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Himachal Pradesh High Court · body

2015 DIGILAW 918 (HP)

Vinod Thakur v. State of H. P

2015-07-21

SURESHWAR THAKUR

body2015
Judgment : Sureshwar Thakur, J (oral) Both these petitions pertain to a common subject matter, hence can be disposed of by a common order. 2. In both petitions the petitioners are un-controvertedly members of respondent No.3. They aspired to seek election to the office of Board of Directors in the respondent No.3-Bank. For fructifying their endeavor, they filed nomination papers before the Returning Officer (respondent No.4). The respondent No.4 rejected their nominations/candidatures constituted by her omission to display, in the final list of the contesting candidates for election of Board of Directors of respondent No.3/Bank, comprised in Annexure P-8, the names of the petitioners herein. Hence, they preferred an appeal before the Additional Registrar (Admn), Cooperative Societies, H.P. The latter on being seized of the appeal as preferred before him against Annexure P-8 affirmed the orders comprised in Annexure P-8. In consequence thereto the petitioners were debarred from contesting election for the Board of Directors of respondent No.3- Bank. Hence, the present petitions. 3. The stumbling block to the aspiration of the petitioners to contest elections of Board of Directors of respondent No.3-Bank, is constituted in the fact of the petitioners herein having not satiated the parameters enshrined in amended bye-law No. 31 comprised in Annexure P-4, in as much as theirs in compliance thereto having not maintained for a continuous period of two years with respondent No. 3, a credit balance of not less than Rs. 5000/-. 4. The learned counsel for the petitioners has with much sinew and vigor contended before this Court that the criterion as referred to hereinabove comprised in amended bye-law No. 31 as stands extracted hereinafter, is in derogation besides in conflict with clause 2 of Appendix A of the H.P Cooperative Societies Rules. In sequel he has contended that its invocation at the instance of the respondent for debarring the petitioners to contest elections of Board of Directors of respondent No.3/Bank, is flawed besides unwarranted. “Amended bye-law No. 31 Eligibility for election as Director:- A shareholder member shall not be eligible to be elected as director unless he is a shareholder member of the Bank for at least two continuous year prior to the date of election and should have maintained a deposit account with that Bank for a continuous period of 2 years with a credit balance of not less than Rs. 5000/-.” 5. 5000/-.” 5. For determining the tenacity of his arguments it is deemed apt to also extract hereinafter the aforesaid clause 2 of Appendix A of the H.P Cooperative Societies Rules. 2. Qualification of candidates- No person shall be eligible for election as a member of the committee if he is subject to any disqualification mentioned in Rule 41. 6. A reading of clause 2 palpably voices the fact that it mandates, the disqualifications with which a person aspiring to contest elections of Board of Directors of respondent No.3-Bank ought not to be gripped with. The apposite disqualifications stand voiced in Rule 41 of the Himachal Pradesh Cooperative Societies Rules. However, the learned counsel for the petitioners has contended that since the disqualifications mandated in Rule 41 of the Himachal Pradesh Cooperative Societies Rules do not bespeak of any necessity for a member aspiring to contest elections of Board of Directors of respondent No.3-Bank, maintaining with it for a continuous period of two years a credit balance of not less than Rs.5000/-. Consequently, he contends that the amended bye-law No. 31 casting an obligation aforesaid or mandating an obligation as bespoken therein is in conflict with Rule 41 of the H.P Cooperative Societies Rules, which stands extracted hereinafter. “41. Consequently, he contends that the amended bye-law No. 31 casting an obligation aforesaid or mandating an obligation as bespoken therein is in conflict with Rule 41 of the H.P Cooperative Societies Rules, which stands extracted hereinafter. “41. Disqualification for membership of committee-(1) No person shall be eligible for appointment, or election as member of the committee of any society, if he:- (a) is an applicant to be adjudicated a bankrupt or is an insolvent or an uncertificated bankrupt or an undischarged insolvent; or (b) has been sentenced for any offence other than an offence of a political character or an offence not involving moral delinquency, such sentence not having been reserved or the offence pardoned; or (c) is of unsound mind; or (d) a paid employee of the society or of any other Co-operative Society ; or (e) is in the same line of business as conducted by the society ; provided that if any question arises whether a person is or is not in the same line of business, the question shall be referred to the Registrar and his decision shall be final; or (f) is concerned with the profits of any contract entered with the society except in transactions made with the society as a member in accordance with the objects of the society as stated in the bye-laws, provided that if any question arises whether a person is or is not so concerned with the profits of any contract the question shall be referred to the Registrar and his decision shall be final; or (g) is, except with the sanction of the Registrar, already the member of the committee of any other society of the same type; or (h) has been sued in arbitration in a society, and award given against him stands unsatisfied wholly or partially ; or 1* (i) is a near relation of paid employee of the society, provided that if any question arises whether a person “ has associated himself with the appointment of a near relation in the services of the society concerned,” the question shall be referred to the Registrar and his decision shall be final; or 2* (ii) “the society, of which he is a representative becomes defaulter; or” (j) is a defaulter of any society; or 3* (jj) “is a representative of a defaulter society; or” (k) has been debarred from becoming an officer of any society under Rule 58; or (l) is under 21 years of age. (2) A member of the committee of any society shall cease to hold office as such if he:- (a) applies to be adjudicated, or is adjudicated a bankrupt or an insolvent ; or. (b) Is sentenced for any such offence as is described in clause (b) of sub-rule (1) ; or (c) Becomes of unsound mind; or (d) Becomes a paid employee of the society or any other society; or (e) Enters on the same line of business as conducted by the society; or (f) Becomes concerned with profits of any contract entered into by the society except transactions made with society as a member, in accordance with the objects of the society as stated in the bye-laws; or (g) Becomes a member of the committee of any other society of the same type, except with the sanction in writing of the Registrar; or (h) Becomes a near relation of the paid employee of the society; or (i) Becomes a defaulter of any debt or dues directly, or indirectly of his society or of any other society; or (j) Is debarred from becoming an officer of any society under Rule 58; or (k) Ceases to be a member of the society; or (l) Is found to be under 21 years of age.” 7. However, the aforesaid contention is shorn off its sheen and vigor especially when as adverted to hereinabove clause 2 of Appendix A, as stands extracted hereinabove merely voices the apposite prohibitions which further stand communicated in Rule 41 of the Himachal Pradesh Cooperative Societies Rules and whose inherence in a member trammels or fetters his right to contest elections of Board of Directors of respondent No.3-Bank. The prohibitions exhaustively or ad-nauseam enunciated therein are obviously a mere enumeration of disqualifications which ought not to be besetting or gripping or inhering in any member aspiring to contest elections of Board of Directors of respondent No.3-Bank, yet there is no exhaustive articulation in either the H.P Cooperative Societies Act or the Rules framed thereunder of the qualifications which are necessarily enjoined to be possessed by a member aspiring to contest elections to the office of Director of respondent No.3-Bank, as a natural corollary then, given the reticence in the Act aforesaid and the Rules framed thereunder qua the qualifications which empower a member to contest elections to the office of Board of Directors of respondent No.3-Bank, necessarily then, enough room was left for the respondent No.3-Bank a duly constituted society under the Cooperative Societies Act, to on the anvil of Section 11 proceed to incorporate an amendment in the bye-laws of respondent No.3 with a prescription therein of the apposite qualifications, peremptorily to be possessed by a member aspiring to contest elections of the Board of Directors of respondent No.3-Bank. In sequel, the prescription in amended bye-law No. 31 qua a member aspiring to contest elections to the office of Board of Directors of respondent No.3-Bank being necessarily possessed with a credit balance therein of not less than five thousand for a continuous period of two years is a tenable prescription. In sequel, the prescription in amended bye-law No. 31 qua a member aspiring to contest elections to the office of Board of Directors of respondent No.3-Bank being necessarily possessed with a credit balance therein of not less than five thousand for a continuous period of two years is a tenable prescription. Moreso, for reiteration when Rule 41 omits to prescribe or enunciate the qualifications with which a member aspiring to contest elections of Board of Directors of respondent No.3-Bank, is to be empowered with rather when it merely bespeaks of prohibitions or disqualifications which preclude a member from contesting elections to the office of Board of Directors of respondent No.3-Bank, now when the amended by-law No. 31 merely fills in the aforesaid gaping hole and hiatus left in the Act aforesaid and the Rules framed thereunder, as such, when then it hence amplifies the necessity of compliance, by an member aspiring to contest elections to the office of Board of Directors of respondent No.3- Bank, with a holistic criterion besides when, the prescription enjoined therein to be possessed by a member is neither out side the ambit nor beyond the purview of the spirit of the H.P Cooperative Societies Act or Rules framed thereunder, rather when the provisions of Section 11 of the H.P Cooperative Societies Act authorize respondent No.3 to frame bye-laws or carry out amendments in the bye-laws, it is to be firmly concluded that the amended bye-law No. 31,is hence within the domain of Section 11 or carries with it a statutory leverage. Moreover, an advertence to the provisions of Section 34 of H.P Cooperative Societies Act which stands extracted hereinafter contemplates an enshrined mandate of the management of a cooperative society vesting in the managing committee constituted in accordance with law and bye-laws. The import of the existence of the aforesaid phraseology in Section 34 of the Act aforesaid is that it bestows a statutory legal pedestal to the bye-laws which stand framed by respondent No.3 unless it is contended and substantiated which however has not been done by the learned counsel for the petitioner, that the bye-laws as have come into existence and stand nomenlatured as amended bye-law No. 31 are in dire transgression with the mandate of section 11. In aftermath it appears that there is no conflict inter-se the provisions of clause 2 of Appendix A of the H.P Cooperative Societies Rules besides rule 41 thereof and amended bye-law No.31 of respondent No.3-Bank with an incorporation therein of the aforesaid sine-qua-non with which a member is enjoined to be empowered with, to aspire to contest elections of the Board of Directors of respondent No.3-Bank nor it stands afflicted with any legal malady ensuing from the fact of its having come into existence in transgression of the mandate of Section 11 of the H.P Cooperative Societies Act which stands extracted hereinafter:- 34. Managing Committee:- The management of every society shall vest in a managing committee constituted in accordance with the rules and the bye-laws, which shall exercise such powers and perform such duties as may be conferred or imposed respectively, by this Act, the rules and the bye-laws “11. Amendment of bye-laws of a co-operative society:- (1) No amendment of any by-laws of a co-operative society shall be valid unless approved by the resolution of a general meeting and registered under this Act for which purpose three copies of the amendment shall be forwarded to the Registrar as prescribed. (2) If the Registrar is satisfied that the proposed amendment- (i) is not contrary to the provisions of this Act and the Rules. (ii) does not conflict with co-operative principles, (iii) will promote the economic or social interest of the members of the society, (iv) is not inconsistent with the principles of social justice, He may register the amendment. (3) When the Registrar registers an amendment, he shall forward to the society a copy of the registered amendment together with a certificate signed by him and such certificate shall be conclusive evidence that the amendment has been duly registered (4) Where the Registrar refuses to register an amendment of the bye-laws, of a co-operative society, thereof he shall communicate the order of refusal together with the reason to the society. (5) Any amendment which is not disposed of by the Registrar within 90 days of its receipt shall be deemed to have been registered under this Act and the provisions of Sub-Section (3) of this Section shall apply to such amendment. (5) Any amendment which is not disposed of by the Registrar within 90 days of its receipt shall be deemed to have been registered under this Act and the provisions of Sub-Section (3) of this Section shall apply to such amendment. (6) An amendment of the bye-laws of a cooperative society shall, unless it is expressed to come into operation on a particular day, come into force on the day on which it is registered.” 8. However when as such bye-law No. 31 of respondent No.3-Bank has come into existence in consonance with the mandate of Section 11 of the H.P Cooperative Societies Act, besides when there is no conflict of bye-law No. 31 for the reasons afore-stated with either clause 2 of Appendix A of H.P Cooperative Societies Rules or with its Rule 41, consequently this Court does not deem it fit and appropriate to interfere with the impugned orders. The result thereof is that the election held, to the office of its Board of Directors be declared forthwith and the participation of the petitioners in the election to the office of Board of Directors of Respondent No.3 would, in view of the aforesaid discussion, not taken into account. However in future if the petitioners attain the eligibility criteria, they shall be necessarily empowered to contest election for the Board of Directors of respondent No.3-Bank. In view of above, the present petitions are dismissed and the Annexures impugned before this Court are upheld. All pending applications stand disposed of accordingly.