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1972 Supreme(All) 265
Allahbad High Court
A.K.KIRTY,GOPINATH
The District Co-operative Bank Ltd. - Appellant
Versus
Deputy Registrar, Cooperative Societies - Respondent
Decided On : 10/30/1972
A. Kumar, J.N. Dabey and S.N. Kacker, for Appellants; V.B. Singh and Shanti Bhushan, Standing Counsel, for Respondents.
Headnote:
CO-OPERATIVE SOCIETY - DISQUALIFICATION OF MEMBER OF COMMITTEE OF MANAGEMENT - DEFAULT TO PRIMARY SOCIETY - INTERPRETATION OF RULE 453 (K) OF U. P. CO-OPERATIVE SOCIETIES RULES AND BYE-LAW NO. 10 (TA) OF BANK'S BYE-LAWS - WRIT PETITION - MAINTAINABILITY - ALTERNATIVE REMEDY.
Fact of the Case:
The petitioner, a member of the Committee of Management of the District Co-operative Bank, was removed from office on the ground that he was disqualified for membership under Rule 453 (k) of the U. P. Co-operative Societies Rules, as he was a defaulter to the Primary Society. The petitioner challenged the resolution on the ground that he was not a defaulter to the Bank and that no notice was served on him before the meeting as required by Rule 454 of the Rules. The Single Judge quashed the impugned resolution on the ground that a default to the Primary Society was not a disqualification for membership of the Committee of Management under Rule 453 (1) (k) of the Rules.
Finding of the Court:
The Court held that the literal interpretation of clause (k) of Rule 453 (1), adopted by the learned Single Judge, would lead to an anomalous position where a delegate who is a defaulter to the Primary Society could continue as a member of the Managing Committee of the Central Bank. The Court also held that the impugned resolution was liable to be quashed as the Committee of Management had not complied with the mandatory procedure laid down by Rule 454 and had acted in violation of the principles of natural justice by not giving the petitioner a reasonable opportunity to defend himself.
Issues: 1. Whether a default to the Primary Society is a disqualification for membership of the Committee of Management of a Central Co-operative Bank under Rule 453 (k) of the U. P. Co-operative Societies Rules? 2. Whether the impugned resolution removing the petitioner from the office of membership of the Managing Committee and the office of Chairman of the Bank is liable to be quashed for non-compliance with the mandatory procedure laid down by Rule 454 and violation of the principles of natural justice?
Ratio Decidendi: 1. The Court held that the literal interpretation of clause (k) of Rule 453 (1), adopted by the learned Single Judge, would lead to an anomalous position where a delegate who is a defaulter to the Primary Society could continue as a member of the Managing Committee of the Central Bank. The Court also held that the impugned resolution was liable to be quashed as the Committee of Management had not complied with the mandatory procedure laid down by Rule 454 and had acted in violation of the principles of natural justice by not giving the petitioner a reasonable opportunity to defend himself. 2. The Court held that the impugned resolution was liable to be quashed as the Committee of Management had not complied with the mandatory procedure laid down by Rule 454 and had acted in violation of the principles of natural justice by not giving the petitioner a reasonable opportunity to defend himself.
Final Decision: The appeal was dismissed, but the parties were directed to bear their own costs throughout.
GOPI NATH, J. :- This is an appeal against the order of a learned Single Judge dated 19th May, 1972 allowing a writ petition. The petition challenged a resolution passed by the Managing Committee, District Co-operative Bank Ltd., removing the petitioner-respondent from the office of a member as also the office of Chairman of that Committee. The District Co-operative Bank Ltd., Mainpuri and one Sri Kishan Murari Misra who were opposite parties in the writ petition are now appellants in the appeal. Sri Rajendra Singh who was the petitioner in the writ petition is the main respondent in the appeal. The other opposite parties of the writ petition are also arrayed as respondents in the appeal.
2. The facts leading up to the petition giving rise to the appeal are as follows :-
There is a co-operative society named Sadhan Sahkari Samiti, hereinafter to be referred as Primary Society, in the district of Mainpuri. This Society (Samiti) was the member of another Co-operative Society known as the District Co-operative Bank Mainpuri, hereinafter referred to as the Bank which was a Central Co-operative Bank, the main object of which was to lend money to Co-operative Societies which were its ordinary members. The petitioner-respondent is a delegate from the Primary Society was elected a member of the Committee of Management of the Bank. An election was held on 30th December, 1969, for the office of the Director of the Bank from amongst the Members of the Committee of Management. The petitioner-respondent contested the election and was elected a Director on the aforesaid date. He was thereby declared a President of the Bank as he commanded a majority amongst the elected Directors. The petitioner-respondent accordingly became the Chairman of the Committee of management and started functioning as such. On the 16th October, 1971 an agenda was circulated for convening a meeting on the 21st October, 1971 to consider a proposal for the removal of the petitioner respondent from the office of the Chairman on the ground that he was disqualified for the membership of the Committee of Management under Rule 453 of the U. P. Co-operative Societies Rules. Out of the several grounds of disqualification mentioned, one was that he being a defaulter of his primary Society could not contest an election to the Membership of the Committee of Management. His election as such was in contravention of the U. P. Co-operative Societies Rules and the bye laws of the Bank. A notice containing the agenda was, according to the appellant, sent to the petitioner-respondent through a peon which he read but returned without making any endorsement about its receipt. The appellants stated in the counter-affidavit that as a measure of precaution the notice of the meeting was communicated to the petitioner by two separate telegrams dated 17th October, 1971 to his local and permanent addresses and the agenda was sent to him by registered post acknowledgment due on the 19th October, 1971, 18th October, being a holiday. The allegations against the petitioner were that he was a defaulter to the Primary Society in the sum of Rs. 200/- and had not paid the same in spite of a demand notice given to him on 1st April, 1969. A meeting of the Committee of Management was held on the 21st October, 1971, as scheduled. An objection raised on behalf of the supporters of the petitioner-respondent that the notice was not duly served on the petitioner-respondent was overruled. A resolution was, thereafter, passed that the petitioner-respondent was disqualified for Membership of the Committee of Management as he was a defaulter to the primary society at the time of his election. The Committee further resolved that the petitioner-respondent being disqualified under Rule 453-K of the U. P. Co-operative Societies Rules and bye-law No. (10) Ta of the Bye laws of the Bank could not hold the office of Chairman. The Committee accordingly resolved that he be removed from the office of the Chairman.
