Karnataka High Court
Sri Keshava Prasad S S/O Late ... vs The Registrar Of Co Operative Societies on 26 March, 2008
Author: H N Nagamohan Das
Bench: H N Nagamohan Das
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THE HONTJLF. IVITL TUSTICE I-LN
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. NAGAMOHA' N ms' 'A " ~ 5 .1'; 1- I *1 H
ETWEEN :
V1
7 BRuNnA#.r»;NA NAGAR,
Sri. C SHIVALINGAIAH. ;
SIOCHANNEGOWDA, " '
AGED ABOUT 57 YEARS," VV
NC).421,TRINE'l'RA 12.'1"HMAlI{,
S!£DAéSEflVANAGAR,..5
BANGALGPE.' ..
Sri. c%MT,BAsAv;r;1;A'1'.A' ._ " " V
AGED ABOU'f»3€)_YE .. % ~
No.16? 2ND cRos:S,~ R1vL_v.r:x1*E' '"'I'N,
JIJDICIAL OFFICERS LAYOUT,
SANJAYANAGAR, BANGALORE.
SHIv.A1~INA"N.. .....
. s.-'0 L.4.TE.3-;.A.1~IJ:\.LA.H,
' "AGED ABOUT. 63 YEARS,
-p'é.;zi'a:.":*:f0?n:;2:.a«*s:27, KRISHNA *1 H" "0 m
BANGALURE.5C!
sri." F.fiMPAIH11vmA1AH
A ' * 310 LATEKEMPANNA.
= ._AGED wow so mums,
NL11113 VENK.ATA_DR_I NLLA - A T
12TH MAIN, M.C.LAYOUT,
'v'L'AY;"».1\L'\GAR, BANGALOP\E=40.
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S11'. M RUDRAIAH
SIO NANJA_IA_I-L
AGED ABOUT 50 YEARS,
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JUDICIAL LAYOUT,
'I1 A1111 A' I'\I'i'I'I
DI
uVu1u.u1u:.-65.
Sti. T3 S SHANKARAMBA
W/O LA'I'E.H.L.PRABHAKAR_,
AGED ABOUT 53 YEARS, '
N0.2l0, IST C_.QSS§ I
B.D.A.LAYOUT, AVALAHALL
BA.NG.A.LQP.E-18.
(fA'I!LI'\A?
Sii. Bfionvruuu
S/O SANNAIAH.
AGED ABOUT 5'7 '
NCL24, 1ST MAIN, K.H.RA_N3A1'JAT'§HA' .
COLONY, JAGAJIVANRAM NAGAR._;' % V
BANGALORE-18.__
= ,,_. P3s1"1fno:«:ERs
(By Sri. T R SUBBANNA. A
M SIVAPP.-*'.,
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REP.BY rrs 'SECRETARY,
DEE'ARTMENTQF co~r_>:9.Ez2..A.1'1o1~I,
- _ M,'js;~BL;1Lm1qG, BANG-AIDRE-01.
A Raéwmwaa op CO-OPERATIVE
*---- ROAD,
BANGALORE-91.
.aDDrfioNAL REGISTRAR OF CO-0PERA'I'.lVE
ASOCIE'I'IES(I & M),ALI ASKAR ROAD,
3 BANGALORE-01. %
'W-n= nnmmsrpgroa Arm DEPUW. 1 REGISTRAR
«p...u..i a ua4v.s.uV
OF CO-OPERATIVE socmw,
'IA? 'I'l".'fl'f'rII"!.|'I'\ A-I AI firs;-I
I L 'm.' "CLE,wuu..:..nonw1mAM sun" Y
BUILDlNG,MAI..LESHWARAM,
BANGALORE.
1 . I\"J\__.
5 THE KARNATAKA STATE JUDICIAL
DEPARTMENT EMPLOYEES HOUSE
HUI.-DEG CQ~0PEF..A.TIVE L- .. A
NO.7!2,SURYA CHAMBERS,
-'i'IJT'\'fl"l'n"\f\'l') Ifl KIATLY
£.lV'J.J l.'1.4\..J\J.l.\, 10 J.'V.l£"\l..lV,
SESHADRIPURAM,
BANGALORE-'Z0.
(By Sri. S 2. A KHURESHL AGA)
ms wan" PETITION FILED UNBEE. ARTV;ICL'ESV':22O'::AND
337 OF 1'35 Cnxm'r'rrn'1'1nm nu 1-}'A1r=__-,11,.Og~ A W2.AVRR $9
\.IA'LJJJ}\JJ.«l\J1V,'.- 'I-ll 'III. L1 l.J\-".')_»I},q~.'
QUASH THE ORDER PAssI«:B--BY B1' AND R3 NAMELY
OROER PASSED BY" R1 1N &EEAL B1f.V131N.1a;2<:a7 B';:' Ew'EANS OF
AN ENDORSEMENT UNDER ANNEX-E DRIDER PASSED
BY THE R3 DT. 3.2. * £7 UN'T3ER'A1'€'N?.X'-C:'AN'I7.
BETWEEN: .... " W
1 s.-i. KESHAV
S/O LATE sE)DALINGAIF»H O
AGEO 42 YEARS,
KARNATAKA. RAJYA NYAYANOA
ILAKIIA
. . " . GRUHA NIPMANA SAHAKARA SANGHA LTD.,
V' "t~1>« '
* I-EIGI-I.COL'1II'vBU1I)LlNG, BANGALORE
. B :;;4.;, ROAD,
= 13-1' 'R'BL()CK;= RAJAJINAGAR
.-Z%ANGM.OPd'*'. 19.
Sri. 'R SRBENrv'AsA
V, 'A 310 LATE V RAJU
= _ . AGED 53 YEARS, DIRECTOR,
1. RAJYA NYAYANGA
ILAKHA NOUKARARA -
'-- ORUHA NIRMANA SAHAKARA SANGHA LTD.,
HIGH COURT BUIDLING, BANGALORE
BJA1: No.1-Et, .h.rLA..TN AvA.I...A_I-1.A.LL1
EXTENSION, BSK III STAGE, BANGALORE 85.
N"
\..,/
Sri. M B SEENA
SIG LATE BOREGOWDA
AGED 52 YEARS, DIRECTOR,
i~'u'\I'iz'\N'i'I'u"'{A '£€I"u":'x': N':';";'I':"\NG-u";
ILAKHA NOUKARARA
GRUTH NTRMANA SANGHA LT".,
HIGH COURT BUIDLING, BANGALORE
R/AT NO.860, 7TH MAIN, 7TH CROSS,
JUDICIAL LAYOUT, GKVK posr
BANGALORE s. ¢
sRI KUMBINARASIMI-IAIAH
SIG SANIEE'v'AIA.'-I V
AGED 53 YEARS, DlREC'I'OR,*_ * Lk
m"x'A N'x'A'mN~3A I
ILAKHA NOUKARARA I
GRUHA NIRMANA SA1-L%KARA"SA.'sTGHAL"T'D.,
HIGH COURT BI_JIDLIN'G, BANGQLQRE' » I. M
R/AT NO.145l, 37"' 'C'CR03S, " .
4"' "I'.e.I.Qc_:I;, JA_Y_A_NAGAI_{_ I " =
BANGALORE' 41, '
IRHRETTIIONERS
nm REG-1s'IRAR oFR'caiE:rI§fiRAnvE SOCIETIES
INVI<._ARNAT.AKA,.H.O.=,
IsI9.I, AI.-I ASK-AR ROAD,
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I TIIE 'A1§DrII§)IIAL REGISTRAR OF co-OPERAIIVE
(INDL. Am Is/IIsc.,) I-1.0.,
No. ASKAR ROAD,
BAI"JGALORE 52.
~ " SECRETARY
V' KARNATAKA RAJY A NYAYANGA ILLAKHA
('.l.'D'I'Tl'.'l'A 'KTTDIIANIA An A
IS'-I HI'! 'D36 I
V' \'l'f\'l"I'I:"A'D AD A
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SANGHA LTD., HIGH COURT BUILDING,
BANGALORE 1.
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4 TI.-IE DEPUTY REGISTRAR OF CD-QPERAIIVE %
SOCEITIES-2 AND
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'VI-I-JVLK-"I\.l."I.I\.F.I\' IV-I-J' \-Ill. Iv,
DISTRICT -1 MALLESHWARAM,
BANGALORE. .
RESPC) L
(By Sri. SZAKHURESHI, AGA) '
THIS wnrr PETITION FILED UNDER 226*
227 CF 111.5 coNs'r'r'rr....rrIoN op INI)IA A PR1'-.~YER
QUASI-I TI-IE ORADER VIDE ANN-c,~DT,_s.s.oim PASSED"BfY.4I1fIVEV§
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1 Sri.I(SIPPEGOWDA % %
szo LATE Cm1<K"MAV!£.l.2_E€'1n:5\.7£'l_7A - x
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AGED 55 YE:iRS,5DIBEC'IQR,-V.,
"WV *"'£AT.*--';KA .Pu@.".'.é;'1-1'§';¢.V m:*.--.a.
5555;'
n.AKHA%%LNoLr:<AI:A% ' "
GRUHA SANGHA LTD.,
H1GH* _coUR'I EBNAGLAORE
1210 NC: 76,1*''"*' (1 VcRoss,% rr? STAGE,
4" BLOC2& BASAVES1-IWARANAGAR
BANGALOR-E." , ~
' Sii§§"M%iLAYY:¥ * %%%%% W ~
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' ~ .s/0 LATE P.i%.NCH.A.YYA
A AGED-57 YEARS,
. z=;;o«m.;2«-s7H; max
' QUARTERS, 12"' A MAIN,
BIJDCK-"RAJAJ'1'NAGA'R,
BANGALORE 10
A. " srm V'..~V}"SI-IIVAKUMAR
"S_/QPLATE G s SIDDALINGAIAH
AGEL! 59 YEAJN,
1 _
F KARNATAKA RAIYA NYAYANGA ILAKI-IA
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VKIUJW "cl-I.\I.V&I I11' I I-7'
SANGHA LTD., HIGH COURT BUILDING
I'IA\ffIAI' I'\.l'A'l'l'I'& fi"'l"
1:sANUAJ..0RE RIO NO.1\'.'v65, 0' i n' J.V.lfl.l.1V,.3 DIG,
BASAVESHWARANAGAR, BANGALORE 79.
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2/
4 Sri. P SRINIVAS
S10 LATE .A.PP.A_T.A.H
AGED 53 YEARS,
nin un [no rrvu\.ru1.1'
Nu 1VU.0uo, Ln wxnuw,
SIRNIDHI NILAYA, JUDICIAL LAYOUT,
"" "K POST, BANGALORE 62.
1 PEm10Ni3;;s"'C _
-----_ --
.- . PA_._.L. VIFPATIL, ADV!) V --
AND:
INKARNATAKA,'H.0.,:" % _
NO.1,AHASKA3£;ROAD,
~ *
1 mm REGISTRAR OF co S'Of§lfi}1?}E~S
(1NDL._- AND H-0-".~ _ '
ALI
BANGALORE 52'.-~ ' *
2 THE AnDrrioi&rA%;%;12;$3c41s1f:1iA1a¢j1iVc§)-OPERATIVE
3 SECRETARY'
- RAJ¥.A..NYAYANGA ILLAKHA
' « .Ni3I,TK;.A;P..A_'i~'.«A GRU!-LA NI.R_M.A_NA SAJ-I_A_K_A_RA
% SANGHA Len). I-IIGI-I coum" BUILDING,
1:a..4.1(1., K'! nut'; .1
J-)1 M1 .5 I-I'a'.'v~J'I\-I,-J IL,-.'
4 THE;':'s§,i=iJ'::YfiGisTRAR F - mm ma
L socnnms-2 AND
A ADMiNIS'I'RATOR, BANGALORE
. ' DI$TRICT-1 MALLESHWARAM,
* 'VBANGALORE.
RESPONDENTS
1/ *1 L a ' f F % X % .. (I:iy Sri. s z A KHUREBHI, AGA)
/N»
(Bysri. JAYAKUMAR S.PA'I'IL. Sr. COUNSEL A
FJ? 9- L % %
T!-JITQ trtpw m3'r'rnnkr F'lT_F'.1) UNT) .1! A ggg AND
I-ll-I-'DJ I \«lJ -I-I-(Asa-1'50:-1 .n.a.n..u.a -91 ....- -- ..---.._-.-- ..-_._
227 OF THE CONSTITUTIO O INDITX WITH A PRAYER TO
1'15 'l"'I"l" D
QUr'\SHTHE. ORDER VEE :"iNi'~u:.A.C. lJ.l.. 8.3.2097
p p AND ETC.
These Writ Petitions having been hearcl and reserved.«fcrf A'
this clay, NAGAMOI-IAN DAS J ., pronounced 'the foliowing; _ ., j
ORDER
in The Karnataka State Judicial Emp1oy7ejes..,_VVIjIoi£1seVi Building Co-operative Society Liniitedi-"" sf" respondent neieiii is a co-operative society (for short ----*.$ecietr') Kamataka Co» operetive Societies Act, 1959 (for.sh_m.t is managed by YCETB. Of! 2:71 Clfifi Itpiii 36 um Gfiilul .1466 x management of anti 15°t'ii_'1'octorsti1at is the petitioners in these three writ petitions wsreelccted of five years. On 14.06.2007 the 3" respondent issuetia slioureause notice under Section 30(1) of the V' 'Act l6A.chat1ies"'*a;iidV to show cause as to why committee of society shall not be superceded. The second respondent itiipusned order in the appeal before him summarises the charges as C " -. Failure to follow the instructions issued under Section 68 based on audit report of 2004-05 (Charge 1) B. Charges pertaining to stafiing pattern and payment of bonus (Charge 5 and 14) ,,L/v» (/ W D. Loss to the Society (Charge No.13) Irregularities in land purchase and develoyznnent. 0- allotment (Charge No.8. 9. 10. and 12) H " " 57' F. Failure to observe certain' No.'l5:j V :7. A . 7-I:
G. General charge about__'seyeral' iizregtilaritiieia > newspapers and media alleged before Hon'ble Higli = "I"I... 3 nnnf;
,, Q :3 .2 :
4. _ :1»-~-vte-I its :-~-» 3*" 13.912 contending thatV.the_'ie;iiaroea baseless and requested to drop further tiroeeedistfig. eliarges the society also produced number of doeurnents. A 3*!'_reepondent by considering reply submitted by the .soeietytupassod.an oraeeoo 03.03.2007 superceding the committee pof of xthe""so'eiety and appointed the 4"' respondent as to"tlie"t{ociety. Aggrieved by this order of supersession some other or the society i.e. the petitioners in W.P.No.2008l/2007 ix__fi.!-d before the Secretary to Government in Appeal/CMW IOLA. '2....? Secuor 1.... ..ft. e As. The Secretary t- ,._vet'n. .e-nt 'wdfi "iC'tOfi6i'|'1e"i'|t dated 3} 10 290? dismissed tire awe e... ..o. 'maintainabie on the wound that the Registrar of Co-operative Societies is the appellate authority and not the Government. Some of the Directors KJ , ___4 ____ .; .._ _ .- ..
ueIe_nse.= . '£116 "respondent ough ID has e can Registrar of Co-operative Societies vide order dated 29.1 some jdilsresfissjesif' - the appeal and sustained the order of supersessionr' H it "
petition questioning the order of supersession appellate authority dated 29.11v.'200.7x V endorseinent * 31.10.2007 and for other reliefs.
3. Sri T.a.s.mu;g, for some of the petitioners contend: the it supersession dated 08.08.2007 3":'l:_V:e_sponclentl..'vie' oppoed to the principles of natural aslterppstdarnitting their objections and doeuznents, '3?" 'respondent to give a personal hearing and the respondent in the impugned order of .g_s as on theigound that produee..__otlte-neoessary documents and ought to have' provided an oral ' " - lie contends that the hearing includes oral hearing. Therefore. he
-,,eont_'ends that the impugned order is opposed to principles of natural justice and liable to be quashed. 'u---k)|I\l\_ \./' cl for some of the F-
lfl 23 7 <9 I B 3 5H 5- II 3 I I 3 3 5 2 5 EB frivoious and unfounded. He contends that in respect of some"._ charges the respondents initiated enquiry proceedings underfiectioii h' "' ' ' the Act much earlier to the show cause respect of some of the charges a public i1tte1fest[_litifiation is W.P.No.40994/2002. He contends tiiatewhen2titei1itattersi'es*ev«~vpenrli11st before this Court and the authorities. the_4_i:irt-pugnued supersession as bad in law.
5. Sn' Jeyaicirnar counsel for some of the petitioners contend olziservation made by the court in Advocate wrote a letter on 20.03.20tl'?._ to: action against the society for super sesion.' applying their mind and without enquiring i..t.. the s.lieg.a..2....s and ....l;-,r on the basis vf at .ette-r .3,' "a_responsi'bie for the charges specified in show cause notice. For the A lapses committed by the previous managing committee. the respondents ML/ox 11 have uperceded the present managing committee and as such the same is bad in law. He funher contends that if the members of the met-iious managing committee committed certain irreuularities. then the ~ V. _ shall proceed to take action againstthem either under Sectiottfiéfi T K Section 64 or under Section 69 of the Act anclriot to st_Ipereedefttie_ newly elected managing committee of the 'Reliance
i) AIR 1971 sc1eé3'ee~.e Umon of India V.J)'oti' A. :h
ii) AIR 195730 1393 " e State of V'; Grautaati 1\r1onicipal.I:T'-card, Gauhati A1-*R_ 19'i5.hst:--§95"'ee?o'1reeV e V __ V_fIfhe'~£}ove:rgrrte1ate_of V. J.V.Bhat fil .
I...
\
iv) 1_976(2;'Ka;;L.J.I23"»..__ e ' 'v"fiewa:aathiah V. J-=-t of Cjo-operative"Soeieti--es and others. v3' ~ to 197§(2).tKar;L.i;cso#i% " E V' C.V$.MohantV_.._State ofKarm1tnkn r Xvi) t':998(2)eKar.L.J.24s nanrni and H1311 .. ...,,....._, ...... ............. A,..:.'\ _gr'"n- nn v.....nan1 _ ll) . 7:v1\.iu 1.371 Asif Alan' Sait V. Union of India ' t * r ILR zooo Kat 2841 T M.Srinivasa Reddy and others Vs. Registrar of Co-operative Societies for Karnataka \u/ 1988(2) K.tt_nLiJ. 214 Selvan M. and another V. Vivek Finance Cotpn. & ear. I -
I X) AIR 1959 SC 308 Guiiapaiii Iv'-ageswara and others 'v'. z'\.P.S.R Pr! LC.
'\
xi) 2008 AIR SCW 540 Reserve Bank of India V. M.Hnnumaiah & ors.
xii) AIR 1981 SC 818 Swadefii otter. Mills 'J. Unis:-. of .r...ia 1981 (1)Kar.L..i. 443 JagdishPatilV. State ofKmno.takit'**«. ¢
7. Per contra. Sri s.z.A.K1me_snL teariied AG:t;'ie'a;:.;;j;eitsi§;h¢"rt V impugned order of gupersession and of 'eptfiieiiiote He contends that Section 30(1);::f5f._fl1e ootepecify or personal hearing. After issuing show statement of objections and filed the 3" respondent passed the . end the same is in accordance 4~_-_.:.___ .,-.;- -..;a- ',. "L.-g ...'....... .. ..... ..- ......... Luruwn La IE1: Iuo mat iuluac l.l.l'1--}.'I¢»l_t "It fiwuvnw '13:": 'sh? Gfiflfihsvxut finding of the 'authorities ~7the Act. Reiiancc is pieced on the " f9H°Vf"i3 ';1°--§iei93ls: " A _____ .. c
g) 12.7 ' ' N:cvt;lgttaid T uka Agri Produce Co-op Marketing Society
- . W... Azmtgeri 5: Gas V. State of }{a-.r:-.a*.......=-'==- 8:. one.
ii)" 1 1976(1) Kar.L..i'. 536 The Bhadra Ryots Co-operative Society Ltd Vs. State of Mysore and another.
iii) 1983(2) Kar.L.J. 313 Veerazmagowda V. Dy.Regr.Cooy.Societies, Mandya {LR 198? K33' 1335 Appa Snheb R.Kerakalumatti V.Addl.R.C.S. .. .
<5 \I|J r\}w\+ \._/ 13
8. Heard arguments on both the side and perused the entire nu-if n , 'VIII! yup?' I'! 'III 'C __!..A __..i.. JII - '. 1.. -- .4 4.1.4.... .ei_ e--n n_-n_u_ ..-__ ... ,. __ ,__. .. ;: . H16 031', H13 I011 WIIIE I3 W111 'l!lU I. 1' my Uuilulltlfil" ll I;
(i) Whether this Court under Article 226 otttte¢..tte..tt¢g u it A 2 41 India can interfere with the" of:
(ii) 'v'v'itet'ner the im.pumed.t':utder_*zSection' of"'e ' 't is bad in law for tttttiatiof éttei marina'?
(iii) Wi1ether.._ usupersesaion is in Section 30(1) of the eeee V_ opfv-tire'-.esseiitial features of the democratic republic ' __ estéhiished under the Constitution is division of powers between the iiof-the State: The Parliament and State Legistatttre. The Executive Judiciary. These three wings are expected to operate in
-theirxrespectitre earmarked fields so that the democratic Government both V. tltt'ttte and the states may function for the welfare of the people. Our
-..e}f..-.i--. -.-at-d the Sexerne Court the High Courts as ""tstit'ti'ti"n"' Court" 't'titi't extereive mteere ofjttchciel review m enforce constitutionai rights and ftmdamentai an' aim to safe" "Ci oth"
observed:
"Lf 1 was asked to name any Article Constitution as the most impfirtanls " it this Constitution would be a nul1ity,«.__V I eouldnot refer tioatgy Q': other Article except this one. It'e».ié'i»the verysou!-I offtlte consfitution and the very heart of it taridfittni 'g1ae'_ '_ ' that thofiouse I I I "
"as realised its impt.-rwce. « ~ u- -'par-' Saoha ( ti 1 , _i37f:_i'1ei_c"t'th"at mic.-ta 226, however in practice, isle. power conscience. to be a friend in need when the pummonecomco in'; criéi lion: a victim of iniustice: and more 3 '' ithis Aextroordiiiary reserve is unsheathed to grant final relief neceésetryjrecourse to a remand. What the Tribunal may. in its diucretion Court too can, under Article 226, if facts compel to 'odo so. , it * The Supreme Court of India in the case of The Controller and _A1__1%litor General of India Vs. K.S. Jaganathan. AIR 1987 SC 537, held:
"'2'. "here is thus no doubt that the liigh Courts in '*3... evemising .he-ir jurisdtet-..,_.. 1.;-..n...er Article 226 !-Awe thepowertoissue awritofmandamusorawritinthe nature of mandamus or to pass orders and give necessary directi-'rte where me or a public has to exercise or has wrongly exercised the discretion conferred upon it by a statute or a rule or a policy decision... j of of the Government or has exercised such discretion ruaia C "
fide or on irrelevant considerations or ..by__igt1o_rin§ "the . reievant considerations and materiais oi:_in sucizja C as A mtstrate the ebject cf cmfening sucitéi-;ere*.ion ~ '~
-policy for implementing which has conferred. In all such cases and in fit V} case a High Court can, vintlte .,jurisdictiion"
under Article 226, issue a in the l ' '- """'"~ '"is tn nature of or pass" cm,-tel the a ;_.2nd'-l.;w!iIl mm- the discretion or a public prevent injustice
resulting to. conce1ned«patties,_ the Court may itself pass an five the Government or the public if '"' passed or given tau-" it E .
and nanny exercised it discretion."
.. ii; in the law laid down by the Apex Court in the
-cisiens the fact sl-.1ati--- L. the i_n_-tant case is to be system. The purpose of judicial review is to ensme mat an is given fair treatment by the authority to whom he has 'been i V V ' . _ if subjected to. Under Section 30(1) of the Act the Registrar is empowered to supersede the committee of management of a cooperative society which d\s/\/\~ 16 persistently makes default or is negligent in the performance of the duties of the Act. Ifthe originai order passed under Section 36(1) of§tite'fi'tetjot . the order passed by the Appellate Authority uoqe;eeetioe."1coiLor.thoI Act _: "
are found to be against the object and spirit ofsupersestiion .o.feu scci"ety :1 T A' where it is found that the authority exceedett in it 'A error of law apparent on the face of or are perverse in relation to the is always subject to judiciel review. to substitute L cpi_n_ior1 for the --7w1:il.e5rlecidi11g the matter. IU IIIJVV VI FIN.
__.-£'....
interfere with theortiers poised authorities tinder the Act. III 1 e 1 hold that this con, under more' 226 of the Constitution. can interfere 'with or the iiutherities passed under Section 30(1) of the Act V.V'a1td.:ttte'ordcr:1)assvec:fb_v the Appellate Authority under Section 106 of the " to-..«;-.-,i.», efier givlttg the committee m opportunity to sue Ls Act.' No} ~§sVA'enswered in afiirmative.
_..... .. .. ah.
____ A_._i -..
any. (WI if] 1 uuvc Ill. §":€'I u Iuufifi, fiuu a-pyuuu cur 1 adminitrator to manage the affairs of the society for such period. The Court in the case of Reserve Bank of India Vs. M. Hanun1aiiih,:_l__ 2008 AIR SCW 540 while interpreting section 30 of the Act held ,,
-case of removal of the committee of it--cooperative society, it with the principles of natural justice is expressly subsection (1) of Section 30 it is stipulated the'.-liepistrai' _urould, the order of only an to state its objectioue." % me c...er ..al'.€'. t,te---segesi.-eiuent cf';:i::--?..hee.l..g is .. L-.1. '.'.., absent in subsection (5) which _af:-ni}m- usteunw ei :-
2!.
Anna. J use 1-
-4 I-
covers the pmvisions o:f'_the,_eariier'suti-eeietioii. of the Act. In Charm:.I.ai-.:.$ahu:: iiicliaii sc 1480 it is held that all 'be heard as part of due process of leer whereeiiestions their right. privileges or claims are eonsiderecl or i it "
Iigsiaie. of new 'V5. dauhati Municipality, AIR 1967 so 1393 it 5'_islilie1cVl'V'tliat as {irate afierwconsidering the explanation of the Board to in: personal heiuing not specifically shew eeu e notice and uiithout gen '_ at _>Iii"A_Govetnment of Mysoie Vs. IV. Bhat, Am 1975 so 5'6 it is the nature of hearing would, of course. varyeccoiiling to the V iiatuee of the function and what its just and fair exercise required in the context of rights aifected.
,Lt1\J\ A Diviion Bench of this Court in the case of Navaiaund Taluka Agri Produce Co-op. Marketing Society Ltd., Annigeti and others State ofKarnataka and others, 1973 (1) KLJ 127 held. that ., of the Act requires an opportunity to be given to the eigeinst which action is proposed to be taken to statejiteiiohj-ections..; ifjzmy, Ami':
--r'__ Ill 'till than an': A'? nailing' illafineg '_*W"y'_g'_-l' "e -fei V' * -. _ .
in Vecranna Gowda vs'. "Ad 'def Cooperative Societies, Mandya, 193.3(2) K131" 3'13}: .;j.j¢1.;1 ' of hearing under secgac.~{~3o neg not be oral hearing in
14. Keeping in mine: down by the co-art -~a this Court the Vdeeisicns_:efe1r_ed above it is required to examm' e the "scope of 39(1) of"fl:e..Aet. In my considered opinion the following .1Vmineit1lee.wil!,4emerg§: --- .
" . .(i)V V 'ty to state objections in Section 30(1) of the Act an opportunity of hearing to the aggrieved party. " '(ii)' The word 'hearing' in the context of Section 30 of the Act do not include oral hearing or pentonal hearing. (E The Con-.tn~2..ee ..f - .._.agetne.-It or the _ -t' the n.......:u 4.' I. ,....-......g. ' \.au.|I|.uuufifi e. tne ew,.......t'.ve mt", .. e ...... A. .. ..,... l..._.....
are not entitied for orai or persona': mm 3. h
- I\
6._\[\.J'*"
to state its objections in is cmnjiiianee ' 19 ~ 'fit-I'! Nature oi -earh1g would vary from case to case in the .,__., - ..
(v) If the aut'r:on'ty We doubt or ambiguity, may call upon the ~ management to clarify the same..
QIU I I-ll I IUII1 I iluvivvunnun-u V -r -V-W--RI th' Si'1"W' c.'"*e "rrce h-'ve 'rt "e"zl":t fr: any oral hearing ':={'1+.4.r;..t.+~'-. the petitioners contend that they._oraily..*retioeeted= third-respondent to provide a personal hearing respondent. There is no other that the Petitioners had made a request__ fiiigerwise asa matter of right the 5;-an¢; clg:;§1ea'e or personal hearing. The third respondent the reply did not entertain any doubt or arnbiguityirvhich neede 'Therefore the impugned order passed ndent would not be vitiated for want of personal hearing. .i16JCo--operation is as old as human civilisation. In the primitive
-,.commnne system, man developed the concept of co-operation of each ' __aceording to his ability and each according to his need. The evolution of family. community and ultimately international feeling pring out of the desire of men and women to co-operate with one another to overcome V. '_ ti1ev_ititi11sii'iai Revoiution__wiiich took piaee in Engiand dating scene 20 individual weakness. What is known as co-operative eifort is ultimately I-Inn new-sun. incl-Zuni in than us in Anaheim I-uv puny uuuuun. -
together and heir: eae* *th' principles of -eo-operation have been practiced from time . spirit of village communities of India wasialmost entirely ..§o¢&perativo. '4 The villages have throughout the ages 'ini'orrnel_i co-operative basis. The co-operative' cl_e_1nentin"tl1e of v India was represented by joint family The sessions. scripture Rigvedastatesz it p it I it 2 V you all have} 1, 1- pp V
1.. iviayyon. all be._th_e'same. V _ . So il1atyou"ean.dov't'~*o1fIt'efiiciently well"
1"? .9 the mo..-are teehngeal seine. the ,,en.esZs of co-operative ....... _.....L 4. A 6.. gang}; I-Ina nnntnnnvli an tum Ililfl » half of the nineteenth century. Co-operation as is Aliesayisgsiiim economic system was born as a peaceful reaction against the mercantile economy and Industrial Revolution which had i it resulted concentration of wealth, mass poverty and degradation. In India l rnodein co-operative movement had started in the early part of
-»v-twentieth century. Since then, it has grown in stature and extent of covering more than 90% of the villages and covering nearly 40% of rural I._;x.
21 1.21.'.-:.\I..l:-.ti-... The cc-cpermive -._tiviti,s acquired a predominant position in
18. Number of persons join together, invest themselves into a co-operative society. But, it i not possible round _ « embers to attend the day-to-day ofithe acct-onerstive_ the s...n.r-.ir-.is..:-..L.... ..f the s-.-ietyiis enh'I_1s-ed't-3. s"-,_w ele'c*tedV administration of the societysirt accortianc-e--wii;h_ iaw end-c'ns"'t rn 'f the society. The representatives .jVinsna:gfei_the seciety not for their own selfish motives. for the 'henefiti~of:sli the members. in the Act ass rnea.surecheci§'over i.i'lil.i'aiiifi'l.'i'!"':'i'1ii'I§'; management as a -who'1_e,._ilits. members and employees of the society. Section _ 29(c)(8) of . the iActV'ernpowers the Remstrar of Co-operative " " _ Socicties_'to remove Vorte---disqualify fiom holding any ofiice for a period not 5 yems, any member of the committee of the Co-operative Society f_ acted fraudulently or with gross negligence or ',_ contravenes provisions of the Act and the Rules. Under Section 63 of it ~ Act, it audit of the Co-operative Societies is made compulsory. The eceepceratdve audit is ....t ....1y a fi.n=_Incisl audit but also encompasses 22 ........s,.-.. A 4' ' ' ' ' ' ' -
w mus; arm :.ii""":'6ic'il condition ef e eeeeepceremve society. -9.-ect1.,._._ 68 _f
-"er the Act empowers the Registrar to pass orders dire'-t'"r; the 7"Gif"ii_'ist"« remedy the defects disclosed in the audit under Section-630? . enquiry under Section 64 of the Act. Section 69 _ef"tl1e.::iAct"'snecifies initiation of surcharge proceedings for recoveryéaf from the committee of managemen_t=9r itsxcfliee otherii v members.
20. Yet another impor_:_ta.'1t priwisioneeassesirneasme of check over the committee of afsoeiety 7is~,itsi supersession under Section 30 of 't;he" For' the this. the relevant provision is Section i3fl(Al)' ;;Act and as under:
L « «~39. mysepersessisneer Committee : (1) in the Reg€.s'irer;.¥ _ _(_s_''; A. committee of a co-operative. society A persistently makes default or is negligent in the
---performance of the duties imposed on it by this ..V"V"Aot or the rules or the bye-laws or commits any act which is prejudiciai to the interest of the society or Itu Ina:-nltnra nr ht nfhfirfll-iflfl II 1' INF" 'Hi II 155 IIIUIIIUVJB, V1 15:! Univ': vvluur' anvv GVIIlI»w'rnI-ion-nun properly; or fly) a co-operative society is not functioning in accordance with the provisions of this Act, the .. _I'..--.s.£ -
rules or bye-iaws or any order or eireeuun issue- by the State C=o\.rern_n.1ent or the «_ Registrarvis fully satisfie__c_'t__«tZtat the 'f iii' comm: t" *1' III 23 R.-.sr,i_-J ('_.ciud' g the direction issued under section 3013) the Registrarmay, ..... ..
21. The p-wers ---.ferre¢.i Section 30(1) of it committee of management of the society is there must. V default in the performance of its duties thetiirec 'ens orvirantings by the Government or the vi:14c;ristra_t'i'i"f:_ ._soc'iety ptttttttuott making default in discharge of its dutiesi atett ettiyit be said that the society has persistently the of directions or Warnings is lie-gistrar should resort before rI._hi_n.g supei°se--asion. As far as possible the
-we: ef"sep«ses.eiott~.'sh,.L..., '.'.-.._-_ e;=:._.-...is.er.l nniv as a last measure. The power of supie"-xessiort shouid "era: merir.g.":t' and only t-.'..en he 'r!tttIiz4lfiVei11§tttpiI!,:1§0Wer is prejudicial to the interest of the society as a The frequent use of this power and its exercise
-- V are iiRely"-todefeat the very object and spirit of co-operative movement. If H 'A the power of supsersession is freely exercised.- then the duly elected it i 'comrnittee of management and its members will be in perpetual fear of axe supersession. Therefore strict compliance of the requirement under
-.ec.l--- 30(1) -ftl1e Act is a must to remove the duly elected committee of 22 K.eepi.-g _.- s.ru..d Lite Meet .,_d _,__t _f Se-t1-__ 30(1) 0. the Act, 't is r-"aired te exams:-.e the feet situation in me ieste-'* "- ffifi the Show cause notice 14.0032 7 as as 16 ievelied against the society. The 3"' respondent in the 0- sesion dated 00.03.2007 dropped chemo No.2,?-_._ 4. 3 aid' is 'auz1d"held..tl1e " 2 0 remaining charges as proved. In appeal, dated 29.11.2007 held charge No.9.'10,_ 11 "medi'12V the remamm' ' it charges as not proved. - of ' stlpersession dated 08.08.2007 is merged .0 ,of_s1ii5e!lste authority dated 29.11.2007. Therefore the 9_to.".1_VV2 eharge required to 2 L-ee-...i.,.-ed. -- .. - _ s the ptspose~.oft .13 esse.__ "
23. No.9...t210%i'iene...12.eeenems to irregularities in pmchaseioflsnd. .;eeeee1ee.eeg;; and enounem of sites. Admittedly these charges relstestor the 0005. The committee of management Vteleested on 24.02.2005. The committee of "iifii'1jr' ' 1I'uuuuy'u1 previous the supersession of the present committee of ' is bad in law.
24 F-.L1!:er1. is no..e-d .!1.e ---00:- ..... he zemclenm vid- urum is 05.06 2%? "-utiated -fires:-'3 preeeedirr-s eader S-"tie-a 54 ef the Act in respect of the charges pertaining -to 9. 10 and '2 '"'en the 25 enquiry oroceedings under Section 64 were pending against the society 1' l___d, it development and allotment of sites, the I - ' same c tut ue l.l.Ifl-UV e e cht-.t'ge ..y the respondents m the t,.v~.:!'_.!£!!.-t-. Government Advocate that the proceedings Vinitiated against: it under Section 64 of the Act are concluded by; t 29.11.2007 by the Additional Regjsttt.-ty of tiootierative' jtntts further suggested to take action under ofthe hand the respondents have taken the on the other hand under Section 30(1)_of in respect of the same chas.';'ges;j.;tgI.1his act on the titerespondents is opposed once. ssfegustd avaiiabie to a citizen against the State under Article 2.99;. 0f:the'f§0r1stitution of India. on this ground the
- of is liable to be quashed.
U9; '.
"It tenet in dispute that t..e issue rel:-...ng t.. .eurc!1...se ..f iand,"-its deveioptnent and 'iio'"'ent 'f sit" ts else the fiubjfi" matter 1!': at ' -- "public interest litigation in W.P.No.40992/2002 pending on the iiie of this it Tiiicourt. the matter is ceaed of by this court in a public interest htigation the same cannot be made as a charge for supersession of the committee of management of society. Further the respondents without appreciating the documentary evidence produced by the committee of k/754*"
26
-..._fl..g-!!!E_tl1L, in support of their defense in respect of charge no.9. 10 and respondent is contrary to me evidence on rwrd. The altered. '='-h.'-;'v"i't:'.et-.~~..9, 10 and 12 will not amount to persistent default by the society. 1 _ the impugned order of supersession is liable; quashed; --- .1: 'g ,
26. Charge No.11 specifies the reyiaed Its.ld%S per ; Sq.Ft to the developer by the society ar1alysisVV:ot":cost;escalation. Again this charge relates "to._"the 2005. it 'l'he previous committee of the management oftlte the payment to the escalation is cost_airuiiy"is. 11] - pell*'t" '"'tltoi'ity it'. the impugned-- order 'noticed fact-that in a project spannm' 3 over several years, cost escalations Further the appellate authority noticed V' _ only fours-'uirectors in the present committee who were in the committee are responsible for the decision to escalate Therefore', the supersession of the present managing committee for the committed by the previous managing committee is bad in
27. The reasoning of the Appellate Authority that some of the elected members of the present committee of management were also members in the previous committee of management and they are (7t\c'\_/K. 'Ll tiefatiit on't'tte..,part'VV'of the society is absent in the instant c 27 responsible for the charges levelled in the show cause notice and therefore present committee of management is to be superseeded is bad in law. If some of the members of the committee of management are tesponsible"fer default or negligent in performance of the duties imposed A' the Rules, then the Registrar is empowered to proceed uA_ us': ganvvavwm' 69 of the Act. Meter, "t "T are":.f'i:f"ibi' '---for'wVthe_: eiiar es - of menafiern"
continuing in the present committee of shall not beta 'ground for supersession of the presentof of the society.
Further it is on record to prove and estal:g:isi'i'is.1_eer;sistent'Vti1e part of the society and its to show what are the directimtszor Govemment or Registrar which are disobeyed or,__violate'c!_ by the present committee of _ 1'.' B6. 1' IIIUBG _ reasons the "t.'-nfittmted order of supersession and the 0 tier of Appeiiate ' -- liable to be quashed.
G%"'R
i) "Writ petitions are hereby aiioweci.
\/\/\-' U t or under Section efillmof .A_et or _Section I II_ An: n'I'-'pl-Iiisg. n'w:,111'niI-tr V ;1) 111 in! [II ulwvl U1. uayvxuvuuififi passed the 3'" repcndeiif zinc': fine Gffifif _ri$_ted 29.11.2007 passed by the 2*" respondent ---- a;'sp§fI1g§e.,u authority are hereby quashed.
The 4"' re,-:9:-...-:21! -- 2.1....-=.1.1:-.:i.s..=.-.t..z* 'ia ;...e.y.d.i-1:er;*_ed. t- hi-mu aver the charge f' m~ u"fiIi':'1i""fi fmi' ca 1 m g 'I --sd[_'_.
DKB/LRSV. ~~~~