IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD
Nagesh Bheemapaka, J.
P Bhaskar Reddy - Appellant
Versus
The State of Telangana - Respondent
Writ Petition No. 6404 of 2024
Decided On : 20-03-2024
No Confidence Motion - Cooperative Society - Telangana Cooperative Societies Act, 1964, Section 34-A, Rule 24-A - The court discussed the mandatory provisions of Section 34-A and Rule 24-A, including the notice period, format of the motion, and the authority to issue the notice. The court also referred to precedents to interpret the notice period requirement and the format of the motion, ultimately dismissing the Writ Petition.
Fact of the Case:
The petitioner, an elected President and Chairman of a Cooperative Society, challenged a notice for a No Confidence Motion issued by the 3rd respondent, alleging it to be illegal, arbitrary, and unjust. The petitioner claimed that the notice did not comply with the mandatory provisions of the Telangana Cooperative Societies Act, 1964 and the Rules framed thereunder.
Finding of the Court:
The court found that the notice period requirement was met, as there was a clear fifteen-day span between the date of the notice and the date of the meeting. The court also held that the format of the motion and the authority to issue the notice were in accordance with the law. Consequently, the Writ Petition was dismissed.
Issues: The issues revolved around the legality of the notice for the No Confidence Motion, including compliance with the notice period, format of the motion, and the authority to issue the notice.
Ratio Decidendi: The court interpreted the notice period requirement and the format of the motion, referring to precedents to determine compliance with the law. The court also considered the authority delegated to issue the notice, ultimately finding in favor of the respondents.
Final Decision: The Writ Petition was dismissed by the court, and no costs were awarded to the petitioner.
ORDER
Nagesh Bheemapaka, J. - Petitioner files the Writ Petition to declare the Notice issued by the 3rd respondent under Section 34-A of the Telangana Cooperative Societies Act, 1964 (for short, 'the Act') and Rule 24-A of the Rules framed thereunder in R.C. No. 755/2024-C, dated 05.03.2024 for conducting a meeting of No Confidence against him on 21.03.2024 at the office of Nizamabad District Cooperative Central Bank, as illegal, arbitrary and unjust.
2. The affidavit reveals that petitioner hails from Pocharam Village and owns Acs.2.00 of agricultural land; due to his land ownership, he became a member of Deshaipet Primary Agricultural Cooperative Society, Deshaipet, Banswada Mandal, now Kamareddy district (for short, 'the Society'). He was elected as a Director of the Society in 2020 and subsequently, the members elected him as President of the Society.
It is noted that the District Cooperative Central Banks are formed and administered by the elected Presidents of the Primary Agricultural Cooperative Societies; therefore, representing Deshaipet Primary Agricultural Cooperative Society, petitioner also holds membership in the District Cooperative Central Bank, Nizamabad.
It is stated that before bifurcation of the Districts in Telangana State, for each District, a District Cooperative Central Bank is established and registered under the Cooperative Societies Act, 1964. These DCCBs served as lending banks catering to the financial needs of Primary Agricultural Cooperative Societies (PACS) in their respective districts. Following petitioner's election as President of the Society and his subsequent membership in the District Cooperative Central Bank, Nizamabad, he was elected as the Chairman of Nizamabad DCCB in 2020. Since then, he has diligently performed his duties, resulting in a significant increase in the bank's turnover and financial stability.
It is also stated that following recent elections in Telangana, certain members of the District Cooperative Central Bank, Nizamabad have developed animosity against petitioner. Some of these members, who borrowed funds from the bank in violation of RBI Regulations, faced pressure from petitioner to repay, leading them to allege 'lack of transparency'. They submitted a proposal for No Confidence Motion to the 3rd respondent, however, the proposal lacks signature at Sl. No.14 and does not adhere to the mandatory requirements outlined in Form No.AAA under Rule 6-A(1) and Section 34-A of the Act and Rule 24-A of the Rules. Specifically, the proposed motion lacks signatures in the presence of witnesses and is not accompanied by the prescribed Form AAA as required by the Rules framed under the Act. The affidavit underscores that the proposed No Confidence Motion is vague and is not supported by allegations, leaving petitioner unaware of the grounds for the Motion. Despite the same, the 3rd respondent proceeded to issue the impugned notice, which called for a meeting on 21.03.2024 at 11.00 a.m. According to petitioner, notice was served personally on 06.03.2024 and via Registered Post on 08.03.2024, falling short of the mandatory fifteen-day notice period prescribed by Section 34-A. Furthermore, public holidays should have been excluded from the notice period calculation. Consequently, the notice issued by the 3rd respondent is deemed contrary to the mandatory provisions of Section 34-A of the Act and Rule 24 of the Rules.
Upon receiving the notice, petitioner was surprised to find that some members had proposed No Confidence Motion and efforts to contact them were unsuccessful. This situation deprived petitioner of the opportunity to address any grievance they may have had, violating constitutional and democratic principles as well as contravening the Rules framed under the 1964 Act and the principles of natural justice.
The 3rd respondent has no power or authority to issue the impugned no
The main legal point established in the judgment is the interpretation of the mandatory provisions of the Telangana Cooperative Societies Act, 1964 and the Rules framed thereunder, particularly regar....
Rule 14 – AKK of Rules, 1960 reads as no Confidence Motion.
If the motion for no confidence fails for want of quorum or lack of requisite majority at meeting, no subsequent meeting for considering motion of no confidence shall be held within six months of dat....
Procedural compliance in no confidence motion notices is sufficient; prior satisfaction of the authority is not necessary, affirming adherence to statutory requirements.
Point of Law : Rule 43-A of Kerala Co-operative Societies Rules, 1969 reads as removal of President, Vice-President etc. by no-confidence motion.
The issuance of a notice for a no confidence motion must comply with statutory requirements, including accompanying resolutions; failure to show prejudice does not invalidate the process.
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