Andhra HC (Pre-Telangana)
P. Chandra Reddy And Ors. vs The Government Of A.P., Housing (Ch) ... on 27 August, 2002
Equivalent citations: 2002(5)ALD515
Author: Elipe Dharma Rao
Bench: Elipe Dharma Rao
ORDER Elipe Dharma Rao, J.
1. The petitioner in Writ Petition 23411 of 1999 are the members of the BHEL (MIG) Employees Co-Operative Society Limited, Ramachandrapuram, Hyderabad (hereinafter referred to as the Society), which was registered under the provisions of the A.P. Co-Operative Societies Act, 1964 (for brevity the Act). The main objects of the society are to carry trade, building, buying and selling, hiring and letting and developing the land in accordance with the co-operative principles for the benefit of its members viz., to give loans to members for construction of new dwelling houses. The Managing Committee of the society was elected on 27.9.1998, that when the Managing Committee was not acting as per the bye-laws and in the interest of its members, some of the Members of the Society, have filed an application before the Deputy Registrar, Divisional Co-Operative officer, Hyderabad West - 4th respondent herein, which was registered as Arbitration Case No. 18 of 1999 and in exercise of the powers under Sec. 62(4) of the Act, passed an order directing the Managing Committee to cancel the cable TV activity. It is further observed by him that without amending the bye-laws and without seeking the approval of General Body, cable TV activity cannot be taken up by the Society and that order has become final. It is further claimed by the petitioners that under Sec. 32(1) of the Act, the Committee at any time call a General Meeting of the Society, but such meeting shall be held within six months of the end of the Co-Operative year and Sec. 32(1)(A) reads that if the General Meeting is not convened in accordance with Sub-Sec.(1) of Sec. 32, the Members of the Committee shall cease to hold the office on the day next after the first day on which the General Meeting should have been held and it shall be competent for the Registrar, not withstanding anything in the bye-laws, to call such General Meeting in such manner as may be prescribed.
2. Sec. 2(c) of the Act defines Co-Operative Year as the period commencing on the first day of the July of any year and ending with the 30th day of June of the succeeding year, or in the case of any society or class of societies, the accounts of which are made up to any other date with the previous sanction of the Registrar, the year ending with such date. Subsequent to amendment of this Section, the definition of Co-Operative Year reads to mean as the period commencing on the first day of the April of any year and ending with the 31st day of March of the succeeding year.
3. It is further submitted that the petitioner Society has taken the accounts year as the Co-Operative Year i.e. from 1st April to 31st March and as per the account audit, the petitioner society has taken Accounts year as the Co-Operative year. If the above co-operative year is taken into account, the society should have conducted General Body Meeting in the month of September, 1999 i.e. within a period of six months from the date of end of Co-Operative year i.e. by 30th September, but it was not conducted as contemplated under the Act. Therefore, by virtue of the operation of Sub-Sec. (1)(A) to Sec. 32of the Act, the Managing Committee automatically ceases to hold office, but to circumvent the provision of law, on the basis of the representation filed by the 2nd respondent, the first respondent issued the impugned order while exercising power under Sec. 123 of the Act, granting post facto permission to the Society for having conducted Annual General Meeting on 24.10.1995 under GO Rt. No. 257 Housing (CH) Department dated 28.10.1999. This order exempted the Society under Sec. 12 of the Act.
4. The correctness of this order that is assailed in this writ petition contending that Sec. 32(1) of the Act makes it clear that the Managing Committee has to convene meeting within a period of six months from the end of the Co-Operative Year and failure to convene the same, will result in cessation of Members of the Committee, next day under Sec. 32(1A) of the Act. It is also contended that the Government has no power under Sec. 123 of the Act to grant post facto exemption to conduct General Body Meeting after expiry of six months before the end of Co-Operative Year, muchless it has the power to grant such exemption for disqualification incurred by the Members of the Managing Committee. Therefore, the Government has not properly exercised the power conferred under Sec. 123 of the Act, which is not in consonance of the legislative intent. Therefore, the writ petition is liable to be dismissed.
5. While issuing rule nisi, this Court granted interim stay as prayed for on 11.11.1999. The respondents filed counter affidavit seeking to vacate stay granted on 11.11.1999 and in paragraph No.3 thereof, the deponent President of the Society has categorically admitted the present Managing Committee was elected on 27.9.1998. He has further admitted that:
"...it is true that as per Sec. 32 of the A.P. Co-Operative Societies Act, the General Body meeting of the Society shall be held every year. It is also true that our Society has to conduct the General Body Me4eting on 30.9.1999. it is the practice of the Society from the inception to convene the Annual General Body Meeting in the Community Centre on Sunday for the convenience of the members. After the General Elections in the month of September, 1999, on Sundays this Community Centre was booked by the BHEL Employees Co-Operative Credit Society and MIG Phase. II. This area is covered by two different Assembly Constituencies and one Parliamentary Constituency, where General Elections were held on 11th and 18th of September, 1999. Because of the above reasons, the Community Centre could not be available to our society for conducting General Body Meeting. Therefore, we have submitted a representation to the Divisional Co-Operative Officer, Hyderabad, West Division, requesting him to permit us to conduct Annual General Body Meting on 24.10.99. The Divisional Co-Operative Officer inturn wrote to the Joint Registrar/District Co-Operative Officer and recommended to accord exemption under Sec. 123 of the A.P. Co-Operative Societies Act from the provisions of Sec. 32 of said Act to enable the Managing Committee of the Society to conduct General Body Meeting after 30.9.1999 i.e. to conduct General Body Meeting on 24.10.1999.........
The Government After careful consideration of the request made by us and also the recommendations of the Divisional Co-Operative Officer, in its proceedings dated 28.10.1999 in GO Rt. No. 257 has accorded post facto permission exempting the Society under Section 123 of A.P. Co-Operative Societies Act, as by that time the General Body Meeting has already been conducted on 24.10.1999. There is no illegality or irregularity in this proceedings...."
6. Though several other averments are made in the counter affidavit, they are not relevant to be considered for the purpose of the lis herein.
7. From the above stated facts, the issue involved to be decided in this writ petition is whether the power exercised by the Government in granting post facto permission to conduct the half yearly General Body Meeting of the Society, before the end of the Co-Operative year, on the alleged ground of non-availability of a particular venue to conduct the Meeting, falls within the ambit of Sec. 123 of the Act.
8. Since the gamut of the lis involved in this writ petition revolves round Sec. 123 of the Act, it is apposite to extract the same, which read as under:
"...Power to exempt class of societies: The Government may, by general or special order and for reasons to be recorded therein, exempt any society or any class of societies from any of the provisions of this Act..."
9. Thus a reading of Sec. 123 of the Act makes it clear thus the Government by general or special order and for the reasons to be recorded, may exempt any society or class of societies from any of the provisions of the Act. A Division Bench of this Court in a decision State of Andhra Pradesh Vs. Multi Co-Operative Association, Hyderabad, 1987 (1) ALT 197 has held that section 123 is meant to meet extraordinary situation to be used not in a casual way or with interior motives and should be resorted sparingly and under exceptional circumstances and not for such purposes like avoiding elections for indefinite periods.
10. In yet another decision P. Narayana Rao and others Vs. The State of A.P., Represented by its Secretary, Food & Agriculture Department, Secretariat, Hyderabad and others, 1988 (1) ALT 278 this Court has held the Government under Sec. 123 of the Act, is not competent to issue G.O. exempting the Society from the provisions of Sec. 32(1-A) of the Act, four months after the Managing Committee members ceased to hold office.
11. A plain reading of Sec. 32(1A) of the Act shows that the cessation of the Members of the Committee takes place next day, in the event of the Committee's failure to convene meeting, six months before the end of the Co-Operative Year. To arrest this legal effect, Section 123 of the Act cannot be pressed into service, inasmuch as Sec.123 of the Act is not a provision for removal of disqualification but it only removes the obligation enjoined by law on the Societies. Such a power cannot effectively be exercised for removal of a disqualification incurred by the Societies by reason of their failure to discharge the obligation.
12. Having regard to the decided proposition of law, now let us examine the case on hand. The respondents herein have admitted that as per Sec. 32 of the Act, though they have to hold a meeting within six months of the end of the Co-Operative Year, they did not hold the same for the reason that the Community Centre was not available to their Society for conducting General Body Meeting, as the area is covered by two different Assembly Constituencies and one Parliamentary Constituency where General Elections were held on 11th and 19th September, 1999. As such they could conduct Annual General Body meeting only on 24.10.1999 and on their representation the Government issued the impugned GO granting post facto permission for having conducted the Annual General Body meting for the year 1998-99 exempting the Society under Sec. 123 of the Act. This very action of the Government in issuing the impugned GO with a view to circumvent the cessation of the Managing Committee, does not fall within the ambit of Sec.123 of the Act and the legislative intent, inasmuch as the Government has acted contrary to Sec. 123 of the Act and it amounts to removing the disqualification acquired by the members of the Society, as they have failed to discharge the obligation attached to them. Therefore, the impugned order issued by the Government has no effect exempting the society from holding the General Body Meeting, after they have acquired a disqualification under Sec. 32(1-A) of the Act.
13. Though the learned counsel for the respondent No. 5 has relied upon the definition of the Co-Operative year under Sec. 2(c) of the Act and submitted that it commences from 1st day of July to the 30th day of June of the succeeding year and it can hold the General Body Meeting at the end of December, 1999, but the meeting was held much earlier to the end of sixth month of the Co-operative year i.e. on 24.10.1999. I cannot appreciate the above contention in view of the admission of the deponent in the counter affidavit that the General Body Meeting should have been conducted on 30.9.1999. Further, as per the records submitted by the Learned Government Pleader, the audit certificate dated 31.3.1993 for the period from 1.7.1991 to 30.6.1992, shows that the respondents have taken the accounts year as the Co-Operative year of the Society and even as per their admission in the counter. Therefore, I cannot appreciate the contention of the learned counsel for the respondents that the Co-Operative Year is 1st July to 30th June of the year.
14. Further the Government while issuing the impugned order purported to be under the exercise of powers under Sec. 123 of the Act, did not assign any reasons except relying on the report of the Registrar of Co-Operative Societies, Hyderabad dated 22.10.1999, in exempting the society from the provisions of Sec.32 (1-A) of the Act and ratifying the action of having conducted the Annual General Body Meeting for the year 1998-99 on 24.10.1999. That apart, Sec. 123 does not empower the Government to grant post facto permission, in the form of ratification, legalizing the action of the society in conducting General Body Meeting after 30.9.1999, from which date the Members of the Society ceased to be Members. This action of the Government in issuing the impugned GO is contrary to the spirit of the Division Bench Judgment of this Court in Multi Co-Operative Association's case, referred to above. Therefore, I hold that the power conferred under section 123 of the Act has to be exercised to meet extraordinary situation and not be used in a casual way or with interior motives and should be resorted to sparingly and under exceptional circumstances and to remove the disqualification incurred by the members for not holding the General Body Meeting within a period of six months before the end of Co-Operative Year.
15. The plea that the area is covered by two different constituencies of Assembly and one Parliamentary Constituency, to which elections were scheduled on 11th and 18th September, 1999 as such the Community Centre was not available for them to conduct General Body Meeting cannot be countenanced. Mere non-availability of the Community Centre does not absolve the Society from conducting the General Body Meeting nor the Government can accept such a plea for granting post facto permission, as is done in the present case. Therefore, for all these reasons, I am of the considered view that the impugned order has no legs to stand to judicial scrutiny. Consequently, the impugned GO is set aside and the Writ Petition No. 23411 of 1999 is allowed, but without costs.
16. The Writ Petition No.8023 of 2000 is filed by the 5th respondent in WP No. 23411 through its Incharge President to issue a writ of certiorari and quash the proceedings in RC No. 1915 of 1999 - P dated 25.4.2000 appointing the 4th respondent as person-in-charge and declaring the Managing Committee of the Society as ceased to hold the office.
17. For the elaborate reasons discussed above, this writ petition is devoid of merits and is liable to be dismissed and is accordingly dismissed. No order as to costs.