Madras High Court
S.Arumugam vs M.S.Padmanabhan
Bench: M.Jaichandren, M.M.Sundresh
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 30-2013 CORAM THE HONOURABLE MR.JUSTICE M.JAICHANDREN AND THE HONOURABLE MR.JUSTICE M.M.SUNDRESH O.S.A.No.408 of 2012 and O.S.A.Nos.126 to 129 of 2013 O.S.A.No.408 of 2012 S.Arumugam .. Appellant. Versus 1. M.S.Padmanabhan 2. R.Vijay Raghavan 3. M.R.G.Appa Rao 4. V.S.Vikram 5. R.Madhavan 6. Srinivasan Balakrishnan 7. Arvind Ramarathnam 8. Ishwar Achanta 9. SBS Raman 10. R.L.Nerula 11. Madras Gymkhana Club, a registered Society under the Societies Registration Act, 1860, and now deemed to be registered under the Tamil Nadu Societies Registration Act, 1975, Rep. By its Honorary Secretary, The Islad, Anna Salai, Chennai-600 002. 12. P.V.S.Venkatasubramaniam 13. SBP.Anand Mohan 14. S.T.Gouthaman 15. V.Murali 16. A.P.Suresh Kumar 17. C.Venugopal .. Respondents. Prayer in O.S.A.No.408 of 2012: Original Side Appeal filed under Order XXXVI Rule 1 of Original Side Rules read with Clause 15 of Letters Patent, against the order, dated 21.9.2012, made in Review Application No.3978 of 2012, in C.S.No.754 of 2010. For Appellant : Mr.P.S.Raman, Senior Advocate for G.Krishna Kumar For Respondents : Mr.S.Parthasarathy, Senior Advocate for M/s.D.Prabhu Mukunt and Mr.Arun Kumar (R1 to R6) Mr.P.S.Raman, Senior Advocate for Mr.Lakshmi Ratan (R8) Mr.AR.L.Sundaresan, Senior Advocate for Mr.V.P.Raman (R7, 10 to 14, 16 and 17) No Appearance (R9 and R15) O.S.A.No.126 of 2013 Madras Gymkhana Club, a registered Society under the Societies Registration Act, 1860, and now deemed to be registered under the Tamil Nadu Societies Registration Act, 1975, Rep. By its Honorary Secretary, The Islad, Anna Salai, Chennai-600 002. .. Appellant. Versus 1. M.S.Padmanabhan 2. Vijay Raghavan 3. M.R.G.Appa Rao 4. V.S.Vikram 5. R.Madhavan 6. Srinivasan Balakrishnan 7. Arvind Ramarathnam 8. P.V.S.Venkatasubramaniam 9. Ishwar Achanta 10.S.B.P.Anand Mohan 11.S.Arumugam 12.S.T.Gouthaman 13.V.Murali 14.R.L.Nerula 15.S.B.S.Raman 16.A.P.Suresh Kumar .. Respondents. Prayer in O.S.A.No.126 of 2013: Original Side Appeal filed under Order XXXVI Rule 1 of Original Side Rules read with Clause 15 of Letters Patent, against the order, dated 27.7.2012, passed in Application No.98 of 2012 in A.No.4545 of 2012 in O.A.No.931 of 2010, in C.S.No.754 of 2010. For Appellant : Mr.AR.L.Sundaresan, Senior Advocate for Mr.V.P.Raman For Respondents : Mr.S.Parthasarathy, Senior Advocate for M/s.D.Prabhu Mukunt and Mr.Arun Kumar (R1 to R6) O.S.A.No.127 of 2013 Madras Gymkhana Club, a registered Society under the Societies Registration Act, 1860, and now deemed to be registered under the Tamil Nadu Societies Registration Act, 1975, Rep. By its Honorary Secretary, The Islad, Anna Salai, Chennai-600 002. .. Appellant. Versus 1. M.S.Padmanabhan 2. Vijay Raghavan 3. M.R.G.Appa Rao 4. V.S.Vikram 5. R.Madhavan 6. Srinivasan Balakrishnan 7. Arvind Ramarathnam 8. Ishwar Achanta 9. S.B.S.Raman 10.R.L.Nerula 11.P.V.S.Venkatasubramaniam 12.S.B.P.Anand Mohan 13.S.Arumugam 14.S.T.Gouthaman 15.V.Murali 16.A.P.Suresh Kumar 17.C.Venugopal .. Respondents. Prayer in O.S.A.No.127 of 2013: Original Side Appeal filed under Order XXXVI Rule 1 of Original Side Rules read with Clause 15 of Letters Patent, against the order in Review Application No.3978 of 2012, in C.S.No.754 of 2010, dated 21.9.2012. For Appellant : Mr.AR.L.Sundaresan, Senior Advocate for Mr.V.P.Raman For Respondents : Mr.S.Parthasarathy, Senior Advocate for M/s.D.Prabhu Mukunt and Mr.Arun Kumar (R1 to R6) O.S.A.No.128 of 2013 Ishwar Achanta .. Appellant. Versus 1. M.S.Padmanabhan 2. Vijay Raghavan 3. M.R.G.Appa Rao 4. V.S.Vikram 5. R.Madhavan 6. Srinivasan Balakrishnan 7. Madras Gymkhana Club, a registered Society under the Societies Registration Act, 1860, and now deemed to be registered under the Tamil Nadu Societies Registration Act, 1975, Rep. By its Honorary Secretary, The Islad, Anna Salai, Chennai-600 002. 8. Arvind Ramarathnam 9. P.V.S.Venkatasubramaniam 10.S.B.P.Anand Mohan 11.S.Arumugam 12.S.T.Gouthaman 13.V.Murali 14.R.L.Nerula 15.S.B.S.Raman 16.A.P.Suresh Kumar 17.C.Venugopal .. Respondents. Prayer in O.S.A.No.128 of 2013: Original Side Appeal filed under Order XXXVI Rule 1 of Original Side Rules read with Clause 15 of Letters Patent, against the order, dated 27.7.2012, made in Application No.98 of 2012, in A.No.4545 of 2012, in O.A.No.931 of 2010, in C.S.No.754 of 2010. For Appellant : Mr.P.S.Raman, Senior Advocate for Mr.Lakshmi Ratan For Respondents : Mr.S.Parthasarathy, Senior Advocate for M/s.D.Prabhu Mukunt and Mr.Arun Kumar (R1 to R6) O.S.A.No.129 of 2013 Ishwar Achanta .. Appellant. Versus 1. Madras Gymkhana Club, a registered Society under the Societies Registration Act, 1860, and now deemed to be registered under the Tamil Nadu Societies Registration Act, 1975, Rep. By its Honorary Secretary, The Islad, Anna Salai, Chennai-600 002. 2. P.V.S.Venkatasubramaniam 3. S.B.P.Anand Mohan 4. S.Arumugam 5. S.T.Gouthaman 6. V.Murali 7. A.P.Suresh Kumar 8. C.Venugopal 9. M.S.Padmanabhan 10.Vijay Raghavan 11.M.R.G.Appa Rao 12.V.S.Vikram 13.R.M.Madhavan 14.Srinivasan Balakrishnan 15.Arvind Ramarathnam 16.S.B.S.Raman 17.R.L.Nerula .. Respondents. Prayer in O.S.A.No.129 of 2013: Original Side Appeal filed under Order XXXVI Rule 1 of Original Side Rules read with Clause 15 of Letters Patent, against the order, dated 21.9.2012, made in Review Application No.3978 of 2012, in C.S.No.754 of 2010. For Appellant : Mr.P.S.Raman, Senior Advocate for Mr.Lakshmi Ratan For Respondents : Mr.S.Parthasarathy, Senior Advocate for M/s.D.Prabhu Mukunt and Mr.Arun Kumar (R1 to R6) COMMON JUDGMENT
(Judgment of the Court was made by M.Jaichandren,J.) The Original Side Appeal, in O.S.A.No.408 of 2012, had been filed against the order of the learned single Judge of this Court, dated 21.9.2012, made in Review Application No.3978 of 2012, in C.S.No.754 of 2010.
2. The Original Side Appeal, in O.S.A.No.126 of 2013, has been filed against the order passed by the learned single Judge of this Court, dated 27.7.2012, made in Application No.98 of 2012, in A.No.4545 of 2011, in O.A.No.931 of 2010, in C.S.No.754 of 2010.
3. The Original Side Appeal, in O.S.A.No.127 of 2013, has been filed against the order of the learned single Judge of this Court, dated 21.9.2012, made in Review Application No.3978 of 2012, in C.S.No.754 of 2010.
4. The Original Side Appeal, in O.S.A.No.128 of 2013, has been filed against the order of the learned single Judge of this Court, dated 27.7.2012, made in Application No.98 of 2012, in A.No.4545 of 2011, in O.A.No.931 of 2010, in C.S.No.754 of 2010.
5. The Original Side Appeal, in O.S.A.No.129 of 2013, has been filed against the order of the learned single Judge of this Court, dated 21.9.2012, made in Review Application No.3978 of 2012, in C.S.No.754 of 2010.
6. The Civil Suit, in C.S.No.754 of 2010, had been filed praying for a judgment and decree declaring that the decisions taken by the office bearers and the General Committee of the first defendant Madras Gymkhana Club, from 1.10.2008 till the date of the filing of the suit, including the annual accounts submitted in the general meeting, dated 18.9.2009, and the resolutions passed in the Extraordinary General Body Meeting, dated 20.3.2009, as null and void, as they are ultra vires the rules and the bye-laws of the Madras Gymkhana Club. The plaintiffs had also prayed for the appointment of a High Powered Committee to enquire into the affairs of the first defendant Club, in respect of the allegations made in the plaint filed in the civil suit, for the period commencing from 1.10.2008 till the date of the filing of the suit, and for a permanent injunction restraining the defendants, their men or agents from conducting election or passing accounts till the court appointed Committee furnishes its report and until consequential actions had been initiated.
7. Original Applications, in O.A.Nos.931 and 932 of 2010, and applications in A.Nos.4705, 4706 and 5093 of 2010 had been filed in the civil suit, in C.S.No.754 of 2010.
8. The original application, in O.A.No.931 of 2010, had been filed praying for an order of ad-interim injunction restraining the first respondent Club, its men or agents and others claiming through it from passing the account, for the period ending 31.3.2010, in the Annual General Meeting, scheduled to be held on 17.9.2010, or on any other subsequent date, pending disposal of the civil suit.
9. The Original Application, in O.A.No.932 of 2010, had been filed praying for an order of ad-interim injunction restraining the first respondent Club, its men or agents and others claiming through it from conducting election to the post of office bearers and the General Committee, for the period 2010-2011, or for the subsequent periods, till the disposal of the said suit.
10. The application, in A.No.4705 of 2010, had been filed praying that this Court may be pleased to appoint an Advocate Commissioner to take possession of all records, including the payments made by the members of the first respondent Club, for the bills relating to the period 1.10.2008 till the date of the filing of the civil suit, and the other records relating to the renovation works, functions, carnivals and training camps conducted by the first respondent club during the said period.
11. The application, in A.No.4706 of 2010, had been filed praying that this court may be pleased to appoint an Adhoc Committee, consisting of senior members of the first respondent Club, to administer the club and its affairs pending disposal of the civil suit.
12. When the applications came up for hearing on 15.9.2010, it had been informed to the Court that the Committee of the first respondent Club had passed a resolution, dated 1.9.2010, constituting a committee of eminent jurists to go into the various allegations and complaints and the controversies that had arisen in the administration of the first respondent Club. A panel of eminent members had also been appointed to assist the jurists.
13. On taking into account the resolution passed on 1.9.2010, and in view of the allegations and counter allegations made by the members of the first respondent Club, the learned single judge of this Court had passed an order, on 15.9.2010, permitting the General Body Meeting to go on, as scheduled, on 17.9.2010. The learned single Judge had permitted the Committee constituted by the first respondent Club to investigate and to submit a detailed report before the Court, after affording an opportunity of personal hearing to the plaintiffs in the civil suit to ventilate their grievances. Thereafter, the Investigation Committee had been reconstituted, with certain changes. The Investigation Committee had held a serious of meetings and on completion of the enquiry it had submitted a report in the month of April, 2010. Based on the report submitted by the Investigation Committee the learned counsels appearing on behalf of the parties concerned had made their submissions.
14. Mr.G.Rajagopalan, the learned Senior counsel appearing on behalf of the plaintiffs in the civil suit had submitted before the learned single Judge that it was essential to appoint an independent auditor to verify the accounts of the Club, in view of the findings of the Investigation Committee. He had also submitted that an Adhoc Committee may be appointed to replace the existing committee of office bearers, to enable the auditor appointed by the Court to have access to all the relevant records and to carry out the audit, independently.
15. Mr.Abudu Kumar Rajarathinam, the learned counsel appearing on behalf of the Club had submitted that none of the findings recorded by the Investigation Committee had implicated the office bearers, in respect of the alleged financial impropriety, said to have been committed by the office bearers of the Committee and therefore, there was no necessity for the appointment of an Ad hoc Committee. However, he had submitted that the Club was not opposed to the appointment of an independent auditor, by the court.
16. Mr.R.Yashod Vardhan, the learned Senior counsel appearing on behalf of the 5th defendant had submitted that there was no necessity for the appointment of an Ad hoc Committee to replace the existing Committee of office bearers and there was no necessity to appoint an independent auditor to scrutinse the accounts, as the Club had a reputed firm of charted accountants, as its statutory auditors.
17. Taking into consideration the observations and the findings made by the Investigation Committee in its report submitted before the court, the learned single Judge had observed that no strong case had been made out for the replacement of the Elected Committee, by an Adhoc Committee. However, he had found it fit to appoint an independent auditor to scrutinise the accounts of the Club and to submit a report to the court. The learned single Judge had taken note of the conclusion recorded by the Investigation Committee in paragraph No.58 of its report.
18. The original application, in O.A.No.5093 of 2010, had been dismissed, as the third defendant in the suit had died. O.A.No.932 of 2010, seeking an order of ad-interim injunction, restraining the first defendant Club from conducting the election, for the period 2010-2011, had been dismissed, as it had become infructuous.
19. The application, in A.No.4705 of 2010, seeking the appointment of an Advocate Commissioner, to take possession of all the records, had been disposed of with the direction to the 1st defendant Club to collect all the relevant records and to keep them in safe custody, for being handed over to the independent auditor appointed by the court.
20. The application, in A.No.4706 of 2010, seeking the appointment of an Ad hoc Committee to conduct the affairs of the Club, pending the disposal of the suit, had been dismissed.
21. Keeping the original application, in O.A.No.931 of 2010, pending, the learned single Judge had passed an order appointing M/s.Guru and Ram, Chartered Accountants, to scrutinse the accounts of the 1st defendant Club from the financial year 2008-2009 and to file a report before the Court, within the time limit specified in the said order.
22. Pursuant to the order passed by the learned single Judge, dated 27.6.2011, the first defendant Club had filed an application, in A.No.4545 of 2011, in O.A.No.931 of 2010, in C.S.No.754 of 2010, seeking certain clarifications relating to the order, dated 27.6.2011.
23. The learned single Judge in his order, dated 29.9.2011, had noted that the first defendant Club had filed the application, in A.No.4545 of 2011, seeking certain clarifications, in respect of three issues, namely, (1) Whether the statutory auditor appointed by the Club could audit the accounts for the year 2010-2011, (2) Whether the Club can conduct the Annual General Meeting, as per Rule XV of the Bye-laws and (3) Whether the present General Committee can continue in office beyond the 30th of September, till the elections were conducted.
24. The learned single Judge had noted that the auditors appointed by the court had completed a major portion of the work relating to the auditing of the accounts of the first defendant Club, for the years 2008-2009 and 2009-2010. The auditors had sought time to furnish a draft report to all the parties concerned, on or before 15.10.2011, calling for their views and to finalise the report, by the 5th of November, 2011.
25. The learned single Judge had issued certain directions, in his order, dated 29.9.2011. The said directions are as follows.
"(i) The Auditors appointed by the order dated 7.6.2011 shall continue the audit of the accounts for the year 2010-2011 also, despite the fact that the power for appointment of statutory auditor vests with the General Body Members. This is in view of the fact that there should be continuity before the Auditors appointed by this Court
(ii) The Auditors are requested to go ahead with the finalisation of the accounts relating to the years 2008-2009 and 2009-2010 as per their proposal and finalise the report by 5th November, 2011, de hors the above direction requesting them to continue for the year 2010-2011 also.
(iii) After the report for 2008-2009 and 2009-2010 are finalised, the present Committee shall issue a notice convening the AGM for the conduct of the elections. Till the elections are held, the present Committee shall continue in office both for passing accounts in respect of the pending years and for conduct of elections as per Rule XV. Till the elections are over, the present Committee shall continue.
(iv) If before the actual date of elections and the AGM, the accounts for 2010-2011 also happen to get finalised, it may be included as one of the Agenda even if the circulation of the same would fall short of the period of notice required by the bye-laws."
26. After the learned single Judge had issued the directions, by his order, dated 29.9.2011, an application, in A.No.98 of 2012, had been filed by the applicants, who were the plaintiffs in the civil suit, in C.S.No.754 of 2010. In the said application it had been stated that the defendants in the suit had misled the auditors, in respect of the various aspects, including the income tax liability of the Club and that they had committed serious financial irregularities, and that the Committee members had squandered the money of the Club, by embarking on illegal projects.
27. It had been further stated that the members of the committee, in general, and the office bearers, in particular (defendants 2, 4 and 5), had colluded, conspired and breached the trust vested in them, with the malicious intention of defrauding the Club of huge amounts of money and therefore, a good case had been made out for the supercession of the Committee and for taking appropriate legal action against the members of the Committee, who were directly involved in the irregular acts, under Section 34A of the Tamilnadu Societies Registration Act, 1975.
28. It had also been pointed out that, in similar circumstances, a civil suit, in C.S.No.1187 of 1992, had been filed before this Court and a senior member of the Club had been appointed to manage the affairs of the Club till the formation of the committee. and to suggest certain changes to the rules and the bye-laws of the Club, to ensure that serious irregularities did not take place, in future. In such circumstances, the applicants had prayed for certain clarifications, with regard to the following aspects:
i. Can the present committee which is allowed to continue, in the above circumstance continue to manage the affairs of the club.
ii. Can the defendants, contest the election for any post, to manage affairs of the club, till the disposal of this suit in the above circumstances.
iii. In the absence of the present committee, who has to administrator, the affairs of the club?"
29. A counter affidavit had been filed on behalf of the Club, in A.No.98 of 2012, denying the averments and the allegations made by the applicants therein.
30. The learned single Judge of this Court had passed an order, dated 27.7.2012, in the application, in A.No.98 of 2012, with the following directions.
"(i) Mr.M.V.Raghunathan, the past President of the club is appointed as the Election officer to conduct the elections of office bearers to the first defendant-Club, after following the process laid down in the rules. He shall start the exercise within a week of receipt of a copy of this order, issue notification, invite nominations, finalise the electoral rolls and conduct the election and complete the process within a period of 3 months from the date of receipt of a copy of this order.
(ii) The existing office bearers are at liberty to contest for any posts subject to the decision to be taken by the general body on the action to be taken on the audit report. But, they shall not interfere in the election process. They shall also not take any major decision till a newly elected set of office bearers are appointed.
(iii) The Election officer, shall notify the members of the general body about the auditors report and circulate the executive summary (only the executive summary and not all 3 volumes) of the report along with the notice convening the general meeting. The notice shall indicate that the views of the general body would be sought on the action to be taken on the findings of the audit report. The notice shall also indicate that if someone wished to peruse all the 3 volumes of the audit report, they would be free to inspect and take notes, during fixed timings. At the General Meeting convened for the purpose of electing office bearers, the Election officer shall allow a free discussion on the audit report and seek the decision of the general body on the action to be taken in pursuance of the audit report. If the general body resolves to initiate any disciplinary action against one or more office bearers, they shall be disqualified from being elected despite their nominations having been accepted. After this agenda is finished, the Election Officer shall take up the agenda relating to elections.
(iv) The staff of the first defendant-Club shall render all assistance to the Election Officer.
(v) The Election Officer shall file a report into court after the meeting."
31. The respondents in the application, in A.No.98 of 2012, had filed a review application, in Review Application No.3978 of 2012, against the order, dated 27.7.2012, made in the application, in A.No.98 of 2012.
32. The review application had been filed on various grounds. It had been submitted that the prayer in the application, in A.No.98 of 2012, was limited to the extent of clarifying as to whether the present committee of the Club can continue to manage the affairs of the Club, in the light of the audit report. It had also been stated that the direction given by the learned single Judge, in paragraph 24(ii), of his order, dated 27.7.2012, with regard to the appointment of an independent person, as an Election Officer, to conduct the election, goes beyond the scope of the prayer and the contentions raised on behalf of the parties concerned, in the application, in A.No.98 of 2012. The name of Hon'ble Mr.Justice K.P.Sivasubramaniam (Retired) had been suggested, on behalf of the Club, for the purpose of executing the order passed by the learned single Judge of this Court, effectively, especially, for the conducting of the Annual General Meeting. Various reasons had been given on behalf of the Club for making such a proposal.
33. It had been further stated that, as per the directions issued by the learned single Judge, if the general body of the Club decides to initiate an enquiry against the office bearers of the Club, they would stand disqualified from being elected, in spite of their nominations being accepted. Such a course of action was not contemplated or warranted in the light of the prayer made in the application, in A.No.98 of 2012. It had also been submitted that the audit report, which had been submitted, would be discussed in the Annual General Meeting, before the general body of the members of the Club. As such, the directions issued by the learned single Judge, which is under review, is contrary to the Rules and Bye-laws of the Club.
34. It had been further stated that Rule XXI(2)(ii) of the Rules and Bye-laws of the Club provides that a member of the Club would be debarred from contesting the election to the posts of the office bearers of the Club, if any disciplinary enquiry had been initiated against the member concerned, sixty days prior to the notification of the election. However, the directions issued by the learned single Judge, in paragraph No.24(iii) of the order, dated 27.7.2012, is to the effect that any person against whom the general body of the Club decides to initiate action, he would stand debarred from contesting the election. Such a view of the learned single Judge is contrary to the Rules and the Bye-laws of the Club. Further, the directions issued by the learned single Judge, for conducting the election, separately, after the general body had taken up the report of the auditors for consideration, would pose practical difficulties.
35. The learned single Judge had issued directions appointing the Election Officer to conduct the election, to the post of the officer bearers of the Club, by following the process laid down in the rules, within a period of three months from the date of receipt of a copy of this order. It had been clarified, in the said order, that the existing office bearers were at liberty to contest for any of the posts, subject to the decision to be taken by the general body and the action to be taken, based on the audit report. It had also been clarified that the existing office bearers should not interfere with the election process and that they should not take any major decision till a newly elected set of office bearers had been appointed. It had also been pointed out that the Election Officer should notify the members of the general body about the auditors report and to submit the executive summary of the report, along with the notice convening the general meeting. It had also been noted that the notice shall indicate that the views of the general body would be sought with regard to the action to be taken on the findings of the audit report. The notice shall also indicate that it would be open tot he members to inspect all the three volumes of the audit report, and to take notes, during the fixed timings.
36. It had been further pointed out that, in the general meeting convened for the purpose of electing the office bearers, the Election Officer should allow a free discussion on the audit report and to seek the decision of the general body on the action to be taken, pursuant to the findings incorporated in the audit report. It had also been stated that if the general body resolves to initiate any disciplinary action against one or more of the office bearers, they would stand disqualified for being elected as an office bearer of the Club, despite the fact that their nominations had been accepted. The learned single Judge had also directed that, after the process relating to the said agenda had been completed, the Election Officer should take up the agenda relating to the election.
37. The learned counsel appearing on behalf of the review applicants had submitted that the directions issued by the learned single Judge, in his order, dated 27.7.2012, were unworkable and that they were contrary to the Rules and the Bye-laws of the Club. The office bearers and the members of the Committee cannot be disqualified by following the directions issued by the learned single Judge of this Court. The grounds for disqualification are found in Rule XXI(2) of the Rules and Bye-laws of the Club. The method proposed by the learned single Judge, in his order, dated 27.7.2012, for voting in the general meeting, with regard to the disqualification of the office bearers and the members of the Committee, by way of discussions and by voting based on the report of the auditors, are contrary to the Rules and the Bye-laws of the club. A mere decision taken in the Annual General Meeting to initiate an enquiry against the office bearers and the members of the Committee cannot disqualify them from contesting the election.
38. The learned counsel appearing on behalf of the review applicants had pointed out that, in Paragraph 24 (iii) of the order, dated 27.7.2012, the learned single Judge had directed the executive summary of the audit report to be circulated to the members, along with the notice to convene the Annual General Meeting. The executive summary prepared by the auditor portrays a grossly incorrect picture of the affairs of the club. In fact, on a perusal of the findings, in Pages 51 to 53 of Volume-I of the audit report it is clear that the General Committee had nothing to do with the alleged misappropriation relating to cash coupons.
39. From the audit report it is clear that one of the employees of the Club had been found to be involved in the alleged misappropriation relating to cash coupons. However, if the executive summary alone is distributed amongst the members of the club, without giving them an opportunity to analyse the entire audit report, it would create a serious prejudice in the minds of the members of the Club when the issue relating to the disqualification of the office bearers and the committee members of the Club are taken up for discussion during the Annual General Meeting.
40. It had been further submitted that the order of the learned single Judge prohibiting the present committee of the Club from taking major decisions, till the newly elected set of office bearers are appointed, is ambiguous in nature. The order of the learned single Judge prohibiting the present committee from taking decisions on a number of issues, including the issue relating to the revision of wages of the employees and the staff of the Club would result in serious prejudice being caused in the administration of the Club. Therefore, it had been prayed that the order of the learned single Judge, dated 27.7.2012, may be reviewed and appropriate orders be passed.
41. The learned single Judge, by his order, dated 21.9.2012, made in the Review Application, in Review Application No.3978 of 2012, having considered the rival contentions raised on behalf of the parties concerned, had ordered as follows:
"That the order dated 27/07/2012 need not be treated as a precedent.
2. That the counsel for the plaintiffs shall carry out necessary amendments in the plaint striking out the names of the first plaintiff and the third defendant from the array of parties.
3. That this court refused to review the order dated 27/07/2012, prohibiting the present committee from taking any major decisions, and not only clarify that the Committee is at liberty to take such of those decisions which are required for the smooth functioning of the Club and carrying on the routine day-to-day activities of the Club.
4. That the request to replace Mr.M.V.Raghunathan, Election Officer, with a retired Judge of this Court be and is hereby rejected.
5. That in partial modification of the order dated 27.7.2012, it is directed that there shall be two General Body Meetings. One meeting shall before the exclusive purpose of considering the Auditors' report and the question of initiating any action/enquiry against any of the elected representatives. The second meeting shall be for electing a set of representatives. The second meeting shall be convened after the first meeting is over, with an interval of at least 30 days, so that there is time for sending notice of a duration of 21 days for the second meeting and there is also time for filing nominations, withdrawal of nominations etc.
6. That for the first General Body Meeting for considering the Auditor's report and the question of initiation of enquiry, Mr.M.K.Kabir, learned senior counsel at 67, Law Chamber, High Court Madras, be and is hereby appointed as the Chairman and he shall send a notice to all the 2152 or so members of the Club, convene an Extraordinary General Body Meeting. The notice shall be sent by courier. It shall also be sent by e-mail, wherever possible. The notice shall be accompanied by (a) the entire text of the fair order dated 27.7.2012, (b) the entire test of the fair order passed this day and (c) the summary of the issues and the observations made by the Chartered Accountants, and in order to avoid any dispute or confusion, a tabular form, annexed to this order about the issues and the allegations taken up by the Auditors for consideration and the findings recorded by them in the body of their report. The venue of the meeting shall be the Club itself. For the convenience of the members, the Chairman of the meeting shall fix the meeting on a Saturday, so that there is good participation. The notice shall indicate that the meeting will commence by about 5 P.M. on the date fixed and may go on till 8 P.M., allowing free discussion and allowing free participation for the elected representatives, to explain their stand. The voting shall commence from 8 P.M. onwards and can go on till 9.30 P.M. The entry of the members for the meeting shall be allowed from 5 P.M. to 8 P.M. and for the voting shall commence at 8 P.M. and conclude at 9.30 P.M.;
7. That the Agenda for the first Extraordinary General Body Meeting shall be as follows:
"The members are hereby informed that the following resolution is proposed to be put to vote, on Saturday, the....th day of October 2012, at the premises of the Club, after discussions, for the consideration of the members:-
`Whether in the light of the Auditors' Report, any enquiry/action requires to be initiated against any of those who were elected either as Office bearers or as Committee members during the period 2008-2009 and 2009-2010' The meeting will commence at 5.00 P.M. and voting will take place from 8.00 P.M. to 9.30 P.M. The entry of members will be permitted from 5.00 P.M. till 8.00 P.M., so that there is maximum participation. Beyond 8.00 P.M no one will be permitted and only those who have arrived for the meeting upto 8.00 P.M will be permitted to vote from 8.00 to 9.30 P.M. For the convenience of the members, the Office bearers/Committee members, who held such positions during the period 2008-2009 and 2009-2010 are furnished in the Annexure to the ballot paper. In the ballot paper, the members may write by hand, the names of those persons against whom they want enquiry/action to be initiated. In case a member wants action to be initiated against all those whose names are found in the Annexure to the ballot paper, it is enough if he/she writes the word "all". If a members thinks that no action need be initiated against anyone, he/she may write the word "none". But if he/she wishes to name any one or more individuals against whom enquiry is to be initiated, he/she must write the name of such person/persons in the ballot paper by hand.
The ultimate decision to initiate action/enquiry against any person will depend upon whether the name of such person is written by a simple majority of persons present and voting. The simple majority will be determined with reference to the total number of persons who cast their votes and not with reference to the total number of persons who attend the meeting (and possibly go without casting a vote). No proxy will be permitted for the meeting.
Members should note that if by a simple majority, a decision is taken to initiate enquiry against any person, such person will be disqualified from contesting the ensuing elections".
8. That the Chairman of the Meeting appointed herein shall be paid a remuneration of Rs.50,000/- (Rupees fifty thousand only) and the Secretary of the Club is directed to provide secretarial assistance to the Chairman appointed herein.
9. That the Chairman of the meeting shall send the Agenda as indicated in Clause (7) supra along with (a) the full text of the order dated 27.7.2012 (b) the full text of the present order and ) the Annexure to this order which contains the issues raised and the findings recorded by the Auditors.
10. That the Chairman of the meeting shall get printed, ballot papers as well as an Annexure to the ballot paper and the Annexure to the ballot papers shall contain the names of all Office bearers and committee members who got elected during the period 2008-2009 and 2009-2010. The ballot papers shall be distributed to the members present at the meeting after recording their names and membership numbers in a separate register, opened by the Chairman. While distributing ballot papers, the Chairman may get the signature of the concerned member in the register so maintained, as against the column containing the name and membership number.
11. That the Chairman shall ensure that the ballot papers contain sufficient space for the electors to write the names of persons against whom they wish an enquiry to be initiated.
12. That the Chairman shall also ensure that the name of dead persons are not found in the Annexure to the ballot paper. Sufficient number of booths shall be kept inside the hall, to ensure that the voting takes place quickly and also the secrecy is maintained.
13. That the Chairman of the meeting shall file a report on 29.10.2012, after the conduct of the first General meeting.
14. That the Rev.A.N.3978 of 2012 be posted on 29/10/2012."
The learned single Judge had also incorporated the issues/allegations raised before the auditors and the observations recorded by the auditors, as part of his order, dated 21.9.2012.
42. The learned counsel appearing on behalf of the appellant, in O.S.A.No.408 of 2012, had submitted that the impugned order of the learned single Judge, dated 21.9.2012, is contrary to law and the facts of the case and the materials on record. The impugned order is beyond the scope of Section 114 of the Civil Procedure Code , 1908.
42.1. It had been further submitted that the learned single Judge had failed to appreciate the fact that, while reviewing his earlier order, dated 27.7.2012, in Application No.98 of 2012, he had re-written the original order, dated 27.7.2012, made in Application No.98 of 2012. The learned single Judge had ignored the Rules and the Bye-laws of the respondent Club, while passing the impugned order. While considering the scope and ambit of Rule XXI of the respondent Club, the learned single Judge had rendered his findings stating that the existing office bearers could not come under the category of those who are facing an enquiry or disciplinary action, in the light of the findings found in the auditors' report. However, he had erred in law in holding that a majority decision of the governing body, to initiate an enquiry or disciplinary action against the office bearers, would be sufficient to disqualify them from contesting the election for the posts of the office bearers of the Club. In effect the learned single Judge had re-written the entire Rules and the Bye-laws of the respondent Club, which are of a contractual nature, governing the administration of the Club.
42.2. The learned single Judge had over-reached his judicial function by establishing an entirely new procedure for disqualifying the member from contesting the ensuing election. It has also been submitted that the voting procedure established for initiating the enquiry or disciplinary action against the officer bearers and the members of the committee is not the right solution for the issues that had arisen for the consideration of the learned single Judge. Even otherwise, any decision that would be taken by the members of the general body, without having full knowledge of the auditors' report and the report of the Investigation Committee, would be biased in nature. It would also be infringing the principles of natural justice, as such a decision would be made without giving a reasonable opportunity of hearing to the office bearers and the members of the Committee, against whom the charges had been levelled. Therefore, the impugned order of the learned single Judge is liable to be set aside.
42.3. The learned counsels appearing on behalf of the appellants in O.S.A.Nos.126 and 128 of 2013, had stated that the order of the learned single Judge, dated 27.7.2012, is in violation of the Bye-laws of the respondent Madras Gymkhana Club. The order of the learned single Judge is fraught with inconsistencies and contradictory findings and therefore, it deserves to be set aside. He had further submitted that the impugned order, dated 27.7.2012, is liable to be set aside, as it had traversed beyond the scope of the relief prayed for in the suit, in C.S.No.754 of 2010, and it had expanded the subject matter of the suit. The impugned order had failed to appreciate that the direction to refer the question of initiating action against the office bearers and the members of the Committee was beyond the scope of the prayer in the application, in A.No.98 of 2012, as well as the plaint in C.S.No.754 of 2010.
42.4. It had also been submitted that the impugned order had failed to appreciate the fact that the applicants, in A.No.98 of 2012, had requested for certain clarifications on specific issues. However, the learned single Judge had issued certain directions without proper appreciation of the subject matter of the suit, in C.S.No.754 of 2010. The learned single Judge had not appreciated the fact that all the three issues raised by the applicants, including the issue as to whether the members of the Committee should be disqualified, had already been answered by the learned single Judge. Therefore, the subsequent reference of the same question to be decided by the general body is erroneous, as it would amount to re-agitating the issue in question. The impugned order had failed to appreciate that, for disqualifying a person his responsibility, in respect of the charges alleged, should be fixed after a proper enquiry is conducted, by giving a reasonable opportunity to defend himself against the charges. Even though the auditors' report does not implicate any particular office bearer of being guilty of misconduct, it would be improper to place the subject in the agenda of the general body meeting, to initiate an enquiry against the person concerned and to disqualify him from contesting the election, contrary to the provisions of Bye-law No.XXI(2)(ii). In fact the future course of action against the office bearers/Committee Members had to be left to the wisdom of the general body, at the time of the election.
42.5. The learned single Judge had failed to appreciate that the members of the general body would not be in a position to scrutinise the auditors' report for fixing the responsibility on the individual office bearers. Even if it is decided by the members of the general body, to initiate an enquiry against the office bearers/Committee members, they cannot be disqualified from contesting the election, as it would be contrary to the Rules and the Bye-laws of the Club. Further it would be in violation of the principles of natural justice, as the office bearers and Committee members would not have a reasonable opportunity to question the auditors' report, based on which the members of the general body were expected to make a decision.
42.6. The learned single Judge, in his order, dated 27.7.2012, made in the application, in A.No.98 of 2012, had not only expanded the scope of the suit, in C.S.No.754 of 2010, but had also issued certain directions which are mutually exclusive and contrary to the directions issued in the order, dated 29.9.2011. Therefore, the order of the learned single Judge, dated 27.7.2012, is liable to be set aside.
43. The learned counsels appearing on behalf of the appellants, in O.S.A.Nos.127 and 129 of 2013, had submitted that the learned single Judge ought not to have modified the order, dated 27.7.2012, having held that the review application was not maintainable. The learned single Judge had erroneously directed that a separate Extraordinary General Meeting could be held to consider the auditors' report and to initiate enquiry against the office bearers/Committee members. If the review application was not maintainable, the order under review could not have been modified. Hence, the modification of the order under review is erroneous and invalid in the eye of law and therefore, the Extraordinary General Body Meeting, conducted on the basis of the impugned order, is also non est in law.
43.1 He had further submitted that the impugned order had expanded the scope of the order under review, dated 27.7.2012, by introducing the concept of enquiry against the `Committee Members', whereas, the order, dated 21.9.2012, had made a reference with regard to the enquiry to be held against the `office bearers'. The `office bearers' of the respondent Club would include only the President, the Vice President, the Honorary Secretary and the Treasurer, whereas, the `committee members' would include all the members of the general committee, consisting of 13 members. Hence, the impugned order of the learned single Judge, dated 21.9.2012, is liable to be set aside, as it had modified the original order on a ground which was not raised in the review.
43.2. It had been further stated that the learned single Judge, having held that the review was not maintainable, ought not to have modified the earlier order, to a substantial extent, including the direction to conduct a separate Extraordinary General Body Meeting, by fixing the agenda and the method of voting etc. Therefore, the impugned order of the learned single Judge, dated 21.9.2012, and the consequent actions thereon are non est in the eye of law and deserves to be set aside.
43.3. The order of the learned single Judge is liable to be set aside, as he had failed to appreciate that the audit report does not implicate any particular office bearer of misconduct and therefore, they had been permitted to continue to manage the affairs of the Club. Having given such a finding that none of the office bearers were guilty of any misconduct the learned single Judge ought not to have directed the general body of the Club to arrive at a decision, with regard to the same issues, in the Extra Ordinary General Body Meeting. The respondent Club had only agreed for the auditors' report to be discussed at the General Body Meeting and to have the future course of action taken, as per the wisdom of the said body. There was no suggestion made or consent given for the general body to decide as to whether any action should be initiated against the members of the committee on the basis of the auditors' report. Even otherwise, the meeting of the general body would not serve the purpose of reflecting the intent of the members of the general body, as such a decision ought to have been left to the members while casting their votes during the election of the office bearers of the Club. The procedure prescribed by the learned single Judge to be followed during the Extra Ordinary General Body Meeting, with regard to the issue relating to the initiation of an enquiry against the office bearers, committee members and with regard to their disqualification from contesting the election, are contrary to the specific procedures contemplated under the Rules and the Bye-laws of the club. Further, it is not open to the learned single Judge to modify the procedure prescribed in the Rules and the Bye-laws of the Club, with regard to the disqualification of its members from contesting the election.
43.4. It had been further stated that the format prescribed by the learned single Judge for holding the Extra-Ordinary General Body Meeting is not proper and it would not serve the purpose for which it had been formulated. Further, there was no opportunity provided for the office bearers/committee members of the Club to submit their explanations, with regard to the charges and observations found in the auditors' report. Thus, any decision that may be arrived, during the Extra Ordinary General Body Meeting, would result in the violation of the principles of natural justice. In fact the learned single Judge had left it open to the general body to decide the course of action to be taken, with regard to the allegations made against the office bearers/committee members, during the Extra Ordinary General Body Meeting. The directions issued by the single Judge would amount to the conducting of a summary trial against the office bearers/committee members, without giving them an opportunity to meet the allegations made against them.
43.5. It had been further stated that the learned single Judge had failed to appreciate that the issue of disqualification of the members of the present committee, for contesting the election, was beyond the scope of the averments and the relief sought in the plaint, in C.S.No.754 of 2010. Further, the directions issued by the learned single Judge, in his order, dated 21.9.2012, goes beyond the scope of the order, dated 29.9.2011, made in the application, in A.No.4545 of 2011. The order, dated 29.9.2011, had contained a specific direction that once the accounts for the years 2008-2009 and 2009-2010 are clarified by the court appointed auditors, the present Committee could call for the Annual General Meeting to pass the accounts. However, the directions issued by the learned single Judge in the order made in the application, in A.No.98 of 2012, are contrary to his earlier directions issued in the order, dated 29.9.2011. Further, the directions issued by the learned single Judge, in his order, dated 21.9.2012, are contrary to Rule XXI(2)(ii) relating to the disqualification of the members from contesting the election. The said rule requires that there should be an enquiry or disciplinary action pending against the member, for being disqualified from contesting the election. However, in the impugned order of the learned single Judge, dated 21.9.2012, it has been noted that a member would stand disqualified from contesting the election if the general body votes in favour of conducting an enquiry against him, even though the bye-laws contemplate that the pending enquiry against the member should have been initiated at least 60 days before the notification of the election. Further, the impugned order of the learned single Judge had given three options to the members of the general body for initiating the enquiry. The options to be exercised by the members of the general body were `all' `none' or `against specific members'. Such a procedure will result in an anomalous situation, making it difficult to arrive at a proper result.
43.6. It has been further stated that if certain charges are levelled against the office bearers/committee members they should be given a proper charge memo before any action could be initiated against them. Further, a proper enquiry should also be conducted by giving them a reasonable opportunity of defending themselves during the enquiry. Only after following the necessary procedures an office bearer or the member of the Committee would be found to be guilty of the charges levelled against him. As such, an officer bearer or the member of the Committee cannot be disqualified from contesting the election merely based on the observations made in the auditors' report, or by taking into account the pre election voting by the members of the general body. Therefore, the impugned order of the learned single Judge, dated 21.9.2012, made in the review application, in Review Application No.3978 of 2012 and all the procedures and the processes based thereon are liable to be set aside, as they are non est in the eye of law.
44. Certain common contentions have been raised by the counsels appearing on behalf of the appellants, in the appeals, in O.S.A.Nos.126 to 129 of 2013. The learned counsels had submitted that the learned single Judge had erred in expanding the scope of the civil suit, in C.S.No.754 of 2010, while passing the impugned orders, which have been challenged in the said appeals. They had also stated that the observation of the learned single Judge that the Madras Gymkhana Club is not being run in accordance with the Rules and the Bye-laws of the Club is not correct. Further, the disqualification of the office bearers and the members of the Committee from contesting the election, if an enquiry is initiated against them, by way of a resolution passed in the Extraordinary General Body Meeting, is contrary to the Rules and the Bye-laws of the Club. They had submitted that it is for the members of the general body to decide, as to whether the present office bearers and the Committee members should be re-elected in the election to be conducted in respect of the Club. Any disqualification imposed on them from contesting the election would cause a serious aspersion on their conduct and character and it would cause irreparable harm and mental agony to such persons. Therefore, the appropriate course of action would be to appoint an Election Officer to conduct the election for the post of office bearers of the Club, in accordance with the existing Rules and the Bye-laws of the Club. Thereafter, it is for the elected office bearers of the Club to take a decision, with regard to the initiation of an enquiry, in respect of the allegations made against the present office bearers and the members of the Committee, in view of the observations made in the auditors' report and the report of the Investigation Committee.
45. Mr.S.Parthasarthy, the learned senior counsel appearing on behalf of the respondents 1 to 6, the plaintiffs in the civil suit, in C.S.No.754 of 2010, had submitted that the claims made on behalf of the appellants in the present appeals are devoid of merits. It had been stated that serious allegations had been levelled against the office bearers and the committee members of the Madras Gymkhana Club and therefore, they are ineligible to contest in the ensuing election. Even though the elected term of the office bearers had expired they had continued to administer the affairs of the Club, in spite of the serious charges that had been levelled against them. The office bearers of the Club and the Committee members have been conducting themselves in a manner prejudicial to the interests of the Club. Therefore, this Court had found it fit to direct the filing of the report, by the auditors, after auditing the accounts for the financial years 2008-2009, 2009-2010 and 2010-2011. From the observations made in the auditors' report it is clear that the office bearers and the Committee members had indulged in serious irregularities in the financial management of the funds belonging to the Club.
46. It had been further submitted that the learned single Judge, in his order, dated 27.7.2012, had clearly stated that if the general body resolves to initiate disciplinary action against one or more members of the Club, they shall be disqualified from contesting the election. It had been made clear that the decision of the general body to order an enquiry will disqualify the office bearers and the committee members. As such it is not open to the appellants to claim that they cannot be disqualified from contesting the election, as per the Rules and the Bye-laws of the club. In fact, they stand disqualified from contesting the election, as per the Rules and the Bye-laws of the Club, in view of the resolution passed on 1.9.2010. Even otherwise, in view of the fact that the office bearers and the Committee members were responsible for the financial irregularities of the Club, they cannot have any defence from being disqualified from contesting the ensuing election.
47. The learned counsel had also submitted that after a decision had been taken by a majority of the members of the general body conducted recently, the office bearers and the members of the Committee would stand disqualified from contesting the election, as per the relevant provisions of the Rules and the Bye-laws of the Club. Therefore, the appeals filed against the order of the learned single Judge, with regard to the disqualification of the office bearers and the members of the Committee, would be infructuous.
48. He had further submitted that the appeal filed on behalf of the Madras Gymkhana Club cannot be maintained after the passing of the resolution against the present office bearers of the Club. The Club cannot be said to be an aggrieved party, as there is no finding against the interest of the Club in the impugned orders of the learned single Judge, which are under challenge in the present appeals. The learned counsel had also pointed out that, when the first order passed by the learned single Judge, dated 29.9.2011, in A.No.4545 of 2011, had not been challenged, it would not open to the appellants to challenge the order passed by the learned single Judge, in the Review Application, in Review Application No.3978 of 2012.
49. It has been further submitted that the intention of the appellants is not bona fide in nature. The appeals have not been filed in the interests of the Club and its members. The appellants have filed the present appeals only with the mala fide intention of continuing in office, indefinitely, and to thwart the attempts made by a number of members of the Club, to hold a enquiry against the financial and the other irregularities committed by the office bearers and the Committee members. He had further submitted that it would not be open to the office bearers and the Committee members to state that they cannot be disqualified from contesting the election, as no enquiry had been initiated against them, based on the allegations levelled against them.
50. The learned counsel had further stated that, in the general body meeting of the Club, held recently, a resolution had been passed, to conduct an enquiry against the office bearers and the members of the Committee who were involved in committing the irregularities, by an overwhelming majority. Therefore, it would not be appropriate for the present office bearers and the members of the Committee to claim that they would not stand disqualified to contest the election, as per Bye-law XXI(2) of the Rules and the Bye-laws of the Club. If the present office bearers are permitted to contest the election, by filing their nominations, the larger interests of the club and its members would suffer. Therefore, this Court may be pleased to dismiss the present appeals and to direct the conducting of the election, making it clear that the present office bearers and the Committee members, against whom certain allegations have been levelled, would stand disqualified.
51. In view of the submissions made by the learned counsels appearing on behalf of the appellants, as well as the respondents and on a perusal of the records available it is noted that the order passed by the learned single Judge, dated 21.9.2012, in the review application, in Review Application No.3978 of 2012, had exceeded the scope of the reliefs prayed for in the suit, in C.S.No.754 of 2010. Further, the learned single Judge had passed the order, dated 27.7.2012, in the application, in Application No.98 of 2012, giving certain clarifications based on the request made by the applicants therein. However, while passing the order, dated 21.9.2012, in the review application, in Review Application No.3978 of 2012, the learned single Judge, had prescribed certain procedures and modalities for conducting of the Extraordinary General Body Meeting, even though he had refused to review the order, dated 27.7.2012.
52. It is noted that the learned single Judge had observed that the review application had highlighted some of the grievances of the applicants and some of the challenges faced in the effective implementation of the order, dated 27.7.2012. The learned single Judge had also noted that the interim report filed by the Election Officer appointed by the court had also prayed for certain directions. Therefore, despite the fact that the learned single Judge had held that the review application was not maintainable, he had issued certain directions and modifications in order to ensure that the order, dated 27.7.2012, could be implemented, without further complications.
53. In his order, dated 27.7.2012, the learned single Judge had permitted the Election Officer to send the executive summary of the auditors' report, along with the notice of the annual general meeting, to all the members of the Club, indicating that the views of the general body would be sought on the action to be taken, on the findings of the audit report. However, he had found that there were certain discrepancies between the executive summary and the findings recorded in the body of the report.
54. In view of the said findings the learned single Judge had directed the Election Officer, in his order, dated 21.9.2012, to enclose the copies of the findings, along with the notice to be issued to the members, regarding the Annual General Meeting. As such, the learned single Judge had expressed his view that the issues raised and the findings recorded in the body of the auditors' report and the copy of the full text of the order, dated 27.7.2012, as well as the order, dated 21.9.2012, could be circulated to the members.
55. The learned single Judge had held, in his order, dated 27.7.2012, that the office bearers of the Club and the members of the Committee would stand disqualified from contesting the election in the event of the general body passing a resolution to initiate an enquiry against them. Such a direction issued by the learned single Judge is, without doubt, contrary to the prevailing provisions in Bye-law XXI (ii) of the Rules and the Bye-laws of the Club. Further, the learned single Judge had stated that it is not possible to make the Club function strictly in accordance with the bye-laws and therefore, the disqualification imposed by the learned single Judge, on the office bearers and the members of the Committee, which has not been contemplated in Rule XXI(2) of the Rules and the Bye-laws of the Club, cannot be an acceptable proposition.
56. The learned single Judge had also held that the continuance of the officer bearers in their posts, beyond the prescribed tenure, is in violation of the Bye-laws. Even if it could be held that the continuance of the office bearers, in their respective posts, is not authorised, as per the Rules and the Bye-laws of the Club, it would not be proper to hold that the Club is not being run in accordance with its Rules and Bye-laws. Even otherwise, it cannot be held that an office bearer or a committee member of the Club would stand disqualified in the event of an enquiry being contemplated against him, during the Annual General Meeting, as it is contrary to Bye-law XXI(2) of the Club.
57. The learned single Judge, having noted that the procedure contemplated in his earlier order, dated 27.7.2012, would lead to confusion, had made certain modifications in his earlier order and had held that a separate meeting could be held to consider the auditors' report and for considering the question as to whether any enquiry is required to be initiated against the office bearers and the members of the Committee. He had further held that, after such an exercise had been under taken, an election schedule could be announced and the election could be conducted, after receiving the nominations. The learned single Judge, in his order, dated 21.9.2012, had modified his earlier order, dated 27.7.2012, partially. Accordingly, he had issued a direction that there shall be two general body meetings. One meeting shall be held for the exclusive purpose of considering the auditors' report and the issue relating to the initiation of an action or an enquiry against any of the representatives of the Election Committee. The second meeting shall be for electing a set of representatives. He had also prescribed the procedures to be followed by the Election Officer for holding the Extraordinary General Body meeting and for conducting the election for the posts of the office bearers of the Club. However, it is found that the procedures prescribed by the learned single Judge, in his order, dated 21.9.2012, are not in consonance with the Rules and the Bye-laws of the Club, especially, in respect of the disqualification of the members from contesting in the election.
58. The learned counsel appearing on behalf of the respondents 1 to 6 had contended that the appeals filed by the appellants, in O.S.A.No.408 of 2012 and O.S.A.Nos.126 to 129 of 2012, are not maintainable. However, we are not in a position to accept such a contention. The appeals have been filed by the Madras Gymkhana Club and the other individual persons, who are aggrieved by the order passed by the learned single Judge in the Review Application. The issues raised in the appeals are similar in nature, as they relate, primarily, to the interpretation of the Rules and the Bye-laws of the Club. The appellants had taken a similar stand before the learned single Judge. Therefore, they have filed the present appeals, being aggrieved by the order passed by the learned single Judge, enlarging the scope and the ambit of the order under review. We are of the view that the objections raised by the learned counsel, appearing on behalf of the respondents 1 to 6 are too technical in nature and therefore, they are liable to be rejected.
59. Further, the disqualification of the office bearers and the committee members from contesting the election, even before the commencement of an enquiry, is clearly contrary to procedures prescribed by the Rules and the Bye-laws of the Club. It is noted that, as per Rule 21 of the Rules and the Bye-laws of the Club, a member would stand disqualified from contesting the election only when there is an enquiry pending or when a disciplinary action has been initiated against the member, atleast sixty days prior to the notification of the election.
60. It is a settled position in law that an enquiry or a disciplinary action would commence with the framing of charges. As such, the resolution passed by the general body of the Club can only be a step in that direction. It could only be, at the most, a decision taken to initiate such action against the office bearers and the committee members of the Club. It cannot, in any case, be taken to be the initiation of an enquiry or a disciplinary action against the office bearers and the committee members of the Club. Therefore, we are not inclined to accept the contentions raised on behalf of the respondents concerned that the office bearers and the committee members would stand disqualified from contesting the election, at this stage.
61. It is noted, from the auditor's report, it is noted that none of the office bearers/committee members have been implicated, specifically, in the financial irregularities alleged to have been committed by them. Even otherwise, after the framing of charges, if any, they would be entitled to defend themselves against the allegations levelled against them. Therefore, disqualifying them from contesting the election, without following the necessary procedures, would be contrary to the Rules and the Bye-laws of the Club and the principles of natural justice.
62. Further, the contention raised by the learned counsel that the resolution passed by the General Body, to initiate action against the office bearers and the committee members, should be approved by this Court cannot be accepted, as all such acts or events, which had taken place, pursuant to the orders passed by the learned single Judge of this Court, would merge with the order passed in the present appeals. In the given facts and circumstances of the case, we find no merits in the contentions raised on behalf of the respondents 1 to 6.
63. It is also noted that the right of the member of the Club, to contest the election, is governed by the Rules and the Bye laws of the Club. There is no doubt that certain civil consequences would flow from such a right vested in the members of the Club. The question relating to the qualification or disqualification of a member, to contest the election, is prescribed by the Rules and the Bye laws of the Club. Therefore, the procedure prescribed by the learned single Judge for the disqualification of the office bearers and the committee members, which is not in tune with the Rules and the Bye laws of the Club, cannot be accepted. It is also noted that the learned single Judge had passed the order under challenge enlarging the scope of the order passed by him, earlier, much to the detriment of the applicant in the Review Petition, and to those who are similarly placed.
64. It is also noted that in the review order passed by the learned single Judge, the office bearers of the year 2008-2009 had also been included, contrary to the facts and circumstances of the case. It is not for this Court to prescribe a procedure for the disqualification of the office bearers and the members of the committee, to contest the election, contrary to the procedures established by the Rules and Bye laws of the Club. However, it goes without saying that it would be open to the office bearers, who maybe elected in the ensuing election, to decide on the appropriate course of action to be taken, based on the Auditor's report and the report of the Investigation Committee, subject to the procedures established by the Rules and the Bye laws of the Club.
65. As the present Original Side Appeals have been filed by the Club and by the other members of the Club, having been aggrieved by the order passed by the learned single Judge, dated 27.7.2012, in the Application, in A.No.98 of 2012, and the order, dated 21.9.2012, made in the Review Application No.3978 of 2012, the contention of the learned counsel appearing on behalf of respondents 1 to 6 that the appeals are not maintainable, cannot be accepted. As the issues raised in these appeals relate to the interpretation of the Rules and the Bye laws of the Club and as they are with regard to the extent of the jurisdiction to be exercised by this Court in such matters we are not inclined to accept the contentions raised on behalf of respondents 1 to 6.
66. In such circumstances, the order of the learned single Judge, dated 21.9.2012, is liable to be set aside, as prayed for by the appellants in the present Original Side Appeals. However, in view of the submissions made by the learned counsels appearing on behalf of the parties concerned and in view of the fact that the interests of the Club and its members should be protected we find it appropriate to pass an order directing Mr.M.K.Kabir, the learned Senior Advocate, to conduct the election for electing the office bearers of the Club, as per the existing Rules and the Bye-laws of the club. It is made clear that the present office bearers and the committee members could file their nominations and contest the election, if they are found to be qualified to do so, as per the existing Rules and the Bye-laws of the club. It is also made clear that the Election Officer should keep the full text of the auditors' report and the report of the Investigation Committee, for the scrutiny of the members of the club, well in advance. The auditors' report and the report of the Investigation Committee need not be circulated to the members of the Club, along with the election notice. The said report shall be kept in the office of the Club to enable the members to peruse the same during the working hours of the office of the Club. However, there is no need to furnish the copies of the reports, to the members of the Club, along with the election notice. On the completion of the election process it would be open to the elected office bearers of the Club to initiate appropriate action, if any, against those who are found to be responsible for the irregularities alleged to have been committed, taking into consideration the observations made in the auditors' report and in the report of the Investigation Committee. As such, it is made clear that it would be open to the office bearers and the members of the Committee to contest the ensuing election, unless they are otherwise disqualified, as per the Rules and the Bye-laws of the Club.
67. The Election Officer Mr.M.K.Kabir, who is appointed as the Election Officer to conduct the election, shall be paid a sum of rupees fifty thousand, by the Club, as remuneration. The Election Officer, Mr.M.K.Kabir, shall conduct the election by issuing appropriate election notices and by fixing the schedule for the election, as per the Rules and the Bye laws of the club. The Election Officer, shall complete the election process, on or before 30.6.2013, as per the Rules and the Bye laws of the Club. He shall also declare the elected office bearers, on the completion of the election process. The elected office bearers shall function as per the Rules and the Bye-laws of the club. It is made clear that the elected office bearers would continue in office till the next Annual General Body Meeting is held, on or before 30.9.2014, as per Rule XV of the Rules and the Bye laws of the Club. It is also made clear that any other subject, as found necessary, could be included in the Agenda, to be taken up during the Annual General Body Meeting, to be held, as per the directions issued by this Court, by this order, including the passing of the accounts for the years 2008-2009, 2009-2010 and 2010-2011. After the completion of the election process, the Election Officer shall file a report before this Court, for further orders, if any. Accordingly, the orders passed by the learned single Judge, dated 27.7.2012, in the Application in A.No.98 of 2012, and the order, dated 21.9.2012, made in the Review Application No.3978 of 2011, are set aside. Accordingly, the appeals stand allowed, with the above directions issued by this court, by this order.
(M.J.J.) (M.M.S.J.) Index:Yes/No 30-4-2013 Internet:Yes/No csh M.JAICHANDREN,J. AND M.M.SUNDRESH,J. csh O.S.A.No.408 of 2012 and O.S.A.Nos.126 to 129 of 2013 30-4-2013