22 July 2019


Judgments

High Court of Bombay

Taluka Co-operative Education Society Ltd. Vs. State of Maharashtra and Ors.

MANU/MH/2106/2017

15.09.2017

Trusts and Societies

In case of a Society, the will of majority of the members of Society is supreme

By present writ petition, the Petitioner-Educational Institution seeks quashing of communication dated 19th August, 2016, sent by Divisional Joint Registrar, Co-operative Societies, Nashik and directions to Commissioner for Co-operation, Co-operative Societies, Pune and Divisional Joint Registrar, Co-operative Societies, Nashik Division, Nashik, the Respondents No. 2 and 3 herein, to expeditiously decide the proposal for de-registration of society under the provisions of Maharashtra Co-operative Societies Act, 1960. The Petitioner also seeks declaration that, its proposal for de-registration is maintainable and seeks directions to Respondents No. 2 and 3 to decide it on its own merits within a stipulated time.

Section 21A of the Act was introduced by Maharashtra 20 of 1986 amendment in order to provide right to the societies to get themselves de-registered or even for the Registrar to de-register the societies for the reasons stated therein. It cannot be disputed that, the Petitioner-society is presently governed by two different enactments namely; Maharashtra Cooperative Societies Act and Maharashtra Public Trust Act. The object to form the society is to provide education to the persons in the vicinity and the said object is no way going to be affected by de-registration of the society under MCS Act. The Petitioner is required to fulfill the obligations and perform the duties under Maharashtra Cooperative Societies Act as well as under the Maharashtra Public Trust Act, when the institution is one and the same. If the members of the society take a decision to de-register the society and opt to be governed by only Maharashtra Public Trust Act and authorities therein, the decision cannot be said to be contrary to the object of the formation of Cooperative Societies. In fact, the provisions of Maharashtra Public Trust Act can take care of the activities of the trustees and the management to see that the object of the public trust is achieved and there is proper control over the management to prevent any mismanagement.

In case of a Society, the will of majority of the members of Society is supreme. If they decide to get themselves not to be governed by the Maharashtra Cooperative Societies Act and to be governed only by provisions of Maharashtra Public Trust Act, there is nothing wrong. The decision deserves to be respected subject to verification of the facts and following the due procedure.

High Court is of the view that, the present case certainly falls under Section 21A of Act in general and under the words "where the work of Society is completed or exhausted" in particular as the Institute is now governed by Maharashtra Public Trust Act. View taken by Respondent No. 3-Divisional Joint Registrar, Cooperative Societies, in its order dated 19th August, 2016 cannot be accepted. It is held that, the Respondents were bound to consider the proposal of the Petitioner for de-registration of the Society under Section 21A of the Act, subject to necessary procedure and verification of the facts.

It is for the Respondent to take appropriate decision in the light of Section 21A of Act on the proposal submitted by the Petitioner. While taking such decision, the Respondents shall follow the procedure contemplated under the Act and shall also verify the factual aspects if there are any doubts about the correctness thereof. If necessary, the Respondents can send their representative for verifying the wishes of the members by attending Annual or Special General Body Meeting.

It is also to be noted that, the Petitioner will have to pass appropriate resolution for transferring the reserve funds of the Society to the public trust and also to transfer the personal interest of the members of the society to the public trust. They will have to seek permission of the Registrar in this regard. These are all points which can be taken care of by the Registrar while considering the proposal of the petitioner for de-registration under Section 21A of Act.

The order passed by Respondent No. 3, holding that, the proposal of the Petitioner for de-registration of the society is not covered under Section 21 or 21A of Act, is set aside and it is declared that the proposal of the Petitioner for de-registration of the Society squarely falls under Section 21 and 21A of Act. Petition allowed.

Tags : De-registration Proposal Maintainability

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