In the absence of a specific provision in the Act, Rules, or Bye-laws of a co-operative society, the Managing Committee does not have the inherent or implied power to remove the Chairman and Vice Chairman by passing a resolution of vote of no-confidence.

Headnote:
CO-OPERATIVE SOCIETY - ELECTION - VOTE OF NO-CONFIDENCE - In the absence of any provision in the Act, Rules or the Bye-laws of the Society, Managing Committee cannot pass a resolution of no confidence against the Chairman and Vice Chairman before expiry of their term.
Fact of the Case:

The petitioners, Chairman and Vice Chairman of a co-operative society, challenged a resolution passed by the Board of Directors expressing a vote of no-confidence against them. The petitioners contended that there was no provision in the Act, Rules, or Bye-laws of the society that conferred a right upon the members of the Managing Committee to pass a no-confidence motion against the Chairman and Vice Chairman.
Finding of the Court:

The court held that in the absence of any specific provision, the members of the Board of Directors did not have inherent or implied powers to remove the Chairman and Vice Chairman by passing a resolution of vote of no-confidence. The court further held that the term of office prescribed for the Chairman and Vice Chairman was not wholly unqualified or unconditional and that the legislature had made various provisions for the removal of members of the Board.
Issues: Whether in the absence of any provision in the Act, Rules or the Bye-laws of the Society, Managing Committee can pass a resolution of no confidence against the Chairman and Vice Chairman before expiry of their term?
Ratio Decidendi: The court relied on the provisions of the Maharashtra Co-operative Societies Act, 1960, the bye-laws of the society, and various judicial precedents to arrive at its decision. The court held that the right to contest elections and the right to move for setting aside an election or right to recall the person already elected are not common law rights and must be conferred by the statute and, therefore, can be enforced only in accordance with subject to the condition laid down therein by the statute concerned.
Final Decision: The court set aside the resolution of non-confidence passed against the petitioners and held that the Chairman and Vice Chairman were entitled to continue in office for the unexpired period of their tenure.

JUDGMENT - C.S. DHARMADHIKARI, J.:---As, in both these petitions, common questions of law and fact are involved, they were heard together and are being disposed of by this common judgment. Shri Dudhganga Vedganga Sahakari Sakhar Karkhana Limited (hereinafter referred to as the Society) is a registered co-operative society registered under the Maharashtra Co-operative Societies Act, 1960 (hereinafter referred to as the Act). In the Year 1973 the said Society was declared as the specified society under section 73-G of the Act. On 5-11-1976 the bye-laws of the Society were amended.

2. In April 1979 the present Board of Directors was elected and petitioners Nos. 1 and 2 in Writ Petition No. 1791 of 1981, i.e. Hindurao and Shankarrao, was elected as Chairman and Vice Chairman respectively. These elections were held as per the procedure prescribed under Chapter XI-A of the Act. On 19th of May, 1981 a notice was issued by the Managing Director of the Society to convene a meeting of the Board of Directors on 27th of May, 1981 for passing a vote of no-confidence against the Chairman and Vice Chairman. It appears from the record that on 21st of May, 1981 petitioner Shankarrao filed a dispute under section 91 of the Act with the Regional Deputy Director of Sugar Kolhapur, challenging the notice, dated 19-5-1981 issued for convening the meeting for passing a vote of no-confidence. In the said dispute the authority concerned did not pass any interim orders. Hence on 27th of May, 1981 a resolution expressing a vote of no-confidence was passed by the majority of the members of the Board against the Chairman as well as the Vice Chairman. On 28th of May, 1981 the petitioners moved the Regional Deputy Director of Sugar for interim relief. But the said application was rejected and, thereafter the dispute itself was withdrawn as it had become infractous. Thereafter a notice was issued by the Managing Director of the Society for convening a meeting on 6th of June, 1981. Petitioner No. 2 Shankarrao, filed a second dispute with the Regional Director of Sugar, Pune, obviously under section 91 of the Act praying inter alia for an order of prohibition restraining the Board of Directors from electing a new Chairman and Vice Chairman. The said dispute was referred to the Co-Operative Court No. 2, by the Director of Sugar vide order dated 3rd of June, 1981. On 4th of June, 1981 an ad interim injunction was granted by the Co-operative Court and it further directed that a notice should be issued to the opponents who had filed caveat, returnable on 5th of June, 1981. Thereafter the case was adjourned for 6th of June, 1981. In the meantime petitioner, Shankarrao approached the Co-operative Appellate Court and obtained an ex parte injunction restraining the respondents from holding the meeting. In view of this appellate order, earlier order passed by the Co-operative Court refusing the injunction was kept in suspension. Thereafter the respondents filed a writ petition before this Court bearing Writ Petition No. 1574 of 1981 and obtained an ex parte stay order on 8th of June, 1981. On 12th of June, 1981 petitioner Shankarrao applied for vacating the interim relief. On the statement made by the learned Counsel for the other side that the elections of the Chairman and the Vice Chairman will not be held, till 16th June, the matter was adjourned. Ultimately when the matter came up before us on 17th June, 1981 we admitted the petition and issued rule returnable on 3-7-1981. During the course of the hearing at the admission stage itself both the parties have put in writing the question of law, which is involved in this petition, namely :

"Whether in the absence of any provision in the Act, Rules or the Bye-laws of the Society, Managing Committee can pass a resolution of no confidence against the Chairman and Vice Chairman before expiry of their term? "

3. The parties also agreed that during the pendency of this petition fresh elections will not be held. Therefore, the

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