Hiralal S/O Ganpatrao Bangadkar vs The State Of Maharashtra, Thr. Its ...
2022 Latest Caselaw 9978 Bom

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  IN THE HIGH COURT OF JUDICATURE AT BOMBAY
           NAGPUR BENCH AT NAGPUR

            WRIT PETITION NO. 3557OF 2021

   Hiralal s/o Ganpatrao Bangadkar,           : PETITIONER
   Aged 57 years, Occu. Business,
   r/o Shivaji Ward, Near Pinglie Mata
   Mandir, Shukrawari, Bhandara 441 904
                            VERSUS
1 State of Maharashtra through its Minister   : RESPONDENTS
  for Co-operation & Marketing,
  Maharashtra State, Mantralaya, Mumbai-
  32
2 The Divisional Joint Registrar Co-
  operative Societies, Nagpur. Office at
  Dhanwate Chambers, behind Hotel
  Hardeo, Near Bhide Girls High School,
  Sita Buildi, Nagpur
3 The Bhandara Urban Cooperative Bank
  Ltd., Bhandara, through its Chief
  Executive Officer. Having Head office at
  Gandhi Chowk, Bhandara
4 Jayant s/o Vasantrao Vairagade,
  aged 65, occu. Legal Practitioner
  r/o Plot No.11 & 12, Vidarbha Housing
  Colony Board, Takiya Ward, Bhandara
  441904

                        WITH
            WRIT PETITION NO. 3559 OF 2021

   Hiralal s/o Ganpatrao Bangadkar,           : PETITIONER
   Aged 57 years, Occu. Business,
   r/o Shivaji Ward, Near Pinglie Mata
   Mandir, Shukrawari, Bhandara 441 904
                            VERSUS
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1 State of Maharashtra through its Minister   : RESPONDENTS
  for Co-operation & Marketing,
  Maharashtra State, Mantralaya, Mumbai-
  32
2 The Divisional Joint Registrar Co-
  operative Societies, Nagpur. Office at
  Dhanwate Chambers, behind Hotel
  Hardeo, Near Bhide Girls High School,
  Sita Buildi, Nagpur
3 The Bhandara Urban Cooperative Bank
  Ltd., Bhandara, through its Chief
  Executive Officer. Having Head office at
  Gandhi Chowk, Bhandara
4 Ramdas s/o Jagannath Shahare,
  aged 72 years, Occu. Retired,
  r/o Santaji Ward, Shastri Chowk, Bhandara
  441904

                        WITH
            WRIT PETITION NO. 3560 OF 2021

   Hiralal s/o Ganpatrao Bangadkar,           : PETITIONER
   Aged 57 years, Occu. Business,
   r/o Shivaji Ward, Near Pinglie Mata
   Mandir, Shukrawari, Bhandara 441 904
                            VERSUS
1 State of Maharashtra through its Minister   : RESPONDENTS
  for Co-operation & Marketing,
  Maharashtra State, Mantralaya, Mumbai-
  32
2 The Divisional Joint Registrar Co-
  operative Societies, Nagpur. Office at
  Dhanwate Chambers, behind Hotel
  Hardeo, Near Bhide Girls High School,
  Sita Buildi, Nagpur
3 The Bhandara Urban Cooperative Bank
  Ltd., Bhandara, through its Chief
  Executive Officer. Having Head office at
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    Gandhi Chowk, Bhandara
 4 Jyoti Poonamchand Bawankar,
   aged 45, Occu. Household,
   r/o Plot No. 3, Shastri Nagar, Gurunanak
   Ward, Bhandara 441 904

                          WITH
              WRIT PETITION NO. 3558 OF 2021

    Hiralal s/o Ganpatrao Bangadkar,            : PETITIONER
    Aged 57 years, Occu. Business,
    r/o Shivaji Ward, Near Pinglie Mata
    Mandir, Shukrawari, Bhandara 441 904
                              VERSUS
 1 State of Maharashtra through its Minister    : RESPONDENTS
   for Co-operation & Marketing,
   Maharashtra State, Mantralaya, Mumbai-
   32
 2 The Divisional Joint Registrar Co-
   operative Societies, Nagpur. Office at
   Dhanwate Chambers, behind Hotel
   Hardeo, Near Bhide Girls High School,
   Sita Buildi, Nagpur
 3 The Bhandara Urban Cooperative Bank
   Ltd., Bhandara, through its Chief
   Executive Officer. Having Head office at
   Gandhi Chowk, Bhandara
 4 Dinesh s/o Murlidhar Girhepunje,
   aged 45 years, Occu. Business,
   r/o Ward No.6, Near Hanuman Mandir,
   Lakhani, District Bhandara.

Mr. Akshay A. Naik, Advocate for petitioner in all petitions
Mr. N.R. Rode, AGP for respondent Nos.1 & 2 in all petitions
Mr. P.S. Tidke, Advocate for respondent No.3 in all petitions
Mr. A.M. Ghare, Advocate for respondent No.4 in all petitions
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                  CORAM :                  MANISH PITALE, J.

                  RESERVED ON :            07/09/2022

                  PRONOUNCED ON: 29/09/2022


JUDGMENT

Rule. Rule is made returnable forthwith. Heard finally with

the consent of learned counsel appearing for the rival parties.

2. The question that arises for consideration in these petitions

is, as to whether the petitioner is justified in claiming that the

fourth respondents in these petitions had incurred disqualification

from continuing as Members of the Executive Committee / Board

of Directors of the respondent No.3 - Bhandara Urban Co-

operative Bank Limited, by operation of Bye-law Nos. 40 and 45

of the Bye-laws of the said Co-operative Bank.

3. On a complaint lodged by the petitioner, who himself was

elected as Member of the Executive Committee and Director of the

respondent No.3 - Co-operative Bank, on 07/07/2015, for a

period of five years, the respondent No.2 - Divisional Joint

Registrar, Co-operative Societies, held that the fourth respondents

in these petitions had incurred disqualification and accordingly 5 CORRECTED-wp-3557-2021-J.odt

passed orders disqualifying them from continuing as Members of

the Executive Committee / Directors. Aggrieved by such orders

passed by the respondent No.2, the fourth respondents in these

petitions filed revision petitions before the respondent No.1 -

State. The revision petitions were allowed and the orders of

disqualification were quashed and set aside.

4. Aggrieved by the said orders passed by the Hon'ble Minister

for the State of Maharashtra, the petitioner filed these petitions,

wherein notices were issued for final disposal. The respondents

entered appearance through counsel and the petitions were taken

up for hearing.

5. The petitioner and fourth respondents in these petitions

were elected on 07/07/2015, as Members of the Executive

Committee / Directors of the respondent No.3 - Co-operative

Bank for a period of five years. The aforesaid period expired in

July, 2020, but, by operation of Section 73(AAA)(3) of the

Maharashtra Co-operative Societies Act, 1960 (Act of 1960), the

elected members continued as members and office bearers of the

Committee. It was during such period that the petitioner 6 CORRECTED-wp-3557-2021-J.odt

submitted representations / applications before the respondent

No.2 - Divisional Joint Registrar of Co-operative Societies for

disqualification of the fourth respondents in these petitions, for

having incurred disqualification under the bye-laws of respondent

No.3 - Co-operative Bank. Upon the fourth respondents in these

petitions being put to notice, they appeared before the respondent

No.2. The contention of the petitioner against the fourth

respondents was that since they had fallen foul of bye-law 45(1)(n)

of the bye-laws of the respondent No.3 - Co-operative Bank, they

had incurred disqualification, as they had failed to maintain

deposits as per bye-law No. 40 of the aforesaid bye-laws. The

petitioner had also claimed that the fourth respondents had

incurred disqualification for having failed to join monthly board

meetings. But, in the present petitions, the said ground is not the

bone of contention and the only ground pressed on behalf of the

petitioner pertains to disqualification incurred by the fourth

respondents under bye-law No. 45(1)(n) of the said bye-laws.

6. In terms of the replies filed by the fourth respondents and

the material placed on record before the respondent No.2, it was 7 CORRECTED-wp-3557-2021-J.odt

found that at the relevant point in time the fourth respondents had

indeed failed to maintain deposits as specified in bye-law No.40 of

the aforesaid bye-laws. Although later the short fall was made

good, it was found that the fourth respondents had incurred

disqualification. On this basis, by orders dated 19/03/2021, the

respondent No.2 disqualified the fourth respondents from

continuing as Members of the Executive Committee / Directors of

the respondent No.3 - Co-operative Bank.

7. Aggrieved by the said orders passed by the respondent No.2,

the fourth respondents filed revision petitions before the

respondent No.1 - State, which were taken up for consideration by

the concerned Minister. By the impugned orders dated

05/07/2021, the Minister allowed the revision petitions and set

aside the orders of disqualification passed by respondent No.2. It

was held that even if the fourth respondents had indeed failed to

maintain the deposits as mandated under bye-law No. 40 of the

aforesaid bye-laws, since they had immediately made good the

shortfall, it could not be said that disqualification was incurred.

On this basis, the revision petitions stood allowed. According to 8 CORRECTED-wp-3557-2021-J.odt

the petitioner, the impugned orders passed by the Minister of the

concerned Department are wholly unsustainable and deserve to be

set aside.

8. Mr. Akshay Naik, learned counsel appearing for the

petitioner in all the petitions submitted that a perusal of bye-law

No.40 of the bye-laws of the respondent No.3 - Co-operative

Bank, would show that for a Member of the Executive

Committee / Director, it was mandatory to maintain model share

amount of Rs.10,000/- and model deposit amount of Rs.50,000/-.

The note appended to the aforesaid bye-laws mandated that the

elected Directors shall keep the said deposits for the entire tenure

of the Board. Emphasis was also placed on bye-law No.45(1)(n) of

the said bye-laws, contending that if the elected Director

withdraws eligible deposits as per bye-law No.40, at any time

before the completion of the entire tenure of the board, such

Director would incur disqualification.

9. Thereupon, the learned counsel appearing for the petitioner

invited attention of this Court to the material on record to

demonstrate that by specific applications filed by the fourth 9 CORRECTED-wp-3557-2021-J.odt

respondents, such model share capital in the case of the petitioner

in Writ Petition No.3557/2021 and model deposits in the cases of

the fourth respondents in Writ Petition Nos.3558/2021,

3559/2021 and 3560/2021, were withdrawn, as a result of which

disqualification was instantly incurred under bye-law No. 45(1)(n)

of the said bye-laws.

10. It was submitted that even though the fourth respondents

thereafter made good the shortfall by replenishing the amounts, the

disqualification already incurred could not be undone. The learned

counsel emphasized upon Section 73CA (1) (f) (iv) of the Act of

1960, as it stood prior to the amendment dated 28/03/2022, read

with Rule 58 of the Maharashtra Co-operative Societies Rules,

1961 (Rules of 1961), to contend that disqualification was incurred

and that, therefore, the respondent No.2 had correctly passed

orders of disqualification against the fourth respondents. It was

submitted that the Minister was not justified in reversing the

orders passed by the respondent No.2 and allowing the Revision

petitions of the fourth respondents, by simply stating that although

the mandatory deposits were inadvertently withdrawn, they were 10 CORRECTED-wp-3557-2021-J.odt

later made good.

11. The learned counsel appearing for the petitioner further

submitted that although the term of the Executive Body had

expired in July, 2020, by operation of provisos to Section 73AAA

(3) of the Act of 1960, the term was extended and, therefore, it

could not be said that disqualification proceedings could not be

initiated as the five year term was already over. The learned counsel

appearing for the petitioner relied upon judgment of the Hon'ble

Supreme Court in the case of Rajendra Singh Rana and others Vs.

Swami Prasad Maurya and others reported in (2007) 4 SCC 270

and judgments of this Court in the cases of Sambha s/o Gangaram

Pikale Vs State of Maharashtra and others reported in 1996(2)

Mh.L.J. 182 and Pundlik Kadhav Vs. District Deputy Registrar,

Co-operative Societies, Chandrapur and others, reported in 1990

Mh.L.J. 925

12. On the other hand, Mr. A. M. Ghare, learned counsel

appearing for the contesting fourth respondents in all these

petitions submitted that the disqualification proceedings were

themselves stillborn, because the five year term of the elected body 11 CORRECTED-wp-3557-2021-J.odt

was admittedly over in July, 2020 itself. It was submitted that the

petitioner filed the complaints / representations after the expiry of

the five year term and show cause notices were also issued by the

respondent No.2 after the said term had expired. By referring to

proviso to Section 73AAA(3) of the said Act, it was submitted that

merely because the Executive Committee was deemed to have been

continued and the fourth respondents continued as members till

the new committee was duly constituted, it could not be said that

disqualification proceedings could be initiated against them.

13. On the aspect of attracting disqualification by operation of

bye-law Nos.40 and 45(1)(n) of the said bye-laws, it was submitted

that the material on record clearly indicated that the deposits stood

withdrawn due to the mistake of the Manager and when the same

was realized, the fourth respondents immediately made good the

shortfall in the deposits, thereby showing that no disqualification

was incurred. It was submitted that the situation created by such

inadvertent withdrawal of deposits was curable and this could be

inferred from the provisions pertaining to a member classified as

non-active member, again becoming an active member upon 12 CORRECTED-wp-3557-2021-J.odt

making good the deficiency. In this context, reference was made to

Section 73CA(1)(ii-a) read with Section 26(2)(b) of the said Act,

as they stood prior to the amendment brought into effect on

28/03/2022.

14. It was further submitted that the amendment made effective

from 28/03/2022, for the first time introduced the words "or bye-

laws of the Society" in Section 73CA(i)(f)(iv) of the said Act and

since the proceedings for disqualification in the present cases were

initiated prior to the amendment, disqualification could have been

incurred only under the provisions of the Act and Rules. It was

submitted that reliance placed on Rule 58 of the aforesaid Rules

was completely misplaced because the Rule could not override the

substantive provision of the Act, as it existed at the relevant point

in time. On this basis, it was submitted that when the concerned

Minister had allowed the revision petitions, based on a reasonable

and proper interpretation of the Act, Rules and the bye-laws of the

respondent No.3 - Co-operative Bank, no case was made out for

exercise of writ jurisdiction to set aside the said orders passed by

the concerned Minister.

13 CORRECTED-wp-3557-2021-J.odt

15. Mr. Tidke, learned counsel appeared on behalf the

respondent No.3 - Co-operative Bank and supported the

contentions raised by Mr. Ghare, learned counsel for the fourth

respondents in these petitions. Mr. N.R. Rode, learned Assistant

Government Pleader appeared on behalf of the respondent Nos.1

and 2 and submitted that since no relief had been claimed against

the said respondents, this Court may pass appropriate orders in the

light of the provisions of the aforesaid Act, Rules, as also the bye-

laws of the respondent No.3 - Co-operative Bank.

16. Having heard the learned counsel for the rival parties, it

would be appropriate to refer to the relevant provisions of the

aforesaid Act and Rules, as they stood at the relevant time, as also

the relevant bye-laws of the respondent No.3 - Co-operative Bank.

17. The relevant provisions of the Act read as follows:

"26 Rights and duties of members (1) A member shall be entitled to exercise such rights as provided in the Act, rules and by-laws:

Provided that, no member shall exercise the rights, until he has made such payment to the society in respect of membership, or acquired such interest in the society, as may be prescribed and specified under the by-laws of the society, from time to time : Provided further that, in case of increase in minimum contribution of member in share capital to exercise right of membership, the society give a due notice of demand to the members and give 14 CORRECTED-wp-3557-2021-J.odt

reasonable period to comply with.

(2) It shall be the duty of every member of a society, -

(a) to attend at least one general body meeting within a consecutive period of five years :

Provided that, nothing in this clause shall apply to the member whose absence has been condoned by the general body of the society.

(b) to utilize minimum level of services at least once in a period of five consecutive years as specified in the by-laws of the society; Provided that, a member who does not attend at least one meeting of the general body as above and does not utilise minimum level of services at least once in a period of five consecutive years, as specified in the by-laws of such society shall be classified as non- active member :

Provided further that, when a society classifies a member as a non- active member, the society shall, in the prescribed manner communicate such classification, to the concerned member within thirty days from the date of close of the financial year : Provided also that, a non-active member who does not attend at least one meeting of the general body and does not utilise minimum level of services as specified in the by-laws, in next five years from the date of classification as non-active member, shall be liable for expulsion under section 35:

Provided also that, a member classified as non-active member shall, on fulfillment of the eligibility criteria as provided in this sub- section be entitled to be re-classified as an active member. Provided also that, if a question of a member being active or non- active member arises, an appeal shall lie to the Registrar within a period of sixty days from the date of communication of classification.

Provided also that, in any election conducted immediately after the date of commencement of the Maharashtra Co-operative Societies (Amendment) Act, 2013, all the existing members of the society shall be eligible for voting, unless otherwise ineligible to vote.

73AAA Constitution of committee
(1) xxxx
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(2) xxxx

(3) The term of the office of the elected members of the committee and its office bearers shall be five years from the date of election and the term of the office bearers shall be co-terminus with the term of the committee and on the expiry of the term of the committee, the members shall be deemed to have vacated their offices as members of the committee.

Provided that, if the term of office of the elected members of the committee and its office bearers has expired, and if the election to the committee of the society could not be held due to imposition of lockdown in the State in view of the Covid-19 pandemic, the orders issued by the Government, from time to time, or any reason not attributable to the members of the committee of the society, such members and office bearers of the committee shall be deemed to have continued as members and office bearers of the committee till new committee is duly constituted.

"73CA. Disqualification of committee and its members. (1) Without prejudice to the other provisions of this Act or the rules made thereunder in relation to the disqualification of being member of a committee, no person shall be eligible for being appointed, nominated, elected, co-opted or, for being a member of a committee, if he -

(i) xxx

(a) xxx

(b) xxx

(c) xxx

(d) xxx

(e) xxx

(f) In the case of District Central Co-operative Bank or of the State Co-operative Bank, a member, if he, -

xxx (ii-a) has been classified as non-active member under sub-section (2) of section 26; or xxx

(iv) has incurred any disqualification under this Act or the rules made thereunder; or"

16 CORRECTED-wp-3557-2021-J.odt

18. Rule 58 of the aforesaid Rules reads as follows:

"58. Disqualification of committee and its membership When on communication by the Chief Executive Officer of society or otherwise, the Registrar comes to know that any member of the committee incurs disqualification as mentioned in section 73CA and the Bye-laws, the Registrar shall, after giving an opportunity of being heard, issue an order of cessation of membership of such member from the committee of the society:

Provided that, the Registrar shall decide the matter within sixty days from the date of such communication or otherwise."

19. The relevant bye-laws of respondent No.3 - Co-operative

Bank read as follows:

"40. ELIGIBILITY OF BOARD OF DIRECTORS:

To contest the election of Board of Directors, the active member should comply following model criteria depending upon the size of Banks

Sr. Bank Category Model share Amt. Model Deposit No. (Deposit in Cr.) (In Rs.) Amt.

                                                            (In Rs.)
      1    Upto Rs.100 Cr.    5000             And           25000
      2    Rs. 100.00 Cr. to 10000             And           50000
           Rs.50.00 Cr.
      3    More        than 15000              And           100000
           Rs.500.00 Cr.

(Note : The elected directors shall keep the above deposits for the entire tenure of the board) The persons contesting from reserve seat under section 73B and 73C shall comply with 50% of the criteria required for general category."

      "45. DISQUALIFICATION FOR BEING A MEMBER OF
      THE BOARD
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45(1) No member of the Bank shall be eligible for being elected, or for being a member of the Board if such member xxx

(n) If he withdraws the eligible deposits as per Bye Law No.40 any time before the completion of the entire tenure of the board."

20. The principal contention raised on behalf of the fourth

respondents in all these petitions was that the orders of

disqualification could not have been passed against them, for the

reason that the five year term of the elected Executive Body of the

respondent No.3 - Co-operative Bank was already over in July,

2020. As the term had expired, there was no question of initiation

of disqualification proceedings on the basis of alleged violation of

bye-laws Nos.40 and 45 of the bye-laws of respondent No.3 - Co-

operative Bank. In this context, Section 73(AAA) of the aforesaid

Act, relevant portion of which is quoted hereinabove, is significant.

Subsection (3) of Section 73 (AAA) of the said Act, read with the

first proviso thereto shows that when the term of the elected

Executive Body of a Co-operative Society expired and elections

could not be held due to the Covid-19 pandemic, the Members of

such Executive Committee as Directors shall be deemed to have 18 CORRECTED-wp-3557-2021-J.odt

continued as Members of the Committee till a new Committee

stood duly constituted. Being a deeming fiction, which necessarily

implies that a situation that factually does not exist is deemed to be

existing, it indicates that although the five year term of the elected

Executive Body of the respondent No.3 - Co-operative Bank had

expired in July, 2020, by the operation of the aforesaid proviso to

Section 73AAA(3) of the said Act, the fourth respondents were

deemed to have continued as members and office bearers of the

Committee. Even otherwise, the words used in bye-law No.40 and

bye-law No.45(1)(n) of the said bye-laws to the effect "entire

tenure of the Board" mandatorily requires adherence to the bye-

laws throughout the "tenure" of the elected members of the

Executive Body, in order to avoid disqualification.

21. Even if the contentions raised on behalf of the fourth

respondents in these petitions is to be accepted that the "term" of

the elected body of the Executive Committee was only five years,

which expired in July, 2020 and proviso to Section 73AAA(3) of

the said Act merely continued the fourth respondents as Members

of the Executive Committee, such continuance clearly continued 19 CORRECTED-wp-3557-2021-J.odt

the tenure of the elected board and the membership of the fourth

respondents of such elected body / board. Therefore, there is no

substance in the contention raised on behalf of the fourth

respondents that since the five year term of the elected

Committee / Board had expired in July, 2020, no proceeding for

disqualification could be initiated against them under bye-law

Nos.40 and 45 of the said bye-laws. By operation of proviso to

Section 73AAA(3) of the said Act, when the fourth respondents

were deemed to have continued as Members of the Executive

Committee / Board and they enjoyed all the privileges of the same,

it cannot be said that they would not incur disqualification by

operation of bye-law Nos.40 and 45 of the aforesaid bye-laws.

22. In this backdrop, it needs to be examined as to whether the

concerned Minister, while passing the impugned orders was

justified in reversing the orders passed by the respondent No.2 -

Divisional Joint Registrar. Bye-law No.40 read with 45(1)(n) of

the said bye-laws shows that it mandatorily requires the elected

members of the Executive Committee / Directors of the

respondent No.3 - Co-operative Bank to necessarily keep the 20 CORRECTED-wp-3557-2021-J.odt

deposits pertaining to model share amount and model deposits,

alive throughout their tenure as Members of the Executive

Committee / Directors of the Board. The moment such deposits

fell short of the minimum prescribed in bye-law No.40, the

concerned elected members immediately attracted disqualification.

23. In the present case, it is not disputed that insofar as the

petitioner in Writ Petition No.3557/2021, is concerned, the model

share amount fell short of the prescribed minimum in bye-law

No.40 of the said bye-laws and insofar as petitioners in other writ

petitions are concerned, model deposit amounts fell short and

below the minimum prescribed under the said bye-laws. Such

withdrawal of the amounts was approved by specific resolutions

passed in meetings of the Board of Directors and there is no

dispute about the same. This Court is of the opinion that the

moment the said event occurred of the deposits falling below the

minimum prescribed under bye-law No.40 of the said bye-laws,

the fourth respondents incurred disqualification. Subsequent

replenishment of the deposits to satisfy the bare minimum

requirement of the bye-law No.40 of the said bye-laws would not 21 CORRECTED-wp-3557-2021-J.odt

cure the defect or reverse the disqualification already incurred by

the fourth respondents. The learned counsel appearing for the

fourth respondents in these petitions is not correct in contending

that the disqualification so incurred was curable.

24. The contention raised on behalf of the fourth respondents

that the question as to whether they had incurred disqualification,

in the facts of the present cases, ought to be examined at the time

when the Divisional Joint Registrar considered the matters, is also a

fallacious contention, for the reason that the aforesaid aspect has to

be examined at the point in time when the fourth respondents had

allegedly incurred disqualification under the bye-laws of the

respondent No.3 - Co-operative Bank. In this regard, the learned

counsel appearing for the petitioner is justified in placing reliance

on the Constitution Bench Judgment of the Hon'ble Supreme

Court in the case of Rajendra Singh Rana and others Vs. Swami

Prasad Maurya (supra). In the said case, one of the questions for

consideration was, as to whether the aspect of a Legislator

incurring disqualification was to be considered at the point when

he or she defied the whip or the aspect was to be examined when 22 CORRECTED-wp-3557-2021-J.odt

the Speaker at a subsequent point in time was considering the

question of disqualification. In this context, the Hon'ble Supreme

Court in the said case held as follows:

"34. As we see it, the act of disqualification occurs on a member voluntarily giving up his membership of a political party or at the point of defiance of the whip issued to him. Therefore, the act that constitutes disqualification in terms of paragraph 2 of the Tenth Schedule is the act of giving up or defiance of the whip. The fact that a decision in that regard may be taken in the case of voluntary giving up by the Speaker at a subsequent point of time cannot and does not postpone the incurring of disqualification by the act of the Legislator. Similarly, the fact that the party could condone the defiance of a whip within 15 days or that the Speaker takes the decision only thereafter in those cases, cannot also pitch the time of disqualification as anything other than the point at which the whip is defied. Therefore, in the background of Page 1013 the object sought to be achieved by the Fifty Second Amendment of the Constitution and on a true understanding of paragraph 2 of the Tenth Schedule, with reference to the other paragraphs of the Tenth Schedule, the position that emerges is that the Speaker has to decide the question of disqualification with reference to the date on which the member voluntarily gives up his membership or defies the whip. It is really a decision ex post facto. The fact that in terms of paragraph 6 a decision on the question has to be taken by the Speaker or the Chairman, cannot lead to a conclusion that the question has to be determined only with reference to the date of the decision of the Speaker. An interpretation of that nature would leave the disqualification to an indeterminate point of time and to the whims of the decision making authority. The same would defeat the very object of enacting the law. Such an interpretation should be avoided to the extent possible. We are, therefore, of the view that the contention that only on a decision of the Speaker that the disqualification is incurred, cannot be accepted. This would mean that what the learned Chief Justice has called the snowballing effect, will also have to be ignored and the 23 CORRECTED-wp-3557-2021-J.odt

question will have to be decided with reference to the date on which the membership of the Legislature party is alleged to have been voluntarily given up."

25. Applying the position of law laid down in the above quoted

judgment, it becomes clear that in the present cases, even if the

fourth respondents had subsequently replenished the deposits

above the minimum required as per bye-law No.40 of the said bye-

laws and before the respondent No.2 - Divisional Joint Registrar

considered the question, it could not be said that they did not incur

disqualification. This Court is of the opinion that disqualification

once incurred in such a manner could not have been reversed by

subsequent replenishment of the deposits and that the concerned

Minister erred in passing the impugned orders in favour of the

fourth respondents in these petitions, only because they did

replenish the deposits above the minimum required at a

subsequent point in time.

26. It was argued on behalf of the fourth respondents by relying

upon unamended Section 73CA(1)(f)(iv) of the said Act, since the

words "or bye-laws of the Society" were added only by the

subsequent amendment which came into effect from 28/03/2022, 24 CORRECTED-wp-3557-2021-J.odt

that the aforesaid provision as it stood when the question of

disqualification of the fourth respondents came up for

consideration concerned disqualification that could be incurred

only under the Act and Rules and not the bye-laws of the Society.

In this regard, reliance placed on Rule 58 of the aforesaid Rules on

behalf of the petitioner is justified because the said Rule clearly

provides for disqualification as mentioned in Section 73CA and

the bye-laws of the concerned Society. The fourth respondents are

not justified in contending that Rule 58 of the said Rules goes

beyond what the Act provided at the relevant time and the same

ought to be ignored because Rules framed under the Act cannot go

beyond the substantive provisions of the main statute.

27. The position of law in this regard is clearly covered in favour

of the petitioner as per the judgment of this Court in the case of

Sambha s/o Gangaram Pikale Vs State of Maharashtra (supra),

wherein it was held as follows:

"5. Shri Talekar submitted that since disqualifications have been prescribed under section 73-FF and section 73-FFF of the Act of 1960 and under Rule 58 of the Maharashtra Co-operative Societies Rules, 1961, no further qualifications can be laid down under the bye-laws. The argument is fallacious. What has been prescribed in the Act and Rules are the minimum things which 25 CORRECTED-wp-3557-2021-J.odt

cannot be given go by any Co-operative Society. Therefore, disqualifications as are laid down in the Act and Rules cannot be watered down by the Society by framing bye-laws contrary to it. But it does not mean that the additional qualifications cannot be prescribed under the bye-laws. In many cases, qualification in respect of residence is prescribed. In many cases, number of shares which should be held by a member for being entitled for election as Director are also prescribed. It cannot be said that no additional qualifications can be prescribed under the rules. It would be within the jurisdiction of the Registrar to examine whether the bye-laws including such qualifications are proper and reasonable. Since the present bye-law is approved by the Registrar, it can well be presumed that the Registrar has accepted its necessity."

28. Thus, the said contention raised on behalf of the fourth

respondents is also rejected.

29. The contention raised on behalf of the fourth respondents by

relying upon Section 26(2)(b) and the proviso appended thereto

read with Section 73CA(1)(f)(ii-a) of the said Act is also not

justified. It is contended that since it is specified under the

aforesaid provisions that a non-active member can become an

active member and such reclassification is permissible, the

disqualification that may have been incurred by the fourth

respondents under bye-law No.40 read with 45(1) of the aforesaid

bye-laws, could be cured and the fourth respondents stood

reclassified as members of the Executive Committee / Directors of 26 CORRECTED-wp-3557-2021-J.odt

the Board. As noted hereinabove, once the disqualification stood

incurred by operation of the aforesaid bye-laws and such a finding

is found to be justified on facts, the said disqualification cannot be

reversed, even if subsequently the petitioners replenished the

deposits to the minimum required under bye-law No.40 of the

aforesaid bye-laws. It is clear that the default on the part of the

fourth respondents in maintaining the deposits mandatorily

required under bye law No.40 of the bye-laws resulted in

disqualification on the day such default happened. Therefore, there

is no question of the said disqualification being reversed or cured

by subsequent action of the fourth respondents. Reliance placed

on behalf of the petitioner on the judgment of this Court in the

case of Pundlik Kadhav Vs. District Deputy Registrar, Co-

operative Societies, Chandrapur (supra) is also justified.

30. The concerned Minister in the impugned orders completely

failed to appreciate the correct position of law and wrongly held

that the deposits of the fourth respondents, which had

inadvertently gone below the minimum required under the

aforesaid bye-law, were subsequently made good and, therefore, it 27 CORRECTED-wp-3557-2021-J.odt

could not be said that the fourth respondents had incurred

disqualification. The said finding of the concerned Minister is

found to be unsustainable and, therefore, the impugned orders

deserve to be set aside.

31. In view of the above, the writ petitions are allowed.

32. The impugned orders passed by the respondent No.1 i.e. the

concerned Minister of the State are quashed and set aside and the

orders passed by the respondent No.2 - Divisional Joint Registrar,

disqualifying the fourth respondents are restored. No costs.

33. Rule is made absolute in above terms. Pending applications,

if any, stand disposed of.

JUDGE Later on On pronouncement of judgment, the learned counsel appearing for the fourth respondents in all these petitions requested for suspension of the order passed today by this Court. Since this Court has held that in the facts of the present cases, disqualification was incurred by the fourth respondents, the moment bye-law No.45(1)(n) came into operation read with bye- law No.40, this Court sees no reason to accept the prayer.

28 CORRECTED-wp-3557-2021-J.odt

Hence, the prayer for suspension of the order is rejected.

JUDGE

MP Deshpande

Digitally signed by:MILIND P DESHPANDE Signing Date:29.09.2022 16:18