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Padma Charan Samantsinghar Vs. the Registrar of Co-operative Societies, Bhubaneswar and ors. - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtOrissa High Court
Decided On
Case NumberOriginal Jurn. Case No. 444 of 1980
Judge
Reported inAIR1981Ori150; 50(1980)CLT527
ActsOrissa Co-operative Societies Act, 1963 - Sections 32(1) and 32(2)
AppellantPadma Charan Samantsinghar
RespondentThe Registrar of Co-operative Societies, Bhubaneswar and ors.
Appellant AdvocateG. Rath, Adv.
Respondent AdvocateAddl. Standing Counsel
DispositionApplication dismissed
Cases ReferredR. R. Verma v. Union of India.
Excerpt:
.....must, therefore, fail. in case the registrar is satisfied that for the efficient working of the society the committee of administrators must change, the appropriate power must be assumed in him to make necessary change in the arrangement. administering the affairs of a bank like the one in question with a large volume of transaction is not a simple job. unless the registrar is allowed, subject to the requirement to act justly and fairly, to act in a dynamic manner, the trust imposed in him by the statute may not be effectively discharged. in the premises, we are not satisfied that the impugned order is open to attack on the ground that petitioner has not been given an opportunity of being heard before the committee was reconstituted as a result of which he has been kept away..........instructions are binding. in case the registrar is satisfied that for the efficient working of the society the committee of administrators must change, the appropriate power must be assumed in him to make necessary change in the arrangement. depending on the situation in a given case, the change may be frequent. a conscientious registrar upon seeing the functioning of the committee of administrators may bona fide think of alteration in the management. today's problems are complex; administering the affairs of a bank like the one in question with a large volume of transaction is not a simple job. unless the registrar is allowed, subject to the requirement to act justly and fairly, to act in a dynamic manner, the trust imposed in him by the statute may not be effectively discharged. to.....
Judgment:

Misra, J.

1. The Managing Committee of the United Puri-Nimapara Centra) Co-operative Bank (opposite party No, 15) was superseded under Section 32 (1) of the Orissa Co-operative Societies Ad (hereinafter called the 'Act') by order dated 1-12-1978, and the Colletcor of Purj was appointed as the Administrator. In August, 1979, the Registrar of Co-operative Societies asked for the consent of the petitioner to be a member of the Committee of Administrators for the said Bank and after petitioner consented, on 31st of August, 1979, as per Annexure 3, a Committee of Administrators with seven members including the petitioner was constituted in place of the Collector. In the Committee petitioner who was then a sitting member of Parliament and two members of the State Legislature were included. On 7th of March, 1980, vide Annexure 4, the Registrar reconstituted the Committee of Administrators by dropping the petitioner as also the two other legislators and in the reconstituted Managing Committee there were eleven members in all with the Deputy Registrar of Co-operative Societies, Bhubaneswar Division, as the Chief Administrator. Four members were common in both the Committees and in place of the three elected representatives of the people included in the first Committee of Administrators seven others were taken in the reconstituted Committee of Administrators. Challenge in this application is to the reconstitution of the Committee of Administrators and dropping of the petitioner from the reconstituted body without complying with the procedure laid down in Section 32 (1) of the Act and alternately on the ground that without affording reasonable opportunity of being heard, the petitioner has been excluded from the Committee.

According to the petitioner under Section 32 (1) of the Act, after the Committee is removed, the Registrar has three alternatives:--

(a) to appoint a new committee consisting of one or more members of the Society in its place;

(b) to appoint one or more Administrators who need not be members of the Society; or

(c) to appoint any other Society with its consent, to manage the affairs of the Society for a specified period. In the instant case, action had been taken under Clause (b) to appoint a Committee of Administrators. Sub-section (2) of that section provides:-- 'The Committee or the Administrator or Administrators or the Society so appointed shall, subject to the control of the Registrar and to such instructions as he may from time to time give, have power to exercise all or any of the functions of the committee or of any officer or the society and take all such actionsas may be expedient in the interests of the society and shall be deemed for allpurposes of this Act and the rules and bye-laws to be the Committee of such society.' (underlining is ours). Relying on the provision of Sub-section (2), the petitioner has contended that the Committee of Administrators which is deemed to be a regular Committee of Management could be removed only by complying with Sub-section (1) and since that has not been done, the reconstitution is contrary to law. It has also been contended as an alternative argument that even if Sub-section (1) is not attracted and compliance thereof was not a prerequisite for reconstitution of the Committee of Administrators, since petitioner had been conferred with certain advantages by his appointment as a Member of the Committee of Administrators in terms of Annexure 3, he could not be deprived of the same without compliance of the rules of natural justice. Fairplay required that he should have been told and heard in relation to the matter of his removal from the Committee.

2. On behalf of the opposite parties 1 to 4, a counter-affidavit has been filed in support of the action taken and it has been contended that the order under Annexure 4 is not open to challenge on either count.

3. Section 32 (1) of the Act authorises the Registrar to remove the Committee of Management on the grounds specified therein. 'Committee' has been defined in Section 2 (c) of the Act to mean,

'...... the managing committee of asociety by whatever name called, to which the management of the affairs of the society is entrusted by or under this Act or by the bye-laws of the society.' Admittedly, a new Committee had not been set up when the first Committee was removed and the Registrar bad chosen to take action under Section 32 (1) (b) of the Act first in appointing the Collector as the sole Administrator and later by appointing a Committee of Administrators and replacing the Collector by the Committee. While Clause (a) indicates that the Committee should consist of one or more members of the Society, Clause (b) authorises appointment of one Administrator or more Administrators who need not be members of the Society. Sub-section (2) does not have the effect of converting the Committee of Administrators to a Committee in terms of the bye-laws. Sub-section (1) must be confined tothe 'Committee' in which under the Act or the Bye-laws, the management of the affairs of the society vests. The Administrator or the Committee of Administrators is not such a committee. The effect of Sub-section (2) is only in regard to exercise of powers and the deeming provision therein cannot be extended to make the Committee of Administrators a Committee referred to in Sub-section (1) and in terms of the definition in Section 2 (c) of the Act. The first contention advanced by Mr. Rath for the petitioner must, therefore, fail.

4. Annexure 3 is the order of the Registrar constituting the Committee of Administrators. The material part of it reads thus:--

'In exercise of powers under Section 32(1) (b) of the Orissa Co-operative Societies Act, 1962, 'I, Shri S. B. Mahapatra, I.A.S., Registrar of Co-operative Societies, Orissa, Bhubaneswar, do hereby appoint a Committee of Administrators consisting of following persons to manage the affairs of the United Puri-Nimapara Central Co-operative Bank Ltd., Puri in place of Collector, Puri, who was appointed to act as Administrator for the said Bank in this office Order No. 27953 dated 26-7-1979.....'

No tenure was fixed in the order constituting the Committee. Obviously the term of office of the Committee of Admin-isrators is a temporary one intended to operate during the interregnum. In Section 32 (1), a limit has been indicated of the tenure, namely it should not exceed two years in the first instance and the said period may at the discretion of the Registrar be extended from time to time so however that the aggregate period does not exceed four years. It was open to the Registrar to indicate the tenure within the limit indicated by statute while constituting the Committee of Administrators, but no such specification had been made. It is, therefore, clear that by reconstituting the Committee of Administrators and dropping the petitioner from the Committee, the duration of office has not been curtailed and no vested right of the petitioner has been affected.

Applicability of the contention that the rules of natural justice have been violated has to be examined in this background. There can be no dispute that even administrative action must be conditioned upon reasonableness as pointed out in the case of Anisminic Ltd. v. Foreign Compensation Commission, (1969) 1 All ER. 208. The concept of Rule of Lawwould lose its vitality if the instrumentalities of the State are not charged with the duty of discharging the functions in a fair and just manner. In this writ application, there is no allegation of mala fide. We have, therefore, to proceed on the footing that the order is not vitiated by absence of fairplay and the action is not motivated. During the absence of the regular Committee of Management, the Registrar takes over the responsibility of administering the affairs of the Society and on his behalf an agency has to be created in terms of Clause (a), (b) or (c) of Section 32 (1) of the Act to discharge that responsibility. The agency is under the direct control of the Registrar and his instructions are binding. In case the Registrar is satisfied that for the efficient working of the Society the Committee of Administrators must change, the appropriate power must be assumed in him to make necessary change in the arrangement. Depending on the situation in a given case, the change may be frequent. A conscientious Registrar upon seeing the functioning of the Committee of Administrators may bona fide think of alteration in the management. Today's problems are complex; administering the affairs of a Bank like the one in question with a large volume of transaction is not a simple job. Unless the Registrar is allowed, subject to the requirement to act justly and fairly, to act in a dynamic manner, the trust imposed in him by the statute may not be effectively discharged. To concede to a Committee of Administrators a right of being heard as a condition precedent to its dissolution, in our opinion, would be an undue fetter on the Registrar's power of management. In the instant case by reconstituting the Committee of Administrators he has only exercised that power. In the absence of challenge to the recon-stitution on the grounds of mala fides, we do not think, the order of reconstitution is open to attack for want of compliance of rules of natural justice. The reconstitution has not affected any vested right of the petitioner and has been done in exercise of powers vested in the Registrar. That in such circumstances rules of natural justice need not be complied with is supported by a recent decision of the Supreme Court in the case of R. R. Verma v. Union of India. (1980) 3 SCC 402 : (AIR 1980 SC 1461 at pp. 1463, 1464). The Court pointed out:--

'..... We do not think that the principle that the power to review must beconferred by statute either specifically or by necessary implication is applicable to decisions purely of an administrative nature. To extend the principle to pure administrative decisions would indeed lead to untoward and startling results. Surely, any government must be free to alter its policy or its decision in administrative matters. If they are to carry on their daily administration they cannot be hidebound by the rules and restrictions of judicial procedure though of course they are bound to obey all statutory requirements and also observe the principles of natural justice where rights of parties may be affected.....'

We have already pointed out that in the instant case, no right of the petitioner has been affected. In the premises, we are not satisfied that the impugned order is open to attack on the ground that petitioner has not been given an opportunity of being heard before the Committee was reconstituted as a result of which he has been kept away therefrom. The second ground of attack is also without force.

5. The writ application must accordingly fail and is dismissed, but without costs,

Das, J.

I agree.


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