High Court Of Madhya Pradesh
P. D. MULYE, R. K. VARMA
GOVIND ARYA - Appellant
Versus
STATE - Respondents
M. P. 302 Of 1982
Decided On : 10/03/1984
CO-OPERATIVE SOCIETY - MEMBERSHIP - EXPULSION - VALIDITY - SHOW CAUSE NOTICE - JURISDICTION - OFFICER-IN-CHARGE - CO-OPERATIVE SOCIETIES ACT, 1960 - SECTION 19-C, 49-B, 53(4).
Fact of the Case:
Petitioner, a member of a Co-operative Society, challenged the show cause notice issued by the Officer-in-Charge of the Society seeking to expel him and 866 other members on the ground that their membership was invalid and obtained by misrepresentation. The petitioner contended that the Officer-in-Charge lacked the authority to expel members and that the expulsion could only be done by a resolution passed by a three-fourth majority of the Committee at a specially held meeting, as per Section 19-C of the Co-operative Societies Act, 1960.
Finding of the Court:
The Court held that the Officer-in-Charge, appointed under Section 53 of the Act, was a temporary measure and not a full-fledged substitute for the Board of Directors or the Committee. The Officer-in-Charge could not exercise the power to expel members, which was vested in the Committee under Section 19-C. The Court further held that the show cause notice was issued without application of mind, was motivated by mala fides, and was vague and general, rendering it incapable of a specific answer.
Issues: 1. Whether the Officer-in-Charge of a Co-operative Society has the authority to expel members? 2. Whether the show cause notice issued to the petitioner was valid and justified?
Ratio Decidendi: 1. The Court interpreted Section 19-C of the Co-operative Societies Act, 1960, and held that the power to expel members is vested in the Committee of the Society, which must pass a resolution by a three-fourth majority at a specially held meeting. The Officer-in-Charge, appointed under Section 53, does not have the authority to expel members. 2. The Court found that the show cause notice issued to the petitioner was issued without proper consideration, was motivated by mala fides, and was vague and general, making it impossible for the petitioner to provide a specific response.
Final Decision: The Court allowed the petition and quashed the impugned show cause notice issued to the petitioner. The Court directed the return of the security amount to the petitioner.
( 1 ) THE petitioner, who is an agriculturist and resident of Gawali Palasia, Tahsil Mhow, has filed this petition under Art. 226 of the Constitution of India to quash the show cause notice dated 21-4-1982 (Annexure-A) given by respondent No. 3 and direct him not to disturb or deviate from Resolution No. 10 dated 28-3-1978 of respondent No. 4 Society, namely Ambika Aloo Utpadak Vipanan Avam Prakriya Sahakari Samiti Maryadit, Gawali Palasia, granting membership to the petitioner and others and not to remove any member from the register of members.
( 2 ) THE relevant facts giving rise to this petition, may be stated, thus : Respondent No. 4, which is a Co-operative Society is registered under the M. P. Co-operative Societies Act, 1960. The petitioner became a Member of the said Society on 28-3-1978, vide Resolution Annexure-R-3, when the Managing Committee of the Society was superseded. On 14-5-1979 the petitioner was also elected as a Director of the Society which functioned till 14-1-1982 when the Society was again superseded and respondent No. 3 was appointed as the Officer-in-charge of the said Society by the Registrar. The said supersession is under challenge before the Joint Registrar of Cooperative Societies, Madhya Pradesh. ( 3 ) ON 10-5-1982 the petitioner received a show cause notice dated 21-4-1982 (Annexure-A) from respondent No. 3, the Officer-in-charge of respondent No. 4 Society, asking him to him cause why the petitioner's name be not removed from the register of members of the said society. In this notice it is also stated that the Resolution dated 28-3-1972 (28-3-1978?) granting membership of the Society to the petitioner was invalid and it is proposed to be cancelled. Further it is alleged in the said notice that the petitioner was not eligible for the membership of the Society and that he has obtained membership by misrepresentation. Further it is also stated therein that membership was granted to the petitioner even though no shares were available for allotment, the entire share capital having been fully subscribed. Further according to the petitioner similar notices have been served on 867 member of respondent No. 4 Society out of the total membership of 1318. Thus a majority of members of the Society are threatened with expulsion which, if allowed, will change the total complexion of the Society beyond recognition.
( 4 ) THE petitioner by this petition has, therefore, prayed that the action of respondent No. 3 is illegal, arbitrary and mala fide as he has no authority to expel members and has no jurisdiction to give the show cause notice as according to him a member can be expelled according to the provisions of S. 19-C of the M. P. Cooperative Societies Act, 1960 on the only grounds mentioned therein. The petitioner has, therefore, submitted that as he does not fall in any one of the categories mentioned in the said section, the power given to the Committee in this section cannot be exercised by the Officer-in-charge alone because a resolution has to be passed by three fourth majority and this has to be done at a meeting specially held for that purpose. Thus the officer-in-charge could not have acted under this section at all.
( 5 ) FURTHER according to the petitioner the said Officer-in-charge is appointed under S. 53 of the said Act as a temporary stop-gap arrangement and not as a full-fledged substitute for the Board of Directors or the Committee. The person so appointed to manage the affairs of the Society cannot over-step his function and start throwing a large body of members of the society out enblock. The petitioner has, therefore, prayed that the show cause notice being ultra vires the Act, having been issued without application of mind, motivated by mala fides, being vague and general and incapable of specific answer having been issued illegally, arbitrarily, mala fide and with capricious exercise of power, infringing the freedom of association granted by Art. 19 of the constitut
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.