Co-op & RTI: Recognizing Ground Realities

By I C Naik

Apropos the post by Shri Ajay Jha titled “Confusion abounds: Now HC Bench says co-ops fall under RTI “ this post tries to discern the confusion on an eccentric pitch.

The Bombay High Court Aurangabad Bench (the Bombay HC)” rejected the relief sought by Jalgaon Jillha Urban Cooperative Banks Association Ltd vide Writ Petition No.1304 filed in 2008  under Article 226 and 227 of the Constitution of India.

The Petitioner’s grievance: “the authorities created under the Cooperative Societies Act are insisting the institutions to pass on information in respect of the conduct of business and other things of the societies to the members or even general public under the provisions of the Act.”

With a view to getting rid of the menace once for all, the Petitioner Association knocked the door of the Bombay HC  and urged the Hon. Court to hold and declare that the Cooperative   Institutions ( “the Cooperatives” )  registered under  the Maharashtra  Cooperative   Societies   Act   1960 (the MCS Act 1960) :

a.are not “public authorities” u/s  2(h)

and/or

b.the Cooperatives are exempt from disclosure of information u/s   8)1,   (d), (e)  and   (j)   of the Right to Information Act 2005 (” RTI 2005 “)

The Bombay HC pointed out a few attributes of cooperatives which were in vogue since time imemorial. These attributes played the devil’s advocate for the rejection of the relief prayed for. Few relevant attributes are listed below.

i.The cooperatives registered under the MCS Act 1960 are bodies created by the statute.

ii.Right from the registration there is control over of the authority under the MCS Act 1960 .

iii. The authority steps in to take decisions on the rights of the members.

iv.The authority has control over the manner in which the funds are invested or the distribution of the funds is made for different purpose.

v.The authority under the Act can do the audit and inquiry into irregularities.

vi.If loss is caused to the institution, there is the power of suspension of managing committee and removal of members with the authority created under the Act.

It appears these attributes are viewed as ground realities and possibly sub-consciously, marshaled in by the Bombay HC, even at the risk of the Supreme Court of India overturning, for there are valid reasons to believe so, which should unfurl little later. But it must be acknowledged with gratitude by every cooperators that the 13/2 order of the Bombay HC did bring these wicked features of cooperative regulations in sharp focus, could be at the right time.

The horrifying imperatives of this 13/2 order can be imagined by connecting it to the views of the Hon Apex Court in in Thalappalam Ser.Coop.Bank Ltd.& … vs State Of Kerala & Ors., dated  7 October, 2013 : CIVIL APPEAL NO. 9017 OF 2013 (the 7/10 order). Relevant Part of Para 52 is extracted below from the said order namely:

“52. Registrar of Cooperative Societies functioning under the Cooperative Societies Act is a public authority within the meaning of Section 2(h) of the Act. As a public authority, Registrar of Co-operative Societies has been conferred with lot of statutory powers under the respective Act under which he is functioning. He is also duty bound to comply with the obligations under the RTI Act and furnish information to a citizen under the RTI Act.”

The 13/2 order of the Bombay HC, seems to have paved the way for authorities under the MCS Act 1960 to call for any information of any cooperatives in which any citizen has shown interest personal / otherwise. Perhaps the horrendous ground realities faced by the cooperative management and the cooperators have claimed a much bigger slice of the cake by way of this 13/2 order, on a flip side. For that it should not go unchallenged.

Here, it is quite pertinent to remember the Apex Court observations in another  land mark judgment delivered by the Division Bench , on March 19, 2015 [(2015) 42 SCD 494] (19/3 order). “Co-operatives are autonomous, self-help organizations controlled by their members.” it was quoted by the Apex Court from Seven Principles of Cooperatives practiced globally.  Further the Bench lamented : “it appears that the cooperatives in India did not have effective autonomy, democratic functioning and professional management” and  lauded the 97th Amendment to the Constitution of India, which in fact, gave a constitutional frame to the National Policy on Cooperatives, the Government of India adopted in March, 2002 .

Para 7 of 2002 Cooperatives Policy declares a host of Policies the Central and State Governments have accepted to adhere to. Number (iv) of the 15 Policy statements is relevant here : “the regulatory role of the Government will be mainly limited to the conduct of timely elections, audit of the cooperative societies, and measures  to safeguard the interest of the members and other stake holders in the cooperatives”. Further it is sternly mandated that “ There shall, however, be no interference in the management and working of the cooperatives.”  The Government of India was tremendously concerned with “INTERFERENCE of Authorities and did not use the hateful word  “COTROL”. Perhaps the Government did not envision the  “Control of Cooperatives by the Authorities” which the Bombay HC frankly pointed out in the 13/2 order.

Reverting to the 13/2 order, the Bombay HC was apparently not impressed by this stern Policy diktat on INTERFERENCE in the midst of the rampant exploitation. Imperatives of 13/2 order is that the question of  INTERFERENCE could arise if in reality, the cooperatives were indeed set free from the clutches of the Bureaucracy and Politicians  so that they could function democratically with their member’s democratic control. The Bombay HC appears to have consciously evaded reference to these two land mark Apex Court orders on the un-documented premises, namely that the ground realities provided enough evidences that the cooperatives were still functioning the very old ways wherein the Politicians and Bureaucrats bountifully interfere to such an extent that there is no option to candidly accepting that Cooperatives are controlled by the Authorities created under the MCS Act 1960.

The Apex Court appears to have perceived as real, the text-book freedom to cooperatives  assured under the 2002  Cooperative Policy, Apex Court also profusely hailed such assurances, ignoring the ground realities which continue unabated.  This is what appears to be the visualization the learned Judges of the Division Bench of the Bombay HC behind not having a recourse to law laid down by  the Supreme Court of India.

Impression of the Bombay HC about the functioning of the cooperatives has to be related to the fact that they do exist even after the lapse of 15 years of declaration of  the 2002 Cooperative Policy of non-interference and after 5 years of the enactment of the so called historic Constitution (97th Amendment ) Act 2011); both these documents overtly targeting  to over-hauling the functioning of  cooperatives, fully aligning it to the global cooperative principles. This seems to have weighed heavily on the minds of the learned Judges of Division Bench while writing the 13/2 order, and sub-consciously shut the eyes off a sweeping ruling at Para 54 of the 7/10  order on Kerala Cooperatives (supra)..

If one goes through several of my posts on www.indiancooperative.com posted during the post 97CAA era and more particularly the single one at https://www.indiancooperative.com/cooperative-coffee-shop/exploding-the-myth-of-model-bye-laws/ I will be certainly branded an “atheist” (cynical) towards government’s bona-fide intentions. I am glad that there is a corroborative evidence provided by Cooperative Coffee Shop, dated November 27, 2016 posted by none other than Shri Ajay Jha himself. https://www.indiancooperative.com/featured/supporting-co-ops-modi-govt-as-callous-as-upa/  It is woefully titled “Supporting co-ops Modi govt as callous as UPA”

It is unlikely that the 13/ 2 order will go unchallenged. We can  hope that the ground realities of Cooperatives appears to have been perceived by the Bombay HC are intensely marshaled to defend 13/2 order before the  Constitutional Bench of the  Apex Court. At least it will   expose the unashamed apathy  of the  Politicians and Bureaucrats alike to cooperatives in all of the States and Union Territories. After all the Apex Court has accepted its responsibility at Para 28 of the 19/3 order (supra):

“Where the Constitution has conceived a particular structure on certain institutions, the legislative bodies are bound to mould the statutes accordingly. Despite the constitutional mandate, if the legislative body concerned does not carry out the required structural changes in the statutes, then, it is the duty of the court to provide the statute with the meaning as per the Constitution. … “The job of the Supreme Court is not to expound the meaning of the constitution but to provide it with meaning”

Going forward this one is entirely a different “reality ball game” in Indian Polity. Assuming proper law is very much in place, whether enacted by the State or “provided by the Apex Court” in performance of the Court’s duty as aforesaid,  how far the Judiciary can rein in the unworthy ground realities very subtly unearthed by the Bombay HC in 13/2 order?