SATNA CENTRAL CO OPERATIVE AND LAND MORTGAGE BANK LTD Vs. PURANLAL AGRAWAL
LAWS(MPH)-1969-7-9
HIGH COURT OF MADHYA PRADESH
Decided on July 01,1969

SATNA CENTRAL CO-OPERATIVE AND LAND MORTGAGE BANK LTD. Appellant
VERSUS
PURANLAL AGRAWAL Respondents

JUDGEMENT

A.P.SEN J. - (1.) BY this application under Articles 226 and 227 of the Constitution, the petitioner Satna Central Co-operative and Land Mortgage Bank Ltd. (hereinafter referred to as "the petitioner-Bank"), seeks the issue of a writ in the nature of certiorari for quashing an order of the Board of Revenue, Madhya Pradesh, dated 2nd April 1968, and for an appropriate writ or direction in the nature of mandamus to restrain the authorities from giving effect to the impugned order, in the manner threatened.
(2.) THE relevant facts leading to this application are these. By the order impugned, the Board of Revenue, Madhya Pradesh has, in a second appeal under section 77 (2) of the Madhya Pradesh Co-operative Societies Act, 1960 (Act No. XVII of 1961), (hereinafter referred to as "the Act"), reversed an order passed in first appeal by the Joint Registrar of the Co-operative Societies, confirming the acceptance of resignation of the respondent No. 1, Puranlal Agrawal, against whom the petitioner-Bank had instituted an inquiry into certain charges, by a resolution of the Board of Directors passed at its meeting held on 13th July 1965 and instead, set aside the resolution on the grounds that: (i) the Board of Directors of the petitioner-Bank was not during the material time, duly constituted, and (ii) there was no quorum for its meeting held on 13th July 1965 at which the said resolution was passed. Upon these findings, the Board of Revenue has set aside the resolution of the Board of Directors accepting the resignation of the said Puranlal as being legally invalid and, accordingly directed his reinstatement to his post forthwith, with a direction for payment of all the back wages and other allowances for the period during which he was "illegally kept out of office", and held that his resignation had still so far not been "legally accepted". The operative part of the impugned order of the Board of Revenue proceeds on these lines. According to Bye-law No. 30 of the byelaws, there has to be constituted a Board of Directors consising of 18 persons. Of these, the Registrar, Co-operative Societies or his nominee not below the rank of the Assistant Registrar is one. It appears that at the time when the meeting of the Board was held on 13-7-1965, the Board consisted only of 11 members and was not fully constituted for some reason or the other, as prescribed in byelaw No. 30. Bye-law No. 35 prescribes that 2 /5ths of members of the Board of Directors shall form a quorum. If the total strength of the Board of Directors is taken as the basis, then 7 members will constitute the quorum. On behalf of the Bank it was urged that number of members required for the quorum should be determined with reference to the actual number of Directors and not with reference to the prescribed strength of 18. Thus, as against the strength of 11 members, the number of members required to be present for the quorum was 5. According to the Board of Revenue, the number of persons required to be present to form a proper quorum had to be determined "with reference to the total number of members of the Board", as prescribed under byelaw No. 30, and not the number of the Directors actually working in the Board. The Board of Revenue further held that any other view will lead to impossible situation as according to its view, a quorum for proper functioning of any representative body was prescribed to ensure that some mini mum number of persons take part in deliberations and take decisions on behalf of the Board they represent. Thereafter, the Board proceeded to deal with the question, whether Bank Inspector P. M. Gore who was in-current-charge of the duties of the Assistant Registrar, and held that he was not entitled to participate in the meeting as a nominee of the Registrar under Bye-law No. 30 (vi). Eventually, the Board of Revenue came to the conclusion that Resolution No. 8 of the Board of Directors, accepting the resignation of the respondent No. 1 was not legally and validly passed and that in the absence of a proper quorum the resolution was a nullity and not binding. The decision of the Board of Revenue has been assailed before us, on the following three grounds, namely- (i) No second appeal lay to the Board under section 77(2) of the Madhya Pradesh Co-operative Societies Act, 1960 against an order passed by the Joint Registrar in proceedings under section 55(2), inasmuch as the decision rendered therein was binding on the parties, and hence its assumption of jurisdiction was wholly illegal; (ii) Upon a misconstruction of Bye-laws 30 and 35, the Board of Revenue has wrongly held that the Board of Directors of the petitioner-Bank must always consist of 18 members, and that for want of a quorum its proceedings held on 13th July 1965 were entirely vitiated; and (iii) The Board of Revenue had no jurisdiction either to direct a re-in- statement of the employee concerned or to make a direction for payment of the back-wages and other allowances.
(3.) AS to the first, it is urged that the words "his decision shall be binding" appearing in section 55 (2) of the Act, renders a finality to the decision of the Registrar on a dispute falling within the purview of that section. It reads: "55(2). Where a dispute including a dispute regarding terms of employment, working conditions and disciplinary action by a society, arises between a society and its employees, the Registrar or any officer appointed by him, not below the rank of ASsistant Registrar, shall decide the dispute and his decision shall be binding on the society and its employees."' In view of that finality, it is asserted that the decision of the Registrar under the section, cannot be assailed in an appeal under sub-section (1) of section 77, much less in second appeal under sub-section (2) thereof, having regard to the opening words of sub-section (1) : "Save where it has been otherwise provided". The argument is that section 55 (2) of the Act, is a provision which prescribes for a reference to the Registrar on such a dispute arising and it attaches a finality to the decision rendered therein. In other words, section 55 (2) prescribes for a particular forum for adjudication which excludes other normal remedies and, therefore, no appeal lies in such matters. It is urged that section 55 (2) is an "otherwise provision", within the meaning of section 77 (1) of the Act, and no appeal, therefore, lies. Now the relevant provisions of section 77 are in these terms: "(1) Save where it has been otherwise provided, an appeal shall lie from every original order under this Act or the rules thereunder- (a) if such order is passed by any officer subordinate to the Registrar, other than Additional Registrar or Joint Registrar, whether or not the officer passing the order is invested with the powers of the Registrar - to the Registrar; (b) if such order passed by the Registrar, Additional Registrar or Joint Registrar-to the State Government. (2) A second appeal shall lie against any order passed in first appeal by the Registrar, Additional Registrar or Joint Registrar to the State Government on any of the following grounds and no other, namely- (i) that the order is contrary to law; or (ii) that the order has failed to determine some material issue of law; or (iii) that there has been a substantial error or defect in the decision of the case upon merits." I am of the view that there is no merit in this contention. The words "his decision shall be binding", which appears in section 55 (2) of the Act are susceptible of no other construction than this, that a decision of the Registrar under the section is binding so long as it exists and it pre-supposes the existence of a decision. There can be no finality attached to a decision of the Registrar under section 55 (2), as its binding effect is always subject to the result of an appeal taken from the decision. That it must be so, is manifest if we contrast the language of this section with that of section 64 (3). It is significant that an adjudication by an Award of the Registrar upon a reference of any of the disputes falling under section 64 (1), read with sub-section (2) to that section, is not final, but a finality attaches to his decision under sub-section (3) thereof upon the question whether a particular dispute referred to him is a 'dispute'. To illustrate the distinction the provisions of section 64 (3) may profitably be set out- "64(3). If any question arises whether a dispute referred to the Registrar is a dispute, the decision thereon of the Registrar shall be final and not be called in question in any Court." The fallacy underlying the submission that there is a finality to the decision of the Registrar under section 55 (2) is, that the learned counsel for the petitioner- Bank wants me to read 'shall be final' for the words 'shall be binding' appearing therein. It is a cardinal rule of construction of statutes that a Court must interpret a provision as it exists, and it is not permissible to add to or alter its terms, in any manner whatever. In my view, an appeal lies against the decision of the Registrar under section 55 (2) and I am fortified in my conclusion by the decision of this Court in Ramcharan v. M. P. State Tad-Gud Co-operative Federation Ltd., 1966 MPLJ 421. I may with advantage refer to the following observations made by Dixit C. J., in that case : "It is no doubt true that section 77(1) precludes an appeal in cases where there is an 'otherwise' provision. But the provision contained in section 55(2) that the decision of the Registrar or any officer appointed by him 'shall be binding on the society and its employees' is not an 'otherwise provision' taking away the right of appeal in cases determined under section 55 (2). The expression 'decision shall be binding on the society and its employees' as used in section 55(2) does not mean that the decision of the Registrar or any officer appointed by him determining a dispute shall be final and conclusive and not subject to appeal. The expression 'decision shall be binding' only denotes that the decision shall affect the society and the employees concerned in a constraining or compulsory manner. ******** A decision may or may not be subject to any appeal according to the provision contained in the statute dealing with appeals against that decision. In our judgment, the expression 'decision shall be binding on the society and its employees' occurring in section 55(2) cannot, therefore, be treated as an 'otherwise provision' prohibiting an appeal under section 77(1) against a decision of the Registrar, or any officer appointed by him, deciding the dispute under that provision." For these reasons the first contention must fail and stands rejected.;


Click here to view full judgement.
Copyright © Regent Computronics Pvt.Ltd.