PAKISTAN EXPRESS CO OPERATIVE BANK LIMITED Versus REGISTRAR, CO OPERATIVE

S. A. RAHMAN, J.-In this case, the Registrar, Co-operative Societies, purporting to act under rule 48 of the Rules framed under section 71 of the Co-operative Societies Act, 1925, has superseded what he described as "the Board of Directors" of the petitioner Batik and replaced it by an Administrator. The petitioner challenged the validity of this order by a petition in the High Court for a writ but failed. This is a petition for Special Leave to Appeal from the order of the High Court. Dr. Nasim Hasan Shah contended firstly, that the notice to show cause was given to the Managing Committee of the Bank but the final order passed by the Registrar superseded the Board of Directors and therefore, this had no relevance to the original notice. He claimed that there was a Board of Directors separate from the Managing Committee. In support of this allegation however, the learned counsel has not been able to adduce any document, though an adjournment was granted for this very purpose. The bye-laws of the petitioner Bank mention only a Managing Committee. Learned counsel was unable to produce any resolution of the Bank by which a Board of Directors may have been constituted. There is also no evidence to show that there was a demarcation of functions between the Managing Committee and any such alleged Board of Directors. In the circumstances, the conclusion would not be unfair that in the final order the Managing Committee was merely mis-described as the Board of Directors. The objection taken, therefore, is not a point of substance and must be repelled.

Dr. Nasim Hasan Shah then attempted to argue that the impugned action was not justified by any provision of the Co-- operative Societies Act, 1925. The learned Judges of the High Court have noted that there is no express provision in the substantive part of the Act providing for supersession of a Committee of Management of a Co-operative Society, such as the petitioner was. But they have spelled out this power from the provisions of clauses (g) and (ga) of subsection (2) of section 71 of the Act, which permit rules to be framed inter alia, for suspetisio1t of the members of a Managing Committee and their replacement by an Administrator, in order to carry out the purposes of the Act. The purpose of the Act, as would be clear by a reference to its various provisions, is to exercise strict control over the functions of the Co-operative Societies. A Co- operative Society can even be wound up under section 47 of the Act. We therefore, agree with the learned Judges of the High Court that the provisions of clauses (g) and (ga) of sub--section (2) of section 71 of the Act are of a sufficient mandate for rule 48, which provides for supersession of the Managing Committee.

Learned counsel then contended that subsection 2 (g) of section 71 of the Act envisages the suspension of the Members of the Committee, and not of the Committee as a whole. He suggests therefore, that individual notices should have been issued to members of the Managing Committee, whereas in the present case, only one notice was issued to the Managing Committee through the General Manager. The point is again devoid of substance. If all members of the Committee could be suspended, this would amount to suspension of the Committee as a whole. The allegations made against the Members of the Committee were common to all of them, and therefore, a common notice was in our opinion, a sufficient compliance with the provisions of the law, in the circumstances of this case.

Lastly the learned counsel advanced the argument that sufficient opportunity had not been allowed for a defence to be made to the notice. A 20-days' notice had been given in this case and a meeting of the Committee was called to consider tile matter on the 7th September 1965. It appears that all the members did not attend owing to the war emergency. A letter was sent to the Registrar, Co-operative Societies on behalf of the Committee, asking for further time to submit a reply. But this request was not acceded to. The original notice had been issued on the 21st August 1964, and the reply was to be submitted by the 10th of September 1964. The Committee sent a reply on the 9th September 1965, asking for time, and claiming that the Managing Committee had shown energy unmaking various recoveries amounting to Rs. 8 laces from certain parties during the last eight months. No specific denial of the allegations specified in the report was, however, contained in the reply which asked for more time. In the circumstances, it was open to the Registrar to assume that no satisfactory explanation was forthcoming, and he passed the final order on the 20th of October 1965. Till then, apparently, no attempt was made, by the Committee to furnish a satisfactory explanation. We consider that there was ample opportunity for the Committee to explain matters which they failed to do.

The petition fails and is hereby dismissed.