1

IN THE HIGH COURT OF AT BANGALORE

DATED THIS THE 15TH DAY OF JULY, 2013

B E F O R E

THE HON’BLE MR. JUSTICE A.N. VENUGOPALA GOWDA

WRIT PETITION NOS.21583-21622/2013(CS-RES)

BETWEEN:

1. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA MATHURU, SHIVAMOGGA TALUK & DISTRICT-577 201 BY ITS CEO: M VENKATESH MURTHY S/O M KRISHNAMURTHY, AGE:53 YEARS.

2. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA BILAKI, BHADRAVATHI TALUK & SHIVAMOGGA DISTRICT 577 301 BY ITS CEO:G M SOMASHEKAR S/O MALLAPPA G., AGE:41 YEARS.

3. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA KOODLIGERE, BHADRAVATHI TALUK SHIVAMOGGA DISTRICT 577 301 BY ITS CEO: R SANMANAS S/O RAMAKRISHNAN , AGE:40 YEARS.

4. ANAVERI VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA ANAVERI, BHADRAVATHI TALUK & SHIVAMOGGA DISTRICT 577 301 BY ITS CEO: H V GAJENDRA S/O H VEERABASAPPA, AGE:40 YEARS.

5. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA ARAKERE, BHADRAVATHI TALUK & SHIVAMOGGA DISTRICT 577 301 BY ITS CEO: H K RAGHU S/O H KARIBASAPPA, AGE:33 YEARS.

6. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA NIMBEGONDI, BHADRAVATHI TALUK & SHIVAMOGGA DISTRICT - 577 301 BY ITS CEO: K G MAHESHWARAPPA 2

S/O THIMMAPPANAVAR, AGE:40 YEARS.

7. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA VEERAPURA, BHADRAVATHI TALUK & SHIVAMOGGA DISTRICT 577301 BY ITS CEO: S DEVAPRASAD AGE:59 YEARS.

8. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA BADRAVATHI, SHIVAMOGGA DISTRICT 577 301 BY ITS CEO: N G THIPPESWAMY S/O S N GANGADHARAPPA, AGE:59 YEARS.

9. AREBILACHI VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA, AREBILACHI, BHADRAVATHI TALUK & SHIVAMOGGA DISTRICT - 577 301 BY ITS CEO: M H BASAVANAGOWDA S/O SHANKARAPPA, AGE:40 YEARS.

10. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA ANTHARAGANGE, BHADRAVATHI TALUK & SHIVAMOGGA DISTRICT - 577 301 BY ITS CEO: M C NANDISHKUMAR S/O M CHANDRAPPA, AGE: 39 YEARS.

11. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA SIRIGERE, BHADRAVATHI TALUK & SHIVAMOGGA DISTRICT - 577 301 BY ITS CEO: SIDDARAMAPPA S/O NAGAPPA, AGE:47 YEARS.

12. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA JAVALLI, SHIVAMOGGA TALUK & DISTRICT- 577 201 BY ITS CEO: C CHANDRASHEKAR S/O SANNABASAPPA, AGE:33 YEARS.

13. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA HARNAHALLI, SHIVAMOGGA TALUK & DISTRICT-577 201 BY ITS CEO: H VEERABHADRAPPA S/O LATE H C HALESHAPPA, AGE:36 YEARS.

14. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA HARAMAGATTA , SHIVAMOGGA TALUK & DISTRICT - 577 201 BY ITS CEO: K S PRAKASH S/O SOMASHEKARAPPA, AGE:38 YEARS. 15. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA 3

MELINA HANASAVADI, SHIVAMOGGA TALUK & DISTRICT - 577 201 BY ITS CEO: M K SHARATH KUMAR S/O M KARIBASAPPA, AGE: 39 YEARS.

16. SHIVAMOGGA KASABA VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA, KASABA, SHIVAMOGGA SAHAKARANAGARA, SHIVAMOGGA DISTRICT - 577 201 BY ITS CEO: MANJUNATH REDDY S/O RAMAREDDY, AGE:42 YEARS.

17. HANUMANTHAPURA VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA HANUMANTHAPURA, BHADRAVATHI TALUK & SHIVAMOGGA DISTRICT - 577 301 BY ITS CEO: H K NAGARAJ S/O GOPALKRISHNA, AGE:53 YEARS.

18. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA HOSAKOPPA, SHIVAMOGGA TALUK & DISTRICT-577201 BY ITS CEO: CHANDRASHEKAR M S/O MANGAPPA B., AGE:32 YEARS.

19. VYAVASAYA SEVA SHAKARA SANGHA NIYAMITHA TALLIKATTI, BHADRAVATHI TALUK & SHIVAMOGGA DISTRICT - 577301 BY ITS CEO: DHARMENDRA S/O C BOREGOWDA, AGE: 42 YEARS.

20. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA SUGURU, SHIVAMOGGA TALUK & DISTRICT-577201 BY ITS CEO: CHANDRASHEKAR M S/O MANGAPPA B., AGE:32 YEARS.

21. MULTIPURPOSE CO-OPERATIVE SOCIETY T.B.-1, NEW TOWN, BHADRAVATHI TALUK & SHIVAMOGGA DISTRICT-577301 BY ITS CEO: RAMU S/O K RAMAIAH, AGE:59 YEARS.

22. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA HIRIYUU, BHADRAVATHI TALUK & SHIVAMOGGA DISTRICT-577301 BY ITS CEO: B NARAYANANAIKA S/O BHEEMANAIKA, AGE:60 YEARS. 23. RAITHARA SEVA SAHAKARA SANGHA 4

HOLEHONNURU, BHADRAVATHI TALUK DISTRICT-577301 BYI TS CHIEF EXECUTIVE OFFICER: P S GURUNATHA S/O SIDDALINGAPPA, AGE:54 YEARS.

24. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA , SHIMOGGA TALUK & DISTRICT-577201 BY ITS CEO: K S RUDRESH S/O SHIVANANDAPPA, AGE:38 YEARS.

25. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA HASUDI, SHIVAMOGGA TALUK & DISTRICT-577301 BY ITS CEO: B K BASAVARAJACHARI S/O KUBERACHARI, AGE:32 YEARS.

26. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA CHORADI, SHIVAMOGGA TALUK & DISTRICT-577201 BY ITS CEO: J CHANDRANAIK S/O JULIYA NAIK, AGE:35 YEARS.

27. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA , SHIMOGGA TALUK & DISTRICT-577201 BY ITS CEO: B B HARISH S/O BASAVARAJAPPA, AGE:35 YEARS.

28. KADEKAL VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA KADEKAL, SHIVAMOGGA TALUK & DISTRICT-577201 BY ITS CEO: RAJU K S/O KALYANAIKA, AGE: 42 YEARS.

29. GAJANURU VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA GAJANURU, SHIVAMOGGA TALUK & DISTRICT-577201 BY ITS CEO: ANNAPPA S/O G B NAGESH, AGE:39 YEARS.

30. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA MALE SHANKARA, SHIVAMOGGA TALUK & DISTRICT-577201 BY ITS CEO: NAGARAJA K S/O KRISHNA NAIKA, AGE: 39 YEARS.

31. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA NIDIGE, SHIVAMOGGA TALUK & DISTRICT-577201 BY ITS CEO: K V RAKESH S/O K VEERAPPA, AGE: 37 YEARS.

32. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA 5

B BEERANAHALLI, SHIVAMOGGA TALUK & DISTRICT-577201 BY ITS CEO: K BASAVARAJAPPA S/O K B ESHWARAPPA, AGE:56 YEARS.

33. SINGAMANE VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA SINGAMANE, BHADRAVATHI TALUK & DISTRICT-577301 BY ITS CEO: G N JAYARAM S/O G N NINGAPPA, AGE:43 YEARS.

34. ABBALAGERE VYAVASAYA SEVA SAHAKARA NIYAMITHA ABBALAGERE, SHIVAMOGGA TALUK & DISTRICT-577201 BY ITS CEO: VISHWANATH M S/O MARDAPPA M., AGE: 31 YEARS.

35. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA UMBLE BAILU, SHIVAMOGGA TALUK & DISTRICT-577201 BY ITS CEO: S B VEERESH S/O SADASHIVAPPA S P., AGE:44 YEARS.

36. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA THYAJUVALLI, SHIVAMOGGA TALUK & DISTRICT-577201 BY ITS CEO: B SHANKARAPPA S/O BASAPPA, AGE:40 YEARS.

37. BHAGIRATHA HOPCOMS HOLEHONNURU, BHADRAVATHI TALUK & SHIVAMOGGA DISTRICT-577301 BY ITS SECRETARY: U K VIAJAYAKUMAR S/O KENCHAPPA U R., AGE:52 YEARS.

38. AYANURU VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA AYANURU, SHIVAMOGGA TALUK & DISTRICT-577201 BY ITS CEO: SHIVAKUMAR M S/O MANJAPPA, AGE: 35 YEARS.

39. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA MANDAGHATTA, SHIVAMOGGA TALUK & DISTRICT-577301 BY ITS CEO: B S NAGENDRAPPA S/O B SIDDAPPA, AGE:39 YEARS.

40. VYAVASAYA SEVA SAHAKARA SANGHA NIYAMITHA HOLALUR, SHIVAMOGGA TALUK & DISTRICT-577201 BY ITS CEO: K S RAJU S/O K SOMASHEKARAPPA, AGE:32 YEARS. ... PETITIONERS (BY SRI JAYAKUMAR S. PATIL, SENIOR ADVOATE FOR SRI MAHESH R. UPPIN, ADV.) 6

AND:

1. THE STATE OF KARNATAKA REP. BY ITS SECRETARY DEPARTMENT OF CO-OPERATION GOVERNMENT OF KARNATAKA BANGALORE - 560 001.

2. THE DIRECTOR OF CO-OPERATIVE AUDIT NO.17, JAYA NIVAS, SHANKAR MUTT ROAD BASAVANAGUDI BANGALORE - 560 006.

3. DEPUTY DIRECTOR OF CO-OPERATIVE AUDIT SHIVAMOGGA DISTRICT SHIVAMOGGA - 577 201. ... RESPONDENTS (BY SRI K.A. ARIGA, AGA )

THESE PETITIONS ARE FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF , PRAYING TO DECLARE THAT THE SECOND PROVISO TO SUB SECTION [1] OF SECTION 63 OF THE KCS ACT 1959 AS AMENDED BY SECTION 34 OF THE KARNATAKA ACT NO.3 OF 2013 PUBLISHED BY THE FIRST RESPONDENT, PUBLISHED IN THE KARNATAKA GAZETTE DATED 11.1.2013 VIDE ANNEXURE-B AS UNCONSTITUTIONAL AND VOID, ETC.

THESE PETITIONS COMING ON FOR FURTHER HEARING THIS DAY, THE COURT MADE THE FOLLOWING:

ORDER

Main prayer in these writ petitions is for a declaration that the second proviso to sub-section (1) of S.63 of the

Karnataka Co-operative Act, 1959 (for short, the Act), as

amended by S.34 of Karnataka Act No.3 of 2013, as unconstitutional and void and for quashing of the consequential communications – panels of Auditors, sent 7

by the Director of Co-operative Audit and for grant of consequential reliefs.

2. Heard the learned advocates on both the sides.

3. Seeking identical reliefs, certain co-operative societies, registered under the Act, had filed

W.P.Nos.79003-79014/2013. After hearing, the following questions were raised therein, for determination:

(i) Whether restricting the choice of a Co-operative Society to a panel of auditors and auditing firms, not exceeding ten, by the second proviso to sub-section (1) of Section 63 of the Act is arbitrary and violative of the proviso to clause (3) of Article 243ZM of the Constitution? Whether the restriction is also violative of Article 19(1)(c) & (g) of the Constitution? (ii) Whether the impugned communications restricting the choice of a Co-operative Society to a panel of three Auditors/Auditing firms is illegal?

Upon consideration of the rival contentions and while allowing the writ petitions on 05.07.2013, it has been held as follows:

“ 9. In my opinion, the restriction imposed by the second proviso to sub-section (1) of Section 63 of the Act restricting the choice of a Co-operative Society to choose an Auditor or an Auditing firm from a panel of auditors & auditing firms, not exceeding ten, is arbitrary and 8

violative of Article 14 of the Constitution . It is also violative of the proviso to clause (3) of Article 243ZM of the Constitution as the said constitutional proviso provides for a panel for the State i.e. one panel for the State and also gives a choice to every co-operative Society to choose any of the eligible auditors or auditing firms from the said panel. Hence, providing separate panels of a few names to every Co- operative Society in the State as per the impugned proviso is violative of the constitutional proviso . Though under Section 13(2) of the General Clauses Act, 1897 , words in the singular shall include the plural, and vice versa, the context does not admit of such a interpretation of the constitutional proviso i.e. permitting plurality of panels, like giving separate panels of a few names to every Co- operative Society in the State as is done now. Any law which contravenes the Constitutional provisions is unconstitutional and void. Therefore, the second proviso to sub-section (1) of Section 63 of the Act which restricts the choice of a Co-operative Society to choose an auditor or an auditing firm from a panel, not exceeding ten, is unconstitutional and void being violative of Article 14 and the proviso to clause (3) of Article 243ZM of the Constitution . Consequently, the communication sent to each of the petitioners giving a panel of only three names of auditors & auditing firms to select any one of them from the said panel to audit the accounts of their respective Co- operative Societies is also illegal. In the view I have taken, it is unnecessary to examine the contention re. violation of the fundamental rights under Articles 19(1)(c) & (g) of the Constitution . For the reasons stated above, I make the following order:

The second proviso to sub-section (1) of Section 63 of the Karnataka Co-operative Societies Act, 1959 is declared as unconstitutional and void and shall not be given effect to. Consequently, impugned communications are also set aside. ” 9

4. Perused the aforesaid Order. It is trite that a prior decision of this Court on identical facts and law binds the Court on the same points in a later case. Here, I have an Order, admittedly rendered on facts and law, indistinguishably identical, and that Order must bind.

Following the Order, noticed supra, these writ petitions are allowed. Since sub-section (1) of S.63 of the Act,

as amended by S.34 of Karnataka Act No.3 of 2013 having already been declared as unconstitutional, void and be not given effect to, it is unnecessary to grant the declaratory relief prayed in these petitions. However, in view of the Order, noticed supra, the impugned panels of auditors vide Annexures- C1

to C40 being arbitrary are quashed. Consequently, the petitioners shall get their accounts audited, in accordance with law.

No costs.

Sd/- JUDGE

sac*