Vittala Vyavasaya Seva Sahakari Sangha Niyamitha vs State of Karnataka

Shivaraj Patil, J

The petitioner has called in question the correctness and validity of the order dated 8.10.1991 (Annexure ''E'') under which, the State Government, exercising power u/s 29(1) of the Karnataka Co-operative Societies Act, 1959, has nominated three persons as Directors to the petitioner-Society.

Sri S. Krishnaiah, the learned Counsel for the petitioner, strongly contended that the nomination made under Annexure ''E'' nominating three persons is bad in law, inasmuch as, the total number of Directors of the Society is 11 as per the bye-law. The bye-law itself provides for two nominated members and the State Government could nominate one more member. The learned Counsel does not dispute that this is a Society in respect of which, power of nomination could be exercised by the Government only u/s 29. The grievance of the petitioner is that in addition to two nominated members provided in bye-law, if three more members are nominated exercising power u/s 29 of the Act, it would totally make the strength of the Directors 14 which exceeds the total number of Directors fixed in the bye-law. As such, the impugned order-Annexure ''E'' is liable to be quashed. In support of this submission, the learned Counsel placed reliance on the Division Bench Judgment of this Court dated 6.9.1990 passed in W.P.No. 10889/1988, Padmanabha v. State of Karnataka.

In said Judgment, this Court, on the facts of that case, has held that the powers of nomination of the Government u/s 29 and Section 53(A) are mutually exclusive. It is also held that nomination cannot be made by the Government so as to increase the strength of the Directors taking into consideration the provision made already for nomination under the bye-law. At any rate, the nomination so made should not exceed the limit prescribed u/s 29 or u/s 53(A) of the Act, as the case may be. Even it must be seen that the total strength of the Directors does not exceed the strength fixed in the bye-law.

The Division Bench of this Court, in a later Decision in the case of C.E. KRISHNEGOWDA v. STATE OF KARNATAKA ILR 1991 KAR 2218 has clearly laid down while interpreting the power of Government to nominate u/s 29(1) of the Act. The Division Bench of this Court has stated thus in para-4, which reads:-

"In categorical terms the Section says: "Shall notwithstanding anything contained in this Act or the Rules or the Bye-laws of the Co-operative Society". Therefore, this clause obviously means it shall have over-riding effect. The only clarification is that they are subject to any Notification issued u/s 54 or 121. We may straightaway say that we are not concerned with such a situation. The Government have the right to nominate as its representatives not more than three persons. It has already been seen that the two nominations viz., one to represent the Assistant Registrar (grama sevak) and the other to represent the financial institution, cannot by any stretch of imagination be the representatives of the Government u/s 29(1). Even otherwise, as rightly contended by Mr. Vasudeva Reddy this power is an independent one and no bye-law can whittle down or mitigate against the rigour of Section 29(1) of the Act, It is equally well settled that a bye-law is nothing more than a concession".

In para-5 of the said Judgment, reference is made to the case of NAGANNA GOWDA N.G. & ANR. v. STATE OF KARNATAKA AND ORS. 1987(2) KLJ 389 which Decision was referred to by the Division Bench of this Court in W.P.No.10889/88. The later Division Bench Judgment of this Court is directly on the point which arises for consideration in this Writ Petition.

The learned Counsel for the petitioner submitted that the later Decision of the Division Bench of this Court C.E. Krishnegowda v. State of Karnataka is per incuriam. I am unable to agree with this submission. The Division Bench in the case of C.E. KRISHNEGOWDA aforementioned has referred and considered Kumaraswamy v. State of Karnataka 1979(1) K.L.J.105 and Naganna Gowda v. State of Karnataka 1987(2) K.L.J. 3895 and has distinguished the same as can be seen from para-5 of the said Judgment. All the contentions urged by the learned Counsel for the petitioner stand covered by the said Judgment. His prayer to refer this case to the Division Bench on the ground that there is conflict of Decisions is also not tenable in view of the Division Bench Judgment of this Court in C.E. KRISHNEGOWDA, which is directly on the point. Added to this, it is well settled law that in case of conflict, if any, between bye-law and a Section of the Act, Section shall prevail. The later Division Bench Judgment has taken the same view and as such it is binding on me.

In this view of the matter, I decline to entertain this Writ Petition and consequently it is rejected at the stage of Preliminary Hearing.