Hanumanthegowda and Another vs Block Dev Officer and Retg. Officer and Another

In this petition the two petitioners have challenged the resolution, passed by the Board of Directors of the 2nd respondent the Primary Co-

operative Land Development Bank Ltd., Mandya, on 10-1-1979 directing the 1st respondent to hold the Annual General Meeting on 18-2-1979

because due to inevitable circumstances the Annual General Meeting scheduled to be held on 24-12-1978 could not be held. The resolution

challenged is produced at Ext.-A to the petition.

The 1st petitioner is a member of the 2nd respondent-Bank. The 2nd petitioner is director of the same Bank. According to the averments in the

petition, six Directors were to be elected at the Annual General Meeting. In that behalf, the calendar of events had been issued as required by law

specifying the date of election as 24-12-1978. According to the petitioners, Annual General Meeting on 24-12-1978 could not be held, as all

meetings were prohibited under the Karnataka Police Act, due to local disturbances in the City of Mandya. It is on account of this fact that the

Managing Committee of the 2nd respondent-Bank passed the impugned resolution requesting the 1st respondent to hold the Annual General

Meeting on 18-2-1979. It is further averred by the petitioners that there was a divergence of opinion among the members of the Committee as to

whether, for the Annual General Meeting on 18-2-79, a fresh calender of events had to be issued for purposes of electing the six Directors whose

term of office had expired. However, the Managing Committee decided that the calendar of events already published on 24-12-1978 would

suffice for purposes of holding the elections on 18-2-1979. The 1st petitioner has further averred that he was eager to contest in the elections

scheduled to be held on 18-2-1979 and therefore demanded of the 1st respondent that fresh calendar of events should be issued, so that he could

file his nomination. The 2nd petitioner has averred that he brought to the notice of the 1st respondent that it was not lawful to hold the election

without issuing a fresh calendar of events. The 2nd respondent did not accede to the request of the petitioners and therefore they have presented

this writ petition alleging that they have no other alternative remedy.

Mr. M.S. Gopal, learned Counsel for petitioners, mainly contended that under R. 14(a)(i) of the Karnataka Co-operative Societies Rules,

(hereinafter referred to as the Rules) it was mandatory that the list defaulters should be published at least 15 days prior to the date of election and

since the Annual General Meeting called for on 24-12-1978 could not be held that calendar of events had spent itself and there was need for issue

of a fresh calendar of events in order to comply with R. 14(a)(i) of the Rules. Rule 14(a)(i) of the Rules reads as follows:

14(a)(i). A list of members who are defaulters to the Society in respect of their dues as borrowers or as sureties shall be prepared and affixed on

the notice board of the Society at least fifteen days before the date fixed for elections. No such members shall be eligible to be elected to the

Committee of Management or to stand as candidate for such Committee.

It is significant to notice that R. 14 prescribes the procedure for election of members of the Committee (meaning the Board of Directors in the

instant case). It is also relevant to refer to S. 27 of the Karnataka Co-operative Societies Act, 1959, (hereinafter referred to as the Act) which

deals with the Annual General Meeting of a Society registered under the Act. Under S. 27(1)(b) of the Act, election if any, in the prescribed

manner of the members of the Committee other than nominated members (the other provisions are not relevant for our purpose) should be held. In

the light of these provisions, this Court is not called upon to examine whether the impugned resolution is valid or not. It is not disputed that the

Annual General Meeting scheduled to be held on 24-12-1978 could not be held for reasons beyond the control of the Managing Committee. If

election, was in fact, held on 24-12-78 it is not disputed that the 1st petitioner who has now expressed his desire to contest the elections and who

had not in fact filed his nomination for the election to be held on 24-12-1978, would not have been elected. It is only on account of the inevitable

circumstances under which the Annual General Meeting was postponed, the 1st petitioner now has made a grievance that fresh calendar of events

are required to be published under law because he and others have since cleared all dues to the Society and have become eligible to contest at the

Annual General Meeting scheduled to be held on 18-2-1979, if fresh calendar of events were issued. This is not the same as to contend that R.

14(a)(i) has been violated. It is not disputed that the list of defaulters prepared prior to 24-12-1978 was clearly before 15 days from 18-2-1979.

It is difficult to accede to the contention of the petitioners. It is well accepted principle that if election could not be held in accordance with the

calendar of event''s once issued for any reason, say, on account of an order of stay issued by this Court, when the stay is vacated, there would be

no need for issuing a fresh calendar of events and elections would proceed from the stage at which it was stayed. Why the same principle should

not be applied for the postponement of an Annual General Meeting which could not be held for reasons beyond the control of the Managing

Committee or the Returning Officer, was not explained by the petitioners'' Counsel.

Under the scheme of the Act and the Rules, the power to call an Annual General Meeting is vested in the Committee of Management and on

their failure, by the Registrar of Co-operative Societies in the State of Karnataka (S. 27 of the Act). In the instant case, on both the occasions it

was Managing Committee which exercised the power vested in it an directed the 1st respondent to hold the Annual General Meeting first on 24-

12-1978 and later by its impugned resolution on 18-2-79. Mr. Gopal has not brought to my notice any Bye-law of the Society which supports his

contention that a fresh calendar of events, should be issued. The Act and the Rules are also silent in this behalf. Therefore, I do not see any reason

why the election scheduled to be held on 18-2-1979 and where election to six vacancies of the Board of Directors is to be filled up should be

construed as without the authority of law. The law cannot come to the aid of those who were defaulters in the first instance and who having

removed the disqualification under Rule 14(a)(1) of the Rules, desire to content now.

In this view of the matter, it is difficult to accede to the contentions of the petitioners advanced by their Counsel.

There is yet another reason to reject the contention or the construction sought to be put on the statutory provisions contained in the Act and, the

Rules by Mr. Gopal; because such a construction if it were to be accepted, would lead to inevitable abuse by unscrupulous members by preventing

an election taking place at an Annual General Meeting by unlawful methods and thereby perpetually postponing the election to the advantage of

Directors who would continue in office till the new Directors take office.

Hence, the writ petition is rejected and no rule is issued.