Case Note & Summary
The petitioners, Neeta Ratnakar Salunke and her two minor daughters, were members of the Nashik Co-operative Credit & Capital Society Limited, which was under liquidation. They sought to transfer their shares to a third party and applied to the Deputy Registrar, Co-operative Societies, Nashik, under Section 22 of the Maharashtra Co-operative Societies Act, 1960, for permission. The Deputy Registrar, by order dated 12 April 2013, granted permission but imposed a condition that the transfer would be subject to a no objection certificate from the liquidator. The petitioners challenged this condition before the Divisional Joint Registrar, Nashik, who dismissed their revision application on 19 October 2015, upholding the Deputy Registrar's order. Aggrieved, the petitioners filed a writ petition under Article 227 of the Constitution of India before the Bombay High Court. The court examined the scope of Section 22 of the Act, which empowers the Deputy Registrar to grant or refuse permission for transfer of shares, but does not authorize the imposition of any condition, let alone one requiring a no objection certificate from the liquidator. The court noted that the society was in liquidation and the liquidator had no role in the transfer of shares under Section 22. The court held that the Deputy Registrar acted without jurisdiction by imposing such a condition, and the revisional authority erred in not correcting this illegality. Consequently, the court quashed the condition and directed the Deputy Registrar to issue a fresh permission without the condition. The petition was allowed, and rule was made absolute.
Headnote
A) Co-operative Law - Transfer of Shares - Jurisdiction of Deputy Registrar - Section 22 of Maharashtra Co-operative Societies Act, 1960 - The Deputy Registrar, while granting permission for transfer of shares under Section 22, cannot impose a condition requiring a no objection certificate from the liquidator, as such condition is not contemplated by the Act and exceeds the statutory power. Held that the Deputy Registrar acted without jurisdiction. (Paras 5-7) B) Co-operative Law - Revisional Powers - Section 154 of Maharashtra Co-operative Societies Act, 1960 - The Divisional Joint Registrar, while exercising revisional jurisdiction, failed to correct the error of law committed by the Deputy Registrar in imposing an extraneous condition. Held that the revisional authority ought to have set aside the illegal condition. (Paras 8-9)
Issue of Consideration
Whether the Deputy Registrar under Section 22 of the Maharashtra Co-operative Societies Act, 1960 has jurisdiction to impose a condition requiring a no objection certificate from the liquidator for transfer of shares of a co-operative society in liquidation.
Final Decision
The court allowed the writ petition, quashed the condition imposed by the Deputy Registrar requiring a no objection certificate from the liquidator, and directed the Deputy Registrar to issue a fresh permission for transfer of shares without such condition. Rule made absolute.
Law Points
- Jurisdiction of Deputy Registrar under Section 22 of Maharashtra Co-operative Societies Act
- 1960
- Scope of revisional powers under Section 154
- Transfer of shares in co-operative society in liquidation
- Condition of no objection certificate from liquidator
