ANAND PRAKASH Vs. ASSISTANT REGISTRAR CO OPERATIVE SOCIETIES

JUDGEMENT

(1.) The substantial question of law raised in this petition under Article 226 is whether an arbitrator seized of a reference under the Co-operative Societies Act can grant an order of stay or an injunction during the pendency of the arbitration proceedings.

(2.) The Board of Directors of the Muzaffarnagar Wholesale and Retail Consumers Cooperative Stores Ltd. (a society which is registered under the Co-operative Societies Act, 1912) resolved to hold the annual general meetings of the Stores on 16/9/1966. At the commencement of the annual general meeting Sri Vidva Sagar Goel, a delegate, raised an objection that the meeting could not lawfully be held as Sri Kesho Gupta, M. L. A., who was a Government nominee, had not been duly informed. Thereupon Dr. Rakeshwar Dass Jain, respondent No. 4 who was presiding at the meeting declared that the meeting was unlawful and adjourned it It is alleged that the delegates present did not agree with this ruling. They elected Sri Anand Prakash, the petitioner, to preside at the annual general meeting and continued the proceedings of the annual general meeting The meeting transacted the business on the agenda and elected 12 members to the Board of Directors. Sri Anand Prakash, petitioner No. 1, was elected as the Chairman. It is stated that the newly elected Board of Directors assumed charge of their offices on 16/9/1966 and commenced functioning from that date.

(3.) On 17/9/1966 Dr. Rakeshwas Dass Jain filed an arbitration petition before the Assistant Registrar Co-operative Societies, Muzaffarnagar. He alleged that the proceedings conducted at the annual general meeting after it had been declared adjourned were illegal and ultra vires. It prayed that all those proceedings be declared void and the elections held be also declared illegal and void and the Secretary be ordered not to interfere in the working of the petitioner as the President of the Board of Directors and the newly elected Board of Directors be directed to refrain from working Along with the arbitration petition Sri Jain filed another application praying that the Secretary be ordered not to hold the meeting of the Board of Directors and the newly elected President and the Secretary be directed not to interfere in the working of the petitioner as President Sri Jain filed an affidavit in support of this application On September 19th 1966 the arbitrator respondent No 2, passed an ex parte order holding that he was satisfied that there was a prima facie case to grant stay and that it was just to pass a proper stay order He consequently directed the persons elected as Directors and President at the annual general meeting, not to function as Directors and President He also directed that the Directors and the President as existing till 16/9/1966 shall continue to function till the disposal of the arbitration case. Copy of this order was forwarded, inter alia, to the Secretary as well as the 12 newly elected Directors and the President.