1

IN THE HIGH COURT OF AT BANGALORE

DATED THIS THE 17TH DAY OF JULY, 2013

B E F O R E

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

WRIT PETITION NOS.31384-31412/2013 (CS-RES)

BETWEEN:

1. MINDA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA MINDA HALLI, TLAUK DISTRICT-513630 BY ITS SECRETARY: MUNIRAJU, AGE:45 YEARS.

2. SEETHA HALLI HALA UTPADAKARA SAHAKARA SANGHA NIYAMITHA, SEETHA HALLI MALUR TLAUK, -513630 BY ITS SECRETARY: ABDULLA KHAYUM S/O MUNAVARASHARIFF, AGE: 45 YEARS.

3. HULADENA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA HULADENA HALLI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: MURALI S/O LAKSHMAIAH, AGE:33 YEARS.

4. YELAVAGULI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA YELAVAGULI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: Y N SRINIVASA S/O LATE NARAYANAPPA, AGE:48 YEARS.

5. ARALERI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA ARALERI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: K BHADRAPPA S/O KRISHNAPPA, AGE:46 YEARS.

2

6. DHADHINAYAKANADHODDI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA DHADHINAYAKANADHODDI MALUR TLAUK, KOLAR DISTRICT-513630 BY ITS SECRETARY: D V SURESHA S/O VENKATAGIRIYAPPA, AGE:35 YEARS.

7. HULKURU HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA HULKURU, MALUR TALUK KOLAR DISTRICT-51363 BY ITS SECRETARY: NAGESHA S., S/O SIDDAPPA, AGE:36 YEARS.

8. DODDAKADATURU HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA DODDAKADATURU, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: V GURAPPA S/O VENKATAPPA, AGE:55 YEARS.

9. VENKATARAJANNA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA VENKATARAJANA HALLI MALUR TALUK, KOLAR DISTRICT-513630 BY ITS SECRETARY: V M MUNIYAPPA S/O MUNISHAMAPPA, AGE:40 YEARS.

10. DODDASABBENA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA DODDASABBENA HALLI MALUR TALUK, KOLAR DISTRICT-513630 BY ITS SECRETARY: D N CHANDRAPPA S/O NARAYANAPPA, AGE:44 YEARS.

11. MIRAPANA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMIHTA, MIRAPANA HALLI, MALUR TLAUK, KOLAR DISTRICT-513630 BY ITS SECRETARY: M B NANJEGOWDA S/O BHACHANNA, AGE: 38 YEARS.

12. DINNA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA DINNA HALLI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: T. NARAYANAGOWDA 3

S/O THIMMARAYAPPA, AGE: 46 YEARS.

13. THOLAKANA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA THOLAKANA HALLI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: T.K. VENUGOPAL S/O KRISHNAPPA, AGE: 36 YEARS.

14. HUNGENA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA HUNGENA HALLI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: H.V. MUNENDRA S/O VENKATESHAPPA, AGE: 35 YEARS.

15. JAGADENA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA JAGADENA HALLI , MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: A. GOPALA REDDY S/O ANNAIAH REDDY, AGE: 40 YEARS.

16. CHIKKATIRUPATHI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA CHIKKATIRUPATHI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: A. SATYANARAYANA, S/O ANANTHAIAH, AGE: 50 YEARS.

17. SONNA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA SONNA HALLI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: M. SHIVAKUMAR S/O MUNIYAPPA, AGE: 40 YEARS.

18. SEETANAYAKANA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA SEETANAYAKANA HALLI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: V. AMARESH S/O VENKATASWAMY REDDY, AGE: 41 YEARS.

19. HULIMANGALA HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA HULIMANGALA, MALUR TALUK 4

KOLAR DISTRICT-513630 BY ITS SECRETARY: H.N. RAJA REDDY S/O NANJUNDA REDDY, AGE: 44 YEARS.

20. BHARAGURU HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA BHARAGURU, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: P. RAJANNA S/O PAPACHAPPA, AGE: 52 YEARS.

21. SANTHENA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA SANTHENA HALLI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: VITALA NARAYANA GOWDA S/O GOPALA KRISHNA GOWDA, AGE: 46 YEARS.

22. GANIGANA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA GANIGANA HALLI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: G. RAMESHA S/O G.T. GIRIYAPPA, AGE: 42 YEARS.

23. H.HOSAKOTE HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA HOSAKOTE, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: H.P.SRINIVASA REDDY S/O PRAKASHA REDDY, AGE: 44 YEARS.

24. THORA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA THORA HALLI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: N.RAMESH, S/O NARASIMMAIAH, AGE 40 YEARS.

25. HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA BANTA HALLI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: B.R.MANOHARA REDDY, S/O RAMAKRISHNA REDDY, AGE 33 YEARS.

26. INDUMANGALA HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA 5

INDUMANGALA, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: D.V.NARAYANASWAMY, S/O VENKATASWAMY, AGE 48 YEARS.

27. SAMPANGERE HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA, SAMPANGERE, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: S.V.PRABHAKAR, S/O VENKATARAMAIAH, AGE 46 YEARS.

28. ARASANA HALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA, ARASANA HALLI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: VISHWANATH, S/O K.NAGARAJ, AGE 40 YEARS.

29. KURNA HOSALLI HALU UTPADAKARA SAHAKARA SANGHA NIYAMITHA, KURNA HOSALLI, MALUR TALUK KOLAR DISTRICT-513630 BY ITS SECRETARY: GOPALA KRISHNAGOWDA K., S/O KRISHNAPPA, AGE 44 YEARS. ... PETITIONERS

(BY SRI MAHESH R. UPPIN, ADV.)

AND:

1. THE STATE OF KARNATAKA REP. BY ITS SECRETARY DEPARTMET OF CO-OPERATION GOVERNMENT OF KARNATAKA BANGALORE-560001.

2. THE DIRECTOR OF CO-OPERATIVE AUDIT, NO.17, JAYA NIVAS, SHANKAR MUTT ROAD, BASAVANAGUDI, BANGALORE – 560 009.

3. DEPUTY DIRECTOR OF CO-OPERATIVE AUDIT, KOLAR DISTRICT, KOLAR – 563 101. … RESPONDENTS (BY SRI K.A. ARIGA, AGA) 6

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 AS AMENDED BY SECTION 34 OF THE KARNATAKA ACT NO.3 OF 2013 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

Sri K.A. Ariga, learned AGA accepts notice on behalf of respondents. With the consent of learned advocates appearing on both sides, case is taken up for final disposal.

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

3. Seeking identical reliefs, certain co-operative societies, registered under the Act, had filed 7

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 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 8

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. ”

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 9

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 C29 being arbitrary are quashed. Consequently, the petitioners shall get their accounts audited, in accordance with law.

No costs.

Sri K.A. Ariga is permitted to file memo of appearance within four weeks.

Sd/- JUDGE

sac*