P.S. Chandrika v. Vijayamohini Mills Employees Co-operative Credit Society Ltd

**IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT:** **THE HONOURABLE MR. JUSTICE SHAJI P.CHALY WEDNESDAY, THE 6TH DAY OF DECEMBER 2017/15TH AGRAHAYANA, 1939** **WP(C).No. 29486 of 2017 (I) -------------------------** **PETITIONER:** - **----------** **P.S.CHANDRIKA, SECRETARY (UNDER SUSPENSION), VIJAYAMOHINI MILLS EMPLOYEES CO-OPERATIVE CREDIT SOCIETY LTD.,NO.T.390, THIRUMALA, THIRUVANANTHAPURAM-695006.** **BY ADVS.SRI.V.G.ARUN SRI.T.R.HARIKUMAR** **RESPONDENTS:** - **-----------** **1. THE VIJAYAMOHINI MILLS EMPLOYEES CO-OPERATIVE CREDIT SOCIETY LTD NO.T.390, REPRESENTED BY ITS PART-TIME ADMINISTRATOR, THIRUMALA, THIRUVANANTHAPURAM.695006. (UNIT INSPECTOR, SREEKARYAM, OFFICE OF THE ASSISTANT REGISTRAR(GENERAL) OF CO-OPERATIVE SOCIETIES, THIRUVANANTHAPURAM).** **2. THE PART-TIME ADMINISTRATOR, VIJAYAMOHINI MILLS EMPLOYEES CO-OPERATIVE CREDIT SOCIETY LTD NO.T 390, THIRUMALA, THIRUVANANTHAPURAM-695006, (UNIT INSPECTOR, SREEKARYAM, OFFICE OF THE ASSISTANT REGISTRAR (GENERAL) OF CO-OPERATIVE SOCIETIES, THIRUVANANTHAPURAM).** **3. THE ASSISTANT REGISTRAR(GENERAL) OF CO-OPERATIVE SOCIETIES, THIRUVANANTHAPURAM.695001.** **4. THE JOINT REGISTRAR (GENERAL) OF CO-OPERATIVE SOCIETIES, THIRUVANANTHAPURAM. 695001.** **5. THE REGISTRAR OF CO-OPERATIVE SOCIETIES, THIRUVANANTHAPURAM.695001.** **R1 & R2 BY ADVS. SRI.S.JUSTUS** **SRI.T.SHIHABUDEEN R3 & R5 BY SPL. GOVERNMENT PLEADER SRI.MOHAMMED HASHIM K.S.** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 29.11.2017, THE COURT ON 06.12.2017 DELIVERED THE FOLLOWING:** **EL** **WP(C).No. 29486 of 2017 (I) ----------------------------** ## **APPENDIX** |**PETITIONER(S)'**|**EXHIBITS**| |---|---| |**-----------------------**|| |**EXHIBIT P1**|**A TRUE COPY OF THE RECEIPT DATED 16.5.2017 ISSUED BY THE 2ND**| ||**RESPONDENT.**| |**EXHIBIT P2**|<br>**A TRUE COPY OF THE RECEIPT DATED 20.5.2017 ISSUED BY THE 2ND**| ||**RESPONDENT.**| |**EXHIBIT P3**|<br>**A TRUE COPY OF THE ORDER DATED 16.8.2017 ISSUED BY THE 2ND**| ||**RESPONDENT.**| |**EXHIBIT P4**|<br>**A TRUE COPY OF THE RELEVANT PAGES OF THE BYLAWS OF THE 1ST**| ||**RESPONDENT SOCIETY.**| |**RESPONDENT(S)'**|**EXHIBITS**| |**-----------------------**|| |**EXHIBIT R2(A)**|**TRUE COPY OF THE FIR IN CRIME NO.1913/2017 OF POOJAPPURA**| ||**POLICE STATION**| |**EXHIBIT R3(A)**|**TRUE COPY OF THE ORDER DATED 17.10.2017**| **TRUE COPY** **P.S. TO JUDGE** **EL** ## **SHAJI P. CHALY, J.** -------------------------------------------------- ## **W.P.(C) No.29486 of 2017 ----------------------------------------------Dated this the 6[th] day of December, 2017** ## **JUDGMENT** Petitioner was appointed as the Secretary of the 1[st] respondent society in the year 1983, and has been functioning in that post for more than 33 years. The affairs of the society was being managed by a 11 member managing committee till January, 2016, when the committee was superseded for want of quorum and a Part-time Administrator appointed in its place. According to the petitioner, the 2[nd] respondent has been on inimical terms with the petitioner right from the day on which the 2[nd] respondent took charge as Part-time Administrator. It is also contended that, since the petitioner failed to accede to the demands of the 2[nd] respondent, petitioner was placed under suspension as per Ext.P3 order. 2. The contention of the petitioner is that, Ext.P3 order issued by the 2[nd] respondent is without jurisdiction, since his term as an Administrator was not extended, and further that, the order was issued stating reasons for which the petitioner is not liable in any manner. With the aforesaid facts on the 2 **W.P.(C) No.29486 of 2017** ## background, petitioner has sought for the following reliefs: _“i) To issue a writ of certiorari calling for the records leading to the issuance of Ext.P3 and quash the same;_ _ii) To issue a writ of mandamus or any other appropriate writ, order or direction, directing the 2[nd] respondent to reinstate the petitioner in the service of the 1[st] respondent society, forthwith; and_ _iii) To grant such other reliefs as this Honourable Court may deem fit in the circumstances of this case.”_ 3. Respondents 1 and 2 have filed a detailed counter affidavit, disputing the allegations and claims and demands raised by the petitioner. Among other contentions, it is stated that, due to the resignation of the committee members of the 1[st] respondent society, the Administrator took charge of the society on 31.03.2016, and thereafter the service of the Administrator had been extended for every six months as per the Government Orders. 4. It is submitted that, necessary directions were issued to the petitioner who was the Secretary of the above said society for production of Minutes Book for taking charge as Administrator as per order dated 12.02.2016. But the petitioner did not act in accordance with the directions, and hence a memo was issued to the petitioner to produce the Minutes Book. In spite of the same, petitioner did not comply 3 **W.P.(C) No.29486 of 2017** with the above directions, and thereupon the Administrator took charge of the society by introducing a new Minutes Book. 5. Several complaints were received, since the Administrator took charge of the society in respect of repayment of outstanding loan amounts. Thereupon, several intimations and directions were issued to the Secretary to hand over the registers and records including Loan Register, Loan file, Daily Registers, Minutes Book etc. etc. But, all the attempts of the Administrator went futile. It is also stated, as per an order dated 26.04.2017, Circle Inspector of Police, Poojappura Police Station was appointed to seize the records of the society. In the meanwhile, various complaints were received against the maladministration on the part of the petitioner. However, due to compulsion, certain records were produced by the petitioner, and going through the records, it is revealed that, petitioner had given loan and financial assistance even to non-members as well, amounting to Rs.30,35,000/- to 26 non-members, and had disbursed loans to several persons in fake addresses as well. 6. In accordance with the seizure of records as per order dated 05.08.2017, a unit wing was constituted under the 4 **W.P.(C) No.29486 of 2017** supervisory head of Palayam Unit Inspector to seize the records of the society, and in that process, some of the records could be retrieved. However, Minutes Book, loan transaction registers and books were not traced out and are purposefully concealed by the petitioner. The Joint Registrar had, accordingly, ordered enquiry against the petitioner under Sec.65 of the Kerala Co-operative Societies Act, 1969, and the investigation is still in progress. It is also stated that, Crime No.1913/2017 is registered by the Poojappura Police Station, Thiruvananthapuram against the petitioner and others, alleging offences under Sec.409 and 420 read with Sec.34 of IPC, evident from Ext.R2(a). Therefore, according to the 1[st] and 2[nd] respondents, petitioner is not entitled to get any reliefs as is sought for in the writ petition. 7. The third respondent has also filed a detailed counter affidavit almost on similar lines, and according to the 3[rd] respondent also, the contention advanced by the petitioner in respect of lack of power for the 2[nd] respondent, to impose the order of suspension on the petitioner, cannot be sustained in view of extension granted by the State Government to the Administrator, to continue, with effect from 01.04.2017 to **W.P.(C) No.29486 of 2017** 5 30.09.2017, evident from Ext.R3(a) order dated 17.10.2017. 8. It is further submitted, before the expiry of the period provided to the Administrator, an application was forwarded to extend the period, and therefore, when the action was taken against the petitioner as per Ext.P3 order dated 16.08.2017, 2[nd] respondent was under the helm of affairs of the 1[st] respondent society, and therefore, it cannot be said that the 2[nd] respondent did not have power to issue the order. Other contentions are also raised justifying issuance of Ext.P3 order by the 2[nd] respondent. 9. I have heard learned counsel for the petitioner, learned counsel appearing for respondents 1 and 2, and the learned Special Government Pleader appearing for respondents 3 to 5. Perused the documents on record and the pleadings put forth by the respective parties. 10. The sole question remains to be considered in this writ petition is, whether the 2[nd] respondent did have power in issuing Ext.P3 order suspending the petitioner. The main contention advanced by learned counsel for the petitioner is, since the term of the 2[nd] respondent expired on 31.03.2017, the 2[nd] respondent did not have any power at all to suspend **W.P.(C) No.29486 of 2017** 6 the petitioner as per Ext.P3 order dated 16.08.2017. According to the learned counsel, even though Government have issued Ext.R3(a) order dated 17.10.2017, giving retrospective operation from 01.04.2017, the action taken by the 2[nd] respondent against the petitioner cannot be sustained, since, while issuing Ext.P3 order, there was no order enabling the 2[nd] respondent to administer the affairs of the society, and there is no power vested with the Government to grant retrospective operation to the appointment. 11. In that regard, learned counsel has invited my attention to the judgment of the apex court in _**'Strawboard Manufacturing Company Ltd. v. Gutta Mill Workers' Union'**_ [AIR 1953 SC 95], and specifically to paragraphs 5 and 6 of the said judgment, which read thus: “5. _Learned counsel for the respondents refers us to the provisions of S. 14 of the U. P. General Clauses Act, 1904 which provides that where by any Uttar Pradesh Act any power is conferred on the State Government then that power may be exercised from time to time as occasion requires. Sections 3 and 4 of the U. P. Industrial Disputes Act, 1947 certainly confer power on the State Government to refer disputes to an adjudicator for decision and S. 6 (1) may be read as empowering the State Government to specify the time within which the adjudicator to whom an industrial dispute is referred for adjudication is to submit his award. The combined effect of S. 14 of the U. P. General Clauses Act and S. 6(1) of the G. P. Industrial Disputes Act, 1947, it is contended, is that the_ **W.P.(C) No.29486 of 2017** 7 _adjudicator is enjoined to submit his report "within such time as may from time to time be specified" and that this being the position, the principles laid down in the English decisions referred to above must be held to be applicable to the present case._ _We are unable to accept this line of reasoning. Under S. 14 of the U. P. General Clauses Act the State Government may exercise the power conferred on it by Ss. 3, 4 and 6, that is to say, it can from time to time make orders referring disputes to an adjudicator and, whenever such an order of reference is made, to specify the time within which the award is to be made. This power to specify the time does not and indeed cannot include a power to extend the time already specified in an earlier order. The legislative practice, as evidenced by the provisions of the different statutes referred to above, is to expressly confer the power of extension of time, if and when the Legislature thinks fit to do so. There is no question of any inherent power of the Court and much less of the Executive Government in this behalf. Section 14 of the U.P. General Clauses Act does not in terms, or by necessary implication, give any such power of extension of time to the State Government and, therefore, the respondents can derive no support from that section._ _6. Learned advocate for the Intervener, the State of Uttar Pradesh, draws our attention to section 21 of the U. P. General Clauses Act 1904, and contends that the order of 26-4-1950 should be taken as an amendment or modification, within the meaning of that section, of the first order of 18-2-1950. It is true that the order of 26-4-1950 does 'ex facie' purport to modify the order of 18-2-1950 but, in view of the absence of any distinct provision in S. 21 that the power of amendment and modification conferred on the State Government may be so exercised as to have retrospective operation the order of 26-4-1950 viewed merely as an order of amendment or modification, cannot, by virtue of S. 21, have that effect. If, therefore, the amending order operates prospectively, i. e. only as from the date of the order, it cannot validate the award which had been made after the expiry of the time specified in the original order and before the date of the amending order, during which period the adjudicator was, functus_ 8 **W.P.(C) No.29486 of 2017** _officio' and had no jurisdiction to act at all. We do not think the respondents can derive any support from S. 21 of the U. P. General Clauses Act.”_ 12. Learned counsel has also invited my attention to the ## judgment of this Court in _**'Calicut-Wynad Motor Service (Private) Ltd. v. State of Kerala'**_ [1959 KLT 521], and paragraph 4 read thus: _“4. The next aspect is how far the subsequent Government Notification is helpful to the respondents. It is not claimed for the respondents in this connection that the Government passed the Notification in the exercise of any legislative power delegated to them under the Act. The Notification is merely an executive order purporting to provide a period of appointment for the members retrospectively. The rule is well-settled that even in a case where the executive Government acts as a delegate of a legislative authority, it has no plenary power to provide for retrospective operation unless and until that power is expressly conferred by the parent enactment. See e.g. ML. Bagga v. Murhar Rao, AIR 1956 Hyd. 35, 38 where it was held:-_ _“the rule-making authority does not possess plenary power to give the subordinate delegated legislation retrospective operation unless and until that power is expressly conferred by the parent enactment.”_ _Similarly in Modi Food Products v. Commr. Sales-Tax, AIR. 1956 All. 35. 39 the learned Judges held:_ _“A legislature can certainly give retrospective effect to pieces of legislation passed by it but an executive Government exercising subordinate and delegated powers, cannot make legislation retrospective in effect unless that power is expressly conferred”._ _The difficulty must certainly be greater where as here it is a mere executive power that is exercised. Reference in this connection may be made to Strawboard Mfg. Co. v. G. Mill Workers’ Union AIR 1953 SC 95, where the_ 9 **W.P.(C) No.29486 of 2017** _question was as to the validity of an order of the Government extending the time for the passing of an award after it had been actually passed. Said the learned Judges:_ _“The State Government has not the power to extend the time for making an award ‘expost facto’ i. e. after the time limit originally fixed therefor has expired.”_ _In this case, the members of the RTA have already acted without authority when the Government sought to intervene with their second Notification. The second Notification could in the circumstances serve no useful purpose.”_ Therefore, according to the learned counsel, since the 2[nd] respondent was not armed with any power at the time of issuance of Ext.P3 order, the same is liable to be interfered with and quashed. 13. On the other hand, learned Special Government Pleader as well as the learned counsel appearing for respondents 1 and 2 have invited my attention to Sec.33 of the KCS Act, 1969, wherein, power is conferred on the Registrar to constitute Administrator or Administrative Committee in the place of the managing committee. My attention was invited specifically to sub-sections (1A), 2 and 3 of Sec.33, which read thus: _“(1A) Notwithstanding anything contained in sub-section (1), where on receipt of a report from the Registrar, the Government is satisfied that a new committee cannot be constituted or cannot enter upon_ 10 **W.P.(C) No.29486 of 2017** _office of the society before the expiry of the term of office of the administrator or administrative committee, as the case may be, appointed by the Registrar under sub-section (1) and that it is necessary in the public interest to manage the affairs of the society and to enable a new elected committee to enter upon office, the Government may, by notification in the Gazette, for reasons to be recorded, permit the Registrar to extend the term of the said administrator or administrative committee, as the case may be, for a further period not exceeding one year in the aggregate or till a new committee enters upon office, whichever is earlier._ _(2) The administrator or administrative committee appointed under sub-sections (1) & (1A) shall, subject to the control of the Registrar and to such instructions as he may from time to time give, have power to exercise all or any of the powers and functions of the committee or of any officer of the society and take all such action as may be required in the interest of the society._ _(3) The administrator or administrative committee shall arrange for the constitution of a new committee or for the entering upon office of the new committee, as the case may be.”_ 14. According to the learned Special Government Pleader, the intention of appointing the administrator in the place of the managing committee is to manage the affairs of the society, failing which, the day-to-day affairs of the society will be in trouble. It is also submitted that, once an administrator is appointed to manage the affairs of the society, the administrator will have to continue with the management till such time the statute permits, or an election is conducted **W.P.(C) No.29486 of 2017** 11 and the new managing committee takes charge of the affairs of the society. It is also contended that, well within the period, the Registrar had submitted a report before the Government seeking extension of the period of the administrator, which was pending consideration, and merely because no orders were passed, it cannot be said that the administrator is not vested with powers to continue with the management of the society. 15. I have considered the rival submissions and evaluated the situation. It is an undisputed fact that an administrator is appointed to manage the affairs of the society with the intention of avoiding any stalemate in the absence of managing committee. Petitioner has no case that the period as is statutorily prescribed has elapsed, so as to disable the administrator from managing the affairs of the society. It is evident from Ext.R3(a) order that the Government have directed the Registrar to extend the period of the administrator for a period of six months from 01.04.2017 to 30.09.2017, or till a new managing committee enters upon office. Therefore, when Ext.R3(a) order is passed by the State Government, it is to be legally presumed that the said order was passed based 12 **W.P.(C) No.29486 of 2017** on suitable report submitted by the Registrar in accordance with sub-section (1A) of Sec.33. 16. There are no enabling documents, or established evidence, produced by the petitioner before this Court to show that no report was submitted by the Registrar, enabling the Government to act upon it. No doubt, the Government is a busybody, and therefore, there will be reasonable delay on the part of the Government to act on such a report submitted by the Registrar. Moreover, the administrator is appointed with the avowed object of safeguarding the interest of the society, especially the financial part. It is also alleged that the petitioner has acted aversely to the interest of the 1[st] respondent society. Anyhow, since these are all subject matters in the pending enquiry proceedings, I do not wish to express any opinion on the merits of the issue raised against the petitioner. 17. Be that as it may, I am of the considered opinion that, since Ext.R3(a) order is passed by the State Government, extending the period of the 2[nd] respondent from 01.04.2017 onwards, the action taken by the 2[nd] respondent against the petitioner is ratified on the passage of the order by the State 13 **W.P.(C) No.29486 of 2017** Government if at all it had any deficiency. Petitioner also is not having a case that the continuance of the 2[nd] respondent as administrator in the society is challenged by the petitioner before any statutory authority, at any point of time. 18. Taking into account the larger interest of the 1[st] respondent society and also taking into account the order passed by the State Government empowering the 2[nd] respondent to continuously act from 01.04.2017, consequent to the expiry of the period on 31.03.2017, Ext.P3 order cannot be said to be bad or illegal in any manner. If a view is adopted otherwise than as above, it will lead to disastrous consequences, interfering with the best interest of the members of the society and the society at large. Moreover, conferment of power under law, is to have continuous administration so as to avoid any adverse consequences to the society. So also, it is with good intentions, the State legislature have foreseen the absence of managing committee, and incorporated provisions under the statute, to have stop gap arrangements by appointing administrator or administrative committee to tide over such situations. Therefore, predominance is to be given to the management of 14 **W.P.(C) No.29486 of 2017** the affairs of the society in a fair, just and equitable manner. Above all, petitioner is only suspended for the purpose of carrying on with the enquiry so as to unravel the truth in respect of the allegations, and in that process and before culmination, sufficient opportunity will be provided to the petitioner to prove her innocence. 19. However, the consideration in the judgments quoted _supra_ , was with respect to the power conferred on the statutory authority to decide dispute, and also absence of power to provide retrospective operation, respectively. Such circumstances are not available, to the factual background raised in this writ petition. So also, every power is conferred under Sec.33(1)(b) of the Act, for the continuance of the administrator for a period of one year and for a further period of one year as per sub-section (1A) of Sec.33. Therefore, it cannot be heard to say that there is no power for the 2[nd] respondent to suspend the petitioner pending enquiry, especially when the action gets ratified under law. 20. To put it otherwise, in the afore-quoted judgments, the issue was with respect to lack of power under any statute. However, such a factual and legal situation is not existing in 15 **W.P.(C) No.29486 of 2017** the writ petition to have a successful challenge against Ext.P3 order of suspension. Therefore, I do not find any reason to interfere with Ext.P3 order, there being no illegality, arbitrariness, unfairness or any other legal infirmities, justifying interference under Article 226 of the Constitution of India. Resultantly, the writ petition is dismissed, leaving open the liberty of the petitioner to raise all other issues in the enquiry proceedings. Sd/- **SHAJI P. CHALY JUDGE** St/30.11.2017