Introduction:

Indira Gandhi Co-Operative Hospital & Others v. Joint Registrar & Another | WP(C) 24928/2025 & WP(C) 46208/2024 | 2025 LiveLaw (Ker) 819:

In a significant ruling impacting the functioning, autonomy, and governance structures of co-operative societies across Kerala, the Kerala High Court recently delivered an authoritative judgment clarifying that co-opted members of a managing committee cannot be removed at the pleasure of the elected board but only through the strict statutory mechanism prescribed under Rule 43-A of the Kerala Co-operative Societies Rules. The matter came before the Court through two connected writ petitions involving the removal of a co-opted Professional Director from the Managing Committee of the Indira Gandhi Co-operative Hospital Society. The controversy arose when, on 10.10.2024, the Board of Directors unanimously resolved to withdraw the co-opted director (Respondent 2) from the committee. Thereafter, the Joint Registrar issued a notice questioning the legality of the removal and ultimately rescinded the Board’s decision under the authority vested in him through Rule 176 of the Rules. Justice K. Babu delivered a common judgment disposing of both petitions, thereby examining fundamental questions concerning the scope of the pleasure doctrine, the legal status of co-opted members, the powers of the managing committee, and the mandatory nature of Rule 43-A for the removal of committee members. This judgment has far-reaching consequences for co-operative governance, reinforcing that statutory safeguards cannot be bypassed through board resolutions or administrative convenience.

Arguments of the Petitioners (Managing Committee):

The petitioners, represented by advocates including Nisha George, Sr. Adv. George Poonthottam, Anshin K.K., and others, asserted that the managing committee possesses inherent autonomy to evaluate the competence, suitability, and performance of co-opted members and to remove them if their continuance is inconsistent with the objectives or effective functioning of the society. They argued that co-opted members do not derive their authority from a democratic mandate of the general body but rather hold their position at the invitation of the elected board, and therefore a co-opted member’s continuation must logically be at the pleasure of the managing committee. By relying on the Supreme Court’s decision in Om Narain Agarwal v. Nagar Palika, Shahjahanpur (1993) 2 SCC 242, the petitioners sought to invoke the principle that certain nominated or co-opted office-bearers, lacking an electoral mandate, may be removed at will by the body that appointed them. They further argued that the governing statutes and by-laws granted sufficient discretion to the managing committee to assess whether a co-opted member continues to contribute effectively to the institutional interests of the society. The petitioners contended that Rule 43-A, which prescribes the no-confidence procedure for removing members of the managing committee, should apply only to elected members given the democratic character and tenure associated with such positions. Co-opted members, it was argued, do not enjoy the same protections because their induction is based on the committee’s internal decision, not on popular vote. Accordingly, they maintained that a simple resolution withdrawing a co-opted member is legally valid. They also contended that the Registrar exceeded his jurisdiction by invoking Rule 176 to rescind a decision that was entirely within the internal administrative domain of the society. According to the petitioners, the Registrar’s intervention amounted to an overreach into the internal functioning of the society and diluted the autonomy guaranteed under the Kerala Co-operative Societies Act. The petitioners emphasised that a co-operative society is a democratic and autonomous institution and that interference with its internal resolutions should be limited to cases of gross illegality or abuse of power, neither of which existed in this case.

Arguments of the Respondents (Joint Registrar and Removed Member):

The respondents, represented by Kaleeswaram Raj and team of counsel, argued that Rule 43-A is explicit, mandatory, and applicable to all members of the committee without distinction between elected and co-opted members. They contended that both the Act and the Rules constitute a complete code governing all aspects of constitution, functioning, and removal of committee members, and hence displacement of any committee member—whether co-opted or elected—must strictly follow the no-confidence procedure prescribed under Rule 43-A. They relied on the Supreme Court’s decision in Bhavnagar University v. Palitana Sugar Mill (P) Ltd. (2003) 2 SCC 111, which held that where a statute provides a specific method of performing an action, such action must be carried out only in that manner. Thus, once the Rules prescribe how members may be removed, no alternative procedure such as a simple resolution is permissible. The respondents also emphasised that the pleasure doctrine invoked by the petitioners has no application in the absence of an express statutory provision permitting removal at will. Since neither the Act nor the Rules contain any clause to that effect, and instead expressly provide a detailed removal procedure, the petitioners’ reliance on Om Narain Agarwal was misplaced. The respondents further argued that the removal resolution was passed without notice, without inclusion of the matter in the agenda, and without giving the member an opportunity of being heard—all of which are mandatory requirements under Rule 43-A. This, they submitted, constituted a blatant violation of principles of natural justice and statutory safeguards. With respect to the Registrar’s intervention, the respondents argued that Rule 176 authorises the Registrar to rescind resolutions of the managing committee where such resolutions contravene the Act, the Rules, or the by-laws. Since the committee’s action clearly violated Rule 43-A, the Registrar’s order was fully justified and legally sustainable.

Court’s Judgment:

The Kerala High Court, after considering the rival submissions and examining the statutory scheme, delivered a reasoned and authoritative judgment holding unequivocally that co-opted members of a managing committee cannot be removed by passing a simple resolution of the elected board and that the only lawful method of removing any member—elected or co-opted—is through the no-confidence procedure prescribed under Rule 43-A of the Kerala Co-operative Societies Rules. The Court observed that the Kerala Co-operative Societies Act and the Rules form a comprehensive and self-contained code governing all aspects of the constitution and functioning of committees. Section 28 provides for constitution of a committee for a fixed term of five years, and Rule 43-A prescribes the detailed mechanism for removal of officers and committee members. The Court stated that the statute does not create any classification between elected and co-opted members for purposes of removal. It emphasised that the pleasure doctrine is applicable only where expressly permitted by statute, and since the Kerala legislation does not contain any such provision, co-opted members enjoy equal statutory protection. The Court rejected the petitioners’ reliance on Om Narain Agarwal, explaining that the case related to a different statutory context and cannot be imported into the domain of co-operative societies governed by a clear and mandatory statutory procedure. Justice K. Babu further held that the managing committee’s action was vitiated by illegality because it was undertaken without notice, without agenda, and without providing the co-opted member an opportunity to defend himself, thereby violating natural justice. The Court strongly reiterated that Rule 43-A prescribes the only valid method for removal, and the mandatory nature of the provision cannot be circumvented by resorting to internal resolutions. The Court also upheld the Registrar’s rescission order under Rule 176, observing that the Registrar was empowered to annul resolutions which contravene statutory provisions. Since the petitioners’ resolution was clearly in violation of Rule 43-A, the Registrar acted well within his statutory mandate in restoring the removed member. Thus, the Court dismissed the writ petitions and permitted the co-opted member to continue as a member of the managing committee, declaring the removal as illegal. The judgment reinforces procedural discipline, statutory compliance, and democratic functioning in co-operative institutions while ensuring protection against arbitrary removal of committee members.