1988 Supreme(Bom) 105

IN THE HIGH COURT OF BOMBAY
C. Mookerjee, C.J. C.S. Dharmadhikari, J.
Bhandara District Central Co-op. Bank Ltd.,
Bhandara others.... Petitioners.
Versus
State of Maharashtra another .... Respondents.
Writ Petition No. 2098 of 1986, decided on 21-3-1988.
Advocates appeared :
Dr. B.R. Naik with Y.R. Naik, for petitioners.
A.S. Bobde, A.G. with M.B. Mehere and V.A. Gangal, A.G.P., for respondent.

Headnote:Sections 73 - A (1) (2) (2 - A) (4) (5) - (As inserted by Maharashtra Amending Act, XXVII of 1969, Maharashtra Act, XXVU of 1971. Maharashtra Amending Act, III of 1974, Maharashtra Act XLV of 1983, and Maharashtra Act, XX of 1986) - Constitution of India - Articles 14 and 19 - Constitutional validity of Section 73 - A - Designated officers - Categorisation - Under inclusive classification - Justification - Held, not violative of Articles 14 and 19 of the Constitution. (AIR 1984 Bom 81: AIR 1944 Bom 47: (1974) 1 ILR (All) 1 and AIR 1975 SC 1030 followed: (1984) 2 Guj LR 1244 distinguished).

       The provisions of sub - sections (1), (2) and (4) were previously challenged before two Division Benches of this Court both of which had rejected the contentions that the said provisions were ultra vires Article 19 of the constitution of India, vide the decision of Chandurkar, Acting C. J. (as the then was) and Kurdukar, J. in the case of Shree S. S. Sakhar Karkhana Ltd. v. State of Maharashtra, AIR 1984 Born 81 and the decision of Shah and Mohta, JJ. in the case of Manohar v. State of Maharashtra, AIR 1984 Born 47. Shah and Mohta. JJ. in case of Manohar v. State of Maharashtra had also rejected the contention that Section 73 - A of the Maharashtra Co - operative Societies Act contravened Article 14 of the Constitution of India. In view of these binding decisions, it is not necessary for us to again set out in extenso the reasonings for which we conclude that the challenge to the vires of sub - sections (1) to (5) of Sections 73 - A of the Maharashtra Co - operative Societies Act is bound to fail. We follow the aforesaid two Division Bench decisions with which we respectfully agree and we only set out some additional reasons for upholding the validity of Section 73 - A.

       It is settled law that a Legislature cannot foresee and provide for all future contingencies. Therefore, the Legislature may provide for delegated legislation within the ambit of the policy laid down by the Legislature. The argument of under - classification was sought to be raised both with reference to sub - section (1) and sub - section (2) of Section 73 - A, but we may indicate that taking into account the provisions of sub - section (1) and sub - section (2) of Section 73 - A together it is possible to include all officers within the scope of Section 73 - A.

       In the case of Anandrao Dnyandeo Patil Alias Ghuyekar v. The State of Maharashtra and others [Writ Petition No, 3470 of 1984]. the Division Bench held that use of the expression "or" in clause (iii) of Section 73 - A (2) was made in the disjunctive sense and did not mean "and". It was further held that the classification made by Section 73 - A (2) was not violative of Article 14. We respectfully agree with the above interpretation of sub - section (2) of Section 73 -A Categorisation an the basis of geographical situation or amount of share capital was legitimate and valid.

       In considering the validity of Section 71 - A, the Court ought to take into consideration the entire recommendations regarding curing this illicit growth of vested interest in the Co - operative Societies by reason of simultaneously holding office by designated officers and by holding for indefinite length of time such offices.

       In the case of Trilok Singh v. State of U. P., (1974) I ILR All 1, the Division Bench of the Allahabad High Court had upheld Rule 449 of the U. P. Co - operative Societies Rules read with Section 130 of the U. P. Co - operative Societies Act, 1965.

       The said decision of the Allahabad High Court cannot be distinguished on the ground that while Section 73 - A of the Maharashtra Act imposes bar upon only designated officers of specified societies the Uttar Pradesh Rule applies to all holding elective offices in Co - operative Societies.

       Strictly speaking Article 19 (1) (g) has hardly any application to the facts of the present case because Section 73 - A does not seek to restrict the right of the Co - operative Societies to carryon their business. Holding of posts of designated officers cannot be also termed as profession, trade or business.

       In the instant case, we find that classification into different categories according to geographical situation of the Societies and the amount of authorised share capital have nexus with the object of the legislation in prohibiting growth of vested interests in the Co - operative Societies.

       A person who is simultaneously elected to more than one Co - operative Society belonging to the categories specified in sub - section (2) ought to be granted a reasonable time to exercise his option whether he would prefer to continue and thereby incur the adverse legal consequence of such simultaneous membership or would resign or relinquish his post of designated officer in one of the Societies of the specified categories and thereby retain his post in one Society only. It is reasonable to give such opportunity to exercise ones option within a certain time.

       The legal position has not changed merely by reason of the amendment of sub - section (5) made by Maharashtra Act XX of 1986 by substituting the words "for a period of more than ten years in the aggregate" in place of the words "for a consecutive period of more than ten years". Whether the period mentioned in Section 73 - A (5) ought to be consecutive or in aggregate was a matter for the Legislature to decide. Therefore, Substitution of ten years in the aggregate in place bf consecutive ten years would not affect the constitutional validity of the section. In computing the aggregate period of ten years in office, the explanation (a) to sub - section (5) of Section 73 - A may be noted; under said explanation any period for which a person concerned who has held such office before the Commencement of the Maharashtra Co - operative Societies (Amendment Act, 1969, has to be ignored. Therefore, the commencement of the period of ten years must be on a date subsequent to the commencement of the Maharashtra Co - operative Societies (Amendment) Act, 1969. Clause (b) of the said explanation to sub - section (5) has also provident that if any person resigns his office as a designated officer at any time within twelve months of the date on which the aggregate period of ten years would but for his resignation, have been completed, he shall be deemed to have completed the period of ten years on his resignation. Therefore, explanation (b) to sub - section (5) seeks to prevent evasion of the bar under the main part of sub - section (1) by taking into reckoning, the period of office held by a designated office who resigns within twelve months of the day on which he was to complete ten years in aggregate. It maybe also noted that the disqualification under sub - section (5) of Section 73 - A would operate until a period" of one term of the Committee would elapse after completion of the aforesaid period of ten years. In other words, the disqualification under sub - section (5) is temporary and after expiry of one term, the person who was once disqualified under Section 73 - A (5) would again be qualified to be elected or appointed. In fact, such limitation of the period of disqualification i1s to ensure the" reasonableness of the provision.

       In the matter of such disqualification, Section 73 - A (5) has equally treated all designated officers of one Society. When the term of office of, disqualified officer varies from Society to Society (which are not covered by Section 73 - G), the Legislature has rightly mentioned in Section 73 - A (5) period of one term of the Committee instead of specifying any fixed number of years. If the Legislature had instead fixed a certain length of time, the same might have caused anomaly as to the date on which a person who was once disqualified under Section 73 - A (5) would again acquire qualification to be a designated officer. It was perfectly legitimate to provide ill Section 73 - A (5) that on the expiry of one term, the disqualification would end.

       Section 73 - A cannot be struck down as suffering from vices of under inclusive legislation.

       There were two main considerations which justified an under inclusive classification: (1) administrative necessity and (2) the Legislature may not fully convinced that a particular policy which it adopts would be fully successful or wise.

       In order to curb the vice, of vested interests in the Co - operative Societies" the Legislature has thought fit to include some of the officers of the specified, Co - operative Societies described as designated officers. The State has at the first instance tried to disqualify those officers who are more prone to perpetuate their offices and to acquire vested interest. Nothing prevents the Legislature from enlarging the scope of Section 73 - A by including other officers who may also exhibit the same tendency to acquire vested interests in the Co - operative Societies.