Bombay High Court
Ahmednagar Zilha Sahakari Dudh ... vs State Of Maharashtra And Ors. on 3 March, 2000
Equivalent citations: 2002(1)BOMCR728
Author: D.S. Zoting
Bench: B.H. Marlapalle, D.S. Zoting
JUDGMENT D.S. Zoting, J.
1. Heard learned Counsel for the respective parties and the learned Assistant Government Pleader. Leave to delete respondent Nos. 4 and 5 in Writ Petition No. 852 of 1999 is granted.
2. Rule. Petitions are taken up for final hearing forthwith by consent of the parties.
3. In Writ Petition No. 941 of 1999 the petitioners is Ahmednagar Zilla Sahakari Dugdha Vyavasayik Va Prakriya Sangh Limited (Ahmednagar Zilla Sangh. For Short), a registered Federal Co-operative Society at the District level under the Maharashtra Co-operative Societies Act in the year 1958. Its area of operation covers seven Talukas in the Ahmednagar District namely Ahmednagar, Parner, Shrigondha, Karjat, Jamkhed, Pathardi and Sheogaon. Its Bylaws are duly approved by the competent authority and the Managing Committee consists of representatives from each one of these Talukas. It employs about 500 employees who are represented by a union registered under the Trade Unions Act. It has set up chilling plants in each of these Taluka places so as to cater to the local milk collection. The mike is collected and chiled in such chilling centres and excess quantity of milk, if any, is transferred to the chilling centres run by the State Government. Over a period of time it has established itself very well and has been paying dividends to its members. It also claims to here given bonus to the members from time to time i.e. increase in the milk price over and above the price fixed initially. The managing Committee also consists employees representatives as required under section 73-BB of the Maharashtra Co-operative Societies Act (the Act, for short).
4. The petitioner society has challenged the Government Resolution dated 6th February, 1990 as well as 2nd February 1990. The petitioner has also brought in question the notice issued by the Divisional Deputy Registrar. Co-operative Societies (Dairy), Nasik Division, Nasik on 5th February, 1999. It is the contention of the petitioner society that while it is functioning as a progressive federal society, solely devoted for the welfare of its members and the employees and also to strengthen the co-operation movement in Ahmednagar District, no other Taluka level milk union as a federal society should be registered within its area of operation of the said seven Talukas. It is also contended that the impugned policy decision confirming the continuation of three tier system of Milk Societies. Ensures the existence of the Zilha Sangh and registration of taluka Sangh for the talukas under its area of operation would be contrary to the spirit and objects of the said policy.
5. Writ Petition Nos. 852 of 1999, 5253 of 1999 and 5928 of 1999 are filed by the Chief Promoters of three different proposed taluka Co-operative Milk Unions for Karjat Taluka and even if the name of the proposed society in all the petitions is the same they are supposed to be different entities on the basis of the applications submitted by different Chief Promoters. In Writ Petition No. 852 of 1999 the Chief Promoter Shri Rajendra Eknath Nimbalkar has prayed for directions in the nature of prohibition not to consider any proposals for registration of Taluka level milk union for Karjat Taluka till the decision in Writ Petition Nos. 982 and 1247 of 1990 pending in this Court, is pronounced and has also prayed for quashing and setting aside the notice dated 4th February, 1999 issued by the respondent No. 2 in Appeal No. 2 of 1999. In Writ Petition No. 5253 of 1999 the petitioner-Chief Promoter Shri Rajaram Maroti Pisal has prayed for directions that the application filed by him on 3rd January, 1990 be deemed to have been allowed and the proposed Karjat Taluka Dudh Utapadak Va Prakriya Sangh Limited, Karjat be deemed to have been registered under section 9(1) of the Act and in the alternative to consider the proposal dated 3rd January, 1999 within a fixed period and issue necessary registration certificate. In Writ Petition No. 5928 of 1999 the Chief Promoter Shri Kailash Shankarrao Shewale has prayed for directions to issue certificate of registration to the proposed society initiated by him and he has claimed that his application has been pending before the competent authority right from 29th December, 1988. It also must be noted at this stage, that the petitioner in Writ Petition No. 852 of 1999 has granted permission to open account by an order dated 5th February, 2000 purportedly on the basis of the order passed by this Court on 23rd February, 1999. The said order granting permission has been challenged by the petitioner in Writ Petition No. 5253 of 1999 by filing Revision Application No. 2 of 2000 before the State Government and in the said revision the order dated 5th February, 2000 has been stayed, as is evident from the communication dated 16th February, 2000. Which is at Exhibit R/I in the said petition. The petitioner consequently has challenged the amended Writ Petition No. 5253 of 1999 and order dated 5th February, 2000. In Writ Petition No. 941 of 1999 the petitioner amended the petition consequent to the order passed by the Registrar on 5th February, 2000 and prayed for initiating contempt proceedings. These three petitioners viz. Writ Petition Nos. 852, 5253 and 5928 of 1999 are supporting the policy of the Government of Maharashtra as has been pronounced on 6th of January, 1990 and the clarificatory guidelines issued on 2nd February, 1990. In Writ Petition No. 5928 of 1999 the petitioner has disputed the claims made by the Ahmednagar Zilha Sangh regarding its infrastructures and the measures it has taken for its growth. It is alleged that the milk collection capacity in the seven talukas under the District Union is much more and the said union is not able to cater to the needs of the milk suppliers at the village level. A number of names have been given of the private dairies who have not only flourished in dairy business but even in by products in the very same talukas. The petitioner has also disputed the chilling capacity of the Zilha Sangh and stated that there have been instances where the village level milk producers/farmers are required to sell the milk at much lower rates and sometimes the milk is wasted thereby causing financial losses to the individual farmers at the grass root levels. These contentions has been raised to emphasise the need to register federal societies at taluka level and to support the Government policy impugned in Writ Petition No. 941 of 1999 on the ground that the availability of milk in these areas warrants more than one federal milk co-operative societies. We refrain to make any comments on these disputed questions of facts and it is not necessary for us to advert to these claims and counter claims to decide these petitions.
6. We may refer to the Government Resolution dated 2nd December, 1976 issued by the Government of Maharashtra recognising the existence of primary co-operative societies at the village level, federal societies at the taluka level and District level and the apex society at the State level. Thereby creating a three tier structure of milk producer co-operative societies. In the said Government Resolution it was made clear that the taluka level union will be economical and if it handled more than 10,000 litres milk per day a no objection certificate for registration will be given only to such societies. The said policy also made it clear that normally once a federal society is established, the Dairy Development Department would not accept milk directly from primary societies. It appears that the Government of Maharashtra, with an intention to strengthen the dairy development activity in the State, entered into an agreement with the Indian Dairy Corporation on 14th May, 1981 and decided to implement Operation Flood-II programme in the State. The said program was brought into effect from 17th April, 1982 and on 11th July, 1983 the State Government issued a Government Resolution to implement the said programme for 17 districts in the State and the Ahmednagar district was not included therein. On 11th December, 1985 the Government issued another Government Resolution and clarified that the Taluka level Unions which had a capacity of more that 50,000 litres per day for processing will only be retained and those taluka level unions which have capacity of less than the specified limit should be merged either with another taluka level union or with the district level unions. It was also clarified that the taluka level unions it was also clarified that the taluka and unions existing in the districts covered by the operation flood II programme will be merged with the district level unions. The Government, by notification dated 14th August, 1987 with drew the earlier resolution dated 11th December, 1985 and clarified that a taluka level unions with capacity of 20,000 litres and above will continue to exist and those unions at taluka levels who had the capacity of less than 20,000 litres per day should be merged with the District level union. It appears that the agreement of the Government of Maharashtra with the Dairy Development Board expired on 31st March, 1985 and during that period itself the Government had constituted a Committee and on the basis of the recommendations of this Committee the notification dated 14th of August, 1987 was issued.
7. By the impugned resolution dated 6th January, 1990 the Government has made it clear that the four-tier structure would not be continued and the dairy development scheme in the State would be administered in the three tier structure. The Government resolved that the milk producer society at the Taluka level as well as the district level will be known as a federal society and both of them will have independent existence and would be separately affiliated to the apex society at the State level. Between the primary society at the village level and the apex society at the State level there would be only one tier and i.e. either at the taluka level or the district level. While granting registration for a taluka level society it must be necessary to ensure that the capacity of such society was more than 20,000 liters per day and within a period of two years it ought to cross the collection capacity of 40,000 liters per day. In case such a target is not achieved by the taluka level union its registration would be cancelled as per the provisions of the Act. Such newly registered societies will have to get the bylaws approved from the competent authority. It was also clarified in the said policy that in one taluka there will not be more than one taluka level union and in a taluka where the taluka level union is registered its area of operation would be excluded from the area of operation of the district level union. In case, in all the talukas, within the area of operation of a district level union, separate taluka level unions are registered there would be no reason for the district level union to continue. Before a taluka level union would be registered. The primary societies at village level within the area of operation of such proposed taluka level unions will have to get affiliated to the proposed taluka level union.
8. The resolution dated 2nd February, 1990 is more of clarificatory in nature and it would be appropriate to reproduce the guidelines set out in paragraphs 9 and 10 of the said Resolutions.
9. In Writ Petition No. 5928 of 1999 the petitioner has brought to the attention of this Court that the Ahmednagar Zilha Sangh had passed a resolution on 23rd February, 1988 and decided to grant no objection for the registration of taluka level unions at the taluka within its area of operation. On 24th February, 1988 the petitioner was issued such a letter by the said sangh and the other petitioner claim that such letters were given to them as well. It appears that after giving these no objection certificates the said District level unions approached this Court in Writ Petition No. 4048 of 1989 praying for directions to the registering authorities not to register the taluka level societies in the area of its operation unless it was heard. By an order dated 8th March. 1990 the petition was allowed and the Registrar was directed to hear the petitioner Zilha Sangh while considering the applications for registration of taluka level unions. It is true that these developments were prior to the issuance of resolution dated 6th January, 1990. However, the fact remains that even in Ahmednagar district alone though there is another milk district by name Shrirampur. There are taluka level unions at Kopargaon and Sangamner etc. and they are functioning without affiliation to the Shrirampur Zilha Sangh. It is clear form the affidavit filed by the State Government in Writ Petition No. 843 of 1990 that when the impugned policy was announced there were about 42 taluka level unions operating all over the State of Maharashtra. The resolutions issued by the Government from time to time and as referred to here in above indicate that the Government of Maharashtra has recognised all along the existence of a taluka level union independent of a district level union and both of them are separately affiliated to the apex society at the State level and therefore, in the impugned policy dated 6th January, 1990 there is absolutely nothing that is sought to be introduced by the State Government in its existing policy for the development of Milk Co-operative Societies and its members.
10. After the impugned policy was announced a number of applications were filed for the registration of taluka level unions within the area of operation of the Ahmednagar Zilha Sangh and some applications were submitted even prior to the date of the said policy. In Writ Petition No. 843 of 1990 by an order dated 11th July, 1990 the operation and execution of the said resolutions dated 6th January, 1990 and 2nd February 1990 came to be stayed by this Court. Subsequent there to a number of petitions were moved before this Bench as well as the Principal Bench at Mumbai and interim orders in the nature of stay were passed. The applications submitted before the Registrar for registration of Taluka level unions were rejected solely on the basis of interim stay orders passed by this Court and some applications were kept pending. However, Writ Petition No. 843 of 1990 came to be dismissed as withdrawn pursuant to our order dated 29th February, 2000 and the interim stay order passed earlier stood vacated.
11. It is well settled that a Government policy cannot be a subject of judicial review by this Court under Article 226 of the Constitution unless it is shown to be (a) capricious or arbitrary, (b) against a statutory provision. (c) unconstitutional or (d) suffering from the vice of discrimination. This Court would not exercise its power of judicial review and interfere in the policy matters of the State unless the policy was formulated either violating the mandate of the Constitution or any statutory provision or is otherwise activated by mala fides. In the case of M.P. Oil Extraction and another v. State of M.P. and others, , Apex Court. While dealing with the powers of judicial review on the State policy, in a writ petition observed.
"The executive authority of the State must be held to be within its competence to frame a policy for the administration of the State. Unless the policy framed is absolutely capricious and, not being information by any reason whatsoever can be clearly held to be arbitrary and founded on mere ipse dixit of the executive functionaries hereby offending Article 14 of the Constitution or such policy offer other constitutional provisions or comes into conflict with any statutory provision, the Court cannot and should not outstep its limit and tinker with the policy decision of the executive functionary of the State. Policy decision is in the domain of the executive authority of the State and the Court should not embark on the uncharted ocean of public policy and should not question the efficacy or otherwise of such policy so long the same does not offend any provision of the statute or the Constitution of India. The supremacy of each of the three organs of the State i.e. legislature, executive and judiciary in their respective fields of operation needs to be emphasised. The power of judicial review of the executive and legislative action must be kept within the bounds of constitutional scheme so that there may not be any occasion to enterta in misgivings about the role of judiciary in outstepping its limit by unwarranted judicial activism. The democratic set-up to which the policy is so deeply committed cannot function properly unless each of the three organs appreciate the need for mutual respect and supremacy in their respective fields."
12. In Writ Petition No. 1147 of 1984 this courts attention was invited to the impugned policy and it was contended that it was illegal and unconstitutional. A Division Bench in its judgment dated 3rd April, 1992 observed.
"In our judgment it is not open to prevent the State Government from examining the application of respondent No. 6 on the basis that a certain policy does not permit creation of new society. It is for the Government and Government alone to decide whether an application should be granted in accordance with the existing policy or otherwise."
13. As observed herein above, in by the impugned policy dated 6th January, 1990 the State Government has not really embarked upon any new policy as such and it has demonstrated its determinations to follow the existing policy for the welfare of the milk producers by adopting the three-tier structure. The consistent policy of the Government reveals that its focal point is the village level milk producer and his welfare through the medium of co-operative movement. There is no deviation to the said policy in the impugned resolution dated 6th January, 1990. There is nothing to demonstrate that any of its terms are against any provisions of the Act or it is unconstitutional. By the clarificatory resolution dated 6th February, 1990 the Government has ensured to provide for built-in measures to safeguard the interests of the existing district level federal Unions and we may in this regard. Refer to the above quoted paragraphs 9 and 10 of the said resolution. It is clear from the said guidelines that if there are applications for registration of taluka level unions for the talukas in the area of operation of an existing district level union. The State will have to consider the issues of registration in totality by keeping in mind the interests of the existing societies, their members and then only take a decision whether the proposed societies should be registered or not. The applications submitted by such societies which would be within the area of operations of the existing district level union are not to be allowed automatically and it is contemplated that a detailed inquiry will be made by the Registrar including the feasibility of having more than one federal societies taking into consideration the prospects for milk supplies and the options available under sections 17 and 18 of the Act and he will have to wait for the Government's decision before the registration is granted to any of such applicants on assessing their own merits. The proposals as submitted for different talukas are required to be examined on the basis of their inter se merits and only one proposal can be finally accepted. Even while accepting the proposals on their own merits there are different stages for granting registration. The Government's powers for registration of new societies are clear as set out in section 4 of the Act. Section 6 provides for conditions for registration and section 8 sets out procedure for registration. If the Registrar is satisfied as per the scheme of section 9 of the Act, a registration certificate is issued under section 10 and that would be conclusive proof of the registration of a society. In the impugned circular the State Government has made it clear that no new proposal will be considered unless it is shown that it has the capacity of collection of more than 20,000 liters of milk per day and its performance will be observed for a period of two years. The target for increasing the collection during the period of these two years is fixed at a level of 40,000 litres per day and unless such a target is achieved. The registration will not be continued and it will be cancelled. On examination of the said policy read with the clarificatory resolution dated 6th February, 1990 we are High Court was of the considered view that it does not suffer from any vice of arbitrariness of unconstitutionality or being against any provision of the Act. The State Government has provided these safeguards notwithstanding the fact that the orders passed by the Registrar can be challenged by way of appeal/revision under the scheme of the Act.
14. However, the policy states that if taluka level unions are registered in all the talukas within the area of operation of an existing district level union the district level union would not remain and this is where the petitioner Ahmednagar Zilha Sangh is affected. It is true that if new taluka level unions are registered for the seven talukas within the area of operation of the said Sangh. Its existence would be in jeopardy. However, 1990 provides for built-in measures in paragraph Nos. 9 and 10 and it is evident that as the applications for registration of taluka level unions are required to be considered with care. Caution and after examining all the relevant aspects viz. The welfare of the existing district level union. Its members and also the welfare of the primary level societies and the milk producers as well as the potential for supply of milk to cater to the societies. The applications are not to be automatically processed and registrations are granted. Even if the Registrar is satisfied. On examining the applications or inter se merit, that a particular application is required to be allowed for registration of the proposed society for a taluka level, that itself is not the end of the matter. When the application relates to the taluka level union within the area of operation of the existing district level union the State is required to take a decision and communicate to the Registrar for proceeding further. It is therefore, evident that at every stage there are sufficient built-in measures to ensure that all the parties concerned are heard, they are allowed to present their case in support or otherwise, and if the Government is satisfied not to register a taluka level union at a particular taluka, the registration can be refused and there is no bar against such an action in the impugned policy. It is also common knowledge that in the scheme of the Act itself there is a remedy provided to challenge the order passed by the Registrar granting permission to open an account or start collection of milk or even the order of registration. The petitioner federal union at the district level is justified in voicing its apprehensions of facing an eminent closer and therefore, its case must be heard by the Registrar as well as the State Government before any decision for registration of any additional or new society at any of the seven taluka places is considered. Including the state of opening of a bank account or collection of milk.
15. For the reasons discussed in the foregoing paragraphs, we dismiss the writ petitions and direct the respondents-State Authorities, as under.
(i) All the applicants, who have submitted their applications for registration of a taluka level union at any of the seven talukas within the area of operation of the Ahmednagar Zilha Sangh be heard afresh for the purpose of granting permission to open a bank account as well as for collection of milk.
(ii) The Ahmednagar Zilha Sangh be allowed to submit its say at every stage, i.e. at the state of permission to open the bank account, to collect milk and at the stage of granting registration by the Registrar and the Sangh shall be heard at every stage.
(iii) The applications pending with the Registrar shall be heard and decided as expeditiously as possible and in any case within a period of two months from today. The Government of Maharashtra shall, in turn. After the Registrar has recorded his findings, take a policy decision as contemplated by the resolution dated 2nd February, 1990 within a period of two months thereafter and in the meanwhile status quo as on today shall continue. The State Government may also hear the financial institutions as well as the Unions of employees of the Zilha Sangh so as take a policy decision.
(iv) If any permission has been granted either to open a Bank account or for collection of milk after 23rd February, 1999 to any of the taluka level unions, the same shall stand quashed and set aside irrespective of pendency of the appeals or revisions before the competent forum against such an order and.
(v) An order passed by the Registrar, adverse to any of the parties, will not take effect for a period of fifteen days from the day such an order is communicated.
16. We make it clear that this order should not be treated as a direction to process the applications irrespective of inter se merits, at all the stages. We direct the Registry to place a copy of this order in all the connected pending writ petition before this Bench as well as the Principal Bench at Mumbai.
17. Rule discharged with no order as to costs.
18. At this stage, Shri Hon, learned Counsel appearing for the Ahmednagar Zilha Sangh prayed for certificate to appeal under Article 133 of the Constitution and to stay the above order for a period of four weeks. We are satisfied, for the reasons stated in our judgment, that no substantial question of law of general public importance is involved in this case. The oral application for certificate to appeal is hereby rejected. In the operative part of our order we have only given directions to decide all the applications after hearing the parties concerned and our order provides for enough safeguards to protect the interest of all the concerned. Hence, the prayer for stay is also rejected.