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1997 Supreme(SC) 875

1997(6) Supreme 204
SUPREME COURT OF INDIA
K. Ramaswamy and D.P. Wadhwa, JJ.
K. Shantharaj & Anr. -Appellants
versus
M.L. Nagaraja & Ors. -Respondents
Civil Appeal Nos. 4271-73 of 1997
Decided on 9-5-1997.
Counsel for the Parties :
For the Appellants : N. Santosh Hegde, Sr. Advocate, Dayan Krishnan, Nikhil Nair and Mrs. B. Sunita Rao, Advocates.
For the Respondents : Salman Khursheed, Vivek Reddy and E.C. Vidya Sagar, Advocates.

Important Point
Administrator appointed u/s 30 of Karnataka Co-operative Societies Act is not vested with power to enrol new members of the Society.

Headnote:Karnataka Co-operative Societies Act, 1959-Section 30-A-Appointment of Administrator to manage affairs of the Society-Schedule of programme for conducting elections to the Committee given by Administrator-Enrolment of new members-Challenged-Administrator was empowered to take such action as was necessary for proper functioning of the society as per law-He was not vested with powers to enrol new members of the Society-He was to conduct election with the members as on the roles. (Paras 4 & 7)

       

ORDER

Leave granted.

We have heard learned counsel on both sides.

2. These appeals by special leave arise from the judgment of the Division Bench of the Karnataka High Court, made on March 17, 1997 in Writ Appeal Nos. 1464-66/94.

3. The indisputable facts are that the Committee was superseded by the Administrator who has been appointed by the Government to manage the affairs of the Society, pending further action. During the period of the administration, the Administrator had enrolled new members and given schedule of programme for conducting the elections to the Committee. The respondents challenged the order of appointment of the Administrator. The learned single Judge, while setting aside the order of appointment, held that the Administrator has no power to enroll new members; but he could conduct elections to the Committee of the Society as per the schedule of the programme. That was confirmed by the Division Bench. The material provisions in that behalf are contained in Sections 30 and 30-A of the Karnataka Cooperative Societies Act, 1959 (for short, the Act ). They read as under :

"30. Supersession of Committee:

(1) If, in the opinion of the Registrar-

(a) the committee of a co-operative society persistently makes default or is negligent in the performance of the duties imposed on it by this Act or the rules or the bye-laws or commits any Act which is prejudicial to the interest of the society or its members or is otherwise not functioning properly; or

(b) a co-operative society is not functioning in accordance with the provisions of this Act, the rules or bye-laws or any order or direction issued by the State Government or the Registrar, the Registrar may, after giving the committee an opportunity to state its objections, if any, order in writing remove the said committee, and appoint an administrator to manage the affairs of the society for such period, not exceeding one year, as may be specified by the Registrar.

(2) The administrator so appointed shall subject to the control of the Registrar and such instructions as he may give from time to time, exercise all or any of the functions of the committee or of any officer of the co-operative society and take such action as he may consider necessary in the interest of the society.

(3) The administrator shall, before the expiry of his term of office arrange for the constitution of a new committee after holding the election in accordance with this Act, the rules and the bye laws of the co-operative society.

Provided that in such an election no member of the Committee removed under sub-section (1) shall, notwithstanding anything contained in this Act, the rules or the bye-laws, be eligible for being elected as a member of the committee, for a period of four years from the date of supersession of the Committee under the said sub-section.

Provided further that if the committee elected in accordance with this sub-section is also superseded within a period of one year from the date of its election, such supersession may extend to a period not exceeding three years.

30A. Appointment of Special Officer:

(1) Where the State Government on a report made to it by the Registrar or otherwise, is satisfied that any co-operative society is not functioning in accordance with the provisions of this Act or the rules made thereunder or its bye-laws or any order, direction circular issued by the State Government or the Registrar it may, notwithstanding anything in this Act, by order, appoint a Special Officer for such co-operative society for such period not exceeding two years :

Provided that the State Government may, if it considers it necessary extend the said period of two years by such further period not exceeding one year.

(3) The Special Officer subject to the control of the State Government and the Registrar, exercise and perform all the powers and functions of the committee of the co-operative society or any officer of the co-operative society and take all such actions as may










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