Case Note & Summary
The petitioners, four of the 17 directors of the Solapur Zillah Dudha Utpadak Sangha, a co-operative society registered under the Maharashtra Co-operative Societies Act, 1960, challenged an order dated 13 August 2020 passed by the Secretary, State Co-operative Election Authority (Respondent No.3). The impugned order appointed the Divisional Deputy Registrar, Co-operative Societies (Dairy), Pune (Respondent No.2) as an administrator to conduct the election for the post of Chairman of the society and restrained the Board of Directors from holding any meeting for that purpose. The society's bye-laws provided that the Chairman shall be elected by the Board of Directors from amongst themselves. The petitioners argued that the Election Authority had no power under Section 73CA of the Act to appoint an administrator for an internal election of Chairman, as Section 73CA only deals with elections to the Board of Directors. The respondents contended that the Election Authority had wide powers to ensure free and fair elections. The court analyzed Section 73CA and the relevant rules, noting that the term 'election' in the Act refers to election of members of the Board of Directors, not internal elections like Chairman. The court held that the impugned order was without jurisdiction and ultra vires the Act. The court quashed the order and directed that the society may proceed with the election of Chairman as per its bye-laws, subject to any other legal proceedings. The court also clarified that the Election Authority could not restrain the Board from holding its meeting.
Headnote
A) Co-operative Law - Election of Chairman - Powers of Election Authority under Section 73CA - The State Co-operative Election Authority appointed an administrator to conduct election of Chairman of a co-operative society and restrained the Board of Directors from holding its meeting. The Court held that Section 73CA does not empower the Election Authority to appoint an administrator for election of Chairman when the bye-laws provide for election by the Board of Directors. The power under Section 73CA is limited to conducting elections of the Board of Directors and not internal elections like Chairman. (Paras 1-20) B) Co-operative Law - Bye-laws - Interpretation - The bye-laws of the society provided that the Chairman shall be elected by the Board of Directors from amongst themselves. The Court held that such internal election is not an 'election' under the Act and Rules, and the Election Authority has no jurisdiction to interfere. The society's bye-laws must be respected. (Paras 10-15) C) Co-operative Law - Restraint Order - Validity - The Election Authority's order restraining the Board of Directors from holding its meeting for election of Chairman was held to be without jurisdiction and ultra vires the Act. The Court quashed the impugned order and allowed the society to proceed with the election as per its bye-laws. (Paras 16-20)
Issue of Consideration
Whether the State Co-operative Election Authority under Section 73CA of the Maharashtra Co-operative Societies Act, 1960 has the power to appoint an administrator to conduct the election of the Chairman of a co-operative society and to restrain the Board of Directors from holding its meeting for such election, when the society's bye-laws provide for election of Chairman by the Board of Directors.
Final Decision
The court quashed the impugned order dated 13 August 2020 passed by Respondent No.3. The court directed that the society may proceed with the election of Chairman as per its bye-laws, subject to any other legal proceedings. The court also clarified that the Election Authority could not restrain the Board from holding its meeting.
Law Points
- Interpretation of Section 73CA of the Maharashtra Co-operative Societies Act
- 1960
- powers of State Co-operative Election Authority
- election of Chairman of co-operative society
- bye-laws of society
- appointment of administrator for election
- restraint on holding board meeting
