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M.D. Krishnamurthy Vs. Deputy Registrar of Co-operative Societies, Chepauk, Madras and ors. - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtChennai High Court
Decided On
Case NumberWrit Petn. no. 319 of 1952
Judge
Reported inAIR1953Mad542; (1952)2MLJ868
ActsMadras Co-operative Societies Act, 1932 - Sections 57; Madras Co-operative Societies Rules - Rules 21, 24 and 27
AppellantM.D. Krishnamurthy
RespondentDeputy Registrar of Co-operative Societies, Chepauk, Madras and ors.
Appellant AdvocateK.V. Venkatasubramania Aiyar and ;T.P. Gopalakrishnan, Advs.
Respondent AdvocateGovernment Pleader
DispositionPetition dismissed
Excerpt:
- - if so, the by-law which is inconsistent with the provisions of the act is bad......the committee and other officers.'5. in exercise of the said power the provincial government made rules. rule xxvii (i)says:'no person shall be eligible for appointment as a member of the committee of any society if he is a near relation of a paid employee of the society; provided that if any question arises whether a person is or is not a near relation of a paid employee of the society, the question shall be referred to the registrar and his decision shall be final.'rule 2 of the co-operative societies act states: 'with every application for registration, the applicants shall submit a draft of the by-laws agreed upon by them. the by-laws shall be consistent with the act and with the rules made by the local government thereunder and they shall deal with the matters specified in clauses.....
Judgment:
ORDER

Subba Rao, J.

1. This is an application for issuinga writ, of certiorari to quash the order of theDeputy Registrar of Co-operative Societiesdated 15-4-1952.

2. The petitioner was elected as a Director of the Triplicane Urban Co-operative Society Ltd., in February, 1952. One of the paid employees of the said Society is one Rajagopalan. The petitioner and Rajagopalan have married sisters. On 26-3-1952, the Deputy Registrar of Co-operative Societies issued a notice to the petitioner calling upon him to show cause why he should not be removed from the Board, of Directors on the ground that he was a near relative of one of the paid employees of the Society. The petitioner offered his explanation by his letter dated 9-4-1952. On 15-4-1952 the Deputy Registrar made an order declaring that the petitioner would cease to be a director of the Triplicane Urban Co-operative Society. The aforesaid petition has been filed to quash that order.

3. The learned Counsel for the petitioner raised before me three points (i) The by-laws and the rules governing the Society provided for an election petition and as no election petition was filed within the time prescribed the petitioner's election to the directorate cannot be questioned, (ii) The rule prescribing that near relationship as a disqualification is ultra vires the Constitution, (iii) The Deputy Registrar has no power to direct the removal of a person elected to the directorate.

4. To appreciate the first contention and to provide an answer for the same the relevant provisions of the rules made under the Madras Co-operative Societies Act, the by-laws of the Triplicane Urban Co-operative Society and the rules of the Society may be extracted. Rule 65, (1) ays:

'The Provincial Government may, for the whole or any part of the Presidency of Madras and for any registered Society or class of such Societies make rules to carry out all or any of the purposes of this Act.'

Rule 65 (2) (i) says:

'In particular and without prejudice to the generality of the foregoing power, such rules may provide for the appointment, suspension and removal, of the members of the Committee and other officers and for the procedure at meetings of the committee and for the powers to be exercised and the duties to be performed by the committee and other officers.'

5. In exercise of the said power the Provincial Government made rules. Rule XXVII (i)says:

'No person shall be eligible for appointment as a member of the Committee of any society if he is a near relation of a paid employee of the society; provided that if any question arises whether a person is or is not a near relation of a paid employee of the society, the question shall be referred to the Registrar and his decision shall be final.'

Rule 2 of the Co-operative Societies Act states:

'With every application for registration, the applicants shall submit a draft of the by-laws agreed upon by them. The by-laws shall be consistent with the Act and with the rules made by the local Government thereunder and they shall deal with the matters specified in Clauses (a) to (z) and may deal with such other matters incidental to the organisation of the society and the management of its business as may be deemed necessary.'

(6) Rule 19 (ii) (a) of the by-laws of the Triplicane Urban Co-operative Society states:

'The Board of Directors shall have the power to draw up and enforce rules not inconsistent with the by-laws for the following among her purposes:

(v) The election to the -Board of directors and to the Local Panchayats.' Rule 21 of the by-laws of the Triplicane Urban Co-operative Society states:

'No election shall be called in question except by an election petition presented by any voter or voters of the branch in which the election has taken place within 3 days after the publication of the elections at the branch concerned.'

Rule 24 states:

'All election objection petitions be tried by an ad hoc committee of three independent advocates appointed by the Board of directors from among the members of the society who do not hold any honorary office and their services be purely honorary. There shall be a right of appeal from such decisions of the committee within 3 days after the communication of the decision of the Committee. The Board's decision on appeal will be final.'

It will be seen from the aforesaid provisions that under Rule 27 (a) of the rules made under the Madras Co-operative Societies Act the Registrar shall decide when a question is raised whether a person is a near relation of the paid employee, whereas under the rules framed by the Co-operative Society an election of a person to the directorate can be questioned only by an election petition filed within 3 days from the date of the election and that election petition will be disposed of by a committee of 3 advocates subject to an appeal to the Board. It is, therefore, manifest that the rules in so far as it encroached upon the right of the Registrar to decide the question under Rule 27(a) is inconsistent with the rules made under the Madras Co-operative Societies Act. The. Registrar may hold that a director is a near relation of the employee whereas the 'ad hoc' committee, or on appeal, the Board may hold that he is not a near relation. There may be inconsistent decisions. It is, therefore, a clear case of inconsistency, between Rule 27 (e) and the rules made by the society. If so, the by-law which is inconsistent with the provisions of the Act is bad. The Registrar is given a clear power under Rule 27 (e) to decide whenever a question arises whether a person is or is not a near relation.

7. The learned Counsel then contended that Rule 27 (e) is invalid as it confers upon the Registrar a naked arbitrary power. In appreciating this argument a distinction must be made between a rule conferring a power and an authority or whom such a power is conferred abusing that power. Taking the first aspect of the question, I find it rather difficult to hold that the rule conferred an arbitrary power upon the Registrar. The question to be decided is a simple one, namely, whether A is a near relation of B. The power to decide that question is conferred upon the Registrar who is accustomed to discharge judicial functions under the Act and who is expected to decide the question judicially. As the Registrar discharges his duty judicially and as his order is subject to revision to the Government he is expected to give his reasons for his decision. If ho goes wrong the Government under Section 57 of the Act can rectify the mistake. In those circumstances the power conferred upon the Registrar cannot be held to be an arbitrary power.

It was said that under this rule the Registrar may hold that a person remotely related is a near relation. As I have said, the Registrar exercising his functions judicially is not likely to abuse his power to such a degree and if he docs so a revisional' tribunal is there to rectify it. At the same time, to avoid such an abuse the Government may consider the question of adding a new rule prescribing the degree of relationship which would be a disqualification under Rule 27(1) of the rules.

8. I cannot also hold on the facts that the Registrar acted arbitrarily in the present case. The families of persons who married sisters are often more attached to each other than other families. Such families would be mutually interested in the welfare of each other, and they are therefore prone to help each other. The right to inherit the property of another is not the only test of near relationship. It cannot be said that the relationship in question is not a near relationship in the ordinary sense of the term. In those circumstances when the Registrar said that they are near relations, I cannot say that he acted arbitrarily.

9. I therefore hold that the rule is valid and the Registrar has not acted arbitrarily in exercising the power conferred on him under the rule.

10. Even so, the learned counsel contended that there is no provision under the Act empowering the Registrar to remove the petitioner from the directorate. It is not necessary to express my opinion on the question as the Registrar did not purport to do any such thing in exercise of the power conferred on him. He decided that the petitioner is disqualified to be the director of the Society. What would be the consequence of such a declaration I need not dilate upon.

11. In the result, I hold that no case has been made out for issuing a writ of certiorari. The petition is dismissed with costs.


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