A resignation tendered by a Chairman of a Cooperative Society operates from the date of its tender and that no acceptance of the resignation is necessary: Bombay High Court

 on 30 11 2021 on 30 11 1 wp10757 21IN THE HIGH COURT OF JUDICATURE AT BOMBAYBENCH AT AURANGABAD WRIT PETITION NO. 10757 OF 2021Kashinath s o Kundlik Dongare Age : 56 years Occu Business R o 1514 Dwarka Rahane Mala Sangamner Tq. Sangamner Dist.Ahmednagar ..PETITIONERVERSUS1.Ahmednagar Zilla Maratha SevaNagari Sahakari Patsanstha Maliwada Ahmednagar Through its General Manager.2.Babasaheb s o Chhagan Bhagat Age : Major Occu:Business R o. Balaji Travel Kothi Road Ahmednagar.3.The District Deputy Registrar Co operative Societies Ahmednagar.4.The Divisional Joint Registrar Co operative Societies Nashik.5.The Hon’ble Minister for State Co operation Department Mantralaya Mumbai 32...RESPONDENTS…..Mr. S.T.Shelke Advocate for the petitionerMr. S.S.Wagh Advocate for respondent No.1Mr.K.J.Suryawanshi Advocate for respondent No.2Mr. Y.G.Gujrathi A.G.P. for respondent Nos.3 to 5.….. on 30 11 2021 on 30 11 2 wp10757 21CORAM : MANGESH S. PATIL J.JUDGMENT RESERVED ON : 27.10.2021JUDGMENT PRONOUNCED ON : 30.11.2021JUDGMENT : Heard. Rule. The Rule is made returnable forthwith. The learnedadvocate Mr.Wagh waives service for respondent no.1 learned advocateMr.Suryawanshi waives service for respondent no.2 and the learned A.G.P.waives service for respondent nos.3 to 5. At the request of the parties thematter is taken up for final decision at the stage of admission.2]The petitioner is aggrieved by the order of respondent no.5 Ministerallowing revision of the respondent no.2 under Section 154 of theMaharashtra Cooperative Societies Act 1960wherebythe learned Minister confirmed the order passed by the respondent no.3District Deputy Registrar of Cooperative Societiesholding thepetitioner to have incurred a disqualification from continuing as a Director ofthe respondent no.1 Credit Cooperative Society under the provisions ofSection 73CAread with by law no.44of that Society on the groundthat in violation of the by law he was already a Director of another CreditCooperative Society. In doing so the learned Minister has quashed and set on 30 11 2021 on 30 11 3 wp10757 21aside the order passed by the respondent no.4 Divisional Joint Registrar whohad quashed and set aside the order of the D.D.R. and had dismissed thecomplaint of the respondent no.2.3]Pursuant to the stand of the petitioner learned advocate Mr.Shelkewould assail the decision of the D.D.R. and the learned Minister on 2 counts.According to him by law no.44(5) of the respondent no.1 Society isinconsistent with the provisions of Section 73A. When the legislature has laiddown specific grounds for disqualification which do not contain any provisiondebarring a person from being a Director of two societies bylaw no.44(5)laying down such a condition is clearly inconsistent and consequently illegal.In support of his submission he would place reliance on the decision ofSupreme Court in the case of Babaji Kondaji Garad Versus Nasik MerchantsCo operative Bank Ltd. Nasik and others 2 S.C.C. 50.4]His second argument is that the petitioner had already tenderedresignation from the Board of Directors of Respondent No.1 Society on06 08 2019. Since there was no stipulation in the by laws and the act as tothe manner in which such a resignation is to be tendered and accepted itunilaterally operated with immediate effect i.e. the date on which it was on 30 11 2021 on 30 11 4 wp10757 21tendered and consequently when the dispute was raised before the D.D.R. hehaving already ceased to the Director of respondent no.1 Society there was noreason for passing any order of his disqualification by resorting to bylawno.44(5). In support of his submission he would place reliance on thedecisions in the cases of Arun Trivikramrao Rajurkar and others V sGowardhan Janardhan Khotre and others 1982 Mh.L.J. 576 and PrakashMahadeo Khot & Ors V s Maruti Dada Khot & Ors 2005Bom.C.R.568.5]Per contra the learned A.G.P. and the learned advocate for therespondent no.2 would submit that bylaw no.44(5) merely provides for anadditional ground for disqualification and cannot be said to be inconsistentwith Section 73A of the Act. In this regard they would place reliance on thedecision of this Court in the matter of Sambha S o Gangaram Pikale VersusState of Maharashtra and others 1996Mh.L.J. 182.6]So far as tendering of resignation is concerned the learned A.G.P. andthe learned advocate for the respondent no.2 would submit that it was aunilateral act of the petitioner. The resignation was never accepted by therespondent no.1 and he continued to hold the post of Director in therespondent no.1 Society even while he was a Director in Saraswati Gramin on 30 11 2021 on 30 11 5 wp10757 21Bigar Sheti Sahakari Patsanstha.7]Section 73A of the Act lays down the provisions inter alia laying downvarious grounds on which a designated officer would incur disqualification. Itprovides for the definition of a ‘designated officer’ to mean the Chairman orthe President and also any other officer as may be declared by the StateGovernment. It lays down various conditions as to when a designated officercannot continue to hold such post in more than one Society. It is apparent thatthe Director of a Society does not fit into the definition of designated officer asdefined under Section 73Aof the Act. However admittedly the bylawno.44(5) of the respondent no.1 Society lays down a provision debarring amember from holding a post of Director and provides that he should not be aDirector of some other credit cooperative society. When Section 73A of the Actdoes not specifically lay down any provision in respect of eligibility of amember to hold the office of a Director whereas bylaw no.44 of therespondent no.1 lays down such a provision both operate in different spheres.It cannot be said that the bylaw is incompatible or inconsistent with theprovision of Section 73A of the Act. 8]This is what has been concluded by this Court in the matter of Sambha on 30 11 2021 on 30 11 6 wp10757 21(supra). A similar argument in that matter was discarded with followingobservations :“5]Shri Talekar submitted that sincedisqualifications have been prescribed under section73FF and section 73FFF of the Act of 1960 and underRule 58 of the Maharashtra Cooperative Societies Rules 1961 no further qualifications can be laid down underthe by laws. The argument is fallacious. What has beenprescribed in the Act and Rules are the minimum thingswhich cannot be given go by by any Co operativeSociety. Therefore disqualifications as are laid down inthe Act and rules cannot be watered down by the Societyby framing by laws contrary to it. But it does not meanthat the additional qualifications cannot be prescribedunder the by laws. In many cases qualification inrespect of residence is prescribed. In many cases number of shares which should be held by a member forbeing entitled for election as Director are alsoprescribed. It cannot be said that no additionalqualifications can be prescribed under the rules. It wouldbe within the jurisdiction of the Registrar to examinewhether the by laws including such qualifications areproper and reasonable. Since the present by law isapproved by the Registrar it can well be presumed thatthe Registrar has accepted its necessity.”9]It may be observed that Section 73FF of the Act which was in thestatute book till passing of the Maharashtra Cooperative Societies(Amendment) Act 2013 was renumbered as Section 73CA and lays down theprovisions relating to disqualification of committee and its members. This on 30 11 2021 on 30 11 7 wp10757 21provision of Section 73CA of the Act inter alia specifically lays down that aperson shall not be eligible for being a member of a committee of a society ifhe has incurred any disqualification either under Act or the Rules madethereunder. Meaning thereby that even this provision clearly provides fordisqualification of a member from continuing as a member of a committee ofa society even according to its by laws. Therefore there is no substance in thesubmission of the learned advocate Mr.Shelke that bylaw no.44(5) isinconsistent with the provisions of the Act. 10]The decision of the Supreme Court in the case of Babaji Garadis dated 6 8 2019. It bears endorsementsabout its copy having been received by the respondent no.1 as well as theconcerned office of the D.D.R. on the same date i.e. 6 8 2019. Therespondents have not pointed out any specific provision contained in the Actor the by laws of the respondent no.1 society as to the manner in which such amember can resign from the post of director. In the absence of which thedecision of this Court in the case of Arunwhich is subsequentlyfollowed in the case of Prakashwould govern the fact situation.Paragraph no.5 from the decision in the case of Prakash summarizes the law on 30 11 2021 on 30 11 10 wp10757 21as under : “5]In1982 Mh.L.J. 576 aDivision Bench held that a resignation tendered by aChairman of a Cooperative Society operates from the dateof its tender and that no acceptance of the resignation isnecessary. The Division Bench held that there was no needof the acceptance of the resignation and even if the letterof resignation is so worded as to make a request of itsbeing accepted that would not in any way affect theoperation of the resignation when tendered. InAIR 1993 SC 1662 the Supreme Courtheld that if the act of relinquishment is of a unilateralcharacter it comes into effect when such act indicating anintention to relinquish office is communicated to theCompetent Authority. The authority to whom the act ofrelinquishment is communicated is not required to takeany action and the relinquishment takes effect from thedate of such communication where the resignation isintended to operate in praesenti. InAIR 1978 SC 694 the SupremeCourt held that the general principle regardingresignations is that in the absence of a legal contractualor constitutional bar a prospective resignation can bewithdrawn at any time before it becomes effective and itbecomes effective when it operates to terminate theemployment or the office tenure of the resignor. “13]When there is no other provision laying down the procedure to befollowed for tender and acceptance of resignation the petitioner havingtendered his resignation on 6 8 2019 even before the order was passed bythe D.D.R. there was no occasion or reason to reach to a conclusion that he on 30 11 2021 on 30 11 11 wp10757 21had incurred the disqualification under the aforementioned provisions. 14]It is pertinent to note that a specific plea was taken even before theD.D.R. about such tender of the resignation and still he has chosen to discardsuch a plea on the ground that no decision was taken on the resignation bythe Board of Directors and that he still continued to function as such withoutreferring to any provision of the Act or the bylaws.15]To repeat without there being any mandate of law requiring theresignation to be accepted by following some procedure the act of tenderingresignation which is a unilateral act the relation of the petitioner as a memberof the Board of Director would cease the moment he tendered the resignation.The fact that inspite of such resignation he continued and was allowed tocontinue as a Director of the respondent no.1 in my considered view isinconsequential. It may incur some other action by the authorities but thatwould not change the scenario. 16]The upshot of the above discussion though the petitioner has failed toprove that bylaw no.44(5) of the respondent no.1 is inconsistent with theprovision of the Act and cannot be invoked since even before a decision was on 30 11 2021 on 30 11 12 wp10757 21taken by the D.D.R. he had already ceased to be a member of the Board ofDirector the D.D.R. as also the learned Minister have grossly erred in reachingto the conclusion about he having incurred the disqualification. The WritPetition therefore deserves to be allowed.17]The Writ Petition is allowed. The judgment and order under challengeis quashed and set aside. The Rule is made absolute in above terms.[MANGESH S. PATIL J.] umg 

Summary: The respondents have not pointed out any specific provision contained in the Act or the by-laws of respondent no.1 society as to the manner in which such a member can resign from the post of director. In the absence of which, there was no need of the acceptance of the resignation, and even if the letter of resignation is so worded as to make a request of its being accepted that would not in any way affect the operation of the resignation when tendered. Such an observation was made by the Hon’ble Bombay High Court before Hon’ble Justice MANGESH S. PATIL in the matter of Kashinath s/o Kundlik Dongare vs Ahmednagar Zilla Maratha Seva &amp; ors [WRIT PETITION NO. 10757 OF 2021 ] on 30.11.2021 
The facts of the case were that the petitioner was disqualified from continuing as a Director of respondent no.1 Credit Cooperative Society on the ground that he was already the chairman of another credit corporate society by the District Deputy Registrar of Cooperative Societies which was later quashed and set aside by the Divisional Joint Registrar, Co-operative Societies, Nashik but the same was upheld by the Hon’ble Minister for State, Co-operation Department. Aggrieved by such a decision of the Hon’ble Minister for State, Co-operation Department, the instant writ petition is preferred by the petitioner.

The Hon’ble High Court referred to the case of (Moti Ram V. Param Dev), AIR 1993 SC 1662 in which it was held by the Hon’ble Supreme court that “ if the act of relinquishment is of a unilateral character, it comes into effect when such act indicating an intention to relinquish office is communicated to the Competent Authority. The authority to whom the act of relinquishment is communicated is not required to take any action and the relinquishment takes effect from the date of such communication where the resignation is intended to operate in praesenti” 

Additionally, the Hon’ble High Court observed that there is no other provision laying down the procedure to be followed for tender and acceptance of resignation, the petitioner having tendered his resignation on 6/8/2019, even before the order was passed by the D.D.R., there was no occasion or reason to reach to a conclusion that he had incurred the disqualification under the aforementioned provisions. 

Finally, the Hon’ble High Court allowed the writ petition and quashed that decision of the Hon’ble Minister for State, Co-operation Department.
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Judgment Reviewed by: Rohan Kumar Thakur
 The facts of the case were that the petitioner was disqualified from continuing as a Director of respondent no.1 Credit Cooperative Society on the ground that he was already the chairman of another credit corporate society by the District Deputy Registrar of Cooperative Societies which was later quashed and set aside by the Divisional Joint Registrar, Co-operative Societies, Nashik but the same was upheld by the Hon’ble Minister for State, Co-operation Department. Aggrieved by such a decision of the Hon’ble Minister for State, Co-operation Department, the instant writ petition is preferred by the petitioner. 
The Hon’ble High Court referred to the case of (Moti Ram V. Param Dev), AIR 1993 SC 1662 in which it was held by the Hon’ble Supreme court that “ if the act of relinquishment is of a unilateral character, it comes into effect when such act indicating an intention to relinquish office is communicated to the Competent Authority. The authority to whom the act of relinquishment is communicated is not required to take any action and the relinquishment takes effect from the date of such communication where the resignation is intended to operate in praesenti” 

Additionally, the Hon’ble High Court observed that there is no other provision laying down the procedure to be followed for tender and acceptance of resignation, the petitioner having tendered his resignation on 6/8/2019, even before the order was passed by the D.D.R., there was no occasion or reason to reach to a conclusion that he had incurred the disqualification under the aforementioned provisions. 

Finally, the Hon’ble High Court allowed the writ petition and quashed that decision of the Hon’ble Minister for State, Co-operation Department.
Click Here To Read The Judgment
Judgment Reviewed by: Rohan Kumar Thakur
 The Hon’ble High Court referred to the case of (Moti Ram V. Param Dev), AIR 1993 SC 1662 in which it was held by the Hon’ble Supreme court that “ if the act of relinquishment is of a unilateral character, it comes into effect when such act indicating an intention to relinquish office is communicated to the Competent Authority. The authority to whom the act of relinquishment is communicated is not required to take any action and the relinquishment takes effect from the date of such communication where the resignation is intended to operate in praesenti”  
Additionally, the Hon’ble High Court observed that there is no other provision laying down the procedure to be followed for tender and acceptance of resignation, the petitioner having tendered his resignation on 6/8/2019, even before the order was passed by the D.D.R., there was no occasion or reason to reach to a conclusion that he had incurred the disqualification under the aforementioned provisions. 

Finally, the Hon’ble High Court allowed the writ petition and quashed that decision of the Hon’ble Minister for State, Co-operation Department.
Click Here To Read The Judgment
Judgment Reviewed by: Rohan Kumar Thakur
 Additionally, the Hon’ble High Court observed that there is no other provision laying down the procedure to be followed for tender and acceptance of resignation, the petitioner having tendered his resignation on 6/8/2019, even before the order was passed by the D.D.R., there was no occasion or reason to reach to a conclusion that he had incurred the disqualification under the aforementioned provisions.  
Finally, the Hon’ble High Court allowed the writ petition and quashed that decision of the Hon’ble Minister for State, Co-operation Department.