LexSHRI. MASAIDEVI VIVIDH KARYAKARI SAHAKARI SEVA SANSTHA MARYADIT WAREWADI versus THE STATE OF MAHARASHTRA & ORS.
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[2025] 5 S.C.R. 409 : 2025 INSC 436 Shri. Masaidevi Vividh Karyakari Sahakari Seva Sanstha Maryadit Warewadi v. The State of Maharashtra & Ors. (Civil Appeal No. 4669 of 2025) 02 April 2025 [Vikram Nath and Prasanna B. Varale,* JJ.] Issue for Consideration Whether the High Court rightly set aside the orders passed by the State directing registration of the appellant-society. Headnotes† Maharashtra Co-operative Societies Act, 1960 – ss.4, 6 – Societies which may be registered – Conditions of registration– Appellant-society applied for registration of proposed society as a new Primary Agricultural Credits Co-operative Society – Scrutiny Committee rejected the application mainly on the ground of unsubstantiated financial viability of the appellant – Order set aside by State, registration directed – Order set aside by High Court– Sustainability: Held: Impugned order upheld – Under ss.4 and 6, the economic viability of the society is a pre-requisite or basic condition for grant of registration to the society – Scrutiny Committee being an expert Committee was established specifically for the inspection of financial ability of a prospective society – It found that there was nothing in the proposal submitted by the appellant to substantiate the conditions of financial health as provided in the Government Resolution dated 14.02.2017 – There was no material on record before the Committee to show that the appellant was in a position to comply with the pre-requisites as referred therein – While deciding the appeal, State completely ignored the basic criteria or the pre-requisite for the registration of society, i.e. its economic viability, laid down by the State itself through its various Government Resolutions – By relaxing the pre-requisite condition relating to financial viability, the * Author 410 [2025] 5 S.C.R. Supreme Court Reports State allowed the registration of the society frustrating the very object of the Act – Committee had rightly rejected the application for registration – State unjustifiably interfered in the Committee’s order – High Court rightly set aside the order of the State. [Paras 17, 18, 22, 25, 27-29, 32, 34, 35] Maharashtra Co-operative Societies Act, 1960 – s.4: Held: The constitution of the Scrutiny Committee and the examination of the proposal by the Committee is a vital part of the Policy Directives of the State Government which is required to be complied with conditions u/s.4 – If a society is unable to comply with the pre-condition or prerequisite in regard to the economic viability of the society, allowing the registration of such a society which might not even be able to function, may adversely affect its members ultimately, frustrating the very object of the establishment of the said society – Thus, ignoring the findings of the Committee and allowing the registration of the society led to an unjustifiable interference in the Committee’s Order – Further, State Government may use its discretion for relaxation of conditions – However, such discretion cannot be used to frustrate the very object of the Act – Power of relaxing the necessary pre-requisites could have been made only through a Government Resolution and not at the whims of the State in an appeal which essentially led to by-passing the eligibility criteria set out by the Government through its multiple Resolutions. [Paras 30-32] List of Acts Maharashtra Co-operative Societies Act, 1960. List of Keywords Sections 4 and 6 of the Maharashtra Co-operative Societies Act, 1960; Registration of proposed society; Primary Agricultural Credits Co-operative Society (PACCS); Financial viability of the Society; Economic viability; Basic criteria or pre-requisite/pre-condition for the registration of society; Scrutiny Committee; Expert Committee; Government Resolutions; Registered co-operative society; Eligibility criteria of the applicant societies; Locus standi; Financially viable; Discretion for relaxation of conditions; Frustrate the object of Act; Patent illegality. [2025] 5 S.C.R. 411 Shri. Masaidevi Vividh Karyakari Sahakari Seva Sanstha Maryadit Warewadi v. The State of Maharashtra & Ors. Case Arising From CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4669 of 2025 From the Judgment and Order dated 05.01.2024 of the High Court of Judicature at Bombay in WP No. 8654 of 2023 With Civil Appeal Nos. 4670, 4671, 4672, 4673, 4674, 4675, 4676, 4677, 4678, 4679, 4680, 4681, 4682, 4683, 4684,
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