ORDER : SURAJ GOVINDARAJ, J. 1. The Petitioners are before this Court seeking for the following reliefs: i. Issue a writ of appropriate nature to declare that Section 12(5)(6) the Karnataka Co-operative Societies Act in ultra vires and in violation of Article 19(1)(G) and Article 43-B of the Constitution of India. ii. Issue any writ of certiorari quashing the impugned directions bearing Sani No.43:RSR:GRN:12(5):PR:2023-24 dated 29.11.2023 passed by the Respondent no.4 vide Annexure-A and iii. Permit the Respondent No.5 society to continue to function in its existing area of operation as per its Bye-laws; and iv. Grant such other relief as may be deemed fit to grant under the circumstances of the case in the interest of equity and justice. 2. Learned counsel for the Petitioner at the outset submits that he would not press for prayer (i) above, as such prayer (i) is deleted. 3. The Petitioners claim to be directors of Respondent No.5-Primary Agriculture Credit Co-operative Society (hereinafter for brevity referred to as a “ PACS ”) which has been registered under the provisions of the Karnataka Co-operative Societies Act, 1959 (hereinafter for brevity referred to as “ KCS Act ”). The Society is engaged in the business of acceptance of various types of deposits, providing credit facilities to its members, supplying of fertilisers, manure, agriculture implements, ration items, etc. In terms of the by-laws of the Society, the Society only functions and carries on business with its members, a non-member cannot deal with the Society. 4. Respondent No.2-the Registrar of Co-operative Societies (hereinafter for brevity referred to as “the Registrar ”) issued a circular on 12.05.2017 directing the Gram Panchayat to take steps to form a separate PACS in each of the Gram Panchayats where there is no PACS, on the basis of the said circular the Additional Registrar of Co-operative Societies, in a meeting held on 03.08.2023 decided to form a new PSCS for Bechanahalli Gram Panchayat, in pursuance of which the Assistant Registrar of Co-operative Societies (hereinafter for brevity referred to as “ ARCS ”) issued a direction on 29.11.2023, under Sub-section (5) of Section 12 of the KCS Act directing the Society to delete Bechanahalli Gram Panchayat from its area of operation within 15 days so as to enable the formation of a new PACS in Bechanahalli. 5. 5. The Society submitted a representation on 28.12.2023 stating that in order to comply with the directions, the Society would have to call for a Special General Meeting which would take some time and therefore requested the ARCS not to implement the direction until such time. 6. In the meanwhile, the villagers of Bechanahalli and certain other members of the Society had addressed a letter on 29.12.2023 to the ARCS, requesting the ARCS not to implement the directions and not to form a new PACS in Bechanahalli which has also not been considered by Respondent No.4. It is in that background, that the Petitioners are before this Court seeking for the aforesaid relief. 7. Sri.Jayakumar S. Patil, learned Senior Counsel appearing for the Petitioner would submits that; 7.1. The impugned direction dated 29.11.2023 is stated to have been issued in pursuance of a circular dated 12.05.2017 issued by the Registrar, thereafter the Registrars having kept quiet for seven years without implementing the circular dated 12.05.2017, the question of now issuing a direction under Sub-section (5) of Section 12 of the KCS Act would not arise. 7.2. If the impugned directions are implemented, the Society would be left in a lurch which could result in a collapse of the Society, the livelihood of several employees employed by the Society would be endangered, the area of operation of the Society cannot be pruned by an executive direction, the Society operating in several gram panchayats is entitled to do so, merely because in each grand panchayat a PACS is required to be established, the same would not require the Society to delete Bechanahalli Gram Panchayat from its area of operation. 7.3. The Petitioners, as also the Society, have no objection for any new society to be established in Bechanahalli Gram Panchayat. If at all, the residents of Bechanahalli want to establish a separate PACS, they will have to comply with the applicable laws. If at all, the members of the Respondent No.5-Society wish to resign and/or terminate their membership from the Society, they could do so upon making payment of the due amounts and closure of all formalities, thereafter they could always become members of the new Society, as and when formed. 7.4. The Petitioners as also Respondent No.5-Society have no objection for formation of a new society. 7.5. 7.4. The Petitioners as also Respondent No.5-Society have no objection for formation of a new society. 7.5. Directions under Sub-section (5) of Section 12 of the KCS Act can only be issued as regards amendment to the bylaws, if so required to be in accordance with the KCS Act and KCS Rules. There is no power vested with the Registrar or any officers subordinate to him, including the ARCS, to direct the reduction of the area of operation of the Society. There cannot be a direction to relinquish a grama panchayat from the area of operation by the ARCS, the same is arbitrary, unscientific, illegal, without authority of law. 7.6. His further submission is that the principles of natural justice have not been followed, inasmuch as the Society has not been given any notice before the issuance of such instructions. The issuance of instructions of sub-section (5) of Section 12 of the KCS Act to remove a particular grama panchayat from its area of operation is an administrative overreach by the Government seeking to deprive the Society of its authority and legal right to carry on the business. 7.7. His submission is also that in pursuance of the 97 th Amendment to the Constitution of India by virtue of which Article 43-B has been introduced, there is autonomy in the working of the Society by issuance of such administrative direction to delete a particular gram panchayat from the area of operation, the said autonomy is breached. 7.8. By way of the Amendment in the year 2013, Section 14(A) of the KCS Act has been deleted. Therefore, the Registrar now does not have any power for the reorganisation of co-operative societies. 7.9. Any division or reorganisation of Society can only be done voluntarily under Section 14 of the KCS Act. There cannot be administrative directions issued for such reorganisation or division. Fragmentation of a Co-operative Society is not in the interest of the general Society, the same would have an adverse impact on the working of the Co-operative Society. 8. Sri.T.P.Sandesh., learned counsel appearing for Respondent No.5-Society would reiterate the submission of Sri.Jayakumar S. Patil, learned Senior counsel and submitted that; 8.1. Respondent No.5 cannot be directed to delete any panchayats from its area of operation. 8. Sri.T.P.Sandesh., learned counsel appearing for Respondent No.5-Society would reiterate the submission of Sri.Jayakumar S. Patil, learned Senior counsel and submitted that; 8.1. Respondent No.5 cannot be directed to delete any panchayats from its area of operation. There is no embargo on a society operating in different grama panchayats, it is for that reason that under Section 28(A), the number of directors has been fixed on the basis of the area of operation, namely a portion of the taluka, the entire taluka, portion of the district, entire district, etc. 8.2. Thus, he submits that when a PACS can operate in the entire taluka, a taluka comprising various grama panchayats, there cannot be an embargo imposed by an executive direction to restrict the area of operation of a PACS to a particular grama panchayat alone. Merely, because the State wants to have a PACS in every Gram Panchayat would not result in there being only one PACS for each Gram Panchayat, such a restriction would be violative of Article 43B as also Article 19(1)(G) of the Constitution. 8.3. Insofar as the Respondent No.5-Society is concerned, the Society has NO OBJECTION for a new society to be formed in Bechanahalli having its area of operation as Bechanahalli Gram Panchayat or otherwise. The only objection of the Petitioners and the Society is as regards the removal of Bechanahalli from the area of operation of the Respondent No.5- Socitey. So long as the said Bechanahalli Gram Panchayat is not deleted from the area of operation, Respondent No.5-Society will not have any objection for creation of another PACS having its area of operation as Bechanahalli Gram Panchayat. 8.4. His further submission is also that if any of the members of Respondent No.5-Society wish to resign or terminate their membership from Respondent No.5-Society they would be free to do so. In terms of the applicable bylaws, they would only have to clear all the pending dues and complete the formalities of such termination of membership. Thereafter, they would be free to Join any other PACS including the one that may be formed in Bechanahalli. 8.5. In brief, his submissions is that Respondent No.5-Society can operate in multiple gram panchayats. In terms of the applicable bylaws, they would only have to clear all the pending dues and complete the formalities of such termination of membership. Thereafter, they would be free to Join any other PACS including the one that may be formed in Bechanahalli. 8.5. In brief, his submissions is that Respondent No.5-Society can operate in multiple gram panchayats. There cannot be an executive direction to delete a particular grama panchayat from its area of operation Respondent No.5-Society will not have any objection for formation of a new society for PACS and/or for its members to become members of the newly formed PACS. 9. During the pendency of the above matter, an impleading application was filed by one Sri.Seetharam.G.V., to come on record to contend that; 9.1. Any orders which may be passed in the present petition would have an adverse impact on the impleading applicant. The impleading applicant claimed to be a permanent resident of Bechanahalli Gram Panchayat as also a Chief promoter of the proposed Bechanahalli Primary Agricultural Credit Co-operative Society. 9.2. There being 12 other promoters from the different villages comprising of Bechanahalli Gram Panchayat. A meeting was held of the said promoters on 08.10.2023 under the Chairmanship of the impleading applicant where it was decided that there is a requirement for formation of a society to operate within the limits of Bechanahalli Gram Panchayat. There being 1100 families in the said Gram Panchayat depending on agriculture, there being 15 villages comprised in the said Gram Panchayat carrying on agriculture for more than 1,500 acres of land. 9.3. The said promoters had agreed to establish the Society by submitting all the requisite documents before the appropriate authorities and in pursuance thereof on 11.10.2023, a proposal has been submitted to the ARCS. The ARCS being satisfied with the requirement to establish a new society at Bechanahalli had directed Respondent No.5-Society to release the Bechanahalli Gram Panchayat from the area of operation of Respondent No.5-Society by issuance of directions under sub-section (5) of Section 12 of the KCS Act on 29.11.2023. 9.4. It is contended that the impleading applicant is the Chief Promoter of the proposed Bechanahalli Society along with 12 other promoters and they have been trying to establish a society for the past several years and having fulfilled all the requirements, are entitled to get permission to establish a new society. 9.5. 9.4. It is contended that the impleading applicant is the Chief Promoter of the proposed Bechanahalli Society along with 12 other promoters and they have been trying to establish a society for the past several years and having fulfilled all the requirements, are entitled to get permission to establish a new society. 9.5. Respondent No.5-Society which operates in four Gram Panchayat areas in its own interest has made efforts to stop the establishment of a new society in Bechanahalli. There being a requirement to establish a PACS in each gram panchayat, Respondent No.5-Society cannot come in the way of the establishment of a Bechanahalli PACS. It is taking into account these factors that the Registrar had issued a direction under Sub-section (5) of Section 12 of the KCS Act for deletion of the Bechanahalli gram panchayat from the area of operation of Respondent No.5-Society. This being with the intention to facilitate the establishment of Bechanahalli gram panchayat. 9.6. Thus, he submits that the said direction would have to be accepted by Respondent No.5- socitey, and Bechanahalli Gram Panchayat be deleted from the area of operation. 10. Sri. Devi Prasad Shetty., learned counsel for another impleading applicant in IA No.3 of 2024 would submit that; 10.1. The impleading applicants are three other promoters of the Bechanahalli Primary Agriculture Credit Co-operative Society and on the same grounds as urged by the counsel in so far as IA No.1 of 2024, Sri.Devi Prasad Shetty., learned counsel submits that the above petition is required to be dismissed. 11. Sri.Yogesh D.Naik., learned AGA would submit that; 11.1. A circular dated 24.04.2008 has been issued and it is in terms of the said circular that the viability of the establishment of new Society would have to be considered. The circular dated 24.04.2008 is reproduced here under for easy reference. 11.2. He submits that subsequently, another circular has been issued on 12.05.2017 in terms whereof it has been directed that wherever the requirements of the said circular are satisfied, a new PACS would have to be established. The circular dated 12.05.2017 is reproduced here under for easy reference; 11.3. His submission is that there being certain requirements as afore indicated to be fulfilled by the promoters of a new Society, the viability of the new Society would have to be considered by the Registrar before registering such a Society. The circular dated 12.05.2017 is reproduced here under for easy reference; 11.3. His submission is that there being certain requirements as afore indicated to be fulfilled by the promoters of a new Society, the viability of the new Society would have to be considered by the Registrar before registering such a Society. The Registrar being of the opinion that two societies operating in Bechanahalli Gram Panchayat may not be viable has by exercising powers under Sub-section (5) of Section 12 of the KCS Act directed Respondent No.5-Society to delete Bechanahalli Gram Panchayat from its area of operation. This, he submits is in the interest of all concerned and as such this Court ought to dismiss the above petition. 12. Heard Sri.Jayakumar S.Patil., learned Senior counsel appearing for the Petitioner, Sri.Yogesh D.Naik., learned AGA appearing for Respondent No.1 to 4, Sri.T.P.Rajendra Kumar Sungay., learned counsel appearing for Respondent No.6, Sri.Sandesh T.B., learned counsel appearing for Respondent No.5 and Sri.Deviprasad Shetty., learned counsel appearing for Respondents No.7 to 13. Perused papers. 13. The points that would arise for consideration are; 1. Whether by direction issued under sub- section (5) of Section 12 of the KCS Act the area of operation of an existing society can be directed to be deleted to facilitate the establishment of a new society? 2. Whether there is a mandate for establishment of a PACS in each gram panchayat and whether there is an embargo on two or more PACS operating in the same area? 3. Whether in the present case grounds have been made out for interference with the directions issued by the Registrar? 4. What order? 14. I answer above points as under; 15. Answer to point No.1: Whether by direction issued under sub-section (5) of Section 12 of the KCS Act the area of operation of an existing society can be directed to be deleted to facilitate the establishment of a new society? 15.1. In terms of the facts stated above, it is clear that Respondent No.5-Antarasanthe Primary Agriculture Co-operative Society Limited operates under five gram panchayats, one of them being Bechanahalli Gram Panchayat. The residents of Bechanahalli Gram Panchayat wanting to establish a PACS in Bechanahalli Gram Panchayat contend that they are unable to do so on account of Respondent No.5 having Bechanahalli as its area of operation. The residents of Bechanahalli Gram Panchayat wanting to establish a PACS in Bechanahalli Gram Panchayat contend that they are unable to do so on account of Respondent No.5 having Bechanahalli as its area of operation. It is for that reason that the said residents and promoters of a PACS, to be established in Bechanahalli had approached the Registrar to delete Bechanahalli Gram Panchayat from the area of operation of Respondent No.5. In pursuance of which the Registrar issued direction under Sub-section (5) of Section 12 of the KCS Act calling upon Respondent No.5 to delete Bechanahalli Gram Panchayat from its area of operation. 15.2. These being the facts, the legality or otherwise has been brought in question in the present petition. Sub-section (5) of Section 12 is reproduced hereunder for easy reference; 12. Amendment of bye-laws of a co-operative society . (5) If it appears to the Registrar that any amendment of the bye-laws of a Co-operative Society is necessary or desirable in the interest of such Society or to give effect to the provisions of the Act made thereunder, the Registrar may, by order, may direct the Co-operative Society, to make the Amendment proposed by him in such manner as may be prescribed and within such time as he may specify. 15.3. A perusal of the above provision would indicate that if it appears to a registrar that an amendment of the byelaws of a co-operative Society is necessary or desirable to give effect to the provisions of the Act, the Registrar by order can direct the Co-operative Society to make Amendment proposed by him in such manner as may be prescribed and within such time as he may specify. 15.4. Thus, the Amendment under Sub-section (5) of Section 12 is not a voluntary amendment of the Society but is one which is directed by the Registrar for the Society to be carried out, if the Registrar were of the opinion that it was necessary or desirable to give effect to the provisions of the Act. Thus, any direction under Sub-section (5) of Section 12 would have to be to give effect to the provisions of the Act. 15.5. Thus, any direction under Sub-section (5) of Section 12 would have to be to give effect to the provisions of the Act. 15.5. The submission of Sri.T.P.Rajendra Kumar Sungay and Sri.Yogesh D.Naik., learned AGA are that in terms of a circular dated 24.04.2008, it was required for a PACS to be established at each Gram Panchayat, to enable the residents of the said Gram Panchayat to have easy access to the said co-operative Society and conduct business with the said co-operative Society. 15.6. Another circular having been issued on 12.05.2017 also reiterates the same and gives the details as regards the requirement to be fulfilled by the new Society. Thus, submission is that there cannot be two PACSs carrying on its business in the same Gram Panchayat, there is to be only one PACS which can carry on its business in a particular Gram Panchayat. 15.7. The further submission is that Respondent No.5 carrying on its business in five Gram Panchayats, the deletion of one Gram Panchayat would not cause any harm, loss or injury to Respondent No.5. However, the proposed Bechanahalli PACS would not be capable of being established without Bechanahalli Gram Panchayat being deleted from the area of operation of Respondent No.5. It is this aspect that they contend satisfies the requirement of Sub-section (5) of Section 12, inasmuch as the Registrar has felt it necessary to delete Bechanahalli Gram Panchayat so as to establish a new PSCS in Bechanahalli, the Registrar has also felt it to be desirable so as to not have unnecessary competition in Bechanahalli. 15.8. What is required to be considered is whether such direction is in accordance with or to give effect to the provision of the KCS Act. The KCS Act does not anywhere mandate or indicate that there has to be one PACS in each Gram Panchayat. In fact, Section 28-A speaks of the management of the co-operative societies vesting in the board of the Society. Sub-section (1) and sub-section (2) of Section 28A are reproduced hereunder for easy reference; 28A. Management of co-operative societies vest in the *board *.- (1) The management of a co- operative society shall vest in a *board* constituted in accordance with this Act, the rules and the bye- laws of such Society. Sub-section (1) and sub-section (2) of Section 28A are reproduced hereunder for easy reference; 28A. Management of co-operative societies vest in the *board *.- (1) The management of a co- operative society shall vest in a *board* constituted in accordance with this Act, the rules and the bye- laws of such Society. The *board* shall exercise such powers, discharge such duties and perform such functions as may be conferred or imposed upon it by this Act, the rules and the bye-laws. (2) The *board* of a co-operative society shall consist of [not less than thirteen] but not exceeding the number of members specified below excluding [XXX]the Chief Executive, namely:— (i) in case of a primary society and a secondary society whose area of operation extends to,- (a) a part of taluk, thirteen members; b) whole of taluk, fifteen members; (c) beyond a taluk but not beyond a district, fifteen members: Provided also that in case of Urban Co-operative Banks having area of operation not beyond a district the maximum number shall not exceed seventeen members. (d) beyond a district, nineteen members] (ii) in the case of a federal society, [including] Apex societies, twenty one members; (iii)XXX] Provided that a member shall not represent more than one constituency in the *board* of a society. Provided that, subject to the minimum and maximum number of the members of the board specified in sub- section (2) of section 28A, the bye-laws of a Co- operative Society shall provide for the composition of the board of that Society to include within the permissible limits,- (a) in case of assisted Society, Government nominee as specified in sub-section (4-B) of section 28A; (b) in case of all Co-operative Societies other than non agricultural credit Co-operative Societies, if necessary, an ex-officio member and nominee from financing or the credit agency. The remaining members of the board shall be filled only through election subject to the provisions of section 29E. 15.9. A perusal of Sub-section (2) of section 28A prescribes the minimum number of members of the board. The maximum numbers are prescribed under Clause (1) and Clause (2), respectively of Sub-section (2) of Section 28-A. 15.10. In terms of 28-A2(1A), if the primary Society and/or a secondary society whose area of operation extends to a part of a taluk - the number of maximum members of the board would be 13. The maximum numbers are prescribed under Clause (1) and Clause (2), respectively of Sub-section (2) of Section 28-A. 15.10. In terms of 28-A2(1A), if the primary Society and/or a secondary society whose area of operation extends to a part of a taluk - the number of maximum members of the board would be 13. In terms of 28-A2(1B), if the area of operation extends to the whole of taluk - the maximum number of board of directors could be 15. If the area of operation of the primary Society and/or secondary Society were to extend beyond a taluk, but not beyond a district - then 17 members. If the area of operation of the primary Society and/or secondary Society were to be beyond a district, the maximum number of board of directors could be 19 members. 15.11. A reading of sub-section (2) of Section 28-A therefore indicates that the legislature did not restrict the area of operation of a primary society or a secondary society to a gram panchayat, but permitted such primary Society or a secondary society to operate in a part of a taluk, whole of a taluk, within a district, as also beyond a district. A gram panchayat is not a unit of consideration under sub-section (2) of Section 28-A. 15.12. It is only the circular dated 24.4.2008 where the State Government has indicated that establishment of a PACS in each gram panchayat was desirable. This desirability is not traced to the statute but is traced to the executive wisdom of the Government. 15.13. Insofar as amalgamation, transfer of assets or division of the corporate societies, the same is dealt with by Section 14 of the KCS Act which is, reproduced hereunder for easy reference. 14. Amalgamation, transfer of assets and liabilities and division of co-operative societies. (1) A co-operative society may, by a resolution passed by a two-thirds majority of the members present and voting at a general meeting of the Society,— (a) divide itself into two or more co-operative societies; or (b) transfer its assets and liabilities in whole or in part to any other co-operative society which by a like resolution agrees to such transfer. (2) Any two or more co-operative societies may, by a resolution passed by a two-thirds majority of the members present and voting at a general meeting of each such Society amalgamate themselves and form a new co-operative society. (2) Any two or more co-operative societies may, by a resolution passed by a two-thirds majority of the members present and voting at a general meeting of each such Society amalgamate themselves and form a new co-operative society. (3) The resolution of a co-operative society under sub-section (1) or sub-section (2) shall contain all particulars of the transfer, division or amalgamation, as the case may be, and no such resolution shall have any effect unless approved by the Registrar. [Provided that in the case of a co-operative bank, the Registrar shall not approve such resolution without the previous sanction in writing of the Reserve Bank.] (4) When a co-operative society has passed any such resolution, and it has been approved by the Registrar, the co-operative Society shall give notice thereof in writing to all its creditors and such members of the Society as did not vote in favour of the resolution and, notwithstanding any bye-laws or contract to the contrary, any creditor or any member to whom such notice is given shall during the period of one month from the date of service of the notice upon him, have the option of withdrawing his shares, deposits or loans, as the case may be. (5) Any member or creditor who does not exercise his option within the period specified in sub-section (4) and every member who has voted in favour of the resolution shall be deemed to have assented to the proposals contained in the resolution. (6) A resolution passed by a co-operative society under this section shall not take effect until either,— (a) the assent thereto of all the members and creditors has been, or deemed to have been, obtained under this section or; (b) all claims of members and creditors who exercise the option referred to in sub-section (4) within the period specified therein, have been met in full. (7) Where a resolution passed by a co-operative society under this section involves the transfer of any assets and liabilities, the resolution shall, notwithstanding anything contained in any law for the time being in force, be a sufficient conveyance to vest the assets and liabilities in the transferee without any further assurance. 15.14. (7) Where a resolution passed by a co-operative society under this section involves the transfer of any assets and liabilities, the resolution shall, notwithstanding anything contained in any law for the time being in force, be a sufficient conveyance to vest the assets and liabilities in the transferee without any further assurance. 15.14. A perusal of Section 14 indicates that such amalgamation, transfer of assets and liabilities or division of co-operative societies contemplated under Section 14 is voluntary in nature i.e., it is for the members of the co- operative Society to decide on any of the above, pass a resolution which can be given effect to. 15.15. Section 14-A, which has been omitted in the year 2013 with effect from 11.02.2013, prior to deletion is read as under; 14-A. Power to direct amalgamation, division and reorganisation in public interest (1) Notwithstanding anything contained in this Act or the rules made thereunder and the bye-laws of the Co-operatives societies concerned, where the Registrar, is satisfied that it is essential in public interest or in the interest of co-operative movement or for the purpose of the securing the proper management of any co-operative societies without compromising their financial viability that any two or more co-operative societies should be amalgamated to form a single co-operative society or nay co-operative society should be divided or any co-operative society should be reorganized, the Registrar shall order the amalgamation, division or reorganization of such co-operative societies: Provided that in case of a Co-operative Bank no order under this sub-section shall not be made without the previous sanction in writing of the Reserve Bank. 2) No order under sub-section (1) shall be made by the Registrar or any other officer without giving an opportunity of making representation or of being heard with a notice of not less than thirty days to any co operative society or person likely to be affected by such order. (3) The order shall.? 2) No order under sub-section (1) shall be made by the Registrar or any other officer without giving an opportunity of making representation or of being heard with a notice of not less than thirty days to any co operative society or person likely to be affected by such order. (3) The order shall.? (a) provide for the devolution of the assets and liabilities of the co-operative society or societies amalgamated, divided or reorganized and the date on which the devolution takes effect, (b) specify- (i) the composition, strength, names and the term of office of the members (including the Chairman) of the first committee; (ii) who shall subject to Section 29-G be, the Managing Director/Secretary, of the new Co-operative Society or each of the co-operative societies, as the case may be:and (iii) the bye-laws which the new co-operative society or each of the new co-operative societies shall, until amended in accordance with the provisions of the Act and the Rules, follow: Provided that the Registrar may by order curtail the term under sub-clause (i) and take necessary steps to hold general meeting of the co-operative society and elections before the expiry of the term so curtailed (4) Every order under sun-section (3) shall be published in the Official Gazette and shall, unless otherwise specified in the order, come into force on such publication. (5) The order referred to in sub-section (1), may contain such incidental, consequential and supple-mental provisions as may, in the opinion of the Registrar, be necessary to give effect to the amalgamation or division or reorganization as the case may be. (6) Notwithstanding anything contained in the Transfer of Property Act, 1882 (Central Act 4 of 1882) or the Registration Act, 1908 (Central Act 16 of 1908), in the event of amalgamation, the registration of the amalgamated co-operative society and in the event of division, the registration of new co-operative societies shall with effect fro the date specified in the order of amalgamation or division in each case be sufficient conveyance to vest the assets and liabilities of the amalgamating co-operative Societies or the original co- operative Society in the amalgamated co-operative Society or the new co-operative societies, as the case.may be. (7) The amalgamation or division or reorganization of a co-operative society shall not affect any right or obligation of the co-operative societies so amalgamated or the co-operative society so divided or reorganized or render defective any legal proceedings which might have been continued or commenced by or against the co- operative societies which have been so amalgamated or divided or reorganized and accordingly such legal amalgamated co-operative society, the reorganized co- operative society or the new co-operative societies as the case may be. 15.16. Thus, it is prior to 11.02.2013 that the Registrar could have directed the amalgamation, division or reorganisation in public interest. The said provision has been deleted with effect from 11.02.2013 in pursuance of the 97 th Amendment to the Constitution, wherein the right of the co- operative Society to be democratically run has been accepted. It is in pursuance of the said 97 th Amendment that the interference by the officers of the Government or by the Government has been restricted and the co- operative Society would be required to be run as per the democratic Will of the members of the Society so long as they comply with the requirements of the KCS Act and Rules as also any law applicable thereto. 15.17. There is a duty which has been cast on the State under Article 43-B to promote voluntary formation, autonomous functioning, democratic control and professional management of co- operative Society. Which is also in furtherance of the right to carry on business recognised under Article 19(1)(g) of the Constitution. 15.18. The fact that Section 14-A has been omitted from the statute book contemporaneous with the 97 th Amendment to the Constitution would indicate that the Registrar would not have any right to direct amalgamation, transfer of assets, division, reorganisation of a co-operative society and the only manner in which the same can be done is voluntarily under Section 14 of the KCS Act. Therefore, there is no particular statute or object recognised in the KCS Act 1959 which would confer powers on the Registrar to direct the deletion of any particular area from the area of operation of an existing society, so as to facilitate the establishment of a new society. 15.19. Therefore, there is no particular statute or object recognised in the KCS Act 1959 which would confer powers on the Registrar to direct the deletion of any particular area from the area of operation of an existing society, so as to facilitate the establishment of a new society. 15.19. Thus, I answer point No.1 by holding that no direction can be issued under sub-section 5 of Section 12 of the KCS Act to delete a particular gram panchayat or a taluk or a district from the area of operation of an existing society let alone to facilitate the establishment of a new society. 16. Answer to point No.2; Whether there is a mandate for establishment of a PACS in each gram panchayat and whether there is an embargo on two or more PACS operating in the same area? 16.1. Though it is contended that it is on account of the operation of the Respondent No.4 in Bechanahalli that a new PACS cannot be established and in terms of the 2008 circular there is a requirement to establish a PACS in each gram panchayat. 16.2. A perusal of the circular as also the KCS Act, does not indicate any embargo on two or more PACS operating in the same area. In fact by way of the 97 th Amendment to the Constitution, what is sought to be achieved by introducing Article-43B in the Constitution is promotion of voluntary formation, autonomous functioning, democratic control and professional management of co-operative societies. The same would also indicate that the intention is to promote competition amongst co-operative societies by way of such professional management, so as to achieve the best possible results by any co-operative society for its members. 16.3. The mandate under circular of 2008 to establish a PACS in each Gram Panchayat cannot be read to indicate creation of a monopoly for a PACS in a particular Gram Panchayat. That would be and Act contrary to Article-43B of the Constitution of India. Neither can Respondent No.5 contend that no co-operative society can be established in Bechanahalli which comes under the area of operation of Respondent No.5, nor can a new society proposed to be established in Bechanahalli contend that Respondent No.5 has to cease its operation in Bechanahalli Respondent No.5 has rightly not taken any such stand. 16.4. Neither can Respondent No.5 contend that no co-operative society can be established in Bechanahalli which comes under the area of operation of Respondent No.5, nor can a new society proposed to be established in Bechanahalli contend that Respondent No.5 has to cease its operation in Bechanahalli Respondent No.5 has rightly not taken any such stand. 16.4. Sri.Jaykumar S. Patil, learned Senior counsel who appears for Respondent No.5-Society has categorically submitted that the said directors do not have any objection for a new society to be established in Bechanahalli and to operate in Bechanahalli. 16.5. His further categorical submission is that the members of Respondent No.5 can also become members of the proposed Society, upon them completing all their obligations to Respondent No.5, if there are any loans to repay the loans, resign from the membership of Respondent No.5 and become a member of the proposed Society. 16.6. Similarly is the submission of Sri.Sandesh.T.B., learned counsel who appears for the Society, his categorical submission is that Society has no objection for a new society to be established in Bechanahalli and similarly, he submits that the Society has no objection for any of the members of the Respondent No.5-Society to resign and become members of the new proposed Society. 16.7. Section 16 of the KCS Act deals with persons who can become members. The same is reproduced hereunder for easy reference: 16. Persons who may become members .- (1) Subject to the provisions of section 17, no person shall be admitted as a member of a co- operative society except the following, namely: (a) an individual who needs the services of such co- operative Society [and is residing in the area of the operation of the Society] and is competent to enter into contract under the Contract Act, 1872(Central Act IX of 1872)] (a-1) a depositor] (b) any other co-operative society; (c) the state Government or the Central Government; (d) the Life Insurance Corporation of India, State Warehousing Corporation and such other institutions as may be approved by the State Government; (e) a firm, a company or any other body corporate constituted under any law for the time being in force including a society registered under the Karnataka Societies Registration Act, 1960 (Karnataka Act 17 of 1960); (f) a Market committee established under the Karnataka Agricultural Produce Marketing (Regulation)Act, 1966 (Karnataka Act 27 of 1966); (g) a local authority. Explanation.—For the purpose of this clause, local authority means, a Municipal Corporation, Municipal Council, Town Panchayat, Zilla Panchayat, Taluk Panchayat or Grama Panchayat constituted under any law for the time being in force.] (2) No co-operative society shall, without sufficient cause, refuse admission to membership to any person duly qualified therefor under the provisions of this [Act, rules and bye-laws] (3) Any person seeking admission as a member of any co-operative society shall make an application in writing for admission as a member of such Society. (4) Every co-operative Society shall within [two months] from the date on which application for admission was delivered to such Society either admit or refuse to admit any such person as a member, and shall send a written communication of such admission or refusal to the applicant before the said period. If no communication of admission as a member is received by the applicant before the expiry of the said period, his application for admission [shall be deemed to have been accepted]3 by the co-operative Society on the last day of the said period for purposes of section 105A.] (5)XXX (6)XXX (7)XXX (8) Notwithstanding anything contained in this section and section 17, the State Government shall be deemed to have been admitted as a member of a co-operative society on the day it subscribes to the share capital of such co-operative Society. 16.8. A perusal of Section 16 would indicate that any individual who needs the services of a co- operative society can become a member of the Society in whose area of operation he resides and is competent to enter into a contract amongst other aspects. 16.9. Section 17 of the KCS Act deals with disqualification for membership. The same is reproduced hereunder for easy reference; 17. Disqualification for membership .- (1) No person shall be eligible for admission as a member of a co-operative society, if he,— (a) has applied to be adjudicated an insolvent or is an undischarged insolvent; or (b) has been sentenced for any offence, other than an offence of a political character or an offence not involving moral turpitude, such sentence not having been reversed or the offence pardoned and a period of five years has not elapsed from date of expiry of the sentence. (c) carries on [XXX] business of the kind carried on by such co-operative Society;[Explanation.—XXX] 2 (d) is already a member of a co-operative society carrying on business of the same kind as itself; (e) is not eligible for membership under section 16; (f) is a paid employee of the Society or of its financing bank; or (g) XXX]2] 1 (2) If a member becomes subject to any of the disqualifications specified in 1[x x x] sub-section (1)] , he shall be deemed to have ceased to be a member from the date when the disqualification was incurred. (2A) If a member fails to fulfil his obligations as a member under the Act, rules or bye-laws, for a continuous period of three years, he shall, on the expiry of such period, cease to be a member.] (3) If any question arises as to whether a member is deemed to have ceased or has ceased to be a member under sub-section (2) or (2A), the Registrar may either suo-motu or on a report made to him and after giving an opportunity to the person concerned of being heard, decide the question. 16.10. It is under Clause (d) of Sub-section (1) of Section 17 that there is a disqualification prescribed indicating that no person shall be eligible for admission as a member of the Co- operative Society, if he is already a member of a co-operative society carrying on the business of the same kind as itself. It is on account of this Sub-clause (d) of Sub-section (1) of Section 17, that there is an embargo on a person from becoming a member of two societies. 16.11. Probably the legislature has not considered this aspect simultaneous with the other amendments made in pursuance of the 97 th Amendment. The existence of Clause (d) of Sub-section (1) of Section 17 would be anathema to Article-43B. Of course, the validity or otherwise of the said clause is not under consideration before this Court, it is for the legislature, in its wisdom to consider this aspect in light of the 97 th Amendment. With the 97 th Amendment to the Constitution, this aspect of restricting a person to be a member of only one co-operative society will neither promote choice, efficient management or competition, this would probably require the legislature to bestow its attention and take a decision. 16.12. With the 97 th Amendment to the Constitution, this aspect of restricting a person to be a member of only one co-operative society will neither promote choice, efficient management or competition, this would probably require the legislature to bestow its attention and take a decision. 16.12. Be that as it may, what is required of this Court is to do is apply the law as is, which in terms of Clause (d) to Sub-section (1) of Section 17 mandates that one person cannot be a member of two Co-operative societies carrying on the business of the same kind. It is for this reason that the residents of Bechanahalli cannot both be a member of respondent No.5, as also a new society proposed to be formed in Bechanahalli. It is for those persons to decide democratically as to which Society they wish to become members of. Of course, as contended by Sri.Jaykumar S. Patil., learned Senior counsel and Sri.Sandesh.T.B., learned counsel for the Society, if any of the members of Respondent No.5 wish to resign from their membership of Respondent No.5, they have to comply with all their obligations before such resignation and thereafter they could become members of the proposed Bechanahalli PACS. As regards persons who are not members of Respondent No.5-Society they can always join the new Society without any compliance to Respondent No.5. 16.13. Hence, I answer point No. 2 by holding that the mandate under the circular of the year 2008 to establish a PACS in each gram panchayat does not operate as an embargo for two PACS to operate in the same area. 16.14. It would not require an existing PACS to delete from its area of operation a particular gram panchayat to enable the establishment of a PACS in that gram panchayat. It is for the member of an existing PACS to comply with all his obligations to the PACS of which he is a member, thereafter resign and join the new PACS. 16.15. If a person is not a member, The discretion would always be of such person to join such Co-operative Society as he or she wishes to join. 17. Answer to point No.3; Whether in the present case grounds have been made out for interference with the directions issued by the Registrar? 17.1. 16.15. If a person is not a member, The discretion would always be of such person to join such Co-operative Society as he or she wishes to join. 17. Answer to point No.3; Whether in the present case grounds have been made out for interference with the directions issued by the Registrar? 17.1. In view of my answers to points No.1 and 2, the ground on which the Registrar has issued a direction of sub-section (5) of Section 12 of the KCS Act is not to give effect to the provision of the Act but a circular of the year 2008. The said circular only indicates the desirability of the establishment of a PACS in each gram panchayat. The same does not restrict two or more PACS being established in the same area. 17.2. Thus, there is no power with the Registrar more particularly after the omission of Section 14A of the KCS Act to issue any direction to an existing society, to either delete a particular gram panchayat, taluk or district from the area of operation or amalgamate or transfer the assets of the Society. Thus, the direction issued by the Registrar in the present matter is not supported by the mandate of Sub-section (5) of Section 12. 17.3. Hence, I answer to point No.3 by holding that the direction issued by the Registrar which have been impugned in the present matter are not sustainable and is required to be quashed. 18. Answer to point No.4: What order? 18.1. In view of my answers to all the above, I pass the following; ORDER i. The writ petition is partly allowed ii. A certiorari is issued, the direction bearing Sani No.43:RSR:GRN:12(5):PR:2023-24 dated 29.11.2023 issued by Respondent No.4 at Annexure-A is quashed. iii. Respondent No.5-Society can continue to function in Bechanahalli Gram Panchayat as per its byelaws. iv. The impleading applicants would also be entitled to establish a new society in Bechanahalli Gram Panchayat or beyond by following the due procedure, applicable rules and statute as regards which the petitioners or Respondent No.5 have categorically indicated that they have no objection. v. Furthermore, the petitioners or Respondent No.5 cannot have any objection for the establishment of a new society. Since there is no particular restriction for only one Society to operate in a particular gram panchayat. vi. v. Furthermore, the petitioners or Respondent No.5 cannot have any objection for the establishment of a new society. Since there is no particular restriction for only one Society to operate in a particular gram panchayat. vi. The Registrar is directed to process the application, if any, filed or to be filed by the impleading applicants in accordance with law within the time frame prescribed under the Act as expeditiously as possible.