Civil Writ Petition No.19370 of 2010 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Date of Decision:-15.3.2011 Vimal Jain and S.K.Mittal ...Petitioners Versus Financial Commissioner (Cooperation) Punjab and others ...Respondents CORAM: HON'BLE MR.JUSTICE MEHINDER SINGH SULLAR Present:- Mr.M.S.Kang, Advocate for the petitioners. Mr.Sartaj Singh Gill, Deputy Advocate General, Punjab for respondent Nos.1 to 4. Mr.Yogesh Goel, Advocate for respondent Nos.5 to 9, 11 & 12. Mr.G.C.Shahpuri, Advocate for respondent No.10. M ehinder S ingh S ullar , J. (Oral) Concisely, the relevant facts, which need a necessary mention for the limited purpose of deciding the core controversy, involved in the instant writ petition and emanating from the record, are that Baldev Kumar Aggarwal is the President and Amrit Lal Aggarwal, Jaspal Singh, Prem Gupta, Varinder Kumar Singla, Sunil Goel & Sukhjiwan Rai (respondent Nos.5 to 11) are the members of The Ludhiana Aggarwala Cooperative House Building Society Limited (respondent No.12) (for brevity “Society”), governed by the provisions of The Punjab Cooperative Societies Act, 1961 (hereinafter to be referred as “the Act”), in order to achieve its following objects:- i) To purchase, take on long lease or acquire by exchange or otherwise land for construction of houses or housing colonies. ii) To construct, hire or to acquire buildings for the individual and collective benefit of the members. iii)To sell or to exchange house sites with members, rent out or lease buildings for common use, surrender or accept surrender of houses or house sites. iv)To purchase or to sell to members requisite material for Civil Writ Petition No.19370 of 2010 2 construction or repair of houses. v) To establish and carry on sanitary, social, educational and recreational activities for the benefits of members. vi)To raise funds, and to give loans to members for the construction of houses by themselves or on their behalf. vii)To prescribe house plans. viii)To undertake measures to spread knowledge of cooperative principles and practices. 2. The petitioners and others made a complaint (Annexure P1) to the Registrar, Cooperative Societies against the Managing Committee for mis- utilization of funds of Tagore Public School (for short “school”) on the ground that its office bearers are trying to start a college/school at village Birmi and have withdrawn approximately ` 60 lacs from the school bank account for development of school/college against the rules, Act and bye-laws of the society without approval of the general body. According to the petitioners that such power of opening new school vests with the society and not with the Managing Committee. On the basis of aforesaid allegations in the complaint, the petitioners sought appropriate action against the society in this regard. 3. In the wake of complaint (Annexure P1), the Registrar issued notice and the President submitted the reply (Annexure P3) on behalf of the society, inter-alia pleading that the society is already running the Tagore Public school at Aggar Nagar, Ludhiana. The Managing Committee of the society nominated an Executive Committee of the school, consisting of all its seven elected members, two parents members, three educationist members, principal, two teachers and DEO i.e. 16 members, as per bye-laws. All the powers vest with the Executive Committee to run the affairs of the school. It was denied that the Managing Committee is trying to start a college, but it approved to start a branch of the school at village Birmi. According to the society, as per Annexures 1, 2 and 3 (attached with the reply), the complainants were signatories and they approved the resolutions passed in the meeting of the Executive Committee held on 16.3.2009, Civil Writ Petition No.19370 of 2010 3 10.4.2009 and 14.6.2009 to start the school and renovation of the building. The resolution No.5 dated 31.7.2009 to start a branch of the school was approved by the Managing Committee of the society, in which, the petitioners, Sunil Kumar and Sukhjiwan Rai Members were present. The proceedings of the meeting were subsequently confirmed in the next meeting dated 18.12.2009 of the Managing Committee, in which, they (complainants) were also present and confirmed the proceedings by them. The agenda item to start the college was not approved by the majority members present in the meeting held on 2.8.2009 and it was deferred. In all, the Managing Committee claimed that only it decided to start a branch of the school at village Birmi and the expenses approximately of ` 18 lacs were approved in this regard. It will not be out of place to mention here that the Managing Committee stoutly denied all other allegations contained in the complaint (Annexure P1) and prayed for its dismissal. 4. After taking into consideration the entire material on record, the Additional Registrar directed to call a general body meeting of the society to consider the matter of re-opening of new branch of the school, by virtue of impugned order (Annexure P5). 5. Although the Additional Registrar has only directed to convene the meeting of the general body to consider the entire matter, but the petitioners still did not feel satisfied and preferred the instant writ petition, challenging the impugned order (Annexure P5), invoking the provisions of Articles 226 and 227 of the Constitution of India. That is how, I am seized of the matter. 6. Having heard the learned counsel for the parties, having gone through the record and legal provisions with their valuable assistance and after bestowal of thoughts over the entire matter, to my mind, there is no merit in the instant writ petition in this context. 7. As is evident from the record, that almost all the allegations contained in the complaint (Annexure P1) filed by the petitioners and other Civil Writ Petition No.19370 of 2010 4 complainants were found to be false, except that the Executive Committee passed a resolution to open a new branch of the school, being run by the society, in village Birmi and the expenditure of about ` 18 lacs was approved in this connection. As this resolution of Executive Committee was not approved by the general body, therefore, the Additional Registrar rightly directed to immediately call the general body meeting to consider the entire matter of opening a new branch of the school, by means of impugned order (Annexure P5), the operative part of which is as under:- “Though executive Committee passed a resolution to run the School at Birmi on 31.7.09 but the agenda was not passed by the General Body Meeting held on 2.8.09 only two days after the executive committee meeting. Management should not have initiated the opening of new school premises at Birmi in the face of non approval of the agenda in the General House. Since it is the General Body Meeting and not the executive committee of the society which is supreme, the society may be directed to immediately call general body meeting of the society and get all the issues of the opening of school, expenditure already incurred on the opening of the new school and further course of action to run the school at Birmi approved from the General House. DRCS Ludhiana needs to be directed for immediate compliance of calling general body meeting of the society and transfer of land in the name of Cooperative House Building Society Ludhiana from Educational Societies registered under Registrar Firms and Societies 1860.” 8. Ex facie, the argument of the learned counsel for the petitioners that as the Additional Registrar did not have the power/jurisdiction to direct to call the general body meeting of the society and he ought to have taken action under sections 27 and 54 of the Act, therefore, the impugned order (Annexure P5) is illegal, is not only devoid of merit but misplaced as well. 9. As is clear that section 50 of the Act postulates that “the Registrar may of its own motion or on the application of a majority of the committee or of not less than one-third of the members hold an inquiry or direct some person authorized by him by order in writing in this behalf to hold an inquiry into the Civil Writ Petition No.19370 of 2010 5 constitution, working and financial condition of a co-operative society.” 10. Likewise, sub-section (2) of this section posits that the Registrar or the person authorized by him under sub-section (1) shall have the following powers, namely:- (a) xxx xxx xxx (b) he may, notwithstanding any rule or bye-law specifying the notice for a general meting of the society, require the officers of the society to call a general meeting at such time and place at head-quarters of the society to consider such matters, as may be directed by him, and where the officers of the society refuse or fail to call, such a meeting he shall have power to call it himself. 11. Similarly, sub-section (3) further envisages that any meeting called under clause (b) of sub-section (2) shall have all the powers of a general meeting called under bye-laws of the society and its proceedings shall be regulated by such bye-laws. 12. A conjoint reading of these provisions would reveal that as the Registrar or any person authorized by him has the ample power/jurisdiction, notwithstanding any rule or bye-laws, require the officers of the society to call a general meeting, therefore, the contrary arguments of the learned counsel for petitioners “stricto sensu” deserve to be and are hereby repelled under the present set of circumstances. 13. Sequelly, the provisions of section 27, which deal with the removal or suspension of committee or member thereof and section 54 of the Act, which regulates the provisions of surcharge or payment contrary to the Act, are not at all applicable to the instant controversy, which is squarely covered and falls within the ambit of section 50, in the manner depicted hereinabove. 14. This matter can be viewed from a different angle. The Additional Registrar has only directed to call the meeting and get all the indicated issues of opening the new branch of the school settled by the general body and nothing adverse was decided against the petitioners, by way of impugned order (Annexure Civil Writ Petition No.19370 of 2010 6 P5). They are at liberty to participate in the meeting and express their views. Such order containing valid reasons, cannot possibly be interfered with, while exercising the extraordinary writ jurisdiction of this Court, unless and until, the same is perverse and without jurisdiction. Since no such patent illegality or legal infirmity has been pointed out by the learned counsel for the petitioners, so, the impugned order deserves to be and is hereby maintained in the obtaining circumstances of the case. 15. No other legal point, worth consideration, has either been urged or pressed by the learned counsel for the parties. 16. In the light of the aforesaid reasons, as there is no merit, therefore, the instant writ petition is hereby dismissed as such. (Mehinder Singh Sullar) 15.3.2011 Judge AS Whether to be referred to reporter?Yes/No