P. K. BANERJEE, C. J. -
(1.)THIS rule is obtained by a Co-operative Society against an order passed by the Assistant Registrar, Co-operative Societies and on revision by the State Government.
(2.)THE facts leading to the rule are that the petitioner is a Co-operative Society, which came into existence in 1916. THE membership of the petitioner Society is 55 and the share capital of the petitioner Society is Rs. 1,500/ -. THE petitioner Society has earned a profit of Rs. 9,700/- in the co-operative year 1968-69 and the business turn over of the petitioner Society is Rs. 1,5675/- in the year 1986-69. It is alleged that ever since its inception, the petitioner Society has always kept in mind the well being of its members and has advanced loan to its members at a nominal rate of interest. By notice under Section 17 of the Rajasthan Co-operative Societies Act, 1965, the petitioner Society was proposed to be amalgamated with Brihad Bahuddeshiya Sahkari Samiti, Pachel Kalan, respondent No. 4. On receipt of the notice, the petitioner Society unanimously resolved in its annual general meeting that amalgamation should not be made and filed its objections stating that the members of the petitioner Society did not want its amalgamation with respondent No. 4. THE objections filed by the petitioner Society were over-ruled by respondent No. 3, Assistant Registrar, Co-operative Societies, Baran, vied his order dated July 30, 1969. Being aggrieved by it, the petitioner Society filed an appeal before the Registrar, Co-operative Societies, Rajasthan, but the same was rejected vide order dated September 21, 1970. THE petitioner Society then filed a revision application before the State Government contending inter-alia that it is neither in the public interest, nor in the interest of Co-operative movement that the petitioner Society should be amalgamated with respondent No. 4, which was rejected by order dated September 9, 1974. While rejecting the revision application the State Government observed that unless a Co-operative Society has 200 members, a share capital of Rs. 20,000/- and distribution of loan of Rs. 1,00,000/- as well as non-trading business of Rs. 20,000/-, a Co-operative society cannot exist and, therefore, the objection of the petitioner cannot be upheld. Being aggrieved by the said orders, the petitioner obtained the present rule.
Mr. Sharma, on behalf of the petitioner society contended that these conditions which were enumerated in the order of the State Government are not in accordance with the statute itself and are beyond the powers of the Registrar or Assistant Registrar, Co-operative Societies and ultra-vires of the statutory provisions.
Mr. Khan, on behalf of the respondents, however, contended that under Sections 14, 15, 16, and 17 of the Rajasthan Co-operative Societies Act the State Government has the powers of directing an amendment of bye-laws and direct amalgamation, division and re-organisation in public interest of a Co-operative society. Section 14 deals with the power of directing an amendment of bye-laws. Section 15 deals with date on which such amended bye-laws will come into force. Section 16 relates to amalgamation, transfer of assets and liabilities and division of Co-operative societies. Section 17 gives power to direct amalgamation, division, and re~organisation in public interest of a Co-operative society.
I will first deal with the objection relating to Section 14 of the Act as raised by Mr. Khan on behalf of the respondents. Section 14 deals with the power to direct an amendment of bye-laws. If at any time, it appears to the Registrar that an amendment of the bye-laws of a Co-operative society is neces-sary or desirable in the interests of such society, he may, by an order in writing, require the society to make such amendment within such time as he may specify in such order. It has not been stated how this section has been brought into force by Mr. Khan when no amendment has been directed to be made by the Registrar, Co-operative Societies. Section 15 is consequential to Section 14. If no such direction has been given by the Registrar, Section 15 cannot come into play. Sections 16 and 17 relate to amalgamation of a co-operative society and Section 16 provides that a co-operative society may, with the provious approval of the Registrar and by a resolution passed by a two-third majority of the members present and voting at a general meeting of the society; transfer its assets and liabilities in whole or in part to any other Co-operative society or divide itself into two or more Co-operative societies. Any two or more Co-opera-tive societies may, with the previous approval of the Registrar and by a reso-lution passed by a two third majority of the members present and voting at a general meeting of each such society, amalgamate themselves and form a new Co-operative society. We are not concerned with the other provisions of Section 16. Section 16 gives powers to the co-operative societies themslves to make amalgamation as between themselves, but subject to the approval of the Regis-trar previously obtained. It is not the case of the respondents that the petitioner Co-operative Society wanted its amalgamation' with other co-operative society, viz , respondent No. 4. In so far as Section 17 is concerned, if the Registrar is satisfied that it is essential in the public interest, or in the interest of the Co-operative movement, or for the purpose of securing the proper management of any Co-operative society that two or more Co-operative societies should amalga-mate or any Co-operative society should be divided to form two or more socie-ties or should be recognised etc. order can be made by the Registrar. The order impugned in this case is an order under Section 17 of the Act. It appears, however, the reasons given for such amalgamation are beyond the powers conferred by the statutory provisions of the Act and the Rules. Under Section 6 of the Rajasthan Co-operative Societies Act, 1965, a Co-operative society can be formed with 15 members and each such persons shall be a member of a diffe-rent family and a service Co-operative society can be formed with 50 members, each of whom shall be a member of a different family. The minimum share capital of service Co-operative society shall be Rs. 750/ -. This is a service Co-operative society and all the provisions of Sec. 6 in terms have been followed by such society. It is nobody's case that such is not so, but there was no speaking order of the Assistant Registrar or the Registrar on the objection filed by the petitioner society, but the State Government passed an elaborate order and came to a finding that such amalgamation is necessary as the petitioner Society has not 200 members and the share capital of Rs. 20,000/- and loan distribution of Rs. 1,00,000/- and the non-trading business must be Rs. 20,000/- and, therefore, the present Co-operative society has not those things for which it should be amalgamated with respondent No. 4.
In my view this whole basis of the order of the State Government cannot be sustained, because that is contrary to the statutory provisions of the Rajasthan Co-operative Societies Act. Therefore, I am of the opinion that the orders of the Assistant,registrar, Co-operative Societies, Registrar, Co-operative Societies and the State Government cannot be sustained and must be set aside, which I hereby do.
(3.)THE rule is, therefore, made absolute. THEre will be no order as to costs. .