Bombay High Court
Shankarlal Govindram Gunwani vs The State Of Maharashtra on 25 June, 2010
Author: R.K. Deshpande
Bench: R.K. Deshpande
1
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
APPELLATE SIDE, BENCH AT AURANGABAD
WRIT PETITION NO. 3045 OF 2009
1. Shankarlal Govindram Gunwani,
Age 55 yrs., Occu. Business,
R/o. Sindhi Colony, Jalna Road,
Aurangabad.
2. Ranjeetsing Govindsing Gulati,
Age 55 yrs., Occu. Business,
R/o. Osmanpura, Near City Bus Stop,
Aurangabad 431 005.
3.
Gangadhar Lekhrajmal Kariya,
Age 45 yrs., Occu. Business,
R/o. Sindhi Colony, Jalna Road,
Aurangabad.
4. Prakashchand Likaram Kingar,
Age 60 yrs., Occu. Business,
R/o. Sindhi Colony, Jalna Road,
Aurangabad.
5. Srichand Hemandas Jagiasi,
Age 55 yrs., Occu. Advocate,
R/o. Sindhi Colony, Jalna Road,
Aurangabad.
6. Mrs. Harjeet Srichand Jagiasi,
Age 53 yrs., Occu. Service,
R/o. Sindhi Colony, Jalna Road,
Aurangabad.
7. Mrs. Bharti Murlidhar Pahelwani,
Age 55 yrs., Occu. Household,
R/o. Sindhi Colony, Jalna Road,
Aurangabad.
8. Arjundas Motiram Datwani,
Age 55 yrs., Occu. Business,
R/o. Sindhi Colony, Jalna Road,
Aurangabad.
9. Avatarsing Harbanssing Chhabada,
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Age 58 yrs., Occu. Business,
R/o. Sindhi Colony, Jalna Raod,
Aurangabad.
10. Swaransing Arjunsingh Hura,
Age 60 yrs., Occu. Business,
R/o. Sindhi Colony, Jalna Road,
Aurangabad.
11. Veerpalsing Yograjsing Malhotra,
Age 50 yrs., Occu. Business,
R/o. Sindhi Colony, Jalna Road,
Aurangabad.
12. Mahindarsing Variyamsing Saluja,
Age 48 yrs., Occu. Business,
R/o. Sindhi Colony, Jalna Road,
Aurangabad. ....Petitioners.
Versus
1. The State of Maharashtra,
Through the Secretary,
Department of Co-operation,
Mantralaya, Mumbai.
2. The Divisional Joint Registrar,
Co-operative Societies,
Aurangabad.
3. The Taluka Deputy Registrar,
Co-operative Societies,
Aurangabad.
4. Shri. S.B. Sontakke,
Head Clerk & Co-operative Officer,
Grade-2 & The Administrator
Appointed for Shri. Shivaji Sindhi,
Sahakari Graha Nirman Sanstha Ltd.,
Sindhi Colony, Jalna Road, Aurangabad.
5. Shri. Nathumal Remaldas Nathani,
Age Major, Occu. Business,
R/o. Sindhi Bazar, Jalna,
Tq. & Dist. Jalna.
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3
6. Secretary,
Aurangabad District Co-operative Housing
Societies Federation Ltd., Aurangabad,
Nutan Colony, Aurangabad. ....Respondents.
Shri. V.D. Hon, Advocate for petitioners.
Shri. T.S. Lodhe, A.G.P. for respondent Nos. 1 to 3.
Shri. V.D. Salunke, Advocate for respondent No. 5.
Shri. S.S. Choudhari, Advocate for respondent No. 6.
CORAM : R.K. DESHPANDE, J.
DATE OF RESERVING JUDGMENT :
ig 16th th June 2010.
DATE OF PRONOUNCEMENT :
25th June 2010.
ORAL JUDGMENT :
1. This writ petition is preferred by the 12 members of the Management Committee of Shri. Shivaji Sindhi Co-operative Housing Society Ltd., Jalna Road, Aurangabad which is registered under the Maharashtra Co-operative Housing Societies Act, 1960 (hereinafter referred to as 'the said Act'). It challenges the order dated 6.4.2009 passed by the respondent No. 3 - The Taluka Deputy Registrar, Co-
operative Societies, superseding the Management Committee of the said Society, in exercise of his powers under Section 78 (1)of the said Act. It further challenges the order dated 30.4.2009, passed by the respondent No. 2 - The Divisional Joint Registrar, Co-operative Societies, Aurangabad, dismissing the appeal preferred by the petitioners under Section 152 of the said Act, challenging the order dated 6.4.2009 passed ::: Downloaded on - 09/06/2013 16:03:43 ::: 4 under Section 78 (1) of the said Act by the respondent No. 3.
2. The facts giving rise to the controversy involved in the case are as stated below :-
The stand of the respondent No. 3 - The Taluka Deputy Registrar, Co-operative Societies, Aurangabad is that as per the complaint made by one Shri. Kishanchand Tanwani, M.L.C. to the Hon'ble Minister Shri. Patangrao Kadam, Department of Co-operation, Maharashtra State and also by one Shri. Rajesh Laxmandas Paswani and 21 others, a notice under Section 80 (1) of the Maharashtra Co-operative Societies Act, 1960 ( hereinafter referred to as "the said Act") was issued by the Tahsildar, Aurangabad for production of the records of the Society in respect of day-to-day affairs. The Special Auditor, Class II, Co-operative Societies (Flying Squad) Aurangabad, was appointed as an Inquiry Officer and he submitted two reports dated 22.4.2008 and 9.2.2009, stating that the Members of the Society are not cooperating and purposefully avoiding to submit the record for inquiry. Hence, it was stated that it was impossible to submit the report to the Government.
3. The Society failed to produce the record and therefore, notice under Section 78 (1) of the said Act was issued on 12.2.2009, to all the Members of the Managing Committee of the Society, for furnishing an explanation in respect of the charges levelled against them. The charges levelled, included the charge of misappropriation of huge amount and ::: Downloaded on - 09/06/2013 16:03:43 ::: 5 non submission of bond, as contemplated by Rule 58 (A) of the Rules, framed under the said Act. The petitioners, who are the Members of the Managing Committee of the said Society, submitted their explanation dated 25.5.2009, to the said show cause notice. All the charges levelled were denied. In respect of non submission of bond, the stand was that it was furnished within stipulated period. A photocopy of such bond, dated 5.6.2008, in form No. 20 signed by all the petitioners, was also furnished. It was stated that the members of the Society, took the charge of the Society on 1.6.2008.
4. The hearing was conducted by the respondent No. 3 on 27.2.2009, 9.3.2009, 16.3.2009, 17.3.2009, 24.3.2009, 30.3.2009 and 20.4.2009. The respondent No. 3 - the Taluka Deputy Registrar, by his order dated 6.4.2009, passed under Section 78 (1) of the said Act, held that all the charges were proved. In respect of the charge of non submission of bond, it was held that after the elections of the Members of the Managing Committee, a bond was required to be submitted within a period of 15 days, as per Rule 58 (A) of the said Rules. However, the bond was not submitted and hence, there was non compliance of the provision of Rule 58 (A) of the said Rules. It was held that the explanation furnished by the petitioners cannot be accepted. Accordingly, the respondent No. 3 passed an order under Section 78 (1) of the said Act on 6.4.2009, superseding the Managing Committee of the Society and appointing the respondent No. 4 Shri. S.B. Sontakke, as an administrator ::: Downloaded on - 09/06/2013 16:03:43 ::: 6 over the Society, for a period of six months or till further orders.
5. All the 12 petitioners preferred an appeal No. 13/2009 under Section 152 of the said Act, before the respondent No. 2 - the Divisional Joint Registrar, Co-operative Societies, Aurangabad, challenging the order dated 6.4.2009 passed under Section 78 (1) of the said Act. The Divisional Joint Registrar, without entering into the merits of other charges which were held to be proved, confirmed the order passed under Section 78 (1) of the said Act. However, while confirming the order, it was held that the Managing Committee was constituted on 1st of July 2008, as per the provisions of section 73 FF (1) (AB) of the said Act.
The bond was required to be submitted individually, by each Member of the Committee, within a period of 15 days. However, it was held that separate bonds were not executed by each of the Member of the Managing Committee and hence, there was failure to comply with the mandatory requirement. According to the learned Divisional Joint Registrar, this ground itself was enough to confirm the order passed under Section 78 (1) of the said Act. The appeal filed by the petitioners was, therefore, dismissed by an order dated 30/04/2009. Hence, the instant petition is filed, challenging both the orders passed by the authorities below.
6. The only point which is being considered in the instant writ ::: Downloaded on - 09/06/2013 16:03:43 ::: 7 petition is, regarding non compliance of Section 73 (1AB) and Rule 58 (A) of the Rules framed under the said Act., regarding non submission of bond in form No. 20, as it is only on this ground, that the respondent No. 2 - the Divisional Joint Registrar has maintained the order passed on 6.4.2008 under Section 78 (1) of the said Act. If this point is answered in favour of petitioners, then the matter will have to be remanded back to the respondent No. 2 - the Divisional Joint Registrar, for deciding other points on which the findings are recorded by the respondent No. 3 - in the order dated 6.4.2008.
7. The contention of Shri. Hon, the learned counsel for the petitioners is that the period of 15 days as contemplated by section 73 (1AB) of the said Act has to be counted with effect from 1.6.2008, when the first meeting of the elected Members of the Managing Committee was held. According to him, the members of the Managing Committee have assumed the office on 1.6.2008 and out of 15 Members of the Managing Committee, 13 have executed and submitted the bond on 5.6.2008 in form No. 20. He therefore, submits that the Members of the Managing Committee have thus, executed the bond within a period of 15 days, as contemplated by section 73 (1AB) and hence, it cannot be said that there was failure to execute the bond within the stipulated period.
8. As against this Shri. V.D. Salunke, the learned counsel appearing ::: Downloaded on - 09/06/2013 16:03:43 ::: 8 for respondent No. 5, whose arguments are adopted by the learned counsel appearing for other respondents, does not dispute that the bond was executed and submitted by the petitioners on 5.6.2008. He has however, urged that the Members of the Managing Committee assumes the charge on the date of publication of their names by the Registrar on notice board, as contemplated by Section 73 (3) (a) of the said Act. Such notification was undisputedly issued on 1.7.2008 and thereafter, none of the Members of the Committee have executed any bond as contemplated by Section 73 (1AB) of the said Act and hence, the Members of the said Committee, deemed to have vacated their office, upon expiry of 15 days period from 1.7.2008 i.e. on 15.7.2008. Thus, the learned counsel appearing for the respondents supports the findings recorded in the impugned order passed by the respondent Nos. 2 and 3.
9. It is also not in dispute that common/single bond in form No. 20 has been signed and submitted by all the petitioners. Shri. Hon, the learned counsel for the petitioners submits that this is full compliance of provisions of Section 73 (1AB) read with Rule 58 (A) and form No. 20. As against this, Shri. V.D. Salunke and other learned counsel for the respondents have urged that the said provision contemplate separate bonds to be signed/executed and submitted by each of the Member of the Managing Committee and signing/executing and submitting single bond by all the Members of the Committee, is not the compliance of the said provisions. According to them, the object is to cast the responsibility ::: Downloaded on - 09/06/2013 16:03:43 ::: 9 for the decisions of the Committee, upon each Member of the Committee and hence, keeping in view the object, there was non compliance of said provision, when admittedly the single bond is signed by all the petitioners.
10. In the light of the rival contentions raised by the learned counsel for the parties, the first question which may arise is, as to when the Members of the Managing Committee of the Society assume the office in terms of Section 73 (1AB) of the said Act. Whether they assume the office on the date of declaration of result of Members of the Managing Committee on 15.4.2008 or on the date of holding of the first meeting of the Managing Committee on 1.6.2008 or on the date of publication of their names on the notice board by the Registrar on 1.7.2008. If it is held that they assume the office on the date of holding of the first meeting of the Managing Committee on 1.6.2008, then there is compliance to the extent of submission of bond within a period of 15 days, as contemplated by Section 73 (1AB) and Rule 58(A). The next question would arise, as to whether signing/executing and submission of single bond in form No. 20 under Rule 58 (A), of the said Rules by all the petitioners, complies with the requirement of law or each Member of the Managing Committee is required to sign/execute and submit a separate bond in form No. 20. Apart from this, the question may also arise, as to whether the requirement of section 73 (1AB) read with Rule 58 (A) of the Rules framed thereunder is mandatory and whether substantial ::: Downloaded on - 09/06/2013 16:03:43 ::: 10 compliance with the said requirement would exonerate the Members of the Managing Committee from the consequences of vacating the office, as contemplated by section 73 (1AB) of the said Act. Similarly, even if it is assumed that the period 15 days is to be counted w.e.f. 01/06/2008 and that each of the Member of the Committee is required to sign and submit separate bond in form No. 20, then whether such a defect can be removed by submitting separate bonds, subsequently, particularly when a single bond signed by all the Members is already submitted.
11. Section 78(1) of the said Act requires the Registrar to provide the Committee or its member as the case may be, an opportunity of stating its or his objection, if any, to the charge or the charges in respect of which, its or his removal is proposed. The action of removal either of the Committee or any of its member, is a drastic action which makes the member so removed ineligible to be re-elected, re-
appointed, re-nominated or re-coopted as a member of the Committee, till the expiry of the period of next one full term of the committee, from the date of his removal or till such lesser period as may be laid down under the provisions of Section 73 FFF or 144 E, as the case may be. In a way, it is a stigmatic removal and hence an inbuilt safeguard of prior consultation with federal society to which such society is affiliated, has been provided for. The requirement under Section 78(1), is to provide an effective opportunity to defend the proceedings and it is mandatory. In view of this, it is implicit requirement of Section 78(1) of the said Act, to ::: Downloaded on - 09/06/2013 16:03:43 ::: 11 state all material facts and particulars as well as the provisions of law, if any, to spelt out or constitute a specific charge or charges on which the Committee, or its member is sought to be removed. It is the duty and obligation of the Registrar to supply such information in the show cause notice under Section 78(1) of the said Act. It is not expected that the person or persons charged under Section 78(1) to search or make an inquiry to find out the material facts and particulars of charge and the law applied, to first understand the nature of charge and then to furnish the explanation. Failure to perform such duty or to discharge the obligation, to spelt out or constitute a specific and definite charge of removal, would vitiate the findings, not only on the ground of breach of the principles of natural justice but also on the ground that the action is in breach of mandatory requirement of providing effective opportunity to furnish explanation or raise an objection as contemplated by Section 78(1) itself.
12. After going through the contents of the show cause notice under Section 78(1), dated 12.2.2009, the reply to the said notice submitted on 25.5.2009 by the petitioners, the findings recorded in the order dated 6.4.2009 passed by the respondent No. 3 - the Taluka Deputy Registrar under Section 78 (1) of the said Act and the findings recorded by the respondent No. 2 - the Divisional Joint Registrar in his order dated 30.4.2009, I am of the view that none of the aforesaid contentions raised by the learned counsel for the parties nor any questions which may ::: Downloaded on - 09/06/2013 16:03:43 ::: 12 arise, as are reproduced in early para, can be decided in the instant writ petition, for the reasons that from the objections raised by the learned counsel for the parties, in respect of the pleadings of material facts, it is apparent that the charge in question levelled in the show cause notice, in respect of non submission of bond, is as vague and unspecific, as it could be. So also the reply filed by the petitioners - the members of the Managing Committee. The findings recorded by the respondent No. 3 -
Taluka Deputy Registrar in his order under Section 78 (1), are not supported by the pleadings of material facts in the show cause notice under Section 78 (1) issued on 12.2.2009. Similar is the case in respect of the finding recorded by the appellate authority in revision under Section 152 of the said Act.
13. The charge under show cause notice in respect of non compliance of Rule 58 (A) is that the bond as contemplated by Rule 58 (A) is not submitted. Beyond this, no particulars are given, the material facts to constitute the charge are not stated and no case is made out. The petitioners have replied to the said charge by saying that the bond is submitted as required by Rule 58 (A). A copy of bond signed and submitted on 05/06/2008, in form No. 20 was forwarded. In the opening para of the reply, although the date of taking over charge is specified as 1.6.2008, it is not stated that the period of 15 days as contemplated by section 78 (1AB), is to be counted from 1.6.2008. Be that as it may, the show cause notice, nowhere stipulates that the petitioners had assumed ::: Downloaded on - 09/06/2013 16:03:43 ::: 13 the office on the date of election i.e. 15.4.2008. It is not the charge that within 15 days i.e. on or before 30/04/2008, the petitioners were required to furnish the bond, as required by Rule 58 (A) and they have failed to comply with it. However, the finding is recorded in the order passed under Section 78 (1) of the said Act that the petitioners have not submitted such bond within a period of 15 days, as provided by Rule 58(A). Hence, the order under Section 78(1),superseding the Managing Committee cannot, therefore, be sustained, in view of the fact that it failed to provide effective opportunity to the petitioners to put forth their case/defense.
14. The Divisional Joint Registrar in his order dated 30/04/2009, has recorded a finding that the Managing Committee was constituted on 01/07/2008, as per the provisions of Section 73(FF)(1AB) of the said Act. It was further held that the bond was required to be submitted individually, by each member of the committee within a period of 15 days, however such separate bonds were not submitted and hence, there was failure to comply with the mandatory requirement.
The provision referred to in the order, is wrong. The material fact as stated in the order that the Managing Committee was constituted on 01/07/2008 as per the provisions of Section 73(1AB) of the said Act, was not stated in the show cause notice. It was also not the allegation in the show cause notice that such bond was required to be submitted within a period of 15 days the date of constitution of committee from 01/07/2008 ::: Downloaded on - 09/06/2013 16:03:43 ::: 14 i.e. on or before 15/07/2008. It was also not the fact contained / alleged in the show cause notice, that each member of the Managing Committee was required to execute and submit separate bond in form No. 20, within a period of 15 days. The petitioners had therefore, no opportunity, either to deny or defend the fact that the Managing Committee was constituted on 01/07/2008 and it is from that date, the period of 15 days is required to be counted in terms of Section 73(1AB) of the said Act. The petitioners were also denied opportunity to furnish an explanation, in respect of the finding that each and every member of the Managing Committee was required to sign and submit a separate bond in the form No. 20 under Rule 58(A) of the Rules. Thus, the finding recorded by the appellate authority is not supported by the charge levelled in the show cause notice.
15. The question whether the Managing Committee was constituted on the date of declaration of result i.e. 15/04/2008 or on 01/07/2008 i.e. the date of publication of names of elected candidates on notice board, as required by Section 73(3) (a) of the said Act, is a mixed question of law and facts. Similarly, whether the members of the Managing Committee assumed the charge of the office, as contemplated by Sec. 73(1AB) of the said Act on the date of declaration of result i.e. 15/04/2008 or on the date of holding of the first meeting of the Managing Committee on 01/06/2008 or on the date of publication of names of elected members on the notice board by the Registrar on ::: Downloaded on - 09/06/2013 16:03:43 ::: 15 01/07/2008, is also a mixed question of law and facts to be judged, in the light of the provisions of the said Act, Rules and the bye laws of the society. The bye laws of the society prescribed the term of the Managing Committee for a period of 5 years, which is to be counted from the date on which the members of the Managing Committee of the society assume the charge. Neither the Act, nor the Rules framed under the said Act prescribes, the term of the office of the members of the Managing Committee, nor does it prescribe the date on which the term of the Managing Committee shall commence.
16. In view of above, it is clear that show cause notice issued under Section 78(1) of the said Act, dated 12/02/2009 has failed to state all such material facts and particulars to spelt out or constitute the charge of non submission of bond as contemplated by section 73(1AB) and Rule 58(A) of the said Rules. Hence, the said charge is liable to be set aside on the ground of denial of principles of natural justice and an effective opportunity to defend the charge to the petitioners, as contemplated by Section 78(1) of the said Act.
17. In the result, the order passed by the Divisional Joint Registrar, Cooperative Societies on 30/04/2009, confirming the order passed on 06/042009 by the Taluka Deputy Registrar under Section 78(1) of the said Act is quashed and set aside. The matter is remitted back to the Divisional Joint Registrar, for deciding the appeal, challenging the ::: Downloaded on - 09/06/2013 16:03:43 ::: 16 findings and the order passed under Section 78(1) of the said Act, in respect of the charges other than the charge of non submission of bond, as contemplated by Section 73(1AB) and Rule 58-A of the said Rules.
Rule is made absolute in these terms. No order as to costs. Needless to state that the Divisional Registrar shall pass an order in accordance with law after granting hearing to the petitioners.
ig [ R.K. DESHPANDE, J. ]
ssc/SDM*/WP3045.09
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