IN THE HIGH COURT OF GUJARAT AT AHMEDABAD LETTERS PATENT APPEAL No. 913 of 2011 In SPECIAL CIVIL APPLICATION No. 2177 of 2011 With LETTERS PATENT APPEAL No. 914 of 2011 In SPECIAL CIVIL APPLICATION No. 223 of 2011 With CIVIL APPLICATION No. 12191 of 2011 In LETTERS PATENT APPEAL No. 914 of 2011 With CIVIL APPLICATION No. 12192 of 2011 In LETTERS PATENT APPEAL No. 913 of 2011 For Approval and Signature:
HONOURABLE MR.JUSTICE P.B.MAJMUDAR HONOURABLE MR.JUSTICE MOHINDER PAL ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair copy of the judgment ?
4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ?
5 Whether it is to be circulated to the civil judge ?
========================================================= BRIJARAJSINH HEMANTSINH JADEJA - Appellant(s) Versus STATE OF GUJARAT & 1 - Respondent(s) ========================================================= Appearance :
LPA 913/2011 MR ND NANAVATI,Sr.Counsel with MR BM MANGUKIYA for Appellant(s) : 1,MS BELA A PRAJAPATI for Appellant(s) : 1, MR TUSHAR MEHTA, Addl. Advocate General with Ms.Krina Calla, AGP for Respondent(s) : 1 - 2.
LPA 914/2011
MR ND NANAVATI,Sr.Counsel with MR BM MANGUKIYA for Appellant, MS BELA A PRAJAPATI for Appellant(s) : 1-3, 5-11 MR MB SHAIKH for Appellant No.4 MR TUSHAR MEHTA, Addl. Advocate General with Ms.Krina Calla, AGP for Respondent(s) : 1 – 3.
Respondent NO.4 -Notice unserved Notice served to Respondent No.5 and 8 MR DEVANG VYAS for Respondent No.6 and 7 ========================================================= CORAM : HONOURABLE MR.JUSTICE P.B.MAJMUDAR and HONOURABLE MR.JUSTICE MOHINDER PAL Date : 05/09/2012 CAV JUDGMENT (Per : HONOURABLE MR.JUSTICE P.B.MAJMUDAR)
1. Both these Letters Patent Appeals are directed against the judgment and order delivered by the learned Single Judge in Special Civil Application No.223 of 2011 with Special Civil Application No.2177 of 2011. By the common impugned judgment and order, the learned Single Judge dismissed both the petitions by upholding right of the State Government to send representatives and nomination of the Registrar of the Cooperative Societies, on the board of the Gujarat State Cooperative Agriculture & Rural Development Bank Limited (for short ‘the Bank’) under Section 80(1) of the Gujarat Cooperative Societies Act, 1961 (for short ‘the Act’).
2. So far as appellant of Letters Patent Appeal No.913 of 2011 is concerned, the said appellant had filed Special Civil Application No.2177 of 2011 before the learned Single Judge. The said appellant was one of the elected Directors, who lost election to the post of Chairman in the Bank, which election was held on 17th January, 2011. In his petition, the said appellant - original petitioner challenged the action of the State Government in nominating respondent No.2 on the ground that under Section 80(3) of the Act, the respondent No.2, i.e. Registrar, cannot act as a Member of the Board of Director of the Bank. So far as appellants of Letters Patent Appeal No.914 of 2011 are concerned, they were original petitioners of Special Civil Application No.223 of 2011. The same has been filed by the elected members of the Board of Directors of the Bank. Since the main issue involved in both these Letters Patent Appeals is common, i.e. powers of State Government to send its representatives to the Board of Directors to the Gujarat State Cooperative Agriculture and Rural Development Bank, the learned Single Judge heard both the matters together and by the common judgment and order, dismissed both the petitions. The learned Single Judge held that since the State Government stood as guarantor, it has a right to send its representatives in the management of the Bank under Section 80 (1) of the Act. The learned Single Judge also found that at the instance of the petitioner, petitions are not maintainable as the Bank itself has not challenged the decision and the petitioners are the Directors and therefore, cannot challenge such decision which is accepted by the Bank.
So far as petitioner of Special Civil Application No.2177 of 2011 is concerned, he had raised additional point before the learned Single Judge that the Registrar could not have acted as a Member of the Bank. The said point was also negatived by the learned Single Judge. The aforesaid decision of the learned Single Judge is challenged in the present appeals by the original writ petitioners.
3. Learned Senior Counsel Mr. N.D. Nanavati appearing with learned counsel, Mr.Mangukiya on behalf of the appellants - original petitioners argued that since the State Government has not subscribed to the share capital to the Bank i.e. Gujarat State Cooperative Agriculture and Rural Development Bank under the provisions of Section 80(3) of the Act, the State Government cannot send more than one nominee. In the instant case, since there are three nominees sent by the State Government, the said action is, therefore, violative of Section 80(3) of the Act. It is also argued by Mr.Nanavati that simply because the State Government stood as guarantor, it is not a ground for coming to the conclusion that inspite of clear language of Section 80(3) of the Act, the State Government is entitled to send its representative ignoring the mandate of Section 80(3) of the Act. It is submitted that when the State Government has not subscribed to the share capital, the Government is not entitled to send more than one representative as per Section 80(3) of the Act and Section 80(1) of the Act will have not application. The only argument, which is raised by the learned Senior Counsel for the appellants before us is that, the State Government has no power to send more than one representative to the management of the Bank and according to Mr.Nanavati, at the most it can only send one representative. It is also argued by Mr.Nanavati that the learned Single Judge has failed to consider the clear mandate of Section 80(3) of the Act and while interpreting the said Section, it is not necessary to refer to statement and object of the Act and to find out the object for incorporating Section 80(3) of the Act in the Statute book. It is submitted that when the language of the Section itself is clear, the Court is required to interpret the Section as it is. In case where there is some ambiguity, the Court can certainly consider the statement and object in order to find out legislative intent. However, according to Mr.Nanavati, in this case, when the language of the Section itself is very clear, the Court may interpret the Section as it is. It is submitted that the bank in question is a cooperative bank and as per the bye- laws, the bank is also entitled to give loan to other cooperative societies. It is submitted that the Central Bank in question can be said to be a Bank as defined under Section 2(3) of the Act. Mr.Nanavati also argued that it is no doubt true that the Bank, in the instant case, cannot be said to be a Primary Agricultural Credit Co-operative Society or a Central Co- operative Bank which are included in the co-operative credit structure, as it is dealing in long-term loan facility, yet on interpretation of Section 80(3) of the Act the State Government may not be entitled to send any representative as provided under Section 80(3) of the Act. Mr.Nanavati submitted that in any case, the learned Single Judge has erred in interpreting Section 80(3) of the Act by holding that even if the State has not subscribed to the share capital, yet since it stood as guarantor, Section 80(1) is still applicable, as Section 80(3) of the Act is not dealing with such a situation where the State has stood as guarantor.
4. Learned Additional Advocate General, Mr.Tushar Mehta appearing for the State Government has argued that considering the tripartite agreement between the Central Government, the State Government and NABARD, the State was required to make appropriate provisions regarding co- operative banks, which are dealing in short-term loan facilities. As per the said agreement, the State has also agreed to provide specific provisions in the Act regarding banks falling within the co-operative credit structure. Mr.Mehta submitted that in the instant case, the State has stood as guarantor and the amount of guarantee is more than crores of rupees. It is also submitted that there is a separate agreement of guarantee between the respondent No.6 - bank and the State Government and in that eventuality, even otherwise when by separate agreement which permitted the State to send 3 representatives, the State Government by virtue of the said agreement with the respondent No.6 bank, is entitled to have more than one representatives as per the agreement and such agreement is outside the purview of Section 80(3) of the Act. It is submitted that when there is a separate agreement arrived at between the parties, Section 80(3) of the Act will have no application, as the said Section nowhere provides that even if separate agreements are executed by which the State has stood as guarantor, such agreement will have no binding effect. It is submitted that in case of default, the State is required to make good the loss by making repayment. In such an eventuality, the State Government is required to monitor the affairs of the bank. It is submitted by Mr.Mehta that it is not in dispute that the bank in question is a land development bank and it did not fall within the co-operative credit structure. It is further submitted that there is a separate chapter so far as the land development bank is concerned i.e.
Chapter-XI in the Act. It is submitted that under the circumstances, even if the State has not subscribed to the share capital, yet it is entitled to send its 3 representatives as per Section 80(3) of the Act especially when there is a separate agreement of guarantee which permits the State to send such representatives. It is submitted that the bank in question cannot be said to be a state co-operative bank or central co-operative bank falling within the co-operative credit structure, as the bank, in the instant case, is admittedly dealing in long-term loan facility and even otherwise, it is not the sole object of the bank to disburse the loan to other societies. It is submitted that the bank in question is a land development bank which is dealing in long-term finance.
5. Mr.Mehta submitted that even otherwise, the present appellants have no locus standi to file the petition especially when the bank itself has not challenged the action of the State in sending 3 nominees and in fact, the bank has accepted such decision.
6. Learned counsel, Mr.Devang Vyas, appearing for respondent No.6 bank submitted that individual Members have no right to challenge the action of the bank and the appellants have no locus standi to file such appeals in particular individual capacity, as the decision of the bank is binding to all the Directors as it is unanimous decision and it cannot be challenged by any few individuals.
7. We have heard learned counsel appearing for the respective parties at length. We have also gone through the provisions contained in the Gujarat Cooperative Societies Act, Banking Companies Act, provisions under the NABARD Act, tripartite agreement arrived at between the Central Government, the State Government and NABARD, which has been placed on record of these Appeals by learned Additional Advocate General, Mr.Tushar Mehta. Mr.Mehta has also placed on record copy of Vaidhyanathan Committee, Memorandum of Understanding.
8. So far as the locus standi of the appellants is concerned, the appellants, who are the original petitioners, are Directors of the bank. Since the representatives of the Government are sent to the management of the bank, the members of the bank certainly have locus standi in a given case to oppose the same, as ultimately it will have effect regarding managing the affairs of the bank. Under the eventuality, the Directors of the bank are also entitled to challenge the action of the State in connection with sending representatives to the management of the bank. It, therefore, cannot be said that the appellants, who are the original petitioners in the writ petitions, have no locus standi to challenge the action of the State Government simply because the bank itself has not challenged the same. The preliminary objection taken by Mr.Mehta about locus standi of the original petitioners, therefore, rejected.
9. The only point, which is argued by Mr.Nanavati and which requires our consideration, is as to whether the State Government by virtue of provision of Section 80(3) of the Act is entitled to send more than one representative to the Board of Directors of the Bank or not and as to whether in case where State has given guarantee, the provisions of Section 80(3) can be said to be applicable in such eventuality or not. The question which also requires consideration is, as to whether the Bank in question is covered under Section 80(3) of the Act or not.
10. At this stage, a reference is required to be made to various provisions of the Gujarat Cooperative Societies Act. The definition of ‘Central Bank’ is provided in Section 2(3) of the Act which reads as under :
“2(3)—‘Central Bank’ - Means a co-operative bank, the objective of which include the creation of funds to be loaned to other societies.’
10.1 The definition of ‘Co-operative Bank’ is provided in Section 2(7) of the Act which reads as under :
“2(7)—‘Co-operative Bank’ – Means a society registered under this Act and doing the business of banking, as defined in Clause (b) of sub-section (1) of Section 5 of the Banking Companies Act,1949 (X of 1949).”
10.2 That Section 2(7A) of the Act was introduced w.e.f. 8.7.2010 which provides for co-operative credit structure, which reads as under :
“2(7A)‘co-operative credit structure’ means, (I) the primary agricultural credit co-operative societies (ii) the central co-operative banks; and (iii) the State co-operative bank.”
10.3 Section 80(1) of the Act provides power to appoint Government nominee, which reads as under :
“80(1) Where the State Government has subscribed to the share capital of a society, directly or through another society, or has guaranteed the repayment of the principal of and payment of Interest on, debentures issued or loans raised by a society, (the State Government shall, notwithstanding anything contained in the bye-laws of such society, have the right to nominate three representatives on the bye- laws of such society), in such manner as may be determined by the State Government from time to time. The members so nominated shall hold office during the pleasure of the State Government, or for such period as may be specified in the order by which they are appointed, and any such member on assuming office shall have all rights, duties, responsibilities and liabilities as if he were a member of the committee duly elected.”
10.4 Similarly, Section 80(3) of the Act was also introduced by the Legislature w.e.f. 8.10.2007 by Gujarat Act 1 of 2008, obviously on the basis of tripartite agreement entered into by the State, which provides power to appoint Government nominee, which reads as under :
“80(3) Notwithstanding anything contained in this Act or the Rules in the bye-laws, there shall be only one nominee of the State Government in the committee of the State Co-operative Bank or the Central Co-operative Banks where the State Government has subscribed to the share capital of such co-operative banks and no such nomination shall be made where the State Government has not subscribed to the share capital of such co-operative banks and no such nomination shall be made on the committee of a primary agricultural credit co- operative society irrespective of whether the State Government has subscribed to the share capital of a society or not.”
10.5 Section 5(b) of the Banking Regulation Act,1949 defines ‘banking’ which reads as under :
“5(b) ‘Banking’ – means the accepting, for the purpose of landing or investment, of deposits of money from the public, repayable on demand or otherwise, and withdrawal by cheque, draft, order or otherwise.”
11. Relying upon aforesaid Section 5(b) of the Banking Regulation Act,1949, learned Additional Advocate General, Me.Mehta submitted that the bank, in the instant case, is not accepting for the purpose of landing or investment of deposits of money from the public and therefore, it cannot be said to be doing baking business as per provision of Section 2(7) of the Act. It is submitted that it cannot be said that bank, therefore, doing any banking business and therefore, it cannot be said to be a co-operative bank in that sense.
12. It is required to be noted that so far as land development bank is concerned, there is a separate provision in Chapter-XI of the Act. As per Section 117 of the Act, the ‘Land Development Bank’ means, a co-operative bank registered or deemed to be registered under this Act. Section 116 of the Act provides that, this Chapter shall apply to Land Development Banks advancing loans, other than short-term loans, for the purposes of improvement and development of agricultural and productive purposes, erection, rebuilding or repairing of houses for agricultural purposes, the purchase or acquisition of title to agricultural lands by tenant purchasers or tenants under the Bombay Tenancy and Agricultural Lands Act, 1948, or any corresponding law, the liquidation of debt under the Bombay Agricultural Debtors Relief Act, 1947, promoting the development of animal husbandry, dairy farming, poultry farming, pisciclture or fishery; purchase of shares in a co-operative society engaged in the manufacture of sugar. In Explanation-1, it is provided that a short term loan means a loan for a duration of less than 18 months.
13. Relying upon aforesaid provisions, Mr.Mehta has argued that admittedly, the bank in question is dealing in long- term loans and therefore, it is covered under Chapter-XI of the Act.
14. A tripartite agreement was entered into between the Central Government (first party), the State of Gujarat (second party) and the NABARD (third party). As per the preamble of the same, it was felt necessary as a national priority to affirm the objective for revival and re-structuring of the rural cooperative credit structure (CCS), comprising the State Co-operative Banks (StCBs), Central Co-operative Banks (CCBs) and Primary Agricultural Credit Societies (PACS) on sustainable basis. The objective of the same is efficient delivery of financial services including savings and loan products at grassroots level in rural areas through rural cooperative credit structure with minimum regulatory burden and ensuring safety of public deposits accepted by the cooperative banking system. As per the preamble of the same, it is considered necessary for achievement of the objective that the institutions comprising cooperative credit structure are democratic, well governed, professionally managed and audited and have requisite autonomy in raising resources and deploying funds and undertaken financial activities as principal business and separately account for and fund other activities, if undertaken and that the State Cooperative Banks and Cooperative Credit Structure are effectively regulated at par with other credit cooperative societies in connection with other public safety deposits. Clause-9 of the said tripartite agreement provides as under :
“9. The State undertakes to bring in amendments to or incorporate a special chapter in the Gujarat State Co-operative Societies Act, 1961 to give effect to the reforms envisaged under the package in respect of all entities which are part of the CCS. Pending such amendments, the State undertakes to issue an Ordinance under the powers conferred on it under Article 213 of the Constitution of India to provide for the following in respect of all entities which are part of the CCS:
9.1. ensuring full voting membership rights to all depositors/borrowers in co-operatives other than co- operative banks,
9.2. providing autonomy to CCS in all financial and internal administrative matters, especially in the following areas:
- interest rates on deposits and loans in conformity with RBI guidelines,
- borrowings and investments,
- loan policies and individual loan decisions,
- personnel policy, staffing, recruitment, posting, and compensation to staff, and
- internal control systems, appointment of auditors and compensation for the audit.
9.3. restricting the State Government's equity to a maximum of 25% in any co-operative at any level and limiting State participation in the Board of a StCB or CCBs to only one nominee and not to have any State nominee on the Board of any Primary Agricultural Credit Society. The state or a co-operative at any level wishing to reduce the State equity further would be free to do so and the co-operative will not be prevented from doing so.
(emphasis supplied)”
14.1 It is not in dispute that Section 80(3) of the Act was subsequently added after the aforesaid tripartite agreement and since the State was required to give effect of the reforms envisaged under the package. It is required to be noted that the State Government's equity is restricted maximum upto 25%. As pointed out earlier, it is not disputed that the entire tripartite agreement and package was in connection with cooperative societies, who are clasified under the cooperative credit structures. As pointed out earlier, the respondent No.6 bank does not fall under cooperative credit structure as per Section 2(7A) of the Act which fact, as such, is not in dispute. It is also required to be noted that Section 2(7A) of the Act is also added in Section 2 of the Act in view of the tripartite agreement entered into by the State Government with the NABARD and the Government of India.
15. It is required to be noted that in the present case, it is not in dispute that respondent No.6 bank is a land development bank and it is only dealing in the long-term loan facilities. As per the bye-laws of the bank, the bank is permitted to give loan to other co-operative societies also, but it can never be said that the primary object of the bank is to give loan facilities to other co-operative societies. As per the provisions of the Banking Regulation Act,1949, in our view, it is clear that the respondent No.6 bank is not dealing in accepting for the purpose of landing or investment, of deposits of money from the public, repayable on demand and therefore, same may not fall under Section 2(7) of the Act. In view of the same, it cannot be said that the respondent No.6 Bank is a cooperative bank dealing in the business of banking as defined under the Banking Regulation Act,1949 which was previously known as 'Banking Companies Act,1949'.
16. At this stage, a reference is required to be made to the definition of Section 2(u) of the National Bank for A. & R. Development Act,1981, which provides that, ‘State co- operative bank’ means the principal co-operative society in a State, the primary object of which is the financing of other co- operative societies in the State.
17. Section 2(v) of the said Act provides definition of ‘State land development bank’ means the co-operative society which is the principal land development bank (by whatever name called) in a State and which has as its primary object the providing of long-term finance for agricultural development.
18. As pointed out earlier, it cannot be said that the primary object of the respondent No.6 bank is to finance the other co-operative societies. Though as per bye-laws, they are permitted to do so, but it cannot be said to be a primary object nor there is nothing on record to show that they have ever even financed any other co-operative societies in the State. The bank in question can be said to be a land development bank as it’s object is to provide long-term finance for agricultural development.
19. Since the bank in question is a land development bank for which a separate Chapter is provided under Chapter- XI of the Act, it can never be said that its primary object is to disburse the loan. Even as per the tripartite agreement which is based on the report of Vaidhyanathan Committee, Section 80(3) was required to be incorporated for taking care of the societies falling under co-operative credit structure which is dealing with only short-term credit facilities and not long-term credit facilities. It is conceded by the appellants that the bank in question no longer falls under the co-operative credit structure, as it is not the primary agricultural credit co- operative society or the central co-operative bank as defined in Section 2(7A) of the Act. If any co-operative society, which is concerned with primary agricultural credit co-operative society or the central co-operative bank and the State co- operative bank, falls under the co-operative credit structure as per Section 2(7A) of the Act, such 3 societies i.e. primary agricultural credit co-operative society or the central co- operative bank and the State co-operative bank falling under co-operative credit structure. If a central co-operative bank is falling within the co-operative credit structure, in that case central co-operative bank is covered under Section 80(3) of the Act along with primary agricultural credit co-operative society and the State co-operative bank. As pointed out earlier, the bank in question is dealing only in long-term loan facilities and this being a land development bank, it can never be said that its primary object is to disburse the loan. In view of the tripartite agreement, it is clear that share capital of the State Government is restricted to only particular percentage and not beyond that. In view of the same, the case of the respondent No.6 bank cannot be said to be falling under Section 80(3) of the Act. It is also required to be noted that even otherwise, there is already a separate agreement entered into between the State Government and the respondent No.6 bank at the time when the State Government had stood as guarantor. In the said agreement of guarantee, the respondent No.6 bank has agreed that the State can send 3 representatives to the Board of Management of the Bank. When there is a separate agreement of guarantee between the parties, the State is empowered to send more than one representatives as per the separate agreement executed between the parties. The provision of Section 80(3) of the Act, therefore, will have no application if a separate written agreement is executed by the State with a bank. In view of the same, the argument of the appellants that State has no power, in the present case, to send more than one representatives cannot be accepted. Said agreement is outside the scope of Section 80(3) of the Act, as it is an independent contract.
20. Learned Additional Advocate General, Mr.Mehta has relied upon certain decisions of the Supreme Court in support of his case.
(i) In case of Bengal Immunity Co. Ltd. v. State of Bihar & Ors., reported in AIR 1955 SC 661, wherein the Supreme Court has observed in Para.22 as under :
“22. It is a sound rule of construction of a statute firmly established in England as far back as 1584 when Heydon's case 3 Co. Rep. 7a; 76 E.R. 637 was decided that -
"......... for the sure and true interpretation of all Statutes in general (be they penal or beneficial, restrictive or enlarging of the common law) four things are to be discerned and considered :-
1st. What was the common law before the making of the Act., 2nd. What was the mischief and defect for which the common law did not provide., 3rd. What remedy the Parliament hath resolved and appointed to cure the disease of the Common wealth., and 4th. The true reason of the remedy; and then the office of all the judges is always to make such construction as shall suppress the mischief, and advance the remedy, and to suppress subtle inventions and evasions for continuance of the mischief, and pro privato commodo, and to add force and life to the cure and remedy, according to the true intent of the makers of the Act, pro bono publico".
(ii) In the case of The Vanguard Fire & General Insurance Co. Ltd., Madras v. M/s.Fraser and Ross & Anr., reported in AIR 1960 SC 971, wherein the Supreme Court has observed in Para.6 as under :
“6. The main basis of this contention is the definition of the word "insurer" in s. 2(9) of the Act. It is pointed out that definition begins with the words " insurer means" and is therefore exhaustive. It may be accepted that generally the word " insurer" has been defined for the purposes of the Act to mean a person or body corporate, etc., which is actually carrying on the business of insurance, i.e., the business of effecting contracts of insurance of whatever kind they might be. But s. 2 begins with the words " in this Act, unless there is anything repugnant in the subject or context " and then come the various definition clauses of which (9) is one. It is well settled that all statutory definitions or abbreviations must be read subject to the qualification variously expressed in the definition clauses which created them and it may be that even where the definition is exhaustive inasmuch as the word defined is said to mean a certain thing, it is possible for the word to have a somewhat different meaning in different sections of the Act depending upon the subject or the context. That is why all definitions in statutes generally begin with the qualifying words similar to the words used in the present case, namely, unless there is anything repugnant in the subject or context. Therefore in finding out the meaning of the word " insurer " in various sections of the Act, the meaning to be ordinarily given to it is that given in the definition clause. But this is not inflexible and there may be sections in the Act where the meaning may have to be departed from on account of the subject or context in which the word has been used and that will be giving effect to the opening sentence in the definition section, namely, unless there is anything repugnant in the subject or context. In view of this qualification, the court has not only to look at the words but also to look at the context, the collocation and the object of such words relating to such matter and interpret the meaning intended to be conveyed by the use of the words under the circumstances. Therefore, though ordinarily the word " insurer " as used in the Act would mean a person or body corporate actually carrying on the business of insurance it may be that in certain sections the word may have a somewhat different meaning.
(iii) In the case of Santa Singh v. The State of Punjab, reported in AIR 1976 SC 2386, wherein the Supreme Court has observed in Para.4 as under :
“4. ...It is a well settled rule of interpretation, hallowed by time and sanctified by authority, that the meaning of an ordinary word is to be found not so much in a strict etymological propriety of language, nor even in popular use, as in the subject or occasion on which it is used and the object which is intended to be attained. ...”
(iv) In the case of Mukesh K. Tripathi v. Sr. Divisional Manager, LIC & Ors., reported in AIR 2004 SC 4179, wherein the Supreme Court has observed in Para.38 and 42 as under :
“38. The interpretation clause contained in a statute although may deserve a broader meaning having employed the word 'includes' but therefor also it is necessary to keep in view the scheme of the object and purport of the statute which takes him out of the said definition. Furthermore, the interpretation section begins with the words 'unless the context otherwise requires."
42. Yet again in Workmen of Dimakuchi Tea Estate v. Management of Dimakuchi Tea Estate (AIR 1958 SC 353), this Court held :
"A little careful consideration will show, however, that the expression 'any person' occurring in the third part of the definition clause cannot mean anybody and everybody in this wide world. First of all, the subject matter of dispute must relate to (i) employment or non-employment or (ii) terms of employment or conditions of labour of any person; these necessarily import a limitation in the sense that a person in respect of whom the employer- employee relation never existed or can never possibly exist cannot be the subject matter of a dispute between employers and workman. Secondly, the definition clause must be read in the context of the subject matter and scheme of the Act, and consistently with the objects and other provisions of the Act. It is well settled that-
'the words of a statute, when there is a doubt about their meaning are to be understood in the sense in which they best harmonise with the subject of the enactment and the object which the legislature has in view. Their meaning is found not so much in a strictly grammatical or etymological propriety of language, nor even in its popular use, as in the subject or in the occasion on which they are used, and the object to be attained."
(Maxwell, Interpretation of Statutes, 9th Edition, p.55).”
(v) In the case of The State of Maharashtra v. Indian Medical Association & Ors., reported in AIR 2002 SC 302, wherein the Supreme Court has observed in Para.8 as under :
“8. A bare perusal of Section 2 of the Act shows that it starts with the words "in this Act, unless the context otherwise requires....". Let us find out whether in the context of the provisions of Section 64 of the Act the defined meaning of the expression "management" can be assigned to the word 'management in Section 64 of the Act. In para 3 of the Regulations, the Essentiality Certificate is required to be given by the State Government and permission to establish a new medical college is to be given by the State Government under Section 64 of the Act. If we give the defined meaning to the expression "management" occurring in Section 64 of the Act, it would mean the State Government is required to apply to itself for grant of permission to set up a Government medical college through the University. Similarly it would also mean the State Government applying to itself for grant of Essentiality Certificate under para 3 of the Regulation. We are afraid the defined meaning of the expression "management" cannot be assigned to the expression "management" occurring in Section 64 of the Act. In the present case, the context does not permit or requires to apply the defined meaning to the word 'management' occurring in Section 64 of the Act. However, after the Government run medical college is established, necessarily there has to be management or body of persons to run the affairs of the medical college and for such a situation the expression 'management' as defined in Section 2(21), is contemplated under Section 65 of the Act. In the context of the provisions of Section 65 of the Act, the management of the Government run medical college has to apply for grant of affiliation to the University which may be the State Government. It is not disputed that the State Government (Management) did apply for grant of affiliation to the University which was granted. We are, therefore, of the opinion that the defined meaning of the expression 'management' cannot be assigned or attributed to the word 'management' occurring in Section 64 of the Act. The word 'management' if read in the context of the provisions of Section 64 of the Act, means any one else excepting the State Government applying to a State Government for permission to establish the proposed medical college at proposed location to be decided by the State Government.”
21. At this stage, a reference is required to be made to a letter dated 9.3.2011 written by NABARD to the respondent No.6 bank, which is forming part of this proceedings. The said letter is in connection with query of the bank with the NABARD regarding revival of Long-term Co-operative Credit Structure. In the said letter, it is stated by NABARD that based on the recommendations of Task Force, an auction plan for the revival of the Short-term Credit Structure (STCCS), was submitted to the Central Government in February,2005 and the Task Force also submitted its report for revival of Long- term Co-operative Credit Structure (LTCCS) in August,2006. Subsequently, the Government of India constituted a Task Force under the Chairmanship of Mr.G.C.Chaturvedi, IAS, Addl. Secretary (FS), Ministry of Finance, Government of India to review the need for separate package for revival of LTCCS. The Task Force has also submitted its final recommendations to Government of India for revival of the LTCCS and the same is under examination of the Government of India.
22. Relying upon said letter, it is argued by Mr.Mehta that so far as long-term co-operative credit structure is concerned, same is under consideration of the Government of India and if any provisions is made, the State Act also will be required to be amended accordingly on the basis of the subsequent eventuality.
23. It is also argued by Mr.Mehta that even as per Section 74(2) of the Act, there shall be two professionals on the committee of the Central Co-operative bank and the State co-operative bank having qualification prescribed by the Reserve Bank of India or, as the case may be, the National Bank. It is submitted that in the respondent No.6 bank, there are no such representatives as it is not a Central co-operative bank at all.
24. After considering the aforesaid background, in our view, so far as co-operative bank dealing in long-term loan facility is concerned, as on today, no decision is taken in this behalf and only decision is taken regarding co-operative bank dealing in short-term credit facilities for which tripartite agreement is arrived at, on the basis of which special procedure has been made regarding co-operative credit structure in connection with co-operative society or co- operative bank dealing in short-term loan facilities and those who are dealing in long-term loan facilities, formula is yet to be arrived at. It is an admitted fact that respondent No.6 bank is not covered under the co-operative credit structure as on today.
25. Considering the aforesaid aspect and considering the provisions of the Act and the provisions of the NABARD as well as the reasons as to why subsequently the co-operative credit structure is included in the Gujarat Co-operative Society Act, it is clear that respondent No.6 bank cannot be said to be forming part of the co-operative credit structure, as it is a land development bank dealing in long-term finance facilities. Even otherwise, since at the time of giving guarantee, an agreement has already been executed by the State Government with the respondent No.6, by which the State was permitted to send 3 representatives. In our view, the learned Single Judge has rightly held that in the facts and circumstances of the case, the case of the present appellants cannot be said to be falling under Section 80(3) of the Act and the State is entitled to send more than one representatives as Section 80(3) of the Act cannot be said to be applicable as on today, so far as the appellants are concerned and even otherwise, by virtue of separate agreement at the time of giving guarantee which is more than crores of rupees, the State can act as per the agreement arrived at independently between it and the respondent No.6 Bank.
26. Considering what is stated hereinabove, we are convinced that appellants have not made out any case in the eye of law and therefore, both the Letters Patent Appeals are required to be dismissed and accordingly, same are dismissed. Notice is discharged.
27. In view of dismissal of main Letters Patent Appeals, civil applications do not survive and stand disposed of accordingly.
(P. B. MAJMUDAR, J.)
(vipul)
(MOHINDER PAL, J.)