Case: Vipulbhai Mansingbhai Chaudhary Vs. State Of Gujarat

office bearer in the cooperative movement but to see that you may not participate in such activity and the damage is not caused to the cooperative establishment because of your such activity, it is necessary to keep you away from assuming the office in any cooperative establishment by participating in the election maximum for a period of six years.), therefore, there is a need to disqualify Chaudhary from holding or contesting for any post in any society. The mention of the facts (i) That on account of the misconduct of Chaudhary, the UNION suffered financial loss on a large scale;(ii) That the UNION consists of various smaller societies each of which has a large number of milk suppliers; and(iii) That the Registrar’s proposed to disqualify Chaudhary for maximum period of six years, in our opinion, makes the Show-Cause Notice-II sufficiently compliant with the requirement of Section 76B(2). 50. The final order disqualifying Chaudhary was passed after due compliance with the principles of natural justice. If the Registrar came to the conclusion that Chaudhary should not be permitted to contest any election or hold any office in any society functioning under THE ACT, the same, in our view, can’t be found fault with. Because Chaudhary has already been found guilty of conduct which resulted in a large scale financial irregularities in the conduct of the business of the society and also financial loss to the society. The activity of the UNION is spread over in three districts. The UNION consists of a large number of primary societies. Disqualifying Chaudhary only from the holding post in the UNION is to give him a chance to meddle with the affairs of the societies which are members of the UNION. 51. The only other question remaining to be examined is whether the period of disqualification of six years is consistent with law. Section 76B(2) as of today provides for disqualification of an officer for a period not exceeding six years. Originally the Section provided for disqualification only for four years. But the “four years” period was substituted by “six years” period by the Gujarat Co-operative Societies (Amendment) Act, 2015 (Act No.12 of 2015). 52. All the acts and omissions which formed the basis for action against Chaudhary pertained to the period anterior (Show-Cause Notice-I is dated 12.1.2015 and the Act No.12 of 2015 came into force on 7th April 2015.)to the Act No.12 of 2015. Under Section 7 of the Gujarat General Clauses Act, it is provided that where an enactment is repealed by a subsequent enactment, the repeal does not normally affect any investigation or legal proceedings in respect of any right, privilege, obligations, liability, penalty, forfeiture or punishment and any legal proceeding initiated during the currency of the repealed enactment could be continued as if the repealing Act has not been passed. Repeal could be either of the entire enactment or a part of it. Substitution of parts of an enactment is nothing but pro tanto to repeal those parts. Normally when an enactment is repealed, any action initiated under that enactment dealing its currency should lapse. Because the authority of law for action initiated under an enactment ceases to exist on its repeal rendering the continuation of action without authority of law. To meet such a contingency, the General Clauses Act made a provision under Section 7. It seeks to preserve various rights and obligations acquired or incurred under repealed enactments. It also provides for various other things incidental to preservation of such rights and obligations (Section 7 of The Gujarat General Clauses Act, 1904: “Section 7. Effect of repeal.- Where this Act, or any Bombay Act or Gujarat Act made after the commencement of this Act, repeals any enactment hitherto made or hereafter to be made, then unless a different intention appears, the repeal shall not-(a) revive anything not in force or existing at the time at which the repeal takes effect; or(b) affect the previous operation of any enactment so repealed or anything duly done or suffered thereunder; or(c) affect any right, privilege, obligation or liability acquired, accured or incurred under any enactment so repealed; or(d) affect any penalty, forfeiture or punishment incurred in respect of any offence committed against any enactment so repealed; or(e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid, and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed, as if the repealing Act had not been passed.”). 53. As a logical corollary to the above proposition, no right or liability can be created by a repealing enactment, which is inconsistent with the rights and obligations conferred under the repealed Act unless the repealing enactment makes an express declaration to that effect or adopts some other technique known to law to achieve that purpose. Giving retrospective effect to the repealing enactment is one of the techniques by which the legislature seeks to achieve that purpose.54. There is nothing in Act No.12 of 2015 which warrants an interpretation that the legislature intended to create a disqualification which would run for a maximum period of six years with retrospective effect. The learned Additional Solicitor General Shri Mehta fairly accepted it. In the circumstances, the disqualification of six years upon Chaudhary is not tenable and at best Chaudhary could be disqualified for a maximum period of four years.55. It is next argued on behalf of Chaudhary that the order dated 12.10.2015 does not disclose reasons which prompted the Registrar to impose the maximum penalty and, therefore, that order is vitiated. We do not wish to examine the submission for the reason the judgment under appeal thought it fit that disqualification of Chaudhary for a period of three years would meet the ends of justice. We are of the opinion that having regard to the acts and omissions of Chaudhary forming the basis of disqualification cannot be said to be unreasonable.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]In our opinion, LPA No.1302/2015 ought to have been dismissed on the simple ground that the said appeal had become infructuous. Because admittedly the tenure of Chaudhary as Chairman of the Society expired on 01.05.2014. Therefore, SLP (Civil) No.33630/2015 was a futile exercise. We only wonder as to how leave came to granted in the said SLP.The High Court rightly declined to interfere with those findings. We see no error in the decision of the High Court in this regard.We decline to undertake the exercise of examining the correctness of the conclusions recorded by the Registrar.Hence, the submission of Chaudhary both before the High Court and this Court thatI could not have been issued without obtaining the leave of the High Court. Such a submission found favour with the High Court in the judgment in LPA No. 1343 of 2015 when it was called upon to determine the legality of. The High Court did not assign any reason for such a conclusion nor any provision of law or precedent which warrants such a conclusion is referred to. We find it difficult to sustain thesaid conclusion is clearly untenable and is required to beand the first submission of Chaudhary is liable to be rejected. As a consequence, the second submission also falls to ground.38. We shall now deal with the third submission of Chaudhary. The submission in substance is that the acts and omissions which formed the basis of allegations leading to action against Chaudhary under Section 76B are not the individual acts of Chaudhary but the collective acts or omissions of the Committee of the UNION. Therefore, action if at all required must be taken under Section 81 against the entire Committee but not only against Chaudhary. In absence of any action against the Committee, action against Chaudhary is illegal and unsustainable.In substance, THE ACT envisages joint and several action against the officers in their capacity as members of the committee. While Section 81 is designed to deal with the dereliction of the duties by the committee as a body, Section 76B deals with the dereliction of duties of the individual members of the committee. The Registrar is invested by THE ACT with the discretion to choose the proper course of action depending upon the situation. The argument of Chaudhary is not that the Registrar abused his discretion. The submission is that it is not permissible for the Registrar to resort to action only under Section 76B. We reject the submission.45. We shall now examine the fourth submission of Chaudhary that the reliance upon the same set of facts in bothI and II would render theI and the action consequent thereupon illegal.At the outset, we must state that we have examined the tenor of both thenotices and we proceed on the basis that the tenor of both of them is substantially the same if notbasic requirement of(2) is that the power thereunder could be exercised only against an officer of a society who has already been removed from office. Therefore, the factual basis on which the action underion (2) of Section 76B is to be taken is bound to be the same though the reasons and logic on the basis of which action under either of theis to be taken could be different. Depending upon the intensity and gravity of the misconduct in a given case, mere action [under Section 76B(1)] of removal from office might suffice and meet the ends of justice. Whereas in some cases action under both themight be called for. But in no case action only under Section 76B(2) is permissible without taking action under Section 76B(1). It is also possible that in a given case, facts may not only justify but also oblige the Registrar to pass not only an order of removal under(1) but also an order of disqualification under(2) depending upon the nature of the misconduct and the legal obligation flouted by the officer.It all depends upon the facts and circumstances of each and every case and the scheme of the law relevant to such facts. The variables are too many.For the purpose of passing the order of disqualification under Section 76B(2) against Chaudhary, the Registrar rightly proceeded on the basis that there is an earlier order of the Registrar dated 10.3.2013 where charges against Chaudhary had been held proved and the High Court declined to interfere with those findings. He, therefore, opined that he is entitled to proceed to take action under Section 76B(2) on the basis of the same conclusions which rendered Chaudhary liable for removal from office under Section 76B(1). In the process, both in thenotice–II and the order dated 16.12.2015, the Registrar once again repeated all the allegations which formed the basis for the order under Section 76B(1).In our opinion, it was not really necessary. It would have sufficed if the Registrar mentioned the fact that Chaudhary was removed from the office of Chairman of the Society in exercise of the power under Section 76B(1) – the mention of such a fact is also not mandatory. It is only a condition precedent for initiating action under Section 76B(2). The requirements of valid notice under Section 76B(2), in our opinion, are that the notice should indicate broadly the reasons which prompt the Registrar to initiate action and the period for which the person, against whom the action is initiated, is proposed to be disqualified. However, the mentioning of the past history though avoidable does not in any way vitiate thenotice or the final order if they are otherwise in accordance with law.49. In our opinion, there is no legal infirmity either in the logic adopted by the Registrar or the action taken by him under Section 76B(2) on the ground that the Registrar relied upon the same set of facts and the conclusions drawn thereupon for taking action both under Section 76B(1) and Section 76B(2).The final order disqualifying Chaudhary was passed after due compliance with the principles of natural justice. If the Registrar came to the conclusion that Chaudhary should not be permitted to contest any election or hold any office in any society functioning under THE ACT, the same, in our view,be found fault with. Because Chaudhary has already been found guilty of conduct which resulted in a large scale financial irregularities in the conduct of the business of the society and also financial loss to the society. The activity of the UNION is spread over in three districts. The UNION consists of a large number of primary societies. Disqualifying Chaudhary only from the holding post in the UNION is to give him a chance to meddle with the affairs of the societies which are members of the UNION.As a logical corollary to the above proposition, no right or liability can be created by a repealing enactment, which is inconsistent with the rights and obligations conferred under the repealed Act unless the repealing enactment makes an express declaration to that effect or adopts some other technique known to law to achieve that purpose. Giving retrospective effect to the repealing enactment is one of the techniques by which the legislature seeks to achieve that purpose.54. There is nothing in Act No.12 of 2015 which warrants an interpretation that the legislature intended to create a disqualification which would run for a maximum period of six years with retrospective effect. The learned Additional Solicitor General Shri Mehta fairly accepted it. In the circumstances, the disqualification of six years upon Chaudhary is not tenable and at best Chaudhary could be disqualified for a maximum period of four years.55. It is next argued on behalf of Chaudhary that the order dated 12.10.2015 does not disclose reasons which prompted the Registrar to impose the maximum penalty and, therefore, that order is vitiated. We do not wish to examine the submission for the reason the judgment under appeal thought it fit that disqualification of Chaudhary for a period of three years would meet the ends of justice. We are of the opinion that having regard to the acts and omissions of Chaudhary forming the basis of disqualification cannot be said to be unreasonable.