B. V. MALLA REDDY Vs. STATE OF KARNATAKA

JUDGEMENT

(1.) These appeals arise out of a common order passed by the learned Single Judge in W.P.No.29029/2012 and connected matters, which were disposed of on 12.01.2015.

(2.) The appellants are founder members/ promoters of the 2nd respondent Co-operative Bank, which was established in the year 1998. The Bank was initially registered under the provisions of Karnataka Co-operative Societies Act, 1959 and subsequently registered under the Karnataka Souharda Sahakari Act, 1997 (hereinafter referred as the 'Souharda Act'). The appellants were taken to the Board of the Bank, unanimously as special invitees. Subsequently, on being elected, the appellants were holding the post of Directors. The 1st appellant was also elected thrice, continuously as the President of the Bank. After resigning to the post of Director and President, respectively, the appellants continued as ordinary members of the Bank. On 30.12.2010, the Board of the Bank, by passing a resolution, removed the appellants from the membership of the Bank. Being aggrieved, the appellants raised a dispute before the Joint Registrar of Co-operative Societies (hereinafter referred to as 'JRCS' for short) under Section 39 of the Souharda Act.

(3.) On consideration of the preliminary objections raised by the Bank that a dispute under Section 39 was not maintainable against an order of cancellation of membership, the JRCS, upheld the objections and dismissed the dispute, on 10.03.2011. The appellants preferred W.P.Nos.9627 and 9628/2011, challenging the validity of section 21 of the Souharda Act. Section 21 provides for an appeal before the General Body of the Co-operative Society/Bank, on an order of cancellation of membership. Simultaneously, appeals were preferred before the Karnataka Appellate Tribunal, calling in question the order passed by the JRCS.