TMI Blog1983 (10) TMI 282X X X X Extracts X X X X X X X X Extracts X X X X ..... he Bank shall vest in a Board of Directors which will consist of 17 persons: XX XX XX XX XX Provided also that the first Board of Directors of the Bank shall be nominated by the Registrar, Co- operative Societies, Bihar for a period not exceeding one year at a time and not exceeding three Co-operative years in aggregate and that the Registrar, Co-operative Societies may modify the nomination if and when required. The Registrar, Co-operative Societies, Bihar, in exercise of the powers conferred by bye-law 29 by his order dated July 22, 1981 nominated a Committee of Management of 17 members, including the appellant, to be the first Board of Directors of the Co-operative Bank for a period of six months i.e. upto December 31, 1981, or till further orders, whichever was earlier. The Committee of Management was specifically directed to get the election of the Board of Directors of the Central Bank held in accordance with the law within six months of the date of their nomination and the Registrar by the order had reserved his discretion to make changes in the nomination of the Board by the use of expression 'until further orders'. The Registrar by his letter dated Octobe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Board of Directors elected within the extended term, but this was of no avail. On April 21, 1982 the appellant addressed a letter to the then Chief Minister for further extension of the term of the Committee of Management by one year and the then Chief Minister made an endorsement thereon addressed to the Minister (Co-operation) to take necessary steps for extending the term. Again, the Registrar by his order dated June 21, 1982 was forced to extend the term of the nominated Board of Directors for a period of one year i.e. upto May 31, 1983, or until further orders, whichever was earlier. Nevertheless, the Registrar while extending the term again made a direction requiring the Committee of Management to call the general meeting to get the new Board of Directors elected but despite the said direction, no such meeting was ever called. On April 13, 1983, the appellant again addressed a communication to the then Chief Minister for extension of the term of the nominated Board of Directors for a period of one year from June 1, 1983 and the then Chief Minister by his order dated June 13, 1983 extended the term for six months and endorsed the same to the Minister (Co-operation). The Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue any direction to the Registrar as to the manner in which the Board was to be reconstituted. The contention to the contrary advanced by the respondents is that the then Chief Minister had illegally usurped to himself the statutory functions of the Registrar under bye-law 29 and passed the several orders in question to oblige the appellant and a handful of persons who retained their control over the Central Cooperative Bank contrary to the scheme of the Act, and that upon his demitting the office of the Chief Minister, the Minister for Industries was fully justified in issuing a direction to the Registrar for reconstitution of the Board. It is said that the Minister was an important political worker in the district of Vaishalli and he was informally asked to suggest the names of suitable persons to the Registrar for his consideration. The communication referred to was addressed by the Minister to the Commissioner of the Cooperative Department and marked as 'unofficial' merely contained his informal suggestion. The submission is that the Minister is entitled to issue a direction of this nature to a statutory functionary under his department and therefore the Registrar had n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ciety including its office-bearers shall be elected by vote from among the members of the society at the annual general meeting held in accordance with the bye-laws. Bye-law 29 read with the proviso confers power on the Registrar to constitute the first Board of Directors of the Central Cooperative Bank. Under the second part of the proviso to bye-law 29, he has the necessary power to reconstitute such Board. S. 65A of the Act, on which reliance is placed, runs thus: 65-A. Notwithstanding anything to the contrary contained in this Act, the State Government may, of its own motion or on an application made to it by any party aggrieved by the constitution, or reconstitution, amalgamation, election, supersession, liquidation or any other matter concerning working of the society, call for any record of inspection or enquiry made under this Act or proceedings of any matter pending before the Registrar or his subordinate or any person acting under his authority and examine and pass such orders as it may deem fit. We fail to appreciate the propriety of the Chief Minister passing orders for extending the term of the first Board of Directors. Under the Cabinet system of Government ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -based and democratizing the institution rather than to allow them to be monopolized by a few persons. The action of the Chief Minister meant the very negation of the beneficial measures contemplated by the Act. For the same reasons, it must be held that the Minister for Industries also exceeded his own authority in directing the manner in which the new Board of Directors was to be constituted by the Registrar under bye-law 29 by forwarding a list of 7 names to be nominated by him in the reconstituted Board and a further list of 8 names indicating that if the Committee of Management was superseded under another provision, it should consist of those 15 persons. There is no warrant for the submission that the Registrar had no power to reconstitute the first Board of Directors under bye-law 29 or to curtail the extended term. While the proviso to bye-law 29 lays down that the first Board of Directors shall be nominated by the Registrar for a period not exceeding one year at a time and not exceeding three cooperative years in the aggregate, it does not entail the consequence that when the term of the first Board of Directors is extended from time to time, it must necessarily exte ..... 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