SCA/8017/2008 13/ 13 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No. 8017 of 2008 For Approval and Signature: HONOURABLE MR.JUSTICE K.M.THAKER ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ========================================================= ACHARYA KAMLESHKUMAR SURYAKANTBHAI & 1 - Petitioner(s) Versus REGISTRAR- CO-OPERATIVE SOCIETIES & 2 - Respondent(s) ========================================================= Appearance : MR PS CHAMPANERI for Petitioner(s) : 1 - 2. Mr. JK SHAH, Asst. GOVERNMENT PLEADER for Respondent(s) : 1, NOTICE SERVED BY DS for Respondent(s) : 1 - 3. MR BS PATEL for Respondent(s) : 3, ========================================================= CORAM : HONOURABLE MR.JUSTICE K.M.THAKER Date : 10/06/2008 ORAL JUDGMENT
The
petitioners have approached this Court with belowmentioned prayers;
(A) This Honourable
Court will be pleased to issue a writ of mandamus or a writ in the
nature of certiorari or any other appropriate writ, order or
direction directing respondents nos. 1 and 2 to remove the executive
committee of respondent No.3 bank and to appoint Administrator ý
Custodian for reconstitution of the Committee of the respondent
No.3-Society;
(B) This Honourable
Court will be pleased to issue a writ of mandamus or a writ in the
nature of certiorari or any other appropriate writ, order or
direction directing respondents No.2 to supersede the executive
committee and/or to remove the executive of the respondent No.3
society forthwith and to appoint the officer, administrator or
custodian in place thereof;
( C) Pending
admission, hearing and final disposal of this petition, an interim
injunction may kindly be granted staying the implementation,
execution and operation of the impugned resolution and decision dated
10th May 2008 and consequently be pleased to restrain and
prohibit respondent No.3 or any of its officers or persons from
acting in any manner pursuant to the impugned resolution dated 10th
May 2008 in any manner;
(D) Pass such other
and further orders as may deem fit in the interest of justice.
In
view of the contention regarding the committee’s authority to pass
resolution dated 10.5.2008, petition requires to be considered.
Hence, Rule. Upon request of the respective Advocates and with
their consent, matter is taken up for final hearing and disposal
today.
2. The
respondent No.3, in present case, is a co-operative bank and as per
the provisions contained under the Gujarat Co-operative Societies
Act, 1961 [hereinafter referred to as ‘the Act’] the respondent No.3
is an urban cooperative bank. According to the submissions of the
petitioner, the provisions contained under Chapter X-B of the Act
are, therefore, applicable to it.
3. So
far as the facts relevant for present purpose are concerned, the
petitioners have come out with the case that the respondent No.3,
being an urban cooperative bank, is governed by the provisions
contained under Chapter X-B of the Act and more particularly by
provisions under Section 115-J which, according to the submissions of
the petitioners, has overriding effect over other provisions of the
Act, rules and bye-laws of the bank. The petitioners have stated
that the term of the executive committee of the respondent bank has
expired on 31.3.2008 and that therefore there is no power, as per
the provision applicable to the respondent No.3 bank, empowering or
authorising the members of the executive committee to continue to
hold in office even after the expiry of their term. The petitioners
have further narrated, in the petition, history of certain past
incidents which resulted into litigation in form of Lavad Suit No.
476 of 2005 and 477 of 2005 wherein judgment came to be delivered on
8th May, 2008. It is the case of the petitioners that the
legality and validity of the said judgment has been challenged by
filing appeals being Appeals No. 199 of 2008 and 200 of 2008 before
the Gujarat State Cooperative Tribunal. The petitioners have
disclosed that along with the said appeals, application for interim
relief also were preferred, however after hearing the parties, the
prayer for injunction has been rejected by the learned Tribunal. The
petitioners have also made reference of an order dated 12.9.2006
passed by the District Registrar, under Section 23 of the Act. After
stating the aforesaid and such other facts the petitioners have
stated that now the respondent No.3 has passed a resolution in the
meeting held on 10th May, 2008 appointing Election Officer
and Assistant Election Officer and thereby the respondent No.3 bank
has put in motion the process for election.
4. In
background of such facts and submissions, the petitioners have made
the above referred prayers.
5. In
response to the notice issued by virtue of the order dated 2.6.2008,
Mr. BS Patel has entered appearance on behalf of the respondent No.3
bank and Mr. JK Shah, learned AGP has appeared on behalf of the
respondents No. 1 and 2. On behalf of respondent No.3 a reply
affidavit has been filed wherein various contentions, including
objections as regards maintainability of the petition are raised.
The respondent No.3 contends, by way of the affidavit, that the
petitioners herein have already preferred appeal before the learned
tribunal, along with an application for interim stay, and such
application for interim relief has been rejected by the learned
tribunal by order dated 23.5.2008 and that therefore the present
petition, in view of the pending appeal, is not maintainable. It
is further contended that if at all the petitioners have any
grievance against the respondent No.3 or its functioning or the
decision taken during the meeting held on 10.5.2008, then there is an
appropriate alternative remedy made available by the statute by
virtue of Section 96 and the petitioners can file lavad case under
Section 96 and in view of such alternative remedy the petition is not
maintainable and does not deserve to be entertained. It is further
contended by the respondent No.3 that no case for appointment of
custodian is made out and in any case before requesting this court,
by invoking Article 226 of the Constitution of India, to appoint
custodian and/or to remove the executive committee of the respondent
No.3, the petitioner has not approached the authority under the Act,
i.e., respondent No.2 and therefore also there is no cause for
issuing writ of mandamus as prayed for. Besides the aforesaid
submissions, respondent No.3 has submitted that the steps for holding
election have already been taken and as a step in that direction a
resolution dated 10.5.2008 is passed appointing, unanimously,
Election Officer and Assistant Election Officer and that therefore
also there is no justification or merits in the subject petition.
6. I
have heard Mr. Champaneri, learned advocate for the petitioners and
Mr. BS Patel, learned advocate for respondent No.3 and Mr. Shah,
learned AGP for respondents No. 1 and 2. Mr. Champaneri has
reiterated the contentions stated in the petition and has submitted
that all that the petitioners pray is that a direction may be issued
for appointment of an administrator or custodian to oversee and/or
conduct the election so that the ensuing elections can be held in
fair manner under the authority and supervision of independent
person.
7. In
view of the fact that the resolution dated 10.5.2008 has already been
passed, and since the petitioner has not approached respondent No.2
with request for appointment of administrator or custodian or to
supersede the committee and as there is no decision by respondent
No.2 either granting or refusing such request, granting of such
relief at this stage ý particularly when resolution dated 10.5.2008
is passed appointing election officer ý would amount to undermining
the impartiality and independence and authority of Election Officer
and that therefore this Court is not inclined to and does not
propose, at this stage, to consider or entertain the prayer or to
pass an order that the executive committee may be removed or
superseded or to direct the respondent No.2 to remove or supersede
the Executive Committee.
8. Further,
the petitioners have also failed to make out a case that
eventualities which would necessitate appointment of custodian or an
administrator exist or have now come in existence. Even if it is
presumed that such circumstances exist, then also at this stage the
prayers of the petitioner do not warrant consideration by this Court
inasmuch as before approaching the court with such request the
petitioners ought to have approached the respondent No.2 and ought to
have made out a case before him for appointment of custodian or an
administrator and if only the respondent No.2 failed to pass any
order, rejecting the request then the action of the petitioners for
preferring the present petition and seeking directions against
respondent No.2 would be justified.
9. Even
otherwise, as per the provisions under the Act, the circumstances
and eventualities on occurrence of which a custodian may be
appointed, are provided. Likewise, the Act also contains the
provisions prescribing circumstances or eventualities when an
administrator may be appointed. The petitioner has failed to show
and establish that such circumstances or eventualities have occurred.
Besides, it would be for the respondent No.2, in the first instance,
to examine the issue and satisfy himself as to whether such need has
arisen and if he satisfied, either suo motu or on any representation,
then he would take necessary steps as may be considered appropriate.
It would be premature and pre-emptive, for the Court, to give at this
stage the directions as prayed for.
10. In
light of the facts and circumstances narrated by the petitioners and
in view of the relief prayed for by the petitioners, it is also not
necessary, at this stage, to examine in greater detail the contention
of the petitioners that in view of the provisions contained under
Chapter X-B and more particularly Section 115-J, the executive
committee of the respondent No.3 bank has no authority to continue to
hold office because its term has expired and the provision under
Section 115-J does not allow the committee and prohibit it to
continue to hold the office after expiry of its term. However,
suffice it to say that the respondents have not disputed the
petitioners’ contention that the term of the committee has expired.
Instead, the respondents have, come out with the submission that the
term of the committee has expired which has necessitated that the 11
posts may be filled in, and for that very purpose the actions for
initiating election process have already been taken and as a step in
that direction the Election Officer and Assistant Election Officer
have been appointed and that therefore there is no substance or
merits in the allegations or demand of petitioners.
11. On
plain reading of the said provision, namely Section 115-J, it comes
out that the provisions under Chapter X-B have an overriding effect
over the provisions in the Act or the Rules or the bye-laws of the
bank which may be contrary to the provisions under Chapter X-B.
Chapter X-B contains Sections 115-B to 115-L. Sections 115-K and
115-L contain the saving clause and transitory provisions
respectively while Section 115-J, as noticed above, gives overriding
effect to the provisions under this chapter. So far as Section 115-B
is concerned, the same contains definitions of the terms ‘Bank’,
‘Committee’, ‘Committee Member’, ‘Company’, ‘Member of a Bank’, and
‘Urban Cooperative Bank’, while Section 115-C prescribes
qualifications and disqualifications for being committee members.
Section 115-D provides for right to vote. Section 115-E prescribes
the functions which the committee must ensure and Section 115-G
provides for creation of Credit Equalization Fund. Section 115-H
makes provision for taking cognizance and punishment for offences and
by Section 115-I provisions under Section 84 are made applicable to
specify bank with the modification mentioned in Section 115-I.
12. From
the aforesaid, it becomes clear that so far as the controversy or
dispute in present matter is concerned, the said provisions, except
Section 115-J and thereby Section 115-E,would not have much
relevance.
13. This
brings in picture the provisions under Section 115-E. As per the
said provision, a Chairman or a Vice Chairman or the Managing
Director or a Committee are not entitled to hold office continuously
for more than 2 terms and can do so only after a hiatus of 2 terms.
Thus, if the petitioners want to rely upon and invoke the provisions
under Section 115-E against the Committee, then it would be
necessary for the petitioners to establish that the Chairman or the
Vice Chairman or the Managing Director or the Committee or all of
them have been holding office continuously for more than 2 terms. At
this stage, it would not be out of place to take note of submissions
advanced by Mr. Patel on behalf of respondent No.3 by relying upon
the bye-laws of respondent No.3 bank. Mr. Patel relied upon the
provisions contained under Bye-law No. 28 which, inter alia, provides
that the term of the 11 members of the board shall be of 3 years and
upon expiry of such term, the elected members of the existing board
shall continue to hold the office until the new elected members take
over the charge after election. The said bye-law of the respondent
society permit the existing members to continue to hold office until
new members are elected.
14. If
the petitioners establish the said fact, then only the petitioners
can invoke the said provision and press in service the said provision
against the said officers or the committee. There is no specific
averment in the petition categorically suggesting that any of the
members or officers have completed continuous two terms in the
office. The petitioners have failed to establish that all or any of
the 11 members have completed continuously 2 terms in office and
until that is established, the provisions under Section 115-E would
not be attracted. Thus, their actions e.g. Passing resolution on
10.5.2008 cannot be held to be without authority. Besides this, the
petitioners do not appear to have approached the respondent No.2 with
aforesaid facts.
15. Thus,
when there is no foundation to attract and/or apply provisions under
115-E, the issue of any of the bye-laws being contrary to the
provisions under Chapter X-B would not arise and consequently the
question of applicability of Section 115-J also would not arise.
The provision under bye-law 28 provides that until the new body is
elected, members of the existing body would continue. If in any
given case the existing body or any member of the body completes
continuously two terms in the office, then certainly the said
bye-law, in view of provision under Section 115-E r/w. Section
115-J, would not help such member to continue to hold the office
until the new body takes over. However, so long as the said
eventuality does not come in picture or is not established, (i.e., so
long as it is not established that the existing body or any of its
members has completed continuously two terms in office) question of
Bye-law 28 being contrary to Section 115-E or the question of 115-E
being attracted would not arise.
16. In
this view of the matter, it becomes clear that the petitioners have
failed to make out the case that the said resolution dated 10.5.2008
is without authority in law. It is also relevant to note that Mr.
Patel has pointed out that after the resolution dated 10.5.2008 the
election programme is already notified as per which the dates for
submitting nominations, verification of nomination, publication of
list of candidates/contestants and date for voting have already been
notified. As per the said programme, the date for voting is
22.6.2008. The said details bring out that the election process has
already commenced and therefore also now there is no justification
for this Court to interfere in the matter, much less to now stay the
implementation and operation of the resolution dated 10.5.2008.
17. It
is pertinent to note that on one hand the petitioners seek that the
new body should come in existence because the term of the existing
body has expired, whereas on the other hand the petitioners also pray
that the resolution dated 10.5.2008 by virtue of which Election
Officer has been appointed, may be stayed and the respondent No.3
may be restrained from acting in pursuance of the notification, which
would mean arresting the election process.
18. Since
this Court has come to the conclusion that the petitioners have not
established that the resolution is without authority in law, there
is no need to examine other issue or other relief prayed for in the
petition, i.e., for appointment of administrator or custodian because
by the said resolution dated 10.5.2008 the Election Officer and
Assistant Election Officer have been appointed and subsequently under
their authority, election programme has also been notified as a
result of which election process is in motion. There is no reason
or justification to interfere with the said election process and at
this stage, even otherwise, in view of the said development, the
question of appointment of custodian or administrator would not
arise.
19. Further,
if the facts are presented before the respondent No.2 and if the
respondent No.2 is satisfied either suo motu or upon submissions by
the petitioners or any other interested person, that the affairs of
respondent No.3 bank require appointment of custodian or an
administrator, then it would be for the respondent No.2 to take
appropriate decision and action. However, so long as the said
exercise is not undertaken, there would be no justification for
issuing any direction against respondent No.2 to appoint an
administrator or custodian. It would, however, be open for the
petitioners to approach the respondent No.2 so as to make out a case
before him and satisfy the respondent No.2 that affairs of respondent
No.2 bank warrants appointment of an administrator or custodian.
20. In
light of the aforesaid discussion and the facts of present case, the
petition is not required to be entertained at this stage. Rule
discharged. No order as to cost.
[
K.M. Thaker, J. ]
rmr.