Dismissed

M/S Pub Chamaria Gaon Panchayat Samabay Samiti Ltd. v. the State of Assam and 5 Ors.

Gauhati HC3 Jun 2022I.A.(Civil)/1480/2022

Case brief

AI extract

What is this about?

This single judge dismissed an interlocutory application seeking stay of two orders: suspension of the petitioner society's PDS license and automatic dissolution of its Board of Directors. The court found no prima facie case for stay and distinguished the matter from a related writ petition resolved via consensus on a representation under the 2007 Act.

What did the court decide?

Prayer for staying the operation of the order dated 09.02.2022 suspending the PDS license and the order dated 16.03.2022 dissolving the Board of Directors rejected.

M/S Pub Chamaria Gaon Panchayat Samabay Samiti Ltd. Vs… — Cooperative Societies | Gauhati HC (2022)

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GAHC010097722022

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THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)

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Case No. : I.A.(Civil)/1480/2022

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M/S PUB CHAMARIA GAON PANCHAYAT SAMABAY SAMITI LTD. REPRESENTED BY ITS SECRETARY, ABDUR RAHIM, AGED ABOUT 79 YEARS, S/O- LATE HAJI MAJAFFAR ALI, R/O- VILL AND P.O. HATIPARA, P.S. CHHAYGAON, DIST.- KAMRUP (ASSAM), PIN- 781137.

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VERSUS

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THE STATE OF ASSAM AND 5 ORS. REPRESENTED BY THE COMMISSIONER AND SECRETARY, TO THE GOVERNMENT OF ASSAM, DEPARTMENT OF CO-OPERATION, DISPUR, GUWAHATI-6.

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2:THE DEPUTY COMMISSIONER KAMRUP AMINGAON ASSAM GUWAHATI- 781137. 3:THE REGISTRAR OF CO-OPERATIVE SOCIETIES ASSAM KHANAPARA GUWAHATI-22.

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4:ZONAL JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES GUWAHATI ZONE BHANGAGARH GUWAHATI-5. 5:THE ASSISTANT REGISTRAR CO-OPERATIVE SOCIETIES BHANGAGARH GUWAHATI-5.

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6:THE JUNIOR INSPECTOR/ AUDITOR OF CO-OPERATIVE SOCIETIES IN THE OFFICE OF ASSISTANT REGISTRAR CO-OPERATIVE SOCIETIES BHANGAGARH GUWAHATI-5

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Advocate for the Petitioner : MR J MOLLAH

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Advocate for the Respondent : SC, CO OP

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BEFORE HONOURABLE MR. JUSTICE MANISH CHOUDHURY

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ORDER

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Date : 03-06-2022

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Heard Mr. J. Mollah, learned counsel for the applicant-petitioner; Mr. S.K. Talukdar, learned Standing Counsel, Co-operation Department for the respondent-opposite party nos. 1, 3, 4, 5 & 6; and Ms. M. Barman, learned Junior Government Advocate, Assam for the respondent-opposite party no. 2.

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The applicant has preferred the instant interlocutory application seeking stay of the operation of an order dated 09.02.2022 passed by the opposite party no. 2 and stay of the operation of another order dated 16.03.2022 passed by the opposite-party no. 4. It is apposite to mention that the applicant as the writ petitioner has preferred the connected writ petition, W.P.[C] no. 3420/2022 assailing the said two orders, that is, the order dated 09.02.2022 and the order dated 16.03.2022.

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When the connected writ petition was moved on 30.05.2022, this Court has passed the following order :

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“Heard Mr. J. Mollah, learned counsel for the petitioner; Mr. S.K. Talukdar, learned Standing Counsel, Cooperation Department for the respondent nos. 1, 3, 4, 5 & 6; and Mr. R. Talukdar, learned Junior Government Advocate, Assam for the respondent no. 2.

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The petitioner has instituted this writ petition aggrieved by – [i] an order dated 09.02.2022 passed by the respondent no. 2 whereby the PDS license issued to the petitioner cooperative society has been suspended with immediate affect; and [ii] an order dated 16.03.2022 passed by the respondent no. 4 whereby the Board of Directors of the petitioner cooperative society has been declared to be automatically dissolved for violation of the provisions of Section 32 r/w Section 39 of the Assam Cooperative Societies Act, 2007 and also due to sufferance of disqualification in view of the provisions contained in Sections 37 r/w Section 38[7] r/w Section 49 of the Assam Cooperative Societies Act, 2007. By the order dated 16.03.2022, the respondent no. 4 has appointed one Junior Inspector/Auditor of Cooperative Societies, O/o the Assistant Registrar Cooperative Societies under Section 41[6] of the Assam Cooperative Societies Act, 2007 to perform all the functions of the Board of Directors of the petitioner cooperative society and also to convene the Annual General Meeting [AGM] of the society to constitute the Board of Directors within 90 [ninety] days.

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Mr. Talukdar, learned Standing Counsel, Cooperation Department and Mr. Talukdar, learned Junior Government Advocate, Assam have contended that in so far as the order dated 16.03.2022 is concerned, a writ petition which has been instituted in the name of the petitioner cooperative society at the instance of the Secretary of the society is not maintainable since the Secretary of the society could not be termed as an aggrieved person.

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Issue notice of motion, returnable in 4 [four] weeks.

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As Mr. Talukdar, learned Standing Counsel, Cooperation Department has appeared and accepted notices on behalf of the respondent nos. 1, 3, 4, 5 & 6; and Mr. Talukdar, learned Junior Government Advocate, Assam has appeared and accepted notices on behalf of the respondent nos. 2, no formal notices need to be issued to the said respondents. Mr. Mollah shall furnish requisite number of extra copies of the writ petition along with the annexures, to Mr. Talukdar, learned Standing Counsel,

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Cooperation Department and Mr. Talukdar, learned Junior Government Advocate, Assam within 3 [three] working days from today.

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The name of learned Government Advocate, Assam be reflected in the respondents’ side in the cause-list.”

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Mr. Mollah, learned counsel for the applicant-petitioner has submitted that another similarly situated co-operative society viz. M/s Goroimari Gaon Panchayat Samabay Samiti Ltd. has preferred a writ petition, W.P.[C] no. 3441/2022 aggrieved by an order dated 08.03.2022, whereby, the Board of Directors of the said co-operative society was dissolved under Section 39 of the Assam Co-operative Societies Act, 2007 [‘the Act, 2007’ and/or ‘the 2007 Act’, for short] and a Junior Inspector/Auditor of Co-operative Societies had been appointed under Section 41[6] of the 2007 Act to perform all functions of the Board of the said co-operative society and to convene the AGM of the cooperative society to constitute its Board of Directors within 90 [ninety] days.

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4.1. The learned counsel for the applicant-petitioner has submitted that the present petitioner co-operative society is similarly situated like the co-operative society in the writ petition, W.P.[C] no. 3441/2022 and hence, it is also to be granted the interim relief in the similar manner, as has been granted to the petitioner co-operative society in the writ petition, W.P.[C] no. 3441/2022.

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4.2. Mr. Mollah, learned counsel for the applicant-petitioner in support of his submissions has referred to the decisions of the Hon’ble Supreme Court of India in Jaisri Sahu vs. Rajdewan Dubey, reported in AIR 1962 SC 83, paras 9 & 10; Tribhuvandas Purshottamdas Thakur vs. Ratilal Motilal Patel, reported in AIR 1968 SC 372, paras 7 & 8; and Sant Lal Gupta and others vs. Modern Co-

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operative Group Housing Society Limited and others, reported in [2010] 13 SCC 336, paras 17 & 19.

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I have duly considered the submissions of the learned counsel for the applicant-petitioner.

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By the impugned order dated 09.02.2022 passed by the opposite party no. 2, the license of the applicant-petitioner co-operative society viz. M/s Pub-Chamaria Gaon Panchayat Samabay Samiti Ltd. [‘the Society’, for short] has been suspended with immediate effect. The order dated 09.02.2022 reflects that a show-cause notice dated 22.09.2021 was earlier issued on the ground that the Society was found involved in illegal diversion of 2704.18 Qntls of NFSA rice from the Targeted Public Distribution System Network into the open market for illegal monetary gain, as per report submitted by the Superintendent, FCS & CA, Bureau of Investigation [Economic Offence] [‘the BIEO’, for short]. The Society has been asked to show-cause as its actions are found to have contravened Clauses 18, 21, 22 & 25 of the Assam Public Distribution of Articles Order, 1982 [‘the Articles Order, 1982’, for short] and the terms and condition no. 3[a][i], [ii], [iii], [iv] & [b], 4, 5, 6, 7, 8[1], 8[2] & 9 of the PDS licence issued to the Society under the Articles Order, 1982. When the Society was asked to reply to the show-cause notice dated 22.09.2021, the Society through its Secretary submitted its reply to show-cause notice on 06.10.2021. The documents annexed to the connected writ petition further goes to show that the Bureau of Investigation [Economic Offence] [“the BIEO”, for short], Assam seized a number of articles from the Society vide a Seizure List of even date. It was when the opposite party no. 2 authority found the reply to the show-cause

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notice unsatisfactory, the order dated 09.02.2022 came to be passed by the opposite party no. 2.

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6.1. Order 15[2] of the Articles Order, 1982 has laid down that no order of cancellation of a licensee granted under the Articles Order, 1982 shall be made under the Clause unless the licensee has been provided a reasonable opportunity for stating his case against the proposed cancellation and during pendency or in contemplation of the proceeding of cancellation of the licence, the licence can be suspended for a period not exceeding 90 [ninety] days without giving any prior opportunity to the licensee of stating his case.

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6.2. A perusal of the Clause 15[2] of the Articles Order, 1982 goes to show that a license of a licesee can be suspended for a maximum period of 90 [ninety] days without giving any opportunity to the licensee of stating his case. Thus, Clause 15[2] only provides that a licence cannot be kept under suspension for a period not exceeding 90 [ninety] days without giving any opportunity of stating his case.

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6.3. In the case in hand, the show-cause notice is found to have been issued on 22.09.2021 asking the Society to show-cause as to why the PDS license of Society shall not be cancelled for contravention of the provisions, quoted hereinabove. The show-cause notice dated 22.09.2021 was responded by a reply to show-cause notice dated 06.10.2021. The impugned order dated 09.02.2022, whereby, the PDS license of the Society has been suspended with immediate effect has come to be passed only after consideration of the reply to the show-cause notice submitted on behalf of the Society and also a report

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submitted by the Superintendent, FCS & CA, BIEO, Assam, finding the said reply unsatisfactory. In connection with the allegations of irregularities committed by the Society, a First Information Report [FIR] has also been lodged by the Superintendent, FCS & CA, BIEO and the same has been registered as BIEO Police Station Case no. 22/2021 under Sections 120[B]/420/406, Indian Penal Code r/w Section 7, Essential Commodities Act.

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6.4. In view of the above discussion, I do not find any prima facie case, at this stage, for staying the operation of the impugned order dated 09.02.2022.

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In so far as the order dated 16.03.2022 passed by the opposite party no. 4 is concerned, it is found on perusal of the same that the Board of Directors of the Society viz. M/s Pub-Chamaria Gaon Panchayat Samabay Samiti Ltd. had failed to hold the Annual General Meeting [AGM] of the Society for the Co-operative Year : 2020 – 2021, which is mandatory as per Section 32 of the 2007 Act. Section 39 of the 2007 Act has provided for Annual General Meeting [AGM] and as per Section 39 of the 2007 Act, a general meeting to be termed as Annual General Assembly of a registered co-operative society shall be held at least once in every Co-operative Year within a period of 6 [six] months of close of the financial year to transact the business as provided in the 2007 Act and the Board of Directors shall automatically stand dissolved for not holding Annual General Meeting [AGM] in accordance with the provisions of the 2007 Act and Bye-Laws within 6 [six] months from the expiry of every financial year.

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7.1. It is an admitted position that the Annual General Meeting [AGM] of the Society, M/s Pub-Chamaria Gaon Panchayat Samabay Samiti Ltd. was not

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held for the Co-operative Year : 2020-2021. By the impugned order dated 16.03.2022, the opposite-party no. 4 while dissolving the Board of Directors of the Society for violation of the provisions contained in Section 39 of the 2007 Act, has further appointed one Junior Inspector/Auditor of Co-operative Society to perform all functions of the Board of Directors of the Society and to convene the Annual General Meeting [AGM] of the Society in order to constitute the Board of Directors of the Society within 90 [ninety] days.

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7.2. It is apposite to mention that sub-section [6] of Section 41 of the 2007 Act has prescribed where a Board fails to arrange for holding election before the expiry of the term of the Board, the Registrar shall convene a General Meeting by appointing an Officer of the Co-operative Department for Constitution of the Board within 90 [ninety] days from the date of such appointment and the officer so appointed shall perform all functions of the Board during the said period of 90 [ninety] days at the cost of the Society. When the state of affairs of the Society are considered qua the statutory provisions of the 2007 Act, mentioned herein, this Court has not found any prima facie violation of statutory provisions while passing the impugned order dated 16.03.2022.

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7.3. From the averments made in the connected writ petition, it is noticed that the writ petition has been instituted in the name of the applicant-petitioner society at the instance of the Secretary of the applicant-petitioner society. The Secretary is a full-time employee of the applicant-petitioner Society. By the impugned order dated 16.03.2022, the Board of Directors of the applicantpetitioner Society has been dissolved by operation of law contained in Section 39 r/w Section 32 of the Act, 2007. The writ petition is not instituted at the

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instance of the elected members of the dissolved Board of Directors. The Secretary herein has not been able to show what legal right of his has been violated by such dissolution as the applicant-petitioner Society is a body corporate. The existence of the legal right which is allegedly violated is the foundation for invoking the extra-ordinary jurisdiction of the Court under Article 226 of the Constitution of India. The Secretary will be required to show prima facie violation of any of his existing legal right which he has not been able to establish so far.

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In the context of the above discussion when the order dated 27.05.2022 passed in W.P.[C] no. 3441/2022 is looked at, it is noticed that at the time of hearing of the said writ petition on 27.05.2022, the learned Standing Counsel, Co-operation Department had submitted that there was no legal infirmity in the order dated 08.03.2022 impugned therein which resulted into automatic dissolution of the Board of Directors of the petitioner co-operative society therein under Section 39 of the 2007 Act and had further submitted that in the event a representation was filed on behalf of the petitioner co-operative society therein seeking exemption under the newly inserted Section 130A of the 2007 Act, the same would be considered within a time frame. In response to the said submission made by the learned Standing Counsel, Co-operation Department, the learned counsel for the petitioner made the submission that the petitioner was agreeable to the said proposal and a time frame should be fixed for disposal of such representation. Having taken note of the consensus arrived at the bar, the writ petition, W.P.[C] no. 3441/2022 was closed by allowing the petitioner co-operative society therein to submit an appropriate application before the Secretary to the Government of Assam, Department of

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Co-operation with a specific prayer to consider its case under the provisions of newly inserted Section 130A of the 2007 Act and to take a decision about exemption. The writ petition, W.P.[C] no. 3441/2022 was closed by observing that in the event a representation was submitted by the petitioner co-operative society therein within a period of 1 [one] week from 27.05.2022, the same should be considered expeditiously and till disposal of the representation, the Junior Inspector/Auditor of Co-operative Societies appointed by the Joint Registrar of Cooperative Societies, Guwahati shall not take any steps towards holding of the election of the petitioner co-operative society therein.

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From the contents of the order dated 27.05.2022 passed in W.P.[C] no. 3441/2022, it has clearly emerged that the writ petition was closed when the learned counsel for the parties had arrived at the broad consensus that the petitioner co-operative society therein would submit a representation before the Secretary to the Government of Assam, Department of Co-operation seeking exemption from holding the Annual General Meeting of the Society under Section 130A of the 2007 Act and the Government in the Department of Cooperation would consider the same in an expeditious manner and would pass a decision thereon.

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In the case in hand, the learned counsel for the applicant has not made any submission regarding submission of any such representation before the Government for consideration of its case for exemption under Section 130A of the 2007 Act and has, on the other hand, prayed for stay of the impugned order dated 09.02.2022 and the impugned order dated 16.03.2022.

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The decisions in Jaisri Sahu [supra]; Tribhuvandas Purshottamdas Thakur [supra]; and Sant Lal Gupta [supra] are with regard to judicial propriety and consistency. It is settled position of law that a co-ordinate bench cannot comment upon the discretion exercised or judgment rendered by another coordinate bench of the same Court and the rule of precedent is binding. It has been held that a Single Judge of a High Court is ordinarily bound to accept as correct judgments of Courts of Co-ordinate jurisdiction and of Division Benches and of the Full Benches of his Court and of the Hon’ble Supreme Court and the reason of the rule which makes a precedent binding lies in the desire to secure uniformity and certainty in the law.

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It has emerged from the order dated 27.05.2022 that the same was passed when the learned counsel for the parties had arrived at a broad consensus. On the other hand, the learned counsel for the applicant-petitioner in the case in hand has pressed for an interim order of stay of the impugned order dated 09.02.2022 as well as of the impugned order dated 16.03.2022. As such, the decisions cited by the learned counsel for the applicant is not found relevant for passing of an interim order in this interlocutory application.

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In the light of the above discussion, the prayer for staying the operation of the impugned order dated 09.02.2022 and the impugned order dated 16.03.2022 is not found merited. Consequently, this interlocutory application stands dismissed.

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JUDGE Comparing Assistant

M/S Pub Chamaria Gaon Panchayat Samabay Samiti Ltd. v. the State of Assam and 5 Ors.

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M/S Pub Chamaria Gaon Panchayat Samabay Samiti Ltd. v. the State of Assam and 5 Ors.

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