STATE OF UP AND ANR. ETC. versus C.O.D. CHHEOKI EMPLOYEES' CO-OP SOCIETY LTD. AND ORS. ETC.

Citation: [1997] 1 S.C.R. 380 · Decided: 17-01-1997 · Supreme Court of India · Disposal: Appeal(s) allowed
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Judgment (excerpt)

A 
B 
c 
STATE OF U.P. AND ANR. ETC. 
v. 
C.O.D. CHHEOKI EMPLOYEES' CO-OP. 
SOCIETY LTD. AND ORS. ETC. 
JANUARY 17, 1997 
[K. RAMASWAMY ANDS. SAGHIR AHMAD, JJ.] 
U.P. Co-operative Societies Act, 1965/U.P. Co-operative Societies 
Rules, 1968 : 
Sections 4, 130(2)(xii) and (xii-A)/Rules 393(1) & (2) 393-A, 393-B, 
clause (d) of sub-rule (4), 440(6) to (8) 444-A and 453--Committee of 
Management-Reservation in favour of weaker sections-Quashed by the. 
High Court-On appeal, held the provisions of the Act and the Rules are 
consistent with the policy and object of the Constitution-Hence, the High 
D Court was wholly incorrect in declaring the provisions as ultra vires the 
constitUtion--Constitution of India, Arts. 15, 19( l)(c), 29 and 46. 
Daman Singh & Ors. v. State of Punjab & Ors., [1985] 2 SCC 640; 
Babaji Kondaji Garad Etc. v. Nasik Merchants Co-operative Bank Ltd., Nasik 
& Ors., [1984] 2 SCC 50; Toguru Sudhakar Reddy &Anr. v. Government of 
E A.P. & Ors., [1993] Supp. (4) SCC 439; Damyanti Naranga v. The Union of 
India & Ors., [1971] 3 SCR 840 and Lalit Narayan Mishra of Economic 
. Development and Social Change, Patna Etc. v~ State of Bihar & Ors., AIR 
(1988) SC 1136, relied on. 
F 
Hay v. Lord Provost of Perth, [1863] 4 Macq. HL (SC) 535, 544 and 
Re Beth/em Hospital, (1875) I.R 19 Eq; 457, cited. 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 603-04 of 
1997 Etc. 
G 
From the Judgment and Order dated 10.3.95 of the Allahabad High 
Court in C.M.W.P No. 40006 and 40121 of 1994. 
Yogeshwar Prasad, P.K. Bajaj and AK Srivastava for the Appel-
lants. 
H 
Raju Ramachandran, S. Markandeya, Ajay Singh, Ms. C. Markan-
380 
..... •; 
), 
_; 
-.; 
h 
STATE v. C.O.D. CHHEOKI EMPLOYEES' 
381 
deya, Ms. Meenakshi Aggarwal, Prashant Kumar, Sunil Ambwani, Ms. A 
Suman Bala Rastogi, S.C. Patel and Ms. Rani Chhabra for the Respon-
dents. 
The following Order of the Court was delivered : 
Impleadment and Intervention allowed. 
B 
Leave granted . 
We have heard learned counsel for the parties. 
These appeals raise an interesting question of law relating to the c 
validity of the Act and the Rules providing reservation for or nomination 
of weaker sections into the Co-operative Societies registered under the 
U.P. Co-operative Societies Act, 1965 (for short, the 'Act') and the U.P. 
Co-operative Societies Rules, 1968 (for short, the 'Rules'), as amended 
from time to time. 
D 
The question is : whether the U.P. Legislature has power to make 
the law to so amend the Act and the Rules as to provide for reservation 
to the weaker sections? The High Court declared Section 130(2) (xii) and 
(xii-A) and the provisions and the explanation to sub-rules (1) & (2) of 
Rule 393, Rule 393-A, Rule, 393-B, clause (d) of sub-rule (4) and part of E 
sub-rules (6) to (8) of Rule 440, so far as relating to the reservation of seats 
for weaker sections, sub-rule (3) of Rule 444-A and clause (i) of sub-rule 
(5) of Rule 453 as ultra vires the Constitution and accordingly quashed 
them. Calling in question this judgment of the High Court of Allahabad 
dated March 10, 1995 in CMWP Nos. 40006 and 40121 of 1994, these 
appeals have come to be filed. 
F 
Due to absence of representation of democratic character in the 
management of the co-operative societies on the basis of election by the 
general body of the society, the members of the weaker sections, namely, 
Scheduled Castes and Scheduled Tribes women and other backward clas- G 
ses do not find place. Consequently, the Government introduced amend-
ment to the Act. By adoption of the definition of "Other Backward Classes" 
contained in U.P. Public Services Reservation for Scheduled Castes and 
Scheduled Tribes and Other Backward Classes Act, 1994, brought Other 
Backward Classes within the ambit of weaker sections and made all of them 
members of the Committee of the Management of the Co-operative Society H 
382 
SUPREME COURT REPORTS 
[1997] 1 S.C.R. 
A 
registered under the Act so as to enable them to be elected or nominated 
as members. Section 4 of the Act prescribes the guidelines in the matter 
of formation of the Co-operative Societies and reads as under : 
B 
c 
D 
"4. Societies which may be registered - Subject to the provisions 
of this Act, a society which has as its object the promotion of the 
economic interest of its members in accordance with co-operative 
principles or a society established with the object of facilitating the 
operations of such a society, may be registered under th
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