REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE/ORIGINAL JURISDICTION

CIVIL APPEAL NO.14678 OF 2015

VIPULBHAI MANSINGBHAI CHAUDHARY   …   APPELLANT

Versus

STATE OF GUJARAT & ANROTHER     …   RESPONDENTS

WITH

WRIT PETITION(C) No.824/2015 CIVIL APPEAL NO.13784/2015  CIVIL APPEAL NO  .1881/2016

J U D G M E N T

Chelameswar, J.

C.A NO.14678/2015, C.A. No.1881/2016 & C.A.No.13784/2015   

1. There are three appeals before us - two1 of them filed by

one  Vipulbhai  Mansingbhai  Chaudhary,  ('Chaudhary'

hereafter) and the third filed by the State of Gujarat & Others2.

2. The  matter  arises  under  the  Gujarat  Co-operative

Societies  Act,  1961  (for  short  'THE  ACT').   The  Mehsana

1    Civil Appeal Nos.14678 of 2015 and 1881 of 2016 2    Civil Appeal No.13784/2015.

District  Co-operative  Milk  Producers  Union  Ltd.  (hereafter

‘UNION’)  is  a  Society  within  the  meaning  of  the  expression

under Section 2(19)3 of THE ACT.  Chaudhary was elected as

its  Chairman for  a  period  of  three  years  commencing  from

2.5.2011  to  1.5.2014.   However,  he  continued  to  hold  the

office  beyond  the  period  of  three  years  by  virtue  of  the

operation of Section 74C(2) - as it then existed:

“Section 74C(2). When the election of all the members of the committee of any such societies held at the same time, the members elected on the committee at such general election shall hold office for a period of three years from the date on which the first meeting is held and shall continue in office until immediately before the first meeting of the members of the new committee.”

3. During  the  continuance  of  Chaudhary  in  the  office,  a

show-cause  notice  was  issued  on  12.1.2015  (hereafter

“Show-Cause Notice-I”)  by the Registrar4 of  the Co-operative

Societies (hereafter “the Registrar”) purporting to be one issued

under  Section  76B(1)  &  (2)  of  THE  ACT  calling  upon

Chaudhary to show cause why he should not be removed from

the office for various reasons mentioned therein.5  Chaudhary

3    Section 2(19). “Society” means a co-operative society registered, or deemed to be registered, under this Act;” 4   Section 2(17)  – “Registrar”  means  a  person  appointed  to  be  the  Registrar  of  Co-operative Societies under this Act; and includes to the extent of the powers of the Registrar conferred on any other person under this Act, such person and includes an Additional or Joint Registrar;

5   Though the notice purported to have been issued invoking both sub-sections (1) and (2) of Section 76B, there is no whisper in the said notice regarding the proposal to disqualify Chaudhary for a further period.

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challenged  the  said  show-cause  notice  by  way  of  a  writ

petition.    It  was  dismissed  by  the  Gujarat  High  Court  as

pre-mature.    The  dismissal  was  confirmed  by  a  Division

Bench  in  a  Letters  Patent  Appeal.  Aggrieved,  Chaudhary

carried  the  matter  to  this  Court  by  way  of  SLP  (Civil)

No.4668/2015 which was filed on 12.2.2015.  

4. During the pendency of SLP (Civil) No. 4668 of 2015, the

Registrar  passed  a  final  order  on  10.3.20156 by  which

Chaudhary was removed from the office and also disqualified

for a period of three years from holding “any office in any Sahakari

Mandal to participate in any election for a period of three years”.     

5. This  Court  by  an  order  dated  20.3.2015  disposed  of

SLP(C) No. 4668/2015 directing that status quo regarding the

order  of  the  Registrar  dated  10.3.2015  be  maintained  till

30.3.2015 to enable Chaudhary to approach the appropriate

forum  challenging  the  correctness  of  the  Registrar’s  order

dated 10.3.2015.   

6  …..Thus, taking into consideration the facts as a whole, because of the irregularities committed by him, the Union has suffered great financial damage and serious damage has been caused to the Mehsana Jilla Dudh Utpadak Sangh as well as the lacs of members providing milk in the milk societies connected with it and interests of the Pashu Palaks.   In such circumstances, I consider it proper to remove him from the post and also for the aforesaid reasons, think it proper to held him disqualified to have any office in any Sahakari Mandal or to participate in any election for a period of three years.

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6. Chaudhary  filed  a  statutory  revision  before  the  State

Government.   The  Government  by  its  order  dated  8.5.2015

confirmed the Registrar’s order dated 10.3.2015.

7. Aggrieved by the same, Chaudhary filed a Writ Petition

No.9618/2015.   A  learned  judge  of  the  High  Court  by  his

judgment dated 29.9.2015 upheld the action of the Registrar

insofar as it pertained to the removal of Chaudhary from the

office  but set  aside the  order  insofar  as it  pertained to  the

disqualification  of  Chaudhary  for  a  future  period  of  three

years.  It was held that proceedings under Section 76B(2) for

disqualifying Chaudhary could have been initiated only after

an order under Section 76B(1) is passed.  Since the Registrar

acted  on  the  basis  of  a  composite  notice  (Show-Cause

Notice-I),  the  action  of  the  Registrar  under  Section  76B(2)

could not be sustained.

8. Aggrieved by that part of the judgment in Writ Petition

No.9618/2015  insofar  as  it  went  against  him,  Chaudhary

preferred Letters Patent Appeal (LPA) No.1302 of 2015.  The

said  LPA  was  dismissed  on  19.10.2015.  Chaudhary

approached this  Court  by  way of  Special  Leave  Petition (C)

No.33630/2015 [now C.A.No.14678 of 2015].  

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9. In view of the fact that the High Court had set aside the

order of the Registrar disqualifying Chaudhary for a period of

three years,  the  Registrar  issued a fresh show-cause notice

dated  3.10.2015  (hereafter  ‘Show-Cause  Notice-II’)  calling

upon  Chaudhary  to  explain  as  to  why  he  should  not  be

disqualified for a future period in exercise of the powers under

Section 76B(2) of THE ACT.

10. The  said  show-cause  notice  was  challenged  by

Chaudhary  again by way of  another  Writ  Petition (SCA No.

17826 of 2015) unsuccessfully.7 Chaudhary carried the matter

in Letters Patent Appeal (LPA No.1343/2015)8.   

11. Eventually,  the  LPA  No.1343/2015  of  Chaudhary  was

allowed by the High Court  on 2.11.2015.  The Show-Cause

Notice-II was quashed holding:

“16. If the impugned order of the learned single Judge is examined  in  light  of  the  observations  made  by  us hereinabove, it can be said that the learned single Judge has committed  error  in  interpreting  the  provisions  of  section 76B(1) and 76B(2) of the Act and the consequential order for dismissal of the petitioner calls for interference.

17. As observed by us, if the second separate show cause notice is not contemplated as per section 76B(2) of the Act,

7    The writ petition was dismissed by a judgment dated 27.10.2015. 8   It  must be stated for the sake of the completion of the narration of the fact that during the pendency of the said LPA, the State made an oral application before the Division Bench to adjourn the matter to enable the Registrar to seek certain clarifications from the Single Judge.  Permission was granted. However, the Single Judge declined to give any clarification.

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and  both  the  consequences  should  arise  in  only  one proceeding under proceedings of  76B of  the Act, then the fact remains that the order for disqualification was quashed by  this  court  without  there  being  any  express  liberty reserved  for  continuation  with  the  proceedings  for disqualification under section 76B(2) of the Act.  Therefore, in light of the aforesaid observations and discussions, it can be said that  the  impugned action of  issuance of  separate show cause notice for disqualification under section 76B(2) of the Act is without jurisdiction and beyond the scope of section 76B of the Act.

and therefore concluded:

20. In  view  of  the  above,  the  impugned  notice  dated 3.10.2015 (Annexure-F) is quashed being beyond the scope and ambit of section 76B of the Act.  The order of the learned single Judge is set aside.  The appeal is allowed accordingly. Considering  the  facts  and  circumstances,  no  order  as  to costs.”

12. It can be seen from the above that the High Court held

that the Show-Cause Notice-II is untenable for the reason that

when the High Court had set aside the Show-Cause Notice-I,

it did not record that the Registrar is permitted to issue a fresh

show-cause notice proposing action under Section 76B(2).

13. Before  recording  such  a  conclusion,  the  High  Court

rejected two submission made on behalf of the Registrar:

(i) that in view of the fact that the earlier order of the

Registrar disqualifying Chaudhary was quashed on

the ground of breach of principles of natural justice,

it would still be open to the Registrar to issue show

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cause  notice  under  Section  76B(2)  of  THE  ACT.9

(ii) Chaudhary is estopped from arguing that the notice

under  Section  76B(2)  is  illegal  because  in  Writ

Petition  No.9618  of  2015,  Chaudhary  contended

that a composite notice under Section 76B(1) and

(2) proposing to remove Chaudhary from office and

disqualifying  him  for  a  further  period  from

contesting any election to the Society was illegal.  

14. The reasons of the High Court for rejecting the above two

submissions of the Registrar are recorded at para 18.1 and 19

respectively as follows:

“18.1  As such, the facts of all the aforesaid cases cannot be equated with the facts and circumstances of the present case as  narrated  hereinabove.  Further,  in  view  of  the interpretation  as  made  by  us  hereinabove,  if  only  one proceeding is contemplated under section 76B of the Act for two consequences of removal and disqualification, and those proceedings have ended in SCA No. 9618 of 2015 and LPA No. 1302 of 2015, it would not be open to the authority to initiate  second  proceedings  on  the  same  facts,  more particularly  when no  express  liberty  was so  reserved  and even otherwise also it could not be reserved in view of the interpretation  made  by  us  hereinabove.  Hence,  when

9     In support of that submission, the Registrar relied upon a large number of decisions.       Para 18 of the Judgment dated 02.11.2015 of the High Court of Gujarat in LPA No.1343 of

2015: “Mr.  Jani,  relied  upon  the  decisions  of  the  Apex  Court  in  M/s.  Guduthur  Bros.  Vs.  The

Income-tax Officer, Special Circle, Bangalore, reported at AIR 1960 SC 1326, in Superintendent (Tech. I) Central Excise, I.D.D. Jabalpur and Others vs. Pratap Rai reported at [(1978) 3 SCC 113], in  Anand Narain Shukla vs. State of Madhya Pradesh reported at (1980) 1 SCC 252, in M.V. Janardhan Reddy vs.  Vijaya  Bank and Others  reported  at  [(2008)  7  SCC 738] and  in Commissioner of Sales Tax and others vs. M/s. Subhash and Company reported at AIR 2003 SC 1628 … ”

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initiation of the second proceedings by issuance of the show cause notice is beyond the scope of section 76B of the Act, the said decisions would be of no help to Mr. Jani, learned AAG.”

19. Mr. Jani, learned AAG did attempted to contend that the appellant in the earlier round of litigation of SCA 9618 of 2015 had contended that separate show cause notice under Section 76B(2) of the Act was required to be issued and not the  composite  notice  under  section  76B(1)  &  (2)  and  he further contended that learned single judge having accepted the said aspect, it would not be open to the petitioner to play hot and cold at the same time, and now to contend that a composite notice was required, more particularly when the learned single Judge has accepted the said contention and the said order has been not interfered with in the LPA.”

15. In the meanwhile on 23.10.2015, a notification fixing the

dates for the election to the Managing Committee of the UNION

for  the  tenure commencing from 2015 to  2020 was issued.

Chaudhary  filed  his  nomination.   He  was  declared  elected

uncontested on 18.11.2015.   

16. Aggrieved by the judgment in LPA No.1343 of 2015 dated

2.11.2015  by  which  the  second  show-cause  notice  was

quashed by the High Court,  State of Gujarat and others filed

SLP(C) No. 32004 of 2015 (Civil Appeal No.13784 of 2015).  

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17. By an order dated 23.11.2015 of this Court, Chaudhary

was permitted to reply to the second show-cause notice10 and

he did infact file a reply.  Thereupon the Registrar passed an

order dated 16.12.2015 disqualifying Chaudhary for a period

of six (6) years.  

“Therefore, I, Nalin Upadhyay (IAS), Registrar of Cooperative Societies, Gujarat State, Gandhinagar, in exercise of powers conferred  upon  me  under  section  76(B)(2)  of  the  Gujarat Cooperative  Societies  Act,  1961,  declare  Mr.  Vipulbhai Mansingbhai Chaudhary, the then Chairman, the Mehsana District Cooperative Milk Producers Union Ltd., Mehsana, as disqualified to participate in any election or to hold any post in the Mehsana District Cooperative Milk Producers Union Ltd., Mehsana and also any other cooperative organization in the State, for a period of 6 (six) years from the date of this order.”

18. Aggrieved  by  the  same,  Chaudhary  filed  Writ  Petition

(SCA No.177 of 2016).  By the judgment dated 18.01.2016, the

same was partly allowed by a learned Single Judge:

“26. For  the  reasons  stated  above,  the  impugned  order dated 16.12.2015 is quashed only to the extent it imposes period of disqualification beyond 3 years.  Disqualification of the petitioner under section 76B(2) of the Act for a period of 3 years is not disturbed.  The petitioner, thus will have to suffer disqualification under section 76B(2) of the Act for a

10  This Court while granting leave in SLP (C) No.33630 of 2015 [arising out of the LPA No.1302 of 2015 arising out of WP No. 9618 of 2015] filed by Chaudhary ordered-  

“It  has  been  submitted  by  the  learned  senior  counsel  appearing  for  the  respondent (Chaudhary)  that  the  reply  to  the  second  show  cause  notice  is  being  filed  today.   In  these circumstances, we direct that if any order adverse to the respondent is passed by the Registrar, Cooperative Societies, State of Gujarat, the same shall not be implemented for a period of four weeks from the date of communication of the order to the respondent.”

By another order dated 26.02.2016, this Court while granting leave in SLP (C) No.3980 of 2016 filed by Chaudhary ordered:

“Leave granted. List this appeal in the month of August, 2016 for hearing. No interim relief. Tag with SLP (C) No.33630 of 2015 and connected matters.”

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period of 3 years from the date of the impugned order.  To the extent disqualification is imposed beyond 3 years,  the petition succeeds.  The petition thus finally stands disposed of accordingly.”  

19. Challenging the said judgment insofar as it went against

him, Chaudhary carried the matter in LPA No.55 of 2016.  A

division  bench  of  the  High  Court  by  its  judgment  dated

28.01.2016 declined to interfere with the Single Judge’s order.

“17. In view of the aforesaid observations and discussion, we find that no further case is made out for interference to the view taken by the learned Single Judge in the impugned order.  Hence, the appeal is disposed off accordingly with no order as to costs.”  

Hence, SLP (C)  No.3980/2016, now Civil  Appeal No.1881 of

2016.    

20. Following submissions are made on behalf of Chaudhary:

(i) The  order  of  the  Registrar dated  10.03.2015

had  been  set-aside  in  part  [insofar  as  it

pertained to action under  Section 76B(2)]  by

the  High  Court  in  Writ  Petition  No.9618  of

2015.  The same was allowed by the Registrar

to become final without any further challenge.

Therefore,  Show-Cause  Notice-II  could  not

have been issued in the absence of the grant of

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any leave by the High Court to issue a fresh

show-cause notice under Section 76B(2).

(ii) If  Show-Cause  Notice-II  is  illegal,  all  further

action  flowing  from show-cause  notice-II  are

void ab initio.  

(iii) Assuming for  the  sake of  argument  that  the

Registrar is  entitled  to  issue  show-cause

notice-II  and  take  consequential  action,  the

process  of  disqualifying  Chaudhary  invoking

power under Section 76B(2) is unsustainable,

because  each  one  of  the  acts  or  omissions

which  formed  the  basis  for  action  against

Chaudhary was either taken by or ratified by

the governing body (“committee”) of the society.

Therefore, action if at all required ought to be

taken against the entire governing body of the

society  under  Section  81  but  not  against

individual  members  thereof  under  Section

76B.   

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(iv) Alternatively, it is submitted that even if resort

to the power under Section 76B is permissible,

show-cause notice-II narrates the same set of

facts  and  gives  the  same  reasons  for  action

both under sub-sections (1) and (2) to Section

76B.   Such  a  course  of  action  is  not

permissible  under  law  as  the  considerations

relevant under Section 76B(1) for removing an

office bearer of the society from the office and

considerations which call for disqualifying an

office bearer under Section 76B(2) either from

holding any office or contesting an election to

the office must necessarily be different.

(v) Even if action under Section 76B(2) is tenable,

the  decision  of  the  Registrar  to  disqualify

Chaudhary  for  six  years  is  wholly

unsustainable  because  it  is  not  mandatory

under sub-section (2) to disqualify a person for

complete six years in every case.   

(vi) The order under Section 76B(2) must disclose

the reasons which prompted the Registrar to

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impose  a  disqualification  for  the  maximum

permissible period of six years.  The order is

absolutely  silent  in  this  regard  thereby

rendering the order wholly arbitrary.  

21. The State of Gujarat and the Registrar submitted:

(i) The Division Bench of the High Court grossly

erred  in  recording  the  conclusion  that

show-cause  notice-II  is  illegal  on the  ground

that it was issued without obtaining the leave

of  the  High  Court  when  it  had  partially

set-aside (in Writ Petition No.9618 of 2015) the

order dated 10.03.2015.

(ii) Except for the ipsi dixit of the High Court that

the Registrar is required to obtain leave of the

Court  before  issuing  show-cause  notice-II,

neither any principle of law nor any provision

of law which forms the legal basis for such a

proposition  is  referred  to  in  the  impugned

judgment.

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(iii) In the alternative, it is argued that Chaudhary

is estopped from advancing such an argument

in view of the fact he had challenged the order

of the Registrar dated 10.03.2015 insofar as it

pertained to Section 76B(2) on the ground that

such a notice could not have been issued in

exercise  of  the  power  under  Section  76B(2)

without  first  recording  a  conclusion  under

Section  76B(1)  that  he  was  required  to  be

removed from the office.

(iv) The findings recorded by the Registrar after an

elaborate inquiry, that various charges against

Chaudhary  are  proved,  are  findings  of  fact.

Those  findings  disclose  that  the  various

actions/omissions  held  proved  against

Chaudhary  are  prejudicial  to  the  interest  of

the society.  Therefore, they rightly formed the

basis  for  both  the  actions  i.e.  removal  of

Chaudhary  from  the  office  as  well  as  the

decision  to  disqualify  Chaudhary  under

Section 76B(2).

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(v) Assuming for  the sake of  argument that  the

various  actions/omissions  which  formed  the

basis for action against Chaudhary are either

with prior approval or subsequent ratification

of  the  Committee  of  the  UNION -  justifying

action under Section 81 of THE ACT, law does

not prohibit action against individual members

of the Committee.  On the other hand, Section

76B clearly provides for such a possibility.

22. A  brief  survey  of  the  two  provisions  of  THE  ACT  is

necessary to examine the various questions involved in these

appeals.    

23. Section 76B provides for (i) removal of “any officer”; and

(ii) disqualification of such a removed officer to hold or contest

election to any office either of that Society or any other Society

for a certain period.

“76B.  Removal  of  officer  –  (i)  If,  in  the  opinion  of  the Registrar,  any  officer  makes  persistent  default  or  is negligent in performance of the duties imposed on him by this  Act  or  the  rules  or  the  bye-laws  or  does  anything which is prejudicial to the interests of the society or where he stands disqualified by or under this Act, the Registrar may, after giving the officer an opportunity of being heard, by order remove such officer and direct the society to elect or appoint a person or a qualified member in the vacancy caused  by  such  removal  and  the  officer  so  elected  or

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appointed shall  hold office  so long only as the officer  in whose place he is elected or appointed would have held if the vacancy had not occurred.

(2)  The Registrar may, by order, direct that the officer so removed shall be disqualified to hold or to contest election for any office in the society  from which he is removed and in any other society for a period not exceeding six years from the  date  of  the  order  and such  officer  shall  stand disqualified accordingly.”

24. Section  81  authorises  (i)  the  supersession  of  the

Committee of a Society; and (ii) appointment of a substitute

committee or an administrator  to manage the affairs of  the

society  and  various  things  incidental  thereto.    Section  81

insofar as it is relevant for our purpose reads as follows:-

“Section 81(1) If in respect of a committee of a society having the Registrar as its member, the State Government and in respect of a committee of a Society which does not have the Registrar as its member, the Registrar, is of the opinion that;

(i) the committee persistently makes default; or

(ii) the committee is negligent in the performance of its duties imposed on it by or under this Act or the rules made thereunder or the bye-laws; or  

(iii) the committee has committed any act prejudicial to the interest of the society or its members;

the State Government or, as the case may be, the Registrar, after  giving the  committee  an opportunity  of  being  heard, within fifteen days from the date of issue of notice, by an order in writing, supersede the Committee and appoint–

(a) a Committee, consisting of one or more mem- bers of the society, not being the members of the com- mittee superseded under this sub-section, or

(b) an Administrator from amongst the officers of the Cooperation Department of the State Government –

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to  manage  the  affairs  of  the  society  for  a  period  not exceeding one year as may be specified in the order, which period may, at the discretion of the State Government or the Registrar, as the case may be, be extended from time to time, so, however, the term of the Committee or the Administrator shall be, the remaining term of the committee in whose place he is appointed or two years in aggregate, whichever is less.”

25. The expressions “committee”,  “officer” and “society”  are

defined expressions under Section 2(5), 2(14) and 2(19) of THE

ACT:

“Section 2(5) "committee" means the Managing Committee or the governing body of a society to which the direction and control  of  the  management  of  the  affairs  of  a  society  is entrusted to;

Section 2(14) “officer” means a person elected or appointed by a society to any office  of  such society according to  its bye-laws;  and  includes  a  chairman,  vice-chairman, president,  vice-president,  managing  director,  manager, secretary,  treasurer,  member  of  the  committee,  and  any other person elected or appointed under this Act, the rules or the bye-laws, to give directions in regard to the business of such society;

Section  2(19)  “society”  means  a  co-operative  society registered, or deemed to be registered, under this Act;”

Further analysis of Sections 76B and 81 would be undertaken

in the judgment at the appropriate place.

26. It  was  in  exercise  of  the  power  under  Section  76B.

Action  was  initiated  against  Chaudhary  initially  by  issuing

Show-Cause Notice–I which culminated in a final order dated

10.3.2015 by which Chaudhary was removed from the office of

the Chairman of the UNION and also disqualified for a period

17

of three years from holding any office or to participate in any

election “in any sahakari mandal”.11

27. The conclusions recorded by the Registrar, in the order of

dated 10.3.2015 removing  Chaudhary  from office,  remained

undisturbed by the High Court,  in Special  Civil  Application

No.9618/2015.  The High Court recorded (See paras 11 to 15

of the judgment) that of the various charges leveled against

Chaudhary, i.e. Charges Nos.2, 3, 6, 9, 10 and 11 had been

held proved by the Registrar.  The High Court further held that

such  findings  could  not  be  determined  in  exercise  of  the

jurisdiction under Article 226 of the Constitution of India.    

“16. The Court finds that in the nature of charges proved, the  view  taken  by  respondent  No.2  and  affirmed  by  the Revisional Authority is not to be disturbed in exercise of the powers  under  Article  226  of  the  Constitution  of  India  in absence  of  any  complaint  as  regards  decision  making process.   It  is  not  disputed  that  fair  and  sufficient opportunities were given to the petitioner and therefore, no complaint  could  be  made  as  regards  decision  making process to arrive at a decision by respondent No.2 to remove the petitioner in exercise of powers under Section 76B(1) of the Act.”

The said view of the learned Single Judge was endorsed by the

Division Bench in Letters Patent Appeal No.1302/2015.  The

11  See F/N 5  In view of the subsequent development, it is not necessary for us to examine the meaning of the

expression “sahakari mandal”.

18

Division  Bench  in  its  judgment  dated  19.10.2015  held  as

follows:

“3. Mr. Thakore, learned senior counsel appearing for the appellant, during the course of the hearing has taken us to the  impugned order  passed  by  the  authority  for  removal, which was subject matter of the petition before the learned Single Judge.  There are findings recorded by the authority pertaining to persistent default in performance of the duty by the appellant.  Those findings have been examined by the learned Single Judge to the extent of scope of judicial review in a  petition under  Article  226 of  the  Constitution.   It  is hardly  required  to  be  stated  that  while  undertaking  the exercise  of  judicial  review  under  Article  226  of  the Constitution in a matter of removal of an office bearer of the society  under  the  Act,  the  Court  would  examine  as  to whether the opinion arrived at for removal is supported by objective material or not.  Sufficiency of the material may not be  re-assessed  by  the  Court  nor  this  Court  would reappreciate the material  and record a different finding as that of the appellate court.  After having expressed the view for the scope of judicial review, when we have considered the contents of the impugned order passed by the learned Single Judge, it appears that no error has been committed by the learned Single Judge in affirming or not interfering with the order passed by the authority under Section 76B(1) of the Act  for  removal  of  the  appellant  as Chairman of  the Milk Producers Union.”

28. Civil Appeal No.14678 of 2015 [Arising out of SLP(C) No.

33630  of  2015]  challenging  the  correctness  of  the

above-mentioned  judgment  of  the  High Court  is  one  of  the

three  appeals  before  us.12  Therefore,  it  is  a  submission of

Chaudhary that we are required to examine the correctness of

12  In our opinion, LPA No.1302/2015 ought to have been dismissed on the simple ground that the said appeal had become infructuous.  Because admittedly the tenure of  Chaudhary as  Chairman of  the Society expired on 01.05.2014.  Therefore, SLP (Civil) No.33630/2015 was a futile exercise.  We only wonder as to how leave came to granted in the said SLP.   

19

the conclusion recorded by the Registrar that the charges 2, 3,

6, 9, 10 and 11 are framed against Chaudhary.  

In substance, the argument is that this Court should act

as  the  appellate  Court  to  determine  the  correctness  of  the

conclusion  drawn  on  the  basis  of  the  evidence  before  the

Registrar.  An  exercise  which  ought  not  to  be  normally

undertaken even by the High Courts in the jurisdiction under

Article 226 of the Constitution of India nor by this Court on

further appeal by leave under Article 136 of the Constitution.

29. The High Court rightly declined to interfere with those

findings.   We see no error in the decision of the High Court in

this regard.

We decline  to undertake the  exercise  of  examining the

correctness of the conclusions recorded by the Registrar.   

30. The order dated 10.3.2015 insofar as it pertained to the

future  disqualification  of  Chaudhary  was  set  aside  in  Writ

Petition No. 9618 of 2015.   

It was argued on behalf of Chaudhary that issuance of a

combined notice proposing action both under sub-sections (1)

and (2) of Section 76B is illegal.  Action under sub-section (2)

20

of Section 76B could be initiated only after conclusion of the

action under Section 76B(1).13

In terms of submission of Chaudhary, the learned Single

Judge formed the points for determination at para 20.14   

On the construction of Section 76B, the learned Single

Judge held as follows:

“21. … There is no concept of issuing notice in advance.  If such notice in advance is issued for the proposed action to follow the event to happen, it could be said that the action proposed is prejudged, predetermined and as a result of bias attitude.  In fact,  reading the language of sub-sections (1) and (2) of Section 76B of the Act independently, one would find that the legislature intended to pass two different and distinct  orders  at  two  different  stages.   In  both  the sub-sections,  the  words  “by  order”  are  used.  Therefore, removal of an officer is contemplated by order to be passed at  first  in  point  of  time  and  then  by  separate  order,  the Registrar may direct that the officer “so removed” shall be disqualified to hold or to contest election for any office in his own society or in any other society for a period which may be fixed by the Registrar within the ceiling limit and for such order to be separately passed, principles of natural justice, as stated above, are to be followed.”

13   “Para 19.  … the contentions raised on behalf of the petitioner are that there was no notice in the eye of law for proposed action of disqualification and that it  would be only after order for removal is passed, the action under Section 76B(2) of the Act could be taken and therefore, issuance of the combined notice under Section 76B(1) and (2) of the Act was not permissible. …”  14  “Para 20. … Therefore, in the context of the provision of Section 76B of the Act, the Court needs to  examined  whether  before  the  order  of  removal  could  be  made,  action  for  disqualification  under sub-section  (2)  could  be  initiated  and  whether  separate  order  is  required  for  disqualification  under sub-section (2) after serving the order of removal to the petitioner and whether mere reference to Section 76B(2)  in  the  show  cause  notice  for  removal  could  be  said  to  be  notice  for  proposed  action  of disqualification under sub-section (2).”

21

The  learned  Single  Judge,  therefore,  concluded  that  a

combined notice under sub-sections (1) and (2) of Section 76B

is untenable.15   

15  “Para 26. … Therefore, if separate order is to be made only after the order of removal is passed, there is no question of issuing any notice proposing disqualification with notice for removal.  The Court, therefore, finds that action taken for disqualification of the petitioner runs counter to the provisions of sub-section (2) of Section 76B of the Act.”

22

31. The  High  Court  also  examined  the  question  (on  the

assumption  that  even  if  a  combined  notice  is  not

objectionable) whether a combined notice issued to Chaudhary

complied with the principles of natural justice and concluded

that Chaudhary was “not asked to show-cause as to why he should

not be disqualified”.16

32. The State of Gujarat and the Registrar accepted the said

judgment and let it become final.   

33. Hence,  the  submission  of  Chaudhary  both  before  the

High Court and this Court that Show-Cause Notice-II  could

not have been issued without obtaining the leave of the High

Court.  Such a submission found favour with the High Court

in the judgment in LPA No. 1343 of 2015 when it was called upon

to determine the legality of Show-Cause Notice-II.

34. The High Court  did  not  assign any  reason for  such a

conclusion  nor  any  provision  of  law  or  precedent  which

warrants such a conclusion is referred to.  We find it difficult

to sustain the conclusion.   16  Para  27.  …whether  there  was  in  fact  a  notice  in  the  eye  of  law  for  proposed  action  of disqualification.  The show cause notice at Annexure-A is titled as ‘Show Cause Notice under Section 76(B)(1)(2) of the Act’.  However, in the language of the notice at Annexure-A, the petitioner was asked only to show cause why he should not be removed from the office of Chairman, and while asking the petitioner  to  show  cause  against  the  proposed  action  of  removal,  sub-section  (2)  is  mentioned  with sub-section (1) of Section 76B of the Act.  The petitioner is thus not asked to show cause as to why he should not be disqualified after his removal from the office of Chairman.”  

23

35. Any  statutory  power  could  “be  exercised  from time  to

time as occasion requires”.  Such a principle is recognised by

Section 1417 of the General Clauses Act, 1897 and Section 1418

of  the  Gujarat  General  Clauses  Act.   Power  conferred  on

Courts to adjudicate the rights and obligations of the parties is

an exception to the principle.  The doctrines of  res-judicata19

and double jeopardy20 prohibit the repeated invocation of the

jurisdiction  of  the  Civil  Courts  or  repeated  attempts  to

prosecute a person on the same set of facts constituting an

offence.  Whether power conferred by a statute on a body other

than a judicial body (i) could be exercised repeatedly? or (ii)

are there any legal limitations thereon? and (iii)  if  there are

17  Section 14. Powers conferred to be exercisable from time to time.- (1) Where, by any Central Act or Regulation made after the commencement of this Act, any power is conferred, then unless a different intention appears, that power may be exercised from time to time as occasions requires.     

(2). This section applies also to all Central Acts and Regulations made on or after the fourteenth day of January, 1887.

18  Section  14. Powers conferred on any Government to be exercisable from time to time.-   Where, by any Bombay Act or Gujarat Act made after the commencement of this Act, power is conferred on any Government then that power may be exercised from time to time as occasion requires.  19   Embodied in Section 11 of the Code of Civil Procedure, 1908. 20   Contained in Article 20(2) of the Constitution of India and Section 300 of the Code of Criminal Procedure, 1973.

        Constitution of India  Article 20. Protection in respect of conviction for offences.— (2) No person shall be prosecuted

and punished for the same offence more than once          The Code of Criminal Procedure, 1973  

Section  300. Person once convicted or acquitted not to be tried for same offence.- (1) A person who has once been tried by a Court of competent jurisdiction for an offence and convicted or acquitted of such offence shall, while such conviction or acquittal remains in force, not be liable to be tried again for the same offence, nor on the same facts for any other offence for which a different charge from the one made against him might have been made under sub- section (1) of section 221, or for which he might have been convicted under sub- section (2) thereof.

24

limitations thereon what are they? are questions which require

further examination.  But for the purpose of this case these

questions need not be examined.  It is already held by this

Court  that  where  an  order  passed  in  exercise  of  a  power

conferred by a statute is set aside on the ground that such an

order was passed in breach of the principles of natural justice,

the power could once again be exercised by complying with the

principles of natural justice.  

36. A Division Bench of the Andhra Pradesh High Court in

Thimmasamudram Tobacco  Co. v. Assistant  Collector  of

Central Excise, Nellore Division, Nellore, AIR 1961 AP 324,

held that:  

“… in a case where the flaw in the order appealed against consists of in the non-observance of certain procedure or in not  giving effect  to the maxim ‘audi  alteram partem’,  it  is open to  the  officer  concerned to  start  the  procedure  once again with a view to follow the rules of procedure and the principles of natural justice.”   

The  said  principle  laid  down  by  the  Andhra  Pradesh  High

Court was approved by this Court in Superintendent (Tech.I)

Central  Excise  I.D.D.  Jabalpur & Others v.  Pratap Rai,

(1978) 3 SCC 11321. 21  Superintendent (Tech.I) Central Excise I.D.D. Jabalpur & Others v. Pratap Rai, (1978) 3 SCC 113

“Para 6.  In the case of Thimmasamudram Tobacco Co. v. Assistant Collector of Central Excise, Nellore Division, Nellore [AIR 1961 AP 324] while construing the provisions of the Central Excise and Salt Act which was almost on identical terms as the Customs Act, a Division Bench of the Andhra Pradesh High Court observed as follows (AIR p. 325, para 11):

25

37. Inspite of the fact that the abovementioned judgment of

this Court was cited, the Division Bench of the High Court in

L.P.A.  No.1343  of  2015  quashed  the  show-cause  notice-II

dated 03.10.2015 on the ground:

“  …  Further,  in view of  the interpretation as made by us hereinabove, if  only one proceeding is contemplated under section 76B of the Act for two consequences of removal and disqualification, and those proceedings have ended in SCA No. 9618 of 2015 and LPA No. 1302 of 2015, it would not be open to the authority to initiate second proceedings on the same facts, more particularly when no express liberty was so reserved and even otherwise also it could not be reserved in view of the interpretation made by us hereinabove …”.

The said conclusion is clearly untenable and is required to be

set-aside and the first submission of Chaudhary is liable to be

rejected.  As a consequence, the second submission also falls

to ground.

38. We  shall  now  deal  with  the  third  submission  of

Chaudhary.  The submission in substance is that the acts and

omissions  which  formed  the  basis  of  allegations  leading  to

“Assuming that Section 35 of the Central Excise Act does not clothe the appel- late authority with power to remand the matter to the officer whose order is appealed against, nothing stands in the way of the Assistant Collector initiating the proceedings afresh, when his order was quashed not on merits but on technical grounds i.e. for not fol- lowing either the procedure or the dictates of natural justice. In a case where the flaw in the order appealed against consists of in the non-observance of certain procedure or in not giving effect to the maxim ‘audi alteram partem’, it is open to the officer concerned to start the procedure once again with a view to follow the rules of procedure and the princi- ples of natural justice.” We find ourselves in complete agreement with the view taken by the Andhra Pradesh High Court

and the observations made by Reddy, C.J. who spoke for the Court.”

26

action  against  Chaudhary  under  Section  76B  are  not  the

individual  acts  of  Chaudhary  but  the  collective  acts  or

omissions of the Committee of the UNION.  Therefore, action if

at all  required must be taken under Section 81 against the

entire Committee but not only against Chaudhary.  In absence

of  any  action  against  the  Committee,  action  against

Chaudhary is illegal and unsustainable.

39. The text of both the Sections 76B and 81 is already taken

note  of.  Section  81  authorises  the  supersession  of  the

Committee of a Society.  Section 76B authorises action against

individual  officers  of  a  Society.  In  either  case,  action  is

required to be taken upon the formation of the opinion by the

Registrar22 that  (i)  there  is  a  persistent  default;  or  (ii)

negligence in the performance of duties; or (iii) commission of

an act which is prejudicial to the interest of the Society or its

members.      

40. Committee  of  a  cooperative  society  by  definition23 is  a

body to which “the direction and control of the management of

the affairs of a Society is entrusted to” - though under Section

22  Or the Government in certain cases the details of which may not be necessary for the present purpose. 23  See Section 2(5) in para 25 (supra)

27

73 of THE ACT, the final authority of every Society shall vest in

the general body of members.  Section 7424 declares that the

management  of  every  society  shall  vest  in  a  committee

constituted in accordance with THE ACT etc.  The Section also

declares  that  the  committee  shall  “exercise  such  powers  and

perform such duties” (hereafter collectively - DUTIES) as may be

conferred or imposed on it  by THE ACT or the subordinate

legislation  made  thereunder.   Performance  of  DUTIES

normally obligates a committee to take or desist from taking

certain courses of actions.  Failure of committee to perform its

DUTIES attracts  various legal  consequences specified under

THE ACT.  One of the consequences is specified under Section

81.

41.  Committee  is  nothing  but  a  collective  name  for  the

conglomeration  of  the  individual  officers  of  the  society.  An

“officer” by definition25 is either a person elected or appointed

under  THE  ACT,  or  the  subordinate  legislation  made

thereunder to give directions in regard to the business of such

society.   

24  Section 74.  Committee, its powers and functions.—(1)  The management of every society shall vest in a committee, constituted in accordance with this Act, the rules and bye-laws, which shall exercise such powers and perform such duties as may be conferred or imposed on it respectively by this Act, the rules and the bye-laws. 25  See Section 2(14) in para 25 (supra)

28

42. Committees are inanimate bodies. They function through

human agency i.e. the individual members of the Committee.

When it is said that a committee failed to perform its DUTIES

under THE ACT, it is essentially the failure of the officers of

the society collectively.  

Failure  of  the  Committee  to  perform  its  DUTIES

necessarily implies failure on the part of the majority (if not

the entire body) of the members of the Committee to perform

DUTIES which they are obliged to perform under THE ACT in

their capacity as the members of the Committee.

Acts or omissions of individual members which are not

consistent  with  the  DUTIES of  the  Committee  or  individual

members  entail  various  legal  consequences  specified  under

THE ACT both to the individual members and the Committee.

Individual members of the Committee owe DUTIES some

of which are required to be performed individually26 and others

in concert with the other members of the Committee.  

26  An officer is obliged to attend the meetings of the  Committee and participate in the decision making process.  Failure to attend and participate in such meetings may attract legal consequences – if so prescribed by THE ACT or subordinate legislation made thereunder.   

29

43. Committee by definition owes a duty to give directions in

regard  to  the  business  of  the  society.   That  DUTY  of  the

Committee in substance is the DUTY owed by the individual

members  of  the  Committee  collectively.   The  legality  of  the

directions  given  depends  upon  the  nature  of  the  various

DUTIES to be performed by the Committee.  Failure to give

directions may also constitute an illegal omission (failure to

perform a DUTY) in a given case.   

In a given case, if a decision taken by the committee is so

patently  prejudicial  to  the  interest  of  the  society  calling  for

action under  Section 81,  there  is  a  collective  failure  of  the

individual  members  of  the  committee  to  perform  their

respective  duty  to  give  right  directions  in  regard  to  the

business of the society.  Registrar is authorised to supersede

the committee and appoint an administrator.  If such course of

action is proposed by the Registrar, it will not be open to an

individual member of the committee to argue that he was not a

party  to  such  an  objectionable  conduct  of  the  committee

because either he abstained from the decision making process

or disagreed with the objectionable course of action taken by

the other (majority) members of the committee and therefore,

30

there is no individual culpability on his part.  Section 81 of

THE ACT authorises collective action against all the members

of  the  committee.  The collective  failure  of  the  committee  in

performing its duty is such that warrants supersession of the

committee. All individual officers lose their offices irrespective

of their contribution to the culpable action of the committee.

Even in such cases of the failure of the committee to perform a

DUTY owed by it, it may not be necessary to supersede the

entire committee (in a given case) if it can be ascertained that

the  failure  occurred  due  to  culpable  act  or  omission  of  an

individual  member  of  the  committee  and  other  members

though acquiesced, did not have any culpable motives.    

In a given case an act or omission of the committee may

also constitute a failure of the performance of duty on part of

each individual member of the committee, who contributed to

such failure of duty.  Law can provide for action to be taken

against each of the members of the committee.  In such a case

whether  it  is  compulsory  to  take  action  against  all  the

members who contributed to the culpable action is a matter

which depends upon the scheme and tenor of the law.   

31

Sections 76B and 81 provide for such a courses of action.

The Registrar is conferred with a discretionary power to take

action against officers/members of the Committee individual

or against the Committee collectively.   

It is essentially for the Registrar to make an assessment

whether on the facts and circumstances of each case either

action is to be taken against the committee or an individual

officer or both.  The decision of the Registrar taken in exercise

of  such  discretionary  power  would  not  be  amenable  to

challenge on the ground that the Registrar failed to take action

under both Sections 76B and 81 unless the individual member

against whom action is proposed pleads and proves mala fide.

Individual members cannot complain that since the Registrar

is not proposing action collectively against the committee, he

could  not  initiate  action against  individual  members  of  the

Committee.   

44. In substance, THE ACT envisages joint and several action

against  the  officers  in  their  capacity  as  members  of  the

committee.   While  Section  81  is  designed  to  deal  with  the

dereliction of the duties by the committee as a body, Section

76B  deals  with  the  dereliction  of  duties  of  the  individual

32

members of the committee.  The Registrar is invested by THE

ACT with the discretion to choose the proper course of action

depending upon the situation.  The argument of Chaudhary is

not that the Registrar abused his discretion.  The submission

is that it is not permissible for the Registrar to resort to action

only under Section 76B.  We reject the submission.   

45. We  shall  now  examine  the  fourth  submission  of

Chaudhary  that  the  reliance  upon the  same set  of  facts  in

both  Show-Cause  Notices-I  and  II  would  render  the

Show-Cause  Notice-II  and  the  action  consequent  thereupon

illegal.

At the outset, we must state that we have examined the

tenor of both the show-cause notices and we proceed on the

basis that the tenor of both of them is substantially the same

if not identical.    

46. Section 76B(1) contemplates removal of an officer of a so-

ciety if the Registrar is satisfied that such an officer is guilty of

any one of the misconducts specified under the section.  Sub-

33

section (2) further authorises the Registrar to disqualify such

an officer either to contest or to hold any office in that society

from which the officer is removed and also in any other society

for a period to be specified by the Registrar subject to a statu-

tory outer limit.

From the language of  sub-section (2),  it  appears to us

that  the  Registrar  is  not  obliged  to  disqualify  every  officer

against  whom an order  of  removal  under  Section 76B(1)  is

passed. Going by the text of sub-section (2) which says that

the  “Registrar  may  …direct  that  the  officer  so  removed  shall  be

disqualified…..”, the power to disqualify is discretionary.   

The basic requirement of sub-section (2) is that the power

thereunder  could  be  exercised  only  against  an  officer  of  a

society who has already been removed from office.  Therefore,

the factual  basis on which the action under sub-section (1)

and sub-section (2) of Section 76B is to be taken is bound to

be  the  same though the  reasons and logic  on the  basis  of

which action under either of the sub-sections is to be taken

could be different.  Depending upon the intensity and gravity

of the misconduct in a given case, mere action [under Section

76B(1)] of removal from office might suffice and meet the ends

34

of  justice.   Whereas  in  some  cases  action  under  both  the

sub-sections might be called for.  But in no case action only

under  Section  76B(2)  is  permissible  without  taking  action

under Section 76B(1).  It is also possible that in a given case,

facts may not only justify but also oblige the Registrar to pass

not only an order of removal under sub-section (1) but also an

order of disqualification under sub-section (2) depending upon

the nature of the misconduct and the legal obligation flouted

by the officer.     

It all depends upon the facts and circumstances of each

and every case and the scheme of the law relevant to such

facts.  The variables are too many.

47. On the  facts  of  the  present  case,  Chaudhary  is  found

liable  to  be  removed  from  office  on  various  charges  which

according to the Registrar tantamount to (i) negligence on the

part of  Chaudhary in performance of  his  duties under THE

ACT or the subordinate legislation therein, and (ii) indulgence

in acts which are prejudicial to the UNION.

Such  conclusions  are  based  on  an  inquiry  where

evidence  was  gathered.   The  order  of  the  Registrar  dated

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10.3.2015 by which Chaudhary was removed from office of the

Chairman  of  the  Society  was  approved  by  the  State

Government  (Revisionary  Authority  under  THE  ACT).

Chaudhary  unsuccessfully  questioned  the  same  in  Writ

Petition  No.  9618  of  2015.   The  further  challenge  of

Chaudhary was rejected in LPA No. 1302 of 2015.27   

48. For the purpose of passing the order of disqualification

under Section 76B(2) against Chaudhary, the Registrar rightly

proceeded on the basis that there is an earlier order of  the

Registrar dated 10.3.2015 where charges against Chaudhary

had been held proved and the High Court declined to interfere

with those findings.  He, therefore, opined that he is entitled to

proceed to take action under Section 76B(2) on the basis of the

same  conclusions  which  rendered  Chaudhary  liable  for

removal from office under Section 76B(1).  In the process, both

in the show-cause notice–II and the order dated 16.12.2015,

the  Registrar  once  again  repeated  all  the  allegations  which

formed the basis for the order under Section 76B(1).    

In our opinion,  it  was not really necessary.    It  would

have  sufficed  if  the  Registrar  mentioned  the  fact  that

27  The details of which are discussed by us in Paragraphs 27 and 28 supra.

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Chaudhary was removed from the office of  Chairman of the

Society in exercise of  the power under Section 76B(1) -  the

mention of  such a fact is also not mandatory.  It is only a

condition precedent for initiating action under Section 76B(2).

The requirements of valid notice under Section 76B(2), in our

opinion,  are  that  the  notice  should  indicate  broadly  the

reasons which prompt the Registrar to initiate action and the

period  for  which  the  person,  against  whom  the  action  is

initiated,  is  proposed  to  be  disqualified.   However,  the

mentioning of the past history though avoidable does not in

any way vitiate the show-cause notice or the final order if they

are otherwise in accordance with law.

49. In our opinion, there is no legal infirmity either in the

logic  adopted  by  the  Registrar  or  the  action  taken  by  him

under Section 76B(2) on the ground that the Registrar relied

upon  the  same  set  of  facts  and  the  conclusions  drawn

thereupon for  taking  action both under  Section 76B(1)  and

Section 76B(2).    

In Show-Cause Notice-II, it is indicated that Chaudhary

is  proposed  to  be  disqualified  under  Section 76B(2)  on  the

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ground he “committed serious type of administrative and financial

irregularities as a consequence thereof,  the Sangh28 has suffered

financial  loss  on  large  scale  …..”  –  a  statement  made  on the

basis  of  the  previous  history  of  the  litigation.   It  further

indicated in the Show-Cause Notice that the Society of which

Chaudhary  was  the  Chairman  is  the  largest  UNION of  the

State with 4.5 lakhs milk producers who are members of 1097

milk  producers  cooperative  societies29,  therefore,  there  is  a

need to disqualify Chaudhary from holding or contesting for

any post in any society.   

28   Society 29   The Mehsana Jilla Sahakari Dudh Utpadak Sangh Limited is the largest Union of the State with which, larger interest of about more than 4.50 lacs milk producers and 1097 milk producers cooperative societies is connected.  In such circumstances, it is appearing proper that you are not only removed from the office bearer  in the cooperative movement but to see that you may not participate in such activity and the damage is not caused to the cooperative establishment because of your such activity, it is necessary to keep you away from assuming the office in any cooperative establishment by participating in the election maximum for a period of six years.   

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The mention of the facts   

(i)   That  on  account  of  the  misconduct  of

Chaudhary, the UNION suffered financial loss on

a large scale;

(ii)   That  the  UNION  consists  of  various

smaller  societies  each  of  which  has  a  large

number of milk suppliers; and

(iii)    That  the  Registrar’s  proposed  to

disqualify Chaudhary for maximum period of six

years,  

in  our  opinion,  makes  the  Show-Cause  Notice-II

sufficiently  compliant  with  the  requirement  of  Section

76B(2).

50. The final order disqualifying Chaudhary was passed after

due compliance with the principles of natural justice.  If the

Registrar came to the conclusion that Chaudhary should not

be permitted to contest any election or hold any office in any

society functioning under THE ACT, the  same,  in our view,

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can’t  be  found  fault  with.  Because  Chaudhary  has  already

been found guilty of conduct which resulted in a large scale

financial irregularities in the conduct of the business of the

society and also financial loss to the society.  The activity of

the  UNION  is  spread  over  in  three  districts.   The  UNION

consists of a large number of primary societies.  Disqualifying

Chaudhary only from the holding post in the UNION is to give

him a chance to meddle with the affairs of the societies which

are members of the UNION.    

51. The  only  other  question  remaining  to  be  examined  is

whether the period of disqualification of six years is consistent

with law.

Section 76B(2) as of today provides for disqualification of

an officer for a period not exceeding six years.  Originally the

Section provided for disqualification only for four years.  But

the “four years” period was substituted by “six years” period

by the Gujarat Co-operative Societies (Amendment) Act, 2015

(Act No.12 of 2015).   

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52. All  the acts  and omissions which formed the basis for

action against Chaudhary pertained to the period anterior30 to

the Act No.12 of 2015.  Under Section 7 of the Gujarat General

Clauses  Act,  it  is  provided  that  where  an  enactment  is

repealed  by  a  subsequent  enactment,  the  repeal  does  not

normally  affect  any  investigation  or  legal  proceedings  in

respect  of  any  right,  privilege,  obligations,  liability,  penalty,

forfeiture  or  punishment  and  any  legal  proceeding  initiated

during  the  currency  of  the  repealed  enactment  could  be

continued as if the repealing Act has not been passed.   

Repeal could be either of the entire enactment or a part

of it.  Substitution of parts of an enactment is nothing but pro

tanto to repeal those parts.

Normally  when  an  enactment  is  repealed,  any  action

initiated  under  that  enactment  dealing  its  currency  should

lapse.  Because the authority of law for action initiated under

an  enactment  ceases  to  exist  on  its  repeal  rendering  the

continuation of action without authority of law.  To meet such

a  contingency,  the  General  Clauses  Act  made  a  provision

30  Show-Cause Notice-I is dated 12.1.2015 and the Act No.12 of 2015 came into force on 7th April  2015.

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under  Section  7.   It  seeks  to  preserve  various  rights  and

obligations acquired or incurred under repealed enactments. It

also  provides  for  various  other  things  incidental  to

preservation of such rights and obligations31.  

53. As a logical corollary to the above proposition, no right or

liability  can be  created by  a  repealing  enactment,  which is

inconsistent with the rights and obligations conferred under

the  repealed  Act  unless  the  repealing  enactment  makes an

express  declaration  to  that  effect  or  adopts  some  other

technique  known  to  law  to  achieve  that  purpose.   Giving

retrospective effect to the repealing enactment is  one of  the

techniques  by  which  the  legislature  seeks  to  achieve  that

purpose.  

54. There is nothing in Act No.12 of 2015 which warrants an

interpretation  that  the  legislature  intended  to  create  a

31  Section 7 of The Gujarat General Clauses Act, 1904: “Section 7. Effect of repeal.- Where this Act, or any Bombay Act or Gujarat Act made after the

commencement of this Act, repeals any enactment hitherto made or hereafter to be made, then unless a different intention appears, the repeal shall not-  

(a)  revive anything not in force or existing at the time at which the repeal takes effect; or  (b) affect the previous operation of any enactment so repealed or anything duly done or suffered

thereunder; or  (c)  affect  any right,  privilege,  obligation  or  liability  acquired,  accured  or  incurred  under  any

enactment so repealed; or  (d)  affect  any penalty, forfeiture or  punishment  incurred in  respect  of  any offence committed

against any enactment so repealed; or (e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege,

obligation, liability, penalty, forfeiture or punishment as aforesaid, and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed, as if the repealing Act had not been passed.”

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disqualification which would run for a maximum period of six

years with retrospective effect. The learned Additional Solicitor

General Shri Mehta fairly accepted it.  In the circumstances,

the disqualification of six years upon Chaudhary is not tenable

and at best Chaudhary could be disqualified for a maximum

period of four years.  

55. It is next argued on behalf of Chaudhary that the order

dated 12.10.2015 does not disclose reasons which prompted

the Registrar to impose the maximum penalty and, therefore,

that  order  is  vitiated.  We  do  not  wish  to  examine  the

submission for the reason the judgment under appeal thought

it fit that disqualification of Chaudhary for a period of three

years would meet the ends of justice.  We are of the opinion

that having regard to the acts and omissions of  Chaudhary

forming  the  basis  of  disqualification  cannot  be  said  to  be

unreasonable.

56. In the result, appeals of Chaudhary fail and appeal of the

State is disposed of in terms of the above.    

Writ Petition (Civil) No.824 of 2015 filed by Chaudhary is

dismissed as not pressed.

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In the facts and circumstances of the case, there will be

no order as to costs.

..….....................................J.      (J. CHELAMESWAR)

……. ………….....................J.      (ABHAY MANOHAR SAPRE)

New Delhi April 17, 2017

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