Balbir Singh vs Deputy Registrar, Co-operative Societies, Sangrur

S.S. Kang, J.

Balbir Singh petitioner was elected as a member of the Managing Committee, also known as Board of Directors of the Sunam Primary Co operative Land Mortgage Bank Limited, Sunam (hereinafter referred to as the Bank) in the election held on August 18, 1978 from Zone No. 1. He had been opposed by Sher Singh respondent No. 3. Sher Singh filed an application before the Deputy Registrar, Cooperative Societies, Sangrur, respondent No. 1, under section 55 of the Punjab Cooperative Societies Act (hereinafter referred to as the Act), raising a dispute regarding the election of the petitioner. On a prayer by Sher Singh respondent No. 3, the petitioner had been restrained by respondent No. 1 from taking part in the affairs of the Bank. The petitioner, filed a written statement and raised therein certain points before respondent No. 1, who vacated the stay order granted vide his order dated September 8, 1978. The application for arbitration was withdrawn by Sher Singh respondent No. 3 and the same was dismissed on November 16, 1978.

Jeeva Singh respondent No. 2 filed an application on December 18, 1978 before respondent No. 1 stating that one Hardarshan Singh son of Prem Singh was the real nephew of the petitioner and he was employed in the State Co operative Land Mortgage Bank as an Assistant Inspecting Officer, incharge of Patiala and Sunam, and that the petitioner had given a wrong declaration in clause 7 of the nomination papers that he was not related to any employee of State Cooperative Land Mortgage Bank or the Bank. Jeeva Singh in that application prayed that Balbir singh petitioner be disqualified and the applicant who had fought the selection against him be declared elected. Respondent No. 1 exercising the powers of the Registrar, Cooperative Societies, Punjab, ordered on December 22, 1978, that Balbir Singh petitioner had ceased from the Directorship of the Bank. Dissatisfied with this order, copy of which is appended as Annexure P6 with the petition, the petitioner has filed the present petition.

The Deputy Registrar, Cooperative Societies, respondent No. 1 has come to the conclusion that Hardarshan Singh was a nephew of the petitioner. He was an employee of the State Cooperative Land Mortgage Bank and happened to be incharge of Patiala and Sunam branches of the State Cooperative Land Mortgage Bank. Respondent No. 1 has passed the impugned order, purporting the exercise of the powers conferred on him under Rule 26(f) of the Punjab Co operative Societies Rules, 1963 (hereinafter referred to as the Rules). He concluded that Balbir Singh petitioner had filed written declaration at the time of contesting the election. If this information were available at the time of the scrutiny of the nomination papers, the opposite party may have raised objections against the nomination papers, of Balbir Singh petitioner and he may not have been allowed to seek the poll. Purporting to exercise the powers conferred by Rule 26(f) of the Rules, the Deputy Registrar ceased the petitioner from the Directorship of the Bank.

Mr. B.S. Khoji, the learned counsel for the petitioner, has contended that a member of the committee shall cease to hold office if he becomes subject to any disqualification which would have prevented him from seeking election had he incurred that disqualification before election. It will be useful to extract the relevant provisions of Rule 26 of the Rules at this stage:

"26. Cessation of membership of committee. A member of the committee shall cease to hold his office as such if he :

(a) continues to be in default in respect of any sum due from him to the Cooperative Society for such period as may be laid down in the byelaws;

(b) ceases to be a member;

(c) is declared insolvent;

(d) becomes of unsound mind;

(e) is convicted of an offence involving dishonesty or moral turpitude; or

(f) becomes subject to any disqualification which would have prevented him from seeking election, had he incurred that disqualification before election".

The disqualifications for the members of the committees of the Co operative Societies are given in rule 25 of the Rules which is in the following terms :

"25. Disqualification for membership of committee. No person shall be eligible for election as a member of the committee if :

(a) he is in default to any cooperative society in respect of any sum due from him to the society or owes to any cooperative society an amount exceeding his maximum credit limit;

(b) he has, directly or indirectly, any interest in any contract to which the cooperative society is a party except in transactions made with the co operative society as a member in accordance with the objects of the society as stated in the byelaws;

(c) he has at any time during a period of one year prior to the date of scrutiny of nomination papers, engaged in any private business, trade or profession of any description which is carried on by the society;

(d) he has committed any offence involving dishonesty or moral turpitude during a period of five years prior to the date of scrutiny of nomination papers;

(e) he is subjected to any of the prohibitions contained in Rule 29;

(f) he has, during a period of 12 months preceding the date of filing of nomination papers, remained inactive as member or has been carrying on, through agencies other than the cooperative society of which he is a member of the same business as is being carried on by the cooperative society;

(g) he is a member of an elected committee of any cooperative society which has ceased to function or which has not fulfilled its objects as stated in its byelaws and has been included in the list of D class societies maintained by the Registrar or is a member of an elected committee of society which is under winding up process;

(gg) he has ceased to be a member of an elected committee of any co operative society within a period of one year preceding the date of inclusion of such society in the list of D Class societies maintained by the Registrar or the operation of order of winding up of such society under section 57 of the Act;

(h) he incurs any other disqualification laid down in the byelaws of the society.

Provided that nothing in clauses (g) and (gg) shall be deemed to debar any person from seeking election if the society under winding up process of which he is a member is a society which limited liability and that person discharges all his liabilities including liability as a surety, if any, in relation to such a society, within two months from the receipt of assessment orders."

If we have a look at Rule 25, we find that the employment of a relation with the State Cooperative Land Mortgage Bank, or the Bank, is not mentioned as a disqualification under Rule 25 of the Rules. The learned counsel for the parties are agreed that Rule 25 is the only provision in the Rules which provides the disqualification for membership of the committee of a Co operative Society. By clause (h) of Rule 25, it has been provided that the byelaws of a Society can also lay down disqualifications other than those member in Rule 25 of the Rules. The learned counsel for the parties also agreed that the Bank has not framed any bylaws whereby a relation of the employee of the Bank or the State Cooperative Land Mortgage Bank, has been debarred from seeking election to the Committee of the Bank. So if the petitioner has not incurred any disqualification in terms of Rule 25 of the Rules, he is not disqualified from seeking election. It is clear from the joint reading of Rules 25 and 26 of the Rules, that a person whose relation is employed with the Bank or the State Cooperative Land Mortgage Bank, is in no way disqualified from seeking election to the Committee. Mr. Khoji has contended that Rule 25 lays down disqualifications in general. Any person who suffers from these disqualification cannot seek election for the membership of the Committee. He is ineligible to stand for election. His nomination papers are liable to be rejected at the time of scrutiny if any of the disqualifications in Rule 25 are attached to him. Rule 26, according to the learned counsel, provides for post election disqualifications. The language `employed'' in the Rule fully supports this contention. The Rule says that a member of the Committee shall cease to hold his office if he is guilty of the omissions and commissions enumerated in that Rule. The Rule for its application clearly postulates that the delinquent already is a member of the Committee and he has after his election incurred any disqualification, which would have prevented him from seeking the election. So the plain meanings of Rule 26 are that if a person who was not disqualified to be elected at the time of elections, is elected, and thereafter he incurs any of the disqualifications which would have prevented him from seeking election, then he will cease to be a member of the Committee. The disqualifications in Rule 26, therefore, are clearly post election disqualifications. Even conversely, Rule 26 does not take note of the disqualifications which were there at the time of the elections. It is for that good reason an elaborate procedure has been provided for adjudication of the election disputes. If a person was not qualified or was disqualified at the time of his election, then that election can be challenged in arbitration proceedings under section 55 of the Act. However, if a person once elected incurs disqualification which would have prevented him from seeking the election, then the remedy for his removal in the arbitration proceedings is not available. In that contingency the only provision applicable is Rule 26 of the Rules. In the present case it is nobody''s claim that Hardarshan Singh had joined the service of the State Co operative Land Mortgage Bank after the election of the petitioner, to the Committee of the Bank. Even according to the allegations of Jeeva Singh and the finding by respondent No. 1, Hardarshan Singh was an employee of the State Cooperative Land Mortgage Bank at the time when Balbir Singh petitioner filed his nomination papers.

Mr. Kuldip Singh, the learned counsel for respondent No. 4 has argued that the election programme was framed by the Bank and it had been approved by the Registrar, Cooperative Societies. The form of nomination paper has been prescribed by the Registrar. There is a column in that form which requires a declaration that no relation of the candidate is an employee of the State Co operative Land Mortgage Bank or the Bank itself. So, this form becomes a part of the byelaws of the Bank and any violation of the byelaw will be disqualification rendering the election of the petitioner invalid. There is no force in this contention. No doubt, the election programme and the nomination form have been approved by the Registrar, but that fact alone does not raise them to the level of a byelaws.

I, therefore, allow this writ petition and set aside the impugned order with costs. Counsel fee Rs. 300/