2024 Supreme(Online)(MAD) 32255
HIGH COURT OF MADRAS
Hon`ble Mr.Justice G.R.SWAMINATHAN
Great Lakes Multi-State Co-o – Appellant
Versus
The Central Registrar of Coo – Respondent
Disputes regarding the management of cooperative societies must be referred to arbitration immediately upon arising, as stipulated in the Multi-State Cooperative Societies Act, 2002.
Headnote:
Arbitration - Cooperative Societies - Multi-State Cooperative Societies Act, 2002 - Section 84 - The court determined that disputes regarding the management and constitution of a cooperative society must be referred to arbitration as mandated by the MSCS Act.
Fact of the Case:
Two writ petitions were filed by a cooperative society's CEO against actions taken by former board members and changes registered without due process, leading to a dispute over management and authority within the society.
Issues: The court examined whether the first respondent rightfully registered amendments to the society's bylaw, revoked login credentials, and properly referred the matter to arbitration under Section 84.
Ratio Decidendi: The court ruled that any dispute involving the management of a cooperative society must be referred to arbitration immediately upon its emergence, adhering to statutory mandates.
Final Decision: The impugned orders were set aside; the case was allowed, restoring the previous management status of the cooperative society.
Orders were reserved in these writ petitions on 21.12.2023. It was the last day of the three months roster period. After hearing both sides, the counsel were requested to submit written notes. I was assigned other duties by My Lord The Hon-ble Chief Justice during the months of January and February, 2024. I was once again re~assigned the general miscellaneous roster from March~2024 onwards. Due to sheer workload, I could not pronounce orders in these two writ petitions. I am conscious that the Hon-ble Supreme Court of India has repeatedly mandated that judgments, if reserved, should be pronounced within three months. I have overshot the time limit. However, counsel on either side did not file any miscellaneous petition seeking rehearing. Even if the matters are de~reserved, it will be once again, listed only before me. I therefore proceed to pronounce the order notwithstanding the expiry of the time~limit laid down by the Hon-ble Supreme Court of India.
2.Great Lakes Multi~State Co~operative Housing Society Limited, is the petitioner in both these writ petitions. The petitions have been filed through Thiru.S.Sakthivel, who asserts that he is its Chief Executive Officer. The petitioner~Society was registered as a Multi~State Co~operative Society under Section 7 of the Multi~State Co~operative Societies Act, 2002 (Act 39 of 2002) (hereinafter referred to as “MSCS Act, 2002“) and the rules framed thereunder. The registration number of the Society is MSCS/CR/817/2013. A copy of the Certificate of Registration dated 29.04.2013 issued by the Central Registrar of Cooperative Societies has been enclosed in the typed set of papers. Thiru.S.Sakthivel, was the Chief Promoter of the Society. He was also appointed as its Chief Executive Officer. 3.The by~law of the Society was amended in the year 2014 and the registered address of the Society became No.76/190, South Car Street, Srivilliputhur~626125, Virudhunagar District, Tamil Nadu. A copy of the Certificate of Registration of Amendment dated 03.07.2014 has been enclosed in the typed set of papers. According to the writ petitioner, respondents 4 to 8 herein who were elected to the Board of Directors fraudulently executed a registered General Power of Attorney dated 23.06.2022 in favour of the 10th respondent herein empowering him to alienate the property belonging to the Society situated at Alandur, Chennai. The petitioner would further allege that illegal consideration passed from 10th respondent to respondents 4 to 8.
Therefore, after issuing show cause notices, they were removed from the Board and also the primary membership of the Society on 01.11.2022. The Board of Members were elected in the election held on 01.11.2022. The office~ bearers were elected on 03.11.2022. This was duly intimated to the first respondent vide letter dated 03.11.2022. It is the further stand of the petitioner that this removal was communicated to respondents 4 to 8 on 02.11.2022 and their paid share capital was also returned on 03.11.2022. 4.The grievance projected in the writ petitions is that while so, respondents 4 to 8 have made it appear as if Thiru.S.Sakthivel, was already removed as CEO on 20.03.2020 and that the 9th respondent was appointed as CEO on 02.02.2021. One Thiru.R.Ramesh, Retired District Registrar of Co~ operative Societies purported to hold election on 15.03.2023 for electing the new Board of Directors. He issued proceedings to the effect that respondents 11 to 17 were elected on 15.03.2023 and that their tenure will be from 16.03.2023 till 15.03.2028. The 9th respondent herein also sent e~mail to the first respondent on 20.02.2023 for change of official e~mail address / mobile number and for revocation of the existing login credentials for MSCS Portal.
This request was accepted by the first respondent and new login credentials were generated. The respondents 11 to 17 also passed resolution for change of address of the registered office of the society from Srivilliputhur to Chennai.