Madras High Court
The Indian Medical Practitioners vs Dr.R.B.Ramamoorthy on 21 July, 2014
Author: R.Mala
Bench: R.Mala
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 21.07.2014 CORAM : THE HONOURABLE MS.JUSTICE R.MALA C.R.P(PD).Nos.3353 to 3355 of 2013 and M.P.Nos.1,1,1 of 2013 1.The Indian Medical Practitioners Co-operative Pharmacy and Stores (Multi-State Co-operative Society) Ltd. (Regn No.X-185) IMPCOPS No.34-37, Kalki Krishnamurthi Salai Thiruvanmiyur, Chennai-41. Rep. by its Secretary (In-charge) Dr.M.K.Thiyagarajan 2.Dr.S.Bose 3.Dr.M.K.Thiyagarajan .. Petitioners in all CRPs. Vs. 1.Dr.R.B.Ramamoorthy 2.Dr.P.Tamilmani 3.Dr.Murugesan 4.Dr.P.Thirumuruga Venkatesan 5.Dr.S.Sree Ramachandramurthy 6.Dr.D.Radhakrishnamurthi 7.Dr.Y.Srinivasalu 8.Dr.J.Sarulatha 9.Dr.Arun Baby 10.Dr.D.Velayudam 11.Dr.S.Senthilkumar 12.Dr.Y.Ramachandra Reddy 13.The Central Registrar of Co-operative Societies Krishi Bhawan, Dr.Rajendraprasad Road New Delhi 110 001. .. Respondents in all CRPs. Prayer:- C.R.P.(PD)Nos.3353 and 3354 of 2013 are filed under Article 227 of Constitution of India, against the fair and decreetal order dated 23.08.2013 made in I.A.Nos.12049 and 12050 of 2013 in O.S.No.4515 of 2013 on the file of the XII Assistant City Civil Court, Chennai. Prayer:- C.R.P.(PD)No.3355 of 2013 is filed under Article 227 of Constitution of India, to strike down the plaint in O.S.No.4515 of 2013 on the file of the XII Assistant City Civil Court, Chennai. For Petitioners : Mr.V.T.Gopalan, senior counsel for Mr.F.B.Benjamin George in all CRPs For R1 to R9 : Mr.NGR.Prasad, for Mr.M.Jayaraman in all CRPs. For R10 to R12 : Mr.M.Vijay Anand for M/S.Sree and Sun Associates in all CRPs. For R13 : Mr.C.Kanagaraj in all CRPs. C O M M O N O R D E R
C.R.P.(PD) No.3353 of 2013 is filed against the impugned order passed in I.A.No.12049 of 2013, dated 23.08.2013, restraining the defendants 1 to 6/revision petitioners herein and the respondents 10 to 12 from conducting the Board Meeting of IMPCOPS without serving notice to the plaintiffs/respondents 1 to 9.
2.C.R.P. (PD) No.3354 of 2013 is filed against I.A.No.12050 of 2013 dated 23.08.2013 under Section 151 of C.P.C. granting an order of stay of operation of the resolution bearing No.BDM No.3/2013-14, dated 19.07.2013 adopted in the Board Meeting of IMPCOPS held on 19.07.2013.
3.C.R.P. (PD) No.3355 of 2013 is filed for strike out the plaint in O.S.No.4515 of 2013.
4.The respondents 1 to 9 herein as the plaintiffs filed the suit in O.S.No.4515 of 2013 for the following reliefs:
a) Declaring that the resolution dated 19.07.2013 passed by the defendants 1 to 6 disqualifying the plaintiffs as Directors of IMPCOPS as null and void;
b)Granting permanent injunction restraining the defendants 1 to 6 from preventing the plaintiffs from taking part in the Board Meetings and Management of IMPCOPS;
c)To grant a mandatory injunction directing seventh defendant to intervene, investigate and take immediate steps to set right the administration of the 1st defendant society and for other reliefs. The revision petitioners and the respondents 10 to 13 herein are defendants in the suit. At the time of filing the suit, the plaintiffs have also filed applications in I.A.Nos.12049 and 12050 of 2013 granting interim injunction restraining the respondents 1 to 6 from conducting the Board Meeting of IMPCOPS without serving notice to the plaintiffs and granting interim stay of operation of the resolution dated 19.07.2013 adopted in the Board Meeting of IMPCOPS held on 19.07.2013 respectively. The trial Court granted interim orders, against which, the present revision petitions are preferred by the revision petitioners/defendants 1, 2 and 4.
5.Mr.V.T.Gopalan, the learned senior counsel for the revision petitioners has raised the following points for consideration:
(i) The respondents 1 to 9 herein as the plaintiffs filed a suit for declaration before the City Civil Court, Chennai, which has no jurisdiction and the same is frivolous and abuse of process of the Court. Hence, the plaint to be struck off and that the plaintiffs have to approach the Arbitrator. But the trial Court, has without jurisdiction, entertained the suit. Therefore, the revision petitioners preferred C.R.P. (PD) Nos.3353 and 3354 of 2013 for setting aside the impugned orders. It is further submitted that since the Civil Court has no jurisdiction to entertain the suit, the matter to be referred before Arbitration. Therefore, they preferred C.R.P.(PD) No.3355 of 2013 for striking out the plaint.
(ii)The plaintiffs, at the time of filing suit, also filed I.A.Nos.12049 and 12050 of 2013 for interim injunction and interim stay. But the trial Court granted interim orders. As per Section 43 of the Multi-State Co-operative Societies Act, 2002 (hereinafter called as Act), it deals with disqualification for being a member of the Board. The respondents 1 to 9 are absent themselves for three consecutive meetings, so they are disqualified for being a member of the Board automatically. The trial Court has not considered the above aspect. Since it is a business of the society, the jurisdiction of the Civil Court is barred. As per Section 84 of the Act, the disputes touching the constitution, management or business of a multi-state co-operative society to be settled by the Arbitrator. But the plaintiffs, without approaching Arbitrator, filed civil suit and hence, the civil suit itself is barred. So the revision petitions themselves are maintainable under Article 227 of Constitution of India.
(iii)The respondents 1 to 9/plaintiffs are erstwhile Directors of IMPCOPS and since they are absent for three consecutive meetings held on 19.06.2013, 08.07.2013 and 19.07.2013, as per Bye-law 39(m) and (n), they are disqualified for being members of the Board, which are replica of Section 43(m) and (n) of the Act. Hence, the plaintiffs have to move before the Arbitrator for settlement of disputes under Arbitration Act.
(iv)Learned senior counsel for the petitioners has also relied upon the unreported judgment of this Court in W.P.No.43810 of 2006, in which, it was held that if any question arises whether a dispute referred to arbitration under this Section is or a dispute touching the constitution, management or business of a Multi-State Co-operative society, the decision thereon of the arbitrator shall be final and shall not be called in question in any Court. He relied upon para-8 to 10 of the judgment and prayed for setting aside the impugned orders passed by the trial Court.
(v)The Board of Directors consist of 15 Directors, out of which, one is elected as Chief Executive Officer and 14 alone acted as Board of Directors. One of the Directors namely, Dr.Ramalingam was disqualified and removed by the General Body. So the present strength of the Board is only thirteen. The respondents 1 to 9 are nine Directors and the remaining is only five Directors. As per Bye-law No.44(3) of the Society, the coram for the board of meeting is one plus fifty percent of the existing board of directors. Since the respondents 1 to 9/plaintiffs are absent for three consecutive meetings held on 19.06.2013, 08.07.2013 and 19.07.2013, they are disqualified. Hence, the disqualification is valid under law and that can be questioned only by way of arbitration under Section 84 of the Act, which deals with the settlement of disputes arose between members, past members and the Society or its Board of Directors touching the constitution, management and business of the Society. The resolution dated 19.07.2013 passed by the defendants 1 to 6 disqualifying the plaintiffs/respondents 1 to 9 as Directors of the IMPCOPS is valid under law. But the trial Court has without having jurisdiction and without considering the same, passed interim orders and the same have to be set aside. Therefore, he prayed for allowing of the revision petitions. To substantiate his arguments, he relied upon the following decisions:
(i) 2013 (6) CTC 809 (N.A.Chinnasamy and another v. S.Velllingirinathan);
(ii) ILR 1992 Delhi 193 (Bharat Bhushan v. H.B.Portfolio Leasing Ltd.);
(iii) The judgment of the Rajasthan High Court in Viswanathan and another v. The State and others on 24.09.1956;
(iv) 2006 (7) SCC 275 (Rashtriya Ispat Nigam Ltd. and another v. Verma Transport Co.);
(v) ILR 1994 Delhi 495 (Lamba Steel and Alloys Pvt. Ltd. v. Municipal Corporation of Delhi);
(vi) AIR 1975 (2) SCC 445 (Nayagarh Co-operative Central Bank Ltd. v. Shri Narayana Rath and others);
(vii) AIR 1954 Madras 103 (M.S.Madhava Rao and others v. D.V.K.Surya Rao, Member of the Pithapuram Co-operative Bank);
(viii) 1991 Supp (2) Supreme Court Cases 215 (Prem Jeet Kumar v. Surender Gandotra and others);
(ix) (2007) 6 SCC 236 (Greater Bombay Co-op. Bank Ltd. v. United Yarn Tex (P) Ltd. and others);
(x) (1997) 5 SCC 76 (Achutananda Baidya v. Prafullya Kumar Gayen and others);
(xi) (2012) 3 SCC 495 (Madhya Pradesh Rural Road Development Authority and another v. L.G.Chaudhary Engineers and Contractors);
(xii) 1992 L.W.216 (Philip Jeyasingh v. The Joint Registrar of Co-operative Societies, Chidambaranar Region, Tuticorin and others);
(xiii) The judgment of this Court in C.R.P. (PD) Nos.1583 and 1584 of 2008, dated 24.04.2008;
(xiv) 2011-3-LW 827 (C.Janakiraman and others v. A.Arunkumar);
(xv) 2010 (2) MWN (Civil) 696 (The Food Corporation of India (South Zone) Employees' Co-op. Society Ltd., v. J.Shanmugam and others);
6.Resisting the same, Mr.N.G.R.Prasad, the learned counsel for the plaintiffs/respondents 1 to 9 made the following submissions:
(i)It is true, the first revision petitioner/Society is governed by the Act. It consists of 15 Directors, out of one is elected as Chief Executive Officer. Since one of the Directors namely, Dr.Ramalingam was disqualified, the present strength of the Directors is only thirteen. It is true, the respondents 1 to 9 herein were not attended three consecutive meetings. But they were prevented to attend the meeting, so they immediately sent a notice to the Secretary(In-Charge) IMPCOPS, but neither they given reply nor taken any steps to give security to the plaintiffs/respondents 1 to 9 to attend the meeting.
(ii)Before the third meeting, the respondents 1 to 9/plaintiffs filed the first suit in O.S.No.3882 of 2013 for the following reliefs:
(a) for declaring that the Board Meetings of first defendant Society held on 19.06.2013 and 08.07.2013 are null and void for want of corum as per bye law 44(3) of the first defendant Society;
(b) for permanent injunction restraining the defendants 2 to 4 from passing a resolution disqualifying the Plaintiffs as per bye law 39(1)(m) and removing them from Board of IMPCOPS; illegally contenting that the plaintiffs have absented themselves from three consecutive Board Meetings held on 19.06.2013, 08.07.2013 and 19.07.2013;
(c )granting permanent injunction restraining the defendants 2 to 4 from conducting the Board Meeting on 19.07.2013 as proposed in the notice of Meeting dated 09.07.2013, without requisite corum as per bye law 44(3) of IMPCOPS;
(d) to direct the fourth defendant to convene a Board Meeting to consider the subject of convening a Special General Body Meeting of IMPCOPS to consider the removal of 2nd and 3rd defendants from the membership of IMPCOPS. In the above suit, notice has been ordered. Before that, meeting notice has been issued on 09.07.2013 to all Directors with agenda. But the respondents 1 to 9 are prevented to attend the meeting. Since they are not attending the meeting on 19.07.2013, the resolution was passed for disqualifying the plaintiffs/respondents 1 to 9 for being Board of Directors of IMPCOPS. But the revision petitioners have not given any show cause notice and no explanations have been called for and moreover, principles of natural justice have not been followed and without Coram, the defendants disqualified the respondents 1 to 9, which is illegal.
(iii) Before passing resolution, the plaintiffs sent notice to the Secretary(In-Charge) IMPCOPS as to how they prevented with the Gundas to attend the meeting. Hence, the Civil Court alone has jurisdiction to decide the facts. He would further submit that the revision petitioners have every right to appear before the trial Court and file the counter to agitate the same and to file appeal under Order 43 Rule r of C.P.C., before the appropriate forum. But the defendants 1, 2 and 4, without resort any remedy, have come forward with the revisions by invoking Article 227 of Constitution of India, which is illegal and that the revision petitions are not maintainable. To substantiate his arguments, he relied upon the following judgments:
(i) AIR 1974 AP 49 (S.Seetha Ramaiah Naidu v. Ongole Co-operative Bank Ltd.);
(ii)(1998) 8 SCC 1 (Whirlpool Corporation v. Registrar of Trade Marks, Mumbai and others);
(iii)The judgment of this Court reported in 2007 (1) CTC 705 (All India Anna Dravida Munnetra Kazhagam, Chennai-14 represented by its Fisheries Wing Secretary Mr.D.Jayakumuar, M.L.A.) v. The State Election Commissioner, Chennai-26 and others);
7.Learned counsel appearing for R13/Central Registrar of Co-operative Society has submitted that from the readings of the CRP, it is observed that the 9 directors removed under Section 43 cannot be referred to arbitration for which the society has to take up the issue with the General Body for their removal under Section 47 of the MSCS Act, 2002. It is further submitted that the provision of Section 47 of the MSCS Act, 2002 relating to removal of elected members by general body is reproduced below for your information:
An elected member of a Board, who has acted adversely to the interests of multi-state cooperative society, may on the basis of a report of the Central Registrar or otherwise be removed from the board upon a resolution of the general body passed at its meeting by a majority of not less than two-third of the members present and voting at the meeting;
Provided that the member concerned shall not be removed unless he has given a reasonable opportunity of making a representation in the matter.
Therefore, he prayed for dismissal of the revision petitions. To substantiate his arguments, he relied upon the following judgments:
(i) AIR 1969 SC 1320 (Deccan Merchants Co-operative Bank Ltd., v. M/S.Dalichand Jugraj Jain and others);
(ii) AIR 2005 SC 1638 (N.Balaji v. Virendra Singh and others);
8.Considered the rival submissions made on both sides and perused the typed set of papers.
9.The admitted facts are as follows:
The respondents 1 to 9/plaintiffs, the revision petitioners/defendants 1, 2 and 4, respondents 10 to 12/defendants 3, 5 and 6 are Directors of the first defendant/The Indian Medical Practitioners' Co-operative Pharmacy and Stores (Multi-State Co-operative Society) Ltd. It consists of 15 Directors, out of which, one is elected as Chief Executive Officer. Now the Directors are only thirteen in number.
10.Now this Court has to decide whether the revision petitions are maintainable? Before adverting to the facts of the case, it is appropriate to consider the following decisions of this Court relied upon by the learned senior counsel for the revision petitioners:
(i)In the order of this Court dated 24.04.2008, in C.R.P. (PD) Nos.1583 and 1584 of 2008, which was filed by the first petitioner herein, the following order has been passed:
4. The learned counsel for the petitioner submits that the civil revision petitions has been filed by the petitioner under Article 227 of the Constitution of India against the order passed by the trial Court under Order 39 Rule 1 and 2 C.P.C., for the reasons that the suit itself is not maintainable and consequently, the applications filed by the first respondent/plaintiff are also not maintainable. Moreover under Section 84(2)(C ), there is a clear legal bar to entertain a suit in connection with the election of any officer of a multi-state co-operative society. Therefore, he prays that the order passed by the trial Court is to be set aside.
5.I am unable to accept the submissions made by the learned counsel for the petitioner for the reason that when an exparte interim order of injunction was passed by the court below under Order 39 Rule 1 and 2 C.P.C., it is open to the petitioner to first file appropriate application before the trial Court to vacate the exparte order stating their grievance before the trial Court. Having not done that the petitioner has straight away filed the present petition before this Court, which is not maintainable under Article 227 of the Constitution of India, Therefore, I am not inclined to interfere with the order passed by the Court below and these civil revision petitions are liable to the dismissed. He would submit that Section 84 of the Act has not been relied upon, hence, the judgment is Per incuriam.
(ii) In 2011-3-LW 827 (C.Janakiraman v. A.Arunkumar), wherein it was held that issue between the revision petitioners and the respondent is personal in nature, which resulted in conducting election by the revision petitioners claiming that they have removed the respondent from the post of President, whereas the respondent claimed that the revision petitioners have no power to conduct a meeting and as such, he cannot be removed from the post of Presidentship and thus, intends to restrain the conducting of election. In the above said decision, it was held that issue involved in the suits cannot be termed as the ''dispute touching the constitution, management or the business of the society.
(iii)In 2010 (2) MWN (Civil) 696 (The Food Corporation of India (South Zone) Employees' Co-operative Society Ltd., v. J.Shanmugam and others), it was held that the City Civil Court had failed to note that no suit shall be instituted against a Multi-State Co-operative Society or of any officers in respect of any act touching the constitution, management or the business of the society, until the expiration of 90 days after a notice, in writing, has been delivered to the Central Registrar or left at his office. Further, it was held that the civil revision petition under Article 227 of the Constitution of India, would not be the appropriate remedy available to the petitioners, at this stage. As such, the civil revision petition is devoid of merits and therefore, it stands dismissed directing the trial Court to decide the maintainability of the suit and to decide the case on merits in accordance with law. At this juncture, the learned senior counsel for the revision petitioners submitted that the above judgment is also per incuriam, as Section 84 of the Act was not brought to the knowledge.
(iv) In (2012) 3 SCC 495 (Madhya Pradesh Rural Road Development Authority and another v. L.G.Chaudhary Engineers and Contractors), wherein it was held that what is meant by per curiam. Paras-26, 28, 30, 31 and 35 are extracted hereunder:
26. It is clear, therefore, that in view of the aforesaid finding of a coordinate Bench of this Court on the distinct features of an Arbitral Tribunal under the said M.P.Act in Anshuman Shukla case the provisions of the M.P. Act are saved under Section 2(4) of the AC Act, 1996. This Court while rendering the decision in Va Tech (2011 (13) SCC 261) has not either noticed the previous decision of the coordinate Bench of this Court in Anshuman Shukla or the provisions of Section 2(4) of the AC Act, 1996. Therefore, we are constrained to hold that the decision of this Court in Va Tech was rendered per incuriam.
28.The principle of per incuriam has been very succinctly formulated by the Court of Appeal in Young vs. Bristol Aeroplane Company, Limited reported in 1944 (1) K.B. 718 (CA). Lord Greene, Master of Rolls formulated the principles on the basis of which a decision can be said to have been rendered `per incuriam'. The principles are:
"Where the court has construed a statute or a rule having the force of a statute its decision stands on the same footing as any other decision on a question of law, but where the court is satisfied that an earlier decision was given in ignorance of the terms of a statute or a rule having the force of a statute the position is very different. It cannot, in our opinion, be right to say that in such a case the court is entitled to disregard the statutory provision and is bound to follow a decision of its own given when that provision was not present to its mind. Cases of this description are examples of decisions given per incuriam."
30.Those principles have been followed by the Constitution Bench of this Court in Bengal Immunity Company Limited vs. The State of Bihar and others reported in 1955 (2) SCR 603 [See the discussion in pages 622 and 623 of the report].
31. The same principle has been reiterated by Lord Evershed, Master of Rolls, in Morelle Ld. vs. Wakeling & another [(1955) 2 QB 379 at page 406]. The principle has been stated as followed:
"...As a general rule the only cases in which decisions should be held to have been given per incuriam are those of decisions given in ignorance or forgetfulness of some inconsistent statutory provision or of some authority binding on the court concerned; so that in such cases some part of the decision or some step in the reasoning on which it is based is found, on that account, to be demonstrably wrong."
35.Following the aforesaid principles, this Court is constrained to hold that the decision in Va Tech having been rendered per incuriam, cannot be accepted as a precedent to decide the controversy in this case.
(v)In 1992 L.W.216 (Philip Jeyasingh v. The Joint Registrar of Co-operative Societies, Chidambaranar Region, Tuticorin and others), in para-4 and 12, it was held as follows:
4. In Jai Kaur v. Sher Singh , the Supreme Court held that a subsequent Division Bench cannot disagree with a previous decision of the Full Bench of the same Court. Referring to the above ruling in Mahadeolal's case, the Court observed.
If, as we pointed out there, considerations of judicial decorum and legal propriety require that Division Benches should not themselves pronounce decisions of other Division Benches to be wrong, such considerations should stand even more firmly in the way of Division Benches disagreeing with a previous decision of the Full Bench of the same court.
12.In Eknath Shankarrao Mukhawar v. State of Maharashtra, it was held that judicial discipline as well as decorum suggested only one course when a Bench wanted to differ from the decision of a co-ordinate court and that was to refer to a larger Bench.
11.Admittedly, the revision petitioners 2 and 3 and the respondents 1 to 11 are Board of Directors. It is true, the first meeting is proposed to be held on 19.06.2013 and on that date, the meeting was held. But the respondents 1 to 9 did not attend the meeting and on the same day (i.e.) before the meeting was held, they had given objection letter to the Secretary (In-charge), IMPCOPS and some of their objections for the said meeting are as follows:
a. As per Bylaw No.44(3) of the Society, the corum for the Board meeting is one plus fifty percent of the existing Board of Directors. The present strength of the Board Thirteen. Since, we the undersigned nine Directors are not attending the said meeting, there is no corum. If you insist in conducting the said meeting and passing resolutions, it is illegal.
b.We oppose agenda No.13 proposing to avail loan of Rs.90,00,000/- from State Bank of Mysore, Thiruvanmiyur Branch. We are opposing this resolution because of the prevailing mismanagement of funds and wasteful and illegal expenditure of the funds of the Society.
c. .. ..
d. .. ..
e. .. ..
f. .. ..
g. When the undersigned came to attend the Board the meeting on 28.03.2013, they were prevented to enter into the IMPCOPS Campus by some of the employees who were reinstated. There afterwards we lodged a police complaint. Then only we were able to enter the campus and attend the meeting. We made a complaint to the secretary and no action was taken.
We are afraid that the above said malpractices will be repeated during the meeting held on 19.06.2013. Therefore, we are not attending the said meeting.
12.It shows that the respondents 1 to 9 afraid to attend the meeting and send intimation. Thereafter, meeting notice was sent to all Directors with agenda on 29.06.2013. After receipt of notice of the meeting to be held on 09.07.2013, one Dr.Tamil Mani, who is the second plaintiff, has sent a letter to the Secretary(In-charge) of IMPCOPS on 05.07.2013, in which, it was specifically mentioned as follows:
..
..
c.We attended the Board Meeting on 28.3.2013 with police protection after we were physically prevented to enter the IMPCOPS premises to attend the Board Meeting.
d. .. ..
e. The safety of the Directors is in peril and we the majority Directors are fed up and feel insulted to approach the police, even for attending the Board and EC Meetings.
Under these circumstances, unless these violations are stopped there is no point in attending these Board Meeting proposed to be held on 08.07.2013, when nine Directors and over 580 members have demanded for Special General Body Meeting, for the removal of the President and the Vice President, for their willful acts of indulging in anti society activities and thereby causing loss and injury to the society. It is better all Agenda proposed for the Board Meeting to be held on 08.07.2013 are deferred to another Board Meeting. Now, the special General Body Meeting should be arranged to be held, as requested by the majority of the Board of Directors and 580 of the members of the society. On 09.07.2013, the Secretary(In-Charge) of IMPCOPS sent another meeting notice to all Directors with agenda, to fix the meeting to be held on 19.07.2013, which finds place in page-72 of the typed set of papers.
13.Before the third meeting (i.e.) on 19.07.2013, the respondents 1 to 9/plaintiffs filed suit in O.S.No.3882 of 2013 for the following reliefs:
a) Declaring that the Board Meetings of 1st defendant society held on 19.6.2013 and 8.7.2013 are null and void for want of corum as per bye law 44(3) of the 1st defendant Society.
b) Granting permanent injunction restraining the Defendants 2 to 4 from passing a resolution disqualifying the Plaintiffs as per bye law 39(1)(m) and removing them from Board of IMPCOPS; illegally contenting that the Plaintiffs have absented themselves from three consecutive Board Meetings held on 19.6.2013, 08.07.2013 and 19.07.2013;
c) Granting permanent injunction restraining the Defendants 2 to 4 from conducting the Board Meeting on 19.07.2013 as proposed in the notice of Meeting dated 9.7.2013, without requisite corum as per bye law 44(3) of IMPCOPS;
d) To direct the 4th defendant to convene a Board Meeting to consider the subject of convening a Special General Body Meeting of IMPCOPS to consider the removal of 2nd and 3rd Defendants from the membership of IMPCOPS;
e) To direct the defendants to pay the cost of the suit;
f)other reliefs;
14.It is seen that the respondents 1 to 9 made objections for each and every meeting and made allegations for mismanagement of funds for availing loan. In such circumstances, it is unable to understand as to why on 19.07.2013, the Society conducted meeting and disqualified the respondents 1 to 9 from being members of the Board in terms of Bye-law 39(m) of the society. According to the learned counsel for the respondents 1 to 9, because of the attitude of the revision petitioners, they are prevented to attend the meeting and merely because they are not attending three consecutive meetings, even though they sent a communication to the Secretary(In-Charge), IMPCOPS, the resolution passed by the revision petitioners, respondents 10 and 11 disqualifying the respondents 1 to 9, is illegal. At this stage, this Court is forced to accept the argument advanced by the learned counsel for the respondents 1 to 9.
15.At this juncture, learned counsel for the revision petitioners submitted that the resolution for disqualification passed by the Society is automatic and no need to give a show cause notice and call for explanation before passing resolution for disqualification. He further submitted that as per the Bye-law 44(3), quorum for the meeting shall be one plus fifty percent of the existing strength of the Board. After nine Directors were disqualified, the balance strength of the Directors is five and they were attended the meeting and passed the resolution, which is legal. In my opinion, the above argument does not hold good.
16.In the objection raised by the respondents 1 to 9 dated 19.06.2013, it was specifically stated in clause (a) is as follows:
a.As per Bylaw No.44(3) of the Society, the corum for the Board meeting is one plus fifty percent of the existing Board of Directors. The present strength of the Board Thirteen. Since, we the undersigned nine Directors are not attending the said meeting, there is no corum. If you insist in conducting the said meeting and passing resolutions, it is illegal.
Even though in the above said letter dated 19.06.2013, the respondents 1 to 9 had made allegations against the revision petitioners apprehending that resolution will be passed, the meetings have been conducted on 19.06.2013, 08.07.2013 and 19.07.2013, which shows the revision petitioners, with malafide intention, to disqualify the respondents 1 to 9/Directors, conducted the meetings.
17.At this juncture, learned senior counsel for the revision petitioners submitted that the disqualification is valid under law and that can be questioned only by way of arbitration under Section 84 of the Act, which deals with the settlement of disputes arose between members, past members and the Society or its Board of Directors touching the constitution, management and business of the Society.
18.It is appropriate to incorporate Section 84(3) of the Act, which runs as follows:
(3)If any question arises whether a dispute referred to arbitration under this section is or is not a dispute touching the constitution, management or business of a multi-state cooperative society, the decision thereon of the arbitrator shall be final and shall not be called in question in any court. Here, the constitution has not been disputed, because from the inception (i.e.) on 19.06.2013 onwards, on which date, the first meeting was held, the respondents 1 to 9 objected for conducting meeting. As per the clause (b) of the objection letter sent by the respondents 1 to 9, they oppose agenda No.13 proposing to avail loan of Rs.90,00,000/- from the State Bank of Mysore, Thiruvanmiyur Branch, because of the prevailing mismanagement of funds and wasteful and illegal expenditure of the funds of the society. But no reply has been sent, per contra, meeting was held on 19.06.2013.
19.As already stated that the respondents 1 to 9 themselves filed a suit in O.S.No.3882 of 2013 for declaring that the board meetings of first defendant society held on 19.06.2013 and 08.07.2013 are null and void, in which, notice has been ordered, but no interim order has been granted. Again the meeting was held on 19.07.2013 and resolution order was passed, which shows that the action of the revision petitioners themselves is illegal and they have not followed the principles of natural justice. In such circumstances, I am of the view, the Civil Court alone is competent to decide the issue raised in the suit. So the argument advanced by the learned senior counsel for the petitioners that as per Section 84 of the Act, the disputes between the Directors and Society to be settled by the Arbitrator does not merit acceptance.
20.As per the submissions made by the learned counsel for R13/Central Registrar of Co-operative Societies, it would show that removal of Board of Directors is not a matter for settlement before Arbitration. It clearly shows that only civil suit is maintainable.
21.In such circumstances, it is appropriate to consider the decisions relied on by the learned senior counsel for the petitioners:
(i) In 1975 (2) SCC 445 (Nayagarh Co-operative Central Bank Limited v. Shri Narayana Rath and others), wherein it was held that the disputes which may be referred to arbitration as per Section 68 of the Orissa Co-operative Societies Act, 1962. In para-4 and 5, it is held as follows:
4. Section 68 so far as it is relevant for the purpose of these appeals reads:
68: Dispute which may be referred to arbitration: (1)Notwithstanding anything contained in any law for the time being in force, any dispute touching the Constitution, management or the business of a society other than a dispute regarding disciplinary action taken by a society or its committee against paid servant of the society, shall be referred to the Registrar if the parties thereto are among the following, namely:
(a)the society, its committee, past Committee, any past or present officer, any past or present agent, any past or present servant of the nominees, heir or legal representatives of any deceased officer, deceased agent or deceased servant of the society or the liquidator of the society; or
(b) a member, past member or a person claiming through a member, past member or deceased member of the society or of a society which is a member of the society; or
(c) A surety of a member, past member or a deceased member whether such surety is or is not a member of the society; or
(d) any other society or the liquidator of such society.
Explanation I: A claim in respect of any sum payable to or by a society by or to a person or society or a liquidator mentioned in Clauses (a) to (d) shall be a dispute touching the business even in case such claim is admitted & the only point in issue is the ability to pay and the manner of enforcement of payment.
For the present purpose, Section 68 requires two conditions to be satisfied: (i) that the dispute must be one touching the business of a society other than a dispute regarding disciplinary action taken by the society against a paid servant and (ii) that the dispute must be one involving parties who are among those mentioned in the section. Here the parties concerned are among those listed in this section, and the dispute also touches the business of the society, the nature of the dispute being as stated in explanation 1. Prima facie therefore the requirements of Section 68(1) are satisfied in these cases.
5. The first respondent however contends that the disputes so far as he is concerned are not such as are contemplated in Section 68(1). We do not propose to consider the merits of this contention because of Sub-section (4) Section 68 which says:
(4) If any question arises whether a dispute referred to the Registrar under this section is a dispute touching the Constitution, management or the business of a society, the decision thereon of the Registrar shall be final and shall not be called in question in any Court.
In view of the provisions of Section 68(4) we think that this is a matter which the Registrar must decide before the writ jurisdiction of the High Court is allowed to be invoked.
But the above decision is not applicable to the facts of the present case.
(ii) In AIR 1954 Madras page 103 (Full Bench) (M.S.Madhava Rao and others v. D.V.K.Surya Rao), wherein it was held that all matters comprised in them or are incidental to or necessary for carrying out those matters must be deemed to be the business of the corporation. The power of the corporation is derived from these three sources, and so long as its activity is within those powers, it cannot be questioned as being invalid. A dispute relating therefore to election would undoubtedly be a dispute concerning or relating to the business of the society. Para-8 and 16 are extracted hereunder:
8. Section 51(1) of the Act, on the interpretation of which the decision of the question raised turns is as follows:
"If any dispute touching the business of a registered society (other than a dispute regarding disciplinary action taken by the society or its committee against a paid servant of the society) arises :
(a) among members, past members and persons claiming through members, past members and deceased members, or
(b) between a member, past member or person claiming through a member, past member or deceased member and the society, its committee or any officer, agent or servant of the society, or
(c) between the society or its committee and any past committee, any officer, agent or servant or any past officer, past agent or past servant, or the nominees, heirs or legal representatives of any deceased officer, deceased agent, or deceased servant of the society; or
(d) between the society and any other registered society such dispute shall be referred to the registrar for decision.
Explanation : A claim by registered society for any debt or demand due to it from a member, past member, or the nominee, heir or legal representative of a deceased member, whether such debt or demand be admitted or not, is a dispute touching the business of the society within the meaning of this sub-section."
16.Apart from the decisions to be referred to presently, on a plain reading of the provisions, it will be seen that bye-law 32 treats the election of directors by the members at a corporate meeting of the general body as part of the business of the society. A dispute relating therefore to election would undoubtedly be a dispute concerning or relating to the business of the society. .. .. But the above citation is not applicable to the facts of the present case, because it is not a dispute relating to election, in the case on hand, the dispute is that the resolution passed for disqualifying the plaintiffs/respondents 1 to 9 herein. So it is not a business of the Society.
22.In normal course, if the Directors did not attend the meeting, without sending any intimation, Board of Directors have right to invoke clause 39(m) of Bye-law and disqualify the Directors for their absence. So it is appropriate to incorporate Section 39(m) of Bye-law, which is a replica of Section 43(m) of the Act, in which, it was specifically mentioned as follows:
Absents himself from three consecutive board meetings and such absence has not been condoned by the Board. Prior to each and every meeting, the plaintiffs/respondents 1 to 9 have sought for special general body meeting to be convened and they sent intimation as to how they prevented to attend the meeting and they objected for convene the meeting. But the revision petitioners and respondents 10 and 11 joined together and passed resolution for disqualifying the respondents 1 to 9 as if they wantonly and willfully not attended the meetings without any reason. But the Special General Body Meeting, convened only with five persons joined together and passed the resolution. In such circumstances, I am of the view, whether the resolution passed on 19.07.2013 is legal or illegal to be decided only by the Civil Court not by the Arbitrator.
23.According to the learned counsel for R13, only civil suit is maintainable and as per Section 47 of the Act, it deals with removal of elected members by general body.
24.At this juncture, it is appropriate to consider the following decisions relied upon by the learned senior counsel for the petitioners:
(i) In 2013 (6) CTC 809 (N.A.Chinnasamy and another v. S.Velllingirinathan), wherein it was held that Article 227 of Constitution of India has been invoked for striking out the plaint to meet out the ends of justice, if the plaintiff abuses the process of Court. There is no quarrel over the above proposition. But the above citation is not applicable to the facts of the present case. Because in the case on hand, disqualification of Directors have been challenged in the suit. In such circumstances, Civil Court alone has to be decided as to whether the disqualification/removal of Directors is legal or illegal.
(ii) In ILR 1992 Delhi 193 (Bharat Bhushan v. H.B.Portfolio Leasing Ltd.), in para-7, it is held as follows:
7. Section 283(1)(g) lays down that the office of a director shall become vacant if he absents himself from three consecutive meetings of the board of directors, or from all meetings of the board for a continuous period of three months, whichever is longer, without obtaining leave of absence from the board. This particular provision does not contemplate the passing of any board resolution for showing that the office of the director has been vacated by a particular director. It appears that the vacation of the office of director is automatic as soon as a director is found to have incurred the disability as contemplated by clause (g). Section 284 of the Companies Act, however, contemplates removal of a director by the passing of a board resolution. That provision, in fact, is not applicable where the director vacates office by virtue of incurring the disqualifications laid down in section 283. .. .. But the above citation is not applicable to the facts of the present case.
(iii) In the judgment of the Rajasthan High Court in Viswanathan and another v. The State and others on 24.09.1956, in para-12, it is held as follows:
12. It has, however, been urged that we should not declare the seats of these members vacant because they were misled by Rule 13 of the Rules, and might have reasonably taken the view that a chairman could not function without his name being notified in the gazette, and that this view of theirs was later upheld by the Government also in its order under Section 12 (5). We should, however, like to point out that Sheo Bhagwan and Chuniram did attend meetings up to November or December, 1955. It was only thereafter that they gave up attending meetings. Whatever might have been the reason which impelled them to do so, the fact remains that under Section 12 (3) (c) the disqualification is automatic, and it is provided that if a member is absent for four consecutive months, he shall be disabled from continuing to be a member, and his seat shall be deemed to have become vacant. There is no provision anywhere for waiving this disqualification once it is incurred. We are, therefore, of opinion that even if there was some misapprehension on account of Rule 13 of the Rules, it is not possible to waive the disqualification once it has been incurred. We have, therefore, to hold that Sheo Bhagwan and Chuniram having incurred the disqualification mentioned in Section 12 (3) (c) have become disabled from continuing to be members of the Board and their seats have become vacant. But the above citation is not applicable to the facts of the present case, because, in the case on hand, as per the clause of 39(m) of Bye-law, absents himself from three consecutive board meetings and such absence has not been condoned by the Board. But here, before conducting each and every Board Meeting, the respondents 1 to 9 sent a letter as to who they prevented to attend the meeting and also for directing the Secretary(In-Charge), IMPCOPS, to convene Special General Body Meeting.
(iv) In 2006 (7) SCC 275 (Rashtriya Ispat Nigam Ltd. and another v. Verma Transport Co.), in para-30, 31 and 35, it is held as follows:
30.No final decision had, therefore, been taken. The basic question was whether there had been breaches of contract on the part of the Respondents. The contention of the Respondent before the trial court had been that the order of blacklisting had arisen from the terms of the contract itself, as would appear from the following averments :
"14. That the plaintiff have learnt that the defendants without following the basic principles of natural justice are intending to terminate the consignment agency contract of the plaintiff and to blacklist the plaintiff on alleged ground that one of Ex-partners of the plaintiff is claimed to be guilty of misrepresentation of overcharging the freight by misrepresentation from a different company. Anyhow this is no ground to do so."
31.The principal grievance of the Plaintiff-Respondent was the action on the part of the appellants terminating the contract. Grounds on which the order of termination was based, have been questioned in the plaint. Such contentions could well be raised before the Arbitrator.
35.This aspect of the matter was considered by this Court in Food Corporation of India & Anr. v. Yadav Enginner & Contractor [1983 (1) SCR 95]. Therein this Court opined that interlocutory proceedings are only incidental proceedings to the main proceedings and, thus, any step taken in the interlocutory proceedings does not come within the purview of main proceedings, stating :
"When ex parte orders are made at the back of the party the other party is forced to come to the court to vindicate its right. Such compulsion cannot disclose an unambiguous intention to give up the benefit of the arbitration agreement. Therefore, taking any other steps in the proceedings must be confined to taking steps in the proceedings for resolution of the substantial dispute in the suit. Appearing and contesting the interlocutory applications by seeking either vacation thereof or modification thereof cannot be said to be displaying an unambiguous intention to acquiesce in the suit and to waive the benefit of the arbitration agreement. Any other view would both be harsh and inequitous and contrary to the underlying intendment of the Act. The first party which approaches the court and seeks an ex parte interim order has obviously come to the court in breach of the arbitration agreement. By obtaining an ex parte order if it forces the other party to the agreement to suffer the order, or by merely contesting be imputed the intention of waiving the benefit of arbitration agreement, it would enjoy an undeserved advantage. Such could not be the underlying purpose of Section 34. Therefore, in our opinion, to effectuate the purpose underlying Section 34 the narrow construction of the expression "taking any other steps in the proceedings" as hereinabove set out appears to advance the object and purpose underlying Section 34 and the purpose for which the Act was enacted.
(v) In ILR 1994 Delhi 495 (Lamba Steel and Alloys Pvt. Ltd. v. Municipal Corporation of Delhi), in para-20, it is held as follows:
20. As regards the contention of the learned counsel for the petitioner that DESU has no power to raise the bill retrospectively from February 1987 to November 1990 a reference may be made to a Division Bench judgment of this court in the case of Municipal Corporation of Delhi v. H. D. Shourie (1994 (1) AD (Delhi) 105). In this case a Division Bench of this court upheld the findings of a learned Single Judge of this court that the liability to pay may arise when the electricity is consumed by the consumer nevertheless it becomes due and payable when the liability is quantified and a bill is raised. The question whether a revised bill for the earlier period can be raised by DESU, will be gone into by the arbitrator. Besides, this question with regard to a case of alleged theft will also have to be gone into by the arbitrator. All other questions including as to whether the principles of natural justice have been violated in the present case, will also have to be examined by the arbitrator. The above citation is not applicable to the facts of the present case, because in the above case, it deals with theft of electricity. In such circumstances, Arbitrator was appointed to settle the matter and the bill amount.
(vi) In 1991 Supp (2) Supreme Court Cases 215 (Prem Jeet Kumar v. Surender Gandotra and others), wherein it was held that dispute touching the constitution, management or business. In para-4, it was held as follows:
4.In substance the contention of the learned counsel for the appellant is that the proper action to take in such a case is to resort to section 59 dealing with surcharge and not to settlement of dispute by arbitration since it is not one of the disputes which may be referred to arbitration in terms of section 60 of the Delhi Act. It was argued that sub-section (2) of section 60 is exhaustive and not merely illustrative, which shows that the present dispute does not fall within the ambit of section 60. Dr. Chitale, on the other hand, asserted that it is sub-section (1) of section 60 which indicates the true scope of section 60 while sub-section (2) is merely illustrative and no exhaustive. It was urged that clause (c) of sub-section (1) of section 60 expressly provides that if any dispute touching the constitution, management or the business of the cooperative society arises between the society or its committee and any past committee, any officer, agent or employee or any past officer of the society, the dispute shall be referred to arbitration. But the above citation is not applicable to the facts of the present case. Because, in the case on hand, disqualification of the plaintiffs/respondents 1 to 9 was questioned by them that as per Section 43 of the Act, disqualification/removal of the Directors is only done by the General Body.
(vii) In (2007) 6 SCC 236 (Greater Bombay Co-op. Bank Ltd. v. United Yarn Tex (P) Ltd. and others), wherein it was held that in the case under the recovery of debt due to Banks and Financial Institution Act, 1993, it defines which is a Civil Court. In para-76, it was held as follows:
76.Section 31 of the RDB Act clearly refers to transfer of 'every suit or other proceeding pending before any court'. The word 'court', in the context of the RDB Act, signifies 'civil court'. It is clear that the Registrar, or an officer designated by him or an arbitrator under Sections 61, 62, 70 and 71 of the APCS Act, 1964 and under Section 91 and other provisions of Chapter IX of the MCS Act, 1960 are not 'civil courts'.
(viii) In (1997) 5 SCC 76 (Achutananda Baidya v. Prafullya Kumar Gayen and others), in paras-9 to 11, it was held as follows:
9.We are, however, unable to accept such contention of Mr Bhattacharyya. In this case, the High Court has rightly held that the appellate authority came to the finding of non-existence of oral agreement of reconveyance without considering the evidence on record. If the appellate authority does not consider the materials on record having a bearing on a finding of fact and makes the finding of fact, such finding of fact arrived without consideration of relevant materials on record cannot be sustained in law. The High Court, in such circumstances, will be competent to consider the validity of the finding of fact assailed before it with reference to materials on record.
10.The power of superintendence of the High Court under Article 227 of the Constitution is not confined to administrative superintendence only but such power includes within its sweep the power of judicial review. The power and duty of the High Court under Article 227 is essentially to ensure that the Courts and Tribunals, inferior to High Court, have done what they were required to do. Law is well settled by various decisions of this Court that the High Court can interfere under Article 227 of the Constitution in cases of erroneous assumption or acting beyond its jurisdiction, refusal to exercise jurisdiction, error of law apparent on record as distinguished from a mere mistake of law, arbitrary or capricious exercise of authority or discretion, a patent error in procedure, arriving at a finding which is perverse or based on no material, or resulting in manifest injustice. As regards finding of fact of the inferior court, the High Court should not quash the judgment of the subordinate court merely on the ground that its finding of fact was erroneous but it will be open to the High Court in exercise of the powers under Article 227 to interfere with the finding of fact if the subordinate court came to the conclusion without any evidence or upon manifest misreading of the evidence thereby indulging in improper exercise of jurisdiction or if its conclusions are perverse.
11.If the evidence on record in respect of a question of fact is not at all taken into consideration and without reference to such evidence, the finding of fact is arrived at by inferior court or Tribunal, such finding must be held to be perverse and lacking in factual basis. In such circumstances, in exercise of the jurisdiction under Article 227, the High Court will be competent to quash such perverse finding of fact.
25.The following decisions are relied upon by the learned counsel for R13/Central Registrar of Co-operative Society:
(i) In AIR 1969 SC 1320 (Deccan Merchants Co-operative Bank Ltd., v. M/S.Dalichand Jugraj Jain and others), wherein 'Business' is defined. In para-25 and 26, it was held as follows:
25. The appeal must also fail on the ground that even if it is a dispute touching the business of the society within the meaning of Section 91(1) of the Act, it is not a dispute between a society and a member or a person claiming through a member. It seems to us that before a person can be said to claim through a member, the claim should arise through a transaction or dealing which the member entered into with the society as a member. If a member entered into a transaction with the society not as a member but as a stranger, then he must be covered, if at all, by the provisions of Section 91(1)(a) or (c). But once it is held that the original transaction was entered into by the member with the society as a member then any person who claims rights or title through that member must come within the provisions of Section 91(1)(b).
26.It has been held in various cases in England that disputes referable under similar acts are only disputes between a society and a member of a society when he enters into a transaction with the society as a member.
[See Morrison v. Glover, [1849] 154 E.R. 1231; Prentice v. London, [1875] L.R. 10 C.P. 679; Palliser v. Dale, [1897] 1 Q.B. 257; Judson v. Ellesmere Port Ex-servicemen's Club Ltd., [1948] All E.R. 844]. Similar view was expressed by the Bombay High Court in Shyam Co-operative Society Ltd. v. Ramibai Bhagwansing, 54 BOM LB 517 = [1952 BOM 445. where Chagla C.J. observed :
" Now, before a case can fall under Section 54 (of the Bombay Cooperative Societies Act VII of 1925), it is not sufficient that there should be a dispute touching the business of the society. What is further required is that the dispute must be between the society and its member, and proper emphasis has got to be laid upon the expression 'member' used in this section. The dispute must be between the society and the member as a member or quae a member. It must be a dispute in which the member must be interested as a member. It must relate to a transaction in which the member must be interested as a member."
(ii) In AIR 2005 SCC 1638 (N.Balaji v. Virendra Singh and others), wherein it was held that the dispute raised before or referred to Central Registrar does not attract application of any rigorous rules of pleadings in civil suit under C.P.C. or election petition filed under provisions of representation of the People Act, 1951. Para-9 is extracted hereunder:
9.Before we consider the respective submissions so made it would be appropriate to re-produce the relevant portion of Section 75(d) and sub-section(3) of Sec.75 of the Act, which reads as under :-
Section 75: Limitation (1) Notwithstanding anything contained in the Limitation Act, 1963 (36 of 1963), but subject to the specific provisions made in this Act; the period of limitation in the case of a dispute referred to the Central Registrar shall,---
(a)..
(b)..
(c)........
(d) when the dispute is in respect of an election of an officer of a multi-State co-operative society, be one month from the date of the declaration of the result of the election.
Section 75 (3) Notwithstanding anything contained in sub-sections (1) and (2), the Central Registrar may admit a dispute after the expiry of the period of limitation, if the applicant satisfies the Central Registrar that he had sufficient cause for not referring the dispute within such period.
Relevant provision of Section 74(1) read with Section 74(1) (C ) of the Act of 1984 provides that notwithstanding anything contained in any other law for the time being in force, if any dispute arises amongst the members in connection with the election of any officer of the multi-State cooperative society (officer, includes the member of the Board by virtue of definition of Officer in Sec.3 (o) of the old Act), it shall be referred to the Central Registrar for decision and no Court has jurisdiction to entertain any such or other proceedings in respect of such dispute. Thus whenever there is a dispute among the members in connection with the election of a member of the Board, it shall be referred to Central Registrar for decision. Clause (d) of Section 75 postulates that the election dispute of the member of the Board of a multi-State Cooperative Society is to be raised within one month from the date of declaration of the result of the election. Sub-s.(3) of Sec.75 authorizes the Central Registrar for the sufficient cause to admit a dispute after the expiry of the period of limitation if the Central Registrar is satisfied of the sufficiency of the cause of raising the dispute beyond the period of limitation. In the present case it is apparent that the dispute has been raised prior to conduct and declaration of the result of election by the appellant by making representation on 23.7.2002 and 7.8.2002 and on other dates regarding validity of the electoral roll for the conduct of the election and on 21.8.2002 after the election has been held. The appellant approached the Delhi High Court by way of writ petition also. A direction was issued by the Delhi High Court by its order dated 28.2.2003 in specific terms that the representation of the petitioner raising dispute or any other petition containing the dispute regarding setting aside election of the Board of Directors held on 17th August 2002 be referred to the Central Registrar for adjudication under the Act of 1984. The direction in unequivocal terms directs consideration of all the representations or any other petition containing the dispute regarding the election to be referred to the Central Registrar for adjudication. The dispute or the representation made by the appellant regarding the electoral roll would also be a dispute regarding the election held on 17th of August 2002 apart from the dispute to the election raised by the petitioner after the election by his representation dated 21.8.2002 sent to the Minister concerned. The High Court of Delhi directed the Central Registrar to decide the said dispute within a period of four months. Direction of the High Court clearly contemplates decision on all the petitions raising disputes to the election held on 17th August 2002 within a period of four months. The Court has not left open the question of limitation to be considered while giving directions to decide the dispute within four months. Directions issued by the Court do not in any way specify that the question of limitation will be decided by the Central Registrar. It was only the submission made by counsel for the respondent which was noted by the Court and in spite of the submission being noted on the question of limitation, the said objection was not left open for consideration by the Central Registrar. What was filed on 30.4.2003 before the Central Registrar was only a consolidated dispute petition incorporating all the objections to the election raised by him from time to time. The petition dated 30.4.2003 has to be read in continuation of the several representations and objection petitions filed earlier, from time to time and cannot be considered to be a separate and independent petition. The petition dated 30.4.2003 is a consolidated version of various grounds raising dispute to election in required format so as to facilitate the tribunal to adjudicate and decide all the questions raised after giving adequate opportunity of hearing to all parties. An election dispute raised before or referred to the Central Registrar does not attract application of any rigorous rules of pleadings in a the civil suit under the Civil Procedure Code or the election petition filed under the provisions of Representation of People Act 1951. But the above citation is not applicable to the facts of the present case, because the dispute is in respect of election under the Multi-State Co-operative Society Act. In the case on hand, disqualification/removal of Directors has been questioned. So it is not applicable.
26.The learned counsel for the respondents 1 to 9/plaintiffs has relied upon the following decisions:
(i) In AIR 1974 AP 49 (S.Seetha Ramaiah Naidu v. Ongole Co-operative Bank Ltd.), in which, it defines coram and meeting. Para-21 and 31 are extracted hereunder:
21. B. A. Masodkar in his Law of Meetings in India, in Chapter II considers elaborately the meaning and concept of a meeting. He then summarises the whole discussion at page 69 in para 11 and draws certain principles. One of the principles he drew reads : "The quorum is the minimum that is required to constitute any meeting and in want of quorum in law, there is no meeting."
31. Frank Shackleton in his Law and Practice of Meetings defines a meeting as follows :
"A meeting is a gathering or assembly of a number of people for purposes of intercourse, entertainment, discussion , legislation and the like or for the purpose of the discussion of matters of public interest or for the purpose of the expression of views on such matters." What follows from the abovesaid definition of the meeting as well as the principles relating to quorum is that a meeting can be said to be a meeting only when it meets for the purpose of discussing and deciding something for which the meeting is called. If that purpose cannot be achieved because of lack of the requisite minimum number of members, then it does not constitute a valid meeting. In the eye of law, therefore, in order to constitute a meeting within the meaning of bye-law 22, the meeting should be validly constituted and in our opinion, the meeting cannot be said to be validly constituted unless the factors like quorum, notice, eligibility of the persons to attend, the business to be transacted which all go to make valid constitution of a particular meeting are satisfied. It is only such a meeting that can be said to have met for the purpose of discussing and transacting business. Mere assemblage of 3 persons which do not constitute a quorum can be a meeting only when it adjourns and again and again meets a second time as an adjourned meeting because in that case, the next meeting would be considered as a continuation of the first meeting, not otherwise. Except in that case therefore in all other cases, merely because some members who do not constitute a quorum meet in response to a notice, it cannot be a meeting for the purpose of Bye-law 22.
(ii) In (1998) 8 SCC 1 (Whirlpool Corporation v. Registrar of Trade Marks, Mumbai and others), in para-14 and 15, it is held as follows:
14.The power to issue prerogative writs under Article 226 of the Constitution is plenary in nature and is not limited by any other provision of the Constitution. This power can be exercised by the High Court not only for issuing writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari for the enforcement of any of the Fundamental Rights contained in Part III of the Constitution but also for any other purpose.
15.Under Article 226 of the Constitution, the High Court, having regard to the facts of the case, has a discretion to entertain or not to entertain a writ petition. But the High Court has imposed upon itself certain restrictions one of which is that if an effective and efficacious remedy is available, the High Court would not normally exercise its jurisdiction. But the alternative remedy has been consistently held by this Court not to operate as a bar in at least three contingencies, namely, where the Writ Petition has been filed for the enforcement of any of the Fundamental rights or where there has been a violation of the principle of natural justice or where the order or proceedings are wholly without jurisdiction or the vires of an Act is challenged. There is a plethora of case law on this point but to cut down this circle of forensic whirlpool we would rely or some old decisions of the evolutionary era of the constitutional law as they still hold the field.
(iii) In the judgment of this Court reported in 2007 (1) CTC 705 (All India Anna Dravida Munnetra Kazhagam, Chennai-14 represented by its Fisheries Wing Secretary Mr.D.Jayakumuar, M.L.A.) v. The State Election Commissioner, Chennai-26 and others), wherein it was held that in the election matters, writ petitions are not maintainable under Article 226 of Constitution of India, but in exceptional cases, writ petition under Article 226 of Constitution of India were entertained and the results of the elections were set aside for some stated reasons. Likewise, the suit for declaring that the resolution dated 19.07.2013 passed by the defendants 1 to 6 disqualifying the plaintiffs as Directors of IMPCOPS as null and void and other consequential reliefs is only triable by the Civil Court. So the Civil Court has jurisdiction. Para-148 and 154 are extracted hereunder:
148. While on the one hand, the Supreme Court has highlighted the values of democracy and holding of free and fair elections to achieve the targeted goal, it has also been reminding a note of caution every now and then to the Courts, in particular, the exercise of Writ jurisdiction under Article 226 of the Constitution to be more circumscribe in its exercise. While highlighting such a cautious note, the Supreme Court has also made it clear that the Court should not hesitate to step in wherever and whenever injustice is meted out, that in such a situation, the Writ Court has got powers even to determine the questions of fact when they are disputed, that existence of alternative remedy by itself need not deter the Court to exercise its extraordinary jurisdiction or to put in the words of the Supreme Court, if the monstrosity of the situation warrants such interference.
154. From a conspectus reading of the various decisions placed before us, I find that there were exceptional cases where the Supreme Court affirmed the decision of the High Courts where in Election matters, the Writ Petitions under Article 226 of the Constitution were entertained and the results of the Elections were set aside for some stated reasons. In the decision reported in AIR 1987 Madras 60 (A.Swamickan vs. K.Venkatachalam), a Division Bench of this Court declared that Thiru.K.Venkatachalam who got elected as a Member of Legislative Assembly, was not qualified to sit as a Member of the Legislative Assembly in Tamil Nadu, as he did not possess the basic qualifications prescribed in Clause (c) of Article 173 of the Constitution read with Section 5 of the Representation of People Act, 1951. The Division Bench held that the said Thiru.Venkatachalam was not an Elector of the concerned constituency and therefore, did not possess the necessary qualification to be chosen from that constituency and such a declaration and the ultimate decision was rendered by this Court in exercise of its jurisdiction under Article 226 of the Constitution, though a learned single Judge in that case dismissed the Writ Petition on the ground that it was not maintainable under Article 226 of the Constitution of India, in view of the constitutional bar contained in Clause (b) of Article 329 of the Constitution. The Supreme Court, in the decision reported in AIR 1999 SC 1723 (K.Venkatachalam vs. Swamickan) affirmed the said decision of the Division Bench of this Court by holding that Article 226 of the Constitution of India is couched in widest possible term and unless there is a clear bar to the jurisdiction of the High Court, its power under Article 226 of the Constitution can be exercised when there is any act which is against any provision of law or violative of constitutional provisions and when re-course cannot be had to the provisions of the Act for the appropriate relief. The Supreme Court also held that in the circumstances like the one involved in that case, the bar of Article 329(b) of the Constitution would not come into play.
27.Considering the arguments advanced by either side along with the above cited decisions, there are 15 Directors in the first defendant Society/first revision petitioner herein, out of which, one is elected as Chief Executive Officer and out of 14 directors, the plaintiffs/respondents 1 to 9 herein are the nine directors and since they are absent for three consecutive meetings held on 19.06.2013, 08.07.2013 and 19.07.2013, they were disqualified. But even on the first meeting, which was held on 19.06.2013, the respondents 1 to 9 sent a letter to the Secretary (In-Charge), IMPCOPS as to how they prevented from attending the meeting and they want to conduct general body meeting instead of board meeting. However, on 19.06.2013, the first meeting was conducted with five Directors and for want of Coram, it was adjourned to 08.07.2013. When the second meeting was held on 08.07.2013, at that time, the respondents 1 to 9/plaintiffs again sent the letter to the Secretary (In-Charge), IMPCOPS, not to conduct the meeting. Even though the second Board Meeting was held on 08.07.2013, it was adjourned for want of coram. Before the third meeting (i.e.) on 19.07.2013, the respondents 1 to 9 filed a suit in O.S.No.3882 of 2013 for declaring that the Board Meetings of first defendant Society held on 19.06.2013 and 08.07.2013 are null and void for want of corum as per bye law 44(3) of the first defendant Society and for permanent injunction restraining the defendants 2 to 4 from passing a resolution disqualifying the Plaintiffs as per bye law 39(1)(m) and removing them from Board of IMPCOPS; illegally contenting that the plaintiffs have absented themselves from three consecutive Board Meetings held on 19.06.2013, 08.07.2013 and 19.07.2013 and granting permanent injunction restraining the defendants 2 to 4 from conducting the Board Meeting on 19.07.2013 as proposed in the notice of Meeting dated 09.07.2013, without requisite corum as per bye law 44(3) of IMPCOPS and to direct the fourth defendant to convene a Board Meeting to consider the subject of convening a Special General Body Meeting of IMPCOPS to consider the removal of 2nd and 3rd defendants from the membership of IMPCOPS. The third meeting has been conducted on 19.07.2013 that too fully aware of the dispute between the respondents 1 to 9 and the society. In such circumstances, I am of the view, the matter is not fit for arbitration and it can be decided only by the Civil Court, which has jurisdiction to entertain the suit. Therefore, there is no reason for striking out the plaint in O.S.No.4515 of 2013. Since the Civil Court has jurisdiction, the interim orders passed by the trial Court in I.A.Nos.12049 and 12050 of 2013 are sustainable. Hence, the civil revision petitions are dismissed as devoid of merits and they are hereby dismissed.
28.In fine, The Civil Revision Petitions are dismissed.
The revision petitioners are at liberty to file their counter and adjudicate the same before the trial Court.
The trial Court is directed to dispose of I.A.Nos.12049 and 12050 of 2013 on merits without influenced by the findings observed by this Court.
Consequently, connected Miscellaneous Petitions are closed. No costs.
21.07.2014 Internet:Yes kj To XII Assistant City Civil Court, Chennai.
R.MALA,J.
Kj Pre-delivery order made in C.R.P(PD).Nos.3353 to 3355 of 2013 and M.P.Nos.1,1,1 of 2013 21.07.2014 CRP ( PD ) Nos.3353 to 3355 of 2013 R.MALA, J.
Today, while pronouncing the Judgment, the learned counsel appearing for the revision petitioners wants early disposal of the applications.
2. Considering the request made by the learned counsel appearing for the revision petitioners, the trial Court is directed to dispose of I.A.Nos.12049 and 12050 of 2013 within a week from the date of receipt of a copy of this order.
21.07.2014 ogy