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2025 Supreme(Online)(Mad) 56945

IN THE HIGH COURT OF JUDICATURE AT MADRAS
C.V.KARTHIKEYAN, R.VIJAYAKUMAR, JJ
S.Krishnakumar President Aralvaimozhi Primary Agricultural Co-operative Credit Society, Aralvaimozhi Kanyakumari District – Appellant
Versus
S.Murugesan – Respondent
W.A(MD).No.847 of 2020



Advocates:
For the Appellant: Mr.D.Shanmugaraja Sethupathi
For the Respondents: Mr.T.Cibi Chakraborthy, Mr.P.T.Thiraviyam, Mr.M.Mahaboob Athiff

Disqualification provisions require strict interpretation and cannot rely on conjecture; inferred involvement in a business inconsistent with society is insufficient for disqualification.

Headnote:(A) Tamil Nadu Co-operative Societies Act, 1983 - Section 23(1)(e) - Disqualification of a member - Appellant was alleged to run a pawn broker business conflicting with the society's byelaws. Writ Court disqualified him based on inferred evidence. The court found that mere association with a nominee's license does not imply running a business inconsistent with the Society, and emphasized strict interpretation in disqualification cases. (Paras 15, 27, 28, 30)

(B) Interpretation of statutory provisions - Disqualification provisions require strict and reasonable interpretation considering real circumstances, not conjecture. (Paras 23, 26)

Facts of the case:
Appellant contested election and was subsequently challenged for disqualification due to allegations of running a pawn broker business via his wife, leading to court proceedings and a final disqualification ruling by the writ court.

Findings of Court:
Writ court's disqualification based on inferential evidence was found improper; disqualification provisions must be strictly interpreted; ruling overturned.

Issues: Whether the appellant was engaged in a conflicting business affecting the Society; the interpretation of disqualification clauses.

Ratio Decidendi: The court ruled that statutory provisions for disqualification must be strictly interpreted and inferred conclusions drawn without firm evidence do not suffice.

Result: Writ appeal allowed.

Table of Content
1. appellant's alleged business involvement. (Para 2 , 4 , 5)
2. arguments regarding disqualification. (Para 6 , 9 , 10)
3. writ court's findings and basis for disqualification. (Para 8 , 14 , 18)
4. principle of strict interpretation of disqualification. (Para 23 , 26 , 28)
5. overturning of writ court decision. (Para 29 , 30)

JUDGMENT

(Made by R.VIJAYAKUMAR,J.

The 4th respondent in WP(MD).No.7710 of 2020 has filed the present writ appeal challenging the order of the writ Court wherein he has been found to be disqualified to be a member of the Co-operative Credit Society.

(A)Factual Matrix:

2.The appellant herein is a member of Aralvaimozhi Primary Agriculture Co-operative Credit Society. He contested the election for Board of Director in Kanyakumari District Co-operative Union and got elected as President. Immediately, after declaration of results, one George Newton had filed WP(MD).No.20303 of 2019 challenging the final list of Elected Board of Directors of the Kanyakumari District Co-operative Union Limited primarily on the ground that the appellant herein is running a Private Finance Company in the name and style of 'M/s.Balaji Finance' which is in violation of the Co-operative Societies Act. This Court by an order dated 20.09.2019 held that once results have been declared, the Court cannot interdict to the process. However, granted liberty to the petitioner therein to approach the Chief Election Commissioner, Tamil Nadu State Co-operative Societies to ventilate his grievance. However, there are no records to show that the petitioner therein had approached the Chief Election Commissioner.

3.One S.Murugesan has given a representation to the 4th respondent herein on 24.06.2019 seeking to disqualify the appellant herein on similar grounds. Since the said representation was not considered, he had filed WP(MD).No.17084 of 2019. This Court by an order dated 24.01.2020 had directed the respondents to consider the representation of the petitioner herein and to pass orders in accordance with law.

4.In compliance with the order of this Court in WP(MD).No.17084 of 2019, the 4th respondent herein had conducted an enquiry and passed an order on 21.02.2020 to the effect that the appellant herein has not suffered any disqualification. Challenging the said order, Mr.Murugesan had filed the above writ petition in WP(MD).No.7710 of 2020. The writ Court by its order dated 03.09.2020 after considering the provisions of the Tamil Nadu Co-operative Societies Act, had set aside the order the 4th respondent and allowed the writ petition wherein a direction was issued to disqualify the appellant herein from the basic membership of the Society. This order is put to challenge in the present writ appeal.

(B).Submissions before the Writ Court:

5.The primary contention of the writ petitioner before the writ Court was as follows:

a)As per byelaws of the Society, a member should not engage himself in any business or industry which would be similar to that of the Society or would be not in consonance or cause prejudice to the functions of the Society. Mr.S.Krishnakumar is running a Pawn Broker Shop in the name and style of 'M/s.Balaji Finance' for which the license stands in the name of his wife. Offering loan to the member of the Society by pledging of the jewels is one of the main functions of the Society. Therefore, Mr.S.Krishnakumar is directly involved in a business which is contrary to the byelaw.

b)Though the Pawn Broker license stands in the name of Krishnakumar's wife namely Sri.Bindhu, Mr.Krishnakumar is shown as a nominee in the said license.

c)Mr.Krishnakumar has taken a shop on lease from Nagercoil Municipality in his name and in the said shop, the pawn broker business is being run.

6.The appellant herein had contended as follows:

(a).That the Society is being run in a different place and it does not have any jurisdiction in a place where pawn broker business is being conducted by his wife.

(b).The pawn broker business does not stand in the nam

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