INDIAN LABOUR CO-OPERATIVE SOCIETY LTD. AND ANR versus UNION OF INDIA AND ORS.

Citation: [1999] 3 S.C.R. 971 · Decided: 20-07-1999 · Supreme Court of India · Bench: B.N. KIRPAL, S. RAJENDRA BABU · Disposal: Disposed off
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Judgment (excerpt)

(. 
INDIAN LABOUR CO-OPERATIVE SOCIETY LTD. AND ANR. 
A 
v. 
UNION OF INDIA AND ORS. 
JULY 20, 1999 
[B.N. KIRPAL ANDS. RAJENDRA BABU, JJ.] 
B 
Co-operative Societies. 
Multi State Co-operative Societies Act, 1984 : 
Ss.34, 36, 37 and 99(2)-Exemption under s.99(2) in respect of ss.36 C 
and 37-Multi State Co-ope~ative Societies-National Co-operative Union 
of India and Co-operative Bank of India-President of NCUJ holding also 
office of chairman of COBI-Central Government granting exemption to 
President of NCUI from the bar u!s. 36 for holding offices in more than one 
Co-operative Society as also from the bar u!s. 37 for holding office of D 
President/Chairman for more than two consecutive terms-Held, the rigour 
of provisions of ss. 36 and 37 is qua an individual and not qua the society-
ss. 99(2) enables the Government to give relief to the Society from operation 
of any provision of the Act and not to an individual-Just as applicability 
of s.34 cannot be dispensed with or relaxed, similarly exemption u!s.99(2) E 
cannot be granted in respect of ss. 36 and 37-0rders dated 13.1.1998 
granting the exemption are quashed. 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 223of1999 
Etc. 
From the Judgment and Order dated 18.9.98 of the Delhi High Court in F 
C.W.P. No. 3350of1998. 
C.S. Vaidyanathan, Additional Solicitor General, K.K. Venugopal, N.D. 
Nanavati, K.N. Bhat, M. Ramajois, Manoj Wad, Yashank Adhyaru, Ashish 
Wad, Naveen R. Nath, S.R. Bhat, Ms. Hetu Arora, Ms. Neeru Vaid, Anil Amrit, 
Ms. N. Annapoorani and B.V. Bairam Das for the Appearing parties. 
G 
The following Order of the Court was delivered : 
The challenge in this appeal is to the exercise of powers by the Central 
Government under Section 99 of the Multi State Co-operative Societies Act, 
1984 (hereinafter referred to as 'the Act') whereby it has pmported to grant H 
971 
972 
SUPREME COURT REPORTS 
[1999] 3 S.C.R. 
A an exemption to respondent No. 3, namely, The National Cooperative Union 
of India (for short NCUI) from the provisions of Section 36 and Section 37 
of the said Act. 
Briefly stated the facts for the purposes of this case are that respondent 
No.3 is a Multi State Cooperative Society. Slui B.S. Vishwanathan, respondent 
B No. 4 was first elected as its President in 1990. Upon the three years term 
contemplated by Section 35 coming to an end he was re-elected for a further 
peri0d of three·ye_ars. hi the meanwhile National Cooperative Bank of hldia 
(later re-named Cooperative Bank of India) [hereinafter referred to as 'COBI'] 
was promoted. Respondent No. 4 was also elected as the Chairman of OB in 
C February 1994 for a period of three years. 
Since Section 36 of the Asr restricted an individual from holding the 
office of Chairman/Vice-Chairman, President/Vice-President in more t:µan one 
Multi State Cooperative Society, the Central Government was approached and 
by orders dated 23rd August, 1994 and 1st February, 1995 exemption was 
D accorded under Section 99(2) in respect of Section 36 to NCUI and COBI. On 
16th January, 1997 3rd exemption for two years from 3rd February, 1996 to 2nd 
February, 1998 was granted under Section 99(2) from the bar of Section 36 of 
the Act. The fourth exemption from the bar of Section 36 for a period of two 
years was granted on 13-1-98 from 3rd February, 1998 to 2nd February, 2000. 
Bar of Section 37 was sought to be removed firstly by an exemption granted 
E for two years by order dated 16th January, 1997 which was followed by a 
subsequent order dated 13th January, 1998. 
The appellant then filed a writ petition in the High Court of Delhi 
seeking to challenge the two exemptions dated 13th January, 1998 one relating 
F to sections 36 and the other relating to Section 3 7 which exemption had 
permitted respondent No. 4 to continue as the Chairman of NCUI and COBI 
simultaneously and for more than two terms. 
G 
On the writ petition being dismissed by the High Court the present 
appeal has been filed. 
The validity of the action of the Government depends on the 
inteI]Jretation of some of the provisions of the Act. Chapter IV of the Act 
contains provisions regarding the direction and management of the multi 
State Cooperative Societies. Section 34 sets out the disqualifications regarding 
a member of a Board; Section 3 5 provides for election of members of the bar, 
H which stipulates that the member shall be elected for a period not exceeding 
INDIAN LABOUR CO-OPER. SOCIETY LTD. v. U.O.I. 
973
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