Co-Operative Bank Limited v. Joint Registrar Of Co-Operative Societies (General), Thrissur

2012-07-05

S.SIRI JAGAN

body2012
JUDGMENT 1. The petitioner is a Co-operative Bank registered under the Kerala Co-operative Societies Act. By a resolution adopted by the general body of the Society, the Society decided to increase its share value by amending its bye-laws. The amendments were registered by the Joint Registrar. Thereafter the petitioner published notices in the notice boards of the Society, Panchayat and Village Office and two vernacular dailies, directing the members to remit the difference in the share value on account of the resolution to increase the share value. Nobody has raised any complaint in respect of the same. But the Joint Registrar has now issued Ext.P5 order directing that the amendment of the bye law will come in to force only after the petitioner complies with the procedure prescribed in Section 11(2) of the Co-operative Societies Act. The petitioner has filed this writ petition challenging Ext.P3. The contention of the petitioner is that Section 11(2) is not applicable to enhancement of share value. It is applicable only when the Society passes a resolution to change the form or extent of its liability. Therefore Ext.P5 is clearly against the provisions for the Kerala Co-operative Societies Act is the contention raised. The petitioner also relies on the decisions of this Court in Balakrishnan and Another v. Returning Officer and Others (1993 (1) KLJ 280) and Rajan v. Electoral Officer (2009 (3) KLT 1046) which hold that individual notices as contemplated under Section 11(2) cannot have application when Society enhances its share value. 2. I have heard the learned Government Pleader also. 3. Section 11(2) reads thus: "(2) When a Society has passed a resolution to change the form or extent of its liability it shall give thereof in writing to all its members and creditors and notwithstanding the provisions of Section 24 or any bye-laws or contract to the contrary, any member or creditor shall, during a period of 2 months from the date of service of notice upon him, have the option of withdrawing his shares, deposits of loans, as the case may be." There cannot be any doubt that Section 11(2) applies only when Society passes a resolution to change the form or extent of its liability. Enhancement of share value does not in any way result in changing of form or extent of the liability of the Society. Enhancement of share value does not in any way result in changing of form or extent of the liability of the Society. The two decisions of this Court also hold that Section 11(2) is not applicable to cases were Society enhances its share value. Therefore following those decisions this writ petition is allowed. Ext.P5 order is quashed. It is declared that Section 11(2) is not applicable to the resolution of the Society for enhancing its share value.