Bombay High Court
Krushnapur vs The State Of Maharashtra on 8 June, 2015
Author: B.R.Gavai
Bench: B.R. Gavai
1
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH, NAGPUR
LETTERS PATENT APPEAL NO.66/2002 IN
WRIT PETITION No.1998/2002
Marotrao s/o Nanaji Pachbhai,
aged about 46 years,
occupation : Agriculturist, resident of
Krushnapur, P.O. Narade (Purade),
Tahsil Wani, Distict Yavatmal .. Appellant
Versus
1] The State of Maharashtra,
through its Secretary,
Department of Co-operation and Marketing
Mantralaya, Mumbai 32.
2] The Divisional Joint Registrar,
Co-operative Societies, Amravati.
3] Yeotmal District Central
Co-operative Bank Limited, Yeotmal,
through its Manager, at and post
Tahsil and District Yeotmal.
4] The Collector, Yeotmal. Respondents
5] Narendra s/o Keshaorao Thakre,
aged about 54 years,
Occ. Agriculturist,
R/o At Post Kumba, Tq.
Maregaon,
Dist. Yeotmal. Intervenor
...
Shri P.C. Madkholkar, Advocate for the appellant.
Shri M.K. Pathan, AGP for respondent nos. 1, 2 & 4.
...
CORAM : B.R. Gavai &
Indira K.Jain, JJ.
DATE : 8th June, 2015.
ORAL JUDGMENT (Per B.R.Gavai, J.)
1] Heard the learned counsel for the respective parties.
::: Downloaded on - 11/06/2015 23:59:07 ::: 22] The appeal challenges the order passed by the learned Single Judge of this Court dated 12th of June, 2002 in Writ Petition No.1998/2002 thereby dismissing the petition which is filed by the petitioner.
3] The facts in brief give rise to filing of the present petition are as under:-
That, the respondent no.3-Bank is a specified Co-operative Society, as provided under Section 73G of the Maharashtra Co-operative Societies Act, 1960 (hereinafter referred to as "the said Act"). By a Resolution dated 14th August, 2001 the amendment was approved in the Annual General Meeting of the said bank. As per the said Resolution, the number of Directors which was originally 15 was sought to be increased to 17 as required under the provisions of Section 13 of the said Act. The Competent Authority i.e. respondent no.2 was moved for grant of approval to the amendment of the said bye-laws. The respondent no.2 vide his order dated 27th of November, 2001 directed the amendment of the bye-laws with a modification instead of 17 Directors as proposed, the approval was given to 16 Directors.
Being aggrieved thereby, an appeal was preferred before the State Government. The State Government also dismissed the appeal. Being aggrieved thereby, a writ petition came to be filed before the learned Single Judge of this Court. The learned single Judge also dismissed the petition. Hence, this appeal.::: Downloaded on - 11/06/2015 23:59:07 ::: 3
4] Shri Madkholkar, the learned counsel appearing on behalf of the appellant, submits that the learned Single Judge has failed to take into consideration that the power under Section 13 of the said Act as is available to the Registrar is only restricted either granting approval to the amendment proposed by the society or refusing the same. He submits that if however the Director feels that the amendment to the byelaws is necessary in the public interest then it can be done only by following the procedure as prescribed under Section 14 read with Rule 13 of the Maharashtra Co-operative Societies Rules, 1961 (hereinafter referred to as "the said Rules" ) .
5] Shri Pathan, the learned AGP, on the contrary, submits that modification which was done by the respondent no.2 was in consonance with the public policy of providing only one Director for one Taluka. He submits that, in any event, under sub-rule (5) of Rule 12 of the said Rules, the Registrar has power to grant approval to the amendment with the modification, as are necessary, in the larger public interest.
6] With the assistance of the learned counsel for the parties, we have scrutinized the material on record and also have examined the relevant provisions. For appreciating the rival controversy, it will be necessary to refer to Section 13 and Section 14 of the said Act and Rule 12 and Rule 13 of the said Rules. They ::: Downloaded on - 11/06/2015 23:59:07 ::: 4 read thus:-
"13. AMENDMENT OF BY-LAWS OF SOCIETY.
(1) No amendment of the by-laws of a society shall be valid until registered under this Act. For the purpose of registration of an amendment of the by-
laws, a copy of the amendment passed, in the manner prescribed, at a general meeting of the society, shall be forwarded to the Registrar. Every application for registration of an amendment of the by-laws shall, be disposed of by the Registrar within a period of two months from the date of its receipt.
[Provided that, the application for registration of the amendment of by-laws of the co-operative credit structure entity shall be disposed of, by the Registrar within a period of one month from the date of its receipt) (IA) Where there is a failure on the part of the Registrar to dispose of such application within the period aforesaid, the Registrar shall, within a period of fifteen days from the date of expiration of that period refer the application to the next higher officer and where the Registrar himself is the registering officer, to the State Government, who or which, as the case may be, shall dispose of the application within two months from the date of its ::: Downloaded on - 11/06/2015 23:59:07 ::: 5 receipt and on the failure of such higher officer or the State Government, as the case may be, to dispose of the application within that period, the amendment of the bye-laws shall be deemed to have been registered.
(IB) No amendment of the bye-laws of a society shall be registered by the Registrar under this section or in the case of the bye-laws which are deemed to have been registered shall have effect, if the amendment is repugnant to the policy directives, if any, issued by the State Government under section 4.
(2) When the Registrar registers an amendment of the by-laws of a society for where an amendment of the by-laws is deemed to have been registered], he shall issue to the society a copy of the amendment certified by him, which shall be conclusive evidence that the same is duly registered.
(3) Where the Registrar refuses to register such amendment of the by-laws of a society, he shall communicate the order of refusal, together with his reasons therefore, to the society.
::: Downloaded on - 11/06/2015 23:59:07 ::: 614. POWER TO DIRECT AMENDMENT OF BY-
LAWS-
(1) If it appears to the Registrar that an amendment of the by-laws of a society direct is necessary or desirable in the interest of such society, he may call upon the society, in the manner prescribed, to make the amendment within such time as he may specify.
(2) If the society fails to make the amendment within the time specified, the Registrar may, after giving the society an opportunity of being heard and after consulting such State federal society as may be notified by the State Government register such amendment, and issue to the society a copy of such amendment certified by him. With effect from the date of the registration of the amendment in the manner aforesaid, the by-laws shall be deemed to have been duly amended accordingly;
and the by-laws as amended shall, subject to appeal (if any), be binding on the society and its members.
Rule 12. Amendment of bye-laws:-
(1) Subject to the provisions of this rule, bye-laws of a society may be amended by passing a ::: Downloaded on - 11/06/2015 23:59:07 ::: 7 resolution at a general meeting of the society held for that purpose.
(2) The society shall give due notice in accordance with its bye-laws to all the members for considering any amendment thereof.
(3) An amendment shall be deemed to have been duly passed, if a resolution in that behalf is passed at a general meeting by not less than two-thirds of the members present thereat, and voting.
(4) After the resolution is passed, a copy thereof shall, within a period of two months from the date of the meeting at which the resolution was passed, be furnished to the Registrar along with, --
(a) a copy of the relevant bye-laws in force with amendments proposed to be made in pursuance of the resolution, together with reasons justifying such amendments.
(b) four copies of the text of the bye-laws as it would stand after amendment, signed by the officers duly authorised in this behalf by the committee of the society;
(c) a copy of the notice given to the members of the society of the proposal to amend the bye-law;
(d) such other information as may be required by the Registrar.::: Downloaded on - 11/06/2015 23:59:07 ::: 8
(5) On receipt of a copy of the resolution and other particulars referred to in sub-rule (4), the Registrar shall examine the amendment proposed by the society and if he is satisfied that the amendment is not contrary to the Act or the rules and is in the interest of the society and co-operative movement, he may register the amendment and issue to the society a copy of the amendment certified by him under sub-section (2) of Section 13. Where the Registrar is of opinion that the proposed amendment may be accepted subject to any modification, he may indicate to the society such modification after explaining in writing his reasons therefor.
Rule 13. Manner of calling upon society to make amendment to bye-laws:-
(1) Subject to the provisions of this rule, the Registrar may by serving a notice in Form 'E' call upon a society to make such amendment to the bye-laws of the society as he considers to be necessary or desirable in its interest, within a period not exceeding two months from the date of service of notice. The notice shall state the exact amendment which the society should make.::: Downloaded on - 11/06/2015 23:59:08 ::: 9
(2) For the purposes of sub-section (2) of Section 14, the Registrar shall send a copy of the notice to the State Federal Society duly notified under that sub-section with a request to offer its comments on the amendment within such time as may be specified by him. If the State Federal Society fails to offer its comments within the specified time, it may be presumed by the Registrar that the said society has no objection to the amendment.
(3) If after considering the comments of the State Federal Society, if any, the Registrar considers that there is no objection to registering the amendment, he shall send a written notice in Form 'F' by registered post to the registered address of the society calling upon it to show cause in writing, or through a properly authorised representative to appear before the Registrar on the date specified in the notice, as to why the proposed amendment should not be registered within the time specified in the notice in Form 'E' .
(4) After the expiry of the period specified in the notice in Form 'E' and after considering the reply, if any, of the society and the views, if any, of the State Federal Society on such reply, the Registrar may, after considering the objections of the society ::: Downloaded on - 11/06/2015 23:59:08 ::: 10 (if any) to the proposed amendment, register the amendment".
7] It will thus be seen that Section 13 provides that an amendment to bye-laws of the society cannot be valid unless it is registered under the provisions of the said Act. The procedure prescribed for registration is that a copy of the amendment passed in the manner prescribed in the general meeting of the society is required to be forwarded to the Registrar. Such an application is required to be decided by the Registrar within a period of two months from the date of its receipt. Sub Section (1-A) provides that where there is failure on the part of the Registrar to dispose of such application within the period prescribed, the Registrar shall, within a period of fifteen days from the date of expiration of that period refer the application to the next higher officer where the Registrar himself is the registering officer to the State Government. Such higher officer of the State Government is required to dispose of the application within two months from the date of its receipt. It can further be seen that on failure on the part of such higher officer of the State Government to dispose of the application within that period, the amendment of bye-laws shall be deemed to have been registered. Sub-section (1-B) provides that no amendment of bye-laws of a society shall be registered by the Registrar under the said Section or in the case of the bye-laws which are deemed to have been registered shall have effect, if the amendment is repugnant to the policy directives, ::: Downloaded on - 11/06/2015 23:59:08 ::: 11 if any, issued by the State Government under Section 4. Section 4 provided that where the Registrar registered the amendment of the bye-laws of the society or where the amendment of bye-laws is deemed to have registered, he shall issue to the society the copy of the amendment certified by him which shall be conclusive evidence of the same being registered. Sub-section (3) further provides that where the Registrar refuses to register such amendment of the bye-laws of the society he shall communicate the order of refusal together with reasons thereof to the society.
Rule 12 deals with the procedure of amendment of bye-laws. Sub-
rule (1) of Rule 12 requires that bye-laws of the society may be amended by passing a resolution at a General Body Meeting of the society held for that purpose. Sub-rule (2) of Rule 12 requires a proper notice will have to be given in accordance with its bye-laws to all the members of the society for considering the amendment thereof. Sub-rule (3) thereof provides that for the resolution to be duly passed, it has to be passed by majority of not less than two-
thirds of the members present in the meeting and voting. Sub-
rule (4) thereof provides for the procedure in which the application has to be made to the Registrar. Sub-rule (5) thereof provides that on receipt of the copy of the resolution and other particulars the Registrar shall examine the amendment proposed by the society and if he is satisfied that the amendment is not contrary to the Act or the Rules and it is in the interest of society and a co-operative movement, he may register the amendment and ::: Downloaded on - 11/06/2015 23:59:08 ::: 12 issue to the society a copy of the certified by him under sub-
section (2) of Section 13. It, however, provided that if the Registrar is of opinion that the proposed amendment may be accepted, subject to any modification, he may indicate to the society such modification after explaining in writing his reasons therefor.
8] Section 14 deals with power to direct amendment of bye-laws. Sub-section (1) thereof provides that, if it appears to the Registrar that an amendment of the by-laws of a society is necessary or desirable in the interest of such society or any bye-
laws of the society are inconsistent with the provisions of the Act or Rules and that the amendment is necessary in such bye-laws, he may call upon in the manner prescribed to make the amendment within such time as he may specify. Sub-section (2) thereof provides that if the society fails to make the amendment within the time specified, the Registrar after giving the society an opportunity of being heard and after consulting such State Federal Society as may be notified by the State Government register such amendment and issue to the society a copy of such amendment certified by him. It further states that with effect from the date of registration of the amendment, the bye-laws shall be deemed to have been amended and the bye-laws shall subject to appeal, if any, would be binding on the society and its members. Proviso thereto requires the notified State Federal Society to communicate its opinion to the Registrar within a period of 30 days from the ::: Downloaded on - 11/06/2015 23:59:08 ::: 13 date of receipt of the communication, failing which it shall be presumed that such State Federal Society has no objection to the amendment and the Registrar would be at liberty to proceed further and to take action accordingly. Further proviso provides that the Registrar may specify the model by-laws for such type of society or class of society as he may deem fit.
9] Rule 13 deals with the entire procedure for manner of calling upon society to make amendment to bye-laws. Sub-rule (1) thereof requires the Registrar to serve a notice in Form `E' calling upon a society to make such amendment to the bye-laws of the society as he considers necessary or desirable in its interest.
Period of two months is prescribed for which the society is supposed to act on the basis of notice issued by the Register. Sub-
rule (2) thereof provides that for the purposes of sub-section (2) of Section 14 the Registrar shall send a copy of the notice to the State Federal Society duly notified under that sub-section with a request to offer its comments on the amendment within such time as may be prescribed by him. It further provides that if the State Federal Society fails to offer its comments within the prescribed time, it may be presumed by the Registrar that the said society has no objection to the amendment. Sub-rule (3) thereof further provides that if after considering the comments of the State Federal Society, if any, the Registrar considers that there is no objection to registering the amendment, he shall send a written ::: Downloaded on - 11/06/2015 23:59:08 ::: 14 notice in Form `F' by registered post to the registered address of the society calling upon it to show cause in writing, or through a properly authorised representative to appear before the Registrar on the date specified in the notice, as to why the proposed amendment should not be registered within the time prescribed in the notice in Form `E'. Sub-rule (4) further provides that after the expiry of the period specified in the notice in Form `E' and after considering the reply, if any, of the society and the views, if any, of the State Federal Society on such reply, the Registrar may, after considering the objections of the society (if any) to the proposed amendment, register the amendment.
10] Perusal of the aforesaid scheme would clearly reveal that Section 13 and Section 14 of the said Act operate in different fields. Section 13 deals with a situation wherein a society itself finds a particular amendment to be necessary; whereas Section 14 deals with a situation wherein the Registrar either in the public interest or interest of the society be finds a particular amendment necessary to be carried out by the society. A perusal of the scheme under Section 13 would further reveal that when the society moves for amendment of bye-laws under Section 13 the Registrar has either a power to register the said amendment or to refuse it. Insofar as the reliance placed by learned Assistant Government Pleader on sub-rule (5) of Rule 12 is concerned, no doubt that sub-rule (5) of Rule 12 permits the Registrar when he is ::: Downloaded on - 11/06/2015 23:59:08 ::: 15 of the opinion that the proposed amendment may be accepted subject to any modification, to indicate to the society such modification after explaining in writing his reasons therefor.
However, perusal of Section 13 would reveal that no power is vested with the Registrar to make any modification himself to the amendment as is passed by the resolution of the society. By now, it is settled principle of law that the Rules cannot expand the scope of a substantive statutory proviso. In any case, even a plain reading of sub-rule (5) of Rule 12 would reveal that the power is only to indicate to the society the modification as in the opinion of the Registrar are necessary after explaining in writing his reasons therefor. After such modification is indicated by the Registrar, in our view, the procedure as prescribed under sub-rules (1) to (4) of Rule 12 will have to be again followed by the society for considering the modification as suggested by the Registrar.
However, in our considered view, while exercising the powers under Section 13, the Registrar has no power to thrust the modification in the bye-laws on the society, which in his opinion is justified.
11] Perusal of the Section 14 read with Rule 13 would reveal that the power under the said provisions with the Registrar is to insist upon a society the amendment which the Registrar finds it necessary either in the public interest or in the interest of the society. The aforesaid provisions would reveal that the said ::: Downloaded on - 11/06/2015 23:59:08 ::: 16 provisions specifically provide for principles of natural justice to be followed while registering an amendment under the said provisions. The procedure specifically requires a notice to be given to the society, in case the society does not comply with the direction issued under sub-section (1) of Section 14. After the notice is issued, an opinion is also required to be sought from the State Federal Society. The proviso further requires a notice to be issued in a particular form to the society after consultation is received from the Federal society calling upon its views and also calling upon society to give its explanation in writing or through an authorised representative. The provision further requires that while exercising the power under Section 14 the Registrar must give reasons and also consider the submission made on behalf of the society. It can thus be clearly seen that when the Registrar is given a power to thrust an amendment of the society, the Legislature has provided for an in-built safeguard, inasmuch as an opportunity of being heard to a society and also an opportunity of consulting the State Federal Society is specifically provided for.
12] By now, it is settled principle of law that when the law requires a particular thing to be read in a particular manner, it has to be done in that manner alone or not at all. We may gainfully refer the judgments of Apex Court in the case of Dhananjaya Reddy Vs. State of Karnataka reported in (2001) 4 SCC 9 and in the case of Babu Verghese and others Vs. Bar Council of Kerala ::: Downloaded on - 11/06/2015 23:59:08 ::: 17 reported in (1999) 3 SCC 422 in that regard. It can thus be seen that when a particular amendment is to be insisted by the Registrar, he can do only under Section 14 and that too after following the procedure as provided under Section 14 and Rule 13.
While considering the application of the society under Section 13, the power of the Register is either to accept the amendment or to refuse it. However, he cannot thrust the amendment which he finds it to be necessary, while considering an application of the society under Section 13.
13] In that view of the matter, we find that the learned Single Judge has erred in dismissing the writ petition. The appeal is, therefore, allowed. The order passed by the learned Single Judge as well as by the State Government and the Divisional Joint Registrar of the Co-operative Societies are quashed and set aside.
Rule is made absolute in terms of prayer clause (B).
14] However, we make it clear that as has been observed by the learned Judges of the Division Bench while admitting the appeal on 24th of June, 2002 the respondent-State would always be at liberty to take such steps as are permissible in law, for directing the amendment of by-laws to the respondent no.2.
JUDGE JUDGE
Ambulkar
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