Court’s Decision
The Patna High Court dismissed a writ petition challenging the order of the Minister, Department of Co-operative, Bihar, who had entertained an appeal and stayed the decision of the District Co-operative Officer, Khagaria. The Court held that the impugned order of suspension of the Board was passed under Section 41(2) of the Bihar Co-operative Societies Act, 1935, and therefore, it was appealable under Section 41(6) before the State Government. It emphasized that the Minister’s order was merely interlocutory and not final. The Court directed that the appeal pending before the Minister be decided within 60 days.
Facts
The petitioners approached the High Court seeking to quash the order dated 08.07.2025 passed by the Minister, which stayed the earlier order of the District Co-operative Officer dated 25.06.2025 issued under Memo No.1344. The District Co-operative Officer had taken action against the Managing Committee of a Primary Agricultural Credit Society (PACS).
The petitioners argued that the District Co-operative Officer’s order was under Section 41(5) of the Act, which deals with dissolution of the Managing Committee upon resignation or vacancy of members, and such an order is not appealable. They claimed that entertaining an appeal by the Minister was therefore illegal.
On the other hand, the respondents contended that the District Co-operative Officer’s order was passed under Section 41(2), relating to suspension of the Board, and hence was appealable under Section 41(6) before the State Government. They further argued that the Minister’s order was not a final adjudication but only an admission of appeal fixing further dates.
Issues
- Whether the order of the District Co-operative Officer dated 25.06.2025 was passed under Section 41(2) (suspension of Board) or Section 41(5) (dissolution of Managing Committee).
- If it was under Section 41(2), whether an appeal was maintainable before the State Government under Section 41(6).
- Whether the Minister’s order amounted to a final decision warranting writ interference.
Petitioner’s Arguments
The petitioners contended that the order of the District Co-operative Officer was in fact under Section 41(5), which empowers the Registrar to dissolve a Managing Committee when the majority of members resign or seats fall vacant. Since Section 41(5) does not provide for appeal, they argued that entertaining the appeal by the Minister was wholly without jurisdiction. They insisted that the order of suspension was camouflaged as one under Section 41(2) to make it appealable. They therefore prayed for quashing of the Minister’s order staying the District Co-operative Officer’s directive.
Respondent’s Arguments
The respondents, including the State and the PACS Chairman, countered that the impugned order was explicitly under Section 41(2), since it contained a clear reference to suspension of the Board with reinstatement after six months if not superseded — a condition specific only to Section 41(2). They stressed that under Section 41(6), such an order is appealable to the State Government, which in practice is exercised by the Minister of Co-operatives. They also argued that the Minister’s order was not final but merely admitted the appeal, fixed dates, and therefore amounted to an interlocutory order not warranting writ interference.
Analysis of the Law
The Court examined the relevant provisions:
- Section 41(2): Authorises the Registrar to suspend the Board of a society if necessary in the interest of the society. Suspended boards must be reinstated after six months if not superseded.
- Section 41(5): Empowers the Registrar to dissolve the Managing Committee if members resign or seats fall vacant, followed by appointment of an Administrator.
- Section 41(6): Provides that appeals lie to the State Government against orders passed under Section 41(1) or Section 41(2).
The Court observed that the District Co-operative Officer’s order specifically referred to reinstatement of the Board after six months, which was a condition traceable only to Section 41(2). Thus, the order was clearly a suspension under Section 41(2) and not a dissolution under Section 41(5).
Consequently, the Minister was competent to entertain the appeal under Section 41(6).
Precedent Analysis
Although no external case law was directly cited, the Court’s reasoning aligned with settled principles:
- Interlocutory orders do not warrant writ interference.
- High Courts should not intervene when statutory appeal remedies exist.
- Administrative powers under the Co-operative Societies Act must be interpreted contextually, ensuring that suspension and dissolution are distinguished on their statutory footing.
Court’s Reasoning
The Court held that the petitioners’ reliance on Section 41(5) was misplaced. Since the proviso of Section 41(2) was explicitly mentioned in the order of the District Co-operative Officer, it was clearly a suspension order. Hence, the Minister rightly exercised appellate jurisdiction under Section 41(6).
Further, the Minister’s order was merely the first order admitting the appeal and fixing dates, which was interlocutory in nature. The High Court therefore found no reason to interfere, as writ jurisdiction is not intended for premature challenges to interlocutory orders.
Conclusion
The writ petition was dismissed. The High Court confirmed that the Minister’s order entertaining the appeal was lawful and directed that the pending appeal be disposed of within 60 days of completion of appearance.
Implications
This judgment clarifies the scope of Sections 41(2), 41(5), and 41(6) of the Bihar Co-operative Societies Act. It underscores that suspension of a Board under Section 41(2) is appealable to the State Government, while dissolution under Section 41(5) is not. It also signals judicial reluctance to interfere with interlocutory orders when the statutory appellate process is ongoing. For co-operative societies, it provides certainty in distinguishing suspension from dissolution and delineates the limits of High Court writ jurisdiction in such disputes.
FAQs
Q1. Can suspension of a Co-operative Society’s Board be challenged in appeal?
Yes. Under Section 41(6) of the Bihar Co-operative Societies Act, orders under Section 41(2) suspending a Board are appealable before the State Government.
Q2. Is dissolution of a Managing Committee under Section 41(5) appealable?
No. Dissolution under Section 41(5) does not carry an appellate remedy under Section 41(6).
Q3. Why did the High Court refuse to interfere with the Minister’s order?
Because the order was interlocutory in nature, admitting the appeal and not deciding it finally. The proper course is to allow the appeal to be heard and disposed of by the statutory authority.
