Andhra HC (Pre-Telangana)
D. Srinivasa Rao And Others vs Govt. Of A. P. And Others on 8 June, 1990
Equivalent citations: AIR1991AP112, AIR 1991 ANDHRA PRADESH 112, (1991) 1 BANKCLR 242, 1991 COOPTJ 432, (1990) 2 APLJ 246, (1990) 2 ANDH LT 464
ORDER
1. The petitioners in these writ petitions are the Presidents of the various District Co-operative Central Banks. They all pray for issue of a writ of mandamus declaring that S. 21-A of the Andhra Pradesh Cooperative Societies Act, 1964, in so far as it seeks to impose disqualification upon the delegates does not apply to all levels of the Co-operative Credit Societies, including the Co-operative Central Banks at District and State level.
2. The above is the original prayer in W.P. 18212/89, which is sought to be amended by W.P.M.P. No. 987/90, filed on 24-1-1990, to the following effect :--
"And also to declare S.21-A of the A.P. Co-operative Societies Act, 1964, as amended, and Rule 24(1)(b) as ultra vires."
3. Not content with the first amendment petition, the petitioners have filed another petition, W.P.M.P. No. 5804/89 on 31-3-1990 seeking a further amendment to the prayer in the writ petition, which is to the following effect:--
"To issue a writ or order or direction declaring that the A.P. State Co-operative Bank (Formation) Act, 1963, the scheme framed under the said Act and Bye-laws registered under the said Act are applicable to the A.P. State Co-operative Bank or alternatively to declare S. 21-A of the A.P. Cooperative Societies Act, 1964 and R. 24 of the A.P. Co-operative Societies Rules 1964 as unconstitutional and to pass such other order or orders as this Hon'ble Court may deem fit and proper in the circumstances of the case."
4. It is thus evident that the petitioners seek far-reaching amendments to the prayer in the writ petition which are not in consonance with each other. In fact, we are constrained to observe- that in the light of the amendment petitions filed the main object of the writ petition has been rendered vague and nebulous thereby making it difficult to understand that actual purpose which the petitioners seek to achieve in these writ petitions. However, taking into consideration the running theme of the main case of the petitioners, we propose to deal with the contentions as raised by the learned counsel for the petitioners in the light of the actual provisions of the A.P. Co-operative Societies Act, 1964 and the Rules framed thereunder.
5. In a matter of this nature it would be appropriate to narrate the details given in the affidavit filed in support of the writ petitions to indicate the ultimate controversy arising in the matter.
6. The petitioners are the elected Presidents of Primary Agricultural Co-operative-Societies and delegates to the District Co-operative Central Banks. In their elected capacity as Presidents of District Co-operative Banks they become members of the General Body of the Andhra Pradesh State Co-operative Bank, Hyderabad and the Committee of the same Bank. It is alleged that with the introduction of the single Window system of providing credit through co-operatives and due to several inconsistent and contradictory statements in the Act, grave and unavoidable hardships have crept into the structure and organisation of the Bank and its affiliation. S. 21-A of the A.P. Cooperative Societies Act, 1964, as introduced by A.P. Act 14 of 1966, which deals with disqualification of the members of the executive and degates to a federal co-operative society, cannot be applied to the State Cooperative bank since it was constituted by a separate Act. However, since steps are being taken to wrongly apply the said Act, the present writ petition is filed. Thereafter, the affidavit filed by the petitioners proceeds to give details about the functioning of the Cooperative Credit Society and the liability of its members. It is stated that the Co-operative Central Bank is a society created for a District. The Central Bank is a financing bank for the village level societies. Its members are the primary societies. Its General Body is composed of delegates sent by its member societies and President and Committee are elected by them. At the State "level a Cooperative Society is registered. It is called State Co-operative Bank or Apex Bank. Its members are District Co-operative Central Banks and the Government. The delegates of District Co-operative Banks constitute its General Body and they elect the President and Committee. Both the District Co-operative Central Bank and the State Co-operative Bank are classified as Federal Societies and financing Banks. The State Co-operative Bank borrows from the National Agricultural Development Bank and lends to the District Co-operative Banks, which is for short term and medium term purposes. These societies are directly affiliated to the State or Apex level Central Land Mortgage Bank, re-designated as Central Agricultural Development Bank. The delegates of the Taluq level Land Mortgage Banks (Agricultural Development Banks) constitute the General Body of the State level society and elect their office bearers. For the Andhra area of the State, the A.P. Co-operative Societies Act of 1932 applied. For the Telangana area, Co-operative Societies Act of 1952 applied. The Land Mortgage Banks in either area were governed by the respective Co-operative Societies Act. Thus, till 24-2-1964 there were two different Acts in the respective regions. In order to constitute a State level Central Bank by amalgamation of the Andhra and Hyderabad State level co-operative Banks a special law was enacted. It is called "The A.P. State Cooperative Bank (Formation) Act, 1963 (A.P. Act XII of 1963)". The A. P. State Co-
operative Bank is constituted u/S. 3 thereof in pursuance of a statutory scheme framed by the Registrar and supplemented by bye-laws registered under the A. P. Co-operative Societies Act of 1932. U/S. 5 of the said Act, the Government is empowered to frame the Rules and u/S. 6 to adopt, repeal or modify the then existing Act. S. 7 provides that the Act shall have effect notwithstanding anything inconsistant with the Co-operative Societies Act in force in either area. The Act has come into force on 4-12-1962 and a scheme framed by the Registrar, was ratified by the General Bodies of both the Banks and certified by the Registrar. Cl. 5 of the Scheme provides that the membership of the amalgamated bank on its formation shall consist of (1) the Co-operative Central Banks registered as such and affiliated to the Andhra State Co-operative Bank, (2) the Co-operative Central Banks registered as such and affiliated to the Hyderabad State Co-operative Bank and (3) the Government of Andhra Pradesh. The bye-laws were registered on 19-7-1963 by the Registrar in accordance with the procedure under the Andhra Pradesh Co-operative Societies Act of 1932 (Act 6 of 1932) and the Bank commenced its work. Under Bye-law 7 the membership consists of District Cooperative Central Banks and the Government. Under Bye-law No. 24 the General Body consists of the representatives of the District Co-operative Central Banks and the nominees of the Government. Bye-law No. 29 deals with Board of Management or Committee i.e., the 22 District Banks having each one delegate and the Government nominates three delegates of its own. The Managing Director is ex-officio member. Hence, it is clear that in a sense the General Body as well as the Committee of the A.P. State Bank are co-extensive as they comprise of the delegates of the District Co-operative Central Banks.
7. The Andhra Pradesh Co-operative Societies Act, 1964 (Act No. 7 of 1964) came into force on 24-2-1964. Under the said Act, the Co-operative Societies Act of 1932 which was in force in Andhra area, has been repealed and similarly the Co-operative Societies Act of 1952, which was in force in Telangana area, also has been repealed but there is no express provision of the repeal of the Formation Act (A.P. Act 12 of 1963). Several amendments have been effected under the A.P. Co-operative Societies Act of 1964 from time to time. U/S. 130 of the A,P. Cooperative Societies Act of 1964, the Government has got power for carrying out the purposes of the Act. Under Rules 24(b) and 30(c) of the Rules framed under the said Act disqualification has been provided (Sic) member of the Committee if he is personally in default to any society or is a delegate of a society which is in default for a period exceeding 3 months. The Committee membership ceases under R. 24(b) and the delegate ceases as such to be a delegate under R. 30(c). The contention of the petitioners is that when such disqualifications are made applicable to the Apex or State level Central Bank it results in grave anomolies as in the event of any default committed by the primary societies to the District Co-operative Central Banks, they could not, in their turn, pay in time to the appex Bank resulting in the disqualification of the delegates to be on the Committee as well as on the General Body resulting in a stalmate in the functioning of the institution. The main contention of the petitioners is that a vacuum is thus created in the Committee as well as in the General Body for want of representatives. Even though a person in charge can be appointed u/S. 32(7) of the A.P. Co-operative Societies Act of 1964 to exercise the powers of the Committee, he cannot exercise the powers of the General Body, relating to annual report, audit report, approval of the annual budget and amendment of bye-laws etc., which are exclusively within the domain of the General Body. Therefore, the apprehension of the petitioners is that a disqualification from the membership of the Committee automatically results in the disqualification of the membership of the General Body as well and renders the whole body defunct as such.
8. The petitioners place great reliance upon the fact that exemptions u/S. 123 of the A.P. Co-operative Societies Act from the operation of the provisions of S.21-A have been granted from time to time. It seems, during the proposed elections in 1981-82, first exemption was granted to enable the defaulters and delegates of defaulting societies for a period of one year so as to enable the delegates to participate in the elections. These exemptions have been granted on several grounds, such as re-organisation of primary Agricultural Co-operative Society under the viability programme, on the happening of calamities like drought, floods and cyclones etc.
9. It may not be necessary to go into all the details of the exemptions which have been granted by the Government from 1981 onwards but suffice it to say that it is a fact that upto 31-12-1984 exemptions were granted continuously. During the year 1984-85 general elections to the State Assembly and Parliament were to be held and the elections to the Managements of the Co-operatives were postponed. Persons-in-charge were appointed u/S. 32(7) of the A.P. Co-operative Societies Act to carry on the management of the societies. Thereafter the scheme of single window system was introduced by making an amendment in he A.P. Co-operative Societies Act of 1964 by A.P. Amendment Act 1 of 1987. Consequent upon such amendment, the functions were entrusted to the re-organised Primary Agricultural Credit Societies which are affiliated to the District Co-operative Central Banks. The Primary bodies continued to borrow both long term and short term loans from the District Central Banks, which, in their turn, borrow short term loans from the State Co-operative Bank and long term loans from the State Co-operative Agricultural Development Bank. S.21-A(2) of the A.P. Co-operative Societies Act, 1964 was amended by A.P. Act 10 of 1970 prohibitinga person from being a member of a Committee of more then two Central Societies or more than one Apex society. U/S. 25(4) it is provided that only the President of the Society can be its delegate. The petitioners laid great stress on the fact that according to them the General Body and the Committee is co-extensive in number and if a delegate ceases to be a member of the Committee he also ceases to be a member of the General Body thereby rendering the whole system defunct. The petitioners also state that the Government is aware that in spite of best efforts put by the societies they could not realise even 50% of the dues in the past several years and many societies continue to commit defaults to District Co-operative Central Banks and Central Banks to Apex Banks thereby insisting exemptions which were granted liberally under the provisions of S. 123 of the Act from the operation of S.21-A of the Act.
10. The reasoning of the learned counsel for the petitioners, Sri M. V Ramana Reddy is that if the exemptions are not granted and S. 21-A of the A.P. Co-operative Societies Act is made applicable a vacuum will be created since no one can represent the District Co-operative Central Bank in the General Body of the A.P. State Co-operative Bank and A.P. Co-operative Central Agricultural Development Bank. The petitioners further state that they have submitted a memorandum dated 22-12-1989 to the respondents to consider the matter and to exercise the powers of exemption under the Act, which has not been favourably considered.
11. The main submission made by the learned counsel for the petitioners is that S. 21-A does not apply to the A.P. State Cooperative Central Bank since it is governed exclusively by the provisions of the Formation Act of 1963 and the scheme and the bye-laws thereunder which do not provide for any such disqualification. The Formation Act incorporates the provisions of A.P. Cooperative Societies Act, 1932 for the purpose of registration of the bye-laws. Such registration having been done, the Bank acquired a corporate status and it is governed by the provisions of the Formation Act and the scheme alone. There are no disqualifications under the A.P. Co-operative Societies Act, 1932 or the Formation Act or the scheme and the Formation Act is still in force. In this view of the matter the petitioners challenge the application of S. 21-A of the A.P. Cooperative Societies Act, 1964, as inserted by A.P. Act No. 14 of 1966 and the provisions of S.21-A(2) as amended by Act 10 of 1979 as being arbitrary and repugnant to the single window system introduced under Act 1 of 1987.
12. The petitioners have sought for amendments of the prayer in the writ petition during the course of arguments which have already been reproduced above. In the amendment proposed in W.PM.P. No. 987/ 90 a challenge is made to S. 21-A of the A.P. Co-operative Societies Act, 1964 as amended by A.P. Act No. 14 of 1966 and A.P. Act 10 of 1970, As being opposed to Arts. 14 and 21 of the Constitution of India. The object of the second amendment proposed through W.P. M.P. No. 5804 of 1990 is for a declaration that the A.P. State Co-operative Bank (Formation) Act, 1963, the scheme framed under the said Act and the Bye-laws registered under the said Act are applicable to the A.P. State Co-operative Bank or in the alternative the petitioners pray that S. 21-A of the A.P. Cooperative Societies Act, 1964 and R. 24 of the A.P. Co-operative Societies Rule 1964 may be declared as being unconstitutional.
13. We are, however, inclined to take a rather liberal view of the entire matter and allow the amendment petitions for whatever they are worth to deal with the main controversy arising in these writ petitions.
14. Sri M. V. Ramana Reddy, learned counsel for the petitioners has persistently submitted that the Andhra Pradesh State Cooperative Bank (Formation) Act, 1963 has not been repealed and since it provides the application of the Co-operative Societies Act of 1932 the matter should be continued to the governed by the provisions of the Cooperative Societies Act of 1932 alone. It may be seen that the Andhra Pradesh State Cooperative Bank (Formation) Act, 1963 was promulgated with the following statement of objects and reasons:
"Just before the reorganisation of State, the Hyderabad State Co-operative Bank was reconstituted by the Andhra Pradesh (Telan-gana Area) State Co-operative Societies (Reconstitution) Act, 1956 (XL11 of 1956) so as to confine its area of operation to the Telangana area. With effect on and from 1st November, 1956, two Apex Co-operative Banks have been functioning in the State of Andhra Pradesh, namely, the Andhra State Co-operative Bank Ltd., in the Andhra Area, and the reconstituted Hyderabad Co-operative Apex Bank Limited in the Telangana Area. One of the recommendations made at the informal conference held by the Reserve Bank of India in May 1956, was that there should be only one State Co-operative Bank in each re-organised Slate. In order to give effect to the above recommendation it is proposed to provide for the formation of the Andhra Pradesh State Co-operative Bank Limited for the whole of the State, by amalgamation of the Andhra State Cooperative Bank Limited and the Hyderabad Co-operative Apex Bank Limited."
The main object of the A. P. State Cooperative Bank (Formation) Act, 1963 is, therefore, to provide for the formation of the Andhra Pradesh State Co-operative Bank Limited for the whole of the State by amalgamation of the Andhra State Cooperative Bank Limited and the Hyderabad Co-operative Apex Bank Limited. It is only an Act which provides for the formation of the above said Bank. Its main object and the reason for which it has been enacted is achieved once the formation takes place after the amalgamation of the Andhra State Cooperative Bank Limited and the Hyderabad Co-operative Apex Bank Limited and there is no other purpose which the Act is to serve apart from the sole object for which it has been enacted. It is also to be seen that u/S. 3 of the said Act it is provided that after the commencement of the Act, the Registrar shall place separately before a meeting of the general body of the Andhra Co-operative Bank and a meeting of the general body of the Hyderabad Co-operative Bank, specially convened by him, a scheme prepared by him, which shall contain proposals for the amalgamation of those Banks to form a single bank, called "the Andhra Pradesh State Cooperative Bank Limited". Under sub-sec. (2) of S. 3 it is provided that if the scheme prepared by the Registrar is approved by a resolution passed by a majority of the members present and voting at each of the said meetings, the scheme shall be final and binding on the Andhra Co-operative Bank and the Hyderabad Co-operative Bank. Sub-sec. (3) of S. 3 is significant for the purpose of the instant case and may be re-produced as hereunder:
"(3) After the certification of the scheme u/sub-sec. (2), the Registrar shall register the Andhra Pradesh Co-operative Bank and its bye-laws under the Co-operative Societies Act of 1932."
It is thus evident from a reading of sub-sec. (3) of S. 3 that the Andhra Pradesh Co-operative Bank and its bye-laws are registered under the Co-operative Societies Act of 1932. Sub-sec, (ii) of S.4 provides that the co-operative societies registered or deemed to have been registered under the Co-operative Societies Act, 1952, shall, for the purpose of membership of the Andhra Pradesh Co-operative Bank and in their transactions therewith, be deemed to have been registered under, and be governed by, the provisions of the Cooperative Societies Act of 1932. Therefore, it is clear that even those Co-operative Societies which were registered under the Co-operative Societies Act of 1952 are deemed to have been registered under and are governed by the provisions of the Co-operative Societies Act of 1932. S. 6 deals with the question of power of adaptation and provides that for the purpose of giving effect to the provisions of the Formation Act, the Government may make such adapations and modifications of the Co-operative Societies Act of 1932 and the Co-operative Societies Act of 1952 and the Rules made thereunder, whether by way of repeal or amendment, as may be necessary or expedient. Overriding effect of the Formation Act of 1963 is provided u/ S. 7 of the said Act by virtue of which the provisions of the Formation Act" shall have effect notwithstanding anything inconsistent therewith in the Co-operative Societies Act of 1932 and the Co-operative Societies Act of 1952.
15. We have given the general scheme of the legislation as enacted in the A.P. State Co-operative Bank (Formation) Act, 1963 to enable us to fully appreciate the impact of the argument of the learned counsel for the petitioners that since the Formation Act of 1963 has not been repealed, the matter on hand continues to be governed by the Cooperative Societies Act of 1932. This assumption of the learned counsel for the petitioner, in our opinion, is throughly misconceived for the following reasons:
The Andhra Pradesh Co-operative Societies Act, 1964(Act No. 7 of 1964) had received the assent of the President on 24th February, 1964 and was published in the Andhra Pradesh Gazette on 25th February, 1964. U / S. 132 of the said Act repeal and savings of various enactments have been provided. It would be in the fitness of things to re-produce S. 132 which is in the following terms:
"132. Repeal and savings:-- The following Acts namely:-- (1)the Andhra Pradesh (Andhra Area) Co-operative Societies Act, 1932, (2) the Andhra Pradesh (Andhra Area) Cooperative Land Mortgage Act, 1934, (3) the Andhra Pradesh (Telangana Area) Co-operative Societies Act, 1952 are hereby repealed:
Provided that any society existing at the commencement of this Act which has been registered or deemed to have been registered under the relevant repealed Act shall be deemed to have been registered under this Act and the bye-laws of such society shall, so far as they are not inconsistent with the provisions of this Act or the rules made thereunder, continue to be in force until altered or rescinded in accordance with the provisions of this Act and rules made thereunder:
Provided further that S.8 of the Andhra Pradesh General Clauses Act 1891, shall be applicable in respect of the repeal of the said enactments and S. 8 and 18 of the said Act shall be applicable as if the said enactments had been repealed and re-enacted by an Andhra Pradesh Act."
Thus, under the A.P, Co-operative Societies Act of 1964 the Andhra Pradesh (Andhra Area) Co-operative Societies Act, 1932, the Andhra Pradesh (Andhra Area) Co-operative Land Mortgage Act, 1934 and the Andhra Pradesh (Telangana Area) Co-operative Societies Act, 1952 stand repealed. The fundamental point to be considered, therefore, is that when the Act of 1932 has been expressly repealed by the provisions of S. 132 of the A. P. Co-operative Societies Act of 1964, how can it be said that the Act of 1932 will still continue to govern the affairs of the societies which have come into being as a result of the amalgamation under the Formation Act of 1963. The argument advanced by the learned counsel for the petitioners that since the Formation Act of 1963 under which the scheme promulgated by the Registrar has been registered under the Co-operative Societies Act of 1932, the provisions of the Cooperative Societies Act of 1932 shall continue to govern the situation is throughly misconceived and untenable in the eye of law. An enactment, which has been repealed expressly by a later Statute, cannot be deemed to be operative for any purpose unless there is a saving clause making such a statute operative in certain respects. More over, it may be seen that under the proviso to S. 132 it is clearly stated that any society existing at the commencement of the A.P. Co-operative Societies Act of 1964 which has been registered or deemed to have been registered under the relevant repealed Act shall be deemed to have been registered under the Act of 1964 and the bye-laws of such society shall, so far as they are not inconsistent with the provisions of this Act or the rules made thereunder, continue to be in force until altered or rescinded in accordance with the provisions of 1964 Act. It is, therefore, crystal clear that u/S. 132 of the A.P. Co-operative Societies Act of 1964 under which the A.P. (Andhra Area) Cooperative Societies Act of 1932 and the Andhra Pradesh (Telangana Area) Co-operative Societies Act of 1952 have been repealed, it is provided that the societies which were existing at the commencement of the A.P. Co-operative Societies Act of 1964 which have been registered or deemed to have been registered under the relevant repeated Act shall be deemed to have been registered under the Act of 1964 and they will be governed in accordance with the provisions of the said Act of 1964. Now, the position is clear that under the Formation Act of 1963 amalgamation has taken place and the scheme after the amalgamation prepared by the Registrar has been registered under the Act of 1932. The Cooperative Societies which have come into being as a result of the amalgamation were to be governed by the provisions of the Cooperative Societies Act of 1932. The Cooperative Societies Act of 1932 has been repealed by the Co-operative Societies Act of 1964, and it is provided that the societies which were registered at the commencement of the 1964 Act under any of the repealed enactments will be deemed to have been registered and will be governed by the A.P. Co-operative Societies Act of 1964. Hence, the end product of the above discussion is that there is no force in the argument of the learned counsel for the petitioners, Sri M. V. Ramana Reddy, that the Act of 1932 still continues to govern the affairs of the cooperative societies registered under the 1932 Act and that 1964 Act is not applicable to such cases. Therefore, our first conclusion arrived at in the case is that the Andhra Pradesh Co-operative Societies Act of 1964 (Act No. 7 of 1964) is applicable with full force to the District Co-operative Central Banks, which have come into being as a result of the amalgamation of the Andhra Cooperative Bank and the Hyderabad Cooperative Bank under the Andhra Pradesh State Co-operative Bank (Formation) Act, 1963.
16. The next submission made by the learned counsel for the petitioners is that S.21-A of the A.P. Co-operative Societies Act of 1964, as amended by A.P. Act 14 of 1966 and A.P. Act 10 of 1979, is void as it violates Arts. 14and 19 of the Constitution of India. He further contends that u/S. 21-A(1)(b) the period of default is not specified for elected member of the Committee and by delegating the power to the Government the Legislature has abdicated its essential legislative policy and is, therefore, void and ultra vires. He also challenges the rule making power and impugns R.24(1)(b) of the A.P. Co-operative Societies Rules, 1964, as being void and ultra vires S.21-A of the A.P. Cooperative Societies Act of 1964.
17. S.21-A(1)(b) of the A.P. Co-operative Societies Act, 1964, substituted by A.P. Act No. 14 of 1966 and added by A.P. Act No. 10 of 1970, is as follows :--
21-A. Disqualification for membership of Committee :--
(1) No person shall be eligible for being chosen as, and for being, a member of the committee, if he -
(a) xx xx xx xx xx xx xx
(b) is in default in the payment of any amount due in cash or kind to the society or any other society for such period as may be prescribed or is a delegate of a society which is defunct or which is in default as aforesaid;
XX XX XX XX XX XX XX Provided that any delegate of a society sitting on the committee of any other society, shall cease to be such delegate, if -
XX XX XX XX XX XX XX XX
(iii) the society of which he is the delegate is defunct or commits default in the payment of any amount due in cash or kind to such other society for the period prescribed;
XX XX XX XX XX XX".
It is, therefore, evident that S. 21-A deals with the question of disqualification for membership of committee and provides that no person shall be eligible for being chosen as, and for being, a member of the committee if he is in default in the payment of any amount due in cash or kind to the society or any other society for such period as may be prescribed or is a delegate of a society which is defunct or which is in default as aforesaid. It may be stated here itself that u/R.24(1)(b), framed under sub-sec. (1) of S. 130 of the A.P. Cooperative Societies Act, 1964, it is provided that a person shall be disqualified for election as or for being a member of the committee of any society if he is in default to the society or to any other society for such period as is specified in the bye-laws of the society concerned, or in any case for a period exceeding three months, or is a defaulter to the society or to any other society or is a delegate of a society which is defunct or is in default for a period exceeding three months. Therefore, while the section provides that a person shall not be eligible for being chosen as, and for being, a member of the committee if he is in default of any amount for such period as may be prescribed, the period itself has been mentioned in R. 24(1)(h) fixing the outer limit of a period of three months for a person to incur such disqualification. It is no where stated in the section that the disqualification incurred u/S. 21-A will extend to the disqualification of the person concerned for the membership of the society. Indeed, it may be seen that disqualification for membership of the society is dealt with u/ S. 21 of the Act and a person incurs disqualification if he comes within the categories which have been enumerated in S. 21 but in so far as the question of disqualification of the membership of the committee is concerned, that matter arises only u/S. 21-A. The fundamental premise of the learned counsel for the petitioners for attacking the validity of S. 21-A is that a disqualification for membership of the committee automatically results in the disqualification of the person concerned from the general membership of the society. This interpretation is clearly untenable and misguided. So much so even in the courier-affidavit filed in this case it is clearly stated as follows:--
".....It is further submitted that the contention of the petitioners that if the society defaults, the delegate of that society shall cease to be on the Committee and as well as the General Body of the District Co-operative Central Bank, is not correct. S. 21-A and the proviso made thereunder only disqualifies the delegates of the defaulting society from sitting on the committee of the District Co-operative Central Bank....."
In a later paragraph in the counter-affidavit it is further stated as follows:--
"It is submitted with reference to para 24 that the petitioners are confusing the terms of general body and managing committee. General body of the society consists of all members as per S. 2(j) of the Andhra Pradesh Co-operative Societies Act. The members of the District Co-operative Central Bank are Primary Agricultural Credit Societies and Prasident is only delegate elected to represent the society in terms of S. 25(4) of the Andhra Pradesh Co-operative Societies Act in the General Body of the Bank. Unless the President incurs personal disqualification for default, he cannot cease to represent the society in the General Body of the Bank, even though the society is in default to District Co-operative Central Bank. S.21-A(1)(b) prescribes disqualification to be in the Committee of the District Co-operative Central Bank. Therefore, any society committing default and whose delegate sitting on the committee has to vacate the seat, but the same delegate can represent in the General Body. Therefore, the assumption of the petitioners that there will be no General Body is not correct. It is further submitted that in the case of Apex Body the District Co-operative Central Banks are the members of the Committee and also the General Body. If the District of Co-operative Central Bank Commits default the delegate cannot sit in the managing committee of Apex Bank but there is no bar to come for the General Body Meeting and the General Body can discharge its functions. The functions of the General Body and Managing Committee are different and distinct. The committee is like an executive whereas the General Body is the policy making body. If there is no committee, the Act contemplates the appointment of Person-in-charge. If all the District Co-operative Central Banks commit default they cannot sit and transact the business as committee but they can contnue to be the members of the General Body. Therefore, the contentions of the petitioners that vacuum will be created is not correct."
In view of this clear position of law, we are unable to see any force in the argument advanced by the learned counsel for the petitioners that the cessation of the membership of the Committee u/S. 21-A automatically results in the cessation of the membership of the General Body of the society also. Once this fundamental principle is affirmed, the main contention of the learned counsel for the petitioners stands negatived.
18. The further contention of the petitioners is that the Legislature has abdicated its powers by delegating the power to Government to specify the time under R. 24(1)(b) of the A.P. Cooperative Societies Rules, 1964 on the expiry of which a person shall incur disqualification for election as and for being a member of the committee by fixing a period of three months as prescribed therein. The A.P. Co-operative Societies Rules, 1964 have been framed u/S. 130 of the A.P. Co-operative Societies Act, 1964. U/S. 130 it is provided that the Government may, by notification published in the Andhra Pradesh Gazette, make any rules for carrying out all or any of the purposes of the Act for the whole or any part of the State and for any class of societies. R. 24(1)(b) has been framed with a view to disqualify a person from the membership of the Committee. It is evident that S. 21 deals with the disqualification for membership of society and S. 21-A deals with the disqualification for membership of committee. We are primarily concerned here with the question of cessation of membership of the committee as arising under the provisions of S. 21-A. In S. 21-A(1)(b) it is stated that no person shall be eligible for being chosen as, and for being a member of the Committee, if he is in default in the payment of any amount due in cash or kind to the society or any other society for such period as may be prescribed or is a delegate of a society which is defunct or which is in default as aforesaid. The section itself does not lay down the period of time on the expiry of which a person is to incur the disqualification for membership of the committee but it provides "period as may be prescribed". That period has been prescribed in R. 24(1)(b) which has been substituted for the original clause by G.O. Ms. No. 1808, Food & Agriculture Department, dated 2nd July, 1965.
19. We have given our anxious consideration to the plea of the abdication of powers by the Legislature by delegating the power to the Government to specify the time under R. 24(1)(b) of the A.P. Co-operative Societies Rules on the expiry of which a person shall incur disqualification for election as and for being a member of the committee. We do not see much force in the contention raised by the learned counsel for the petitioners that the Legislature has abdicated the powers in favour of the rule making authority. It is evident that under the general scheme of any legislation matters of deatails are filled in by virtue of the rule making power delegated to the Government or the concerned authority. The main guidelines are provided in the enactment and the details with regard to the period of time required for incurring any disqualification or such other matters as may be specified therein are left to be filled in by virtue of the rules that may be framed under the Act. From this point of view we do not see any force in the contention of the learned counsel for the petitioners that the Legislature has abdicated its powers while delegating the power to fix the time limit under the rules as such.
20. The next submission, however, made by the learned counsel for the petitioners is that S.21-A has been inserted by A.P. Act No. 14 of 1966 whereas R. 24(1)(b), specifying the period of three months, has been substituted as per G.O.Ms. No. 1808 Food & Agriculture Department, dated 2nd July, 1965. This, in effect, means that the rule has preceded S. 21-A which deals with the question of disqualification for membership of committee. When there was no provision at the time when the rule was made for disqualification for membership of the committee albeit it within a certain specified period of time the question is, how can a rule be framed providing for such a contingency which will result in the disqualification for membership of the committee. To substantiate his argument on this point, the learned counsel for the petitioners has relied on a decision of the Supreme Court reported in General Officer. Commanding-in-Chief v. Subhash Chandra wherein it is held that R. 5-C providing for transfer of employees of Con-tonment Board is ultra vires the Act. The reason for striking down R. 5-C is that it was inserted in the Rules by a Notification dated November 23, 1972 providing for the transfer of the employees of the Cantonment Boards which, on the face of it, is contrary to the rule rule making power of the Central Government as it stood before the amendment of the Act in 1983. Cl. (c) of sub-sec. (2) of S. 280, before the amendment of Cantonments Act, was to the following effect:
"(c) the appointment, control, supervision, suspension, removal, dismissal and punishment of servants of Boards."
Under these circumstances, the Supreme Court held that before the amendment, cl. (c) did not confer upon the Central Government power to frame rules regarding conditions of service which necessarily include transfer of the employees of the Boards. R. 5-C, which was inserted in the Rules by a notification dated November 23, 1972 providing for the transfer of the employees of the Cantonment Board, was held to be contrary to the rule making power of the Central Government as it stood before the amendment of the Act in 1983. In the instant case the situation is that S. 21-A dealing with the disqualification for membership of the committee has been inserted by A.P. Act No. 14 of 1966. However, R. 24 (1)(b) dealing with the question of disqualification for election as or for being a member of the committee of any society which is defunct or is in default for a period exceeding three months, has been substituted for the original clause by G.O.Ms. No. 1808, Food & Agriculture Department, dated 2nd July, 1965 and is, therefore, clearly beyond the scope of the rule making power under S. 130 of the A.P. Co-operative Societies Act which provides power for making rules to carry out all or any of the purposes of the Act. It is, therefore, evident that at the time when R. 24(1)(b) was framed, S. 21-A was not present in the Act and, therefore, any rule framed to carry out the, purpose which is nonexistent under the Act at the time of the promulgation of the rules cannot be sustained in the eye of law. On this ground alone we are inclined to hold that R. 24(1)(b) is ultra vires the power of the rule making authority and is, therefore, liable to be struck down. However, nothing contained herein shall preclude the appropriate authority to frame a fresh rule giving effect to the provisions of S. 21-A of the A.P. Co-operative Societies Act dealing with the question of disqualification for membership of committee.
21. In the result, W.P.No. 18212 of 1989 is allowed to the extent as indicated above. In the circumstances of the case there will be no order as to costs. Advocate's fee Rs. 200/-.
W.P.No, 529 of 1990.
22. The facts in this writ petition are almost identical to those existing in W.P. No. 18212 of 1989 wherein the validity of R. 24(1)(b) of the A.P. Co-operative Societies Rules has been challenged and the said rule is held to be ultra vires the power of the rule making authority had struck down as such.
23. The prayer, however, in this writ petition is for the issue of a mandamus declaring S. 21-A(1)(b) and item (iii) of the proviso as illegal and void and to restrain the respondents herein from applying the same or in the alternative to direct the respondents to continue the exemption u/S. 123 of the A.P. Co-operative Societies Act from the provisions of S.21-A(1)(b) and item (iii) of the proviso. After an elaborate discussion in the earlier writ petition we have already held that S. 21-A(1)(b) does not suffer from any illegality and is perfectly intra vires the authority of the Legislature. Under these circumstances W.P.No. 529/90 is liable to be dismissed.
24. In the result, W.P.529/90 is dismissed but in the circumstances of the case there will be no order as to costs. Advocate's fee Rs.200/-.
25. Order accordingly.