Case Note & Summary
The petitioner, Panchshil Co-Operative Housing Society Limited, a society registered under the Maharashtra Co-operative Societies Act, 1960, challenged the orders passed by the Deputy Registrar (Sub Registrar) directing winding up of the society and appointing a Liquidator. The dispute arose when the Sub Registrar, purportedly exercising powers under Section 102(1)(c)(ii) and (iv) of the Act, passed an interim order on 31.12.2020 directing winding up and appointed respondent No. 3 as Liquidator under Section 103. By order dated 27.01.2021, the Sub Registrar confirmed the interim order and directed winding up. The petitioner contended that the interim order was never served on the society, violating the mandatory requirement of Section 102(2) of the Act. The respondents raised a preliminary objection that the petitioner had alternate remedies of appeal under Section 104 and revision under Section 154. The Court examined the statutory provisions and found that Section 104 proviso bars appeal against orders passed under clause (ii) of Section 102(1)(c), while revision under Section 154 lies only where no appeal lies, and an order under clause (iv) is appealable. Since the impugned order was passed under both clauses simultaneously, the petitioner would have to pursue a split remedy, and no efficacious alternate remedy existed; hence, the writ petition was held maintainable. On merits, the Court noted that Section 102(2) requires communication of the interim order to the society in the prescribed manner and an opportunity of hearing before final confirmation. The petitioner asserted that the interim order was never served. The respondents relied on a communication dated 08.01.2021 from the Liquidator to the Registrar indicating that the Chairman had died and the Secretary had moved to Mumbai three to four years earlier, making service impossible. The Court held that this communication by the Liquidator could not substitute for the statutory service required to be effected by the Sub Registrar. The Liquidator had no authority to exercise the power of service vested only in the Registrar. Therefore, the final order confirming winding up was passed in clear deviation from the principles of natural justice. The Court relied on the Division Bench decision in Chandrapur Zilla Sahakari Krushi and Gramin Bahuudeshiya Development Bank Ltd v. State of Maharashtra, 2004(3) Bom. C.R. 889, which had struck down a final order for similar non-compliance with the service mandate. In the result, the writ petition was allowed; the impugned final order passed under Section 103 of the Act was quashed and set aside. The petitioner was directed to appear before the Registrar on 15.11.2021, whereupon the Registrar would serve a copy of the interim order, and after giving sufficient opportunity of being heard, pass a fresh final order under Section 103. Rule was made absolute.
Headnote
A) Co-operative Societies - Winding Up - Alternate Remedy - Maharashtra Co-operative Societies Act, 1960, Sections 102, 104 and 154 - The Sub Registrar passed interim and final winding-up orders under both clauses (ii) and (iv) of Section 102(1)(c), and because appeal under Section 104 was barred by proviso only for clause (ii) while revision under Section 154 was not available where appeal lay for clause (iv), the petitioner had no single efficacious alternate remedy; the preliminary objection was rejected and writ petition held maintainable (Paras 3-8). B) Co-operative Societies - Winding Up - Communication of Interim Order - Maharashtra Co-operative Societies Act, 1960, Section 102(2) - Section 102(2) requires the interim winding-up order to be communicated in the prescribed manner to the society and an opportunity of hearing before final confirmation; the petitioner society was never served and the Liquidator's communication to the Registrar that the Chairman had died and Secretary had moved could not substitute statutory service, so the final order violated natural justice and was quashed (Paras 11-15). C) Administrative Law - Delegation of Statutory Power - Maharashtra Co-operative Societies Act, 1960, Section 102(2) - The power to communicate/serve the interim order vested in the Registrar/Sub Registrar and was required to be exercised in the prescribed manner; the Liquidator had no authority to effect service, and no attempt by the Sub Registrar was shown, rendering the confirmation invalid (Paras 13-14). D) Precedent - Co-operative Societies - Non-Service of Interim Order - Maharashtra Co-operative Societies Act, 1960, Section 103 - The Division Bench in Chandrapur Zilla Sahakari Krushi and Gramin Bahuudeshiya Development Bank Ltd v. State of Maharashtra, 2004(3) Bom. C.R. 889 struck down a final order for non-compliance with service mandate; the same principle was followed to quash the final order under Section 103 (Para 16). E) Writ Jurisdiction - Scope of Review - Disputed Questions of Fact - While examining the winding-up orders, the Court confined itself to the decision-making process and declined to adjudicate disputed factual questions regarding the existence of grounds for winding-up; the Sub Registrar's justification under Section 102(1)(c) was left open for fresh consideration after due compliance (Paras 9-10).
Issue of Consideration
Whether the writ petition is maintainable despite alternate remedies under Sections 104 and 154 of the Maharashtra Co-operative Societies Act, 1960; whether the final order confirming winding up is vitiated by non-service of the interim order and violation of natural justice.
Final Decision
The writ petition was allowed. The impugned final order passed under Section 103 of the Act was quashed and set aside. The petitioner was directed to appear before the Registrar on 15.11.2021, whereupon the Registrar shall serve a copy of the interim order to it on that day. The petitioner may thereafter put up its case before the Registrar, and after giving sufficient opportunity of being heard, the Registrar may pass a fresh final order under Section 103. Rule made absolute.
Law Points
- Non-service of interim order under Section 102(2) of the Maharashtra Co-operative Societies Act
- 1960 before confirmation violates natural justice
- Power to communicate interim order vests in Registrar and cannot be delegated to Liquidator
- No appeal lies against order under Section 102(1)(c)(ii) due to proviso to Section 104(1)
- Revision under Section 154 not available where appeal lies under Section 104 for clause (iv)
- Writ jurisdiction examines decision-making process not disputed facts
- Authority must exercise powers strictly in manner prescribed
