Raj Kumar Negi vs State Of Himachal Pradesh And Others

L. Narayana Swamy, CJ

The petitioner, who, as contended, was a former Director of respondent No. 3­Bank has filed this petition seeking a direction to respondent No. 2, i.e. Registrar Cooperative Societies, Himachal Pradesh for appointment of an Administrator.

It is the submission of the learned Senior Counsel appearing for the petitioner, that respondent No. 3­Bank initially consisted of twelve Directors, of which one is an ex­ officio Director. Out of these twelve Directors, seven Directors have submitted their resignations, of which resignations of five Directors have been accepted and the resignations of two Directors have been forwarded for acceptance.

It is his further submission that in view of the resignations of the above­said Directors, respondent No. 3­ Bank cannot function being defunct. Respondent No. 3­Bank can only function with the appropriate number of Directors and in their absence, when seven Directors have tendered their resignations, Registrar of the Cooperative Societies, Himachal Pradesh, has to exercise his powers under Section 37 of the Himachal Pradesh Cooperative Societies Act, 1968 (hereinafter referred to as 'the Act') for appointment of Administrator. Further submitted that now, the Managing Director of the third respondent­Bank has issued an Election Programme for the election of the Board of Directors, for which the calendar of events would come into force, according to which the elections are to be held on 15th September, 2020 and thereafter, new Body will come into existence and till then, for smooth functioning of respondent No. 3­Bank, the Registrar of the Cooperative Societies should appoint an Administrator.

Hence, learned Senior Counsel appearing for the petitioner seeks a direction to the respondents for appointment of Administrator to respondent No. 3­Bank.

Learned counsel appearing for respondent No.3 has fairly conceded that in total, seven Directors have submitted their resignations, out of which resignations submitted by five Directors have been accepted and that of two Directors have been forwarded for acceptance.

Learned Advocate General appearing on behalf of respondents No. 1 and 2 submitted that the Registrar of Cooperative Societies cannot exercise powers under Section 37 of the Act to appoint Administrator, in the facts and circumstances of the instant case. He further submitted that the petitioner has no locus standi to prefer the instant writ petition as he has already submitted his resignation from the post of Director of respondent No. 3­Bank, which has been accepted.

In this backdrop, learned counsel appearing for the respective respondents seek dismissal of the writ petition.

We have heard learned counsel for the parties.

At the outset, with regard to the locus standi of the petitioner, it would be apt to record herein that the petitioner himself has admitted that he was a former Director and has submitted his resignation. Though, he ceases to be a Director, but, he remains a Member of the Cooperative Society. The object of filing of the instant writ petition seeking a direction to the Registrar of Cooperative Societies for appointment of Administrator appears to be for smooth functioning of respondent No. 3­Bank as unless and until the quorum is complete, respondent No. 3­Bank cannot function and manage its affairs. Hence, the instant writ petition is maintainable.

As per the calendar of events, the date fixed for conducting the elections and also for declaration of result is 15th September, 2020, which means to say, till 15th September, 2020, there is no Body in existence for smooth functioning and proper management of the affairs of respondent No. 3­Bank and for the said purpose, Section 37 sub­Section 1(b) of the Act entitles the Registrar of the Cooperative Societies to exercise his powers to fill­up the vacancies for the remaining period.

Though, we are not expressing any opinion on merits, but, for the purpose of smooth functioning and proper management of the affairs of respondent No. 3­Bank, till the new Body comes into existence on 15th September, 2020, we direct the Registrar of Cooperative Societies to exercise his powers in terms of Section 37 of the Act and pass appropriate orders within a period of two weeks.

With these observations, the writ petition is disposed of, so also the pending miscellaneous applications, if any.