Statutory powers in co-operative management cannot be usurped by executive direction; revisional power applies only within statutory limits.

Executive authorities could not direct extension or reconstitution of the first Board of Directors, because that statutory function under the bye-laws vested in the Registrar; such intervention was therefore invalid. The Registrar did have power under bye-law 29 to nominate, modify and curtail the tenure of the first Board, but the power had to be exercised independently and not at the behest of the Minister, so the impugned exercise was unsustainable. Section 65A revisional power also could not be invoked where no proceeding was pending and no relevant order existed. The challenged orders were held unsustainable and fresh election steps were directed in accordance with law.

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Issues: (i) whether the Chief Minister and the Minister could direct extension and reconstitution of the first Board of Directors by usurping the Registrar's statutory functions under the bye-laws and the Act; (ii) whether the Registrar had power under the bye-laws to reconstitute the first Board of Directors and curtail the extended term; (iii) whether the Government could act under the revisional power contained in section 65A of the Act in the absence of any pending proceeding or order.

Issue (i): whether the Chief Minister and the Minister could direct extension and reconstitution of the first Board of Directors by usurping the Registrar's statutory functions under the bye-laws and the Act

Analysis: The power to constitute the first Board of Directors under the bye-laws vested in the Registrar, and the incidental power to modify or reconstitute it also belonged to him. The executive authorities could not assume that statutory role by issuing directions to prolong the tenure of the nominated Board or by forwarding names for nomination. The Act and the rules were meant to secure broad-based and democratic co-operative management, and not to permit control by a few persons through executive intervention.

Conclusion: The directions issued by the Chief Minister and the Minister were without authority and were invalid.

Issue (ii): whether the Registrar had power under the bye-laws to reconstitute the first Board of Directors and curtail the extended term

Analysis: The proviso to bye-law 29 empowered the Registrar to nominate the first Board for a limited period and to modify the nomination when required. The words extending tenure until further orders preserved the Registrar's power to curtail the tenure and reconstitute the Board. The power to reconstitute therefore existed under the bye-laws, but it had to be exercised independently and not at the behest of the Minister.

Conclusion: The Registrar had the power to reconstitute the Board, but the impugned exercise of that power was invalid because it was not an independent decision.

Issue (iii): whether the Government could act under the revisional power contained in section 65A of the Act in the absence of any pending proceeding or order

Analysis: Section 65A conferred a revisional power on the State Government to call for records and pass orders in respect of matters pending before the Registrar or his subordinate. No proceeding was pending and no relevant order had been passed that could attract this power. The State Government therefore could not invoke section 65A to take over the Registrar's statutory role.

Conclusion: Section 65A did not authorise the action taken by the executive authorities.

Final Conclusion: The appeal succeeded, the challenged orders were held unsustainable, and the Court directed immediate administrative steps to take over the management and hold a fresh election of the Board in accordance with law.

Ratio Decidendi: Executive authorities cannot usurp statutory functions assigned to the Registrar under co-operative law, and revisional power can be exercised only within the limits and conditions expressly provided by the statute.

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