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2022 Supreme(Bom) 1627

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
Sandeep K. Shinde, J.
Shri Yuvraj Datajirao Patil - Petitioner
Versus
District Deputy Registrar Co-op. Societies, Kolhapur & Ors. – Respondents
Writ Petition No.1516 of 2019
Decided On : 17-11-2022

Advocates:
Advocate Appeared:
For the Petitioner:Mr. Y.S.Jahagirdar, Senior Advocate with Mr. S.S.Shah
For the Respondent: Mrs. M.S.Srivastava, AGP, Mr. Prashant Bhavake with Mr. Utkarsh Desai

The main legal point established in the judgment is that disqualification under Section 73CA of the Maharashtra Co-operative Societies Act, 1960, operates independently of other provisions, and the cessation of membership is automatic upon incurring disqualification.

Headnote:

Disqualification - Membership Cessation - Maharashtra Co-operative Societies Act, 1960 - Section 73CA(1)(i)(b), Section 73CA(2), Section 73CA(3)

Fact of the Case:

The petitioner was held ineligible to be re-elected, re-co-opted, or re-nominated as a member of the Managing Committee of Shetkari Sahakari Sangh, Respondent No.4, for a term of five years due to defaulting loan installments. The petitioner contested the disqualification and cessation of membership.

Finding of the Court:

The court found that the petitioner's disqualification for defaulting on loan installments led to the cessation of membership as per Section 73CA(2) and (3) of the Maharashtra Co-operative Societies Act, 1960. The court rejected the petitioner's argument that resignation from the committee resulted in cessation, emphasizing the independent operation of Section 73CA in relation to disqualification and membership cessation.

Issues: 1. Whether payment of dues following disqualification would retrieve the disqualification. 2. Whether resignation from the committee results in cessation of membership. 3. Whether cessation of membership under Section 73CA(2) is automatic or requires action under Section 78A of the MCS Act.

Ratio Decidendi: The court held that the disqualification incurred by defaulting on loan installments cannot be remedied by paying dues and that resignation from the committee does not result in cessation of membership as per Section 73CA. The court emphasized the independent operation of Section 73CA in relation to disqualification and membership cessation.

Final Decision: The petition was dismissed, and the rule was discharged. The court upheld the disqualification and cessation of membership as per Section 73CA(2) and (3) of the Maharashtra Co-operative Societies Act, 1960.

JUDGMENT :

Rule. Rule made returnable forthwith. With consent of the parties, petition is taken up for final hearing.

2. By impugned orders, Petitioner was held ineligible, to be re-elected, re-co-opted or re-nominated as a, member of Managing Committee of Shetkari Sahakari Sangh, Respondent No.4, for a term of five years. Thus, this Petition under Article 227 of the Constitution of India.

3. In brief, facts of the case are like this;

In the year, 2015, Petitioner was elected as member of Board of Directors, of Shetkari Sahakari Sangh (Respondent No.4). Though Respondent No.2 had contested the election, he was defeated. On 5th May, 2017, Respondent No.2 moved an application to seek disqualification of the Petitioner, on the ground that the Petitioner and his son had obtained loan of Rs.15 Lakhs on 27th March, 2012 from Kolhapur District Cooperative Agriculture and Rural Development Bank but defaulted installments of the loan. He produced recovery certificate dated 4th May, 2017, issued under Section 137(1) of the Maharashtra Co-operative Societies Act, 1960 (‘MCS Act’ for short) against the petitioner and his son. Whereupon, the District Deputy Registrar issued show-cause notice on 11th May, 2017 purportedly under the provisions of the Section 73CA(1)(i) (b) of the MCS Act, by which petitioner was called upon to show cause as to why he should not be declared as defaulter, within the meaning of Section 73CA(A-1)(1)(i) of the MCS Act. Petitioner denied the allegations of ‘default’, and contended that, in terms of compromise decree drawn in Regular Civil Suit No.103 of 2017 on 12th June, 2017, he could not be held ‘defaulter’.

4. The District Deputy Registrar, vide order dated 29th June, 2017, held that the petitioner, being ‘defaulter’, has incurred disqualification in terms of the provisions of Section 73CA(A1)(1)(i) of the MCS Act and further held that he ceased to be member of the committee and further ordered that, in view of the disqualification incurred, Petitioner shall not be eligible to be re-elected, re-co-opted or being re-nominated as member of the committee till expiry of the period of next term of five years of the committee from the date on which he ceased to be a member of the committee. In revision, Divisional Joint Registrar, confirmed the order passed by the District Deputy Registrar and dismissed the Revision vide order dated 19th July, 2017.

5. Being aggrieved and dissatisfied by the said orders, petitioner filed Writ Petition No.843 of 2017.

6. Pending Writ Petition, Petitioner without prejudice to his rights and contentions, paid all dues, which were allegedly defaulted by him. In view thereof, on 21st March, 2018, this Court set aside the orders passed by the District Deputy Registrar and Divisional Joint Registrar and restored the proceedings to file of District Deputy Registrar with direction to pass order afresh in accordance with law.

7. Pursuant thereto, District Deputy Registrar issued notice to the petitioner on 11th April, 2018. Pending proceedings, on 29th August, 2018, Petitioner tendered resignation of his membership of the Board of Sangh. Taking note of the resignation, District Deputy Registrar vide order dated 30th August, 2018 held that the proceedings in pursuance to the notice dated 11th May, 2017 disqualifying the petitioner under Section 73(CA)(1)(i)(b) were rendered infructuous but held that, in terms of Section 73CA(3) of the MCS Act, petitioner is not eligible to be re-elected, re-co-opted or re-nominated as member of the committee from the date on which he ceased to be member of the committee.

8. Being aggrieved by the order dated 30th August, 2018, Petitioner filed revision. Divisional Joint Registrar dismissed the revision and confirmed the order dated 30th August, 2018 passed by the District Deputy Registrar.

9. Feeling aggrieved by the order passed by the Divisional Joint Registrar, this Petition is preferred under Article 227 of the Constitution of India.

10. Heard Mr. Jahagirdar, the lea

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