THE HON'BLE SRI JUSTICE NOUSHAD ALI WRIT PETITION No.20899 of 2011 BETWEEN: D.V.V. Gopala Raju …. PETITIONER And 1. The State of Andhra Pradesh, rep. by its Secretary, Agriculture and Cooperative (COOP.1) Department, Secretariat, Hyderabad, and others. …. RESPONDENTS Counsel for petitioners: M/s. Bharadwaj Associates Counsel for respondents 1 & 2: G.P. for Cooperation Counsel for respondent No.3: Sri M. Papa Reddy The Court made the following order: ORDER: The 3rd Respondent is a cooperative society incorporated under the A.P. Cooperative Societies Act, 1964. The petitioner is the former chairman of the Managing Committee of the said society, whose term expired on 02-12-2010. He is challenging the order of the State Government, 1st Respondent herein, issued in G.O.Rt.No.812, Agriculture & Cooperation (Coop.I) Department, dated 15-07-2011, appointing a person-in-charge committee consisting of officials to manage the affairs of the society. 2. On the eve of the expiry of the term of the managing committee, the 3rd respondent-society and the District Cooperative Market Societies, a proposal was mooted by the Commissioner for Cooperation, 2nd respondent herein and the Registrar of the Cooperative Society to exempt the said Societies from holding elections to the Managing Committees with a view to re-structuring the marketing set up in the State. The State Government, accepting the proposal in exercise of its powers under Section 123 of the Act, issued orders in G.O.Rt.No.1624, dated 16-11-2010 exempting the 3rd Respondent-society from holding elections for a period of six months and enabled the Registrar to appoint the existing committee members as person-in-charge committee under Section 32 (7) of the Act. 3. In pursuance of the said orders of the State Government, the Registrar exercising powers under Section 32 (7) (a) (i) issued orders Rc.No.25826/2010/PE, dated 30-11-2010 appointing the existing members as persons-in-charge committee for a period of six months or till the holding of elections whichever was earlier. Thus, the members of the Managing Committee who were originally elected along with other official/nominated members continued to manage the affairs of the 3rd respondent-society with the petitioner as its Chairman. The term stipulated in the proceedings of the Registrar dated 30-11-2010 expired on 01-06-2011. 4. As elections were not held even during the extended term, the 2nd Respondent sent a proposal to the State Government vide letter Rc.No.25826/2010-PE, dated 18-05-2011 requesting the Government to extend the term of the existing persons-in-charge committee for a further period of six months beyond 01-06-2011. The State Government did not pass orders on the said proposal and in the meanwhile the term of the persons-in-charge committee expired on 01- 06-2011. The 2nd respondent, therefore, sent another proposal vide Rc.No.25826/2010-PE, dated 04.06.2011 for appointing of an official persons-in-charge committee. Thereupon, the State Government issued the impugned G.O.Rt.No.812, dated 15-07-2011 appointing the official persons-in-charge committee. 5. Heard Sri Vedula Venkataramana, learned Senior Counsel instructed by M/s.Bharadwaj Associates, learned counsel for the petitioner, learned Government Pleader for Cooperation appearing on behalf of Respondent Nos.1 & 2 and Sri M.Papa Reddy, learned counsel for the Respondent No.3. 6. Sri Vedula Venkataramana, learned Senior Counsel, would challenge the impugned order contending that the appointment of officials as members of the managing committee goes against the basic concept of cooperation. The object is achieved only by allowing the institutions to function through the members of the public and any effort to run the institutions through officials will frustrate the object of the cooperative movement. The counsel would therefore submit that if the elections failed to take place, the State Government would be justified in appointing the elected members but not the officials as persons-in-charge. He would further contend that no reasons have been assigned in preferring the officials ignoring the recommendation of the Commissioner to extend the term of the incumbent members. The officials who are eminently preoccupied with other duties will not be able to effectively deal with the affairs of the society. It is further contended that the outgoing committee did not incur any disqualification nor was it found to be ineffective in managing the affairs, therefore it was incumbent on the State Government to have extended its term. 7. On the other hand, the learned Government Pleader would justify the impugned order contending that proposals sent by the 2nd Respondent – one for extension of the incumbent committee and the other for appointing official persons-in-charge committee – was examined by the Government and that under the given circumstances, it was felt necessary to appoint the officials instead of extending term of the incumbent committee. He would further contend that incumbent committee whose term expired on 01-06-2011 has no legal right to insist for extension of its term. He would further submit that the State Government is well within its power to appoint a managing committee in its own discretion. Citing the byelaws of the 3rd respondent-society which authorize the Government to nominate officials of the managing committee, the learned Government Pleader would submit that the object of the society is no way defeated by appointing the officials to manage the affairs of the society till elections are held. Reliance is placed on the Division Bench Judgments of this Court in Deputy Registrar Co.op. Societies, Bhongir Vs. K.Gandaiah [1] and Elakolanu Primary Agricultural Co.op. Credit Society Ltd. Vs. Govt. of A.P. [2]. 8. I have considered the rival contentions. 9. Indisputably the original term of the existing members expired on 2.12.2010 and the term of the persons-in-charge committee appointed vide orders of the 2nd respondent dated 30.11.2010 also expired on 1.06.2011. 10. Section 32(3) (a) (i) provides that if there is no committee or in the opinion of the Government or, the Registrar as the case may be, it is not possible to conduct election, the Government/Registrar may appoint a person or persons to manage the affairs of the society for a period not exceeding six months and also to extend the term, from time to time for an aggregate period of three years. Therefore there cannot be any dispute that the Government or Registrar, as the case may be, are competent to appoint any person or persons or extend the term of the incumbent members at their discretion and there is no obligation on the said authorities to appoint the out going members of the committee. 11. In a given case the Government may, instead of making fresh appoint may think it proper to extend the term of the existing members or it may think it fit to appoint an altogether new person. As a necessary corollary, no legal or vested right is created in favour of the incumbent members to seek extension of their term. Once the term of the incumbent members has expired, they automatically cease to function. There is nothing in the language of Section 32(7)(a) to indicate that a person appointed shall as a matter of right be entitled to be continued. 12. In Registrar, Co.op., Societies, Bhongir Vs. K.Gandaiah a learned Division Bench of this Court held as follows. “When an elected Committee itself has been held not to have any vested or statutory right for extension of its term as a matter of right under Section 31(2) (b), we do not think, the person or persons appointed to manage the affairs of the society under Section 32(7) (a) of the Act, have any better or higher right than the elected Committee, and claim extension of time as a matter of right. For all the aforesaid reasons, we are unable to agree with the contention of the learned counsel for the petitioners in all the writ petitions that the Registrar has no power to appoint different persons to manage the affairs of the Society.” 13. It is true that there are no allegations against the out going members of the society and that they are not disqualified for being continued, but the same by itself cannot be a ground to appoint the out going members alone as persons-in-charge. A learned Division Bench of this Court in Elakolanu Primary Agricultural Co.op. Credit Society Ltd. Vs. Govt. of A.P. considering the provisions of Section 32 (7) held as follows. “A bare perusal of the aforementioned provision would clearly show that even assuming that the appellants herein do not stand disqualified, the same by itself cannot be a ground for their appointment as persons-in-charge. A writ in the nature of mandamus can be issued provided the writ petitioner establishes the existence of a legal right in himself and a corresponding legal duty in the respondent. Section 32(7) of the Act does not envisage that only the erstwhile members of the Co-operative Society would be appointed as persons-in-charge. Section 32(7) confers discretion upon the appropriate authority to appoint persons-in-charge. It is not the case of the appellants that such a discretion has been arbitrarily exercised or is abused by the respondents herein. In such a situation, we are of the opinion that in the absence of the plea of malice-in-law, the Court shall not issue any directions which run contrary to the discretionary power conferred upon the appointing authority in terms of the aforementioned clause.” 14. In an unreported W.P.No.20884 of 2011 a learned Division Bench while dealing with a similar issue relating to the appointment of Special Officers or person-in-charge to manage the affairs of the Mandal Praja Parishads, declined to accept the contention for extension of term of the incumbent members observing that there is no provision in the Panchayat Raj Act, which would provide for continuation of an elected member after expiry of the term and no legal right of the petitioner therein was thus infringed. 15. Thus applying the ratio of the aforesaid judgments, it must be held that the petitioner has no legal or vested right to seek extension/ appointment of the out going members as persons-in- charge committee. 16. It is true that the State Government has not recorded reasons for choosing the official persons-in-charge committee in the place of the out going committee, but the same cannot be a ground to invalidate the order. As mentioned above, the 2nd respondent though initially sent a proposal dated 18.05.2011 to extend the term of the existing persons-in-charge committee, the Government did not accept. In the meanwhile, the term of the committee expired on 1.06.2011, thus creating a vacuum. The 2nd respondent was therefore constrained to send proposal dated 4.06.2011 for appointing officials as persons-in- charge committee. In the said proposal, it was clearly mentioned that the current season was peak season for arranging fertilizers and seeds and therefore there was an urgent need for a managing committee to steer the affairs of the society. The proposal also indicated that the bye-laws of the society provide for constitution of the committee including the directors to be nominated by the Government. Apparently these are the reasons which prevailed on the Government to appoint the official persons-in-charge. 17. Section 33 of the Cooperative Societies Act, 1964 confers a right on the State Government to nominate members to the committee. Under bye-law 17 (38) (a) the management of the affairs of the society vests in the Board of Directors. The Board of Directors shall consist of not only those selected by the general body out of the delegates of the affiliated society but also those nominated by the State Government. Under Rule 34 (14) (a) (i) of the Cooperative Societies Rules, 1964 where the Government have contributed directly to the share capital of an apex society, the bye-laws of such society shall provide for the nominees of the committee, which shall ordinarily consists of an official of the finance department, the Registrar and an official or non-official. Therefore by virtue of the provisions of Section 33 r/w Rule 34 (14) (a) (i) and the aforesaid bye-law, participation of officials as nominees of the Government on the Board of Directors is mandatory and inevitable. Therefore, it cannot be said that the persons-in-charge committee consisting of officials will not be able to function properly. 18. For the foregoing reasons, the impugned order does not warrant interference. The writ petition is liable to be dismissed and is accordingly dismissed. There shall be no order as to costs. ________________ NOUSHAD ALI, J. 8th September, 2011 Js/skmr. [1] 1978-APLJ-1-347 [2] 2002 Suppl. (1) ALD 352 (DB)