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PETITIONER: GAJANAN NARAYAN PATIL AND ORS.

       Vs.

RESPONDENT: DATTATRAYA WAMAN PATIL AND ORS.

DATE OF JUDGMENT20/02/1990

BENCH: RAY, B.C. (J) BENCH: RAY, B.C. (J) KULDIP SINGH (J) SAHAI, R.M. (J)

CITATION:  1990 AIR 1023            1990 SCR  (1) 491  1990 SCC  (3) 634        JT 1990 (1)   517  1990 SCALE  (1)305

ACT:     Maharashtra  Cooperative Societies Act 1960--Section  27 and 73 ID read with Rule 57A and Bye Law of Society--Whether nominees  of financial institutions and  co-opted  Technical Directors  are entitled to vote and participate  in  special meeting.

HEADNOTE:     The appellants, elected Directors of the Sanjay Sahakari Sakhar Karkhana Ltd., signed a requisition and sent the same to  the  Respondent  3, Joint Director of  Sugar  and  Joint Registrar Cooperative Societies, Maharashtra State, request- ing him to summon a special meeting of the Committee of  the karkhana  to consider the proposed motion  of  no-confidence against the Chairman of the Committee, Respondent No. 1. The requisition  was  signed  by more than 1/3rd  of  the  total members  in accordance with the provisions of Clause (2)  of Sec. 731D of the Maharashtra Cooperative Societies Act 1960. On receipt of the said requisition, Respondent No. 3  issued a notice dated 13.9.1989 convening a special meeting of  the Committee of karkhana i.e. Board of Directors on  25.9.1989. The  said notice was issued to the elected members only.  No notice was sent to nominated members of the financial bodies or co-opted members. Respondent No. 1 filed a writ  petition before  the  High  Court and challenged the  action  of  the Respondent  No. 3 in not issuing the notice to the  co-opted members  and the member nominees of the  Financial  Institu- tions,  as according to him, those members are  entitled  to sit  and  vote  at the special meeting  when  the  committee considers  the vote of no-confidence under Section 73 ID  of the  Act. The High Court on consideration of the  provisions of Section 731D read with Rule 57A and bye-law No. 29 of the Bye  Laws of the Society, allowed the writ petition  holding that the three members of the second category who have got a limited  right to vote at a meeting except at a  meeting  to elect  Chairman or Vice-Chairman are entitled to  be  served with  notices of the special meeting and to  participate  in the  said meeting and as the two nominees of  the  Financial Institutions  and the expert co-opted members had  not  been served with the notice of requisition meeting, the  requisi-

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tion meeting could not be held. The High Court thus directed the  Registrar, respondent No. 3, to issue fresh notices  to the elected members as well as to the three Directors of the second 492 category before holding the meeting and accordingly disposed of  the  writ petition. The appellants thereupon  moved  the High  Court  and  obtained a certificate  of  fitness  under Article  134(1)  of  the Constitution and  have  filed  this appeal.     The main contention of the appellants is that the  nomi- nees of the Financial Institutions and the co-opted  members are not entitled to notice.     Dismissing  the appeal (by majority B.C. Ray and  Kuldip Singh, JJ.) this Court, HELD: (Per B.C. Ray, J.)     The right to participate in the special meeting as  well as  to  vote for such meeting is a statutory  right  and  it flows  from the provision of the Act, Rules and Bye-laws  of the Society. It has nothing to do with the democracy. [501E]     The  words ’entitled to sit and vote in any  meeting  of the  society’, refer to member to sit and vote not in  every meeting but in any meeting of the society. The only  express bar as provided in Section 27 is that the members, that  is, the Directors representatives of the Financial  Institutions as well as the expert Director (co-opted) are ’not competent to participate only in the election of members of the socie- ty. [501E-F]     The Directors have been conferred the right to  partici- pate  in  any meeting including the special meeting  of  the Board  of  Directors  or of the Managing  Committee  of  the society. [501G]     The requisition meeting that has been convened cannot be held as the representatives of the Financial Institutions in the  Board of Directors as well as the Expert Director  (co- opted) under the relevant provisions of Bye-law No. 29  have not  been  served with the requisition  notices  of  special meeting  convened  by the respondent No. 3 pursuant  to  the said requisition notice. [502B-C] (Per R.M. Sahai, J. --dissenting)     Sub-section  (i) of Section 73-D provides the manner  in which  Chairman  or Vice-Chairman who holds such  Office  by virtue  of his election may cease to hold it. It  also  pro- vides  the method of such removal by two-third  majority  of the total members of the committee 493 who,  are, for the time being, entitled to sit and  vote  in any  meeting  of the Committee. It is thus  clear  that  the right  to  remove and elect Chairman and  Vice-Chairman  has been restricted to only limited class of members. [504E-F]     Literal construction of expression ’entitled to sit  and vote’ if it results in negation of democratic process or  is against  logic and is fraught with danger of removal  of  an elected representative by nominees of financial institutions or government, then it has to be avoided. [504H; 505A]     Voting is sine qua non of election and under clause  (i) of sub-rule (7) of Rule 57-A, the decision to retain  Chair- man is arrived at by voting and such right namely, right  to vote  in election meeting being nonexistent in  nominees  of ’entitled  to sit and vote’ used in section 73 ID has to  be read as excluding such members from its ambit. [505E-F]     Such  reading  of the provision is  necessary  not  only because  it is more logical but also that is the outcome  of combined reading of subsection (9) of Section 27, Section 73 ID and Bye-law 29. [505F]

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   Jamuna Prasad Mukhariya and Ors. v. Lachhi Ram and Ors., [1955] 1 SCR 608 at 610--referred to.

JUDGMENT:     CIVIL  APPELLATE JURISDICTION: Civil Appeal Nos. 4676  & 4793 of 1989.     From the Judgment and Order dated 26.10.89 of the Bombay High Court in W.P. No. 3976 of 1989.     P.C. Jain, S.S. Ray, B.A. Mansodkar, Manoj Swarup,  P.H. Parekh,  J.H.  Parekh, Sunil Dogra.  A.M.  Khanwilkar,  V.D. Khanna and A.S. Basme, for the appearing parties. The following Judgments of the Court were delivered:     RAY,  J.  This  is an appeal under Article  133  of  the Constitution  of India against the Judgment and Order  dated October 26, 1989 passed by the High Court of Bombay in  Writ Petition  No. 3976 of 1989 whereby the High  Court  directed the Registrar of Cooperative Societies to give fresh  notice to the elected members as well as to the 3 persons namely  2 nominees  of the Financial Institutions and the  expert  co- opted member. 494     The  matrix of the case is that the appellants  who  are the  duly  elected Directors of the Sanjay  Sahakari  Sakhar Karkhana Ltd. hereinafter to be termed as "Karkhana"  signed a requisition and sent the same to the respondent No. 3, the Joint  Director  of Sugar and Joint  Registrar  Co-operative Societies, Maharashtra State, Pune requesting him to  summon a  special meeting of the Committee of the Karkhana to  con- sider  the  proposed  motion of  no-confidence  against  the Chairman of the Committee, Dattatraya Waman Patil,  respond- ent No. 1. This requisition was signed by more than 1/3rd of the  total members of the committee in accordance  with  the provision of Clause (2) of Section 73 ID of the  Maharashtra Cooperative Societies Act 1960 (Maharashtra Act No. XXIV  of 1961).  The above requisition was received in the office  of the Joint Director of Sugar and Joint Registrar, Cooperative Societies, Maharashtra State, Pune, the respondent No. 3.     On  6.9.1989 the respondent No. 3 issued a notice  dated September 13, 1989 convening a special meeting of the Manag- ing  Committee  of Karkhana i.e. Board of Directors  of  the Karkhana  on 25.9. 1989. This notice was issued  as  contem- plated  by  Clause  (3) of Section 73 ID of  the  Act.  This notice  was sent to all the members of the Committee of  the Karkhana  who at that time were entitled to sit and vote  at any meeting of the Committee i.e. the elected members of the said  Committee of Management. Over and above a copy of  the notice was sent to the office of Registrar, Deputy  Director of  Sugar,  Aurangabab (Presiding Officer). A copy  of  this notice was also sent to the office of the Managing  Director of  the  Karkhana  as by way of this  notice,  the  Managing Director had been directed to produce the minute book of the Committee  meeting and hand over possession thereof  to  the Presiding  Officer at the commencement of the special  meet- ing.     On 18.9.89 the respondent No. 1 filed writ petition  No. 3976 of 1989 before the High Court at Bombay challenging the requisition notice dated 5.9.89 signed by the 10  appellants who are elected members of the Managing Committee as well as notice  dated 13.9.89 issued by the respondent No. 3  mainly on the ground that under the scheme of the Act read with the Rules  and the bye laws of the Karkhana, coopted member  and nominees  of the Financial Institutions who are  members  of the  Board of Directors of the Karkhana and are entitled  to

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sit  and  vote  at the special meeting  when  the  Committee considers  the vote of no-confidence under Section 73 ID  of the  Act are required to be served with the said notices  of requisition enabling them to partici- 495 pate  in  the said special meeting. This writ  petition  was heard  by  the  Division  Bench  of  Bombay  High  Court  on 26.10.89. On a consideration of the provisions of Section 73 ID read with Rule 57A and bye-law No. 29 of the Bye-Laws  of the Society the High Court allowed the writ petition holding that  the  3 members of the second Category who have  got  a limited  right to vote at a meeting except at a  meeting  to elect  Chairman or Vice-Chairman are entitled to  be  served with  notices of the special meeting and to  participate  in the  said meeting and as the two nominees of  the  Financial Institutions  and  the expert Coopted members had  not  been served with the notices of requisition meeting the  requisi- tion meeting cannot be held. Instead of quashing the  notice issued  by the respondent No. 3 convening the  meeting,  the High  Court directed the Registrar, the respondent No. 3  to issue fresh notices to the elected members as well as to the 3  Directors of the Second category gory before holding  the meeting  and disposed of the writ petition accordingly.  The High Court however restrained the Chairman to enter into new contracts  and  as well as giving any  fresh  commitment  on behalf of the Karkhana.     The appellants filed a petition under Article 133 of the Constitution  of India against the Judgment and order  dated October  26, 1989 passed by the High Court, Bombay  in  Writ Petition  No.  3976 of 1989. The High Court by  Order  dated 26.10.89 granted certificate for appeal to this Court  under Article 134(1) of the Constitution of India on the following questions: "Whether the nominees of the Financial Institutions and  the expert  co-opted by the Committee under Bye-law 29  are  in- cluded within the expression "Committee members who are  for the  time being entitled to sit and vote at any  meeting  of the Committee?"     In order to decide the above question it is  appropriate to  consider  the  relevant provisions  of  the  Maharashtra Cooperative Societies Act 1960 to be hereinafter called  the ’Act’  and the rules framed thereunder as well as the  rele- vant  bye  laws  of the particular  Cooperative  Society  in question.     The  Karkhana is a Cooperative Society governed  by  the Maharashtra Cooperative Societies Act. Section 2(7)  defines Committee as the Committee of Management or Board of  Direc- tors  or  other directing body by whatever  name  called  in which the management of the affairs of the society is vested under Section 73 of the said Act. 496     Section  27  which deals with the voting powers  of  the members  provides in Sub-section ’9’ that no nominee of  the Government  or of my Financial Bank on any society shall  be entitled  to vote at any election of its Committee.  Section 73 states that 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  respec- tively  by this Act, Rules and the Bye-laws. Therefore,  the management  of  every Cooperative Society is vested  in  the Committee  of management or for that in the Board of  Direc- tors  of  the Society. Section 73 ID which is  relevant  for determination of the said question is quoted below: 73-ID "(1) A President, Vice-President, Chairman, ViceChair-

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man,  Secretary, Treasurer or any other officer by  whatever designation  called who holds office by virtue of his  elec- tion to that office shall cease to be such President,  Vice- President,  Chairman,  Vice-Chairman,  Secretary,  treasurer or any other officer as the case may be, if a motion of  no- confidence  is passed at a meeting of the committee by  two- third majority of the total number of Committee members  who are  for  the  time being entitled to sit and  vote  at  any meeting  of the committee and the office of such  President, Vice-President, Chairman, Vice-Chairman, Secretary, treasur- er or any other officer, as the case may be, shall thereupon be deemed to be vacant.           The requisition for such special meeting shall  be signed  by  not less than one-third of the total  number  of members of the committee who are for the time being entitled to sit and vote at any meeting of the committee and shall be delivered to the Registrar. The requisition shall be made in such form and in such manner as may be prescribed:  Provided that,  no  such requisition for a special meeting  shall  be made  Within a period of six months from the date  on  which any  of the officers referred to in sub-section (1)  as  en- tered upon his office. (3) The Registrar shall, within seven days from the date  of receipt of the requisition under sub-section (2), convene  a special meeting of the committee. The meeting shall be  held on a date not later than fifteen days from the date of issue of the notice of the meeting." 497 Rule  57A--Motion of no-confidence against the  officers  of the Society-- (1)  The  requisition  to call the special  meeting  of  the committee of a society to consider a motion of no-confidence against the President, Vice-President, Chairman,  ViceChair- man, Secretary, Treasurer, or other officer of the  society, by  whatever designation called, who holds office by  virtue of  his elections to that office, shall be made in  Form  M- 18. The requisition shall be accompanied by-- (a) the grounds of no-confidence, (b) the text of the motion of no-confidence to be moved, (c)  the  name of the committee members who shall  move  the motion of non-confidence, (d) a list of members of the committee specifying their full names, and address who are, for the time being, entitled  to sit and vote at any meeting of the committee, (e)  signatures of the members of committee who are  signing the requisition duly attested by the Chief Executive Officer of the society or Special Executive Magistrate or  Executive Magistrate or any Gazetted Officer of the Government. (2)  The  requisition referred to in sub-rule (1)  shall  be delivered  in person to the Registrar. Such  requisition  or requisitions  shall be delivered in duplicate in each  case. The Registrar on ascertaining that the requisition or requi- sitions,  as the case may be, have been signed by  not  less than  1/3rd members of the Committee who for the time  being are entitled to sit and vote in any ’meeting of the  commit- tee of society. (a) receive and acknowledge the requisition under his signa- ture with date and time, (b) issue notice, within 7 days from the date of receipt  of the  requisition,  convening the special  meeting  for  that purpose specifying therein place, date, time name and desig- nation of the officer who shall be presiding over such 498 meeting, to all the members of the Committee, the  Presiding Officer and the Managing Director, General Manager, Manager,

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Paid   Secretary,  Group  Secretary or such employee of  the society,  to  whom  the Registrar has  directed  to  produce minute  book  of  Committee meetings of  the  society.  This notice of no-confidence, shall also be issued, to the  offi- cer  or officers against whom the motion of noconfidence  is being  moved.  and shall be accompanied by the copy  of  the requisition along with enclosures and agenda. (5) The time of the meeting shall be between office hours of the authorised officer. The meeting shall be held either  in the  office of the Registrar or in the office of the  person authorised by the Registrar to preside over the meeting. (6) No other subject, except the motion or motions of nocon- fidence shall be kept on the agenda. (7d) The Registrar or the officer authorised to preside over the  meeting shall not allow any other person to  enter  the place  of meeting except the person or persons appointed  to assist him, the officer of the society who has produced  the minute book, the officer or officers against whom the motion of no-confidence is moved, the members of the committee  who are  for  the  time being entitled to sit and  vote  in  any meeting  of the committee, who are present at the  commence- ment of the meeting and police officer or officers if called by him to maintain the law and order. BYE LAW No. 29. Board of Directors:  A. xxxxxx B. xxxxxx to E. xxxxxx (F)  "Managing Director, and representatives  in  sub-clause (d) and (e) (Coopted Technical Director) shall not be  enti- tled to function as Chairman and Vice-Chairman. The 499 representatives  referred  to in above  sub-clause  (d)  and technical expert coopted as per provisions of sub-clause  (e and  Managing Director, will not be entitled to vote at  the meeting for the election for Chairman and Vice-Chairman  The representative of the State Government shall not be entitled to vote on any subject at any meeting of the Board, But  his opinion will be recorded in the minute book. He will not  be responsible  for mismanagement and negligence of the  Board. Further  no action can be taken against him for  any  losses sustained  to the Karkhana due to the mismanagement and  the negligence of the Board."     It  has been contended on behalf of the  appellant  that Section 27 sub-section ’9’ debars the Government nominee  or the nominee of any Financing Bank on any society to vote  at any  election  of the Committee of the Society and  as  such except the elected Directors other Directors can not partic- ipate  in  the  election of the Managing  Committee  of  the Society and cannot vote for such election. It has been  also submitted that under section 73 ID Clause (A) in the special meeting  convened for consideration of no-confidence  motion against  the Chairman and Vice-Chairman of the  society  and other  officers of the society only the members who are  for the  time being "entitled to sit and vote at any meeting  of the Committee may participate and vote in the said  meeting. It  has also been provided therein that as soon as  vote  of no-confidence is passed against the Chairman of the managing committee  of  the society by 2/3rd majority  of  the  total number  of  committee  members who are for  the  time  being entitled  to sit and vote the office of Chairman etc.  shall be  deemed  to be vacant. Therefore, it has  been  submitted that  the  word  at any meeting of the  committee  shall  be deemed to refer to all the meetings of the managing  commit-

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tee or the Board of Directors. The nominees of the Financial Institutions and also the coopted expert, coopted  Technical Director having been not entitled to function as a  Chairman and  Vice-Chairman  and not to vote at the  meeting  of  the election  for  Chairman and Vice-Chairman of  the  Board  of Directors  are not entitled to sit and vote in  the  special meeting  convened  for the purpose of consideration  of  the no-confidence  motion against the Chairman of the  Board  of Directors.  It  has also been contended in  this  connection that the Chairman of the managing committee or of the  Board of  Directors  is elected by the elected  Directors  of  the managing committee. It is against the democratic  principles that  the motion of no-confidence against the  Chairman  for removal  from  his elected office are to be  passed  by  the 2/3rd  majority  of the members of the  Board  of  Directors including the Directors who 500 are representatives of the Financial Institutions and expert nominee (co-opted),     Mr. S.S. Ray, learned counsel appearing on behalf of the respondent  No.  1 has on the other hand joined  issues  and submitted  that  the  right to participate  in  the  special meeting  convened for consideration of no-confidence  motion against  the Chairman is a statutory right flowing from  the provisions  of  the statute. This right has  been  conferred expressly by the provisions of section 73 ID read with  Rule 57A  Clause 2(b) read with Clause 7(D) i.e. "members of  the committee  who  are for the time being entitled to  sit  and vote  in  any meeting of the Committee." Though  Section  27 sub-section  9 enjoins that no nominee of the Government  or of  financing  bank or of any society shall be  entitled  to vote at any election of its committee. This merely means and signifies  that the nominee of the Government as well as  of the  Financial Institutions are not entitled to  participate in  the  election meeting of the society  and  from  casting their  votes in such meeting. Bye law 29 of the Bye Laws  of the  Society  provides that the Board of  Directors  of  the Karkhana would consist of the following members: S. No. Particulars                No. of Members. 1.  Members falling under Bye- -- elected producer,   11     law No.29(A)                  members, 2.  Members failing under Bye- -- elected by society  01     law No.29(B)                  members 3.  Members falling under Bye- -- Managing Director,  01     law No.29(C)                  Ex-officio. 4.  Members falling under Bye---  Representative of   01     law No.29(D)(i)               the financing agency. 5.  Members falling under Bye- -- Representatives of  01     law No. 29(D)(ii)             Indian Finance Corporation                                   of India, LIC, IDBI etc.                                   (Not more than two)                                   In the present case only. 6.   Members falling under    --  Representative of     NIL      Bye-law No. 29(D)(iii)       ICICI (One) In the                                   present case. 7.  Members falling under Bye- -- Nominee of the       01     law NO.29(D)(iv)              State Government 501 8.   Members falling under Bye- -- Expert nominee         01 law No. 29(E).                     (co-opted). 9.   Members falling under   -- elected from SC/      02      bye-law No. 29(G)       ST and Weaker      r/w section 73B         Section.                              Total Strength           19     It is also evident from the provisions of Bye law No. 29

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that the Representative of the State Government shall not be entitled to vote on any subject at any meeting of the Board, but  his opinion may be recorded in the minute book. So  far the  representatives referred to in Clause D(i) and  (D)(ii) in Bye-law No. 29, that is, representative of the  financing institutions as well as the expert nominee (co-opted)  fall- ing  under Bye-law 29(E) are entitled to participate in  the special  meeting and also cast their votes in such  meeting. This being the position, it is against the provisions of the Act,  Rules  and Bye-laws of the society to  hold  that  the members  falling under Bye-law 29(D)(i) and (ii) as well  as the  expert nominee (co-opted) under Bye-law 29(E)  are  not entitled  to  sit and vote in the meeting of  the  committee convened  for  consideration  of  the  no-confidence  motion against the Chairman, Board of Directors or for that of  the Managing Committee. This interpretation will be wholly going against  the clear meaning of the expression namely  members who  are  entitled  to sit and vote at any  meeting  of  the committee.  The right to participate in the special  meeting as well as to vote for such meeting is a statutory right and it  flows from the provision of the Act, Rules and  Bye-laws of the Society. It has nothing to do with the democracy. The words "entitled to sit and vote in any meeting o[ the socie- ty" refer to member to sit and vote not in every meeting but in  any  meeting  of the society. The only  express  bar  as provided  in  section 27 is that the members, that  is,  the Directors  representatives of the Financial institutions  as well as the Expert Director (co-opted) are not competent  to participate only in the election of members of the  society. The said Directors have been conferred the right to partici- pate  in  any meeting including the special meeting  of  the Board  of  Directors  or of the Managing  Committee  of  the society  ..  It  is appropriate to refer  of  Jamuna  Prasad Mukhariya and Others v. Lachhi Ram and Others, [1955] Vol. 1 S.C.R. 608 at 610. It has been observed: "The right to stand as a candidate and contest the  election is not a common law right. It is a special right created  by statute and can only be exercised on the conditions laid 502 down  by the statute. The Fundamental Rights Chapter has  no bearing on a right like this created by statute. The  appel- lants  have  no fundamental right to be elected  Members  of Parliament. If they want that they must observe the rules."     We  have  gone  through the  Judgment  rendered  by  our Learned  Brother,  Hon’ble Mr. Justice R.M.  Sahai,  we  are however,  unable to concur with the views expressed  by  our Learned  Brother  and the findings arrived  at  therein.  We therefore,  hold that the requisition meeting that has  been convened cannot be held as the representatives of the Finan- cial  Institutions in the Board of Directors as well as  the Expert Director (co-opted) under the relevant provisions  of Bye-law  No.  29 have not been served with  the  requisition notices of special meeting convened by the respondent No.  3 pursuant to the said requisition notice. The impugned notice convening  the special meeting is wholly illegal and  unwar- ranted. Furthermore, as we have found hereinbefore that  the two  Directors  representing the Financial  Institutions  as well as the expert nominee (co-opted) are entitled to parti- ciapate in the special meeting of the committee and also  to vote  at the same meeting as regards the  no-confidence  mo- tion,  the non-service of the notic of the said  meeting  on the  aforesaid  Directors renders the said  special  meeting illegal as there has been an infringement of the  provisions of  the  said Act, Rule 57A of the  Maharashtra  Cooperative Societies  Rules, 1961 and Bye-Laws 29D(i) and (ii) and  29E

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of  the Bye-Laws of the Society. We, therefore, dismiss  the appeal and allow the writ petition filed in the High  Court. The appellants will pay costs quantified at Rs. 5,000 to the respondents.     R.M. SAHAI, J. The short question of law that arises for consideration  in this appeal directed against the order  of Bombay  High  Court, is whether the  nominees  of  financial institutions  and co-opted Technical Directors who  are  not entitled  under  bye-law 29 of the  Sanjay  Sahakari  Sakhar Karkhana Ltd. (hereinafter called as ’Society’) framed under Maharashtra  Co-operative Societies Act, 1960  (for  brevity ’Act’)  either to function as Chairman or  Vice-Chairman  of the  Board of Directors of the Society or to vote  at  their election  are entitled to participate in a  special  meeting requisitioned  for consideration of motion of  no-confidence under Section 73 ID of the Act.     Resolution to requisition a special meeting to  consider motion  of  no-confidence  against Chairman  of  the  Board, signed  by more than 1/3rd members of the Board, was  deliv- ered to the Registrar as 503 required by Rule 57-A along with a list of members who  were entitled  to sit and vote. Notices on it were  issued  under Clause  (b) of sub-rule (2) of rule 57-A to elected  members only.  Validity of it and consequent proceedings were  chal- lenged  before  the High Court, amongst  others,  for  being violative of rule 57-A as it required the Registrar to issue notices  to  all members of the Board. Further  nominees  of financial institutions being vitally involved in the welfare of  the Society, their presence was essential for  effective and meaningful discussion even if they were not entitled  to sit and vote. Various other objections were raised. But  the High Court did not find merit in any except the one relating to non-issuance of notice to nominees of financial  institu- tions  and the expert co-opted by the Board. Reason  for  it was  wider  construction of the expression who are  for  the time  being entitled to sit and vote at any meeting  of  the committee"  used in section 731D of the Act. The High  Court found  that even though it would have been more  logical  to restrict  such  right to those alone who  were  entitled  to elect yet it widened the ambit of expression because if  two meanings  were possible then the meaning which extended  the right  to vote rather than that limited should be  accepted. It  also  found that right to vote on a  resolution  of  no- confidence being an important matter affecting the  Society, it  should be extended to even nominated members who  had  a right to vote at some meeting.     Bye-law 29 framed by the Society, gives out the  Consti- tution of the Board of Directors comprising of elected,  ex- officio, representatives, and co-opted members. But right to be elected as Chairman or Vice-Chairman of the Board or even voting at the meeting of such election has been confined  to elected members by clause (F) which is extracted below: "Managing Director, and (representatives in sub-clauses  (d) and (e) (Co-opted Technical Director) shall not be  entitled to  function as Chairman and Vice-Chairman. The  representa- tives  referred  to in above sub-clause  (d)  and  technical expert  director coopted as per provisions of subclause  (e) and  Managing Director, will not be entitled to vote at  the meeting  for the election of Chairman and ViceChairman.  The representative of the State Government shall not be entitled to vote on any subject at any meeting of the Board. But  his opinion will be recorded in the minute book. He will not  be responsible  for mismanagement and negligence of the  board. Further  no action can be taken against him for  any  losses

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sustained to the Karkhana 504 due to the mismanagement and the negligence of the board.  ’ ’     The  question  is how does it reflect on  the  right  to participate in a meeting of no-confidence against the Chair- man  of the Board? For this purpose it is necessary  to  ex- tract sub-section (1) of section 731D which reads as under: "A   President,  Vice-President,  Chairman,   Vice-Chairman, Secretary, Treasurer or any other officer by whatever desig- nation called who holds office by virtue of his election  to that  office shall cease to be such  President,  Vice-Presi- dent,  Chairman, Vice-Chairman, Secretary, Treasurer or  any other  officer, as the case may be, if a motion of  noconfi- dence  is passed at a meeting of the committee  by  twothird majority  of the total number of committee members  who  are for  the time being entitled to sit and vote at any  meeting of  the  committee and the office of such  President,  Vice- President, Chairman, Vice-Chairman, Secretary, Treasurer  or any  other officer, as the case may be, shall  thereupon  be deemed to be vacant."     This sub-section provides the manner in which a Chairman or  Vice-Chairman  who holds such office by  virtue  of  his election  may cease to hold it. It also provides the  method of such removal by twothird majority of the total members of the  committee who are, for the time being, entitled to  sit and  vote in any meeting of the Committee. It is thus  clear that the right to remove and elect Chairman and ViceChairman has  been restricted to only limited class of  members.  Who are they?     Elections  in  a  democracy have been  conceived  as  an instrument of selecting the best qualitatively superior  and politically valuable. Who should be entitled to reverse  the selection? Those who elect or any other numbers increased by any  methodology or law adding representatives and  nominees not  entitled to participate in selection. If the  value  of elective  process has to have primacy then those  worthy  of choice  should not be permitted to be squeezed out by  those who  are precluded from leadership or electing  the  leader. This basic concept does not stand altered or modified either by  any provision in the Act or Rules. Literal  construction of  expression ’entitled to sit and vote’ if it  results  in negation  of democratic process or is against logic  and  is fraught with danger of removal of an elected  representative by 505 nominees of financial institutions or government then it has to be avoided.     Reverting to statutory right the scheme of the Act  does not warrant the conclusion that such members are entitled to participate  in meeting requisitioned under section  73  ID. Sub-section (9) of Section 27 reads as under: "No  nominee of the Government or of any financing  bank  on any society shall be entitled to vote at any election of its committee."     It  clearly and unequivocally debars nominees of  finan- cial  institutions or Government representatives from  exer- cising any right to vote at any election meeting. Therefore, the  provisions in the bye-law debarring such a member  from voting  at ’election of Chairman or ViceChairman  cannot  be interpreted  to mean as permitting such  representatives  to vote at other election meeting as that may result in invali- dating the bye-law. Even if such ’members have some right to vote  in some meetings other than election meetings or  they have  a  right to record their opinion it does  not  entitle

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them  to participate or even served with notice of  vote  of confidence  as nature of meeting for considering  motion  of no-confidence  has all the characteristics both  in  content and effect of an election meeting. Voting is sine qua non of election and under clause (i) of sub-rule (7) of Rule  57-A, the decision to retain Chairman is arrived at by voting  and such right, namely, right to vote in election meeting  being non-existent  in  nominees of financial institutions  or  of Government the expression "entitled to sit and vote" used in section 73 ID has to be read as excluding such members  from its  ambit. Such reading of the provision is  necessary  not only because it is more logical but also that is the outcome of  combined reading of sub-section (9) of section 27,  sec- tion 73 ID and bye-law 29.     For these reasons, this appeal succeeds and is  allowed. The Writ Petition filed in the High Court is dismissed.  But there shall be no order as to costs. Y.    Lal                                             Appeal dismissed. 506