NATHA SINGH Vs. STATE OF HIMACHAL PRADESH

JUDGEMENT

(1.) The above writ petition has been filed seeking for the issue of a writ to quash the proceedings dated 14.7.1998 (a requisition for holding special meeting of the Board of Directors of the Bank) filed as Annexure PC and dated 18.7.1998 (the notice convening the meeting of the Board of Directors of the H.P. State Co-operative Agricultural and Rural Development Bank Ltd.) issued by the Managing Director of the Bank and filed as Annexure PE and consequently permit the Petitioner to work as the President of the 3rd Respondent-Bank for a complete tenure of four years and also for restraining Respondents 1 and 2 herein from interfering in the day-to-day functioning of the 3rd Respondent-Bank.

(2.) The relevant factual details for appreciating the grievance of the Petitioner are that the election process for the post of Director, Mandi District of H.P. State Co-operative Agricultural & Rural Development Bank Ltd. Shimla, hereinafter referred to as 'the 3rd Respondent -Bank' was conducted pursuant to the orders of the Registrar of Co-operative Societies dated 26.11.1997, in accordance with the prescribed procedure and the Petitioner was declared elected as the Director and a notification for the purpose was also issued on 15.1.1998. Thereupon the meeting of the Board of Directors of the 3rd Respondent -Bank was held on 23.3.1998 and the Director of the said Bank (both elected and nominated) participated in the same and the Petitioner was unanimously elected as the President of the 3rd Respondent-Bank for a term of 4 years in terms of Bye-law No. 37(a) of the Bank. The Petitioner claims that he was elected earlier as a member of the Legislative Assembly of Himachal Pradesh in 1984, that he was also a minister and elected Chairman of the 3rd Respondent-Bank twice before. It is stated that the Petitioner is the General Secretary of Indian National Congress and also a member of the All-India Congress Committee and during his earlier tenure the 3rd Respondent -Bank had been given special Trophy for making 100% growth of the Bank and the Bank was given a Trophy for making maximum recoveries. The further stand of the Petitioner is that by invoking the powers of nomination of the Directors of the Bank Respondents No. 1 and 2 replaced some of the existing Directors by nominating four now Directors and thereafter contrary to the expectations of an assured term of four years, with the change in the ruling party of the State Government, the Respondents started interfering with the day-to-day administration of the 3rd Respondent-Bank, vindictively and with a mala fide and ulterior motives to achieve political ends they have initiated the impugned proceedings to dislodge the Petitioner by adopting unlawful means in order to bring into and instal their own person in the helm of affairs in gross violation of the provisions of the Act, rules and the Bye-laws

(3.) The Petitioner had also made reference in the petition to the relevant provisions of the Himachal Pradesh Co-operative Societies Act, 1968, some of the relevant rules and bye-laws to substantiate his claim that the Management of the affairs of the Bank vests with the general Body of Members of the Bank, that the Board of Directors of the Management Committee carries on the day-to-day functions and that there is no power conferred upon the Board of Directors or upon any one else for that matter to remove or dislodge a Chairman in office, duly elected, by passing any resolution expressing lack or want of confidence in him by the Directors of the Board and that therefore the entire proceedings are illegal, invalid and void and brought about on account of political bias and malice utilising the statutory functionaries for such nefarious purposes in gross abuse and misuse of power for selfish and political ends and objects. The stand taken for the Petitioner in the writ petition is also that the 3rd Respondent-Bank being 'State' within the meaning of Article 12 of the Constitution of India, having regard to its pervasive control over the functioning of the Bank, the funding of the Bank by the Government and the public functions discharged by it in furtherance of the Directive Principles of State Policy and therefore, a writ could be maintained in this Court. The Petitioner also challenges the competency of the Managing Director to convene the meeting in question by issuing a notice dated 18.7.98 and that Rule 43 relied upon for the purpose is inappropriate and irrelevant and that the Petitioner had also strongly objected to the procedure adopted by the Managing Director in his representation dated 22.7.1998 and there is absolutely no scope for removing the Petitioner by the present mode adopted and the entire proceedings are without jurisdiction, opposed to the statute, rules and bye-laws governing the Bank in question. When the writ petition came up before Court for orders regarding admission, notice was ordered and having regard to the fact that the meeting convened was to be held on that very day when the writ petition was brought before the Court we allowed the meeting to go on but directed that the resolution, if any, passed therein, shall be kept in abeyance and will not be implemented till further orders are passed in the petition, with a further direction to post the petitions, main and miscellaneous, for final hearing with the consent of the parties on either side on 3.8.1998, with liberties to them to file their replies and rejoinders, if they choose to do so, in the meantime: