2025 Supreme(Bom) 1313

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
AMIT BORKAR, J.
Harish Arora - Appellant
Versus
The Deputy Registrar of Cooperative Societies - Respondent
Writ Petition No. 3433 of 2025
Decided On : 09-06-2025

Government resolutions under the Maharashtra Cooperative Societies Act are directory, not mandatory, and disqualification requires valid procedural compliance and adherence to principles of natural justice.

Headnote:(A) Maharashtra Cooperative Societies Act, 1960 - Sections 77A, 79A(3) - Writ petition challenging disqualification of managing committee members of cooperative society for violations of government guidelines - Court held that government resolutions are directory and non-compliance does not warrant disqualification - Natural justice principles breached as some members were not given notice - Court quashed disqualification order and appointment of Administrator. (Paras 1, 60, 64, 105)

(B) Natural Justice - Rule of Audi Alteram Partem - Fair hearing is a fundamental principle, especially involving penalties or disqualifications. (Paras 60, 64)

(C) Binding Precedents - Authorities must follow judicial interpretations of law; failure amounts to legal mala fides. (Paras 49, 105)

(D) Statutory Powers - Authorities must observe procedural safeguards while exercising statutory powers to prevent arbitrary actions. (Paras 98, 105)

Facts of the case:
Petitioners, members of the committee, were disqualified for six years under Section 79A(3) of the MCS Act for alleged violation of redevelopment guidelines, and an Administrator was appointed. They contended that principles of natural justice were violated as some members did not receive notices; they also argued the resolutions were directory and not mandatory. (Paras 1, 11, 60, 68)

Findings of Court:
Orders disqualifying petitioners and appointing Administrator were quashed due to violation of natural justice, failure to follow binding precedents, and inappropriate exercise of statutory powers. (Paras 104, 105)

Issues: 1) Whether disqualification under Section 79A was sustainable given the nature of the Government Resolution? 2) Did the proceedings violate principles of natural justice? 3) Was the appointment of Administrator under Section 77A justified? (Paras 32, 33, 105)

Ratio Decidendi: The Court held that the government resolution is directory; procedural fairness must be adhered to, and judicial precedents are binding on administrative authorities. Failure to follow these principles vitiates the authority's actions. (Paras 104, 105)

Result: Writ petition allowed, orders quashed and set aside.