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2001 Supreme(All) 1196

IN THE HIGH COURT OF ALLAHABAD
Yatindra Singh, J.
Amulya Singh and Others – Appellants
Versus
Nagareeya Sahkari Bank Ltd., Varanasi and Others – Respondents
C.M.W.P. No. 35855 of 2000 with 16 other Writ Petitions
Decided On : 25-04-2001

Advocates Appeared:
For the Appellant : Ashok Bhushan and nil Bhushan
For the Respondent: S.C., M.M. Sahai and A.K. Singh

Headnote:

The Court held that cooperative societies registered under the Cooperative Societies Act are not State within the meaning of Article 12 of the Constitution of India. It further held that a writ petition is not maintainable against a cooperative society (that is not a State) for violation of non-statutory provisions.

Fact of the Case:

The petitioners were appointed on different dates after a new district of Chandauli was carved out. This was in the year 1997 and 1998. A chart showing details of writ petitions, names of the petitioners and dates of their appointments is appended as Appendix I to this judgment. Appointment letters of all petitioners are similar. One such letter is appended as Appendix II to this judgment. Other letters of appointment are similar. They were appointed on temporary basis. It was also mentioned there that they might be considered for being made permanent after one year in event of their work being satisfactory.

Finding of the Court:

The Court held that the 1975 Regulations are not applicable to the Bank. There was no necessity of obtaining any approval of the Board before appointing the petitioners.

Issues: 1. Whether every co-operative society, registered under the Co-operative Societies Act, is a State within the meaning of Article 12 of the Constitution of India? 2. Whether a co-operative society, registered under the Co-operative Societies Act, performs duties of public nature or acts in public sphere? 3. Whether a writ petition is maintainable against a cooperative society (that is not a State) for violation of non-statutory provision or while acting in private sphere.

Ratio Decidendi: The Court held that the 1975 Regulations are not applicable to the Bank. There was no necessity of obtaining any approval of the Board before appointing the petitioners. The Court further held that the petitioners are deemed to be in service on original terms and condition but without any back wages. In those cases where there were any interim orders, the petitioners would be entitled for salary for the period that they have actually worked.

Final Decision: The Court held that the 1975 Regulations are not applicable to the Bank. There was no necessity of obtaining any approval of the Board before appointing the petitioners. The Court further held that the petitioners are deemed to be in service on original terms and condition but without any back wages. In those cases where there were any interim orders, the petitioners would be entitled for salary for the period that they have actually worked.

JUDGMENT :

Yatindra Singh, J.

INTRODUCTION

Is a Cooperative Society a State within the meaning of Article 12 of the Constitution of India? Does it perform public functions? is a writ petition maintainable against it for violation of non-statutory provision? What is meaning of the phrase, whose area of operation extends to more than one district occurring in the notification dated 4th March. 1972 (the 1972 Notification) u/s 122 of the U.P. Co-operative Societies Act. 1965 (the Co-operative Societies Act)? These are the questions involved in these writ petitions. But before adverting to the facts of the cases, I would tike to explain meaning of few words as used by me in this judgment and details of the Appendix appended to this Judgment.

WORDS AND DETAILS OF THE APPENDICES

2. In this Judgment, following words have meaning assigned to them below :

(i) The Co-operative Societies Act means the U.P. Co-operative Societies Act. 1965.

(ii) The Banking Regulation Act means the Banking Regulation Act. 1949.

(iii) The rules means the U.P. Cooperative Societies Rules, 1968 framed under the Co-operative Societies Act.

(iv) The 1975 Regulations, means U.P. Co-operative Societies Employees Service Regulations, 1975.

(v) The 1972 notification means Notification No. 366-C/XII-C-3-36-71, dated 4th March. 1972 u/s 122 of the Cooperative Society Act constituting the Board.

(vi) The Bank means Nagareeya Shakarl Bank Ltd., Lahuraveer (Ram Katora), Varansi.

(vii) The Board means U.P. Cooperative Industrial Services Board constituted under the 1972 notification.

(viii) 'The DR' means the Deputy Registrar Co-operative Societies of the Varanasi Division, Varanasi.

(ix) 'Private body' means a body that is not a State,

(x) 'RBR means the Reserve Bank of India.

(xi) 'State' means a body, which is State within the meaning of Article 12 of the Constitution.

3. The details of Appendixes at the end of this Judgment are as follows :

1. Appendix I.--Contains dates of appointments of the petitioners in different petitions.

2. Appendix II.--Contains one appointment letter and one termination order. The other letters of appointment and termination orders are similar.

3. Appendix III.--Contains relevant extract of the order of the DR discharging show cause notice for suspension of the committee of management.

4. Appendix IV.--Contains Section 128 of the Co-operative Societies Act.

5. Appendix V.--Contains relevant regulations of the 1975 Regulations.

6. Appendix VI.--Contains relevant sections of the Banking Regulation Act.

7. Appendix VII.--Contains few words regarding comments of Lord Simonds, 'naked usurpation of the legislative function under the thin disguise of Interpretation in Magor and St. Meltons Rural District Council v. Newport Corporation, 1951 (2) All ER 839 (at page 841) referred to paragraph 38 of this judgment.

THE FACTS

4. Nagareeya Sahkari Bank Ltd., Lahuraveer (Ram Katora), Varanasi (the Bank) is a co-operative society registered under the Cooperative Societies Act. The Bank was registered under the Co-operative Societies Act. The Bank took licence from the RBI for doing Banking business and was registered, under the Co-operative Societies Act. Its area of operation was mentioned as municipal limits of Varanasi Nagar Mahapalika. It was within one district, namely, Varanasi District. Subsequently, it took permission for opening new branches from the RB1 and was granted permission to start business at 8 other centres. These 8 places, at the time when permission was granted, were within District Varanasi. Thereafter proceedings were taken for amendment of the bylaws for including these 8 places in its area of operation. This was considered by the Deputy Registrar of Co-operative Societies, Varanasi Division (the DR) on 3.2.1993. At that time, one place, namely. Bhadohi separate district. The DR granted permission to start business only at 7 pleaces : Bhadohi was except













































































































































































































































































































































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