Rajani Chaithram v. Joint Registrar of Co-operative Societies (G), Wayand; Assistant Registrar of Co-operative Societies (G), Mananthavady; Panamaram Poultry Farm Processing and Marketing Co-operative Society Ltd; and Addl Respondents 4-9

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** **THE HONOURABLE MR. JUSTICE P.B.SURESH KUMAR** **FRIDAY, THE 16TH DAY OF DECEMBER 2016/25TH AGRAHAYANA, 1938** ## **WP(C).No. 32845 of 2016 (E)** **----------------------------** **PETITIONER(S): --------------------** **RAJANI CHAITHRAM, EDATHUMKUNNU, ANCHUKUNNU P.O., MANANTHAVADY, WAYANAD** **BY ADVS.SRI.B.S.SWATHY KUMAR SMT.ANITHA RAVINDRAN SMT.T.RESHMA SRI.HARISANKAR N UNNI SMT.S.SIKKY** **RESPONDENT(S):** **--------------** **1. THE JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES (G), WAYANAD, PIN- 673 121** **2. THE ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES (G) MANANTHAVADY, WAYANAD-670 645** **3. THE PART-TIME ADMINISTRATOR PANAMARAM POULTRY FARM PROCESSING AND MARKETING COOPERATIVE SOCIETY LTD NO.W.149, PANAMARAM P.O. WAYANAND- 670 721** **Addl R4 - KRISHNAN MATHOTH, AGED 62 YEARS, S/O KALAN VAKAYATT COLONY, ANCHUKUNNU P.O., MANANTHAVADY, WAYANAD DISTRICT,** ## **IMPLEADED AS PER ORDER DATED 25.11.2016 IN IA.NO.16097/2016.** - **Addl R5 - T.K.BHUPESH, AGED 43, S/O BALAGANDHARAN, THURUTHIPALLY HOUSE, PANAMARAM P,O. WAYANAD.** **Addl R6- K.K.PURUSHOTHAMAN, KARIMOMKUNNU, CHERUKATTUR P.O. PANAMARAM, WAYANAD.** **Addl R7 - P.SAROJINI, ANJANNIKUNNU, NEERVARAM.P.O, PANAMARAM, WAYANAD.** **CONTD ---2** **2** ## **Addl R8 - P.RAMACHANDRAN, MATHOTHUPOYIL,** **ANCHUKUNNU P.O, PANAMARM, WAYANAD.** ## **IMPLEADED AS PER ORDER DATED 25.11.2016 IN IA NO.19311/2016.** **Addl R9 - SRI.KESAVAN NAIR E.P., KALATHIL VEEDU, ARICHERI MALA.P.O. MANANTHAVADI, WAYANAD DISTRICT, IS SUO MOTU IMPLEADED AS PER ORDER DATED 25.11.2016.** **Addl R4 to R9 BY ADVS. SRI.M.SASINDRAN SRI.PIRAPPANCODE V.S.SUDHIR R1 to R3 BY SPECIAL GOVERNMENT PLEADER MOHAMMED HASHIM** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 16-12-2016, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** ## **WP(C).No. 32845 of 2016 (E)** **----------------------------** ## **APPENDIX** ## **PETITIONER(S)' EXHIBITS** **------------------------------------** - **EXHIBIT P1 TRUE COPY OF THE ORDER NO.O/3688/16 DATD 4-10-2016 OF THE 1ST RESPONDENT** - **EXHIBIT P2 TRUE COPY OF THE ORDER NO.O/3689/16 DATD 4-102016 OF THE 1ST RESPONDENT** - **EXHIBIT P3 TRUE COPY OF THE ORDER IN WP(C0 NO.32696/2016 DATED 7-10-2016** - **EXHIBIT P4 TRUE COPY OF THE LETTER DATED 1-10-2016 TO THE 2ND RESPONDENT FROM T.K.BHUPESH** ## **RESPONDENT(S)' EXHIBITS** **-------------------------------------** - **EXHIBIT R5(a) :- TRUE COPY OF THE LETTER DATED 10.11.2016 SUBMITTED BY THE 1ST PETITIONER.** - **EXHIBIT R5(b) :- TRUE COPY OF THE LETTER DATED 31.11.2016 SUBMITTED BY THE 2ND PETITIONER.** - **EXHIBIT R5(c):- TRUE COPY OF THE LETTER DATED 10.11.2016 SUBMITTED BY THE 3RD PETITIONER.** **EXHIBIT R5(d) :- TRUE COPY OF THE LETTER DATED 15.11.2016 SUBMITTED BY THE 3RD PETITIONER.** **// TRUE COPY //** **P.A TO JUDGE** **rmm** ## **P.B.SURESH KUMAR, J.** ## **= = = = = = = = = = = = = =** ## **WP(C).No.32845 of 2016-E.** ## **= = = = = = = = = = = = = =** Dated this the 16[th ] day of December, 2016. ## **J U D G M E N T** Ext.P1 order of the first respondent is under challenge in this writ petition. 2. The petitioner is an elected member in the managing committee of Panamaram Poultry Farm Processing and Marketing Co-operative Society Ltd., ('the society'). She is representing the society as its nominee in its central society, viz, Wayanad District Co-operative Bank Ltd. ('the central society') and is an elected member in the managing committee of the said central society also in that capacity. By Ext.P1 order, in exercise of the power under Section 33(1) of the Kerala Co-operative Societies Act ('the Act'), the first respondent has appointed an administrator to manage the affairs of the society, after removing its elected managing committee from office. Ext.P1 order proceeds on the basis that five out of the nine members in the **WP(C).No.32845/2016-E.** 2 managing committee of the society have resigned; that one among the remaining members of the managing committee has expired and that the remaining members in the managing committee cannot constitute the quorum for the meeting of the managing committee. As regards the resignations, it is stated in Ext.P1 order that the members of the managing committee referred to therein have tendered their resignations to the Assistant Registrar concerned and that it is revealed in the enquiry conducted thereafter that they have tendered their resignations. It is alleged by the petitioner in the writ petition that political parties used to get signed blank papers from persons contesting in the elections in their tickets to the societies; that signed blank papers have been collected from the petitioner and other members of the managing committee by the secretary of their party at the time of their election; that the then secretary of their party has now joined the Communist Party of India (Marxist), the political party which is in power in the State and that the resignations allegedly tendered by the members of the managing committee of the society, as indicated in Ext.P1 order, are false documents created using the signed blank papers 3 ## **WP(C).No.32845/2016-E.** obtained from them at the time of election for the purpose of disqualifying the petitioner from holding office as the member of the managing committee of the central society. The petitioner is, therefore, aggrieved by Ext.P1 order. 3. The official respondents have not filed any counter affidavit. 4. A member of the managing committee of the society filed I.A.No.16097 of 2016 seeking orders to implead him as additional fourth respondent in the writ petition. In the affidavit filed in support of the impleading petition, the said member has stated that he has resigned from the managing committee of the society. 5. Heard the learned counsel for the petitioner, the learned Government Pleader as also the learned counsel for the petitioner in I.A.No.16097 of 2016. 6. The learned counsel for the petitioner contended that none of the members in the managing committee of the society have tendered resignations and the resignations claimed to have been tendered by them are false documents created for the purpose of disqualifying the petitioner from holding office as **WP(C).No.32845/2016-E.** 4 the member of the managing committee of the central society. It is also contended by the learned counsel that the Kerala Cooperative Societies Rules ('the Rules') prescribe that resignations are to be tendered to the President of the society and the resignations referred to in Ext.P1 order, even if the same are genuine, should not have been acted upon by the Assistant Registrar, for, the same were not resignations tendered in accordance with the provisions contained in the Rules. Per contra, the learned Special Government Pleader contended that the committee of the society ceased to exist when the resignations were tendered; that when the committee of the society ceased to exist, the President would cease to be the President of the society and therefore there is nothing wrong in the Assistant Registrar accepting the resignations. The learned counsel for the petitioner in I.A.No.16097 of 2016 pointed out that this Court has accepted the resignations submitted before the Assistant Registrar as valid, in **Baby Chemparathy v. Joint Regr.of Co-op.Societies** (2002(2) KLT 730). 7. This Court allowed the writ petition as per the judgment pronounced in open court on 03.11.2016. However, **WP(C).No.32845/2016-E.** 5 before the judgment was signed, it was felt that it is appropriate to hear the members of the managing committee of the society who claimed to have tendered the resignations as well in the matter. Accordingly, the case was posted as 'to be spoken to' on 16.11.2016. When the matter was taken up on the said day, the learned counsel for the petitioner submitted that the said members of the managing committee are taking steps to get themselves impleaded in this matter. In the light of the said submission, the case was adjourned on few occasions to enable the said persons to come on record. On 25.11.2016, it was noticed that only three among the four members of the managing committee who claimed to have tendered resignations have filed impleading petition in the matter. Consequently, the impleading petitions were allowed and the person who did not come forward to get himself impleaded in the proceedings was impleaded _suomoto_ as additional ninth respondent. Since the three members of the managing committee who got themselves impleaded as additional respondents 6 to 8 took the stand that they have not tendered resignations, as per interim order dated 25.11.2016, all the members of the managing committee who claimed to have **WP(C).No.32845/2016-E.** 6 resigned were directed to be present in court on 06.12.2016. The Assistant Registrar who claimed to have received the resignations was also directed to be present in Court as per the said interim order on the said day. Since, 06.12.2016 was a holiday, the matter was taken up on 07.12.2016. On 07.12.2016, the parties except the additional fourth respondent and the additional ninth respondent were present. Additional respondents 6 to 8 who were present in Court reiterated their stand in the impleading petition that they have not tendered their resignations. The Assistant Registrar who was present in Court reiterated the stand in Ext.P1 order that five members of the managing committee of the society have submitted their resignations directly to him. On a specific query from the Court, the Assistant Registrar has stated that he does not know any of the members of the managing committee of the society personally and that it is based on the enquiry conducted by him through the concerned unit inspector that he was satisfied that the persons who have tendered resignations are the members of the managing committee of the society. In the light of the specific stand of the Assistant Registrar, the learned Government **WP(C).No.32845/2016-E.** 7 Pleader has agreed to make available the report claimed to have been submitted by the unit inspector as to the identity of the persons who claimed to have submitted the resignation. Accordingly, the learned Special Government Pleader has made available the report of the unit inspector dated 13.09.2016 on 13.12.2016. A copy of the report of the unit inspector dated 13.09.2016 was taken on record as Exhibit-X1. In the light of the developments as aforesaid after the pronouncement of the judgment, the judgment pronounced in open court on 03.11.2016 was recalled and the learned counsel for the parties were heard again in the matter. 8. Section 33(1) of the Act provides that when the elected managing committee of a society resigns _en bloc_ or where vacancies occur in the committee either by resignation or otherwise and the number of the remaining members cannot constitute the quorum for the meeting of the committee, the Registrar may appoint one administrator or an administrative committee to manage the affairs of the society. Explanation to Section 33(1) of the Act clarifies that for the purpose of the said subsection, a tender of resignation by a member of the **WP(C).No.32845/2016-E.** 8 committee shall have the effect of terminating his membership from the committee. Rule 38 of the Rules dealing with resignation of members in the Managing Committees of Societies, reads thus: ## **Rule 38: Constitution of committee, resignation and removal from membership.** (1) When a committee is constituted under Section 28, the Returning Officer shall inform the details of elections to the State Cooperative Election Commission, forthwith. The Election Commission shall appoint a Presiding Officer to elect the President and other office bearers. The Presiding Officer shall convene the committee within seven days of election to the committee or before the expiry of the term of existing committee, whichever is earlier, and the committee so convened shall elect its president and other office bearers as per Rule 43, and also by resolution authorise the officers concerned to take charge from the outgoing office bearers. (2) A report showing the names and addresses of the members of the committee which has taken charge and date on which they took charge shall be sent to the Registrar, Financing Bank and Circle Co-operative Union by the President of Society, within a week of their taking charge. (3) Any member of a committee, whether elected or nominated may tender his resignation to the President of the committee. (4) The President, on receipt of a resignation, shall within seven days from the date of receipt thereof place it before the **WP(C).No.32845/2016-E.** 9 committee of the society for consideration if the member is an elected person or send it to the authority who nominated the member, if he is a nominee. The resignation shall have effect only from the date of its acceptance by the committee or the authority who nominated the member concerned as the case may be. The fact of its acceptance or otherwise shall also be communicated to the member concerned. In the case of nominees the fact of acceptance or otherwise shall be communicated to the society also. (5) Casual vacancy of an elected member of the committee shall be filled up by election in the manner provided in the rules if the term of office of the board is less than half of its original term, the casual vacancy of an elected member of the committee shall be filled up by nomination by the committee out of the same class of members. In the case of nominated members the vacancies will be filled up by fresh nomination subject to the provisions in R.37. (6) Where the President desires to tender resignation the letter of resignation shall be placed before the committee for consideration.” Rule 38(3) of the Rules categorically provides that the resignation has to be tendered to the President of the committee. When the explanation to Section 33 (1) of the Act clarifies that the serious consequence of terminating the membership from the committee would follow when a member of the committee tenders his resignation, the procedure prescribed for tendering the resignation as contained in Rule 38 (3) of the Rules can be interpreted only as a mandatory provision. If so, the non- **WP(C).No.32845/2016-E.** 10 compliance of the said provision should necessarily invalidate the resignation except in situations where it is impossible to tender resignation as provided for in the said rule. It is all the more so in the light of the principle that where something is required to be done in a particular manner, it should be done only in that manner or not at all, and all other modes are necessarily forbidden. In **Sadasivan v. Joint Registrar** (1994(2) KLT 238), this Court had already taken the said view. It is seen that in **Deputy Registrar of Co-operative Societies v. George** (1974 KLT 189), this Court held in the context of the resignation of two nominated members from the managing committee of a society that since the authority nominated them being the authority competent to accept their resignations and since Rule 38(4) provides that the resignation shall be placed before that authority and shall be effective only from the date of acceptance of the same by such authority, the said rule can be regarded only as directory and not mandatory and that non-conformity of the requirement in Rule 38 (3), would not invalidate the resignation. The reasons on the basis of which the Division Bench of this Court held in the said case that Rule 38 (4) of the Rules is **WP(C).No.32845/2016-E.** **==> picture [13 x 9] intentionally omitted <==** only directory, do not apply to a case of resignation by the elected members of the society. As far as the resignations tendered by elected members in the managing committee are concerned, this Court has held in in **Nataraj Gownder v. Registrar** (2008 (2) KLT 335) that Rule 38 (4) of the Rules, to the extent it provides that the resignation shall have effect only from the date of its acceptance by the committee, is _ultra vires_ of _S_ ection 33 (1) of the Act and is void. The decision of the Division Bench referred to in the said case, in the circumstances, cannot have any application to a case of resignation of the elected member/members in the managing of a society. As far as the present case is concerned, the persons who claimed to have tendered resignations are elected members of the managing committee of the society. It is conceded that the resignation letters referred to in Ext.P1 order are not resignation letters tendered in accordance with Rule 38(3) of the Rules, for, the same have not been tendered to the President of the society. The respondents have no case that compliance of the requirement of Rule 38(3) of the Rules was impossible. In the circumstances, I have no hesitation to hold that the first **WP(C).No.32845/2016-E.** 12 respondent has acted illegally in passing Ext.P1 order relying on the resignations claimed to have been tendered otherwise than in accordance with the provisions contained in the Rules. 9. As noted above, the contention of the learned Special Government Pleader is that the committee of the society ceased to exist when the resignations were tendered and when the committee of the society ceased to exist, the President would cease to be the President of the society and therefore there is nothing wrong in the Assistant Registrar accepting the resignations. It is seen that this Court in **Sadasivan v. Joint Registrar** (1994(2) KLT 238), has dealt with the said contention and repelled the same. Paragraph 16 of the judgement in the said case reads thus; 16. The explanation offered by the respondents that the committee had ceased to exist when once the number of members got reduced below the quorum and therefore there was no President to whom the resignation could be tendered is not capable of acceptance. For one thing, it is not possible for a member of the committee when he resigns to know whether the quorum has got reduced below the limit or not. Secondly, there is no automatic termination of the term of the committee even when it ceases to have quorum. No such automatic cesser of the term is provided anywhere in the Act or the Rules. What S. 33 does is to provide aground for the Registrar to supersede a 13 ## **WP(C).No.32845/2016-E.** committee in cases where the number of remaining members cannot constitute the quorum for a meeting of the committee. In that event, the Registrar has to act in the manner provided in the section and pass an order either suo motu or on application of any member of the society, and after intimating the Circle Cooperative Union about it, appointing either a new committee or one or more administrator or administrators to manage the affairs of the society. Unless and until the Registrar acts in the manner provided in S. 33, the remaining members of the committee do not cease to be members of that committee, though they may not be in a position to act or transact business without the necessary quorum, except carrying on the day to day administration. The Act does not envisage a vacuum in the management of a co-operative society. Either a managing committee is there or an administrator comes in its place - there is no hiatus. That will be the result, if. there is an automatic cesser of the office of the managing committee as soon as its membership gets reduced below the quorum. A necessary concomitant of this conclusion is that the President of the committee does not cease to be its President, merely because the number of members got reduced below the quorum. The fact that he cannot place it before the committee under Rule 38(4) cannot lead to a contrary conclusion because the requirement of placing before the committee is only for informing it about the resignation and not for any other purpose, as the Act or the Rules do not require the committee to accept the resignation. It takes effect the moment it is tendered in accordance with Rule 38(3) to the President Therefore, the tender of the resignation (assuming that it is a true one) by the second petitioner to the Assistant Director (Dairy) was not in accordance with law, and was not a valid resignation, which takes effect eo instanti.” ## I am in respectful agreement with the aforesaid view. **WP(C).No.32845/2016-E.** 14 10. The learned counsel for the additional fourth respondent contended that the present stand of respondents 6 to 8 in this matter is irrelevant, for, if they had in fact submitted resignations, the legal consequences of the same cannot be altered. True, if respondents 6 to 8 had submitted resignations, the legal consequences the same cannot be altered. But, at the same time, if they had not submitted resignations, it is highly unjust and unfair to remove them from the management of the society on the basis of the alleged resignations. Therefore, it is necessary to examine prima facie whether the so-called resignations are resignations tendered by respondents 6 to 8. As noted above, what is stated in Ext.P1 order is that five members of the managing committee of the society have tendered their resignations to the Assistant Registrar. The Assistant Registrar does not know the said members of the managing committee personally. It is on account of said reason that he caused an enquiry to be made as to the identity of the persons concerned through the unit inspector. The report of the unit inspector which is part of the records, does not indicate that he was satisfied with the identity of the persons who claimed to have tendered the **WP(C).No.32845/2016-E.** 15 resignations. Apart from the unilateral statement made by the Assistant Registrar in his report to the Joint Registrar, there is no material to infer that additional respondents 6 to 8 are the persons who have submitted the resignations relied on in Ext P1 order. The minutes book of the managing committee of the society which was also made available by the learned Special Government Pleader at the time of hearing indicates that the persons involved in this matter are rustic villagers who do not have consistent signatures even. The said fact is not disputed by the learned counsel for the additional fourth respondent also. Comparison of signatures cannot also be made in this matter to satisfy the identity of the parties. In the circumstances, I am of the view that it is unsafe to rely on the resignations claimed to have been received by the Assistant Registrar to supersede the elected managing committee of the society. 11. The argument advanced by the learned counsel for the additional fourth respondent, relying on the decision of this Court in **Baby Chemparathy's case** _(supra) is_ also liable to be rejected, for, what is stated in the said case is only that violation of the procedure provided for in Rule 38(3) of the Rules **WP(C).No.32845/2016-E.** 16 cannot invalidate the resignation, if the act of resignation is not in dispute. The said decision may not have any application to the facts of the present case, for, this is not a case where the act of resignations is not in dispute. In the result, the writ petition is allowed and Ext.P1 is quashed. The management of the society shall be returned forthwith to the managing committee of the society by the part time administrator appointed pursuant to Ext.P1 order, if the management of the society has been taken over pursuant to Ext.P1 order. _**Sd/-**_ **P.B.SURESH KUMAR, JUDGE.** _**Kvs/-**_ _**// true copy //**_