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2019 DIGILAW 464 (KER)

V. R. Bhaskaran v. State Of Kerala

2019-06-19

DEVAN RAMACHANDRAN

body2019
JUDGMENT : Among the provisions for the election and appointment of a Managing Committee of a Society in Section 28 of the Kerala Co-operative Societies Act ('KCS Act' for short), is also a stipulation that one seat must be reserved for members having a deposit of Rs.10,000/- and above. It is this provision on which the controversies in this case revolves. 2. As I have indicated above, since the answers to be given by this Court on the various contentions of the parties are edificed on the aforesaid stipulation contained in sub clause (IC) of Section 28 of the KCS Act, I deem it appropriate to extract the same as under. “[(IC) Notwithstanding anything contained in the bye-laws of a Primary Credit Society or an Urban Co-operative Society, one seat in the committee of each such Society shall be reserved for the members having a deposit of ten thousand rupees and above]” 3. As is ineluctable from the above extracted provision, the mandate of the KCS Act is that whatever be the stipulations in the bye-laws of a Society, being a Primary Credit Society or an Urban Co-operative Bank, one seat in its Managing Committee shall be reserved for members having a deposit of Rs.10,000/- and above. It is without doubt that the provisions of the Act would certainly over-ride conflicting provisions in the bye-laws and this is more so in the case of this Sub-section because, it itself provides for. Hence, whatever be the stipulations in the bye-laws, it becomes necessary to be ensured that one seat in the Managing Committee of the Societies enumerated therein, shall be reserved for members having a deposit of Rs.10,000/- and above. 4. That being so, the bye-laws with respect to the fifth respondent-Keezhallur Service Cooperative Bank Ltd. No.F1455 (hereinafter referred to as it 'Society' for short), provides that two seats in the Managing Committee shall be reserved for members having a deposit of Rs.50,000/- and above, with a further condition that they are without any other liability. The Kerala Co-operative Election Commission, however, while issuing Ext.P1 election notification to the Managing Committee of the said Bank, fixed the various constituencies, of which category B was shown as two seats for members having a deposit of Rs.10,000/- and above. The Kerala Co-operative Election Commission, however, while issuing Ext.P1 election notification to the Managing Committee of the said Bank, fixed the various constituencies, of which category B was shown as two seats for members having a deposit of Rs.10,000/- and above. The petitioner, who is the present President of the Society, asserts that this constituency in Ext.P1 notification is contrary to the bye-laws and therefore, that this Court set aside the notification on that short ground. 5. I have heard Sri. K.Ramakumar, the learned Senior Counsel, assisted by Sri.S.M.Prasanth, learned counsel for the petitioner; Sri.Ramesh Chander, learned Senior Counsel, assisted by Sri.Bijoy Joseph, learned counsel appearing for the fifth respondent Society; Sri.R.Lakshmi Narayan, learned standing counsel for the second respondent-State Co-operative Election Commission and Smt.C.S.Sheeja, learned Senior Government Pleader appearing on behalf of the State of Kerala and the other official respondents. 6. Sri.K.Ramakumar, the learned Senior Counsel, started his submissions by drawing my attention to the provisions of the Constitution of India with respect to the conduct of elections to Co-operative Societies, as are ingrained in Article 243ZA, then showing me Section 13A of the KCS Act which mandates that every Society shall make its bye-laws consistent with the provisions of the said Act and Rules and that no provision in such bye-laws can be contrary to the statutory mandate. The learned Senior Counsel, thereafter, read me the provisions of Rule 35A to assert that elections can be conducted by the State Election Commission only in the manner as is postulated therein and then proceeded to contend that under sub rule (3) thereof, the area or constituencies have to be specified by the Election Commission, in the election notification, solely in terms of the bye-laws. 7. The learned Senior Counsel thus asserted that when the bye-laws provided that two seats shall be reserved for members with a minimum deposit of Rs.50,000/- and above, the Election Commission had no other choice but to accept the same; and consequently, that Ext.P1 notification, wherein the threshold for these two seats have been lowered to Rs.50,000/-, is contrary to law and therefore, untenable. He, thus, prayed that Ext.P1 be set aside and that the Election Commission be directed to take fresh action in terms of law for the conduct of elections to the Managing Committee of the fifth respondent-Society. 8. He, thus, prayed that Ext.P1 be set aside and that the Election Commission be directed to take fresh action in terms of law for the conduct of elections to the Managing Committee of the fifth respondent-Society. 8. Sri.Ramesh Chander, the learned Senior Counsel appearing for the fifth respondent Society, confirmed that his client is a Primary Credit Society and therefore, susceptible to the rigor of Subsection( IC) of Section 28 of the KCS Act. However, his submissions with respect to the constituencies for elections to the Society is that since Subsection( IC) of Section 28 only provides that one seat be reserved for members having a deposit of Rs.10,000/- and above, the provisions in Ext.P2 byelaws of the Society, which reserves two such seats for members having deposit of more than Rs.50,000/- is in order and therefore, not in conflict with the statute. The essence of the submissions of the learned Senior Counsel is that Sub-section(IC) extracted afore only commands that a seat be reserved for a member having a deposit of Rs.10,000/- and above and logically, therefore, Rs.50,000/- being more than Rs.10,000/-, the rigor of that section has been fully complied with. He also, therefore, prays that Ext.P1 election notification, issued by the Election Commission, be set aside, it being contrary to the bye-laws of the Society and therefore, against the mandate of the Rule 35A of the KCS Rules. 9. In answer to the afore submissions of the learned Senior Counsel for the parties as afore, the learned Standing Counsel for the Election Commission, Sri.R.Lakshmi Narayan, submitted that the provisions of the Sub-section(IC) of the Section 28 is unmistakable that every member with a minimum deposit of Rs.10,000/- and above has a vested right to compete to a seat which is to be reserved for that category. Sri.Lakshmi Narayan added that, going by the submissions of Sri.K.Ramakumar and Sri.Ramesh Chandar, the learned Senior Counsel, the members with deposits between Rs.10,000/- and Rs.49,999/- would stand excluded from the constituency reserved and that this is contrary to the provisions of Sub-section(IC) of Section 28 of the KCS Act. He asserts that, therefore, the Election Commission was obligated in law to act as per the provisions of the statute and make necessary alterations and corrections in the constituencies as is originally provided in Ext.P2 bye-laws. 10. He asserts that, therefore, the Election Commission was obligated in law to act as per the provisions of the statute and make necessary alterations and corrections in the constituencies as is originally provided in Ext.P2 bye-laws. 10. The learned Senior Government Pleader, Smt.C.S.Sheeja, appearing on behalf of the State of Kerala and the Joint Registrar of Co-operative Societies, affirms and adopts most of the submissions of Sri.R.Lakshmi Narayan, supplementing that it is clear from Section 13A earlier cited by Sri.K.Ramakumar, the learned Senior Counsel, that the provisions of the bye-laws will have to comply implicitly with the provisions of the KCS Act. She says that since the Sub-section(IC) of the Section 28 provides for a reservation in favour of every member who has a deposit of Rs.10,000/- and above, the provisions of the bye-laws, which restrict the reservation to persons having a deposit of Rs.50,000/- and above alone, is contrary to the KCS Act and therefore, illegal. She thus prays that elections pursuant to Ext.P1 be allowed to continue; adding that, if it is not so, then it is certain that the present Managing Committee's term will expire, leading to a Part-Time Administrator or Administrative Committee to be appointed and this will not be in the interests of the petitioner or that of the Society. She completed her submissions by asserting that the Society is a Primary Credit Society, going by Section 2 (od) of the KCS Act; and therefore, that they cannot get away from the rigor of Sub-section(IC) of Section 28 of the KCS Act. 11. I have considered the submissions made by the learned Senior Counsel and the various counsel for the parties very carefully; and I am drawn to a firm conclusion that Ext.P1 notification suffers from the vice of being contrary, both to the bye-laws and to the statute. I will explain my view presently, after referring to the provisions of Sub Section(IC) of the Section 28 again. 12. As it ineluctable from Sub-section(IC) of Section 28, every election to a Primary Credit Society or an Urban Co-operative Bank shall be conducted after reserving one seat to its Managing Committee for the members having a deposit of Rs.10,000/- and above. This section starts with non-obstante clause which provides that this reservation be made “notwithstanding anything contained in the bye-laws”. As it ineluctable from Sub-section(IC) of Section 28, every election to a Primary Credit Society or an Urban Co-operative Bank shall be conducted after reserving one seat to its Managing Committee for the members having a deposit of Rs.10,000/- and above. This section starts with non-obstante clause which provides that this reservation be made “notwithstanding anything contained in the bye-laws”. Obviously, therefore, even if the stipulations in the bye-laws are to the contrary or silent on this, the provisions of Subsection( IC) of Section 28 will have to be applied and a reservation for members with a deposit of Rs.10,000/- and above will have to be made. However, the statute only provides for one seat; whereas in Ext.P1, the Co-operative Election Commission has reserved two seats. Sri.R.Lakshmi Narayan is unable to tell me why this was done, except that this was done to maintain the ratio between other constituencies. I am afraid that I cannot accede this because, when the statute provides that one seat be reserved, only that seat is necessary to be reserved and no ratio or balance between the other constituencies being mandated in the KCS Act or Rules, such extra reservation will certainly have to fail. 13. That said, the next question is whether the Election Commission was right in reducing the value of the shares with respect to the constituency in the bye-laws from Rs.50,000/- to Rs.10,000/-. It is luculent from Ext.P2 bye-laws that it provides for reservation of two seats for members having more than Rs.50,000/- in share value. Going by Rule 35A, as has been rightly pointed out by the learned Senior Counsel, Sri.K.Ramakumar, the provisions of the bye-laws will have to be given primacy, since only a person who is qualified as per its mandate, can stand for elections and seek to be elected. It is also equally clear from Rule 35A(3) that the area or constituency as specified in the bye-laws will have to be followed by the Election Commission while issuing their notification. However, the Election commission will also have to see that the provisions of the Act and Rules are also complied with and put into operation without fault. 14. Therefore, it becomes inevitable that apart from the constituencies shown in the byelaws, the constituency as provided for in Subsection(IC) of the Section 28 also ought to have been included. However, the Election commission will also have to see that the provisions of the Act and Rules are also complied with and put into operation without fault. 14. Therefore, it becomes inevitable that apart from the constituencies shown in the byelaws, the constituency as provided for in Subsection(IC) of the Section 28 also ought to have been included. In other words, even if the byelaws have a particular enumeration of the constituencies, the Election Commission certainly ought to have taken note of the impact of Subsection(C) of the Section 28 of the KCS Act and ought to have axiomatically provided for the statutory constituency as per its mandate. This, unfortunately, has not been done in Ext.P1; and what the Election Commission has done, presumably being under a mis-direction on account of the seeming conflict between these provisions, is that they reduced the value of the constituency in the bye-laws to Rs.10,000/- and thought that the rigor of Section 28(IC) would also thereby be satisfied. I am afraid that this cannot be permitted or condoned because, as I have already said above, the constituencies under the bye-laws will have to be maintained and additionally, the constituencies under the statute will also have to be provided for. This, not having been done in Ext.P1, it has to fail and consequently all proceedings pursuant thereto will also consequentially fall. 15. Resultantly, this writ petition is allowed, setting aside Ext.P1 notification, with an adjunct direction to the Second respondent-Election Commission to cease all proceedings pursuant to the said notification and await a fresh resolution to be passed by the fifth respondent for conduct of fresh elections to its Managing Committee. 16. Needless to say, the notification pursuant to such fresh resolution will be issued by the State Co-operative Election Commission, strictly in terms of the bye-laws of the Society, the mandate of Section 28 of the KCS Act and adverting to the observations of this Court afore. 17. I also leave liberty to the Election Commission to decide in future whether all the categories and reservations as afore can be made in the election notification and if for any reason, they are of the view that it cannot be done, then, after complying with the statutory mandate, they will issue necessary orders explaining as to why the reservation as per the bye-laws cannot be provided for. This writ petition is thus ordered.