Karnataka High Court
M. Sanjeeva And Anr. vs State Of Karnataka, Rep. By Secretary, ... on 10 September, 2003
Equivalent citations: ILR2003KAR4867
Author: Mohan Shantanagoudar
Bench: Mohan Shantanagoudar
JUDGMENT Jain, C.J.
1. These Writ Appeals are filed against the common order dated 24.7.2003 passed in W.P.N. 6058/2003 wherein the learned Single Judge has not interfered with Notification dated 26.12.2002 (Annexure-A), issued by the 1st respondent. As in both the appeals, common questions of law and fact are involved, they are taken up together.
2. It is stated that the 2nd respondent is a society governed by Multi-State Co-operative Societies Act, 2002 (Central Act 39 of 2002) (for short "the 2002 Act'). Earlier the Act of 1984 was in force and it was replaced by the 2002 Act. The management of the 2nd respondent -Society is vested with the Board of Directors. The appellant - petitioner was elected as a member of the Board of Directors vide notification dated 22.01.2003 for a period of 3 years. Being aggrieved by the issuance of notification dated 26.12.2002, issued by the State Government, the appellant - petitioner filed the above Writ Petition challenging the nomination of the 3rd and the 4th respondents, made by the Government, to the 2nd respondent -Society. The learned Single Judge, as stated, while not interfering with the impugned notification dismissed the Writ Petition. Hence, these writ appeals.
3. Sri Acharya, learned Counsel for the appellants submits that while Rule 31(2) of the Multi-State Co-operative Societies (Registration, Membership, etc.) Rules, 1985, which starts with a non-obstante clause, provides for nomination of persons in excess of the limits prescribed in Rule 31(1), as per the present Section i.e., Section 48 of the Act of 2002, the State Government can nominate only specified number of persons to the Board. According to the learned Counsel, the learned Single Judge has not considered all these factors. He also submits that as per Section 41(3) of the 2002 Act, the Board shall consist of such number of Directors as specified in the Bye-laws, which is 19 in the present case, and if the reasoning of the learned Single Judge is accepted it would exceed the maximum number specified in the bye-laws. He further submits that the learned Single Judge erred in not appreciating the Judgment of the Kerala High Court in OP No. 2097 of 2003 (Y) (decided on 29.1.2003) in a proper perspective, and therefore, the notification dated 26.12.2002 is liable to the quashed and the order of the learned Single Judge is liable to be set aside.
4. On the other hand, Sri A.G. Holla, learned Senior Counsel for the 2nd respondent - Society, submits that by the earlier order dated 20.4.2000, C.D. Jayaram Gowda has been nominated as a member of the Board of Directors invoking Rule 31(2) of the Rules, and therefore, the argument that only one can be nominated is untenable. He further submits that as per Section 48 of the Act of 2002 the Government is empowered to nominate two persons, and exercising the same, the 3rd and 4th respondents have been nominated by issuing the impugned notification. He submits that the statute prevails over the bye-laws and the power conferred by the provisions of the Act can be exercised nominating the persons in excess of limit prescribed in the bye-laws, and therefore, the order of the learned Single Judge needs no interference.
5. Sri M.N. Seshadri, learned A.G.A. submits that the order of learned Single Judge needs no interference as neither there is any violation nor there is any inconsistency and the nomination of two persons is as per law. It is stated that in the present Act, the extra seat is omitted. He submits that the decision of the Kerala High Court (supra)is not applicable as the appointment of respondent -C.D. Jayaram Gowda is under Section 31(2) of the Act. The learned Government Advocate submits that there is no inconsistency and therefore the argument that when already one nominee is there and only one can be nominated and exceeding to two is bad, cannot be sustainable.
6. We have heard the learned Counsel for the parties and perused the material placed on record and the relevant Act and Rules.
7. The point for determination is whether power of nomination of State under Section 48 of 2002 Act is independent of and in addition to power of nomination under the Bye-laws of second respondent- Society?
8. A bare reading of Section 41(1) of the Act of 1984 makes it clear that the Central Government or the State Government has the right to nominate on the board such number of persons as may be prescribed and Section 41(2) of the Act states that the bye-laws of Multi-State Co-operative Society may provide for the nomination in excess of the limits prescribed under Section 41(1) of the Act. Rule 31(2) of the Rules also states that the bye-laws of a multi-state co-operative society may provide for the nomination by the Central or State Government of persons in excess of the limits referred to in Rule 31(1). Nomination can be made under Section 48 of the 2002 Act and it depends upon the equity share capital. If the share capital is less than 26%, the nomination will be one and if more it will be two and for share capital above 50% of the nomination will be three, provided such nominated persons shall not exceed 1/3 of the total number of persons nominated and shall hold the office during the pleasure of the Government.
9. According to the appellant-petitioner in view of provisions of Bye-laws and provisions of Section 48 of 2002 Act, number of persons nominated cannot exceed two and one of them should be a Senior Officer of the Co-operative Department as per Bye laws of second respondent and wherefore nomination of respondents 3 and 4 would exceed power of Govt. to nominate under Section 48 and nomination cannot be made in addition to number of members specified in the Bye law. However, according to respondents 1, 3 and 4 the power to nominate can be exercised independently both under Bye law and Section 48.
10. The M.S. Co-op. Societies Act and Rules 2002 have replaced M.S. Co-op, Societies Act, 1984 and Rules 1985. However orders passed under the provisions of the repealed Act and Rules are saved and wherefore Annexure -D Order dated 20.4.2002 nominating one person in exercise of power under Rule 31(2) of M.S. Co-op. S. Rules, 1985 is saved and that position is not disputed by the appellant- petitioner.
11. It is well settled that this Court cannot add or subtract words while construing the provisions of a Rule or a Statute and it has to be read with the plain and simple meaning. It is also settled that Rules cannot over-ride the act. But in the instant case nomination has been made under Rule 31(2) of Multi State Cooperative Societies (Registration, Membership, etc.) Rules, 1985, which has been saved under the new 2002 Act. In view of Section 48 of the Act, nomination can be made as per the share capital and accordingly in the instant case two persons can be nominated as per the share capital. Therefore the nomination of two persons vide order dated 22.1.2003 cannot be said to be bad, and the argument that only one person should be nominated as already the other person C.D. Jayaram Gowda has been nominated on 20.4.2000 under Rule 31(2) of the Rules, is not acceptable.
12. More so, a Full Bench of this Court in C.M. UDASI v. STATE OF KARNATAKA, 1994 (3) Kar. L.J. 5 found in similar circumstances that the State Government can exercise power under Section 53A of the act independently of the bye-laws and while considering the question with reference to provisions of Section 29, 53A of the Karnataka Co-operative Societies Act, 1959 and Bye-laws of the Society, has observed in relevant paras 16 and 17 as follows:
"16. Section 53A of the Act is a statutory power exercisable under the Act and it certainly prevails over any bye - law that may be framed. Merely because bye-laws have to be framed in conformity with the Act, it does not mean the same would control or whittle down the powers exercisable under the statute. Even in the absence of any power for nomination under the Act, if the bye-laws themselves provide for nominations, there can be no question of nominations being traced to the Act even though made under the bye-laws. Unless the bye-laws themselves provide that nominations could be made as provided under any one of the provisions of the Act and the bye-law itself is traceable to the Act under which nomination is made, there is no question of reading the bye-laws as controlling provisions of the Act. In such an event when the bye-laws do not refer to any provisions of the Act but merely make a provision for nomination, the State Government can exercise the powers under Section 53A of the Act independent of the bye-laws since the Act prevails over the bye-laws.
"17. The difficulty noticed in Konkodi Padmanabha's case, in our view, really does not arise for consideration. With great respect we must state that the Act controls bye-laws and not vice versa. Bye-laws are merely delegated legislation or subordinate legislation and can never override the Act. Whatever may be the number that may be fixed under the bye-laws, that number cannot circumscribe the number of nominations to be made in exercise of the powers under the Act. In that view of the matter, with respect, we disagree with the view that the nominations by the Government under Section 53A of the Act should be only to the extent of 1/3 of total number of Directors and such nomination is not in addition to the nominations provided under bye-law but excluding the nominations contained in bye-law, and further, the nominations could not be and should not have the effect of increasing the number of Board of Directors as fixed by the bye laws. On the other hand, we have come to the conclusion that it is permissible for the Government to make nominations to the extent of 1/3 of Board of Directors and such nominations are in addition to the nominations provided in the bye-laws unless the bye-laws themselves are traceable to any provisions of the Act, namely Section 29 or Section 53A of the Act. Further, the nominations could exceed the number of members on the Board of Directors fixed in the bye-laws."
13. The provisions of Sections 41 and 48 of 2002 Act correspond to Sections 32 and 41 of 1984 Act. Section 41 deals with Board of Directors and Sub-sections (3) states that the Board shall consist of such number of Directors as may be specified by bye law and that the maximum number of Directors shall not exceed 21. Section 48 provides for nominees of the State Government on Board. Bye laws of the Society though framed in pursuance of provisions of the Act, unlike Rules, cannot be held to be law or to have force of law and they govern internal management, business or administration of a Society as held by the Supreme Court in COOPERATIVE CENTRAL BANK LIMITED v. ADDITIONAL I.T.A.P., AIR 1970 SC 270 Nomination note Annexure-D has been made under Rule 31(2) of 1985 Rules pursuant to Section 32 of 1984 Act providing for Constitution of Board of Directors as per bye-laws. However, nomination under impugned order is made in exercise of the powers vested under Section 48 of the 2002 Act and in view of decision of Full Bench, the only finding that can be given is that power of nomination under Section 48 is independent of nominations made under bye-laws and contention of counsel for appellant- petitioner has to be accordingly rejected. Section 48 does not contemplate that one of the members nominated should be a Senior Officer of Co-operative Department and in view of Full Bench decision of this Court which applies to the present case also, the decision of Single Judge of Kerala High Court relied upon by petitioner is not helpful to him in the present case.
14. So also a person can invoke writ jurisdiction if there is violation or infringement of fundamental right or any right conferred by the Statute. In the instant case, the learned Counsel has not been able to show what right has been infringed. More so the private disputes cannot be resolved in writ jurisdiction. The learned Single Judge has not interfered as the petitioner - appellant has not been able to show what prejudice has been caused by the nomination of respondents 3 and 4. The appellant has not been able to satisfy us also and being an elected member, he cannot be affected by nomination of other members.
15. On consideration and inview of the above discussions, we find no error or illegality in the detailed order of learned Single Judge so as to call for interference in these appeals. Both the writ appeals are dismissed with no order as to costs.