The duty of the Registrar to ensure compliance with the Act and Rules, and the right to be heard before cancellation of the amendment.

A.V. Ramakrishna Pillai, J.

Ext. P3 issued by the 2nd respondent, by which the 2nd respondent had directed the 3rd respondent to cancel Ext. P2 amendment contained in Clause 37b(v)(ii) in the bye-laws of the petitioner society, is under challenge in this writ petition. The petitioner is an Employees' Co-operative Society functioning with the area of operation as Meenachil taluk. It consists of more than 23,000 members falling under 4 classes, viz., A, B, C and D. A class members are employees working under various Co-operative Societies in the same taluk. B class members are employees working under Government, Semi-Governmental organizations, Government approved corporations and boards.

2. The petitioner alleges that by the amendment of the bye-law and insertion of Clause 37b(v)(ii), the facilities provided to A class members were also granted to B class members. The petitioner further alleges the amendment was approved by the 3rd respondent as per Ext. P2 in exercise of powers of the Registrar conferred upon the 3rd respondent.

3. On a petition filed by the 1st respondent society before the 2nd respondent aggrieved by the insertion of Clause 37b(v)(ii) in the bye-law of the petitioner society, the 2nd respondent as per Ext. P2 directed the 3rd respondent to cancel the amendment contained in the aforesaid clause. The petitioner challenges the impugned order for the reason that the petitioner society was not afforded an opportunity of being heard for the reason that only an appeal would lie to the Government as provided under Section 83 of the Kerala Co-operative Societies Act against Ext. P2 amendment. It is with this background, the petitioner has come up before this Court.

4. The 1st respondent society in the detailed counter-affidavit contended that the said society was formed in the year 1973 and was affiliated to the Kerala State Circle Co-operative Union. The employees of the society are aided school teachers working within the area of operation of the society viz., Panchayats of Ramapuram, Kadanad, Melukavu and Marangattuppally, within the Meenachil taluk. According to the 1st respondent, there are two types of membership in the society, viz., A class membership which is given to all the aided school teachers and associate membership for persons other than aided school teachers. The share subscription in respect of A class member is Rs. 100/- and for the Associate members it is Rs. 10/-.

5. It was further contended that Ext. P3 is only a communication addressed to the Joint Registrar, who is the 3rd respondent, instructing him to take necessary steps for repudiation of the amendment introduced to the bye-law of the petitioner society, viz., Clause 37b(v)(ii). It was pointed out that the functioning of both the societies do overlap side by side with the area of operation and by virtue of the proposed amendment, the petitioner intended to canvas business by weaning away substantial number of members of the 1st respondent bank who would by all means take advantage of the proposed amendment, which does not insist for payment of dividend proportionate to their share in the society.

6. They would further contend that it is the duty of the Registrar to satisfy himself under Section 7 of the Act that the proposed bye-laws are not contrary to the provisions of the Act and Rules. According to them Section 7 read with Rule 5 of the Rules mandates that bye-laws cannot be registered if it is against the provisions of the Act and Rules. Therefore, they maintained the stand that the Registrar is perfectly competent to issue Ext. P3.

7. In the counter-affidavit filed by the 3rd respondent, they contended as follows:

The petitioner is a co-operative society registered under the Kerala Co-operative Societies Act and Rules. The society consists of A, B, C and D class members. A class members are the employees employed in the Co-operative Societies in the are of operation of the petitioner society. B class members consist of permanent em