High Court · 2025

Legal Reasoning

17345.2022WP.odtIN THE HIGH COURT OF JUDICATURE AT BOMBAYBENCH AT AURANGABADWRIT PETITION NO. 7345 OF 2022 1.Sanjay Dattatraya Kulkarni (Talegaonkar), Age : 52 years, Occ : Agri and Business, R/o Talegaon, Tq. Umri, Dist. Nanded. 2.Lingram Digambar KawaleAge : 62 years, Occ : Agriculture, R/o Sindhi, Tq. Umri, Dist. Nanded. 3.Bapurao Tulshiram Kadam (Patil)Age : 52 years, Occ : Agriculture, R/o Karkala, Tq. Umri, Dist. Nanded. 4.Marotirao Venkatrao KawleAge : 52 years, Occ : Agriculture, R/o Sindhi, Tq. Umri, Dist. Nanded. ..PETITIONERSVERSUS1.Shrinivas Bajirao @ Balajirao Deshmukh-Gorthekar Age : 65 years, Occ : Agri., R/o Gortha, Ta. Umri, Dist. NandedChairman Umri Sahakari Ginning and Pressing Society, Umri, Tq. Umri, Dist. Nanded. 2.Ganesh Sadhu SawantAge : 55 years, Occ : Business, R/o Gortha, Tq. Umri, Dist. NandedDirector, Umri Sahakari Ginning and Pressing Society, Umri, Tq. Umri, Dist. Nanded 3.Umri Sahakari Ginning and Pressing Society, Umri, Tq. Umri, Dist. NandedThrough its Manager

Legal Reasoning

27345.2022WP.odt4.District Deputy Registrar, Co-operative Societies, Nanded, Dist. Nanded. 5.The Assistant Registrar, Co-operative Society, Umri, Dist. Nanded. 6.A.G. GhogareOffice Superintendent, District Registrar Office, Co-operative Societies Nanded. (Deleted as per Court's order dated 14.07.2022) 7.The Divisional Joint Registrar, Co-operative Societies, Latur, Tq. and Dist. Latur. 8.The State of Maharashtra Through Secretary, Co-operative Department, Mantralaya, Mumbai. 9.The State of Maharashtra Through Hon'ble Minister, Co-operative Department, Mantralaya, Mumbai(Deleted as per Court's order dated 14.07.2022) 10.Shri K.S. Barkul Assistant Registrar (Administration, Co-operative Societies, Nanded, Tq. Nanded, Dist. Nanded Administrator Umri Sahakari Ginning and Pressing Society, Umri, Tq. Umri, Dist. Nanded (Added as per Court's order dated 03.07.2023) ..RESPONDENTS

37345.2022WP.odt…Mr. S.V. Natu h/f Mr.A.V. Indrale Patil, Advocate for thepetitioners Mr.S.B. Gahtol Patil, Advocate for respondent nos.1 to 3 and 10. Dr. Kalpalata Patil Bharaswadkar, Addl. G.P. for therespondent/State. …CORAM:ROHIT W. JOSHI, J.RESERVED ON :11th AUGUST, 2025PRONOUNCED ON:25th AUGUST, 2025JUDGMENT :The dispute in the present petition pertains toUmri Sahakari Ginning and Pressing Society, Umri (hereinafterreferred to as “the said society”), which is registered under theMaharashtra Co-operative Societies Act, 1960 (hereinafterreferred to as “the M.C.S. Act”). The petitioners are membersof the said society. Respondent Nos.1 and 2 are Chairman andDirector respectively of the said society. 2.The petitioner nos.1 to 3 and other members hadlodged a complaint dated 02.03.2020 with the Hon’bleMinister, Ministry of Co-operation, Government ofMaharashtra, levelling certain allegations with respect toworking of the said society, particularly with respect toattempt of members of the Managing Committee to sell the

Decision

47345.2022WP.odtland of the society by under-valuing the same. Pursuant tothe said complaint, the District Deputy Registrar (D.D.R.) hadcalled upon the Assistant Registrar to furnish a report withrespect to issues raised in the said complaint. The AssistantRegistrar submitted report dated 18.11.2020 stating that thesociety, which was formed for the purpose of ginning andpressing of cotton was non-functional and all the work ofginning and pressing was stopped from the year 2009. It isstated that society did not purchase cotton and also did notcarry out any operation of ginning and pressing for pastseveral years. It is stated that the entire income of the societywas only from rent received from the tenants. 3.In this backdrop and in the light of theobservations in the report that society had becomedysfunctional, D.D.R. passed order of interim liquidationunder Section 102(1)(c)(ii) and (iv) of the M.C.S. Act on08.02.2021. The said order was assailed by Respondent No.3 –Society and Respondent No.2 in Writ Petition No.3683/2021.After filing of the petition, the D.D.R. had withdrawn theorder dated 08.02.2021. The petition was disposed of in viewof the aforesaid with liberty to the respondents to initiate

57345.2022WP.odtfresh proceedings on the same grounds and take fresh decisionin the matter after granting opportunity of hearing to thepetitioners in the said petition (respondent nos.2 and 3 in thepresent petition). Thereafter, the D.D.R. passed interim orderof liquidation under the same provision i.e. Section 102(1)(c)(ii) and (iv) of the M.C.S. Act on 25.06.2021. It is observed inthe order that the society had stopped the work of ginning andpressing for past around 18 years and that it was apparentfrom the conduct of the office bearers of the society that theywere not interested in making the unit of the societyfunctional. It is also observed that the audit from the years2009 to 2016 was not conducted regularly and was done atonce at the end of the year 2016. This order of interimliquidation was followed by subsequent order of finalliquidation dated 29.07.2021. 4.Respondent Nos.1 to 3 preferred an Appealagainst the order of liquidation under Section 104 of theM.C.S. Act. The said Appeal was registered as AppealApplication No.88/2021. The said Appeal came to bedismissed vide order dated 17.11.2021 passed by theDivisional Joint Registrar of Cooperative Societies. Respondent

67345.2022WP.odtNos.1 to 3 preferred a Revision against the said orders, beingRevision Application No.581/2021 before the Hon’ble Ministerof Co-operation and Marketing, Government of Maharashtra.The Hon’ble Minister has allowed the said RevisionApplication vide order dated 23.06.2022. The order ofliquidation dated 29.07.2021 came to be quashed by the saidorder passed by the Revisional Authority. 5.The petitioners, who are members of the society,who had lodged the complaint, pursuant to which inquiry wasordered and the order of liquidation came to be passed havechallenged the said orders by filing present petition. 6.Mr. S.V. Natu, learned Advocate for the petitionerscontends that the Hon’ble Minister has erred in law inallowing the Revision Application. It is contended that theHon’ble Minister has transgressed the limits of revisionaljurisdiction while passing the impugned order. He contendsthat the impugned order, apart from being unsustainable onmerits, is also liable to be quashed only on the ground that theHon’ble Minister had heard the matter on 14.12.2021 and

77345.2022WP.odtpassed the impugned order on 23.06.2022, after a period ofaround six months and nine days. He states that theinordinate delay in deciding the matter itself is a ground forsetting aside the impugned order. He also states that theimpugned order is passed only in the wake of chaoticsituation that had arisen in June, 2022 relating to theformation of Government. He states that this was the periodwhen a political party which was the part of Government wasabout to split and there was a complete confusion anduncertainty with respect to existence of the Government. Heargues that it is apparent from the order passed by the Hon’bleMinister that the society was not functioning for inordinatelylong period, which is ground for passing order of liquidation,which was rightly invoked by the competent authority namelythe D.D.R. He also contends that the grounds for liquidationunder Section 102(1)(c)(iv) were also established, in as muchas, the society had let out its properties for a pittance and wasalso not maintaining accounts and carrying out auditregularly. 7.Per-contra, the learned Additional GovernmentPleader and the learned Advocate for Respondent Nos.1 to 3

87345.2022WP.odtsupport the impugned order. It is contended that the societywas unable to continue with the operations of ginning andpressing since the plant and machinery had become outdated.The learned Advocates contend that it was necessary togenerate funds for installation of new plant and machinery forwhich it had become necessary to sell a part of lands ownedby the society. The learned Advocates contend that the societyowns large tracks of land and it was necessary to sell someportion of these lands in order to generate funds. It iscontended that the Hon’ble Minister was completely justifiedin granting one chance to the society to recommence itsoperations. They contend that the decision of the Hon’bleMinister is in general interest of the members and farmingcommunity in the vicinity of the society. The learned Advocatefor respondent nos.1 to 3 has placed reliance on severaldecisions of the Hon’ble Supreme Court as also this Court tocontend that the scope of interference in a petition underArticle 227 of the Constitution of India is very limited and thatthis Court while exercising jurisdiction under Article 227 ofthe Constitution of India should not convert itself into Courtof Appeal to re-appreciate the facts or to substitute its owndecision with the decision rendered by the authorities.

97345.2022WP.odtLikewise, he has also placed reliance on some decisions of thisCourt interpreting Section 72 of the M.C.S. Act, wherein it isheld that final authority of every society is vested with thegeneral body of the members and that decisions taken by thegeneral body in the general body meeting are binding on thesociety and its members. He has also placed reliance oncertain authorities to contend that the petitioners do not havelocus to challenge the revisional order passed by the Hon’bleMinister. Placing reliance on the judgment of this Court in thematter of Hiradgaon Vividh Karyakari Seva Sahakari SocietyLtd. Vs. The State of Maharashtra and others, 2014(2) Mh.L.J.676, he contends that the State has wide powers whileexercising revisional jurisdiction under Section 154 of theM.C.S. Act and the power of this Court while testing the saidorder under Article 227 of the Constitution of India is limited.He has placed reliance on paragraph nos.14 and 15particularly, which read as under:- "14. Section 154 of the M.C.S. Act confers revisionalpowers to the State. Scope of the revisional powers isspecified under Section 154 of the M.C.S. Act. AMinister enjoys revisional powers under Section 154of the M.C.S. Act, not only on application of any party,but suo moto may call, examine and may consider the

107345.2022WP.odtlegality and decision and order of the Sub-ordinateOfficer and also verify the regularity of thoseproceedings and if at all it appears to the HonourableMinister, then he may modify, annul or reverse suchorder. Thus, the State has wide powers and the Statecan modify the order passed by the Sub-ordinateOfficer and so also can reverse the said orderHowever, it is necessary that the revisional authorityshould be satisfied that the order passed below is notproper and is illegal. This Court has limited powersunder Article 227 of the Constitution while issuing awrit of certiorari. Though these are plenary powers,the High Court may refuse to invoke the writjurisdiction, even if a possible view is taken, out oftwo available views by the revisional authority. If theorder passed by the revisional authority is erroneous,ex facie, then interference under the writ jurisdictionis justifiable. On the background of this legal position,the proceedings before the Court are examined.15. While invoking writ jurisdiction no need to gointo the merits of the matter, i.e. whether a particularsociety was having how many members, what was itsfinancial capacity etc. The order can be tested only onthe point of illegality which should be self-evident."8.The learned Advocate also contends that theorder passed by the Appellate Authority is unsustainable since

117345.2022WP.odtit is a non-speaking order. 9.Heard respective Advocates as aforesaid, perusedthe orders passed by the authorities and other documentsplaced on record. 10.It appears that the fact that the society is notcarrying out the operations of ginning and pressing, which isthe chief objective of the society, is not in dispute. Likewise, itis also matter of record that audit of accounts of society wasnot carried out regularly in the past. 11.The learned Advocate for respondent nos.1 to 3is justified in contending that this Court, in exercise of itssupervisory jurisdiction, under Article 227 of the Constitutionof India cannot sit in Appeal over the impugned order passedby the Hon’ble Minister and that this Court should not act asan Appellate Court while dealing with the petition challengingthe said order. Having said so, it also needs to be stated that itis well within the authority of this Court to step-in in caseswhere the authorities do not act within the scope of their

127345.2022WP.odtjurisdiction. In the event it is found that the authorities haveexceeded their jurisdiction or have not exercised jurisdictionin accordance with law, it will be open for this Court tointerfere with the matter in exercise of its powers underArticle 227 of the Constitution of India. The judgment in thematter of Celina Coelho Pereira and others Vs. UlhasMahabaleshwar Kholkar and others, 2010(1) SCC 217, reliedupon by the petitioners clarifies this legal position. In the lightof this settled legal position that the order passed by theHon’ble Minister needs to be tested. 12.The impugned order is passed in exercise ofpowers vested under Section 154 of the M.C.S. Act. Powerunder Section 154 can be exercised either on an application orsuo-moto. The scope of jurisdiction under Section 154 is totest the legality of an order passed by an Officer under theM.C.S. Act or propriety of any decision or order passed underthe Act. Likewise, it is also open for the Hon'ble Minister toexamine the regularity of proceedings in which orders arepassed by the Officers functioning under the Act. Thus, thejurisdiction under Section 154 is restricted to examining thelegality or propriety of orders passed by the authorities under

137345.2022WP.odtthe Act and/or to examine regularity of proceedings in whichsuch orders are passed. In exercise of powers of revision underSection 154, the Hon’ble Minister cannot re-appreciate theevidence or substitute his discretion for the discretionexercised by the concerned officers. 13.In this context, when the impugned order passedby the Hon’ble Minister is seen, it is found that, the Hon’bleMinister has not recorded any finding that the order ofliquidation passed by the D.D.R. is illegal or improper. TheHon’ble Minister has also not found any fault with theprocedure followed by the said authority while passing theorder of liquidation. The Hon’ble Minister has observed that itwill be appropriate that one more opportunity is granted tothe society to recommence its activities. While arriving at thisconclusion, the Hon’ble Minister has observed that the societywas trying to generate funds by selling some of its immovableproperties. It is observed that litigation was also on going withrespect to decision taken by the society to sell its properties,and therefore, the properties could not be sold to generatefunds.

147345.2022WP.odt14.Perusal of the impugned order will thusdemonstrate that the Hon'ble Minister has quashed the orderof appointment of liquidator, although it is not found that theorder suffers from any illegality or impropriety or that theproceeding in which the order is passed suffers from anyirregularity. It is apparent that Hon'ble Minister has exceededhis jurisdiction while deciding the revision under Section 154of the M.C.S. Act by substituting his discretion with that ofD.D.R. In the considered opinion of this Court, the orderpassed by the Hon'ble Minister suffers from a jurisdictionalerror. In this regard, it will be appropriate to refer to thejudgment in the matter of Hiradgaon Vividh KaryakariSahakari Seva Society Ltd., (supra) relied upon by the learnedcounsel for respondent nos.1 to 3, wherein it is held that,although, the power under Section 154 is wide and includespower to modify and also reverse the orders impugned, thisCourt has categorically held that the revisional authorityshould first satisfy itself that the order impugned is not properand is illegal. Revisional jurisdiction under Section 154 can beinvoked only if the order is improper or illegal. In view of theabove, in the considered opinion of this Court, the order dated23.06.2022 cannot be sustained and is liable to be quashed.

157345.2022WP.odt15.The contention of learned Advocate for thepetitioners that the impugned order is passed after aninordinate delay of over six months and that too in the light ofpolitical uncertainty creating existential crises of theGovernment is not being tested in view of the finding arrivedat by this Court that the impugned order is passed byexceeding the scope of jurisdiction under Article 154 of theM.C.S. Act. 16.Mr.S.B. Ghatol Patil, learned Advocate forrespondent nos.1 to 3 states that the order dismissing theappeal passed by the learned Divisional Joint Registrar is alsounsustainable, in as much as, the appeal preferred byrespondent nos.1 to 3 is dismissed by non-speaking order.Drawing attention of this Court to the said order, he contendsthat the appellate authority merely recorded rival contentionsand has dismissed the Appeal without recording any reasons.He points out from the order that, although, the order runsinto several pages, only reason recorded while dismissing theAppeal is as under:-

167345.2022WP.odt"izfroknh dz-4 rs 11 iSdh mejh ftfuax o izsflax lgdkjhlkslk;Vh fy- mejh ;k laLFksps lapkyd o lHkkln R;kp cjkscjbrj 'ksrdjh ;kaps Eg.k.ks fopkjkr ?ksrk vkf.k izfroknh dz-1 ;kapsys[kh Eg.k.ksuqlkj] rlsp lquko.kh njE;ku lknj dsysY;k miyC/kdkxni=kaps voyksdu dsys vlrk mejh ftfuax o izsflax lgdkjhlkslk;Vh e-mejh gh laLFkk eatwj mifo/khrhy mnsn'kkizek.ksdkedkt djhr ulwu lnj laLFksps dkedkt c&;kp o"kkZiklwu canvlY;kps fnlwu ;srs- dfjrk [kkyhy izek.ks vkns'k ikfjrdj.;kr ;sr vkgs-" True translation of the above portion made by theChief Translator of PG Cell of this Court is as under :-"Considering the statements of the directors andmembers of the Umri Ginning and PressingCooperative Society Limited, Umri, respondents Nos.4to 11, as well as other farmers, as also the writtensubmissions of the respondent No.1, and the availabledocuments submitted during the hearing, it appearsthat the Umri Ginning and Pressing CooperativeSociety Limited, Umri is not functioning as per theobjectives of the approved bye-laws and thefunctioning of the said society has been closed formany years. The following order is hereby passed." The learned advocate, therefore, contends that theappellate order is also unsustainable and is liable to be

177345.2022WP.odtquashed and set aside. His contention is that although, theHon'ble Minister has not set aside the appellate order onthis ground, the contents of the order are a matter ofrecord and perusal of the order passed by the appellateauthority gives rise to only one conclusion that the saidorder is non-speaking order, which is unsustainable andaccordingly, it is liable to be quashed. 17.Mr. Natu, learned Advocate for the petitionersstates that the scope of present petition is to decidecorrectness or otherwise of the order passed by the Hon'bleMinister. He contends that whether to interfere or not with theorder passed by the appellate authority should be left to bedecided by the Hon'ble Minister. His contention is that theorder passed by the Hon'ble Minister deserves to be quashedand set aside and the matter should be remanded to theHon'ble Minister to decide the revision afresh. 18.Having considered the rival submissions, it isapparent that the order passed by the appellate authority isclearly unsustainable since it is a non-speaking order. The

187345.2022WP.odtAppellate Authority has not dealt with contentions raised byrespondent nos.1 to 3, who had preferred Appeal against theorder of liquidation passed by the D.D.R. A non-speakingorder is dead letter in the eyes of law. The Appellate Authorityhas virtually deprived respondent nos.1 to 3 of right to appealwhich is valuable statutory right. Remedy of appeal would berendered meaningless, if appellate authorities are allowed todecide appeals without recording any reasons and withoutdealing with rival contentions raised in appeal. 19.Normally on finding that the order passed by therevisional authority, which is impugned in the present petition,is unsustainable, the matter would have been remanded to therevisional authority to decide the revision afresh. However, inthe facts of the present case, it is obvious that the order passedby the appellate authority is completely unsustainable. Therecannot be any second opinion about the fact that the saidorder is non-speaking order, which cannot withstand thescrutiny of law. In the considered opinion of this Court, it will,therefore, be expedient to allow the petition in part bymaintaining the order passed by the Hon'ble Minister to theextent it has quashed and set aside the order passed by the

197345.2022WP.odtappellate authority. The Appeal needs to be restored to filewith directions to the appellate authority to decide the Appealafresh by dealing with all the rival contentions and by passingthe speaking and well reasoned order. In the result, thepetition is partly allowed as under:- ORDER(i)The order dated 23.06.2022 passed by the Hon'bleMinister of Co-operation and Marketing, Government ofMaharashtra in Revision REv-2021-Pra.Kra 589/15(s)Shri Shrinivas Bajirao Deshmukh and two others Vs. DivisionalJoint Registrar, Co-operative Societies, Latur Division, Laturand others and the order dated 17.11.2021 passed by theDivisional Joint Registrar of Co-operative Societies, Latur, inAppeal No.88/2021 are quashed and set aside. (ii)Appeal No.88/2021 decided by the Divisional JointRegistrar, Co-operative Societies, Latur is restored to file of thesaid authority with directions to decide the said Appeal bydealing with all the rival contentions and passing a reasonedorder. (iii)The parties shall appear before the Divisional JointRegistrar, Co-operative Societies, Latur on 08.09.2025. The

207345.2022WP.odtparties to note that separate notice for appearance will not beissued. (iv)The Divisional Joint Registrar, Co-operative Societies,Latur is directed to decide the Appeal, as early as possible andin any case, before 31st December, 2025. (v)Writ Petition stands disposed of. (vi)The Civil Applications, if any, stand disposed of. [ROHIT W. JOSHI, J.] sga/2025