Mandatory compliance with RBI directives under cooperative banking law leaves no discretion, hearing requirement, or section 102 procedure.

Section 110A(1)(iii) was analysed as a mandatory mechanism for implementing a binding RBI directive on suspension or supersession of a co-operative bank's board, leaving the Registrar no discretion to depart from that direction. On that basis, prior show-cause notice and personal hearing were held unnecessary, and the resulting action was treated as administrative rather than quasi-judicial. The commentary also states that the amendment reducing the maximum period to one year was consistent with Article 243ZL, with no repugnancy. It further distinguishes Section 102 winding-up procedure as inapplicable to action under Section 110A(1)(iii).

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Issues: (i) Whether prior show-cause notice and personal hearing were required before supersession of the board and appointment of an administrator; (ii) whether the Registrar had any discretion to ignore or vary the Reserve Bank of India's directive; (iii) whether the amendment to Section 110A(1)(iii) of the Maharashtra Co-operative Societies Act, 1960 was in conformity with Article 243ZL of the Constitution of India and whether there was repugnancy; (iv) whether the impugned order was quasi-judicial or administrative; (v) whether the Registrar had to follow Section 102 procedure while acting under Section 110A(1)(iii).

Issue (i): Whether prior show-cause notice and personal hearing were required before supersession of the board and appointment of an administrator.

Analysis: The impugned action was taken by the Registrar only to implement the directive issued by the Reserve Bank of India under Section 110A(1)(iii) of the Maharashtra Co-operative Societies Act, 1960. The provision, as interpreted in earlier decisions and applied here, does not contemplate a quasi-judicial hearing before implementation of the RBI's mandate. The order was passed in the context of protecting depositor interest and securing proper management of the bank.

Conclusion: No prior show-cause notice or personal hearing was required, and this issue is decided against the petitioners.

Issue (ii): Whether the Registrar had any discretion to ignore or vary the Reserve Bank of India's directive.

Analysis: The statutory scheme was held to place the discretion at the stage of the RBI's decision to require suspension or supersession, not at the stage of the Registrar's compliance. The word "shall" in Section 110A(1)(iii) was treated as mandatory. The Registrar was bound to act in accordance with the RBI's directive and could not choose a different course on its own.

Conclusion: The Registrar had no discretion to disregard or modify the RBI's directive, and this issue is decided against the petitioners.

Issue (iii): Whether the amendment to Section 110A(1)(iii) of the Maharashtra Co-operative Societies Act, 1960 was in conformity with Article 243ZL of the Constitution of India and whether there was repugnancy.

Analysis: The amendment reducing the maximum period from five years to one year was held to align with the constitutional scheme under Article 243ZL, including its provisos relating to co-operative societies carrying on banking business. The Court rejected the contention that the constitutional provision and the statute were repugnant, and held that the constitutional provision did not prevail over the statute on this ground because both operated consistently.

Conclusion: The amendment was in conformity with Article 243ZL and there was no repugnancy, so this issue is decided against the petitioners.

Issue (iv): Whether the impugned order was quasi-judicial or administrative.

Analysis: The order was characterised as an executive and administrative act undertaken to carry out a binding statutory direction from the Reserve Bank of India. Since it was not a quasi-judicial determination, the safeguards associated with adjudicatory proceedings were not attracted.

Conclusion: The impugned order was administrative in nature, not quasi-judicial, and this issue is decided against the petitioners.

Issue (v): Whether the Registrar had to follow Section 102 procedure while acting under Section 110A(1)(iii).

Analysis: Section 102, which deals with winding up, operates in a different field from Section 110A(1)(iii), which concerns compliance with RBI directives for suspension or supersession of the board. The two provisions were held to be distinct, and the winding-up procedure was not a prerequisite for action under Section 110A(1)(iii).

Conclusion: The Registrar was not required to follow Section 102 procedure while acting under Section 110A(1)(iii), and this issue is decided against the petitioners.

Final Conclusion: The challenge to the supersession order failed in all material respects, and the Court upheld the action taken in compliance with the Reserve Bank of India's directive.

Ratio Decidendi: Where the statute makes the Registrar's action contingent on a directive of the Reserve Bank of India, the Registrar must comply with that directive as a mandatory administrative function, and no prior hearing is required unless the statute expressly provides otherwise.

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