The appointment of a Managing Director by the Government, without the option of the Board of Directors to elect him, does not violate Article 19(1)(c) of the Constitution, which guarantees the right to form associations.

RAMAPRASADA RAO, C.J. :- This writ petition is filed by the President of the Peddanaickenpalayam Co-operative Agricultural Bank Ltd. After enumerating the various powers enjoyed by the Bank under the provisions of the Tamil Nadu Co-operative Societies Act, reference is made to the fact that the management and administration of the third respondent (Salem Cooperative Central Bank), of whom the petitioner is one of the share-holder members, vests in the general body of its members, and that the general body is empowered to constitute a Committee for the purpose of entrusting the management of the affairs of the Society to such nominees of theirs. As the Society has been registered under the provisions of the Tamil Nadu Co-operative Societies Act, it is a body corporate with power to hold property and do all things necessary for the purpose for which it was constituted. Reference is made to the general powers vested under Chapter VIII of the Act, in the Government in and by which the Government is enabled to issue directions to the Registrar to make an enquiry or to take appropriate proceedings under the Act, if, on audit or enquiry conducted by it, any acts of misfeasance and malfeasance are discovered. It is also stated that Section 72 of the Act empowers the Registrar to dissolve the Committee of Management and appoint a person or a Committee of his choice instead. After referring to the above and the preamble of the Act, the complainant is against the introduction of Chapter IX-B of the Act by the Tamil Nadu Co-operative Societies (Third Amendment) Act 1970. The grievance is that by G.O.Ms. No. 57 Cooperation dated 23-3-1973, the provisions of Chapter IX-B were made applicable to Central Co-operative Banks with effect from the date of the notification. Particular reference is made to Section 73-J of the Act and Rule 85-NA of the Rules which were introduced by reason of the induction of Chapter IX-B and the challenge is directly against the said two provisions on the ground that they are illegal and invalid and violate the rights guaranteed under Article 19(1)(c) of the Constitution.

2. So far as Section 73-J (which is the new section) is concerned, it is alleged that the appointment of the Managing director by the Government, without there being any option to the members of the Board of Directors to elect him, violates the provisions of Article 19(1)(c) of the Constitution. It is also stated that the composition of the Board of Directors of the Central Co-operative Society is changed by such compulsory induction of the Managing Director. The gravamen of the charge is that the members of the Society are compelled to act with the Managing Director and that the aforesaid alteration in the composition and the apprehension that the Managing Director would sway the Board, leads to the conclusion that it was an impact on the normal fundamental right of the share-holders to form an association under Article 19(1)(c) of the Constitution.

3. So far as Rule 85-NA is concerned it is stated that the powers conferred on the Executive in the garb of the rule-making powers conferred under Section 73-M of the Act cannot empower the passing of such a rule and that, as in effect it would deprive the other elected members of the Board of their right to administer the affairs of the Society, it would constitute a violation of the fundamental right vested in the petitioner.

4. On all these grounds a writ of declaration is asked for declaring Section 73-J as inoperative and Rule 85-NA read along with the along section, as offending the constitutional guarantee given to the petitioner under Article 19(1)(c) of the Constitution.

5. In the counter-affidavit of the respondents the allegations are denied and the legal contentions are met by saying that neither Section 73-J nor Rule 85-NA, which are challenged, would in any way offend the fundamental rights enshrined in Article 19(1)(c) of the Constitution. Particular reference is made to the text o