Pattancherry Service Co-operative Bank Ltd. No. 58, Pattancherry vs The Joint Registrar of Co-operative Societies, Palakkad and Sri V. Shamsuddin

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** ## **THE HONOURABLE MR. JUSTICE SHAJI P.CHALY** ## **FRIDAY, THE 10TH DAY OF JUNE 2016/20TH JYAISHTA, 1938** ## **WP(C).No. 28173 of 2008 (D)** ## **-------------------------------------------** **PETITIONER(S) :** **--------------------------** **THE PATTANCHERRY SERVICE CO-OPERATIVE BANK LTD. NO. 58, PATTANCHERRY 678 532, CHITTUR TALUK, PALAKKAD DISTRICT, REPRESENTED BY ITS PRESIDENT.** **BY SRI.K.RAMAKUMAR (SENIOR ADVOCATE) ADV. SMT.SMITHA GEORGE** **RESPONDENT(S) :** **----------------------------** **1. THE JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES, PALAKKAD.** **2. SRI. V.SHAMSUDDIN, S/O. VELLAPPA RAUTHER, PYRAY MANZIL, NANDANKIZHAYA, ANAMARI P.O., KOLLENGODE, CHITTUR TALUK, PALAKAD DISTRICT.** - **R1 BY GOVERNMENT PLEADER SRI. G.GOPAKUMAR R2 BY ADV. SRI.P.R.VENKETESH** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 10-06-2016, ALONG WITH W.P(C).NO. 8263 OF 2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** Msd. ## **WP(C).No. 28173 of 2008 (D)** ## **-------------------------------------------** ## **APPENDIX** ## **PETITIONER(S)' EXHIBITS :** **EXHIBIT P1: TRUE COPY OF THE JUDGMENT DATED 24.01.2000 IN W.A.NO. 638 OF 1998.** **EXHIBIT P2: TRUE COPY OF THE ORDER PASSED BY R1 DATED 31.03.2000.** - **EXHIBIT P3: TRUE COPY OF THE JUDGMENT DATED 28.02.2006 IN O.P.NO. 17731 OF 2000.** - **EXHIBIT P4: TRUE COPY OF THE JUDGMENT DATED 04.08.2006 IN W.A.NO. 952 OF 2006.** - **EXHIBIT P5: TRUE COPY OF THE NOTES OF ARGUMENT FILED ON BEHALF OF THE PETITIONER SOCIETY BEFORE R1.** - **EXHIBIT P6: TRUE COPY OF THE ORDER DATED 30.08.2008 PASSED BY R1.** **RESPONDENT(S)' EXHIBITS :** **EXHIBIT R2(A): TRUE COPY OF THE FIRST ORDER PASSED BY THIS HON'BLE COURT IN O.P.NO. 43/1993.** ## **//TRUE COPY//** **P.A.TO JUDGE.** Msd. ## **SHAJI P. CHALY, J.** ----------------------------------------------- **W.P.(C). Nos. 28173 of 2008 & 8263 of 2009 ----------------------------------------------Dated this the 10[th] day of June, 2016** ## **JUDGMENT** The captioned writ petitioners are connected and therefore I proposed to dispose of the same by a common judgment. W.P.(C)No.28173/2008 is challenging Ext.P6 order passed by the first respondent invoking the powers conferred under Rule 176 of the Co-operative Societies Rules (for short 'the Rules'). During the pendency of the said writ petition, second respondent herein filed ARC No.148/2008 before the Co-operative Arbitration Court with respect to the same issue and therefore, the petitioner Bank has filed the second writ petition and sought stay of the arbitration proceedings to avoid continuance of parallel proceedings. 2. Brief facts for the disposal of these writ petitions are thus:- Second respondent was the Secretary of the petitioner W.P.(C). Nos. 28173 of 2008 & 8263 of 2009 **==> picture [7 x 9] intentionally omitted <==** Bank, who was proceeded against for serious and grave irregularities and was placed under suspension. Thereafter, the Board of Directors decided to dismiss the second respondent from service by an order dated 13.1.1993. Against the dismissal order, second respondent filed O.P.No.3134/1993 before this Court and secured a judgment in his favour. Aggrieved by the judgment of the learned Single Judge, petitioner filed Writ Appeal by which respondent No.1 was directed to reconsider the matter and take a decision on the same, in accordance with law. 3. Thereafter, first respondent has passed an order dated 31.3.2000 affirming Ext.P2 order passed by him. 4. Aggrieved by Ext.P2 order, second respondent preferred writ petition before this Court and secured Ext.P3 judgment. Ext.P3 was challenged by the petitioner and Ext.P4 judgment was secured directing the first respondent to reconsider the issue again taking into W.P.(C). Nos. 28173 of 2008 & 8263 of 2009 **==> picture [7 x 10] intentionally omitted <==** account the power under Rule 176 of the Rules in view of the introduction of Section 69 of the Act. Thereafter, first respondent passed Ext.P6 order holding that, first respondent is vested with powers to invoke Rule 176 of the Rules even though Section 69 is introduced in the statute book and thereupon, rescinded the resolution of the Bank dismissing the petitioner from service in disciplinary proceedings. It is thus challenging Ext.P6 order of the first respondent, petitioner has filed W.P.(C) No.28173/2008. 5. Counter affidavit is filed by the second respondent refuting the contentions, allegations and statements contained in the writ petition and canvassed the preposition that the first respondent is vested with powers under Rule 176 of the Rules to rescind a resolution drawn by the petitioner. That apart, it is contended that, the first respondent has adverted to all the factual and legal circumstances while passing Ext.P6 W.P.(C). Nos. 28173 of 2008 & 8263 of 2009 4 order and therefore, there are no circumstances legal or factual warranting interference by this Court under Article 226 of the Constitution of India. 6. Heard learned counsel for the petitioner, learned Government Pleader and learned counsel for second respondent. 7. The crux of the contention advanced by the learned senior counsel for the petitioner is that consequent to the introduction of Chapter IX into the Cooperative Societies Act any dispute between the society or its committee and any past committee, any officer, agent or employee or any past officer, past agent or past employee or the nominee, heirs or legal representatives or any deceased officer etc. etc. are taken care of under Section 69(1)(c) of the Act. It is urged that Section 69 opens with a _non obstante_ clause interdicting any other law for the time being in force with respect to a dispute stipulated thereunder. Which thus means consequent on W.P.(C). Nos. 28173 of 2008 & 8263 of 2009 **==> picture [7 x 9] intentionally omitted <==** the introduction of Section 69 with effect from the year 2000 the authority to decide any dispute contained thereunder is vested with the arbitrator appointed under Section 70. Therefore, learned senior counsel contended that Ext.P6 cannot be sustained at all since, the cause of action with respect to the dispute by and between the petitioners and the 4[th] respondent, after the introduction of Section 69 is vested with arbitrator appointed and therefore Ext.P6 cannot be sustained. 8. That apart, it is also contended that after Ext.P6 order was passed, 4[th] respondent has approached the arbitrator by filing ARC No.148/2008 with respect to the same cause of action and therefore, 4[th] respondent himself is aware of the fact that since the jurisdiction of first respondent was invoked after the introduction of Chapter IX, the remedy available to the 4[th] respondent was to approach the arbitrator. Learned counsel has also invited my attention to the judgment rendered by this W.P.(C). Nos. 28173 of 2008 & 8263 of 2009 6 Court in **Thrissur Taluk Co-operative College Educational Society Ltd v. Joint Registrar** [2012(1) KLT 503] and **Cheranallur Service Co-operative Bank Ltd. v. State of Kerala and Others** [ 2012(3) KHC 834] and canvassed the proposition and contended that the said two judgments are authority for the subject issue canvassed by the petitioner in the writ petitions. I have gone through the said judgments and find that therein also the question with respect to the power of first respondent under Rule 176 vis-a-vis Section 69 was considered and it was concluded that after the introduction of Section 69 the first respondent has lost his power conferred under Rule 176 with respect to the matters dealt with under Section 69 of the Act. 9. On the other hand, learned counsel for the 4[th] respondent contended that Ext.P6 order passed by the first respondent is in order and the same requires no interference invoking power under Article 226 of the W.P.(C). Nos. 28173 of 2008 & 8263 of 2009 **==> picture [7 x 9] intentionally omitted <==** Constitution of India. That apart, learned counsel contended that even though Chapter IX was brought into statute book there is no prohibition to invoke Rule 176 by the first respondent, the same being independent power conferred on the first respondent irrespective of other provisions of the Co-operative Societies Act and Rules. 10. Having considered the rival submissions and evaluating the factual and legal circumstances I am of the considered opinion that the sole question to be considered in this case is whether consequent to the introduction of Chapter IX in to the Co-operative Societies Act whether the first respondent is vested with the power under Rule 176 of the Rules to rescind a resolution passed by the petitioner. On a reading of Section 69 it is categoric and clear that it starts with a _non obstante_ clause, which thus means consequent to the introduction of the said provision with respect to the matter enumerated thereunder, the arbitrator appointed W.P.(C). Nos. 28173 of 2008 & 8263 of 2009 8 under Section 69 alone has the power to decide a dispute arose thereunder. That being the position and taking into account the law laid down by this Court in the judgments cited (supra) I am of the considered opinion that petitioner is entitled to succeed in W.P.(C) No. 28173/2008 and accordingly the said writ petition is allowed setting aside Ext.P6 order passed by the first respondent. 11. So far as W.P.(C)No.8263/2009 is concerned, the subject matter is at large before the first respondent Arbitration Court and petitioner Bank has filed the writ petition since the 4[th] respondent has instituted the said proceedings, parallel to the writ petition by the petitioner. In view of the stay granted by this Court proceedings before first respondent is pending. Since I have allowed W.P.(C) No. 28173/2008 quashing Ext.P6 order of the first respondent, now there is no inhibition or other prohibition to proceed with ARC 148/2008 on the files of W.P.(C). Nos. 28173 of 2008 & 8263 of 2009 **==> picture [7 x 10] intentionally omitted <==** the first respondent. The interim order granted by this Court in the said writ petition is vacated and the same is closed directing the first respondent to take on board ARC 148/2008 and proceed in accordance with law. Since the subject matter is pending from the year 2008 and the subject issue has a long history, the first respondent will dispose of the same at the earliest and at any rate within a period of four months from the date of receipt of a copy of this judgment by giving precedence to the said matter. W.P.(C) No.8263/2009 is also disposed of accordingly. ## **Sd/-** **SHAJI P. CHALY, JUDGE** dlk/13/6/