Gurunath Reddy vs The State of Karnataka and others. Writ Petition 226145/2020 & Connected matters decided on 16 October 2020.
Judgment Link: http://judgmenthck.kar.nic.in/judgmentsdsp/bitstream/123456789/346429/1/WP226145-20-16-10-2020.pdf
HELD: Paragraph 23. This Court is mindful of the following principles of law which are now metamorphosed while examining the Constitutional validity of any law or a provision/s of such law. (a) Constitution of India is the Grundnormand and all laws flow therefrom. Thus any law which violates the principles of the Constitution would be tested for legislative competence / violation of the rule of law/ basic structure / abridgement of fundamental rights etc. There is always a presumption in favour of the constitutionality of an enactment and the burden is upon him who attacks it to show that there is a clear transgression of the principles of the Constitution of India. (Shri Ram Krishna Dalmia and others vs. Shri Justice S.R.Tendolkar and others reported in AIR 1958 SC 538). (b) The Courts are reluctant to declare a law invalid or ultra vires on account of unconstitutionality. Instead the Courts would accept an interpretation which would favour the constitutionality than accept an approach which would render the law unconstitutional (Government of Andhra Pradesh vs. P.Laxmi Devi reported in AIR 2008 SC 1640). (c) Declaring a law unconstitutional is one of the last resorts to be taken by Courts. Instead the Courts would employ principles of reading down or reading into the provisions to make it effective and workable. (A.R.Antulay vs R.S.Nayak and another reported in 1988 (2) SCC 602). (d) In A.R.Antulay vs R.S.Nayak reported in (1988(2) SCC 602), the Apex Court held that if two views are possible, one making the law constitutional and the other making it unconstitutional, the former view must prevail and the Court must make efforts to uphold the constitutional validity of a statute.
25. The petitioners cannot sustain their challenge to Section 28-A(5) of the Act of 1959 on the basis that it infringes Article 19(1)(c) of the Constitution of India, as there is no embargo placed upon the rights of the petitioners to form a society. Further neither the Act of 1959 nor Section 28-A(5) contained therein can be treated as a reasonable restriction under Article 19(4) against exercise of any right conferred by Article 19(1)(c) of the Constitution.
26. If that be so, can the appointment of an administrator under Section 28-A(5) of the Act of 1959 be held unconstitutional on the ground that it violated the “autonomous” functioning of a co-operative society?
27. It is pertinent to note that cooperative societies in Karnataka were self-governed institutions but were controlled and regulated by the Act of 1959. As is evident from the Statement of Objects and reasons for the introduction of Part IX-B into the Constitution of India, which is extracted above, the Government of India felt a strong need to amend the Constitution of India so as to keep the co-operatives free from unnecessary outside interferences and also to ensure their autonomous organizational set up and their democratic functioning. Thus, with an avowed object to make these societies autonomous by infusing certainty of term / transparency / accountability / equal participation, the Parliament introduced the Ninety-seventh (97th) amendment to the Constitution exalting the right to form co-operative societies as a fundamental right under Article 19(1)(c) of the Constitution and stipulated an endeavour to the State under Article 43B to promote voluntary formation, autonomous functioning, democratic control and professional management of co-operative societies. Article 243-ZI of the Constitution provided for the incorporation of cooperative societies, regulation and winding up of co- operative societies based on the principles of voluntary formation, democratic member-control, member-economic participation and autonomous functioning.
28. It is relevant to note that prior to Ninety- seventh (97th) amendment to the Constitution, elections were conducted by the outgoing managing committee under the supervision of the Registrar of societies. Now by virtue of the 97th amendment, a Cooperative Election Authority is constituted for the purpose of conducting elections to the Board of management. The petitioners have not challenged the constitution of such election authority as violating the autonomous functioning of a cooperative society. The words “autonomous functioning” itself indicates that the autonomy is in the functioning of the society. The “autonomy” granted to a co-operative society cannot be understood as “freedom” from regulation by legislation/ scrutiny by the executive. The word “autonomy” or “autonomous” cannot be read either in isolation or in a manner which may defeat the legislative aim to professionalize the working of co-operative societies and ensure their running on economically sound principles. In fact, the Ninety-seventh (97th) Constitutional Amendment reflect the legislative intent to revamp and reenergise the co-operative movement as a whole and to ensure that co-operative movement surges towards the achievement of the goals of securing social and economic justice and the equitable distribution of the fruits of developments.
29. One of the purposes of Part IX-B of the Constitution is to ensure a smooth transition by the outgoing board to the incoming board of management so that there is no vacuum between the two. That is the reason why Article 243-ZK of the Constitution provides that the election of a board shall be conducted before the expiry of a term of the board so as to ensure that the newly elected members of the board assume office immediately on the expiry of the office of the members of the outgoing board. Thus, even in the contemplation of the Parliament, the conduct of elections by election authority before the expiry of the term of the board did not impinge the autonomous functioning of a cooperative society.
31.In the present case, the elected members of the Board have vacated the office and a vacuum is created between the outgoing board and the to-be elected board due to covid-19 pandemic. The learned counsel for the petitioners were unable to point out any provision either in Part IX-B of the Constitution of India or the Karnataka Co- operative Societies Act, 1959 which enabled the Government of the day to extend the term of the elected members of the board. Section 39-A of the Act of 1959 imposes a positive duty on the Election authority to conduct the elections and to ensure strict compliance. It is precisely for this reason that Section 39-AA(15) of the Act of 1959 mandates that the Board of a Society should furnish the list of members in advance. Section 28-B(2) of the Act of 1959 provides that if the Board fails to make arrangements for elections within the time specified in Section 39-A, then the Board would be deemed to have vacated their office and the members of the Board would be disqualified from contesting the elections. It is with a view to avoid such vacuum that Section 28-A(5) of the Act of 1959 provides for the appointment of an administrator if elections are not held under Section 39-A of the Act of 1959. This is clearly in line with Article 243-ZL(v) of the Constitution which provides for supersession of a co- operative society if the Co-operative Election Authority under Section 39-AA of the Act of 1959, fails to conduct elections in accordance with the provisions of the Act of 1959. If Part IX-B of the Constitution of India itself provides for supersession / suspension and interim management of a co-operative society, subject however to certain conditions, the same cannot be construed as affecting the “autonomous functioning” of a co-operative society. When a statute or provisions thereof owes its emergence to a provision of the Constitution of India, then the question of considering the interplay between the two would not arise, as the examination of the statute is limited to ascertain whether the statute or the provisions thereof adhere to the constitutional mandate. It is the Constitutional mandate that has to be upheld. Thus Section 28-A(5) and Section 28-B of the Act of 1959 cannot be termed unconstitutional as they do not undermine the autonomous functioning of a co-operative society but on the contrary enhances autonomy.
Compiled by S. Basavaraj, Advocate, Daksha Legal.
Daksha Legal 