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2019 DIGILAW 1574 (HP)

Kishori Lal Sharma v. State of H. P.

2019-10-23

TARLOK SINGH CHAUHAN

body2019
JUDGMENT : TARLOK SINGH CHAUHAN, J. 1. Since common questions of law and facts are involved in both these petitions, therefore, the same were taken up together for consideration and are being disposed of by a common judgment. 2. The only difference in both these petitions is that the petitioners in CWP No. 1200 of 2019 are the Members of The Talai, Gram Sewa Sabha Samiti, Talai i.e. respondent No. 4-Society, whereas the petitioner in CWP No. 1224 of 2019 is the former Secretary of respondent No. 4-Society. The prayers made in both these petitions are common and read as under: CWP No. 1200 of 2019: (i) That the notification issued by respondent No. 3 appointing a Nominated Committee in respondent No. 4-Society, dated 28.03.2019 (Annexure P-2) may be quashed and set-aside being illegal and arbitrary. (ii) That respondents No. 2 and 3 may be directed to appoint administrator in the respondent No. 4 Society as per provisions of Section 37 of the Act to run the day to day affairs of the Society. (iii) That respondents No. 2 to 3 be directed to restore the democratically elected Managing Committee of the Society in a time bound manner by conducting election of the Managing Committee of the respondent No. 4 Society as per provision of law. CWP No. 1224 of 2019 (i) That the order dated 28.3.2019 (Annexure P-1) removing the elected Managing Committee may be quashed and set-aside being illegal, without jurisdiction and arbitrary, further the elected Managing Committee of respondent No. 4 Society may be allowed to complete its normal tenure. (ii) That the notification issued by respondent No. 3 appointing a Nominated Committee in respect of respondent No. 4 Society dated 28.3.2019 (Annexure P-2) may be quashed and set-aside being illegal and arbitrary. (iii) That respondent No. 4 Society may be directed to place the suspension order of the petitioner on record and the same may be directed to be quashed and set-aside being illegal and without jurisdiction. (iv) That the respondent No. 2 may be directed to conduct re-audit for the year 2017-2018 of the respondent No. A-Society by associating the petitioner with the same. 3. The undisputed facts lie in a narrow compass. (iv) That the respondent No. 2 may be directed to conduct re-audit for the year 2017-2018 of the respondent No. A-Society by associating the petitioner with the same. 3. The undisputed facts lie in a narrow compass. The elected Managing Committee of respondent No. 4-Society had vide resolution No. 1313 dated 19.1.2019 resolved to request the respondent No. 3 to appoint Departmental Administrator in the Society to run its day to day affairs. However, respondent No. 3 without taking any cognizance of the above referred resolution of the Society, issued show cause notice dated 8.3.2019 and 13.3.2019 to the then Managing Committee. The reply was filed by the then Managing Committee jointly as well as individually and not being satisfied with the said replies, respondent No. 3 ordered the removal of the elected Managing Committee by invoking the provisions of Section 37(1)(a) of the H.P. Cooperative Societies Act, 1968 (for short Act) vide its order dated 28.3.2019. 4. On the very same day i.e. on 28.3.2019, respondent No. 3 vide notification constituted the Nominated Managing Committee of respondent No. 4-Society consisting of respondents No. 5 to 11 under Section 35-A of the Act which according to the petitioners is in gross violation of the law. 5. It is the contention of the petitioners that once the provisions of Section 37(1)(a) had been invoked, then respondent No. 3 without adhering to the other provisions of section could not have resorted to Section 35-A of the Act which empowers the Registrar to constitute new Committee only in a situation where a committee constituted in accordance with the provisions of the Act, rules and byelaws does not exist. Whereas, in the present case the elected Managing Committee of respondent No. 4-Society was in existence on 28.3.2019 and had been removed by respondent No. 3 by invoking provisions of Section 37(1)(a) of the Act. 6. The official-respondents have contested the petition by filing reply wherein it has been contended that respondent No. 3 after removing the Managing Committee of the respondent No. 4-Society by invoking provisions of Section 37(1)(a) of the Act, had three options with him i.e. either: (i) to order fresh election to the Committee as per provision contained in Section 37(1)(a)(i) of the Act. (ii) appoint one or more administrators to manage the affairs of the society as per provision contained in Section 37(1)(a)(ii) of the Act. (ii) appoint one or more administrators to manage the affairs of the society as per provision contained in Section 37(1)(a)(ii) of the Act. (iii) constitute a new committee to manage the affairs of the society as per provision contained in Section 35-A(1) of the Act. 7. Having invoked the provisions of Section 35-A(1) of the Act, no fault can be found with the action of respondent No. 3. In addition thereto, it has been averred that in view of the Auditors report pertaining to the Society for the financial year 2017-18 wherein large scale illegalities and irregularities had been detected in the Society, no fault can be found in the action of respondent No. 3. 8. The private respondents have not filed any separate reply and have adopted the reply filed by official respondents No. 1 to 3 as is evident from the order dated 9.9.2019, which reads as under: “Mr. Hamender Singh Chandel, learned counsel submits that no separate reply is intended to be filed on behalf of respondents No. 4 to 11 and reply to the writ petition filed on behalf of respondents No. 1 to 3, is adopted on their behalf. No rejoinder is intended to be filed.” 9. I have heard learned counsel for the parties and have gone through the records of the case carefully. 10. At the out-set, it needs to be pointed out that even though there are serious allegations regarding the mis-management, mis-appreciation and embezzlement of the funds of the Society by the Members of the society, but that is not the subject matter, therefore, this Court will not go into this question. 11. However, Mr. Hamender Singh Chandel, learned counsel for the private respondents would argue that since the petitioners have not availed an alternative efficacious remedy or rather the statutory remedy under Section 72 of the Act, therefore, the present petitions are not maintainable. 12. It is more than settled that existence of an alternate remedy, whether adequate or not, does not alter the fundamentally discretionary nature of the High Court's writ jurisdiction and therefore does not create an absolute legal bar on the exercise of the writ jurisdiction by a High Court. The decision whether or not to entertain an action under its writ jurisdiction remains a decision to be taken by the High Court on an examination of the facts and circumstances of a particular case. 13. The decision whether or not to entertain an action under its writ jurisdiction remains a decision to be taken by the High Court on an examination of the facts and circumstances of a particular case. 13. This was so held by the Hon'ble Supreme Court in a very recent judgment in Maharashtra Chess Association vs. Union of India, (2019) 3 Apex C.J. 166, wherein it was observed as under: “18. This argument of the second respondent is misconceived. The existence of an alternate remedy, whether adequate or not, does not alter the fundamentally discretionary nature of the High Court's writ jurisdiction and therefore does not create an absolute legal bar on the exercise of the writ jurisdiction by a High Court. The decision whether or not to entertain an action under its writ jurisdiction remains a decision to be taken by the High Court on an examination of the facts and circumstances of a particular case. 19. This understanding has been laid down in several decisions of the Hon'ble Supreme Court. In Uttar Pradesh State Spinning Co. Ltd. vs. R.S. Pandey, (2005) 8 SCC 264 , the Hon'ble Supreme Court held as under: “11. Except for a period when Article 226 was amended by the Constitution (Forty-Second Amendment) Act, 1976, the power relating to alternative remedy has been considered to be a rule of self imposed limitation. It is essentially a rule of policy, convenience and discretion and never a rule of law. Despite the existence of an alternative remedy it is within the jurisdiction or discretion of the High Court to grant relief under Article 226 of the Constitution. At the same time, it cannot be lost sight of that though the matter relating to an alternative remedy has nothing to do with the jurisdiction of the case, normally the High Court should not interfere if there is an adequate efficacious alternative remedy.” 20. The principle that the writ jurisdiction of a High Court can be exercised where no adequate alternative remedies exist can be traced even further back to the decision of the Constitution Bench of the Hon'ble Supreme Court in State of Uttar Pradesh vs. Mohammad Nooh, 1958 SCR 595 , where Justice Vivian Bose observed: “10. The principle that the writ jurisdiction of a High Court can be exercised where no adequate alternative remedies exist can be traced even further back to the decision of the Constitution Bench of the Hon'ble Supreme Court in State of Uttar Pradesh vs. Mohammad Nooh, 1958 SCR 595 , where Justice Vivian Bose observed: “10. In the next place it must be borne in mind that there is no rule, with regard to certiorari as there is with mandamus, that it will lie only where there is no other equally effective remedy. It is well established that, provided the requisite grounds exist, certiorari will lie although a right of appeal has been conferred by statute. (Halsbury's Laws of England, 3rd Ed., Vol. 11, p. 130 and the cases cited there). The fact that the aggrieved party has another and adequate remedy may be taken into consideration by the superior court in arriving at a conclusion as to whether it should, in exercise of its discretion, issue a writ of certiorari to quash the proceedings and decisions of inferior courts subordinate to it and ordinarily the superior court will decline to interfere until the aggrieved party has exhausted his other statutory remedies, if any. But this rule requiring the exhaustion of statutory remedies before the writ will be granted is a rule of policy, convenience and discretion rather than a rule of law and instances are numerous where a writ of certiorari has been issued in spite of the fact that the aggrieved party had other adequate legal remedies.” 21. The mere existence of alternate forums where the aggrieved party may secure relief does not create a legal bar on a High Court to exercise its writ jurisdiction. It is a factor to be taken into consideration by the High Court amongst several factors. Thus, the mere fact that the High Court at Madras is capable of granting adequate relief to the Appellant does not create a legal bar on the Bombay High Court exercising its writ jurisdiction in the present matter.” 14. Since the interpretation of statute is involved in the present case, therefore, it is only this Court that can adjudicate on such matters and the same cannot be left to the authorities constituted under the Act. Therefore, the objection of Mr. Chandel is overruled. 15. Since the interpretation of statute is involved in the present case, therefore, it is only this Court that can adjudicate on such matters and the same cannot be left to the authorities constituted under the Act. Therefore, the objection of Mr. Chandel is overruled. 15. In order to appreciate the controversy, it would be necessary to reproduce Section 35-A and Section 37 of the Act, which read as under: “35-A. Power of Registrar to constitute new committee in certain case - (1) Where in any Co-operative society a committee constituted in accordance with the provisions of this Act, rules and bye-laws does not exist; the Registrar may, notwithstanding anything to the contrary contained in this Act or rules or bye-laws, constitute by notification a committee for such society consisting of such number of members and not exceeding eleven out of whom not less than one third shall be share holders of such society, as he may deem fit: Provided that if the number of the members of the committee so constituted is less than eleven, the Registrar may, from time to time, add a member or members to the committee. (2) A committee constituted under Sub-section (1) shall be deemed to be committee for all the purposes of this Act, rules and bye-laws and shall continue to function for a period of two years or until such period as a committee for such society is constituted in accordance with the provisions of this Act, rules and bye-laws, whichever expires earlier: Provided that the Government may by notification extend the period of two years so as not to exceed in the aggregate three years.” “37. Super-Session of Committee - (1) If, in the opinion of the Registrar, a committee of any co-operative society or any member thereof persistently makes default or is negligent in the performance of the duties imposed on it or him by this Act or the rules or the bye-laws, or commits any act which is prejudicial to the interest of the society or its members, the Registrar may, after giving such committee or member, as the case may be, an opportunity to state its objections, if any, by order in writing: (a) remove the committee: (i) order fresh election to the committee. (ii) appoint one or more administrators who need not be members of the society, to manage the affairs of the society for a period not exceeding one year specified, in the order which period may, at the discretion of the Registrar, be extended from time to time, so however, that the aggregate period does not exceed five years. (b) remove the member and get the vacancy filled up for the remaining period of the outgoing member, according to the provisions of this Act, the rules and the bye-laws. (1-A) Where the Registrar, while proceeding to take action under sub-section (1) is of the opinion that suspension of the committee or any member during the period of proceedings is necessary in the interest of the Co-operative society, he may suspend such committee or member, as the case may be, and where the committee is suspended, make such arrangements as he think proper for the management of the affairs of the society till the proceedings are completed: Provided that if the committee or member so suspended is not removed, it or he shall be reinstated and the period of suspension shall count towards its or his term. (2) The Registrar may fix such remuneration for the administrator, as he may think fit. Such remuneration shall be paid out of the funds of the society. (3) The administrator shall, subject to the control of the Registrar and to such instructions as he may from time to time give, have power to perform all or any functions of the committee or of any officer of the society and take all such actions as may be required in the interest of the society. (4) The administrator shall at the expiry of his term of office, arrange for the constitution of a new committee in accordance with the bye-laws of the society. (5) Before taking any action under sub-section (1) in respect of a Co-operative society, the Registrar shall consult the financing institution to which it is indebted. (6) A member who is removed under sub-section (1) may be disqualified for being elected to any committee for such period not exceeding three years as the Registrar may fix and the said period shall commence after the expiry of the term of the committees from which he is removed. The section provides for the removal of the committee of a cooperative society, if it mismanages its affairs. The section provides for the removal of the committee of a cooperative society, if it mismanages its affairs. It also provides further for the appointment of an administrator in place of expelled management, till a new committee is elected.” 16. According to the petitioners, respondent No. 3, after having invoked Section 37(1)(a) of the Act, was required to complete the action under such section by following the provisions of Section 37(1)(i) and (ii) which provide for ordering fresh election to the committee; or appointing one or more administrators who need not be members of the society to manage the affairs of the society for a period not exceeding one year specified, but respondent No. 3 could not have resorted to Section 35-A by appointing nominated committee which as against the appointment of Administrator is for three years and this would amount to defeating the very purpose of the Act. 17. On the other hand, the learned Additional Advocate General and Mr. Hamender Chandel, learned counsel for the private respondents would argue that after having invoked Section 37(1)(a) of the Act, there existed no Managing Committee in the respondent No. 4-Society and, therefore, respondent No. 3 was well within its right in exercising one of the options that was available to him (as mentioned above) and, therefore, no fault can be found in the action of respondent No. 3. In addition thereto, Mr. Hamender Chandel, would argue that in the language used in Section 37, there is semicolon used therein, therefore, each of the remedies resorted to in the said Section was independent and thus fully empowered respondent No. 3 to take resort to Section 35-A of the Act. 18. In interpretation of statute by Bindra it is observed that “Punctuation marks do not control the meaning of a statutory provision if it is otherwise obvious.” 19. In Law Lexicon comma is defined as “The smallest division of a sentence in language. The comma and semicolon are both used for the same purpose to punctuation, namely, to divide sentences and part of sentences; the only difference being that the semicolon makes the division a little more prolonged than the comma.” Semi-colon is defined as “According to well established grammatical rules, this is a point only used to separate parts of a sense more distinctly than a comma.” 20. The Hon'ble Supreme Court in Dadaji vs. Sukhdeobabu, AIR 1980 SC 150 , was pleased to observe that it is well known that punctuation marks by themselves do not control the meaning of a statute when its meaning is otherwise obvious. What the Court must see is the object of the Act. 21. Bearing in mind the aforesaid, it would be noticed that Section 35-A of the Act was not there when the Original Act of 1968 was promulgated and was introduced by way of amendment initially by Ordinance and thereafter by the H.P. Cooperative Societies (Amendment) Act, 1976. The statement of Objects and Reasons for introducing the Bill, reads as under: “STATEMENT OF OBJECTS AND REASONS: In order to ensure effective implementation of the Himachal Pradesh Co-operative Societies Act, 1968 (hereinafter called the principal Act) it is considered expedient that the Registrar be empowered to direct amendment of bye-laws of any co-operative society and also to register the same if it appears that such an amendment is necessary or desirable in the public interest or in the interest of the society/Co-operative movement. Further in order to weed out the weak co-operative units it is essential to empower the Registrar to order the amalgamation, re-organisation or conversion into any other class of societies or order that any society should transfer its assets and liabilities in whole or part in the public interest. Of late it has been experienced that the higher level co-operative institutions are not being managed effectively by the managing committees. Besides, in order to safeguard the interests of the State Government in the case of such co-operative institutions where the Government has subscribed the share capital of rupees five lakhs or more or the Government has assisted indirectly the necessary provisions are required to be made in the Law. There are no powers under which the Registrar can order suspension of members of managing committees during the pendency of the proceedings relating to suspension of the managing committees under section 37 of the principal Act and he has also no powers to extend the period of Administrator(s) appointed under the aforesaid section beyond two years which in some case appears inadequate to put the society on sound footings. It is desirable that such a provision should be made in the Law. It is desirable that such a provision should be made in the Law. Due to upward trend of prices of agricultural inputs etc., it is also desirable to increase the ceiling of Rs. 1,000 under section 47 of the Act. Section 52 of the principal Act provides for the first charge only in respect of produce of land and the industrial implements, which is inadequate. As such it has been decided to make a provision whereby such charge may also be created on the other movables or the loanees. Further the Registrar has been armed with powers to issue certificate for recovery of crop loans as arrears of land revenue. In terms of the existing provisions of sub-section (1) of section 98 of the principal Act only the Deputy Minister dealing with Co-operation can be a Vice-chairman of the Council and there is no mention of the State Minister who at present is dealing with Co-operation. It is, therefore, decided to do away with this anomaly and to make the necessary amendments in the principal Act so that the Ministers of all ranks dealing with the Co-operation should be associated with the functioning of the Council. Since the number of Apex Level Societies is more than one and as such it is necessary to substitute the work “Chairman” with the word “Chairmen” in section 98(1)(iii) of the principal Act. Section 108 of the principal Act does not make them mention of section 93 which is co-related to sections already mentioned therein. The necessary insertion of section 93 in this section is desirable. The Legislative Assembly was not in session and circumstances existed which rendered it necessary for the Governor to take immediate action by promulgating an Ordinance under Article 213(1) of the Constitution of India. Accordingly Ordinance i.e. The Himachal Pradesh Cooperative Societies (Amendment) Ordinance, 1975 (Ordinance No. 4 of 1975) was promulgated on 6-11-1975. This Ordinance is required to be replaced by an amendment Act. This Bill seeks to achieve the aforesaid objections and to replace the aforesaid Ordinance without any modification. SIMLA The February, 1976 MANSA RAM, Minister-in-charge.” 22. Accordingly Ordinance i.e. The Himachal Pradesh Cooperative Societies (Amendment) Ordinance, 1975 (Ordinance No. 4 of 1975) was promulgated on 6-11-1975. This Ordinance is required to be replaced by an amendment Act. This Bill seeks to achieve the aforesaid objections and to replace the aforesaid Ordinance without any modification. SIMLA The February, 1976 MANSA RAM, Minister-in-charge.” 22. It would be evident from a bare reading of Section 35-A that the same can be invoked by the Registrar only where in any co-operative society, a committee constituted in accordance with the provisions of the Act, rules and bye-laws does not exist, but the same cannot be invoked in the cases of Society where there exists a Managing Committee and the same has been superseded by the Registrar himself by invoking the powers of Section 37 of the Act. That would amount to defeating the very provisions of the Act. The Registrar cannot firstly by superseding the Committee under Section 37 and thereby making the Managing Committee non-existent cannot thereafter invoke the provisions of Section 35-A of the Act by claiming that the committee constituted in accordance with the provisions of the Act does not exist. The respondent No. 3 cannot take advantage of his act of superseding the Committee to justify his action by appointing a new Committee under Section 35-A of the Act. The action of respondent No. 3 is clearly in violation of the law and cannot therefore be sustained. 23. As a last ditch effort, Mr. Hamender Chandel, learned counsel for the private respondents would argue that since the Section 35-A is special provision and begins with non-obstante clause, therefore, the other provisions of the Act have to give way to the provisions of Section 35-A. 24. A non-obstante clause is a legislative device which is usually employed to give overriding effect to certain provisions over some contrary provisions that may be found either in the same enactment or some other enactment. Union of India and Another vs. G.M. Kokil and Others, 1984 (Supp) SCC 196 and R.S. Raghunath vs. State of Karnataka and Another, (1992) 1 SCC 335 . 25. Union of India and Another vs. G.M. Kokil and Others, 1984 (Supp) SCC 196 and R.S. Raghunath vs. State of Karnataka and Another, (1992) 1 SCC 335 . 25. No doubt, Section 35-A contains a non-obstante clause which would invariably give overriding effect to certain other provisions of the Act but nonetheless the same cannot be applied in the present case for the simple reason that for invoking the Section 35-A condition precedent is that at the time of invoking this provision there does not exist a committee constituted in accordance with the provisions of this Act, rules and bye-laws. But once a Committee exists and has thereafter been superseded by the Registrar under Section 37 of the Act, this power under Section 35-A cannot be invoked or else as it would amount to playing mischief with the provisions of the Act. 26. The remedy under Section 35-A and Section 37 of the Act are totally separate and distinct and therefore, operate in different fields. Moreover, once the Registrar has resorted to the provisions of Section 37(1)(a) then the Registrar by superseding the Committee was required to take recourse to other provisions as contemplated in this Section i.e. Section 37 itself and could not have mischievously resorted to Section 35-A. 27. Having said so, I find merit in these petitions and the same are accordingly allowed and the notification issued by respondent No. 3 appointing a Nominated Committee in respondent No. 4-Society, dated 28.3.2019 (Annexure P-2) is quashed and set-aside and respondent No. 3 is directed to appoint Administrator in the respondent No. 4-Society as per the provisions of Section 37 of the Act to run the day to day affairs of the Society. 28. However, before parting it needs to be noticed that even though both these petitions are being allowed, however, the appointment of the petitioner in CWP No. 1224 of 2019 in the respondent No. 4-Society as Secretary cannot be restored in view of the criminal cases that are pending against him. 29. Both the petitions are disposed of in the aforesaid terms, leaving the parties to bear their own costs. Pending applications, if any, also stand disposed of.