Kerala High Court
The Mulloor Rural Co-Operative Society ... vs The State Of Kerala on 3 April, 2009
Author: P.N.Ravindran
Bench: C.N.Ramachandran Nair, P.N.Ravindran
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR.JUSTICE C.N.RAMACHANDRAN NAIR
THE HONOURABLE MR.JUSTICE B.P.RAY
&
THE HONOURABLE MR.JUSTICE P.N.RAVINDRAN
TUESDAY, THE 10TH DAY OF APRIL 2012/21ST CHAITHRA 1934
WA.No. 1688 of 2009 ( )
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AGAINST THE JUDGMENT IN WPC.3351/2008 DATED 03-04-2009
APPELLANT/PETITIONER:
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1. THE MULLOOR RURAL CO-OPERATIVE SOCIETY LTD.
NO.T.1499, MULLOOR P.O., TRIVANDRUM,
REP. BY ITS SECRETARY.
BY ADV. SRI.K.B.PRADEEP
RESPONDENTS/RESPONDENTS:
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1. THE STATE OF KERALA,
REP. BY THE CHIEF SECRETARY TO GOVERNMENT,
SECRETARIAT, TRIVANDRUM.
2. THE STATE INFORMATION COMMISSION FOR KERALA,
PUNNEN ROAD, TRIVANDRUM.
3. B.SUNIL KUMAR, DEEPAM LAKZHMI HOUSE,
H.NO.100, WARD NO.3, VIZHINJAM STREET, TRIVANDRUM.
R1 BY SR. G.P. SRI.D.SOMASUNDARAM
R2 BY ADV. SRI.M.AJAY, SC, STATE INFORMATION COMMN
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 09.02.2012,
THE COURT ON 10-04-2012 DELIVERED THE FOLLOWING:
C.R.
C.N.RAMACHANDRAN NAIR,
B.P.RAY &
P.N.RAVINDRAN, JJ.
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Writ Appeal No.1688 of 2009
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Dated this the 10th day of April, 2012.
JUDGMENT
Ramachandran Nair, J.
This Writ Appeal is filed against judgment of the learned Single Judge holding that a Co-operative Society registered under the Kerala Co-operative Societies Act (hereinafter called "the KCS Act") answers the definition of "public authority" as defined under Section 2(h) of the Right to Information Act, 2005 (hereinafter called "the RTI Act") and hence the Registrar of Co-operative Societies was within his powers in issuing the order impugned in the Writ Petition directing all societies to constitute authorities under the RTI Act for furnishing information sought about societies. When the Writ Appeal filed by the appellant- society against the judgment of the learned Single Judge came up before the Division Bench of two of us(CNR & BPR (JJ)), we were referred to another Division Bench decision of this court in THALAPPALAM SERVICE CO-OPERATIVE BANK LTD. Vs. W.A.1688/2009 2 UNION OF INDIA AND OTHERS reported in 2009(3) KHC 901 wherein that Bench took the view that a society would become a "public authority" within the meaning of Section 2(h) of the RTI Act only if such society is "substantially financed by the Government". However, after going through the said judgment and after hearing the matter, the Division Bench doubted the correctness of the above judgment and vide order dated 24.3.2011 the issue was referred for consideration by the Full Bench and hence this appeal is posted before us.
2. We notice that in the judgment under appeal the learned Single Judge after elaborately considering the scheme of constitution, registration and management of co-operative societies under the KCS Act and the Rules made thereunder felt that the all pervasive control and supervision the Government and statutory authorities particularly, the Registrar and Joint Registrar of Co-operative Societies exercise over the societies and the rights of the members and the public and the corresponding obligations of the societies and it's Managing Committee and employees necessarily bring every society under the definition of "public authority" under Section 2(h) of the RTI Act. Consequently W.A.1688/2009 3 the Circular issued by the Registrar of Co-operative Societies Act directing societies to implement the provision of the RTI Act was upheld. It is against this judgment the Appellant-society has filed this Writ Appeal contending that societies registered under the KCS Act are not "public authorities" as defined under the RTI Act. We have heard counsel appearing for the Appellant, Senior Government Pleader for the first respondent, Standing Counsel appearing for the second respondent and also counsel appearing for the third respondent. Since the question to be considered is the meaning and scope of "public authority" as well as "information" as defined under the RTI Act, we extract hereunder the relevant definition clauses:
S.2(f) "Information" means any material in any form, including records, documents, memos, e-mails, opinions, advices, press releases, circulars, orders, log books, contracts, reports, papers, samples, models, data material held in any electronic form and information relating to any private body which can be accessed by a public authority under any other law for the time being in force."
S.2(h) "public authority" means any authority or body or institution of self-government established or constituted-
(a) by or under the Constitution;
(b) by any other law made by Parliament;
(c) by any other law made by State Legislature;
(d) by notification issued or order made by the appropriate Government, W.A.1688/2009 4 and includes any-
(i) body owned, controlled or substantially financed;
(ii) non-Government organisation substantially financed, directly or indirectly by funds provided by the appropriate Government."
Before proceeding to consider the question raised herein, we have to first examine the nature and functioning of the co-operative societies under the KCS Act and the object and purpose of the RTI Act. Co- operative societies are not institutions established under the KCS Act and, therefore, are not statutory authorities, though all Co-operative societies are required to be registered under the KCS Act. Under Section 27 of the KCS Act, the final authority of a society vests in the general body of it's members. Every society is managed by the managing committee constituted in terms of the byelaws of the society as provided under Section 28 of the KCS Act. Right from registration onwards every society is subject to strict control by the statutory authorities like the Registrar, Joint Registrar and also the Government. Further, the society's accounts are to be compulsorily audited by statutory audit team constituted under the KCS Act. Sections 65, 66 W.A.1688/2009 5 and 68 of the said Act authorise enquiry, inspection and even levy of surcharge on erring managing committee members and employees of any society, if they are involved in misappropriation or mismanagement of the society. Section 32 of the KCS Act authorises the Registrar to supersede the managing committee of a society for mismanagement and to appoint an Administrator to manage the affairs of the society. In short, there is all-pervading control over society by the statutory authorities including the Government. The functioning of the society as already stated, is absolutely democratic in as much as the ultimate power is vested in the general body and the members elect the managing committee to manage the affairs of the society. The society is constituted with members' funds, mainly as subscription towards share capital and even deposits from public are accepted by the societies engaged in banking business. In other words, absolute transparency about the affairs of the societies is the fundamental requirement for societies to run in compliance with the statutory provisions. It is worthwhile to note the Constitution (Ninety-seventh Amendment) Act, 2011, by which right to form a co-operative society is declared as a fundamental right under Article 19(1)(c) of the W.A.1688/2009 6 Constitution and under Directive Principles Article 43B is introduced providing that "The State shall endeavour to promote voluntary formation, autonomous functioning, democratic control and professional management of co-operative societies." The importance of the co-operative movement in the development of the nation is not only recognised but is made a basic feature of the Constitution. The objective of the RTI Act as is evident from it's preamble itself is to promote transparency and accountability in the working of every public authorities. Keeping this in our mind, we now proceed to consider the question as to whether the societies registered under the KCS Act are covered by the provisions of the RTI Act.
3. What we notice from the definition clause of "information" itself is that information that is required to be supplied under the RTI Act can even be information relating to any "private body" which can be accessed by a "public authority" under any other law for the time being in force. So far as the first part of definition of "public authority" under Section 2(h) of the RTI Act is concerned, every statutory authority namely, Registrar, Joint Registrar etc. under the KCS Act made by the State Legislature, which comes within the scope W.A.1688/2009 7 of clause (c) of Section 2(h) of the RTI Act, obviously answers the description of "public authority". When these authorities constituted under the KCS Act answer the description of "public authorities", they are bound to furnish information to any applicant if it is within their knowledge or otherwise, they should in exercise of their statutory powers access such information from the society and furnish it to the applicant. Therefore, even if society by itself does not answer the description of "public authority", the statutory authorities under the KCS Act being public authorities within the meaning of clause (c) of Section 2(h), are bound to furnish information after accessing the same from the co-operative society concerned.
4. The next question to be considered is whether a society registered under the KCS Act by itself is a "public authority" requiring the society to discharge duties under the RTI Act like appointing Information Officer and other statutory authorities to furnish information in terms of the provisions contemplated under the RTI Act. The appellant has relied on decision of the Division Bench referred above, the correctness of which itself is being considered by us. Another decision relied on by the appellant is that of the Karnataka W.A.1688/2009 8 High Court rendered by a Single Judge in S.S.ANGADI Vs. STATE CHIEF INFORMATION COMMISSIONER, BANGALORE reported in AIR 2008 KARNATAKA 149 wherein the Single Judge of that court held that the society registered under the Karnataka Co-operative Societies Act is not a "public authority" within the meaning of the RTI Act. On going through this judgment, what we notice is that the learned Judge has not referred to the provisions of the Karnataka Co- operative Societies Act either on the control of the statutory authorities over the societies or the rights of members and public and the obligations of the society and it's managing committee and employees. In any case going by the provisions of the KCS Act, we are of the view that unless information pertaining to the society is not made available to members or others dealing with the society, many of the provisions of the KCS Act cannot be implemented and the obscure management of any society may lead to it's destruction to the detriment of the interests of the members of the society and public at large. We are unable to accept the finding of the learned Single Judge of the Karnataka High Court in the above decision that the affairs of the society are limited to those few persons who are the members. Even though several W.A.1688/2009 9 decisions of the Supreme Court were cited by the appellant pertaining to right to privacy, we do not think these decisions have any significance when we consider the scope of a modern legislation intended to achieve complete transparency in all democratic institutions which is essentially made to prevent mismanagement and misapplication of public funds to the detriment of interest of the members and the public at large. It may be noticed that the RTI Act is an improvement of the previous legislation on the subject namely, Freedom of Information Act, 2002, which was substituted and repealed by the present Act. Under the previous Act, information was given only a very limited scope pertaining to the administration and operation of public authorities. A major change introduced by the new Act is to cover even information relating to private bodies which can be accessed by statutory authorities. Therefore, keeping in mind the transformation of law and it's ultimate object, i.e. to achieve transparency and accountability with regard to affairs of a public body, we have to give a liberal construction to "public authority" contained in the RTI Act which alone can advance the objective of the Act. We feel this definition clause in the RTI Act is not happily worded in as much W.A.1688/2009 10 as it is not completely free from doubt. However, we feel the inclusive definition in the second part of the definition of "public authority" contained under Section 2(h) of the RTI Act takes in any body directly or indirectly controlled by appropriate Government. We have already stated and the learned Single Judge has considered in detail the various powers exercised by statutory authorities in regard to registration, audit and other control of the societies by the Government, the Registrar and other statutory authorities constituted under the Act. It may be noticed that Section 32 authorises the Registrar to supersede management of societies on finding of irregularity or mismanagement and to appoint Administrator. Government enjoys revisional power under Section 87 against orders of the Registrar. In fact Chapter VI of the KCS Act provides for Government funding of co-operative societies. We are of the view that the control exercised by the Government and the statutory authorities bring the societies within the inclusive clause (i) of the definition clause of "public authority" under Section 2(h) of the RTI Act. It is also worthwhile to note the observation of the Supreme Court in S.P.GUPTA Vs. UNION OF INDIA reported in (1981) Suppl. SCC 87 wherein the court observed W.A.1688/2009 11 that "the concept of an open government is the direct emanation from the right to know which seems to be implicit in the right of free speech and expression guaranteed under Article 19(1)(a)" and "therefore, disclosure of information in regard to the functioning of Government must be the rule and secrecy an exception......". The court emphasised that no democratic government can survive without accountability and the basic postulate of accountability is that the people should have information about the functioning of the Government. In our view, the principle laid down by the Supreme Court squarely applies to every co-operative society registered under the KCS Act because societies are run following the fundamental principle of democracy that is, through decision by majority that too, through elections. So much so, in our view, it is fundamental that every member of the society, every depositor and every one interested in the affairs of the society are entitled to get all information relating to the society which is possible only if RTI Act is implemented against co-operative societies. However, it may be noticed that sufficient safeguard is made in Section 8 of the RTI Act which prohibits furnishing of certain items of information on which statutory immunity is provided thereunder for W.A.1688/2009 12 obvious reasons. Subject to the exceptions contained in this Section, any other information relating to a co-operative society should be made available to the public on application is what is contemplated under the RTI Act. We are afraid the attitude of the managing committee of a society to refuse to furnish information relating to the society itself should be a matter of serious concern by the Joint Registrar because people tend to cover up only wrong things and not things which are properly done. We have noticed that the completion of statutory audit of societies is delayed by four to five years and most of the managing committees escape from being caught for mismanagement only because of delay in auditing, detection of irregularities and delay in initiation of surcharge proceedings thereafter. We are of the view that atleast vigilant members and the public by obtaining information through RTI Act will be able to detect and prevent mismanagement in time. We, therefore, feel that the RTI Act will certainly help as a protection against mismanagement of the societies by the managing committee and by society employees. We, therefore, answer the question referred by the Division Bench by holding that Co-operative Societies registered under the KCS Act are "public authorities" within the W.A.1688/2009 13 meaning of Section 2(h) of the RTI Act. Since no other issue is raised before us, we dismiss the Writ Appeal by confirming judgment of the learned Single Judge declaring the applicability of the RTI Act to Co- operative Societies and by upholding the Circular issued by the Registrar of Co-operative Societies.
C.N.RAMACHANDRAN NAIR Judge B.P.RAY Judge P.N.RAVINDRAN Judge pms