Narayan s/o Gujabrao Bhoyar vs Yeotmal Zilla Parishad Karmachari Sahakari Path Sanstha Maryadit & Another And Rajendra Babarao Raut

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2009 Supreme(Bom) 1278

In the High Court of Bombay at Nagpur
THE HONOURABLE CHIEF JUSTICE MR. SWATANTER KUMAR, THE HONOURABLE MR. JUSTICE D.D. SINHA & THE HONOURABLE MR. JUSTICE P.B. VARALE
Narayan s/o Gujabrao Bhoyar – Appellant
Versus
Yeotmal Zilla Parishad Karmachari Sahakari Path Sanstha Maryadit & Another And Rajendra Babarao Raut - Respondent
Writ Petition No.1744 of 2009
Decided on : 25-09-2009

Advocates appeared:
For the Petitioner:S.D. Paliwal, with M.I. Dhatrak, Advocates.
For the Respondents:R1 & R2, S.V. Parkhi, Advocate. For the Intervenor:S.K. Tambde, Advocate.

Headnote:Natural Justice - Where a member of a mutual fund insurance society was purportedly expelled for suspicious conduct, the expulsion was absolutely void this rule is applicable to every Tribunal or body of persons invested with authority to adjudicate upon matters involving civil consequences to individuals - But before exercising this power it must be clear that the statutory procedure is not enough to achieve justice it would not frustrate the apparent purpose of the legislation. - The right to a fair hearing has been used by the Court as a base on which to build a kind of code of fair administrative procedure, comparable to ’due process of law’ under the Constitution of the United States. The Courts took their stand several centuries ago on the broad principle that bodies entrusted with legal power could not validly exercise it without first hearing the person who was going to suffer. This principle was applied very widely to administrative as well as to judicial acts, and to the acts of individual ministers and officials as well as to the acts of collective bodies such as justices and committees, etc. The principle was extended beyond the sphere of administrative law, to such bodies as societies and clubs. It was held to be an implied term of each member’s contract of membership that he could not be expelled without a fair hearing. In a case where a member of a mutual insurance society was purportedly expelled for suspicious conduct, but without a hearing, it was held that the expulsion was absolutely void, so that he was still a member in law, and this rule is not confined to the conduct of strictly legal tribunals, but is applicable to every tribunal or body of persons invested with authority to adjudicate upon matters involving civil consequences to individuals. Subsequently this doctrine found a fruitful field of application in protecting members and officers of trade unions from unfair expulsion or other penalties. It is also said that for a long time the Courts have, without objection from Parliament, supplemented procedure laid down in legislation where they have found that to be necessary for this purpose.
Natural Justice - Whosesoever the stock of a legislative act is mute or does not apply positive words associating to the grant of a chance of examining still the Court would read the conditions of natural justice into such conditions rather than announcing such condition ultra vires. - The above stated principles not only show the significance of adherence to the principle of audi alteram partem but even sufficiently indicate that the principles of natural justice had to be adhered to even if the provisions of a relevant statute are silent in that regard unless the statute specifically excludes the right of hearing or grant of opportunity and such interpretation is in conformity with the law. In other words, wherever the provision of a statute is silent or does not use positive words relating to the grant of an opportunity of hearing still the Court would read the provisions of natural justice into such provision rather than declaring such provision ultra vires.

Judgment :-

Swatanter Kumar, C.J.

1. In the year 2006, Narayan Gujabrao Bhoyar [hereinafter referred to as “the petitioner”] was elected as a Member of the Managing Committee of Yavatmal Zilla Parishad Karmachari Sahakari Sanstha [hereinafter referred as “the Society”] and also as a Secretary of the Respondent No.1Society.

2. The President of the Society resigned from his post allegedly on the ground that there were allegations of fraud while discharging his duties as President of the Respondent-Society.

3. According to the petitioner, the respondent no.2 called an illegal meeting and in that meeting, a decision is stated to have been taken that resignation of the President was rejected. A meeting of the Directors of the Society was also held and while passing Resolution No.5, it was resolved that the petitioner had not paid the amount of advance within thirty days and, thus, incurred the disqualification as per the provisions of the Maharashtra Co-operative Societies Act, 1960 [hereinafter referred to as “the Act”, for short].

4. In pursuance of this resolution, a letter was issued to the petitioner on 15th October, 2008, aggrieved by which, the petitioner raised a Dispute, being Dispute No. 611 of 2008, before the Co-operative Court, Amravati, and also filed an application for temporary injunction. The Dispute is still pending final adjudication before the Court of competent jurisdiction, but application for interim injunction was rejected by the said Court vide its order dated 17th November, 2008. The petitioner challenged the order dated 17th November, 2008 by filing an appeal under Section 97 of the Act before the Co-operative Appellate Court, Nagpur, being Appeal No. 2 of 2009, which also came to be dismissed vide order dated 26th February, 2009. The view taken by these two Forums was that the disqualification stated under Section 73FF of the Act operates automatically. A member of a Committee, who has failed to repay his advances within the specified period, would incur the disqualification and hence not entitled to continue as a member of the Committee.

5. The correctness and legality of the order of the Co-operative Appellate Court had been questioned by the petitioner by filing the present Writ Petition under Article 226 of the Constitution of India, by primarily contending that the provisions of Section 73FF of the Act do not operate automatically and order for removal in terms of Section 78 of the Act has to be passed by the Competent Authority, which is mandatory. In other words, the cessation of membership under Section 73FF (2) is not automatic. This was inter alia, but principally contended on behalf of the petitioner.

6. When the Writ Petition came up for hearing before learned Single Judge, the learned counsel appearing for the parties brought to the notice of Single Judge divergent views taken by different Division Benches of this Court. Seeing the legal differentiation between the Statement of Law and the decision of facts of these cases, the Single Judge felt the need for making a reference. Thus, the learned Judge, vide order dated 30th June, 2009 chose to make a reference to a Larger Bench, as the learned Single Judge found it difficult to follow the view expressed by the Courts. The order passed by learned Single Jude on 30th June, 2009 reads as follows:-

“Heard.

During the course of hearing, Shri Paliwal, the learned counsel for the petitioner relied on the decision rendered by this Court in the case of Keshaorao Narayana Patil Vs. District Deputy Registrar & ors., reported in 1987 Mh.L.J. 709, as also the decision in the case of Kerbaji Marotirao Shinde Vs. State of Mah. & ors., reported in 1988 Mh.L.J. 157, to canvass that Section 73 FF (2) of the Maharashtra Co-operative Societies Act, 1960, does not operate automatically so as to result in incurring disqualification under Section 73 FF (1) (i) [C] (i) and the person does not cease to be a member of the Managing Committee unless an action is tak

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