Suresh Maruti Ghule vs Madhavrao Dattatraya Kalbhor And ...
2003 Latest Caselaw 765 Bom

JUDGMENT

A.M. Khanwilkar, J.

1. Heard.

2. Rule.

3. Rule made returnable forthwith by consent.

4. As short question is involved, the matter is taken up for final disposal forthwith by consent.

5. This petition takes exception to the judgment and order passed by the Maharashtra State Cooperative Appellate Court, Mumbai Bench, Pune at Pune dated 17th May, 2003 in A.O. No. 92 of 2003. Briefly stated, the elections to the Managing Committee of the respondent No. 4 society was held some time in July, 2000 where after Respondent No. 1 was elected as Vice Chairman. Along with Respondent No. 1 one Mr. Kanchan was elected as Chairman of the Society. The first meeting was held on 31.8.2000, when the newly elected body took over the affairs of the Society. Later on, on 7.9.2000 the Managing Committee passed a resolution authorizing Chairman or Vice Chairman to be the first signatory and Managing Director or Secretary as the Second signatory to operate bank accounts of the Respondent No. 4 Society. That arrangement was continued till recently. However, in the meeting held on 8.4.2002, the authority given to chairman to be one of the signatory was taken away by the Managing Committee. That resolution was challenged by the chairman Shri. Kanchan by way of dispute under Section 91 of the Maharashtra Cooperative Societies Act. In the said dispute he had prayed for stay of the said resolution. However, that relief was rejected. Appeal against that decision also came to be rejected. In other words, the Vice Chairman, Respondent No. 1 herein remained the only person as the first signatory on the cheques. To obviate any inconvenience, the Managing Committee thought it proper to appoint the Petitioner also to be the first signatory in alternate to the Vice Chairman Respondent No. 1, vide resolution dated 20.3.2003. That resolution was challenged by Respondent No. 1 to 3 before the Cooperative court by way of Dispute under Section 91 of the Act. According to Respondent No. 1, he being the Vice Chairman of the Society, in the absence of Chairman, he alone can be the signatory and the Managing Committee cannot allow Petitioner to be the first signatory. The Respondent No.1 filed an application for interim stay of the resolution dated 20.3.2003. However, the Cooperative Court rejected that application. Against that decision, Respondent No. 1 to 3 carried that matter in appeal and the appellate court by the impugned judgment and order has allowed the appeal and restrained the Petitioner from acting upon the said resolution dated 20.3.2003 and from signing cheques and other specified documents for on behalf of the Opponent No. 2 Karkhana. The appellate court has proceeded on the premise that, under the bye-laws, in the absence of Chairman it is only the Vice Chairman who can perform his duty. The appellate court has further found that resolution dated 20.3.2003 authorizing the Petitioner to be first signatory in the alternate to Respondent No. 1 is contrary to byelaws and such decision cannot be sustained. For that purpose, reliance was placed on the decision of this court reported in 1983 Mh.L.J. 1081 in the case of Pandurang Hindurao Patil v. State of Maharashtra and in the case of H.B. Patil v. Krishnarao P. Patil. Essentially on this basis the appellate court has allowed the appeal preferred by Respondent Nos. 1 to 3.

6. Having considered the rival submissions and the record, to my mind, the approach of the appellate court cannot be sustained. There is nothing in the byelaw No. 34, a sis referred in Para 11 by the appellate court, to suggest that the Chairman ought to be the signatory to operate the Bank account of the Society. However, that is a general provision which provides that in the absence of the Chairman, Vice Chairman will discharge duties of the Chairman. The moot question is; whether the authority to sign the cheques for and on behalf of the Respondent No. 4 society is referable to any specific byelaw - Only then it will be possible to suggest that resolution as passed is contrary to that byelaw. However, no specific byelaw has been brought to my notice which deals with that situation. Whereas, it is the managing committee which is obliged to deal with the administration of the society. The various duties of the managing committee can be culled down from byelaw No. 43. Byelaw No. 43(23) provides that to enable compliance of sub byelaw No. 2, the Managing Committee can do all that is necessary for the fulfillment of its duties. In that sense, it is the Managing committee which was obliged to authorize some person to be the signatory for and on behalf of the Society. It will be useful to refer to byelaw No. 48 which deals with the duties of the Managing Director. The Managing Director is entitled to sign cheques and other documents on behalf of the society in terms of Clause 12 of byelaw No. 48 - but subject to the resolution of the Managing Committee. There is no other byelaw which expressly provides that particular office bearer to be the signatory. In such situation, it is only the Managing Committee which could have authorized proper person to be the signatory for and on behalf of the Society. The requirement insisted upon by the Banker is that there ought to be atleast two signatories. It is in that background the Managing Committee had earlier resolved on 7th September, 2000 that Chairman in the alternate the Vice Chairman of Society to be the first signatory and, Managing Director in the alternative the Secretary to be the second signatory. It is because of that resolution the Chairman as well as Vice Chairman Respondent No. 1 became authorized to sign the cheques on behalf of the Respondent No. 4 Society and not otherwise. As the Managing Committee was the authorising agency, it could later alter the authorisation in favour of some other person or persons. Understood thus, if the Managing Committee has subsequently resolved on 20.3.2003 that the Petitioner to be one of the signatory in the alternative to the Vice Chairman Respondent No. 1 herein, then such resolution cannot be labelled as contrary to byelaw as such. On this reasoning alone the decisions relied upon by the appellate Court referred to above will be of no avail, because in those cases the decision of the Managing Committee has been held to be contrary to byelaw. To overcome this position, Mr. Kadam for Respondent No. 1 contends that, as there is no specific byelaw on the subject, principle underlying these decisions would squarely apply and for which reason, the resolution dated 20.3.2003 will have to be held as contrary to byelaws. This submission clearly overlooks that Respondent No. 1 as well as Chairman or the Managing Director as the case may be, were authorized to be the signatories only by virtue of the resolution passed by the Managing Committee on 7th September, 2000. If the above argument was to be accepted and taken to its logical end, then it will necessarily follow that even the resolution of 7th September, 2000 will be contrary to byelaws. That situation cannot be countenanced. In that eventuality, there will be no office bearer authorized to sign the cheques or operate the bank accounts of Respondent No. 4 society. At the interlocutory stage, therefore, the appellate court clearly misdirected itself in interfering with the order passed by the Cooperative Court in dismissing the application for interim injunction.

7. Accordingly, the impugned judgment and order is set aside and the one passed by the Cooperative Court dated 29.4.2003 is restored.

8. However, to bring quietus to the controversy raised in the dispute, it would be appropriate that the Cooperative Court is directed to decide the dispute as expeditiously as possible. The parties may approach the Cooperative Court for such relief who in turn shall consider that request. The question involved is, essentially, question of law. The Cooperative Court may decide the dispute on its own merits in accordance with law without being influenced by any of the observations made in the present order or for that matter by the courts below.

9. Petition disposed of in above terms. No order as to costs.

10. All concerned to act on ordinary copy of this order duly authenticated by Personal Secretary/Court Sheristedar.