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TMI Blog2006 (12) TMI 569X X X X Extracts X X X X X X X X Extracts X X X X ..... e opinion of mine. 4. Constitutional validity of the Chhattisgarh Co-operative Societies (Amendment) Act, 2004 (No. 22 of 2004) has been assailed in all these petitions. For brevity the amendment provided therein is reproduced below: Amendment of Section 49. In Section 49 of the Chhattisgarh Co-operative Societies Act, 1960 (No. 17 of 1961) (hereinafter referred to as the Principal Act): (1) Sub-section (7AA) and (7AAA) shall be omitted. (2) Sub-section (8)(i) and (ii) the following shall be substituted. (8) If the elections are not held before the expiry of the term specified in Sub-section (7A) or the extended term under deleted herein before Sub-section (7AA), all the members of the committee shall be deemed to have vacated their seats and the powers of the committee shall be deemed to have been vested in the Registrar and the Registrar shall hold elections as early as possible: Provided that the Registrar may authorize any officer to exercise the powers of the committee vested in him under this sub-section and the officer so authorized shall exercise such powers from the date of such authorization. History: 5. The M.P. Co-operative Societies Act, 1960 (hencefort ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oresaid provision was amended from time to time and its journey appears to go long way. Vide Amendment Act No. 8 of 1970: Amendment of Section 49.-- In Section 49 of the Principal Act (a) For Sub-section (1) the following subsection shall be substituted, namely: (1) Every society shall within a period of twelve months from the date of last annual general meeting call a general meeting of its members for the purpose of (a) approval of the programme of the activities of the society prepared by the committee for the ensuing year: (b) election, if fallen due in the prescribed manner of the members of the committee; Explanation :- Election of the committee shall be deemed to have fallen due, if the term of the committee according to its bye-laws comes to an end within a period of three months from the date of the annual general meeting or if an election has otherwise fallen due according to rules or bye-laws; (c) consideration of the audit report, if received and the annual report; (d) disposal of the net profit; (e) consideration of any other matter which may be brought forward in accordance with the bye-laws; and (f) to elect delegates, if any, for representing t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , mother's father, mother's brother or sister, father's brother's son or daughter, father's sister's, son or daughter, mother's brother's son or daughter, mother's sister's son or daughter, brother's son or daughter, son's wife, daughter's husband, son's son, daughter, daughter's son or daughter, wife's father or mother, wife's brother or sister, wife's sister's son or daughter, husband's brother, husband's brother's wife, husband's brother's son or daughter. (8) It shall be obligatory on the outgoing committee of a society to hold elections of the incoming committee prior to the period prescribed in its bye-laws. If the committee fails to conduct elections and has not handed over charge on the date prescribed in the bye-laws, all the members of the committee shall be deemed to have vacated their seats and the Registrar shall assume charge till the next elections are held and the new committee takes over charge." Vide Amendment Act No. 5 of 1978: Amendment of Section 49.-- In Section 49 of the Principal Act, (i) in Sub-section (1), (a) after Clause (f), the following claus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w committee takes over charge. Vide Amendment Act No. 7 of 1979: Amendment of Section 49.-- In Sub-section (7-B) of Section 49 of the Madhya Pradesh Co-operative Societies Act, 1960 (No. 17 of 1961) for the words "in any case within a period of one year from the date of the said order" the words and figures "in any case by the 31st December, 1979" shall be substituted. Vide Amendment Apt No. 5 of 1980: Amendment of Section 49.-- In Sub-section (7-B) of Section 49 of the Madhya Pradesh Co-operative Societies Act, 1960 (No. 17 of 1961), for the words and figures "in any case by the 30th June, 1980", the words and figures "in any case by the 31st December, 1980", shall be substituted and shall be deemed to have been substituted with effect from the 12th April, 1979. Vide Amendments Act No. 3 of 1982 & No. 28 of 1982: Amendment of Section 49.- In Section 49 of the Madhya Pradesh Co-operative Societies Act, 1960 (No. 17 of 1961), (a) after Sub-section (7-A), the following sub-section shall be inserted, namely: '(7-AA) The State Government may, by notification, for reasons to be stated therein, extend the term of (i) the Commi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ords "Deputy/Assistant Registrar', shall be substituted; (b) in Sub-section (7) for the existing explanation the following explanation shall be substituted, namely : Explanation.- For the purpose of subsection (7), family members and near relations shall include wife, husband, father, mother, brother, sister, son, daughter, son-in-law, wife's brother, sister's husband, wife's sister, brother's wife and daughter-in-law; (c) for Sub-section (8), the following subsection shall be substituted, namely : (8)(i) It shall be obligatory on the outgoing committee, of society to hold elections prior to the expiration of the term specified in Sub-section (7-A) or extended term under Sub-section (7-AA). The outgoing committee shall apply to the Registrar for appointment of a Returning Officer within a reasonable time which shall not be in any case less than three months before expiration of the term of committee; (ii) If the committee fails to hold elections and has not handed over charge on expiration of the term specified in Sub-section (7-A) or extended term under Sub-section (7-AA) to the Registrar or any officer authorized by him in this behalf, all the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted as a result of any order of the Court or appellate authority, the period during which the society remained under supersession or suspension, as the case may, shall be excluded in computing the period of one full term aforesaid'; (vi) in Sub-section (7-AA), for the words eighteen months', the words 'twenty four months', shall be substituted and shall be deemed to have been substituted with effect from the 7th May, 1988; (vii) after Sub-section (7-AA), the following sub-section shall be inserted namely: (7-AAA) Notwithstanding the expiry of the maximum period eighteen months specified in Sub-section (7-AA), in respect of the committees between the period commencing on the 7th May, 1988 (hereinafter referred to as the said date) and ending on the date of publication of the Madhya Pradesh Co-operative Societies (Amendment) Ordinance, 1988, in Gazette the period in respect of such Committees shall be deemed to have been extended for a period of six months with effect from the said date as if the notification for the extension of the period were issued under such Section (7-AA) on the said date; (viii) Sub-section (7-B) and (7-C) shall be omitted; (ix) after ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tive of whether their term has commenced or not shall stand cancelled on the date specified in the order; (iv) On the issue of an order under Clause (iii), the Registrar shall appoint a person or persons to manage the affairs of the society till the new elections are held and the committee takes charge. The new elections shall be held (a) in case of the order passed before the commencement of the Madhya Pradesh Cooperative Societies (Amendment) Act, 1990 within six months from the date of such commencement; and (b) in case of an order passed after such commencement, within six months from the date of such order. (v) the provisions of Sub-sections (4), (5) and (6) of Section 53 shall apply to the person or persons appointed under Clause (iv) as they apply to the persons appointed under that section.'; (iv) for Sub-section (7-AA), the following sub-section shall be substituted, namely: (7-AA) The State Government may, by notification, for reasons to be stated therein, extend the term of the committee of a society or a class of societies from time to time, for a total period not exceeding twelve months.; (v) for Sub-section (8), the following sub-sections shall be su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hority, the period during which the committee remained under supersession, suspension out of office as the case may be, shall be excluded in computing the period of the term aforesaid. (ii) The term of the representative elected by the committee of the society shall be cotermmus with the term of the committee of the society for which representative is elected: Provided that the representative of a committee shall continue to hold his office till the expiry of the term of the committee of which he is a member. (iii) for Sub-section (8) the following subsection shall be substituted, namely: (8)(i) It shall be obligatory on the outgoing committee of the society to hold elections prior to the expiration of the term under Sub-section (7-A) or extended term under Sub-section (7-AA). The outgoing committee shall apply to the Registrar for holding election within a reasonable time which shall not be in any case less than 90 days before expiration of the term of the committee: Provided that if the outgoing committee has resolved and requested the Registrar to hold election at least 90 days in advance and the Registrar has failed to conduct election on its request the Registrar sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s evident that to maintain democratic value the provision was amended from time to time and even when the Amendment Act No. 14 of 1990, Section 49 (8) was challenged in Court of law from where it was declared ultra vires, subsequently the law was validated by Amendment Act No. 12 of 1994 and before the impugned amendment was made by the State of Chhattisgarh, the amended provisions of 1994 and subsequent amendments thereafter, were in force. 11. It is manifest that earlier when Amendment Act No. 25 of 1988 was not part of the statute, the committee was not authorized to hold offices till fresh election on default being on the part of Registrar to hold election. Again after 1994 amendment, the Registrar's jurisdiction to hold office with some pre-conditions has been restored. In earlier part, term for holding office by committee was not prescribed under the provisions of the Act, subsequently it was 3 (three) years and now it is 5 (five) years. Rules and bye laws are also there, for proper management of the society and a complete scheme and procedure for holding meetings and elections have been led in rules and bye-laws. 12. The petitioners have challenged the impugned amendme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court of Madhya Pradesh in the matter of Anurudh Prasad Shastri (Supra). Therefore, the impugned amendment could not have been allowed to remain in the field of statute. On the other hand, State opposed the contention. 15. Hon'ble the Apex Court in the matter of I.N. Saksena AIR 1976 SC 2250 Para 22 (Supra) has held as below: While, in view of this distinction between legislative and judicial functions, the legislature cannot by a bare declaration, without more, directly overrule, reverse or override a judicial decision, it may, at any time in exercise of the plenary powers conferred on it by Articles 245 and 246 of the Constitution render a judicial decision ineffective by enacting a valid law on a topic within its legislative field fundamentally altering or changing with retrospective, curative or neutralising effect the conditions on which such decision is based. The rendering ineffective of judgments or orders of competent Courts and Tribunals by changing their basis by legislative enactment is a well-known pattern of all validating Acts. Such validating legislation which removes the causes for ineffectiveness or invalidity of actions or proceedings is not an encroachmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect noticed by the Court was cured by statute enforced by State of Madhya Pradesh by amending Section 49 in the year 1994 by amendment Act No. 12 of 1994. 18. When the State of Chhattisgarh came into existence at that moment or thereafter neither proviso of Sub-section (8) of Section 49 of the Act which reads "Provided that if the outgoing Committee of the Society has resolved and requested the Registrar to hold election at least three months in advance and the Registrar has failed to conduct the election on its request, the Registrar shall not assume charge of the Committee and the members of the Committee shall continue to hold the offices", a rule just prior to amendment Act No. 14 of 1990 was in force nor the same law which was, after annulment of relevant amendment by the Court, applicable up to enforcement of Amendment Act No. 12 of 1994 was operative or existed. The Legislature of Chhattisgarh has amended the provisions of Section 49 of the Act in order to keep the democratic value alive, in accordance with their wisdom. Though it may be verbatim to that enshrined in amendment Act No. 14 of 1990 which was annulled by the Court, yet the State Legislature of Chhatti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supra) is concerned, the provisions have been declared as ultra vires mainly on the two contentions. Firstly on the comparison with the earlier provisions in force prior to substitution by Amendment Act No. 14 of 1990, which provides a provision that "if the outgoing committee of the society has resolved and requested the Registrar to hold election at least three months in advance and Registrar has failed to conduct the election at its request, the Registrar shall not assume the charge of the committee and the members of the committee shall continue to hold the office". The above provision does not remain in the statute, vide amendment Act No. 12 of 1994, it has been materially changed and now in case Registrar fails to conduct election and thereafter committee also could not able to complete election within scheduled time; the Registrar has been empowered to assume charge. 23. Here in the instant case, so far as the impugned amendment is concerned, the law that is applicable from 1994 onwards has to be compared, whereas when earlier amendment was brought by the State of Madhya Pradesh vide amendment Act No. 14 of 1990 for comparative value other legislation was there. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... committee and to bring democratic set up in existence. No one, whether State or individual, has right to disfranchise a citizen from his valuable right by whatever means. The Registrar is a public servant and in case he fails to perform his duty to conduct the election as early as possible, there are ways open not only with the Government, but also by judicial forum, to dictate and direct him to conduct the election and hand over charge of elected platform to newly elected body. Neither Courts are helpless nor the Government or the citizen of India. If Registrar grabs the valuable right and power of the society/ committee/or voters, he can be dealt with in accordance with law. 26. Vide Amendment Act No. 3 of ] 982 the provision of Section 49(7-AA) of the Act has been included and by its inclusion, State Government was wrapped with an authority to extend the term of the committee or a society or a class of society. Vide Amendment Act No. 25 of 1988 provision (7-AAA) has been included in Section 49. The term of the committee i.e. five years and the voters to elect the member of the committee had cast their votes for a term of five years, but thereafter their right to franchise has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nshrined in the Act or to say their right to vote will not be robbed by the Government or the outgoing committee. The State Government in order to facilitate political motive is stopped from extending the period of committees at their choice and thereby restrained from misusing its power. The Registrar has a duty to hold election as early as possible, therefore, if he fails, for his misconduct, he can be taken to task by Government or the legal forum. 31. In nutshell, the impugned amendment has the effect of avoiding, management monopoly, unreasonably denying the opportunity to elected members from managing affairs of the society, withholding the right of franchise to member/voter. Further, it debars former elected members to continue next term without being elected afresh for the same. In true sense, in my opinion, the object of the impugned amendment in all honesty is to bring democratic functions of the society alive and which alone is the real object enshrined behind it. 32. In the result, the impugned amendment is neither arbitrary nor violative of Article 14 of the Constitution; therefore, the impugned amendment cannot be annulled or declared ultra vires. Accordingly, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2004 (hereinafter referred to as the Amendment Act). Constitutional validity of this Ordinance as also the amendment Act is under challenge in these writ petitions. All these petitions have been heard together and are being decided by this common order. 37. The State of Chhattisgarh was carved out of the State of Madhya Pradesh under the M.P. Reorganization Act, 2000 on 1-11-2000. 38. It is apt to delineate the relevant provisions of Section 49 of the Act, as it stood, before and after the Amending Act. Section 49 of the Act, as it stood before the Amending Act: (7-A)(i) The term of the committee shall be five years from the date on which first meeting of the committee is held: Provided that where a committee superseded, suspended or removed under the Act is reinstated as a result of any order of any Court or authority, the period during which the committee remained under supersession, suspension out of office as the case may be, shall be excluded in computing the period of the term aforesaid. (ii) The term of the representative elected by the committee of the society shall be co-terminus with the term of the committee of the society for which representative is elected: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as early as possible. Statement of Object and Reasons for the Amendment to Section 49 by The Chhattisgarh Co-operative Societies (Amendment) Act, 2004 Statement of Objects and Reasons: The State Government has decided that the terms of Committee of societies which has been extended from Twelve months to Thirty six months by amendment of Co-operative Society Act. 1960 (No. 17 of 1961) which effected the democratic pattern of Societies (emphasis supplied). To keep in a view to the Public interest to amend in the said Act. (1) Hence, this Bill THE CHHATT1SGARH CO-OPERATIVE SOCIETIES (AMENDMENT) ACT, 2004 No. 22 of 2004: (Received the assent of the Governor on the 10th January, 2005 : assent first published in the Chhattisgarh Rajpatra (Asadharan) dated 14th January, 2005.) An Act further to amend the Chhattisgarh Co-operative Societies Act, 1960. Be it enacted by the Chhattisgarh Legislature in the Fifty-fifth Year of the Republic of India as follows : 1 Short title and commencement. (1) This Act may be called the Co-operative Societies (Amendment) Act, 2004. (2) It shall come into force from the date of its publication in the official Gazette. 2. Amendment of Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1-2000 under the M.P. Reorganisation Act 2000, the Chhattisgarh State Legislature lacked competence to re-enact a law which had been struck down as ultra vires by the High Court of Madhya Pradesh in Anurudh Prasad Shastri State of M.P., 1993 (2) MPJR 33 without curing the defects therein. b) that the impugned amendment takes away the existing right of the management committee to be in the management of the co-operative societies and, is therefore, arbitrary and unconstitutional. c) That the impugned amendment gives unbridled power to the Registrar to be in control of the management of co-operative societies for an unlimited period and is thus subversive of the democratic structure of the co-operative societies and the preamble of the Chhattisgarh Co-operative Societies Act, 1960. d) that the impugned amendment frustrates the object of the Act to develop cooperatives as democratic institutions. 42. Learned Counsel for the petitioners placed heavy reliance on Anurudh Prasad Shastri v. State of M.P. 1993 (2) MPJR 33 contending that a decision rendered by a Division Bench of the parent State of Madhya Pradesh prior to the Reorganisation of the State binds a co-ordinate Bench of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Primary Level Societies were so complex, inter-dependant and complicated that it became difficult to initiate and complete the election process within the statutory period and therefore, the impugned amending provisions have been brought to facilitate the completion of election of all the societies whether Primary, Central or Apex Level Society so that their term is not extended beyond the statutory period and elections were held within time. It was argued that while cutting short the complicated procedure provided in Section 49, the Government had also robbed itself of the power under Sub-section (7-AA) and Sub-section (7-AAA) of the Act. During the course of arguments, it was not disputed that the Ordinance to amend Section 49 was promulgated on a date when the term of the management committees as envisaged under the second proviso to Section 49 (8-i) of the Act had not expired. NATURE OF THE CO-OPERATIVE SET UP IN THE STATE OF CHHATTISGARH 45. Section 2(a-i) of the Chhattisgarh Cooperative Societies Act, 1960 (Act 17 of 1961) defines "Apex Society" to mean a society whose principal object is to provide facilities for the operation of other societies affiliated to i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot;Representative" to mean a member of the society to represent the society in other societies. Section 2(y-i) defines Returning Officer to mean an Officer appointed by the Registrar by general or special order for performing the duties of a Returning Officer under this Act or the rules made thereunder and includes an officer subordinate to the Returning Officer nominated in writing by him to perform the duties of Returning Officer. Section 2(z) defines Society to mean a co-operative society registered or deemed to be registered under this Act. Section 2(z-i)(aa) defines "State Cooperative Bank" to mean the Madhya Pradesh State Cooperative Bank, Limited. 46. Section 4 of the Act obligates the registration of a society and envisages that subject to the provisions of this Act, a society which has as its objects the promotion of the economic interest of its members or their general welfare in accordance with cooperative principles or a society established with the object of facilitating the operations of such a society, may be registered under this Act. The registration has been envisaged under Section 9 and the societies have been classified into 12 categories in Sub- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iety shall vest in the general body of members. The proviso is not relevant, hence omitted. Sub-section (2) of Section 48 says that subject to Sub-section (1), the management of every society shall vest in a committee constituted in accordance with this Act or rules made thereunder or bye-laws of the society and it shall exercise such powers and perform such duties as may be conferred or imposed respectively by the Act or rules made thereunder or bye-laws of the society. Sub-section 3(c) enjoins that in the event of society falling to elect requisite number of members or to elect less than such number of members, as is specified in Clauses (a) and (b), the members of the committee shall co-opt the requisite number of members from amongst members of such society eligible for such representation and in the event of the Committee failing to do so Registrar shall nominate the requisite number of members from amongst members of such society eligible for such representation. Sub-section (5) of Section 48 provides that there shall be a President/Chairman and two Vice-Presidents/Vice Chairman in a resource society The details of representation of the Vice-Chairman are not relevant for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocieties is not complete and therefore elections of the Central Society level can only be held alter the elections for representatives of the Primary Society which are complete. Similar is the position as regards the Apex Society i.e. elections in Apex Society cannot take place until and unless the elections of rep-resentatives at the Central Society level are not complete and the welectoral college so formed is not complete. (Emphasis supplied). 52. If is proper to quote here Paragraphs 16, 17, 18 & 19 from the judgment rendered by the Apex Court in Rajendra Prasad Yadav v. State of M.P. and Anr. . 16. There is no doubt that in our democratic polity, all democratic institutions in-cluding the Co-operative Societies governed by the provisions of the Act are required to be organized on the principles of democratic governance. In fact, Part IX of the Constitution, brought by the Constitution (Sixty-third Amendment) Act, 1992. provides for the panchayat system within the democratic governance by requiring holding of periodical elections right from the bottom-most democratic set-up of the village panchayat up to the District Boards. The elections, therefore, lo the Co-operative Soc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ociety shall, within a period of twelve months from the date of last annual general meeting, call a general meeting of its members for the purposes specified in Clauses (a) to (f) of Sub-section (1) thereof. Section 49(b) says that the purpose of annual general meeting is "election, if fallen due of the members of the committee". Explanation to Section 49(1)(b) envisages that "election of the committee shall be deemed to have fallen due, if the term of the committee comes to an end within a period of three months from the date of the annual general meeting". Sub-section (6) of Section 49 envisages that if the bye-laws of the Society provide for election of all or some members of the committee on territorial basis under Sub-section (7) thereof, such members of the committee shall be elected from the area in a meeting of the members of that area in accordance with the provisions of the bye-laws on a date prior to that general meeting". Sub-section (7-A) provides that "the term of the committee shall be five years from the date on which first meeting of the committee is held". The proviso is not relevant: hence omitted. Clause (iii) of Sub-section (7 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on issued against the Registrar that "he shall not assume charge of the committee and the members of the committee shall continue to hold the office". Under the second proviso, if the Registrar fails to conduct elections of the committee within ninety days from the date of the expiry of the term of the committee, the committee of the society shall appoint returning officer who shall conduct the election of the committee within 180 days from the date of expiry of the term. The combined operation of Sub-section (8)(i) and the second proviso is that though the members of the committee are entitled, by operation of the first proviso, to continue to hold the office, it is equally obligatory on the part of the committee that, if the Registrar fails to conduct elections as envisaged hereinbefore, the returning officer should be appointed whose duty shall be to conduct elections of the committee within 180 days before the date of the expiry of the term. By operation of Sub-section (8)(ii) if the members of the committee having continued to hold office by operation of the first proviso to Sub-section (8)(i), fails to appoint a returning officer under the second proviso and, if the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t observed that co-operative movement was necessary for giving shape to a secular sovereign democratic republic that India is destined to be. According to the Supreme Court, a republic is made of 'men and institutions', and cooperative societies are such institutions. Under the circumstances, there should be no difficulty in holding that the objective of the co-operative movement is to make the democratic process enshrined in the Constitution little more effective. In spite of it, a co-operative society is not meat to be run as a close preserve of an individual or a group of a persons, as would be clear from the decision of Supreme Court in Bhandara Dist. Central Co-op. Bank Ltd. v. State of Maharashtra "Co-operative" has been understood as a form of organization, where persons voluntarily associate together on the basis of equality for the promotion of their economic interests, by democratic means and methodology. The emphasis is on 'co-operation'. It is, therefore, necessary to have active participation of as many members as possible. It should, therefore, be clear that if the impugned amendment has the effect of avoiding management monopoly of any indiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is obligations under the Act and not holding election before the expiry of the term of the existing committee, can be permitted to be benefited by his own default. If the matter is considered in the context of default of the Registrar or the Returning officer appointed by him, and the decision is required to be taken in the context of democratic destiny and the rights of the members to manage the society, the provision would appear, "prima facie, unreasonable and arbitrary. Such a situation was considered by Andhra Pradesh High Court in M. Ranga Reddy v. State of Andhra Pradesh and Ors. , and it was held that if a committee has done all that it was required to do under law to ensure election of a new body before the expiry of the term, it. cannot be held guilty of any dereliction of duty and it cannot be said that such a law abiding body suffers from any handicap in continuing to be in position of management till elections are held (Emphasis supplied by us). The aforesaid conclusion was arrived at in the context of default of the Registrar, who was in-charge of holding elections and failed to perform his duties. Under the circumstances the aforesaid judgment supports the reaso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onable in the context. 55. I shall now proceed to examine the impugned provisions incorporated in Section 49 of the Act. The preamble of Chhattisgarh Co-operative Societies Act reads as under: An act to organize and develop co-operatives as instruments and people's institutions based on self-help, and mutual aid, and for curbing exploitation and ensuring socio-economic development of people with particular emphasis on weaker sections of society. 56. The statement of objects and reasons for incorporating the impugned amendment to Section 49 have been referred to above and shows that the State Government fell that the extension of the term of the committee of societies from 12 months to 36 months by amendment to Sub-section (7-AA) to Section 49 of the Act affected the democratic pattern of societies, and therefore, keeping in mind the public interest the impugned amendment was incorporated whereby Sub-section (7-AA) and Sub-section (7-AAA) were omitted and a new Sub-section (8) was substituted in place of Sub-section (8)(i) and (ii) which have also been referred above. As stated earlier, under subsection (8)(i), as it stood prior to the amendment, it was obligatory on the out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was crystal clear that before the expiry of the period stipulated in Sub-section (7-A(i)) or the extended period mentioned in subsection (7-AA) if the committee resolved and applied to the Registrar for holding elections within a reasonable time i.e. at least 90 days before expiry of its term, the legislative injunction imposed against the Registrar to assume charge of the committee would become operative till 90 days after the expiry of the term of the committee but not later than that since thereafter the committee of the society was under an obligation to appoint Returning Officer for conducting elections of the committee within a period of 180 days from the date of expiry of the term. The effect of the deletion of Sub-section (7-AA) and Sub-section (7-AAA) and substitution of Sub-section (8)(i) of the amended Sub-section (8) is that immediately after expiry of the term of the committee, the Registrar would automatically take over the management of the committee and thereafter no period is prescribed for holding elections meaning thereby that the Registrar could allow the election process to be thwarted and remain in office for an indefinite period. In this manner, a premium wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of the provision is more for creating mischief and subverting the democratic process than for ensuring healthy democratic culture by holding elections. Such a provision is, per se, arbitrary and violative of Article 14 of the Constitution of India and it is accordingly held so. 58. It is also well settled by a catena of decisions of the Apex Court that the existing rights created by a statute in favour of a group of persons or a society could not be taken away by an amendment. That being so, under the existing law i.e. under Section 49(8) of the Act, as it stood prior to the impugned amendment, upon failure of the Registrar to hold elections within 90 days from the date of expiry of the term of the Committee, the Committee of the Society had an existing right to continue with the management of the committee and was under an obligation to appoint a Returning Officer for conducting the elections of the Committee within 180 days from the date of the expiry of the term. In this view of the matter, under the provisions of the Chhattisgarh Cooperative Societies Act, 1960, the Managing Committee had an existing right to get the elections conducted within a period of 180 days under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Paras 36 & 56 of AIR: The validity of the Validating Act is to be judged by the following tesis: (i) whether the legislature enacting the Validating Act has competence over the subjective-matter; (ii) whether by validation, the legislature has removed the defect which the Court had found in the previous law; (iii) whether the validating law is consistent with the provisions of Chapter III of the Constitution. If these tests are satisfied, the Act can validate the past transactions which were declared by the Court to be unconstitutional. The legislature cannot assume power of adjudicating a case by virtue of its enactment of the law without leaving it to the judiciary to decide it with reference to the law in force. The legislature also is incompetent to overrule the decision of a Court without properly removing the base on which the judgment is founded. The adjudication of the rights of the parties is the essential judicial function. Legislature has to lay down the norms of conduct or rules which will govern the parties and the transactions and require the Court to give effect to them. The Constitution delineated delicate balance in the exercise of the sovereign power by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in taxing statutes. Courts, except under extraordinary circumstances, would be reluctant to override the legislative judgment as to the need for and wisdom of the retrospective legislation. 64. Testing the impugned amendment on the touchstone of principles enunciated by the Apex Court in I.N. Saksena AIR 1976 SC 2250 (supra) it is manifest that the impugned amendment cannot, by any stretch of imagination, be said to be a validating legislation inasmuch as it does not remove any defect which the Court had found in the previous law in Anurudh Prasad Shastri (supra) and reproduces verbatim the same amendment. The amendment is nothing but an exercise to overrule the decision of the High Court in Anurudh Prasad Shastry (supra) without property removing the base on which the judgment is founded. Placing reliance on Indian Aluminum Company and Ors.. AIR 1996 SC 1431 (supra) and Ujagar Prints and Ors. AIR 1989 SC 516 (supra), f am of the considered opinion that impugned amendment cannot be said to be a validating curative exercise made by the Legislature of State of Chhattisgarh. Before the reorganization of the State of Madhya Pradesh and on formation of the State of Chhattisgarh on 1-1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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