Vareli Doodh Utpadak Sahkari Mandli Ltd. v. State Of Gujarat
2024-08-16
VAIBHAVI D.NANAVATI
body2024
DigiLaw.ai
ORDER : Vaibhavi D. Nanavati, J. 1. By way of present petition, the petitioners herein have prayed for the following reliefs: (a) YOUR LORDSHIP be pleased to issue writ of mandamus and/or any other appropriate writ, order or directions, directing the respondent nos.1 to 3 herein to declare that the respondent no. 4 as disqualified and remove the respondent nos. 4 as Chairman and Director of the respondent no.5 – society. (b) YOUR LORDSHIP be pleased to issue writ of mandamus and/or any other appropriate writ, order or directions, directing the respondent nos. 1 to 3 herein to initiate proceedings under the provisions of Section 76 (B) of the Act immediately and take appropriate steps expeditiously. (c) During pendency and final disposal of the present petition, YOUR LORDSHIPS may be pleased to pass necessary orders upon respondent nos.1 to 3 to investigate and submit the report before this Hon'ble Court in a time bound schedule. (d) During pendency and final disposal of the present petition, YOUR LORDSHIPS may be pleased to direct the respondent nos. 1 to 3 to produce the report before this Hon’ble Court in compliance to the Annexure-H of the order passed by this Hon’ble Court. (e) YOUR LORDSHIP be pleased to grant such other and further relief as may be deemed fit in the interest of justice. 2. Heard Mr. P.K. Jani, learned Senior Counsel appearing for the petitioners herein with Mr. Baiju Joshi, learned advocate appearing for the petitioners, Mr. R.R. Marshall, learned Senior Counsel appearing for Mr. Daifraz Havewalla, learned advocate appearing for respondent nos. 4 and 5 and Ms. Pooja Ashar, learned AGP appearing for the respondent State Authority. 3. By way of present petition, the petitioners herein have challenged the inaction on the part of the respondent nos. 1 to 3 in not initiating any proceedings against the respondent no. 4, who is disqualified and non-suited to hold the post of Chairman of respondent no. 5 – society which is known as ‘SUMUL’. Present petitioners herein stated that though this Court had directed the respondent authorities to take a decision by 30.11.2023, but as the present petitioners are unaware regarding whether the decision is taken or not by the Respondent Authorities and if it is taken, the same is not given to the present petitioners just to protect the respondent nos.
Present petitioners herein stated that though this Court had directed the respondent authorities to take a decision by 30.11.2023, but as the present petitioners are unaware regarding whether the decision is taken or not by the Respondent Authorities and if it is taken, the same is not given to the present petitioners just to protect the respondent nos. 4 and 5 from facing the proceedings under Section 76(B) of the Act. 3.1 The present petitioners are the societies registered under the provisions of Gujarat Cooperative Societies Act, 1961 (for short “the Act”) and Rules made thereunder and are body corporate under Section 37 of the Act. The respondent no. 5 herein is a specified society as well as federal society and the present petitioners are members of the respondent no. 5 – society. 3.2 On election of the respondent no. 5 – society which was held in August 2020, the respondent no. 4 herein was elected as Chairman of the respondent no. 5 – society. The petitioners herein approached the respondent no. 2 with a representation dated 21.04.2023, after the respondent no. 4 was elected as Chairman of the respondent no. 5 – society, one firm i.e. Rudra Enterprise came to be registered on 24.02.2021 whose proprietor is Vasu Pavankumar Mistry. Thereafter, on 24.06.2021, a partnership firm came to be registered i.e. Som Industries in which the said Vasu Pavankumar Mistry was amongst the partners along with two sons of the respondent no. 4 who is elected Chairman of respondent no. 5 – society. It was pointed out to the respondent no. 2 that the respondent no. 5 had given contract of polythene bags and other goods to Rudra Enterprise, who had not undertaken any productions and had purchased all the goods from Som Industries in which the two sons of the respondent no. 4 are the partners along with Vasu Pavankumar Mistry. The sister of the said Vasu Pavankumar Mistry i.e. Namrata Pavankumar Mistry is also amongst the partners of Som Industries. Under Clause 22 of Partnership Deed of Som Industries, it is provided that if any dispute arises under such partnership, than the parties would be amenable to the arbitration, wherein, the respondent no. 4 herein and the father of Vasu Pavankumar Mistry and Namrata Pavankumar Mistry viz. are to function as Arbitrators.
Under Clause 22 of Partnership Deed of Som Industries, it is provided that if any dispute arises under such partnership, than the parties would be amenable to the arbitration, wherein, the respondent no. 4 herein and the father of Vasu Pavankumar Mistry and Namrata Pavankumar Mistry viz. are to function as Arbitrators. It was also pointed out that the said Pavankumar Mistry is associated with SUMUL – respondent no. 5 herein as a contractor. Sum and substance of the said representation is that the respondent no. 4 is directly and indirectly connected with the contract undertaken by SUMUL and therefore, under the provision of bye-laws of respondent no. 5, the respondent no. 4 is non-suited, disqualified and ineligible to hold the post of Director as well as the post of Chairman of the respondent no. 5. By the application dated 21.04.2023, representation was sent to the respondent no. 2, whereby, the respondent no. 2, by the order dated 14.02.2024, rejected the said application. The aforesaid order came to be passed upon an inquiry initiated by the District Registrar, Cooperative Societies upon the representation of the petitioners herein dated 21.04.2023 with respect to the petitioners’ representation. The order is duly produced at page 70 (Annexure R4). 4. Mr. P.K. Jani, learned Senior Counsel appearing for the petitioners vehemently relied on a chart prepared and produced by the petitioners herein at page 38 (Annexure G) which gives a fair idea with respect to the alleged contract entered into between Som Enterprise, Rudra Enterprise and SUMUL Dairy. Placing reliance on the aforesaid chart, it is submitted that the respondent no. 4’s sons are the partners in Som Industries and the said partners supplied materials to Rudra Enterprise. In turn, Rudra Enterprise is one of the agencies who provided polythene bags to the respondent no. 5. It is submitted that Rudra Enterprise does not produce the bags, however, the same are purchased from Som Industries. It is submitted that the aforesaid is placed before the Purchase Committee of the respondent no. 5 of which the respondent no. 4 is also a member and issuance of contract in favour of Rudra Enterprise resultantly proves the involvement of the respondent no. 4 and his sons in the contract with the respondent no. 5 – society.
It is submitted that the aforesaid is placed before the Purchase Committee of the respondent no. 5 of which the respondent no. 4 is also a member and issuance of contract in favour of Rudra Enterprise resultantly proves the involvement of the respondent no. 4 and his sons in the contract with the respondent no. 5 – society. The aforesaid is therefore, violative of bye-laws of the society read with Section 76(B) of the Act and/or Rule 32 of the Gujarat Cooperative Societies Rules, 1961. 4.1 In view of the aforesaid, Mr. Jani, learned Senior Counsel submits that immediate actions were required to be taken and appropriate orders ought to have been passed by the Registrar, Cooperative Societies by removing the respondent no. 4 as Chairman of the respondent society. 4.2 It is submitted that the respondent no. 5 is a very well known brand popularly known as “SUMUL” and by practicing such misconduct, the respondent no. 4 has tarnished the image of the respondent no. 5 to which the present petitioners are members. Under such circumstances, appropriate directions be issued directing the respondent nos. 1 to 3 to remove the respondent no. 4 as Chairman of the respondent no. 5. 4.3 It is submitted that the petitioners herein are members of the respondent no. 5 society which is a federal society and the petitioners have a locus; as there is violation of the bye-laws of the respondent no. 5 read with Section 76(B) of the Act and Rule 32 of the Gujarat Cooperative Societies Rules, 1961 and therefore, the respondent no. 4 is not qualified and entitled to continue as Chairman of the respondent no. 5 – society. 4.4 It is submitted that the petitioners were never supplied with the report carried out pursuant to the order passed in Special Civil Application No. 17945/2023 dated 13.10.2023. Placing reliance on the aforesaid submissions, it is submitted that the prayers as prayed for are required to be allowed in light of such irregularities committed by the respondent no. 4 as the same are in breach of bye-laws of the society, more particularly, bye-law no. 35(b)(6). 5. Heard Mr. R.R. Marshal, learned Senior Counsel appearing for the respondent nos. 4 and 5. Reliance is placed on the affidavit-in-reply filed by the respondent no. 4. Placing reliance on the same, it is submitted that the deponent i.e. the respondent no.
4 as the same are in breach of bye-laws of the society, more particularly, bye-law no. 35(b)(6). 5. Heard Mr. R.R. Marshal, learned Senior Counsel appearing for the respondent nos. 4 and 5. Reliance is placed on the affidavit-in-reply filed by the respondent no. 4. Placing reliance on the same, it is submitted that the deponent i.e. the respondent no. 4 herein has been elected to the post of Chairman of the respondent no. 5 in the year 2020 and has been discharging his duty with all sincerity and honesty. It is submitted that just because the contract for polythene bags and other goods is given to one Rudra Enterprise, the petitioners have agitated the same before the authorities and had tried to malign the image of the respondent no. 4. It is submitted that such allegations are without any documentary proof. It is submitted that the contract was given to Rudra Enterprise and the respondent no. 4 is not holding any post in the said Rudra Enterprise. Rudra Enterprise was given contract to supply polythene bags and the same were supplied to the society. The said order was given to Rudra Enterprise upon inviting quotations from other suppliers and having found the rates reasonable, the work order was given to Rudra Enterprise which has not resulted into any monetary loss to the respondent no. 5. It is submitted that upon the representation that was preferred by the petitioners herein, dated 21.04.2023, the respondent no. 5 herein had submitted detailed replies, wherein, such allegations were denied and it was pointed out that all the facts including the modus operandi of the petitioners for removal of the respondent no. 4 from the post of Chairman was to achieve the malafide intention. It is submitted that it was the collective decision of the Committee to issue work order in favour of Rudra Enterprise, therefore, it is not at the instance of the respondent no. 4 that such contract is given to said Rudra Enterprise. It is submitted that if at all the petitioners are aggrieved by the impugned order passed by the respondent merely, it is open for the petitioners herein to prefer a revision application under Section 155 of the Cooperative Societies Act which is an alternative remedy.
4 that such contract is given to said Rudra Enterprise. It is submitted that if at all the petitioners are aggrieved by the impugned order passed by the respondent merely, it is open for the petitioners herein to prefer a revision application under Section 155 of the Cooperative Societies Act which is an alternative remedy. It is submitted that this Court may not exercise its extraordinary writ jurisdiction under Article 226 of the Constitution of India and relegate the petitioners herein to avail the alternative remedy as stated above. 5.1 Reliance is also placed on a comparative chart with respect to progress of the respondent no. 5 and which is duly produced at page 111 (Annexure R/4). Placing reliance on the same, it is submitted that the overall profit of the society i.e. the respondent no. 5 has increased in each of the subsequent years from 2019-2020 to 2022-2023. It is also submitted that the respondent no. 5 has given orders to different registered vendors, over and above, to Rudra Enterprise. Reliance is placed on the comparative table which indicates with respect to the number of bags given to various other vendors. It is submitted that there are more than 1200 societies which are members of respondent no. 5 – society out of which only five are litigating against the deponent. It is submitted that while purchasing the plastic bags from Rudra Enterprise, proper procedure has been followed and that there is no malpractice and no loss is caused to the respondent no. 5 – society and no personal gain to the respondent no. 4, as such. 5.2 In light of the aforesaid submissions, it is submitted that the present petition be dismissed, more particularly, when the petitioners case have no merits as also the petitioners have an alternative remedy under Section 155 of the Act to file a revision before the respondent State. 6. Ms. Pooja Ashar, learned AGP appearing for the respondent no. 2 has also relied on the affidavit-in-reply filed by the respondent State. It is submitted that the order passed by the respondent no. 2 is just and proper and requires no interference. It is submitted that upon an application received from the petitioners herein, the State Registrar directed the District Registrar to undertake the exercise of inquiry to inquire into the representation that was filed by the petitioners herein dated 21.04.2023.
It is submitted that the order passed by the respondent no. 2 is just and proper and requires no interference. It is submitted that upon an application received from the petitioners herein, the State Registrar directed the District Registrar to undertake the exercise of inquiry to inquire into the representation that was filed by the petitioners herein dated 21.04.2023. Reliance is placed upon the inquiry report at page 67, wherein, in page 68, the Competent Authority has opined that there does not appear to be any transaction with Som Industries of which the respondent nos. 4 sons are partners and the sister of the proprietor of Rudra Enterprise is also a partner. The contract to supply the plastic bags is between Rudra Enterprise and the respondent no. 5 and in view thereof, it is opined that there is no violation of either of the bye-laws. If there is no violation of bye-law 35(b)(6) or Section 76(B) of the Act under which the petitioners herein have asked the respondents to take action. In absence of any material, it was opined that there was no material to take action under Section 76(B) of the Act. Pursuant to the said report dated 03.11.2023, an order came to be passed on 14.02.2024 by Registrar, Cooperative Societies, wherein, the Registrar opined that since, the allegations made by the petitioners in the representation / complaint dated 21.04.2023, do no attract the ingredients of Section 76(B) of the Act. Therefore, the said representation came to be disposed of. 6.1 Placing reliance on the same, it is submitted that Section 76(B) contemplates that if in the opinion of Registry, any officer who makes 1) persistent default or 2) is negligent in performance of the duties imposed on him by this Act or the rules or the bye-laws or 3) does anything which is prejudicial to the interest of the society or 4) where the officer stands disqualified by or under the Act, the Registrar is empowered under Section 76(B) to remove such officer who has either elected or appointed after giving reasonable opportunity of hearing to the concerned officer. Once the order is passed under Section 76(B)(1), the Registrar is empowered under Sub-Section (2) of Section 76(B) to disqualify the officer for a period of six years from the date of such order.
Once the order is passed under Section 76(B)(1), the Registrar is empowered under Sub-Section (2) of Section 76(B) to disqualify the officer for a period of six years from the date of such order. 6.2 It is submitted an opinion is required to be formed by the Registrar before initiating proceedings under Section 76(B) of the Act. It is submitted that in the facts of the present case, the opinion of Registrar is formed and vide communication dated 12.04.2023, while taking into consideration the allegation made against the respondent no. 4 and also inquiry undertaken by the District Registrar, Cooperative Societies, Surat and the inquiry report dated 03.11.2023, it was thought fit that ingredients of Section 76(B) of the Act are not attracted and further actions under Section 76(B) of the Act came to be dropped. It is submitted that the action / inquiry was undertaken pursuant to the representation made by the petitioners dated 21.04.2023 and upon thoughtful consideration, a decision / opinion under Section 76(B) of the Act is taken and the representation of the petitioners is disposed of on 14.02.2024. It is submitted that it is also open for the petitioners herein to avail a remedy by filing revision under Section 155 of the Act. It is lastly submitted by Ms. Ashar, learned AGP that as the petitioners have chosen to not to challenge the order / communication dated 14.02.2023 and in view thereof, the question of interfering with the said order does not arise. Placing reliance on the aforesaid submissions, it is submitted that no interference is called for in the prayers as prayed for in the present petition. 7. In rejoinder Mr. Jani, learned Senior Counsel has placed reliance on the rejoinder filed by the petitioners herein and has submitted that while passing the impugned order dated 14.02.2024, both the authorities have failed to consider the documents produced on record by the petitioners herein on 03.11.2023, wherein, the petitioners herein had produced on record the documents which were germane for adjudication of the representation filed by the petitioners herein, the aforesaid documents are a proof with respect to the connection of Rudra Enterprise and Som Industries. It is submitted that Rudra Enterprise is sister concern of Som Industries.
It is submitted that Rudra Enterprise is sister concern of Som Industries. Reliance is also placed on audit reports and it is vehemently submitted that the aforesaid documents are not considered by the Competent Authority which are a proof with respect to the allegations raised by the petitioners herein in the representation dated 21.04.2023. 8. Having heard the learned advocates appearing for the respective parties, it emerges that the petitioners herein are societies registered under the provisions of Cooperative Societies Act and are governed by the Rules made thereunder and are a body corporate under Section 37 of the Act. The petitioners herein are members of the respondent no. 5 which is a specified society as well a federal society. The respondent no. 4 came to be elected as Chairman of the society pursuant to the election of the respondent no. 5 – society in August 2020. The petitioners preferred a representation to the State Registrar alleging that the respondent no. 4 herein is in violation of the bye- law 35(b)(6) of the Society and Section 76(B) of the Act. Considering the aforesaid representation, upon inquiry dated 14.02.2024, the respondent considered the grievance of the petitioners herein in the inquiry report which reads as under: As mentioned in the aforesaid letters, it is true that sons namely, Parth Mansinhbhai Patel and Krupal Mansinhbhai Patel of Mansinh Kalyansinh Patel and the son namely, Vasu Pavankumar Mistry and daughter namely, Namrata Pavankumar Mistry of Pavankumar Mistry, alongwith them, Bharatbhai Naranbhai Patel - are the partners in Som Industries, partnership firm. But, Mansinhbhai, President of the Federation is not a partner of said partnership firm. Therefore, such fact cannot be believed that he had formed / founded this firm and also that he availed the benefit through the federation. Further, the fact that as per the condition No.11 of Som Industries, Partnership firm, sons of said Mansinhbhai respectively have 20% share of each and the fact that Mansinhbhai is an Arbitrator in said firm, is factual. But, this name has not been mentioned by virtue of the President of Surat-Tapi District Milk Marketing Co- operative Federation Ltd. This name has been mentioned in his personal capacity. Keeping in view the same, by only involving just as an Arbitrator in any matter, his collusion cannot be proved.
But, this name has not been mentioned by virtue of the President of Surat-Tapi District Milk Marketing Co- operative Federation Ltd. This name has been mentioned in his personal capacity. Keeping in view the same, by only involving just as an Arbitrator in any matter, his collusion cannot be proved. Further, when Mansinhbhai is not a partner in the partnership firm, the fact that he formed / founded such firm and also that he availed the benefits through the Federation, cannot be believed. Further, upon considering the reply of Mansinhbhai regarding the representation, the said Mansinh Kalyansinh is not a partner in the partnership firm, namely, M/s Som Industries and Rudra Enterprise. Therefore, it cannot be believed that he has formed both the said partnership firms. Further, considering the reply of the Managing Director of Sumul Dairy, as per the procedure of Sumul Dairy for the purchase of polypropylene woven sack plastic, fabric materials manufactured from plastic, etc.; first of all, the requisitions are being sent by different departments, viz. Dairy Plant-THR Chalthan and other Departments regarding polythene bag. In pursuance of this requisition, the purchase department sends inquiry to 5 to 6 vendors registered with the Federation and calls for their quotations. Regarding the said quotations received, their comparison statements are prepared. Thereafter, the negotiations are done by the General Manager (Purchase) or Managing Director with the parties regarding said quotations received. If the quantity is higher, the order is issued to more than one parties and the quality of material being supplied by them is checked. Thereafter, the note regarding said purchase is being made by the Purchase Committee and the note of the Purchase Committee is being taken during ensuing Board meeting. In this case, the order has been issued by the Federation at the rates lesser than that decided by the Gujarat Co-operative Milk Marketing Federation Ltd. Thus, Mansinh Kalyansinh Patel, President of the Federation is not directly connected with the purchase procedure. Further, as the order has been issued by the Federation at the rates lesser than that decided by the Gujarat Co- operative Milk Marketing Federation Ltd., the fact of acting against the interest of the Federation cannot be believed. Also, as per the requirement, the purchase orders have been issued as per the requirement to different vendors out of the registered vendors.
Also, as per the requirement, the purchase orders have been issued as per the requirement to different vendors out of the registered vendors. The order has not only been issued to Rudra Enterprise and the material less than 25% of the requirement of the Federation has been purchased from it. Whereas, rest of the material has been purchased by other vendor. No material has been purchased by the Federation from M/s Som Industries. Therefore, the fact that by virtue of the President of the Federation, the benefit is being given to his sons, cannot be believed. Also, the purchase order has been issued by the Federation to Rudra Enterprise. Thereafter, if Rudra Enterprise purchase the material from M/s Som Industries or any other firm and supply the same to the Federation, it cannot be proved that President of the Federation got the economic gain through it. Therefore, violation of the by-laws of the Federation or the provision of the Co-operative Act cannot be believed. Therefore, on believing that he has violated the provision of section-35(b)(6) of the by-law of the Federation and to take action against him under provision of section-76(b) of the Co-operative Act, does not appear just. Thus, on considering the application of the applicant and the reply given by Rudra Enterprise, Mansinhbhai Kalyanjibhai Patel, Managing Director of Surat-Tapi District Milk Marketing Federation, Surat and the proofs and evidences in the matter, it does not appear just to initiate procedure to remove under provision of section-76(b) of the Gujarat Co-operative Act, aforesaid Mansinhbhai Kalyanjibhai Patel, President of Surat-Tapi District Milk Marketing Federation, from the position of the Member of the Board of Directors of the Federation. As stated by aforesaid Inquiry Officer, on considering the statements and proofs and evidences produced by aforesaid Mansinhbhai Kalyanjibhai Patel, President and Managing Director of the Federation, this office is of the opinion that it does not appear just to initiate procedure to remove, under provision of section-76(b) of the Gujarat Co-operative Act, aforesaid President from the position of the Member of the Board of Directors of the Federation.
Apropos to the aforesaid report by order dated 14.02.2024, the representation preferred by the petitioners came to be disposed of taking into consideration the following: As per the aforesaid inquiry report, it is true that sons namely, Parth Mansinhbhai Patel and Krupal Mansinhbhai Patel of Mansinh Kalyansinh Patel and the son namely, Vasu Pavankumar Mistry and daughter namely, Namrata Pavankumar Mistry of Pavankumar Mistry, alongwith them, Bharatbhai Naranbhai Patel are the partners in Som Industries, partnership firm. But, Mansinhbhai, President of the Federation is not a partner of said partnership firm. Therefore, the fact that he formed / founded this firm and also that he availed the benefit through federation cannot be believed. Further, the fact that as per the condition no.11 of Som Industries, Partnership firm, sons of said Mansinhbhai have respectively 20% each share and the fact that Mansinhbhai is an Arbitrator in said firm, is factual. But, this name has not been mentioned by virtue of the President of Surat-Tapi District Milk Marketing Co-operative Federation Ltd. This name has been mentioned in his personal capacity. Keeping in view the same, by only involving just as an Arbitrator in any matter, his collusion cannot be proved. Further, when Mansinhbhai is not a partner in the partnership firm, the fact that he formed/ founded such firm and also that he availed the benefit through the Federation, cannot be believed. Further, on considering the reply of Mansinhbhai regarding the representation, the said Mansinh Kalyansinh is not a partner in the partnership firm namely, M/s Som Industries and Rudra Enterprise. Therefore, it cannot be believed that he has formed both the said partnership firms. Further, considering the reply of the Managing Director of Sumul Dairy, as per the procedure of Sumul Dairy for the purchase of Polypropylene woven sack plastic, fabric materials manufactured from plastic, etc.; first of all, the requisitions are being sent by different departments viz. Dairy Plant-THR Chalthan and other Departments regarding polythene bag. In pursuance of this requisition, the purchase department sends inquiry to 5 to 6 vendors registered with the Federation and calls for their quotations. Regarding the said quotations received, their comparison statements are prepared. Thereafter, the negotiations are done by the General Manager (Purchase) or Managing Director with the parties regarding said quotations received.
In pursuance of this requisition, the purchase department sends inquiry to 5 to 6 vendors registered with the Federation and calls for their quotations. Regarding the said quotations received, their comparison statements are prepared. Thereafter, the negotiations are done by the General Manager (Purchase) or Managing Director with the parties regarding said quotations received. If the quantity is higher, the order is issued to more than one parties and the quality of material being supplied by them is checked. Thereafter, the note regarding said purchase is being made by the Purchase Committee and the note of the Purchase Committee is being taken during ensuing Board meeting. In this case, the order has been issued by the Federation at the rates lesser than that decided by the Gujarat Co-operative Milk Marketing Federation Ltd. Thus, Mansinh Kalyansinh Patel, President of the Federation is not directly connected with the purchase procedure. Further, as the order has been issued by the Federation at the rates lesser than that decided by the Gujarat Co- operative Milk Marketing Federation Ltd., the fact of acting against the interest of the Federation cannot be believed. Also, as per the requirement, the purchase orders have been issued as per the requirement to different vendors out of the registered vendors. The order has not been only issued to Rudra Enterprise and the material less than 25% of the requirement of the Federation has been purchased from it. Whereas, rest of the material has been purchased by other vendor. No material has been purchased by the Federation from M/s Som Industries. Therefore, the fact that by virtue of the President of the Federation, the benefit is being given to his sons, cannot be believed. Also, the purchase order has been issued by the Federation to Rudra Enterprise. Thereafter, if Rudra Enterprise purchase the material from M/s Som Industries or any other firm and supply the same to the Federation, it cannot be proved that President of the Federation got the economic gain through it. Therefore, violation of the by-laws of the Federation or the provision of the Co-operative Act cannot be believed. Therefore, on believing that he has violated the provision of section-35(b)(6) of the by-law of the Federation and to take action against him under provision of section-76(b) of the Co-operative Act, does not appear just.
Therefore, violation of the by-laws of the Federation or the provision of the Co-operative Act cannot be believed. Therefore, on believing that he has violated the provision of section-35(b)(6) of the by-law of the Federation and to take action against him under provision of section-76(b) of the Co-operative Act, does not appear just. Thus, on considering the application of the applicant and statement given by Mansinhbhai Kalyanjibhai Patel, President and Managing Director of the Federation and the proofs and evidences, it does not appear just to initiate procedure to remove, under provision of section-76(b) of the Gujarat Co-operative Act, aforesaid President from the position of the Member of the Board of Directors of the Federation. It is requested to make note of the same. It is apposite to refer to the bye-laws upon which the petitioners are placing reliance and according to the petitioners, the respondent no. 4 has been violating the bye- laws 35(b)(6), which is produced as under: (35) The qualification of the member society and the representative of the member society for submitting the candidature in for election of the Board of Directors shall remain to be as under: (A) No representative of the member society shall be eligible for election to the Board of Directors, unless the Society that he represents – (1) has performed all the duties mentioned under the sub-rules 7(b)(1.1) to 7(b)(1.5) during the period up to 31st March of the previous year. (2) The Management Committee of the Society should have passed a resolution giving representation and a copy of the resolution with an affidavit affirming that any other representative of the Society is not being represented on the Board of Directors, must be sent to the Union by 31st March in the form of resolution prescribed by the Board of Directors of the Union. (3) The Society possesses the class 'A' or 'B' at the time of last assessment. (4) The society shall have held membership of the Union for a period of not less than two years and held at least one share of the Union as on 31st March of the previous year. (5) The society shall have supplied on an average at least 80 liters of milk per day to the Union in the previous financial year of the Union.
(5) The society shall have supplied on an average at least 80 liters of milk per day to the Union in the previous financial year of the Union. (6) The society shall have not sell milk or milk products to anyone other than the Union during the preceding accounting year of the Union except with the prior approval of the Union. 7) The society shall have not stopped supplying milk for 90 days during the preceding financial year of the Union except for the circumstances beyond the control. (8) Such Society should not have any dues to be paid to the Union or the Union must not have recovered the dues from such society with strict measures. (B) Any representative of the Member Society should have the qualifications as mentioned below for the election of the Board of Directors of the Union. (1) ……. (2) ……. (3) ……. (4) ……. (5) ……. (6) He shall not have entered into any contract directly or indirectly with the Union and shall not be associated with the Union in any business, nor shall he have any direct or indirect relationship therein. If he subsequently undertakes any such work, he shall be automatically dismissed from the membership of the Board of Directors. It is also apposite to refer to Section 76(B) of the Act: 76B. Removal of Office: (1) If, in the opinion of the Registrar, any officer makes persistent default or is negligent in performance of the duties imposed on him by this Act or the rules or the bye-laws or does anything which is prejudicial to the interests of the society or where he stands disqualified by or under this Act, the Registrar may, after giving the officer an opportunity of being heard, by order remove such officer and direct the society to elect or appoint a person or a qualified member in the vacancy caused by such removal and the officer so elected or appointed shall hold office so long only as the officer in whose place he is elected or appointed would have held if the vacancy had not occurred.
(2) The Registrar may, by order, direct that the officer so removed shall be disqualified to hold or to contest election for any office in the society from which he is removed and in any other society for a period not exceeding four years from the date of the order and such officer shall stand disqualified accordingly. 9. Having considered the aforesaid aspects, the impugned order passed by the respondent authority taking into consideration the factual position and has arrived to a conclusion that as such there is no such transaction between the respondent no. 4 and Som Industries of which the respondent no. 4’s sons are partners. The contract is between the respondent no. 5 and Rudra Enterprise of which neither the petitioners nor the petitioners’ sons are parties. In view thereof, there is no such transaction which can be said to have occurred between Som Industries and respondent no. 5. It is held by the respondent authority that the respondent no. 4 is not directly connected with the procedure of purchase. Further, as the order has been issued by the Federation at the rates lesser than that decided by the Gujarat Co-operative Milk Marketing Federation Ltd. Considering the aforesaid, it is held that such act cannot be held as an act against the Federation. It is further considered and held that the purchase orders have been issued as per the requirement to different vendors out of the registered vendors. The order has not only been issued to Rudra Enterprise and the material less than 25% of the requirement of the Federation has been purchased from the said enterprise. The rest of the material is purchased by other vendor. By virtue of the aforesaid, it is not believed that any benefit is extended to the respondent no. 4’s sons. It is also considered and held that the purchase order has been issued by the Federation to Rudra Enterprise. Rudra Enterprise purchased the material from M/s. Som Industries or any other firm and supply the same to the Federation, it cannot be proved that President of the Federation got the economic gain through it. In view of the aforesaid observations, the Competent Authority thought it fit that the same would, in no manner, violate the bye-laws of the society or no action is required to be undertaken under Section 76(B) of the Act.
In view of the aforesaid observations, the Competent Authority thought it fit that the same would, in no manner, violate the bye-laws of the society or no action is required to be undertaken under Section 76(B) of the Act. The documents which are placed on record by the petitioners herein by way of rejoinder, appears to have been produced on 13.07.2023, the day on which the report came to be sent. A receipt of the same receiving the said documents with a stamp is duly produced at page 135. So far as the decision in question is concerned, for the documents that are on record which are produced along with petition, this Court is not inclined to interfere in the order passed by the respondent authority, however, the Court is not conclusive as to how the documents which are placed on record by way of rejoinder or placed before the Competent Authority that whether they were considered or not for considering grievance raised by the petitioners. For the foregoing reasons, it is open for the petitioners herein to file a revision application under Section 155 of the Act. Section 155 of the Act reads thus: 155. Power of State Government and Registrar to call for proceedings of subordinate officers and to pass orders thereon. The State Government and the Registrar may call for and examine the record of any inquiry or the proceedings of any other matter of any officer subordinate to them, except those referred to in sub- section (9) of Section 150, for the purpose of satisfying themselves as to the legality or propriety of any decision or order passed, and as to the regularity of the proceedings of such officer. If in any case, it appears to the State Government, or the Registrar, that any decision or order or proceedings so-called for should be modified, annulled or reversed, the State Government or the Registrar, as the case may be, may after giving persons affected thereby an opportunity of being heard pass such order thereon as it or he may deem just. If the petitioners were to prefer a revision application, the respondent State would call for the records and examine the same with respect to the inquiry proceedings undertaken as also the order passed by the Competent Authority.
If the petitioners were to prefer a revision application, the respondent State would call for the records and examine the same with respect to the inquiry proceedings undertaken as also the order passed by the Competent Authority. If the petitioners would approach the competent forum by preferring a revision application, the findings arrived at by this Court which are for the purpose of deciding the issue in question, the same may not come in way while deciding such revision application. With the aforesaid directions, the present petition stands disposed of. 10. Mr. Baiju Joshi, learned advocate for the petitioners, after the order is passed, upon instructions, submits that the petitioners would prefer a revision application under Section 155 of the Act and the same be decided as expeditiously as possible. 11. Upon such request being made by Mr. Joshi, learned advocate, if the petitioners were to prefer revision application, the same be decided by the respondent – authority in accordance with law as expeditiously as possible.