ADITYA VARMA RAJA S/O KAVU THAMPURAN Vs. KERALA STATE CO-OPERATIVE ELECTION COMMISSION CO-BANK TOWERS

JUDGEMENT

(1.) The issue that arose for consideration in W.P(C)No.15917/2015 on the file of this Court was as to whether the resolution dated 9.5.2015 of the Joint Registrar deserves to be approved or set aside. The resolution pertained to the bifurcation of the Irinjalakuda Co-operative Agricultural and Rural Development Bank Ltd. consequent on the formation of Chalakudy Taluk. The issue was set at rest by Ext.R3(a) judgment dated 15.1.2016 in W.A. No.2715/2015 wherein the Division Bench concluded as follows:

(2.) Section 14(4) of the Kerala Co-operative Societies Act, 1969 ('the Act' for short) enjoins the bank to give notice of the passing of the resolution in writing to all its members and creditors. This is to facilitate any member or creditor to exercise the option of withdrawing his shares, deposits or loans within a period of two months from the date of service of notice upon him. Section 14(5) of the Act clarifies that any member or creditor who does not exercise his option within the period of two months shall be deemed to have given his assent to the proposals in the notification. Section 14(6) of the Act is categoric that a resolution as aforesaid shall not take effect until either the assent thereto has been given or deemed to be given or the claims met in full. The manner of service of notice has also been prescribed under Section 104 of the Act which is by registered post by addressing it to the last known address of the persons. Evidently the procedure contemplated under Sections 14(4) and 14(5) of the Act were not complied with before the new bank was registered by Ext.P3 proceedings dated 26.12015 of the Joint Registrar. Ext.R3(c) paper publication dated 20.5.2015 was much before the approval of the resolution by the Joint Registrar on 26.12015 and cannot be treated as a valid notice under Section 14(4) of the Act. We are prompted to quash Ext.R3(b) registration certificate dated 28.12015 by which the Chalakudy Primary Co-operative Agricultural and Rural Development Bank Ltd. has come into existence. But then it is pointed out that the new bank after bifurcation has been functioning for the past about 2? years and has granted loan and facilities to many customers. The appellant fairly submits that he does not want to derail the banking business and that he is confining his relief to the procedure to be adopted statutorily after registration.

(3.) The next step to be taken is the appointment of an interim committee in terms of Rule 41 of the Kerala Co-operative Societies Rules, 1969 ('the Rules' for short) to conduct the affairs of the new bank formed. Such of the members of the original bank who will become members of the new bank on bifurcation shall appoint a committee consisting of not more than five persons in a General Body meeting convened. The interim committee shall exercise all the powers conferred and discharge all the duties imposed on the managing committee under the bye-laws. It is the interim committee who shall arrange for the constitution of a committee in accordance with the provisions of the Act, Rules and byelaws of the new bank before the expiry of its term. The above is the procedure to be adopted as contemplated under Rules 41(4) and 41(5) of the Rules which was in contemplation by Ext.R3(a) judgment.