Bombay High Court
Smt. Shantabai Magru Bawane, And Anr vs The State Of Maharashtra Through Its ... on 27 January, 2025
Author: M.S. Sonak
Bench: M.S. Sonak
2-WP-4547-2018-F.DOCX
2025:BHC-AS:4259-DB
Darshan Patil
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO. 4547 OF 2018
Shantabai Magru Bawane and anr. ...Petitioners
Versus
The State of Maharashtra and Ors. ...Respondents
WITH
INTERIM APPLICATION NO. 2670 OF 2023
WITH
INTERIM APPLICATION NO. 14921 OF 2023
WITH
INTERIM APPLICATION (ST) NO. 2650 OF 2024
IN
WRIT PETITION NO. 4547 OF 2018
______________________________________________________
Mr A M Ghare, for the Petitioners.
Mr Kaustubh Deogade, for the Applicant in IA/2670/2023.
Mr A D Gabhane, for Respondent No.3.
Dr Birendra B Saraf, AG, a/w Ms Neha Bhide, GP, a/w S
Kankar, AGP, Mr Y D Patil, AGP, for the Respondent-
State.
______________________________________________________
CORAM: M.S. Sonak &
Jitendra Jain, JJ.
DATED: 27 January 2025
ORAL JUDGMENT:- PER MS Sonak, J
1. Heard Mr Ghare, learned counsel for the petitioners,
learned Advocate General for the respondent-State, Mr
Gabhane learned counsel for respondent No.3 and Mr
2-WP-4547-2018-F.DOCX
Deogade learned counsel for the interveners/applicant in
Interim Application No. 2670 of 2023.
2. This petition had challenged the constitutional validity
of the first proviso to Section 73AAA (1) and the deletion of
the provision for reservation of candidates belonging to the
Economically Weaker Section (EWS) from Section 73B of the
Maharashtra Co-Operative Societies Act, 1960 ("Said Act").
3. Based on an interim order dated 21 July 2017 granted
by this Court, the board of directors of the third respondent-
cooperative bank continues to manage the affairs of the third
respondent-cooperative bank. The elections to the board of
directors of the third respondent were held in 2012. The term
of this board of directors expired in 2017. Based only on an
interim order made by this Court, the members elected in
2012 continued to manage the affairs of the third respondent-
cooperative bank.
4. In the case of Baburao s/o Banduji Kubde Vs. Yavatmal
District Central Cooperative Bank Limited & Ors., in Special
Leave to Appeal(c) No. 8004 of 2019, the Hon'ble Supreme
Court made an order on 25 November 2019 directing the
holding of elections as expeditiously as possible, once the
term of elected members of the board of directors comes to an
end. The Hon'ble Supreme Court held that in a democracy,
elections must be held within the time prescribed by law. It is
only in exceptional circumstances that elections can be
delayed. All bodies elected by the democratic process must
not continue after their term is completed and the rule of law
requires that fresh elections be held. Hon'ble Supreme Court
expressed surprise that in the case before it, where the bank
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itself had approached for directions to hold the elections
instead of allowing the bank's writ petition, interim relief was
granted, resulting in a restraint on the holding of elections.
Accordingly, the interim order was vacated, and directions
were issued for holding elections and completing the same
before 28 February 2020.
5. Mr Ghare learned counsel for the petitioners, on
instructions, states that the petitioners do not wish to press
the challenges to the constitutional validity or the other
challenges now raised in this petition. On instructions, he
states that this petition could be disposed of by directing the
State Cooperative Election Authority ("Authority") to hold
elections in accordance with law as expeditiously as possible.
However, he points out that in terms of Section 73AAA (3)
and the first proviso to this provision, members and office
bearers of the committee shall be deemed to have continued
as members and office bearers until the new committee is
duly constituted. He, therefore, submits that members and
office bearers presently managing the affairs of the third
respondent bank should be allowed to continue until a newly
elected committee of the board of directors assumes office.
6. Mr Saraf, the learned Advocate General, submits that
this petition could be disposed of by directing the Authority to
hold and conclude elections for constituting the committee of
members or the board of directors to the third respondent-
cooperative bank within a maximum period of 6 months from
today. He pointed out that the committee members who
continue to govern the affairs of the third respondents have
no significant say or control in such elections. The Authority
which conducts the election is an independent authority, and
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the elections would be held freely, independently, and
lawfully. The learned Advocate General left the issue of
present committee members continuing to the decision of the
Court.
7. Mr Deogade, learned counsel for the intervener,
submitted that there should be no difficulties if directions are
issued for completing the election process within six months
from today. However, he submitted that there are serious
allegations of misappropriation, etc., against the present
committee members. He submitted that the Hon'ble Supreme
Court has held that no sooner the term of the committee
members expires, an administrator should be appointed, and
elections should be held. He further submitted that present
committee members should not be allowed to continue any
further now that their term has expired in 2017. He submitted
that suitable directions may be issued for the appointment of
administrator so that the elections can be free, fair and
independent.
8. We have considered the rival contentions.
9. Now that the petitioners are not pressing the challenge
in this petition, we dispose of this petition by directing the
Authority to initiate and conclude the election process for
constituting a committee or board of directors to the third
respondent cooperative bank within a maximum period of 6
months from today. This means that the necessary notification
for starting the election process must be issued within a
maximum of 1 month from today. The election process must
be completed with the declaration of election results within a
period of a maximum of 6 months from today.
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10. The interim relief granted by this Court has continued
since 2017. The intervention application was filed in 2023.
The intervener has not bothered to challenge the interim
order granted by this Court. The intervener is pursuing the
complaints against the elected members. Mr Ghare submitted
that even the intervener is a retired CEO of the bank against
whom there are proceedings for recovery of about Rs.3
Crores.
11. Therefore, considering the proviso of Section 73AAA(3)
of the Said Act, we do not think it would be appropriate to
displace the elected committee members and replace them
with an administrator. The learned Advocate General assured
us that these committee members will have no significant say
in the conduct of the elections that are now required to be
completed within 6 months. Mr Ghare has assured the Court
that the committee members would fully cooperate in holding
elections and not create any hurdles so that they could
continue in management.
12. Accordingly, present committee members are allowed to
continue only for 6 months from today. If, for any reason, the
elections are not concluded within 6 months from today or
the newly elected body does not take charge within this
period of 6 months from today, then it will be open to the
State Government to appoint an administrator to take over
the affairs of the third respondent cooperative bank. This is
because the elected members whose terms have already
expired cannot be allowed to continue either indefinitely or by
creating a situation whereby no elected body is available to
take charge of the affairs of the cooperative bank.
2-WP-4547-2018-F.DOCX
13. Besides, during this six-month period, we restrain the
present committee members from making major policy
decisions or spending any amounts for purposes other than
routine operational expenses. The committee members must
be conscious that their terms have already expired. In that
sense, they are not continuing as per the wishes of their
voters. Therefore, there is no question of them taking any
major policy decisions or unduly expending bank finances for
purposes other than routine operational purposes.
14. The Divisional Registrar, the 2nd respondent, must
ensure that no major policy decisions are made and maintain
control over this committee's spending of the bank's funds. If
the 2nd respondent finds that any undue expenditures are
being made, the Divisional Registrar must take steps to
prevent this. Liberty is also granted to the Divisional Registrar
to apply to this Court, including directions for the
appointment of an administrator if the need arises.
15. The committee members now allowed to continue for 6
months must fully cooperate with the authority so that the
elections can be held and concluded within 6 months. This
includes providing funds for the conduct of elections and
submitting the provisional voter lists. All this exercise must be
completed within 15 days of the Authority starting the
process, demanding the election funds, and furnishing the
provisional voter lists. The Authority must also issue these
directions as soon as possible, in any event, within 15 days
from today.
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16. Now that we have heard the counsel for the intervener,
Interim Application No. 2670 of 2023 is disposed of in the
above terms.
17. The State Government's Interim Application (ST) No.
2650 of 2023, filed to vacate the interim relief, is also
disposed of, given the above order.
18. Interim Application No. 14921 of 2023 is also for
vacating the interim relief. Given our above order, even this
application is disposed of.
19. This Writ Petition is disposed of. The rule is disposed of
in the above terms. Interim orders granted by us are vacated.
20. All concerned to act on the authenticated copy of this
order.
(Jitendra Jain, J) (M.S. Sonak, J)
Signed by: Darshan Patil
Designation: PA To Honourable Judge
Date: 29/01/2025 18:22:53
