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The District Co-operative Bank Ltd. and anr. Vs. Deputy Registrar, Co-operative Societies and ors. - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtAllahabad High Court
Decided On
Case NumberSpecial Appeal No. 307 of 1972
Judge
Reported inAIR1973All348
ActsConstitution of India - Article 226; Uttar Pradesh Co-operative Societies Rules, 1968 - Rules 86, 87, 453, 453(1) and 454
AppellantThe District Co-operative Bank Ltd. and anr.
RespondentDeputy Registrar, Co-operative Societies and ors.
Appellant AdvocateA. Kumar, ;J.N. Dabey and ;S.N. Kacker, Advs.
Respondent AdvocateV.B. Singh, Adv. and ;Shanti Bhushan, Standing Counsel
DispositionAppeal dismissed
Excerpt:
trust and societies - certiorari - article 226 of constitution of india and rules 453 and 454 of u.p. co-operative societies rules, 1968 - committee constituted - discharge function under rule 454 - act under the statute as a body for all practical purposes - whether writ of certiorari can be issued against committee of management of central co-operative bank - held, certiorari can be issued. - - strong reliance was placed on c. moreover the impact of a provision of law like rule 454 of the u. ' this decision has been approved by the english as well as indian courts as a satisfactory exposition of the scope and powers of a court of supervisory jurisdiction to issue a writ of certiorari. under rule 454, the duty imposed upon the committee and the powers conferred on it are clearly.....gopi nath, j.1. this is an appeal against the order of a learned single judge dated 19th may, 1972 allowing a writ petition. the petition challenged a resolution passed by the managing committee, district co-operative bank ltd., removing the petitioner-respondent from the office of a member as also the office of chairman of that committee. the district co-operative bank ltd., mainpuri and one sri kishan murari misra who were opposite parties in the writ petition are now appellants in the appeal. sri rajendra singh who was the petitioner in the writ petition is the main respondent in the appeal. the other opposite parties of the writ petition are also arrayed as respondents in the appeal.2. the facts leading up to the petition giving rise to the appeal are as follows:--there is a.....
Judgment:

Gopi Nath, J.

1. This is an appeal against the order of a learned Single Judge dated 19th May, 1972 allowing a writ petition. The petition challenged a resolution passed by the Managing Committee, District Co-operative Bank Ltd., removing the petitioner-respondent from the office of a member as also the office of Chairman of that Committee. The District Co-operative Bank Ltd., Mainpuri and one Sri Kishan Murari Misra who were opposite parties in the writ petition are now appellants in the appeal. Sri Rajendra Singh who was the petitioner in the writ petition is the main respondent in the appeal. The other opposite parties of the writ petition are also arrayed as respondents in the appeal.

2. The facts leading up to the petition giving rise to the appeal are as follows:--

There is a co-operative society named Sadhan Sahkari Samiti, hereinafter to be referred as Primary Society, in the district of Mainpuri. This Society (Samiti) was the member of another Co-operative Society known as the District Co-operative Bank Mainpuri, hereinafter referred to as the Bank which was a Central Co-operative Bank, the main object of which was to lend money to Co-operative Societies which were its ordinary members. The petitioner-respondent is a delegate from the Primary Society was elected a member of the Committee of Management of the Bank. An election was held on 30th December, 1969, for the office of the Director of the Bank from amongst the Members of the Committee of Management. The petitioner-respondent contested the election and was elected a Director on the aforeaid date. He was thereby declared a President of the Bank as he commanded a majority amongst the elected Directors. The petitioner-respondent accordingly became the Chairman of the Committee of management and started functioning as such. On the 16th October, 1971 an agenda was circulated for convening a meeting on the 21st October, 1971 to consider a proposal for the removal of the petitioner respondent from the office of the Chairman on the ground that he was disqualified for the membership of the Committee of Management under Rule 453 of the U. P. Co-operative Societies Rules. Out of the several grounds of disqualification mentioned, one was that he being a defaulter of his primary Society could not contest an election to the Membership of the Committee of Management. His election as such was in contravention of the U. P. Co-operative Societies Rules and the bye laws of the Bank. A notice containing the agenda was, according to the appellant, sent to the petitioner-respondent through a peon which he read but returned without making any endorsement about its receipt. The appellants stated in the counter-affidavit that as a measure of precaution the notice of the meeting was communicated to the petitioner by two separate telegrams dated 17th October, 1971 to his local and permanent addresses and the agenda was sent to him by registered post acknowledgment due on the 19th October, 1971, 18th October, being a holiday. The allegations against the petitioner were that he was a defaulter to the Primary Society in the sum of Rs. 200/- and had not paid the same in spite of a demand notice given to him on 1st April, 1969. A meeting of the Committee of Management was held on the 21st October, 1971, as scheduled. An objection raised on behalf of the supporters of the petitioner-respondent that the notice was not duly served on the petitioner-respondent was overruled. A resolution was, thereafter, passed that the petitioner-respondent was disqualified for Membership of theCommittee of Management as he was a defaulter to the primary society at the time of his election. The Committee further resolved that the petitioner-respondent being disqualified under Rule 453-K of the U.P. Co-operative Societies Rules and bye-law No. (10) Ta of the Bye laws of the Bank could nut hold the office of Chairman. The Committee accordingly resolved that he be removed from the office of the Chairman. This action was taken under Rule 454 of the Cooperative Societies Rules which provides that it shall be the duty of the Committee of Management of a Co-operative Society to ensure that no person incurring any of the disqualifications (which means the disqualifications mention in Rule 453) continues to hold office or the Committee of Management.

3. The petitioner-respondent challenged this resolution, inter alia, on the grounds that he was not a defaulter to the Primary Society, that no notice as required by the provisions of Rule 454 of the Co-operative Societies Rules was served on him before the meeting and the registered letter reached him on the 27th October, 1971 long after the meeting had been held and the resolution passed and that he was not disqualified either under Rule 453-K of the Rules or Bye-laws (10) Ta of the Bank, in that both these provisions relate to a default to the Bank and not to the Primary Society.

4. The learned Single Judge quashed the impugned resolution on the ground that a default to the Primary Society was not a disqualification for the Membership of Ihe Committee of Management under Rule 453 (1) (k) of the Rules. That rule reads:--

'No person shall be eligible to be or to continue as a member of the Committee of Management of any Co-operative Society, for..... (k)he is in default (at least for a period of six months) to the Society in respect of any loan or loans taken by him.'

The learned Single Judge held that this sub-clause refers only to loans which are due by a member of the Society of whose Managing Committee he is a member. It does not contemplate a case where the member is in arrears towards the Society whose delegate he is The petitioner being no defaulter to the Bank was according to the learned Single Judge not disqualified to become a member of the Committee of Management.

5. Bye law (10) (kha), (Ta) provides as follows :

'Koi vakti Bank ke sanchalak mandal ka na to sadasya chuna javega ya bana rahega yadi -- (Ta) Yah apne dwara liya gaya kisi rirh ya rirhon ke sambandh me Bank ya kisi anaya Samiti ka ya vah samiti jiske vah pratinidhi wa karta hai bank ke kisi rirh ke sambandh me kara se kam chah man se bagayadar ho.'

The learned Single Judge held that this bye law did not inflict a disqualification on a member of the Committee of Management of a Bank in cases where he has taken a loan from the primary or other society. According to the learned Single Judge, it refers only to the loans of the Bank being in arrears for over six months and the disqualification attaches only in cases of loans due to the bank and not due to other society or Societies, In the circumstances the learned Judge did not go into the questions whether any notice of the meeting was served on the petitioner before it was held or whether he was actually a defaulter or not on the relevant date.

6. The order of the learned Single Judge has been challenged on three main grounds:

(1) that the resolution of the Managing Committee in question being that of a non-statutory body no writ lay:

(2) that on a true construction of the provisions of the U. P. Co-operative Societies Act and the Rules framed thereunder and the Bye laws of the Bank the petitioner-respondent, being a defaulter to the Primary Society was disqualified for membership of the Committee of Management under Rule 453 (k) and (o) of the Rules and Bye Law No. 10, (Kha), (Ta) of the Bank.

(3) that an alternative and equally efficacious remedy was available to the petitioner-respondent under the Co-operative Societies Rules which he himself having allowed to lapse, the writ petition was not maintainable.

7. We shall deal with the points seriatim:

The first point is concerned with the scope of Article 226 of the Constitution of India. The contention raised is that no writ of certiorari or a direction in the nature thereof under Article 226 of the Constitution can issue to a non-statutory body, i.e., a body not created by a statute. The argument is that a statutory body is a body created by or under a statute and since the committee of Management was not such a body no writ or direction under Article 226 of the Constitution could issue against it. In respect of this contention a large number of cases have been cited on behalf of the appellants. We shall refer to them in a chronological order.

8. In Avadhesh Pratap v. State of U.P., : AIR1952All63 it was held that a writ can be issued not only against an inferior court but also against a statutory body or tribunals. Emphasis was put on the expression 'statutory body'. The case is not in point on the question involved. In T.C. Basappa v. T. Nagappa : [1955]1SCR250 , it was pointed out that a writ of certiorari can be availed of only to remove or adjudicate on the authority of judicial acts. The expression 'judicial act' includes the exercise of quasi-judicial functions by persons obliged to exercise such functions. This case can only be relevant on the question that certiorari can issue to bodies exercising quasi-judicial functions.

To the similar effect is Dalel Singh v. Hon. Secy. Co-op. Union : (1956)ILLJ242All . In State v. Mukhtiar Singh : AIR1957All505 it was pointed out that a writ can be issued against a statutory body invested with statutory powers. It was however not explained in that case what a statutory body is and when is a body invested with statutory powers, nor whether a body becomes a statutory body for the purpose of the issuance of a writ to it where the body is invested with statutory powers of a type which imposes a duty on it to discharge a particular function as required by the Statute. In Sohan Lal v. Union of India. : [1957]1SCR738 , it was held that a mandamus has a reference to a public office and a public duty. It will however have to be seen what a public office and a public duty is. R. K. Tandon v. Central Bank of India : AIR1958All413 held that enforcement of a statutory duty was necessary for the issue of a writ of mandamus. A Bank award was held not to be amenable to a writ of certiorari, bank not being an industrial body or tribunal. The question to be seen, however, in such cases, is when does a body become an industrial body or a tribunal. In Narsinhan v. Chicacole Co-op. Central Bank Ltd., (1959) 1 Lab LJ 554 (Andh. Pra.) it was pointed out that a writ could be issued only to inferior court, tribunal and bodies entrusted with powers by the law of the land to affect the rights of parties. Private bodies being not entrusted with such powers cannot be controlled by writs. In In re, V. S. Hari Haran : (1960)ILLJ164AP it was held that a writ of certiorari could not issue to a private body having no judicial or quasi-judicial authority. The question to be considered in such cases is when does a body get a legal authority to determine questions affecting rights of persons.

9. In M. Durgaiah v. Agent, Tandur Collieries : AIR1961AP400 the learned Judges relied on : (1960)ILLJ164AP and applied the principles laid down therein that a writ of mandamus can be issued to inferior courts, bodies and Tribunals entrusted with powers by the law of land to affect the legal right of parties, these cases do not touch the point under consideration viz., what is a statutory body and whether the origin of the body is material for a writ to issue. Strong reliance was placed on C. Lakshmiah Reddiar v. Sriperumbadur Taluk Co-op. Marketing Society Ltd. : AIR1962Mad169 . It was held in that case that a Board of Directors of a Co-operative Society in considering the objections to the nominations for the election of Members of the Board of Directors is not a statutory tribunal with authority to determine the rights of parties. The Board of Directors in that case discharged the functions entrusted to them by the regulations framed by the Society. The Bench held that since regulations were framed by the Society itself they had, no statutory force. A writ against the Board of Directors accordingly could not issue. Where, however, statutory authority is conferred under the provisions of a statute on a body which is required to determine questions relating to the rights of parties, it will have to be considered whether the conditions required for the issuance of a writ on the ground that the body should be a statutory body are fulfilled or not. Gulab Chand v. Hitkarni Sabha : AIR1963MP270 held that unless a body or authority has legal authority to determine questions affecting rights of subjects, a writ of certiorari could not issue against it. The point to be considered is legal authority. In B. Lakshmi v. Neyveli Lignite Corporation : AIR1966Mad399 it was held that a proceeding of a domestic tribunal of a private body cannot be challenged under Article 226. A private body apparently lacks legal authority to determine questions effecting the rights of parties unless an authority is conferred by common law or statute. In Dwarka Nath v. I.T. Officer : [1965]57ITR349(SC) it was held that certiorari lies against judicial or quasi-judicial acts and not an administrative act. In Lekhraj v. Deputy Custodian Bombay : [1966]1SCR120 it was held that mandamus lay against a public officer in respect of statutory duty. In Praga Tool Corporation v. C.B. Imanual : (1969)IILLJ479SC it was held that in the case of a company, which is a non-statutory body, there is neither a statutory nor a public duty imposed on it by a statute in respect of which enforcement could be sought by a mandamus. Where, however, a body is required to perform an act under a statute which is by way of a command to it the question as to whether it is a body amenable to a writ will have to be considered. In Surya Prasad Tewari v. Managing Committee, 1970 All LJ 404 it was observed that the mere fact that the institution is regulated by a statutory provision and regulation would not convert it into a public or statutory authority. The observations are certainly wide. But the nature and the impact of the statutory provisions and the regulations will have to be considered to find out as to whether the authority has the attributes of a statutory authority by the investment of powers and imposition of duties under a statute. B.R. Gupta v. U.P. Sahkari Ganna Samiti Sangh : (1971)IILLJ381All was relied upon for the proposition that certiorari lies only against orders of public authority acting quasi-judicially. This case is only in line with the cases which laid down that certiorari does not issue to private bodies, the reason being that they have no legal authority to determine questions affecting the rights of subjects. Reliance was finally placed on Vidya Ram v. S. J. N. College : (1972)ILLJ442SC in which an observation was made to the following effect:

'Besides, in order that the third exception to the general rule that no writ will lie to quash an order determining the contract of service albeit illegally as stated in : (1964)ILLJ1SC might apply it is necessary that the order must be the order of a statutory body in breach of a mandatory obligation imposed by a Statute.'

The question at once arises what is a statutory body and whether certiorari can never issue to a body which does not have a statutory origin. This question will be considered hereafter while dealing with cases on the scope of certiorari. Mo case has been cited on the point as to what a statutory body is Vidya Ram's case was on different facts. It was a service matter. A contract of service cannot be specifically enforced unless there is a violation of some provision of law which requires its enforcement. Moreover the impact of a provision of law like Rule 454 of the U.P. Co-operative Societies Rules was not involved in that case. The observations made in that case were in a different context.

10. The jurisdiction of the King's Bench Division to issue a writ was stated by Atkin., L.J., in Rex v. Electricity Commissioners; Ex Parte London Electricity Joint Co. (1920) Ltd., (1924) 1 KB 171 at p. 205 in these terms:--

'Wherever any body of persons having legal authority to determine questions affecting the rights of subjects, and having the duty to act judicially, act in excess of their legal authority they are subject to the controlling jurisdiction of the King's Bench Division exercised in these writs.'

This decision has been approved by the English as well as Indian Courts as a satisfactory exposition of the scope and powers of a court of supervisory jurisdiction to issue a writ of certiorari. See Province of Bombay v. Khushaldas : [1950]1SCR621 ; Board of High School and Intermediate Education U. P. v. Ghanshyam Das Gupta : AIR1962SC1110 ; Sadhu Singh v. Delhi Administration : [1966]1SCR243b ; Dwarka Nath v. I. T. Officer : [1965]57ITR349(SC) . The aforesaid decisions lays down the following conditions to be complied with:

(1) That there should be a body of persons;

(2) That body of persons must have a legal authority to determine questions affecting the rights of subjects;

(3) That the body should be under a duty to act judicially; and

(4) That the body while so acting has acted in excess of legal authority.

11. Bodies which determine questions affecting the rights of citizens are courts of law or judicial tribunals strictly speaking and other bodies which are not courts. Bodies, which are not courts, can be divided into two classes: (1) bodies which are authorised by law; either common law or statutes, to decide rights of parties; (2) bodies which are private or domestic tribunals who derive their authority from contract i.e. from the agreement of parties. Such private bodies have no legal authority to decide questions of rights between the parties except in so far as and to the extent conferred by the parties themselves. It is for this reason that private bodies are not subject to the supervisory control of the High Court for the issuance of writ. The Bodies, namely, the courts or judicial tribunals and other bodies who have legal authority to determine the rights of parties are amenable to certiorari when they discharge judicial or quasi-judicial functions. A court has been defined as 'a place where justice is judicially administered.' It represents the judicial power of the soverign. See Shell Co. of Australia v. Federal Commr., 1931 AC 275 at p. 298. Other bodies who discharge quasi-judicial function also determine private rights with a binding force. See R. v. Dublin Corporation, (1878) 2 IR 371 at p. 376, R. v. Local Government Board, (1902) 2 Ir 349 at p. 373. It will thus be seen that the second ingredient in the statement of Lord Justice Atkin, namely, that the body should be having a legal authority depends upon whether the body has been invested with powers under the common law or some statute to deal with the rights of subjects.

12. The question, however, is whether in order to discharge a quasi-judicial function and determine rights with legal authority must a body be created under a Statute or would it be sufficient if a statute invests it with powers and imposes upon it duties to perform quasi-judicial functions. There can be two situations in which a body would be discharging quasi-judicial functions: (1) when a body is created under a Statute and (2) when a body already in existence is invested with powers and imposed with duties, and is required to function as a statutory body.

13. It is urged that a body which is not created under a Statute can never be subject to certiorari.

14. This question has been answered in the negative in Regina v. Criminal Injuries Com. Board, (1967) 2 QRD 864. It has been held in that case that a body not created under a statute and in that sense a non-statutory body may still be subject to the writ jurisdiction of the High Court if it possesses the requisite attributes which render inferior tribunals amenable to the supervisory control of the High Court. In that cast a Board was appointed under prerogative power to administer a scheme for compensating victims of violence. It was urged that the Board was a non-statutory body and the Crown in the ordinary exercise of prerogative could not invest any body of persons employed by them with any independent authority at law so as to impose upon them duties enforceable by law. The Board had only authority to carry on instructions and its duty was to the Crown alone. The Crown's instructions were not legislative.

The Board accordingly was an extra legal institution. It was consequently not subject to certiorari. Repelling this argument Lord Parket, C. J., observed that the exact limits of certiorari have never been and ought not to be specifically defined. They had varied from time to time being extended to meet changing conditions. He said 'We have, as it seems to me, reached the position when the ambit of certiorari can be said to cover every case in which a body of persons of public as opposed to a purely private or domestic character has to determine matters affecting subjects provided always that it has a duly to act judicially.'

15. Diplock, L. J., spoke thus:

'The jurisdiction of the High Court as successor of the court of Queen's Bench to supervise the exercise of their jurisdiction by inferior tribunals has not in the past been dependent upon the source of the Tribunal's authority to decide issues submitted to its determination, except where such authority is derived solely from agreement of parties to the determination. The latter case falls within the field of private contract and thus within the ordinary civil jurisdiction of the High Court. ......... Its recent history shows that as new kinds of tribunals have been created, orders of certiorari have been extended to them too and to all persons who under authority of the Government have exercised quasi-judicial functions. ......... If new tribunals are established by acts of Government, the supervisory jurisdiction of the High Court extends to them if they possess the essential characteristic upon which the subjection of inferior tribunals to which the supervisory control of the High Court is based.'

16. Ashworth, J., summing up the position of the Board observed thus:

'It can, therefore, be said that its existence and its functions have at least been recognised by Parliament which to my mind has a two-fold consequence: in the first place, it negatives any notion that the Board is a private tribunal and, secondly, it confers on the Board that I may call a public or official character. ......... I do not think that this court should shrink from entertaining this application merely because the Board had no statutory origin. It cannot be suggested then the Board had unlawfully usurped jurisdiction: It acts with lawful authority, albeit such authority is derived from executive and not from an act of Parliament. ...... I regard the duty to act judicially in a public as opposed to a private capacity, as the paramount consideration in relation to relief by way of certiorari.'

It will thus be seen that the origin of the body has not been considered as of primary importance. Two things which have been mainly emphasised are (1) the existence of legal authority and (2) the duty to act judicially. Considered from this angle we will have to see whether the Committee of management, the body in question fulfils the two requirements mentioned above. It was conceded before us that if this body or any other body had been established under Statute and it functioned in the manner that this body did there would have been no objection to certiorari issuing to it. We have, I therefore, to examine whether a body already in existence, if conferred with powers and imposed with duties and requited to act in a particular manner under the Statute would have the attributes of a body created under the statute and as such subject to certiorari. The Madras High Court answered the question in the affirmative. In Chidambaran v. R.P. Rathna Sarma : AIR1967Mad182 a resolution of a similar nature as in the instant case was challenged by means of a writ petition and an argument was raised that even if the order was illegal the High Court should not interfere with it as the scrutiny Committee was not a judicial or quasi-judicial tribunal statutorily entrusted with the right and duty to decide disputes between the parties. Kailasam, J., negativing the contention observed that the order was passed on the authority of power conferred by the rules framed under the Madras Co-operative Societies Act, 1961 and as such the scrutiny committee had a lawful authority to pass the order it did.

17. Rule 454 of the U. P. Co-operative Societies Rules, 1968 reads:

'It shall be the duty of the Committee of management of a Co-operative Society to ensure that no person incurring any of the disqualifications continues to hold office of a member of the Committee of Management As soon as the fact that a member is subject to any disqualification, whether it was incurred prior or subsequent to his being such member, comes to the knowledge of the Committee of management, the committee shall consider the matter in a meeting to be called for the purpose. A copy of the agenda of such meeting shall be served on the member (against whom action is proposed) either personally or by registered (acknowledgement due) post, where resolution for removal of the person concerned from the membership of the Committee has been passed for reasons of such disqualification, a copy of such resolution shall also be sent to the person concerned by registered (acknowledgement due) post and thereupon such member shall not be allowed to attend any meeting of the committee of management or to function as the member of the Committee of Management in any other way. The office held by such member shall be declared vacant. If that person feels aggrieved by such action, he may, within thirty days from the date of the receipt of the notice, seek arbitration under the provisions of the Act and the rules.'

18. The disqualifications are contained in Rule 453. The Committee under Rule 454 is under a duty to remove a disqualified member and declare the office vacant. The provisions of Rule 454 are imperative and compulsive in nature. The Committee has thus not only a power but a clear duty to investigate and decide questions affecting rights. Under Rule 454, the duty imposed upon the Committee and the powers conferred on it are clearly quasi-judicial in nature, if not judicial. It has to send a notice, consider the matter in a meeting, send a copy of the resolution to the person concerned who has been given a right to challenge the resolution by seeking arbitration under the Act. Such function is quasi-judicial (See A.K. Kraipak v. Union of India : [1970]1SCR457 and P.P. Virmani v. Stale Govt. : AIR1971All82 .

19. Section 29 of the Act provides that the management of every Co-operative Society shall vest in a Committee of Management constituted in accordance with the Act, the rules and the bye-laws which shall exercise such powers, and perform such duties as may be conferred or imposed.

20. The Committee of Management was constituted in accordance with the provisions of the Act and the rules and discharged the functions required thereunder. The Committee as such while discharging the functions under Rule 454 was acting under a statute as a body for all practical purposes, created under it. It fulfilled the requirements of a body to which a writ could issue.

21. It was not disputed that in exercise of the powers conferred by Section 130 of the U. P. Co-operative Societies Act, 1965 a specific rule could have been made appointing or providing for appointment of a body or tribunal vested with the duty and power to remove a disqualified person from holding or continuing to hold the office of a member of the Committee of Management of any primary or Central Society. Nor was it disputed that had any such rule been made it would have statutory force. That such a body or tribunal, if and when constituted or appointed under any such rule, would thus the a statutory body or tribunal admits to little doubt. On principle it is difficult to hold that the duty, function and power of such a body or tribunal would in any way be materially different from those of the Committee of Management under Rule 454. The Committee of Management at least for the limited purposes of Rule 454 must therefore be deemed to be an ad hoc body or tribunal spontaneously originating under statutory provision as and when any occasion or necessity arises for discharging the statutory duty imposed by that Rule When performing its duty under this Rule, the Committee of Management functions in a capacity basically different from its normal capacity as the body vested with the management of the affairs of the Society. It acquires a distinct identity separate and different from the identity of the Committee of Management as such. The Committee as such is constituted by all its members; butthe body which has to perform the duty imposed by Rule 354 is necessarily and essentially a body composed by members of theCommittee other than the alleged disqualifiedmember or members thereof. There is thusno valid reason to hold that no writ canissue to such a body under Article 226 of theConstitution. The first ground must, therefore fail.

22. The second ground involves two questions: one is a question of fact; the other is of law. The question of tact is whether at any relevant time the petitioner was a defaulter to the Primary Society in respect of a loan of Rs. 200/-. No finding on this question can be given without proper investigation and without taking evidence. The case, in our opinion, is not such as would justify the making of any such investigation or taking evidence. It may, besides, be mentioned that on this point a decision was given by the Committee of Management and unless such decision is found to be otherwise invalid, this Court cannot examine the correctness of that decision on merits. To do so would virtually amount to arrogating to itself appellate powers by the Court, The writ petition was liable to be and might have been dismissed for this reason. But the learned Single Judge was of the opinion that this question was wholly irrelevant because, in his view, no disqualification under Rule 453 (k) or bye-law (10) (ta) attached to a member of the Committee of Management of the Central Society, viz., the Central Bank, unless the member was a defaulter to such society or bank. Upon this view he quashed the impugned resolution. This brings us to the legal aspect of the second ground, involving construction of Rule 453 (k) and Bye-law No. 10 (ta).

23. Literally construed, Rule 453 (k) itself might not appear to be capable of any other meaning except that which commended itself to the learned Judge. The learned Advocate-General appearing for the appellants also conceded this. But, he submitted that in construing Rule 453 (k) a realistic approach should be made and the rule of harmonious construction should be adopted having regard to the relevant provisions of the Act and the Rules made thereunder. There is force in this argument. It may at the same time be mentioned that an alternative argument was also advanced by the learned Advocate-General based on Clause (o) of Sub-rule (1) of Rule 453. The said clause provides:--

'He is otherwise disqualified under any of the provisions of the Act or the Rules or of the bye-laws of the Society,'

It was contended that even it the interpretation of Clause (k) given by the learned Single Judge be assumed to be correct, the appellant still was liable to be removed from the office of a member of the Managing Committee by virtue of bye-law No. 10 (kha) of the bye-laws of the Central Bank concerned According to the learned counsel, if the court is satisfied that the appellant by virtue of the said bye-law became a disqualified person, then under Clause (o) of Rule 453 (1) he was not eligible to continue as a member irrespective of the fact as to whether he incurred any disqualification under Clause (k). We shall now proceed to examine the above submissions on merits.

24. In regard to the interpretation of Clause (k) of Rule 453 (1) it was submitted that 'a Central Bank' as defined in Section 2 (k) of the U. P. Co-operative Societies Act, 1965, means a 'Co-operative Society', the main object of which is to lend money to Co-operative Societies which are its ordinary members. Admittedly, in the instant case the Bank in question is a Central Co-operative Society which under Rule 2 (g) of the Rules means a Co-operative Society which has any other Co-operative Society as its ordinary member and which does not come under the category of a Primary Co-operative Society. Admittedly, also, the Bank does not come under the category of Primary Co-operative Society as defined in Clause (x) of Rule 2. Rule 44 (b) provides that no person who is an individual shall be admitted as an ordinary member in a Central Bank (other than U.P. State Co-operative Land Development Bank and an Urban Central Bank). Clause (c) of Rule 44 further provides that if a Society mentioned in Sub-rule (b) as on the date of coming into force of the Act, has individuals as its ordinary members, the Society shall, within a period of one year from such date or such further period as the Registrar may, for reasons to be recorded, allow for any Co-operative Society, adjust the membership to any other class mentioned in Sub-section (1) of Section 18 in accordance with the provisions of the bye-laws of the Society. In the instant case the appellant did not claim that be individually was a member of the Central Bank nor did he claim that the Bank had any individual as its ordinary member. From the aforesaid provisions it is clear that the Bank could not have advanced any loan to the appellant or to any other individual who was or might have been an ordinary member. Now if the rigid and literal interpretation of Clause (k) of Rule 453 (1), adopted by the learned Single Judge is accepted to be the correct interpretation, then practically for all purposes Clause (k) would remain a dead letter as far as the Central Banks are concerned. This might lead to an obviously anomalous position under certain circumstances. A delegate, who is an ordinary member of a primary society, may be a defaulter to that society for more than six months and, therefore, disqualified to be or to continue as a member of the Managing Committee of that Society. All the same, however, he would be entitled in spite of such default to continue as a member of the Managing Committee of the Central Bank. Such a position could not possibly have been contemplated either by the framers of the Act or the State Government which framed the Uttar Pradesh Co-operative Societies Rules, (968. We are, therefore, unable to accept the literal construction of Clause (k) of Rule 453 (1) given by the learned Single Judge.

25. The view expressed by us also finds support from Rules 85, 86 and 87 of the Co-operative Societies Rules. Rule 85, inter alia, provides that where a Co-operative Society is affiliated to any other Society, the former may appoint any one or more persons as delegates to represent it in the general body of the latter Society, provided that no person shall be appointed as delegate unless he is a member of the general body of the former Society, nor shall he suffer from any of the disqualifications laid down for delegates in the Rules. Rule 86 lays down that no Co-operative Society shall appoint any person as its delegate to represent the Society in another Co-operative Society if the person suffers from any of the disqualifications laid down in any of the Clauses (a), (b), (c), (d), (e), (f), (g), (i), (j), (k), (m), (n) and (o) of Sub-rule (1) of Rule 453. Rule 87 inter alia provides that a person who is already a delegate of a Co-operative Society shall cease to be such delegate if he incurs any disqualification referred to in Rule 86. Although a Central Bank does not have any individual as its ordinary member, yet for purposes of electing the Committee of Management it has a general body composed by delegates appointed by the affiliated Co-operative Societies. Under Rule 87 read with Rule 86 a delegate ceases to be a delegate on incurring disqualification amongst others under Clauses (k) and (o) of Rule 453 (1). Under Rule 453 (1) (h) no person shall be eligible to be or to continue as a member of the Committee of Management of any Co-operative Society (which will include a Central Bank also) if he is not a member of the general body of the Society. If the general body of a Central Bank, at least for purposes of electing the members of the Managing Committee, consists of the delegates appointed by the various affiliated Societies it is clear that a delegate elected as a member of the Managing Committee of the Bank will have no right to continue as such a member if he ceases to be a delegate under Rule 87 read with Rule 86. The disqualification as a delegate may be incurred under any of the clauses of Sub-rule (1) of Rule 453 mentioned in Rule 86, but the legal consequence of such disqualification will be that he will cease to be a member of the general body of the Central Bank. For this reason also the person concerned will be liable to be removed from the membership of the Managing Committee of the Bank under. Rule 454. The position, therefore, is that if in reality the appellant was a defaulter to the Primary Society of which he was an ordinary member be was a disqualified person,not eligible to be either appointed or to continue as a member of the Committee of the Management of the Bank under Rule 453. He was, therefore, liable to be removed under Rule 454. Indeed it was the duty of the Committee of the Management itself to see to it that the appellant as a disqualified person no longer remained a member of the Committee.

26. Bye-law No. 10 (ta) already quoted hereinabove is quite explicit. It provides that no person shall be eligible to be elected or to continue as a member of the Managing Committee of the Bank, who has been a defaulter in respect of a loan taken from the Bank or in respect of a loan taken from any Society whom he represents as a delegate, the minimum period of default being six months. The impugned resolution itself mentions that the appellant was a disqualified person both under Clause (k) of Rule 453 (1) and bye-law No. 10 (ta) of the Bye-laws. Therefore, if in fact the appellant was a defaulter for a period of at least six months to the primary society of which he was a member as also a delegate, there is no escape from the conclusion that he was a disqualified person by virtue of Clause (o) of Rule 453 (1) and as such liable to be removed from the office of a member of the Managing Committee of the Bank under Rule 454. Having regard to the clear language of the bye-law in question we find it difficult to agree with the interpretation of this bye-law by the learned Single Judge. The necessity of such a bye-law would be apparent if it is viewed in the correct perspective. As has already been mentioned a Central Bank has no individuals as members, and ordinarily such a Bank does not advance any loan to individuals. It was for this reason necessary to have a bye-law comprehensive enough to be applicable not only to a defaulter to the Bank itself but also to a defaulter to a primary Society which, had appointed the person in question as a delegate to represent the Society and to participate in the election for the members of the Managing Committee of the Bank. In our opinion, therefore, the appellant, in case he actually was a defaulter to the Primary Society in question at least for a period of six months, was a person disqualified both under Clause (k) of Rule 453 (1) as also Clause (o) thereof read with bye-law No. 10 (ta) of the Bye-laws.

27. The next question is as to whether the contesting respondent was or is entitled to any relief. It was urged by the learned Advocate-General appearing for the appellants that the question whether the contesting respondent was a defaulter or not is a question of fact, the correctness of which cannot be gone into in a writ petition nor in Special Appeal. The proposition is generally correct, but a contention has been raised on behalf of the said respondent that in the instant case the members of the Managing Committee passed the impugned resolution without complying with the mandatory procedure laid down by that rule itself, and that they also acted in clear violation of the principles of natural justice. It was urged that the allegation that the respondent was a defaulter to the primary Society might or might not be true, but, in any event, before taking a decision in the matter It was incumbent on the Committee to give notice to him, as required by the Rule itself and also to afford him a reasonable opportunity of stating his case and to show that in reality he was not a defaulter. From the facts already slated above it is apparent that the notices sent to the respondent by registered post were delivered to him several days after the date fixed for the meeting. From a perusal of the proceedings of the meeting dated 21-10-1971, of which a copy was annexed as Annexure 7 to the writ petition, as also the relevant averments made in the various affidavits, counter-affidavits and rejoinder-affidavits, it seems to us that no such notice was given to the respondent either personally or through registered post as is required under Rule 454. The question whether he was or was not a defaulter had to be objectively considered and decided. For this reason it was essential that prior notice should have been given to him to afford him a reasonable opportunity to defend himself. This to our mind was not done. The impugned resolution removing the respondent from the office of membership of the Managing Committee as also the office of the Chairman of the Bank is, therefore, liable to be quashed, although on a ground different from the one which commended itself to the learned Single Judge.

28. The last question which remains for consideration is whether the writ petition was liable to be dismissed on the ground that an alternative and equally efficacious remedy was available to respondent No. 10. This contention was raised before the learned Single Judge also. The learned Single Judge was of opinion that having regard to all the circumstances of the case the writ petition should not be dismissed and the petitioner denied the relief solely on the ground that he had an equally efficacious and alternative remedy. Before us it was however urged that the contesting respondent by his own conduct had allowed the alternative remedy available to him to lapse, and that, therefore, also no discretionary relief ought to be granted to him. An alternative remedy is not an absolute bar to granting a relief under Article 226 of the Constitution. If the learned Single Judge had dismissed the writ petition on this ground no interference would have been called for in a Special Appeal. Here the learned Judge, however, in spite of the objection considered the case to be a fit one for grant of relief under Article 226. We do not see any special reason to interfere with the exercise of discretion in the matter by the learned Single Judge, specially when the respondent has successfully made out a case for grant of suitable relief. We are, therefore, unable to accept the third objection raised by the learned counsel for the appellant.

29. In the result the appeal fails and is dismissed. But having regard to the circumstances of the case we direct the parties to bear their own costs throughout.


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