1. The competence of the State Government and the Registrar of Dairy Co-operatives to interfere with the decision taken by the Kerala Co-operative Milk Marketing Federation Limited, to increase the selling price of milk by `5/- per litre, with effect from 11.5.2011, is the issue raised in these Writ Petitions. They were therefore heard together and are being disposed of by this common judgment. W.P.(C) No.13648 of 2011 is treated as the main case and unless otherwise mentioned, the documents referred to are those produced therein.

2. The “Kerala Co-operative Milk Marketing Federation Limited”, otherwise known as “Milma”, is the petitioner in W.P.(C) No.13468 of 2011. It was registered as a Cooperative Society under the Kerala Co-operative Societies Act, 1969 (hereinafter referred to as the Act for short) on 21.02.1980. It is the apex society of the three Regional Co-operative Milk Producers’ Unions in the State of Kerala, which in turn have as their members, Primary Dairy Co-operative Societies. The three Regional Co-operative Milk Produces’ Unions in the State of Kerala are (1) The Thiruvananthapuram Regional Co-operative Milk Producers’ Union Ltd., (2) The Ernakulam Regional Cooperative Milk Producers’ Union Ltd., and (3) The Malabar Regional Co-operative Milk Producers’ Union Ltd. About 2800 Primary Dairy Co-operative Societies, which have approximately 8,00,000 dairy farmers as their members are affiliated to the three Regional Co-operative Milk Producers’ Unions. Petitioners 1 and 2 in W.P.(C) No.13483 of 2011 are two of such Primary Dairy Co-operative Societies registered under the Act and the other petitioners therein are dairy farmers who are members of the said societies. The petitioner in W.P.(C) No.16764 of 2011 is a dairy farmer and a member of yet another Primary Dairy Co-operative Society.

3. The administration, management and control of the Kerala Co-operative Milk Marketing Federation Limited (hereinafter referred to as the Federation for short) is vested in its Board of Directors constituted as per its bye-laws. The fundamental objects of the Federation are to carry out activities for promoting the production, procurement, processing and marketing of milk and milk products for the economic development of the farming community; development and expansion of such other allied activities as may be conducive for the promotion of the dairy industry; improvement and protection of which animals and the economic betterment of those engaged in milk production. The Federation was formed pursuant to a tripartite agreement entered into between the Government of Kerala, the National Dairy Development Board and the Indian Dairy Corporation on 27.4.1979, in implementation of a programme for dairy development known as Operation Flood II and it was registered on 21.2.1980. The Board of Directors of the Federation consists of the following members:

1. Chairman of the affiliated Unions enrolled as ordinary members;

2. Registrar of Dairy Co-operatives.

3. The Secretary to Government, Animal Husbandry and Dairy, Government of Kerala.

4. Representative from the Finance Department, Government of Kerala.

5. Two elected Directors to be nominated by each affiliated Union. However there shall be no Director nominated by from the District which is represented by the Chairman of the Union where the Union has only a Nominated Board. The nominee of the Regional Milk Unions shall be Presidents of the Anand Pattern Societies on the Board of the Unions.

6. One Nominee of National Dairy Development Board.

7. The Managing Director of the Federation.

4. In the year 2009, the Federation noticed that there was a drastic reduction in the procurement of milk by the affiliated Regional Co-operative Milk Producer’s Unions in the State due to dairy farmers giving up dairy farming mainly for the reason that it is uneconomic. The Board of Directors of the Federation that met on 16.11.2009 therefore decided to have a detailed study conducted