KRISHAK BHARTI Vs. UOI

JUDGEMENT

(1.) IN this Writ Petition it has, inter alia, been prayed that a writ of certiorari be issued quashing the Order dated 6. 12. 2006 of the government of India (GOI) directing the repatriation to the GOI of equity held by it in the Petitioner Society, namely, Krishak Bharti Co-operative limited (KRIBHCO ). It is necessary to reproduce the said Order, inter alia, to demonstrate that it fails altogether to address or adumbrate the nature of the public interest which it endeavours to protect or project:-WHEREAS the Krishak Bharti Cooperative Ltd. (KRIBHCO), a Multi-state cooperative Society registered under the Multi-State Cooperative Societies Act, 2002 (39 of 2002) and is a fertilizer production unit in the Cooperative sector and as per item 5 of Schedule II to Rule 3 of the Government of india (Allocation of Business) Rules is under the administrative responsibility of the Department of Fertilizers; and WHEREAS the Government of India is a member and a majority shareholder in the said KRIBHCO; and WHEREAS the said KRIBHCO, pursuant to the amendment to its Bye-Law No. 8, unilaterally and without either the approval or concurrence of the Government of India, has been repatriating the government of India equity held in the said Society, an Act which has been expressly being objected to by the Department of Fertilizers; and WHEREAS the matter regarding the amendment of Bye-Laws by the kribhco and the unilateral repatriation of GOI equity is under examination by the competent authority in the Government of India; and WHEREAS inspite of the refusal of the Department to accept the unilateral repatriation of GOI equity and consequent return of the cheques received in this regard to the KRIBHCO, the said Society has been persisting with the attempts for repatriation of GOI equity and the central Government is satisfied that in public interest and in order to secure proper management of the business of the said KRIBHCO, it is necessary to issue a direction to the said Society; now, THEREFORE, in exercise of the powers vested under section 122 of the Multi-State Cooperative Societies Act, the Central Government, hereby directs that the KRIBHCO shall cease forthwith its attempts to repatriate GOI equity held in the said Society and desist from bringing any resolution/agenda item in the Board/general Body proposing to enable the Society or its Management for repatriation of GOI equity without the specific written and prior approval of the department of Fertilizers; any violation of the above directive shall render the KRIBHCO liable to the action as specified under section 123 of the MSCS Act.

(2.) THE Petitioner asserts that upon the enactment of the Multi-State Co-operative Societies Act, 2002 (for short "mscs Act"), the petitioner had proposed to amend its existing Bye-laws Numbers 8 and 29 (ii) allegedly to make it fall in line with the provisions of the said statute. It appears that on 7. 9. 2002 the Board of kribhco had approved these amendments. The earlier, as well as the current provisions, are reproduced in juxtaposition:-

(3.) BY Notice dated 13. 9. 2002, under Bye-law 32, the Agenda of the 22nd Annual General Body Meeting (AGM) was circulated to the members/delegates of KRIBHCO of which Item (VII) was "consideration of amendment to the Bye-laws of the Society". The Notes in respect of this agenda Item are as follows: further, as per the laid down principles of law, the Bye-laws are subservient to the Act and therefore, wherever the provisions of the bye-laws are in conflict or repugnant to the provisions of the act, the same shall not be applicable and the Act shall prevail. According to Section 126 of the MSCS Act, 2002, KRIBHCO would be deemed to be registered under the new Act and Bye-laws of KRIBHCO shall, in so far as they are not inconsistent with the provisions of the new Act, or the Rules, continue to be in force until altered and rescinded. Therefore, the Bye-laws of KRIBHCO to the extent they are inconsistent with the new Act would be inoperative and void and in their place the provisions of MSCS Act, 2002 would be legally in force. In view of the above, certain clauses of the existing Bye-laws which are not in consonance with MSCS Act, 2002 require amendment. It is, therefore, proposed to make suitable changes in some of these clauses of the existing Bye-laws which require immediate attention, to bring them in conformity with the provision of the MSCS Act, 2002.