Jyotindra Patel vs Nair Pushpa Sureshkumar and Ors.

¶1

wp14087-2023 & wp14098-2023 Final.doc

¶2

MPB

¶3

IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION

¶4

WRIT PETITION NO.14087 OF 2023 WITH

¶5

INTERIM APPLICATION NO. 13356 OF 2024

¶6

1 Smt. Nair Pushpa Sureshkumar, Age : 53 years, Occ. : Housewife, R/at : E-/101, Brahama Sunicity CHS Ltd., Wadgaon Sheri, Pune 411014.

¶7

2 Smt. Ganga Pant, Age : 50 years, Occ. : Housewife, R/at :C-4/904, Brahama Sunicity CHS Ltd., Wadgaon Sheri, Pune 411014.

¶8

3 Shri Nishthala Venkatramana Murthy, Age : 51 years, Occ.: Service, R/at : C- 12/303, Brahama Sunicity CHS Ltd., Wadgaon Sheri, Pune 411014.

¶9

4 Shri Rajesh Bhausaheb Dhage, Age : about years, Occ.: Servie, R/at : C/1602, Brahama Sunicity CHS Ltd., Wadgaon Sheri, Pune 411014.

¶10

5 Smt. Sneha Gajanan Nimbalkar, Age : about years, Occ.: Housewife, R/at : L-3/702, Brahama Sunicity CHS Ltd., Wadgaon Sheri, Pune 411014.

¶11

6 Shri Ranjeet Yashwant Pingale, Age 55 years, Occ.: Service, R/at : C- 11/203, Brahama Sunicity CHS Ltd., Wadgaon Sheri, Pune 411014.

¶12

7 Shri Subin Arvind Paniker, Age : about years, Occ. Business, R/at : E-1/201, Brahama Sunicity CHS Ltd., Wadgaon Sheri, Pune 411014.

¶13

1

¶14

wp14087-2023 & wp14098-2023 Final.doc

¶15

8 Smt. Pallavi Kiran Jagdhane, Age : about years, Occ.: Business, R/at : E-4/201, Brahama Sunicity CHS Ltd., Wadgaon Sheri, Pune 411014. 9 Shri Siddharth P Borgohay, Age : about years, Occ.: Service, R/at : L-3/906, Brahama Sunicity CHS Ltd., Wadgaon Sheri, Pune 411014. 10 Shri Dinesh Lokhande, Age : 58 years, Occ.: Retired, R/at : L- 1/305, Brahama Sunicity CHS Ltd., Wadgaon Sheri, Pune 411014. 11 Shri Arun Singh, Age : Adult years, Occ. : Business, R/at: C4/301, Brahama Sunicity CHS Ltd., Wadgaon Sheri, Pune 411014. … Petitioners V/s. 1 The State of Maharashtra, Through its principal Secretary Ministry of Co-operation having office at Mantralaya, Mumbai. 2 The Divisional Joint Registrar of Co-operative Societies Pune Division, Pune. Office at: Ground Floor, Sakhar Sankul, Shivajinagar, Pune- 05. 3 The Deputy Registrar of Co-operative Societies, Pune City No. 05, Pune Office at: Survey No. 46, Bombay Sappers Colony, Krishna Plaza, Nagar Road, Wadgaon Sheri, Pune. 4 Shri Rajiv Gupta, Age : Adult Years, Occ. Business, R/at : A3/1002, Brahama Sunicity CHS Ltd.,

¶16

2

¶17

wp14087-2023 & wp14098-2023 Final.doc

¶18

Wadgaon Sheri, Pune 411014.

¶19

5 Shri Mahesh Muraraka,

¶20

Age : Adult Years, Occ.: Business, R/at: C5/1001, Brahma Suncity CHS Ltd., Wadgaon Sheri, Pune 411014.

¶21

6 Shri Vinod Panjabi ,

¶22

Age : Adult years, Occ.: Retired, R/at : Brahama Suncity CHS Ltd., Wadgaon Sheri, Pune 411014.

¶23

7 Shri Jyotindra Patel Age : Adult years, Occ. : Business, R/at : L1/602, Brahma Suncity CHS Ltd., Wadgaon Sheri, Pune 411014.

¶24

8 Brahma Suncity Co-operative Housing Society Ltd. , A Co-operative Society registered under MCS Act, 1960 having its registered office at : S. No. 7/1, Wadgaon Sheri, Pune 411014, Thr. its Authorized Officer.

¶25

... Respondents

¶26

WITH

¶27

WRIT PETITION NO. 14098 OF 2023

¶28

1 Mr. Yogesh Sidhojirao Desai Age : about 47 years, Occ. : Service, R/at: C-2/402, Brahama Sunicity CHS Ltd. Wadgaon Sheri, Pune 411014

¶29

2 Mr. Nagendra Kumar Ramuria Age : about 42 years, Occ. Service, R/at : E-2/401, Brahama Sunicity CHS Ltd. Wadgaon Sheri, Pune 411014

¶30

3 Mr. Akshay Jain, Age : about 38 years, Occ.: Business, R/at : C/504, Brahama Sunicity CHS

¶31

3

¶32

wp14087-2023 & wp14098-2023 Final.doc

¶33

Ltd. Wadgaon Sheri, Pune 411014 4 Mr. Vijay Dnyanoba Kale, Age : adult 42 years, Occ.: Business, R/at : E-5/904, Brahama Sunicity CHS Ltd. Wadgaon Sheri, Pune 411014. … Petitioners V/s.

¶34

1 The State of Maharashtra, Through its principal Secretary Ministry of Co-operation having office at Mantralaya, Mumbai.

¶35

2 The Divisional Joint Registrar Of Co-operative Societies Pune Division, Pune. Office at: Ground Floor, Sakhar Sankul, Shivajinagar, Pune- 05. 3 The Deputy Registrar of Co-operative Societies, Pune City No. 05, Pune Office at: Survey No. 46, Bombay Sappers Colony, Krishna Plaza, Nagar Road, Wadgaon Sheri, Pune. 4 Shri Rajiv Gupta, Age : Adult Years, Occ. Business, R/at : A3/1002, Brahama Sunicity CHS Ltd., Wadgaon Sheri, Pune 411014. 5 Shri Mahesh Muraraka, Age : Adult Years, Occ.: Business, R/at: C5/1001, Brahma Suncity CHS Ltd., Wadgaon Sheri, Pune 411014. 6 Shri Vinod Panjabi , Age : Adult years, Occ.: Retired, R/at : Brahama Suncity CHS Ltd., Wadgaon Sheri, Pune 411014.

¶36

7 Shri Jyotindra Patel Age : Adult years, Occ. : Business, R/at :

¶37

4

¶38

wp14087-2023 & wp14098-2023 Final.doc

¶39

L1/602, Brahama Suncity CHS Ltd., Wadgaon Sheri, Pune 411014.

¶40

8 Brahma Suncity Co-operative Housing Society Ltd. , A Co-operative Society registered under MCS Act, 1960 having its registered office at : S. No. 7/1, Wadgaon Sheri, Pune 411014, Thr. its Authorized Officer. ... Respondents

¶41

Mr. Kishor Patil i/by Mr. Sidheshwar Biradar for the petitioners in both the writ petitions.

¶42

Mrs. V. S. Nimbalkar, AGP for the State – Respondent No.1 in both the writ petitions.

¶43

Ms. Shraddha Pawar i/by Mr. Dilip Bodake for the Respondent Nos. 2 & 3 in both the writ petitions.

¶44

Mr. Anil Sakhare, Senior Advocate i/by Mr. Siddharth Ronghe for the Respondent Nos. 4 & 7 in both writ petitions.

¶45

Mr. Pratik B. Rahade for Respondent No. 8 in both the writ petitions.

¶46

CORAM : AMIT BORKAR, J. RESERVED ON : DECEMBER 8, 2025 PRONOUNCED ON : DECEMBER 12, 2025

¶47

JUDGMENT:

¶48

The first petition, Writ Petition No. 14087 of 2023, challenges an order passed under Section 77A of the Maharashtra Co-operative Societies Act, 1960. By that order, the Managing Committee consisting of the petitioners stood superseded. The companion petition, Writ Petition No. 14098 of 2023, challenges the order passed under Section 154B-23. That order has disqualified the petitioners from holding the post of Managing Committee members for five years.

¶49

5

¶50

wp14087-2023 & wp14098-2023 Final.doc

¶51

The facts giving rise to these petitions are stated here. On 20 November 2022, the petitioners were elected as members of the Managing Committee of respondent No. 8 Society. On 18 January 2023, respondent No. 4 emailed the Society seeking copies of minutes of Managing Committee meetings held since October 2022. On 23 February 2023, the District Deputy Registrar, Pune directed the Society to provide the documents sought by respondent No. 4 upon payment of prescribed fees within forty-five days of such payment. On 10 March 2023 and 30 March 2023, respondent No. 4 again sent emails seeking the minutes and seeking information about the fees payable under by-law 170. On 11 April 2023, respondent No. 4 lodged a grievance before the District Deputy Registrar regarding non-supply of documents. On 12 April 2023, the District Deputy Registrar passed an order under Section 154B-27(1) directing the Society to supply documents within seven days and submit a compliance report. On 10 May 2023, the Society emailed respondent No. 4 asking him to pay Rs. 260 for copies of minutes. On the same day, respondent No. 4 deposited copy charges of Rs. 307. On 12 May 2023, the Society supplied minutes of Managing Committee meetings up to February 2023.

¶52

On 26 April 2023, respondents 4 to 6 filed a common complaint alleging breach of the Society’s by-laws. On 28 April 2023, respondent No. 3 issued a show cause notice to the Society proposing action under Section 154B-23(3). Copies of the notice were served on all Managing Committee members. The petitioners filed a reply on 15 May 2023 contesting the allegations. On 26

¶53

6

¶54

wp14087-2023 & wp14098-2023 Final.doc

¶55

May 2023, respondent No. 3 passed an order under Section 154B23(3) disqualifying the petitioners and debarring them from contesting Society elections for five years. On 29 May 2023, respondent No. 3 passed a further order under Section 77A(1) appointing an administrator over the Society.

¶56

On 12 June 2023, the petitioners filed Revision Application No. 236 of 2023 challenging the order passed under Section 77A. On 27 October 2023, respondent No. 2 dismissed the revision application as well as the appeal filed by the petitioners. The present writ petitions came to be filed on 3 November 2023. On 30 November 2023, this Court issued Rule and granted interim relief. The Supreme Court confirmed the interim relief on 10 April 2024.

¶57

Learned counsel Mr. Kishore Patil submitted that the right to seek copies of documents under Section 154B-8 arises only after payment of dues. He submitted that the Society must supply copies within forty-five days from the date of payment of requisite fees. He pointed out that respondent No. 4 paid charges on 10 May 2023 and the Society supplied minutes on 12 May 2023. He submitted that disqualification of the entire Managing Committee cannot be justified on the allegation of non-supply of documents. According to him, non-supply of documents is governed by Section 154B-27, which provides for a monetary penalty of Rs. 5,000. Therefore, according to him, the Managing Committee could not have been superseded and the order of disqualification and the consequential order under Section 77A deserve to be set aside.

¶58

7

¶59

wp14087-2023 & wp14098-2023 Final.doc

¶60

Learned senior counsel Mr. Sakhare for respondents 4 and 7 opposed the petitions. He submitted that respondent No. 4 had sought copies of minutes since 18 January 2023 and repeated his requests on 29 January 2023, 15 February 2023, 23 February 2023 and 25 February 2023. Emails show that respondent No. 4 was ready to pay charges. On 23 February 2023, the District Deputy Registrar directed the Society to supply the minutes. Despite this, respondent No. 4 had to again write on 10 March 2023 seeking compliance of the direction. On 21 March 2023, 27 March 2023 and 30 March 2023, respondent No. 4 again informed the Society that he was ready and willing to pay charges. On 12 April 2023, the District Deputy Registrar directed the Society to supply minutes from October 2022 within seven days, i.e. on or before 19 April 2023.

¶61

He submitted that the Society acted only after receipt of notice under Section 154B-23. It sent its first communication regarding charges only on 10 May 2023. On 11 May 2023, the Society informed respondent No. 4 that copies were ready. On 12 May 2023, respondent No. 4 informed the Society that copies supplied were only till 27 February 2023. He submitted that the petitioners have already been held responsible for causing loss to the Society under Section 88 and a recovery certificate has been issued. According to him, refusal to supply minutes from October 2022 was deliberate since those minutes contained material revealing irregularities committed by the petitioners. He submitted that respondent No. 4 received no communication from the Society about copy charges from 18 January 2023 till 10 May 2023.

¶62

8

¶63

wp14087-2023 & wp14098-2023 Final.doc

¶64

According to him, the plea regarding delay in payment of charges cannot be accepted.

¶65

He relied on the judgment of this Court in Shahid Tamboli and Others v. Divisional Joint Registrar Co-operative Societies and Others, 2023 SCC OnLine Bom 1479. He submitted that this Court has held that Section 154B-23 is mandatory and empowers the Registrar to disqualify a Managing Committee for failure to supply documents. He submitted that neither Section 154B-8 nor Section 154B-23 uses the expression “without reasonable cause”. According to him, even in a mandatory provision, if a party substantially complies with the requirement, the Court may relieve hardship. However, he submitted that in the present case there is no substantial compliance because respondent No. 4 was ready and willing to pay charges from 18 January 2023 till 10 May 2023. He submitted that the petitions deserve dismissal.

¶66

I have considered the record. I have heard learned counsel for the parties. I have perused the orders impugned, and the material placed on record. I proceed to state findings and reasons.

¶67

The petitioners were elected to the Managing Committee on 20 November 2022. On 18 January 2023 respondent No. 4 sought copies of minutes from October 2022. The request was repeated by e-mails through February and March 2023. The District Deputy Registrar intervened on 23 February 2023 and again on 12 April 2023. The latter order under Section 154B-27(1) required supply within seven days and a compliance report. The Society supplied minutes only on 12 May 2023. Respondent No.4 had repeatedly

¶68

9

¶69

wp14087-2023 & wp14098-2023 Final.doc

¶70

stated willingness to pay the prescribed charges. Respondent No.3 issued a show cause notice under Section 154B-23. The petitioners replied. On 26 May 2023 respondent No.3 disqualified the petitioners under Section 154B-23(3). On 29 May 2023 respondent No.3 appointed an administrator under Section 77A(1). A recovery certificate under Section 88 is also on record against the petitioners.

¶71

The legal questions are four. First, whether the Registrar had jurisdiction to disqualify the Managing Committee under Section 154B-23 for non-supply of documents. Second, whether the facts show reasonable cause or substantial compliance so as to exclude disqualification. Third, whether appointment of an administrator under Section 77A(1) was justified as a consequential and independent action. Fourth, whether an alternate remedy of penalty under Section 154B-27 precluded disqualification and supersession.

¶72

For proper adjudication of the issues arising in these petitions, it is necessary to set out the text of Section 154B-8 and Section 154B-23 of the Maharashtra Co-operative Societies Act, 1960. These provisions define the statutory rights of members to access records of the Society and the corresponding duties of the Managing Committee. They also determine when and how members of a Managing Committee incur disqualification for breach of those duties. The sections read as follows.

¶73

Section 154-B-8. Rights of Members to inspect the documents.—(1) Every Member of a society shall be entitled to

¶74

10

¶75

wp14087-2023 & wp14098-2023 Final.doc

¶76

inspect, free of cost, at the society's office during office hours, or any time fixed for the purpose by the society, a copy of the Act, the rule and the bye-laws, the last audited annual balance sheet, the profit and loss account, a list of the members of the Committee, a register of members, the minutes of general meetings, minutes of Committee meetings and those portions of the books and records in which his transactions with the society have been recorded.

¶77

(2) A society shall furnish to a Member, on request in writing and on payment of such fees at such rate as may be decided by the Registrar, from time to time, the copies of any documents mentioned in the foregoing sub-section within forty-five days from the date of payment of such fees and when the Society is assisted by the Government in the form of share capital, loan and land, the said Society shall furnish such information within thirty days from the date so requested by a member.

¶78

Section 154-B-23. 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 a Member of the Committee, no person shall be eligible to be appointed, nominated, elected, co-opted for being a Member of Committee,—

¶79

(i) if he is a defaulter of any society, or

¶80

(ii) if he carries on business of letting, subletting and selling of flats in the housing society of which he is a Member, or

¶81

11

¶82

wp14087-2023 & wp14098-2023 Final.doc

¶83

(iii) if he has been held responsible under Section 79, 88, 154-B-8(2) or 154-B-27 or for payment of cost of enquiry under Section 85, or

¶84

(iv) if he has incurred any disqualification under this Act or the rules made thereunder, or

¶85

(v) if he incurs any of the disqualification similar to that mentioned in the provisions of clause (vii), (viii) or (ix) of clause (f) of sub-section (1) of Section 73-CA.

¶86

(2) A Member, who has incurred any disqualification under sub-section (1), shall cease to be a Member of Committee and his seat shall thereupon be deemed to be vacant.

¶87

(3) A Member of a Committee who has ceased to be a Member thereof, on account of having incurred disqualification under clause (ii), (iii), (iv) or (v) of subsection (1), shall not be eligible to be re-elected, re-co-opted or re-nominated as a Member of Committee for five years from the date on which he or she has so ceased to be a Member of the Committee.

¶88

(4) A Member of a Committee who has ceased to be a Member thereof, on account of having incurred disqualification other than disqualifications, referred to in sub-section (3), shall, unless otherwise specifically provided in this Act, be eligible to be re-elected, re-co-opted or renominated as a Member of Committee as soon as such disqualification ceases to exist.

¶89

12

¶90

wp14087-2023 & wp14098-2023 Final.doc

¶91

I now examine Sections 154B-8 and 154B-23 in the context of the facts already recorded. The two provisions operate in different fields but are closely connected. Their combined effect must be understood to determine whether the Registrar lawfully exercised jurisdiction and whether the petitioners rightly incurred disqualification.

¶92

Section 154B-8 creates two distinct rights and obligations. Sub-section (1) grants every member a right to inspect specified documents free of cost. That right is immediate. It does not depend on any fee. Sub-section (2) directs that on a written request and on payment of prescribed fees the Society must furnish copies of the documents mentioned in sub-section (1). The period for supply is forty-five days from the date of payment. Where the Society is assisted by the Government, the period is thirty days.

¶93

Three important features emerge. First, the statute makes a clear distinction between inspection and obtaining copies. Inspection is free and unconditional. Supply of copies follows only upon payment. Second, the obligation to supply copies arises immediately upon receipt of the requisite fees. Third, the section sets a definite time limit for furnishing copies once fee is paid. This time limit cannot be extended by the Society unilaterally.

¶94

Section 154B-8 gives a clear right to every member to see the records of the Society and to receive copies of those records within the time fixed by law. This right carries with it a duty on the Society and its Managing Committee to respond without delay. The law expects the Society to function in the open. Members must

¶95

13

¶96

wp14087-2023 & wp14098-2023 Final.doc

¶97

know how decisions are taken and what business is conducted in their name. If information is kept back, members cannot protect their interests. The Legislature has therefore placed a strict duty on the Society to give documents when asked. This provision aims to prevent any hidden or secret working of the committee. The Managing Committee holds office for the benefit of all members. It cannot keep records away from them. When a member asks for copies of minutes or other documents, the Society must supply them promptly. Silence, delay or inaction cannot be treated as a valid answer. If the Society does not act, the right given by the law becomes meaningless. A committee that avoids giving records raises doubt about its functioning. The law does not permit such conduct. The duty to supply documents is therefore not optional. It is a binding obligation that must be honoured in both letter and spirit.

¶98

I now turn to Section 154B-23. This provision deals with disqualification of committee members. Sub-section (1) identifies circumstances under which a person becomes ineligible to be appointed, nominated, elected or co-opted as a member of the committee. Of relevance here is clause (iii), which covers persons held responsible under Section 154B-8(2) or Section 154B-27. Thus, where a committee member is found responsible for breach of obligations under Section 154B-8(2), disqualification follows.

¶99

Sub-section (2) states the legal consequence. Once a member incurs any disqualification under sub-section (1), he ceases to be a committee member. The seat automatically falls vacant. This operates by force of law and not by a separate order. Sub-section

¶100

14

¶101

wp14087-2023 & wp14098-2023 Final.doc

¶102

(3) prescribes the further consequence that where the disqualification arises under clause (iii), the concerned member becomes ineligible for re-election, re-co-option or re-nomination for five years.

¶103

Section 154B-23 has been enacted to make sure that those who run the Society do so in a responsible and honest manner. Members of a Managing Committee hold a position of trust. They deal with the money, property and day-to-day affairs of the Society. When a committee member refuses to give documents, hides information or blocks a member’s lawful right under Section 154B8, such conduct shows that he cannot be trusted to continue in that position. The law therefore treats such a person as unfit to remain on the Committee. This provision is meant to protect the cooperative movement. A Society can function smoothly only when its committee works openly and truthfully. The Legislature has therefore empowered the Registrar to step in at the earliest sign of such misconduct. The Registrar is given authority to disqualify such committee members so that misuse of power does not continue, and the Society does not suffer further harm. A person who does not respect the rights of the members cannot be allowed to hold a position where those rights must be safeguarded. The law steps in to remove such persons so that cooperative institutions remain clean and well-governed.

¶104

The petitioners say that respondent No. 4 paid the copy charges only on 10 May 2023 and the Society supplied the minutes on 12 May 2023. They argue that their duty to give copies started only after payment and that they acted promptly once the charges

¶105

15

¶106

wp14087-2023 & wp14098-2023 Final.doc

¶107

were paid. On that basis they say that disqualification and supersession are too harsh. This argument needs careful examination of the dates and the earlier correspondence.

¶108

Respondent No. 4 first asked for the documents on 18 January 2023. He sent repeated reminders and made it clear that he was ready to pay whatever fees were required. The Society did not inform him of the fee amount until 10 May 2023. In the meantime, the District Deputy Registrar had already stepped in on 12 April 2023 and given a clear direction that the documents must be supplied within seven days. That meant the Society had to comply on or before 19 April 2023. The Society did not do so. The minutes were supplied only on 12 May 2023 and even then only partly. The dates speak for themselves. There was a long and unexplained delay from January to May. The Society did not follow the Registrar’s direction. The petitioners have shown no letter, receipt or e-mail to show that they told respondent No.4 about the fees earlier or made any attempt to help him comply. Their stand that “payment is a condition” cannot save them. Once a lawful direction was issued and the member was repeatedly asking for documents, the Society was bound to act. One cannot take advantage of one’s own failure to communicate.

¶109

The petitioners then argue that Section 154B-27 provides only a monetary penalty of Rs. 5,000 for non-supply of documents and that therefore the Registrar could not disqualify or supersede the committee. This argument mixes up two separate provisions serving different purposes. Section 154B-27 deals with calling for documents and punishing certain breaches with a fine. Section

¶110

16

¶111

wp14087-2023 & wp14098-2023 Final.doc

¶112

154B-23 deals with disqualification of committee members who fail to perform their statutory duties and obstruct transparency. The Act clearly intends both remedies to operate in their own fields. The presence of a penalty does not cancel the separate power of disqualification. If that were accepted, the entire purpose of Section 154B-23 would be lost. The Legislature has not stated that Section 154B-27 is the only remedy. The petitioners have shown no reason, either in the wording of the law or in its purpose, to restrict the Registrar’s power in the manner they suggest.

¶113

The petitioners say that even though the law is strict, the Court should take a practical view and excuse small mistakes if they have substantially complied. Courts do apply this principle in proper cases. If a party has made genuine efforts to follow the law and only a minor lapse has occurred, the Court may not insist on perfect compliance. The Court should not allow strict wording to cause unfair results when the party has acted honestly and promptly. But this principle applies only when the facts show real and timely steps by the party. It cannot be used by someone who stays silent for months and acts only when the authority starts taking action. Substantial compliance requires sincere and early effort. It is not available to a party who wakes up only after pressure from the authorities. Here the direction of the District Deputy Registrar required the Society to supply documents within seven days. If the petitioners disagreed with that direction or felt it was improper, they were required to challenge it immediately and seek a stay. They did neither. Once the direction remained in force,

¶114

17

¶115

wp14087-2023 & wp14098-2023 Final.doc

¶116

they were bound to follow it without delay. They cannot now say that they complied "substantially" when the supply was made only after the deadline expired and only after show cause proceedings began. The record contains no evidence showing any legitimate difficulty or obstacle faced by the petitioners between January and May. There is no material to show any genuine attempt to comply within time. The facts show a prolonged delay and inaction. In such circumstances, the claim of substantial compliance cannot be accepted. The law does not permit a party to ignore a binding direction and later seek shelter under this principle.

¶117

The respondents have pointed out in their affidavit that the petitioners have already been held responsible for causing loss to the Society under Section 88 and that a recovery certificate has been issued. This is an independent finding made earlier. It shows that the Society had already suffered financial loss due to acts of the petitioners. This fact cannot be ignored. It indicates that there were irregularities and problems in the way the Society was being managed. The petitioners have not placed any material before this Court to challenge or weaken that earlier finding. That earlier determination forms part of the background in which the Registrar had to consider the conduct of the petitioners. When a committee is already found responsible for financial loss, delay or refusal to give minutes becomes more serious. The Registrar is entitled to consider whether the minutes were being withheld to avoid detection of further irregularities. Respondent No. 4 was asking specifically for minutes from October 2022. Those minutes relate to the period in which the alleged irregularities and financial loss

¶118

18

¶119

wp14087-2023 & wp14098-2023 Final.doc

¶120

had taken place. If those minutes had been supplied in time, the facts could have come to light earlier. The record suggests that the non-supply was not accidental. It had the effect of blocking scrutiny. The petitioners have not given any convincing reason for keeping back these records for months. In these circumstances, the Registrar was justified in treating the delay in supplying minutes as part of a larger pattern of mismanagement.

¶121

For deciding how long a person should be disqualified under Section 154B-23, the Registrar must follow clear and fair standards. The law gives the power, but the use of that power must be guided by common sense and the need to protect the Society. The following points are important.

¶122

(i) Nature of the breach

¶123

The Registrar must see what exactly the committee member has done wrong. If the wrong involves hiding documents, blocking transparency or ignoring lawful directions, it becomes more serious. When a member’s conduct directly affects another member’s right to get documents under Section 154B-8, stricter action becomes necessary.

¶124

(ii) Length of the misconduct

¶125

The Registrar must see how long the misconduct continued. A small mistake corrected quickly is one thing. A delay of several months or refusal even after reminders is quite different and more serious.

¶126

(iii) Repeated requests and warnings

¶127

If a member keeps asking for documents in writing and the

¶128

19

¶129

wp14087-2023 & wp14098-2023 Final.doc

¶130

Society does nothing, it shows that the committee knowingly ignored its duty. If the Society still fails to act even after the Registrar passes orders, it strengthens the case for a longer disqualification.

¶131

(iv) Purpose or effect of the non-compliance

¶132

The Registrar must see whether the refusal to give documents might have been to hide wrongdoing, financial loss or misuse of power. If the misconduct affects the honest functioning of the Society, stronger action is justified.

¶133

(v) Past behaviour of the committee member

¶134

If the member has earlier been found responsible for wrongdoing under Sections 79, 88, 154B-8(2) or 154B-27, or if a recovery certificate has already been issued, it shows a pattern of poor management. Repeat violations call for stricter punishment.

¶135

(vi) Harm caused to the Society

¶136

The Registrar must consider whether the misconduct caused financial loss, confusion in the Society’s working or loss of trust among members. Greater harm demands a disqualification that fits the seriousness of the situation.

¶137

(vii) Response of the committee member

¶138

The Registrar should see whether the member offered a timely explanation or took steps to correct the mistake. A member who ignores the law for months and later gives technical excuses cannot ask for leniency

¶139

(ix) Cooperation during proceedings

¶140

20

¶141

wp14087-2023 & wp14098-2023 Final.doc

¶142

If the member did not produce documents during inquiry or did not assist the process, it shows that he is not fit to continue on the Committee. Lack of cooperation may justify the maximum disqualification.

¶143

(x) Need to protect the Society

¶144

The main goal is to protect the Society and its members from further harm. If the Registrar finds that allowing such a member to continue would put the Society at risk, a full fiveyear disqualification may be required.

¶145

(xi) Proportionality

¶146

Although the law provides for a five-year disqualification, the Registrar must decide a period that matches the actual misconduct. Small and unintentional mistakes may call for a shorter period. Serious and deliberate wrongdoing may justify the full term.

¶147

The next issue is whether disqualifying the petitioners for five years is too harsh. A disqualification for a fixed period is serious. It removes a person from the Managing Committee and stops him from contesting elections for that entire period. The Registrar must therefore act carefully and in a balanced manner. The punishment must fit the conduct. When the facts of this case are seen together, the decision to disqualify for five years appears reasonable. The petitioners did not comply with repeated requests from a member. They did not obey a clear and time-bound order issued by the District Deputy Registrar. They supplied the documents only after legal proceedings started. This shows a

¶148

21

¶149

wp14087-2023 & wp14098-2023 Final.doc

¶150

pattern of disregard for statutory duties. There is also the fact that a recovery certificate under Section 88 is already issued against the petitioners for causing financial loss to the Society. This shows that the Society had already suffered under their management. When financial irregularities are present, withholding minutes becomes more serious because such records help to uncover what went wrong. The Registrar must protect the Society and its members. When a committee repeatedly fails to follow the law and is already found responsible for financial loss, a strict measure becomes necessary to prevent further harm. The law itself fixes the period of five years for such disqualification. The Registrar has only applied what the statute provides. In these circumstances, the order of disqualification does not appear excessive or unreasonable. It is supported by the facts and falls squarely within the legal power conferred by Section 154B-23.

¶151

To decide whether non-compliance with Section 154B-8 should result in disqualification of the whole Managing Committee or only those members who were directly responsible under the bye-laws, the issue must be understood in a practical manner. Section 154B-8 creates a legal duty on the Society to give documents to its members. The Society works through its Managing Committee. Therefore, the duty under Section 154B-8 is, in law, the duty of the entire Committee. Supplying minutes, keeping records and answering members’ written requests are not small administrative tasks. They are essential duties of those who run the Society. The law expects the Committee as a whole to ensure that these duties are fulfilled. Under the Co-operative

¶152

22

¶153

wp14087-2023 & wp14098-2023 Final.doc

¶154

Societies Act and the model bye-laws, the Managing Committee functions on the principle of collective responsibility. The Committee takes decisions together and carries out statutory duties as one body. Unless the bye-laws very clearly say that only one officer, such as the Secretary, alone is responsible for supplying documents and that other members are exempt from this duty, the entire Committee remains responsible for compliance.

¶155

In some situations, disqualification of the entire Committee becomes necessary. This happens when the non-compliance is not caused by one person alone but by the collective inaction of the whole Committee. If no member of the Committee takes steps to comply, if repeated reminders are ignored, if the Committee shows a pattern of delay or withholding information, or if the documents relate to the Committee’s own meetings and decisions, the Registrar is justified in treating the whole Committee as responsible. In such cases, disqualifying the entire Committee is lawful and appropriate.

¶156

However, there may be rare cases where disqualification can be limited to certain members. This can happen only when the bye-laws clearly appoint a particular officer as the sole custodian of records and the Committee can show that the other members were not aware of the officer’s lapse and that they took reasonable steps to ensure compliance. In such a situation, the lapse may be personal to that officer and not a collective failure. Only then can the Registrar restrict disqualification to that individual.

¶157

23

¶158

wp14087-2023 & wp14098-2023 Final.doc

¶159

The question the Registrar must not ask is “who was supposed to give the documents”. The correct question is “who failed in their legal duty to make sure that the documents were given”. A Committee cannot escape responsibility by blaming one officer when, in reality, the whole Committee ignored requests, failed to act on the Registrar’s direction and allowed the breach to continue for months.

¶160

When these principles are applied to the present case, the conclusion is clear. Repeated reminders were sent to the Society from January to May 2023. The Registrar issued a clear direction on 12 April 2023. No member of the Committee has shown any steps taken by them to comply. The documents sought were minutes of the Committee’s own meetings. The non-compliance continued until proceedings were initiated. This shows a collective failure, not an individual lapse. There is no material to show that only one officer was responsible or that the rest of the Committee tried to ensure compliance. In these circumstances, the disqualification of the entire Managing Committee is fully supported by the law and cannot be faulted.

¶161

I now consider the appointment of an administrator under Section 77A(1). This section gives the Registrar the power to remove a Managing Committee and appoint an administrator when there are serious lapses in the Society’s management. The law expects the Managing Committee to run the Society in a lawful and orderly manner. When there are grave irregularities, continued mismanagement or clear failure to follow the Act, the Registrar can intervene to protect the Society. In this case, the

¶162

24

¶163

wp14087-2023 & wp14098-2023 Final.doc

¶164

Registrar disqualified the petitioners on 26 May 2023 and appointed an administrator on 29 May 2023. Both decisions were based on the same set of facts. There was long delay in supplying documents. There was a recovery certificate already issued under Section 88 showing financial loss caused by the committee. There were complaints about breach of by-laws. All these factors together show that the Society was not being managed properly. The Registrar could reasonably feel that allowing the same committee to continue would harm the Society. In that background, appointing an administrator was a proper and necessary step. It was not arbitrary or excessive.

¶165

The revisional authority considered their case and dismissed it on 27 October 2023. After losing in revision, they have come to this Court. The fact that statutory remedies existed does not prevent this Court from hearing the matter. But the petitioners cannot say that they were denied any opportunity. They received the show cause notice. They filed a reply. The Registrar gave reasons in his order. There is nothing on record to show any procedural unfairness. The basic requirements of a fair hearing were met. The petitioners also stressed minor points about the exact amount of copying charges and the exact date of payment. These arguments do not help them because the Registrar’s direction to supply documents within seven days was not followed. The documents were given only after proceedings were started. A late payment cannot wipe out earlier non-compliance. The law does not permit a committee to ignore directions for weeks or months and then claim compliance only when action is taken

¶166

25

¶167

wp14087-2023 & wp14098-2023 Final.doc

¶168

against them. I have also considered the judgments cited by the respondents. The principle laid down is that the powers under Section 154B-23 are meant to ensure honesty and accountability. When a member makes repeated requests, when the Registrar gives clear directions and when the Society still fails to comply, the Registrar is entitled to disqualify the committee. This Court cannot substitute its own view of the facts when the record gives a clear and reasonable basis for the Registrar’s action.

¶169

For all these reasons, both writ petitions fail. Writ Petition No. 14087 of 2023 and Writ Petition No. 14098 of 2023 are dismissed. The orders dated 26 May 2023 under Section 154B-23 and 29 May 2023 under Section 77A(1) are confirmed. No costs. Parties shall act in accordance with this judgment.

¶170

All pending interim applications stand disposed of.

¶171

At this stage, learned Advocate for the petitioners seek continuation of ad-interim relief. Since the ad-interim relief was in force for more than one year, the same is continued for a period of 4 weeks from today.

¶172

(AMIT BORKAR, J.)

¶173

26

Jyotindra Patel v. Nair Pushpa Sureshkumar and Ors.

Case brief

What is this about?

What did the court decide?

Jyotindra Patel v. Nair Pushpa Sureshkumar and Ors.

Case brief

What is this about?

What did the court decide?

Why is it important?

What the court decided

Issues for consideration

Cases cited

Statutes considered

Procedural history

Parties & counsel

Coram

Case details

All orders in this case

Similar cases

Nitin Laxmidas Dama vs State of Maharashtra through Its Principal Secretary Ministry of Dairy Development

Smt. Fashibai Ragho Phulore Decd Thru Lhrs Shri. Lahu Ragho Phulore vs Shri. Bala Jagya Medhekar and Ors.

Smt. Fashibai Ragho Phulore Decd Thru Lhr Shri. Lahu Ragho Phulore vs Shri. Bala Jagya Medhekar and Ors.

The Branch Manager, Universal Sompo General Insurance Co. Ltd. vs the Permanent Lok Adalat Mumbai and Anr.

The Branch Manager Universal Sompo General Insurance Co. Ltd. vs the Permanent Lok Adalat Mumbai and Anr.

The Branch Manager Unversal Sompo General Insurance Co. Ltd. vs the Permanant Lok Adalat Mumbai and Anr.