The petitioners are all the agricultural/fishermen/multipurpose/credit co-operative societies registered under the Karnataka Co-operative Societies Act, 1959. They have filed these petitions seeking the redressal of their grievances over the cap on the withdrawal of the amounts fixed by the respondent Nos. 1 and 2 pursuant to the scheme of demonetization, as per the notification, dated 8.11.2016 (Annexure-A).

2. Prof. Ravivarma Kumar, the learned Senior Counsel appearing for Sri Mahesh R. Uppin for the petitioners submits that the restrictions imposed by the impugned notification is unenforceable in the absence of proclamation of financial emergency under Article 360 of the Constitution of India. The restriction that one customer cannot draw more than Rs. 24,000/- per week from his/her/its account in the bank is not traceable to any statutory provision.

3. The learned Senior Counsel submits that the co-operative sector in India has played a pivotal role in the national economy. About 29.7 crores of the populace in India are the members of the co-operative societies. He submits that there are about 93,000 co-operative societies in India. The co-operative societies are formed, owned and controlled by their members. Recognizing the significant contributions made by the co-operative societies and the predominant role played by them in the national economy, constitutional status is conferred upon the co-operative societies with the Parliament enacting the Constitution (ninety-seventh Amendment), Act, 2011. Article 19(1)(c) in Part-3 of the Constitution has been amended to make the formation of a co-operative society a fundamental right of the citizens. The mandate of the said amendment is, inter alia, to strengthen the co-operative movement in India by providing for the autonomous functioning of the co-operative societies. As the right to form a co-operative society has now become a fundamental right and as each member of the cooperative society is its owner, neither the Central Government nor the State Government have any power to interfere in the administration of the co-operative societies. He submits that the imposition of the outer limit of Rs. 24,000/- withdrawal a week has crippled the very functioning of the co-operative societies.

4. When the Parliament does not have the competence to enact any law pertaining to the co-operative societies, the enquiry into the motive, which weighed with the Central Government in coming out with the cap on the withdrawal of the amounts by the co-operative societies is not required at all. In support of his submissions, he relies on the Apex Court’s judgment in the case of DHARAM DUTT AND OTHERS v. UNION OF INDIA AND OTHERS reported in (2004) 1 SCC 712.

5. He submits that the restriction on the withdrawal of the amounts fixed by the respondent Nos.1 and 2 is unscientific and impractical. He submits that the respondents are not justified in treating the co-operative societies on par with the individuals. If an individual is permitted to withdraw Rs. 24,000/- a week, then the co-operative society has to be permitted to withdraw the amounts in proportion to the number of its members. That is if a co-operative society has 20 members, then that co-operative society should be permitted to withdraw Rs. 4,80,000/- [24,000 x 20]. Treating the individuals and the co-operative societies alike is putting the oranges and bananas together in one basket.

6. He submits that imposing the restriction that an account-holder can withdraw the amounts not exceeding Rs. 24,000/- a week is not a reasonable restriction permitted by Article 19(4) of the Constitution of India. It cannot be said that such restriction is imposed in the interest of sovereignty and integrity of India or public order or morality. He brings to my notice that the impugned notification does not refer to any of these four enumerated factors. He submits that the co-operative societies’ matters, etc. are at Entry No.32 in List-II (State List)