Satish Kumar Mittal, J.@mdashThe petitioner has filed this petition under Articles 226/227 of the Constitution of India for quashing the order
dated 11.4.2008, passed by the Assistant Registrar, Co-operative Societies, Gurgaon, whereby a show cause notice was given and further in
exercise of the power under Sub-section (2) of Section 34 of the Haryana Co-operative Societies Act, 1984 (hereinafter referred to as ''the Act''),
the Managing Committee of the Engineers Co-operative Group Housing Society Ltd., Gurgaon (hereinafter referred to as ''the Housing Society'')
has been placed under suspension, and for smooth running of the society, the Board of Administrator has been appointed u/s 33(1) of the Act, for
six months.
2. In this case, a complaint was received by the Assistant Registrar, Co-operative Societies from certain members of the Housing Society. On the
said complaint, notices were issued to the complainant as well as the Housing Society. In spite of the notice, neither any representative of the
Housing Society came present nor record of the Housing Society was produced. Again, a notice was issued to the petitioner, who is the President
of the Housing Society, to produce the entire record, but on that also, no record was produced before the Assistant Registrar for his inspection. In
light of all these facts, the Assistant Registrar issued notice under Sub-section (1) of Section 34 of the Act to show cause as to why the Managing
Committee of the Housing Society be not removed, as the Managing Committee was persistently making defaults in the performance of duties
imposed on it by the Act. While proceeding to take action under Sub-section (1), the Assistant Registrar also passed the order of suspension of
the Managing Committee, after framing opinion that in the interest of the Society, the Managing Committee is to be suspended. The petitioner, who
is the President of the Managing Committee of the Housing Society, has filed the instant petition.
3. Learned Counsel for the petitioner submits that the Assistant Registrar can suspend the Managing Committee only after giving a show cause
notice and after receiving reply thereof, and hearing the petitioner. Therefore, in the instant case, he has acted without jurisdiction, while straight
way suspending the Managing Committee without waiting for reply to the show cause notice issued under Sub-section (1) of Section 34 of the
Act. In support of his contention, learned Counsel has relied upon decisions of this Court in Shri. S.R. Goyal and Others Vs. Shri Mehtab Singh,
Deputy Registrar, Cooperative Societies and Others, and Bharat Singh Vs. The Deputy Registrar, Cooperative Societies, .
4. After hearing counsel for the petitioner and going through the impugned order, we do not find any force in the contention of learned Counsel for
the petitioner. Section 34 of the Act provides for removal of Committee and this provision reads as under:
34. Removal of Committee.- (1) If in the opinion of the Registrar, a committee persistently makes default or is negligent in the performance of
duties imposed on it by this Act or the rules or the bye-laws or commits any act which is prejudicial to the interest of the society or its members,
the Registrar may after giving the committee an opportunity to state its objections, if any, by order in writing, remove the committee, and order
fresh election of the committee or appoint administrators in accordance with the provisions of Section 33.
Provided that the appointment of administrators shall be for a period of one year which may be extended, from time to time, up to three years.
(2) Where the Registrar, while proceeding to take action under Sub-section (1), is of the opinion that suspension of the committee during the
period of proceedings is necessary in the interest of the co-operative society, he may suspend the committee and make such arrangement as he
thinks proper for the management of the affairs of the society till proceedings are completed.
Provided that if the committee so suspended is not removed, it shall be re-instated and the period of suspension shall count towards its tenure.
Provided further that the period of suspension shall not exceed six months.
(3) The administrators appointed under Sub-section (1) shall arrange, for the election of a committee in accordance with the bye-laws of the
society failing which the Registrar shall arrange to hold the election.
(4) Before taking any action under Sub-section (1) in respect of a co-operative society, the Registrar shall consult the financing institution to which
it is indebted.
Section 35 of the Act provides for similar provisions for removal of Committee Members.
5. A reading of the aforesaid provisions shows that the Registrar is empowered to remove the Managing Committee who is guilty of persistent
default or is negligent in the performance of duties imposed on it by the Act or the Rules. Sub-section (2) further empowers the Registrar to
suspend the Committee, while proceeding to take action under Sub-section (1), during the period of those proceedings, if in his opinion it is
necessary to do so in the interest of the co-operative society and he may make such arrangement as he thinks proper for the management of the
affairs of the society till the proceedings are completed. The provision to this sub-section further provides that if the committee so suspended is not
removed, it shall be reinstated and the period of suspension shall count towards its tenure. The second provision further provides that the period of
suspension shall not exceed six months. From the reading of the aforesaid provisions, it cannot be inferred that it is imperative for the Registrar to
issue show cause notice and provide an opportunity of hearing, before passing order of suspension under Sub-section (2) of Section 34 of the Act.
A show cause notice and opportunity of hearing is required only before passing order of removal of the committee. Sub-section (2) clearly
empowers the Registrar to suspend the committee, while proceeding to take action under subsection (1), if he is of the opinion that, during the
period of proceedings, it is necessary in the interest of the co-operative society.
6. The aforesaid decisions of this Court, relied upon by learned Counsel for the petitioner, do not support the case of the petitioner. In S.R.
Goyal''s case (supra), it was held as under:
A plain reading of Sub-section (2) of Section 34 of the Act makes it clear that powers u/s 34(2) to suspend the Managing Committee of the
Society can be exercised by the Registrar only during the pendency of the proceedings under Sub-section (1) of Section 34. Registrar can suspend
the Committee during the period of proceedings only if he. forms an opinion that it is necessary so to do in the interest of the Co-operative Society.
Pendency of proceedings under Sub-section (1) of Section � 34, is a condition precedent for invoking the powers to suspend the committee, if
no proceedings are pending for removal of the committee u/s 34(1) then orders suspending the committee cannot be passed because the order of
suspension can be operative only during the period of proceedings. In the absence of pendency of any proceedings, the question of suspension of
the committee thus cannot arise. It is an admitted case before us that no proceedings u/s 34(1) of the Act for removal of the committee have either
been initiated or pending."" This judgment is not applicable to the facts and circumstances of this case, because in the instant case, undisputedly, the
proceedings for removal have been initiated under Sub-section (1) of Section 34 of the Act and when the order of suspension was passed in
exercise of power under Sub-section (2), the proceedings were pending.
7. Similarly, in Bharat Singh''s case (supra), this Court held as under:
4. A conjoint reading of the above quoted provisions of the Act shows that the Registrar is empowered to remove any member of the Committee
who is guilty of persistent default or is negligent in the performance of duties imposed on him by Act or the rules or bye-laws or is guilty of
committing any act prejudicial to the interest of the society or its members. However, what is imperative for the Registrar before he passes an
order u/s 35(1) of the Act is that he must give such member an opportunity to submit his objection to the proposed action and then to pass a
reasoned order for removing such member from the office. The language used in Section 35(1) clearly shows that the Legislature has thought it
proper to engraft the basic principles of natural justice in the statute itself. It can, thus, be said that before the Registrar passes an order, he is
required to give Show Cause Notice to the member concerned, consider his representation and then pass appropriate order. Issuance of Show
Cause Notice u/s 35(1) can appropriately be equated with initiation of enquiry. Logically it has to be held that till a Show Cause Notice is issued
with the proposal to take action against the erring member u/s 35(1), the proceedings cannot be treated as having been initiated.
5. Section 35(2) of the Act empowers the Registrar to suspend such member during the period of proceedings, if the Registrar considers it
necessary to do so in the interest of the co-operative society. The expression ""during the period of proceedings'' contemplates the pendency of
proceedings as a condition-precedent for taking action u/s 35(2) and if the proceedings have not been initiated u/s 35(1), the same can not be
treated as pending. In that situation, the Registrar is not empowered to place a member under suspension.
6. A look at the impugned order shows that the Registrar has suspended the petitioner even without issuing a notice u/s 35(1). Therefore, it has to
be held that the Registrar has exercised the power of suspending the petitioner in contravention of the provisions of Section 35(2) of the Act.
8. This judgment is also not applicable to the facts and circumstances of this case, because in that case, it was held the pendency of proceedings
for removal is a condition precedent for taking action u/s 35(2) of the Act and if proceedings have not been initiated u/s 35(1), the same cannot be
treated as pending.
9. In the instant case, since the proceedings for removal of the managing Committee were initiated u/s 34(1) of the Act, therefore, the Registrar
was within his power to suspend the Managing Committee in the interest of the society
10. In view of the above, there is no merit in the instant writ petition and the same is, hereby dismissed.