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PETITIONER:

JT. REGISTRAR OF COOPERATIVE SOCIETIES, KERALA

Vs.

RESPONDENT:

T.A.KUTTAPPAN & ORS.

DATE OF JUDGMENT: 09/05/2000

BENCH:

Y.K.Sabharwal, S.R.Babu

JUDGMENT:

RAJENDRA BABU, J. :

These appeals by special leave are against a common

order made in O.P.Nos.12184, 14840, 14686, 15700, 17258,

18398 and 20913/97. Section 32 of the Kerala Cooperative

Societies Act, 1969 [hereinafter referred to as `the Act']

enables the Registrar of Cooperative Societies to supersede

the Committee of Management under the circumstances set

forth in sub-Section (1) thereto. After supersession of the

Committee of Management, the Registrar can appoint an

administrator or administrators or a Committee as provided

in Section 32(1)(a) and (b) of the Act. Such Committee or

administrator or administrators so appointed shall, subject

to the control of the Registrar and to such instructions as

he may from time to time give, have power to exercise all or

any of the functions of the Committee or of any officer of

the society and take all such action as may be required in

the interests of the society. When the administrator

appointed on supersession of the Committee of Management of

certain Cooperative Societies wanted to enrol new members to

the society the same was objected to and the original

petitions under Article 226 of the Constitution were filed

before the High Court on the ground that the Registrar is

only expected to carry on day-to-day functions of the

society and see that election is conducted and a new

Committee in accordance with the Act, Rules and bye-laws of

the society is constituted. It was contended before the

court that the earlier decision in George vs. Joint

Registrar, 1985 KLT 836, is no longer good law in the light

of the decision of this Court in K. Shantharaj & Anr. vs.

M.L.Nagaraj & Ors., 1997 (6) SCC 37. The Full Bench of the

High Court, after referring to the earlier decision of the

High Court and the decision of this Court in K.

Shantharaj's [supra] held that the admission of a member is

not mere `function' of the Committee, but is a `power' of

the Committee to admit members or not as provided in Bye

Laws of the Society. The Committee can exercise only

certain functions and not any powers and, therefore, the

administrator or a Committee appointed as aforesaid has no

power to enrol new members. This order is in challenge in

these appeals.

It is now brought to our notice that subsequent to the

decision of the High Court, the provisions of Section 32

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have been amended so that the administrator or the Committee

will have power to exercise all or any of the powers and

functions of the Committee. It is further brought to our

notice that in Cherthala Agricultural Rural Development Bank

& Ors. vs. Joint Registrar & Ors., 2000 (1) KLJ 291 (FB)

it has been held that the decision in the case before us

holding that the administrator has no power to enrol new

members would have prospective and not retrospective effect.

The scope of neither amended Section 32 of the Act nor the

decision in Cherthala Agricultural Rural Development Bank &

Ors. vs. Joint Registrar & Ors. (supra) is required to be

considered by us in these proceedings.

The question whether an administrator appointed during

supersession of a Committee of Management of a Cooperative

Society can enrol new members is no longer res integra.

When an identical question came up before this Court for

consideration in K. Shantharaj's case [supra], this Court

held that from the language of Sections 30 (which is similar

to Section 32(4) of the Act) and 30A of the Karnataka

Cooperative Societies Act, 1959, it would be clear that the

administrator, subject to control of Registrar exercise all

or any of the functions of the society, and the Special

Officer subject to control of the State Government and the

Registrar exercise and perform all the powers and functions

of the committee of the society and in the interest of the

society can take such action as is necessary for proper

functioning of the society as per law. He should conduct

elections as is enjoined thereunder, that is, he is to

conduct election with the members as on the rolls and by

necessary implication, he is not vested with power to enrol

new members of the society. In the light of this clear

enunciation of law the view taken by the High Court appears

to be correct.

However, the learned Addl.Solicitor General appearing

for the appellants, submitted that there is difference in

language between the provisions of the Karnataka Cooperative

Societies Act and the Act which was, in fact, noticed by the

Karnataka High Court and, therefore, submitted that the

decision in K. Shantharaj's case [supra] is not applicable

to the facts of this case. For the purpose of appreciation

of this submission, it is necessary to set out the relevant

provisions of the Karnataka Act and the Kerala Act :

Section 30(2) of the Karnataka Act Section 32(4) of

the Act

"The administrator so appointed shall subject to the

control of the Registrar and such instructions as he may

give from time to time, exercise all or any of the functions

of the Committee or of any officer of the Cooperative

Society and take such action as he may consider necessary in

the interest of the society."

Section 30-A of the Karnataka Act

"Appointment of Special Officer. - (1) Where the

State Government, on a report made to it by the Registrar or

otherwise, is satisfied that any Cooperative Society is not

functioning in accordance with the provisions of this Act or

the rules made thereunder or its bye-laws or any order,

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direction or circular issued by the State Government or the

Registrar, it may notwithstanding anything in this Act, by

order, appoint a Special Officer for such Cooperative

Society for such period not exceeding two years :

Provided that the State Government may, if it

considers it necessary extend the said period of two years

by such further period not exceeding one year. (2) * * *

(3) The Special Officer shall, subject to the control of the

State Government and the Registrar, exercise and perform all

the powers and functions of the Committee of the Cooperative

Society or any officer of the Cooperative Society and take

all such actions as may be required in the interest of the

Cooperative Society."

"The Committee or administrator or administrators so

appointed shall, subject to the control of the Registrar and

to such instructions as he may be from time to time give,

have power to exercise all or any of the functions of the

Committee or of any officer the society and take such action

as may be required in the interests of the society."

The learned Addl.Solicitor General relied on that

portion of the judgment of the Division Bench which affirmed

the view of the learned Single Judge where a comparison

between the Act and the Karnataka Act was considered and we

may set out what was stated by the Division Bench :

"Accordingly, he is not entitled to enrol new members.

But it has to be noted that the wording of Section 32(4) of

the Kerala Cooperative Societies Act is slightly different

from the wording of Section 30 of the Act. In the Kerala

Act, the Administrator has power to exercise all or any of

the functions of the committee, whereas in the Karnataka

Act, the Administrator can only exercise all or any of the

functions of the committee. Moreover, as stated earlier,

the difference in the authority vested in an Administrator

and a Special Officer, as is made in the Karnataka Act is

not considered in the Kerala decision. The difference in

the authority vested in an Administrator and a Special

Officer in the Karnataka Act, is very significant which is

absent in the Kerala Act. In that view of the matter, the

dictum laid down by the Division Bench of the Kerala High

Court, cannot have any application while determining the

comparative authority of an Administrator and a Special

Officer appointed under Sections 30 and 30-A of the

Karnataka Act respectively."

This very aspect was also brought to the notice of the

Full Bench of the Kerala High Court.

If we carefully analyse the provisions of the Act, it

would be clear that the administrator or a Committee

appointed while the Committee of Management of the Society

is under supersession cannot have the power to enrol new

members and such a question ought not to be decided merely

by indulging in an exercise on semantics in ascertaining the

meaning of the expression have "power to exercise all or any

of the function.". Whether an authority is discharging a

function or exercising a power will have to be ascertained

with reference to the nature of the function or the power

discharged or exercised in the background of the enactment.

Often we do express that functions are discharged or powers

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exercised or vice versa depending upon the context of the

duty or power enjoined under the law if the two expressions

are inter-changeable. What is necessary to bear in mind is

that nature of function or power exercised and not the

manner in which it is done. Indeed this Court, while

considering the provisions of Section 30-A of the Karnataka

Act, which enabled a Special Officer appointed to exercise

and perform all the powers and functions of the Committee of

Management or any officer of the Cooperative Society (and

not merely functions), took the view that the administrator

or a special officer can exercise powers and functions only

as may be required in the interests of the Cooperative

Society. In that context, it was stated that he should

conduct elections as enjoined under law, that is, he is to

conduct elections with the members as on the rolls and by

necessary implication, he is not vested with power to enrol

new members of the society. We may add that a Cooperative

Society is expected to function in a democratic manner

through an elected Committee of Management and that

Committee of Management is empowered to enrol new members.

Enrolment of new members would involve alteration of the

composition of the society itself and such a power should be

exercised by an elected Committee rather than by an

administrator or a Committee appointed by the Registrar

while the Committee of Management is under supersession.

This Court has taken the view, it did, bearing in mind these

aspects, though not spelt out in the course of the judgment.

Even where the language of Section 30-A of the Karnataka Act

empowered a special officer to exercise and perform all the

powers and functions of Committee of Management of a

Cooperative Society fell for consideration, this Court

having expressed that view, we do not think, there is any

need to explore the difference in the meaning of the

expressions "have power to exercise all or any of the

functions of the Committee" in the Act and "exercise all or

any of the functions of the Committee" in the Karnataka Act

as they are not different and are in substance one and the

same and difference in language will assume no importance.

What is of significance is that when the Committee of

Management of the Cooperative Society commits any default or

is negligent in the performance of the duties imposed under

the Acts, rules and the bye-laws, which is prejudicial to

the interest of the society, the same is superseded and an

administrator or a Committee is imposed thereon. The duty

of such a Committee or an administrator is to set right the

default, if any, and to enable the society to carry on its

functions as enjoined by law. Thus, the role of an

administrator or a Committee appointed by the Registrar

while the Committee of Management is under supersession, is,

as pointed out by this Court, only to bring on an even keel

a ship which was in doldrums. If that is the objective and

is borne in mind, the interpretation of these provisions

will not be difficult.

Thus, we are of the view that this Court in K.

Shantharaj's case [supra] took the view that an

administrator or a special officer in the Karnataka Act is

not vested with the power to enrol new members of the

Cooperative Society in this context. While reiterating that

view in regard to the Kerala Act, we afford further reasons

to support the said view and dismiss these appeals, though

for reasons different from those expressed by the High

Court. However, in the circumstances of the case, there

shall be no orders as to costs.

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