In a recent matter the Queriest has raised following queries:-
Whether request for a Special General Meeting is prerogative of Society Members only?
Can Chairman OR management committee call for a Special General Meeting at any time or several times in a year for getting approval of a Agenda prepared by them ((not against a requisition from members) ?
Can Chairman or Management Committee call for a Special General Meeting against a requisition received from society members, signed by only 5 members?
Is it that Chairman or management committee can call Special General Meeting ONLY AND ONLY when they receive a Requisition signed by 20% members of society, OR a request letter from Registering Authority OR a request letter from Housing federation and such SPGM to be called by Chairman or managing committee at any time within one month from the date of such Requisition or letter?
Can Chairman OR Managing Committee declare the “Decisions made in a Special General Meeting ” as invalid?
Under what circumstances a Conducted Special General Meeting can be declared as invalid by Chairman OR Managing Committee?
To understand questions we need to know relevant provisions of law.
The Maharashtra Co-operative Society Act,1960 is the parent law which regulates the Co-operative Society.
SPECIAL GENERAL MEETING.
(1) A special general meeting may be called at any time by the Chairman special or by a majority of the committee and shall be called within one month—
(i) on a requisition in writing of one-fifth of the members of the society of members the number of which is specified in the by-laws for the purpose, whichever is lower, or
(ii) at the instance of the Registrar, or
(iii) in the case of a society, which is a member of a federal society, at the instance of the committee of such federal society.
(2) Where any officer or a member of the committee, whose duty it was to call such meeting, without reasonable excuse, fails to call such meeting, the Registrar may by order declare such officer or member disqualified, for being a member of the committee for such period not exceeding three years, as he may specify in such order; and if the officer is a servant of the society, he may impose on him a penalty not exceeding one hundred rupees. Before making an order under this sub-section, the Registrar shall give, or cause to be given, a reasonable opportunity to the person concerned of showing cause against the action proposed to be taken in regard to him.
(3) If a special general meeting of a society is not called in accordance with the requisition referred to in sub-section (1), the Registrar or any person authorised by him in this behalf, shall have power to call such meeting, and that meeting shall be deemed to be a meeting duly called by the committee.
(4) The Registrar shall have power to order that the expenditure incurred in calling a meeting under subsection (3) shall be paid out of the funds of the society or by such person or persons who, in the opinion of the Registrar, were responsible for the refusal or failure to convene the meeting.
ACTS OF SOCIETIES ETC. NOT TO BE INVALIDATED BY CERTAIN DEFECTS.
(1) No act of a society or a committee or any officer, done in good faith in pursuance of the business of the society shall be deemed to be invalid by reason only of some defect subsequently discovered in the organisation of the society, or in the constitution of the committee, or in the appointment or election of an officer or on the ground that such officer was disqualified for his office.
(2) No act done in good faith by any person appointed under this Act, the rules and the by-laws shall be invalid merely by reason of the fact that his appointment has been cancelled by or in consequence of any order subsequently passed under this Act, Rules and the by-laws.
(3) The Registrar shall decide whether any act was done in good faith in pursuance of the business of the society; and his decision thereon shall be final.
POWER OF REMOVAL OF COMMITTEE OR MEMBER THEREOF.
(2) The committee or administrator so appointed shall, subject to the control of the Registrar and to such instructions as he may from time to time give, have power to exercise all or any of the functions of the committee or of any officer of the society, and take all such-action as may be required in the interests of the society.
[The committee or administrator appointed as aforesaid shall, notwithstanding anything contained in the bye-laws, have power to call a special general meeting of the society to review or to reconsider the decision or the resolution taken or passed at the general meetings called by the previous committee or to endorse action taken by it.]
Maharashtra Co-operative Societies Rule, 1961
Rule 63. Power to call annual and special general meeting:- If the annual general meeting of a society is not called in accordance with the provisions of Section 75 or if the Chairman or a majority of the committee of the society fail to call a special general meeting in accordance with the provisions of Section 76, the Registrar may authorise any person subordinate to him or any officer or employee of a federal society to call the annual general meeting or the special general meeting, as the case may be, and such officer or person shall have all the powers and functions of the officer of the society authorised to convene such annual or special general meeting, under its bylaws.
Bye-laws Provisions relating to Special General Meeting :
Special General Body Meetings
A Special General Body Meeting of the Society may be called at any time at the instance of the Chairman or by the decision of the majority of the Committee and shall be called within one month of the date of the receipt or requisition, in writing signed by at least 1/5th of the Members of the Society or from the Registering Authority or from the Housing Federation, to which the Society is affiliated. The meeting so convened shall not transact any business, other than that mentioned in the Notice of the Meeting, fixing date, time and place for a Special General Body Meeting requisitioned.
The requisition for the special general body meeting of the Society, under thebye-law no. 95 shall be placed within 7 days of its receipt, before the Meeting of the Committee, by the Secretary of the Society, for fixing the date, time and place for the Special General Body Meeting of the Society.
The committee shall decide the date, time and place of every General Body Meeting of the Society and the business to be transacted thereat; provided that the business to be transacted at the requisitioned Special General Body Meeting shall be only that mentioned in the requisition. The notice convening the General Body Meeting shall be issued by the Secretary of the Society as provided in Bye-law no. 161. On his failure to issue the notice, the Chairman shall issue it.
In case of the Annual General Body Meeting, 14 clear day’s Notice and in the case of the special general body meeting, 5 clear day’s notice of the meeting shall be given to all the Members of the Society, as provided under Bye-law No. 161, under intimation to the Federation and to the Registering Authority. In case of an emergency, the Special General Body Meeting may be called even at a shorter notice, if the Committee unanimously decides to call the Special General Body Meeting at a shorter notice. The Agenda of such emergency meeting and the reasons of emergency for which the meeting is called shall be communicated in writing to all the Members. Also the decision of such meeting shall be communicated in writing to all the Members, within two days of such meeting.
The quorum for every general body meeting of the Society shall be 2/3rd of the total number of Members of the Society or 20, whichever is less.
Cancellation of the previous resolution of the general body meeting
No resolution can be brought at a General Body Meeting of the Society cancelling its previous resolution, unless six clear months have elapsed , after passing of the previous resolution.
After understanding law applicable we now turn to answer queries raised
Whether request for a Special General Meeting is prerogative of Society Members only?
Ans: In Negative A special general meeting may be called at any time by the Chairman special or by a majority of the committee and even Registrar as per the provisions discussed above.
Can Chairman OR management committee call for a Special General Meeting at any time or several times in a year for getting approval of a Agenda prepared by them ((not against a requisition from members) ?
Ans : As such no limit prescribed by law.
Can Chairman or Management Committee call for a Special General Meeting against a requisition received from society members, signed by only 5 members?
Ans: Section 76 (1) provides for on a requisition in writing of one-fifth of the members of the society of members the number of which is specified in the by-laws for the purpose, whichever is lower. However Bye-Law 95 provides for 1/5th members of the society. If there is any conflict between a statute or the rules framed thereunder and the Bye-Laws of the society, the Bye-Laws have to be ignored and cannot prevail. Judgment of Sau. Minakshi Murlidhar Ghodke 1997 (1) BomCR 422 ; Babaji Kondaji Garad Etc vs The Nasik Merchants Co-Operative 1984 AIR 192, 1984 SCR (1) 767
Is it that Chairman or management committee can call Special General Meeting ONLY AND ONLY when they receive a Requisition signed by 20% members of society, OR a request letter from Registering Authority OR a request letter from Housing federation and such Special General Meeting to be called by Chairman or managing committee at any time within one month from the date of such Requisition or letter?
Ans: Chairman can call Special General Meeting as per Bye-laws 95 read with Section 76(1)
Can Chairman OR Managing Committee declare the “Decisions made in a Special General Meeting ” as invalid?
Ans: Not before 6 months have elapsed from date of passing of resolution
Under what circumstances a Conducted Special General Meeting can be declared as invalid by Chairman OR Managing Committee?
The supremacy of the general body cannot be disputed but even the supreme general body has to be reasonable and has to pass rational resolution considering all the facts and circumstances of the matter. The general body cannot pass arbitrary and unreasonable resolutions merely because it is supreme and it has a large majority in favour of one of the issues on the agenda. The Venus Co-op. Housing Society and Anr. Vs. Dr. J. Y. Detwani & Ors 2003 (3) All.M.R. 570
Shruti Desai
5th July,2018
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