Holding

A society that has invested in a federal cooperative society becomes eligible to vote after three years from the date of investment and, having completed two years of membership, must be included in the provisional list of voters under Rule 4.

Summary

The appellant, Dudhganga Vikas Sewa Santha Maryadit, invested in the shares of the Kolhapur District Central Cooperative Bank Ltd. on 30‑12‑2002 and became a member of that federal society. An election for office‑bearers of the federal society was scheduled for April 2006, but the appellant's name was omitted from the provisional list of voters prepared under Rule 4 of the 1971 Rules. The District Collector held that the appellant was ineligible to vote, a decision affirmed by the Bombay High Court. On appeal, the Supreme Court examined Section 27(3) of the Maharashtra Co‑operative Societies Act, 1960, which allows a society that has invested in a federal society to vote after three years, and Rule 4, which requires a two‑year membership for inclusion in the provisional list. The Court held that the appellant satisfied both the three‑year eligibility under the Act and the two‑year requirement under the Rules, and therefore was entitled to vote and be listed. Consequently, the appeals were allowed, the High Court judgment set aside, and the appellant’s votes were ordered to be counted.

Issues considered

Whether a society that invested in a federal cooperative society is eligible to vote under Section 27(3) of the Maharashtra Co‑operative Societies Act, 1960 after three years from the date of investment.
Whether the same society qualifies for inclusion in the provisional list of voters under Rule 4 of the Maharashtra Specified Co‑operative Societies Election to Committees Rules, 1971, which requires a two‑year membership.
Whether any inconsistency exists between the Act and the Rules, and if so, which provision prevails.

Legislation cited

Maharashtra Co-operative Societies Act, 1960s. 27(3), s. 27(3A)

Subjects

cooperative societiesvoting rightsfederal societyeligibilityprovisional list of votersSection 27Rule 4Maharashtra lawelection

Judgment

DUDHGANGA VIKAS SEWA SANTHA MARY ADIT A
v.
DISTT. COLLECTOR-KOLHAPUR AND ORS.

MAY 2, 2006

[B.P. SINGH AND ALTAMAS KABIR, JJ.] B

Co-operative Societies:

Maharashtra Co-operative Societies Act, I 960-Section 27(3)-
Maharashtra Specified Co-operative Societies Election to Committees Rules, C
1971-Rule 4-Co-operative Society invested its funds in shares of federal
society on 30.12.02 and on the same day enrolled as member-Election of
office bearers of federal society due to be held in 2006-Member of co-
operative society-Voting power-Held: In terms of section 27(3), co-
operative society having completed three years from date of its investment in D
federal society, is entitled to appoint one of its members to vote on its behalf
in affairs of federal society-As per Rule 4, having completed minimum
period of2 years as member from date ofenrollment before the year preceding
the election, the member is eligible to be included in the provisional list of
voters.
E
Appellant-society invested its fund in the shares of a federal society-
respondent No. 2 on 30.12.2002. It enrolled as a member of the federal society
with effect from that very date. Election of the office bearers of the federal
society was due to be held in April, 2006. The name of the appellant society
was not included in the provisional list of voters. District Collector held that
the appellant-society was not eligible to vote in the election due to be held. F
Aggrieved appellant society filed writ petition which was dismissed. Hence
the present appeal.

Allowing the appeals, the Court

HELD: I. On a mere reading of Section 27 of the Maharashtra G
Cooperative Societies Act, 1960 and Rule 4 of the Maharashtra Specified Co-
operative Societies Election to Committees Rules, 1971, it is clear that the
appellant society is eligible to vote under section 27(3) and its name must
also be included in the _provisional list of voters prepared in accordance with
729 H
730 SUPREME COURT REPORTS [2006] SUPP. I S.C.R.

A Rule 4. (736-B-C)
2.1. A mere reading of Section 27 makes it explicit that a society, which
has invested any part of its fund in the shares of a federal society, may appoint
one of its members to vote on its behalf in the affairs of the federal society.
Proviso to sub-Section (3) of Section 27 of the Act lays down the condition of
B eligibility which is to the effect that any new member of a federal society shall
be eligible to vote in the affairs of the federal society only after the completion
of the period of 3 years from the date of its investing any part of its fund in
the shares of such federal society. The period of 3 years is reckoned from
the date of the society investing any part of its fund in the shares of a federal
C society. Sub-Section (3A) of Section 27 of the Act provides that an individual
member of a society shall not be eligible for voting in the affairs of that society
for a period of two years from the date of his enrollment as a member of such
society. The period of 2 years shall be computed from the date of enrollment
of an individual as a member of such federal society. (733-F-H; 734-A(

O 2.2. Appellant society invested its fund in the shares of respondent No.
2 on 30.12.2002. The date of investment by the appellant society and its
enrollment as a member of the federal society is the same, namely, 30.12.2002.
Ex facie, therefore, in terms of Section 27(3) of the Act, in April, 2006 when
the election was due to be held, the appellant society was entitled to appoint
one of its members to vote on its behalf in the affairs of the federal society-
E respondent No. 2, having completed the period of 3 years from the date of its
investment in shares of respondent No. 2 society on 30.12.2005. (734-8-CJ

2.3. Rule 4 of the Rules provides for the preparation of the provisional
list of voters. The provisional list is required to be prepared by every specified
F cooperative society for the year in which general election is due to be held.
According to Rule 4 persons who have completed a minimum period of2 years
as member from the date of their enrollment before 30th June of the year
immediately preceding the year in which such election is due, shall be included
in the said provisional list. The appellant society was enrolled as a member
on 30.12.2002. It completed minimum period of2 years as a member of such
G society as on 30.6.2005, since the election was scheduled to be held in April
2006. In terms of Rule 4 the name of the appellant society was eligible to be
included in the provisional list. [734-E-G I

2.4. Rule 4 does not provide that a person whose name is to be included
in the provisional list of voters should be one who has completed a minimum
H
DUDHGANGA VIKAS SEWA SANTHA MARYADIT "· DISTT. COLLECTOR-KOLHAPUR[B.P. SINGH,J] 73 J

period of 3 years as a member as on 30th June of the year immediately A
preceding the year in which election is due; as such submission of the State
is misconceived. In fact, the express words of Rule 4 provide that he should
have completed minimum period of2 years. To read Rule 4 in the manner
sugge_sted by the respondents would amount to rewriting the rule. It was~
submitted that Rule 4 must be read into Section 27 and so read there may be B
inconsistency between the Act and the Rules. On a careful consideration of
the provisions of the Act and the Rules, it is seen there is no inconsistency
between Section 27 of the Act and Rule 4 of the Rules. Even if there was any
inconsistency the Act must prevail over the Rules. (735-F-G(

2.5. By interim order of this Court appellant society and other similarly C
situated societies were permitted to cast their vote. It is directed that the votes
cast by the appellant society and other similarly situated societies shall be

- counted and the result of the election declared. (736-C-E]

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2_I22 of2006.
D
From the Judgment and Order dated I 2. 1.2006 of the Bombay High
Court in W.P. No. 49/2006.
WITH
2133/06, 2I24/06 and 2125/06.

Shekhar Naphade, Himanshu Gupta and T. Raja for the Appellants. E
Sudhanshu Choudhary, Naresh Kumar, Shivaji M. Jadhav, Murali Patil,
S.S. Shinde and V.N. Raghupathy for the Respondent.

The Judgment of the Court was delivered by

B.P. SINGH, J. In this batch of appeals since the issue involved is F
identical, they are being disposed of by this common judgment and order.

These appeals by special leave impugn the judgment and order of the
High Court ofBombay dated 12.1.2006 in Writ Petition No. 49/2006. The High
Court by its impugned judgment and order dismissed the writ peitions filed
by the appellant-societies and upheld the order of the District Collector G
holding that the appellant-societies were not eligible to vote in the election
which were to be held in the month of April, 2006. The answer to the question
which arises for consideration is dependent upon the interpretation of Section
27(3) of the Maharashtra Cooperative Societies Act, 1960 (hereinafter referred
to as the "Act") and Rule 4 of the Maharashtra Specified Co-operative H
732 SUPREME COURT REPORTS [2006] SUPP. I S.C.R.

A Societies Election to Committees Rules, 1971 (hereinafter referred to as the
"Rules'').

For the sakt: of convenience we are taking the representative facts in
C.A. No. 2122/2006.

B The facts not in dispute are that the appellant-society is a primary
society. It contributed to the capital of a federsal society known as "Kolhapur
District Central Cooperative Bank Ltd."-respondent No.2 herein on 30.12.2002.
It is also not disputed before us that it became a member of the federal society
with effect from that very date. Election of the office bearers of the federal
C society was due to be held in April, 2006 and a question arose as to whether
the appellant society was eligible to be a voter. The controversy arose
because the name of the appellant society was not included in the provisional
list of voters. The matter came for decision before the District Collector who

D
rejected the contention of the appellant society and held that it was not
eligible to vote. Aggrieved by the order of the District Collector, the appellant
society filed the instant writ petition before the High Court which has been
-
dismissed by the impugned judgment and order.

The relevant part of Section 27 of the Act is as follows:-

27. Voting powers of members--{ I) Save as otherwise provided in
E sub-sections (2) to (7), both inclusive, no member of any society shall
have more than one vote in its affairs; and every right to vote shall
be exercised personally, and not by proxy:

Provided that, in the case of an equality of votes the Chairman
shall have a casting vote.
F
(2) ··············

(3) A society, which has invested any part of its funds in the shares
of any federal society. may appoint one of its members to vote on its
behalf in the affaris of that federal society; and accordingly such
G member shall have the right to vote on behalf of the society:

Provided that, any new member society of a federal society shall
be eligible to vote in the affairs of that federal society only after the
completion of the period of three years from the date of its investing
any part of its fund in the shares of such federal society:

H (3A) An individual member of a society shall not be eligible for voting
DUDHGANGA VIKAS SEWA SANTHA MARYADIT v. DISTT. COLLECTOR-KOLHAPUR[B.P. SINGH. J.] 733

in the affairs of that society for a period of two years from the date A
of his enrollment as a member of such society.

(4)to(ll) ........... "

The federsal society being a specified cooperative society, election to
the committees thereof are governed by the Rules. The relevant part of Rule B
4·reads as follows:-

"4. Provisional list of voters-( I) A provisional list of voters shall be
prepared by every society for the year in which general election is due
to be held. The persons who have completed minimum period of two
years as members from the date of their enrollment before 30th June C
of the year immediately preceding the year in which such election is
due shall be included in the provisional list. If different constituencies
are provided in the bye-laws, the names of voters shall be arranged
constituencywise as laid down in the bye-law:

Provided that, if in any case, the preparation of the provisional list D
of voters falls due after the expiry of a period of six months from the
30th June, the Collector may, in consultation with the Registrar in
respect of the societies of the categories mentioned in clauses (i), (v),
(vi) and (vii) of sub-section (1) of Section 73G, and in consulation with
the District Deputy Registrar in respect of the societies the other E
<I.
categories mentioned in sub-section (I) of section 73G, by order,
change the date of the 30th June and subsequent dates and fix revised
dates for the purpose of these rules. "(sic)

A mere reading of Section 27 makes its explicit that a society which has
invested any part of its fund in the shares of a federal society, may appoint F
one of its members to vote on its behalf in the affairs of the federal society.
Proviso to sub-Section (3) of Section 27 of the Act lays down the condition
of eligibility which is to the effect that any new member of a federal society
shall be eligible to vote in the affairs of the federal society only after the
completion of the period of 3 years from the date of its investing any part
of its fund in the shares of such federal society. We may also note sub- G
Section (3A) of Section 27 of the Act which relates to an individual member
of a society. In his case it is provided that he shall not be eligible for voting
in the affairs of that society for a period of two years from the date of his
enrollment as a member of such society. The Legislature has consciously
employed in Sub-Sections (3) and (3A) words which are of significance. In H
734 SUPREME COURT REPORTS [2006] SUPP. I S.C.R.

A the proviso to Sub-Section (3) the period of 3 years is reckoned from the date
of the society investing any part of its fund in the shares of a federal society,
whereas sub-Section (3A) provides that the period of2 years shall be computed
from the date of enrollment of an individual as a member of such federal
society.

B Having regard to the plain word used in Section 27(3) of the Act, the
appellant society having invested its fund in the shares of Kolhapur District
Central Cooperative Bank Ltd. respondent No. 2 herein on 30.12.2002, it
became eligible to vote in the affairs of the federal society after 30.12.2005.
We are informed that the date of investment by the appellant society and its
C enrollment as a member of the federal society is the same, namely, 30.12.2002.
Ex facie, therefore, in terms of Section 27(3) of the Act, in April, 2006 when
the election was due to be held, the appellant society was entitled to appoint
one of its members to vote on its behalf in the affairs of the federal society-
respondent No.2, having completed the period of 3 years from the date of its
investment in shares of the respondent No. 2 society on 30.12.2005.
D
The Collector as well as the High Court have, however, taken the
contrary view relying upon Rule 4 of the Rules. We may in the passing notice
that Section 27(3) of the Act was amended in year 2000 whereas Rule 4 of
the Rules was modified in the year 1971 and thereafter again on 18.2.2002.
Thus, the Act as it stood amended in the year 2000 and the Rules as they
E stood w.e.f. 18.2.2002 are applicable to the case in hand.

Rule 4 of the Rules provides for the preparation of the provisional list
of voters. We may observe that while Section 27 of the Act lays down the
eligibility condition of a new member of a federal society to vote in the affairs
F of a federal society, Rule 4 of the Rules only relates to preparation of a
provisional voters list. The provisional list is required to be prepared by every
specified cooperative society for the year in which general election is due to
be held. According to Rule 4 persons who have completed a minimum period
of 2 years as member from the date of their enrollment before 30th June of
the year immediately preceding the year in which such election is due, shall
G be included in the said provisional list. The question is whether for inclusion
in the provisional list of voters the appellant society fulfilled the conditions
laid down therein, namely, that it had completed minimum period of2 years
as a member of such society as on 30.6.2005, since the election was scheduled
to be held in Apirl, 2006. There is no dispute about the fact that the appellant
H society was enrolled as a member on 30.12.2002, the date on which it invested
DUDHGANGA VIKAS SEWA SANTHA MARYADITv. DISTT. COLLECTOR-KOLHAPUR [B.P. SINGH, J.] 735

its fund in the capital of the respondent No. 2 federal society. We, therefore, A
I.
find no difficulty in holding that in tenns of Rules 4 of the Rules, which relates
to preparation of the provisional voters list, the name of the appellant society
had to be included in the provisional list. So viewed,. under Section 27 of the
Act the appellant society was eligible to vote in the elections to be held in
April, 2006, and was also eligible to be included in the provisional list of B
voters to be prepared in accordance with Rule 4 of the Rules. That being the
legal and factual position, we find no reason to reject the claim of the
appellant society to cast its vote in the election scheduled to be held in April,
2006.

By an interim order of this Court the appellant society as well as other C
similarly situated societies were permitted to cast their votes which were to
be kept in a separate sealed cover and were not to be counted until further
orders.

Learned counsel appearing on behalf of the State of Maharashtra as
well as the intervenors submitted that under Rule 4, though there were no D
express words to that effect, the eligibility of a society for its name to be
included in the provisional voters list has to be considered in the light of the
provisions of Section 27 of the Act. It was, therefore, submitted that unless
a society is a member of the specified society for a period of atleast 3 years
on the 30th of June of the year immediately preceding the year in which such
• election is due, its name cannot be included in the provisional list of voteA.. E
The submission is wholly misconceived. Rule 4 of the Rules does not provide
that a person whose name is to be included in the provisional list of voters
should be one who has completed a minimum period of 3 years as a member
as on 30th June of the year immediately preceding the year in which election
is due. In fact, express words of Rule 4 provide that he should have completed F
minimum period of 2 years. To read Rule 4 in the matter suggested by the
respondents would amount to rewiting the rule. It was submitted that Rule
4 must be read into Section 27 and so read there may be inconsistency
between the Act and the Rules. In fact, the District Collector as well as the
High Court took the view that the District Collector was bound by the Rules
and, therefore, it has rejected the claim of the appellant society. On a careful G
consideration of the provisions of the Act and the Rules, there is no
inconsistency between Section 27 of the Act and Rule 4 of the Rules. Even
if there was any inconsistency as argued by the respondents, the Act must
prevail over the Rules.

The appellant had relied upon a Full Bench decision of the High Court
H
736 SUPREME COURT REPORTS [2006] SUPP. I S.C.R.

A reported in 2005 (2) All Maharashtra Reports, 489. No doubt, the said decision
related to a notified society and not a specified society, and therefore, the
District Collector held that it did not apply to the facts of this case. Technically
speaking, the District Collector may be right, but what was sought to be relied
upon by the appellant was the principle laid down in the aforesaid Full Bench
decision having regard to the similarity of the language of the provisions. It
B is, however, not necessary for us to consider the decision of the Full Bench,
because on a mere reading of Section 27 of the Act and Rule 4 of the Rules,
we are satisfied that the appellant society is eligible to vote under Section 27
(3) of the Act and its name must also be included in the provisional list of
voters prepared in accordance with Rule 4 of the Rules.
c We, therefore, allow these appeals and set aside the impugned judgment
and order of the High Court. Pursuant to the interim order of this Court made
on 6.2.2006, election was held and the appellant society and other similarly
situated societies were permitted to vote, but their votes were kept in a
separate sealed cover and were not to be counted until further orders. By
D subsequent order dated 31.3.2006, we also stayed the counting of votes and
declaration of the result, until further orders.

In view of the fact that we have allowed the appeals today, we direct

-
that the votes cast by the appellant society other similarly situated societies
shall be counted and the result of the election declared.
E
No order as to the costs.

N.J. Appeals allowed.