Kunnathukal Service Co-operative Bank Ltd. v. State Co-operative Election Commission

# **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** ## **`PRESENT`** ## **`THE HONOURABLE MR. JUSTICE GOPINATH P.`** ``` MONDAY, THE 7[TH] DAY OF AUGUST 2023 / 16TH SRAVANA, 1945 WP(C) NO. 22938 OF 2023 ``` ## **`PETITIONER:`** ``` KUNNATHUKAL SERVICE CO-OPERATIVE BANK LTD.NO. 1101 KUNNATHUKAL.P.O., THIRUVANANTHAPURAM, PIN – 695 504. REPRESENTED BY ITS PRESIDENT. ``` ``` BY ADVS. B.S.SWATHI KUMAR ANITHA RAVINDRAN HARISANKAR N UNNI ``` ## **`RESPONDENTS:`** ``` 1THE STATE CO-OPERATIVE ELECTION COMMISSION CO-BANK TOWERS, VIKAS BHAVAN, PALAYAM, THIRUVANANTHAPURAM, PIN – 695 033. REPRESENTED BY ITS SECRETARY ``` ``` 2THE ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL), NEYYATTINKARA, THIRUVANANTHAPURAM, PIN – 695 141. 3ADDL. R3. V.UDAYA KUMAR, AGED 47 YEARS, S/O.VIKRAMAN PANICKER, V.S.BHAVAN, NILAMAMOODU, CHERIYAKOLLA.P.O., THIRUVANANTHAPURAM – 695 504. 4ADDL. R4. G. KUMAR, AGED 50 YEARS, S/O. GOPINATHAN NAIR, ARCHANA MOOPPUKALA KUNNATHUKAL, KARAKONAM P.O., THIRUVANANTHAPURAM-695 504. ``` 2 W.P.(C)No.22938/2023 ``` 5ADDL. R5. VIJAY LOVLIN A.J., S/O. ANTONY BABU, LOVLIN NIVAS, UNDANCODE, MEKKINKARA, VALIYAKAL, ELLUVILA P.O.-695 504. IS IMPLEADED AS PER ORDER DATED 26.07.2023 IN I.A.1/2023 IN THE WP(C). ``` ``` BY ADVS. C.M.NAZAR SUMAN CHAKRAVARTHY K.R.RIJA RESHMI THOMAS (GP) ``` ``` THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 07.08.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` 3 W.P.(C)No.22938/2023 ## **JUDGMENT** Petitioner is a Primary Agricultural Credit Co-operative Society, registered under the Kerala Co-operative Societies Act, 1969 (hereinafter referred to as ‘the Act’). The Managing Committee of the Society resolved to conduct fresh elections to the Managing Committee on 20-08-2023 from 8.00 A.M. to 4.00 P.M. at LMS Upper Primary School, Kottukonam and the resolution was duly forwarded to the competent authority in terms of Ext.P1. The petitioner was thereafter served with Ext.P3 communication by the Assistant Registrar of Cooperative Societies stating that there have been certain complaints that membership has not been granted by the Society to several persons eligible to obtain such membership. Subsequently the petitioner was served with an order dated 07-07-2023 of the 2[nd] respondent stating that since membership has not been given to certain eligible persons, the resolution to hold the elections must be taken afresh after granting membership to eligible persons. 2. The learned counsel appearing for the petitioner would submit that there is absolutely no rhyme or reason for 4 W.P.(C)No.22938/2023 the 2[nd] respondent to refuse to act on the resolution taken by the Managing Committee to hold elections on 20-08-2023. It is submitted that the statute contemplates a definite procedure for the purposes of adjudication of claims for membership and unless the right to membership is established by adopting that procedure, the 2[nd] respondent could not have taken it up on himself to withhold the resolution for holding the elections. It is submitted that the 2[nd] respondent cannot adjudicate on the rights of membership and therefore the decision taken by him not to act on the resolution taken by the Managing Committee to hold elections on 20-08-2023 is clearly without jurisdiction. It is submitted that the consequent communication issued by the State Co-operative Election Commission (Ext.P6) on the basis of the information provided by the 2[nd] respondent that memberships have been denied to several persons is also clearly illegal. It is submitted that though the term of the Managing Committee is till 20-10-2023, it is open to the Managing Committee to decide the holding of elections on any earlier date, as has been held by this Court in **Managing Committee, Thiruvalla East Cooperative Bank Ltd. v. State Co-operative Election** 5 W.P.(C)No.22938/2023 ## **Commission, Tvm and Others; 2016 (4) KHC 703** , which has been followed by this Court in Ext.P7 judgment in W.P.(C)No.15779 of 2023. 3. The learned Standing Counsel appearing for the State Co-operative Election Commission would submit that the State Co-operative Election Commission had only acted on the information provided by the Assistant Registrar and therefore there is no illegality whatsoever in Ext.P6 communication. 4. The learned Government Pleader would also support the stand taken by the 2[nd] respondent and contend that when it is clear that elections were being held earlier to deny the membership claim of eligible persons, which has a direct bearing on the election results, the 2[nd] respondent was right in not taking action on the basis of the resolution for holding elections on 20-08-2023. 5. The learned counsel appearing for additional respondents 3 to 5 (persons who had applied for membership) would submit that in the facts of the present case it is clear that the resolution to hold elections on an earlier date was to defeat democratic process by denying membership to eligible persons. It is submitted that there is a clear finding by the 2[nd] 6 W.P.(C)No.22938/2023 respondent that large number of applications for membership have been unnecessarily kept pending by the Managing Committee of the Society, without processing them. It is submitted that holding of elections in such circumstances would clearly be contrary to the interest of the Society and to democratic principles. It is submitted that the only reason for denying membership to eligible persons is to ensure that, only persons who are favourable to the present Managing Committee, are granted membership in the Society. It is submitted that since the term of the Society is till October 2023 and since there were complaints regarding denial of membership to eligible persons, there is nothing wrong in the proceedings of respondents 1 and 2 in refusing to hold elections on 20-08-2023, on the basis of the resolution passed by the Managing Committee. 6. Having heard the learned counsel for the petitioner, the learned Standing Counsel for the State Co-operative Election Commission, the learned Government Pleader for the 2[nd] respondent and the learned counsel appearing for additional respondents 3 to 5, I am of the view that the issues stand covered in favour of the petitioner by virtue of the 7 W.P.(C)No.22938/2023 judgment of this Court in W.P.(C)No.22430/2023. There, the question considered was, whether the elections to the Managing Committee could be postponed on the ground that there were complaints regarding denial of membership. In paragraph No.6 of the judgment in W.P.(C)No.22430/2023, I have held as follows: “6. Having heard the learned Senior Counsel appearing for the petitioner, the learned Standing Counsel appearing for the State Co-operative Election Commission and Adv. M.Sasindran, for additional respondents 4 to 11, I am of the opinion that the petitioner is entitled to succeed. The provisions of the Section 16 of the Kerala Co-operative Societies Act, 1969, (hereinafter referred to as ‘the Act’) contemplate a procedure for determination of the question as to whether a person is eligible for membership or not. The provisions of sub-section (2A) of Section 16 of the Act, provide that when an application for membership in a Society is not disposed of within the time specified in sub-section (2) of the Act, the Registrar shall be bound, on the written request of the applicant, to determine whether such membership shall be given or not. The provisions of sub-section (2) of Section 16 of the Act provide that a decision on the application for membership shall be taken within a period of two months from the date of receipt of the application. A combined reading of the provisions contained in sub-section (2), (2A) and (2B) of Section 16 of the Act makes it clear that the question as to whether the membership was illegality denied to any person by a Society, is a matter that has to be determined in the manner provided for in those provisions. The State Cooperative Election Commission is not called upon to defer any election or refuse to act on a resolution passed by the Society for holding elections on a particular day on the ground that there 8 W.P.(C)No.22938/2023 are complaints regarding denial of memberships to eligible persons, by the Society in question. It is clear from the submission made by the learned Standing Counsel for the State Co-operative Election Commission that the applications for membership were pending from the month of May, 2022. If that be the case it is clear from the provisions of Section 16 of the Act that the persons aggrieved had to resort to the provisions in subsection (2A) of Section 16 of the Act if they had a grievance that the membership had been illegally denied to them. Having failed to do so it cannot be contended at the time when a resolution had been forwarded for the purposes of holding elections, that the elections should not be held for the reason that there was illegal denial of membership. In that view of the matter and taking into consideration the fact that a fresh resolution has been forwarded to the State Co-operative Election Commission, for holding elections on 04-09-2023, and also taking into consideration the submission of the learned Standing Counsel for the State Co-operative Election Commission that the said resolution has not been received through the Registrar of Cooperative Societies, this writ petition will stand disposed of with the following directions: (i) The Registrar of Co-operative Societies shall forward the resolution passed by the Managing Committee of the petitioner-Society for holding of elections on 04-09-2023 to the State Co-operative Election Commission forthwith; (ii) On receipt of such resolution the State Cooperative Election Commission shall take steps to hold the elections in compliance with the provisions of Rule 35A of the Co-operative Rules 1969 without any further delay and in a manner ensuring that the elections are held and the results are declared before the term of the existing managing committee expires.” In the facts of the present case, the learned counsel for the 9 W.P.(C)No.22938/2023 petitioner is right in contending that the 2[nd] respondent (Assistant Registrar of Co-operative Societies) had no jurisdiction to decide any complaint regarding denial of membership, which can be done only in terms of the provisions contained in Section 16 of the Act. 7. Similarly, the mere fact that the Managing Committee had taken a resolution to hold elections nearly two months prior to the date on which the term of the present committee would expire is no ground to hold that the elections need not be conducted on the date selected by the Managing Committee in terms of the resolution forwarded for the consideration of the State Election Commission. The judgment of this Court in **Managing Committee, Thiruvalla East Co-operative Bank Ltd. (supra),** is authority for the proposition that there is absolutely no illegality in a resolution being adopted much earlier than the 60 days period mandated by the provisions of Rule 35 A of the Co-operative Societies Rules, 1969, for forwarding a resolution for holding elections to the Managing Committee of a Society. That apart, as already observed, I am of the view that unless the right to membership is adjudicated in terms of the provisions 10 W.P.(C)No.22938/2023 contained in Section 16(4) of the Act, it would not be proper for the authority to withhold the conduct of elections on the ground that there were complaints regarding denial of membership to eligible persons. For all these reasons, this writ petition is allowed and the following directions are issued: (i) The petitioner-Society shall immediately take a fresh resolution for holding elections to the Managing Committee of the Society and forward the same for consideration of the 2[nd] respondent; (ii) The 2[nd] respondent shall immediately (on receipt of the resolution) forward the same to the 1[st] respondent for the purposes of notifying the elections. The fact that there are complaints regarding denial of membership shall not be a ground to refuse the holding of elections in terms of the resolution to be passed by the Society. (iii) Any complaints raised by the respondents 3 to 5 and others regarding denial of membership shall be adjudicated by the competent authority, in accordance with the law. **Sd/-** **GOPINATH P. JUDGE** ats 11 W.P.(C)No.22938/2023 ## **`APPENDIX OF WP(C) 22938/2023`** ``` PETITIONER’S EXHIBITS ``` ``` Exhibit P1TRUE COPY OF THE APPLICATION NO. TVM/1516/2023 DATED 15-6-2023 SUBMITTED BY THE PETITIONER BEFORE THE 1ST RESPONDENT. ``` - `Exhibit P2 TRUE COPY OF THE LETTER NO. 21/23 DATED 15-6-2023 SUBMITTED BY THE PETITIONER BEFORE THE 1ST RESPONDENT.` - `Exhibit P3 TRUE COPY OF THE COMMUNICATION NO. NEYY. 1405/2023 DATED 29-5-2023 OF THE 2ND RESPONDENT.` - `Exhibit P4 TRUE COPY OF THE COMMUNICATION NO. E(2)3777/2023/SCEC DATED 22-6-2023 OF THE 1ST RESPONDENT.` - `Exhibit P5 TRUE COPY OF THE ORDER NO. NEYY. 1531/2023 DATED 7-7-2023 OF THE 1ST RESPONDENT.` - `Exhibit P6 TRUE COPY OF THE ORDER NO. E(2)3777/2023/SCEC DATED 6-7-2023 OF THE 1ST RESPONDENT.` - `Exhibit P7 TRUE COPY OF THE JUDGMENT IN W.P(C)NO. 15779/2023 DATED 30-5-2023` ## `RESPONDENTS’ EXHIBITS` - `Exhibit-R3(a) A true copy of application submitted by the 3rd respondent before the Assistant Registrar of Co-operative Societies Neyyattinkara dated 11.07.2023` - `Exhibit-R3(b) A true copy of application of the addl.4th respondent` ``` Exhibit-R3(c)A true copy of the communication No.1531/2023 of the Assistant Registrar of Co-operative Societies Neyyattinkara ``` 12 W.P.(C)No.22938/2023 ``` Exhibit-3(d)A true copy of communication dated 27.06.2023 by the 2nd respondent addressed to the 1st respondent ``` ``` Exhibit-R3(e)A true copy of the letter addressed to Arun.H.S an applicant dated 26.06.2023 ```