Saji Koduvath, Advocate.
1. Provisions of the Societies Registration Act, 1860:
- 3. Registration and fees: Upon such memorandum and certified copy being filed, the Registrar shall certify under his hand that the society is registered under this Act. There shall be paid to the Registrar for every such registration a fee of fifty rupees, or such smaller fees as [the State Government] may from time to time, direct; and all fees so paid shall be accounted for to [the State Government].
- 4. Annual list of managing body to be filed:- Once in every year, on or before the fourteenth day succeeding the day on which, according to the rules of the society, the annual general meeting of the society is held, or, if the rules do not provide for an annual general meeting, in the month of January, a list shall be filed with the Registrar of joint-stock Companies, of the names, addresses and occupations of the governors, council, directors, committee or other governing body then entrusted with the management of the affairs of the society.
- 20. To what societies Act applies: The following societies may be registered under this Act:– Charitable societies, the military orphan funds or societies established at the several presidencies of India, societies established for the promotion of science, literature, or the fine arts for instruction, the diffusion of useful knowledge, [the diffusion of political education], the foundation or maintenance of libraries or reading-rooms for general use among the members or open to the public or public museums and galleries of paintings and other works of art, collections of natural history, mechanical and philosophical inventions, instruments, or designs.
- Section 8 (2) Companies Act, 2013 reads: The company registered under this section shall enjoy all the privileges and be subject to all the obligations of limited companies.
2. Introduction
India has a long history of collective community life. Ancient history of India manifested in oldest scriptures of Hinduism – Vedas – refers to then existed strong civil society. Voluntary organisations were originated for promotion of health, education and cultural activities. Religious organizations promoted charitable trusts with a philanthropic view. The Government recognised these voluntary organizations and trusts by various enactments. The oldest enactments in this regard include:
- The Societies Registration Act, 1860,
- The Religious Endowments Act, 1863,
- The Indian Trusts Act, 1882,
- The Charitable Endowments Act, 1890,
- The Charitable and Religious Trusts Act, 1920 and
- The Trade Unions Act, 1926.
It is noteworthy that these enactments did not impose strong governmental control over various activities of the associations and the institutions.
3. So. Regn. Act does not Require Compulsory Registration
Because Article 19(1)(c) of our Constitution guarantees freedom to form associations.
Societies Registration Act, 1860 does not require compulsory registration of Societies. This position continues. No doubt, it is because Article 19(1)(c) of our Constitution guarantees freedom to form associations and unions. But, Tamil Nadu Societies Registration Act, 1975 directs compulsory registration of certain societies.
Tamil Nadu Societies Registration Act, 1975 Sec. 4 reads:
- 4. Compulsory Registration of Certain Societies –
- (1) Subject to the provisions of Sub-sections (3) and (4), every society formed on or after the date of the commencement of this Act, which has for its object any object mentioned in, or prescribed Under Section 3, and
- (a) which consists of not less than twenty members, or
- (b) whose annual gross income or expenditure in any financial year after the date of the commencement of this Act, is not less than ten thousand rupees, shall be registered under this Act within such period as may be prescribed.
- (2) …..
- (3) Nothing in this section shall apply to any society which has for its object the promotion of religion, athletics or sports (including indoor games).
- (4) Nothing contained in this Act shall be deemed to require the registration under this Act of any society formed, established, registered or incorporated under any other law.
4. General Principles of Company Law Apply to Regd. Society.
The general principles governing rights of a member in a registered society, and the right of suit of a member, would be similar to that of an individual share holder’s rights in a company. The general principles as to the rights and responsibilities of the directors of a company also apply to the governing body members of a society.
Following are recognised as individual membership rights in a company.[1]
- (i) Right to vote,
- (ii) right to stand as a candidate for election as a director and
- (iii) set-right illegal acts.
The general principles as to the rights and responsibilities of the directors of a company also apply to the governing body members of a society.
5. Registration of Societies Brings-in Certain Privileges
In Board of Trustees, Ayurvedic & Unani Tibia College, Delhi Vs. The State of Delhi[2] the legal position is expounded by our Apex Court pointing out that by registration of a Society, perpetual succession is conceded inasmuch as the society’s property vest in the trustees for the time being of the society for the use and benefit of the society and its members and of all persons claiming through the members according to the society’s rules, and further (and this is the most noteworthy provision) that the property shall pass to succeeding trustees without assignment or transfer. In this decision it is observed as under:
- “… The most important point to be noticed in this connection is that in the various provisions of the Societies Registration Act, 1860, there are no sufficient words to indicate on intention to incorporate; on the contrary, the provisions show that there was an absence of such intention. ….. Section 5, however, states that the property belonging to the society, if not vested in trustees, shall be deemed to be vested in the governing body of the society and in all proceedings, civil and criminal, the property will be described as the property of the governing body. The section talks of property belonging to the society; but the property is vested in the trustees or in the governing body for the time being. The expression “property belonging to the society” does not give the society a corporate status in the matter of holding or acquiring property, it merely describes the property which vests in the trustees or governing body for the time being……..”
- “… Those provisions undoubtedly give certain privileges to a society registered under that Act and the privileges are of considerable importance and some of those privileges are analogous to the privileges enjoyed by a corporation, but there is really no incorporation in the sense in which that word is legally understood.”
In Pamulapati Buchi Naidu College Committee, Nidubrolu Vs. Govt. of AP[3] it was observed that if an association was not registered as a society under the Societies Registration Act it could not sue or be sued except in the name of all the members of the association. The registration of the Society confers on it certain advantages. The members as well as the Governing Body the Society are not always the same. Even though the members of the Society or the Government Body fluctuate from time to time, the identity of the society is sought to be made continuous by reason of the provisions of the Societies Registration Act.
Effect of Registration of an Unregistered Society
In Noel Frederick Barwell Vs. John Jackson, AIR 1948 All 146, it was observed as under:
- “69. The case in Oldhamour Lady’s Sick and burial Society v. Taylor (1887) 3 T.L.R. 472 has, to my mind, no relevance. That was-a case where after the registration of an unregistered society, which was registered by a vote of the majority the minority then having decided to secede, the question was whether the registered society could claim the money due to the unregistered society and it was held that it was the same society and there was a continuity of existence.”
Person who Signs Pleadings must be Authorised by the Byelaws
The Supreme Court, in P. Nazeer Vs. Salafi Trust, AIR 2022 SC 1580, held:
- (i) A society registered under the Societies Registration Act is entitled to sue and be sued, only in terms of its byelaws.
- (ii) The byelaws may authorise the President or Secretary or any other office bearer to institute or defend a suit for and on behalf of the society,
- since section 6 of the Societies Registration Act, provides that ‘every society registered under the Act may sue or be sued in the name of President, Chairman, or Principal Secretary, or trustees, as shall be determined by the rules and regulations of the society and,
- in default of such determination, in the name of such person as shall be appointed by the governing body for the occasion’.
- (iii) Unless the plaintiff, which claims to be a society, demonstrates that it is a registered entity and that the person who signed and verified the pleadings was authorised by the byelaws to do so, the suit cannot be entertained
- The fact that the plaintiff in a suit happens to be a local unit or a Sakha unit affiliated to a registered society is of no consequence, unless the byelaws support the institution of such a suit.
6. Registration Brings-in Certain Changes to the Character of its Property
A society or a club is a compendium of its members. Its property is the ‘joint property’ held by the members as ‘joint tenants’ (as differentiated to ‘tenants in common’, till a decision is taken for dissolution). If such property is maintained for the benefit of its future members also (and therefore encumbered with obligations as in a ‘trust’), it cannot be dealt with by the members disregarding the objectives of its foundation.
With respect to the property of a society which can be distributed among the members on its dissolution, by registration under the Societies Registration Act a sea-change occurs whereby the disposal of property is governed by the provisions of the Societies Registration Act; and a perpetual succession is conceded thereto.[4]
Benefits Brought About by Registration of Societies.
- Legal recognition and Benefits of Entry in Public Document. The Societies Registration Act provides for registering its bye laws and filing annual list of managing body and accounts. It is subject to scrutiny of Registrar. The registration and renewal of the registration of the society is for the benefit of all the members and office bearers of the society[5]so also the persons who deal with the society. A registered society can open bank accounts and obtain registration under Income Tax Act.
- Perpetual Succession. By registration of a Society, perpetual succession is conceded inasmuch as the society’s property vest in the trustees or its governing body, for the use and benefit of the society;or in its members and of all persons claiming through the members according to the society’s rules.[6]
- And further (and this is the most noteworthy provision) that the property shall pass to succeeding trustees or its governing body without assignment or transfer.[7]
- Enabling Provisions for Filing Suits. Suits with respect to registered societies can be filed without invoking the provisions of Order 1 Rule 8 CPC;[8] and can be sued also in that way.
- Fixity. During the subsistence of a registered society, or on dissolution, the members do not have any proprietary or beneficial enjoyment/interest in the property the society holds.[9] The Societies Registration Act, therefore, does not create in the members of the registered society any interest other than that of bare trustees. What all the members are entitled to, is the right of management of the properties of the society subject to certain conditions.[10]
- Left-behind-property goes to another society: As per the Societies Registration Act, on dissolution, the left-behind-property of a registered society goes to another society as determined by the members of the society or by the court[11] for being managed by some other charitable organisation and to be utilised for like purposes.
- Tax Exemptions. Registration of Societies permits certain tax benefits and exemptions as provided in various Tax Laws.
So. Regn. Act: Holding Annual General Meeting is Statutory; Election Not
Sec. 4 of the Societies Registration Act, 1860 postulates holding of Annual General Meeting. These provisions (also the Memorandum and Articles of Association of the society) as to holding Annual General Meetings, are mandatory; and not directory (Sarbjit Singh Vs. All India Fine Arts & Crafts Society: ILR 1989-2 Del 585). As per Sec. 2 of the Societies Registration Act the management of the affairs of a society is entrusted with the governing body. The rules of the society have to direct the details of such entrustment.
It is pertinent to note that the Societies Registration Act, 1860 does not specifically direct ‘election’ of the governing body. But various States’ amendments (and State-Acts) provide for the same. The mode and modalities of formation of the governing body is determinedly left, under Sec. 16, to the ‘Rules and Regulations of the society’.
Sec. 16 reads:
- Governing body defined: The governing body of the society shall be the governors, council, directors, committee, trustees, or other body to whom by the rules and regulations of the society the management of its affairs is entrusted.
See Blog: Election & Challenge in Societies and Clubs
7. Religious Societies & Charitable Purposes
A Religious-Society Can be Registered If it Carries on Secular Activities Also
Society formed for religious purposes can also be registered under the Societies Registration Act, as the society formed for religious purposes would also ordinarily be a Society for charitable purposes.[12] Though the expression charitable purpose generally takes-in religious purpose also, it is held by the Patna High Court in Md. Yunus Vs. The Inspector General of Registration[13] that the So. Regn. Act does not embrace purposes which are religious or predominantly religious.
9. How Can a Society or a Club Acquire Property and Enter into a Contract?
See Blog: Vesting of Property in Societies and Clubs
10. Associations Regd. under S. 8(1) of the Companies Act, 2013
Incorporation of Clubs brings in Legal Personality
Section 8 (1) of the Companies Act, 2013, lays down that an association of persons with charitable objects can be registered under this Act. It should have ‘in its objects the promotion of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment or any such other object’ and it should be one which ‘intends to apply its profits, if any, or other income in promoting its objects’.
Clubs incorporated under the Companies Act enjoy all the privileges of limited companies; and they are subject to all the obligations thereunder also. Section 8 (2) Companies Act, 2013 reads:
- “(2) The company registered under this section shall enjoy all the privileges and be subject to all the obligations of limited companies.”
Privileges
- exempted from requirement regarding minimum share capital.
- exempted from requirement to mention its name and address as required in case of all other companies
- free to determine the date, place and time of its Annual General Meeting according to their convenience and feasibility.
- can call an Annual General Meeting at a short notice
- can maintain books of accounts for a shorter period.
- send the required documents at least fourteen days before the date of meeting instead of 21 days.
- free to increase the number of its directors without seeking approval of central Government.
- exempted from the applicability of Companies Auditor’s Report Order, 2003 (CARO).
Obligations
- ensure that its profits and all other incomes are utilized only for the purpose of promoting its objects and not for any other purpose
- ensure that its profits are not distributed as dividend among its members
- cannot alter its objects clause in its Memorandum without seeking the written approval of central government
- bound by such conditions and regulations imposed by Central Government
- ensure that its objects are confined to those mentioned in section Section 8 (1) of the Companies Act, 2013.
Halsbury’s Laws of England[14] describe Incorporated Members’ Club as under:
- “206. Incorporated Members’ Club. – A members’ club incorporated under the Companies Act, 1948, or earlier Companies Acts, enjoys the advantages incidental to incorporation as a company, especially that of suing and being sued as a legal entity. The company may be limited by shares or by guarantee, and in either case the liability may be merely nominal in amount. The most convenient method, when a members’ club is incorporated, is to register it as a company limited by guarantee, the members of the club for the time being constituting the company. If a members’ club is incorporated as a company limited by shares, the articles of association to some extent take the place of club rules, and may be supplemented by bye laws. If it is registered as an association limited by guarantee, the rules governing the relations of the members inter se are generally appended to the memorandum of association, and they together form the regulations of the company. In either case the objects of the club are set forth in the memorandum of association. The company is quite distinct from the club, the company merely being the proprietor; the relations of the members of the club inter se are governed by club rules or bye laws, as in the case of an unincorporated members’ club, and the rights and liabilities of the share-holders in the company depend upon the memorandum and articles of association, as in the case of an ordinary trading company.”
11. Registered Society is not a Juristic Person
See Blog: Is Registered Society a Juristic Person.
12. Regd. Societies – Not Corporate Body & No Common Seal
A society registered under the Societies Registration Act, 1960 is not a body corporate having perpetual succession and common seal.[15] But, a Co-operative Society, created by or under a statute,[16] is a body corporate having perpetual succession and a common seal with power to hold property; and it can enter into contracts.[17]
13. Societies Considered as Legal Persons While Deal Tax Matters
Generally, public institutions established with a philanthropic view and administered by trustees are described as ‘trusts’, especially while dealing with tax matters, though, in the strict legal sense, trust is a concept and it cannot be an organisation or a Juristic Person.[18]
In Swami Satchitanand Vs. The 2nd Addl. Income-tax Officer, Kozhikode[19] the Kerala High Court observed that a society registered under Societies Registration Act is a legal entity; and it is held that tax imposed on a Society, though it has been styled as an ‘Association of persons’ is still a tax on the society and not on its members, and that it is not possible, therefore, to say that the tax imposed on a Society is a tax imposed on the members of the Society.
14. Does a Society or Branch Registered with Another Registered Society Get the Status as a Registered Society?
See Blog: Societies and Branches
15. Registrar Acts on Prima Facie Materials
If a dispute arises as to whom among the two sets were the lawful members of the Governing Committee, the Registrar has the power to decide upon such a dispute under the Societies Registration Act as an incidental or consequential power in itself. The Registrar has to prima facie satisfy from the materials and evidences. There may not be an elaborate enquiry. However, such an enquiry made by the Registrar and the decision taken from it does not become final and the aggrieved party can take up the matter before a competent court for a decision as to who are the members of the governing body.[20]
16. Jurisdiction of State and Registrar: Limited
The District Registrar has no power to interfere with the selection in the election process. The scope of exercising power under the Societies Registration Act is only to limited extent. The enquiry is not directed against election or selection but to find out the genuineness of the list.
The disputes are to be resolved by the Civil Court
Sec. 4 of the So. Regn. Act casts a duty on the persons concerned to file before the registrar an annual return containing the names, addresses and occupation of the members of the Executive Committee. But the law does not provide for the suspension or dissolution of the society because of failure to comply with Sec. 4. The Act does not vest any control or supervisory or disciplinary power or jurisdiction in the registrar to take action against a society. The disputes are to be resolved by the Civil Court.[21]
Once a list is furnished in accordance with the election, the scope of enquiry would come to an end, even if the selection is bad. The extent of enquiry is only to find out whether the list being furnished is not by way of any bogus claim or by fraudulent claim.[22]
17. Co-op. Registrar’s Powers Regulatory or Supervisory in Nature
A Co-operative society is an autonomous body and it has got a freedom of its own and such freedom can be interfered only when they violate the provisions of the bye-laws and act in an arbitrary manner. When they violate the provisions of the bye-laws and the Act in an arbitrary manner, or resort to activities prejudicial to the interest of the society, their actions will be subject to the supervisory control of the authorities under the Act.[23] Except supervisory role, the State has no administrative control over the day-to-day affairs of a Co-operative society.[24] It will not amount to dominating or interfering with the management or affairs of the Co-operative society so as to be controlled.The supervisory powers are given to the Co-operative Registrar and the executive powers are given to the Secretary with ‘a single object in view, namely, the better working of the Co-operative societies’[25]
AK Ganguly, J. in The Dakshinee Co-Operative Housing Society Ltd. Vs. Nayan Ranjan Das[26] has observed that democratic norms or democratic principles always presuppose regulatory measures since democracy cannot exist without moderation and that such provisions in the Act strengthen the larger interest of the co-operative movement in general.
Our Apex Court, in Thalappalam Ser. Co-op. Bank Ltd. Vs. State of Kerala,[27] it is pointed out that the final authority of a society vests in the general body of its members and every society is managed by the managing committee constituted in terms of the bye-laws, and unequivocally held that the powers of Registrar of Co-operative Societies are only ‘regulatory or supervisory’ in nature and it ‘will not amount to dominating or interfering with the management or affairs of the society so as to be controlled’.
18. States’ Amendments/Acts Empower Registrar
Though the Central Act does not specifically empower the Registrar to enquire into the affairs of the society, various States’ Amendments/Acts provide for the same.
Tamil Nadu Societies Registration Act
Considering Section 36(1) of the Tamil Nadu Societies Registration Act, 1975, it is held in CMS Evangelical Suvi David Vs. District Registrar[28] that the power of the Registrar to enquire into the affairs of the society was only to hold a summary inquiry for his own satisfaction. The said power cannot be construed as the power of appeal. Under Section 36, the Registrar has not been empowered to adjudicate upon the conflicting claims to represent the society based upon question of fact. A plain reading of Section 36 shows that the Registrar could look only the provisions of the Act and the Rules and prima facie materials to arrive at a conclusion either to believe or not to believe.
The power of the Registrar to call for information and explanation under Section 34 does not contemplate any power to examine witnesses or to allow opportunity for cross-examination of witnesses. The power is incidental and it is only for the purpose of maintaining correct records. As the power to conduct inquiry is only limited – in order to find out whether constitution of members are valid – the inquiry is limited only for the purpose of making entries in the register. However, the exercise of power must not be arbitrary as the orders passed or directions issued by the Registrar are amenable to challenge in the Writ Jurisdiction.[29]
19. Super-session of Governing Body by Government – M.P. Act
A few States, in their Societies Registration Acts, give power, to the Government to supersede societies. Section 32 of the MP Societies Registrikaran Adhiniyam, 1973, Registrar is authorised to hold an enquiry into the constitution and working and financial conditions of the society. Section 33 of the Act speaks of supersession[30] of the Governing Body by the State Government by removing the governing body and appointing a person or persons to manage the affairs of the society for a specified period not exceeding two years in the first instance.
Sec. 33 of the MP Societies Registrikaran Adhiniyam, 1973 reads:
- “33. Super-session of Governing Body.— (1) If, in the opinion of the Government, governing body of any State aided society—
- (a) persistently makes default or is negligent in the performance of the duties imposed on it by or under this Act, regulations or bye-laws of the society or by any lawful order passed by the State Government or Registrar, or is unwilling to perform such duties, or
- (b) commits acts which are prejudicial to the interest of society or its members, or
- (c) is otherwise not functioning properly, the State Government may, by order in writing, remove the governing body and appoint a person or persons to manage the affairs of the society for a specified period not exceeding two years in the first instance.
- Provided that where it is proposed to remove the governing body of the society exclusively on the ground that election to the governing body were not held in accordance with the provisions of this Act or the regulations or bye-taws made thereunder, no action shall be taken under this sub-section unless the Registrar or an officer authorised by him in this behalf has convened a meeting of the General body for conducting the election thereto in accordance with the provisions of this Act, or the Regulations or bye-laws made thereunder but has failed to get the new governing body elected.
- Provided further that the Registrar or the Officer authorised by him shall, for the purpose of conducting election, have all the necessary powers under the Act or the Regulations or bye-laws made thereunder.
- (2) No order under Sub-section (1) shall be made unless the governing body has been given a reasonable opportunity of showing cause against the proposed order and representation, if any, made by it, is considered.
- (3) …. (4) ….. (5) …. (6) …. (7) …. (8) …..”
It is held in Suresh Vs. State of MP[31] that the power of supersession was not an administrative power but was a quasi-judicial in nature. In Indian National Congress Vs. Institute of Social Welfare[32] it is observed by the Supreme Court, when it considered as to what constitutes exercise of quasi judicial power, as under:
- “24. The legal principles laying down when an act of a statutory authority would be a quasi-judicial act, which emerge from the aforestated decisions are these: Where
- (a) a statutory authority empowered under a statute to do \any act
- (b) which would prejudicially affect the subject
- (c) although there is no lis or two contending parties and the contest is between the authority and subject and
- (d) the statutory authority is required to act judicially under statute, the decision of the said authority is quasi-judicial.”
20. Power to Grant Interim Orders by Registrar – Karnataka Act
Section 25 of the Karnataka Societies Registration Act provides for an enquiry into the constitution and working of the registered society by the Registrar on his own motion or on the application of the majority of the members or on the complaint given by 1/3rd members of the society. The Act further gives power to the Registrar to issue notice for general body meeting of the society and require the governing body of the society to call a general meeting and to determine such matters as may be directed by him. The Registrar has the ancillary powers to summon any person and examine him.
It is held in Advocates Association Vs. District Registrar and Registrar of Societies[33] that if certain material irregularities were brought to the notice of the registrar and if he was of the opinion that granting of an interim order pending disposal of the enquiry was in furtherance of final order to be passed, the power can be traced under Section 25 itself regarding enquiry. It was observed that the authority which was supposed to hold an enquiry would have the power to grant an interim order, in aid of the final relief, even though it may not be traced to any of the provisions of the Act.
21. Powers of Registrar to Direct Election – Karnataka Act
Following Kodava Samaj, Bangalore Vs. District Registrar of Registration of Societies, Bangalore[34] it is held in Advocates Association Vs. District Registrar and Registrar of Societies[35] that under the Karnataka Societies Registration Act the Registrar has power to direct the society to hold an election, because an enquiry into the constitution and working of the registered society would include the enquiry into the propriety of continuation by a Working Committee and the need to elect a new committee if the existing working committee functions contrary to the bye-laws of the society. Section 25 (2) (c) should be read so as to include a power in the Registrar to direct the holding of the election to the general body if the occasion demands.
Registrar under the Manipur Societies Registration Act has locus standi to file a Writ Petition challenging election of Managing Committee on behalf of a society though the Regulation of the society empowers secretary to file suit on behalf of the society.[36]
22. Powers of Registrar Do Not Bar Civil Court Jurisdiction
The regulatory powers as to registration of a Society vested with the Registrar do not confer any authority on the Registrar to interfere with the affairs, including the election process, of the Society. The scope of exercising power under Section 4 of the Societies Registration Act is only to the limited extent of examining whether the list furnished is false or bogus. The above referred limited purpose is fulfilled the moment the list is furnished pursuant to an election. If the parties have any grievance against selection, they are free to approach the civil court.[37] When more than one return is filed, the Registrar has got the power to find out as to which one he should accept. There may not be an elaborate enquiry. Prima facie he has to satisfy as to which return is to be accepted. Such an enquiry made by the Registrar and the decision taken from it does not become final. The dispute can be taken up before a competent court as to who are the members of the governing body.[38]
23. Powers of Registrar: Only Enabling Provision
Several State-Societies-Registration-Acts and Amendments to the Societies Registration Act provide for enquiry by Registrar into the constitution, working and financial conditions of the society. In D Dhanapal Vs. D David Livingstone[39] it is held that the suit filed for declaration that the plaintiff continues to be the Secretary of the Society is maintainable. Section 36 of the Tamil Nadu Societies Registration Act does not reveal any express bar to the Civil Courts. Section 36 is merely an enabling provision. If the aggrieved party approaches the Registrar or the Registrar acts on his own motion, then, it shall be lawful for the Registrar to conduct an enquiry and communicate the report of the enquiry. It does not mean to deem it as a bar to the jurisdiction of the Civil Court. There must be at least some implication to show that the Civil Court cannot entertain such suits.
24. Powers of Registrar on Defunct Society: May Cancel Registration
Certain state enactments and state amendments to So. Regn. Act empower the Registrars of Societies to cancel[40] the registration of societies for violation of the provisions under Sec. 4 of the So. Regn. Act.
It is held in CMS Evangelical Suvi David Vs. District Registrar[41] that the intention of the Legislature was not to confer a power of supersession of the Committee on the Registrar as, such power was vested only in the Government;[42] and even when the Registrar was satisfied after enquiry[43] that the society which had contravened any of the provisions of the Act or the Rules made thereunder, or the society was insolvent or the business of any such registered society was conducted fraudulently or not in accordance with the bye-laws or the objects specified in the memorandum filed with the Registrar, he may only cancel the registration.
From the object and scheme of the Societies Registration Acts it is legitimate to state that even if the registration of a society can be cancelled by the Registrar for it becomes defunct[44] the same would not set free the society, once registered, from the provisions as to dissolution in the Societies Registration Act. As per the Societies Registration Act, on dissolution, the left-behind-property of a society goes to another society as determined by the members of the society or by the court (S. 14) for being managed by some other charitable organization and to be utilised for like purposes.[45]
25. No power to Registrar to Direct Fresh Election
It is with Civil Court
Registrar has no jurisdiction to meddle with election disputes.[46] It is also held in CMS Evangelical Suvi David Vs. District Registrar[47] that the power under Sub-Section (9) of Section 36 cannot be stretched to a power on the Registrar to direct the registered society to hold fresh election. A direction to hold fresh election would amount to indirectly setting aside the earlier election and such power is not conferred on the Registrar under any of the provisions of the Act. So long as the election is not declared invalid in the manner known to law, no direction for fresh election could be ordered. Validity of the election could very well be decided only by the competent Civil Court as the parties are entitled to let in their evidence to sustain their respective claims. In the event the Registrar satisfies himself as to the particulars furnished in Form VII as correct, he should enter the names in the register maintained for that purpose. In the event if he does not satisfy as to the particulars and thereby does not accept Form VII, he has to issue a direction relegating the parties to approach the Civil Court for appropriate orders.
26. Effect of Failure to File Documents u/s 4 or of Becoming Defunct
Non-renewal does not infer, society is defunct.
Non-renewal of the registration of a society may be a bar to avail the benefits offered to registered societies, but the same by itself will not lead the inference that the society is not in existence.[48] Burden will be with those who wish to rebut the presumption; and, in any case, such a society can no more be regarded as a registered society.[49]Several State-amendments[50] to the So. Regn. Act, 1860 and State-Societies-Registration-Acts[51] also made specific provisions for imposing fine on the societies (or its office bearers) which make default in complying with the requirements of Sec. 4.
In Nelson Vs. Kallayam Pastorate[52] it is held by Our Apex Court that in the event of becoming a society defunct, or failure to file documents under Sec. 4 of the So. Regn. Act, there is no bar to revive its activities and to conduct the election of the office bearers. It is held in this decision as under:
- “A society need not necessarily be held to have become defunct only because certain statutory provisions have not been complied with by it.”
It was further observed that the courts cannot set aside such elections on the sole ground that certain statutory provisions have not been complied with by it. Right to contest an election of an office-bearer of the society is a statutory right of the member thereof. Such a right also exists under the bye-laws of the society. If a society fails to file with the Registrar the documents required under Sec. 4, a presumption may arise that it is defunct.
But, it was held by our Apex Court in Nand Deo Pandey Vs. Committees of Management[53] that properly constituted committee of management was required to continue the proceedings of inquiry against the Principal of a Vidyalaya. The Managing Committee was held to have ceased to be valid due to non-renewal of the registration of the society and non-holding of periodical elections under the provisions of the Societies’ Registration (U.P. Amendment) Act, 1960. In Parshvanath Jain Temple Vs. LRs. of Prem Dass[54] it was observed by the Rajasthan High Court that irregularity, if any, on account of non-registration of the Trust under the Rajasthan Public Trusts Act at the time of institution of the suit could be cured with the registration of the Trust. It was held that the bar under Section 29 of the Rajasthan Public Trusts Act was only against the hearing and final decision of the suit and not against the institution of the suit itself.
27. States Usually Insist Registration for Its Assistances
Usually, for extending State’s assistances, especially financial, registration of societies under a proper Act is insisted, for it ensures supervision of officials.
[1] NagappaChettiar Vs. Madras Race Club AIR 1951 Mad 831.
Satyavart Sidhantalankar Vs. Arya Samaj: AIR 1946 Bom 516;
Shridhar Misra Vs. Jaihandra: AIR 1959 All 598;
CL Joseph Vs. Jos: AIR 1965 Ker 68;
Star Tiles Works Vs. N. Govindan AIR 1959 Ker 254.
[2] AIR 1962 SC 458
[3] AIR 1958 AP 773
[4] Board of Trustees, Ayurvedic & Unani Tibia College, Delhi Vs.The State: AIR 1962 SC 458. [Dennis Lloyd, ‘Law relating to Unincorporated Associations’ (1938 Edn. at page 59) is quoted.]
[5] Committee of Management Sri JantaAudyogik Vidyalaya Sherpur Gurha Kanpur Vs. Deputy Registrar Firms Societies and Chits Kanpur: ILR 1998 All 38.
[6] Board of Trustees, Ayurvedic&Unani Tibia College, Delhi Vs.The State: AIR 1962 SC 458. [Dennis Lloyd, ‘Law relating to Unincorporated Associations’ (1938 Edn. at page 59) is quoted.]
[7] Board of Trustees, Ayurvedic & Unani Tibia College, Delhi Vs.The State: AIR 1962 SC 458. [Dennis Lloyd, ‘Law relating to Unincorporated Associations’ (1938 Edn. at page 59) is quoted.]
[8] Sec. 6 Societies Registration Act, 1860
[9] Board of Trustees, Ayurvedic & Unani Tibia College, Delhi Vs.The State: AIR 1962 SC 458. Dharam Dutt Vs. Union of India: AIR 2004 SC 1295;
Pamulapati Buchi Naidu College Committee, Nidubrolu Vs. Govt. of AP: AIR 1958 AP 773.
[10] Pamulapati Buchi Naidu College Committee, Nidubrolu Vs. Govt. of AP: AIR 1958 AP 773: Raj Kumar Gaba Vs. State of UP: 2012-49 VST 252;
Commissioner of Income Tax Vs. Merchant Navy Club: 1974-96 ITR 261;
Gurdwara Prabandhak Committee Vs. Jagmonan Singh: ILR 1971-2 Del 515.
[11] Sec. 14
[12] Hindu Public Vs. Rajdhani Puja Samithee: AIR 1999 SC 964
[13] AIR 1980 Pat 138. Referred: Fazlul Rabbi Pradhan Vs. State of West Bengal: AIR 1965 SC 1722.
[14] IV Edn. Vol. 6.
[15] Captain Jagdish Chandra Varshney Vs. Smt. Muni Varshney : AIR 2006 All 347
[16] Executive Committee of Vaish Degree College Vs. Lakshmi Narain: AIR 1976 SC 888.
[17] Daman Singh Vs. State of Punjab and Haryana, AIR 1985 SC 973.
R Jaivel Vs. State of Tamil Nadu: AIR 2006 Mad 215.
State of Punjab Vs. Kesari Chand: AIR 1987 P&H 216;
Sonepat Co Op Sugar Mills Ltd Vs. Presiding Officer Labour Court: AIR 1986 P&H 386;
Mulshanker KunverjiGor Vs. Juvansinhji ShivubhaJadeja: AIR 1980Guj 62.
[18] Ramdass Trust Vs. Damodardas 1967 Raj LW 273;
Sagar Sharma Vs. Additional Commissioner of IT: 2011-239 CTR 169: 2011-336 ITR 611;
Duli Chand Vs. Mahabir Pershad Trilok Chand Charitable Trust: AIR1984 Del 145
Thiagesar Dharma Vanikam Vs. CIT: [1963] 50 ITR 798 (Mad);
Kishorelal Asera Vs. Haji Essa Abba Sait Endts: 2003-3 Mad LW 372: 2003-3 CCC367
Thanthi Trust Vs. Wealth Tax Officer: (1989)78 CTR 54: (1989) 178 ITR 28].
[19] AIR 1964 Ker 118
[20] AP Aboobaker MusaliarVs. Dist. Registrar (G), Kozhikode: (2004) 11 SCC 247.
CMZ Musliar Vs.Aboobacker: ILR 1998-2 Ker 76.
[21] Supreme Court Bar Association Vs. The Registrar of Societies: WP (C) No. 3260/2010 (Delhi High Court), decided on 12.04.2012
[22] Narayanan Vs. District Registrar: ILR 2016-1 Ker 472
[23] Kurian Vs. Joint Registrar: 1990(1) Ker LT 618;
Dipakbhai Prahladbhai Patel Vs. State of Gujarat: 2016 2 GLR 1293.
[24] Umarani Vs. Registrar, Co-operative Societies: (2004) 7 SCC 112.
[25] Virendra Pal Singh Vs. District Assistant Registrar, Co-op Societies: 1980-4 SCC 109.
[26] 2006-2 Cal. LT 17; 2006-4 CHN 321.
[27] Thalappalam Ser. Co-op. Bank Ltd Vs. State of Kerala: 2013 -16 SCC 82; 2013 Sup AIR (SC) 437; 2013 AIR(SC) (CIV) 2758, 2013 AIR(SCW) 5683; 2013 Sup AIR (SC) 437.
[28] 2005-2 Mad LJ 335
[29] M S Evangelical Suvi David Vs. District Registrar: 2005-2 Mad LJ 335
[30] A few States give power, in the So. Reg. Act, to the Government to supersede societies.
[31] AIR 1970 MP 154
[32] AIR 2002 SC 2158
[33] 2006-4 AIR Kar R 218: 2006-4 Kant LJ 526
[34] ILR1993 Kar 2715
[35] 2006-4 AIR Kar R 218: 2006-4 Kant LJ 526
[36] Christian Revival Church Vs. State of Manipur: AIR 2018 (NOC) (Manipur)
[37] Christ Church Mcconaghy School Society, Lucknow Vs. Registrar Firms, Societies And Chits, Lucknow: 2015-5 ADJ 472
[38] C M Z Musliar Vs. Aboobacker: 1998-1 Ker LT–136: ILR 1998-2 Ker 76;
Approved in AP Aboobaker Musaliyar Vs. District Registrar: (2004) 11 SCC 247
[39] 2003-3 Mad LJ 668.
State of Andhra Pradesh Vs.Manjeti Laxmi Kantha Rao: AIR 2000 SC 2220;
PMA Metropolitan Vs. Moran Mar Marthoma: AIR 1995 SC 2001 relied on.
[40] Section 93 of the Multi State Co-operative Societies Act, 2002;
Section 18A of the Rajasthan Societies Registration Act, 1958;
Section 12-D of the Societies Registration Act, 1860 as amended by State of UP;
Section 27 of the Karnataka Societies Registration Act, 1960.
[41] 2005-2 Mad LJ 335
[42] By insertion of Tamil Nadu Act 16 of 1994.
[43] Under Section 36 of the Tamil Nadu Act
[44] Sub-section (2) of Section of M.P. Societies Registrikaran Adhiniyam, 1973 deals with the power of Registrar to dissolve the society if a society has become defunct or has been persistently making default in the observance of the provisions of the Act, or the regulations or byelaws made thereunder.
[45] Board of Trustees, Ayurvedic & Unani Tibia College, Delhi Vs.The State of Delhi: AIR 1962 SC 458: Para 23.
Dadar Ashram Trust Society Vs. Mahathma Gandhi KakshiVidyapeeth: AIR 2017 All. 60
[46] All. Muslim Welfare Society Vs. Asst. Registrar: AIR 1992 All. 43;
All India Council Vs. Asst. Registrar: AIR 1988 All. 236 .
[47] 2005-2 Mad LJ 335
[48] Committee of Management Vs. Commissioner, Kanpur Region: 2008 -1 AWC 695; 2008 -1 ADJ 706; 2008-70 All LR 368.
[49] In Mrigan Maity Vs. Daridra Bandhab Bhandar: 2011-4 Cal LT 226 it is observed that though only a few members of the society have shown any interest in matters pertaining to the society for 36 years or so, it might still not be presumed that the society was defunct that would warrant dissolution under the So. Rgn. Act.
[50] Assam, Orissa, Punjab, Haryana, Delhi, Andhra Pradesh, Himachal Pradesh, Uttar Pradesh, Gujarat, Nagaland, Pondicherry, etc. Maharashtra Amendment to Societies Registration Act, 1860 (Sub Sec. 5 of Sec. 3A) lays down that a society which fails to get its certificate of registration renewed in accordance with this section with one year from the expiration of the period for which the certificate was operative shall become an unregistered society.
[51] Karnataka, MP, Rajasthan, West Bengal, Travancore-Cochin, etc.
[52] AIR 2007 SC 1337. Board of Control for Cricket in India Vs. Netaji Cricket Club [(2005) 4 SCC 741: AIR 2005 SC 592] referred to in this decision.
[53] AIR 1991 SC 413
[54] 2009-3-RCR(CIVIL) 133
