PATNA HIGH COURT
S.Shamsul Hasan and Phani Bhushan Prasad JJ.
Vijay Kumar Mishra And Brij Bihar Kuwar
Versus
State Of Bihar
Civil Writ Jurisdiction Case No. 5614 of 1986 ;
Decided On : FEBRUARY 24, 1988
None
Fact of the Case:
The Bihar State Housing Co-operative Federation Limited (Federation) was superseded by the State Government on the basis of a report submitted by the Registrar, alleging mismanagement of the Federation's affairs. The Federation and some of its members challenged the supersession order and the amendment of the Federation's bye-laws, which was done by the Registrar under Section 26 of the Bihar and Orissa Co-operative Societies Act, 1935 (the Act).
Finding of the Court:
The court held that the supersession order was invalid because the grounds cited by the State Government were not supported by the evidence and were not covered by the provisions of Section 41(6) of the Act. The court also held that the amendment of the bye-laws was invalid because the Registrar did not follow the proper procedure prescribed under the Act and the Rules.
Issues: 1. Whether the supersession order was valid. 2. Whether the amendment of the bye-laws was valid.
Ratio Decidendi: 1. The court held that the supersession order was invalid because: - The grounds cited by the State Government were not supported by the evidence. - The grounds were not covered by the provisions of Section 41(6) of the Act, which empowers the State Government to dissolve the managing committee of a co-operative society in certain circumstances. 2. The court held that the amendment of the bye-laws was invalid because: - The Registrar did not follow the proper procedure prescribed under the Act and the Rules. - The Registrar did not give the Federation an opportunity to consider the proposed amendments in a general meeting, as required by Section 25 of the Act.
Final Decision: The court allowed both writ petitions and quashed the supersession order and the amendment of the bye-laws.
S.Shamsul Hasan, J.
1. These two applications under Articles 226 and 227 of the Constitution of India, though of different huge, have their colour now mixed on the forensic canvass because to some extent one affects the other. Both these applications arise out of governmental action in the working of the Bihar State Housing Co-operative Federation Limited (hereinafter referred to as the Federation) of which petitioner in C.W.J.C. No. 5614 of 1986 is the Chairman and petitioners in C.W.J.C. No. 461 of 1986 are the members. This Federation is a society within the meaning of Sec.2(b) of the Bihar and Orissa Co-operative Societies Act, 1935 (hereinafter referred to as the Act) and in common co-operative parlance is known as an apex society and in an affiliating society within the meaning of Rule 2(ii) of the Bihar Co-operative Societies Rules, 1959 (hereinafter referred to as the Rules) having some societies as its members which come within the definition of Sec.2(ggg) of the Act and are primary societies. According to Clause 30 of the Bye laws of the Federation, each affiliated or primary society is represented by a single nominee of the society known as delegate which constitute the General Body of the Federation.
2. Broadly speaking, the object of the Federation is to assist in the development of house building activities through primary co-operative societies by grant of loans or by its own construction. Basically, therefore, the activities of the Federation is promotional. A detailed description of the objective of the Federation has been set out in Clause 3 of the bye-laws.
3. It is now beneficial to describe the assailed Annexures. In the former application (C.W.J.C. No. 5614 of 1986) Annexure 13 is impugned which is a report of the Registrar (Respondent No. 5) sent to the Government and the penetrating affect of Annexure 13 caused the birth of Annexure 14, a notification by which the Federation has been superseded. In the latter writ application (C.W.J.C. No. 461 of 1986). Annexure 6 is assailed which is the letter of the Registrar (Respondent No. 3 in C.W. J.C. No. 461 of 1986) certifying the compulsory amendment to the bye-laws of the Federation purported to have been made under Sec.25 of the Act and Annexure 9 of C.W.J.C. No. 461 of 1987 and Annexure 19/A of C.W.J.C. No. 5614 of 1986 are the orders of the appellate authority, the Chief Minister, passed in an appeal preferred by the petitioner against Annexure 6. (
4. The events that led to the impugned action may now be chronologically stated. By Annexure 4 of C.W.J.C. No. 5614 of 1986, a letter dated 28.10.1985 issued by the Managing Director of the Federation to the Registrar, 15.11.1986 was the date fixed for the annual general meeting of the Federation. A copy of the agenda of the meeting was also enclosed with this letter (Annexure 4) in which the election of the office bearer was on the card as item Nos. 5 and 6. On 13.11.1986 by Annexure 6 (C.W.J.C. No. 5614 of 1986) communication was received from the Registrar suggesting the amendments to the bye-laws and by Annexure 5, it was directed that item Nos. 5 and 6 of the agenda, that is, election of the office bearer of the Federation be postponed till the amendments are duly approved by the General Body. On 14.11.1986, the amendment to the bye-laws was approved by the Board of Directors in fanatic exercise of the power and thereafter communicated to the Registrar and the amendment was registered by the Registrar all on the same day. 4.12.1986 was the date fixed by the Registrar in his communication dated 13,11.1986 (Annexure 6 of C.W.J.C. No. 5614 of 1986) to hold a special general meeting for the purpose of considering the amendment. On 29.11.1986, a report was sent to the Government (Annexure 13 of C.W.J.C. No. 5614 of 1986) and then the impugned notification as contained in Annexure 14 to supersede the Federation was issued.
5. Another set of relevant dates are as follows :-
On 25.12.1983 (vide Annexure 2
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