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2004 Supreme(P&H) 708

PUNJAB AND HARYANA HIGH COURT
Swatanter Kumar and Ajay Kumar Mittal, JJ.
Gopal Singh Jania and others - Petitioners
Versus
State of Punjab and others - Respondents
Civil Writ Petition No. 5412 of 2003.
Decided On : 15 July, 2004

Advocates Appeared:
For the Petitioners:Mr. H.S. Mattewal, Sr. Advocate with Mr. R.S. Riar, Advocate.
For the Respondent Nos. 1 to 4:Mr. C.M. Munjal, Addl. Advocate General, Punjab.
For the Respondent No. 5:Mr. M.S. Bedi, Advocate.
For the Respondent No. 6:Mr. S.S. Gill, Advocate.

The removal order based on different grounds than those in the show-cause notice violated principles of natural justice, leading to its invalidation and remand for fresh decision.

Headnote:

Cooperative Bank - Punjab Cooperative Societies Act, 1961 - Section 27(1) - Summary: The court disposed of Civil Writ Petitions 5412 and 13199 of 2003, which were inter-linked. The petitioners, elected Directors of the Amritsar Central Cooperative Bank, challenged their removal under Section 27(1) of the 1961 Act. The court found that the removal order was based on different grounds than those mentioned in the show-cause notice, violating principles of natural justice. The court quashed the removal order and remanded the matter for fresh decision.

Fact of the Case:

The petitioners, elected Directors of a cooperative bank, challenged their removal under Section 27(1) of the 1961 Act, alleging mala fide and violation of natural justice. The court found that the removal order was based on different grounds than those mentioned in the show-cause notice.

Finding of the Court:

The court invalidated the removal order, citing violation of natural justice and different grounds for removal than those in the show-cause notice. The court remanded the matter for fresh decision.

Issues: Violation of natural justice, mala fide allegations, and different grounds for removal than those in the show-cause notice.

Ratio Decidendi: The removal order based on different grounds than those in the show-cause notice violated principles of natural justice. The court quashed the removal order and remanded the matter for fresh decision.

Final Decision: The court quashed the removal order and remanded the matter for fresh decision.

ORDER

Ajay Kumar Mittal, J. - By this order, we propose to dispose of Civil Writ Petitions 5412 and 13199 of 2003, as the points of law and fact raised in these petitions are somehow common and inter-linked.

2. Civil Writ Petition No. 5412 of 2003 has been filed by six persons, namely, Gopal Singh Jania and five others, who claim themselves to be duly elected Directors of the Amritsar Central Cooperative Bank Limited, Amritsar (respondent No. 5), a body registered under the Punjab Cooperative Societies Act, 1961 (for short "the 1961 Act"), challenging the notice dated 28.6.2002 (Annexure P-4) issued by respondent No. 3 under Section 27(1) of the 1961 Act, whereby they were required to show-cause as to why they be not ceased to be the elected Directors of the said Bank. They have also prayed for issuance of a writ of certiorari quashing order dated 21.3.2003 (Annexure P-9) passed by the Joint Registrar, Cooperative Societies, Jalandhar Division, Jalandhar (respondent No. 3) exercising the powers of the Registrar, Cooperative Societies, Punjab Chandigarh vide which they have been removed as elected Directors of the respondent-bank, in exercise of power under Section 27(1) of the 1961 Act.

3. A little background needs to be noticed to understand as to how and in what manner the aforesaid orders came to be passed. According to the petitioners, they were elected to the Board of Directors of the respondent-bank on 8.5.2000 for a term of five years which was to last till 8.5.2005 and they had been discharging their duties with a great sense of responsibility, diligently and without there being any finger raised by anyone to their functioning. It is the specific case of the petitioners that after the Assembly Elections held in the State of Punjab in February 2002, Shri Sardool Singh (respondent No. 6) became the Excise and Taxation Minister, Punjab who on coming into power openly declared that the elected members of the Board of Directors owing allegiance to SAD (Badal) shall be removed and instead new Board of Directors from amongst the Congress Party supporters shall be inducted by way of fresh elections. The petitioners claim, as expected, they received a copy of order 31.5.2002 (Annexure P-2) whereby Joint Registrar Cooperative Societies, Jalandhar exercising the powers of the Registrar Cooperative Societies, Punjab suspended the Board of Directors of the respondent-bank and appointed the Deputy Registrar Cooperative Societies, Amritsar as Administrator for a period of three months to run the affairs of the bank. A perusal of the aforesaid order would reveal that it was initially passed in exercise of power under Section 27(1)(e) of the 1961 Act, which was lateron amended by order dated 3.6.2002 (Annexure 2-A) stating that the order Annexure P-2 may be taken to have been passed in exercise of powers by the Registrar under Section 27(2) of 1961 Act.

4. The petitioners challenged the orders Annexures P-2 and P-2/A by filing a writ petition (CWP No. 9492 of 2002) in this Court. During the pendency of the said writ petition, the petitioners had been served with show-cause notice dated 28.6.2002 (Annexure P-4) which was duly replied to well within the time mentioned therein. But the Joint Director in exercise of power of the Registrar Cooperative Societies, Punjab under Section 27(1)(a) of the 1961 Act removed the Board of Directors of the respondent-Bank and directed the Administrator of the Bank for taking further necessary action regarding elections to the new Board of Directors, by order dated 15.7.2002, Annexure P-6. This order of removal was also challenged by the petitioners by amending the said writ petition already pending i.e. CWP 9492 of 2002. The said writ petition was allowed by a Division Bench of this Court vide order dated 13.2.2003, and the order of removal of the petitioners from the Board of Directors was invalidated on the ground that rule of audi alteram partem was not complied with by the respondent-authorities sin



































































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