Gujarat High Court
Nilamben Mukeshbhai Patel vs Vashkui Dudh Utpadak Sahakari Mandali ... on 22 November, 2017
Author: R. Subhash Reddy
Bench: R.Subhash Reddy, Vipul M. Pancholi
C/LPA/204/2017 CAV ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
LETTERS PATENT APPEAL NO. 204 of 2017
In SPECIAL CIVIL APPLICATION NO. 16496 of 2016
With
CIVIL APPLICATION NO. 3409 of 2017
In
LETTERS PATENT APPEAL NO. 204 of 2017
With
CIVIL APPLICATION NO. 2859 of 2017
In
LETTERS PATENT APPEAL NO. 204 of 2017
With
CROSS OBJECTION NO. 7 of 2017
In
LETTERS PATENT APPEAL NO. 204 of 2017
With
CIVIL APPLICATION NO. 2434 of 2017
In
LETTERS PATENT APPEAL NO. 204 of 2017
With
LETTERS PATENT APPEAL NO. 216 of 2017
In
SPECIAL CIVIL APPLICATION NO. 16496 of 2016
With
CIVIL APPLICATION NO. 2545 of 2017
In
LETTERS PATENT APPEAL NO. 216 of 2017
With
CIVIL APPLICATION NO. 2858 of 2017
In
LETTERS PATENT APPEAL NO. 216 of 2017
With
CROSS OBJECTION NO. 6 of 2017
In
LETTERS PATENT APPEAL NO. 216 of 2017
With
CIVIL APPLICATION NO. 3263 of 2017
In
LETTERS PATENT APPEAL NO. 216 of 2017
With
CIVIL APPLICATION NO. 3182 of 2017
In
LETTERS PATENT APPEAL NO. 216 of 2017
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C/LPA/204/2017 CAV ORDER
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NILAMBEN MUKESHBHAI PATEL....Appellant(s) Versus VASHKUI DUDH UTPADAK SAHAKARI MANDALI LIMITED &
4....Respondent(s) ============================================================== Appearance in LPA 204 of 2017:
MR BAIJU JOSHI, ADVOCATE for the Appellant(s) No. 1 MR UTKARSH SHARMA, AGP for the Respondent No. 3 MR BS PATEL, ADVOCATE WITH MR CHIRAG B PATEL, CAVEATOR for the Respondent(s) No. 2 MR GM JOSHI, ADVOCATE for the Respondent(s) No. 1 , 4 NOTICE SERVED for the Respondent No. 5 Appearance in LPA 216 of 2017:
MS KRUTI M SHAH, ADVOCATE for the Appellant(s) No. 1 MR UTKARSH SHARMA, AGP for the Respondent No. 3 MR BS PATEL, ADVOCATE WITH MR CHIRAG B PATEL, CAVEATOR for the Respondent(s) No. 1 - 2 ========================================================= CORAM: HONOURABLE THE CHIEF JUSTICE MR. R.SUBHASH REDDY and HONOURABLE MR.JUSTICE VIPUL M. PANCHOLI Date :22/11/2017 CAV ORDER (PER : HONOURABLE MR.JUSTICE VIPUL M. PANCHOLI)
1. These appeals are filed under Clause 15 of the Letters Patent by the original respondent Nos.4 and 3, respectively, against the judgment dated 21.07.2017 rendered by the learned Single Judge in Special Civil Application No.16496 of 2016, by which, the learned Single Judge has allowed the petition filed by the present respondent Nos. 1 and 2 - original petitioners.
2. In both these appeals, the concerned appellant has challenged the judgment dated 27.1.2017 passed by the learned Single Judge and as the issue involved in both these appeals is Page 2 of 18 HC-NIC Page 2 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER common, with the consent of the learned advocates appearing for the parties, same are being heard together and being disposed of by this common order.
3. Brief facts leading to filing of the present appeals are as under:
3.1. It is the case of the original petitioners that petitioner No.1 is a cooperative society registered under the Gujarat Cooperative Societies Act, 1961 (hereinafter referred to as the Act) and petitioner No.2 is the Chairman of the petitioner No.1 Society and because of the order passed by the District Registrar appointing the custodian, petitioners have challenged the said order by filing the captioned petition. It is stated that the petitioner No.1 society appointed Election Officer, who declared the election programme on 02.09.2016 with regard to the election of the petitioner No.1 society. The nomination papers were received by the Election Officer. However, for 11 seats only 9 nomination papers were received and therefore 9 members were declared as elected on 12.09.2016 by the Returning Officer. However, on the same day, on the basis of the complaint given by the original respondent Nos. 3 and 4 - present appellants, the District Registrar, by his communication dated 12.09.2016, informed the petitioner No.1 that the election programme be cancelled and new election Page 3 of 18 HC-NIC Page 3 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER programme be declared as two seats are not reserved for women in the election of the petitioner No.1 society.
3.2. It is further stated that the Returning Officer informed the respondent No.1 by communication dated 22.09.2016 that the petitioner No.1 society will conduct the election for two seats of women candidates. However, in spite of such communication, by an impugned order dated 22.09.2016, the respondent District Registrar appointed the custodian for a period of two months while exercising powers under Section 74D(1)of the Act. Petitioners, therefore, filed the captioned petition and challenged the order dated 22.09.2016 passed by the respondent District Registrar.
3.3. The learned Single Judge, by the impugned judgment dated 27.01.2017, quashed and set aside the order dated 22.09.2016 passed by the respondent District Registrar, against which the original respondent Nos. 3 and 4 have filed the present appeals.
4. Heard learned advocate Mr. Baiju Joshi and learned advocate Ms. Kruti M. Shah for the appellants, learned advocate Mr. B.S Patel for respondent Nos. 1 and 2, learned Assistant Government Pleader Mr. Utkarsh Sharma for Page 4 of 18 HC-NIC Page 4 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER respondent No.3, learned advocate Mr. Gautam Joshi for respondent No.4 and learned advocate Mr. Hriday Buch appearing for the applicants in Civil Application No.3263 of 2017 which is filed for joining as party respondents in the appeals.
5. Learned advocate Mr. Baiju Joshi appearing for the original respondent No.4 - appellant has submitted that under Section 2(5) of the Act, definition of the term 'committee' is provided.
If the said definition is read with Section 74 of the Act, it would be clear that the management of every society shall vest in a committee constituted in accordance with the Act, Rules and Bye-laws. It is submitted that under the provisions of the Act the election of the committee of the cooperative society is to be held and the elected members of the managing committee and its office bearers can hold their office for a period of five years from the date of election. Thus, once the election of the committee is to be held, the committee means entire committee and no piecemeal election of the committee is contemplated or permissible under the law.
6. At this stage, learned advocate Mr. Joshi has placed reliance upon the provisions contained under Section 74(1B)(i) of the Act, which has been introduced with effect from 10.04.2015.
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C/LPA/204/2017 CAV ORDER
Relying upon the said provision, it is submitted that it is mandatory to keep two seats reserved for women in the managing committee of every society consisting of individual members. In the present case, the original petitioner market committee declared the election without keeping two seats reserved for women. When the appellants herein came to know that two seats for women are not reserved, they submitted an application. However, no action was taken. The appellants, therefore, informed the respondent District Registrar about the same. Accordingly, the respondent District Registrar by communication dated 12.09.2016, specifically informed the petitioner No.1 market committee that the election programme be cancelled and new programme be declared by keeping two seats reserved for women. However, the petitioner society declared the result of the election on 12.09.2016 though the date of publication of result was 16.09.2016.
7. Learned advocate Mr. Joshi would thereafter submit that the election held by the petitioner No.1 society cannot be said to be an election in the eye of law and it is nullity in the eye of law. Thus, it is not necessary for the present appellants to file proceedings under Section 96 of the Act before the Board of Nominees. The dispute cannot be termed as election dispute and therefore learned Single Judge has committed an Page 6 of 18 HC-NIC Page 6 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER error by observing that the appellants herein have alternative remedy of filing proceedings under Section 96 of the Act before the Board of Nominees.
8. Learned advocate Mr. Joshi thereafter contends that the respondent District Registrar has rightly exercised the powers under Section 74D(1) of the Act by appointing the custodian with a direction to hold the election within stipulated time limit. Thus, the learned Single Judge ought not to have quashed and set aside the order passed by the District Registrar. Learned advocate Mr. Joshi therefore urged that the order passed by the learned Single Judge be set aside by allowing these appeals. In support of the aforesaid submissions, learned advocate Mr. Joshi relied upon the decision rendered by the Hon'ble Supreme Court in the case of Babaji Kondaji Garad v. Nasik Merchants Co-operative Bank Ltd., reported in AIR 1984 SC 192 and decision rendered by the Division Bench of this Court in the case of Mohanbhai Jethabhai Pariya v. State of Gujarat, reported in 2011(5) GLR 4559.
8.1. Learned advocate Ms. Kruti M. Shah has also supported the submissions canvassed by learned advocate Mr. Joshi. However, in addition to the same, it is contended that the so-called election conducted by the original petitioner No.1 society Page 7 of 18 HC-NIC Page 7 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER is noting but a fraud upon the statute and therefore the same is void ab initio. When the election was conducted without keeping two seats reserved for women, such an election is nullity and therefore the respondent District Registrar has rightly exercised the powers under Section 74D(i) of the Act by appointing the custodian. It is therefore urged that the order passed by the learned Single Judge be set aside.
9. On the other hand, learned advocate Mr. B.S. Patel appearing for the original petitioner supported the reasonings recorded by the learned Single Judge and submitted that the term of the committee of the petitioner no.1 society was not over. However, in advance the petitioner No.1 decided to hold the election of the committee of the petitioner No.1 society and therefore an Election Officer was appointed and he declared the election programme. It is submitted that pursuant to the election declared by the Election Officer, 9 members are declared elected and therefore result was declared on 12.09.2016. On the very same day, the respondent District Registrar issued the communication which was received by the petitioner no.1 on 13.09.2016. Thus, before the communication was received from the office of the District Registrar, result was declared. However, out of 11 seats, 9 members were declared as elected. The Election Officer Page 8 of 18 HC-NIC Page 8 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER appointed by the petitioner No.1 informed the District Registrar by communication dated 22.09.2016 that remaining two seats will be considered as reserved seats for women and the election process will be conducted for the said two seats. It is submitted that though the said communication was received on 22.09.2016 by the office of District Registrar, on the very same day i.e. on 22.09.2016, the District Registrar passed an order while exercising powers under Section 74D(1) of the Act appointing the custodian.
10. At this stage, learned advocate Mr. Patel has referred the provisions contained in Section 74D of the Act and submitted that the case of the petitioners does not fall in any of the category prescribed in the said section. Thus, the learned Single Judge has rightly quashed and set aside the order passed by the District Registrar.
11. Learned advocate Mr. B. S. Patel would thereafter submit that without quashing and setting aside the election of 9 members who are declared elected, the District Registrar has appointed the custodian which is not permissible. It is submitted that power of the District Registrar is of administrative in nature and not the judicial power which the District Registrar is exercising while passing the order under Page 9 of 18 HC-NIC Page 9 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER Section 74D(1) of the Act. It is further submitted that the appellants herein are having alternative remedy of filing the proceedings under Section 96 of the Act before the Board of Nominees by raising an election dispute. However, in no circumstance, the District Registrar can exercise the powers under Section 74D of the Act. It is therefore urged that the appeals deserve to be dismissed.
12. Learned advocate Mr. Hriday Buch supported the contentions raised by learned advocate Mr. B. S. Patel and submitted that he has filed an application for joining party in the present proceedings on behalf of 7 members who are declared as elected in the election of the petitioner No.1 society. It is submitted that because of the order passed by the District Registrar appointing custodian, though petitioners are elected, they are not in position to function. It is submitted that till date the present appellants have not challenged the legality and validity of the election of petitioner No.1 conducted pursuant to the election programme declared on 02.09.2016 whereby only 9 members are declared as elected. If the appellants are of the opinion that the proceedings under Section 96 of the Act cannot be said to be an efficacious remedy available with the appellants, the appellants could have Page 10 of 18 HC-NIC Page 10 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER challenged the said election by filing petition under Article 226 of the Constitution of India before this Court. However, in the petition filed by the original petitioner society, the appellants herein have taken the contention that the election held by the petitioner No.1 society is not in accordance with law and is nullity in the eye of law. It is therefore submitted that till the election of petitioner No.1 conducted in pursuant to the election programme of 02.09.2016 is set aside, the District Registrar could not have exercised the powers under Section 74D of the Act. It is therefore urged that the present appeals be dismissed.
13. Learned AGP Mr. Sharma supported the order passed by the District Registrar by which the custodian is appointed for the petitioner No.1 society. Learned AGP has also referred the provisions contained in Section 74D of the Act and submitted that where for any reason whatsoever a new committee of management is not elected before the expiry of the term of office of members of a committee of management of the society, powers can be exercised by the District Registrar. It is submitted that in the present case, the term of the petitioner No.1 society was about to over and therefore the election was declared by the petitioner no.1 society by appointing the election officer. However, two Page 11 of 18 HC-NIC Page 11 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER seats were not reserved for women in spite of statutory provisions contained in the Act. When the present appellants pointed out to the District Registrar, he addressed a communication dated 12.09.2016 to the petitioner No.1 and instructed to cancel the election programme which was declared on 02.09.2016 and to hold the election after keeping two seats reserved within a period of 15 days. However, it was communicated to the District Registrar that 9 members are declared as elected on 12.09.2016 before the communication was received by the petitioner No.1 and for two seats nomination form was not submitted by anybody and therefore petitioner No.1 is agreeable for holding election for remaining two seats which will be kept reserve for womens. The said communication was sent on 22.09.2016. It is therefore submitted that the petitioner No.1 has partially acted upon the instructions issued by the respondent District Registrar. However, the entire election programme was not cancelled, there was no necessity for the District Registrar to wait for a period of 15 days as mentioned in the communication dated 12.09.2016. Learned AGP has therefore urged that the learned Single Judge has committed an error while quashing and setting aside the order passed by the District Registrar and therefore the appeals filed by the appellants - original Page 12 of 18 HC-NIC Page 12 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER respondent Nos. 3 and 4 be allowed.
14. Having heard learned advocates appearing for the parties and having gone through the material produced on record, it has emerged that for the election of petitioner No.1 society, election programme was declared on 02.09.2016 by the Election Officer. For 11 seats, 9 nomination papers were received and therefore all the 9 candidates were declared elected on 12.09.2016 by the Returning Officer. During the said election process the petitioner No.1 society has not kept two seats reserve for women candidates as per the provisions contained in Section 74(1B)(i) of the Act. The appellants informed the District Registrar about the same and therefore the District Registrar by communication dated 12.09.2016 informed the petitioner No.1 society to cancel the election programme and to declare a fresh election programme by keeping two seats reserve for women candidates. However, before the said communication reaches to the petitioner No.1 society, result was declared on 12.09.2016. However, thereafter the Election Officer of petitioner No.1 informed the District Registrar that remaining two seats will be considered as reserve seats for women and election process will be conducted for the two seats. However, the District Registrar, while exercising the powers under Section 74D(1) of the Act, appointed Page 13 of 18 HC-NIC Page 13 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER custodian in petitioner no.1 society. Section 74D(1) of the Act provides as under:
"74D.-Appointment of Custodian in certain circumstances.-(1) Where in respect of any society including a society existing immediately before the commencement of the Gujarat Co-operative Societies (Amendment) Act, 2015 (Guj.12 of 2015), a new committee of management is, for any reason whatsoever, not elected before the expiry of the term of office of members of a committee of management of such society or having been elected not functioning within a period of three months (not being a committee referred to in section 80A), except for the reason of order of the competent court due to which such election could not be held or the managing committee could not start functioning, the registrar shall by an order in writing, appoint a person or a committee of persons to be the Custodian of the society for a period of one year or until a new committee of management is elected or, as the case may be, starts functioning."
15. From the aforesaid provisions it is clear that powers under the said provision can be exercised by the District Registrar under two eventualities; firstly where a new committee of management is, for any reason whatsoever, not elected before the expiry of the term of office of members of a committee of management of such society and secondly the members of the committee though having been elected, not functioning within a period of three months. However, this ground would not apply where because of the order Page 14 of 18 HC-NIC Page 14 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER passed by the competent Court the election could not have been held or the managing committee could not start functioning. In the present case, as discussed hereinabove, it is not a case where the elections are not held nor there is a situation when the elected committee of the management did not start functioning within three months as stipulated in Section 74D(1) of the Act. From the aforesaid discussion, it is revealed that the District Registrar has passed the order of appointment of custodian on the ground that the elections of the managing committee were held in breach of certain provisions of the Act as the seats for women were not reserved.
16. At this stage it is required to be noted that the election of 9 members who are declared elected has not been set aside by any competent authority till date. The argument canvassed on behalf of the present appellant that the election held in pursuant to the election programme declared on 02.09.2016 is void ab initio and therefore District Registrar is empowered to pass an order of appointment of custodian, is misconceived. From the record, it is revealed that before the District Registrar informed the petitioner No. 1 society by his communication dated 12.09.2016 that fresh election programme be declared, 9 persons were declared elected on 12.09.2016 itself. If the appellants or any other aggrieved party are of the opinion that the Page 15 of 18 HC-NIC Page 15 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER election process conducted by the petitioner No.1 is not in accordance with law, such declaration is to be made by the competent authority/Court. Thus, the submission canvassed by learned advocate Mr. Joshi with regard to Section 2(5) of the Act read with Section 74 of the Act, is misconceived.
17. We are of the view that the election dispute cannot be said to have been covered under the provisions contained in Section 74D(1) of the Act. The District Registrar could not have exercised the powers for appointment of custodian to the society besides and beyond the grounds mentioned in the provision. It is well settled that when power is conferred on a statutory authority to be exercised on the grounds mentioned in the provision itself, acting to exercise powers on a different ground would tantamount to usurpation of powers. Thus, the District Registrar has acted beyond the powers conferred on him under the aforesaid provisions. As a result of the order passed by the District Registrar under Section 74D(1) of the Act appointing custodian in the petitioner No.1 society, indirectly the election of 9 members who are declared elected pursuant to the election programme declared on 02.09.2016 has been set aside.
18. The decisions upon which reliance is placed by the learned advocate Mr. Joshi for the Page 16 of 18 HC-NIC Page 16 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER appellant would not render any assistance to him in the facts and circumstances of the present case.
19. It is true that if any illegality or irregularity is committed in holding the election, the remedy may be to get the election set aside by resorting to appropriate proceedings. Learned Single Judge has observed that the remedy under Section 96 of the Act would be available with the original respondent nos. 3 and 4 - present appellants raising the election dispute. However, in the facts of the present case, when the main contention of the appellants is that the election process undertaken by the petitioner No.1 society in pursuant to the election programme declared on 02.09.2016 itself is void ab initio, we are of the view that remedy of challenging the election held pursuant to the election programme declared on 02.09.2016 by the election officer of the petitioner No.1 society, is available to the appellants by raising an election dispute under Section 96 of the Act or by filing appropriate proceedings before the appropriate forum/court by impleading the affected parties in accordance with law.
20. For the foregoing reasons, we see no reason to interfere with the impugned order passed by the learned Single Judge in the captioned petitions. However, it is clarified that it is open for the appellants herein to raise an Page 17 of 18 HC-NIC Page 17 of 18 Created On Thu Nov 23 03:30:31 IST 2017 C/LPA/204/2017 CAV ORDER election dispute by filing the proceedings under Section 96 of the Act before the learned Board of Nominees or by filing appropriate proceedings before the appropriate forum/court by impleading the affected parties in accordance with law. The appeals are, accordingly, partly allowed to the aforesaid extent only. Consequently, Civil Applications and cross objections do not survive for adjudication and stand disposed of.
(R. SUBHASH REDDY, CJ) (VIPUL M. PANCHOLI, J.) Jani Page 18 of 18 HC-NIC Page 18 of 18 Created On Thu Nov 23 03:30:31 IST 2017