Maharaja Jiwajirao Education Society and Shri Pratap Bhanu Sharma Vs. State of Madhya Pradesh and ors. - Court Judgment

Excerpt:
trusts & societies - governing body - section 33 of the m.p. society registrikaran adhiniyam, 1973(act) - petitioner was society registered under act - show cause notice issued to petitioner wherein various allegations were made due to which governing body of society proposed to be superseded under section 33 of act - order passed for superseding governing body - petitioners challenged the same by filing writ petition before this court - court granted interim order of stay -thereafter, respondent no. 1 modified earlier order and final order was issued by state government for canceling order of suppression - accordingly, petition was disposed of by giving liberty to state government to proceed in matter in accordance with law - thereafter, respondent passed another order of superseding.....orderrajendra menon, j.1. challenge in this petition under article 226 and 227 of the constitution is made to orders annexures p/1, p/2, p/3 and p/4 respectively. annexure p/1 is a order dated 11.10.05 by which governing body of the petitioner's society has been superseded and a new adhoc committee appointed. annexure p/2 is the show cause notice dated 16.1.04 issued to the petitioner's society under section 33 of the m.p. society registrikaran adhiniyam, 1973. annexure p/3 is the order dated 13.10.05 by which members who have been nominated vide order annexure p/1 dated 11.10.05 have been intimated to take over charge and the order annexure p/4 dated 13.10.05 is a letter sent by the secretary of the nominated body to the bank to stay operation of the bank accounts.2. maharaja jiwaji rao.....

Judgment:
ORDER

Rajendra Menon, J.

1. Challenge in this petition under Article 226 and 227 of the Constitution is made to orders annexures P/1, P/2, P/3 and P/4 respectively. Annexure P/1 is a order dated 11.10.05 by which governing body of the petitioner's society has been superseded and a new adhoc committee appointed. Annexure P/2 is the show cause notice dated 16.1.04 issued to the petitioner's society under Section 33 of the M.P. Society Registrikaran Adhiniyam, 1973. Annexure P/3 is the order dated 13.10.05 by which members who have been nominated vide order annexure P/1 dated 11.10.05 have been intimated to take over charge and the order annexure P/4 dated 13.10.05 is a letter sent by the Secretary of the nominated body to the Bank to stay operation of the bank accounts.

2. Maharaja Jiwaji Rao Education Society is a society registered under the provisions of M.P. Society Registrikaran Adhiniyam, 1973 (herein after referred to as the Adhiniyam of 1973') vide registration certificate annexure P/5. Annexure P/6 and P/7 are the memorandum of association, rules and regulations and the bye-laws of the society.

3. Society in question is running two educational institutes namely the Samrat Ashoka Technology Institute (Engineering College) Vidisha and Samrat Ashoka Technology Institute (Polytechnic College) Vidisha. Both these colleges have been referred to as the Engineering College and Polytechnic College run by the society.

4. According to the petitioners the total strength of students prosecuting their studies in both these institutes are about 4000 and both these institutes together have a strength of about 200 teaching staff, 150 non-teaching staff and about 300 class III and class IV employees. The institutes are receiving financial aid from the State Government and it is stated that the Institutes in question are two premier institutes of the State and as on date the total assets of the petitioner's society is more than Rs. 663 Lacs.

5. Grievance of the petitioner's society before this Court is that respondent No. 5 had been making serious endeavor since a long period of time to stall the normal functioning of the petitioner's society. His aim was to take over the administration and management of the society. It is stated that the present action taken and the orders impugned in this petition with regard to super-session of the society are a result of the aforesaid efforts of respondent No. 5. It is alleged that respondent No. 5 had filed various petitions before this Court. Initially when there was some dispute with regard to election to the governing body of the society, the society was superseded by the Collector in the year 1994 and a Writ Petition No. 4/1995 filed by respondent No. 5, wherein this Court on 9.7.96 directed respondent No. 3 to hold elections and it was directed that the Administrator shall hand over charge to the newly elected body. It is the case of the petitioner's' that in compliance with the orders passed by this court elections to the society were held on 21.4.97and in the said election late Madhavrao Scindia was elected as President and Dr. Padamchand Jain was elected as Secretary. After holding of' the election, respondent No. 3 handed over charge to the newly elected governing body of the society and since then the elected governing body is managing the affairs of the society.

6. The validity of this elation dated 21.4.97 was challenged by respondent No. 5 in Writ Petition No. 628/97. This petition was dismissed vide order dated 20.8.98. A copy of the said order is annexure P/15 in this petition. Against this order a Letters Patent Appeal was filed before this Court which was also disposed of. Thereafter, respondent No. 5 again filed another petition on 10.4.01 being W.P.662/01 wherein a prayer was made that charge of the petitioner's society be given to the governing body which was functioning prior to 22.12.94. In this petition a order was passed by this Court vide annexure P/17 on 26.4.01 directing for maintaining the status-quo in the matter. This petition has also been dismissed. In the meanwhile complaining violation of the order of status-quo passed on 26.4.01, respondent No. 5 has filed Contempt Petition being M.C.C.50/02 which is pending. It is stated that all these facts go to indicate that in some way or the other respondent No. 5 wanted to stall the working of the governing body which was elected in accordance with the directives issued by this Court on 21.4.97 and ultimately when elections to the State assembly were held in Dec, 2003, respondent No. 5 was elected as member of the legislative assembly and became Finance Minister of the State in Dec.2003. Immediately after he came to power, at his instance a show cause notice annexure P/2 dated 16.1.04 was issued to the petitioner's society. Various allegations were made in the said show cause notice and Governing body of the society was proposed to be superseded under Section 33 of the Adhiniyam of 1973. Thereafter, a order was passed superseding the governing body on 13.2.04 vide annexure P/30. As this order was illegal petitioners challenged the same by filing W.P. No. 702/04 before this Court. This Court granted a interim order of stay on 15.4.04. Thereafter, vide order dated 24.2.04 'respondent No. 1 modified the earlier order annexure P/30 dated 13.2.04 and finally a order was issued by the State Govt. on 24.2.04 cancelling the order of supersession dated 13.2.04. Accordingly, petition W.P.702/04 was disposed of by this Court on 19.8.04 vide annexure P/35 giving liberty to the State Govt. to proceed in the matter in accordance with law. Grievance of the petitioner's is that without issuing any show cause notice thereafter and without granting opportunity of hearing and by ignoring the statutory provisions of the Adhiniyam of 1973, the impugned orders have been passed and action taken.

7. On the basis of the aforesaid facts it was argued by Shri A.K. Chltlay, learned senior counsel for the petitioner's that the entire action taken against the petitioner's is illegal. Basically two grounds were raised by learned senior counsel Shri A.K. Chitlay at the time of hearing. The first ground urged was that petitioner's society is not a 'State Aided Society' within the meaning of Section 3(f) of the Adhiniyam of 1973 and, therefore, no order superseding the society -under Section 33 of the Adhiniyam can be passed. Second ground urged la that before taking action in the matter procedure as contemplated as under Section 32 and 33, with regard to grant of proper opportunity of hearing was not afforded to the society. To elaborate this ground it was stated that action was taken because of the malafides of respondent No. 5 and in doing so a perverse finding has been recorded by the State Govt., rejecting the contentions of the petitioner's and without giving them proper opportunity, without considering their defence and explanation to the show cause notice action taken is said to be illegal.

8. It was argued by Shri A.K. Chitlay that the society in question is not receiving any aid from the State Govt. It was emphasised by him that the two Institutes are receiving grant-in-aid and the governing body of the two institutes are entirely different. The governing body of the Institutes are constituted as per the guidelines and the policies laid down in the All India Council of Technical Education Act and as the governing bodies of the Institutes are independent legal entities receiving the grant-in-aid, action under Section 33 cannot be taken against the petitioner's society. It was emphasised by Shri Chitaley that once it is established that the society is not receiving any grant-in-aid, state Govt. cannot take any action in the matter. By taking me through the provisions of the All India Council of Technical Education Act, 1987 guidelines issued in the matter of appointment of governing bodies under the Act, Shri Chitaley argued that no grant is being provided by the state Govt. to the society and by misconstruing the grant directly paid to the Institutes as grant, paid to the petitioner's society and by treating the society to be k 'State aided society' within the meaning of Section 3(f) of the Adhiniyam of 1973 action taken is said to be illegal.

9. Shri Chitaley further argued that before taking action in the matter procedure as contemplated under Section 33 of the Adhiniyam of 1973 was not followed and without granting proper opportunity to cross examine the Enquiry Officer who has given some report in the matter and without considering the reply submitted by the society action taken is unsustainable. Shri Chitaley emphasised that principles of natural justice have been violated in the matter of taking action against the petitioner's society and by taking me through the allegations levelled in the show cause notice annexure P/2 dated 16.1.04, the reply submitted by the petitioner's society as contained in annexure P/29 dated 19.1.04 and the manner in which the reply was considered in the impugned order annexure. P/1 dated 11.10.05 Shri Chitaley tried to emphasise that the state Govt. has acted mechanically in the matter without application of mind and the entire action taken at the instance of respondent No. 5 due to his personal bias and malafides is unsustainable. It was stated by Shri Chitaley that the Institutes in question are functioning as per the guidelines issued by the All India Council of Technical Education discharging statutory functions under the All India Council of Technical Education Act, 1987. The Regulatory authority under this Act is monitoring the functions of the Institutes and the grant-in-aid is being made to the Institutes is in accordance with the rules framed under the M.P. Ashashkiya Shikshan Sansthan (Adhyapakon Tatha Anya Karmachariyon Ke Vetan Ka Sandai) Adhiniyam, 1978, (herein after referred to as the Adhiniyam of 1978') and, therefore, taking action in the matter against the petitioners treating it to be a state aided society is not proper. It was also submitted by learned senior counsel that initially when the show cause notice annexure P/2 dated 16.1.04 was issued the matter came to this Court in W.P.702/04 and after this petition was disposed of on 19.8.04, no further show cause notice was issued to the petitioner's. Accordingly, it is stated that the principles of natural justice have been violated and, therefore, interference in the matter is sought for. It was further submitted by Shri Chitaley that even if for a moment the allegations stated in the show cause notice is found to be correct then also the drastic step of superseding the society could not be taken. Opportunity to rectify the mistake should have been granted and without granting any opportunity to rectify the mistake the drastic action taken for superseding the governing body is said to be illegal. It was further argued by Shri Chitaley that the malafides of respondent No. 5 can be seen from the communication made by him vide annexure P/58 on 21.10.04 wherein he has written to his counsel for taking action in the matter. It was further stated that arguments in the matter were heard by the competent authority of the State Govt. on 7.3.05 and thereafter no order was passed for about 10 months. It was only after 7 months on 11.10.05 that the impugned order annexure P/1 was passed and this was only because respondent No. 5 was interferring in the matter and the order was passed after his clearance and after taking his opinion into consideration. Accordingly, attributing malafides to respondent No. 5 and contending that action taken without opportunity of hearing is unsustainable, petitioner's seeks interference in the matter.

10. In support of the aforesaid contentions Shri Chitaley relied upon the following judgments:

i). Chhatarpur Homoeopathic and Biochemic Association v. State of M.P. and Ors. 2001 (3) MPLJ 405, to show that petitioner's society is not a 'State Aided Society'.

ii) Jt. Registrar of Cooperative Soclities, Kerala v. T.A. Kuttappan and Ors. and A.M.S. Sushanth and Ors. v. M. Sujatha and Ors. show the objects and purpose of taking action in such matters.

11. Refutting the aforesaid Shri R.N. Singh, learned Advocate General submitted that the petitioner's society had committed default for a long period of time right from the year 1997 onwards. It is pointed out by the learned Advocate General that as per the amended bye-laws and memorandum of association of the society annexure R/1 they are required to hold meetings of the General body but when meetings were not held and the list of office bearers of the society were also not maintained in accordance with the statutory requirements as contemplated under the provisions of Adhiniyam of 1973 a show cause notice under Section 32(1) was issued to the society on 13.11.01. On the said date when the show cause notice was issued fro the petitioner's society, respondent No. 5 was not a member of the legislative assembly and the present Govt. was also not in power. Initially action was initiated against the petitioner's society on 13.11.01 by the previous Govt. itself and after issuing show cause notice a Enquiry Officer appointed gave opportunity of hearing to the petitioner's society and found that the petitioner's society has committed various irregularities in the matter. More than 30 allegations were levelled against the petitioner's society and were found proved in the enquiry so conducted, the Enquiry Officer submitted his report running into more than 26 pages on 31.7.02 vide annexure R/5. Against the aforesaid Enquiry report, petitioner's society preferred a appeal ;when the same was forwarded to them on 9.8.02 vide annexure R/6 and the appeal filed by the petitioner's society against the aforesaid enquiry report was rejected on 6.5.03 vide annexure R/7, Referring to these facts it was pointed out by Shri R.N. Singh, learned Advocate General that the irregularities as highlighted in the enquiry report dated 31.07.02 (Annexure R/5) were established and proved even before the present Government came into power in December, 2003 but as no action was taken inspite of rejection of the appeal on 6.5.03, and as serious irregularities in the matter were established the action impugned was taken.

12. Taking me through the allegations levelled in the show cause notice dated 16.1.04., the reply submitted by the petitioner's, the report of the Enquiry Officer so also the statutory provisions of the Adhiniyam of 1973, Shri Singh pointed out that there is no malafides in the matter, petitioner's has unnecessarily attributed malafides to respondent No. 5 even though action now taken was only continuation of the action already initiated against the petitioners in the year 2001 when show cause notice dated 13.11.01 was issued to the petitioner's. Refutting the contentions of malafides so also arguments with regard to non grant of opportunity, Shri R.N. Singh, learned Advocate General taking me through each and every allegations levelled against the petitioner's society, the reply submitted by the petitioner's society and the t findings recorded in the matter by the impugned order tried to demonstrate before this Court that the contentions of the petitioner's society made with regard to malafides of respondent No. 5 and non grant of opportunity and perversity in the findings are incorrect.

13. As far as the allegations with regard to petitioner's society not being a 'State Aided Society' is concerned Shri R.N. Singh, learned Advocate General invited my attention to the definition of 'State Aided Society' as appearing in Section 2(f) of the Adhiniyam of 1973, the definition of 'Institute' as appearing in the Adhiniyam of 1978, the provisions of grant-in-aid rules framed by the State Govt. as contained in annexure P/51 and argued that grant-in-aid is given to the society and it is the ' society under whose supervision and control the grant allotted is utilised for maintaining the educational institutes. Referring to the- provisions contained in the statutory rules referred to herein above so also the balance-sheets, filed by the petitioner's society Shri R.N. Singh, learned Advocate General submitted that the contentions that the petitioner's society is not a 'State Aided Society' is not correct. He also refutted the contention of malafides and it was submitted by him that the communication made by respondent No. 5 to his counsel vide letter annexure P/58 does not demonstrate malafides. Shri R.N. Singh submitted that there is no material available on record to establish the malafides in the matter and as action taken is on the basis of proceedings already initiated by the previous Govt., the contention of the petitioner's is said to be incorrect.

14. Shri R.D. Jain, learned senior counsel representing respondent No. 5 also argued in similar lines and it was pointed out by him that; the malafides have not been established in the matter and action taken being in accordance with law the same does not call for any interference in this petition.

15. Shri D.P. Singh, learned Counsel representing respondent No. 4 also supported the contentions put forth by Shri R.N. Singh and Shri R.D. Jain learned senior advocates.

16. During the course of hearing learned Counsel representing the parties took me through various averments made in the petition, in the return and rejoinder and in detail elaborated the contentions made by them on the points as indicated herein above.

17. Shri R.N. Singh, learned Advocate General in support of his contentions placed reliance on the following judgments:

Regional Manager, U.P.S.R.T.C. Etawah and Ors. v. Hotilal and Anr. , the observations made by bench of this Court in its order dated 27/10/2005 in W.P.3208/04, State of Punjab V.K. Khanna AIR 2001 SC 343, Dharam Dutt and Ors. v. Union of India and Ors. AIR 2004 80 1295 2004 80 1295 and Patrakar Bhawan Samiti, Bhopal v. State of M.P. and Ors. 2000(1) MPLJ 239, Union of Indiav v. Parma Nanda and State of U.P. and Ors. v. Maharaja Dharmander Prasad Singh etc. .

18. I have heard learned Counsel for the parties at length and perused the record.

19. As has been indicated herein above the points for determination in this petition can be summarised as under:

i) Whether the petitioner's society is a 'State Aided Society' within the meaning of Section 2(f) of the Adhiniyam of 1973

ii) Whether the action taken in the matter is after giving due opportunity of hearing to the petitioner's society and after considering the reply and explanation submitted by them

iii) Whether the malafides attributed to respondent No. . 5 are established and because of the same entire action stands vitiated.

iv) Whether interference can be made in the matter by this Court exercising jurisdiction in a petition under Article 226 of the Constitution.

20. I will now take up for consideration the aforesaid four questions involved in this petition. 20. In Section 2(f) of the Adhiniyam of 1973 a 'State Aided Society' is defined as under:

2(F) 'State Aided Society' means a society which receives or has received aid, grant or loan or has received land or building or both on concessional rates and other facilities from the Central Government or State Government or any statutory body.

21. it is clear from the aforesaid that a State Aided Society is a society which receives or has received any aid, grant or loan, land or building on concessional rates from the Central Govt. or the State Govt. or any statutory body. A 'Aided Institute' is not defined in the Adhiniyam of 1978 but a 'Institute' is defined in the aforesaid Adhiniyam under Section 2(e) to mean as under:

2.(e) 'Institution' means a non Government School or non-Government Educational Institution for higher education for the time being receiving maintenance grant from the State Government or from the Madhya Pradesh Uchcha Shiksha Anudan Ayog, as the case may be, established, administered and managed by a society registered or deemed to be registered under the Madhya Pradesh Society Registrikaran Adhiniyam. 1973 (No. 44 of 1973) but does not include an institution established, administered and managed by-

(i) the Central Government; or

ii) the State Government; or

(iii) a local authority, or

(iv) any agency managed, controlled, approved or sponsored by the Central Government or the state Government, as the State Government may, by notification, spoecify;

(v) a non-trading corporation formed and registered under the Madhya Pradesh Non-trading Corporation Act, 1962 (No. 20 of 1962) or deemed to have been registered thereunder;

(Emphasis Supplied)

22. A perusal of the definition of the 'Institute' appearing in the Adhiniyam of 1978 indicates that it is a non Governmental Education Institute for higher Education, receiving maintenance grant from the State Govt. or from the Uchcha Shiksha Anudan Ayog as the case may be and the said 'Institute' is established, administered and managed by a society registered or deemed to have been registered under the Adhiniyam of 1973. It is, therefore, clear from this definition that a Institute which is not administered and managed by a society registered under the M.P. Society Registrikaran Adhiniyam, 1973 will not get grant-in-aid from the State Govt. It is not the case of the petitioner's society that the two education institutes namely the Engineering College and the Polytechnic College are two separate societies registered under the Adhiniyam of 1973. On the contrary, it is admitted position that the institutes are managed and administered by the petitioner's society which is society registered under the Adhiniyam of 1973. At this juncture it would be appropriate to refer to the 'memorandum of association' and 'bye-laws' of the petitioner's society.

23. The amended memorandum of association annexure R/1 indicates that the Maharaja Jiwaji Rao Education Society has been established with the object of administering and managing the funds which may be received from time to time from any source whatsoever for elsewhere for imparting technical vocational education. Clause 2-B of the memorandum of association -indicates that the society has been established to run a institute for imparting technical education in civil, mechanical and electrical engineering and the society is empowered to acquire purchase, exchange, lease, gift or otherwise hold, sell, receive and purchase propery both movable and immovable in any part of India and to administer and utilise such property for completing in furtherance of the aims and objects of the society. The aims and objects of the society clearly indiates that it has been created for the purpose of running the education institutes and as on date the petitioner's society has established only two institutes namely the 'Engineering Institute' and the polytechnic Institute' and apart from these two Institutes, the petitioner's' society does not run any other institute. Constitution of the governing body of the petitioner's society is contemplated in clause 5 of the memorandum of association and it was constituted vide resolution dated 19.4.90 and the nine persons who are subscribers to the memorandum of association indicates that respondent No. 5 was the founder Secretary of the society. The procedure for constitution of the Board of Governance of the society is contemplated in Clause 6 of the memorandum of association and the Board of Governance Constituted at the time of formation of the society is indicated in the said memorandum of association. Thereafter, Clause 6-A and Clause 6-B of the memorandum of association indicates that by two resolutions passed on 10.7.91, two separate bodies for administration of Samrat Ashok Technology Institute, Vidisha and the Samrat Ashok Institute (decree section) were constituted. It is, therefore, clear from the memorandum of association that the Institutes in question and the governing body for administration of these institutes were created and established by the society itself while subscribing to the memorandum of association.

24. Clause 8 of the memorandum of association Indicates that all properly of the society both movable and immovable and all its fund shall vest in the society and Clause 10 of the memorandum of association further indicates that a General Body meeting of the members of the society shall be held once in a year for the purpose of considering and adopting the annual accounts and the report on the working of the society and the Institutes run by the society so also to transact all business pertaining to such Institutes. Thereafter, the Articles of Association (Rules and Regulations) of Maharaja Jiwaji Rao Education Society, Vidisha, annexure R/2 indicates that the meeting of the society and the Board of Governance shall be held at the registered office of the society or at other place fixed by the President and the meeting shall be held annually to consider the annual report and statement of account of the society together with a review of the working of the Institutes run by the society, the annual budget of the society and the budget of various institutes run by the society shall be transacted in this annual general body meeting. Budget of various institutes run by the society and working of the Institutes run by the society are also to be transacted in the annual meeting of the society. Powers of the governing body are contained in Clause 12 of the Article of Association annexure R/2 and the powers of the governing body of the society includes exercising all supervisory and financial control over the Institute or Institutions functioning under the society and to make recommendations to the society with regard to budget of the Institute run by the society. The governing body is also empowered in general to, attend to all affairs regarding running of the Institutes established by the society.

25. It is, therefore, clear from the/aforesaid provisions of the memorandum of association and article of association that the powers of supervision, administration and control of the education institutes established by the society vests with the governing body of the society. Available on record are the grants made by the State Govt. to the institutes and the order annexure R/3 indicates that grant is made in the name of the institute By the State Govt. However, this grant made by the State Govt. is in accordance with the Adhiniyam of 1978 and the rules framed under the said Adhiniyam. Petitioner themselves by filing the grant made to the institute in the document annexure P/3 have accepted that the education institutes run by the society are receiving grant-in-aid. Shri Chitaley has tried to point out that grant is being paid to the institutes and not to the society and, therefore, the society is not a 'state aided institute'. It is to be taken note of that the grant is being made to the institute in view of the requirement of the statutory provisions as contained in the Adhiniyam of 1978 and the rules framed by the State Govt. For non Governmental institutions technical in M.P. (Annexure P/51). As per the said rules a institute means a institute that is a Engineering College, the Polytechnic College or other institute and the grants made to such institutes are classified as maintenance grant, building grant and equipment grant. Rule 8 of the aforesaid rules contemplates that the governing body of every aided institute has to be registered under the society registration Act of 1973 to be eligible to receive grant-in-aid. A complete reading of the aforesaid rules alongwith the definition of the 'Institute' as appearing in Section 2(e) of the Adhiniyam of 1978 indicates that ' even though grant-in-aid is made in the name of the Institute but only such Institutes are eligible to receive grant in aid which are managed by a governing body registered under the Adhiniyam of 1978.

26. In the present case even though payment of grant is not directly made in the name of the society, payments are made in the names, of the institutes in view of the requirement of the statuory rules prescribing the procedure for disbursement of grant-in-aid. Petitioner, society is administering and supervising the institutes in question which are receiving grant-in-aid and the institutes are receiving grant only because they are administered by the governing body of the petitioner's society. That apart, the institutes in question are not separate legal entity having any independent existence. It is the society which is administering the institutes, supervising its work and controlling its functioning so far as important policy matters are concerned, so also making provisions of allocation of budget. That being so, it has to be held that the society is administering the institutes and for the purpose of maintaining the institutes the fund and grants are made by the state Govt. in the name of the Institutes which is utilised by the petitioner's society for running the institutes. The guidelines issued by the All India council of Technical Education and the Governing body of the institution formulated as per the guidelines issued by the Council only pertains to grant of statutory recognition under the aforesaid provisions i.e. for the purpose of recognising the institutes and the course conducted by the Institutes. Even in these guidelines as contained in annexure p/52 the Institutes should be run by a registered society and the governing body of the institute is to be headed by the Chairman nominated by the registered society and a member also nominated by the registered society.

27. It is clear from these guidelines issued by the AICTE also that the society or the trust which has established the education institutes shall exercise control over the institutes through the governing body nominated under these guidelines. That being so, the arguments of Shri A.K. Chitaley, learned senior counsel to the effect that society is not receiving any grant-in-aid cannot be accepted. Once it is established that the institutes are running on the basis of the grant made by the State Govt. society automatically becomes a society receiving the grant-in-aid from the State Govt. If the society was not registered under the Adhiniyam of 1973 and the governing body was not duly constituted then the Institutes in question would not be entitled to receive any grant from the State Govt. That being the factual position, the institutes in question which are receiving grant-in-aid are the integral part of the society and the society is, therefore, deemed to be a state aided society within the meaning of Section 3(f) of the society Registrikaran Adhiniyam. The two institutes are receiving grant only because they are established by the petitioner's society. If the petitioner's society withdraw itself from the activities of the institution the. State Government will have to refuse grant-in-aid to the institution as the statutory rules do net permit making of such a grant to a institute which is not established by a Registered Society.

28. At this stage it would be relevant to consider the balance sheets produced by the petitioner's society and which are available, on record. A perusal of the balance sheets produced by the petitioner's indicates that these are the audited balance sheets of the petitioner's society and the same are contained in the document annexure P/22. Even though separate income and expenditure accounts of both the institutes are maintained the consolidated balance sheets of the society available on record indicate that the bulk grant, received from the State Govt. for the institution are shown in the balance-sheets of the society as its income. Audit report annexure P/48 and the, balance sheet of Maharaja Jiwajirad Education Society for the year ending 31.3.02 as contained in page 259 of the paper book indicates that a capital grant-in-aid to the college building and grant for degree college of Rs. 13.3 Lacs was received. Similarly capital grant of Rs. 2.5 Lacs was received for the polytechnic college as is indicated in the balance sheet of the society for the year ending 31.3.02. Similarly, grant received by the Govt. is indicated in the balances-sheet of the Society for the year ending 31.3.03 and 31.3.04 and in all these balance sheets capital grant-in-aid to the college towards building fund, grant for providing miscellaneous fixed assets to the degree college and capital grant-in-aid for technical college, polytechnic college are indicated in the balance-sheets as income of the society. It is clear from these balance sheets that the grant-in-aid received for the institutes are reflected in the balance-sheets of the society as its income and it is with the aid of these grants that both the institutes namely the Polytechnic institute and the Engineering institute are being run by the petitioner's society.

29. A completes analysis of the aforesaid factual aspect of the matter leads to a inevitable conclusion that the society was established with the aim and object of establishing various technical education institutes, in furtherance to the said aims and objects two institutes one engineering institute and another polytechnic institute have been established by the petitioner's society. Both these institutes are situated in district Vidisha of M.P. and it is the governing body of the society which is administering, managing and supervising the affairs of these two institutes. These two institutes, are not separate legal entity, they are receiving grant-in-aid in their name only because, of the requirement of the statutory rules under the (sic) of 1978 framed by the State Govt. Infact, the petitioner's society is administering and carrying out the various activities of these institutes only on the basis of grant-in-aid received by the State Govt. That being so, it cannot be: held that the -society is not receiving any grant-in-aid. Infact, the society in question is receiving grant-in-aid in the name of these two institutes and it is administrating and carrying out the activities of these institutes on the basis of grant received from the State Govt. Accordingly, the first contention advanced by Shri A.K. Chitaley has to be answered by holding that the society in question is a 'Stats Aided society' and., therefore, amenable to the provisions of Section 33 of the Society Registrikaran Adhiniyam, 1973.

30. The next point raised was with regard to grant of opportunity of hearing and violation of the principles of natural justice in the matter of taking action against the petitioners.

31. As far as this question is concerned, Shri A.K. Chitaley had pointed out that once action was proposed to be taken under Section 32 and enquiry was completed and the Enquiry Officer appointed had given his report, thereafter without completing this procedure taking recourse of the remedy under Section 33 was not justified. This argument is wholly misconceived. Section 32 and Section 33 of the Adhiniyam of 1973 are independent of each other merely because certain proceedings and enquiry under Section 32 were ordered and after the enquiry report annexure R/5 was submitted. If the Govt. did not take any action and kept quiet over the master for some time it does not preclude the Govt. subsequently from initiating fresh action Under Section 33 for supersession of the Governing body. If the Govt. on the basis of material available forms a opinion that the Society has persistently made default or has been negligent in the performance of its duties action under Section 33 can be taken.

32. For taking action under Section 33 the only requirement to be complied with is the procedure contemplated Under Sub- section 2 of Section 33. The procedure therein requires that before parsing a order of super-session under Section 33(1) the Governing Body has to be given reasonable opportunity of showing cause against the proposed action and representation, if any is submitted, the same has to be considered. In the present case records indicates that show cause notice annexure P/2 was issued on 16.1.2004 and petitioner's was granted due opportunity of submitting its representation. Even though initially after show cause notice was issued on 16.1.2004 and a order of super-session was passed but the same was cancelled and thereafter in the light of the directives issued by this Court in W.P.702/04 further proceedings were held. Records indicates that opportunity was granted to the respondents, reply to the show cause notice were filed and written arguments were also filed. The same are available on record and are marked as annexure P/45 dated 28.12.2004, annexure P/46 dated 7.3.05. That apart, during the proceedings that were held before the competent authority in pursuance to the show cause notice dated 16.1.2004, a copy of the enquiry report dated 13.7.2004 was forwarded to the petitioner's on 17.8.04 and they were asked to give their written objection to the same. On behalf of the society written objections were filed on 25.11.04 in addition to the reply already filed earlier on 10.2.04. Thereafter, the case was listed for hearing on 8.2.05 and on that date Secretary of the Society appeared and sought time to file written statement. This prayer was allowed and petitioner's were granted time upto 4.3.05 to appear and submit argument. On 4.3.05 Secretary, of the Society Shri Padam Jain alongwtih Shri K.N. Gupta, Advocate appeared and oral arguments were advanced on behalf of the society. Thereafter, on 7.3.05 written explanation and evidence by way of documents were produced and the case was fixed for orders. Records indicates that the case was listed before the authorities on 10.2.04, 25.11.04, 8.2.05 and 7.3.05 on which dates submissions were made by the counsel.

33. It is, therefore, clear from the aforesaid fact that in the matter opportunity of hearing was extended to the petitioner's and it was only after giving due opportunity of hearing and representation to the petitioner's that action under Section 33 was taken. Even prior to that when the first notice under Section 32 was issued for enquiry on 13.11.01, the enquiry report annexure* R/5 dated 31.7.02 indicates that after the notice of enquiry was issued hearing was held in the office of the society at Vidisha on 27.11.01 and 28.11.01, During this enquiry Shri Padam Jain, Secretary of the society was present and the enquiry report indicates that Shri Padam Jain had sought 10 days time to produce various documents before the enquiry officer. As requested, time was granted and the case was thereafter adjourned upto 26.12.2001. Thereafter proceedings were held on various dates and enquiry was fixed on 17.4.2002 when again Shri Padam Jain appeared and stated that the entire records are not available, they are not ready as the meeting of the Board of Directors were held on 28.1.01 at Delhi and he was unable to produce the records, considering this, case was adjourned to 27.4.02 at Ujjain for further enquiry. However, on the said date Shri Jain did not appear alongwith the records and, therefore, the case was adjourned to 4.5.02 and the matter was intimated to the Secretary. On 14.5.02 also inspite of notice dated 14.5.02 records indicates that a telegram was sent by one Shri Rammohan Singhal, Advocate on behalf of the society seeking adjourment. Therefore, the matter was again adjourned and the case was listed for enquiry on 7.6.02. Notice in this regard was issued on 29.5.02 and inspite of opportunity being granted none appeared on 7.6.02. Inter alia holding that inspite of adjourning the case on various dates records are not being produced Enquiry Officer on the basis of the records made available and the inspection conducted decided the matter.

34. These facts indicate that while conducting the enquiry in pursuance to the proceedings initiated under Section 32 on 13.11.02 so also while taking action under Section 33 due opportunity of hearing was given to the petitioner's society and it was, the petitioner's society which, failed to avail of the opportunity granted to it by the Enquiry Officer who had submitted his report annexure R/5. Except for contending that the Enquiry Officer was not produced for cross examination and proper opportunity was not given nothing is pointed out as to in what manner opportunity was claimed and which was not granted. That apart, prejudice caused in the matter due to non-cross-examination of Enquiry Officer is also not established. The factual aspect of the matter available on record as indicated hereinabove clearly indicates that before taking action in the matter proper opportunity was granted to the petitioner's society and the contention that principles of natural justice were not followed is wholly misconceived.

35. The question of violation of principles of natural justice and denial of reasonable opportunity of hearing has to be judged on the principle of prejudice caused. While considering similar question with regard to denial of opportunity of hearing in a departmental enquiry Supreme Court in the case of State Bank of Patiala and Ors. v. S.K. Sharma has observed as under:

Justice means justice between both the parties. The interests of justice equally demand that the guilty should be punished and that technicalities and irregularities which do not occasion failure of justice are not allowed to defeat the ends of justice. Principles of natural justice are but the means to achieve the ends of justice. They cannot be perverted to achieve the very opposite end. That would be a counter -productive exercise.

Thereafter, in para 33, it has been so observed by the Supreme Court.

(4)(a) 'In the case of a procedural provision which is not of a mandatory character, the complaint of violation has to be examined for the standpoint of substantial compliance. Be that as it may, the order passed in violation of such a provision can be set aside only where such violation has occasioned prejudice to the delinquent employee.

36. Similarly in para 33.3, the question has been considered by the Supreme Court and it has been held that in cases where violation of procedural provision is complained of it has to be seen be kept in mind that procedural provisions are ment for affording reasonable and adequate opportunity to the person concerned. Violation of any and every procedure or provision will not automatically vitiate the entire proceedings. Except in cases falling under the category - 'No notice', 'No opportunity' and 'No hearing'. In all other cases where the procedure is not mandatory in nature prejudice caused has to be demonstrated and established. In the present case, if the allegation made by the petitioners is evaluated in the light of the law laid down by the Supreme Court in the case of S.K. Sharma (supra) except for contending that opportunity of hearing has not been given no specific violation is pointed out. Only violation pointed is that the enquiry officer was not produced for cross-examination. However, consequently, prejudice caused due to non-examination of the Enquiry Officer is neither established nor pleaded in this petition. That being so, on such consideration interference in the matter is not warranted.

37. Next question which now requires consideration is the arguments advanced on behalf of the petitioners to the effect that their representations and explanations to the allegations levelled in the show cause notice dated 16.1.2004 annexure P/2 have not been considered. In the show cause notice annexure P/2 15 irregularities are pointed out. It is stated in this show cause notice that the aforesaid irregularities have been committed by the petitioner's and the same is based on the report of enquiry submitted by the Enquiry Officer vide annexure R/5 it is pointed out in para 2 that enquiry under Section 33 is contemplated. The allegations, 15 in number, are indicated in the second paragraph. Thereafter, when W.P.702/04 was decided by this Court again annexure R/15 dated 17.8.2004 was issued to the petitioner's and alongwith this letter enquiry Report annexure: R/5 dated 31.7.02 was also forwarded to the petitioner's and they were asked to appear alongwith their representations and records on 27.8.2004 at 3:00 P.M. It is, therefore, clear that the enquiry report dated 31.7.02 and the allegations levelled in the show cause notice dated 16.1.2004 together form the material for taking action under Section 33.

38. first allegation in the' show cause notice dated 16.1.04 is that register of members is not properly maintained. This allegation was also part of the allegations in the enquiry conducted under Section 32. Explanation of the petitioner's to this allegation was that once the elections were held by the society on 21.4.1997 on the basis of order passed by the High Court in W.P.628/97 and once this election is upheld contention that register of membership is not maintained as required under Section 16 of the Adhiniyam is not correct.

39. Section 16 of the Adhiniyam contemplates that register of members has to be maintained giving the particulars as indicated in Sub- section 2 , thereof. This explanation has been considered by the competent authority and in the impugned No. 628/1997 was dismissed as having been having been rendered infructuous after the elections were held and there is nothing in the order passed by this Court in W.P.628/97 to indicate that this Court had approved the list of members. On the contrary the findings recorded in the enquiry report annexure R/5 also pertains to this charge. Charge No. 1 In the said enquiry is also with regard to submission of register of members under Section 16(1) read with Section 16(2) of the Adhiniyam. Both the authorities namely the Enquiry Officer who had conducted the enquiry in the year 2001 and had submitted his report annexure R/5 and the competent authority who had passed the impugned order annexure P/1 have taken note of these facts and the finding recorded is that right from 27.4.97 upto 10.2.04 when reply was filed, no list of members were submitted by the society and it was not available. Even in reply to the present proceedings no such list of members is produced. Only explanation given is that once the writ petition filed before this Court W.P.628/1997 was decided and elections were held in pursuance to the said decision, petitioner's wants a presumption to be drawn that the list of members were available in accordance with the requirement of Section 16. This is a incorrect and unsatisfactory explanation submitted by the petitioner's society. There is nothing in the order passed by this Court in W.P.628/97 to indicate that the list of membership and register of members is properly maintained. This aspect has been correctly assessed and considered by the State Govt. in the impugned order.

40. Second allegation was that annual meeting of the Board of Governance is not held in accordance with the requirement of Rule 3(B) of the memorandum of Association and the general meeting of the society as required under Clause 10 of the memorandum of association is also not held. Records indicate that between the period 21.4.1997 to 10.2.2004 when reply was submitted by the petitioner's to the State Govt. only 5 meetings were held. Three of these meetings were held in the year 1997 i.e. on 21.4.1997, 10.10.1997 and 24.10.1997. Thereafter , another meeting held on 12.4.1999 and another meeting on 28.4.2001. Clause 10 of the memorandum of association contemplates that a general meeting of the members of the society should be held once in a year to consider the annual report and the working of the society and the various institutes run by it. Clause 3(6) requires the business to be transacted in the annual meeting of the society. It is, therefore, clear that atleast once in a year meeting of the Governing body has to be held. Admittedly, no meetings were held in the year 1998, 2000, 2002, 2003 and in 2004 upto 10.2.2004 when the reply to the show cause notice was filed. Out of the five meetings which were held, one meeting held on 28.4.2001 was the meeting of the Governing body of the society. Another meeting held on 21.4.97 and 10.10.97 was a emergency meeting and a meeting of the Managing Committee. Even if all the five meetings are construed to be held as per Clause 10 then there is no explanation with regard to not holding of meeting in the years 1998, 2000, 2002 and 2003. Therefore, the authorities have found that this allegation is also correct.

41. Charge No. 3 pertains to violation of Clause 12 of memorandum of association with regard to not holding meeting in accordance with rules, in issuing proper notice of 7 days etc. These allegations wore found proved on the basis of the report submitted by the Enquiry Officer as contained in annexure R/5. It has been indicated in the finding recorded to this charge in the impugned order annexure P/1 to the effect that regular meeting as per rule 12 of the memorandum of association is not held, approval of budget have not been made and working of the Institute have not been reviewed every year in its meeting. It has been held that rule 12 of the memorandum of association has been violated. Similarly each and every allegation, 15 in number have been analysed by the authorities concerned and it was found that the Committee has violated the provisions of law in as much as it has not complied with the requirement of sections 16, 27, 28 and 29 of the Adhiniyam of 1973 and the memorandum of Association. The enquiry report annexure R/5 also indicates that 30 violations were established against the society.

42. With regard to maintenance of register of members the enquiry report annexure R/5 indicates that after the elections were held on 21.4.1997, two members namely Smt. Vijayraje Scindia and Shri Madhavrao Scindia have expired and after their death only 5 members remain. In the meeting that was held on 26.4.2001 decision was taken to terminate the membership of one Shri Hridayamohan Jain. If all these facts are accepted the report indicates that only 5 of the members remained and if that be so, the entire governing body has to be declared as illegal as the corum required is not fulfilled. Various irregularities in the matter have been highlighted and pointed out in these reports and the only reason indicated in the explanation to these allegations are that meetings were not held in view of a status-quo order passed by this Court in W.P.662/01. However, inspite of the order of status-quo passed by this Court in the said cases on 26.4.01, election to the governing body of the society was held on 21.4.1997 and a new President was elected. This explanation was considered and taking note of the totality of the circumstances it has been held that the explanation is unsatisfactory. The purpose of narrating the aforesaid facts is only to see as to whether proper consideration of the explanation is made or not and whether finding recorded by the authorities can be termed as perverse. A perusal of the impugned order annexure P/1 indicates that each and every explanation and reply submitted by the petitioner's were duly considered and rejected by giving cogent reasons. That being so, it cannot be said that the findings recorded are perverse, without considering the explanation submitted by the petitioner's. On petitioner's own showing it is clear that the last election to the society was held on 21.4.1997 when late Madhavrao Scindia was elected as President of the society. He expired some time in the year 2001 and after his death on 29.12.2001 Jyotiraditya Scindia was appointed as officiating President. There is no intimation of such a election and nomination made to the Registrar of society as required under Section 27 of the Act. Entire action in the matter is taken not only on the basis of explanation submitted by the petitioner's but also on the basis of the enquiry report annexure R/5 submitted by the Enquiry officer.

43. During the course of enquiry, the entire records were available and petitioners were represented by their counsel Shri K.N. Gupta and secretary Shri Padam Jain. They had submitted detailed arguments and it was only after considering their arguments and the entire contentions that action was taken. While exercising power of judicial review in such matters this Court does not sit as a appellate authority over the decision taken or the order passed. Judicial review in such matters is limited to finding out as to whether the decision has been arrived at reasonably after considering relevant material and is not based on extraneous consideration. Power exercised by the State Govt. under Section 33 of the Adhiniyam can be tested only on the principle of Wednesbury's test of reasonableness. Even in a quasi judicial administrative action as contemplated under Section 33 the action can be subjected to judicial review only, with reference to the broad area of administrative activity and the discretion exercised is to be tested by considering the matter in the light of the arbitrariness or abuse of discretionary power. Interference can be made only if the administrative action is found to be irrational or so outrageous that it totally defies the principles of proportionality, judicial review only to the extent of finding out non application of mind non consideration of relevant facts is permissible. If the conclusion has been reasonably arrived at after taking note of all relevant factors interference into the matter cannot be made by this Court.

44. In the facts and circumstances of the case, taking note of the detailed reasons and analysis of material made by the State Govt. in the order annexure P/1 dated 11.10.05 and in the enquiry report annexure R/5 it is clear that all relevant factors have been taken note of and reasonable justification have been given in the enquiry report and the order for rejecting the defence of the petitioner's. That being so, it cannot be said that action taken in the j; matter is without considering the explanation and reply of the petitioner's.

45. Now, the question of malafides of respondent No. 5 has to be considered. Malafides on the part of respondent No. 5 are attributed because of the following reasons:

i) He had been persistently making efforts to get the governing body legally elected from discharging its duties and to restrain them from taking charge.

ii) He had filed more than three petitions in this Court in furtherance to this intention.

iii) Entire action was taken after respondent No. 5 was elected as M.L.A. in Dec. 2003 and become Minister in the Cabinet.

iv) He had written letter annexure P/58 which considered alongwith the fact that arguments were heard on 7.3.05 and thereafter no order was passed for 7 months shows his malice in the matter.

46. Supreme Court in the case of State of Andhra Pradesh and Ors. v. Goverdhanlal Pitti has considered the legal meaning of malice and in para 12 it has been so observed by the Supreme Court:

The legal meaning of malice is 'ill-will or spite towards a party and any indirect or improper motive in taking an action'. This is sometimes described as 'malice in fact'. 'Legal malice' or 'malice in law' means 'something done without lawful excuse'. In other words. 'It is an act dons wrongfully and wilfully without reasonable or probable cause, and not necessarily an act done from ill feeling and spite. It is deliberate act in disregard of the rights of others.

(Emphasis Supplied)

47. Again in the case of State of Punjab v. V.K. Khanna AIR 2001 SC 343 bias in administrative matter and question of malafide action has been considered and the test for determining apprehension of bias etc. have been so considered by the Supreme Court in para 8 of the aforesaid judgment.

8. The test, therefore, is as to whether there is a mere apprehension of bias or there is a real danger of bias and it is on this score that the surrounding circumstances must and ought to be collated and necessary conclusion drawn therefrom. In the event, however, the conclusion is otherwise that there is existing a real danger of bias administrative action cannot be sustained. If on the other hand allegations pertain to rather fanciful apprehension in administrative action, question of declaring them to be unsustainable on the basis therefor would not arise.

48. The question of bias attributed to respondent No. 5 is, therefore, required to be considered in the light of the aforesaid legal principle. Respondent No. 5 was a member who had subscribed to the formation of the society in the year 1990, Infact, he is a founder Secretary of the society and is one of seven persons who had subscribed to form the society. Therefore, it can be safely construed that he had a interest in the affairs of the society as he had played some role in establishment of the society. That being so, it would be natural for a person interested in the affairs of the society to make endeavour for highlighting the illegality, if any, being committed in the working of the society.

49. Malafides of respondent No. 5 are being highlighted mainly on the ground that entire action was taken after he carne to power and became Minister in the Cabinet in December, 2003 but for this no action would have been taken. Records indicate -that even before respondent No. 5 was elected as a Member of the Legislative Assembly proceedings under Section 32 were initiated on 13.11.2001 and at that point of time the present Govt. according to the petitioner's own showing was not in power. The Govt. which is said to be favourable to the petitioner's society was in power and inspite of this action was initiated and enquiry ordered under Section 32 of the Adhiniyam, 1973 highlighting 30 irregularities committed by the society. After the show cause notice was issued on 13.11.2001 enquiries were conducted on various dates and the enquiry report Annexure R/5 was submitted on 31.7.2002. Even on this date respondent No. 5 was not a Member of the Legislative Assembly or a Minister. Petitioner for reasons which remained unexplained chose not to challenge this enquiry report. It was satisfied with the report and only filed an appeal challenging appointment of Enquiry Officer vide order 13.11.2000. This appeal was dismissed on 06.5.2003 vide Annexure R/7. All these things happened even prior to the general elections were held in the year 2003 in the month of December. In the enquiry report Annexure R/5 30 irregularities establishment of which formed part of the enquiry in the show cause notice Annexure P/2 dated 16.1.2004 and were found to be established. No action was taken by the Govt. into the irregularities established in the enquiry report Annexure R/5 and the matter was kept pending. If the present Govt. after it came to power thought it appropriate to proceed in the matter on the basis of the enquiry report annexure 2/5 and even if it assumed the respondent No. 5 had some role to play in the matter malafides cannot be attributed as respondent No. 5, he being a founder member and founder Secretary of the society would naturally want to highlight the illegalities and to ensure that action is taken in accordance with law. The aforesaid factual aspect of the matter indicates that even before respondent No. 5 was elected as member of the Legislative Assembly and the present Govt. came into power enquiry into the illegalities of the petitioner's society was conducted and proved in the enquiry report annexure R/5 dated 31.7.02 and if this fact is taken note of then merely because further action was taken in the year 2004 that by itself cannot be a ground for attributing malice or bias in the matter. The totality of the circumstances has to be taken note of by this Court while addressing the question of bias and malafides on the part of respondent No. 5. Except for contending that respondent No. 5 is biased and has been instrumental in initiating proceedings no cogent material is produced to substantiate this contention. The material available on record on the contrary indicates that proceedings were initiated in the year 2001 under Section 32 of the Adhiniyam and when the said proceedings were initiated and enquiry was ordered respondent No. 5 and the present Govt. was nowhere in picture. That being so, this Court is unable to accept the contention that the entire action has been taken only after respondent No. 5 was elected to the Legislative Assembly and became a Minister.

50. Reference to the communication annexure P/58 made by respondent No. 5 to his counsel informing his counsel that the governing body of the society is misusing the funds of the society and is spending the huge amounts in litigation. He, therefore, wants the counsel to get some interim orders from the court restraining misuse of the funds of the society. This communication cannot be construed to mean that respondent No. 5 had malafides in the matter. It is a simple communication made by respondent No. 5 to his counsel highlighting his anxiety in the matter of misuse of funds of the society and requesting is counsel to take some remedial legal action in the matter.

51. Considering the totality of the circumstances I find that the grounds of malafides raised in the petition if considered in the backdrop of the principle laid down in the case of V.K. Khanna (supra) does not make out any case attributing malafides to respondent No. 5. Respondent No. 5 being a founder member and Secretary of the society will naturally have some interest in the proper functioning of the society and to see that it discharges its functions in accordance with the law and if in pursuance to this intention he has taken action in the matter his action cannot be said to be tainted with malafides. Accordingly, the grounds of malafides do not find favour with this Court and has to be rejected.

52. Apart from the aforesaid four grounds, another ground which was urged at the time of hearing on behalf of the petitioners were that notice to each and every member of the governing body was not issued, and therefore, action taken without issuing notice to each member of the governing body is said to be unsustainable. In this regard, Shri. R.N. Singh, Learned Advocate General, has brought to the notice of this Court a judgment passed in W.P.3208/04 M.P. State Co-operative Dairy Federation Ltd. v. The Registrar, Co-operative Societies, M.P. Bhopal, wherein also similar grounds in the matter of supersession of a co-operative society was raised and after considering various judgments on the question, it has been held by a Bench of this Court that individual hearing to each member of the society is not necessary if the society is heard in the matter. In the present case also society has been heard and the Secretary of the society was authorized to represent the society. That apart, none of the members of the governing body has raised any grievance with regard to hearing to them in the matter, That being so, on this ground proceedings cannot be said to be illegal.

53. After having considered all these aspects the final consideration to be made is with regard to scope of interference in the matter and the arguments advanced by learned Counsel for the petitioner's to the effect that for such a small default superseding the society is not warranted. As far as the default pointed out is concerned, it cannot be termed as a small minor error or default on the part of the society. The errors pointed out are serious illegalities in the matter of functioning of the society right from the year 1997 and continues upto 2004. The violations are statutory violations as per the Adhiniyam of 1973 and the memorandum of association, bye-laws and rules of the society. That being so, the scope of judicial review in the aforesaid has to be considered in the light of the principles laid down by the Supreme Court in various cases. While considering the scope of judicial review in such matters in the case of Indian Railway Construction Company Limited v. Ajay Kumar , Supreme Court has held as under:

13. One of the points that falls for determination is the scope for judicial interference in matters of administrative decisions. Administrative action is stated to be referable to the broad area of governmental activities in which the repositories of power may exercise every class of statutory function of executive, quasi-legislative and quasi-judicial nature. The authority in which a discretion is vested can be compelled to exercise that discretion, but not to exercise it in any particular manner. In general, a decretion must be exercised only by the authority to which it is committed. That authority must genuinely address itself to the matter before it; it must not act under the dictates of another body or disable itself from exercising a discretion in each individual case. In the purported exercise of its discretion, it must not do what it has been forbidden to do, nor must it do what it has not been authorized to do. It must act in good faith, must have regard to all relevant considerations and must not be influenced by irrelevant considerations, must not seek to promote purposes alien to the letter or to the spirit of the legislation that gives it power to act, and must not act arbitrarily and capriciously. These several principles can conveniently be grouped in two main categories:(i) failure to exercise a discretion, and (ii) excess or abuse of discretionary power.

14. One can conveniently classify under three heads the grounds on which administrative action is subject to control by judicial review. The first ground is 'illegality', the second 'irrationality', and the third 'procedural impropriety'. These principles were highlighted by Lord Diplock in Council of Civil Service Unions v. Minsiter for the Civil Service (1984) 3 All ER 935. If the power has been exercised on a non-consideration or non-application of mind to relevant factors, the exercise of power will be regarded as manifestly erroneous. If a power (whether legislative or administrative) is exercised on the basis of facts which do not exist and which are patently erroneous, such exercise of power will stand vitiated.

15. The Court will be slow to interfere in such matters relating to administrative functions unless decision is tainted by any vulnerability enumerated above: like illegality, irrationality and procedural impropriety. Whether the action falls within any of the categories has to be established. Mere assertion in that regard would not be sufficient.

20. In other words, to characterize a decision of the administrator as 'irrational' the court has to hold, on material, that it is a decision 'so outrageous' as to be in total defiance of logic or moral standards. Adoption of 'proportionality' into administrative law was left for the future.

23. Doubtless, he who seeks to invalidate or nullify any act or order must establish the charge of bad faith, an abuse or a misuse by the authority of its powers. While the indirect motive or purpose, or bad faith or personal ill will is not to be held established except on clear proof thereof, it is obviously difficult to establish the state of a man's mind, for that, is what the employee has to establish in this cases, though this may sometimes be done. The difficulty is not lessened when one has to establish that a person apparently acting on the legitimate exercise of power has, in fact, beer, acting mala fide in the sense of pursuing an illegitimate aim. It is not the law that malafides in the sense of improper motive should be established only by direct evidence. But it must be discernible from the order impugned or must be shown from the established surrounding factors which preceded the order. If bad faith would vitiate the order, the same can, in our opinion, be deduced as a reasonable and inescapable inference from proved facts. It cannot be overlooked that the burden of establishing mala fides is very heavy on the person who alleges it. The allegations of mala fides are often more easily made than proved, and the very seriousness of such allegations demands proof of a high order of credibility. As noted by this Court in E.P. Royappa v. State of T.N. AIR 1974 555, courts would be slow to draw dubious inferences from incomplete facts placed before it by a party particularly when the imputations are grave and they are made against the holder of an office which has a high responsibility in the administration.

54. Recently in the case of Union of India and Ors. v. Flight Cadet Ashish Rai : , power of judicial review into a administrative action under Article 226 of the Constitution was considered by the Supreme Court and it has been so held by the Supreme Court in para 6 of the aforesaid judgment.

6. There should be judicial restraint while making judicial review in administrative matter. Where irrelevant aspects have been eschewed from consideration and no relevant aspect has been ignored and the administrative decisions have nexus with the facts on record, there is no scope for interference. The duty of the court is (a) to confine itself to the question of legality; (b) to decide whether the decision-making authority exceeded its powers; (c) committed an error of law; (d) committed breach of the rules of natural justice; and (e) reached a decision which no reasonable tribunal would have reached; or (f) abused its powers. Administrative action is subject to control by judicial review in the following manner:

(i) Illegality: this means the decision-maker must understand correctly the law that regulates his decision-making power and must give effect to it,

(ii) Irrationality, namely, Wednesbury unreasonableness.

(iii) Procedural impropriety.

55. The scope of judicial review into administrative orders passed has been considered by the Supreme Court in the case of B.C. Charturvedi v. Union of India and Ors. and in the aforesaid case it has been clearly laid down by the Supreme Court that judicial review into orders from administrative in nature is not a appeal from the administrative decision is it review of the manner in which the decision was taken. It has been held by the Supreme Court that power of judicial review in such cases are meant to ensure that the individual receives a fair treatment and it is not to ensure that the conclusion which the authority reaches is necessarily correct in the eye of the court. Once it is established that individual has received a fair treatment, interference in the matter is not called for.

56. If the action taken in the present case is viewed in the backdrop of the legal principles laid down by the Supreme Court in the two cases referred to herein above it has to be held that the action does confirm to the principles of law, the decision making authority has acted within the powers conferred on it under , the law. They have not committed any breach of rules of natural justice and the decision arrived at is based on reasonable apprehension of the material available on record. It can neither be termed as irrational nor is there any procedural impropriety involved in the matter. Again the concept of fairness in administrative action and bias is considered by the Supreme Court in the case of V.K. Khanna (supra). In the aforesaid case Supreme Court in para 2 has held as under:

2. The concept of fairness in administrative action has been the subject matter of considerable judicial debate but there is total unanimity on the basic element of the concept to the effect that the same is dependant upon the facts and circumstances of each matter pending scrutiny before the Court and no straight jacket formula can be evolved therefor. As a matter of fact, fairness is synonymous with reasonableness. And on the issue of ascertainment of meaning of reasonableness, common English parlance referred to as what is in contemplation of an ordinary man of prudence similarly placed - it is the appreciation of this common man's perception in its proper perspective which would prompt the court to determine the situation as to whether the same is otherwise reasonable or not.

57. From the aforesaid observations of the Supreme Court it is clear that the concept of fairness in administrative action depends upon the facts and circumstances of each case which is brought to the scrutiny of the court and for the said purpose no straight jacket formula can be evolved. It has been held by the Supreme Court that, fairness is synonymous with reasonableness and the contemplation of an ordinary man of prudence in the circumstances has to be the perception to appreciate the action taken. In para 5 of the aforesaid judgment Supreme Court has observed as under:

15. Whereas fairness is synonymous with reasonableness - bias stands included within the attributes and broader purview of the word 'malice' which in common acceptation means and implies 'spite' or 'ill will'. One redeeming feature in the matter of attributing bias or malice and is now well settled that mere general statements will not be sufficient for the purposes of indication of ill will. There must be cogent evidence available on record to come to the conclusion as to whether in fact, there was existing a bias or a mala fide move which results in the miscarriage of justice. In almost all legal enquiries, 'intention as distinguished from motive is the all important factor' and in common parlance a malicious act stands equated with an intentional act without just cause or excuse.

58. Taking note of the facts and circumstances of the case in the light of the principles laid down by the Supreme Court as indicated herein above this Court is of the considered view that the action taken in the present case cannot be termed as unreasonable or unfair to such a extent that the administrative action impugned is liable to be quashed on the grounds of malafides or arbitrariness.

59. As far as the question of interfering in the matter of taking the drastic step of superseding the society is concerned, once it is held by this Court that the action taken is reasonable and is not vitiated by any malafides the power to interfere in the discretion exercised by the administrative authority is very limited. In this regard Shri R.N. Singh, learned Advocate General had placed heavy reliance on a judgment of Supreme Court in the case of Parmanand (supra) and if the observations made by the Supreme Court in the aforesaid judgment as contained in para 26 and 27 are taken note of it has to be held that this Court cannot interfere in the matter of discretion exercised by the State Govt. merely on the ground that the action of superseding the society is highly excessive and unwarranted.

60. Accordingly, taking note of the totality of the facts and circumstances of the case I find no ground to interfere in the matter. Accordingly, petition stands dismissed without any order as to cost.