Hameed Kutty M.S. v Keecheri Service Co-Operative Bank Ltd and Others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE ANIL K.NARENDRAN** **WEDNESDAY, THE 12TH DAY OF DECEMBER 2018 / 21ST AGRAHAYANA, 1940** ## **WP(C).No. 27723 of 2018** ## **PETITIONER:** **HAMEED KUTTY M.S., S/O SULAIMAN, PAZHUVELIL, KULAYATTIKARA P.O., ERNAKULAM DISTRICT – 682317.** **BY ADVS. SRI.T.R.HARIKUMAR SRI.V.G.ARUN SRI.JIBU P THOMAS** ## **RESPONDENTS:** |**1**|**THE KEECHERI SERVICE CO-OPERATIVE BANK LTD**| |---|---| ||**NO.668, REPRESENTED BY ITS SECRETARY,**| ||**KULAYATTIKARA P.O., ERNAKULAM – 682317.**| |**2**|**THE PART-TIME ADMINISTRATOR,**| ||**KEECHERI SERVICE CO-OPERATIVE BANK LTD.NO.668,**| ||**KULAYATTIKARA P.O., ERNAKULAM-682317.**| |**3**|**THE JOINT REGISTRAR OF CO-OPERATIVE**| ||**SOCIETIES(GENERAL), ERNAKULAM,**| ||**CIVIL STATION, KAKKANAD, ERNAKULAM – 682030.**| ||**BY ADVS.**| ||**SRI.P.C.SASIDHARAN**| ||**GOVERNMENT PLEADER**| ||**SRI. MOHAMMED HASHIM, SPL.GP**| **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 12.12.2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** 2 WPC 27723 OF 2018 ## **JUDGMENT** The petitioner, who was elected as the President of the 1[st] respondent Society, by its Managing Committee, which came in office on 18.11.2013, and the term of which expired on 17.11.2018, has filed this writ petition under Article 226 of the Constitution of India, seeking a writ of certiorari to quash Ext.P3 notice dated 28.12.2016 issued by the 3[rd] respondent Joint Registrar and Ext.P6 notice dated 31.07.2018 issued by the 3[rd] respondent in exercise of his powers under Section 32(1) of the Kerala Co-operative Societies Act. The petitioner has also sought for a writ of mandamus commanding respondents 2 and 3 to reinstate to power, the elected Managing Committee of the 1[st] respondent Society, forthwith. 2. On 21.08.2018, when this writ petition came for admission, urgent notice on admission by speed post was ordered to respondents 1 and 2, returnable by 03.09.2018. The learned Special Government Pleader took notice on admission for the 3[rd] respondent and sought time to file statement/counter affidavit. 3. A counter affidavit has been filed by the 3[rd] WPC 27723 OF 2018 3 respondent, opposing the reliefs sought for. The petitioner has also filed reply affidavit. The petitioner has also filed I.A.No.1 of 2018, seeking an order to accept Exts.P8 and P9 as additional documents. 4. Heard the learned counsel for the petitioner, the learned Special Government Pleader appearing for respondents 1 and 2 and also the learned Special Government Pleader appearing for the 3[rd] respondent Joint Registrar. 5. The sole issue that arises for consideration in this writ petition is as to whether any interference is warranted on Exts.P3 and P6, invoking the writ jurisdiction of this Court under Article 226 of the Constitution of India. 6. Ext.P3 notice issued by the 3[rd] respondent Joint Registrar was under challenge before this Court in W.P. (C)No.33027 of 2016, which was disposed of by Ext.P2 judgment dated 07.12.2016, by directing the Joint Registrar of Co-operative Societies to take a final decision as to whether the Managing Committee of the 1[st] respondent Bank is liable to be removed under Section 32(1) of the Act, after affording an opportunity of hearing to the Managing Committee, untrammelled by the finding 4 WPC 27723 OF 2018 and observations contained in the judgment, within six weeks from the date of receipt of a certified copy of that judgment. 7. Ext.P2 judgment of the learned Single Judge was under challenge in W.A.No.14 of 2017 and connected case, which were dismissed by Ext.P5 judgment of the Division Bench dated 26.06.2018. Paragraph 3 of the said judgment reads thus; “3. The period of suspension of the Board of the Cooperative Society in W.A.No.14/2017 is from 6.10.2016 to 6.4.2017 and in W.A.No.66/2018 is for a period of six months from 25.10.2017. It appears that the society in W.A.No.14/2017 has been served with a notice of supersession dated 28.12.2016 which has been responded to and the proceedings are to be taken to a logical end. The Board of the society in W.A.No.66/2018 has been superseded on 5.3.2018 after revoking the suspension which is challenged in W.P.(C)No.9480/2018 pending. We do feel that the above writ appeals challenging the orders keeping the Board of the society under suspension have become infructuous since the period has already expired. Suffice it to say that the contentions of the appellants are left open to be considered in the challenge to the proceedings for supersession initiated by the Joint Registrar.” It is thereafter that the 3[rd] respondent Joint Registrar issued Ext.P6 notice dated 31.07.2018. 5 WPC 27723 OF 2018 8. During the course of arguments, the learned Special Government Pleader would point out that Ext.P6 is only a notice and the petitioner can raise all legal and factual contentions before the 3[rd] respondent Joint Registrar and as such, no interference is warranted on Ext.P6, invoking the writ jurisdiction under Article 226 of the Constitution of India. 9. In **State of U.P v. Brahm Datt Sharma [(1987) 2 SCC 17f9]** the Apex Court held that, when the show cause notice was issued under a statutory provision calling upon to show cause, the courts should be reluctant to interfere with the notice at that stage unless the notice is shown to have been issued palpably without any authority of law. The purpose of issuing show cause notice is to afford an opportunity of hearing and once cause is shown it is open to the authority to consider the matter in the light of the facts and submission placed before it and only thereafter a final decision in the matter could be taken. Therefore, interference by the Court before that would be premature. 10. In **Seimens Ltd v. State of Maharashtra [(2006) 12 SCC 33]** the Apex Court held that ordinarily, a writ court may WPC 27723 OF 2018 6 not exercise its discretionary jurisdiction to entertain a writ petition questioning a notice to show cause unless the notice appears to have been without jurisdiction. 11. In **Union of India v. Vicco Laboratories [(2007) 13 SCC 270]** the Apex Court held that, normally, the writ court should not interfere at the stage of issuance of show cause notice by the authorities. In such a case, the parties get ample opportunity to put forth their contentions before the authorities concerned and satisfy the authorities concerned about the absence of case for proceeding against the person against whom the show cause notices have been issued. Abstinence from interference at the stage of issuance of show cause notice in order to relegate the parties to the proceedings before the authorities concerned is the normal rule. However, the said rule is not without exceptions. Where a show cause notice is issued either without jurisdiction or in an abuse of process of law, certainly, in that case, the writ court would not hesitate to interfere even at the stage of issuance of the show cause notice. The interference at the show cause notice stage should be rare and not in a routine manner. The mere assertion by the writ 7 WPC 27723 OF 2018 petitioner that notice was without jurisdiction and/or abuse of process of law would not suffice. It should be prima facie established to be so. Where factual adjudication would be necessary, interference is ruled out. 12. In view of the law laid down in the decisions referred to supra, no interference under Article 226 of the Constitution of India is warranted on a show cause notice issued under a statutory provision unless the notice is shown to have been issued palpably without any authority of law or that it is an abuse of process of law. The mere assertion in the writ petition that the show cause notice has been issued without any authority of law or that it is an abuse of process of law would not suffice. It should be prima facie established to be so. Where factual adjudication would be necessary, no interference of this Court in exercise of the extraordinary jurisdiction under Article 226 of the Constitution is warranted. 13. Having considered the averments and also the grounds raised in this writ petition, this Court finds that the petitioner has not made out a case warranting interference on Ext.P6 notice, in exercise of the extraordinary jurisdiction of this Court under WPC 27723 OF 2018 8 Article 226 of the Constitution of India. It is for the petitioners to show cause to Ext.P6 notice by submitting a proper explanation, so as to enable the 3rd respondent Joint Registrar to take a final decision on the matter. 14. In **State of M.P. v. Sanjay Nagayach [(2013) 7 SCC 25]** the Apex Court, in the context of Section 53 of the Madhya Pradesh Co-operative Societies Act, 1960 held that, the Registrar/Joint Registrar, while exercising powers of supersession has to form an opinion and that opinion must be based on some objective criteria, which has nexus with the final decision. A statutory authority shall not act with preconceived notion and shall not speak his masters' voice, because the formation of opinion must be his own, not somebody else in power, to achieve some ulterior motive. There may be situations where the Registrar/Joint Registrar are expected to act in the best interest of the society and its members, but in such situations, they have to act bona fide and within the four corners of the Statute. In paragraph 42 of the judgment (SCC @pages 44 & 45), the Apex Court laid down the general directions in the matter of supersession of the elected committee. WPC 27723 OF 2018 9 15. In **Sanjay Nagayach's case (supra)** , the order of supersession was passed by the Joint Registrar after a period of two and a half years of the issuance of show cause notice and most of the charges levelled against the Board of Directors were related to the period when the previous committee was in office and even the charges based on the audit report dated 25.9.2008 were also rectified by the Board of Directors by addressing the primary societies. Based on the decision of the Apex Court In **Sanjay Nagayach's case** , the Registrar of Co-operative Societies has issued Circular No.45/13 dated 12.07.2013. 16. The learned counsel for the petitioner would submit that the petitioner has already made Exts.P8 and P9 applications before respondents 1 and 2, seeking certain documents in order to submit a proper explanation to Ext.P6 notice and that, on receipt of such documents, he shall submit an explanation to that notice. 17. The learned Special Government Pleader, on instructions, would submit that the documents sought for in Exts.P8 and P9 have already been furnished to the parties to Ext.P6 notice, on 14.11.2018. WPC 27723 OF 2018 10 18. The learned counsel for the petitioner would submit that, once the 3[rd] respondent Joint Registrar notifies the date of hearing, the petitioner and other members in the Managing Committee of the 1[st] respondent Society shall appear in person and submit their explanations to Ext.P6 show-cause notice. 19. In such circumstance, this writ petition is disposed of with the following directions; i). Within two weeks from the date of receipt of a certified copy of this judgment, the petitioner and other members in the Managing Committee of the 1[st] respondent Society shall submit their explanations, if any, to Ext.P6 notice dated 31.07.2018 issued by the 3[rd] respondent Joint Registrar, raising all legal and factual contentions. ii) Thereafter, the 3[rd] respondent Joint Registrar shall conduct a personal hearing, with notice to the petitioner and other members in the Managing Committee of the 1[st] respondent Society and after affording them an opportunity of being heard, and pass appropriate orders, taking note of the law laid down by the Apex Court in the WPC 27723 OF 2018 11 decision referred to supra. All legal and factual contentions raised by the petitioner are left open to be raised before the 3[rd] respondent at appropriate stage. Sd/- **ANIL K. NARENDRAN JUDGE** **yd** 12 WPC 27723 OF 2018 ## **APPENDIX** ## **PETITIONER'S EXHIBITS:** **EXHIBIT P1** **A TRUE COPY OF THE SUSPENSION ORDER NO.CRP(1) 4387/2015 DATED 06.10.2016 ISSUED BY THE 3RD RESPONDENT.** **EXHIBIT P2 A TRUE COPY OF THE JUDGMENT DATED 07.12.2016 IN WPC NO.33027 OF 2016.** - **EXHIBIT P3 A TRUE COPY OF THE NOTICE NO.CRP(1)4387/15 DATED 28.12.2016 ISSUED BY THE 3RD RESPONDENT.** - **EXHIBIT P4 A TRUE COPY OF THE INTERIM ORDER DATED 10.01.2017 IN W.A.NO.14 OF 2017.** **EXHIBIT P5 A TRUE COPY OF THE JUDGMENT DATED 26.06.2018 IN W.A.NO.14 OF 2017. EXHIBIT P6 A TRUE COPY OF THE NOTICE NO.CRP(1)4387/15 DATED 31.07.2018 ISSUED BY THE 3RD RESPONDENT. EXHIBIT P7 A TRUE COPY OF THE REQUEST DATED 13.08.2018 SUBMITTED BY THE PETITIONER AND OTHERS BEFORE THE 3RD RESPONDENT.** - **EXHIBIT P8 A TRUE COPY OF THE REPRESENTATION FILED BEFORE THE SECRETARY OF THE 1ST RESPONDENT DATED 03.11.2018.** - **EXHIBIT P9 A TRUE COPY OF THE REPRESENTATION FILED BEFORE THE 2ND RESPONDENT DATED 07.11.2018.** ## **3RD RESPONDENT'S EXHIBITS:** **EXHIBIT R3(A) A TRUE COPY OF THE COMMUNICATION DATED 23.09.2017 OF THIS RESPONDENT.** **EXHIBIT R3(B) A TRUE COPY OF THE COMMUNICATION DATED 29.05.2018.** ## **TRUE COPY** **P.A. TO JUDGE**