2019 Supreme(Bom) 2176

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
A.A. Sayed, M.S. Karnik, JJ.
Chandrashekhar M Ghule Patil - Appellant
Versus
State Of Maharashtra & Ors. - Respondents
Writ Petition No. 4887 of 2018, 9550 of 2017, 9550 of 2017; Civil Application No. 2670 of 2017
Decided On : 02-05-2019

The Legislature has plenary powers of legislation within the field assigned to it, and subject to constitutional and judicial recognized restrictions, the Legislature can legislate prospectively as well as retrospectively. The retrospective law can take away even vested rights that may have been acquired under the existing law, subject however to the condition that the retrospective law must also conform to the dos and don'ts of the Constitution and must not contravene fundamental rights.

Headnote:

The 3rd and 4th provisos to Section 88(1) of the Maharashtra Co-operative Societies Act, 1960 (MCS Act) were inserted by the Maharashtra Co-operative Societies (Amendment) Act, 2017 (Amendment Act). The Petitioners, former Directors of the Maharashtra State Co-operative Bank, challenged the Amendment Act, arguing that the 4th proviso was ultra vires and unconstitutional as it revived lapsed proceedings and took away their vested rights. The Court held that the 4th proviso was expressly made retrospective in operation and the Government was empowered to extend the period of inquiry proceedings (subject to the conditions stipulated therein) which remained incomplete on account of expiry of 21/2 years as on the date of the commencement of the Amendment Act i.e. 26-04-2017.

Fact of the Case:

The Petitioners were former Directors of the Maharashtra State Co-operative Bank. The Respondent Bank is the Apex Co-operative Bank in the State of Maharashtra and it caters mainly to the need of agricultural sector. It is an Apex body for about 31 District Central Co-operative Banks in the State and also provides financial assistance to the said Banks. On 07.01.2013 an order was passed by the Commissioner for Co-operation and Registrar of Co-operative Societies (hereinafter referred to as "the Registrar") under Section 83 of the MCS Act appointing Additional Registrar Co-operative Societies, for conducting an inquiry with regard to the working and financial condition of the Respondent Bank for the period 2007-08 to 2010-11 and submit a Report. Upon the Report being submitted by the Additional Registrar, the Registrar passed an order on 22-05-2014 appointing the Respondent No.4 as Authorized Officer to conduct an inquiry under Section 88(1) of the MCS Act for the purposes of fixing responsibility for the monetary loss caused to the Respondent Bank by the delinquent office bearers (including the Petitioners herein).

Finding of the Court:

The Court held that the 4th proviso to Section 88(1) of the MCS Act was expressly made retrospective in operation and the Government was empowered to extend the period of inquiry proceedings (subject to the conditions stipulated therein) which remained incomplete on account of expiry of 21/2 years as on the date of the commencement of the Amendment Act i.e. 26-04-2017. The Court further held that the Legislature has plenary powers of legislation within the field assigned to it, and subject to constitutional and judicial recognized restrictions, the Legislature can legislate prospectively as well as retrospectively. The retrospective law can take away even vested rights that may have been acquired under the existing law, subject however to the condition that the retrospective law must also conform to the dos and don'ts of the Constitution and must not contravene fundamental rights.

Issues: 1. Whether the 4th proviso to Section 88(1) of the MCS Act was ultra vires and unconstitutional as it revived lapsed proceedings and took away the Petitioners' vested rights? 2. Whether the Legislature has plenary powers of legislation within the field assigned to it, and subject to constitutional and judicial recognized restrictions, the Legislature can legislate prospectively as well as retrospectively?

Ratio Decidendi: 1. The Court held that the 4th proviso to Section 88(1) of the MCS Act was expressly made retrospective in operation and the Government was empowered to extend the period of inquiry proceedings (subject to the conditions stipulated therein) which remained incomplete on account of expiry of 21/2 years as on the date of the commencement of the Amendment Act i.e. 26-04-2017. 2. The Court further held that the Legislature has plenary powers of legislation within the field assigned to it, and subject to constitutional and judicial recognized restrictions, the Legislature can legislate prospectively as well as retrospectively. The retrospective law can take away even vested rights that may have been acquired under the existing law, subject however to the condition that the retrospective law must also conform to the dos and don'ts of the Constitution and must not contravene fundamental rights.

Final Decision: The Petitions were dismissed.