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2025 DIGILAW 1518 (KER)

State Of Kerala v. Joe Thomas

2025-05-28

AMIT RAWAL, K.V.JAYAKUMAR

body2025
JUDGMENT Amit Rawal, J. This order shall dispose of thirty three (33) Intra Court appeals preferred by the State of Kerala against the judgment of the Single Bench wherein the respondent- petitioner had challenged the various amendments caused in the Kerala Co-operative Societies Act , Act No.9 of 2024 by inserting Section 14AA, Section s.28 (2A), 32, 33, 34A, 56, 57E and was successful viz-a-viz striking down the amendment in sub Section 2A of Section 28 and challenge with regard to the remaining amendment of the Act No.9 of 2024 under the Kerala Co-operative Societies Act did not find favour. 2. Thus we are only confined to the portion of the order starting from paragraphs 36 to 56 of the judgment under challenge pertaining to the findings of the Single Bench on the amendment introduced by sub Section 2A of Section 28 of the Act. The amendment caused by introduction of sub Section 2A of Section 28 inserted by Act No.9 of 2024 reads as under: 2A) Notwithstanding anything to the contrary contained in the Act, rules or in the bye-laws of a credit society, no member of the Committee of a society shall be eligible for election to the Committee for more than three consecutive terms, irrespective of whether the term is in full or in part. Explanation For the purpose of this sub-section, "credit society" means the Kerala State Co-operative Bank Limited, Primary Agricultural Credit Societies, Service Co-operative Banks, Regional Co-operative Banks, Rural Banks, Farmer's Service Co-operative Banks, Urban Co-operative Banks, The Kerala State Co- operative Agricultural and Rural Development Bank Limited, Primary Co-operative Agricultural and Rural Development Bank, Urban Co-operative Societies, Agricultural Improvement Co-operative Societies, Employees Credit Societies, Rural Cooperative Societies, Primary Housing Co-operative Societies and Kerala State Housing Federation. 3. The aforementioned amendment reveals that no member of the Committee of the Society shall be eligible for election to the Committee for more than three consecutive terms, irrespective of whether the term is in full or in part. The said amendment as per the explanation only relates to the credit societies indulging into extending the facility of loan. 3. The aforementioned amendment reveals that no member of the Committee of the Society shall be eligible for election to the Committee for more than three consecutive terms, irrespective of whether the term is in full or in part. The said amendment as per the explanation only relates to the credit societies indulging into extending the facility of loan. The credit societies which would mean the Kerala State Co-operative Bank Limited, Primary Agricultural Credit Societies, Service Co-operative Banks, Regional Co-operative Banks, Rural Banks, Farmer's Service Co-operative banks, Urban Co-operative Banks, the Kerala State Co-operative Agricultural and Rural Development Bank Limited, Primary Co-operative Agricultural and Rural Development Bank, Urban Co- operative Societies, Agricultural Improvement Co-operative Societies, Employees Credit Societies, Rural Co-operative Societies, Primary Housing Co-operative Societies and Kerala State Housing Federation. 4. By way of 97 th amendment in 2011 inserted with effect from 15.2.2012, PART IX-B was introduced in the Constitution of India by inserting Article 243-ZH to ZT. Article 243-ZJ deals with the number and term of members of board prescribing that the maximum number of directors of a Co-operative Society shall not exceed twenty-one (21) and term of office of elected members of the board and its office bearers shall be five years from the date of election and the election as per Article 243-ZK has to be conducted before the expiry of the term of the board. 5. The superintendence, direction and control of the preparation of electoral rolls for, and the conduct of, all elections to a co-operative Society shall vest in such an authority or body, as provided by the legislature of a State, by law provided that the Legislature of a State may, by law provide for the procedure and guidelines for the conduct of such elections. Article 243-ZK reads as under: 243-ZK. Election of members of board.- (1) Notwithstanding anything contained in any law made by the Legislature of a State, the election of a board shall be conducted before the expiry of the term of the board so as to ensure that the newly elected members of the board assume office immediately on the expiry of the term of the office of members of the outgoing board. (2) The superintendence, direction and control of the preparation of electoral rolls for, and the conduct of, all elections to a co-operative society shall vest in such an authority or body, as may be provided by the Legislature of a State, by law: Provided that the Legislature of a State may, by law, provide for the procedure and guidelines for the conduct of such elections. 6. 243-ZI deals with the incorporation of the Co-operative Societies. The same reads thus: 243-Z1. Incorporation of co-operative societies. Subject to the provisions of this Part, the Legislature of a State may, by law, make provisions with respect to the incorporation, regulation and winding up of co-operative societies based on the principles of voluntary formation, democratic member-control, member-economic participation and autonomous functioning. 7. On perusal of Article 243-ZI, it envisages the legislature of a State may, by law, make provisions with respect to the incorporation, regulation etc much less the autonomous functioning of the Society. 8. Simultaneously amendment was also caused in Article 19 of the Constitution of India dealing with protection of certain rights regarding freedom of speech, etc and under Article 19 (1)(c) extended right to form associations or unions also included Co-operative Societies. No doubt, the aforementioned provisions though granted the right to individual to form the Co-operative Societies as a fundamental right but the question which arises for adjudication is 'Whether the right to contest an election would relate to the amendment caused in incorporation of Section 19(1)(c) or not'. In other words, 'whether right to contest an election is a fundamental right or a common right'. 9. There has already been an adjudication on this issue when the State legislature of Haryana Government incorporated an amendment in the Haryana Panchaythi Raj Act, 1994 by incorporating the amendment in Section 175(1)(q) of the Haryana Panchayati Raj Act by forbidding a member of the Panchayats or Zila Parishads to continue as a member of the Panchayat, who has more than two living children. Meaning thereby, having more than two children was introduced as a disqualification. The aforementioned amendment was challenged before the High Court of Punjab and Haryana and the same was dismissed and the matter reached the Supreme Court in Javed and Others v. State of Haryana and Others ( 2003 (8) SCC 369 ). Meaning thereby, having more than two children was introduced as a disqualification. The aforementioned amendment was challenged before the High Court of Punjab and Haryana and the same was dismissed and the matter reached the Supreme Court in Javed and Others v. State of Haryana and Others ( 2003 (8) SCC 369 ). In the aforementioned judgment in paragraph 21, it was noticed that whether an amendment caused in the Act prohibiting the member of the Panchayat having more than two children to conduct the election is a fundamental right or a common law. While dealing with the aforementioned question, relied upon the various judgments, it was held that the right to elect, though fundamental but is, anomalously enough to be neither a fundamental right nor a common law right. It is pure and simple, a statutory right ie., the right to be elected and the right to dispute and election. The statutory creations are always subject to statutory limitation. Thus for all intents and purposes, the right to elect and contest election with statutory disqualifications cannot be a violation of fundamental rights. 10. The grounds which weighed with the Single Bench in striking out the amendment caused in Section 28(2A) of the Act primarily has been on the premise of being a fundamental right, autonomous power given to the Society to incorporate such conditions in the bye-laws of the Society with no power to the State legislature to cause amendment in the statute barring a member for contesting the elections who had been a member for a period of three years. Paragraph 36 to 56 of the findings of the Single Bench dealing with the vires of the amendment under sub Section 2A of Section 28 read thus: 36. Challenge to Section 28(2A) Section 28 of the Kerala Co-operative Societies Act , 1969 makes provisions for constitution of Committee for the management of the affairs of the Society. The Section provides that the General body of a Society shall constitute a Committee, for a period of five years, in accordance with the bye-laws and entrust the Management of the affairs of the Society to such Committee. The Section provides that the General body of a Society shall constitute a Committee, for a period of five years, in accordance with the bye-laws and entrust the Management of the affairs of the Society to such Committee. Sub-section (2A) which is incorporated by addition as per the Act 9 of 2024 reads as follows: (2A) Notwithstanding anything to the contrary contained in the Act, rules or in the bye-laws of a credit society, no member of the Committee of a society shall be eligible for election to the Committee for more than three consecutive terms, irrespective of whether the term is in full or in part. Explanation — For the purpose of this sub-section, “credit society” means the Kerala State Co-operative Bank Limited, Primary Agricultural Credit Societies, Service Co-operative Banks, Regional Co- operative Banks, Rural Banks, Farmer's Service Co-operative Banks, Urban Co- operative Banks, The Kerala State Co- operative Agricultural and Rural Development Bank Limited, Primary Co- operative Agricultural and Rural Development Bank, Urban Co-operative Societies, Agricultural Improvement Co- operative Societies, Employees Credit Societies, Rural Cooperative Societies, Primary Housing Co-operative Societies and Kerala State Housing Federation. By the said amendment, Members of Managing Committees of Societies are restrained from contesting in the election to the Managing Committees for more than three consecutive terms, irrespective of whether the term is in full or in part. 37. Going by Section 28(2A), such restraint will apply only to the members of a Credit Society. The explanation under Section 28(2A) defines the term “Credit Society” to mean the Kerala State Co- operative Bank Limited, Primary Agricultural Credit Societies, Service Co-operative Banks, Regional Co-operative Banks, Rural Banks, Farmers Service Co-operative Banks, Urban Co- operative Banks, the Kerala State Co-operative Agricultural and Rural Development Bank Limited, Primary Co-operative Agricultural and Rural Development Bank, Urban Co-operative Societies, Agricultural Improvement Co-operative Societies, Employees Credit Societies, Rural Co-operative Societies, Primary Housing Cooperative Societies and Kerala State Housing Federation. 38. Article 19 of the Constitution of India protects certain rights regarding freedom of speech, etc. By virtue of the Constitution (97th Amendment) Act, 2011 under Article 19(1)(c) , the words co-operative societies are added. Article 19(1)(c) reads as under: 19. Protection of certain rights regarding freedom of speech, etc. - (1) All citizens shall have the right - *** (c) to form associations or unions or cooperative societies. By virtue of the Constitution (97th Amendment) Act, 2011 under Article 19(1)(c) , the words co-operative societies are added. Article 19(1)(c) reads as under: 19. Protection of certain rights regarding freedom of speech, etc. - (1) All citizens shall have the right - *** (c) to form associations or unions or cooperative societies. Article 19(1)(c) therefore guarantees the freedom to form associations, unions and co-operative societies. The right to form a co-operative society is, therefore, raised to the level of a fundamental right, guaranteed under the Constitution of India . 39. The newly inserted Article 43-B of the Constitution provides that the State shall endeavour to promote voluntary formation, autonomous functioning, democratic control and professional management of co-operative societies. By virtue of the above said amendment, Part IXB was also inserted containing Articles 243- ZH to 243-ZT. The co-operative societies are, however, not treated as units of self government, like Panchayats and Municipalities. It has been held so by the Hon'ble Apex Court in Thalappalam Service Co-operative Bank Limited and others (supra). 40. The Apex Court in the judgment in Association for Democratic Reforms and another (Electoral Bond Scheme) (supra) has held that it is now a settled position of law that a statute can be challenged on the ground that it is manifestly arbitrary and that the courts while testing the validity of a law on the ground of manifest arbitrariness have to determine if the statute is capricious, irrational and without adequate determining principle, or something which is excessive and disproportionate. 41. After the Constitution (97th Amendment) Act, 2011 which came into with effect from 15.02.2012, the promotion of Co-operative Societies is a Directive Principle of State policy. Article 43-B of the Constitution mandates that the State shall endeavour to promote voluntary promotion, autonomous functioning, democratic control and professional management of Co- operative Societies. Promotion of Co-operative Societies being a directive principle now, any steps taken by the State shall ensure and satisfy the requirements contained in Article 43-B. Autonomous functioning and democratic control are key words used in Article 43-B. Autonomous functioning means the ability of a person or body of persons to perform independently the various tasks required by the person / body of persons. Autonomous functioning contemplates members of the Society complete essential tasks of their position without direct supervision or oversight. 42. Autonomous functioning contemplates members of the Society complete essential tasks of their position without direct supervision or oversight. 42. The statements of objects and reasons of the 97th amendment of the Constitution states that a strong need has been felt for amending the Constitution so as to keep the cooperatives free from unnecessary outside interferences and also to ensure their autonomous organisational set up and their democratic functioning. 43. Part IX-B has been inserted by the Constitution (97th Amendment) Act, 2011. Article 243-ZI relates to incorporation of Co-operative Societies. Article 243-ZI provides that the Legislature of a State may, by law, make provisions with respect to the incorporation, regulation and winding up of Cooperative Societies based on the principles of voluntary formation, democratic member-control, member- economic participation and autonomous functioning. Article 243-ZK provides for election of members to the Board of Co-operative Societies. Article 243-ZK(1) provides that notwithstanding anything contained in any law made by the Legislature of the State, the election of a Board shall be conducted before the expiry of the term of the Board so as to ensure that newly elected members of the Board assume office immediately on the expiry of the term of the office of members of the outgoing Board. Article 243-ZK(2) provides that the superintendence, direction and control of the preparation of electoral rolls for, and the conduct of all elections to a Co-operative Society shall vest in such an authority or Body, as may be provided by the Legislature of a State, by law. The proviso to Article 243-ZK empowers the legislatures of State to provide for the procedure and guidelines for the conduct of such elections. 44. It is the mandate of Article 243-ZI that any law made by the Legislature of a State for incorporation, regulation and winding up of Co- operative Societies should be based on the principles of voluntary formation, democratic member-control, member-economic participation and autonomous functioning. Though Article 243- ZK empowers Legislatures of States to constitute an Authority or Body for the conduct of elections to the Co-operative Societies, the Article provides that law that may be made by the Legislature for conduct of elections may provide for the procedure and guidelines for the conduct of such elections. The Constitution of India requires the State only to prescribe procedure and guidelines for the conduct of such election. 45. The Constitution of India requires the State only to prescribe procedure and guidelines for the conduct of such election. 45. The words “autonomous functioning” appearing in Article 243-ZI would necessarily mean that the State intervention in the functioning of Co-operative Societies should be minimal. The powers granted under Article 243-ZI to make laws is confined to incorporation, regulation and winding up of Co-operative Societies. Prescribing arbitrary eligibility conditions for participating in election to the Managing Committee of Co- operative Societies would amount to interference with the autonomous functioning of Co-operative Societies. 46. Electing a Managing Committee to administer the Society is one of the important functions which is to be discharged by the members of the Society. The law assumes that members of the Society are competent to decide who among the members of the Society would be able to manage the affairs of the Society most effectively. When the State puts conditions of eligibility on members of the Society to be being elected to the Managing Committee, such conditions should be conducive to the autonomous functioning of the Society based on democratic control as contemplated by Article 43- B. 47. In the judgment in Pravinsinh Indrasinh Mahida v. State of Gujarat [2021 SCC Online Guj 1293], a Division Bench of the Hon'ble High Court of Gujarat held that a legislation can be discriminatory when it does not disclose any object which could be said to be reasonable or in public interest, and secondly, the differentiation, which is sought to be made, has no nexus with the object sought to be achieved The object and reason behind the amendment as is evident from the pleading and arguments of the respondents, is to save vested interest in the management of the Co-operative Societies. 48. The Hon'ble High Court of Gujarat held in Pravinsinh Indrasinh Mahida (supra) that in order to strike down a delegated legislation as arbitrary, it has to be established that the same is manifestly arbitrary. The expression “arbitrary” means in an unreasonable manner, as fixed or done capriciously or at pleasure, without adequate determining principle, not founded in the nature of things, non rational, not done or acting according to reason or judgment, depending on the will alone. 49. The expression “arbitrary” means in an unreasonable manner, as fixed or done capriciously or at pleasure, without adequate determining principle, not founded in the nature of things, non rational, not done or acting according to reason or judgment, depending on the will alone. 49. The restraint imposed by the addition of Section 28(2A) on members being elected to the Committee again after three consecutive terms, presumably is intended to avert any vested interest being developed among the Members of the Committee due to long tenure in office. It is true that on the Executive side of the State, tenure restrictions are prescribed by executive orders and administrative instructions by which Government Servants are restrained from continuing in one territorial area for more than the tenures fixed. Such tenure restrictions are fixed in order to avert possibility of developing vested interest in any territorial area. However, members of Co-operative Societies who are elected to hold positions in the Managing Committee cannot be treated at par with Government servants. Members of the Managing Committee of a Co-operative Society holds a position where they are imposed with the responsibility of taking important decisions in the administration of the Society. Longer experience gained by such persons would only be beneficial to the Co-operative Society and its members. 50. Co-operative Societies being institutions functioning autonomously, such anxieties of vested interest should be best left to be confronted by the General body of Members itself. If the General body of a Society feels that long continuance of Members in the Managing Committee would adversely affect the management and affairs of the Society, the General body can incorporate such conditions in the bye-laws of the Society. When State imposes such restraint, it would indeed amount to interference with the autonomy of the Societies and interference with the right of the General body of a Society to elect best among its Members to the Managing Committee. 51. The Societies are expected to function in a democratic manner. The term “democratic control” appearing in Article 43-B does not mean that State shall control the Societies on the basis of majority opinion of the Legislature or of any other external Bodies. The term “democratic control” in Article 43-B contemplates that Societies should be functioning in a democratic manner and the State shall strive to ensure that the Societies are run in a democratic manner. The term “democratic control” in Article 43-B contemplates that Societies should be functioning in a democratic manner and the State shall strive to ensure that the Societies are run in a democratic manner. When the Legislature makes arbitrary rules regulating the conditions and qualifications for being elected to the Managing Committee of a Co- operative Society, that would indeed be an affront to the right of the members of the Society to run the Society in a democratic manner. It is to be noted that the credentials of Co-operative Societies, which are mostly functioning in rural and semi urban areas in Kerala, depend on the trustworthiness of the Members of the Managing Committee of the Societies. 52. In Krishnamoorthy v. Sivakumar and others [ (2015) 3 SCC 467 ], the Apex Court quoted the judgment of Privy Council in King Emperor v. Sibnath Banerji and othes [ AIR 1945 PC 156 ] and held that freedom in the exercise of the judgment which engulfs a voter's right, a free choice, in selecting the candidate whom he believes to be best fitted to represent the Constituency, has to be given due weightage. The Hon'ble Apex Court in Jyoti Basu and others v. Debi Ghosal and others [ (1982) 1 SCC 691 ] held as follows: 7. The nature of the right to elect, the right to be elected and the right to dispute an election and the scheme of the Constitutional and statutory provisions in relation to these rights have been explained by the Court in N.P. Ponnuswami v. Returning Officer, Namakkal Constituency and Jagan Nath v. Jaswant Singh. We proceed to state what we have gleaned from what has been said, so much as necessary for this case. 8. A right to elect, fundamental though it is to democracy, is, anomalously enough, neither a fundamental right nor a Common Law Right. It is pure and simple, a statutory right. So is the right to be elected. So is the right to dispute an election. Outside of statute, there is no right to elect, no right to be elected and no right to dispute an election. Statutory creations they are, and therefore, subject to statutory limitation. An Election petition is not an action at Common Law, nor in equity. So is the right to be elected. So is the right to dispute an election. Outside of statute, there is no right to elect, no right to be elected and no right to dispute an election. Statutory creations they are, and therefore, subject to statutory limitation. An Election petition is not an action at Common Law, nor in equity. It is a statutory proceeding to which neither the Common Law nor the principles of Equity apply but only those rules which the statute makes and applies. It is a special jurisdiction, and a special jurisdiction has always to be exercised in accordance with the statute creating it. Concepts familiar to Common Law and Equity must remain strangers to Election Law unless statutorily embodied. The afore view has been reiterated by the Apex Court in the judgment in Arikala Narasa Reddy v. Venkata Ram Reddy Reddygari and another [ (2014) 5 SCC 312 ]. 53. It may be noted that the cases where it has been held that right to be elected is not a statutory or common law right are cases relating to election to bodies which are creature of statutes. As far as private bodies / organisations are concerned, the right to contest in elections will be governed by their own rules. Even if functioning of such bodies are regulated by the Government through statutes, the State cannot interfere with the democratic functioning of such bodies imposing arbitrary conditions for eligibility to contest in elections. 54. There cannot be a legal assumption or invariable rule that members being elected to the Managing Committee of a Co-operative Society would develop vested interest and they will be incompetent to have their say in the management and affairs of a Co-operative Society. Such restraint is not existing in any other democratic institutions like Parliament / State Legislatures or even in Local Self Government Institutions governed by Panchayat Raj Act. There cannot be a blanket assumption that members being elected to Managing Committee repeatedly and continuously will act to the detriment of the Societies. Even if there is likelihood of developing vested interest, being a democratically functioning institution, it is for the Members / General body of a Co- operative Society to address such issues. 55. There cannot be a blanket assumption that members being elected to Managing Committee repeatedly and continuously will act to the detriment of the Societies. Even if there is likelihood of developing vested interest, being a democratically functioning institution, it is for the Members / General body of a Co- operative Society to address such issues. 55. Furthermore, the restraint on a Member of the Committee of the Society being elected consecutively for the fourth term is imposed only on Credit Societies as defined under the Explanation given below Section 28(2A). If a Member being elected to the Managing Committee of any other Society for the fourth consecutive term, will not develop vested interest, then there need not be a distinction between Credit Societies and other Societies. The State is constitutionally bound to endeavour to promote all Cooperative Societies irrespective of whether such Societies are Credit Societies or not. Section 28(2A) is therefore highly arbitrary and grossly discriminatory. 56. Section 28(2A) added to the Kerala Co- operative Societies Act, 1969 by the Act 9 of 2024 therefore is irrational and manifestly arbitrary. Section 28(A) cannot stand the scrutiny of Article 14 of the Constitution of India . Section 28(2A) is therefore declared as illegal and unconstitutional. 11. It is in that background, the intra court1 appeals have been preferred on behalf of the State. 12. Sri. K. Gopalakrishna kurup, learned Advocate General along with Sri. T.K Vipindas, Senior Government Pleader and Sri. P.P Thajudeen, Special Government Pleader raised the following submissions: (i) No doubt, Article 19(1)(c) of the Constitution of India provided the autonomy to the Co-operative Society but that do not relate to the elections giving innumerable chances to a person from contesting as a member of the Society as the aforementioned amendment applies only to the credit Societies who are dealing with the disbursement of loans. (ii) The learned Single Judge, gravely erred in concluding that the unfettered right to contest the election to the committee of a Credit Societies without any term restrictions was sine qua non for autonomy and democratic control of the Society. (iii) The learned Single Judge overlooked the common feature of a Credit Society that they are the Society raising the funds and giving loans to the members for all kind of activities to be undertaken by the Societies which are mainly handling cash of the depositors of the Society concerned. (iii) The learned Single Judge overlooked the common feature of a Credit Society that they are the Society raising the funds and giving loans to the members for all kind of activities to be undertaken by the Societies which are mainly handling cash of the depositors of the Society concerned. There was no hostile discrimination by causing an amendment much less violation of Article 14 of the Constitution of India . (iv) The amendment to Section 28 (2A) did not impinge upon any fundamental rights guaranteed under Part III of the Constitution of India . It is trite and settled law that a legislation is manifestly arbitrary if it is capricious, irrational and/or without adequate determined principle. There is nothing excessive or disproportionate in the mandate of Section 28 (2A) rather the amendment conforms to the norms which are rational and guided by public interest, for, the practice of the same person holding the office committee for a number of period in the past had adversely affected the working of a society in as much as that numerous cases of surcharge under Section 68 of the Co-operative Societies Act have been initiated much less registration of the crime cases and in few cases also involved money laundering and Enforcement Director has also taken cognizance. (v) PART IX-B of the Constitution is applicable only to the multi state co-operative Societies and therefore Article 243- ZI emphatically relied upon by the Single Judge giving autonomy to the Society would not mean that the legislature is denuded from causing the amendment, for on plain and simple reading of the Article 243-ZA the superintendence, direction and control of the preparation of electoral rolls for, and the conduct of, all election to the co-operative Society is always vested with the authority or body as provided by the legislature of the State. (vi) Thus by causing an amendment restricting the term of the member from contesting the election is totally inconsance with the provisions of Article 243-ZK. In support of the contentions relied upon the judgment of the Bombay High Court in Shivaji Ramachandra More, Kolhapur and others v. State of Maharashtra ( 1988 Mh.L.J 856 ) and of the Supreme Court in Javed and Others v. State of Haryana and Others ( 2003 (8) SCC 369 ) pertaining to the amendment caused in the Haryana Panchayat Raj Act. 13. 13. On the contrary Mr.George Poonthottam, learned senior counsel and other counsels supported the findings of the Single Bench and controverted the argument of the learned Advocate General by raising the following submissions: (i) Section 28 of the Kerala Co-operative Societies Act stipulates the appointment of committee for a period of five years in accordance with the bye-laws and entrust the management of the affairs of the society to such committee. (ii) By way of an amendment, restriction has been imposed on members of the committee to contest the elections for more than three consecutive terms; such is unreasonable. (iii) Co-operative Society is functioning in a democratic, professional, autonomous and economically sound manner. There is no rational behind the restrictions imposed upon the members of the Committee of the Credit Society to contest the elections. (iv) The amendment does not satisfy the reasonableness much less not based upon an intelligible differentia. Legislation is entirely incompatible and inconsistent with the co-operative principles which mandate ensuring democratic member control, autonomy and independence. In support of the contentions, relied upon judgment of the Gujarat High Court in Pravinsinh Indrasinh Mahida v. State of Gujarat (2021 SCC online Guj 1293). 80. Article 14 has two clear facets which are invalid. One is over classification and the other is under classification, which is otherwise, over inclusiveness or under inclusiveness. The judicial review of over classification should be done very strictly. In the cases of under classification when the complaint is either by those who are left out or those who are in i.e. that the statute has roped him in, but a similarly situated person has been left out, it would be under inclusion. It is to say that you ought to have brought him in to make the classification reasonable. It is in such cases that the Courts have said that who should be brought in, should be left to the wisdom of the legislature because it is essentially a stage where there should be an element of practicality. Therefore, the cases of under inclusion can be reviewed in a little liberal manner. The under inclusion argument should not very readily be accepted by the Court because the stage could be experimental. For instance, if the argument is in context with Section 74C that some other category of society has been left out, the Court would say that it is under inclusion. The under inclusion argument should not very readily be accepted by the Court because the stage could be experimental. For instance, if the argument is in context with Section 74C that some other category of society has been left out, the Court would say that it is under inclusion. The legislature does not have to bring in everybody to make it reasonable. The case on hand is one of active exclusion. Had the Sugar societies been left out or the voters been excluded in Section 74C at the first instance and they came in to say that the State ought to have included us, the test would have been very strict, not that it would be impervious to review. The Court would be justified in not entertaining such complaint saying that the State should be given some freedom whom to include or whom not to include. The Sugar societies have come at the stage where they are excluded. They are saying that having treated us as one, you cannot exclude us now in an arbitrary manner. This is not exclusion or inclusion at the threshold or the first stage. This is active positive leaving out single legislation single category legislation constantly eliminating where the principles do not apply of that of under inclusion. (v) The legislature does not have to bring in everybody to make it reasonable. It was a case where certain Society were left out, for, the voters were excluded, it was found that the legislature cannot exclude one set, which would be wholly arbitrary. (vi) Article 43B, PART IV, Directive Principles of State Policy envisages that the State shall endevour to promote voluntary formation, autonomous functioning, democratic control and professional management of co-operative societies, which has been rightly applied by the learned Single Bench in striking down the vires of the amendment under challenge. 14. Sri. K. Gopalakrishna Kurup, learned Advocate General, in rebuttal relied upon the judgment of the Supreme Court in Union of India v. Rajendra N.Shah and another (2021 SCC online SC 274) wherein the vires of the constitution 97 th amendment Act, 2011 which introduced Part IX B under the Heading 'Co-operative Societies' was held to be validly incorporated, it will not impact the amendment which have been made under Article 19(1)(c) of the Constitution of India . 15. We have heard the learned counsel for the parties and appraised the paper book. 15. We have heard the learned counsel for the parties and appraised the paper book. The credit Societies in the State of Kerala as mentioned above are dealing with collecting the money from the depositors and also extending the facility of loan to the needy persons subject to the adjudication of certain requirements which is in common parlance for execution of mortgage deed or deposits of the title deeds or any movable or tangible property. There has been a spate of litigation at the instance of the depositors seeking return of their money on maturity of the fixed deposits for the Credit Societies, as element of interest in the credit Societies is 1% more than the Nationalized banks but despite in request, the Society has not come forward entailing into various litigations in this Court which has been contested and while dealing with such litigation this Court has also been apprised that various criminal cases have been registered against the erstwhile members who had been holding the coveted positions in the Society for numerous years having been elected in each and every election and indulging into disbursement of the loan without complying with the statutory provisions or violating the bye-laws of the Society resulting into initiation of surcharge proceedings as envisaged under Section 68 of the Co-operative Societies Act. The same reads as under: 68. Surcharge:- (1) If in the course of an audit, inquiry, inspection or the winding up of a society, it is found that any person, who is or was entrusted with the organisation or management of such society or who is or has at any time been an officer or an employee of the society, has made any payment contrary to the Act and the rules or the bye-laws, or has caused to any loss or damage in the assets of the society by breach of trust or wilful negligence or mismanagement or has misappropriated or fraudulently retained any money or other property belonging to such society or has destroyed or caused the destruction of the records, the Registrar may, of his own motion or on the application of the committee, liquidator or any creditor, inquire himself or direct any person authorised by him by an order in writing in this behalf, to inquire into the conduct of such person. (2) Where an inquiry is made under sub-section (1), the Registrar may, after giving the person concerned an opportunity of being heard, by order in writing, require him to repay or restore the money or other property or any part thereof, with interest at such rate, or to pay contribution and costs or compensation to such extent, as the Registrar may consider just and equitable]. (3) Where the money, property, interest, cost or compensation is not repaid or restored as per sub- section (2), the Registrar shall take urgent steps to recover such amounts from the concerned persons as arrears of public revenue due on land as specified in Section 79 of the Act.] 16. In those proceedings, it was also disclosed that crime cases have been registered much less Enforcement Directorate has also, in various cases, taken note as the misappropriation is running at crores of rupees. In order to have checks and balances, as per the provisions of Article 243-ZK, legislature is not prevented from prescribing a procedure and guidelines for the conduct of the elections. 17. In order to prevent the misuse of the power the legislature in the wisdom caused an amendment by introduction of sub Section 2A of Section 28 Act barring a member of Society to contest the election if he or she had been the member of the Society for three terms with an aim to eliminate unhealthy practice which is resultant of abnormal long continuance of a particular person in the same office. We cannot remain unmindful of the fact that the credit Societies are dealing with the money matters with the members including the nominated members who are not having voting rights. The practice of the person holding the same post in the managing committee for a longer period has in the past adversely affected the working of the Society. It is in that background, a reasonable restriction disqualifying the members from contesting the election who have been elected member of Society for more than three years. On the basis of some enquiry, it is a matter of record that the same very managing committee members an office bearers are continuing in the administration for a pretty long period in the committee and large scale irregularities have been committed. 18. On the basis of some enquiry, it is a matter of record that the same very managing committee members an office bearers are continuing in the administration for a pretty long period in the committee and large scale irregularities have been committed. 18. In the State nearly more than sixteen thousand (16000) Societies are functioning under the administrative control of the Co-operative Registrars and more than five thousand (5000) Societies under the functional Registrars. Since the existence of credit Society is inevitable for the very existence of our economy of the State, every steps to eradicate unhealthy practices are to be eliminated through legislation. 19. In Shivaji Ramachandra More (supra) the controversy involved before the Bombay High Court was on account of promulgation of an ordinance prohibiting the person who had already served for two terms or more or for 6 years from continuing as members and contesting election to various bodies of the Universities. The gist of the findings recorded in paragraphs 5,6,7,8 and 11 disclosed that the ordinance is not prohibitive, arbitrary or discriminatory on the premise that there is no fundamental right in any person to stand as a candidate for election to Senate or Executive Council. 20. Right to contest an election is a statutory right and not a common law right. It is a special right created by the statute and can only be exercised on the conditions laid down by the statute itself. Therefore, such act of the legislature much less the purpose of the legislature in passing a statute, is beyond the scrutiny of the Courts. It cannot said to be discriminatory. Paragraph 11 to 13 of the judgments reads thus: 11. The challenge based on Article 14 of the Constitution i.e. that different terms are laid down for different categories of the members and therefore, the provision is discriminatory, is also without any substance. Whatever may be the term of office the enactment uniformly lays down that no person will hold such an office and be eligible for being elected, if he is holding the office for two terms or more and to avoid any uncertainty in the matter, an outer limit is also laid down, that is, for a period of 6 years in aggregate. This is nothing but a logical extension of the terms of office laid down by the Act itself. This is nothing but a logical extension of the terms of office laid down by the Act itself. Therefore, it cannot be said that it is discriminatory. Persons elected from the different constituencies and to different bodies belong to different classes and therefore, there is no discrimination between the persons belonging to same class nor unequals are treated equally. Therefore we do not find any substance in the said contention also. 12. Once it is held that a right to stand as a candidate is not a civil right but is a creature of a statute or a special law, and must therefore, be subjected to the limitation imposed by it, and there is no fundamental right to stand for election as a candidate, the challenges raised before us must stand negatived. 13. However, it was contended by Shri Agrawal that there is absolute prohibition to contest the election after the requisite period is over. In analogous law, such as Maharashtra Co-operative Societies Act, Section 73A(5), a person is allowed to contest the election after a gap of one term. At least such a provision should have been made in the present legislation. This is a matter of policy with which we are not concerned. In this context a reference could usefully be made to the following observations of the Supreme Court in, Maharashtra State Board of Secondary and Higher Secondary Education v. Paritosh Bhupesh Kurmarshetha. "16............... The Court cannot sit in judgment over the wisdom of the policy evolved by the legislature and the subordinate regulation making body. It may be a wise policy which will fully effectuate the purpose of the enactment or it may be lacking in effectiveness and hence calling for revision and improvement. But any drawbacks in the policy incorporated in a rule or regulation will not render it ultra vires and the court cannot strike it down on t he ground that in its opinion, it is not a wise or prudent policy, but is even a foolish one, and that it will not really serve to effectuate the purposes of the Act. The legislature and its delegate are the sole repositories of the power to decide what policy should be pursued in relation to matters covered by the Act and there is no scope for interference by the court unless the particular provision impugned before it can be said to suffer from any legal infirmity, in the sense of its being wholly beyond the scope of the regulation making power or its being inconsistent with any of the provisions of the parent enactment or in violation of any of the limitations imposed by the Constitution......" Further an academic institution like University cannot be equated with a co-operative society. Further forum where such a grievance could be raised is the Legislature and not the Court. 21. Similarly, as noticed above, the State of Haryana had also caused an amendment of Section 175 of the Haryana Panchayat Raj Act disqualifying the members to contest for the member of the Panchayat, if he or she had more than two living children. The said amendment was also challenged on various grounds like discrimination, powers of the legislation, arbitrariness etc., and in paragraphs 21 to 25, the Hon'ble Supreme Court in the judgment Javed (supra) held as under: 21. Before testing the validity of the impugned legislation from the viewpoint of Articles 21 and 25, in the light of the submissions made, we take up first the more basic issue - Whether it is at all permissible to test the validity of a law which enacts a disqualification operating in the field of elections on the touchstone of violation of fundamental rights? 22. Right to contest an election is neither a fundamental right nor a common law right. It is a right conferred by a Statute. At the most, in view of Part IX having been added in the Constitution, a right to contest election for an office in Panchayat may be said to be a constitutional right __ a right originating in Constitution and given shape by statute. But even so it cannot be equated with a fundamental right. There is nothing wrong in the same Statute which confers the right to contest an election also to provide for the necessary qualifications without which a person cannot offer his candidature for an elective office and also to provide for disqualifications which would disable a person from contesting for, or holding, an elective statutory office. 23. There is nothing wrong in the same Statute which confers the right to contest an election also to provide for the necessary qualifications without which a person cannot offer his candidature for an elective office and also to provide for disqualifications which would disable a person from contesting for, or holding, an elective statutory office. 23. Reiterating the law laid down in N.P. Ponnuswami Vs. Returning Officer, Namakkal Constituency (1952) SCR 218 , and Jagan Nath Vs. Jaswant Singh and Ors., 1954 SCR 892 , this Court held in Jyoti Basu and Ors. Vs. Debi Ghosal and Ors., (1982) (1) SCC 691 , - "A right to elect, fundamental though it is to democracy, is, anomalously enough, neither a fundamental right nor a common law right. It is pure and simple, a statutory right. So is the right to be elected. So is the right to dispute an election. Outside of statute, there is no right to elect, no right to be elected and no right to dispute an election. Statutory creations they are, and therefore, subject to statutory limitation." 24.In Jumuna Prasad Mukhariya and Ors. Vs. Lachhi Ram and Ors., (1955) 1 SCR 608 , a candidate at the election made a systematic appeal to voters of a particular caste to vote for him on the basis of his caste through publishing and circulating leaflets. Sections 123(5) and 124(5) of the Representation of the People Act, 1951, were challenged as ultra vires of Article 19(1)(a) of the Constitution, submitting that the provisions of Representation of the People Act interfered with a citizen's fundamental right to freedom of speech. Repelling the contention, the Constitution Bench held that these laws do not stop a man from speaking. They merely provide conditions which must be observed if he wants to enter Parliament. The right to stand as a candidate and contest an election is not a common law right; it is a special right created by statute and can only be exercised on the conditions laid down by the statute. The Fundamental Rights Chapter has no bearing on a right like this created by statute. The appellants have no fundamental right to be elected and if they want to be elected they must observe the rules. If they prefer to exercise their right of free speech outside these rules, the impugned sections do not stop them. In Sakhawat Ali Vs. The Fundamental Rights Chapter has no bearing on a right like this created by statute. The appellants have no fundamental right to be elected and if they want to be elected they must observe the rules. If they prefer to exercise their right of free speech outside these rules, the impugned sections do not stop them. In Sakhawat Ali Vs. The State of Orissa, (1955) 1 SCR 1004 , the appellant's nomination paper for election as a councillor of the Municipality was rejected on the ground that he was employed as a legal practitioner against the Municipality which was a disqualification under the relevant Municipality Act. It was contended that the disqualification prescribed violated the appellant's fundamental rights guaranteed under Article 14 and 19(1)(g) of the Constitution. The Constitution Bench held that the impugned provision has a public purpose behind it, i.e., the purity of public life which would be thwarted where there was a conflict between interest and duty. The Constitution Bench further held that the right of the appellant to practise the profession of law guaranteed by Article 19(1)(g) cannot be said to have been violated because in laying down the disqualification the Municipal Act does not prevent him from practising his profession of law; it only lays down that if he wants to stand as a candidate for election he shall not either be employed as a paid legal practitioner on behalf of the Municipality or act as a legal practitioner against the Municipality. There is no fundamental right in any person to stand as a candidate for election to the Municipality. The only fundamental right which is guaranteed is that of practising any profession or carrying on any occupation, trade or business. The impugned disqualification does not violate the latter right. Primarily no fundamental right is violated and even assuming that it be taken as a restriction on his right to practise his profession of law, such restriction would be liable to be upheld being reasonable and imposed in the interests of general public for the preservation of purity in public life. 25.In our view, disqualification on the right to contest an election by having more than two living children does not contravene any fundamental right nor does it cross the limits of reasonability. Rather it is a disqualification conceptually devised in national interest. 22. 25.In our view, disqualification on the right to contest an election by having more than two living children does not contravene any fundamental right nor does it cross the limits of reasonability. Rather it is a disqualification conceptually devised in national interest. 22. The pith and substance of the findings extracted above, leaves no manner of doubt that the right to stand as a candidate and contest election is not a common law right but a special right created by a statute and can be only exercised on the conditions laid down by the statute. It is not a fundamental right as observed by the Single Bench much less to be violative of directive principles as per Article 43B of the Constitution of India , PART IV, Directive Principles of State Policy. These two factors have not been pondered while striking down the amendment in the judgment under challenge. The whole focus had been only on the autonomy of the Society. Meaning thereby, the Society, in view of the autonomy granted will be like a plant 'touch me not' which is not the main purpose and object of the introduction of amendment of the constitution of India. No reasoning or rational has been assigned while rendering a finding in paragraph 55 that the election of the managing committee of any Society for the 4 th consecutive term will not develop any vested right. In case, the findings in the said judgment under challenge is permitted to sustain, it will render unfettered and unbridled powers to the member of the Society to indulge into misappropriation and will be against the principles of administrative law. The ratio of decidendi culled out in the judgments cited on behalf of the respondents was basically on account of the exclusion of certain diary and milk Co-operative Societies from the provisions of the Andhrapradesh Co-operative Society and therefore definitely would be violative of the Article 14 of the constitution of India. The right to contest, for the sake of repetition is not a fundamental right but right from the statute. As an upshot of findings, we set aside the findings of the learned Single Judge from paragraphs 36 to 56 viz-a-viz striking down the provisions of Section 28(2A) of the Act. Consequently, all Writ appeals are allowed.