Suresh Chand Jain vs Lt. Governor
1991 Latest Caselaw 703 Del

JUDGMENT

D.P. Wadhwa, J.

(1) This petition u/Art. 226 of the Constitution has been filed seeking writ of mandamus directing the second respondent. Assistant Registrar of Cooperative Societies and Returning Officer to conduct election of the Board of Directors of Jai Lakshmi Coop. Bank Ltd. as per law and a further direction to him to accept the nomination papers of petitioners 1 and 2 for the posts of Chairman and Director of the Bank. Yet another direction sought is that nomination papers filed by respondents 3 to 5 for the posts of Directors be rejected.

(2) The bank is a Society registered under the Delhi Cooperative Societies Act, 1971 (the 'Act') and for the purpose of election and nomination of its Board of Directors is governed by S. 31 of the Act. This Board is a Committee as defined in S. 2(b) of the Act. The Committee has been defined in S. 2(b) of the Act meaning the governing body of a coop. society, by whatever name called, to which the management of the affairs of the society is entrusted. The Board comprises of 11 members. If reference is made to Bye-law 22 of the bye-laws of the Society, all the Directors shall be elected in the general meeting. Out of these 11 Directors, one is to be elected as Chairman, the other Vice-Chairman, the third Secretary and the fourth as Treasurer. There is some controversy if the Secretary and Treasurer are to be elected by the general body or if they are to be elected by the Board itself.

(3) Petitioner 1 filed his nomination paper for the post of Chairman and petitioner 2 for the post of Director. The third petitioner is a member of the Society. He, however, did not file his nomination for any post. The first respondent is Lt. Governor of Delhi, the second respondent is the Returning Officer and also working as Asstt. Registrar, Cooperative Societies and respondents 3, 4 and 5 are the members of the Society, whose nomination to the post of Director is being challenged. Respondent No. 6 was added by an order of this Court at a subsequent stage and he is also a member of the Society. The nomination paper of this respondent was, however, accepted for the post of Chairman.

(4) The Returning Officer issued programme of election to the Board of Directors of the Society. This is Annexure 'P. 1' to the W.P. After the list of valid nominations was displayed, petitioners 1 and 2 did not find their names. They made inquiries and were told that the first petitioner was ineligible on account of S. 35(5) of the Act and petitioner 2 was ineligible on account of Rule 59 (b) read with Rule 61 (b) of the Rules framed under the Act. Thereafter, it appears that only respondent 6 was left in the field for the post of Chairman. This led to the filing of the present W.P. After notice to show cause as to why rule nisi be not issued was given, the respondents filed their respective answers to show cause notice. By order dated 28.6.91 Rule D.B. was issued. The election which was scheduled to be held for 30.6.91 was allowed to be so held except it was ordered that the result shall not be declared till further orders. Thereafter certain interim orders were made restraining disbursement of loans by certain office bearers of the bank which in effect put restraint on the bank itself. This made the bank to file an application (C.M. 4578/91) seeking modification of this order.

(5) Respondent 2 in his affidavit has submitted that his interpretation of S. 31(5) is correct and that petitioner 1 was ineligible to contest for the post of Chairman. As regards petitioner 2, it is not disputed that he is a party to a contract of lease of the property where the bank is situated, being one of the Lessers thereof. Respondent 2 has further stated that when he came to know that respondents 3, 4 & 5 were also ineligible to stand for election u/R. 59 (k) he deleted their names from the valid list of nominations. [In para 6, S. 31(5) is reproduced]

(6) It is an admitted case that the first petitioner was earlier Secretary and then Vice-chairman for two consecutive years and for a short period a Chairman. The Chairman had since resigned. The dispute revolves on the interpretation of the words "any such office appearing in S. 31(5)(a). The respondents contend that this will apply to whatever post a member held consecutively for two terms, for example, whether as Chairman for both the terms or as Chairman once and any other post for the other term. The petitioners say that this interpretation is not correct and that this provision would not debar the first petitioner for being nominated for the post of Chairman. They say bar will come into play only when a candidate for a post should have held that very post for two consecutive terms. As noted above the interpretation given by the second respondent, who is the A.R. of the Co-op. Societies, is in agreement with what has been put by the other respondents. We, however, find ourselves in agreement with the interpretation so put by the petitioners. In our view if the interpretation as suggested by the respondents is correct, then instead of the words "any such office", the words should have been ''any of such offices". In normal circumstances every member has a right to contest any post for any number of terms. This sub-section puts a bar on that right. We do not think we should blockade that right to such a limit as to debar the member from contesting the post which he did not hold consecutively for two terms. A bare reading of whole of S. 31(5) as noted above, leads us to this very conclusion. A person to be disqualified for election to a post must have held that very post consecutively for two terms, whether full or part. An argument was also raised that this sub-section will apply only to those posts for which the election is held by the general body. It was contended that the Secretary and Treasurer were elected by the Board of Directors of the bank and not by the general body. This led us to see the various bye-laws of the Society. Under Bye-law 19 the duties of general body are also to elect, suspend or remove Directors including a Chairman and Vice-Chairman. It was, therefore, submitted by the respondent that it would show that only Chairman and Vice-Chairman and other Directors were to be elected and not that Secretary and Treasurer were also to be elected. Bye-law 22 is, however, quite specific which says that all the Directors shall be elected in the General Body Meeting and four of them will be designated as Director-Chairman, Director-Vice Chairman, Director-Secretary and Director-Treasurer. Option was, however, given to these office bearers not to use the word "Director" along with their names of offices. Under Bye-law 24 the Board of Directors exercise all powers of the bank except those reserved for general body. Reference was then made by the respondent to clauses 24 and 25 of this bye-law where the Board of Directors has been given the power to appoint Treasurer and Secretary and one or more Joint Secretaries. We do not think that the names Treasurers, Secretaries and Joint Secretaries used in these clauses would refer to Director-Secretary and Director-Treasurer as mentioned in bye-law 22 of the Bye-laws. We, therefore, again do not find ourselves in agreement with the interpretation sought to be put by the respondents. In our view, therefore, the nomination papers of the first petitioner were wrongly rejected and he has been deprived of his right to stand election for the post of Chairman.

(7) As regards the second petitioner we do not think much can be said by the petitioners as Rule 59 (b) read with Rule 61 (b) is quite specific which debars a person for being eligible for election as a member of the Committee if he has directly or indirectly any interest in any contract to which the co-op society is a party and the terms "contract" also includes granting of lease of property to the Society. We, therefore, find that the nomination paper of the second petitioner was rightly rejected. [In paras 9 & 10, Respdt. 3 to 5 were held to be ineligible for not being members for 6 months and that W.P. was not barred by alternative remedy u/S. 31(7) of the Act.]