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2006 Supreme(Guj) 747

Gujarat High Court
Judgename :D.A.Mehta
PRAVINBHAI MOHANBHAI RAIYANI - Appellant
Versus
STATE OF GUJARAT - Respondent
Special Civil Application 12583 Of 2006
Decided On : 11/27/2006

Advocates Appeared: ARCHNA RAWAL, HARIN P.RAVAL, SANDHYA NATANI, SUNIT SHAH

Headnote:Point in Issue :

       Whether issuance of show-cause notice in absence of any material to link the present Managing Committee with alleged defaults sustainable?

       Head Note :

       Gujarat Co-operative Societies Act, 1961 (Guj. Act 10 of 1962) - Sections 81(1)(a), 81(6) and 85 - Notices - Show-cause - Dissolution of Managing Committee - And appointment of Administrator - Sustainability - Finding as to - On a plain reading of three charges levelled against the Managing Committee it becomes clear that the present Managing Committee which has come into existence only on 05.07.2006 was never involved in any of the decision making process for which the charges are levelled in the impugned notice - Notice is also not based on failure to take remedial measures under the Act as alleged on behalf of respondent - In the case any material to link the present Managing Committee with the defaults for which it is charged with is singularly missing - Hence in absence of the jurisdictional facts the action of Respondent No. 2 Registrar in issuing impugned notice is bad and liable to be quashed.

       Held :

       On a plain perusal of the aforesaid three charges, it becomes apparent that the present Managing Committee which has come into existence only on 05.07.2006 was never involved in any of the decision making process, for which the charges are levelled in the impugned Notice. Nor is the impugned notice based on failure to take remedial measures under Section 85 of the Act as pleaded by the learned AGP. Therefore, even if one proceeds on the footing that the charges have some prima-facie basis, there is no material to link the present Managing Committee for the so-called defaults. It is well settled that the authority in exercise of its jurisdiction has to have some material in its possession so as to prima facie establish existence of jurisdictional facts which would operate as a live link between the charges levelled and the person charged with such charges. In other words, even for the purposes of arriving at a prima facie opinion that the persons charged with have committed certain defaults, there must be some material in existence with the authority before the authority can exercise such jurisdiction. In the present case, such material to link the present Managing Committee with the defaults for which it is charged with is singularly missing. Hence, in absence of the jurisdictional facts the action of Respondent No. 2-Registrar in issuing impugned show-cause notice is bad in law being without jurisdiction. [Para 9]

       Law Laid Down :

       Even for the purpose of arriving at a prima facie opinion that the persons charged with have committed certain defaults there must be some material in existence with the authority before the authority can exercise such jurisdiction.

       Conclusion :

       In absence of the jurisdictional facts the action of Respondent No. 2 Registrar in issuing impugned notice is bad in law - Hence not sustainable.

       Cases Referred :

       Registrar of Co-operative Societies, Madras & Ors. vs. P.S. Rajagopal Naidu & Ors., AIR 1970 Madras 212;; Whirlpool Corporation vs. Registrar of Trade Marks, Mumbai, 1998 (8) SCC 1;; Calcutta Discount Co. Ltd. vs. Income-Tax Officer, Companies District I, Calcutta & Anr., AIR 1961 SC 372.

       Decided in Favour of :

       Petitioner

       Petition Allowed

D. A. MEHTA, J.

( 1 ) RULE. The learned AGP is directed to waive service. The petition is taken up for final hearing and disposal today.

( 2 ) THIS petition challenges Notice dated 17. 06. 2006 (Annexure-E) whereunder respondent No. 2- Registrar, Co-operative societies, has in exercise of powers under section 81 (l) (a) of the Gujarat Co-operative societies Act, 1961 (the Act) called upon the petitioners herein to show cause why the managing Committee should not be removed and an administrator appointed for the three defaults stated in the impugned show cause notice.

( 3 ) IT is an admitted fact that elections for the Managing Committee were declared on 29. 05. 2006, were held on 22. 06. 2006 and results declared on 24. 06. 2006. The newly constituted body came in to effect on 05. 07. 2006.

( 4 ) MR. S. N. SHELAT, learned senior advocate appearing on behalf of the petitioners submitted that each of the petitioners has been elected for the first time and on a bare perusal of the impugned show cause notice, the so called defaults for which the committee is to be removed pertain to a committee which was in existence in past and none of the petitioners are in any way responsible for the acts alleged in show cause notice. That merely because certain members of the newly constituted body are common with the members of the earlier managing Committee, the present Committee cannot be held liable for defaults, if any, of the Committee or Committees which existed in past. That once the Committee which is supposed to have committed the alleged default is not in existence the entire exercise of removing the present Committee, which has come into existence at a subsequent point of time, is a futile exercise and cannot be permitted. That as the challenge is to the jurisdiction of powers by which the Registrar can initiate action under Section 81 (l) (a) of the Act, the Court is within its right to entertain the petition even at the show cause notice stage and should do so to prevent long drawn out litigation and unwarranted harassment to the petitioners as laid down by the Apex Court in the case of CALCUTTA DISCOUNT CO. LTD. V/s. INCOME-TAX OFFICER, COMPANIES district I, CALCUTTA AND ANOTHER reported IN AIR 1961 SC 372, which has been since reiterated by the Apex Court in the case of WHIRLPOOL CORPORATION V/ s. REGISTRAR OF TRADE MARKS, mumbai REPORTED IN (1998) 8 SCC 1. He, therefore, urged that impugned notice be quashed and set aside in the facts of the case.

( 5 ) IN support of the submissions was made, he has placed reliance on unreported decision of this Court rendered in case of zaroli VIBHAG JUNGLE KAMDAR sahkari MANDALI LTD. , V/s. H. M. JOSHI and ORS. IN SCA NO. 1551 and 1552 OF 1967 dated 17. 06. 1971. He has also referred to the dictionary meaning of the term action as referred to in Sub-Section 6 of Section 81 of the Act. One more contention was based on the concept of bias, more particularly, departmental bias. However, for the reasons stated hereinafter, it is not necessary to deal with the contentions based on provisions of section 81 (6) of the Act and departmental bias.

( 6 ) THE learned AGP appearing on behalf of the respondents has placed reliance on affidavit-in-reply filed in a cognate matter being Special Civil Application No. 12589 of 2006. The principal emphasis is on the fact that the petitions need not be entertained as the petitioners have approached the Court at the show cause notice stage and whatever the petitioners would like to state, can be considered by the respondent-authorities on filing of the appropriate reply. She has also placed reliance on the decision in case of the JOINT REGISTRAR OF CO-OP. SOC. , madras AND ORS. V/s. P. S. RAJAGOPAL naidu AND OTHERS REPORTED IN AIR 1970 MADRAS 212 to submit that the registrar is not divested of his powers merely because some members of the managing Committee are different vis-a-vis the Managing Committee which was in existence at the point of time when the default
















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