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2022 Supreme(Bom) 1566

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
SANDEEP K. SHINDE, J.
Kusum Ramesh Agarwal and Others – Petitioners
Versus
The Hon’ble State Minister for Co-operation, Department of Co-operation – Respondent
Writ Petition No. 7731 of 2022, Interim Application No. 18400 of 2022
Decided On : 19-10-2022

Advocates:
Advocate Appeared:
For the Petitioners: Subhash Jha, Manshi Jain, Usha Tiwari.
For the Respondents: V.S. Nimbalkar, Surel Shah, Atul Thakkar, Pratibha Mehta.

The main legal point established in the judgment is the mandatory requirement of consultation with the Federal Society before removing a member from the committee of a co-operative society under Section 78A(1)(b) of the Maharashtra Co-operative Societies Act, 1960.

Headnote:

REMOVAL - CO-OPERATIVE SOCIETY - Maharashtra Co-operative Societies Act, 1960, Section 78A(1)(b) - Summary of Acts and Sections: The court discussed the provisions of Section 78A(1) of the Maharashtra Co-operative Societies Act, 1960, and the requirement of consultation with the Federal Society before removing a member from the committee of the society. The court highlighted the mandatory nature of consultation and the lack of compliance with the consultation process in the present case.

Fact of the Case:

The petitioners, office bearers of a co-operative society, were removed from the committee by the Deputy Registrar under Section 78A(1)(b) of the Maharashtra Co-operative Societies Act, 1960. The Divisional Joint Registrar and the Hon’ble Minister confirmed the removal. The petitioners approached the court challenging the removal and disqualification from contesting elections.

Finding of the Court:

The court found that the removal of the petitioners was illegal due to the lack of consultation with the Federal Society, which is mandatory under Section 78A(1)(b) of the Act. The court quashed the order disqualifying the petitioners from being re-elected and directed the appointment of a new committee to manage the affairs of the society until the election.

Issues: The main issue was the legality of the removal of the petitioners from the committee of the co-operative society and their disqualification from contesting elections, based on the provisions of Section 78A(1)(b) of the Maharashtra Co-operative Societies Act, 1960.

Ratio Decidendi: The court held that consultation with the Federal Society is a prerequisite before removing a member from the committee of a co-operative society under Section 78A(1)(b) of the Act. The lack of consultation rendered the removal and disqualification orders illegal.

Final Decision: The petition was partly allowed, and the court quashed the order disqualifying the petitioners from being re-elected, re-co-opted, or re-nominated as members of any committee of the society. The court directed the appointment of a new committee to manage the affairs of the society until the election.

JUDGMENT :

SANDEEP K. SHINDE, J.

1. Rule. Rule made returnable forthwith. With consent of the learned counsel for the Parties, Petition is taken up for final hearing.

2. Petitioners were office bearers of Poonam Chambers, B Wing, Commercial Premises Co-operative Society Limited (‘Society’ for short). The Deputy Registrar, Co-operative Societies-Respondent No. 3, in exercise of the powers under Section 78A(1)(b), of the Maharashtra Co-operative Societies Act, 1960 (‘Act’ for short) removed the petitioners as members of the committee of the society and held them not be eligible to be re-elected, re-co-opted or re-nominated, as member of any committee of the society till expiry of the period till next term of the committee. Simultaneously, Deputy Registrar appointed Shri Ananda Patil, Authorised Officer to administer the affairs of the said Society. Later, on 11th January, 2022, committee of Shri Chirag Shah (Respondent No. 6), Shri Mahavir Murarka (Respondent No. 7) and Mr. Anand Patil (Authorised Officer) Respondent No. 5, was constituted to manage the affairs of society.

3. In Appeal under Section 152 of the Act, the Divisional Joint Registrar, vide order dated 2nd June, 2022 and in Revision, Hon’ble Minister vide order dated 21st June, 2022 confirmed the order dated 11th January, 2022 passed by the Deputy Registrar, Co-operative Societies. Feeling aggrieved by the said orders, petitioners have approached this Court in its supervisory jurisdiction.

4. It appears from the impugned order that Petitioners as Committee Members, refused to discharge the functions of the Society, besides violating the provisions of the Act, bye-laws and rules. Thus, after following due procedure, petitioners were removed from committee of the society. It is not in dispute that tenure of the petitioners as members of the committee has come to an end on. As such, election of the society is due.

5. Mr. Zha, learned counsel for the petitioners, would submit that besides giving reasonable opportunity of being heard, consultation with the federal society, is mandatory before superseding the committee or removal of member of the committee. Mr. Zha submitted that in terms of second proviso to Sub-Section (1) of Section 78A, the Deputy Registrar could not have proceeded to remove the petitioners, from the committee within 45 days, from the date of seeking opinion of the Federal Society. Mr. Zha submitted, settled law is consultation with the Federal Society is mandatory, however, in the case at hand, there was no consultation at all, leave aside effective consultation. In support of this contention, Mr. Zha has invited my attention to the letter dated 13th February, 2022 addressed by Federation to the Deputy Registrar. This letter conveys that Federation had received only a copy of show-cause and no other documents, for submitting its opinion. Therefore, argued by Mr. Zha, that in absence of, consultation with the Federal Society, order dated 11th January, 2022 passed by the Deputy Registrar in exercise of the powers under Section 78A(1) (b) and further disqualifying the petitioners from contesting the elections for period of next one term was illegal. Mr. Zha relied on the decision in the case of Hemchandra Madhukar Shaligram and Others vs. Sonal Sanjeev Shetty and Others, 2019 SCC Online Bom. 1877, Vinod Ghanshay Meshram and Others vs. Hon’ble Minister for State and Others, 2014 SCC Online Bom. 1676. In these decisions, it was held that requirement of consultation under Section (1) of Section 78 is mandatory and in order to demonstrate, there was effective consultation with the Federal Society, record must indicate that there was meeting of minds of the management committee of Federal society among themselves and the consulting committee, culminating into passing of the resolution either one way or the other. It is, therefore, argued that in absence of consultation, impugned orders are bad in law and thus, be quashed and set aside.

6. Refuting petitioners’ submis

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