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2023 Supreme(Bom) 184

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
Arun R.Pedneker, J.
Sudam Ganpat Kothambire - Appellant
Versus
State Of Maharashtra - Respondent
Writ Petition No. 5760 of 2022
Decided On : 08-02-2023

Advocates:
Counsel for Appearing Parties
Ajinkya S.Kale, Advocate, N.T.Bagat, Advocate, V.D.Hon, Advocate, A.V.Hon, Advocate

The main legal point established is that a cooperative society cannot refuse admission to qualified individuals, and any dispute regarding membership can only be remedied by filing a dispute under Sec. 91 of the Maharashtra Co-operative Societies Act, 1960.

Headnote:

Membership - Cooperative Society - Maharashtra Co-operative Societies Act, 1960, Sec. 23, 79A

Fact of the Case:

The petitioners challenged the induction of 1405 members by the respondent Cooperative Society, alleging illegalities and lack of due procedure. The Commissioner and Registrar, Cooperative societies, Pune declared the membership of 1392 members as legal and valid, and membership of 13 members as invalid. The petitioners sought to challenge this decision.

Finding of the Court:

The court held that the induction of 1405 members on a single day was not prohibited by law, and the society was obliged to grant membership to all qualified applicants under Sec. 23 of the Maharashtra Co-operative Societies Act, 1960. The court also found that the proceedings under Sec. 79A were misconceived, and any dispute regarding membership could be remedied by filing a dispute under Sec. 91 of the Act before the Cooperative Court.

Issues: The issues revolved around the legality of the induction of 1405 members, the application of Sec. 23 and 79A of the Maharashtra Co-operative Societies Act, 1960, and the appropriate remedy for challenging the membership resolution.

Ratio Decidendi: The court emphasized that the society could not refuse admission to qualified individuals, and the induction of members on a single day was not prohibited by law. It also clarified that any dispute regarding membership could only be remedied by filing a dispute under Sec. 91 of the Act before the Cooperative Court.

Final Decision: The court dismissed the writ petition, directing the petitioners to pursue the remedy before the Cooperative Court under Sec. 91 of the Maharashtra Co-operative Societies Act, 1960.

JUDGMENT

1. Rule. Rule made returnable forthwith. With the consent of learned advocates for the respective parties, heard finally.

2. By the present writ petition, the petitioners are challenging the impugned judgment and order dtd. 11/5/2022 passed by the Hon'ble Minister, Co-operation, Textile and Marketing Department of State of Maharashtra, thereby dismissing the Revision being REV-2021/Pra.Kra.348/15-S. The petitioners also pray for quashing the letter/communication dtd. 24/12/2020 issued by the Commissioner, Cooperative and Registrar Co-operative, Societies, Maharashtra State thereby declaring that membership of 1392 newly added members is legal and valid out of 1405 newly added members.

3. Brief facts, leading to the filing of the present writ petition can be summarised as under :-

    The petitioner Nos. 1 and 2 are the Directors, the petitioner Nos. 3 and 4 are the co-opted Directors and the petitioner No. 5 is the member and account holder of the respondent No. 5 - Parner Taluka Sahakari Bank Ltd. The respondent No. 5 is a Co-operative Society duly registered under the provisions of Maharashtra Co-operative Societies Act, 1960 and is carrying the business of banking.

    4. It is the case of the petitioners that respondent No. 5/Bank illegally inducted 1405 members without following due procedure on 26/7/2019. The newly added members are inducted as they being favourable to the elected body and only with the purpose of ensuing election. The petitioners filed several complaints/representations before respondent No. 2 - The Commissioner for Cooperation and Registrar, Co-operative Societies, Ahemednager. Thereafter, the petitioners approached the High Court by filing Writ Petition No. 890/2020, seeking directions against the respondent No. 2 to decide the complaints/representations dtd. 13/9/2019 and 27/11/2019 of the petitioners. Statement was made before the High Court that the complaints/representations filed by petitioners would be considered and decided within three months. In view of the same, the writ petition came to be disposed of with direction to decide the complaints/representations of the petitioners within a period of three months.

    5. Accordingly respondent No. 2 called inquiry report from respondent No. 3 - District Deputy Registrar, Co-operative Societies, Ahmednagar and respondent No. 4 - Assistant Registrar, Co-operative Societies, Parner, Dist. Ahmednagar. The respondent No. 4 conducted inquiry and submitted an inquiry report to the respondent No. 3 on 7/7/2020. The respondent No. 4, in it's report submitted that there were near about 144 members, who have not signed the membership application form nor completed K.Y.C. procedure. The respondent No. 4, after considering all these illegalities, recommended action under sec. 79A of the Maharashtra Co-operative Societies Act, 1960 (hereinafter referred to as 'MCS Act' for short) against the respondent No. 5/Bank. Thereafter the respondent No. 3 forwarded the inquiry report of respondent No. 4 to the respondent No. 2, pointing out the illegalities committed by the respondent No. 5/Bank.

    6. The respondent No. 2 called respondent No. 5/Bank to produce entire record in respect of membership of newly inducted 1405 members on 24/8/2020. The respondent No. 5/Bank admitted that documentation of only 13 newly inducted members was not proper or complete and as such, respondent No. 5/Bank took action against 13 members and informed the same to respondent No. 2 and also produced the entire record before the respondent No. 2. The respondent No. 2, on perusal of the record, by communication dtd. 24/12/2020 declared that membership of 1392 is legal and valid and that membership of only 13 members was invalid. The petitioners, therefore, challenged the order/communication dtd. 24/12/2020 of respondent No. 2 before the Hon'ble Minister and the Hon'ble Minister, by the impugned order dtd. 11/5/2022 dismissed the revision petition filed against communication/order dtd. 24/12/2020 pa

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