Shyam Narain Shukla vs State of U.P.and others

Om Prakash, J.—Both these writ petitions involving a common question of law which were heard together with the consent of learned counsel for the parties, are being disposed of by a common judgment.

The short question for consideration in these wit petitions is as to what is the term of the office of the committee of management of the Ordinance Equipment Factory Prarambhik Sahkari Bank Ltd., admittedly, a cooperative society.

Rule 445 of the Uttar Pradesh Cooperative Societies Rules, 1968 (Rule, briefly) as amended by the Uttar Pradesh Cooperative Societies (Sixteenth Amendment) Rules, 1985 states that except as otherwise provided in Rules 406, 433 and 435 the term of the Committee of Management of a Cooperative Society shall be three years and that the term of the office of the elected members of the Committee of Management shall be coterminus with the term of the Committee of Management. Rule 44 was earlier amended by the Uttar Pradesh Cooperative Societies (Twentieth Amendment) Rules, 1981. In the year 1981 before amendment Rule 445 existed as follows :

Except as otherwise provided in Rules 406, 433 and 435, the term of the Committee of Management of a Cooperative Society shall be three years. The term of the office of an elected member of the Committee of Management shall be coterminus with the term of the Committee of Management."

In the year 1981, the aforesaid Rule was amended as follows :

"Except as otherwise provided in Rule 406, 433 and 435, the term of the Committee of Management of a Cooperative Society shall be three Cooperative years. The term of the office of the elected members of the Committee of Management of a Cooperative Society shall be coterminus with the term of the Committee of Management "

5 From the above reproduction of Rule 445, it if manifest that prior to the amendment in the year 1981 the term of the office of the Commitee of Management was three years. After the amendment, the words "three years" were substituted by the words "three Cooperative years". Again by virtue of the amendment made in the year 1985 the term of the Committee of Management was made three years.

Section 2 clause (i) of the Uttar Pradesh Cooperative Societies Act. 1965 (Act, for short) was amended by the Uttar Pradesh Cooperative Societies (Amendment) Act, 1989. By virtue of amended section 2 clause (i) ''Cooperative year'' means the year commencing on the first day of April and ending on 31st day of March next following. Prior to the Amending Act of 1989, section 2 clause (i) of the Act reads as follows :

"Cooperative year means the year commencing on the first day of July aid ending on the thirtieth day of June next following."

Sri R N Upadhyaya, learned counsel for Shyam Narain Shukla who has filed writ petition no 24599 of 1994 urged that the first year of the Committee of Management of the aforesaid Cooperative Bank which was admittedly, elected on 7.12.91, ended on 31st March, 1992 in view of the Amending Act, 1989 and that the full term of three years had come to an end on 31st March, 1994 and thereafter the Committee of Management was not entitled to continue. On the other hand, the submission of Sri Burman, learned counsel for the Committee of Management is that after the amendment made during the year 1985 the term of the Committee of Management is three years simpliciter and not three cooperative years within the meaning of Rule 445. His submission is that the word ''year'' having not been defined either under the Act or under the Rules, the Court may take recourse to the definition of the word ''year'' as given under section 4, subsection (50) of the U. P. General Clauses Act, 1904. Under section 4 subsection (50) of the said General Clauses Act, ''Year'' shall mean a year reckoned according to the British calendar which is from January to December. Sri Burman, therefore, argued that the term of the Committee of Management would come to an end on 6th December, 1994 and not before.

The question for consideration, therefore, is whether the term of the Committee of Management will be computed according to the British calendar as urged on behalf of the Committee of Management or according to the financial year as urged on behalf of Sri Shyam Narain Shukla, petitioner in one of the writ petition. Rule 445 as amended in 1985 provides that the term of the Committee of Management of a Cooperative Society shall be three years. The word ''year'' has not been defined either under the Actor under the Rules and, therefore, it is nothing but appropriate to take recourse to section 4 subsection (50) of the U. P. General Clauses Act, 1904 which defines the word ''year'' meaning as the year reckoned according to the British calendar. If the term of three years is reckoned as per British calendar than that would come to an end on 6th December, 94. We see no force in the submission of Sri Upadhyay that it is the financial year and not the year as per the British calendar which is relevant for reckoning the terms of the Committee of Management. Prior to the amendment made during the year 1981, Rule 445 set out the term of the Committee of Management as three years which was then substituted by three Cooperative years. Again Rule 445 was amended in the year 1985 and then the words ''three Cooperative years" were substituted by the words "three years". By the amendment made in the year 1985, the subordinate legislation relegated to the pre 1981 Amendment position. The amendments made by subordinate legislation in the years 1981 and 1985 were significant, The words three Cooperative years and three years ''cannot be synonymous in any way and they connote definite meaning. Cooperative year before the amendment of 1989 commenced from 1st July and ended on 30th June in a year. The word ''year'' without the prefix cooperative as introduced by the amendment of 1985 in Rule 445, cannot be said to be the year beginning from 1st July and ending on 30th June.

The submission of Sri Upadhyay is that the amendment of 1985 made in Rule 445 overreaches the provisions as contained in Section 32 of the Act and, therefore, the same is invalid. This submission is devoid of any merit, inasmuch as section 32 does not lay down the term of the Committee of Management but subsection (1) of section 32 simply provides that the meeting of the general body of a Cooperative Society shall be held once in a Cooperative year within such period as may be prescribed for the purposes, enumerated in clauses (a) to (h). When section 32 does not stipulate the term of the Committee or'' Management, it cannot be said that amendment of 1985 made in Rule 445 substituting the words ''three Cooperative year'' by the words ''three year'' is illegal. Such amendment has not overstepped or violated any statutory provision. Finding if difficult to support his contention that the financial year and not the year as per the British calendar is germane to reckon the term of the Committee of Management, Sri Upadhyay made a submission, no doubt full of ingenuity, that Rule 445 as amended in 1985 being inconsistent to the byelaws is illegal and inoperative. Our attention has been drawn to the byelaws of the Ordnance Equipment Factory Prarambhik Sahkari Bank Ltd., Kanpur. Such bylaws referred to three Cooperative years which was the term of the Committee of Management after and before the amendments made in Rule 44'' in the years 1981 and 1985. It is not shown to us as to when the byelaws being relied on during the arguments by Sri Upadhyay were made and whether the byelaws relating to the term of the Committee of Management continued to be in force even after the amendment of 1985 in Rule 445. Assuming that the byelaws continued to refer to the term of three Cooperative years, the question that arises for consideration is whether the byelaws can override the provisions of Rule 445 of the Rules, which are statutory in nature. Subsection (1) of section 130 of the Act provides that the State Government may make rules to carry out the purposes of the Act. Section 130 clause (ii) states that in particular and without prejudice to the generality of the power under subsection (i), rules to be made under this section, may provide for the matters in respect of which a Cooperative Society shall or may make byelaws. From this it is manifest that the rules to be framed under section 130 by the State Government, may specify the field for making the byelaws. Byelaws can be made only in the matters relating to a Cooperative Society as specified by the State Government, that is, the rule making authority. Rule 18 falling in Chapter 111 of the Rules provides that the Registrar may frame model byelaws for each class of society or societies. Rule H states that the model byelaws framed by the Registrar, may be adopted by such Society with such modification, if any, as may be considered necessary by the Society having regard to its requirement. Rule 15 which is more significant for the purposes of instant writ petition; mandates that the byelaws of a Cooperative Society shall subject to the provisions of the Act and the Rules cover the matters enumerated in clauses (i) to clause From Rule 15, it is abundantly clear that the byelaws of a Cooperative Society shall be subject to the provisions of the Act and Rules. It means that the byelaws cannot be kept on a higher pedestal than the Rules. The model byelaws to be framed by the Registrar being subject to the Act and the Rules cannot lay down anything contrary to the Rules. We have already pointed out that Rule 445 clearly sets out three years being the term of the Committee of Management. Three Cooperative years and three years are not just the same but different connotations under the law. If Rule 445 provides three years as the term of the Committee of Management, the byelaws cannot provide the term of the Committee of Management different from the term provided under the Rules and if the byelaws provide the term of a Cooperative Society contrary to the Rules, then the Rules and not the byelaws would prevail. In short, the byelaws being subject 10 the Rules cannot override the Rules. The byelaws to the extent they are inconsistent to the Rules, will remain inoperative and unenforceable.

Rules, Regulations, Schemes, Byelaws, orders made under Statutory power are all comprised in delegated legislation. Subordinate legislation is made by the person or body by virtue of the power conferred by the statute. The byelaws are made in the main by local authorities or similar bodies or by statutory or other undertakings for regulating the conduct of the persons within their areas or resorting to their undertakings. Subordinate legislation have, if validly made, full force and effect of a statute. But that does not mean that authority empowered to frame byelaws is free to make byelaws contrary to the rules. Infact, the matters for which bye laws may be framed are specified by the rule making authority and the byelaws framed by a given authority, are subject to the Rules and the Act. Authority empowered to frame the byelaws cannot cover the field which is not earmarked to it. When Rule 445 clearly provides the term of the Committee of Management and when Rule 15 does not specifically permit the Registrar to frame byelaws over and again in respect of the term of the Committee of Management, the Registrar is not empowered at all to frame byelaws as to the term of the Committee of Management, let alone frame the byelaws which are inconsistent. The reason is not far to seek as to why a matter relating to the term of the Committee of Management is not specified under Rule 15 of the Rules. When Rule 445 already lays down the term of the Committee of Management, it was neither expedient nor necessary to confer such powers again on the Registrar to frame byelaws in regard to the term of the Committee of Management. This being so, the term of the Committee of Management will be the one as provided under Rule 445 and not that which is inconsistently provided under the byelaws.

There is nothing on the record to show that for smooth and convenient functioning of the Bank, three cooperative years and not three years will he necessary and. therefore, the byelaw specially provides three cooperative years being the term of the Committee of Management. What appears to us is that the byelaws provided three cooperative years as the term of the Committee of Management when is was consistent to the Rules and that no follow up action was there after the amendment of 1985 when the term of three cooperative years was substituted by three years.

In support of his contention that the financial year and not the year according to the British calendar will be the basis of reckoning the term of the Committee of Management, Sri Upadhyay relied on Sri Ram Pyare Chowdhary and others vs. Stale of U. P. & others, (AIR 1982 SC 831). Infact this question did not arise in Sri Ram Pyare Chowdhary (Supra) and the facts of that case are quite different and, therefore, the ratio of that case cannot be applied to the writ petitions in hand. In Ram Pyare Chowdhary (Supra), election of the Committee of Management was held on 11.9.79 but the result on account of injunction granted by the Court was declared on 18.1.80. The office bearers were elected on 29.1.80. The Registrar had issued a teleprinter message declaring that the term had come to an end on 30.6.81. Amendment in Rule 445 having been brought in by the notification dated June 30,1981 substituting the term of three years by three Cooperative years (each Cooperative year being analogous to financial year), the Court held that the term of the Committee of Management would commence from 1.7.79 and on 30.6.80 and, therefore, the term of three years would expire on 30.6.82. From these facts, it is amply clear that in Sri Ram Pyare Chowdhary(Supra), the question for consideration was not the one whether the term of the Committee of Management would be reckoned as per the year according to British calendar or as per the Cooperative year analogous to financial year. This authority is, therefore, misplaced by Sri Upadhyay.

For the reasons, we reject the contention of Sri Upadhyay and accept the contention of Sri Burman.

Admitted facts are that, election of the Committee of Management of the Cooperative Society in question was held on 7.12.91. Respondent no. 3 being under the erroneous impression that the term of the Committee of Management ended on 30th June. 1974 in view of the Cooperative year as denned prior to the amendment of 1985, he passed an order dated 1.7.92 (Annexure 2 to the first writ petition) appointing one Sri Virendra Sahu Dixit as Administrator of the Society. When he realised the mistake that the byelaws are subject to the Rules and that according to the Rules three years would come to an end on 6th December 1994, respondent no 3 passed impugned order dated 13.7.94 (Annexure 6 to the first writ petition) cancelling the order dated 1.7.94 and thereby enabling the Committee of Management to continue to function. It is then Sri Shyam Narain Shukla who is a member of the Ordnance Equipment Factory Prarambhik Sahkari Bank Ltd., Kanpur Nagar, filed the first writ petition for quashing impugned order dated 1 3.7.94 (Annexure 6 to that writ petition). Second writ petition was filed by the Committee of Management in queer circumstances. By order dated 28.7.94, a division bench of this Court of which on of us (Om Prakash, J.) was a member, passed an interim order that the Administrator will continue to function until further orders or until the election of the Committee of Management is held whichever is earlier. This interim order, in short, stayed the operation of the impugned order dated 13.7.94. Giving effect to the interim order dated 28.7.94 the District Assistant Registrar passed an order dated 3.8.1994 (Annexure 8 to the second writ petition) enabling the Administrator to function. Instead of making an application for vacating the interim order dated 28.7.94, the Committee of Management which was respondent no 4 in the first writ petition, hastened to file the second writ petition for quashing order dated 3.894 passed by the District Assistant Registrar giving effect to the Court''s interim order dated 28.7.94.

In view of the foregoing discussion, the Committee of Management having been elected on 7.12.91 is entitled to continue to function upto 6.12.94 and, therefore, the order appointing the Administrator deserves to be quashed and if that is so, impugned order dated 3.8.94 passed subsequently by the District Assistant Registrar giving effect to the Court''s interim order dated 28.7.94, also deserves to be quashed.

In the result, the first writ petition no. 24599 of 1994 fails and is dismissed and the second writ petition no. 28896 of 94 succeeds and is allowed and the impugned order dated 3894 (Annexure 8 to the second writ petition) is quabed. The interim order dated 28.7.94 passed in the first writ petition is hereby vacated. In the circumstances of the case, we do not order costs.

(Petition dismissed.)