Babasaheb Shrimantrao DeshmukhVERSUSThe Divisional Joint Registrar and othersMr v. D. Salunke
Legal Reasoning
seriously since the subject is of grave importance.” Thelearned Judge proceeded to add: “Therefore, it follows thatthe President must communicate to the Chief Justice all thematerial he has and the course he proposes. The ChiefJustice, in turn, must collect necessary information throughresponsible channels or directly, acquaint himself with therequisite data, deliberate on the information he possessesand proceed in the interests of the adminstration of justiceto give the President such counsel of action as he thinkswill further the public interest, especially the cause of thejustice system.”15.It is thus clear from the above observations that the word“consult” implies a conference of two or more persons and an impact of two ormore minds in respect of topic in order to enable them to evolve correctsolution. Thus, what was required for such consultation is that one partycommunicates all material he has during the course he proposes an action andintern. The consultee is also expected to collect necessary information and todeleberate upon the opinion expressed by the consultor. In the instant case, thefacts on record indicates that no such requirement of real consultancy has beenundertaken.16.Division Bench of this Court in case of Suresh Khumkar (citedsupra) while dealing with the provisions of the Act has held that when theRegistrar had sent only a copy of show-cause notice and no other relevantmaterial to the Federation so that it could form its opinion and sent it to theWP-7504-2020.odt11 of 13 Registrar within reasonable time. There would be no effective consultation andhence, the order passed was set aside.17. In the present case too, except for sending the copy of show-causenotice that too not under the provisions of Section 79(A) but under theprovisions of Section 79(1) of the Act, no other material is forwarded toFederal society. As contemplated to proviso of Sub-section 3 of Section79(A), opinion of the Registrar was not also communicated to the Federation inorder to respond to the same with application of mind. Thus, the secondproviso to Sub-section 3 thereof would not apply to the present case.Consequently, the act of sending of the copy of the show-cause notice to theFederal society cannot be termed as a compliance as contemplated by provisoto Section 79(A)(3).18.The entire record more than sufficiently demonstrates that theaction taken against the petitioner even if is accepted to have been taken underSection 79(A), for want of mandatory compliance of Section 79(3), the orderimpugned passed by Divisional Joint Registrar is not tenable. The Hon’bleRegistrar has failed to take into consideration the relevant provisions and erredin dismissing the appeal.19.Now question arises as to what relief the petitioner is entitled. It isWP-7504-2020.odt12 of 13 admitted fact that the petitioner was terminated on 31.12.2019 and was tosuperannuate in September, 2021. Learned counsel for petitioner, oninstructions, make statement that petitioner does not claim any backwageshowever he is entitled for the retiral benefits. Since, the order of terminationitself is not maintainable, the same is set aside. It is held that the petitionerwould be entitled to receive retiral benefits as if he was not terminated fromservice but without any backwages.20.Petition therefore, stands allowed in above terms.21. Pending Civil Application, if any, stands disposed of.(R. M. JOSHI, J.)bsjWP-7504-2020.odt13 of 13
Arguments
IN THE HIGH COURT OF JUDICATURE AT BOMBAYBENCH AT AURANGABADWRIT PETITION NO. 7504 OF 2020Babasaheb Shrimantrao DeshmukhVERSUSThe Divisional Joint Registrar and othersMr. V. D. Salunke, Advocate for PetitionerMr. D. J. Choudhari, Advocate for Respondent No. 2Mr. S. K. Shirse, AGP for Respondent Nos. 1 and 3/StateCORAM: R. M. JOSHI, J.DATE: 05 August, 2025PER COURT :-1.This Petition takes exception to the order dated 19.12.2019 passedby Divisional Joint Registrar Co-operative Societies, Latur and order dated14.10.2020 passed by the Hon’ble Minister for Co-operation and TextileDepartment, Mantralaya, Mumbai rejecting the appeal filed before theMinister.2.The facts which led to the filing of this petition can be narrated inbrief as under :Petitioner worked as a Manager from 2011 onwards. He washolding additional charge of the Chief Executive Officer (for short “CEO”) ofDCC Bank, Beed in the year 2016. Said election was for a period of 5 years.WP-7504-2020.odt1 of 13 On 28.06.2017, GR was issued by the State Government promulgatingChatrapati Shivaji Maharaj Shetkari Sanman Yojana-2017 (herein called as“Scheme” for the sake of brevity) extending monetary benefits to theagriculturist. Corrigendum was also issued on 05.07.2020 and 20.07.2017. Therespondent-bank was called upon to implement the said scheme. In connectionwith this GR, Writ Petitions were filed before this Court being Writ PetitionNo. 11383/2015 and Writ Petition No. 35961/2016 wherein some directionswere came to be issued in respect of the recovery of dues and payment ofmoney to the depositors. It is claimed by the petitioner that the bank hadfollowed the said directions issued by this Court. It is further claimed by thepetitioner that the bank has received the amount under the scheme, and sinceno individual was member of the bank, loan is given and repaid only throughVKSS Societies. It is thus claimed that amount received under Scheme isforwarded to the said societies to pay the same to the agriculturist. It is alsoclaimed that there is no grievance made by any agriculturist in this regard.3.It is further case of the Petitioner that Respondent No. 1 –Divisional Joint Registrar of the Co-operative Society issued show-causenotice dated 15.11.2018, 31.12.2018 and 18.01.2019 under Section 79 (1) ofthe Maharashtra Co-operative Societies Act, 1960 (for short “the Act”) and thepetitioner was called upon to explain as to why the action under Section 79(3)WP-7504-2020.odt2 of 13 of the Act should not be taken against him. Petitioner claims to have replied thesaid show cause notice with supporting documentary evidence. It is alleged bythe petitioners that owing to the political rivalry/equations, the Divisional JointRegistrar without considering the reply passed by order dated 19.12.2019 andremoved petitioner from the post of Chief Executive Officer (for Short“CEO”). It was further directed that the Management to dismiss the CEO of theBank and appeal came to be filed against the said order before the Hon’bleMinister. The appeal before the Minister was heard and Minister dismissed thesaid appeal by order dated 14.10.2020. Hence, this petition.4.Learned counsel for petitioner submits that perusal of the show-cause notices indicate that the notices are issued under Section 79(1) of theAct. It is his contention that Section 79(2) provides for the procedure to beadopted before passing order under Section 79(3) of the Act. By referring tothe said provisions, it is submitted that Section 79(3) contemplates passing oforder of imposing penalties does not empower the Authority to remove anyperson from the post or to qualify him. It is his submission by referring to thesaid show-cause notice that petitioner was not called upon to show-cause as towhy he should not be removed from the post of CEO of the Respondent-Bank.Thus, it is his contention that the said notice was never under Section 79(A) ofthe Act but was always under Section 79(1). It is his further submission thatWP-7504-2020.odt3 of 13 Section 78 read with Section 64(2) of the Act requires consultation with thefederal society before removal of any employee or the CEO includingChairman. By relying upon the judgment of Hon’ble Supreme Court in case ofUnion of India Vs Sankalghand Himatlal Sheth 1977 AIR(SC) 2328, it isargued that whenever a consultation is contemplated that would not be aformality but the consultation should be meaningful. It is his submission thateven accepting the fact that the copies of show-cause notice were marked tothe Federal society, it cannot be said that there was consultation ascontemplated by Section 79(A) of the Act. To support his submissions heplaced reliance on following judgments :-i) Suresh Dnyandeo Khumkar & others Vs. State of Maharashtra & others1987 (3) Bom. C.R. 211ii) Ravindra V. Gaikwadand others Vs. State of Maharashtra and others2002 (5) Mh.L.J. 464iii) S. P. Gupta Vs. President of India and others AIR 1982 SC 1495.Learned counsel for Respondents-Bank supported the impugnedorder. It is his contention that merely because wrong provision is recorded inthe show-cause notice, it does not become so. According to him the action hasbeen initiated under Section 79(A) of the Act and in view of the amendmentand with introduction of Second proviso to Section 79(A), there is deemedWP-7504-2020.odt4 of 13 permission of Federal society if the proposal is not responded within a periodof 45 days. It is his submission by referring to the notices issued to thepetitioner that the copies of the said notice were duly marked to the Federalsociety and in absence of any response from the society, there is deemedsanction of the Federal society to the action of removal of the petitioner.6. Learned AGP has placed reliance on the judgment of Hon’bleSupreme Court in case of N. Mani Vs. Sangeetha Theatre and others (2004)12 SCC 278 to contend that if an Authority has power in the law merelybecause while exercising the said power, a source of power is not specificallyreferred or a reservations made to a wrong provisions of law that by itself doesnot vitiate the exercises of the power.7.There cannot be any dispute made with regard to the propositionsought to be canvassed by the learned counsel for respondents that the wrongquotation of the provision of law by itself would not make such show-causenotice under different provision of law. However such intention of authoritymust be disclosed from bare reading of contents of the show-cause notice.Perusal of show-cause notice clearly shows that the show-cause notice is notonly issued under Section 79(1) but it also contemplates that the action wouldbe initiated under Section 79(3) of the Act. Even, otherwise the said show-WP-7504-2020.odt5 of 13 cause notice does not contemplate the removal of the petitioner from the postheld by him. This Court, therefore, finds no reason to accept the contention oflearned counsel for the respondents that it was mere a mistake on the part ofAuthority to issue notice by mentioning Section 79(1) instead of Section79(A). Having regard to the nature of show-cause notice, it cannot be held thatthe notice intended was under Section 79(A) but wrongly/inadvertentlymentioned under Section 79(1) of the Act. Needless to say that in the exerciseof powers under Section 79(1) to 79(3), Registrar cannot take action ofremoval of the CEO or an employee.8.Assuming that the notice was issued under Section 79(A) of theAct, it needs to be seen as to whether there is compliance of the said provisionsin order to sustain impugned orders. At this stage, it would be relevant to takenote of the provisions of Section 79(A) which reads thus :-79A. [Government's power] to give directions in thepublic interest, etc.(1) If the State Government, on receipt of a report from theRegistrar or otherwise, is satisfied] that in the publicinterest or for the purposes of securing properimplementation of co-operative production and otherdevelopment programmes approved or undertaken byGovernment, or to secure the proper management of thebusiness of the society generally, or for preventing theaffairs of the society being conducted in a mannerdetrimental to the interests of the members or of theWP-7504-2020.odt6 of 13 depositors or the creditors thereof, it is necessary to issuedirections to any class of societies generally or to anysociety or societies in particular, the State Government mayissue directions to them from time to time, and all societiesor the societies concerned, as the case may be, shall bebound to comply with such directions.(2) The State Government may modify or cancel anydirections issued under subsection (1),and in modifying orcancelling such directions may impose such conditions as itmay deem fit.(3) Where the Registrar is satisfied that any person wasresponsible for complying with any directions or modifieddirections issued to a society under sub-sections (1) and (2)and he has failed without any good reason or justification,to comply with the directions, the Registrar may by order--(a) if the person is a member of the committee of thesociety, declare him to be disqualified to be or to continue tobe a member of the committee of any society, for a period ofsix years from the date of the order;(b) if the person is an employee of the society, directthe committee to remove such person from employment ofthe society forthwith, and if any member or members of thecommittee, without any good reason or justification, fail tocomply with this order, declare them disqualified asprovided in clause (a) above :Provided that, before making any order under thissub-section, the Registrar shall give a reasonableopportunity of being heard to the person or personsconcerned and consult the federal society is affiliated.Provided further that, such federal society shallcommunicate its opinion to the Registrar within a period offorty-five days from the date of receipt of communication,failing which it shall be presumed that such federal societyhas no objection to take action under this section and theWP-7504-2020.odt7 of 13 Registrar shall be at liberty to proceed further to take actionaccordingly. Any order made by the Registrar under this section shall befinal.9.Section 79A(3) of the Act mandates recording of satisfaction byRegistrar of any person being responsible for complying directions, underSection 79A (1) and (2) has failed in its compliance without good/justifiedreasons. Here in this case, the petitioner has tendered explanation to the show-cause notice. The Registrar therefore, ought to have recorded its satisfactionthat petitioner has not complied with directions without justification. It isthereafter the second stage would come in play. The Registrar thereafter shallform an opinion of disqualification of a member/CEO and removal ofemployee. It is at this stage also such person to be disqualified gets opportunityof being heard. Similarly, it mandates consultation with Federal society beforeactual removal.10.Thus, this provision clearly requires Registrar to hear theconcerned member/CEO/employee on the point of his removal from thepost/employment. It would therefore, be obligation on the part of Registrar toissue notice to such person indicating his intention to take such action. Since,the consequence of such order is drastic in nature, the rule must be compliedWP-7504-2020.odt8 of 13 with strictly.11.In the instant case, at no point of time, petitioner was heard on thepoint of removal from the post of CEO or as Chairman of the society. Thus,there is non compliance of the provision, which is mandatory in nature. Evenotherwise, unless notice is issued under Section 79(3) of the Act disclosingintention to take action under Section 79(3)(A) or (B) of the Act, it would notbe open for Registrar to claim subsequently that notice was issued underSection 79(A) of the Act, by issuing notice under Section 79(1) of the Act, asboth powers are to be exercised in two different situations.12.Suffice it to say that since no show-cause notice has been issued topetitioner for this removal and as no opportunity of hearing was rendered tohim, the order of removal cannot sustain.13.Now coming to the issue of the consulation with the Federalsociety and its implication is concerned, record indicates that the show-causenotice forwarded to the Federal society does not indicate action of removal ofpetitioner being contemplated therein. Even if it is accepted that in view ofSecond proviso on expiry of 45 days of communication by Registrar of itsopinion to remove CEO/employee, if Federal society fails to communicate itsopinion, then it shall be presumed that Federal Society has no objection to takeWP-7504-2020.odt9 of 13 action under this Section, but question is that whether such presumption wouldapply in this case. There is no need to emphasize that the consultation withFederal society is not an empty formality. The provision clearly shows thatRegistrar is required to communicate his opinion of removal of theCEO/employee under Section 79(A)(3)(a) or (b) of the Act and it is only whensuch opinion is communicated, question of application of deeming provisionwould arise.14. It would be fruitful to take note of the Constitution Bench of theHon’ble Supreme Court in case of Union of India Vs. Sakalghand HimatlalSheth (cited supra) wherein the Hon’ble Supreme Court has held as to theamendment of consultation. Paragraph No. 29 of the said judgment isreproduced herein below :-“the word ‘consult’ implies a conference of two or; morepersons or, an impact, of two or more minds in respect of atopic in order to enable them to evolve a correct or at-leasta satisfactory solution” and added “In order that the twominds may be able to confer and produce a mutual impact,It is essential that each must have for its consideration fulland identical facts which can at once constitute both thesource and foundation of the final decision”. Krishna Iyer,J. speaking on behalf of himself and Fazal Ali, J. alsopointed out that “all the materials in the possession of onewho consults must be unreservedly placed before theconsultee and further a reasonable opportunity for gettinginformation, taking other steps and getting prepared fortendering effective and meaningful advice must be given tohim,” and “the consultant in turn must take the matterWP-7504-2020.odt10 of 13