# RAJENDRA PRASAD YADAV AND ORS v. STATE OF MADHYA PRADESH AND ORS

- **Citation:** [1997] Supp. 1 S.C.R. 716
- **Court:** Supreme Court of India
- **Decided:** 1997-07-09
- **Case number:** Civil Appeal No. 4318 of 1997
- **Bench:** K. Ramaswamy, D.P. Wadhwa
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/rajendra-prasad-yadav-and-ors-v-state-of-madhya-pradesh-and-ors-16089
- **Pages:** 34

## Headnote

Cooperative Societies-M.P. Cooperative Societies Act, 1960-Section
49(8)(ii)-'Board of Directors and Managing Committee of the Apex
Society-Election to-Failure to hold election to Board of Directors and
C Management Committee within time-Election to Managing Committee representatives of Central Societies, primary societies-Condition precedent for
completion of election process of the Apex Society-Obligation, to conduct
such elections on request of the respective committees of the Central Societies
lies on Registrar and not on Apex Society-Held, the liability of statutory
D vacation of office under Section 49(8)(ii) on expiry of term cannot be saddled
on Board of Directors, President, Vice-President and Members of Management Committee of the Apex Society when Registrar has failed to hold election
to Central Bank and P1imary Societies-However, whole process of election
having since been completed and election to the board of the Apex Society
E having also been over, writ petition filed by the appellants became infructuous
and hence liable to be dismissed.
Constitution of India, 1950-Article 226-Writ of Quo Wa"anto-lssusance of-Court issued Writ of Mandamus-Held, Writ of Quo Wa"ants
cannot be issued to disobey writ of Mandamus already used and allowed to
F become final.
District Co-operative Central Bank sent delegates to the M.P. State
Co-operative Bank Ltd., the 'Apex Bank'. On August 24, 1984 when the first
meeting of the Board of Directors of the Apex Bank was held the term of
office of three years started running. The President and Vice-President,
G and other office bearers from the Board of Directors were elected, resulting
in constitution of the Board of Directors and the Managing Committee of
the Apex Bank. The term of the representatives of the Central Bank, Board
of Directors and of their office bearers was co-terminus with the term 'or
the Managing Committee of the Central Bank. Equally, the term of the
H Board of Directors and of the Managing Committee of the Apex Bank was
716
--
•.
R.P. YADAVv. STATE
717
co-terminus, which was three years, later amended as five years as per M.P. A
Cooperative bye-laws 41(1). The three-tier system of Co-operative Society
existed therein.
By Resolution dated April 26, 1990, the Apex Bank applied to the
Registrar to hold elections. On failure to do so matter was filed in High B
Court which gave a direction that election he conducted in accordance with
the procedure prescribed under law. On the same date, Ordinance No. 2
of 1990 replaced by Act (14 of 1990) was passed by the State Legislature
terminating the term of the Committees; the Registrar was directed to take
over management of all the Primary Societies, Central Banks and of the
Apex Bank. As a consequence, the Committees of all the Societies were C
superseded by proceedings dated April 26, 1990. The Board again filed writ
petition. The High Court by its judgment dated June 21, 1993 reported as
A.P. Sastri case declared the Amendment Act (14 of 1990) amending
Section 49(8) of the M.P. Co- operative Societies Act, 1960 as ultra vires the
legislative power. As a necessary consequence, it held that the officers of D
the earlier Managing Committee would continue to function, till election
were held in accordance with law. Subsequently, Writ Petition was filed
seeking writ of quo wa"anto to show cause under which authority the
appellants were functioning. In the meanwhile Section 49(8) was amended
by Act 12 of 1994. The High Court disposed of the writ petition on finding
that the appellants deliberately delayed the conduct of election and that E
they had no right to continue in office after the expiry of the term.
In appeal to this court the appellants contended that ifthe Registrar
fails to conduct timely elections to the primary societies and district
societies, existing Board of Directors, President, Vice-President and F
members of Managing Committee of the Apex Society cannot be deemed
to have vacated their office on . expiry of t

## Text

_Characters 0–39,390 of 79,224. This is a partial read: ask again with offset=39390 for what follows._

A
RAJENDRA PRASAD YADAV AND ORS.
v.
STATE OF MADHYA PRADESH AND ORS.
JULY 9, 1997
B
[K. RAMASWAMY AND D.P. WADHWA, JJ.]
Cooperative Societies-M.P. Cooperative Societies Act, 1960-Section
49(8)(ii)-'Board of Directors and Managing Committee of the Apex
Society-Election to-Failure to hold election to Board of Directors and
C Management Committee within time-Election to Managing Committee representatives of Central Societies, primary societies-Condition precedent for
completion of election process of the Apex Society-Obligation, to conduct
such elections on request of the respective committees of the Central Societies
lies on Registrar and not on Apex Society-Held, the liability of statutory
D vacation of office under Section 49(8)(ii) on expiry of term cannot be saddled
on Board of Directors, President, Vice-President and Members of Management Committee of the Apex Society when Registrar has failed to hold election
to Central Bank and P1imary Societies-However, whole process of election
having since been completed and election to the board of the Apex Society
E having also been over, writ petition filed by the appellants became infructuous
and hence liable to be dismissed.
Constitution of India, 1950-Article 226-Writ of Quo Wa"anto-lssusance of-Court issued Writ of Mandamus-Held, Writ of Quo Wa"ants
cannot be issued to disobey writ of Mandamus already used and allowed to
F become final.
District Co-operative Central Bank sent delegates to the M.P. State
Co-operative Bank Ltd., the 'Apex Bank'. On August 24, 1984 when the first
meeting of the Board of Directors of the Apex Bank was held the term of
office of three years started running. The President and Vice-President,
G and other office bearers from the Board of Directors were elected, resulting
in constitution of the Board of Directors and the Managing Committee of
the Apex Bank. The term of the representatives of the Central Bank, Board
of Directors and of their office bearers was co-terminus with the term 'or
the Managing Committee of the Central Bank. Equally, the term of the
H Board of Directors and of the Managing Committee of the Apex Bank was
716
--
•.
R.P. YADAVv. STATE
717
co-terminus, which was three years, later amended as five years as per M.P. A
Cooperative bye-laws 41(1). The three-tier system of Co-operative Society
existed therein.
By Resolution dated April 26, 1990, the Apex Bank applied to the
Registrar to hold elections. On failure to do so matter was filed in High B
Court which gave a direction that election he conducted in accordance with
the procedure prescribed under law. On the same date, Ordinance No. 2
of 1990 replaced by Act (14 of 1990) was passed by the State Legislature
terminating the term of the Committees; the Registrar was directed to take
over management of all the Primary Societies, Central Banks and of the
Apex Bank. As a consequence, the Committees of all the Societies were C
superseded by proceedings dated April 26, 1990. The Board again filed writ
petition. The High Court by its judgment dated June 21, 1993 reported as
A.P. Sastri case declared the Amendment Act (14 of 1990) amending
Section 49(8) of the M.P. Co- operative Societies Act, 1960 as ultra vires the
legislative power. As a necessary consequence, it held that the officers of D
the earlier Managing Committee would continue to function, till election
were held in accordance with law. Subsequently, Writ Petition was filed
seeking writ of quo wa"anto to show cause under which authority the
appellants were functioning. In the meanwhile Section 49(8) was amended
by Act 12 of 1994. The High Court disposed of the writ petition on finding
that the appellants deliberately delayed the conduct of election and that E
they had no right to continue in office after the expiry of the term.
In appeal to this court the appellants contended that ifthe Registrar
fails to conduct timely elections to the primary societies and district
societies, existing Board of Directors, President, Vice-President and F
members of Managing Committee of the Apex Society cannot be deemed
to have vacated their office on . expiry of the statutory term and the
Registrar cannot assume office of the Board of Directors or Managing
Committee of Apex Society.
The respondents contended that on expiry of the term of the G
President, two Vice-Presidents of the Board of Directors and the term of
the Managing Committee which being co-terminus with the Board of
' ' Directors must be deemed to have vacated their officers. Thereby, the
Registrar is not entitled to assume office of the Board of the Directors and
the Managing Committee.
H
718
SUPREME COURT REPORTS [1997] SUPP.1 S.C.R.
A
HELD : Per K. Ramaswamy, J.
B
1.1. For completion of the electoral process of Apex Bank, election
to the Primary Societies and in turn election to the managing committee
of each of the District Central Banks and election of one representative
from each of the 45 Central Banks as members of the Apex Bank, as the
two steps are condition precedent and are necessary. Until then,
constitution of the Board of Directors and the Managing Committee of the
Apex Bank cannot be done. As a pre-condition for completion of these two
sequential steps, i.e., (i) election of the President and two Vke-Presidents
and (ii) election of 5 elected member-Directors to the Management
C Committee, the election of a representative by the General Body of the
Managing Committee alongwith members of its Managing Committee is
mandatory and are necessary concomitant. For the latter election, the
elections to the Primary Societies, which in turn simultaneously elect the
Managing Committee and representatives to Central Bank, is also
J) necessary. [741-B-E]
E
F
G
1.2. The term of the representatives is co-terminus with the term of the
Managing Committee of the Central Bank or the Apex Co-operative
Societies. They shall, however, be entitled to remain in office alongwith
other nominated members of the Board of Directors of the Apex Bank under
the bye-laws of the Apex Bank until the respective successors assume office.
The constitution of the Board Directors and also constitution of the Manag·
ing Committee of the Apex Bank is not complete without the election of the
representatives by the concerned Central Banks or President of Apex
Cooperative Societies. The President and Vice-President of the Apex Bank
cannot be elected. The Managing Committee cannot be constituted without
electing the members of the Managing Committee from among the Board of
Directors, as per the bye-laws. That is how the three-tier system of election
bas got interlinked and become inseparable and in view of the unbreakable
interlink, the Board cannot be saddled with the liability of statutory vacation of the office on expiry of the term, unless the Registrar had the election
conducted to the Central Banks or Apex Cooperative Societies, as the case
may be. Preceding there to, election to the Managing Committee of Primary
Society is mandatory. [741-F-H; 742-A-B]
13. Under the bye-laws of the apex bank there is no obligation or duty
H cast on it to have the elections to the Managing Committee or repre·
...
.I>
RP. YADAVv. STATE
719
sentation to the Central Bank or Apex Cooperative Society conducted. It is A
the power, the function and duty under the Act of the Registrar, on a
request made by· the respective committees of the Central B1mks or Apex
Cooperat.ive Society concerned to conduct elections. Thus, it is difficult to
accept that on expiry of the term of President, two Vice· Presidents of the
Board of Directors and the term of the Managing Committee which being B
co-terminus with the Board of Directors must be deemed to have vacated
their offices. Thereby, the Registrar is not entitled to assume office of Board
of the Directors and Managing Committee. Thus, the ftegistrar was unjus·
tified to assume charge of the Board of Directors and Managing Committee
of the Apex Bank. (742-H)
2. This Court in A.P. Sastri's case issued mandamus with the decla·
ration that the Officers of the Managing Committee of the Petitioner
Society would continue to function till elections are held in accordance with
the law. In view of the above mandamus, without conducting the elections
c
in accordance with the provisions of the Act, Rules and bye-laws, the
Registrar cannot assume suo motu power to terminate the term of the D
Board of Directors and the Managing Committee by statutory declaration
and assume charge of the management of the Apex Bank. Therefore, as long
as the writ of mandamus is not complied with and remains in operation a
court cannot issue writ of quo wa"anto to disobey the writ of mandamus
already issued by the High Court and allowed it to become final. [743-A·E)
A.P. Sastri & Others v. State of Madhya Pradesh, (1993) 2 M.P.J.R. 33,
referred to.
E
3. The new Board of Directors elected the President, two Vice-Presi·
dents and five members of the Managing Committee of the Apex Bank must F
have, by now, been elected and assumed the office; therefore, it is futile to
issue the writ as prayed for. [743-G-H)
HELD: Per D.P. WADHWA, J. (Supplementing)
1.1. The term of the Board would be five years from the date of its G
first meeting when it also elects one President and two Vice-Presidents. The
Board being continuous body, the five years term would, therefore, apply
only to the election of President and two Vice-Presidents and Section 49(8)
of the M.P. Cooperative Society Act puts an obligation on the outgoing
committee of the society to hold elections prior to the expiration of its term
would apply, in the case of the apex society only to the election of President H
720
SUPREME COURT REPORTS [1997] SUPP. 1 S.C.R.
A and two Vice-Presidents as per its byelaws. [747-F-H; 748-A-C]
1.2. The interpretation that the election of the new board is
dependent on the elections first to be held of the primary society and then
of the Central Society is a misconception. If the election to the Board of
the apex body is to be dependent on the election first to be held by the
B primary and then by the district bodies, possibly with different byelaws, it
can be anybody's guess as to when the election to the Board of the apex
body would be held. [749-A-B]
1.3. lfthe Board failed to take steps to hold elections of the President
C and two Vice-Presidents in terms of sub-section (8) of Section 49 of the
Act, the Registrar would be competent to assume charge. [748-F]
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4318 of
1997.
D
From the Judgment and Order dated 22.1.97 of the Madhya Pradesh
High Court in W.P. No. 5143 of 1996.
G.L. Sanghi, Ashok Kr. Gupta, A.R. Siddiqui and Mr. Vivek Tanka ·
for the Appellants.
E
S.S. Ray, S.K. Agnihotri, Biswajit Meitei, Madhur Dadlani and P.K.
Manohar for the Respondents.
F
G
The Judgments of the Court was delivered by
K. RAMASWAMY, J. Leave granted.
We have heard learned counsel on both sides.
This appeal by special leave arises from the judgment of the Division
Bench of the Madhya Pradesh High Court, Jabalpur Bench passed on
January 22, 1997 in Writ Petition No. 5143/96.
Section 2(a-i) of the Madhya Pradesh Co-operative Societies Act,
1960 (Act 17 of 1961) (for short, 'the Act') defines 'Apex Society' to mean
a society whose principal object is to provide facilities for the operation of
other societies affiliated to it and whose area of operation extends to the
whole State of Madhya Pradesh. Section 2( c-i) defines 'Central Society' to
H mean a Co-operative Land Development Bank or any other society whose
' -
-
R.P. YADAVv. STATE[K. RAMASWAMY,J.)
721
area of operation is cm1fined to a part to the State and which has as its A
principal object the promotion of the principal object and the provision of
facilities for the operation of same type of societies and for other societies
affiliated to it and not less than five members of which are societies. Section
2( c-ii) defines 'Central Cooperative Bank' to mean a resource society
registered or deemed to be registered under this Act. Section 2( d) defines B
'Committee' to mean the Board of a management by whatever name called
constituted under Section 48. Section 2G) defines 'Farming Society' to
mean a society formed with the object of promoting development of land
and better methods of cultivation, and includes a better farming society,
tenant farming society, collective farming society, joint farming society,
irrigation society and a crop protection society. Section 2( r) defines C
'Member' to mean a person joining in the application for the registration
of a society or a person admitted to membership after registration in
accordance with this Act, the rules and the bye-laws applicable to such
society and includes the State Government when it subscribes to the share
capital of a society. Section 2(t-i) defines 'Officer' to mean a person elected D
or appointed by a society according to its bye-laws to any office of such
society and includes Chairman, Vice-Chairman, President, Vice-President,
Managing Director etc., Member of the Committee and any other person
elected or appointed under this Act, the rules or the bye-laws to give
directions in regard to the business of such society. Section 2(u-i) defines
'Primary Society' to mean a society which is neither an Apex Society nor a E
Central Society. Section 2( x-i) defines 'Representative' to mean a member
of the society to represent the society in other societies. Section 2(z- i) (aa)
defines 'State Co-operative Bank' to mean the Madhya Pradesh State
Cooperative Bank, Limited.
Section 4 of the Act obligates the registration of a society and
envisages that subject to the provisions of this Act, a society which has as
F
its objects the promotion of the economic interest of its members or their
general welfare in accordance with co-operative principles or a society
established with the object of facilitating the operations of such a society, G
may be registered under this Act. The registration has been envisaged
under Section 9 and the societies have been classified into 11 categories in
sub-section (1) of Section 10. The details of which are not material for the
purpose of this case. Sub-section (1-a) of Section 10 further empowers the
Registrar to classify the societies enumerated in clauses (i) to (xi) of
sub-section (1-a) which again makes three heads, namely : (a) Apex H
722
SUPREME COURT REPORTS [1997] SUPP. 1 S.C.R.
A Society; (b) Central Society; and ( c) Primary Society. Right to membership
has been conferred by Section 19 envisaging in sub-section (1) thereof that
no person shall be admitted as a member of a society except the
enumerated categories, namely : (a) an individual; (b) any other society;
( c) to ( e) are omitted as being not relevant for the purpose of this case;
B and (f) the State Government. Under sub-section (2), notwithstanding
anything contained in this Act or rules or in the bye-laws of a society, where
the State Government has contributed to the share capital of a society, the
liability of the State Government shall be limited to the face value of the
shares held by it.
C
Section 22 gives right to vote. Sub-section (1) says that every member
of the society shall have one vote in the affairs of the society. The other
details in sub-section (2) to (8) are not material for the purpose of this
case, hence omitted. Section 23 prescribes the manner of exercising vote.
Sub-section (1) thereof postulates that every member of a society shall
D exercist;.. his vote in person and no member shall be permitted to vote by
proxy. Provided that subject to any rules made under this Act - (i)(a) a
society which is a member of another society may appoint one of its
members as a representative to vote on its behalf; and (b) not necessary
for the purpose of this case. Section 23(ii) says that the State Government
may nominate one of its officers as its representative, to vote or otherwise
E
participate in its behalf in tne affairs of the society of which such society
or the State Government is a member. Other details are not necessary for
the purpose of this case, hence omitted. Section 47-A prescribes the
functions of Apex society. Sub-section (1) thereof says that the Apex
society may, for servicing its constituents and in accordance with its
F byelaws, perform the functions enumerated therein. Sub-section l(k)
enjoins to ensure timel} conduct of elections in member societies.
Chapter V deals with "Management of Societies" and sub-section (1)
of Section 48 says that the final authority in a society shall vest in the
general body of members. The proviso is not relevant, hence omitted.
G Sub-section (2) of section 48 says that subject to sub-section (1), the
management of every society shall vest in a committee constituted in
accordance with this Act or rules made thereunder or byelaws of the
Society and it shall exercise such powers and perform such duties as may
be conferred or imposed respectively by the Act or rules made thereunder
H
or byelaws of the society. Sub-section (3) if not relevant for the purpose of
...
-
'.
R.P. YADAVv. STAIB[K.RAMASWAMY,J.)
1'13
this case, hence omitted. Sub-section (5) of Section 48 says that there shall A
be a President/Chairman and two Vice-Presidents. The details of
representation of the Vice-Chairman are not relevant for the purpose of
· this case, hence omitted. Section 48-B gives power to the Representatives
and delegates to represent their society or group of members.
Sub-section (1) says that every committee of society shall at the time B
of election of Chairman or Vice-Chairman, also elect representative who
shall represent it in other society and che representative so elected shall
not be withdrawn by the Committee till the next election of the committee.
Sub-sections (2) and (3) are not relevant for the purpose of this case, hence
omitted. Section 48-C provides Powers of the Committee as under :
C
The Board or the Committee of a society shall in accordance with
the byelaws, have power to -
(a) admit and terminate membership; (b) elect the Chairman and
other office bearers; clauses (c) to (h) are not relevant for the purpose of D
this case, hence omitted.
•
Section 7-A(i) provides that the term of the committee shall be five
years from the date on which first meeting of the committee is held. Section
7-A(ii) provides that the term of the representative elected by the E
committee of the society shall be co-terminus with the term of the
committee of the society for which representative is elected. The other
details are not material for the purpose of this case, hence omitted.
The survey of the aforesaid provisions of the Act provides formation
and registration of the co-operative society. The membership of the society,
the general body, the committees to manage the affairs of the society, their
tenure and qualifications have been provided for and the management of
the society shall vest with the committee and the committee is empowered
to elect the officers, namely, the President, two Vice-Presidents etc. etc.
and the representatives to represent its membership in other societies.
The undisputed facts are that on June 5, 1984, the District CoF
G
'"
operative Central bank (for short the "Central Bank") had sent their 45
delegates to the M.P. State Co-operative Bank Ltd. (for short, the 'Apex
Bank'). On August 24, 1984, the first meeting of the Board of Directors of
the Apex Rank was held and from that date its term of office of three years H
724
SUPREME COURT REPORTS [1997] SUPP.1 S.C.R.
A
started running. The President and Vice-President, and other office
bearers from the Board of Directors came to be elected, resulting in
constitution of the Board of Directors and the Managing Committee of the
Apex Bank. The term of the representatives of the Central Bank (Board
of Directors) and of their office bearers was co-terminus with the term of
B the Managing Committee of the Central Bank. Equally, the term of the
Board of Directors and of the Managing Committee of the Apex Bank was
co-terminus, i.e., three years which was later amended as five years as per
bye-law 41(1). Admittediy, three-tier system of Co-operative Societies
exists in the State of Madhya Pradesh with the village level Primary
Co-operative Credit Societies (for short "Primary Societies"); the District
C Co- operative Central Banks (for short, the 'Central Banks'); and the Apex
Bank. The term of all the Societies, Central Banks and Apex Bank was
extended for period ranging from one year to the maximum of 1-1/2 years,
by operation of the amendment brought to the M.P. Co-orierative Societies
Act, 1960 (for short, "the Act"), till April 30, 1990. By Resolution dated
D April 26, 1990, the Apex Bank applied to the Registrar to hold elections.
Since that was not being done, Offic:ers and Managing Committees filed
M.P. No. 908/90 in the High Court which directed that elections be
conducted in accordance with the procedure prescribed under the law. On
the even date, the Ordinance No. 2 of 1990 replaced by Act (14 of 1990)
was passed by the State Legislature terminating the term of the
E Committees; the Registrar was directed to take over management of all the
Primary Societies, Central Banks and of the Apex Bank. As a consequence,
the Committees of all the Societies were superseded by proceedings dated
April 26, 1990. Consequently, they again filed writ petition bearing M.P.
No. 1111/90. The High Court by its judgment date June 2 1, 1993 reported
F
as A.P. Sastri & Others v. State of Madhya Pradesh, (1993) 2 M.P.J.R. 33,
declared the Amendment Act (14 of 1990) amending Section 49(8) of the
M.P. Co-operative Societies Act, 1960 (for short, the 'Act') as ultra vires
the legislative power. The Division Bench declared as under :
G
H
"Indeed the factual situation is that the petitioner Societies had
passed resolution and requested the respondent Registrar to
appoint the Returning Officer for holding new elections. In a
situation like this, the real question is whether the Registrar by not
performing his obligations under the Act and not holding election
before the expiry of the term of the existing committee, can be
permitted to be benefited by his own default. If the matter is
"
. .
·•
R.P. YADAVv. STATE[K.RAMASWAMY,J.)
725
considered in the context of default of the Registrar on the A
Returning Officer appointed by him, and the decision is required
to be taken in the context of democratic destiny and the rights of
the members to manage the Society, the provision would appear,
prima facie, unreasonable and arbitrary.
In view of the discussions aforesaid, these petitions succeed B
and are allowed by quashing Section 48( 4) and Section 49(8) of
the Act, as amended by M.P. Act No. 14/90. As a necessary
consequence, provisions in these sections existing immediately
before the aforesaid amendment would be deemed to be continuing legally and validly. As a necessary consequence, the officers of C
the earlier Managing Committee of the petitioners Societies will
continue to function, till elections are heid, in accordance with
law."
While the writ petitioners were pending, the office bearers continued
to hold office. Subsequently, the present writ petition come to be filed D
seeking writ of quo wa"anto to show cause under which authority the
appellants were functioning. In the meanwhile, Section 49(8) was amended
which reads as under;
"49(8)(i) It shall be obligatory on the outgoing committee of the E
Society to hold . elections prior to the expiration of the term
under sub-section (7-A) or extended term under sub-section
(7-AA). The outgoing committee shall apply to the Registrar
for holding election within a reasonable time which shall not be
in any case less than ninety days before expiration of the term
of the committee :
F
•
Provided that if the outgoing committee has resolved and
requested the Registrar to hold election at least ninety days in
advance and the Registrar has failed to conduct elections on its
request, the Registrar shall not assume charge of the committee G
and the members of the committee shall continue to holci the
offices :
Provided further, that if the Registrar fails to conduct elections
of the committee within ninety days from the date of expiry of the
term of the committee, the committee of the Society shall appoint H
726
A
B
SUPREME COURT REPORTS [1997] SUPP. 1 S.C.R.
returning officer who shall conduct the election of the committee
within 180 days from the date of the expiry of the term.
(ii) If the committee fails to hold election and has not handed over
the charge on expiration of the term, under sub- section (7-A) or
extended term under sub-section (7-AA) to the Registrar or any
officer authorised by him on his behalf, all the members of the
committee shall be deemed to have vacated their seats and the
Registrar shall assume charge and hold election as early as possible."
C
The amendment Act (12 of 1994) came into effect from May 8 1994.
The High Court disposed of the writ petition on the findings that the
appellants deliberately delayed conduct of the elections and that they had
no right to continue in office after the expiry of the term. The Writ Petition
Nos. 4126/96, 4473/96, 60/97 and 83/97 were disposed of in the light of these
D directions. The interim orders and by orders Writ Petition Nos. 2924 and ,
3342/96 were disposed of as having become infructuous; other writ
petitions also have been disposed of with the same observations. Thus, this
appeal.
In the counter-affidavit filed in this Court, it has been admitted as
E under:
F
G
"Before the term of the elected body of the respondents Society
could expire a notification was issued by the state Government
under Section 49(7)(AA) of the M.P. Co-operative Societies Act
1960 for short the 'Act', extending the term of the society till
31.12.1989. A copy of this notification: is filed herewith as Annexure
R-1.
A second notification was issued by the state Government on
30.12.1989 extending the term till 30.4.1990. Annexure R-2.
The State Government issued an ordinance dated 26.4.90 &
also issued a notification to the effect that the term of all the
Societies shall expire on 28.4.90. The notification relating to the
answering respondents is filed herewith and marked as Annexure
H
R-3.
-'
' .
R.P. YADAVv. STATE[K.RAMASWAMY,J.)
727
That consequent to the notification dated 26.4 the Registrar A
took over the charge of the Respondent No. 3 Society on 28.4.90
itself.
On 4.5.90 this Hon'ble Court vide interim orders directed that
the old committees which were incharge of the Societies as on
28.4.90 shall continue to remain incharge.
B
On 5.5.90 the elected committees again took over charge as
per the interim orders of the Hon'ble High Court.
That the state Government enacted M.P. Act No. 14 of 1990
by way of which the previously notified ordinance was duty incorC
porated in the Act vide notification dated 31.7.90.
That in view of the Act No. 14 of 1990 charge was again taken
over by the Registrar w.e.f. 1.8.90.
However, it is pertinent to note that the Co-operative set up in D
the state of M.P. is three tier set up i.e. Primary Society at the village
level, Central Society at the district level and apex Society at the state
level. The representatives elected by the Primary Society from the
electoral college for the central Societies along with some other
representatives and the representatives elected by the central Societies E
.from electoral college for apex Societies. Thus, in view of the
aforesaid set up until and unless the elections of representatives at
the Primary Society level are not complete the electoral college for
the central Society is not complete and therefore elections of the
central Society level can only be held after the elections for representatives of the Primary Society I which are complete. Similar is F
the position as regard the apex Society i.e. elections in apex Society
cannot take place until unless the elections of representatives at the
central Society level is not complete, and the electoral college so
fom1ed is not complete."
(emphasis supplied) G
In para 4 of the judgment, the learned Judges have noted as under :
"The election Process which had started in 1988 came to halt till
1993 when the general elections were ordered. In December 1993,
new Government took over and the elections for Panchayats were H
A
B
c
D
E
F
728
SUPREME COURT REPORTS [1997] SUPP. 1 S.C.R.
held in May-June, 1994. It is alleged that by Act No. 12/94, which
came into effect from 8.5.1994, certain provisions of the Act of
1960 were amended and sub-section (7-A) and sub-section (8) of
Section 49 were also amended. It is then alleged that elections to
the Municipal Corporations were ordered in 1994-95. It is further
alleged that on 22nd July, 1995 rules were amended and they were
notified. Then on 16th August, 1995, elections for 24 thousand
Primary Societies were conducted. Thereafter, elections for other
than agricultural societies, about 6000 in number, were conducted
in March 1996. It is alleged that elections to other societies were
postponed because of the monsoon. Then ii is pointed out that on
16th September 1996, election process for Marketing Societies started
and was completed on 16th Oct. 1996. It is further pointed out that
on 13th September 1996, elections for District Co-operative Central
Banks started. The elections at the district level are likely to be over
by 5th Febmary 1997."
(emphasis supplied)
There is no doubt that in our democratic policy, all democratic
institutions including the Co-operative Societies governed by the provisions
of the Act, are required to be organised on the principles of democratic
governance. In fact, Part IX of the Constitution, brought by Constitution
(Sixty-third Amendment) Act 1992, provides for the Panchayat system
within the democratic governance by requiring holding of periodical elections right from the bottom-most democratic set up of the village panchayat
upto the District Board. The elections, therefore, to the Co-operative
Societies are also required to be conducted periodically before the expiry
of the term of the Managing Committee of the Societies so that the elected
body would remain in office and organise the management of the Society
and disburse loans to the agriculturists for their. economic and social
empowerment and to augment their economic resources for self-sufficiency
and to give a boost to the national productivity in agricultural produce. The
conduct of the periodical elections is required to be organised in accordG ance with the provisions of the Act, Rules and bye-laws of each Society.
The question, therefore, is : whether the Registrar was justified under
Section 49(8)(ii) of the Act to assume charge of the Apex Bank? Section
2( d) of the Act defines 'Committee' to mean the Board of a management,
by whatever name called, constituted under Section 48. The 'Registrar'
H
defined under Section 2(x) of the Act shall be the Registrar of
R.P. YADAVv. STATE[K.RAMASWAMY,J.]
7'19
Co-operative Societies and under Section 3, the State Government is A
empowered to appoint a person to be the Registrar and may appoint one
or more officers of the enumerated categories to assist him, for the
performance of all the functions and duties under the Act. Section 48 in
Chapter V deals with management of the Societies. It provides that the
final authority in a Society shall vest in the general body of the members. B
The management of every Society, by operation of sub-section (2), shall
vest in a committee constituted in accordance with the Act or Rules made
· thereunder or bye-laws of the Society. It shall exercise such powers and
perform such duties as may be conferred or imposed respectively by the
Act or Rules made thereunder or bye-laws of the Society. Sub-section (1)
of Section 48-B posits that "every committee of Society shall, at the time of C
election of Chainnan or Vice-Chainnan, also elect representative who shall
represent it in other Societies and the representative so elected shall not be
withdrawn by the Committee till the next election of the Committee."
(emphasis supplied) Section 48-C prescribes the powers of the Committee
and under clause (b) thereof, the Board of the Committee of a Society D
shall, in accordance with the bye-laws, have power to elect the Chairman
and other office bearers. Sub-section (1) of Section 49 envisages "Annual
General Meeting" and provides that every Society shall, within a period of
twelve months from the date of last annual general meeting, call a general
meeting of its members for the purposes specified in clauses (a) to (f) of
sub-section (1) thereof. Section 49(b) says that the purpose of annual E
general meeting is "electiOn, if f alien due of the members of the Committee."
Explanation to Section 49(1)(b) envisages that "Election of the Committee
shall be deemed to have fallen due, if the term of the Committee comes
to an end within a period of three months from the date of the annual
general meeting". Sub- section (6) of Section 49 envisages that "(I)f the
F
bye-laws of the Society provide for election of all or some members of the
Committee on territorial basis under sub-section (7) thereof, such members
of the Committee shall be elected from the area in a meeting of the members
of that area in accordance with the provisions of the bye-laws on a date prior
to that general meeting." Sub-section (7-A) provides that "the term of the
committee shall be five years from the date on which first meeting of the G
Committee is held." The proviso is not relevant; hence omitted. Clause (ii)
of sub-section (7-A) envisages that "the tenn of the representative elected by
the Committee of the Society shall be co-tenninus with the tenn of the
Committee of the Society for which representative is elected." However, the
proviso thereto provides that "the representative of a Committee shall continue H
730
SUPREME COURT REPORTS [1997] SUPP. 1 S.C.R.
· A to hold his office till the expiry of the tenn of the Committee of which he is
a member." (emphasis supplied) Sub-section (7-AA) of Section 49 provides
that the State Government may, by notification, for reasons to be stated
therein, extend the term of the Committee of a Society or a class of
Societies from time to time for a total period not exceeding twelve months.
B Sub-section (7-AAA) of Section 49 envisages that" notwithstanding the
expiry of the maximum period of eighteen months specified in sub-section
(7-AA), in respect of the committees between the period commencing on
the 7th May, 1988 (hereinafter referred to as the said date) and ending on
the date of publication of the Madhya Pradesh Co- operative Societies
(Amendment) Ordinance, 1988, in Gazette the period in respect of such
C Committees shall be deemed to have been extended for a period of six
months with effect from the said date as if the notification for the extension
of the period were issued under sub-section (7-AA) on the said date".
Sub-section (8) has already been extracted and needs no repetition.
D
A conjoint reading of the above-referred provisions would manifest
the legislative intention that it shall be obligatory on the outgoing
Committee of the Society to hold elections prior to the expiry of the term
under sub-section (7-A) or before the expiry of the extended time under
sub-section (7-AA). The outgoing committee shall apply to the Registrar
to hold elections within a reasonable time "which shall not be in any case
E less than ninety days before the expiry of the tenn of the Committee."
(emphasis supplied) Thus, it could be seen that it is the duty of the
outgoing Managing Committee of the Society to have its elections held
prior to the expiration of the term of the Committee not less than ninety
days before expiry of the term of the Committee.
F
G
Under the first proviso, if the outgoing committee had resolved and
requested the Registrar to hold elections and the Registrar had failed to
conduct elections on its request, there is a legislative injunction issued
against the Registrar that "he shall not assume charge of the Committee
and the members of the Committee shall continue to hold the office".
U oder the second proviso, if the Registrar fails to conduct elections of the
committee within ninety days from the date of the expiry of the term of the
committee the committee of the Society shall appoint returning officer who
shall conduct the election of the committee within 180 days from the date
of expiry of the term. The combined operation of sub-section (8)(i) and
H the second proviso is that though the members of the committee are
R.P. YADAVv. STATE [K. RAMASWAMY,J.)
731
entitled, by operation of the first proviso, to continue to hold the office, it A
~.
is equally obligatory on the part of the committee that, if the Registrar fails
to conduct elections as envisaged hereinbefore, the returning officer should
be appointed whose duty shall be to conduct elections of the committee
within 180 days before the date of the expiry of the term. By operation of
sub-section .(8)(ii) if the members of the Committee having continued to B
hold office by operation of the first proviso to sub-section (8)(i), fails to
appoint a returning officer under the second proviso and, if the committee
thereby, commits default to hold elections and does not hand over the
charge, on expiry of the term under sub-section (7-A) or extended term
under sub-section (7-AA) to the Registrar or any officer authorised by him
on his behalf, they all shall be deemed to have vacated their seats and the c
Registrar shall assume charge and hold elections as early as possible. Thus
->
the combined reading of the sections envisages that elections to the
Managing Committee shall be held by the Registrar, at the request by the
Committee, before expiry of the term of the outgoing committee within the
time schedule prescribed therein. If the Registrar fails to perform the said D
duty, the Managing Committee, while remaining in office, is enjoined to
have the elections conducted within 180 days or at least not less than 90
days before the expiry of the term of the Managing Committee. But if the
committee commits default in conducting the elections, the members of the
committee are deemed to have vacated their seats. Thereby, by statutory
operation, no Managing committee remains in office. The Registrar, E
therefore, should assume charge of the Society. On assumption thereof,
while conducting the business of the Society simultaneously he should hold
elections as expeditiously as possible so that the Managing Committee
......__,.
elected on democratic principle immediately assumes office and conducts
the business of the Society in the manner laid down under the Act, Rules F
and the bye-laws of the Society and achieves the object of the Society and
realises the collective aspiration of the members of the Society.
In response to our request, the learned counsel for the State of
Madhya Pradesh, has supplied to us the Hindi as well as the relevant
translated English version of the bye-laws of the Apex bank as amended G
till 5th May, 1997. Initially, we were provided with a copy of the
·~
unamended bye-laws. On comparative consideration, we find that major
changes have been made in the amended bye-laws supplied by learned
counsel for the Government.
H
732
SUPREME COURT REPORTS [1997] SUPP.