1. The petitioner was a candidate at the election to be held for the directorship of respondent No. 1 (which is a Co-operative Bank) for the year 1972-73. The Board of directors of respondent No. I Bank which is hereinafter referred to as 'the Society' consists of nine Directors. One-third of them retire every three years. In 1972-73 three vacancies arose on account of retirement by rotation and were to be filled in. On 14th August 1972 the petitioner filed big nomination paper for being elected to one of the vacancies which had occurred an the Board of Directors of the Society. At the time of the 9crutiny of his nomination paper objection was raised to its validity. That objection was upheld by the Society by its resolution dated 16th August 1972 and the petitioners nomination paper was rejected.
2. Thereupon the petitioner filed Arbitration Case No. 1 of 1972 before the District Registrar of Baroda in which he challenged the rejection of his nomination paper. The District Registrar referred the case to the Board of Nominees. The petitioner sought an interim injunction in those proceedings. He obtained it. Respondent No. 2 challenged that order in a revision application which he filed before the Co-operative Tribunal. By its order dated 1st March 1973 the Tribunal dismissed the revision application. Thereafter when the Arbitration Case proceeded further before the Board of Nominees, respondent No. 4 applied to the Chairman of the Board. of Nominees to raise additional issues. By its order dated 22nd June 1973 the Chairman of the Board of Nominees dismissed that application. That order was challenged in a revision application which was filed before the Co-operative Tribunal. it appears that the Tribunal partly allowed that revision application and directed Chairman of the Board of Nominees to recast issue No. 2 and to try it. Thereupon when the arbitration case proceeded further before the Board of Nominees, respondent No. 4 again applied to the Chairman of the Board of Nominees and contended that the arbitration case was not maintainable because the rejection of the nomination paper could be challenged only after the election was held and that it could not be challenged in any proceedings instituted before the election was held. He also prayed for trying that issue as a preliminary issue. The Chairman of the Board of Nominees granted that application and ordered. issue No. 2A to be tried as a preliminary issue.. After having tried, issue No. 2A as a preliminary issue it was held by the chairman of the Board of Nominees that the dispute which the petitioner raised was not entertainable before the election wm held. The arbitration case which the petitioner filed was, therefore, dismissed and the interim injunction granted to him was vacant The petitioner appealed against that decision to the Co-operative TribunaL In that appeal he raised two contentions. His first contention was that the Chairman of the Board of nominees had become functus officio on account of the fact that an the date when he made the final order in the arbitration case his appointment had expired and that therefore, he had no authority to decide the case. The second contention which was raised 'in that appeal was based upon the merits of the case. It was contended that the arbitration case which the petitioner had filed was maintainable because such an election dispute could be entertained before the election was held. The Co-operative Tribunal rejected both these contentions and dismissed the appeal.
3. The petitioner has filed this petition both uncles Articles 227 and 226 of the Constitution. In so far as the petition is filed under Article 227, the petitioner challenges the correctness and legality of the order made by the Co-operative Tribunal. In so far as it is filed under Article 226, he seeks relief against the rejection of his nomination paper
4. So far as the first contention raised by the petitioner is concerned, it is necessary to examine a few facts It is not in dispute before me that the Chairman of the Board of Nominees made the final order in the arbitration cage on 11tk March 1974. Mr. Patel has argued that the appointment of the Chairman of the Board of Nominees expired on 28th February 1974. According to, him therefore, the Chairman of the Board of Nominees had no authority or power on 11th March 1974 to make, the order which he made.
5. My attention has been invited to a few resolutions of the Government of Gujarat. The resolution dated 23 rd April 1973 shows that the posts of the Nominees of the Registrar of Co-operative Societies, Baroda Division were continued in existence until 28th February 1974. The next order which was made thereafter was by the Registrar of Co-operative Societies, Gujarat State on 22nd March 1974. By that order the Registrar continued in existence the temporary posts referred to above until 31st March 1975. Thereafter on 3rd April 1974 the Government of Gujarat passed a. resolution by which they continued a existence the posts referred to above from 1-3-1974 to 28-2-1975. These three documents which have been shown to me make it, clear that after the posts of the Registrar's nominees, Baroda Division had ceased to exist an 28th February 1974 the first order which was made was on 22ad March 1974 by the Registrar of Co-operative Societies. I am assuming for the purpose of this case that the Registrar of Co-operative Societies had the Authority to continue in existence the temporary posts of the Registries Nominees for Baroda Division. When the Government resolution dated 23rd April 1973 is read in light of the Registrar's order dated 22nd March 1974 it becomes quite clear that the temporary posts of Registrar's Nominees for Baroda Division ceased to exist on 1st March 1974. There was no order made or resolution passed by the competent authority on or before 1st March 1974 continuing in existence the aforesaid posts. It appears from the aforesaid, order made by the Registrar of Co-operative Societies that on 22nd March 1974 he passed an order by which he continued in existence the aforesaid temporary posts from 1st March 1974 to 31st March 1975. It is quite clear that the aforesaid temporary posts were continued in existence retrospectively from 1st March 1974 by the order made by the Registrar of Co-operative Societies on 22nd March .1974. Similarly, Government resolution dated 3rd April 1974 continued in existence the aforesaid posts retrospectively from 1st March 1974 until 28th February 1975. It is not necessary for me to decide for the purpose of this case whether the Registrar of Co-operative Societies or the Government of Gujarat had the authority to make an order or pass a resolution continuing in existence the aforesaid posts with retrospective affect from 1st March 1974. I am only concerned with the validity of the order made by the chairman of the Board of Nominees. These documents to which my attention has been invited make it clear beyond any doubt that on Ist March 1974 the temporary posts of the Registrar's Nominees for Baroda Division had ceased to exist. Obviously, therefore, the Nominees including the Chairman of the Board of Nominees were not holding any post on 1lth March 1974 when the Chairman made the order. If ex facie the Chairman made the order on 11th March 1974 when he bad no authority to make that order and when he .held no post whatsoever, can it be said that by virtue of a executive order passed by the Registrar of Co-operative Societies on 22nd March 1974 and by virtue of the Resolution passed by the Government of Gujarat on 3rd April 1974 a judicial or a quasi-judicial order which was made by the Chairman and which was otherwise void and of no effect was validated The Registrar of Co-operative Societies and his Nominees including the Chairman of the Board of Nominees exercise the judicial power of the State in respect of matters placed under their exclusive jurisdiction. No other Court can exercise judicial power in respect of those matters. That is the effect of Section 166 of the Gujarat Co-operative Societies Act, 1961. It is impossible for me to think that what was void as a judicial or quasi-judicial decision determining lis between the parties could be validated by an executive order such as me made by the Registrar of Co-operative Societies or by the resolution passed by the Government of Gujarat. Whatever other effect of the order made by the Registrar or the resolution passed by the Government may be, I cannot inject force of: law into an act which was ab inito void and devoid of all authority. No provision of law has been shown to me to support the contention that an executive order made by the Registrar of Co-operative Societies or a resolution passed by the State Government can retrospectively inject into a void judicial order force of law and validity. In my opinion, therefore, the order which the Chairman of the Board of Nominees made was a void order because he had no authority under law to make that order at the time when he made it. In my opinion, the Tribunal was in error in taking the contrary view. The order made by the Chairman of the Board of Nominees on 11th March 1974 by which he dismissed the petitioner's Arbitration case was therefore completely void and lacked all jurisdiction and authority and must be quashed.
6. So far as the second contention raised by Mr. Patel is concerned. I find quite a great deal of substance therein. It has been held by the Chairman of the Board of Nominees and the Tribunal that By-law 129 (AA) of the Society is void and that, therefore, the Registrar or his Nominees could not have entertained a dispute against the rejection of the nomination paper of the petitioner before the election was held. After hearing the parties on this aspect of the case I am of the opinion, for the reasons which I am recording hereinafter, that it is not necessary for me to decide whether By-law 129 (AA) of the Society is void or not. Section 96 of the Gujarat Cooperative Societies Act confers upon the Registrar or his Nominees jurisdiction to entertain a dispute, inter alia, touching the constitution of a society. In the instant case. the election of the Board of Directors of the Society touches the very constitution of the Society. It may be pointed out that Section 74 of the Gujarat Co-operative Societies Act, 1961, vests the management of a co-operative society in its Committee or in its Board of Directors. Section 96 does not lay down anything to confine the disputes contemplated by it to disputes, so far as elections are concerned, which can be entertained only after the elections are held. The language of sub-section ( 1) of Section 96 is wide enough to include within its ambit disputes arising out of rejection of nomination papers even if they are raised before the election is held If sub-section (1) of Section 96 confers jurisdiction, as it in my opinion does, upon the Registrar to entertain a dispute touching the constitution of a society, it necessarily confers upon him the jurisdiction to entertain a dispute relating to the rejection of a nomination paper even before the election is held. To take any other view is to unnecessarily narrow down the wide amplitude of sub-section (1) of Section 96. If it was intended by the legislature that in matters of election, disputes cannot be raised except after the elections are held, the legislature could have certainly said so and made it clear. On the contrary, so far as election disputes are concerned, if it touches the constitution of a society it is entertainable at any stage-whether before the election is held or after the election is held. Rejection of a nomination paper of a candidate affects the verv election which constitutes the very substratum of a society therefore, in my opinion, touches the constitution of a society.
7. My attention has been invited to Section 97(1)(d) of the Gujarat Co-operative Societies Act, 1961 which provides as under:-
'Notwithstanding anything contained in the Indian Limitation Act, 1908, hut subject to the specific provisions made in this Act, the period of limitation in the case of a dispute referred to the Registrar under Section 96 shall-
............ .... ....
(d) when the dispute is in respect of an election of any office-bearer of a society be two months from the date of the declaration of the result of such election,'
On the basis of this provision it has been argued before me that since it expressly provides for a period of limitation for entertaining election disputes after the election has been held and the result has been declared it by necessary implication excludes the entertainment of election disputes prior to the holding of the election or declaration of the election result
8.. In support of that argument, reliance has been placed on the Division Bench decision of the High Court at Bombay in Madhukar Ganpatrao Somvanshi v. Sheshrao Narayanrao Birada : AIR1972Bom129 . It was a case under the Maharashtra Co-operative Societies Act, 1961. The High Court at Bombay was considering the scope of Section 91 of that Act. The provisions of Section 91 of the Maharashtra Co-operative Societies Act 1961 are similar to the provisions of See. 96 of the Gujarat Co-operative Societies Act, 1961. In that decision reliance has been placed upon the decision of the Supreme Court in Dr. Narayan Bhaskar Khare v. Election Commission of India : 1SCR1081 and upon another decision of the Supreme Court in N. P. Ponnuswamy v. Returning Officer, Namakkal Constituency : 1SCR218 . After having examined the principles laid down by the Supreme Court in those decisions the High Court at Bombay held that the application made by the respondent No. I to that case contending that the nomination paper of the petitioner and respondents Nos. 2 to 5 to that case were wrongly accepted could not be entertained before the declaration of the result of the election. This decision was cited before Mr. Justice J. B. Mebta in Lambha Vividh Karyakari Seva Sabakari Mandli Ltd. Ahmedabad v. District Registrar, Co-operative Societies (Rural), Ahmedabad (1973) 14 Gui LR 786. After having referred to that decision it has been observed by the learned judge that in election matters utmost expedition is required and that when the provision for filing an election petition has been made after the election has taken place in order to raise a dispute as to the validity of an election, it is very doubtful whether a by-law can be made by society for the purpose of allowing disputes to be raised against wrongful rejection or wrongful acceptance of the nomination paper prior to the holding of the election and the declaration of the result of the election. The learned judge in that decision was more concerned with he inconsistency of such a by-law. I have already stated in the foregoing parts of this judgment that it is not necessary for me to examine the validity of By-law 129 (AA) of the Society because, in my opinion, sub-section (1) of Section 96 is wide enough to cover such a dispute. However, it has been observed by Mr. justice J. B. Mehta in that decision that it was not necessary for him to conclude the controversy though, in his opinion, the remedy against a wrongful rejection or wrongful acceptance of the nomination paper prior to the holding of the election and the declaration of the result was highly debatable. Since no final and binding view has been expressed by Mr. Justice J. B. Mehta in that decision it has become necessary for me to go into this aspect and to examine it more deeply.
9. The decision of the High Court at Bombay in Madhukar's case AIR 1972 Born 129 (supra) is based upon two Supreme Court decisions to which I have referred.. Both those decisions were rendered under the Representation of the People Act, 1951. It appears to me that the scheme of the Representation of the People Act, 1951 in this behalf is different from the scheme of the Gujarat Co-operative Societies Act, 1961. Clause (b) of Article 329 of the Constitution provides as follows-,-
'Notwithstanding anything in this Constitution-
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(b) no election to either House of Parliament or to the House or either House of the Legislature of a State shall be called in question except by an election petition presented to such authority and in such manner as may be provided for by or under any law made by the appropriate Legislature.'
In pursuance of this constitutional provision certain provisions have been made in the Representation of the People Act, 1951. It is necessary to refer to Sections 80 and 100 of that Act. Section 80 provides as follows-.-
'No election shall he called in question except by an election petition presented in accordance with the provisions of this Part.' Sub-section (1) of Section 100 of that Act, inter alia, provides as follows:-
'Subject to the provisions of sub-section (2) if the High Court is of opinion-
(c) that any nomination has been improperly rejected; or
(d) that the result of the election, in so far as it concerns a returned candidate, has been materially affected.
(i) by the improper acceptance of any nomination
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the High Court shall declare the election of the returned candidate to be void. The aforesaid two sections of the Representation of the People Act, 1951 when read in light of clause (b) of Article 329 of the Constitution make it abundantly clear that out of its anxiety to prevent the holding up of the progress of the elections provision has been made for not entertaining any election dispute against improper rejection or improper acceptance of a nomination paper before the election has been held and the result has been declared. It is in that context that Section 100 of the Representation of the People Act, 1951 expressly enables an aggrieved candidate to make in his election petition filed after the election has been held the improper rejection of a nomination paper or the improper acceptance of a nomination paper a ground for challenging the validity of the election. It is this scheme of election disputes which has led the Supreme Court in the aforesaid two decisions to lay down the aforesaid principle. I find no such scheme in the matter of election disputes in the Gujarat Co-operative Societies Act, 1961. Sub-section (1) of Section 96 is wide enough to confer jurisdiction upon the Registrar to entertain disputes either before or after the election is held. There is no other section in that Act which narrows down or limits the wide amplitude of that jurisdiction. It cannot, therefore, be cut down by applying the principle laid down by the Supreme Court in the aforesaid two decisions in the context of an altogether different scheme of election disputes laid down by the Representation of the People Act, 1951. 1 am, therefore, unable to apply to this case the principle laid down by the High Court at Bombay in Madhukar's case : AIR1972Bom129 (supra).
10. So far as Section 97(1)(d) is concerned, there are two aspects which are required to be considered in order to determine whether it controls sub-section (1) of Section 96 so as to exclude there from election disputes raised prior to the holding of the elections. The first aspect which conspicuously strikes one who reads that section is that it has been enacted in order to provide a period of limitation. It has not been enacted for the purpose of cutting down the nature of dispute described by sub-section (1) of Section 96. The second aspect which emerges from Section 97(1)(d) is that the period of two months from the date of the declaration of the result of the election prescribed by clause (d) of sub-section (1) of Section 97 is in relation to an election dispute raised after the election has been held. It is extremely difficult for me to imagine that a provision which enacts a period of limitation during which an election dispute can be raised after the election has been held and the result has been declared excludes by necessary implication the entertainment of an election dispute at an earlier stage, that is to say, before the election has been held. I am unable to read in the statutory provision relating to limitation the exclusion of something from some other section to the subject matter of which it has no reference. In my opinion, therefore, both the Chairman of the Board of Nominees and the Tribunal were in error in holding that the Arbitration case filed by the petitioner was not maintainable. Their decisions are, therefore encumbrances, or liable to be quashed and set aside.
11. That however does not solve the problem. Rightly or wrongly the working of the society has been carried on for well nigh two years without holding any fresh elections on account of the pendency of the present arbitration case and on account of several interlocutory proceedings having been taken out by the parties. The facts of the case which I have stated above present a dismal picture of tardy litigation in which one party has been trying to vie with another in prolonging the proceedings .It appears to me that no one is interested in the earlier decision of the dispute. Therefore, if I quash on the grounds stated above the impugned decisions of the, Chair man of the Board of Nominees and the Co operative Tribunal and send back the matter to the Board of Nominees, it would be allowing to the parties another spell for protracting; the litigation to which they can resort with in4minity. I do not propose to do so. I have, therefore, thought fit to decide the question which Mr. Patel has raised before me in the petition in so far as it has been filed under Article 226 of the Constitution.
12. Mr. Patel has contended before me that the rejection of the nomination paper of the petitioner was wrongful. My attention bas been invited to the proceedings of the society by which the nomination paper of the petitioner was rejected. It appears to me from that proceeding that the nomination paper of the petitioner was rejected on the ground that he had been an employee of Bank of Baroda a nationalized Bank and had not produced from his employer a no-objection certificate for the purpose of contesting elections to the Board of Directors of the Society and becoming a Director thereof. Mr. Sakore who appears for respondents Nos. 2 to 4 has very strenuously tried to support that decision of the Society. The requirements of a valid nomination have been laid down in the By-laws of the Society which are in Marathi. By-law 55 lays down the eligibility of a can didate to contest elections to the Board of Directors of the Society. So far as these By-laws are concerned, all the parties appearing before me have agreed that By-law 55 is the only relevant By-law for the purpose of the present case. An agreed translation of that By-law has been furnished to me. It reads thus:
'A member who holds 25 shares or more and
(1) who holds in Baroda city immovable property worth at last Rs. 6000/- free from encumbrances, or
(2) who is paying income-tax or
(3) who has passed the S. S. C. Examination of Gujarat S. S. C. Board or any other equivalent recognized examination and
(4) who has no unsecured loan will be eligible to become a Director.'
There is an exception to that By-law. There is also an explanation to it. None of them is relevant for the purpose of the present case. It is quite clear, therefore, that this By-law of the Society which lays down the test of eligibility of a candidate to contest elections to the Board of Directors of the Society does not require him to produce a no-objection certificate from his employer irrespective of whether Government, Corporation, a nationalized Bank or anyone else is his employer. Under Section 168 of the Gujarat Co-operative Societies Act, 1961 Gujarat Co-operative Societies Rules, 1965 have been made. Rule 32 which lays down the qualifications for the members of the Committee (in this judgment I have referred to the Committee as the Board of Directors) provides thus:
'(1) Every member of a society who is entitled to vote shall be eligible for appointment as a member of a committee thereof if-
(a) be is not in default in respect of any loan taken by him for such period as is specified in the bye laws, or
(b) he has not directly or indirectly any interest in any subsisting contract made with the society or in any property sold or purchased by the society or any other transaction of the society except in any investment made in or any loan taken from the society, or
(c) if he is not otherwise disqualified for appointment as such member.
(2) Notwithstanding anything contained in sub-rule (1), in case of societies dispensing credit, no person who does money lending business shall be eligible for appointment as a member of the Managing Committee.'
A bare perusal of this rule makes it quite clear that the production of a no-objection certificate from his employer is not necessary for the valid nomination of a candidate for being elected as a Director of the Society.
13. Mr. Majmudar and Mr. Sakore have next invited my attention to the Banking Regulation Act, 1949. Reliance has been placed upon Sections 10, 10A, 10B, 10C and 10D of the Banking Regulation Act, 1949, in support of the contention that it is necessary for an employee of a nationalized bank (the petitioner is an employee of the Bank of Baroda a nationalized Bank to produce a no-objection certificate from his employer for the purpose of contesting elections to the Board of Directors of a society which is a co-operative banking company. I have not found anything in the aforesaid sections to warrant even the slightest inference that there is any such requirement for a candidate who is an employee of a nationalized Bank to fulfill. However, the story does not end there so far as the Banking Regulation Act, 1949 is concerned. By the Banking Laws (Application to Co-operative Societies) Act, 1965 Part V was inserted in the Banking Regulation Act, 1949. Section 56 is the first Section with which Part V of the Banking Regulation Act, 1949 opens. It, inter alia, provides that the provisions of the Banking Regulation Act, 1949, as in force for the time being, shall apply to, or in relation to, co-operative societies as they apply to, or in relation to, banking companies subject to the modifications stated therein. This opening part of Section 56 makes it quite clear that by virtue of the Banking Laws (Application to Co-operative Societies) Act, 1965 the Banking Regulation Act, 1949 was applied to co-operative societies carrying on banking business. However, the Banking Regulation Act, 1949 was applied with certain modifications which Section 56 contains. Clause (g) of Section 56 in terms omits the application of Sections 10, 10A, 10B, 10C and 10D of the Banking Regulation Act, 1949 to co-operative societies carrying on banking business. Clause (g) of Section 56, it may be stated, in its present form was inserted by Central Act 58 of 1968. It is quite clear from the review of these statutory provisions that there is nothing in the Banking Regulation Act, 1949 which requires a candidate who is an employee of a nationalized Bank or any Banking Company to produce a no-objection certificate for the purpose of contesting elections to the directorship of a co-operative society carrying on banking business.
14. Lastly, reliance has been placed upon Section 10 of the Reserve Bank of India Act, 1934. Sub-section (1) of Section 10 Of that Act after its amendment by Central Act 23 of 1965, inter alia, provides as follows:
'No person may be a Director or a member of a Local Board who-
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(e) is a Director of a banking company within the meaning of clause (c) of Section 5 of the Banking Companies Act, 1949, or of a co-operative bank.'
Local Board has been dealt with by Section 9 of that Act. It provides for constitution of a Local Board of the Reserve Bank of India for each of the four areas specified in the First Schedule to the Act. Now, clause (bviii) of Section 2 defines 'director' in relation to a co-operative banking society so as to include a member of any committee or body for the time being vested with the management of the affairs of that society. A cumulative reading of Sections 9 and 10 with clause (bviii) of Section 2 of the Reserve Bank of India Act, 19-34 makes it clear beyond any doubt that Section 10 enacts a prohibition for a director of a co,-operative Banking company from becoming a member of a IA', Board of the Reserve Bank of India, It does not enact a prohibition against an employee of a nationalized bank such as the petitioner is from becoming a director of a co-operative banking company nor does it require that such an employee should produce a no-objection certificate as a condition precedent to his valid nomination for election to the Board of Directors of a co-operative banking company. The argument based on Section 10 the Reserve Bank of India Act, 1934 appears to me to be the last ditch attempt to support the case of the respondents, I am, therefore, of the opinion that the Society was in error in rejecting the nomination of the petitioner for election to the directorship of the Society.
15. In the result, I allow this petition, quash and set aside the impugned orders made by the Co-operative Tribunal and the chairman of the Board of Nominees and issue a writ of mandamus directing the Society respondent No. 1, to accept the nomination of the petitioner for election to the directorship of the Society and to hold the elections according to law after having done so. Rule is made absolute with no order as to costs in the circumstances of the case.
16. At the instance of the petitioner the Registrar is at liberty to communicate to respondent No. 1 the final order immediately.
17. Petition allowed