JUDGMENT :

Sudhir Agarwal, J.

A Division Bench, finding itself unable to agree with the law laid down by an earlier Division Bench in Kamil Kidwai v. State of U.P. and others, 1992 (10) LCD 263, on the interpretation of Section 38(1) of U.P. Co-operative Societies Act, 1965 (hereinafter referred to as U.P. Act, 1965), in respect of power of Registrar, with regard to sanction of resolution of Committee of Management of a Co-operative Society, passed in exercise of power under Rule 454 of U.P. Co-operative Societies Rules, 1968 (hereinafter referred to as Rules, 1968) and a follow up decision in Writ Petition No.45314 of 2014 (Smt. Vandana Varma and 2 others v. State of U.P. and 6 others) decided on 29.8.2014, made reference to Larger Bench for answering the following question:-

"Whether, the division benches in Kamil Kidwai v. State of U.P., 1992 (10) Lucknow Civil Decisions, 263, followed in Writ Petition No. 45314 of 2014, in so far as the exercise of power by a committee of management of a cooperative society, under rule 454, is subject to grant of sanction by Registrar under section 38(1) of the Act lays down the correct law?"

2. Before adverting to the aforesaid question we find it appropriate to have a bird eye view of a few relevant facts, giving rise to this controversy.

3. District Co-operative Bank Limited, Muzaffarnagar (hereinafter referred to as D.C.B.) is a Central Level Co-operative Society registered under U.P. Act, 1965. It is engaged in the business of banking and has received a licence for this purpose from Reserve Bank of India under Banking Regulations Act, 1949 (hereinafter referred to as B.R. Act, 1949). D.C.B. has individual members as also many Primary Agricultural Credit Societies as members.

4. Petitioner-1, Smt. Vandana Varma, was initially a member of Sadhan Sahkari Samiti Limited, Meerapur (Dakshini). Later on, she was shifted to village Kutubpur, Tehsil Jansath, District Muzaffarnagar. She made a request to Assistant Registrar, Co-operative, Jansath, Muzaffarnagar (hereinafter referred to as A.R. (C.O.)) to permit her to become a member of Kisan Sewa Sahkari Samiti Limitted, Kutubpur, Muzaffarnagar (hereinafter referred to as KSSSL, Kutubpur) which was allowed by A.R. (C.O.) vide order dated 3.4.2012 and that is how she became member of a Primary Agricultural Credit Co-operative Society at Kutubpur i.e. KSSSL, Kutubpur. She was elected as delegate from KSSSL, Kutubpur to represent in general body of D.C.B. where she was elected as a member of Committee of Management in the elections held on 29.1.2013. Then she was elected as Chairman of Committee of Management of D.C.B. on 30.1.2013.

5. Petitioner-2, Ashok Kumar, was elected as Vice Chairman on 30.1.2013 and Petitioner-3, Mudit Varma, is an elected Director of Committee of Management of D.C.B. from Professional Constituency of D.C.B.

6. Bank had 14 elected Directors in Committee of Management. Three Directors of Committee of Management of D.C.B. made a complaint dated 25.7.2014 alleging that petitioners have incurred some disqualification under Rule 115 and 453(1) of Rules, 1968. By letter dated 13.8.2014 a meeting was convened on 21.8.2014. A notice was issued by Secretary/Chief Executive Officer of D.C.B. Pursuant to aforesaid meeting, a resolution was passed on 21.8.2014 against petitioners and a consequential letter was communicated on 22.8.2014.

7. This letter was challenged by petitioners in Writ Petition No.45314 of 2014. This Court held, when charges relate to Rule 115, an office bearer can be removed only in accordance with Section 38 and for this purpose relied on the decisions in Madan Pal Singh and another v. The Additional District Magistrate, Meerut and others, 1980 ALJ 1098 and Kamil Kidwai v. State of U.P. and others, 1992 (10) LCD 263. It held that whenever it occurs to Committee of Management that an officer of Society has become subject to any disqualification and ineligible to hold post, Committee will approach Registrar, obtain his san