bsb IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL CIVIL CIVIL APPELLATE JURISDICTION APPELLATE JURISDICTION APPELLATE JURISDICTION WRIT WRIT WRIT PETITION NO. 6998 OF 2008 PETITION NO. 6998 OF 2008 PETITION NO. 6998 OF 2008 Shri Laxmikant Mohanlal Khabia ... Petitioner v/s Shri Subhash Gurappa Jeur & ors. ... Respondents ALONGWITH ALONGWITH ALONGWITH WRIT WRIT WRIT PETITION NO. 7006 OF 2008 PETITION NO. 7006 OF 2008 PETITION NO. 7006 OF 2008 Shri Subhashchandra R. Limaye & anr. ... Petitioners v/s Shri Subhash Gurappa Jeur & ors. ... Respondents Mr.N.R.Bubna for the petitioner in W.P.No.7006 of 2008. Mr.R.S.Apte for the petitioner in W.P.No.6998 of 2008. Mr.Girish Godbole i/by Ms.Jai V. Kanade for respondent Nos.1 and 2 in both petitions. Mr.S.D.Rayrikar, A.G.P. for Respondent Nos.5 and 6 in both petitions. CORAM: CORAM: CORAM: SMT.NISHITA MHATRE, J. SMT.NISHITA MHATRE, J. SMT.NISHITA MHATRE, J. DATED: DATED: DATED: 16TH OCTOBER, 2008 16TH OCTOBER, 2008 16TH OCTOBER, 2008 P.C. P.C. P.C.: 1. Both these petitions are filed against the acceptance of nominations of respondent Nos.1 and 2 by the appellate authority i.e. the Additional Registrar (Inspection & Election) with regard to the elections to 2 be held to the Managing Committee of the Rupee Co-operative Bank Ltd. The Additional Registrar has found that the nominations filled in by both respondent Nos.1 and 2 were valid and, therefore, they have been permitted to participate in the election process which will be held on 19.10.2008. 2. The main contentions raised by the learned counsel appearing for the petitioners in both the petitions are as follows:- (i) That, both the respondent Nos.1 and 2 are "tainted" and are, therefore, disqualified for contesting the elections as an enquiry has been conducted against them under Sections 79 and 83 and the responsibility has been fixed on these respondents under those sections. Consequently, an enquiry under Section 88 is also in progress and, therefore, the respondent Nos.1 and 2 cannot contest the elections. (ii) That, respondent Nos.1 and 2 had submitted undertakings on 8.12.2002 to the Chief Minister who was also holding the charge of Minister for Cooperation, that they would not contest the elections to the Managing Committee of the respondent Bank. 3 (iii) That, since the Reserve Bank of India can sanction the winding of, construction, supersession of a committee, etc. under Section 110A of the Maharashtra Co-operative Societies Act, any directive from the Reserve Bank of India must be given due weightage by the respondent Bank. It is submitted that, the Reserve Bank of India has written letters to the Commissioner for Cooperation and Registrar, Co-operative Societies, indicating that the ex-Directors of the Rupee Co-operative Bank Ltd. are "tainted" with enquiries pending against them and, therefore, steps should be taken to ensure that they do not contest the elections. It is further contended that the body was superseded and an administrator was appointed. Elections have to be held now after several years and, therefore, this letter of the Reserve Bank of India should be construed as a lesser punishment which can always be imposed on the respondents. 3. On the other hand, it has been argued on behalf of respondent Nos.1 and 2 that the petitioners do not belong to the constituency of the weaker section and, therefore, they cannot file the present writ petition against respondent No.1 who is a candidate from that constituency. It is further submitted that Section 152A of the M.C.S. Act contemplates an appeal only against 4 the rejection of a nomination. It is submitted that a writ petition, therefore, cannot be filed once a nomination paper has been accepted by the Additional Registrar. It is then contended that the election process has been started and, therefore, an election petition would be the proper remedy for the petitioners. Reliance is placed on the judgment in the case of Shri Shri Shri Sant Sant Sant Sadguru Janardan Swami (Moingiri Maharaj) Sahakari Sadguru Janardan Swami (Moingiri Maharaj) Sahakari Sadguru Janardan Swami (Moingiri Maharaj) Sahakari Dugdha Dugdha Dugdha Utpadak Sanstha & anr. v/s State of Maharashtra Utpadak Sanstha & anr. v/s State of Maharashtra Utpadak Sanstha & anr. v/s State of Maharashtra & ors., reported in (2001) 8 SCC 509. ors., reported in (2001) 8 SCC 509. ors., reported in (2001) 8 SCC 509. It is then submitted that the provisions of Section 73FF of the M.C.S.Act in which the disqualifications of the membership are stipulated, must be strictly construed having regard to the nature of the right which could be denied to a person wanting to contest the elections. Reliance is also placed on the judgment in the case of Murlidhar Murlidhar Murlidhar Bhaulal Malu v/s Sudhakar Honaji Patil & anr., Bhaulal Malu v/s Sudhakar Honaji Patil & anr., Bhaulal Malu v/s Sudhakar Honaji Patil & anr., reported reported reported in 1987 (3) Bom.C.R. 550. in 1987 (3) Bom.C.R. 550. in 1987 (3) Bom.C.R. 550. The learned counsel for the respondent Nos.1 and 2 also submits that the petitioner ought to have joined the other validly nominated candidates to the petitions and not having done so, the petitions must fail. 4. Before proceeding to deal with the petitions on merit, I may first consider the preliminary issues raised on behalf of respondent Nos.1 and 2. 5 5. The first contention is that since, the petitioners do not belong to the weaker section, they cannot challenge the nomination filed by the 1st respondent. In my opinion, this submission cannot be accepted because though a candidate contests from the constituency for the weaker section, all members of the Society are entitled to vote for all candidates in the fray including those contesting from a particular constituency. The persons voting for electing a member from that constituency are not confined only to the weaker section and, therefore, this submission of the learned counsel for the respondent Nos.1 and 2 cannot be accepted. 6. The next submission is that, all validly nominated candidates ought to have been joined as party respondents. It is a valid objection raised in view of the judgment of two different benches of this Court i.e. in Writ Petition No.2614 of 1982 and another in L.P.A. No.142 of 1006. All the validly nominated candidates were parties to the appeal proceedings and, therefore, in my opinion, ought to have been joined to this petition. The petitions must fail on this ground alone. 7. The next submission regarding the maintainability of 6 the petition was with regard to the fact that the election process is already underway and that in view of the well settled position in law, there should be no interference with the election process once it has started. In the case of Shri Sant Sadguru Janardan Shri Sant Sadguru Janardan Shri Sant Sadguru Janardan Swami Swami Swami (supra), the Supreme Court while considering the election to a co-operative society, has held that the consistent view is that the election process once commenced should not be stopped for any reason since it is possible for an aggrieved candidate to challenge the election results of a winning candidate by filing an election petition. In my opinion, the petition must be dismissed on this count also. The elections are to be held on 19.10.2008 and, therefore, in my opinion, no relief can be given to the petitioners in these petitions at this stage. The petitioners may challenge the elections’ results in the event they are aggrieved by the same, if they are entitled to do so under law. However, the petitioners cannot pre-empt the holding of the elections on 19.10.2008 and on this ground itself the petitions must be rejected. 8. It is then submitted by the learned advocate for the petitioners that under Section 73FF, the respondents have earned a disqualification in view of the provisions of Section 73FF(1)(iii). This section reads as under: 7 "Section Section Section 73FF(1)(iii):- 73FF(1)(iii):- 73FF(1)(iii):- (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 a committee, no person shall be eligible for being appointed, nominated, elected, co-opted or, for being a member of a committee, if he- (i) .............. (ii) .............. (iii) has been held responsible under Section 79 or 88 or has been held responsible for payment of costs of inquiry under Section 85." Section Section Section 79 79 79 deals with the Registrar’s power to enforce performance of obligations. Section Section Section 88 88 88 empowers the Registrar to access damages against delinquent promoters, etc. Section 88 reads thus:- "Section "Section "Section 88:- 88:- 88:- (1) Where, in the course of or as a result of an audit under section 81 or an inquiry under section 83 or an inspection under section 84 or the winding up of a society, the Registrar is satisfied on the basis of the report made by the auditor or the person authorised to make inquiry under section 83 or the Liquidator under section 105 or otherwise that any person who has taken any part in the organisation or management of the society or any deceased, or past or present officer of the society has, within a period of five years prior to (the date of commencement of such audit or date of order for inquiry, inspection or) winding up, misapplied or retained, or become liable or accountable for, any money or property of the society or has been guilty of misfeasance or breach of trust in relation to the society, the Registrar or a person authorised by him in that behalf may frame charges against such person or persons, and after giving a reasonable opportunity to the person concerned and in the case of a deceased person to his representative who inherits his estate, to answer the charges, make an order requiring him to repay or restore the money or the property or any part thereof, with interest 8 at such rate as the Registrar or the person authorised under this section may determine, or to contribute such sum to the assets of the society by way of compensation in regard to the misapplication, retention, misfeasance or breach of trust, as he may determine. (2) The Registrar or the person authorised under sub-section (1) on making any order under this section, may provide therein for the payment of the cost or any part thereof, as he thinks just and he may direct that such costs or any part thereof shall be recovered from the person against whom the order has been issued. (3) This section shall apply, notwithstanding that the act is one for which the person concerned may be criminally responsible." A perusal of Section 81 indicates that an audit is to be conducted at least once a year in each co-operative society by a person authorised. Under Section 83, an enquiry can be conducted by the Registrar on his own motion or on an application of the 1/3 members of the Society into the working and financial condition of the society. Once the Registrar finds, after a preliminary enquiry, that there has been some misfeasance or breach of trust in relation to the society, he or a person authorised by him in that behalf may frame charges against the delinquent person. In the present case, the enquiry has not been completed. Therefore, there is yet to be a determination of the liability/ responsibility/ guilt. Therefore, in my opinion, Section 88 would not come into play at all in the facts and circumstances of 9 the present case. Consequently, there is no disqualification by virtue of an enquiry which may be pending under Section 88 unless the responsibility has been fixed. In my opinion, the contentions raised on merits by the petitioners are unfounded. 9. It is submitted on behalf of the petitioners that the enquiry contemplated under Section 88 is to be conducted in two stages. However, this submission is not borne out by a plain reading of the section. Even assuming an inquiry under Section 88 is to be considered in two stages, unless both the stages are complete, a candidate would not earn the disqualification under Section 73FF(1)(iii) of the Act. 10. As regards the undertaking given by the respondent Nos.1 and 2, in my opinion, this undertaking would not disentitle respondent Nos.1 and 2 from contesting the election. The undertaking has been given in 2001. The letter of the petitioners which includes the undertaking, requests the Chief Minister to ensure that the elections to the Managing Committee of the respondent No.4 Bank are held at the earliest and that they would not contest the elections when held. A proper construction of the letter is that what the respondent Nos.1 and 2 intended was that if the 10 elections were held immediately or soon after the undertaking was given, they would not contest the elections. Seven years have elapsed since they tendered the undertaking and, therefore, in my opinion, it would not bind them in perpetuity, assuming no elections were held during this period. 11. Hence, the petitions are dismissed.