TMI Blog1983 (10) TMI 270X X X X Extracts X X X X X X X X Extracts X X X X ..... pression in Sec. 73G(1)(vii) of the Act. Accordingly the election of the members of the Committee and the election of the office-bearers by the Committee of the first respondent would be subject to the provisions of Chapter XI-A and has to be conducted in the manner prescribed in the Chapter. The Committee in which management of the first respondent vests, is designated as Board of Directors. The term of the members of the Board of Directors is five years. The election to the Board of Directors for the period 1981-82 to 1985-86 became due. As required by Sec. 144-C, the Collector having jurisdiction in the matter notified the programme of election on October 29, 1981. At the relevant time, the strength of the Board of Directors was 15 in number. 14 Directors were to be elected by members and one was to be nominated by the Central Co-operative Bank. It is not disputed but in fact conceded that the election programme notified by the Collector did not specify that the two seats on the Board of Directors of the first respondent would be reserved seats; one for the members belonging to the Scheduled Castes or Scheduled Tribes and one for the weaker section of the members who have been g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lied with if reserved seats are filled in by co-option and therefore, there is no error in conducting the election. Accordingly, the order of the Additional Collector was quashed and set aside and the election petition was dismissed. When the petition for special leave to appeal came up before this Court, a direction was given that the matter will be disposed of at the stage of granting special leave as if it is an appeal. Hence this appeal by special leave. Re. C.A. No. 1810/81: The Parbhani District Central Cooperative bank Ltd., the second respondent is a co-operative bank deemed to be registered under the Act. It is a specified society within the meaning of the expression in Sec. 73G. The term of members of the Board of Directors expired. Accordingly, the Collector of Parbhani, the first respondent notified programme of election commencing from March 30, 1981 and ending with the counting of votes and declaration of result on April 24, 1981. The election was held and the result was announced and respondents No. 3 to 12 were declared elected. Thereafter the meeting of the elected members of the Board of Directors is to be convened to elect the office bearers. At that stage, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the members who belong to the Scheduled Castes or Scheduled Tribes and one for the weaker section of the members who have been granted loans from the society of an amount not exceeding ₹ 200 during the year immediately preceding. Sec. 73B further provides that if no such persons are elected or appointed, the committee shall co-opt the required number of members on the committee from amongst the persons entitled to such representation. We may now note the rival contentions. Appellants assert that the reservation in favour of the Scheduled Castes and Scheduled Tribes and weaker section of the members on the committee of the society manifests a statutory attempt giving effect to the provisions of the Constitution especially the one contained in Arts 43 and 46 and has to be given effect as if carrying out the constitutional mandate enshrined in Arts. 15 and 16 of the Constitution. Proceeding along this line, it was submitted that a democratic polity swears by setting up democratic institutions election, neither by appointment nor co-option. It was submitted that the Legislature has clearly indicated its preference in favour of election failing which alone the reserved seats ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sec. 73B. The Act was enacted in 1960 and it repealed the Bombay Co operative Societies Act, 1925. Sec. 73 provides for the vesting of the management of every society in a committee to be constituted in accordance with the Act, the rules and the bye-laws. At the commencement of the Act, there was no provision for reservation of seats in favour of the members of the Scheduled Castes and the Scheduled Tribes and the weaker section of the members. Sec. 73B making reservation obligatory was introduced in the Act by Amending Act 27 of 1969. Why was this specific amendment made ? The working of the Act must have disclosed a sorry state of affairs that even though the cooperative movement was expanding by leaps and bounds, the members of Scheduled Castes and Schedule Tribes or the weaker section of the members of the society were not represented in the committee and had no opportunity to participate in the decision making process, laying down broad policies and management of the society. Art. 43 of the Constitution set the goal that the State shall endeavour to promote cottage industries on an individual or co-operative basis in rural areas. In our onward march of economic independence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st receive such construction as would advance the purpose and intendment underlying the provision making reservation and not thwart it. In the past a method of construction was used to extend a remedial statute called proceeding upon the equity of the statute. In Hay v. Lord Provost of Perth Lord Westbury observed that the mode of construction known as the equity of the statute was very common with regard to our earlier statutes, and very consistent with the principle and manner according to which Acts of Parliament were at that time framed. Undoubtedly, now-a-days this mode of construction has fallen into disuse: Even though the expression the equity of the statute has fallen into disuse, it is still in vogue in somewhat similar form in that if it is manifest that the principles of justice require something to be done which is not expressly provided for in an Act of Parliament, a court of justice will take into consideration the spirit and meaning of the Act apart from the words. In this context, one can recall the words of Jessel M.R. in Re Bethlem Hospital, that the equity of the statute may as well mean, such a thing as construing an Act according to its intent, though ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y indication is to be found in the statute. If the Legislature uses expression if no such persons are elected it indubitably suggests that primarily the reserved seats are to be filled in by election. Failing the election, one can resort to appointment or co-option. The chronology of the methodology by which seats are to be filled in as set out in Sec. 73B clearly manifests the legislative intention. The first and the foremost pride of place is accorded to election. It ought to be so because a representative institution ordinarily must be democratically elected. The section therefore, speaks if no such persons are elected which would mean the authorities charged with a duty to hold election must proceed to arrange for holding the election. If election is held giving out information that there are reserved seats and no candidate is forthcoming to contest for the reserved seats, the Legislature in its wisdom provided that the seats shall not remain vacant but can be filled in by two subsidiary methods such as appointment or co-option which cannot be put on par or equated with election which is a universally recognised method by which representative institutions are set up. Theref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s becomes manifest from the fact that the power to co-opt the members to fill in reserved seats is conferred on the members of the committee i.e. on the Board of Directors. To tersely put the issue in focus, the method of co-option denudes the power of the constituency to elect members and is usurped by a small body like the Board of Directors. The outcome is not difficult to gauge. The committee will co-opt members who would be their puppets, totally ignoring whom the constituency i.e. the general body of members would have elected. If it is the effect of co-option, it could never be equated with election much less accorded precedence over election by the general body of the members that is the constituency. Therefore the submission that method of filling in reserved seats is directory and therefore any one of the three modes can be adopted to comply with the mandatory part of Sec. 73B viz. filling in reserved seats, does not commend to us. Mr. Phadke, learned counsel who appeared for the respondents in one of the appeals urged that the emphasis is on filling in reserved seats and not the mode or method by which the seats are filled in. In this connection, he drew our attention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n unconvinced. Sec. 73B provides a legislative mandate. Rule 61 has a status of subsidiary legislation or delegated legislation. Bye-law of a co-operative society can at best have the status of an Article of Association of a company governed by the Companies Act, 1956 and as held by this Court in Co-operative Central Bank Ltd. and others v. Additional Industrial Tribunal, Andhra Pradesh and Others the bye-laws of a co-operative society framed in pursuance of the provision of the relevant Act cannot be held to be law or to have the force of law. They are neither statutory in character nor they have statutory flavour so as to be raised to the status of law. Now if there is any conflict between a statute and the subordinate legislation, it does not require elaborate reasoning to firmly state that the statute prevails over subordinate legislation and the bye-law if not in conformity with the statute in order to give effect to the statutory provision the rule or bye-law has to be ignored. The statutory provision has precedence and must be complied with. Further the opinion of the Deputy Registrar as expressed in his circular dated February 1, 1979 and his letter dated June 4, 1979 ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whisper in the election programme whether any of the seats were reserved. The omission is glaring and fatal. As pointed out earlier, election has to be held to form the committee. Sec. 73 requires the Collector to hold election in accordance with the Act including Sec. 73B. The failure to hold election in accordance with the Act including Sec. 73B would vitiate the whole election programme from commencement till the end. It would all the more be so because the failure to hold election according to the provisions of the Act which denies an opportunity to the persons who are eligible to get elected to the reserved seats would certainly vitiate the whole election programme. One can safely conclude that the election is held in violation of Sec. 73B. Therefore, in our opinion, the High Court was in error in upholding the election, which is ex facie illegal, invalid and contrary to law. Accordingly both these appeals succeed Civil Appeal arising from S.L.P. No. 7732/83 is allowed and the decision of the High Court is quashed and set aside and the one rendered by the Additional Commissioner is restored. Civil Appeal No. 1810/81 is allowed and the judgment and order of the High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X
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