Revinath Shetkari Dhanya ... vs The Divisional Joint Registrar / ...
2021 Latest Caselaw 2172 Bom

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               IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                          BENCH AT AURANGABAD

                          WRIT PETITION NO. 1681 OF 2021

 Revannath Shetkari Dhanya Adhikosh Seva
 Sahkari Sanstha Ltd., Vita, Tq. Sonpeth,
 District Parbhani, Through its Chairman,
 Rajesh Uttamrao Vitekar
 Age : 40 years, Occu: Agri.,
 R/o. Vita, Tq. Sonpeth, Dist. Parbhani.                    ... Petitioner

          Versus

 1.       The Divisional Joint Registrar,
          Aurangabad/
          District Cooperative Election Officer,
          Parbhani.

 2.       District Deputy Registrar
          Cooperative Societies, Parbhani,
          District Parbhani / Returning Officer
          for the Election of Parbhani District
          Central Cooperative Bank.

 3.       Assistant Registrar,
          Cooperative Societies, Sonpeth,
          District Parbhani.

 4.       Parbhani District Central Cooperative
          Bank Ltd., Parbhani,
          District Parbhani.                                ... Respondents


                                     ......
 Mr. V. D. Hon, Senior Advocate i/by Mr. P. D. Bachate with Mr. Abhinay D.
 Khot, Advocates for the Petitioner.

 Mr. K. B. Jadhavar, AGP for Respondent No.3.

 Mr. S. K. Kadam, Advocate for Respondent Nos. 1 and 2.

 Mr. K. J. Suryawanshi, Advocate for Respondent No.4.

 Mr. R. N. Dhorde, Senior Advocate i/by Mr. N. R. Pawade, Advocate for the
 Intervenor.
                                         .....




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                                                  CORAM : V. K. JADHAV, J.

DATED : 3 rd FEBRUARY, 2021

PER COURT:-

1. By consent, heard finally at admission stage.

2. The petitioner is a Co-operative Society registered under the

provisions of Maharashtra Co-operative Societies Act, 1960

(hereinafter for the sake of brevity referred to as "the Societies Act").

By way of present writ petition, the petitioner is challenging the

legality, validity and propriety of the order dated 15.01.2021 passed

by respondent No.1, thereby rejecting the objection raised by the

petitioner for including the name of delegate of the petitioner society

in the final voters list in the ensuing elections of respondent No.4-

Parbhani District Central Co-operative Bank Limited, Parbhani

(hereinafter for the sake of brevity referred to as "respondent No.4

Bank").

3. The learned senior counsel for the petitioner submits that the

petitioner society is registered on 4.6.2016. After registration of the

petitioner society, the petitioner society has passed resolution in the

general body meeting on 8.6.2016 for taking the membership of

respondent No.4 Bank and accordingly the application for

membership was filed on 11.7.2016. The petitioner society has also

purchased the share capital for the membership of respondent No.4

Bank on 11.7.2016 itself. Learned senior counsel submits that in

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view of the provisions of section 27(3) of the Societies Act, any new

member society of a federal society shall be eligible to vote in the

affairs of that federal society only after completion of the period of

three years from the date of its investing any part of its fund in the

shares of such federal society. Learned senior counsel submits that

the petitioner society has completed three years on 10.7.2019 from

the date of investment of its share in the federal society and as such,

the petitioner society is eligible to take part in the elections of

respondent No.4 Bank. Learned senior counsel submits that even

respondent No.4 Bank has issued certificate on 17.3.2020 certifying

therein that the petitioner society had paid the amount of shares on

11.7.2016 itself and further, as per the said certificate, respondent

No.4 Bank has granted membership in favour of the petitioner society

on 20.5.2017. Learned senior counsel submits that the petitioner

society has passed resolution in the meeting dated 27.2.2020 for

sending the name of delegate to include the said name in the voters

list of respondent No.4 Bank and in view of the same, name of the

petitioner society is required to be included in the provisional voters

list of respondent No.4 Bank. Though respondent No.4 Bank has

published the voters list on 16.3.2020, name of the petitioner society

was not included in the provisional voters list. Thus, the petitioner

has filed objection on 19.3.2020, however, due to outbreak of

COVID-19, the election programme of respondent No.4 Bank was

postponed. Pursuant to the new election programme, the petitioner

society again raised objection on 6.1.2021 with similar request for

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inclusion of name of the delegate of the petitioner society in the

voters list. Learned senior counsel submits that respondent No.1 has

not considered the date of investment of shares for computing the

period of three years and rejected the objection raised by the

petitioner on 15.1.2021.

Learned senior counsel for the petitioner, in order to

substantiate his submissions, placed reliance on the following

cases:-

1. Dudhganga Vikas Seva Sanstha Maryadit vs. Distt.

Collector, Kolhapur and Others, reported in (2006) 5 SCC 250.

2. Dhule Gramin Vikas Bhajipala Phal Phalawal Va Phule Kharedi Vikri Sahakari Sanstha Ltd. and Others vs. State of Maharashtra and Others, reported in 2007 (5) ALL MR 867.

3. Amrutdhara Dudh Utpadak Sahakari Sanstha and Another vs. The State of Maharashtra and Others, reported in 2012 (3) ALL MR 850.

4. Babaji Kondaji Garad and Others vs. Nasik Merchants Co-operative Bank Ltd., Nasik and Others, reported in AIR 1984 SC 192.

4. Mr. Suryawanshi, learned counsel for respondent No.4 Bank

submits in terms of the provisions of sub-rule (2) of Rule 9 of the

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Maharashtra Co-operative Societies (Election to Committee) Rules

2014, the period of three years provided in sub-section (3) of Section

27 of the Societies Act is to be counted from the date of enrollment of

member to the date when the election of the managing committee

members of the society becomes due. In the instant case, the name

of the petitioner society was enrolled as member on 20.5.2017 and

the cut-off date was on 6.5.2017. Thus, the petitioner society is not

eligible to vote in the affairs of the federal society as the period of

three years is not completed from the date of its enrollment.

5. Mr. Dhorde, learned senior counsel for the intervenor submits

that in terms of Rule 19 of the Maharashtra Co-operative Societies

Rules 1961, certain conditions are prescribed to be complied with for

admission as a member. Learned senior counsel submits that even

assuming that the petitioner society has invested any part of its funds

in the shares of respondent No.4 Bank, however, the application

submitted by the petitioner society for enrollment as a member is to

be approved by the committee of respondent No.4 Bank subject to

such resolution as the general body of members may, in pursuance

of the powers conferred on it in that behalf from time to time, pass.

Mr. Dhorde, learned senior counsel, in order to substantiate

his contentions placed reliance on the judgments in the following

cases:-

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1. Eknath Ashiram Alekar and Others vs. State of Maharashtra and others, reported in 1989 (3) Bom.C.R. 165.

2. Judgement dated 20.01.2011 delivered by Nagpur Bench of this Court in LPA No. 209 of 2010 in WP No. 3559 of 1999 [Shri Sharad s/o Keshavrao Kubde and Others vs. Jawahar Cooperatve Housing Society Ltd. and Others].

6. I have also heard learned counsel Mr. Kadam, for respondent

Nos. 1 and 2 and learned A.G.P. for respondent No.3

7. I have carefully considered the submissions advanced by

learned senior counsel/counsel for the respective parties. With their

able assistance, I have perused the pleadings, grounds taken in the

petition and annexures thereto.

8. The petitioner society is registered on 4.6.2016. The petitioner

society has also filed an application for membership of respondent

No.4 Bank on 11.7.2016 and the petitioner society has also

purchased the share capital for membership of respondent No.4

Bank on 11.7.2016 itself. These facts are not disputed by respondent

No.4 Bank.

9. The provisions of Section 27 of the Societies Act speak about

voting powers of the members. Sub-sections (3) and (3A) of Section

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27 of the Societies Act are relevant for deciding the issue raised in

the present writ petition. Thus, sub-sections (3) and (3A) of Section

27 of the Societies Act are reproduced herein below:-

"27. Voting powers of members.

(1) .....

(2) .....

(3) A society which has invested any part of its funds in the shares of any federal society, may appoint one of its active members to vote on its behalf in the affairs of that federal society; and accordingly such member shall have the right to vote on behalf of the society:

Provided that, any new member society of a federal society shall be eligible to vote in the affairs of that federal society only after the completion of the period of three years from the date of its investing any part of its fund in the shares of such federal society:

(3A) An individual member of a society shall not be eligible for voting in the affairs of that society for a period of two years from the date of his enrollment as a member of such society:

Provided that, nothing in this sub-section shall apply in respect of a co-operative housing society and a co- operative premises society."

10. Thus, from bare reading of Section 27(3) and the proviso

thereof, it is clear that the condition for eligibility of a member to vote

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in the affairs of a federal society is completion of three years from the

date of its investing any part of its funds in the shares of such federal

society. So far as sub-section (3A) is concerned, there is marked

difference between a member society and an individual member of

the society. If it is a member society, what is important and relevant is

the date of investing any part of its funds in the shares of such

federal society i.e. respondent No.4 Bank in the present case. Thus,

completion of period of three years is required to be computed from

the said date of investment. So far as the sub-section (3A) pertaining

to an individual members of the society is concern, he shall not be

eligible for voting in the affairs of the federal society for a period of

two years from the date of its enrollment as a member of that society.

Thus, for an individual member, the criterion is the date of enrollment

as member of such federal society.

11. In the case of Dudhganga Vikas Seva Sanstha Maryadit

(supra) relied upon by learned senior counsel for the petitioner, in

para Nos. 7 and 8, the Supreme Court has made following

observations:-

"7. A mere reading of section 27 makes it explicit that a society, which has invested any part of its fund in the shares of a federal society, may appoint one of its members to vote on its behalf in the affairs of the federal society. Proviso to sub- section (3) of Section 27 of the Act lays down the condition of eligibility which is to the effect that any new member of a

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federal society shall be eligible to vote in the affairs of the federal society only after the completion of the period of 3 years from the date of its investing any part of its fund in the shares of such federal society. We may also note sub- section (3-A) of Section 27 of the Act which relates to an individual member of a society. In his case it is provided that he shall not be eligible for voting in the affairs of that society for a period of two years from the date of his enrollment as a member of such society. The legislature has consciously employed in sub-sections (3) and (3-A) words which are of significance. In the proviso to sub-section (3) the period of 3 years is reckoned from the date of the society investing any part of its fund in the shares of a federal society, whereas sub-section (3-A) provides that the period of 2 years shall be computed from the date of enrollment of an individual as a member of such federal society.

8. Having regard to the plain words used in Section 27(3) of the Act, the appellant Society having invested its fund in the shares of Kolhapur District Central Cooperative Bank Ltd., Respondent 2 herein on 30-12-2002, it became eligible to vote in the affairs of the federal society after 30-12-2005. We are informed that the date of investment by the appellant Society and its enrollment as a member of the federal society is the same, namely, 30-12-2002. Ex facie, therefore, in terms of Section 27(3) of the Act, in April 2006 when the election was due to be held, the appellant Society was entitled to appoint one of its members to vote on its behalf in the affairs of the federal society Respondent 2, having completed the period of 3 years from the date of its investment in shares of Respondent 2 society on 30-12- 2005."

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12. In the case of Dhule Gramin Vikas Bhajipala Phal

Phalawal Va Phule Kharedi Vikri Sahakari Sanstha Ltd. (supra),

relied upon learned senior counsel for the petitioner, the Division

Bench of this Court, by referring the observations made by the

Supreme Court in the case above i.e. Dudhganga Vikas Seva

Sanstha Maryadit (supra), in para 18 of the judgment has made

following observations:-

"18. We find from perusal of the provisions of Section 27(3) of the Act, 1960 that there is no ambiguity in its application. Considering the interpretation put up by the Apex Court and the Division Bench of the Bombay High Court in their judgment to the provisions of Section 27 of the Act read with Rule 4 of the Committee Rules it can be safely held that the members society of the federal society shall be eligible to vote in the affairs of the federal society after completion of period of three years from the date of its investing funds in the shares of the federal society."

13. In the case of Amrutdhara Dudh Utpadak Sahakari

Sanstha and Another (supra), relied upon by learned senior counsel

for the petitioner, the learned Single Judge of this court (Coram :

S. V. Gangapurwala, J.) in para 10 of the judgment has made the

following observations:-

"10. Even sub section (3) of Section 27 of the said Act lays down that the society which has invested any part of its funds in the shares of the federal society, may appoint any of its members to vote on its behalf in the affairs of that

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federal society. The said sub section (3) of Section 27 of the said Act does not warrant that a specific membership has to be conferred on the society. It only mandates that the said Society should have invested any part of its funds in the shares of any federal society. In the present case, none of the respondents dispute the fact that the petitioners have invested part of their funds in the shares of the respondent no.4 -Society. The only embargo put on the rights of such a Society to vote is that it should have completed three (3) years from the date of its investing any part of its funds in the share of any federal society in view of proviso (3) to Section 27. In the present case, the petitioners have invested their part of the funds in the shares of respondent no.4 in the year 2002. Even the said restriction laid down in proviso would not apply in this case."

14. Learned senior counsel has further placed his reliance on the

judgment in the case of Babaji Kondaji Garad and Others vs.

Nasik Merchants Co-operative Bank Ltd., Nasik (supra) wherein,

in para 10 of the judgment, the Supreme Court has considered the

use of expression "shall" by the Legislature and observed that the

intention of the Legislature in using the word "shall" manifest its

intention. Learned senior counsel submits that in the instant case, in

the proviso of sub-section (3) of Section 27 the word "shall" is used

and as such, the petitioner society is eligible to vote in the ensuing

elections of respondent No.4 Bank.

15. So far as the sub-Rule (2) of Rule 9 of the Maharashtra Co-

operative Societies (Election to Committee) Rules, 2014 relied upon

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by learned counsel for respondent No.4 Bank, the period of three

years as provided in sub-Section (3) of Section 27 of the Societies

Act is to be computed from the date of enrollment of member to the

date when the election of the managing committee members of the

society becomes due. In sub-Rule (2) a reference has been given to

sub-section (3) of Section 27 of the Societies Act. However, even if

there is any inconsistency, needless to say that the Act prevails over

the Rules.

16. Learned senior counsel Mr. Dhorde, has placed his reliance in

the case of Eknath Ashiram Alekar (supra) wherein the Division

Bench of this court has referred to Rule 19 of the Maharashtra Co-

operative Societies Rules, 1961. However, the facts of the said case

are altogether different. The substantial questions agitated in the

aforesaid petition were that the membership was granted by the

Chairman of the sugar factory on one single day to near about 3387

persons without following due procedure prescribed by the Societies

Act, Rules thereunder and the bye-laws of the sugar factory framed

under the Act and the Rules. In the backdrop of these facts, the

Division Bench has observed that under the provisions of the bye-

laws and the Rules, it is the managing committee and not respondent

No.5 Chairman, who is empowered to consider the application for

membership, but the applications for membership can be approved

only by the managing committee or the board of directors. In the

case cited above, the provisions of Section 27 sub-section (3) of the

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Societies Act are not discussed. Similarly, in the second case relied

upon by learned senior counsel for the intervenor, the provisions of

Section 27(3) are not discussed.

17. It is pertinent to note that though the petitioner societies, in all

writ petitions to be decided separately but on identical facts, with the

same issue, were registered long back in the year 2011, 2013, 2014,

2015 respectively, however, respondent No.4 Bank has enrolled

them as member on one and the same day i.e. on 20.5.2017. Thus,

the only irresistible inference could be drawn is that care has been

taken while enrolling those petitioner societies as members that they

should not be eligible to vote in the ensuing elections of respondent

No.4 bank in terms of the provisions of Section 27(3) of the Societies

Act and the proviso thereof. Learned counsel appearing for

respondent No.4 bank has failed to tender any explanation as to why

there is belated enrollment of the said petitioner societies as

members of the bank. It thus appears that prescribing common date

of enrollment has been done with some oblique motive.

18. In view of the above and considering the relevant provisions

and the ratio laid down by the Supreme Court and the Division Bench

of this Court and also the Single Judge of this Court, I am of the

considered opinion that the impugned order is not sustainable and

the same is liable to be quashed and set aside. In view of the same,

I proceed to pass the following order:-

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ORDER

I. Writ petition is hereby allowed in terms of prayer clause "B".

II. Writ petition is accordingly disposed of.

( V. K. JADHAV, J.)

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