1983 (10) TMI 270 - SC - Indian Laws

Summary

Issues Involved:
1. Interpretation and application of Sec. 73B of the Maharashtra Cooperative Societies Act, 1960.
2. Validity of the election process in light of Sec. 73B.
3. Compliance with mandatory statutory provisions for reserved seats.

Issue-wise Summary:

1. Interpretation and Application of Sec. 73B:
The core issue revolves around the construction of Sec. 73B of the Maharashtra Cooperative Societies Act, 1960. The section mandates that two seats on the committee of specified societies be reserved'one for Scheduled Castes or Scheduled Tribes and one for the weaker section of members who have been granted loans not exceeding Rs. 200 during the year immediately preceding. If no such persons are elected or appointed, the committee must co-opt the required number of members.

2. Validity of the Election Process in Light of Sec. 73B:
In both appeals, the elections to the Boards of Directors of the respective cooperative banks were challenged for not complying with Sec. 73B. The election programmes did not specify the reserved seats, thereby failing to notify eligible candidates. The High Court had upheld the elections, reasoning that co-option could suffice to fulfill the mandate of Sec. 73B. However, the Supreme Court emphasized that the legislative intent prioritizes election over co-option, stating: "The first and the foremost pride of place is accorded to election."

3. Compliance with Mandatory Statutory Provisions for Reserved Seats:
The Supreme Court underscored that the election process must comply with Sec. 73B, which requires the election programme to specify reserved seats. The failure to do so vitiates the election process, as it denies eligible candidates the opportunity to contest. The Court held: "The failure to hold election in accordance with the Act including Sec. 73B would vitiate the whole election programme from commencement till the end."

Conclusion:
Both appeals were allowed. The decisions of the Bombay High Court were quashed, and the elections were declared invalid. The statutory authorities were directed to hold fresh elections within three months, ensuring compliance with the mandatory provisions of Sec. 73B. The Court maintained the status quo until the new elections were conducted.