VIPULBHAI M. CHAUDHARYversusGUJARAT COOPERATIVE MILK MARKETING FEDERATION LIMITED AND OTHERS

                  [2015) 3 S.C.R. 997


             VIPULBHAI M. CHAUDHARY                       A
                           v.
     GUJARAT COOPERATIVE MILK MARKETING
        FEDERATION LIMITED AND OTHERS
                                                          B
          (Civil Appeal No. 3047 of 2015 etc.)

                   MARCH 19, 2015
      [ANIL R. DAVE AND KURIAN JOSEPH, JJ.]
    Cooperative Society:
                                                          c
     Removal of Chairperson/elected office bearer by a
motion of no-confidence in the absence of a specific
provision on removal by no confidence in the Act, Rules
or even Bye-laws of a Co-operative Society - Held: Office D
bearer is liable to be removed in the event of Joss of
confidence by following the same procedure by which he
was elected to office - Gujarat Cooperative Societies Act,
1961 - s. 73, proviso - Constitution of India, 1950 -
Arts.243ZT, 243ZH(b).                                      E
     No confidence motion - Held: There is no uniformity
with regard to the procedure and process regarding motion
of no confidence in local self governments - Having regard
to the set up in local self-governments preva1Jing in many F
of the States as such, in the case of cooperative societies
registered under any Central or State law, a motion of no
confidence against an office bearer should be moved only
after two.years of his assumption of office - Jn case the
motion of no confidence is once defeated, a fresh motion G
shall not be introduced within another one year.
   Laws relating to Cooperative Societies - Historical
background and the legislation - Discussed.
                           997                            H
998         SUPREME COURT REPORTS                   [2015] 3 S.C.R.


·A          Interpretation of statutes: Held: If the statute is silent
      or imprecise on the requirements under the Constitution,
      it is for the court to read the constitutional mandate into
      the provisions concerned and declare it accordingly

B         Dismissing the appeals, the Court

        HELD: 1. If a person has been selected to an
   office through democratic process, and when that
   person looses the confidence of the representatives
c who selected him, those representatives should
   necessarily have a democratic right to remove such an
   office bearer in whom they do not have confidence, in
   case those institutions are viewed under the
   Constitution/statues as democratic institutions. Once
o the cooperative society is conferred a constitutional
   status, it should rise to the constitutional aspirations
   as a democratic institution. So, it is for the respective
   legislative bodies to ensure that there is democratic
   functioning. When the Constitution is eloquent, the
E laws made thereunder cannot be silent. If the statute
 · is silent or imprecise on the requirements under the
   Constitution, it is for the court to read the
   constitutional mandate into the provisions concerned
   and declare it accordingly. Article 243ZT has given a
F period of one year to frame/reframe the statutes in
   consonance with Part IXB and thereafter, i.e., with
   effect from 12.01.2013, those provisions which are
   inconsistent with Part IXB, cease to operate. [Paras 21,
G 25) [1017-C-D; 1019-C-E]

           Bhanumati and Ors. v. State of Uttar Pradesh through
      its Principal Secretary and Ors. (2010) 12 SCC 1: 2010
      (11) SCR240; Pratap Chandra Mehta v. State Bar Council
      of Madhya Pradesh and Ors. (2011) 9 SCC 573: 2011 (11)
H
 VIPULBHAI M. CHAUDHARY v. GUJARAT COOP.                 999
         MILK MARKETING FED. LTD.

SCR965; Usha Bharti v. State of Uttar Pradesh and Ors.    A
(2014) 7 SCC 663: 2014 (4) SCR1076 - distinguished.

    Thompson (Pauper) v. Gold and Co. [1910) A.C. 409
- referred to.
                                                         B
    2. The entire administration, management and
control of the respondent-Federation are vested in the
Board of Directors as per the Bye-law in terms of
proviso to Section 73 of the Gujarat Cooperative
Societies Act, 1961. The Chairperson of the first c
respondent is elected by the Board for a term of three
years and after the 97th Amendment to the Constitution,
the term is five years. When the post of Chairperson
falls vacant, the Board is bound to elect a new
Chairperson for the remaining term. The post of o
Chairperson may fall vacant on account of variety of
reasons like resignation, death or cessation of
membership in the Board, operation of Section 76B of
the Act, i.e., removal by the Registrar on account of
persistent default or misconduct. The removal by no E
confidence is not expressly provided in the Bye-laws.
Neither is there any such provision in the Act or Rules.
The only enabling provision is Bye-law 18.2 which
mandates that in case the office of the Chairperson of
the Federation falls vacant before the expiry of his F
term for any reason, the Board has to elect a new
Chairperson for the remaining term. [Paras 32, 38, 39)
[1023-G; 1026-F-H; 1027-A-B)

    Lakshmanan, President, Thiruvi/wamal Weavers Co- G
operative Society v. II. Vel/iankeri, Member of Board of
Directors, Thiruvilwamala Weavers Co-operative Society
Ltd. and Ors. AIR 2002 Kerala 325; Veeramachaneni
Venkata Narayana v. The Deputy Registrar of Co-operative
societies, Eluru, West Godavari District and Ors. I.LR. H
1000        SUPREME COURT REPORTS              [2015) 3 S.C.R.


 A [1975) A.P. 242; Hindurao Ba/want Patil and Anr. v.
   Krishnaro Pashuram Patil and Ors. AIR 1982 Bombay
   216; Jagdev Singh v. The Registrar, Co-operative
   Societies, Haryana and Ors. AIR 1991 P & H 149 -
   referred to.
 B
        3. Section 26B simply deals with removal for
   misconduct or persistent default/non-performance. A
   person with good conduct may still not earn the
   confidence of the people who selected him to the
 c office. The very concept of cooperation is to work
   jointly towards the same end. Unless there is
   cooperativeness among the elected cooperators who
   constitute the Governing Body for achieving the object
   for which ttie society is constituted and for which
 o those representatives are elected by the members
   entrusting them with the management of affairs of the
   society, there will be total chaos. Cooperation among
   the cooperators is the essence of democratic
   functioning of a cooperative society. If there is no
 E de!llocracy in a cooperative society, it ceases to be a
   cooperative society as conceived by the Constitution
   of India under the 971h Amendment. A right to elect is
   not a fundamental right nor a common law right; it is
   a statutory right, and any question relating to election
 F has to be resorted within the four corners of the Act.
   [Paras 46, 47) [1030-F-H; 1031-A-C]
          Jyoti Basu and Ors. v. Debi Ghosa/ and Ors. (1982)
       1 SCC 691: 1982 (3) SCR 318 - relied on.
 G         Seaford Court Estates v. Asher (1949) 2 All ER 155
       - referred to.
            4. The cooperative registered under the Central or
       the State Act is bound to function as a democratic
       institution and conduct its affairs based on democratic
 H
VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1001
             MARKETING FED. LTD.

principles. Democratic functioning on democratic             A
principles is to be reflected in the respective Acts or
Rules or Bye-laws both on the principle and procedure.
If not, it is for the court to read the democratic
principles into the Act or Rules or Bye-laws. If a
procedure is prescribed in any Act or Rule or By.e-law       B
regarding election of an office bearer by the Board, as
defined under Article 243ZH(b) of the Constitution of
India, and for removal thereof, by way of a motion of
no confidence, the same procedure has to be followed.
In case there is no express provision under the Act. or      C
Rules or Bye-laws for removal of an office bearer, such
office bearer is liable to be removed in the event of loss
of confidence by following the same procedure by
which he was elected to office. [Para 53] [1034-H, 1035-     D
A-D] [1035-F-H; 1036-A-C]
    Rattan Chand Hira Chand v. Askar Nawaz Jung (Dead)
by Lrs. and Ors. (1991) 3 SCC 67: 1991 (1) SCR 327 -
relied on.
                    Case Law Reference                       E

  2010 (11) SCR 240         Distinguished    . Para 18
  2011· (11) SCR 965        Distinguished     Para 19

  2014 (4) SCR 1076         Distinguished     Para 19·       F
  (1910) A.C. 409           referred to       Para 28

  AIR 2002 Kerala 325       referred to       Para 40

  I.LR. (1975) A.P. 242     referred to       Para 41        G

 AIR 1982 Bombay 216        referred to       Para 42

  AIR 1991 P & H 149        referred to       Para 43

  1982 (3) SCR 318          relied on         Para 47        H
1002        SUPREME COURT REPORTS               [2015] 3 S.C.R.


 A       1991 (1) SCR 327          relied on        Para 52

          CIVIL APPELLATE JURISDICTION: Civil Appeal No.
       3047 of 2015 etc.

           From the Judgment and Order dated 10.01.2014 of
 8
       the High Court of Gujarat at Ahmedabad in LPA No. 6 of
       2014 in Civil Application No. 13220 of 2013 in Special
       Application No. 16515 of 2013.

                                WITH
 c
          C. A. Nos. 3048 and 3049 of 2015

           Kapil Sibal, H. Ahmedi, Harin P Raval, Mihir Thakar,
       B. B. Naik, Anip Sachthey, Saakaar Sardana, Rohan
 D Sharma for the Appellant.

        Tushar Mehta, ASG, Dr. Rajeev Dhawan, Ashok Desai,
   Jesal Wahi, Puja Singh, Giss Antony (for Hemantika Wahi),
   Abhijeet Sinha, Dilip Singh Parmar, Bharat S. Patel, Sanjay
 E R. Hegde, Amit M. Panchal, S. Nithin (for Anil Kumar
   Mishra-I), Shamik Sanjanwala, Nandish Chudgar, Kailash
   Pandey, Ranjeet Singh (for K. V. Sreekumar), Purvish
   Jitendra Malkan, B. S. Patel, Pradhuman Gohil., Vikash
   Singh, Taruna Singh Gohil, Jaikriti Singh Jadeja,
 F Prabuddha Sharma, for the Respondents.

          The Judgment of the Court was delivered by
          KURIAN, J. 1. Leave granted.
G         2. Whether in the absence of a specific provision on
     removal by no confidence in the Act, Rules or even Bye-
     laws of a Cooperative Society, the Chairperson/elected
     office bearer can be removed by a motion of no
     confidence, is the short but complex question.
H
 VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1003
        MARKETING FED. LTD. [KURIAN, J.]

    3. Appellant was removed from the office of the A
Chairperson of the first respondent-cooperative society
through a no confidence motion. Aggrieved, appellant filed
a writ petition which was dismissed as per the impugned
judgment and thus the appeal.
                                                           B
    4. Shri Kapil Sibal, Shri H. Ahmedi and Shri Harin P.
Raval, learned Senior Counsel led the arguments on
behalf of the appellant. Shri Tushar Mehta, Additional
Solicitor General, Dr. Rajeev Dhawan, Shri Ashok Desai
and Shri V. Giri, learned Senior Counsel, Shri Sanjay R. c
Hegde and Shri B. S. Patel, learned Counsel, led the
arguments on behalf of the respondents.
    5. International Cooperative Alliance Statement on the
Cooperative Identity was adopted in Manchester, United
Kingdom on 23.09.1995. The 'cooperative' is defined as:      D
    "A co-operative i.s an autonomous association of
    persons united voluntarily to meet their common
    economic, social, and cultural needs and aspirations
    through a jointly-owned and democratically-controlled E
    enterprise."
                              (Emphasis supplied)
     6. The Statement also provides for 'values' on which
cooperatives should model themselves, which reads as         F
follows:
    "Co-operatives are based on the values of self-help,
    self-responsibility, democracy, equality, equity and
    solidarity. In the tradition of their founders, G
    co-operative members believe in the ethical values of
    honesty, openness, social responsibility and caring for
    others."

                                 (Emphasis supplied)
                                                             H
1004        SUPREME COURT REPORTS                  [2015] 3 S.C.R.


 A            7. The Statement further provides for 'seven
       cooperative principles' as guidelines by which the
       cooperatives put their values into practice. Following are
       the principles:

 B         "1st Principle: Voluntary and Open Membership

           Co-operatives are voluntary organizations, open to all
           persons able to use their services and willing to accept
           the responsibilities of membership, without gender,
 c         social, racial, political or religious discrimination.

           2nd Principle: Democratic Member Control

           Co-operatives are democratic organizations controlled
           by their members. who actively participate in setting
 D         their policies and making decisions. Men and women
           serving as elected representatives are accountable to
           the membership. In primary co-operatives members
           have equal voting rights (one member, one vote) and
           co-operatives at other levels are also organized in a
 E         democratic manner.

           3rd Principle: Member Economic Participation

           Members contribute equitably to, and demoqratically
 F         control, the capital of their co-operative. At least part
           of that capital is usually the common property of the
           co-operative. Members usually receive limited
           compensation, if any, on capital subscribed as a
           condition of membership. Members allocate surpluses
 G         for any or all of the following purposes: developing
           their co-operative, possibly by setting up reserves, part
           of which at least would be indivisible; benefiting
           members in proportion to their transactions with the
           co-operative; and supporting other activities approved
 H
VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1005
       MARKETING FED. LTD. [KURIAN, J.]

  by the membership.                                       A

  4th Principle: Autonomy and Independence

  Co-operatives are autonomous, self-help organizations
  controlled by their members. If they enter to
                                                        8
  agreements with other organizations, including ·
  governments, or raise capital from external sources,
  they do so on terms that ensure democratic control by
  their members and maintain their co-operative
  autonomy.                                                c
  5th Principle: Education, Training and Information

  Co-operatives provide education and training for their
  members, elected representatives, managers, and
  employees so they can contribute effectively to the      D
  development of their co-operatives. They inform the
  general public - particularly young people and opinion
  leaders - about the nature and benefits of co-
  operation.
                                                           E
  6th Principle: Co-operation among Co-operatives

  Co-operatives serve their members most effectively
  and strengthen the co-operative movement by working
  together through local, national, regional and           F
  international structures.

  7th Principle: Concern for Community

  Co-operatives work for the sustainable development of
  their communities through policies approved by their G
  members."

                            (Emphasis supplied)

  8. The cooperative movement in India started at the      H
1006      SUPREME COURT REPORTS                [2015] 3 S.C.R.


 A beginning of the 20'h century. Though the movements were
   also based on some of the values and principles stated
   above, it appears that the cooperatives in India did not
   have effective autonomy, democratic functioning and
   professional management. The National Policy on
 B Cooperatives announced by the Department of Agriculture
   and Cooperation, Ministry of Agriculture, Government of
   India adopted in March, 2002, is wholly based on the
   definition, values and principles stated above. 97'h
   Amendment to the Constitution of India, in fact, gave a
 C constitutional frame to this policy.

        9. Apart from providing for the right to form
   cooperative societies to be a fundamental right under
   Article 19 of the Constitution of India and insertion of
 D Article 438 under the Directive Principles of State Policy
   on promotion of cooperative societies, the amendment also
   introduced a new Part IXB on Cooperative Societies.
   Reference to the Statement of Objects and Reasons of the
   amendment would give a clear picture as to the need to
 E strengthen the democratic basis and provide for a
   constitutional status to the cooperative societies. Thus, one
   has to see the constitutional aspirations on the concept of
   cooperative societies after the 97'h Amendment in the
 F Constitution of India which came into effect on 12.01.2012.

        "STATEMENT OF OBJECTS AND REASONS

        The co-operative sector, over the years, has made
        significant contribution to various sectors of national
G       economy and has achieved voluminous growth.
        However, it has shown weaknesses in safeguarding
        the interests of ihe members and fulfilment of objects
        for which these institutions were organised. There
        have been instances where elections have been
 H      postponed indefinitely and nominated office bearers or
VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1007
       MARKETING FED. LTD. [KURIAN, J.]

  administrators remaining in-charge of these institutions A
  for a long time. This reduces the accountability of the
  management of co-operative societies to their
  members. Inadequate professionalism in management
  in many of the co-operative institutions has led to poor
  services and low productivity. Co-operatives need to B
  run on well established democratic principles and
  elections held on time and in a free and fair manner.
  Therefore, there is a need to initiate fundamental
  reforms to revitalize these institutions in order to
  ensure their contribution in the economic development C
  of the country and to serve the interests of members
  and public at large and also to ensure their autonomy,
  democratic functioning and professional management.

  2. The "co-operative societies" is a subject enumerated    D
  in Entry 32 of the State List of the Seventh Schedule
  of the Constitution and the State Legislatures have
  accordingly enacted legislations on co-operative
  societies. Within the framework of State Acts, growth
  of co-operatives on large scale was envisaged as part      E
  of the efforts for securing social and economic justice
  and equitable distribution of the fruits of development.
  It has, however, been experienced that in spite of
  considerable expansion of co-operatives, their             F
  performance in qualitative terms has not been up to
  the desired level. Considering the need for reforms in
  the Co-operative Societies Acts of the States,
  consultations with the State Governments have been
   held at several occasions and in the conferences of       G
  State Co-operative Ministers. A strong need has been
  felt for amending the Constitution so as to keep the
  co-operatives free from unnecessary outside
   interferences and also to ensure their autonomous
  organisational set up and their democratic functioning.    H
1008    SUPREME COURT REPORTS                 [2015) 3 S.C.R.


 A     3. The Central Government is committed to ensure
       that the co-operative societies in the countrv function
       in a democratic, professional, autonomous and
       economically sound manner. With a view to bring the
       necessary reforms, it is proposed to incorporate a new
 8     Part in the Constitution so as to provide for certain
       provisions covering the vital aspects of working of co-
       operative societies like democratic, autonomous and
       professional functioning. A new article is also proposed
       to be inserted in Part IV of the Constitution (Directive
 c     Principles of State Policy) for the States to endeavour
       to promote voluntary formation, autonomous
       functioning, democratic control and professional
       management of cooperative societies. The proposed
       new Part in the Constitution, inter alia, seeks to
 D
       empower the Parliament in respect of multi-State co-
       operative societies and the State Legislatures in case
       of other co-operative societies to make appropriate
       law, laying down the following matters, namely:-
 E       ( a) provisions for incorporation, regulation and
         winding up of co-operative societies based on the
       · principles of        democratic member-control,
         member-economic participation and autonomous
         functioning;
 F
         (b) specifying the maximum number of directors of
         a co-operative society to be not exceeding twenty-
         one members;

G        (c) providing for a fixed term of five years from the
         date of election in respect of the elected members
         of the board and its office bearers;

         (cf) providing for a maximum time limit of six months
 H       during which a board of directors of co-operative
VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1009
       MARKETING FED. LTD. [KURIAN, J.]

      society could be kept under supersession or A
      suspension;

      (e) providing for independent professional audit;

      (f) providing for right of information to the members
                                                              8
      of the co-operative societies;

      (g) empowering the State Governments to obtain
      periodic reports of activities and accounts of co-
      operative societies;
                                                              c
      (h) providing for the reservation of one seat for the
      Scheduled Castes or the Scheduled Tribes and two
      seats for women on the board of every co-operative •
      society, which have individuals as members from
      such categories;                                      D

      (t) providing for offences relating to co-operative
      societies and penalties in respect of such offences.

      4. It is expected that these provisions will not only E
      ensure the autonomous and democratic functioning
      of co-operatives. but also ensure the accountability
      of management to the members and other
      stakeholders and shall provide for deterrence for
      violation of the provisions of the law.               F
      5. The Bill seeks to achieve the above objectives."

                               (Emphasis supplied)

    10. Article 438 of the Constitution of India provides for G
promotion of cooperative societies:

    "438. The State shall endeavour to promote voluntarv
    formation. autonomous functioning, democratic control
    and professional management of co-operative H
1010      SUPREME COURT REPORTS                 [2015) 3 S.C.R.


 A      societies."

                                      (Emphasis supplied)

        11. Part IXB of the Constitution of India is titled as
 B ''The Cooperative Societies". A few provisions would be
   relevant for our consideration.

           Article 243ZH(b) defines "board":

                  "243ZH(b) "board" means the board of
 C        directors or the governing body of a co-operative
          society, by whatever name called, to which the
          direction and control of the management of the
          affairs of a society is entrusted to;"

 D                                    (Emphasis supplied)

          Article 243ZH(c) defines "cooperative society":

                 "243ZH(c) "co-operative society" means a
          society registered or deemed to be registered under
 E        any law relating to co-operative societies for the time
          being in force in any State;"

          "Office bearer" is under Article 243ZH(e):

 F               "243ZH(e) "office bearer" means a President,
          Vice-President, Chairperson, Vice-Chairperson,
          Secretary or Treasurer of a co-operative society and
          includes any other person to be elected by the
          board of any co-operative society;"
 G
          Article 243ZJ provides for the number and term of
          members of the board and its office bearers:

               "243ZJ. (1) The board shall consist of such
          number of directors as may be provided by the
 H
VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1011
       MARKETING FED. LTD. [KURIAN, J.]
    Legislature of a State, by law:                          A

            Provided that the maximum number of
    directors of a co-operative society shall not exceed
    twenty-one:
                                                            B
           Provided further that the Legislature of a
    State shall, by law, provide for the reservation of one
    seat for the Scheduled Castes or the Scheduled·
    Tribes and two seats for women on board of every
    co-operative society consisting of individuals as C
    members and having members from such class or
    category of persons.

           (2) The term of office of elected members of
    the board and its office bearers shall be five years
                                                         0
    from the date of election and the term of office
    bearers shall be coterminous with the term of the
    board:

           Provided that the board may fil~ a casual
    vacancy on the board by nomination out of the E
    same class of members in respect of which the
    casual vacancy has arisen, if the term of office of
    the board is less than half of its original term.

           (3) The Legislature of a State shall, by law, F
    make provisions for co-option of persons to be
    members of the board having experience in the field
    of banking, management, finance or specialization in
    any other field relating to the objects and activities
    undertaken by the co-operative society as members G
    of the board of such society:

           Provided that the number of such co-opted
    members shall not exceed two in addition to twenty-
    one directors specified in the proviso to clause (1 ):   H
1012      SUPREME COURT REPORTS                  (2015) 3 S.C.R.


 A                 Provided further that such co-opted members
           shall not have the right to vote in any election of the
           co-operative society in their capacity as such
           member or to be eligible to be elected as office
           bearers of the board:
 B
                   Provided also that the functional directors of
           a co-operative society shall also be the members of
           the board and such members shall be excluded for
           the purpose of counting the total number of directors
 C         specified in first proviso of clause (1 )."

                  (Emphasis supplied)

           Article 243ZT provides for continuance of the
           existing laws:
 D
                   "243ZT. Notwithstanding anything in this Part,
           any provision of any law relating to co-operative
           societies in force in a State immediately before the
           commencement of the Constitution (Ninety Seventh
 E         Amendment) Act, 2011, which is inconsistent with
           the provisions of this Part. shall.continue to be in
           force until amended or repealed by a competent
           Legislature or other competent authority or until the
           expiration of one year from such commencement.
 F
           whichever is less.'."

                                       (Emphasis supplied) ·

        12. Thus, by 12.01.2013, all laws on cooperative
 G societies were bound to be restructured in consonance
   with the Ninety Seventh Amendment of the Constitution of
   India and, in any case, any provision in the Act or Rules
   or Bye-laws otherwise inconsistent with the Constitution will
   be inoperative thereafter. Articles 438 and 243ZT are
 H mandates to all the States and the competent authorities .
 VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1013
        MARKETING FED. LTD. [KURIAN, J.)

to structure cooperative societies as conceived in the A
Constitution of India, if not already there. Therefore, we
have to see whether the Act, Rules or Bye-laws contain
any provision for democratic functioning.

      13. The first legislation on cooperative movement in B
India was the Cooperative Credit Societies Act, 1904 and,
thereafter, the cooperative societies emerged in India as
State sponsored/promoted institutions. The main objective
was only credit intended to relieve the poor agriculturists
from the clutches of moneylenders. The first urban. C
cooperative credit society under the Act of :1904 was
registered in Kanjivaram in erstwhile Madras province1• The
traits of democracy were present in the very first legislation
through the principle "one man, one vote". Since the first
legislation was limited to the credit societies, a new D
legislation was introduced 8 years later as "Cooperative
 Societies Act, 1912". The restriction regarding registration
limited to credit societies was taken away and any society
established with the object of promoting the economic
interests of its members i.n accordance with the E
cooperative principles, or a society established with the
object of facilitating the operations of such a society, could
be registered 2 •

    14. Under the Government of India Act of 1919 F
(Montague Chelmsford Reforms), cooperation became a
provincial subject which gave a further impetus to the
movement. This gave birth to several cooperative land
1 "Brief History of Urban Cooperatives" adapted from a paper by O.P.        G
    Sharma published on Reserve Bank of India website

- www.rbi.org.in/scripts/briefhistory.aspx.

2 The Co-operative Movement in India by Eleanor M. Hough, Fourth Edition,
    1959                                                                    H
1014      SUPREME COURT REPORTS                [2015] 3 S.C.R.


. A mortgage banks. The first of its kind was registered in
    Punjab. Close to independence and thereafter, we see a
    radical change and increased growth in the cooperative
    movement. Activities were spread to all spheres of human
    endeavour, and thus in 2002, National Policy on
  B Cooperatives was announced.

        15. The cooperative societies having been conferred
   a constitutional status by the Ninety Seventh Amendment,
   the whole concept of cooperatives has undergone a major
 C change.· In 1993, the local self.governments, viz.,
   panchayats and municipalities were also given
   constitutional status under Parts IX and IXA of the
   Constitution of India by the 73'd and 74'" Amendments. The
   Statement of Objects and Reasons would show that the
 D Constitution wanted the local bodies to function as vibrant
   democratic units of self-government. After two decades,
   cooperative societies were given the constitutional status
   by including them under Part IXB. The main object for the
   said amendment was also to ensure "their autonomy,
 E democratic functioning and professional management".

        16. The National Policy on Cooperatives announced
   in March 2002 has recognized democracy, equality, equity
   and solidarity as values of cooperatives. Cooperative
 F society has been declared as a democratic institution.
   Democratic principles have all through been recognized as
   one of the cooperative principles though the constitutional
   affirmation of those principles came only in 2012.

G      17. The principle of representative democracy is the
  election of representatives by the people otherwise eligible
  to caste their vote and the people thus elected, constituting
  the body for the management of an institution. Thus, in the
  case of cooperative societies, after the amendment in the
H Constitution, there has to be a Board of elected
 VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1015
        MARKETING FED. LTD. [KURIAN, J.)

representatives, which may be called Board of Directors or    A
Governing Body or a Managing Committee, etc., to which
the members entrust the direction and control of the
management of the affairs of the society. That
representative body selects one among the elected
representatives as its Chairman or any other office bearer,   B
as the case may be. Selection is the act of carefully
choosing someone as the most suitable to be the leader
or office bearer. Thus, there is a mt of difference between
election of delegates/representatives to constitute a body
and selection of a person by the body from amongst the        C
elected members to be the leader. It is to be borne in mind
that the management and control of the society is
entrusted to the representative body, viz., the Board of
Directors and that the Chairperson elected by the Board       D
of Directors is the Chairperson of the society and not of
the Board of directors.

    18. In Bhanumati and others v. State of Uttar
Pradesh through its Principal Secretary and others 3 ,
the cooperative principles governing democratic institutions E
have been discussed in detail; no doubt while dealing with
the Panchayati Raj institutions. However, the basic
democratic principles governing .both the institutions,
enjoying the constitutional status, are the same and, F
therefore, it would be profitable to refer to the discussion
on the principles. To quote:

    "58. These institutions must run on democratic
    principles. In democracy all persons heading public
    bodies can continue provided they enjoy the G
    confidence of the persons who comprise such bodies.
    This is the essence of democratic republicanism. This

 3 (2010) 12 sec 1                                            H
1016         SUPREME COURT REPORTS                 [2015) 3 S.C.R.


 A         explains why this provision of no-confidence motion
           was there in the Act of 1961 even prior to the Seventy-
           third Constitution Amendment and has been continued
           even thereafter. Similar provisions are there in different
           States in India.
 B
           66. Democracy demands accountability and
           transparency in the activities of the Chairperson
           especially in view of the important functions entrusted
           with the Chairperson in the running of Panchayati Raj
 c         institutions. Such duties can be discharged by the
           Chairperson only if he/she enjoys the continuous
           confidence of the majority members in the panchayat.
           So any statutory provision to demonstrate that the
           Chairperson has lost the confidence of the majority is
 D         conducive to public interest and adds strength to .such
           bodies of self-governance. Such a statutory provision
           cannot be called either unreasonable or ultra vires Part
           IX of the Constitution."
 E      19. In Pratap Chandra Mehta v. State Bar Council
   of Madhya Pradesh and others 4 and in Usha Bharti v.
   State of Uttar Pradesh and others~. the concept of
   democratic principles governing the democratic institutions
   have been discussed. In a democratic institution,
 F confidence is the foundation on which the superstructure
   of democracy is built. The bedrock of democratic
   accountability rests on the confidence of the electorate. If
   the representative body does not have confidence in the
   office bearer whom they selected, democracy demands
 G such officer to be removed in a democratic manner.
           20. A cooperative society is registered on cooperative
       4 c2011i 9 sec 573

 H     s c2014) 1 sec es3
VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1017
       MARKETING FED. LTD. [KURIAN, J.)

principles of democracy, equity, equality and solidarity. A
Democratic accountability, mutual trust, fairness,
impartiality, unity or agreement of feeling among the
delegates, cooperativeness, etc., are some of the cardinal
dimensions of the cooperative principles. A body built on
such principles cannot be led by a captain in whom the co- B
-;ailors have no confidence.

     21. If a person has been selected to an office through
democratic process, and when that person looses the
confidence of the representatives who selected him, those C
representatives should necessarily have a democratic right
to remove such an office bearer in whom they do not have
confidence, in case those institutions are viewed under the
Constitution/statues as democratic institutions.
                                                            D
     22. In Bhanumati case (supra), at pwagraph-67, this
Court elaborated on this principle:

    "67. Any head of a democratic institution must be
    prepared to face the test of confidence. Neither the E
    democratically elected Prime Minister of the country
    nor the Chief Minister of a State is immune from such
    a test of confidence under the Rules of Procedure
    framed under Articles 118 and 208 of the Constitution.
    Both the Prime Minister of India and Chief Ministers F
    of s~~eral States heading the Council of Ministers at
    the Centre and in several States respectively have to
    adhere to the principles of collective responsibilities to
    their respective houses in accordance with Articles
    75(3) and 164(2) of the Constitution."                     G

    23. In Pratap Chandra Mehta case (supra), at
paragraph-45, the principle has been discussed as follows:

    "45. In the instant case, the election process as         H
1018        SUPREME COURT REPORTS                [2015] 3 S.C.R.


 A        contemplated under the relevant laws is that the
          members of a State Bar Council are elected by the
          electorate of advocates on the rolls of the State Bar
          Council from amongst the electorate itself. The elected
          members then elect a Chairman, a Vice-Chairman and
 B        the Treasurer of the State Bar Council as well as
          constitute various committees for carrying out different
          purposes under the provisions of the Advocates Act.
          In other words, the body which elects the Chairman or
          Vice-Chairman of a State Bar Council always consists
 c        of members elected to that Council. The democratic
          principles would require that a person who attains the
          position of a Chairman or Vice-Chairman, as the case
          may be, could be removed by the same electorate or
          smaller body which elected them to that position by
 D
          taking recourse to a "no-confidence motion" and in
          accordance with the Rules. The body that elects a
          person to such a position would and ought to have the
          right to oust him/her from that post, in the event the
 E        majority members of the body do not support the said
          person at that time. Even if, for the sake of argument,
          it is taken that this may not be generally true, '.:the
          provisions of Rule 122-A of the M.P. Rules make it
          clear, beyond doubt, that a "no-confidence motion" can
 F        be brought against the elected Chairman provided the
          conditions stated in the said Rules are satisfied."

           24. In Usha Bharti case (supra) also, this Court
       eloquently held at paragraph-53 as follows:
 G        "53. In our opinion, the provision for removing an
          elected representative such as Panchayat Adhyaksha
          is of fundamental importance to ensure the democratic
          functioning of the Institution as well as to ensure the
          transparency and accountability in the functions
 H
             \


 VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1019
        MARKETING FED. LTD. [KURIAN, J.]

    performed by the elected representatives."                  A

     25. No doubt, in the cases referred to above, the
respective Acts contained a provision regarding no
confidence. What about a situation where there is no
express provision regarding no confidence? Once the B
cooperative society is conferred a constitutional status, it
should rise to the constitutional aspirations as a democratic
institution. So, it is for the respective legislative bodies to
ensure that there is democratic functioning. When the
Constitution is eloquent, the laws made thereunder cannot C
be silent. If the statute is silent or imprecise on the
requirements under the Constitution, it is for the court to
read the constitutional mandate into the provisions
concerned and declare it accordingly. Article 243ZT has
given a period of one year to frame/reframe the statues in D
consonance with Part IXB and thereafter, i.e., with effect
from 12.01.2013, those provisions which are inconsisterit
with Part IXB, cease to operate.
                 -
    26. Silence in Constitution and abeyance as well has        E
been dealt extensively GY Michael Foley in his celebrated
work "The Silence of ·constitutions". To quote from the
Preface:
                                                                     •
    "Abeyances refer to those constitutional gaps which F
    remain vacuous for positive and constructive
    purposes. They are not, in any sense, truces between
    two or more defined positions, but rather a set of
    implicit agreements to collude in keeping fundamental
    questions of political authority in a state of irresolution. G
    Abeyances are, in effect, compulsive hedges against
    the possibility of that which is unresolved being
    exploited and given meanings almost guaranteed to
    generate profound division and disillusionment.
    Abeyances are important, therefore, because of their H
                                                    I


    1020      SUPREME COURT REPORTS                     [2015] 3 S.C.R.


     A       capacity to deter the formation of conflicting positions
             in just those areas where the potential for conflict is
             most acute. So central are these abeyances, together
             with the social temperament required to sustain them,
             that when they become the subject of heightened
     B       interest and subsequent conflict, they are not merely
             accompanied by an intense constitutional crisis, they
             are themselves the essence of that crisis."

            27. In Part II, Chapter Four, the author has also dealt
     C with the constitutional gaps and the arts of prerogative. To
       the extent relevant, it reads as follows (Page-82):

             "Gaps in a constitution should not be seen as simply
               ~


             empty space. They amount to a substantial plenum of
     D       strategic content and meaning vital to the preservation
             of a constitution. Such interstices accommodate the
             abeyances within which the sleeping giants of
             potentially acute political conflict are communally
             maintained in slumber. Despite the absence of any
     E       documentary or material form, these abeyances are
             real, and are an integral part of any co.nstitution. What
             remains unwritten and indeterminate can be just as
             much responsible for the operational character and
•            restraining quality of a constitution as its more tangible
     F       and codified components. .. . "

           28. Where the Constitution has conceived a particular
       structure on certain institutions, the legislative bodies are
       bound to mould the statutes accordingly. Despite the
     G constitutional mandate, if the legislative body concerned
       does not carry out the required structural changes in the
       statutes, then, it is the duty of the court to provide the
       statute with the meaning as per the Constitution. .. . "The
       job of the Supreme Court is not to expound the meaning
     H
 VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1021
        MARKETING FED. LTD. [KURIAN, J.]

of the constitution but to provide it with meaning" 6• The                A
reference obviously is to United States Supreme Court. As
a general rule of interpretation, no doubt, nothing is to be
added to or taken from a statute. However, when there are
adequate grounds to justify an inference, it is the bounden
duty of the court to do so. . .. "It is a corollary to the                B
general rule of literal construction that nothing is to be
added to or taken from a statue unless there are adequate
grounds to justify the inference that the legislature intended
something which it omitted to express"7 • According to Lord
Mersey in Thompson (Pauper) v. Goold and Co. 8 ... "It is                 C
a strong thing to read into an Act or Parliament words,
which are not there, and in the absence of clear necessity,
it is wrong to do". In the case of cooperative societies, after
the Ninety Seventh Amendment, it has become a clear or                    D
strong necessity to do the strong thing of reading into the
legislation, the constitutional mandate of the cooperative
societies to be governed as democratic institutions. . ..
"The constitutional provisions have to be construed broadly
and liberally having regard to the changed circumstances                  E
and the needs of time and polity"9•

     29. Article 243ZT of the Constitution requires the laws
relating to cooperative societies in force in States prior to
the commencement of the Amendment Act to be in tune                       F
with and in terms of the constitutional concept and set up

6 Walter Berns, 'Government by lawyers and judges',Commen!aty, June,
    1987 at p.18.
7 Maxwell on The Interpretation of Statues, Twelfth Edition, page-33.     G
 [1910] A.C. 409.
8 Constitutional Bench decision in State of West Bengal and others v.
9 Committee for Protection of Democratic Rights. West Bengal and others

 reported in [(2010) 3 SCC 571, Paragraph-45.                             H
1022         SUPREME COURT REPORTS                 [2015] 3 S.C.R.


 A of cooperative societies. In fact, a period of one year has
   been provided in the Constitution from the commencement
   of the amendment for the required amendment or repeal.
   by the competent legislature or by the competent authority,
   of laws which are incomristent with Part IXB. As a corollary,
 B the Constitution enables the competent legislature or
   authority to suitably amend the existing provisions in their
   laws in tune with the constitutional mandate. Thereafter, in
   case there continues to be silence in the Act or Bye-laws,
   the court will have to read the constitutional requirements
 C into the existing provisions. It is essentially a process of
   purposive construction of the available provisions as held
   by this Court in Pratap Chandra Mehta
   case (supra).
 D         30. Bye-law 18.2 of the first respondent, pertaining to
       the office of the Chairperson of the Federation falling
       vacant before the expiry of his elected term, will have to
       be analysed in the light of the above principle. The
       provision reads as follows:
 E
           "18.2.    The Chairperson of the Federation will be
           elected by the Board for the Term of three years and
           he I she shall continue to hold his I her office till the
           new Chairperson is elected and takes over. He I she·
 F         shall be honorary Chairperson. In case the elected
           Chairperson vacates his I her office before expirv of
           his I her term or due to any other reason the post of
           Chairman falls vacant. the Board shall elect the new
           Chairperson for the remaining term.
G
            The election of the Chairperson will take place in· the
            first Board meeting of the Federation after the expirv
            of the term of the elected Chairperson or when the
          · Chairperson's post falls vacant. In his I her absence,
H           the meeting shall elect its own Chairperson for that
 VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1023
        MARKETING FED. LTD. [KURIAN, J.]

    meeting from amongst the eligible members present. A
    The Chairperson in such event shall exercise such
    power as may be delegated to him by the Board of
    Directors. The Managing Director of the Federation
    shall not be entitled to vote and contest the election
    for the post of Chairperson."                          B

                                 (Emphasis supplied)

    31. Bye-law 23 deals with the powers of the Board of
Directors:                                                  c
    "23. Powers and Functions of the Board
    The entire administration, management and control of
    the Federation shall be vested in the Board of
    Directors. The Board of Directors shall have and D
    exercise all such powers and enter into all such
    agreements made, all such arrangements, take all
    such proceeding and do all such acts and things as
    may be necessary or proper for the due management
    of the Federation and for carrying out objects for which E
    the Federation is established and for securing and
    furthering its interest subject to the provisions of the
    Act or such act as shall hereafter take its place and
    to any rules which may be passed by the State
    Government in pursuance of the said Act and subject F
    also to these Bye-Laws and I or any Bye-law which
    may be duly made by the Federation."
    32. Thus, the entire administration, management and
control of the Federation are vested in the Board of
Directors as per the Bye-law. This is in terms of proviso G
to Section 73 of the Gujarat Cooperative Societies Act,
1961 (hereinafter referred to as "the Act"). The Section
reads as follows:
    "Section 73 :- Final authority of society - Subject H
1024        SUPREME COURT REPORTS                (2015] 3 S.C.R.


 A        to the provisions in this Act and the rules, the final
          authority of every society shall vest in the general
          body of the members in general meeting, summoned
          in such a manner as may be specified in the bye-laws:

 B           Provided that, where the bye-laws of a society
          provide for the election of delegates of such members,
          the final authority may vest in the delegates of such
          members elected in the prescribed manner, and
          assembled in general meeting."
 c
            33. The General Body of the first respondent-
       Federation, in terms of Bye-law 13.1 comprises of the
       following:

        "13.1 The General Meeting shall consist of the following:-
 D
        (1) The Chairman of each of the affiliated Milk Unions
            enrolled as Ordinary Members;

        (2) The Registrar;
 E
        (3) The Dairy Management Expert co-opted by the
            Board;

        (4) Managing Director of the Federation;

 F      (5) A nominee of the National Dairy Development
            Board as long as the loan I interest of the National
            Dairy Development Board have not been fully repaid
            by the Federation.

 G         The Chairman of the Board of Directors shall preside
            over the General Meeting. In case of his absence,
            the meeting shall elect a Chairman from among the
            members present."

H         34. The composition of the Board of Directors of the
 VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1025
        MARKETING FED. LTD. [KURIAN, J.]

first respondent-Federation is provided under Bye-law 18.1: A

  "18.1 The Board will consist of the following:

  (i)     Chairman of the affiliated milk unions enrolled as
          ordinary members;
                                                                    B
  (ii)    Registrar or his representative not below the rank
          of Joint Registrar [C.S.];

  (iii) One Dairy Management Expert to be co-opted by
          ~B~;                                                      C
  (iv) Managing Director of the Federation [ex-officio];

  (v) A nominee of the National Dairy Development
      Board as long as the loan I interest of the National D
      Dairy Development Board have not been fully repaid
      by the Federation."

         35. "Committee" is defined under Section 2(5) of the
Act:
                                                                    E
     "Section 2(5) "committee" means the Managing
     Committee or other governing body of a society to
   · which the direction and control of the management of
     the affairs of a society is entrusted to."
                                                                    F
         36. "Officer" is defined under Section 2(14) of the Act:

        "Section 2(14) "officer" means a person elected or
        appointed by a society to any office of such society
        according to its bye-laws; and includes a chairman, G
        vice-chairman, president, vice-president, managing
        director, manager, secretary, treasurer, member pf the
        committee, and any other person elected or appointed
        under this Act, the rules or the bye-laws, to give
        directions in regard to the business of such society." H
1026        SUPREME COURT REPORTS                     [2015] 3 S.C.R.


 A         37. Section 4 of the Act provides for the registration
       of societies:

           "Section 4- Societies which may be registered - A
           society, which has as its object the promotion of the
 B         economic interests or general welfare of its members
           or of the public, in accordance with co-operative
           principles, or as society established with the object of
           facilitating the operations of any such society, may be
           registered under this Act:
 c
           Provided that it shall not be registered if, in the opinion
           of the Registrar, it is economically unsound, or its
           registration may have an adverse effect upon any
           other society, or it is opposed to, or, its working is likely
 D         to be in contravention of public policy."

        38. A conjoint reading of all the provisions under the
   Act and the Bye-laws of the Society would clearly show
   that the functional authority of the first respondent-
                                                       , '
 E Federation vests in the Board of Directors. The entire
   administration, management and control of the Federation
   is with the Board. Thus, the Board of Directors is bound
   to do all such acts and things as may be necessary for the
   proper management of the Federation. The Chairperson of
 F the first respondent is elected by the Board for a term of
   three years and after the 97'h Amendment to the
   Constitution, the term is five years. When the post of
   Chairperso" falls vacant, the Board is bound to elect a
   new Chairperson for the remaining term. The post of
 G Chairperson may fall vacant on account of variety of
   reasons like resignation, death or cessation of membership
   in the Board, operation of Section 76B of the Act, i.e.,
   removal by the Registrar on account of persistent default
   or niisconduct.
 H
 VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1027
        MARKETING FED. LTD. [KURIAN, J.]

    39. The removal by no confidence is not expressly A
provided in the Bye-laws. Neither is there any such
provision in the Act or Rules. The only enabling provision
is Bye-law 18.2 which mandates that in case the office of
the Chairperson of the Federation falls vacant before the
expiry of his term for any reason, the Board has to elect B
a new Chairperson for the remaining term.

     40. Shri Kapil Sibal, learned Counsel appearing for the
appellant, inviting reference to the doctrine of casus
omissus and placing reliance on the Full-Bench decision C
of the High Court of Kerala in S. Lakshmanan, President.
Thiruvilwamal Weavers Co-operative Society v.
V.Velliankeri, Member of Board of Directors.
Thiruvilwamala Weavers Co-operative Society Ltd. and
others 10 and the decisions of. the other High Courts D
submits that no such power of removal of the Chairperson
by no confidence can be read into the provisions of the
Act, · Rules       or     Bye-laws.     To    quote     from
S. Lakshmanan case (supra) :
                                                              E
     "16. The Committee is elected by following the
     procedure prescribed under the Act and the Rules and
     is guaranteed a tenure as prescribed in the Bye-laws,
     by virtue of Rule 39(1). It can only be removed by the
     procedure prescribed in the Act or the Rules or the F
     Bye-laws. The only contingency under which the
     Committee may be removed before the end of its
     tenure is indicated in Section 33(1) of the Act. Section
     ~ of the Act envisages the passing of a no-
     confidence motion by the General Body which results G
     in wholesale removal of the Committee. Barring this
     provision, there is no other provision by which an
     elected individual member of the Committee. can be
10 AIR 2002 Kerala 325                                       H
1028          SUPREME COURT REPORTS                [2015) 3 S.C.R.


 A          removed. We are, therefore, unable to accept the
            contention of the appellants that such a drastic power
            can be read into the Act, even where there are no
            provisions .... "

 B         41. In Veeramachaneni Venkata Narayana v. The
       ,Deputy Registrar of Co-operative societies. Eluru, West
       Godavari District and others 11 , at paragraphc10, the view
       taken by the High Court of Andhra Pradesh, is as under:
            "10. ... As sufficient safeguards are provided in the
 c          event of an office-bearer of the committee not
            conducting himself properly or not discharging his
            duties as required of him under the provisions of the
            Act, the Rules and the bye-laws, the Legislature
            obviously did not intend to provide for the removal of
 D
            an office-bearer of a committee by way of passing of
            'no-confidence' motion against him."
         42. In Hindurao Balwant Patil and another
   v. Krishnaro Pashuram Patil and others 12 , the High
 E Co1,.1rt of Bombay took the view that:
            "10.... The Act, Rules and the bye-laws do no confer
            any right upon the members of the Board of Directors
            to remove the Chairman and the Vice-Chairman by
            passing a mere vote of no confidence. Therefore it will
 F
            not be proper to confer such a wider power upon.the
            board of directors by taking recourse to the doctrine
            of implied or inherent power."

      43. In Jagdev Singh v. The Registrar, Co-operative
 G Societies. Haryana and others 13 , the Full-Bench of High

       11 l:L.R. [1975] A.P. 242

       12 AIR 1982 Bombay 216

H      13 AIR 1991 p & H 149
 VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1029
        MARKETING FED. LTD. [KURIAN, J.]

Court of Punjab and Haryana held as follows:                     A

     "22 ..... the answer to the question posed in the
     beginning of the judgment, is that in absence of any
     provision in the Punjab Co-operative Societies Act,
     1961, Rules and the Bye-laws made thereunder (as            B
     also in the Haryana Cooperative Societies Act, 1984,
     Rules and the Bye-laws made thereunder) for moving
     a no-confidence in the President of a Managing
     Committee/ Chairman of a Board of Directors of a Co-
     operative Bank, it is not permissible to move such a        C
     motion, inasmuch as such a power cannot be inferred
     nor such a power is inherent in the members of the
     Managing Committee/Director of the Bank. The Office
     bearers can only be removed in accordance with
     Section 27 of the Act read with Rules 25 and 26 of          D
     the Rules. With respect we are unable to agree with
     the law laid down by the Division Bench in Haji Anwar
     Khan's case (AIR 1980 Punjab & Haryana 306)
     (supra) (which was a case under the Wakf Act), to our
     mind, does not lay down correct law."                       E

      44. It rnay be seen that all these decisions dealt with
  the pre-Ninety Seventh Amendment status of the
  cooperative societies. The amendment providing
. constitutional status to the societies· has brought out radical F
  changes in the concept of cooperative societies.
  Democratic functioning and autonomy have now become
  the core constitutional values of a cooperative society.
  Such societies are to be registered only if they are founded
 on cooperative principles of democracy, equality, equity G
 and solidarity.

    45. We may also refer to another argument by Shri
Sibal. That once the Act provides for a fixed term, the only
mode of unsettling the term is as provided under the Act. H
1030        SUPREME COURT REPORTS                  (2015] 3 S.C.R.


 A     In the instant case, it is Section 768 of the Act, which
       reads as follows:

           "76B. Removal of officer. - (1) If, in the opinion of the
          Registrar, any officer makes persistent default or is
 B        negligent in performance of the duties imposed on him
          by this Act or the rules or the bye-laws or does
          anything which is prejudicial to the interests of the
          Society or where he stands disqualified by or under
          this Act, the Registrar may, after giving the officer an
 C        opportunity of being heard, by order remove such
          officer and direct the Society to elect or appoint a
          person or a qualified member in the vacancy caused
          by such removal and the officer so elected or
          appointed shall hold office so long only as the officer
 D        in whose place he is elected or appointed would have
          held if the vacancy had not occurred.·

          (2) The Registrar may, by order, direct that the officer
          so removed shall be disqualified to hold or to contest
 E        election for any office in the society from which he is
          removed and in any other society for a period not
          exceeding four years from the date of the order and
          such officer may stand disqualified accordingly."
                                              •
 F      46. The provision simply deals with removal for
   misconduct or persistent default/non-performance. A
   person with good conduct may still not earn the confidence
   of the people who selected him to the office. The very
   concept of cooperation is to work jointly towards the same
 G end. Unless there is cooperativeness among the elected
   cooperators who constitute the Governing Body for
   achieving the object for which the society is constituted
   and for which those representatives are elected by the
   members entrusting them with the management of affairs
 H of the society, there will be total chaos. Cooperation among
 VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1031
        MARKETING FED. LTD. [KURIAN, J.]

the cooperators is the essence of democratic functioning A
of a cooperative society. If there is no democracy in a
cooperative society, it ceases to be a cooperative society
as conceived by the Constitution of India under the Ninety
Seventh Amendment.
                                                                 B
     47. There is no quarrel with the wellcsettled proposition
that a right to elect is not a fundamental right nor a
common law right; it is a statutory right, and any question
relating to election has to be resorted within the four
corners of the Act as held by this Court in Jyoti Basu and       c
others v. Debi Ghosal and others 14 . To quote paragraph-
8:
    "8. A right to elect, fundamental though it" is to
    democracy, is, anomalously enough, neither a
                                                                 0
    fundamental right nor a common law right. It is pure
    and simple, a statutory right. So is the right to be
    elected. So is the right to dispute an election. Outside
    of statute, there is no right to elect, no right to be
    el_ected and no right to dispute an election. Statutory      E
    creations they are, and therefore, subject to statutory
    limitation. An election petition is not an action at
    common law, nor in equity. It is a statutory proceeding
    to which neither the common law nor the principles of
    equity apply but only those rules which the statute          F
    makes and applies. It is a special jurisdiction, and a
    special jurisdiction has always to be exercised in
    accordance with the statute creating it. Concepts
    familiar to common lawand equity must remain
    strangers to election law unless statutorily embodied.       G
    A court has no right to resort to them on
    considerations of alleged policy because policy in such
    matters as those, relating to the trial of election
14 (1982) 1 sec e91                                              H
1032       SUPREME COURT REPORTS                  [2015] 3 S.C.R.


 A       disputes, is what the statute lays down. In the trial of
         election disputes, court is put in a strait-jacket. Thus
         the entire election process commencing from the
         issuance of the notification calling upon a constituency
         to elect a member or members right up to the final
 B       resolution of the dispute, if any, concerning the
         election is regulated by the Representation of the
         People Act, 1951, different stages of the process being
         dealt with by different provisions of the Act. There can
         be no election to Parliament or the State Legislature
 c       except as provided· by the Representation of the
         People Act, 1951 and again, no such election may be
         questioned except in the manner provided by the
         Representation of the People Act. So the
         Representation of the People Act has been held to be
 D
         a complete and self-contained code within which must
         be found any rights claimed in relation to an election
         or an election dispute. We are concerned with an
         election dispute. The question is who are parties to an
 E       election dispute and who may be impleaded as parties
         to an election petition. We have already referred to the
         scheme of the Act. We have noticed the necessity to
         rid ourselves of notions based on common law or
         equity. We see that we must seek an answer to the
 F       question within the four corners of the statute. What
         does the Act say?"

        48. In the background of the constitutional mandate,
   the question is not what the statute does say but what the
 G statute must say. If the Act or the Rules or the Bye-laws
   do not say what they should say in terms of the
   Constitution, it is the duty of the court to read the
   constitutional spirit and concept into the Acts. : .. "In so far
   as in its Act Parliament does not convey its intention
 H clearly, expressly and completely, it is taken to require the
 VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1033
        MARKETING FED. LTD. [KURIAN, J.]

enforcement agencies who are charged with the duty of A
applying legislation to spell out the detail of its legal
meaning. This may be done either- (a) by finding and
declaring implications in the words used by the legislator,
or (b) by regarding the breadth or other obscurity of the
express language as conferring a delegated legislative B
power to elaborate its meaning in accordance with public
policy (including legal policy) and the purpose of the
legislation" 15 .

   49. The conventional view is that the legislature alone C
makes the law. But as Bennion puts it:

     "The truth is that courts are inescapably possessed of
     some degree of legislative power. Enacted legislation
     lays down rules in advance. The commands of o
     Parliament are deliberate prospective commands. The
     very concept of enacted legislation postulates an
     authoritative interpreter who operates ex post facto. No
     such interpreter can avoid legislating in the course of
     exercising that function. It can be done by regarding E
     the breadth or other obscurity of the express language
     as conferring a delegated legislative power to
     elaborate its meaning in accordance with public policy
     (including legal policy)" 16 .
                                                                                 F
50. According to Donaldson J.:

     ''The duty of the courts is to ascertain and give effect
     to the will of Parliament as expressed in its
     enactments. In the performance of this duty the judges G

15 Bennion on Statutory Interpretation by Francis Bennion, 6'h

Edition, p.136.

16 Bennion on Statutory tnterpretation by Francis Bennion, 6th Edition, p.137.   H
1034          SUPREME COURT REPORTS                       (2015] 3 S.C.R.


 A          do not act as computers into which are fed the statues
            and the rules for the construction of statues and from
            whom issue forth the mathematically correct answer.
            The interpretation of statutes is a craft as much as a
            science and the judges, as craftsmen, select and
 B          apply to the appropriate rules as the tools of their
            trade. They are not legislators, but finishers, refiners
            and polishers of legislation which comes to them in a
            state requiring varying degrees of further processing."17

 c         51. In the celebrated case of Seaford Court Estates
       v. Asher18 , Lord Denning has succinctly summarized the
       principle on the role of the court. To quote:

            "Whenever a statute comes up for consideration it
 D          must be remembered that it is not within human
            powers to foresee the manifold sets of facts which
            may arise, and, ev~n if it were, it is not possible to
            provide for them in terms free from all ambiguity ... A
            judge cannot simply fold his hands and blame the
 E          draftsman. He must set to work on the constructive
            task of finding the intention of the Parliament, and he
            must do this not only from the language of the statue,
            but also from a consideration of the social conditions
            which gave rise to it arid of the mischief which it was
 F          passed to remedy, and then he must supplement the
            written word so as to give "force and life" to the
            intention of the legislature .... Put into homely
            metaphor it is this: A judge should ask himself the
            question how, if the makers of the Act had themselves
 G          come across this ruck in. the texture of it, they would
            have straightened it out? He must then do as they

       17 Corocraft Ltd v Pan American Airways Inc. [1968] 3 WLR 714 at 732.

 H     18 [1949] 2 All ER 155
 VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1035
        MARKETING FED. LTD. [KURIAN, J.]

    would have done. A judge must not alter the material A
    of which the Act is woven, but he can and should iron
    out the creases."

     52. In Rattan Chand Hira Chand v. Askar Nawaz
Jung (Dead) by Lrs. and others 19 , this Court, at B
paragraph-17 of the judgment, has also dealt with the
principles in following words:

    "17 . ... The legislature often fails to keep pace with
    the changing needs and values nor is it realistic to c
    expect that it will have provided for au contingencies
    and eventualities. It is, therefore, not only necessary
    but obligatory on the courts to step in to fill the lacuna.
    When courts perform this function undoubtedly they
    legislate judicially. But that is a kind of legislation which o
    stands implicitly delegated to them to further the object
    of the legislation. and to promote the goals of the·
    society. Or to put it negatively, to prevent the
    frustration of the legislation or perversion of the goals
    and values of the society. So long as the courts keep E
    themselves tethered to the ethos of the society and do
    not travel off its course, so long as they attempt to
    furnish the felt necessities of the time and do not
    refurbish them, their role in this respect has to be
    welcomed."                                                    F

    53. The cooperative society registered under the
Central or the State Act is bound to function as a
democratic institution and conduct its affairs based on
democratic principles. Democratic functioning on G
democratic principles is to be reflected in the respective
Acts or Rules or Bye-laws both on the principle and
procedure. If not, it is for the court to read the democratic
19 (1991) 3 sec 67                                              H
1036         SUPREME COURT REPORTS                 (2015) 3 S.C.R.


 A principles into the Act or Rules or Bye-laws. If a procedure
   is prescribed in any Act or Rule or Bye-law regarding
   election of an office bearer by the Board, as defined under
   Article 243ZH(b) of the Constitution of India, and for
   removal thereof, by way of a motion of no confidence, the
 B same procedure has to be followed. In case there is no
   express provision un,:ler the Act or Rules or Bye-laws for
   removal of an office bearer, such office bearer is liable to
   be removed in the event of loss of confidence by following
   the same procedure by which he was elected to office.
 c
            54. Now that this Court has declared the law regarding
       the democratic set up of a cooperative society and that it
       is permissible to remove an elected office bearer through
       motion ,of no confidence, and since in many States, the
 D     relevant statutes have not carried out the required statutory
       changes in terms of the constitutional mandate, we feel it
       just and necessary to lay down certain guidelines.
       However, we make it clear that these guidelines are open
       to be appropriately modified and given statutory shape by
 E     the competent legislature/authority. Having gone through
       the provisions regarding motion of no confidence in local
       self-governments, we find that there is no uniformity with
       regard to the procedure and process regarding motion of
 F     no confidence. Some States provide for a protection of two
       years, some for one year and a few for six months, to the
       office bearers in office before moving a motion of no
       confidence. However, majority of the States provide for two
       years and a gap of another one year in case one motion
G      of no confidence is defeated. Bihar Panchayat Raj Act,
       2006 provides for a protection of two years and one year,
       Bihar Municipal Act, 2007 provides for a protection of two
       years and one year, Himachal Pradesh Panchayati Raj Act,
       1994 provides for a protection of two years and two years,
 H     Madhya Pradesh Panchayat Raj Avam Gram Swaraj
 VIPULBHAI M. CHAUDHARY v. GUJARAT COOP. MILK 1037
        MARKETING FED. LTD. [KURIAN, J.)

Adhiniyam, 1993 provides for a protection of two and a         A
half years, Madhya Pradesh Municipalities Act, 1961
provides for a protection of two years and one year,
Manipur Panchayati Raj Act, 1994 provides for a protection
of two years and one year, Orissa Panchayat Samiti Act,
 1959 provides for a protection of two years, Orissa Grama     B
Panchayats Act,'   1964 provides for a protection of two
years, Punjab Panchayati Raj Act, 1994 provides for a
protection of two years, Rajasthan Panchayati Raj Act,
1994 provides for a protection of two years and one year,
Rajasthan Municipalities Act, 2009 provides for a protection   C
of two years and Uttar Pradesh Panchayati Raj Act, 1947,
as followed by Uttarakhand, provides for a protection of
two years and one year. Having regard to the set up in
local self-governments prevailing in many of the States as
                                                               0
above, we direct that in the case of cooperative societies
registered under any Central or State law, a motion of no
confidence against an office bearer shall be moved only
after two years of his assumption of office. In case the
motion of no confidence is once defeated, a fresh motion       E
shall not be introduced within another one year. A motion
of no confidence shall be moved only in case there is a
request from one-third of the elected members of the
Board of Governors/Managing Committee of the
cooperative society concerned. The motion of no                F
confidence shall be carried in case the motion is supported
by more than fifty per cent of the elected members present
in the meeting.

55. Though for different reasons, we agree with the view G
taken by the· High Court of Gujarat. The contra views
expressed by the High Courts of Andhra Pradesh, Bombay,
Kerala and Punjab and Haryana are no more good law in
view of the Ninety Seventh Amendment to the Constitution
                                                               H
1038        .SUPREME COURT REPORTS          [2015] 3 S.C.R.


 A     of India.

           56. The appeals are accordingly dismissed. There
       shall be no order as to costs.

       Devika Gujral                        Appeals dismissed.