WA Nos. 1779, 1781 & 1802 of 2013 in WP(C) 17672/2013

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT:** **THE HONOURABLE MR.JUSTICE ANTONY DOMINIC & THE HONOURABLE MR. JUSTICE ANIL K.NARENDRAN** **THURSDAY, THE 6TH DAY OF MARCH 2014/15TH PHALGUNA, 1935** **WA.No. 1779 of 2013 () IN WP(C).17672/2013 --------------------------------------------** **AGAINST THE ORDER/JUDGMENT IN WP(C) 17672/2013 of HIGH COURT OF KERALA DATED 21/11/13** ## **APPELLANT(S)/ADDITIONAL 5TH RESPONDENT:** **----------------------------------------------------------------------------** **N.SUDARSANAN AGED 65 YEARS S/O.NANU, RESIDING AT CHITHAVIL HOUSE, KILIMANOOR P.O. THIRUVANANTHAPURAM DISTRICT.** **BY ADVS.SRI.RAJU JOSEPH (SR.) SRI.J.JULIAN XAVIER SRI.K.T.POULOSE (KORATTY)** ## **RESPONDENT(S)/PETITIONER AND RESPONDENTS 1 TO 4:** **------------------------------------------------------------------------------------------------** ## **1. BENNY PERUVANTHANAM** **THURUTHIPPALLIYIL HOUSE, MURINJAPUZHA PO IDUKKI 685 532.** ## **2. KERALA STATE CO-OPERATIVE CONSUMERS' FEDERATION LIMITED** **REPRESENTED BY ITS MANAGING DIRECTOR, GANDHI NAGAR ERNAKULAM, KOCHI 682 020.** ## **3. THE REGISTRAR OF CO-OPERATIVE SOCIETIES THIRUVANANTHAPURAM-695001.** ## **4. JOY THOMAS** **THUNDATHIL HOUSE, ARAKKULAM, IDUKKI DISTRICT 685 591.** ## **5. STATE OF KERALA** **REPRESENTED BY ITS SECRETARY CO-OPERATION (B) DEPARTMENT, SECRETARIAT THIRUVANANTHAPURAM-695001.** **BY SPL.GOVERNMENT PLEADER SRI.D.SOMASUNDARAM R2 BY SRI.JOY GEORGE BY SRI.P.RAVINDRAN (SR.) BY SRI.A.SUDHI VASUDEVAN** **THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 06-03-2014, ALONG WITH WA. 1781/2013 &, WA. 1802/2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **ANTONY DOMINIC & ANIL K. NARENDRAN, JJ. ============================== Writ Appeal Nos. 1779, 1781 & 1802 of 2013 ===============================** ## **Dated this the 6[th] day of March, 2014** ## **J U D G M E N T** ## Antony Dominic, J. The writ appeals are filed by the additional 5[th] respondent, 3 respondent and additional 4[th] and 2[nd] respondents respectively in WP(C) No.17672/13, who are aggrieved by the judgment of the learned Single Judge allowing the said writ petition filed by the 1[st] respondent in WA Nos.1779 and 1802/13. 2. Briefly stated, the facts of the case are that the Kerala State Co-operative Consumers Federation Limited is an Apex Society and the appellants in WA Nos.1779 & 1781/13 were nominated to the Board of Directors of the Society on 13/7/11. They were thereafter elected as the Vice President and President respectively. While they were so continuing in the respective posts, Section 31 of the Kerala Co-operative Societies Act was amended by Kerala Co-operative Societies (Amendment) Act, 2013 (Act 8 of 2013). By Section 17 of Act 8 of 2013, sub section 2A was introduced to the said section. Section 31 after amendment read as follows; W.A. Nos. 1779, 1781 & 1802 of 2013 ## **: 2 :** ## _**31. Nominees of Government on committee of an apex or a Central society.** - (1) Where the Government --_ _(a) have subscribed to the share capital of an apex or a central society; or_ _(b) have assisted indirectly in the formation or augmentation of the share capital of an apex or a central society; or_ _(c) have guaranteed the repayment of principal and payment of interest on debentures issued by an apex or a central society; or_ _(d) have guaranteed the repayment of principal and payment of interest on loans and advances to an apex or a central society;_ _[the government or any other authority shall have the right to nominate not more than two persons to the committee of an Assisted, Apex or Central Society]_ _(2) A person nominated to the committee of an apex or a Central society under sub-section (1) shall hold office during the pleasure of the Government or the specified authority, as the case may be._ _{(2A) The person nominated under sub-section (1) shall not be eligible to hold the office of the President/Chairman or Vice-President/Vice Chairman of the Apex or Central society nor will be_ W.A. Nos. 1779, 1781 & 1802 of 2013 **: 3 :** _eligible for being sent as the delegate of the Apex or Central Society.}_ _(3) A person nominated to the committee of an apex or a Central society under sub-section (1) shall not take part in the discussion of any noconfidence motion or vote on any such motion._ 3. Subsequently, on 21/6/13, Government of Kerala, the first appellant in WA No.1802/13, issued Ext.P8 order in exercise of the powers under Section 101 of the Kerala Co-operative Societies Act and exempting all the Apex or Central Societies where the persons nominated under Section 31 of the Act before the commencement of Act 8 of 2013 still continue as nominated members in the committee and hold the office of the President/Chairman or Vice President/Vice Chairman of the Societies so as to enable such societies to allow all the nominated persons in the Committee and to continue the nominated persons as office bearers w.e.f. 14/2/13 till the expiry of their tenure or Government/Registrar withdraws the nomination, whichever is earlier. The operative portion of the order reads thus; _NOW THEREFORE, in exercise of the powers conferred by section 101 of the Kerala Co-_ W.A. Nos. 1779, 1781 & 1802 of 2013 **: 4 :** _operative Societies Act, 1969 (2) of 1969), the Government of Kerala hereby exempt all the Apex or Central Societies where the persons nominated under section 31 of the said Act, by_ _the government/Registrar of Co-operative Societies before the commencement of Kerala Co-operative Societies (Amendment) Act, 2013 (8 of 2013) still continue as nominated members in the committee and hold the office of the president/chairman or vice president/vice chairman of the Apex or Central Societies so as to enable such societies to allow all the nominated persons in the committee and to continue the nominated persons as office bearers with effect from 14[th] February, 2013 till the tenure of the existing committee expires, or till the Government/Registrar withdraws the person from the committee as the case may be, whichever is earlier.”_ It is on the issuance of Ext.P8, the 1[st] respondent in WA Nos.1779/13 and 1802/13, who has also been impleaded as 5[th] respondent in WA No.1781/13, filed the writ petition with the prayer to quash Ext.P8 by the issuance of a writ of certiorari. ## W.A. Nos. 1779, 1781 & 1802 of 2013 **: 5 :** 4. The appellants contested the case and after hearing them, the learned Single Judge by judgment dated 21[st] of November, 2013 disposed of the matter upholding the power of the Government to issue orders of exemption but holding that Section 101 of the Kerala Co-operative Societies did not authorise the Government to issue any exemption with retrospective effect. In view of the finding that there is no power to grant retrospective exemption, the learned Judge quashed Ext.P8 and allowed the writ petition. It is this judgment, which is under challenge before us. 5. We heard the learned senior counsel appearing for appellant in WA No.1779/13, learned Special Government Pleader appearing for the appellants in WA No.1802/13 and the learned counsel appearing for the appellant in WA 1781/13. On behalf of the writ petitioner, the 1[st] respondent in WA Nos.1779/13 and 1802/13, we heard the learned senior counsel also. 6. Although detailed arguments were advanced, according to us, the findings of the learned Single Judge in so far as the power to exempt societies under Section 101 of the Kerala W.A. Nos. 1779, 1781 & 1802 of 2013 **: 6 :** Co-operative Societies Act and the absence of power to grant retrospective exemption are concerned, deserve to be upheld. But, such findings could not have resulted in unseating the appellants in WA Nos.1779/13 and 1781/13, because long before Act 8 of 13 was legislated, the appellants who were nominated members of the Board of Directors of the Apex Society were already elected as Vice President and President respectively for a tenure of five years. In such a situation, if by virtue of a later enactment, the rights of the appellants as President and Vice President are to be affected in any manner, the legislation which is brought into force should have retrospective effect and such retrospectivity should be evident either expressly or impliedly in provisions of the amended Act. 7. In so far as these cases are concerned, Section 1 of Act 8 of 2013 reads thus; _1. Short title, extent and commencement - (1) This Act may be called the Kerala Co-operative Societies Act, 1969._ _(2) It extends to the whole of the State of Kerala._ W.A. Nos. 1779, 1781 & 1802 of 2013 **: 7 :** _(3) It shall come into force on such date as the Government may, by notification in the Gazette appoint._ _Provided that different dates may be appointed for different provisions of this Act and any reference in any such provision to the commencement of this Act shall be construed as a reference to the coming into force of that provision._ Therefore, there is nothing in the Act which gives any retrospectivity to the provisions of the Act and in such a situation, the accrued rights of the appellants as President and Vice President of the Apex Society could not have been taken away by such a prospective enactment. 8. This view that we have taken is fully supported by the principles laid down by the Apex Court in _**J.S.Yadav v. State of Uttar Pradesh and another**_ {(2011) 6 SCC 570}. That was a case where the appellant who was a District Judge was appointed as a member of U.P State Human Rights Commission. On his appointment, he joined the said post on 1/7/2006. Subsequently, the Act was amended, which provided that a District Judge with 7 W.A. Nos. 1779, 1781 & 1802 of 2013 **: 8 :** years service alone shall be eligible for appointment and the amendment came into force on 23/11/2006. On 28/5/2008, the Sate of U.P. issued a notification to the effect that the appellant ceased to hold office as member of the Commission. This notification was challenged before the High Court. The High Court dismissed the writ petition and the judgment was challenged in the Apex Court. In this judgment, upholding the contentions of the appellant therein that the amending Act being prospective, his rights as a member of the Human Rights Commission could not have been affected, the Apex Court held thus; _26. In the instant case, the Amendment Act, 2006 is not under challenge. However, the issue agitated by the appellant has been that the Legislature never intended to apply the amended provisions with retrospective effect and therefore, the appellant could not be discontinued from the post. His rights stood protected by the provisions of Section 6 of the Act, 1897.The issue of applicability of the said provision has been considered by this Court in State of Punjab v. Mohar Singh Pratap_ W.A. Nos. 1779, 1781 & 1802 of 2013 **: 9 :** _Singh, AIR 1955 SC 84; M.S. Shivananda v. The Karnataka State Road Transport Corpn. and Ors., AIR 1980 SC 77; Commissioner of Income Tax, U.P. v. M/s. Shah Sadiq and Sons, AIR 1987 SC 1217; and Vishwant Kumar v. Madan Lal Sharma and Anr., AIR 2004 SC 1887 : (2004 AIR SCW 1713), wherein it has been held that the rights accrued under the Act/Ordinance which stood repealed would continue to exist unless it has specifically or by necessary implication been taken away by the repealing Act._ _27. This Court in State of Punjab and Ors. v. Bhajan Kaur and Ors., AIR 2008 SC 2276 : (2008 AIR SCW 4073), while dealing with the provisions of Section 6 of the Act, 1897 held as under:(SCC p.116, paras 9-10)_ _"9. A statute is presumed to be prospective unless held to be retrospective, either expressly or by necessary implication. A substantive law is presumed to be prospective. It is one of the facets of the rule of law....._ _10. .....Where a right is created by an enactment, in the absence of a clear provision in the statute, it_ W.A. Nos. 1779, 1781 & 1802 of 2013 **: 10 :** _is not to be applied retrospectively."_ _28. In Sangam Spinners v. Regional Provident Fund Commissioner I, AIR 2008 SC 739 : (2007 AIR SCW 7892), this Court held as under: (SCC pp.391g392b)_ _"It is a cardinal principle of construction that every statute is prima facie prospective unless it is expressly or by necessary implication made to have retrospective operation. The absence of a saving clause in a new enactment preserving the rights and liabilities under the repealed law is neither material nor decisive of the question. In terms of Section 6(c) of the General Clauses Act, 1897 unless a different intention appears the repeal shall not affect any right, privilege or liability acquired, accrued or incurred under the enactment repealed."_ _29. A Constitution Bench of this Court in Chairman, Railway Board and Ors. v. C.R.Rangadhamaiah and Ors., AIR 1997 SC 3828 : (1997 AIR SCW 3747),_ W.A. Nos. 1779, 1781 & 1802 of 2013 **: 11 :** _dealt with the case where the pension admissible under the Rules in force at the time of retirement was reduced with retrospective effect. This Court held such an action to be unreasonable and arbitrary being violative of Articles 14 and 16 of the Constitution of India. The Court observed as under: (SCC pp,637-38,paras 20 &24)_ _"20. It can, therefore, be said that a rule which operates in futuro so as to govern future rights of those already in service cannot be assailed on the ground of retroactivity as being violative of Articles 14 and 16 of the Constitution, but a rule which seeks to reverse from an anterior date a benefit which has been granted or availed of, e.g., promotion or pay scale, can be assailed as being violative of Articles 14 and 16 of the Constitution to the extent it operates retrospectively_ _* * *_ _24. In many of these decisions the_ W.A. Nos. 1779, 1781 & 1802 of 2013 **: 12 :** _expressions "vested rights" or "accrued rights" have been used while striking down the impugned provisions which had been given retrospective operation so as to have an adverse effect in the matter of promotion, seniority, substantive appointment, etc., of the employees. The said expressions have been used in the context of a right flowing under the relevant rule which was sought to be altered with effect from an anterior date and thereby taking away the benefits available under the rule in force at that time. It has been held that such an amendment having retrospective operation which has the effect of taking away a benefit already available to the employee under the existing rule is arbitrary, discriminatory and violative of the rights guaranteed under Articles 14 and 16 of the Constitution."_ _Thus, from the above, it is evident that accrued rights cannot be taken away by repealing the_ W.A. Nos. 1779, 1781 & 1802 of 2013 **: 13 :** _statutory provisions arbitrarily. Moreso, the repealing law must provide for taking away such rights, expressly or by necessary implication._ _30. There is no specific word in the Amendment Act, 2006 to suggest its retrospective applicability. Rather the positive provisions of Section 1 suggests to the contrary as it reads:-_ ## _**“1. Short Title and Commencement-** (1) * * *_ _"(2) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint"._ _Undoubtedly, the amended provisions came into force on 23.11.2006 vide S.O. 2002 (E), dated 23.11.2006, published in the Gazette of India, Extra Pt.II, Section 3(ii) dated 23.11.2006. In fact, date 23.11.2006 is the pointer and puts the matter beyond doubt. Thus, in view of the above, we do not have any hesitation to declare that the Notification dated 28.5.2008 is patently illegal._ W.A. Nos. 1779, 1781 & 1802 of 2013 **: 14 :** 9. If this be the legal position, Ext.P8 which was challenged in the writ petition before this Court could only be inconsequential in so far as the appellants in WA Nos.1779/13 and 1781/13 are concerned. Therefore, these appeals are disposed of clarifying that irrespective of the fate of Ext.P8, the appellants in WA Nos.1779/13 and 1781/13 will be entitled to complete their term as Vice President and President of the Kerala State Co-operative Consumers Federation Limited, the Apex Society mentioned above. Sd/- **ANTONY DOMINIC JUDGE** Sd/- **ANIL K. NARENDRAN JUDGE** Rp ## **//True Copy//** **PA TO JUDGE**