Telangana High Court

Laxmannagari Shashidhar Reddy vs The State Of Telangana on 2 February, 2024

Author: Nagesh Bheemapaka

Bench: Nagesh Bheemapaka

        HON'BLE SRI JUSTICE NAGESH BHEEMAPAKA

            WRIT PETITION No. 31608 OF 2023

ORDER:

In this Writ Petition, petitioner seeks to declare bye-

law 24(viii) of the South Central Railway Employees' Cooperative

Credit Society Limited as it is inconsistent with Section 44(2) of

the Multi-state Cooperative Societies Act, 2002 along with the

Multi-State Cooperative Societies Rules, 2002, as illegal. A

consequential direction is sought to allow petitioner to

participate by accepting his Application without referring by-law

24(viii) of the Act as Board of Director, pursuant to notification

dated 11.11.2023 issued by the 3rd respondent.

2. It is the case of petitioner that he has been working

as Tech-1/DSL/MLY in South Central Railway and participated

in the election of South Central Railway Employee's Co-

operative Credit Society Ltd. in 2013 and 2018 and selected as

Delegate and later as Director to the General Body. It is stated

that the 3rd respondent Society issued notification dated 28-08-

2023 to conduct election of Delegates to the General Body;

election was conducted on 10.10.2023 and 12.10.2023 and

results also were declared and 210 members elected as

Delegates of General Body of the 3rd respondent society.

Petitioner was elected as one of the Delegates for Constituency

No.7.

It is further stated that in continuation of Election

Notice dated 28.08.2023, the 3rd respondent Society issued

another Notification dated 11.11.2023 for conducting elections

to the Directors for the Board of Directors and Office Bearers (21

Board of Directors) on 25.11.2023 through secret ballot system.

In the said notification, the election schedule mentioned, as per

which, issuing and receipt of nomination forms was on

16.11.2023 from 10.00 AM to 5.00 PM and scrutiny of

nominations and publication of valid nominations on

17.11.2023. As per the notification, disqualification for Board of

directors/office bearers is at clause (b) "As per MSCS Act,2002

and registered by laws of the SCR ECCS Ltd". Disqualification

was dealt with in Section 44 (2) of the MSCS Act, 2002 and bye-

law 24 (viii) which is extracted here under:

Section 44: Prohibition to hold office of chairperson or president or vice-chairman or vice president in certain cases:

(2) No member of a board shall be eligible to be elected as the chairperson or president of a multi-state co-operative society, after he has held the office, as such during two consecutive terms, whether full or part:

Provided that a member who has ceased to hold the office of the chairperson or president continuously for one full term shall again be eligible for election to the office as such.

Explanation where any member holding the office of the chairperson or president at the commencement of this act is again elected to that office after such commencement, he shall for the purpose of this section, be deemed to have held office for one term before such election.

Comments: A member of a Board shall not eligible to be elected as the chairperson or president or vice-chairman or vice president of Multi- State Co-operative society if such member is a minister of the central government or State Government. No A member of a Board shall not eligible to be elected as the chairperson or president or vice-chairman or vice president of Multi-State Co- operative society after he has held the office as such during two consecutive terms.

Bye-Law 24. Disqualification for directorship as delegateship:

No person shall be eligible for being chosen as and for being a member of the board of delegate, if he

(viii) has held office as a director of the Board/delegate For two immediately preceding consecutive terms.

The case of petitioner is that Section 44 (2) of the

Act is referring disqualification of Chairperson or President or

Vice-chairman or Vice-president of Multi-State Co-operative

Society if he has held the office as such during two consecutive

terms and such section is not applicable to Directors/Delegates;

Bye-law 24 (viii) is referring to disqualification of

Director/Delegate if he held the office as such during two

consecutive terms and both are inconsistent to each other and

the bye-law is contrary to Section 44 (2) of the Act and the same

is liable to be set aside. Now, petitioner is submitting his

nomination to the post of Director of General Body of the 3rd

respondent society. It is stated that there is every chance to

reject his Application on the ground that he is not eligible as per

bye-law 24 (viii) which is inconsistent with Section 44 (2) of the

Act. If his case is rejected on that ground, he will be put

irreparable loss and hardship. Therefore, immediately, petitioner

approached the 3rd respondent Society and verified the bye-law;

the 3rd respondent Society orally informed that if he applies for

Director, his case may be rejected as per bye- law 24 (viii).

3. This Court while issuing notice before admission on

16.11.2023, directed the respondent authorities to accept the

Application of petitioner and allow him to participate in the

election as Board of Director, pursuant to the notification dated

11.11.2023 of the 3rd respondent.

4. By order dated 24.11.2023 in I.A.No. 2 of 2023,

Respondents 4 and 5 were impleaded. In I.A.No. 3 of 2023 filed

seeking to vacate the order dated 16.11.2023, this Court in the

interests of both the parties, modified the said order to the

extent that election process may go on, as no prejudice would be

caused to impleaded respondents and the respondent - society

shall not declare the results of elections to the extent of

Constituency No.7 until further orders.

5. In the counter-affidavit filed on behalf of

Respondents 4 and 5, it is stated that they are employees of

South Central Railway and members of the 3rd respondent

Society. It is stated that they are elected delegates from

Constituency Nos. 7 and 1 and are entitled to participate in the

forthcoming elections. It is stated that the 3rd respondent is a

registered body and has got its bye-laws as amended up to

28.01.2023, approved by the Central Registrar of Cooperative

Societies, vide certificate dated 25.01.2023. It is pointed out, the

amendments proposed / passed in the general body on

13.07.2022 during the term of office of petitioner as Vice-

President. At the relevant point of time and even as on this date,

petitioner is Vice- president of the Society.

It is stated that several candidates applied for being

elected to the Board of Directors for the ensuing elections to be

held on 25.11.2023. As per the list of nominations received and

displayed by the returning officer on 16.11.2023, for

constituency No.7, petitioner was listed as a candidate and he

proposed another candidate Sri M. Mahesh Kumar, S/o

Srinivasa Rao and also seconded the nomination in another set.

On this ground alone, he is liable to be disqualified, as

petitioner himself being a candidate for election, could not be a

proposer or seconder of nomination of another candidate. In

fact, the other candidate also stands disqualified and his

nomination ought to have been rejected. It is stated that

petitioner held office of Director for the last two consecutive

terms. Though an objection was raised in regard to nomination

of petitioner, the retuning officer appears to have not taken the

same into consideration. By notification dated on 17.11.2023,

returning officer displayed a list of valid nominations; for

constituency No.7, petitioner as well as M. Mahesh Kumar were

listed as nominations validly accepted.

It is stated that on 18.11.2023, the returning officer

displayed the list of valid nomination after withdrawal, even in

the said list, the name of petitioner was mentioned. By the date

Writ Petition was filed, elections process has already started in

accordance with existing bye-laws. Obviously, petitioner had not

disclosed the same to the court in getting impugned order

passed. It is stated that the issue raised by petitioner is within

the competence of Central Registrar under Act 69 of 2002.

Instead of approaching the said Court, he has hastily

approached this Court and sought for an interim order, which is

not tenable. It is stated that if the bye-laws as enacted are not

acceptable to petitioner, which were accepted by the General

Body during his tenure as Vice-president, he ought to have

questioned the general body in that regard. Having failed to do

so, his approaching this Court is untenable and mala fide.

It is stated that bye-law is valid and therefore, is

entitled to be enforced and observed by the Society and

Returning Officer is bound by the same. The alleged

inconsistency between Bye-law 24(viii) and Section 44(2) of Act

of 2002 is unfounded and misleading. It is stated that this

Court failed to look into Section 45(4) of the Act of 2022 and

should have read them harmoniously, and thus ought not to

have granted the relief.

It is finally stated that Writ Petition questioning the

process of election or alleged contradiction in bye-law is not

maintainable, as the society was registered under the Multi-

State Cooperative Societies Act and is a private body. It is bound

by the bye-laws governing its administration. It is pointed out

that since petitioner is Vice-president of the Society, the latter is

not taking steps to defend the issue or get the stay vacated,

despite appeals made by Respondents 4 and 5.

It is stated that interim order virtually amounts to

allowing Writ Petition. Challenging the order dated 16.11.2023,

Respondents 4 and 5 filed Writ Appeal No. 1100 of 2023,

wherein the Hon'ble Division Bench permitted them to file

implead petition and the petition to vacate the interim order

dated 16.11.2023.

6. Petitioner filed a reply stating that Society is a

registered body under the Multi-State Cooperative Societies Act,

2002 and has got its own bye-laws, but the amendment of bye-

law 24 (viii) dated 25.01.2023 was approved by the Central

Registrar of Co-operative Societies, without following due

process as stated in Section 11, sub-section 4 (ii) to (vii) and

Respondents 4 and 5 did not file any material documents to

prove that amendment has been carried out as per the above

said section. It is not true that no notice was given under

Section 11, sub-section (2), (4) (b) (i) to (vii) to the

delegates/directors regarding amendment of bye-law 24 (viii)

which is in violation of sub-section (2), 4 (b) (i) to (vii). In the

general body, there was no discussion about the amendments of

bye-laws and the amendment of bye-law 24 (viii) is sub-judice

before Central Register, New Delhi from 2014 onwards. Without

stating any of the proceedings or result of matter of sub-judice

before Central Register, New Delhi, amendments were taken

place and the same was not aware to petitioner though he was a

Vice-president. Hence the amendment of bye-law was approved

without following due process of law and the same is not

maintainable under law. It is true that the Board of Directors of

the society was notified on 11.11.2023 and the 4th respondent

and himself figure for constituency no.7 as delegate and the 5th

respondent figure in constituency No.1 as delegate. Though

Respondents 4 and 5 delegates from the said constituencies,

have not participated in the elections to the Board of Directors

and mere participation of petitioner in the election for the post

of Board of Directors, Respondents 4 and 5 have no prejudice

caused to them. Once they did not participate in the election

process, they are no way concerned with writ petition and nor

affected/aggrieved parties by the orders passed by this Court.

Hence, the objections raised by Respondents 4 and 5 are not

maintainable under law. It is further stated that petitioner is not

barred by any bye-law or Act, being a contesting member, to

propose any other candidate or seconder of the nomination of

another candidate. In Constituency no. 7, there are only 5

delegates and no other excess members are available to

nominate/propose or second for the post of directorship. Due to

lack of members only, petitioner and other candidate proposed

each other. It is pertinent to mention that the 4th respondent as

one of delegates of constituency No. 7, has not even proposed /

seconder to anyone and not contesting to the post of board of

directors and not even voted for any one for the contesting

directors. They simply filed implead application and vacate stay

petition to disturb the smooth functioning of election process

and to harass petitioner without having any prejudice caused to

him. It is further stated that vacate petitioners are not affected

by the order of this Court, hence, vacating the interim order

does not arise. In fact, till the amendment takes place,

respondent Society has allowed directors/delegates for third

term consequentially. Petitioner held office of director for the

last two consecutive terms and he is the only person who was

aggrieved by the amendment of bye-law No. 24 (viii), hence he

knocked the door of this Court. Petitioner clearly stated in his

writ affidavit regarding date of notification and its schedule.

Hence the question of obtaining interim order without disclosing

the fact that election process is already started does not arise. It

is stated that the issue raised by petitioner may be within the

competence of the Central Registrar, but he is being deprived of

his fundamental right to participate in the election process

because of the amendment of subject bye-law. The well-settled

law is that, once fundamental rights of anyone is violated,

aggrieved person can invoke/approach the writ jurisdiction

under Article 226 of the Constitution of India. It is further

stated that the Hon'ble Apex Court clearly stated in Whirlpool

Corporation v. Registrar of Trade Marks 1, when the

(1998) 8 SCC 1

alternative remedy is also available, the aggrieved can approach

the High Court by invoking Article 226. The amendment might

have taken place during his tenure as Vice-president but the

President is fully authorized to deal with those amendments and

at the time of board meeting, amendments have not came up for

discussion and no voting had taken place and no record was

shown by the Society to that effect. It is further stated that

Section 45 (4) of 2002 Act referring re-election and not for

regular election, hence reading the said bye-law with Section 45

(4) of the Act does not arise unless the amendment satisfied

with Section 11 (4) (b) (i) to (vii) and no such record produced

before this Court as well as the Central Registrar at the time of

amendment.

It is stated that the Society is a body registered

under the Multi-State Cooperative Societies Act, 2002 and it

was headed by a senior personnel officer of the railways till

2020 as Secretary of the Society and his term ended due to

deputation of earlier President into Society. Even deductions of

loans due to Society are being done by the Railways from the

employees' salary and credited to the Society. The Society

having its own bye-laws and President is the competent

authority and respondent Society being represented by its

Secretary will defend the matter as and when required. The

Notification was challenged in Writ Petition No. 27849 of 2023

and the Society represented by its Secretary, defended the

matter and made efforts for smooth functioning of the election

process. Being voters of the Society, Respondents 4 and 5 are

not aggrieved persons in any way of the interim order passed by

this Court, as they are not even contesting the election for the

post of Board of Directors and no prejudice was caused to them

if petitioner participated in the election process nor utilized his

vote while electing the board of director. In the absence

procedure contemplated under Section 11 (4) (b) (i) to (vii) of the

Act, the amending byelaw is not sustainable under law. The

reading of said bye-law 24 (viii) with Section 45 (4) of the Act

arises only after satisfying Section 11 (4)(b)(i) to (vii) of the said

Act. Hence the amendment to byelaw is illegal and bad in the

eye of law and the same is liable to be set aside.

7. Heard learned counsel for petitioner Sri B. Arjun,

learned Government Pleader for Cooperation, Sri Vedula

Venkata Ramana, learned Senior Counsel on behalf of Sri P. Sri

Harsha Reddy, learned counsel for the 3rd respondent and Sri

Srikanth Hariharan, learned counsel for Respondents 4 and 5.

8. Learned counsel for petitioner draws attention of

this Court to the judgment in Whirlpool Corporation's case,

wherein in paragraphs 14 and 15 it is held:

14. The power to issue prerogative writs under Article 226 of the Constitution is plenary in nature and is not limited by any other provision of the Constitution. This power can be exercised by the High Court not only for issuing writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari for the enforcement

of any of the Fundamental Rights contained in Part III of the Constitution but also for "any other purpose".

15. Under Article 226 of the Constitution, the High Court, having regard to the facts of the case, has a discretion to entertain or not to entertain a writ petition. But the High Court has imposed upon itself certain restrictions one of which is that if an effective and efficacious remedy is available, the High Court would not normally exercise its jurisdiction.

But the alternative remedy has been consistently held by this Court not to operate as a bar in at least three contingencies, namely, where the writ petition has been filed for the enforcement of any of the Fundamental Rights or where there has been a violation of the principle of natural justice or where the order or proceedings are wholly without jurisdiction or the vires of an Act is challenged. There is a plethora of case-law on this point but to cut down this circle of forensic whirlpool, we would rely on some old decisions of the evolutionary era of the constitutional law as they still hold the field.

Further, the judgment of the Hon'ble Supreme Court in

Akalakunnam Village Service Cooperative Bank Limited v.

Binuy N. 2

In this writ petition, question which arises as a

preliminary objection is:

" Whether a writ remedy can be availed in so far as the alleged illegalities in the conduct of elections to the South Central Railway Employees Co-operative Credit Society Limited which is incorporated under the provisions of the Multi-State Co-operative Societies Act, 2002."

9. Learned counsel for petitioner contended that

elections to Railway Employees Co-operative Credit Society,

which is a Multi-State Co-operative Society, is governed by the

provisions of the Act and the Rules framed thereunder. The

relevant Rules are extracted below:

(2014) 9 SCC 294

19. Procedure for conduct of elections.(1) The election of members of the board shall be conducted by a returning officer appointed by the board in its meeting The returning officer so appointed shall not be a member or an employee of the society.

(2) The election of the members of the board referred to in sub-rule (1) shall be conducted by secret ballot in the manner as specified in the Schedule attached with these rules.

20. Election of the Office bearers (1) The election of the office bearers of the board shall be conducted as per the programme given in the election schedule

(2) The eligibility of the candidates for the election of office bearers shall be subject to the provisions contained in sections 43 and 44 of the Act.

Sec. 45. Elections of members of the Board:-

(4) The elected members of the board shall, if the bye laws of such society permit, be elegible for re-election.

(5) The term of office of the elected members of the board shall be such, not exceeding five years from the date of elections, as may be specified in the bye-laws of a Multi State co- Operative Society.

It is vehemently contented that the Act has

undergone an amendment which is called the Multi State Co-

Operative Societies (Amendment) Act, 2023 (Act No. 11 of 2023)

issued by the Government of India dated 03.08.2023, but a

perusal of the said notification would show that the amended

provisions would come into force from the date the gazette

notification has been issued stipulating the date of coming into

force of the amended provisions. Petitioners are unable to place

any gazette notification to show that particular provisions in the

amended Act/Rules have been gazetted, therefore, it has to be

concluded that the amended provisions for non-publication in

the official gazette, have not yet come into force and those

provisions would come into force only as and when relevant

gazette notifications are issued as per Section 1 (2) of the

amended Act. For clarity, Section 1(2) is extracted below:

" Section 1 (2): It shall come into force on such date

as the central government may, by notification in the official

gazette, appoint; and different dates may be appointed for

different provisions of this Act and any reference in any such

provision to the commencement of this Act shall be construed

as a reference to the coming into force of that provision."

10. It is settled law that a Writ Court would not

entertain election disputes, since the remedy is in the form of

Election Petition under Section 84 (2) of the Multi-State Co-

operative Societies Act.

11. However, it has been argued that certain

reservations are provided by the amended provisions of the

statute and without abiding by the reservations in favour of

Scheduled Castes, Scheduled Tribes, women, present election

notification was issued, hence the entire election of the

delegates onwards is vitiated. This Court in Sruthi Venkatesh

Vs. Election Committee, Sri Somavamsha Shasatrarjuna

Kshatriya Mutually Aided Co-Operative Thrift Society Ltd.

Rep By Its Committee Members And Others 3 held as under:

" 13. It is settled principle of law that once election process is set in motion Courts of law should not interject the process. All issues relating to elections, including drawing up voters list is part of election process. A person aggrieved by any aspect relating to elections has to wait till the entire process is completed and results are announced and can agitate only in the form of election dispute. It is the consistent view of this Court that once election process is set in motion, the High Court should not interfere and stall the

(2021) 3 ALD 105

elections. In election matters, no remedy is provided at intermediate stage and only remedy is Election Petition after the election is over. [Kalla Ramakrishna v. State Election Commission : (2005) 1 AP LJ 11 (HC)(FB); Prattipati Bhagyamma v. Election officer : (2005) 6 ALD 350; Dhulipaka Narendra Kumar v. A.P. Coop Tribunal : (2011) 1 ALD 292].

12. The question relating to maintainability of writ

remedy against a Co-operative Society is no longer res integra. A

Full Bench of this composite High Court of Andhra Pradesh in

AIR 1990 AP 171, clearly ruled that a writ is not maintainable

against the co-operative Society incorporated under the

provisions of the A.P. Co-operative Societies Act, 1964. The ratio

laid down in the said judgment applies to the Co-operative

Societies which are incorporated under the Multi-State Co-

operative Societies Act also. In view of the settled position and

also on the ground that there is an effective alternate remedy

available under the Multi-State Co-operative Societies Act, in

Section 84, it is to be held that this Writ Petition is not

maintainable, since the 3rd respondent Society is not a State

within the meaning of Article 12 of the Constitution of India.

The remedy under Article 226 of the Constitution can be

invoked against any authority which is discharging statutory

functions. In Andi Mukta Sadguru Shree Muktajee Vandar

Swami Suvarna Jayanti Mahostav Smarak Trust vs. V. R.

Rudrani 4 , it has been held as:

" 14. But here the facts are quite different and, therefore, we need not go thus far. There is no plea for specific performance of contractual service. The respondents are not seeking a declaration that they be continued in service. They are not asking for mandamus to put

AIR 1989 SC 1607

them back into the college. They are claiming only the terminal benefits and arrears of salary payable to them. The question is whether the trust can be compelled to pay by a writ of mandamus?

15. If the rights are purely of a private character no mandamus can issue. If the management of the college is purely a private body with no public duty mandamus will not lie. These are two exceptions to mandamus. But once these are absent and when the party has no other equally convenient remedy, mandamus cannot be denied. It has to be appreciated that the appellants trust was managing the affiliated college to which public money is paid as government aid. Public money paid as government aid plays a major role in the control, maintenance and working of educational institutions. The aided institutions like government institutions discharge public function by way of imparting education to students. They are subject to the rules and regulations of the affiliating University. Their activities are closely supervised by the University authorities. Employment in such institutions, therefore, is not devoid of any public character. [ See The Evolving Indian Administrative Law by M.P. Jain (1983), p. 226] So are the service conditions of the academic staff. When the University takes a decision regarding their pay scales, it will be binding on the management. The service conditions of the academic staff are, therefore, not purely of a private character. It has super-added protection by University decisions creating a legal right-duty relationship between the staff and the management. When there is existence of this relationship, mandamus cannot be refused to the aggrieved party."

In the present case, the Society is only a credit Society

providing credit facilities to the members of the South Central

Railways Employees. It does not discharge any public and/or

statutory functions, hence either from the point of view of

Article 12 or from the extended meaning given to the authorities

under Article 226, this Court is of the view that the Writ Petition

is misconceived.

13. The view of this Court is further fortified by the

judgment in Sruthi Venkatesh Vs. Election Committee, Sri

Somavamsha Shasatrarjuna Kshatriya Mutually Aided Co-

Operative Thrift Society Ltd. Rep By Its Committee

Members (supra). Once Election notification was issued, Courts