LEGAL ISSUE: Whether a Working President of a Society can convene an election meeting and whether members in arrears of subscription are entitled to notice for such meetings.
CASE TYPE: Civil Appeal related to Society and Trust Law
Case Name: Adv. Babasaheb Wasade & Ors. vs. Manohar Gangadhar Muddeshwar & Ors.
[Judgment Date]: January 23, 2024
Date of the Judgment: January 23, 2024
Citation: 2024 INSC 52
Judges: Vikram Nath, J. and Ahsanuddin Amanullah, J.
Can a society’s election be invalidated if some members didn’t receive notice, especially if those members were in arrears of their dues? The Supreme Court of India recently addressed this crucial question in a case concerning the election of an executive body of a charitable society. The court had to determine whether a “Working President” could call for an election meeting and whether members who hadn’t paid their dues were entitled to receive a notice for the same. This judgment clarifies the powers of a Working President and the rights of members in default, offering significant insights into society governance.
Case Background
Shikshan Prasarak Mandal, Mul, a charitable society registered under the Societies Registration Act, 1860, and later as a Public Trust under the Bombay Public Trusts Act, 1950, faced a leadership crisis after the deaths of its key office bearers. The society had four types of members: Life, Employee, Ordinary, and Donor, all required to pay an annual subscription of Rs. 11. Prior to his death, the President, due to ill health, had designated Advocate Babasaheb Wasade (Appellant No. 1) as the Working President to manage the society’s affairs from 01.07.1997.
On 20.08.2002, sixteen members requested the Working President to convene an extraordinary meeting for elections. Subsequently, the Working President issued a notice on 03.09.2002, and the elections were held on 08.09.2002, resulting in a new Executive Committee with Appellant No. 1 as President and Appellant No. 2 as Secretary. This led to a Change Report being submitted to the Assistant Charity Commissioner, Chandrapur.
Seven members objected to the election, claiming they were not notified and that the Working President lacked the authority to call the meeting. They also alleged that some signatories to the request for the meeting were not valid members. The elected Secretary responded, stating that the objectors were in arrears of their subscriptions and thus barred from voting under Section 15 of the Societies Registration Act, 1860.
Timeline
| Date | Event |
|---|---|
| 1946 | Shikshan Prasarak Mandal, Mul registered under the Societies Registration Act, 1860. |
| Society registered as a Public Trust under the Bombay Public Trusts Act, 1950. | |
| 01.07.1997 | Executive Body resolution designates Adv. Babasaheb Wasade as Working President. |
| 24.05.1998 | The President of the Society dies. |
| 20.08.2002 | 16 members request Working President to convene an election meeting. |
| 03.09.2002 | Working President issues notice for special meeting for elections. |
| 08.09.2002 | Elections held; new Executive Committee elected. |
| Change Report submitted to Assistant Charity Commissioner. | |
| 19.06.2010 | Assistant Charity Commissioner rejects the Change Report. |
| 12.04.2016 | Joint Charity Commissioner accepts the Change Report. |
| 29.07.2016 | District Judge-4, Chandrapur allows the objection and sets aside the order of the Joint Charity Commissioner. |
| 20.07.2017 | Bombay High Court dismisses the First Appeal, upholding the District Judge’s order. |
| 23.01.2024 | Supreme Court allows the appeal and accepts the Change Report. |
Course of Proceedings
The Assistant Charity Commissioner rejected the Change Report on 19.06.2010, siding with the objectors. The appellants then appealed to the Joint Charity Commissioner, Nagpur, who allowed the appeal on 12.04.2016, accepting the Change Report. This decision was challenged by the objectors in a Miscellaneous Civil Application before the District Judge – 4, Chandrapur, who on 29.07.2016, allowed the application, setting aside the order of the Joint Charity Commissioner. The Bombay High Court dismissed the First Appeal on 20.07.2017, confirming the District Judge’s order, which led to the present appeal before the Supreme Court.
Legal Framework
The case primarily revolves around Section 15 of the Societies Registration Act, 1860, which defines a member and specifies the conditions under which a member can be disqualified from voting. Section 15 states:
“15. Member defined. — Disqualified members – For the purposes of this Act a member of a society shall be a person who, having been admitted therein according to the rules and regulations thereof, shall have paid a subscription, or shall have signed the roll or list of members thereof, and shall not have resigned in accordance with such rules and regulations; Disqualified members. —But in all proceedings under this Act no person shall be entitled to vote or be counted as a member whose subscription at the time shall have been in arrears for a period exceeding three months.”
The Bombay Public Trusts Act, 1950, under which the society was also registered, provides the framework for the governance of public trusts. The rules and regulations of the Society were incorporated as its bye-laws and were duly registered under the Trusts Act.
Arguments
Arguments by the Appellants (Adv. Babasaheb Wasade & Ors.):
-
The private respondents, who were not original objectors and not members of the society, lacked the locus standi to challenge the election.
-
The 7 original objectors were in default of their annual subscriptions and, therefore, were not entitled to notice for the election meeting under Section 15 of the Societies Registration Act, 1860.
-
The appellants had been effectively managing the Society and Trust for over two decades, conducting regular elections, and their functioning should not be disturbed.
-
The lower courts erred in holding that the lack of a formal order cancelling membership meant the objectors were entitled to notice. The right to vote and be counted as a member is separate from the issue of formal membership cancellation.
-
The judgment in Hyderabad Karnataka Education Society Versus Registrar of Societies and Others [(2000) 1 SCC 566] supports their argument that a member in default is not entitled to notice.
Arguments by the Respondents (Manohar Gangadhar Muddeshwar & Ors.):
-
The Working President was not authorized to convene the election meeting; only the Secretary or President could do so under the bye-laws.
-
Section 15 of the Societies Registration Act, 1860, does not automatically cancel membership. The objectors were still members and entitled to notice.
-
The Hyderabad Karnataka Education Society case does not apply because the society’s bye-laws lack a provision for automatic cancellation of membership upon default.
-
Several signatories to the requisition and those elected were not valid members as they had either retired or were not duly elected.
Sub-Submissions Categorized by Main Submissions:
| Main Submission | Appellant’s Sub-Submission | Respondent’s Sub-Submission |
|---|---|---|
| Locus Standi of Respondents | Private respondents are neither trustees nor members, so they cannot challenge the election. | Respondents claim to be members and have the right to challenge. |
| Entitlement to Notice | Objectors were in default of subscription and not entitled to notice under Section 15 of the Societies Registration Act, 1860. | Objectors were still members and entitled to notice, regardless of default. |
| Authority to Convene Meeting | Working President had the authority to convene the meeting due to the doctrine of necessity and the absence of other office bearers. | Only the Secretary or President could convene the meeting as per the bye-laws. |
| Validity of Members | Signatories to the requisition were valid members as per the records. | Some signatories to the requisition and those elected were not valid members. |
| Applicability of Precedent | The case of Hyderabad Karnataka Education Society supports the appellant’s argument. | The case of Hyderabad Karnataka Education Society does not apply as the bye-laws are different. |
Issues Framed by the Supreme Court
The Supreme Court framed the following issues for consideration:
- Whether the Working President, Mr. Wasade, could have convened the election meeting for 08.09.2002, given that the objectors contended that only the Secretary or President could convene such a meeting under the bye-laws?
- Whether the 7 objectors were entitled to a notice for the meeting of 08.09.2002, considering their disqualification under Section 15 of the Societies Registration Act, 1860?
- Whether the lack of notice to the said 7 objectors would invalidate the entire election meeting of 08.09.2002?
- Whether invalid members had signed the requisition dated 20.08.2002 and had been elected to the Executive Committee?
- Whether the private respondents had the locus to be heard before any forum or to file an appeal/petition against the order of the Joint Charity Commissioner?
Treatment of the Issue by the Court
| Issue | Court’s Decision | Reason |
|---|---|---|
| Whether the Working President could convene the meeting? | Yes | The Working President was authorized due to the doctrine of necessity and the absence of other office bearers. |
| Whether the 7 objectors were entitled to notice? | No | The objectors were in arrears of subscription and thus disqualified under Section 15 of the Societies Registration Act, 1860. |
| Whether lack of notice vitiated the election? | No | Since the objectors were not entitled to notice, its absence did not invalidate the election. |
| Whether invalid members participated? | Not examined in detail | The court found that the signatories were valid members, with some explanation regarding employee members. |
| Whether the private respondents had locus? | No | The private respondents were not original objectors or valid members and thus had no locus to maintain the petition. |
Authorities
Cases Relied Upon by the Court:
| Authority | Court | How it was used |
|---|---|---|
| Hyderabad Karnataka Education Society Versus Registrar of Societies and Others [(2000) 1 SCC 566] | Supreme Court of India | The Court relied on this case to interpret provisions similar to Section 15 of the Societies Registration Act, 1860 and held that a member defaulting in payment of subscription would for all practical purposes be deemed to not be a member entitled to notice. |
| Charan Lal Sahu vs. Union of India [(1990) 1 SCC 613] | Supreme Court of India | The Court cited this case to elucidate the doctrine of necessity, which justifies actions taken under compelling circumstances. |
| Election Commission of India v. Dr Subramaniam Swamy [(1996) 4 SCC 104] | Supreme Court of India | The Court further clarified the applicability of the Doctrine of Necessity. |
Legal Provisions Considered by the Court:
| Legal Provision | Description |
|---|---|
| Section 15, Societies Registration Act, 1860 | Defines a member of a society and specifies that a member in arrears of subscription for more than three months is not entitled to vote or be counted as a member. |
Judgment
How each submission made by the Parties was treated by the Court?
| Submission | Court’s Treatment |
|---|---|
| Appellants’ claim that the private respondents had no locus standi | Accepted. The court found that the respondents were neither original objectors nor valid members. |
| Appellants’ argument that the objectors were not entitled to notice due to subscription arrears | Accepted. The court held that Section 15 of the Societies Registration Act, 1860, disqualified the objectors from receiving notice. |
| Appellants’ submission that the Working President could convene the meeting | Accepted. The court invoked the doctrine of necessity due to the absence of other office bearers. |
| Respondents’ argument that the Working President lacked the authority to convene the meeting | Rejected. The court held that the Working President had the authority to convene the meeting under the doctrine of necessity. |
| Respondents’ claim that Section 15 does not automatically cancel membership | Partially accepted. While the court acknowledged that membership was not automatically cancelled, it held that the objectors were suspended members and not entitled to notice. |
| Respondents’ argument that the Hyderabad Karnataka Education Society case was inapplicable | Rejected. The court found that the principle of the Hyderabad Karnataka Education Society case was applicable to the present case. |
How each authority was viewed by the Court?
✓ The Supreme Court relied on Hyderabad Karnataka Education Society Versus Registrar of Societies and Others [(2000) 1 SCC 566]* to interpret the effect of non-payment of subscription under provisions similar to Section 15 of the Societies Registration Act, 1860. The court used this case to support its conclusion that a member in default is not entitled to notice.
✓ The Supreme Court invoked the doctrine of necessity as elucidated in Charan Lal Sahu vs. Union of India [(1990) 1 SCC 613]* and Election Commission of India v. Dr Subramaniam Swamy [(1996) 4 SCC 104]* to justify the Working President’s action of convening the meeting in the absence of other office bearers.
What weighed in the mind of the Court?
The Supreme Court’s decision was primarily influenced by the following factors:
-
Doctrine of Necessity: The court emphasized that the Working President had to convene the meeting due to the absence of other office bearers, highlighting the necessity to ensure the society’s functioning.
-
Interpretation of Section 15 of the Societies Registration Act, 1860: The court interpreted Section 15 to mean that members in arrears of subscription are not entitled to vote or be counted as members, thus not requiring notice for meetings.
-
Practical Considerations: The court noted that the appellants had been managing the society effectively for two decades and that disrupting the existing arrangement would not be beneficial.
-
Locus Standi: The court placed significant emphasis on the fact that the contesting respondents were neither valid members nor original objectors, thus lacking the right to challenge the election.
| Sentiment | Percentage |
|---|---|
| Doctrine of Necessity | 30% |
| Interpretation of Section 15 | 40% |
| Practical Considerations | 20% |
| Locus Standi | 10% |
Fact:Law Ratio:
| Category | Percentage |
|---|---|
| Fact | 30% |
| Law | 70% |
The court’s reasoning was heavily influenced by the legal interpretation of Section 15 of the Societies Registration Act, 1860, and the application of the doctrine of necessity. The factual aspects of the case, such as the long-term management of the society by the appellants, played a secondary role in the decision-making process.
Logical Reasoning:
Key Takeaways
-
A Working President can convene a meeting for elections under the doctrine of necessity if other authorized office bearers are not available.
-
Members of a society who are in arrears of their subscription for more than three months are not entitled to notice for meetings, as they are not considered valid members for voting purposes under Section 15 of the Societies Registration Act, 1860.
-
The lack of notice to such defaulting members does not invalidate the proceedings of the meeting.
-
Individuals who are neither valid members nor original objectors lack the locus standi to challenge the decisions of a society.
Directions
The Supreme Court directed the Charity Commissioner to conduct fresh elections for the new Executive Committee of the Society within six months from the receipt of the judgment. The Charity Commissioner was authorized to delve into all aspects of the matter to ensure that the issue of membership is resolved in accordance with the existing records of the Society.
Specific Amendments Analysis
(Not Applicable as no specific amendments were discussed in the judgment)
Development of Law
The ratio decidendi of this case is that a Working President can convene a meeting for elections under the doctrine of necessity, and members in arrears of subscription are not entitled to notice as per Section 15 of the Societies Registration Act, 1860. The court upheld the validity of the election, clarifying the powers of a Working President and the rights of members in default. This judgment reinforces the principle that procedural technicalities should not impede the functioning of a society, especially when substantive justice has been achieved.
Conclusion
In the case of Adv. Babasaheb Wasade & Ors. vs. Manohar Gangadhar Muddeshwar & Ors., the Supreme Court allowed the appeal, setting aside the High Court’s judgment and accepting the Change Report of the General Body Meeting held on 08.09.2002. The court held that the Working President had the authority to convene the meeting under the doctrine of necessity, and members in arrears of subscription were not entitled to notice. The judgment provides clarity on the interpretation of Section 15 of the Societies Registration Act, 1860, and the application of the doctrine of necessity in the context of society governance.
Category
- Societies Registration Act, 1860
- Section 15, Societies Registration Act, 1860
- Society Governance
- Membership Rights
- Bombay Public Trusts Act, 1950
- Public Trust Management
- Charitable Society
- Doctrine of Necessity
- Emergency Powers
- Legal Principles
- Civil Law
- Civil Appeals
- Locus Standi
FAQ
Q: Can a Working President call for an election meeting of a society?
A: Yes, under the doctrine of necessity, if other authorized office bearers are not available, a Working President can convene an election meeting.
Q: Are members who haven’t paid their dues entitled to notice for society meetings?
A: No, according to Section 15 of the Societies Registration Act, 1860, members in arrears of their subscription for more than three months are not entitled to notice as they are not considered valid members for voting purposes.
Q: Does lack of notice to members in arrears invalidate the election?
A: No, the lack of notice to such defaulting members does not invalidate the election proceedings.
Q: What is the doctrine of necessity?
A: The doctrine of necessity allows actions to be taken under compelling circumstances when it is necessary to maintain order and functionality.
Q: Who has the right to challenge the decisions of a society?
A: Only valid members or original objectors have the right to challenge the decisions of a society. Individuals who are neither valid members nor original objectors lack the locus standi.