Case Note & Summary
The judgment pertains to two writ petitions filed by M/s. Tejas Constructions (a partnership firm) and ATV Projects India Ltd. (a company) challenging an order dated 25/12/1999 passed by the Authorised Enquiry Officer appointed under Section 88 of the Maharashtra Cooperative Societies Act, 1960. The Enquiry Officer had directed an enquiry against the petitioners, who were contractors and suppliers to the Akola Zilla Sahkari Sakhar Karkhana Ltd., a cooperative sugar factory. The petitioners objected to the enquiry on the ground that they were not members, past members, or office bearers of the society and thus could not be proceeded against under Section 88. The court examined the scope of Section 88, which empowers an enquiry into the affairs of a cooperative society only against its members, past members, and office bearers. The court noted that the petitioners were merely contractors and suppliers, and the preliminary enquiry under Section 83 could not expand the ambit of Section 88 to include them. The court held that the enquiry against the petitioners was without jurisdiction and quashed the impugned order. The petitions were allowed, and the enquiry against the petitioners was set aside.
Headnote
A) Cooperative Societies Act - Enquiry under Section 88 - Scope of Enquiry - Section 88 of the Maharashtra Cooperative Societies Act, 1960 - The court considered whether an enquiry under Section 88 can be conducted against contractors and suppliers who are not members, past members, or office bearers of the society. Held that the enquiry under Section 88 is limited to members, past members, and office bearers, and cannot be extended to third parties like contractors or suppliers. (Paras 1-7)
B) Cooperative Societies Act - Preliminary Enquiry under Section 83 - Basis for Section 88 Enquiry - Sections 83 and 88 of the Maharashtra Cooperative Societies Act, 1960 - The court examined whether a preliminary enquiry under Section 83 can form the basis for initiating an enquiry under Section 88 against persons not covered by Section 88. Held that the report under Section 83 cannot expand the scope of Section 88 to include persons who are not members, past members, or office bearers. (Paras 3-7)
C) Cooperative Societies Act - Natural Justice - Right to be Heard - Section 88 of the Maharashtra Cooperative Societies Act, 1960 - The court addressed the issue of whether persons who are not members, past members, or office bearers can be subjected to an enquiry under Section 88 without being given an opportunity to be heard. Held that such persons cannot be proceeded against under Section 88 as they are not within the ambit of the provision, and the enquiry against them is without jurisdiction. (Paras 5-7)
Issue of Consideration
Whether an enquiry under Section 88 of the Maharashtra Cooperative Societies Act, 1960 can be initiated against persons who are not members, past members, or office bearers of the cooperative society, but are merely contractors or suppliers.
Final Decision
The court allowed both writ petitions and quashed the order dated 25/12/1999 passed by the Authorised Enquiry Officer. The enquiry under Section 88 against the petitioners was set aside as being without jurisdiction.
Law Points
- Section 88 enquiry limited to members
- past members
- and office bearers
- contractors and suppliers not covered
- preliminary enquiry under Section 83 cannot expand scope of Section 88
- natural justice requires notice and opportunity to be heard before being subjected to enquiry.
Case Details
2010 LawText (BOM) (06) 148
Writ Petition No. 183 of 2000 with Writ Petition No. 815 of 2000
Shri R. S. Agrawal for petitioner, Mr. D. B. Patel, A.G.P. for respondent No. 1, Smt. I. L. Bodade with Mr. Gopal Mishra for respondent No. 2
M/s. Tejas Constructions (in WP 183/2000) and ATV Projects India Ltd. (in WP 815/2000)
Mr. Vandan Kohade, Authorised Enquiry Officer, and Akola Zilla Sahkari Sakhar Karkhana Ltd.
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Nature of Litigation
Writ petitions challenging an order of the Authorised Enquiry Officer directing enquiry under Section 88 of the Maharashtra Cooperative Societies Act, 1960 against contractors and suppliers of a cooperative sugar factory.
Remedy Sought
Quashing of the order dated 25/12/1999 passed by the Enquiry Officer and setting aside the enquiry proceedings against the petitioners.
Filing Reason
The petitioners, being contractors and suppliers, were not members, past members, or office bearers of the society and thus could not be subjected to an enquiry under Section 88 of the Act.
Previous Decisions
The Enquiry Officer had rejected the petitioners' objection to the continuation of the enquiry.
Issues
Whether an enquiry under Section 88 of the Maharashtra Cooperative Societies Act, 1960 can be initiated against persons who are not members, past members, or office bearers of the cooperative society.
Whether a preliminary enquiry under Section 83 can form the basis for an enquiry under Section 88 against such persons.
Submissions/Arguments
Petitioners argued that they are contractors and suppliers, not members, past members, or office bearers, and thus cannot be proceeded against under Section 88.
Respondents contended that the enquiry was based on a preliminary enquiry under Section 83 and that the petitioners were responsible for misdeeds.
Ratio Decidendi
An enquiry under Section 88 of the Maharashtra Cooperative Societies Act, 1960 is limited to members, past members, and office bearers of the cooperative society. Contractors and suppliers who are not within these categories cannot be subjected to such an enquiry. The preliminary enquiry under Section 83 cannot expand the scope of Section 88.
Judgment Excerpts
The petitioners herein are challenging the order passed by Authorised Enquiry Officer dated 25/12/1999 thereby directing to conduct enquiry as contemplated by Section 88 of the Maharashtra Cooperative Societies Act, 1960.
The petitioners contend that they are either the contractors appointed by the office bearers of the sugar factory or the suppliers of machinery and equipments and they cannot be proceeded with and also cannot be held responsible for any act or omission alleged against them in an enquiry initiated under Section 88 of the Act.
The enquiry under Section 88 of the Act is limited to the members, past members, and office bearers of the society. The petitioners are not members, past members, or office bearers and thus cannot be subjected to such enquiry.
Procedural History
The Cooperative Department initiated a preliminary enquiry under Section 83 of the Maharashtra Cooperative Societies Act, 1960 against the office bearers of Akola Zilla Sahkari Sakhar Karkhana Ltd. Based on the report, an enquiry under Section 88 was ordered against the petitioners (contractors and suppliers). The petitioners objected, but the Enquiry Officer rejected their objection on 25/12/1999. The petitioners then filed writ petitions in the High Court challenging that order.
Acts & Sections
- Maharashtra Cooperative Societies Act, 1960: 83, 88
