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2025 Supreme(Kar) 852
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
K.S. HEMALEKHA, J.
Sri M.P. Chandrashekhar, S/o Sri M. Puttaswamy - Appellant
Vs.
State Of Karnataka - Respondent
Writ Petition No.663 Of 2025 (CS-EL/M)
Decided On : 02-05-2025
Advocate Appeared:
For the Appellant :Smt. Vaishali Hegde, Advocate
For the Respondent:Smt. Hemalatha V., AGA A/W Smt. Prathima Honnapur, AAG, Sri T.L. Kiran Kumar, Advocate Sri B.L. Sanjeev, Sri Sandesh T.B., Advocate Sri A. Mohammed Tahir, Advocate
The court confirmed that the nomination of a director for a cooperative society is valid if the society qualifies as 'assisted' under the KCS Act due to recent government aid, and established limitations on individual standing to challenge such nominations.
Headnote:(A) Karnataka Co-Operative Societies Act, 1959 - Section 28A(4-B)(1) - The State Government may nominate a representative on the board of every assisted society; criteria for designation of an assisted society is defined under Section 2(a-1-1) of the Act. (Para 9, 10)
(B) Locus Standi - Section 29-G(4)(j) of the Act empowers only the Chief Administrative Officer to sue on behalf of the society, thus, an individual member's petition is maintainable when legal rights are affected. (Para 14, 15)
Facts of the case:
The petitioner challenged the nomination of an individual's appointment as director of a society, asserting the society's non-assisted status. The society received government funds, thereby qualifying as an assisted society.
Findings of Court:
The nomination was valid under KCS Act provisions as the society received recent financial assistance.
Issues: (i) Is the nomination of respondent No.8 legally valid? (ii) Does the petitioner have standing to challenge the nomination?
Ratio Decidendi: The court upheld the validity of the nomination based on recent financial assistance received by the society, and reinforced the principle that individual members of a cooperative society generally have no independent right to challenge internal decisions unless their own rights are directly affected.
Result: Petition dismissed.
| Table of Content |
|---|
| 1. petitioner's grievance regarding appointment. (Para 1) |
| 2. court's analysis of statutory provisions and interpretation. (Para 2 , 8) |
| 3. arguments regarding definition of 'assisted society.' (Para 3 , 4) |
| 4. locus standi of society member in writ petition. (Para 6 , 7) |
| 5. criteria for nomination of directors under kcs act. (Para 9 , 10 , 11) |
| 6. judicial interpretation of cooperative member rights. (Para 12 , 14 , 15 , 16) |
| 7. dismissal of petition for lack of legal grounds. (Para 17) |
ORDER :
K.S. HEMALEKHA, J.
The petitioner aggrieved by the notification dated 28.02.2024 issued by the respondent No.1 appointing respondent No.8 as the nominated Director of the board of management of the respondent No.4 – Society and also aggrieved by the draft eligible voters list dated 04.12.2024 published by respondent No.6 including the name of respondent No.8 as a representative / delegate for respondent No.4-society in the election to the Mandya District Cooperative Milk Producers Society Union Limited (‘Union’ for short) is before this Court in this writ petition.
2. Heard Smt. Vaishali Hegde, learned counsel for the petitioner, Smt. Hemalatha .V, learned AGA along with Smt. Prathima Honnapura, learned AAG for respondent Nos.1 to 3 and 6, Sri Sandesh T.B., learned counsel respondent No.4-society.
3. Learned counsel for the petitioner drawing the attention of this Court to Section 28A (4-B)(1) of the KARNATAKA CO-OPERATIVE SOCIETIES ACT , 1959 (for short ‘KCS Act’) submits that respondent No.4 being not a assisted society, therefore, the nomination of respondent No.8 by the State Government to the Board of Management of respondent No.4-society violates Section 28A (4-B)(1).
4. Per contra, the learned counsel for respondent No.8, learned AAG and counsel appearing for respondent No.4 – society submits that the society has received a sum of Rs.1 Lakh from the MLA fund sanctioned by the Government on 06.02.2024 and as such, the respondent No.4 is an assisted society as defined under Section 2(a-1-1) of the KCS Act and as such, nominating the respondent No.8 as a representative of the Government to the board of director of respondent No.4-society is in conformity with Section 28A (4-B) (1) of the KCS Act.
5. In support, learned AAG produces the copy of the notification dated 06.02.2024 indicating that there was grant by the Government to the society. The CEO of the respondent No.4-society files an affidavit stating at paragraph Nos.3 and 4 as under:
“3. I stated that the society have received the amount of Rs.2,792/- from the Zilla Parishath, through District Rural Development Society, in way back during the 1986, that has been reflected in the audit report for the year 1986-87. Copy of the audit report from the year 1986-87 is produced same may kindly peruse the documents.
4. I state that the Assistant Commissioner of Mandya sub-division had issued official remainder dated 06/02/2024, under the local area development scheme of the MLA had granted Rs.1 Lakh rupees for the development of society, thereafter the society was handed overing the site for work as estimated in the notification dated 06/02/2024.”
(Emphasis supplied)
6. It is stated by the State and the private respondents that the present writ petition is by the member of the society who has no locus standi, as under Section 29- G (4)(j) of the KCS Act it only empowers the Chief Administrative Officer of the society who can sue or be sued on behalf of the cooperative society.
7. In this context, learned counsel appearing for the petitioner submits that the contention of the respondents that the writ petition filed by a member of the cooperative society is not maintainable under Section 29-G(4) (j) of the KCS Act is unsustainable. It is submitted that Section 29-G (4)(j) merely empowers the Chief Executive Officer to sue and be sued on behalf of the society, it does not prohibit an individual member or share holder for independently maintaining a writ petition and therefore, the arguments
