High Court
Legal Reasoning
1 901-WP.1244-24, oral jud.odtIN THE HIGH COURT OF JUDICATURE AT BOMBAYBENCH AT AURANGABADWRIT PETITION NO.1244 OF 2024Devidas S/o Janardhan Niware,Age: 72 years, Occu: Agril.,R/o. Nathnagar Paithan, Tq. Paithan,Dist. Chhatrapati Sambhajinagar.… petitioner VERSUS1. The State of Maharashtra,Through its Secretary,Co-operation Department,Mantralaya, Mumbai-32.2. The Divisional Joint Director (Sugar),Kranti Chowk, Chh. Sambhajinagar.3. The State Co-operative Election Authority,Maharashtra State, Pune,Central Administrative Building,Shivajinagar, Pune.4. The District Co-operative Election Officerand The Regional Joint Director of Sugar,Chhatrapati Sambhajinagar,Near Kranti Chowk, Chh. Sambhajinagar.5. The Retuning Officer,Shri Sant Eknath Sahakari Sakhar Karkhana Ltd.,Eknath Nagar, Paithan, Tq. Paithan,Dist. Chhatrapati Sambhajinagar.6. Shri Sant Eknath Sahakari Sakhar Karkhana Ltd.,Eknath Nagar, Paithan, Tq. Paithan,Dist. Chhatrapati Sambhajinagar,Through its Administrator/ Managing Director.7. Sachin s/o Vikramrao Ghayal,Age: 37 years, Occu: Business,R/o. Pannalal Nagar, Paithan, Tq. Paithan, Dist. Chh. Sambhajinagar.
Legal Reasoning
2 901-WP.1244-24, oral jud.odt8. Aabasaheb s/o Sheshrao More,Age: 55 years, Occu: Agril.,R/o. Katpur, Tq. Paithan,Dist. Chh. Sambhajinagar.9. Eknath s/o Baban Nawale,Age: 45 years, Occu: Agril.,R/o. Wahegaon, Tq. Paithan,Dist. Chh. Sambhajinagar.10. Bhaskar s/o Sheshrao More – Deleted.11.Arefkhan Yusufkhan Pathan – Deleted.12. Haribhau s/o Bapurao Mapari – Deleted.13. Vishnu s/o Asaram Bodakhe,Age: 56 years, Occu: Agril.,R/o. Jaisingnagar, MIDC, Paithan,Tq. Paithan, Dist. Chh. Sambhajinagar.14. Bhagyashree w/o Ravindra Ghayal – Deleted.15. Santosh s/o Laxman Kharad – Deleted.16. Tarabai w/o Rameshwar Ghayal,Age: 45 years, Occu: Agril.,R/o. Harshi (Kh.), Tq. Paithan,Dist. Chh. Sambhajinagar.17. Mahesh s/o Baburao Bombale,Age: 34 years, Occu: Agril.,R/o. Pachegaon, Tq. Paithan,Dist. Chhatrapati Sambhajinagar.18.Vishal s/o Raosaheb Waghchaure,Age: 29 years, Occu: Agril.,R/o. Dhoopkheda, Tq. Paithan,Dist. Chhatrapati Sambhajinagar.… Respondents....Advocate for the Petitioner : Mr. Ghatol-Patil S. B. withMr. Rahul C. Babar, Mr. D. S. Daspute, D. B. Dansode.AGP for Respondents-State : Mrs. R. R. Tandale.Advocate for Respondent Nos.3 to 5 : Mr. S. K. Kadam. 3 901-WP.1244-24, oral jud.odtAdvocate for Respondent No.6 : Mr. D. J. Choudhari.Advocate for respondent No.7 : Mr. N. B. Khandare h/f Mr. B.B. Bhise....CORAM : S. G. MEHARE, J.DATE :07.02.2024ORAL JUDGMENT :- 1.Rule. Rule made returnable forthwith and heard finallyby consent of the parties.2.The Petitioner is one of the candidates who submittedthe nomination for the election from the Constituency ofSugarcane Producers Members of Kavsan Gut (1). RespondentNo.7 was also the candidate. His nomination has been allowed,and against the acceptance of his nomination, the petitionerapproached this Court.3.The objection of the petitioner in brief is that respondentNo.7 was and is the Director of Sachin Ghayal Sugar Pvt. Ltd.He holds 90% of the share capital of the said company. He is adefaulter of the society. His company runs the society/respondent No.6 by way of contract. Therefore, he is notqualified to contest the election. He is running a similar type ofbusiness. Therefore, he is disqualified under Section 73CA(A1)Sub Clause (1)(f) Sub Clause (v) of the Maharashtra Co-
Decision
4 901-WP.1244-24, oral jud.odtoperative Societies Act, 1960 (In short ‘MCS Act’). He hasreferred to the various documents obtained from the Ministryof Corporate Affairs website and submits that he is the personhaving an interest in the said company. He could not contestthe election of the society. He fairly conceded that thepetitioner was not an objector before the Returning Officer.One Mahesh Baburao Bombale (Respondent No.17) was theobjector. However, he has been won over. Hence, he did notimpugn the order of acceptance of nomination of respondentNo.7. He submits that the petitioner, being one of the aspirantsof the election and a member of the society, has every right toimpugn the acceptance of the nomination of respondent No.7.Therefore, he has a locus to file the writ petition. Referring tothe above provisions, he prayed to allow the writ petition. 4.To bolster his argument, he relied on the case of JanabaiGondu Mahajan Vs. District Co-operative Election Authorityand Divisional Joint Registrar; 2023(3) Mh.L.J. 386. In the saidcase, respondent No.3, who was not directly connected withthe affairs of the society, had intervened in the process ofsubmission of election expenditure. The Court held that he wasnot a voter or representative of the said society. However, hecan bring it to the notice of the Authority that an elected 5 901-WP.1244-24, oral jud.odtcandidate does not submit election expenditure. However, hecannot intervene in the process and become a party to theprocess of submitting and scrutinizing election expenditures. Inthat case, the present petitioner admittedly was a nomineefrom the same constituency. However, his objection has beenrejected. So, it can be said that he has some interest in theelection process. He was from the same constituency for whichthe nomination of respondent No.7 had been accepted.Considering his interest, this Court is of the view that even ifthe petitioner was not the objector before the ReturningOfficer, he would not be expelled from bringing the illegality tothe notice of the Court of law. However, the learned counselsfor the respondents have correctly pointed out that theobjections raised by the petitioners were after the date ofraising the objections to the scrutiny. Rule 25 of theMaharashtra Co-operative Societies Election Rules, 2014 (forshort ‘Rules 2014’) provides that not only a member of thesociety but the Returning Officer at on own motion mayconsider the eligibility of the candidates at the time of thescrutiny by making a summary inquiry. Sometimes, it may notbe possible for the Returning Officer to discover the truth. Thevoters or the contesting members may know more than theReturning Officer. Every voter or candidate has to assist the 6 901-WP.1244-24, oral jud.odtReturning Officer in making an appropriate decision on theeligibility of the candidate to contest the election. RespondentNo.17 was one of the contesting candidates who had raised theobjection and subsequently did not prefer to impugn the orderof the Returning Officer. However, the petitioner has raised asimilar objection, which this petitioner has brought to thenotice of this Court. To maintain democracy, if any suchillegalities have been brought to the notice of the Court, suchillegalities cannot be ignored by closing the eyes. Courts arethe caretakers of everyone’s rights and protectors of the laws.Any illegality committed by anybody which appears on the faceof the record must be taken cognizance of. Considering theprinciple of law and duties of the Court, this Court is of theview that the petitioner, one of the candidates who submitted anomination for the same constituency, cannot be ineligible toimpugn the order. To examine the democratical rule ofelection, he may be an appropriate person to knock on thedoor of the Courts. The next objection raised in this petitionwas that all the contesting members had not been added asparty. 7 901-WP.1244-24, oral jud.odt5.Learned counsel Mr. Khandare for respondent No.7 hasvehemently argued that unless all the candidates have beenjoined as a party, the petition is untenable.6.To bolster his argument, he relied on the case ofVijaysingh Krishnarao Parabat Vs. Returning Officer, JanataSahakari Bank Ltd and others; 2003(2) Mh.L.J. 485. In thiscase, if bylaws No.9, it has been observed by this Court that asrightly submitted by the learned advocates for the respondents,the Division Bench has already held that in order to enable theparty to challenge the decision of Returning Officer as regardsthe rejection of nomination paper, all other candidates arenecessary parties to the proceedings and admittedly to theprocedure. 7.In reply, the learned counsel for the petitioner wouldsubmit that there are various constituencies for the election ofrespondent No.6. The nomination of respondent No.7 has beenaccepted for the Sugarcane Producers Members Constituencyof Kavsan Gut. All the candidates from that category havealready been added as a party. Since there were differentconstituencies, the Court is agreeable with the argument oflearned counsel for the petitioner that since there were 8 901-WP.1244-24, oral jud.odtdifferent constituencies, the other contesting members fromanother constituency are not necessary parties.8.Learned counsel Mr. Khandare for respondent No.7 hasvehemently argued that the documents placed on record showthat respondent No.7 is not the Director of the Sachin GhayalSugar Pvt. Ltd. He has referred to the documents filed by thepetitioner and vehemently argued that presently there are twoDirectors and the Ministry of Corporate Affairs indicates thattwo newly Directors have been appointed from 10.07.2022 and02.12.2022. He also vehemently argued that respondent No.7had transferred all of his shares. He is not concerned withSachin Ghayal Sugar Pvt. Ltd. He did not contest the electionas a member of the company. He is contesting in his owncapacity. He was a member of the society and complied withbylaws 28(2) of the society. He has vehemently argued that allthese questions are disputed facts. Therefore, the letter dated08.03.2023 bears the signature of respondent No.7 addressedto respondent No.6. It requires proof under what capacity hehas paid the election expenses. He has vehemently argued thatSection 73(CA) does not pertain to the company. It applies onlyto the societies that give loans to members for purchasingmachinery, implements, equipment, commodities or other 9 901-WP.1244-24, oral jud.odtgoods or that deal in such goods; no member of such society,who or whose member of the family is a dealer in such goodsor is a director of a company or partner in a firm carrying onbusiness in such goods, in the area of the operation of thesociety shall be eligible for being elected or nominated as amember of the committee of such society. He also referred toSub Section 1 and argued that respondent No.7 was neverindulged in any type of the business of the society as providedunder Sub Clause A1 and he was never the defaulter.Considering the category of the society contemplated undersaid Section. If assuming not admitting that respondent No.7 isthe Director of the company even then, this Section would notattract. Referring to Sub Clause (f)(iv) of Section 73(CA) SubSection (1), he vehemently argued that the company in thename of respondent No.7 does not carry on the business of thekind carried on by the society. The said company runs thesugar factory of respondent No.6 on the terms of the contract.Its status is independent. He has no concern with the businessof respondent No.6. His company does not carry any businessof a similar kind of society/respondent No.6 in the area of itsoperation. In simple words, he tried to argue that he was notthe competitor of the society of respondent No.6. His company,though not the Director, has no concern with the said, who was 10 901-WP.1244-24, oral jud.odtjust running the sugarcane factory on contract. In that capacity,the election expenses might have been paid. But that does notmean that it was paid in the capacity of the Director of the saidcompany. He prayed to dismiss the writ petition. 9.Per contra, learned counsel Mr. Choudhari forrespondent No.6 has vehemently argued that the objectionswhich have been raised here were not before the ReturningOfficer. Hence, in view of the ratio laid down in the case ofSanjay @ Raosaheb Yadavrao Waghchaure Vs. State ofMaharashtra and others (Writ Petition No.15083 of 2023) withother writ petitions dated 08.01.2024. The new objectionscould not be raised before this Court. Further referring to thejudgment of Jagdish Lahu Badhe Vs. State Co-operativeElection Authority and others in Writ Petition No.11684 of2022. He vehemently argued that no additional documentwould be allowed in this writ petition for the first time. If suchdocuments were not before the Returning Officer, suchdocuments could not be considered. He also prayed to dismissthe petition. 11 901-WP.1244-24, oral jud.odt10.The most important question to be determined in thiswritten petition is, “Whether Section 73(CA) would disqualifyrespondent No.7”? 11.The vehement argument of the learned counsel for thepetitioner indicates that he has a direct concern with SachinGhayal Sugar Pvt. Ltd. It appears that he had a connection withthe said company. However, there is no dispute that thecompany is running the business of respondent No.6 oncontract. The latest list of Director reveals that he is not theDirector of the said company. However, there is no evidencebefore the Court that he has transferred his 90% share tosomebody else. The Article of association of the said companyshows that the number of Director shall not be less than twoand not more than fifteen. Now there are two Directorsworking. 12.Learned counsel for the petitioner has argued that he hasappointed his driver as a Director. This dispute has no concernwith who has been appointed as a Director of the Company. Itis the job of the Company Secretary to examine whether theperson appointed as a Director is qualified to be appointed as aDirector. So, this appears to be irrelevant argument. There is 12 901-WP.1244-24, oral jud.odtno quarrel that Sachin Ghayal Sugar Pvt. Ltd. has noindependent sugarcane business in the operational area ofrespondent No.6. The Petitioner also did not dispute that thesaid company was running the sugar factory under thecontract. 13.As observed above, the crucial question is to be decidedin the disqualification of respondent No.7 under Section73(CA). The election program indicates that there are differentconstituencies for the election of respondent No.6 society. TheAct 1960, read with Rules of 2014, is a complete Code asregards the election, membership, qualification anddisqualification of the members and managing committee. ThisAct seems divided into parts, taking care of each type of voterand society. Reading Section 73(CA)(A1), there appears asubstance in the argument of learned counsel for respondentNo.7 Mr. Khandare, that it is a disqualification for the Directorof a company or a partner of the firm of a peculiar type of thesociety which gives loans to its member for purchasingmachinery, implements, equipment, commodities or othergoods. This seems to be a specific type of society, and anymember or Director or partner in a firm who carries on suchbusiness in such goods in the area of the operation of society is 13 901-WP.1244-24, oral jud.odteligible for being elected or nominated as a member of suchsociety. Sub-clause (i) is in continuation of Sub-clause (1-a) i.e.a default clause. Admittedly, respondent No.7 does not run anysimilar business as contemplated under sub-section A1 of thesaid Section. Clause (f)(v) is about carrying on the similarbusiness carried on by such society in the area of the operationof the society. It is the question of fact whether the originalobjector Mr. Mahesh Bombale, had placed all these documentsbefore the Returning Officer. Though he is made as respondent,he did not prefer to enter and put his appearance in thispetition. So, the inference could be drawn that the documentsplaced on record before this petition have been placed for thefirst time. Therefore, the ratio laid down in the case of JagdishLahu Badhe (supra) assists respondents Nos.6 and 7. In anutshell, it could be said that any documents the parties wantto rely upon should be before the first Authority unless the lawprovides for admitting such documents before the AppellateAuthority or the Court of writ jurisdiction. On substantialground, the petitioner failed to prove or satisfy the Court thatrespondent No.7, the Director of the sugar factory other thanrespondent No.6, has possessed the disqualification on theground mentioned under Section 73CA of the Act of 1960, andhe does the similar business like the society mentioned therein. 14 901-WP.1244-24, oral jud.odtApart from that, there is nothing on record to show that he hasa contract with the Sugar factory that incurs disqualification.Discussing the facts and the law in detail, this Court concludesthat the acceptance of the nomination of respondent No.7 islegal and valid and does not warrant interference with theimpugned order. 14.As a result, the writ petition stands dismissed.15.Rule stands discharged.16.The remedy to the petitioner to impugn the electionunder Section 91 of the MCS Act, 1060 has not been takenaway by this judgment. He may file the election petition, if hedesires. (S. G. MEHARE, J.)...vmk/-