ORDER
1. I have before me a clutch of writ petitions numbering about a dozen but the point to note is all of them have for their target a notification of the State of Karnataka purported to have been issued in exercise of the powers conferred under Section 121 of the Co-operative Societies Act, 1959 (hereinafter referred to as 'the Act'). Government having taken power under the aforesaid section proceeded to exempt a large number of individual members of co-operative societies as also the societies themselves from the operation of sub-clauses (a-1) and (b)(iv) of sub-section (2) of Section 20 of the Act stating further that the exemption, so ordered, shall remain in force up to and inclusive of 30thDecember, 1991 and upon its expiry the provisions of the said section shall stand revived. I must mention the said order is dated the 23rd September, 1990. Earlier to the passing of the order afresh Government had passed two other orders one on the first occasion i.e. on 28th May, 1990 and another on the second occasion i.e. on 22-7-1991 both of which carried the same directive as found in the order dated 23rd September, 1991, the only difference being that the two earlier orders referred to above limited themselves to Agricultural Credit Co-operative Societies and Primary Agriculture and Rural Development Banks whereas the last of the notifications dated 23rd September, 1991 is a proclamation of further amnesty with particular reference to individual members of a co-operative society. The three notifications appear very innocuous in nature issued in a routine fashion but the petitioners claim that they have a far-reaching effect and could lead to a total degeneration in the quality of Administrators ushered-in to occupy pivotal positions in a co-operative society through elections that were already in the offing. Some of the far-sighted members and directors of the societies becoming restive, and realising that there was every likelihood of societies being swamped and over-run by people who had defaulted in the payment of their dues which the Act treats as a cardinal sin, have come up with these writ petitions challenging the validity and correctness of the three notifications and praying for quashing them, holding them to be ultra vires of the powers of the Government, ultra vires of the Constitution of India as made without taking into account the fall-out from the game-plan they had adopted. The petitioner, therefore, say if not for anything else at least on the ground that the Government has failed to apply its mind to the need for taking power from an abundant source like Section 121 of the Act, for issuing notifications to suspend the operation of Section 20 of the Act should be quashed and rendered ineffective.
2. The facts mentioned supra hold good for all the writ petitions but, however, for the purpose of convenience I would in the course of this judgment refer to the facts enumerated in W.P. No.27979 of 1991. The petitioner herein is one of the Directors of the Karnataka State Co-operative Agriculture and Rural Development Bank. He has taken up cudgels against the impugned notifications because, he says, he is anxious to ensure that only qualified persons will vote and contest the elections to usher-in the new committee of management of the bank in question. He wants to make sure that persons who had defaulted in payment of their dues are not allowed to either vote in or contest the elections. He points out, notwithstanding the bar imposed by Sec. 20 of the Act, 90% of the Taluk level bank, who had defaulted in making the payments due from them and therefore ineligible to either vote in or contest the elections would now be free to do both, in virtue of the suspension of the operation of Sec. 20 under the impugned notification. This, according to the petitioner, is a case of misguided sympathy or if it was not that, it is a case of undue anxiety to pack these positions of power with the votaries of the Government in power. He, therefore, says that this was clearly a case of Government conferring a largesse on people who were not merely undeserving but were thoroughly unqualified to receive the benefaction showered on them by the unmerited though magnamonious act of Government in suspending the operation of Sec. 20 of the Act.
The last ground of attack against the impugned notifications is based on Art. 14 of the Constitution. The petitioner claims that the impugned notifications offend Article 14 of the Constitution being instances of arbitrary and capricious exercise of power. It is urged that Government cannot by a stroke of the pen, without due application of mind to the facts and circumstances of the case, extend a benefit to all and sundry although the statute itself confines exercise of that power in that behalf within certain limits. It is pointed out if the grass-root banks themselves were ineligible to vote and contest the elections their nominees could not profess to act on their behalf as it would then make the entire exercise a mockery in the eye of law, for reasons mentioned as aforesaid the petitioner asks that exercise of omnipotent power by Government under Sec. 121 be struck down.
3. The chief contestant in these writ petitions is the State. Appearing through the Learned Advocate General it has produced a statement of objections wherein apart from pointing out that the crusade against the notifications is a waste of fuselage because a similar notification had been upheld by the Supreme Court. Not only that, it is said even this Court has affirmed the constitutional validity of the aforesaid section. Then it goes on to justify the impugned notifications urging inter alia the facts and circumstances under which the said notifications came to be made. It is averred that somewhere in the year 1990 the Government of India came up with a scheme to wipe out rural indebtedness. The salient features of that programme was that individual members who had borrowed small sums not exceed, Rs. 10,000/- subject to certain other conditions and requirements would be exempt from repaying the said loan, with the Government of India agreeing to bear 50% of the debt provided the respective State Governments agreed to make themselves responsible for the other moiety. The Government of India also called upon such of those States concurring with the scheme as aforesaid to draw up a similar scheme so that the laudable motive of relieving rural indebtedness could be brought to furitition. This feeler by the Government of India to the State Governments asking them to formulate a scheme on the foregoing lines raised the hopes of the poverty-stricken rural debtors who thought that massive dosage of financial assistance being round the corner pouring in through the twin inlets of the Centre and the State, it would be just a matter of time before all their debts stood wiped out completely by the generosity of the Central and State Governments, the upshot however was that individual members of the societies and the gross-root level co-operative banks became slack in repayment of loans so much so most of the individual members and most of these banks became in no time defaulters under the Act. The immediate fall-out was, the indebted grass-root level banks were by the operation of Section 20 of the Act rendered ineligible overnight to send their representatives to the lead banks and as a result the lead banks who depend on these representatives for forming their committees of management would find themselves placed in a piquant situation without the services of these representatives. Both alarmed and distraught by this state of affairs, Government felt that it had no option except embarking upon a massive programme of resurrecting the overwhelming number of defaulters both human and institutional so that they could go to the conclave of the higher echelons of the Co-operative Societies to vote and contest for places in the management of the primary banks. The only way of ushering in the above transformation was to remove the ban imposed by the Legislature under Section 20 of the Act and only to achieve that end, the State maintains, the Government had resorted to drawing power from Section 121 to remove the blanket ban under Section 20 vis a vis a defaulter in order to pass the impugned notifications. It is contended that Government had no other purpose in mind and much less any sinister design or desire to make the institutions and individual members their own tools pliable at their will and pleasure. The Government, therefore, asks the notifications be saved and the writ petitions dismissed.
4. But at the time of hearing arguments I found the learned Advocate General in some kind of quandary in sustaining the notifications at least on one aspect which completely coursed outside the four corners of Sec. 121 of the Act, I am referring to the exemption of individuals from the operation of Section 20 of the Act. When confronted by this lacunae in the notifications, the learned Advocate General came out with an adroit reply saying that in none of these writ petitions the tenability of exempting individuals from the purview of Sec. 20 of the Act being at issue, even if it is held that the impugned notifications are vitiated for the aforesaid reason, the notifications would since be valid so far as institutions are concerned. I shall revert back to this argument a little later and in the meanwhile go on to set out the relevant provisions of the Act which have a bearing on the questions at issue.
5. The omnibus power to regulate the working of Co-operative Societies by exempting them from any of the provisions of the Act obtains under the very wide and almost dimensionless powers under Section 121. It reads:
'Power to exempt societies :--
The State Government may, by general or special order published in the Official Gazette, exempt any co-operative society or any class of societies from any of the provisions of this Act or may direct that such provisions shall apply to such society or class of societies with such modifications as may be specified in the order.'
Admittedly and in view of the foregoing provision Government has passed the orders impugned in these writ petitions and I might as well set out the latest of the orders passed by the Government picking out the roll model from W.P. No. 24233/91, which exempts not merely all societies but even individual members from the purview of Sec. 20 of the Act. It reads:
'In exercise of the powers conferred (by) Sec. 121 of the Karnataka Co-operative Societies Act, 1959 (Karnataka Act 11 of 1949) the Government of Karnataka hereby exempts the individual members of a cooperative society and Co-operative Societies from the operation of sub-clauses (a-i) and (b)(iv) of sub-sec. (2) of Sec. 20 of the said Act, in so far as the Annual General Meetings for the Co-operative years 1987-88, 88-89, 89-90 and 90-91 along with elections if any to be held as per Notification No. CMW 327 CLM 91 dated 20th September, 1992.'
The order purports to grant some kind of amnesty to individual members and institutions, under the Act, purporting to shield them from the operation of Sec. 20. It would, therefore, be appropriate to reproduce Sec. 20 with all its ramifications:
'20. Votes of members:--
(1) No member of a society shall have more than one vote in the affairs of the co-operative society:
.....
.....
.....
(2) The following shall not have the right to vote at a meeting of the co-operative society in which they are members, namely:--
(a) .....
(a-i) an individual member who is a defaulter.
(a-ii) .....
(b) a co-operative society-
(i) to (iii) .....
(iv) whose principal object is to advance loans and whose percentage of recovery is less than fifty per cent of the total demand for the co-operative year immediately preceding the co-operative year during which the meeting is held and which has failed to pass on to the financing bank or credit agency, as the case may be, to which it is indebted, the entire principal amount recovered with interest due thereon, not later than fifteen days of the close of the said co-operative year;
Explanation:-- A member shall be deemed to be a defaulter if he has failed to pay the arrears of any kind due by him to the society as borrower at least fifteen days before the date of such meeting after a notice of not less than fifteen days in this behalf has been issued to him.'
Sec. 19 of the Act is also of relevance. It states that 'no member of a co-operative society shall exercise the rights of a member unless he has made such payment to the society in respect of membership or has acquired such interest in the society, as may be specified in the bye-laws.'
6. The position obtaining under Sec. 20, therefore, is that an individual member is eligible for voting if he is not a defaulter within the meaning of the explanation to Sec. 20 referred to earlier. Where a society itself is a member of another society theformer is entitled to vote in the election of the latter but is precluded from participating in such election if. rendered ineligible under clause (iv) of sub-sec. (2) of Sec. 20. Similarly an agricultural credit society which is a member of a District Central Co-operative Bank would ordinarily enjoy the right of franchise would be precluded from asserting that right if the agricultural credit society raises loans from other financial institutions for the benefit of its members without the permission of the Registrar. The notifications impugned herein purport to grant immunity to all the members and the Societies as well from the operation of Sec. 20 of the Act referred to supra. I have earlier excerpted the notification dated 23rd September, 1991 supra since that notification appears to have superceded the previous ones and as can be seen from the said notification it remains in force till the end of 30th December, 1991. This Court having stayed the operation of all the notifications, they have all become inoperative both in law and in fact. The deadline set by the notification dated 23rd September, 1991 having long since expired these petitions could even be dismissed on the simple ground that they do not survive any longer since the notifications impugned in these writ petitions have by now become a bundle of damp squibs. But the petitioners fear that unless the tenability of these orders are subjected judicial scrutiny and tested on the Courts anvil to simply leave them alone would be placing temptation in the way of Government who would unhesitatingly take further opportunities to indulge in this kind of sabre rattling, firmly ensconced in the belief that the fountain source of power under Section 121 was perennial and hence nothing else mattered. It is mainly because of the apprehension that the orders impugned if allowed to be dormant, would serve as a further invitation to Government to produce a rash of similar orders in order to plague the Co-operative Societies by restricting their right of self-governance. I have to proceed to dispose of these writ petitions on merits and with that end in view I formulate the following brace of points as arising for consideration herein;
(i) Is Section 121 of the Act Constitutionally invalid?
(ii) If the section is valid, are the notifications issued by the Government referred to supra tenable in law?
7. In most of these cases Barrister Vasudeva Reddy addressed the leading argument on behalf of the petitioners but on one or two aspects the refrain was taken up by Mr. Veerabhadrappa who appeared for the petitioners in one of the connected cases. The respondent State was led by the learned Advocate General and in some cases he was joined by Sri, Jayakumar. S. Patil who tried to give a different slant to the entire thing but had soon to give up his foray into this jamboree.
8. Point No. 1:
Adverting now to point No. 1 the same is no longer res integra covered as it is by the decision of Supreme Court in Registrar, Coop. Societies v. K. Kunjambu, : [1980]2SCR260 . That was a case which arose under the Madras Co-operative Societies Act. The question that arose for consideration therein was whether Sec. 60 of the Madras Co-operative Societies Act was valid or not. The said section has been excerpted in the judgment of Supreme Court. It is wholly in pari materia with Sec. 121 of the Act. Section 121 of the Act is nothing but a reproduction of Section 60 of the Madras Act. Speaking for the Court, therein His Lordship Chinnappa Reddy, as he then was, held:
'Sec. 60 is not void on the ground of excessive delegation of legislative power. The power given to the Government under Sec. 60 of the Act is to be exercised so as to advance the policy and objects of the Act, according to the guidelines as may be gleaned from the preamble and other provisions are clear.'
Long years ago a Bench of the Mysore High Court had in Venkata Naidu v. B.C.C. Stores, 1967 (2) Mys LJ 256 : (AIR 1967 Mys 203) not merely upheld Sec. 121 of the Act but had also repelled the challenge to its constitutional validity. In the light of the two decisions referred to supra, one of Supreme Court and the other by the precursor of this Court, thereis hardly any room for any one to contend that Section 121 of the Act is constitutionally invalid. But as their Lordships have pointed out, where power is undoubtedly there, the question that looms large in such cases is whether that power has been exercised in a manner sub-serving the object of the Act. The test is to identify the benefactions if any that would result from such exercise of power. I would deal with this aspect of the matter while I consider point No. 2. On point No. 1 it has got to be held that Section 121 constitutionally valid and I therefore answer the same in the affirmative.
9. Point No. 2:--
The only point which, now remains to be considered is of the validity of the spate of Government Orders taking power under Section 121 for granting exemption to individuals and societies alike from the operation of Section 20 of the Act. To start with I must recall the argument led on behalf of the petitioners suggesting that Section 121 is limited to only (a) Co-operative Societies and (b) a certain class of societies. According to the petitioners it does not take within its ambit individual members of co-operative societies. I have excerpted Section 121 of the Act hereinbefore. A simple reading of the said section shows the conspicuous absence of power to grant a reprieve to individual members of a society under Sec. 20 of the Act but even so in these cases the State had simply rushed-in and made a blanket order covering both individuals and institutions as could be seen from the latest of the notifications dated 23rd September, 1990 produced at Annexure C. In the earlier notifications individual members were not included, the notifications limiting their rescue act only to institutions viz. agricultural co-operative societies. Possibly if the Government had stopped with that and had come out with some justification for passing such an order then probably there would have been little or no difficulty at all in sustaining such executive action. But, it seems to me, they queered the pitch by extending the protective umbrella by taking power under Section 121 to cover individual members extending to them a part of the beneficial treatment. This is the first mistake the Government has indeed committed and for that reason alone the latest of the Government Orders under Section 121 should necessarily fail.
10. But, then the learned Advocate-General turned round and argued that while that part of the G.O. referrable to individual members may be bad, none of the petitioners being sitting Directors of any Agricultural Co-operative Societies and not having been affected by that blatantly indefensible order, it was not necessary to interfere with the same and that I may even ignore it.
11. I am afraid I cannot countenance that argument at all. All said and done, the order is an integrated one albeit separable but I do not think that I should ignore that piece of the Government's fiat which the learned Advocate-General has realises to be totally indefensible and has got to go, whether or not the petitioners stand to gain or loose anything from the same. I must make it clear that it is not a question of somebody gaining something or losing something. To ask me not to sheer a portion of the order which is illegal because it mattered little to those who are before me in these writ petitions is not the way one should consider the problem on hand at all. Without more, the exemption granted to individual members must necessarily go; because Section 121 of the Act in specific terms applies to and is available for application to (a) a particular society and (b) to a class of societies but not to individual members. The individual members not being ensconced within the four corners of Section 121 of the Act the exemption granted to them under the impugned notification at Annexure C is clearly ultra vires of the powers of Government under Section 121.
12. We now go over to the other part of the order which concerns the societies. According to counsel for the petitioners the G.O. being afflicted by a cancerous growth and the Court having sheared a part of it should not stop at shearing off the rest. According to learned Advocate-General the crucial step of taking away the society from the orbit of Section 20 was undertaken because of thealarming situation resulting in very few voters who could participate and contest the elections to be held to constitute the apex society or the apex banks from which the grass-root level societies and banks drew their life-breath. I have earlier excerpted portion of the objection statement reflecting the above process and very shortly I shall show that the same was perhaps nowhere in the mind of the Government when they passed these orders. I would like to take this opportunity of pointing out to Government that in regard to Government orders which are publicly made, Government cannot seize a later occasion either to add, mend, detract or clarify such orders. In other words the order must stand as it is and cannot be explained at a later date even if the explanation be in regard to the reasons that activated the Government to pass those orders. This aspect of the matter is well settled by the decision of the Supreme Court in Commr. of Police v. Gordwandas, : [1952]1SCR135 . Their Lordships while dealing with an explanation subsequently offered by Government in defence of one of its Orders which was under attack, held at page 18:
'Public orders, publicly made, in exercise of a statutory authority cannot be considered in the light of explanations subsequently given by the officer making the order of what he meant, or of what was in the mind or what he intended to do. Public orders made by public authorities are meant to have public effect and are intended to affect the actings and conduct of those to whom they are addressed and must be construed objectively with reference to the language used in the order itself.'
If this be the yardstick to be adopted and should be the guidelines to assist me in assessing the stand of Government, I would at once say it is not open to Government as of now to supply any explanation as to why those orders were passed so long as the orders themselves remained totally mute regards the cause therefor and if Government now states that they were constrained to pass the orders for the reasons mentioned in the statement of objections, it would be a travesty of justice for a Court to accept such an explanation offered subsequently in defence of the orders impugned before it, when the orders themselves did not reveal or disclose any reason, legally speaking the explanation offered at the hearing of these writ petitions in defence of the aforesaid orders has necessarily to be discarded as a mere afterthought.
13. It becomes thus clear that it is not even necessary to refer to such a plea, and muchless could such a plea be put forth in defence of the impugned order. But then, even the defence put forth does not appear to be tenable either. It may be recalled that the stand taken by the State is, with the unfurling of a plan by the Centre for a massive wipe off debts owed by farmers, somewhere in the year 1990, individuals and institutions became slack in the repayment of their loans which in turn led to these institutions becoming sick units with most of them becoming ineligible to exercise their franchise at the elections to send their members to the lead banks, it was, therefore, thought necessary to pass the impugned orders so that representatives of the grass-root level banks and societies could be elected and sent to the lead banks. I am hard-put to appreciate this stand. The Government of India scheme and the scheme of the State Government covered only individual members who were agriculturists with the immediate object of the scheme being only to relieve such persons of their indebtedness up to a limit of Rs. 10,000/- only. The scheme also postulates a number of conditions before any debt servicing could be undertaken. Amongst other things it denies the benefit of the scheme to a chronic defaulter as spelled out by the scheme. Such debt servicing being clearly limited to individuals, therefore institutional borrowers were totally outside the purview of the aforesaid scheme. In these writ petitions we are concerned with institutional borrowers who had lagged behind in repayments. Therefore, why the institutions should have slackened in the performance of their duties in the wake of the promulgation of the Government of India Scheme that specifically catered to individual borrowers is something which the State has not been able to explain and the learned Advocate-General was notable to support himself by any suitable explanation as to why the institutions should commit a default in the wake of a scheme enacted to provide redress to small agricultural borrowers, What is more even before the cut-off date, I take it there was a cut-off date which mattered, if these institutions had become sick as contemplated by clause (2) of Section 20 there is little point in making a fetish of a defence resting purely on the intended benevolence under the Government of India order. It seems to me there is probably no correlation between the scheme for waiving recovering of loans from individual borrowers and the impugned orders that exempt individuals and institutions alike from the operation of Section 20 of the Act. I am satisfied if at all there was any drainable scheme behind these orders it must be something other than what the State has been Idling us so far and at any rate to me it has remained without being fathomed.
14. Be that as it may, even so orders on such absolute lines covering each and every society either sick or otherwise could not have been passed. As already pointed out any operation involved in granting of exemptions by taking power under Sec. 121, could not cover individual members and notwithstanding the same the orders impugned herein covering as they do individual members also, that part of the impugned order which relates to granting exemption under Section 121 to individual members is totally indefensible is what 1 have already held.
15. I must now add the final epitaph over these orders by pointing out that the State had no reason, muchless any good reason for passing the orders impugned herein. The Government Orders as they now stand have rendered themselves wholly unsupportable ex facie. To emphasise this aspect I shall reproduce again Section 121 of the Act, which reads:
'121. Power to exempt societies: --
The Stale Government may, by general or special order published in the Official Gazette, exempt any co-operative society or any class of societies from any of the provisions of this Act or may direct that such provisions shall apply to such society or class of societies with such modifications as may be specified in the orders.'
The section which I have reproduced as aforesaid militates against any endeavour that can be made at sustaining the impugned G.Os. The. section does not provide for mothballing societies by passing a blanket order under Sec. 121 making all and sundry eligible for all types of exemption under the Act. The section it may be noted provides only for selective operation by choosing for its attention 'any co-operative society or any class of societies'. As pointed out earlier the notification dated 23rd September, 1991 is very wide spread covering all societies ignoring the criterian that remedial action under Sec. 121 can only be done on a selective basis. The State has sought to justify the need to extend such absolute cover to all societies by making the following statement in para 4 of its objection statement:
'According to Section 28A of the Act, the elections to the Committee of Management to a Co-operative Society should be held. The situation has arisen wherein majority of the members of a co-operative society cannot participate in the election. The majority of members have become defaulters not on their own but because of Government Policies, There will be no election at all in majority of cases if the impugned Government Order is not in existence since there are no members left to elect their representatives. The too rigorous application of Sec. 20 itself result in frustrating the objects of the Act instead of advancing them. The Government has issued Order dated 23-9-1991 to relax the occasional rigour of Sec. 20 and to advance the objects of the Act. The Government uniformly exempted Sec. 20 of the Act in respect of all cooperative societies for which elections and Annual General Meetings for the years 1987-88, 1988-89, 1989-90 and 1990-91 is held and it is in operation only for a temporary period. It is respectfully submitted the impugned Government Order does not have the effect ofchanging legislative policy or the essential character of the Act.'
If as the State says all the aforesaid institutions had become sick because of Government policies then I am afraid the State has chosen the wrong antidote to cure them of their malady by resorting to an over-extensive user of the right to grant exemption to all societies by having power on Section 121 of the Act. If I may say so once again, members are in no way responsible for the institutions turning sick in the sense of becoming ineligible for exercise of franchise guaranteed to them under Section 20 but denied for whatever reason it may be as claimed herein by Government in their statement of objections. I see no connection between the policy decision of the Government and the total failure in the performance of its duty by a society. It seems to me this is an instance of power being indiscriminately used for a purpose wholly unconnected with the object now projected before Court. The Supreme Court in Registrar, Co-Op. Societies v. Kunjambu, : [1980]2SCR260 while holding Section 60 of Madras Co-operative Societies Act, which is akin to Sec. 121 of the Act as not void on the ground of excessive delegation of power, observed at page 354 :
'In fact, the too rigorous applications of some of the provision of the Act may itself occasionally result in frustrating the very object of the Act instead of advancing them. It is to provide for such situations that the Government is invested by Sec. 60 with a power to relax the occasional rigour of the provisions of the Aet and to advance the object of the Act.'
Herein the Government states that the too rigorous application of Sec. 20 would have frustrated the object of the Act i.e., holding of general elections and the conducting of annual general body meeting as enjoined under Sec. 28A of the Act and, therefore, it is they had to resort to this type of extensive curative process. But, then, even that should be done as pointed out by the Supreme Court in the decision supra so as to subserve the object of the Act. There is no gainsay indenying that the object of the Act is to ensure that the Co-operative movement conceived on the basis of mutual help and voluntary service to help the small farmers, artisans and agriculturists to get !he best of the bargains eliminating parasitical middlemen. If to help these small people, Co-operative Societies are formed and loans are given, they in turn are expected to display a bit of promptitude in discharging obligations undertaken by them and any default in that regard should necessarily invite a sound reproach and wrath in good measure. Section 20 is enacted precisely for the said purpose and the contemplated display of denigration takes the form of denial of franchise to defaulters whoever it may be an individual member or an institution. True as pointed out by the Supreme Court in Registrar v. Kunjambu, : [1980]2SCR260 that in extraordinary situations to save the institutions recourse could be taken to some extraordinary measures to bring about normalcy in a Co-operative institution sued. That is done by taking power from the fountain-source under Sec. 121 made operative by granting suitable exemptions and modifications. If this remedy available under the Act for sustaining the object of the Act is availed of in a manner destructive of the very fabric of the Act, such an overact would mutilate and render waste a salutary provision like Section 20 as has happened in this case, serving as a general cover to protect all truants whether they arc individuals or institutions, and in such situation I am afraid it is different even to imagine muchless to expect the remedial power under Section 121 could be availed oft by the State in the manner done in these cases. I am afraid that the impugned order of the Government passed on 23rd September, 1991 is totally indefensible and cannot be sustained on any ground whatsoever.
16. Barrister Reddy attacked the order also on the ground that it violated Article 14 of the Constitution. According to counsel the order is wholly arbitrary and totally capricious indicating a devil-may-care attitude they should not brook judicial scrutiny at all. He read to me a number of decisions, including the latest in the series Shrilekha Vidyarthiv. State of U. P., : AIR1991SC537 .In that case it was held that the post of a District Government Counsel does have a public clement attached to it and where all Dist. Govt. counsel in State were removed en bloc by the State Government such action can be judicially reviewed under Art. 14 of the Constitution. It is not necessary, however, to appeal to the aforesaid aspect, in this case for I have on other grounds arrived at a finding that the impugned orders are not sustainable.
17. Long years ago the English daily, The Hindu dated 2nd December, 1941 carried a report pertaining to Co-operative movement in India. At the Silver Jubilee celebration of the District Central Co-operative Bank in Masilipattinam Mr. Shrinivasan, the distinguished editor of the Hindu and a keen observer of economic affairs of the country made some telling observations touching the working of the Co-operative movement and noted with regret the increasing interference by Government Officers in the matter of control and direction of the Co-operative institutions. The observations are so apposite to the present context I am tempted to quote them;
'In this situation if we examine the State of co-operation, I must confess my great distress to see the suspicion and jealousy that divide the ranks of our Co-operators and dissipate their energy. Further there really ought to be no place in the movement for officials. Direction and control ought to vest with such non-officials as will strengthen the movement There ought not to be Government mistrust of co-operators. A co-operative movement in which there is distrust of whatever kind cannot succeed.
Co-operative banks derive their funds from public deposits and therefore care and caution are need in their investment policies and actions. Oftentimes, misplaced sympathy with desperate needs have led to investments and other action of an indefensible nature. Not a few seek places of primacy in cooperative institutions to take liberties with moneys that belong to others. Some of course do so out of ignorance but this fact will not save the institutions from the disastrous effects of folly. Here is an important area for public responsibility to be conspicuously displayed and the right kind of leadership to be developed.....
It is only too necessary for co-operative institutions to realise that they are not charitable institution. They are business institutions and will not succeed unless run strictly on business lines. On the administrative side every co-operative organisation should be equipped with sufficient professional skill. The Boards of directors must contribute to successful working by using the local knowledge and know how of men and matters that they command. The working of every co-operative should be justified by the reputation it develops that every proposal put before it will be considered on the fairest manner possible.'
As pointed out by the Economist of yester years, reputation of the institution for clean and efficient administration is a must. Loss of such reputation must mean something more than wiping a head of sweat from one's eyebrow. If an institution mismanages its funds, falls-back in its recoveries and falls back in repayment of its debts and if by that act forfeits the right of franchise under the Act, it would not do to give it a turn-around by granting a reprieve from discharging its obligations, thereby enabling it to exercise its franchise to which right it had become disentitled to under the Act. But more than this, imagine the travesty of the entire thing and of course the paradoxical consequence of allowing a defaulter to exercise his or its right to vote despite denial by the Act. The Act says the defaulter shall not vote. Can the Government say I exempt you from the operation of that injunction and, therefore, you can vote? The net result, let it not be forgotten, would be that a voter disentitled under the law to exercise his franchise is allowed to vote. It is like granting a minor the right to vote although in law he does not possess such a right. It is as fallacious as that. Can it then be said that the blanket reprieve granted by Government in exercise of its powers under Sec. 121 of the Act is legal and was intended to further the objects of the Act? Nay, it only leads to defeating the several salutary objectsof the Act. In attempting to exempt individuals and institutions alike from the operation of Section 20 of the Act, it must be said without clear that the Government has taken a false step in the name of law. I do not wish to say anything more. I conclude by summing up my views as follows :--
i) The impugned orders are invalid and otiose having been made or passed without reference to any ostensible reason or requirement, they are totally arbitrary and absolutely capricious.
ii) They are wholly in excess of the Government's competence under Section 121 of the Act.
18. For the reasons aforesaid and in the light of the conclusions reached by me, these writ petitions are allowed and the orders of the Government dated 28th May, 1990, (ii) 22nd July, 1991, and (iii) 23rd September, 1991, are hereby quashed. There will now be a direction to hold elections to all these institutions from the stage at which they stood interrupted by any interim order made in these writ petitions. Elections shall be held and concluded within four weeks from the date of receipt of this order.
The State Government will pay to the petitioners in each of these cases their costs. Advocate's fee Rs. 1000/- in one set only.
After I pronounced this judgment it is pointed out by learned counsel appearing for the petitioners that the process of election should begin all over and it cannot continue from the stage of which it was interrupted. That appears to be correct.
Therefore, it is, I now supplement the order already made by giving a direction that the elections interrupted by the interim order of this court will be started afresh by publication of fresh calendar of events taking note of the developments already adverted into in this judgment.
The order directing holding of elections from the stage at which they were interrupted shall stand deleted.
19. Order accordingly.