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Judgment
P. Sathasivam, J.—A Five Judge Bench of this Court in M. Thanikkachalam v. Madhuranthagam Agricultural Co-operative Society 2001
WLR 1: 2001 (1) LLJ 285, has held that no writ will lie against a Co-operative Society, since it is not an instrumentality of the State within the
meaning of Article 12 of the Constitution of India. While hearing Writ Appeal No. 1573 of 1998 filed against the order of learned single Judge
dismissing the writ petition that no writ will lie against a Co.operative Society, the then First Bench (Markandey Katju, C.J. & F.M.K.,J.) doubting
the Five Judge Bench decision, by order dated 09.08.2005, referred the following question to be decided by a Larger Bench.
Whether the decision of the Five-Judge Bench of this Court in M. Thanikkachalam v. Madhuranthakam Agricultural Co-operative Society 2001
WLR 1 holding that no writ will lie against a co-operative society is correct in law?
Pursuant to the same, the said question is referred before a Full Bench of us consisting of Three Judges.
Before considering the said question and whether the decision of the Five Judge Bench of this Court in M. Thanikkachalam''s case (supra)
needs to be reconsidered by a Larger Bench, it is useful to refer the details mentioned by the Division Bench in the order of Reference dated
09.08.2005.
This writ appeal has been filed against the order of the learned single Judge dated 12.2.1989. The learned single judge has held that since the
second respondent is a co-operative society, no writ will lie against it.
A Five-Judge Bench of this Court in M.Thanikkachalam v. Madhuranthagam Agricultural Co-operative Society 2001 WLR 1 has held that no
writ will lie against a co-operative society since it is not an instrumentality of the State within the meaning of Article 12 of the Constitution. With due
respect to the aforesaid Five-Judge Bench decision, we are of the respectful opinion that it needs to be reconsidered. There can be two kinds of
co-operative societies - one which can be regarded as an instrumentality of the State within the meaning of Article 12 of Constitution of India, and
the other which is not an instrumentality of the State within the scope of Article 12 of the Constitution. In our opinion, while a writ will lie against a
co-operative society falling under the first category, no writ will lie against the second category of co-operative societies. Whether a co-operative
society is an instrumentality of State under Article 12 of the constitution or not will depend upon the various tests laid down by the Supreme Court
in various decisions, e.g. Whether there is deep and pervasive control of the Government, extent of the shareholding of the Government, etc. In our
opinion it cannot be laid down as a universal proposition that no writ can ever lie against a co-operative society. It will depend on the nature of the
society and various other factors. Also the concept of instrumentality of State is not confined to entities created by the statute vide The Mysore
Paper Mills Ltd. Vs. The Mysore Paper Mills Officers'' Association and Another, .
In U.P. State Cooperative Land Development Bank Ltd. Vs. Chandra Bhan Dubey and Others, , the Supreme Court held that if the body is a
State under Article 12 of the Constitution of India, a writ will lie against it.
In Zoroastrian Co-operative Housing Society Limited and Another Vs. District Registrar Co-operative Societies (Urban) and Others, the
Supreme Court observed as follows:
A Co-operative society is not a State unless the tests indicated in Ajay Hasia and Others Vs. Khalid Mujib Sehravardi and Others, case are
satisfied.
This observation indicates that sometimes a society can be ''State'' under Article 12 of the Constitution. Moreover, in Pradeep Kumar Biswas and
Others Vs. Indian Institute of Chemical Biology and Others, the Supreme Court observed that the tests formulated in Ajay Hasia''s case are not a
rigid set of principles. The question in each case would be whether in the light of the cumulative facts as established, the body is financially,
functionally and administratively dominated by or under the control of the Government. Such control must be particular to the body in question and
must be pervasive.
In Gayatri De v. Mousumi Cooperative Housing Society Ltd. (2004) 5 SCC 19 ( Vide Para 50) the Supreme Court referred to the tests to
decide whether a society is a State under Article 12 of the Constitution or not. If there is no deep and pervasive control of the Government, the
society will not be ''State'' under Article 12 vide General Manager, Kisan Sahkari Chini Mills Ltd., Sultanpur, U.P. Vs. Satrughan Nishad and
Others, , Federal Bank Ltd. v. Sagar Thomas and Ors. (2003) 7 Sup 22, G. Basi Reddy Vs. International Crops Research Instt. and Another, ,
etc.
There are various other decisions of the Supreme Court which we need not quote here. However, we are of the opinion that the decision of the
Five-Judge Bench of this Court in M. Thanikkachalam''s case (supra) needs to be reconsidered by a larger Bench to decide the following question:
Whether the decision of the Five-judge Bench of this Court in M. Thanikkachalam v. Madhuranthakam Agricultural co-operative society 2001
WLR 1 holding that no writ will lie against a co-operative society is correct in law?
It is clear from the order of Reference by the Division Bench that the decision of the Five-Judge Bench of this Court in M. Thanikkachalam''s case
(supra) holding that no writ will lie against the co-operative society, since it is not an instrumentality within the meansing of Article 12 of the
Constitution needs to be reconsidered.
At the foremost, Mr. V. Chandrasekaran, learned Counsel appearing for the appellant pointed out that Five-Judge Bench decision of this Court
made in M. Thanikkachalam''s case (supra) cannot be doubted by a Division Bench, as stated in their order of Reference dated 09.08.2005.
According to him, judicial discipline and propriety demands the decision of Five-Judge Bench is binding on the Division Bench as well as the Full
Bench. He further contended that even if there is any doubt arises in respect of the decision of Five Judge Bench, similar coordinate Five-Judge
Bench alone can consider and if the said Bench doubts the decision, the same may be referred to a Larger Bench and not by any other smaller
Benches, such as Division Bench and Full Bench. In support of the above contention, he relied on two Constitution Bench decisions of the
Supreme Court, viz., (i) Pradip Chandra Parija and Others Vs. Pramod Chandra Patnaik and Others, and (2) Central Board of Dawoodi Bohra
Community and Another Vs. State of Maharashtra and Another, .
Mr. D. Krishnakumar, learned Special Government Pleader appearing for the first respondent, Mr. C. Selvaraju, learned senior counsel
appearing for the second respondent also reiterated the same view.
Before considering the doubt raised on the order of Reference made by the Division Bench, it is useful to refer the question raised before the
Five-Judge Bench. It is seen from para 11 of the decision in M. Thanikkachalam''s case (supra), in view of difference of opinion, a Larger Bench
has been constituted to answer the question put forth as to, whether the decision in Tamilarasn''s case 1989 (1) LLJ 588 ( R. Thamilarasan Etc. P.
Kannan Etc. v. Director of handlooms and Textiles, Madras and Ors.) which got the seal of approval by two Full Benches of this Court requires
reconsideration. After considering the contentions raised by all the counsel, earlier decisions of this Court as well as the Supreme Court, finally, the
Five-Judge Bench has concluded thus,
In view of the above said provisions of the Statutory remedy, and as discussed herein above, no writ is maintainable against a co-operative
society, as a matter of course.
However, we can attempt a broad classification of cases where this Court can invoke the powers under Article 226. For mandamus to be
issued to direct a person to do some particular thing, it should appertain to his office and should be in the nature of public duty. The person or the
authority on whom the statutory duty is imposed, need not be a public official or an official body (Vide The Praga Tools Corporation Vs. Shri
C.A. Imanual and Others, . If there is contravention of the principles of natural justice, which is required as per the statute and not followed,
however, as pointed out by the Constitution Bench of the Supreme Court in Nagendra Nath Bora and Another Vs. The Commissioner of Hills
Division and Appeals, Assam and Others, , the rules of natural justice vary with the varying constitutions of statutory bodies and the rules
prescribed by the Act under which they function. The question whether or not any rules of natural justice had been contravened should be decided
not under any pre-conceived notions, but in the light of the statutory provisions. Where no such provisions which could be said to have been
contravened by a Tribunal is brought to the notice of the Court, it is no ground for interference either under Article 226 or 227 simply because the
Tribunal had viewed the matter in a light which is not acceptable to the Court. A duty to act fairly can be interpreted as meaning duty to observe
certain aspects of rules and natural justice. Sometimes duty to act fairly can also be sustained without providing for an oral hearing. It will depend
upon the nature of the interest to be affected, the circumstances in which a power is exercised and the nature of sanctions involved therein. Vide
Erusian Equipment and Chemicals Ltd. Vs. State of West Bengal and Another, . When power has been exercised mala fide, arbitrarily or in
absolute disregard of constitutionalism, the Court would intervene vide Somnath Sahu Vs. The State of Orissa and Others, . The monstrosity of the
situation as stated or other exceptional circumstances may cry for timely judicial interdict or mandate vide Rohtas Industries. If the terms of
Contract and Employment Service Rules detrimental to the employees are found to be unconscionable, unfair, unreasonable, against public policy
and public interest and against principle of distributive justice in the context of Parts III and IV of the Constitution, it would be violative of Article
14 of the Constitution vide Central Inland Water Transport Corporation Limited and Another Vs. Brojo Nath Ganguly and Another, can be
instances.
It is also to be noted that this Court while exercising power under under Article 226 of the Constitution, which is discretionary in nature, is a
Court not being a Court of Appeal, more so, when alternative remedy is available under a particular statute, and when the Act and the Rules
provide for so many safety measures, and when the discretionary power of this Court under Article 226 remains in tact, we do not want to
substitute our view that the writ petition against Co-operative Societies is maintainable in the garb of efficacious remedy as a matter of course, as
discussed above. Unless the petitioner is able to show some special circumstances, and the fact that the Authorities concerned while passing orders
have failed to perform their duties imposed by the statute, as discussed, and for the reasons mentioned above, we approve the decisions of the two
Full Benches that no writ petition is maintainable against a Co-operative Society. The same needs no re-consideration. Writ petition against a Co-
operative Society is not maintainable. However, as stated each case depends upon the facts and circumstances of its own. So, to decide the
question of maintainability. The learned single Judge will consider and decide the cases on maintainability in the light of the observations made by us
in this judgement. We answer the reference accordingly.
It is clear from the above conclusion that the Five-Judge Bench approved the decisions of two Full Benches that no writ petition is maintainable
against co-operative society. The Five-Judge Bench has also held that the same needs no reconsideration and retirerated that writ petition against
the co-operative society is not maintainable. The Bench has also clarified that however, it depends upon the facts and circumstances of its own and
to decide the question of maintainability, the matter may be posted before the Court with S.R. Number and thereafter, the learned admission Judge
will consider and decide the case on maintainability in the light of the observation made therein.
In the light of the above background and the ultimate conclusion of the Five-Judge Bench, let us consider the decisions of the Hon''ble Supreme
court relied on by Pradip Chandra Parija and Others Vs. Pramod Chandra Patnaik and Others, , the question that was considered by the Hon''ble
Supreme Court is,
Whether two learned Judges of this Court can disagree with a judgement of three learned Judges of this Court and whether for that reason they
can refer the matter before them directly to a Bench of Five Judges?
After hearing the learned Counsel on either side, including the learned Attorney General, the Supreme Court has concluded,
(6) In the present case the Bench of two learned Judges has, in terms, doubted the correctness of a decision of a Bench of three learned Judges.
They have, therefore, referred the matter directly to a Bench of five Judges. In our view, judicial discipline and propriety demands that a Bench of
two learned Judges should follow a decision of a Bench of three learned Judges. But if a Bench of two learned Judges concludes that an earlier
Judgement of three learned Judges is so very incorrect that in no circumstances can it be followed, the proper course for it to adopt is to refer the
matter before it to a Bench of three learned Judges setting out, as has been done here, the reasons why it could not agree with the earlier
Judgement. If, then, the Bench of three learned Judges also comes to the conclusion that the earlier Judgement of a Bench of three learned Judges
is incorrect, reference to a Bench of five learned Judges is justified.
In the second case, viz., Central Board of Dawoodi Bohra Community and Another Vs. State of Maharashtra and Another, , which is also a
Constitution Bench, after considering all the earlier decisions, including Pradip Chandra Parija and Others Vs. Pramod Chandra Patnaik and
Others, summarised the legal position.
Having carefully considered the submissions made by the learned Senior Counsel for the parties and having examined the law laid down by the
Constitution Benches in the above said decisions, we would like to sum up the legal position in the following terms:
(1) The law laid down by this Court in a decision delivered by a Bench of larger strength is binding on any subsequent Bench of lesser or coequal
strength.
(2) A Bench of lesser quorum cannot disagree or dissent from the view of the law taken by a Bench of larger quorum. In case of doubt all that the
Bench of lesser quorum can do is to invite the attention of the Chief Justice and request for the matter being placed for hearing before a Bench of
larger quorum than the Bench whose decision has come up for consideration. It will be open only for a Bench of coequal strength to express an
opinion doubting the correctness of the view taken by the earlier Bench of coequal strength, whereupon the matter may be placed for hearing
before a Bench consisting of a quorum larger than the one which pronounced the decision laying down the law the correctness of which is doubted.
(3) The above rules are subject to two exceptions:
(i) the above said rules do not bind the discretion of the Chief Justice in whom vests the power of framing the roster and who can direct any
particular matter to be placed for hearing before any particular Bench of any strength; and (ii) in spite of the rules laid down herein above, if the
matter has already come up for hearing before a Bench of larger quorum and that Bench itself feels that the view of the law taken by a Bench of
lesser quorum, which view is in doubt, needs correction or reconsideration then by way of exception (and not as a rule) and for reasons given by it,
it may proceed to hear the case and examine the correctness of the previous decision in question dispensing with the need of a specific reference or
the order of the Chief Justice constituting the Bench and such listing. Such was the situation in Raghubir Singh and Hansoli Devi.
So far as the present case is concerned, there is no reference made by any Bench of any strength at any time for hearing by a larger Bench and
doubting the correctness of the Constitution Bench decision in the case of Sardar Syedna Taher Saifuddin Saheb case. The order dated 18.3.1994
by the two-judge Bench cannot be construed as an order of reference. At no point of time has the Chief Justice of India directed the matter to be
placed for hearing before a Constitution Bench or a Bench of seven Judges.
In the facts and circumstances of this case, we are satisfied that the matter should be placed for hearing before a Constitution Bench (of five
Judges) and not before a larger Bench of seven Judges. It is only if the Constitution Bench doubts the correctness of the law laid down in Sardar
Syedna Taher Saifuddin Saheb case that it may opine in favour of hearing by a larger Bench consisting of seven Judges or such other strength as
the Chief of India may in exercise of his power to frame a roster may deem fit to constitute.
The above two decisions of the Hon''ble Supreme Court make it clear that the decision of Five-Judge Bench is binding on all, viz., Division Bench
as well as Full Bench. Only after the Five-Judge Bench comes to the conclusion that the earlier judgement of Five-Judge Bench is incorrect, then a
reference has to be made to a Larger Bench consisting of Seven Judges. It is also clear that it is only if Five Judge Bench doubts the correctness of
the law laid down in M. Thanikkachalam''s case (supra) it may opine in favour of hearing by a Larger Bench consisting of Seven Judges or such
other strength as the Hon''ble Chief Justice deem fit to constitute.
In the light of the legal position, we are of the view that it is for the Five-Judge Bench of this Court to decide whether the decision of the Five-
Judge Bench in M. Thanikkachalam v. Madhuranthagam Agricultural Co-operative Society 2001 WLR 1 : 2001 (1) LLJ 285 requires
reconsideration or not and depending on their conclusion further orders should be passed. Accordingly, without answering the reference, we direct
the Registry to place the papers before the Hon''ble Chief Justice for constituting a Five-Judge Bench.