INSTITUTE OF COMPANY SECRETARIES OF INDIA versus BIMAN DEBNATH & ORS.

Citation: [2022] 15 S.C.R. 616 · Decided: 07-11-2022 · Supreme Court of India · Bench: M.R. SHAH · Disposal: Appeal(s) allowed

Judgment (excerpt)

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SUPREME COURT REPORTS
[2022] 15 S.C.R.
INSTITUTE OF COMPANY SECRETARIES OF INDIA
v.
BIMAN DEBNATH & ORS.
(Civil Appeal No. 8039 of 2022)
NOVEMBER 7, 2022
[M. R. SHAH AND M. M. SUNDRESH, JJ.]
Company Secretaries Regulations, 1982: rr. 92, 117 and 119
– Elections for the office bearers of EIRC – Meeting was required
to be chaired by the Chairman, EIRC, however, he was disqualified
to hold his office and thus, it fell vacant in terms of r117(2) – It was
required to be filled in for the remaining period in terms of Regn
119(2) – Contesting respondent as Vice Chairman of the Institute
was allowed to chair the meeting for the limited purpose of election
to the post of Chairman for the remaining period in terms of Regn
119(2) – Respondent disrupted the meeting, and for the election of
the chairman for the remaining period, the members appointed
respondent no. 3 to chair the said item – Elections took place and
respondent no. 3 was duly elected as Chairman for the remaining
period – High Court quashed the election of the office bearers of
the Regional Council on the ground that the meeting was not presided
over by the Vice Chairman – On appeal, held: It was a case of
vacation of office of the Chairman and not mere absence – Regn
119 states that in case of vacancy of the Chairman, Vice Chairman,
Secretary and Treasurer, the Regional Council shall elect another
person from amongst its members to hold the office for the remaining
period of a year – Regn 92(2) shall be applicable only in a case of
absence and not in a case where the post of Chairman and/or office
bearer has fallen vacant – Thus, in case of a vacation of office as
per Regn 117(2), such post fallen vacant is required to be filled in
by election by electing another person from amongst its members to
hold the office for the remaining period of a year – Single Judge as
well as the Division Bench of the High Court erred in misinterpreting
Regn 92(2) and Regn 117 rw Regn 119(2) – Thus, the election of
respondent no. 3 as chairman rightly held and he rightly presided
the meeting – High Court erred in quashing and setting aside the
election.
[2022] 15 S.C.R. 616
616
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Allowing the appeals, the Court
HELD: 1.1 Regulation 117 of the Company Secretaries
Regulations, 1982 deals with the vacancies. As per Regulation
117(2) an elected member of Regional Council who has been
found guilty of any professional or other misconduct, shall be
deemed to have vacated office from the date of the order. In the
instant case the then Chairman, EIRC was disqualified to hold
his office on 22.12.2021. Therefore, it was a case of vacation of
office of the Chairman. [Para 4.2][623-G]
1.2 Regulation 119 deals with the Proceedings of the
Regional Council. As per Regulation 119(2) every Regional
Council shall at its first meeting held after its constitution and in
subsequent years at a meeting to be held in December of every
year elect from amongst its members a Chairman, a
Vice-Chairman, a Secretary and a Treasurer thereof to hold office
for a period commencing from the date of its first after constitution
or from 1st January of the subsequent year as the case may be
till the 31st December of that year and so often as any of those
offices become vacant, the Regional Council shall elect another
person from amongst its members to hold the office for the
remaining period of a year. Thus, as the office of the Chairman
fell vacant due to its disqualification any person from amongst its
members was required to be elected as Chairman and/or to hold
the office of the Chairman for the remaining period. Therefore,
in exercise of powers under Regulation 119(2) of the Regulations,
1982, Respondent No.3-AK was elected as the Chairman for the
remaining period who presided over the meeting dated
27.12.2021. [Para 4.3][624-A-D]
1.3 It was the case on behalf of Respondent no.1 which
came to be accepted by the Single Judge and the Division Bench
of the High Court that being a Vice Chairman, a meeting was
required to be chaired/presided over by him in absence of the
Chairman. Heavy reliance was placed on Regulation 92(2). On
fair reading of Regulation 92(2) read with Regulation 117(2),
Regulation 92(2) shall not be applicable at all. Regulation 92(2)
shall be applicable only in a case of absence and not in a case
where the post of Chairman and/or office bearer has fallen vacant.
INSTITUTE OF COMPANY SECRETARIES OF INDIA v.
BIMAN DEBNATH & ORS.
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SUPREME COURT 

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