S.Sudarshan Naidu, vs The State Of Andhra Pradesh,
2021 Latest Caselaw 5535 AP

                                                                          MVR,J
                                                             W.P.No.11680 of 2021
                                      1

         IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI

              HONOURABLE SRI JUSTICE M. VENKATA RAMANA

                           W.P.No.11680 of 2021
ORDER:

The petitioners sought a direction in the nature of writ of Mandamus

declaring the order in Memo No.AGC01-COOPOFASCS(EPIC)-1-2021-COOP-II,

dated 09.04.2021 passed by the 1st respondent vacating the stay granted

vide Order No.365/2016, dated 27.09.2016 as against the Order in

Rc.No.1261/2005-C, dated 26.10.2006 of the 3rd respondent directing

merger of Peddakowkuntla PACS, Raketla PACS into Amidyala PACS of

Uravakonda Mandal, Anantapur District and consequential order of 4th

respondent in Rc.No.1261/2005-C, dated 10.05.2021 directing the 5th

respondent to take necessary steps and for reporting compliance, as bad,

illegal, arbitrary, violative of principles of natural justice, contrary to the

provisions of A.P. Cooperative Societies Act, 1964 and offends Articles 14

and 19(c) of Constitution of India and consequentially to set aside the

same.

2. The Government of Andhra Pradesh with an intention to restructure

the Primary Agricultural Cooperative Societies (PACS) credit system in the

State came out with a scheme setting out guidelines for implementation

vide G.O.Ms.No.176 Agriculture & Cooperation (Coop.V) Department, dated

14.06.2005. The purpose and object in bringing out such scheme is stated

in the opening paragraph of this G.O. It is extracted hereunder for

convenience:

"The Government of Andhra Pradesh have felt that there is a need to restructure the Cooperative Credit Institutions for their strengthening and effective functioning for making them viable."

3. These guidelines included the following:

MVR,J W.P.No.11680 of 2021

"..................

(e) All the non-viable societies in a Mandal are to be amalgamated / merged with one focal non-viable society in the same Mandal. The focal point society among the non-viable societies for amalgamation/merger may as far as possible be at Mandal Head Quarters, provided there is no viable society at Mandal Headquarters.

(f) If the focal point society among the non-viable societies is not existing at the Mandal head quarters, any other village with the focal point non-viable society may be identified with better financial position, infrastructure, and at a convenient/ central.

..........................

(i) There shall not be merger of any non-viable society with a viable society."

4. To implement the scheme at the district level, a committee was also

constituted with the District Collector as the Chairman, General Manager

DCCB, Representative of NABARD and District Cooperative Officer as

Members and District Cooperative Officer being convener. The task

assigned to them was to identify viable and non-viable societies, Mandal

wise and take action in terms of Section 15(A) of A.P. Cooperative Societies

Act, 1964 and the rules thereunder. The District Collector was also

directed to identify the suitable focal and non-viable societies with which

other non-viable societies shall be merged.

5. Pursuant to these guidelines, the 3rd respondent - District Collector,

Anantapur, issued a notification dated 21.06.2015 calling for objections in

respect of merger of Amidyala, Raketla and Peddakowkuntla PACS, since

they were identified as non-viable societies in Uravakonda Taluk. Amidyala

PACS was identified as focal point non-viable society for the purpose of this

proposed merger with effect from 25.06.2015.

MVR,J W.P.No.11680 of 2021

6. One Sri P.Venkata Narayana, S/o.Kesanna and Sri Jalipati

Veerabhadra Goud, S/o.Verupana Goud filed W.P.No.19116 of 2005

aggrieved by the final order of the 3rd respondent directing such merger of

other two PACS into Amidyala PACS. It was disposed of by an order dated

01.09.2005, setting aside the proposed merger as well as order of the 3rd

respondent dated 25.07.2005, remitting the matter to the 3rd respondent

to consider objections of the members of the society giving them an

opportunity.

7. The above order was challenged by Smt.Gurram Ranganayakamma,

W/o.Sri late Gurram Sreeramulu, President of Amidyala Gram Panchayat in

W.A.No.2144 of 2005, where, by the judgment dated 14.11.2005 the 3rd

respondent - District Collector was directed to attend to the objections of

the parties and to pass a reasoned order in accordance with law.

8. Thereupon, the 3rd respondent - District Collector issued a revised

notification on 16.12.2005 under Section 15-A (1)(e) of APCS Act for the

same purpose of merger of these PACS with headquarter at Amidyala and

also in terms of the guidelines issued in G.O.Ms.No.176 Agriculture &

Cooperation (Coop.V) Department, referred to above, dated 14.06.2005.

9. Objections were received from members of these three PACS.

Members of Raketla PACS and Pedda kowkuntla PACS expressed their

unwillingness for the proposed merger and required to maintain their

individual identity as such.

10. Sri P.Venkata Narayana, S/o.Sri Kesanna and Sri Jalipati

Veerabhadra Goud, S/o.Sri Verupana Goud again filed W.P.No.27883 of

2005 questioning this revised notification dated 16.12.2005 of the 3rd

respondent. By an order dated 06.01.2006 in W.P.M.P.No.215 of 2006, it

was directed to proceed with the enquiry in this respect and not to pass a

final order thereon. Thereafter, W.P.No.27883 of 2005 came to be MVR,J W.P.No.11680 of 2021

disposed of by the order dated 31.07.2006 directing to consider the

objections in terms of G.O.Ms.No.176, dated 14.06.2005 and to pass an

appropriate order.

11. The 3rd respondent considering these objections, financial position of

these PACS and on account of central location of Amidyala PACS being

convenient to the members of other two PACS, viz. of Pedda kowkuntla and

Raketla, directed merger of all these three PACS identifying them as non-

viable societies and further identifying Amidyala PACS as focal society

directed merger of the above stated two PACS into Amidyala PACS by the

order dated 26.10.2006.

12. Against the aforestated order of the 3rd respondent dated

26.10.2006, Sri P.Venkata Narayana, S/o.Sri Kesanna filed W.P.No.24291 of

2006, where an interim order of status quo was granted and ultimately the

above writ petition was dismissed as infructuous by the order dated

10.03.2016 basing on the representation of learned counsel for the writ

petitioners that the cause in the writ petition did not survive.

13. Thereafter, it is the contention of the writ petitioners that Sri

P.Venkata Narayana, S/o.Sri Kesanna, approached the Government in

revision and an order of stay was granted in order No.365/MIN

EFST&COOP/2016, dated 27.09.2016.

14. It is the contention of the writ petitioners that the 1st respondent

issued the impugned memo dated 09.04.2021 vacating the above interim

order of stay, which was in force against the order of the 3rd respondent

and that, basing on this memo, the 4th respondent issued consequential

proceedings dated 10.05.2021 directing the 5th respondent to take

necessary steps and report compliance within 30 days. This action of the

respondents 1 and 4 is questioned in this writ petition.

MVR,J W.P.No.11680 of 2021

15. Sri D.V.Seetha Rama Murthy, learned Senior Counsel for Sri

V.Venugopala Rao, learned counsel for the petitioners contended that this

memo is issued without assigning any reasons and without mentioning if the

main revision petition is still pending or rejected. Learned Senior Counsel

further contended that no notice either to the petitioner, who moved

revision petition as President of Pedda kowkuntla PACS and representing its

members nor to the representative or members of this society including the

present petitioners, was issued. Thus, learned Senior Counsel contended

that this ground alone is sufficient to set aside these orders.

16. Sri D.V.Seetha Rama Murthy, learned Senior Counsel for the

petitioners referring to effect of Section 15-A of APCS Act, contended that

the order of the 3rd respondent dated 26.10.2006 was passed without

application of mind and without considering the ground realities. Learned

Senior Counsel brought to the notice of this Court that the PACS at Pedda

kowkuntla is serving the purposes of not only the main village but also its

hamlets, viz. China Kowkuntla, Y.Rampuram, Rachepalli and Mylarampalli

and that this PACS at Peddakowkuntla has about 3000 membership, which

is making profits as of now and since three years. Distance wise also it is

contended by learned Senior Counsel Sri D.V.Seetha Rama Murthy, that

proposal to merge all these three PACS into Amidyala PACS is a matter of

convenience to other villagers and therefore, it is contended that the

impugned memo as such cannot stand. It is also contended by learned

Senior Counsel that the State Government is considering to come up with

a new policy in this respect than what was envisaged in G.O.Ms.No.176.

17. Smt.Nischala Reddy, learned Government Pleader for Cooperation

referring to the chequered history of this attempt of amalgamation of

these three PACS referred to above, mainly contended that no revision

petition as such is pending with the Government and surprisingly an order MVR,J W.P.No.11680 of 2021

of status quo was passed by then Minister for Cooperation. In these

circumstances, learned Government Pleader contended that there is

nothing wrong in vacating the stay so granted. Justifying the action of 3rd

respondent stating that it is meeting all the requirements in terms of

G.O.Ms.No.176 dated 14.06.2005, learned Government Pleader further

contended that when W.P.No.24219 of 2006 filed by Sri P.Venkata

Narayana and others questioning the issuance of proceedings by 3rd

respondent was dismissed, the petitioners could not have laid the present

writ petition, since it is barred on account of dismissal of the earlier writ

petition on the same cause of action.

18. Smt.Nischala Reddy, learned Government Pleader for cooperation

also contended that financial position sought to rely on by the petitioners is

in respect of last three years and this financial position is not on account of

the core activity of these three PACS but on account of sale of food grains

as fair price dealers. Further contending that what is relevant to consider

now is only the situation then available when the proceedings of the 3rd

respondent was issued on 26.10.2006 and not the present status, it is

contended that the writ petition is a misconceived attempt that does not

lie.

19. Learned Government Pleader further contended that Amidyala PACS

is centrally located to serve the purposes of other two PACS. Pointing out

that the action of the 3rd respondent so taken finds justification and that

the action of the 4th respondent - District Cooperative Officer by the

proceedings dated 10.05.2021 directing its implementation is just and

proper, it is further contended that consequent action was also taken. It is

also contended by learned Government Pleader that these three PACS are

merged consequently and Amidyala PACS alone is serving to the needs of

the farmers of these three places. Learned Government Pleader also MVR,J W.P.No.11680 of 2021

referred to the letter of Divisional Cooperative Officer, Gooty of

Ananthapuram District, where it is stated that the merger of these PACS

went on and that Amidyala PACS alone is functioning as single society

attending to the needs of the villagers. Contending that the writ

petitioners did not have any right to enter into another round of litigation

against same orders passed by 3rd respondent, learned Government Pleader

requested to dismiss this writ petition.

20. Having regard to the nature of dispute and of the impugned order,

now it has to be determined "Whether the impugned memo is meeting the

requirements of principles of natural justice and an opportunity of being

heard, before passing such order?"

21. It is desirable to extract the impugned government memo

hereunder:

"GOVERNMENT OF ANDHRA PRADESH AGRICULTURE AND COOPERATION (COOP.II) DEPARTMENT

Memo No.AGC01-COOP0FACS(EPIC)-1-2021-COOP-II Dated:09.04.2021

Sub: A & C Department - Elections - Vacation of stay against merger of two societies into Amidyala PACS

- Reg.

Ref: From the CC & RCS, A.P., Guntur, File No.AGC06-

13023/39/2018-PAC SEC-CCRCS, dt:22.01.2021.

***

The attention of the Commissioner for Cooperation & Registrar of Cooperative Societies, A.P., Guntur is invited to the reference cited and he is informed that Government after careful examination, hereby vacate the stay granted by the then Hon'ble Minister for Cooperation in order No.365/2016, dated 27.09.2016 against the orders of the District Collector, Ananthapuram in Rc.No.1261/2005-C, dated 27.10.2006 with regard to merger of Pedakowkuntla PACS and Raketla PACS in to Amidyala PACS.

2. The Commissioner for Cooperation & Registrar of Cooperative Societies, A.P., Guntur, shall take necessary action in the matter, accordingly.

Y. MADHUSUDHANA REDDY SPECIAL SECRETARY TO GOVERNMENT MVR,J W.P.No.11680 of 2021

To

The Commissioner for Cooperation & Registrar of Cooperative Societies, A.P.

11th Line, Syamalanagar, Guntur-522006.

Copy to:

P.S. to Hon'ble Minister (Agrl. And Coop.) P.S. to Spl.Secretary to Government (AM & C) A & C Dept. Sf/Sc.

//FORWARDED :: BY ORDER// Sd/ B.Hemalata Devi SECTION OFFICER"

22. A bare perusal of this memo indicates that there are absolutely no

reasons assigned much less the circumstances that impelled the 1st

respondent to pass such an order. Not even there is a reference that a

revision presented by Sri P.Venkata Narayana is pending consideration with

the Government. It is not stated therein that after hearing on his behalf

and all the parties concerned, this memo has been issued.

23. Learned Government Pleader produced a copy of status quo order

issued by the then Minister for Cooperation, Government of Andhra

Pradesh, dated 27.09.2016. Except this order of interim stay, no other

proceeding relating to the revision petition is brought to the notice in the

course of hearing in this writ petition by which the proceedings of the 3rd

respondent with reference to these three PACS are sought to be

interdicted.

24. As seen from this letter dated 27.09.2016, there is no indication that

any revision was presented to the Government then, on behalf of the

petitioners, during course of consideration of the same, this order of stay

was issued by the then Minister for Cooperation.

25. Not only the impugned order but also order of stay referred to above

are lacking in reasons nor indicative of any effort made to hear the parties,

before issuing these orders.

26. May be for this reason learned Government Pleader contended that

no revision is pending as such against the Amidyala PACS. Nonetheless, MVR,J W.P.No.11680 of 2021

having regard to the memo impugned in this writ petition, the contention

of Sri D.V.Seetha Rama Murthy, learned Senior Counsel for the petitioners

in this respect is quite appropriate.

27. Contention of learned Government Pleader that this impugned memo

has been implemented merging these three PACS and that PACS Amidyala

alone is functioning at present, cannot stand. No material except a letter

of Sub-Divisional Co.Op.Officer, Gooty is produced by learned Government

Pleader, in this context.

28. Having regard to nature of this memo and the findings so recorded

above, it is unnecessary for this Court to consider the contentions of the

petitioners and of the respondents on merits. The matter requires

reconsideration by the 1st respondent, who shall necessarily follow due

procedure, explicitly making out application of principles of natural

justice. Hence, the impugned memo should necessarily be set aside

allowing this writ petition and also setting aside the consequential action.

29. In the result, this writ petition is allowed. Memo of the Government

of Andhra Pradesh in Memo No.AGC01-COOP0FACS(EPIC)-1-2021-COOP-II,

dated 09.04.2021 is set aside and consequential action taken by the

respondents is also set aside. The matter is remitted to the 1st respondent

to reconsider this issue, after verifying if there is any revision pending,

against the orders of the 3rd respondent-District Collector, giving all the

parties an opportunity of being heard and shall dispose of the same on

merits within two (02) months from the date of receipt of copy of this

order. No costs. All pending petitions stand closed. Interim orders if any

stand vacated.

____________________ M. VENKATA RAMANA, J Dt: 28.12.2021 Rns MVR,J W.P.No.11680 of 2021

HON'BLE SRI JUSTICE M. VENKATA RAMANA

WRIT PETITION No.11680 OF 2021

Date:28.12.2021

Rns