LASHKAR SINGH Vs. STATE PUNJAB AND OTHERS

JUDGEMENT

(1.) On 5th of August, 1983, thirteen Directors were elected to the Jullundur Central Co-op. Bank Ltd. and three Directors were nominated by the government to the said bank. The Manager of the said bank summoned them to a meeting fixed for 25.8.1982. The agenda for the said meeting inter alia, included the election of the office-bearers namely, President, Vice- President and the Managing Director besides the members of the executive committee. On the day of the meeting all the sixteen Directors were present in the meeting. In that meeting petitioner No. 3 was elected President, Shri Vishwa Mitter as Vice-President and petitioner No. 5 Managing Director besides electing requisite members of the executive committee. In the meeting an objection was raised to the validity of the said meeting at the very outset on the ground that the said meeting could have been summoned only by the Chief Executive Officer of the bank and not by the Manager. This objection was over-ruled by a majority vote. Nine of the sixteen Directors voted against the objection. Out of the three nominated members, two sided with the objectors and one with those who opposed the objection. Deputy Registrar Co-operative Societies Jullundur brought to the notice of the Government the objection which was raised to the validity of the meeting in terms of section 26(4) of the Punjab Co-opertive Societies Act, 1961 (hereinafter referred to as the Act). On 24.4.1983 the Government passed the order whereby it agreed to the dissenting note of the nominated Directors to the validity of the said meeting.

(2.) This order has been impugned in the present writ petition by the petitioners on the ground that the meeting of the Directors was validly summoned by the Manager; firstly because the post of the Chief Executive Officer was vacant and under Bye-laws of the Jullundur Central Co-op. Bank Ltd. (hereinafter referred to as the Bye-Laws) Manager alone had the authority to perform the functions of the Chief Executive Officer; that nominated Directors had no right to participate in the meeting of the Board of Directors when electing its office-bearers and therefore, they had no right to strike a note of dissent; that, in any case, election could not be set aside by the Government under section 26(4) to intervene. It could do so only when subject matter of the resolution of the meeting pertained either to the transaction of the financial business of the bank or a matter of policy having financial implication for the bank and not in other matter.

(3.) On behalf of the respondent-State the stand taken is that only the Chief Executive Officer could have summoned the Directors into a meeting and not the Manager of the bank; and that the post of the Chief Executive Officer was not vacant as Shri Puran Singh, Assistant Registrar, Co-operative Societies, Jullundur, had been directed by the Registrar, Cooperative Societies to discharge the functions of the Chief Executive Officer of the bank in addition to his own duties as Assistant Registrar.