The Bombay High Court has held that a Registrar under the Maharashtra Cooperative Societies Act, 1960 lacks the authority to issue a corrigendum that alters the substantive content of approved cooperative bye-laws. The Court emphasized that such an alteration, even if labeled as a clerical correction, amounts to an unauthorized review of a final order and is void ab initio. The operative direction requiring compliance with the corrigendum was set aside as inconsistent with the Appellate Authority’s own legal finding that the corrigendum was issued without jurisdiction.
The Verdict
The petitioner, Pune Urban Cooperative Bank Ltd., won. The Bombay High Court held that the Registrar has no statutory power to issue a corrigendum that changes the substantive content of approved cooperative bye-laws. The Court set aside the Appellate Authority’s direction requiring the Bank to comply with the corrigendum, declaring it ultra vires and legally unsustainable. The corrigendum, which redefined eligibility from "existing and ex-employees" to "existing employees," was held to be a material alteration beyond the Registrar’s authority.
Background & Facts
The petitioner, a registered urban cooperative bank, amended its bye-laws in a Special General Body Meeting on 25 March 2013, following the 97th Constitutional Amendment. The amended bye-laws were submitted to the Registrar of Cooperative Societies for approval. On 19 December 2013, the Registrar approved the amendments with retrospective effect from the same date.
On 12 March 2014, a member of the Bank, respondent No.4, filed a complaint alleging that the approval process violated natural justice, as he was not heard. On the same day, without initiating any formal review or hearing, the Registrar issued a corrigendum altering the phrase "existing and ex-employees" to "existing employees" in the approved bye-laws. This change excluded former employees from certain benefits, significantly affecting their rights.
The Bank challenged the corrigendum before the Appellate Authority, arguing that the Registrar had no power to modify substantive provisions post-approval. The Appellate Authority agreed that the Registrar lacked jurisdiction to issue such a corrigendum, as the Maharashtra Cooperative Societies Act, 1960, does not empower the Registrar to review or amend approved bye-laws. Despite this finding, the Appellate Authority’s operative order directed the Bank to implement the corrigendum. The Bank then filed this writ petition challenging that directive as contradictory and legally impermissible.
The Legal Issue
Can a Registrar under the Maharashtra Cooperative Societies Act, 1960, issue a corrigendum that alters the substantive scope of an approved bye-law, and if so, does such an alteration constitute a valid exercise of power or an unauthorized review?
Arguments Presented
For the Petitioner
The petitioner argued that Section 13 of the Maharashtra Cooperative Societies Act, 1960, grants the Registrar only the power to approve or reject bye-laws submitted by cooperative societies. It does not confer any power to review, modify, or correct approved bye-laws after issuance. The corrigendum changed the class of persons eligible for benefits - from "existing and ex-employees" to "existing employees" - which is a substantive alteration affecting rights and obligations. Such a change cannot be classified as a clerical or typographical error. The petitioner cited the principle that administrative authorities cannot act beyond their statutory mandate, and any such action is void under the doctrine of ultra vires.
For the Respondent
The Respondent State did not contest the legal position that the Registrar lacked express power to issue a corrigendum. However, it argued that the change was merely a clarification of intent and did not alter the substance of the bye-law. It contended that the Appellate Authority’s direction to comply with the corrigendum was a pragmatic measure to maintain administrative continuity and avoid disruption to the Bank’s operations. The Respondent relied on the principle of administrative convenience, suggesting that technical invalidity should not override practical outcomes.
The Court's Analysis
The Court began by examining the statutory framework under Section 13 of the Maharashtra Cooperative Societies Act, 1960. It noted that the Act provides a clear and exhaustive procedure for the approval of bye-laws. Once approved, the bye-laws become binding on the society and its members. The Court held that the power to approve is distinct from the power to amend or review. No provision in the Act permits the Registrar to revisit or modify an approved bye-law after issuance.
"A change that alters the substantive content of a bye-law amounts to review. It is not a simple clerical correction."
The Court rejected the Respondent’s argument that the corrigendum was merely a clarification. The substitution of "existing and ex-employees" with "existing employees" eliminated a distinct category of persons from entitlements. This was not a typographical error or a misstatement but a material narrowing of rights. The Court emphasized that even if the Registrar’s intent was benign, the absence of statutory authority rendered the corrigendum legally void.
The Court further held that the Appellate Authority’s direction to comply with the corrigendum was legally incoherent. Having found that the corrigendum was issued without jurisdiction, the Appellate Authority could not, consistent with its own reasoning, direct compliance with it. The Court cited the foundational principle that administrative decisions must be internally consistent: an authority cannot simultaneously declare an act ultra vires and then enforce it.
"Courts and authorities cannot issue operative directions contrary to their own reasoning."
The Court concluded that the Appellate Authority’s Clause (2) was not merely erroneous but jurisdictionally defective. It had no legal basis to impose an obligation derived from an invalid instrument.
What This Means For Similar Cases
This judgment establishes a clear precedent that any post-approval modification of cooperative bye-laws by a Registrar - whether labeled as a corrigendum, clarification, or rectification - is ultra vires if it alters substantive rights or obligations. Practitioners must now treat approved bye-laws as final and binding unless amended through the formal process prescribed under the Act, typically requiring a fresh resolution by the general body and re-submission for approval.
The ruling reinforces the doctrine of ultra vires in administrative law, particularly in the cooperative sector. It curbs arbitrary administrative interventions and protects members’ rights derived from formally approved governance documents. Future challenges to similar corrigenda in cooperative societies will now have strong precedent to rely upon.
This decision does not prevent correction of clerical or arithmetical errors. However, any change affecting eligibility, voting rights, financial obligations, or governance structure must follow the statutory amendment process. Practitioners advising cooperative societies should ensure that any proposed changes are formally submitted for approval rather than relying on informal corrections.
