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2016 DIGILAW 808 (KAR)

H. M. Manjunathappa v. Joint Registrar of Co-operative Societies, Bangalore Division

2016-11-02

S.ABDUL NAZEER

body2016
ORDER : S. Abdul Nazeer, J. 1. In this case, petitioner has called in question the legality and correctness of the order at Annexure 'G' dated 10.3.2016 whereby the first respondent has allowed the application of the 5th respondent for his impleadment as an additional respondent. 2. The petitioner is the President of the 4th respondent-Society. The 5th respondent was the nominated Director of the said Society during the relevant point of time and he continues to be a member of the Society. On the basis of a complaint of the 5th respondent, the second respondent passed an Order dated 1.4.2015 for holding inspection of the accounts of the Society under Section 65 of the Karnataka Co-operative Societies Act, 1957 ('Act' for short) and appointed the third respondent as an enquiry officer. The third respondent held an enquiry and submitted the report to the second respondent. On the basis of the said report, the second respondent passed an Order dated 28.7.2015 under Section 68 of the Act directing the Society to initiate disqualification proceedings against the petitioner under Section 29-C of the Act. The petitioner has challenged the said order by filing an appeal before the first respondent. In the said case, 5th respondent made an application for his impleadment. As noticed above, the said application has been allowed by the first respondent. 3. Sri Jayakumar S. Patil, Learned Senior Counsel appearing for the petitioner submits that the 5th respondent has no locus standi to come on record as the respondent. It is submitted that the 5th respondent is neither a necessary nor a proper party. There is no lis between the 5th respondent and the petitioner and the petitioner is not an aggrieved party. Learned Senior Counsel has relied on the following decisions in support of his contentions: (i) KEDAR SHASHIKANT DESHPANDE AND OTHERS vs. BHOR MUNICIPAL COUNCIL AND OTHERS (2011) 2 SCC 654 ; (ii) RAVI YASHWANT BHOIR vs. DISTRICT COLLECTOR, RAIGAD AND OTHERS (2012) 4 SCC 407 , (iii) PARAPPA vs. NANDARAYAPPA AND OTHERS 1998 (6) KLJ 557-; and (iv) S. SRINIVAS AND OTHERS vs. THE STATE OF KARNATAKA AND OTHERS W.P. Nos. 54844 to 54849/2013 disposed of on 4.3.2014. 4. On the other hand, Learned Counsel appearing for the 5th respondent submits that 5th respondent was the nominated Director during the relevant point of time. 54844 to 54849/2013 disposed of on 4.3.2014. 4. On the other hand, Learned Counsel appearing for the 5th respondent submits that 5th respondent was the nominated Director during the relevant point of time. On the basis of his complaint, the second respondent has initiated suo motu proceedings under Section 65 of the Act. On the basis of the report, an order was passed on 28.7.2015 under Section 68 of the Act. The petitioner filed an appeal challenging the said order. In the said case, interim order was granted by the first respondent. The 5th respondent was impleaded on 10.8.2016 and the stay was vacated on 18.8.2016. Petitioner challenged the said Order dated 18.8.2016 by filing writ petitions in W.P. Nos. 46050/2016 and 46373/2016. This Court by Order dated 30.8.2016 directed disposal of the main matter within one month from the date of receipt of copy of the said order. The interim order was continued till the disposal of the appeal. Thereafter, petitioner has challenged the impleadment of the 5th respondent. The 5th respondent being the nominated Director of the Society is an aggrieved party and he is a necessary party to the proceedings. 5. Having heard the Learned Counsel for the parties, the question for consideration is whether the 5th respondent has locus standi to oppose the claim of the petitioner or whether he is an aggrieved party and his application for impleadment needs to be allowed? 6. It is settled that a person who has been prejudicially affected by an act or omission of an authority has right to challenge the same before the competent Court. The orthodox rule of interpretation regarding the locus standi of a person to reach the Court has undergone a sea change with the development of Constitutional law in India and the Constitutional Courts have been adopting a liberal approach in dealing with the cases or dislodging the claim of a litigant merely on hyper-technical grounds. If a person approaching the Court can satisfy that the impugned action is likely to adversely affect him, the petition filed by such a person cannot be rejected on the ground of his not having the locus standi. In other words, if the person is found to be not merely a stranger to the case, he cannot be non-suited on the ground of his not having locus standi. 7. In other words, if the person is found to be not merely a stranger to the case, he cannot be non-suited on the ground of his not having locus standi. 7. The meaning of the words 'a person aggrieved' may vary according to the context of the statute. One of the meanings is that a person will be held to be aggrieved by a decision if that decision is materially adverse to him. 8. It is settled that the object of the Co-operative Society is to promote economic interest of its members by following Co-operative principles where the profit motive will be restricted to a reasonable level unlike other commercial bodies (See M/s. S.M. MAHENDRU AND COMPANY vs. STATE OF TAMIL NADU, AIR 1985 SC 270 ). 9. In the instant case, on the basis of the complaint of the petitioner, the second respondent has initiated proceedings exercising suo motu power, which is permissible in law. A report was submitted under Section 65 on the basis of which an order was passed under Section 68. This order was challenged before the first respondent. The findings of the second respondent is that the petitioner has caused loss to the Co-operative Society. In the appeal, the petitioner did not array the 5th respondent as a party and an interim order was obtained in the appeal. Thereafter, 5th respondent got himself impleaded and the interim order was vacated. Petitioner did not challenge the order directing impleadment of the 5th respondent at the first instance. He challenged the subsequent order vacating the interim stay before this Court and this Court directed continuation of the interim order and disposal of the appeal within a time frame. It is only thereafter petitioner has filed this writ petition challenging the impleadment of the 5th respondent. 10. In my view, the 5th respondent has locus standi to contest the matter before the first respondent. He was the nominated Director when he lodged the complaint to the second respondent and on the basis of his complaint, the proceedings were initiated resulting in submission of the report under Section 65. He continues to be the member of the Society. He has right to protect the economic interest of the Society as he is the member of the Society. In my opinion, the 5th respondent is a necessary party. 11. He continues to be the member of the Society. He has right to protect the economic interest of the Society as he is the member of the Society. In my opinion, the 5th respondent is a necessary party. 11. In RAVI YASHWANT BHOIR (supra), the applicant was an Ex-President of the Society. Therefore, the Hon'ble Supreme Court held that he cannot claim the status of an adversarial litigant. 12. In PARAPPA (supra), an election petition was filed by a defeated candidate before the Jurisdictional Munsiff, Jamkhandi. The appellant in the said case claiming to be an agriculturist and a voter, filed an application before the Director seeking disqualification of the first respondent. The Division Bench held that no individual person has statutory right to invoke the jurisdiction of the Director though if complaint is made by any individual person making allegation regarding disqualification of a particular member. The Director can consider such complaint as an information only for the purpose of invoking his suo motu jurisdiction. The Court held that for that reason, the complainant cannot claim right either to defend or to support any proceeding initiated by the Director. This decision has no application because the 5th respondent in the present case was the nominated Director of the Society at the relevant point of time and he continues to be a member of the Society. 13. Even in the case of S. SRINIVAS (supra), the petitioners are not the members of the Society. They are private parties. Therefore, this Court rejected their application for impleadment. 14. There is no merit in this writ petition. It is accordingly dismissed. No costs.