Remanded

Rajbir Singh v. State of Haryana & Ors.

Punjab & Haryana HC8 Feb 2012CWP/9397/2011

Case brief

AI extract

What is this about?

In a writ petition, the court addressed a challenge to the society's refusal to co-opt experts under unamended bye-laws following a 2006 amendment removing the parent Act's co-option provision. The Court remitted the issues on merits to the Registrar Cooperative Societies to independently decide the interplay between the bye-laws and the amended Act.

What did the court decide?

The writ petition is disposed of and remitted to the Registrar Cooperative Societies, Haryana to decide the issues as a preliminary matter within two months.

Rajbir Singh Vs State of Haryana & Ors. — Cooperative Societies | Punjab & Haryana HC (2012)

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CWP No.9397 of 2011 1

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In the High Court for the States of Punjab and Haryana at Chandigarh

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Date of decision:8.2.2012

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Rajbir Singh ..Petitioner

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Versus

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State of Haryana and others ..Respondents

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Coram: Hon'ble Mr. Justice Rajiv Narain Raina

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Present: Mr.G.S. Sandhu, Advocate for the petitioner

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Ms. Kirti Singh, DAG, Haryana for respondents no.1 to 3

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Mr.Ashish Aggarwal, Advocate for respondents no.4 and 5

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To be referred to the reporters or not?

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Whether the judgment should be reported in the

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digest?

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Rajiv Narain Raina,J

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This petition was filed on 24.5.2011 impugning letter dated 24.3.2011 (Annexure P-2) issued by the Manager, Sonepat Cooperative Marketing Society Limited, Sonepat (for short “respondent-Society) declining the prayer of the Directors for issuing Agenda for co-opting two Directors to the respondentSociety from amongst ''agriculture or marketing experts" as enabled and

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CWP No.9397 of 2011 2

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permitted under Bye-law 30 of the Bye-laws of the respondent-Society. The request has been declined on the ground that there is no provision under Section 29 (4) of the Haryana Cooperative Societies Act, 1984 (for short “the Act”) to nominate non-official members since the Clause for nomination/cooption under the Act stands omitted by Haryana Act No.19 of 2006 and because of the amendment, there is no provision of co-option in Cooperative Marketing Societies.

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The few facts which may be necessary to understand the issue involved is that the election to the Board of Directors of the respondent-Society took place on 12.3.2011 electing six Directors. Three members were elected out of individual members of the respondent-Society whereas three members were elected out of member societies of the respondent-society. There are two kinds of members i.e. individual members and the representatives of the cooperative societies. Both of them fall within the purview of election to the Board of Directors. Bye-law 30 deals with the composition of Managing Committee. Byelaw 30(iv) provides that the Managing Committee may grant representation to “agriculture or marketing experts”. By amendment to the Act which came into effect from 19.1.2006, the provision of co-option stands deleted. The issue raised by the petitioner in the present case is whether the bye-laws of the Society which remain unamended, survive after the amendment of 2006. The petitioner insists that the bye-laws give right to the respondent-society to induct two experts. It was this demand that was made before respondent-Society which has been turned down. The amendment has deleted Section 29(4) of the Act. Section 29 of the old Act dealt with “nomination and co-option of the members on the Committee of the Society”. The old Act laid down that notwithstanding anything contained in sub-section (1) of Section 28, the nomination and cooption procedure would be governed by sub-section (i) to (iv) of Section 29. Sub-section (4) of Section 29 of the old Act which now stands deleted, read as under:-

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“29 (4) Notwithstanding anything contained in the bye-laws of a society, the Government may, by general or special order,

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CWP No.9397 of 2011 3

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direct that on the committee of such society or class of societies, as the Government may specify, there will be coopted by members of the committee of such society one-third members belonging to the weaker sections out of whom at least one such member shall belong to the Scheduled Caste: Provided that such co-option shall not be made if one-third members belonging to the weaker section including that of Scheduled Caste have been elected on such committee: Provided further that in case no such co-option is made, the Registrar may nominate such number of members.”

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On the requests of the petitioner and three others (non-petitioners) with

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whom the petitioner had made request for co-option, vide letter dated 5.4.2011 (Annexure P-4) issued by the Registrar Cooperative Societies, Haryana, the Deputy Registrar, Cooperative Societies, Karnal was directed to take action as per bye-laws of the Society and the Act. Therefore, no definite opinion was expressed as to the inter-play between the bye-laws and the amendment. Vide notice dated 16.5.2011 (Annexure P-5), the Presiding Officer appointed under Section 30 of the Act issued memo calling meeting of the Managing Committee of the respondent-society for 1.6.2011 to consider the agenda regarding election of office bearers and for electing President and Vice-President. It is this notice (Annexure P-5), that has brought the petitioner to this Court.

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On 25.5.2011, this Court issued notice of motion and stayed operation of the impugned order (Annexure P-2) till further orders. In view of the interim order, the election did not take place for the impugned agenda (Annexure P-5) and the meeting did not materialize. However, on 14.6.2011 a fresh agenda was issued for consideration in a meeting fixed for 30.6.2011. The petitioner filed an application for stay before this Court. Notice of the application was issued on 23.6.2011 and the election was deferred by the respondents on their own without there being any interim directions by this Court. When the first and second meetings did not materialize, a third attempt was made by the respondents with issuing a fresh agenda on the same subject matter on 12.10.2011 which was to be considered in a meeting to be held on 29.10.2011. It was under this agenda that elections for all office bearers were finally held. Since a new cause of action had arisen, the petitioner preferred another writ

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CWP No.9397 of 2011 4

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petition bearing CWP No.22045 of 2011 challenging inter alia the election. On 28.11.2011, Mr.G.S.Sandhu, learned counsel appearing for the petitioner in the fresh writ petition withdrew the said petition to enable the petitioners i.e. Rajbir Singh (the petitioner herein) with co-petitioner Smt Ranbiro Devi to avail their appropriate remedy under the law. The said writ petition was consequently dismissed as withdrawn with liberty as prayed for. Mr.Sandhu, learned counsel has stated that an election petition was filed and remains pending before the Registrar Cooperative Societies, Haryana. He, however, submits that the issue raised in this petition was similar to the one raised in the subsequent writ petition which issue is still alive and requires to be determined. He is, therefore, half heartedly in the present writ petition prays that the issue raised in this petition be remitted to the Registrar Cooperative Societies, Haryana for its consideration on merits in the election petition itself so that the court of first instance can opine as to the effect of bye-law 30 which permits co-option/nomination of agriculture and marketing experts to be considered and decided in the background of the amendment. The bye-laws were framed on 13.3.2000 and the amendment came into effect from 19.1.2006.

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Mr.Sandhu, learned counsel submits that in the present case, Section 29 (b) of the Act does not apply since the Government does not have any share in the respondent-society whereas first proviso to this Section lays down that the share capital contribution by the Government shall not exceed 25% of the paid up share capital He relies on second proviso of Section 29 of the Act to contend that there is necessity of professional Directors on board and the respondentSociety being a marketing society would be best administered with the aid and advice of two agriculture/marketing experts provided for under the bye-laws. Mr.Sandhu, learned counsel submits that the balance-sheet of respondentSociety for the year 2009-2010 shows profit of about Rs.1.00 crore, and therefore, the Society is of substantial size and requires to be professionally managed. The Marketing Society by nature of its existence has to compete with Ahartis for procurement of produce at par with Commission Agents. He cites the

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CWP No.9397 of 2011 5

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provisions of Section 102 of the Act that the matter lies under the domain of Registrar Cooperative Societies, Haryana. He refers to paragraph 9 of the written statement filed by the Registrar Cooperative Societies, Haryana where the omission of Section 29 (iv) of the Act has been pressed to contend that there is no provision of co-option in a marketing society. However, under Section 28 of the Act, there is provision that at least one member belonging to Scheduled Caste and one women shall also be represented through election of every committee of a cooperative society in the manner prescribed. Such representation has been accorded in the present case. A member belonging to Scheduled Caste and a women member are on Board. There is no room to accommodate marketing experts as envisioned in Bye-law 30.

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Mr.Sandhu, learned counsel has produced a copy of the proceedings of the meeting of the Board of Directors of the Sonepat Central Cooperative Bank Ltd., Sonepat held on 23.11.2010. Agenda Item No.22 was to consider cooption of professional Directors on the Board of Directors of the Bank. The agenda was considered on 25.11.2010 and it was ratified and two persons were unanimously co-opted as professional Directors of the Bank. On the strength of this, Mr. Sandhu, learned counsel submits on analogy that what is true for the Bank ought to be true for a Marketing Society. The professional Directors of a Bank would be in the same position as the agriculture/marketing experts under bye-law 30.

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Mr.Aggarwal, learned counsel on the contrary has argued that a sea change has been brought about by the amendment of 2006. He has referred to Section 9-A of the Act which has been newly incorporated and which now grants power to make by-laws for the first time. Hithertofore, only Section 8 of the Act operated. Mr. Aggarwal, refers to the written undertaking given at the end of the bye-laws of the respondent-Society that the bye-laws were placed before the Registrar Cooperative Societies for approval and was approved with the following caution; words have been written in Hindi which read as under:“Ein Bye-laws mey Act tatha Rules ki koi ulanghana nahi hai”

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CWP No.9397 of 2011 6

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He, therefore, argues that the bye-laws have to be consistent with the rules and even though the bye-laws are prior to the amendment, compliance of the amended law would be necessary. Mr. Aggarwal, learned counsel has taken me to the various amendments in the Act to impress upon this Court that wherever the Legislature wanted co-option, it has spoken and has specified, to wit in the second proviso to Section 29 where which banks have been mentioned. Therefore, the provisions of the amendment and the bye-laws have to be read harmoniously and consistent with the provisions of the amended law and in consonance with each other. Mr. Aggarwal, learned counsel has relied on the following decisions:-

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(i)Darbara Singh vs. Deputy Commissioner, 1984 Recent Revenue Reports 369;

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(ii)Naib Singh vs. Mihan Singh, 1984 Recent Revenue Reports 371;

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(iii)Ram Jattan vs. The State of Haryana and others, 1976 PLJ 24;

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(iv)Sadhu Ram and Bhup Singh v. State of Haryana, (P&H) (DB) 1976 PLR

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308

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(v)Co-operative Central Bank Ltd. And others v. Additional Industrial Tribunal, Andhra Pradesh, Hyderabad and others etc. AIR 1970 Supreme Court 245

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(vi)Joginder Singh President, Rupar Central Cooperative Bank Ltd., Rupar vs. The Registrar Cooperative Societies, Punjab, 1984 Recent Revenue Reports 326.

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The arguments and counter arguments of the learned counsel for the parties have been noticed above to define the area which would require to be determined by the Registrar Cooperative Societies, Haryana in the election petition as parties are agreed and have no objection that the above issues be directed to be remitted to the Registrar Cooperative Societies, Haryana in the election petition for consideration as a preliminary issue. There can be no gainsaying that this matter cannot be proceeded further, in view of the statement of Mr. Sandhu withdrawing CWP No.22045 of 2011 with liberty to avail his

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CWP No.9397 of 2011 7

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alternative remedy.

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I, therefore, direct that the Registrar Cooperative Societies, Haryana would consider all the issues on merits, without being influenced by anything said in this order. He would take an independent decision on the effect of byelaw 30 of the Bye-laws of the respondent-Society in the context of Amendment of 2006 to the Act. This writ petition is accordingly disposed of with the above directions with a request to the Registrar Cooperative Societies, Haryana to decide the issues raised in this petition, and in the context of the arguments addressed by the learned counsel for the parties broadly noticed above and other issues which may be pressed before him and to decide the matter as a preliminary issue within two months from the date of supply of a certified copy of this order.

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(RAJIV NARAIN RAINA) JUDGE

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8.2.2012 MFK

Rajbir Singh v. State of Haryana & Ors.

Case brief

What is this about?

What did the court decide?

Rajbir Singh v. State of Haryana & Ors.

Case brief

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