Ordjud

2023:BHC-AS:17453-DB
kishor 1/27 wp 6199 of 2023 as.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY

CIVIL APPELLATE JURISDICTION
WRIT PETITION NO.6199 OF 2023
1. Nashik Zilla Sarkari & Parishad

Karmachari Sahakari Bank Niyamit, Ltd.,
Nashik Soma Heights, Samata Sankul, 1st
Floor, Bhabha Nagar, Near mumbai Naka,
Nashik-422011
2. Mahesh Daguju Avhad

Age : 67 years, Occu.
R/o. Kalanagar Akash Petrol Pump,
Dindori road, Flat No.8,
Shivjyot Housing Society, Nashik,
Maharashtra-422 004.
3. Ramesh Kachru Rakh

Age : 70 years, Occu. :
R/o. Plot No. 38, Sarang Bangla,
Jantaraja Colony, Makhmalabad Canel
Link Road, Panchavati, Nashik,
Maharashtra – 422 003.
4. Nivrutti Deoram Sanap

Age : 71 years, Occu. :
R/o. Indira Nagar, Malhar Bungalow,
Survey No. 84/2/2A/1, CIDCO colony,
Nashik, Maharashtra – 422 009
5. Subhash Trimbak Pawar

Age : 75, Occu. :
R/o. Saptshrungi Apartment, Plot No.2,
Survey No.876/2/3/2, Indira Nagar,
Nashik – 422 009 ...Petitioners
1/27
::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

VERSUS
1. The State of Maharashtra

Through its Secretary
Co-operative Society Maharashtra State,
Mantralaya, Mumbai-32.
2. The State Co-operative Election Authority

Maharashtra State, Pune
Old Central Building
Ground Floor, Pune-411 003
3. The District Election Officer &

District Deputy Registrar
Co-operative Societies,
Nashik.
4. The Election Branch Chief &

Assistant Registrar (II),
Co-opeartive Societies,
Nashik, Dist. Nashik
5. Commissioner for Co-operation &

Registra, Maharashtra State,
2nd Floor, New Central Building,
Pune-411 001
...Respondents
Appearances:
Mr.Nitin Gaware Patil for Petitioner.
Mr. Dilip Patil Bankar, Chief Standing Counsel SCEA a/w. Ms. Pooja D.
Patil for Respondent No.2 & 3.
Mr. Sanjeev B. Deore, a/w. Ms. Suchita Pawar for intervener.
2/27

Mr. A. I. Patel, Addl AGP a/w. N. K. Rajpurohit, AGP for State.
CORAM: DHIRAJ SINGH THAKUR &

SANDEEP V. MARNE, JJ.
DATE : 21 JUNE 2023.
JUDGMENT : (Per – Sandeep V. Marne, J.):
Rule. Rule is made returnable forthwith. With the consent of

parties, petition is taken up for final hearing.
2. Petitioners before us are Nashik Zilla Sarkari and Parishad

Karmachari Sahakari Bank Ltd., which is a Salary Earner’s Co-operative
Bank and some of its members, who are retired employees. Petitioners
have filed the present petition challenging communication dated 10
February 2023 issued by State Co-operative Election Authority (SCEA).
By the impugned communication, the SCEA has issued directives to all
District Co-operative Election Officers not to include names of retired
employees while preparing provisional list of voters for conducting
elections of salary earner’s co-operative credit societies. The challenge is
essentially raised on the ground of lack of jurisdiction on the part of
SCEA to issue such directives.
3/27

3. Petitioner No.1 is a Society registered under the provisions of

Maharashtra Co-operative Societies Act, 1960 (Act of 1960). Petitioner
No.1 is also a Bank. In Exhibit-A to Petition giving particulars about
Petitioner No. 1 bank, it is described as a ‘salary earners cooperative
society’. It has salaried employees of the State Government and Zilla
Parishads, State Government Undertakings and Municipal Corporation
as its members excluding police officials and primary teachers. Retired
employees of these establishments are also members of the society.
Byelaws of Petitioner No. 1 Society are filed along with the Petition,
which permit retired employees being enrolled as its members.
4. The last elections of Petitioner No.1 Bank were held on 18

June 2017 and the period of 5 years came to an end on 18 June 2022.
Elections of Petitioner No.1 Bank and other similarly situated co-
operative societies were postponed by the State Government. SCEA
issued directives to all District Co-operative Election Officers to
commence election process of various societies from 1 March 2023 and
to complete the same by 30 June 2023. The District Co-operative
Election Officers were directed to prepare provisional list of voters by 1
February 2023.
5. On 10 February 2023, SCEA issued impugned

communication directing District Co-operative Election Officers not to
include names of retired employees in provisional voters lists. Petitioners
4/27

are aggrieved by impugned communication dated 10 February 2023 and

have accordingly filed the present petition. What Petitioners essentially
question is the authority of the SCEA to issue such directives under
Section 73CB of the Act of 1960. They contend that deletion of names
of retired employees of Petitioner Bank would result in deletion of their
names from membership register, which power can be exercised under
Section 25A by the Registrar alone, that too after following the procedure
prescribed. That the issue of eligibility to continue as a member is to be
decided in accordance with the Byelaws of each society and therefore the
SCEA could not have issued general directions for deletion of names of
retired employees from provisional list of voters of all salary earners’
credit cooperative societies.
6. The Petition was moved before vacation court on 9 th May

2023 and upon a submission made on behalf of Petitioners that SCEA
has directed deletion of ‘members’ of Petitioner No. 1 bank, this court
passed interim order staying the impugned communication dated 10
February 2023. The interim order passed on 9 May 2023 reads thus:
1. Issue notice to the respondents, returnable on 12th June 2023.

2. The learned counsel for the petitioner invited our attention to the order
dated 6th April 2023 passed by co-ordinate bench of this Court (Nagpur
Bench) in Writ Petition no.2254 of 2023.
2. According to the petitioner, the Election Authority has no power under the
Act or Rules to issue directions to delete the members. He invited our
attention to eligibility of membership. He also invited our attention to the
Bye-laws which provide for cessation of membership. According to him, none
5/27

of the Bye-laws contained any disqualification for the members who have
superannuated in the service.
3. In view of the said submission, prima facie, we are satisfied that the
Election Authority has no power to issue such direction either under Section
73-CB coming under Rule 3 or 5 of the Maharashtra Co- operative Societies
(Amended) Rules 2015.
4. By this ad-interim relief, it is directed that the impugned communication
dated 10th February 2023 shall remain stayed.
5. Leave to amend to challenge the order of rejection of objections raised by
the petitioner.
7. While seeking interim relief on 9 May 2023, Petitioners

relied upon Interim Order dated 6 April 2023 passed by Division Bench
of this Court, Bench at Nagpur in Writ Petition No. 2254 of 2023,
which reads thus:
Challenge raised by the petitioner, which is a Society registered under

the Maharashtra Cooperative Societies Act, 1960, is to the direction
issued by the respondent no.1 State Cooperative Election Authority on
10/2/2023 by which the Society has been directed to delete the names
of members, who have since retired from service while preparing the
provisional voters’ list. It is submitted by Shri Saboo, learned Counsel
for the petitioner, that the Society is governed by the Bye-laws that
have been duly approved by the District Deputy Registrar and the
same do not provide for cessation of membership of those employees,
who have retired from service. Relying upon the provisions of Section
22 of the said Act, it is urged that the aforesaid contingency is not
provided therein.
2) Issue notice, returnable in two weeks.

3) Shri. Ghate learned counsel waves notice for the respondent no.1.
Ms. Mehta, learned Assistant Government Pleader waives notice for
the respondent no.2.
6/27

4) In the meanwhile, no further steps be taken by the respondent no.1

against the petitioner Society for ensuring compliance of the
communication dated 10/2/2023.
8. Appearing for Petitioners, Mr. Nitin Gaware the learned

counsel would submit that the directives issued by the SCEA vide
impugned communication are wholly without jurisdiction. That Section
73CB of the Act of 1960 does not vest jurisdiction in SCEA to issue
directives for deletion of names of retired employees, as the same would
have direct effect on their right to remain as a member of the society. He
would draw our attention towards the provisions of the Maharashtra Co-
operative Societies (Election of Committee) Rules 2014 (Rules of 2014)
to submit that there is elaborate procedure prescribed for preparation of
provisional list of voters. That there is an inbuilt mechanism of raising
objections for preparation of provisional and final list of voters under the
Rules and that therefore till commencement of the stage for preparation
of provisional list of voters, there was no occasion for the SCEA to issue
general directives for deletion of names of retired employees from
provisional list of voters. That such an action on the part of SCEA
amounts to putting a cart before horse. That SCEA has essentially
tinkered with membership register of Petitioner No.1 Bank. He would
submit that deletion of names of retired employees from provisional
voters list would automatically entail cancellation of their membership.
Relying on provisions of Section 25A of the Act of 1960, Mr. Gaware
7/27

would contend that only the Registrar has power to decide issue of
membership and that the SCEA has no jurisdiction in that regard. He
would submit that there is a detail procedure prescribed for striking off
any name from membership register and that unless such procedure is
followed, names of members of Petitioner No.-1 Bank cannot be
knocked off by issuing general direction by the SCEA. That Petitioner
No.1-Bank has issued share certificates to its members and cancelation of
membership would result in cancellation of share certificates and refund
of share money to such members. Unless such an exercise undertaken,
SCEA could not have issued a general direction which would have an
impact on membership of Petitioner No.1 Bank.
9. Mr. Gaware would further submit that provisions of Section

144-5A cannot have the effect on right to vote by retired members of
Petitioner No.1-Bank. That the concept of entitlement of a nominal
members to keep deposits is different than their inherent right to vote in
election as members of the bank. That it is the right of the Petitioner
No.1 Bank to decide as to whom to admit as its members and that SCEA
cannot take any decision in that regard. Mr. Gaware would therefore urge
that the general directives issued by the SCEA be set aside and that the
provisional voters list of Petitioner No.1-Bank be prepared by including
the names of even retired members. He would further urge that as and
when occasion arises for raising any objection to provisional list of voters,
8/27

all questions with regard to entitlement of members of Respondent No.1

Bank to vote be left open to be decided by the appropriate authority.
10. Mr. Patil-Bankar, the learned counsel appearing for State Co-
operative Election Officer would rely on the judgment delivered by a
Single Judge of this Court (Sandeep V. Marne, J.) in Laxman Dattatray
Jadhav and Ors. Vs. Taluka Co-Operative Election Officer and the
Assistant Registrar, Co-operative Societies, Parbhani and Ors, Writ
Petition No.11351 of 2022 decided on 22 November 2022. He would
submit that all issues involved in the present petition are squarely
covered by the judgment and that Petitioners’ petition therefore deserves
to be dismissed. Additionally he would submit that deletion of names
from provisional list of voters does not amount to removal of names of
members from membership register under Section 25A of the Act of
1960. That failure on the part of concerned Salary Earners Societies to
remove names of retired employees from register of regular members was
resulting in their participation in election process by casting votes in
elections despite specific prohibition under Section 27(8) of the Act of
1960 and that therefore the SCEA is required to step in and issue general
directives to ensure compliance of the provisions of Section 144-5A and
27(8) of the Act of 1960. He would however submit that since salary
earners’ credit cooperative societies can admit a retired employee as a
nominal member, SCEA has not issued any direction about membership
register of such societies. That the requisite action for classifying retired
9/27

employee of such societies will have to be taken by the Registrars.

However with a view to prevent such retired employees from voting in
elections, SCEA was required to issue general directives. Inviting our
attention towards Rule 6 of the Rules 2014, he would submit that what is
required to be prepared is ‘a provisional list of voters’ and therefore issue
of membership becomes wholly irrelevant. The directives issued by the
SCEA did not apply to register of membership but is restricted to voters
list under Rule 6. He would invite our attention towards the provisions
of Section 73CB of the Act of 1960 to contend that the SCEA is vested
with the jurisdiction inter alia to prepare the electoral roll and that
therefore the directives issued by the SCEA by communication dated 10
February 2023 are in tune with the statutory frame work. He would pray
for dismissal of the petition.
11. Intervention application No.7895 of 2023 is filed by Shri.

Nilesh Yadavrao Deshmukh & Ors. seeking intervention and vacation of
interim order passed in the present petition. Mr. Deore learned counsel
appearing for intervener has adopted submissions of Mr. Bankar.
12. Mr. Patel, the learned Addl. Government Pleader would also
oppose the petition and rely upon judgment in Laxman Dattatray Jadhav
in support of his contentions.
13. After attention of Mr. Gaware was drawn to the judgment in

Laxman Dattatray Jadhav, in rejoinder he would submit that the
10/27

judgment is not applicable to the present petition and that he would urge
additional points to convince this court to take a different view than the
one taken in Laxman Dattatray Jadhav. Mr. Gaware would submit that
the judgment in Laxman Dattatray Jadhav deals with elections of ‘salary
earners co-operative credit society’ whereas the Petitioner in the present
case is a ‘Co-operative Bank’. He would further submit that in Laxman
Dattatray Jadhav, the process of preparation of provisional voters list was
undertaken and after lodging of a complaint against such provisional list,
the Taluka Co-Operative Election Officer had passed an order directing
deletion of names of retired employees from provisional voters list. That
in the present case the process of preparation of provisional voters list of
Respondent No.1 Bank is yet to commence and that therefore there was
no occasion for the SCEA to precipitate the matter.
14. Rival contentions of the parties now fall for our

consideration.
15. It must be observed at the very outset that the issue of

jurisdiction of SCEA to direct deletion of names of retired employees of
salary earners’ credit cooperative societies from provisional list of voters
has been decided by this court in Laxman Dattatray Jadhav (supra). In
that case, it is held that the Election Officer possess jurisdiction to direct
such deletion. This court has further held that retired employee of a
salary earner’s co-operative credit society can only become a nominal
11/27

member of such society and does not have right to vote. Since the
judgment in Laxman Dattatraya Jadhav (supra) has a direct bearing on
the issues involved in the present petition, it would be apposite to
reproduce the relevant portion of the judgment as under:
2. The issue that has attracted the attention of this court is, whether an
employee can continue as member of Salary Earners' Credit Co-operative
Society and whether his name can be continued in voters list after his
retirement from service.
3. The issue arises on account of order dated 12.11.2022 passed by the
Taluka Co-operative Election Officer and the Assistant Registrar of Co-
operative Societies, Parbhani directing deletion of names of petitioners from
voters list on account of their retirements from service.
12. After having heard the learned counsel for the parties, it is clear that the
Society has been registered as a Salary Earners’ Credit Co-operative Society.
Therefore, ordinarily only a salary earning employee should remain as an
active member of the Society. Whether a retired employee can also remain as
an active member of the Society for the purpose of contesting elections and
voting, that is the issue involved in the present petition.
13. It would be necessary to first examine the Byelaws of the Society. Under
Byelaw D-1.1, only a permanent employee can be admitted as a member of
the Society. Admittedly, petitioners, having retired from service, are no longer
permanent employees of the establishment. Faced with this difficulty, Mr.
Suryawanshi has contended that Byelaw D-1.1 applies only for the purpose of
admission of an employee as a new member of the Society and that the same
would have no application to the issue of termination of membership. I am
unable to agree. If a person is not eligible to be admitted as a member of the
Society, upon loosing status as a permanent employee, he would acquire
ineligibility to continue as a member. If such a contention is accepted, a
permanently appointed employee admitted as a new member would continue
to hold membership even if he resigns from service. I am therefore of the view
that the requirement of being a permanent employee is applicable both for
admission of a new member as well as for continuing as an active member.
The contention therefore deserves summary rejection.
12/27

14. One must also bear in mind the objective behind establishment of a Salary
Earners’ Credit Co-operative Society, the objective being to extend credit
facilities to the employees in service. As rightly submitted by Mr. Kadam,
there is an inbuilt mechanism of recovery of installments / loans from the
salaries of the employees in service. After their retirement, since the Society
cannot recover its dues, no credit facilities can be extended to them. This is
one more reason why only a serving employee should ideally remain as an
active member of the Society.
15. Heavy reliance is placed by Mr. Suryawanshi on the previous proceedings
relating to removal of petitioners from the post of Director of the Society. It is
his case that the issue with regard to petitioners’ membership of the Society is
finally concluded by order dated 10.02.2020 passed by the Divisional Joint
Registrar. However, perusal of that order would indicate that the Divisional
Joint Registrar has not recorded any finding to the effect that petitioners
continued to remain as active members of the Society, despite their
retirements from service. The Divisional Joint Registrar has not examined the
provisions of Byelaws nor distinction between an active and a nominal
member. He was essentially determining validity of order of Assistant
Registrar removing Petitioners from Board of Directors. The order of the
Assistant Registrar is set aside on various counts including jurisdiction.
Therefore, order passed by the Divisional Joint Registrar cannot cited to
contend that the issue of entitlement of petitioners to continue as active
members of the society has either been decided or that it has attained finality
in any manner.
16. Now, I turn to the submission of Mr. Suryawanshi that the Election
Officer does not have jurisdiction to decide the issue of eligibility of
petitioners to continue as a members of the Society. In support of his
contentions, Mr. Suryawanshi has relied upon the above listed judgments. I
agree with this submission of Mr. Suryawanshi. However, perusal of the order
passed by the Election Officer would indicate that he has nowhere recorded a
finding that petitioners have ceased to be members of the Society. What is
held essentially is that they would now continue to be nominal members of
the Society after their retirement from service. This findings has been
recorded by referring to the provisions of Section 144-5A of the Act of 1960,
which reads thus:
“144-5A. Prohibition on accepting deposit from non- members.
Notwithstanding anything contained in any Act, a non-agricultural co-
operative credit society shall not accept deposit from any person who is
13/27

not its member. If any society which has accepted deposit from non-
members, before the date of commencement of the said Amendment
Act, 2017, it shall either enroll them as members or refund deposits of
all non-members within two years from commencement of the said
Amendment Act, 2017.
Provided that, the salary earners’ credit cooperative society may
accept deposits voluntarily from their members after their retirement
by enrolling them as nominal members.
Explanation.- For the purposes of this section, “member” does not
include nominal member.”
(emphasis supplied)
17. The concept of nominal membership is recognized under Section 24 of

the Act which reads thus:
“24. [Nominal and associate member]
(1) Notwithstanding anything contained in section 22, a society may
admit any person as a [nominal or associate member].
(2) A nominal member shall not be entitled to any share in any form
whatsoever in the profits or assets of the society as such member. A
nominal member shall ordinarily not have any of the privileges and
rights of a member, but such a member, or an associate member, may,
subject to the provisions of sub-section (8) of section 27, have such
privileges and rights and be subject to such liabilities of a member, as
may be specified in the by-laws of the society.”
18. The provision about entitlement of members to vote is dealt with under
Section 27, Sub Section 8 of reads thus:
“27. Voting powers of members
[(1) to (7) ......
(8) No nominal member shall have the right to vote [and no such
member shall be eligible to be a member of a committee or for
appointment as a representative of the society on any other society].’
14/27

(9) to (12) ......”
19. Thus the concept of nominal membership after retirement of an

employee is recognized by the Act. Thus objective behind registration of a
salary earners’ credit cooperative society together with the provision under
Section 144-5A of the Act on 1960, would indicate that an active member
can continue to remain in a capacity as a nominal member after his
retirement. In his capacity as a nominal member, he can make voluntary
deposits with a salary earners’ credit cooperative society. However under Sub
Section 8 of Section 27 of the Act of 1960, such a nominal member does not
enjoy the privilege of voting. The cumulative reading of the above provisions
would lead to an inescapable conclusion that after retirement of an employee,
he can continue only as a nominal member of a salary earners’ credit
cooperative society and he is not entitled to vote.
20. Even otherwise, considering the broad objective behind establishment of
a Salary Earners’ Credit Co-operative Society, in my view, accepting the
contentions of the petitioners would lead to an absurd situation where a
retired employee would indefinitely continue as member, contest elections
and occupy positions in the management committee. Since the Society will
not be in a position to extend any credit facilities to a retired employee,
continuation of his membership with the Society would be only for the
purpose of participation in the elections. This would completely defeat the
very objective behind establishment of the Society. A retired employee does
not earn any salary and cannot remain an active member of the Salary
Earners’ Credit Co-operative Society. The interpretation sought to be placed
by Petitioners which leads to absurdity will have to be avoided and the one
that subserves the objective behind establishment of such society needs to be
upheld. The Election Officer has therefore rightly held the petitioners to be
nominal members of the Society.
16. Thus, the issue involved in the present petition is covered by

the judgment of this court in Laxman Dattatray Jadhav. We could have
disposed of the present petition in the light of findings recorded in that
judgment. However Mr. Gaware has strenuously urged before us that the
15/27

judgment in Laxman Dattatray Jadhav is distinguishable and has it has no

application to the present case. He has also sought to advance certain
additional submissions, which, according to him, have not been taken
into consideration in that judgment. We therefore proceed to deal with
the submissions of Mr. Gaware.
17. It is contended by Mr. Gaware that in Laxman Dattatray

Jadhav, this court has dealt with a case of ‘salary earner’s co-operative
credit society’, whereas Petitioner No.1 is a ‘salary earners’ bank’. That
provisions of Section 144-5A of the Act of 1960 restricting retired
employees only as nominal members would be applicable only to a ‘ credit
society’ and that the same would have no application to a ‘bank’.
18. There is no denial to the fact that Petitioner is salary earners’

co-operative society. In this regard, following averments made by the
Petitioners in the petition would be relevant:
“The Petitioner no.1 is a bank duly registered as per the

provisions of Maharashtra Co-operative Societies Act, 1960 and
Rules, 1961.
The Petitioner No.1 Bank has salaried employees of state

government & Zilla Parishads, State government undertaking &
corporations as its members excluding police personnel and the
primary teachers.
The Petitioners state that the Petitioner No.1 Bank is having in-
service salaried employees as well as retired employees as its
members.”
16/27

19. Petitioners have also produced details of Petitioner No.1

Bank at Exhibit ‘A’ to the petition in which Petitioner No.1 Bank is
described as ‘salary earners’ co-operative bank’. Therefore merely because
Petitioner No.1 also happen to enjoy additional status as a ‘bank’, would
not erase its fundamental status as a society of salaried employees dealing
with disbursement of credit facilities and obtaining deposits from
employees. It also appears that Petitioner No. 1 was initially a ‘credit
society’, which subsequently received license to operate as a ‘bank’.
Therefore mere receipt of license to operate as a bank would not alter
status of Petitioner No. 1 as a cooperative society, nor can it escape
application of Chapter XI-A of the Act of 1960 governing ‘Non
Agricultural Cooperative Credit Societies’.
20. We consider the statutory framework regulating right of a

retired employee, who is a member of a salary earner’s co-operative credit
society, to vote in elections of that society. Chapter XI-1A of the Act of
1960 deals with ‘Non Agricultural Cooperative Credit Societies’.
Relevant provisions of Chapter XI-A are:
144-2A. (1) Unless the cont ext otherwise requires, this Chapter shall apply
to the non-agricultural co-operative credit societies.
(2) The provisions of this Chapter shall be, in addition to and not, save as
hereinafter provided, in derogation of the provisions of this Act or any other
law for the time being in force.
17/27

144-3A. In this Chapter, unless the context otherwise requires,–

(a) “non-agricultural co-operative credit society” means a society, the primary
object of which is to provide credit to its members and accept deposits from
members and includes,—
(i) an urban credit co-operative society ;
(ii) a rural non-agricultural credit co-operative society ;
(iii) a salary earners’ credit co-operative society ; and
(iv) any other society or class of societies, which the State Government
may, by general or special order published in the Official Gazette, from
time to time, specify in this behalf ;
(b) “the Maharashtra State Non-agricultural Co-operative Credit Societies
Regulatory Board” or “the Regulatory Board” means the Board constituted
under section 144-13A ;
(c) “Stabilization and Liquidity Support Fund” means the Stabilization and
Liquidity Support Fund created under section 144-25A.
“144-5A. Prohibition on accepting deposit from non- members.
Notwithstanding anything contained in any Act, a non-agricultural co-

operative credit society shall not accept deposit from any person who is not its
member. If any society which has accepted deposit from non- members,
before the date of commencement of the said Amendment Act, 2017, it shall
either enroll them as members or refund deposits of all non-members within
two years from commencement of the said Amendment Act, 2017.
Provided that, the salary earners’ credit cooperative society may accept
deposits voluntarily from their members after their retirement by enrolling
them as nominal members.
Explanation.- For the purposes of this section, “member” does not include
nominal member.”
(emphasis supplied)
18/27

21. Chapter III of the Act of 1960 deals with Members and their
rights and liabilities. Section 27 deals with voting powers of members and
reads thus:
“27. Voting powers of members

[(1) to (7) ......
(8) No nominal member shall have the right to vote [and no such member
shall be eligible to be a member of a committee or for appointment as a
representative of the society on any other society].’
(9) to (12) ......”
22. Thus the statutory scheme relating to rights of retired

employees in their capacity as members of salary earners’ cooperative
credit societies is as under:
i) Under Section 144-5A of Act of 1960, a salary earners’ co-

operative credit society can accept deposits from its members after
their retirement by enrolling them as nominal members. Thus, a
retired employee of a salary earners co-operative credit society can
only be enrolled as a nominal member.
ii) Under Sub-Section 8 of Section 27 of the Act of 1960,
such a nominal member does not have a right to vote.
23. Thus, as per the combined effect of the provisions of Section

144-5A and Section 27(8) of the Act of 1960 a retired employee can
enrolled by salary earner’s co-operative credit society only as a nominal
member, who does not have right to vote. Since a nominal member does
not have right to vote, his /her name cannot be included in the voters list
19/27

prepared for holding elections of such societies. This statutory scheme

has been considered and interpreted by this court in case of Laxman
Dattatray Jadhav.
24. Mr. Gaware has contended that the impugned

communication dated 10 February 2023 would have the effect of
removal of names of retired employees from the membership register of
Petitioner No.1 Society. Relying on provisions of Section 25A of the Act
of 1960, it is contended that only the Registrar has power to remove
names of members from the membership register. Section 25A reads
thus:
“25-A. Removal of names of members from Membership registers—
The committee of a society shall remove from the register of its

members the name of a person who has ceased to be a member or who
stands disqualified by or under the provisions of this Act for being the
member or continuing to be the member of a society:
Provided that, if the society does not comply with the
requirement of this section, the Registrar shall direct such society to
remove the name of such person, and the society shall be bound to
comply with such direction.”
25. However what is done by the SCEA in the present case is not
removal of any member from register of membership of any society.
Removal of name of a member from membership register of a society is
an altogether different concept than deletion of names from voters list.
As a matter of fact, considering the provisions of Section 144-5A of Act
20/27

of 1990, retired employees can only remain as nominal members. Their

names therefore are therefore required to be segregated from other
members and entered separately in the register. However in the instant
case, it appears that Petitioner No.1 Bank framed Bylaws, under which
retired employees can continue as members of the society. Whether the
Bylaws of Petitioner No.1 Bank are in tune with the provisions of Section
144-5A of the Act is an altogther different aspect, which can be
determined in appropriate proceedings. We have not been called upon to
answer the said issue. The limited issue involved in the present petition is
whether a retired employee, who can be enrolled merely as a nominal
member and who does not have right to vote, can find place in voters list
prepared for conducting elections of the society. Since such nominal
member does not have right to vote, inclusion of his / her name in voters
list becomes an exercise in futility. Therefore no fault can be found in the
impugned communication of the SCEA in directing deletion of names of
retired employees from voters list of salary earner’s co-operative credit
societies.
26. Mr. Gaware has contended that there is detailed mechanism

provided for preparation of provisional list of voters under Rule 6 and 8
of the Rules of 2014 and that issuance of the impugned directives by
SCEA at this juncture is premature. Rules 6 and 8 read thus:
6. Provisional list of voters for co-operative societies having individuals as

members :— (1) A provisional list of voters shall be prepared by every
society in the year in which the election of such society is due to be held.
21/27

The member who has completed minimum two years as member from the
date of his enrolment and who is an active member shall be included in the
provisional list as laid down in sections 26 and 27 of the Act. If different
constituencies are provided in the bye-laws, the names of voters shall be
arranged constituency wise, if required, as laid down in the bye-laws.
(2)
(3)
(4)
(5)
8. Claims and objections to the provisional list of voters and the final list of
voters for cooperative societies having individuals as members.—(1)
When the provisional list of voters is published for inviting claims and
objections, any omission or error in respect of name or address or other
particulars in the list may be brought to the notice of the concerned
District Co-operative Election officer or Taluka or Ward Co-operative
Election Officer in writing by any member of the society during office
hours within ten days from the date of publication of the provisional list of
voters.
(2) Every claim or objection shall be in writing and state the grounds on
which the claim is based or the objection is raised, as the case may be.
(3) The District Co-operative Election Officer or Taluka or Ward Co-
operative Election Officer shall, or as directed by the SCEA, after making
such enquiries as deem necessary in this behalf, consider each claim or
objection, and give his decision thereon in writing to the persons
concerned within ten days from the last date prescribed for receiving the
claims and objections. Thereafter final voters list should be published
within the period of fifteen days from the last date prescribed for receiving
the claims and objections. The list finalized by the election officer after
deciding all claims and objection shall be final list of voters.
(4) The copies of the final list of voters shall be displayed on the notice
board of the District Co-operative Election Officer and also on the notice
board of the society at least ten days before the declaration of the election
programme and in no case later than fifteen days from the finalization of
22/27

claims and objections. The District Co-operative Election Officer may also
cause it to be published on the official website of the SCEA, if any.
27. The submission of Mr. Gaware is premised on availability of

remedies under Rule 8 of Rules of 2014 to the aggrieved persons to any
entry in the provisional list of voters. It is his contention that in view of
availability of remedies under the Rules of 2014 for deletion of names of
ineligible voters, SCEA could not have issued an omnibus directive. The
argument may appear to be attractive in the first lush, however the same
is completely misplaced. What Mr. Gaware expects is that SCEA should
allow the Taluka and District Co-operative Election Officers to prepare
provisional list of voters, which may include names of even nominal
members without a right to vote, and only upon raising of an objection,
the process of deletion of their names can be undertaken. In short, if no
objection is raised, retired employees in their capacity as nominal
members, would vote in elections. This would be contrary to the
statutory scheme. We find that the SCEA has taken a prompt step in
issuing advance directives to all the Taluka and District Co-operative
Election Officers to ensure that names of retired employees, who have no
right to vote, should not be included in the provisional list of voters. This
would obviate any error being committed in conducting elections of
salary earners’ co-operative credit societies. The directives of SCEA, in
our view, would not only ensure compliance with statutory provisions,
but would also reduce litigations. Since the directives issued by the SCEA
23/27

are found to be compliant to statutory framework of the Act of 1960 and

Rules 2014, we are of the view that said directives would not, in any
manner, affect the procedure prescribed for preparation of provisional list
of voters under Rules 6 and 8 of Rules of 2014. The objection therefore
deserves to be repelled.
28. Under Section 73CB of the Act of 1960, the SCEA is

responsible inter alia for superintendence, direction and control of
preparation of electoral rolls and conduct of elections of societies.
Section 73-CB (1) reads thus:
73CB. (1) The superintendence, direction and control of the preparation of

the electoral rolls for, and the conduct of, all elections to a society shall vest in
the authority called as ‘the State Co-operative Election Authority’, as may be
constituted by the State Government in that behalf. Every general election of
the members of the committee and election of the office-bearers of a society
including any casual vacancy, to the extent applicable, shall be held as per the
procedure prescribed.
29. Thus SCEA is vested with jurisdiction of superintendence,

direction and control of preparation of electoral rolls. It therefore
possesses the necessary jurisdiction to issue directives to the District
Cooperative Election Officers to ensure that the provisional and final list
of voters are prepared as per the statutory framework. We have already
held that directions for deletion of names of retired employees from
provisional list of voters does not touch upon the issue of continuance of
such employees as members of the salary earners’ cooperative credit
24/27

society. Therefore the objection of jurisdiction raised by Petitioner

deserves rejection.
30. Salary earners’ co-operative credit societies are formed and

registered with the objective of providing credit facilities to salary earning
employees of chosen establishments. They cater to the needs of
employees of government and semi-government establishments. There
are various restrictions imposed under Chapter XI-1A of the Act of 1960
on operations of non-agricultural credit societies such as advancement of
loans, prohibition on trading, holding of properties, maintenance of cash
reserves, maintenance of statutory liquidity ratio, etc. A provision has
been made under Section 144-5A of the Act which prohibits acceptance
of deposits from non-members by non-agricultural credit cooperative
societies . However an exception has been carved out under Proviso to
Section 144-5A, under which a salary earners’ cooperative credit society
is permitted to accept deposits from retired employees, subject to a
restriction that they can be enrolled only as nominal members. Thus
merely because retired employees are extended a special concession of
making deposits in a salary earners’ cooperative credit societies, it does
not mean that they can participate in election process by voting or
holding posts in managing committees of such societies.
31. The objective behind putting restrictions on rights of retired

employees of salary earners’ cooperative credit societies is to ensure that
25/27

the society is managed by salary earners and not by retired employees.

After all it is a ‘salary earners society’ and one who no longer earns salary
is not permitted under the Act to manage it. Also, with passage of time,
there is possibility of number of retired employees exceeding the serving
ones, thereby resulting in a situation where retired employees may take
over the management of the society. We however need not delve any
further into the aspect of legislative intent behind statutory provisions in
the Act of 1960, as the same are not under challenge before us. Suffice it
to hold that the impugned directives issued by the SCEA are in tune with
the statutory provisions and are therefore validly issued.
32. Interim Order was passed by this Court in the present

Petition staying the impugned directives on 9 May 2023 on the basis of
submission made on behalf of Petitioners that SCEA does not have
jurisdiction to order deletion of members of a society. We have already
held that the impugned directives does not have the effect of deletion of
retired employees from membership register. Election of these societies
have already been held up for a long time inter alia due to pandemic
restrictions. SCEA had issued directives to prepare the provisional lists of
voters of all such societies by 1 February and to finalise the elections by
30 June 2023. It is therefore necessary to vacate the interim order so that
elections can take place in an expeditious manner.
26/27

33. Resultantly, we do not find any merit in the present petition.

Writ Petition is accordingly dismissed with no order as to costs. Interim
Order stands vacated. With dismissal of the Petition noting survives in
the IA, which is also disposed of. Rule is discharged.
SANDEEP V. MARNE, J. DHIRAJ SINGH THAKUR, J.
27/27

Ordjud

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Ordjud

Uploaded by

Copyright:

Available Formats

2023:BHC-AS:17453-DB

kishor 1/27 wp 6199 of 2023 as.doc

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

1. Nashik Zilla Sarkari & Parishad

2. Mahesh Daguju Avhad

3. Ramesh Kachru Rakh

4. Nivrutti Deoram Sanap

5. Subhash Trimbak Pawar

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

1. The State of Maharashtra

2. The State Co-operative Election Authority

3. The District Election Officer &

4. The Election Branch Chief &

5. Commissioner for Co-operation &

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

Mr. A. I. Patel, Addl AGP a/w. N. K. Rajpurohit, AGP for State.

CORAM: DHIRAJ SINGH THAKUR &

DATE : 21 JUNE 2023.

JUDGMENT : (Per – Sandeep V. Marne, J.):

Rule. Rule is made returnable forthwith. With the consent of

2. Petitioners before us are Nashik Zilla Sarkari and Parishad

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

3. Petitioner No.1 is a Society registered under the provisions of

4. The last elections of Petitioner No.1 Bank were held on 18

5. On 10 February 2023, SCEA issued impugned

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

are aggrieved by impugned communication dated 10 February 2023 and

6. The Petition was moved before vacation court on 9 th May

1. Issue notice to the respondents, returnable on 12th June 2023.

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

7. While seeking interim relief on 9 May 2023, Petitioners

Challenge raised by the petitioner, which is a Society registered under

2) Issue notice, returnable in two weeks.

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

4) In the meanwhile, no further steps be taken by the respondent no.1

8. Appearing for Petitioners, Mr. Nitin Gaware the learned

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

9. Mr. Gaware would further submit that provisions of Section

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

all questions with regard to entitlement of members of Respondent No.1

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

employee of such societies will have to be taken by the Registrars.

11. Intervention application No.7895 of 2023 is filed by Shri.

13. After attention of Mr. Gaware was drawn to the judgment in

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

14. Rival contentions of the parties now fall for our

15. It must be observed at the very outset that the issue of

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

17. The concept of nominal membership is recognized under Section 24 of

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

(9) to (12) ......”

19. Thus the concept of nominal membership after retirement of an

16. Thus, the issue involved in the present petition is covered by

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

judgment in Laxman Dattatray Jadhav is distinguishable and has it has no

17. It is contended by Mr. Gaware that in Laxman Dattatray

18. There is no denial to the fact that Petitioner is salary earners’

“The Petitioner no.1 is a bank duly registered as per the

The Petitioner No.1 Bank has salaried employees of state

::: Uploaded on - 28/06/2023 ::: Downloaded on - 28/06/2023 18:22:08 :::

19. Petitioners have also produced details of Petitioner No.1