LexPUNDALIK versus DISTRICT DEPUTY REGISTRAR, CO-OPERATIVE SOCIETIES, CHANDRAPUR AND ORS.
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PUNDALIK v. DISTRICT DEPUTY REGISTRAR, CO-OPERATIVE SOCIETIES, CHANDRAPUR AND ORS. FEBRUARY 22, 1991 [K.N. SAIKIA AND MADAN MOHAN PUNCHHI, JJ.] Maharashtra Co-operative Societies Act, 1960: Section 78( 1) and 73FF-Powe~ of removal of members/committees-Defaul~ in repay- ment of loan instalments Disqualifications for being member of a committee. The appellant was elected on 18.8.1986 as one of the Directors of A B c the District Central Co-operative Bank, Chandrapur, Maharashtra from the_ Brebmapuri Agtjcultm;al Sales and Purchase Society. On 8.1.1987 the District Deputy Registrar of the Co~operative Societies, Chandrapur issued a notice to him under section 78(1) of the Act to D show cause as to why he should not be removed from the Board of Directors of the Bank and from the Executive Committees of other Co-operative Societies in the Distict for having remained in arrears of' the loan instalments due from him on the date of filing of nomination papers for election to the post of Director of the Bank and thereafter till ...-. >-..-2i.10.i986 when he actu8Iiy repaid the dues thereby incurring the dis- .· ·qualification as contemplated by section 73FF of the Act. The appellant E - showed cause and by additional reply took the stand that he had not committed any de~ault after the amended sect.ion 73FF came into exis- tence. This was rejected and by Order dated 7.12.1987 passed by the Assistant Registrar Co-operative Societies, Chandrapur he was re- moved from the post of Director holding him to be a defaulter under F section 73FF of the Act. Appeal against that order was dismissed by the ~ District Joint Registrar and bis revision therefrom made 0nder section 154 of the Act too met the same fate at the hands of the Cooperative & Textile Department, State_ of Maharashtra, Bombay. Dismiss~ his Writ Petition fded thereafter, the High Court of Bombay held that when the appellant contested the election he was a defaulter 311d even though. G he had paid all the debts on 21.10.1986 yet he could not be absolved of the disqualification on the day he contested the election. In the appeal before this Court it was argued on behalf of the appellant that the impugned order of the Assistant Registrar removing him from the Board of Directors was without jurisdiction in as-much-as H 675 A B c D E 676 SUPREME COURT REPORTS [199ll 1 S.C.R. the Act prescribes separate procedure for calling in question the elec•·--r---- tion and that procedure . having not been followed the Assistant Registrar could not have acted under section 78(1) of the Act; that the entire loan having been repaid before the issue of notice under section 78(1) he was not a defaulter in presenti and lastly even assuming that the disqualification on the ground of default is common both for elec~ tion and for continuation as Director in the Committee, the spedal provision for calling in question an election must prevail over section ~ 78. Rejecting the contentions and dismissing the appeal, the Court. r - HELD: If the impugned order is found to have been passed by way of settin._g aside the election of the appellant, it would be bad as bis election had not been called in question in accordance with the proce- ~ dure prescribed by the Act. However, the notice has ex facie been issued under section 78 of the Act. No doubt there is reference to his having been a defaulter and disCJ,ualified for being elected but it has been y--- addressed to him as Director on the Board of Dir!!ctors. It also refers to · his being disqualified "to be elected or to continue as Director or Execu- tive Committee member of the Executive Committee" under section 7~:FF of the Act and about ceasing to be a Director by committing default. From the above contents, there is no room for holding that the appellant's election bas been set aside by the impugned order. On the other band, the emphasis is on his being disqualified to continue as · Director or ceasing to be Director on account of bis having committed ... ~ default. [682F-683A] The day an instalment falls due on its due :date, failure to pay results in default and this default continues day after day until jt is repaid. The appellant can be said to have made default on the first day of bis directorship and on every subsequent day till instalments were -- F paid~ The appellant was a defaulter immediately on the coming into - .force· of section 73FF a11d_so long that
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