Cooperative Societies Are Bound by RTI Act, Says Bombay HC order
Notwithstanding the myriad opinions and interpretations of several court judgments on whether cooperative societies come under the Right to Information (RTI) Act, a recent landmark judgment of the Aurangabad Bench of the Bombay High Court reiterates that urban cooperative banks, cooperative financial institutions and other cooperative societies are bound by the Act.
 
The Association of Jalgaon Zilla Urban Cooperative Banks, Credit Societies and other financial institutions registered under the Maharashtra Cooperative Societies Act 1960, appealed in a petition to the High Court that cooperative institutions cannot be treated as public authority under the RTI Act. 
 
They contended, “In view of the provisions of Section 2(h) and Section 8 of the Right to Information Act 2005, cooperative institutions registered under the Cooperative Societies Act cannot be treated as public authority.” 
 
They also argued that under banking rules too certain information cannot be disclosed. Their contention was that in view of the provision of section 34A of the Banking 3 WP 1304 of 2008 Regulation Act, 1949, these institutions are not bound to disclose certain information which, according to them, is confidential in nature. 
 
The petitioners also argued that “these institutions are not receiving financial aid from the Government, directly or indirectly, and so the provisions of the Act cannot be made applicable to them”.
 
The petitioners, in their prayer, urged the court to declare cooperative societies and others as “not public authorities” under the RTI Act. Following was their submission:
  • The urban cooperative banks, cooperative financial institutions, Patpedhis (credit cooperative societies) and other cooperative societies, which are registered under the Maharashtra Cooperative Societies Act 1960, are not public authorities within the meaning of Section 2(h) of the Right to Information Act.
  • These institutions stand exempted from disclosure of information u/s 8)1 (d), (e) and (j) of the Right to Information Act
  • That the court issue a writ, order or direction restraining the officers of the cooperative department from supplying any information to the members or general public which is, according to the said societies, confidential in nature.
  • The court, pending the hearing and final decision of the writ petition, restrain the respondent from disclosing any information other than the balance sheet and profit and loss accounts of the cooperative societies, urban banks and Patpedhis to the general public under Right to Information Act. 
 
In its order issued on 13 February 2017, the court observed that cooperative institutions, are registered under the Maharashtra Cooperative Societies Act, 1960 and that cooperative societies and other such institutions are created by a statute; that they have a public authority over them which is the final decision-making body. 
 
Certain Articles of the Constitution also show that such institutions are discharging the duty of the State and there is an ‘authority’ over them, which is the final decision-making body and the co-operatives are bound to supply information (all of which comes under Section 2 (f) of the RTI Act), to this authority. Hence, cooperative societies and other such institutions are bound to supply information under the RTI Act, the HC said.
 
The High Court observed:
  • Cooperative institutions are bodies created by the statute. But right from the registration till the liquidation there is control over these institutions by the authority created under the same Act. The authority steps in to take decisions on the rights of the members. The authority has control over the manner in which funds are invested or over the distribution of the funds. Such institutions cannot act independently and the apex bodies are created for such institutions. 
  • Even Articles 38,39,43 and 48 of the Directive Principles of State Policy of the Constitution show that to some extent such institutions are discharging the duty of the State
  • The provisions of the Maharashtra Cooperative Societies Act show that the authority under the Act can do the audit and inquire into irregularities. If loss is caused to the institution, by the directors, promoters etc., the authority can assess the damage, and the loss caused to the institution can be recovered from those persons. Under the Act, the authority can suspend the managing committee and remove its members. For all these and other purposes mentioned in the Cooperative Societies Act, the cooperative institution is bound to supply the record to the authority.             
  • The provisions of the Maharashtra Cooperative Societies Act, if read with the definition of information given in Section 2(f) of the Act, makes it clear that everything which is mentioned in the definition of information needs to be supplied by the cooperative institution to the authority created under the Cooperative Societies Act. The definition of 'Public Authority' given in Section 2(h) shows that such public authority can be created by any law made by the State Legislature. It is already observed that the officers like Registrar and his subordinate officers are appointed under the Cooperative Societies Act. 
 
The High Court therefore concluded that, “…the reliefs claimed in the present petition cannot be granted as the reliefs can be used 14 WP 1304 of 2008 directly or indirectly by the cooperative institutions to deny the supply of the information... This Court holds that no relief which is claimed in the present petition can be given to the petitioner.”
 
RTI activist Vijay Kumbhar, who has been pursuing this issue for long, says, “After the Supreme Court’s order in Thalappalam Services Cooperfative Bank Ltd. against State of Kerala, public authorities and public information officers (PIOs) said the RTI act was not applicable to cooperative societies. Actually even in the Thalappalam case, the apex court, in paragraph 52 of its judgment, had categorically stated that the PIO of Registrar of Cooperative Societies is duty bound to supply the information. But even then PIOs and cooperative societies were denying the information sought under RTI.”
 
Below is a copy of the order passed by Aurangabad Bench of the Bombay High Court...
 
 
(Vinita Deshmukh is consulting editor of Moneylife, an RTI activist and convener of the Pune Metro Jagruti Abhiyaan. She is the recipient of prestigious awards like the Statesman Award for Rural Reporting, which she won twice in 1998 and 2005, and the Chameli Devi Jain award for outstanding media person for her investigation series on Dow Chemicals. She co-authored the book, “To The Last Bullet - The Inspiring Story of A Braveheart - Ashok Kamte”, with Vinita Kamte, and is the author of “The Mighty Fall”.)   
Comments
Bharat Gandhi
5 years ago
whether the Hon'ble Bombay High Court judgement in case of WP filed by the Association of Jalgaon Zilla Urban Co-op Bank Credit Society IS APPLICABLE TO CO-OP HOUSING SOCIETIES, as per today's newspaper report appeared in the DNA Mumbai edition it is reported that the state CIC has stated that " the order no where state that co-op institutions are public authority and covered under RTI." Furthermore, the former CIC Mr. Shailesh Gandhi opined that "While there could be exceptions when there is a substantial funding or when an administer is running the show at CHS, there are not public authority as yet".
On the other hand activist have different interpretations basis 97th amendment to the Constitution, cooperatives and maintaining that two years down from the line, it will have to be agreed upon with the judgement Shri. Vijay Kumar and RTI activist is of the opinion that 97th amendment to the constitution is clear on that and the interpretation of the order leads to that.
Considering the basis of judgement under consideration, at the moment situation is such that cooperative housing society are not falling directly under RTI Act, but the registrar of CS and its offices are covered under the RTI Act, hence responsible to call for certain information and provide the same to the public who apply to the Registrar and / or Dy. Registrar of their respective area.
Bharat Gandhi
5 years ago
Is cooperative housing society cooperating under the MCS Act, 1960 are covered under RTI Act? Since couple of days on various social WhatsApp groups order of Hon'ble Delhi High Court in case of a Writ Petition No. DHC - WP (C) 6532/2013 (Petitoner Ms. Eliamma Sebastain V/s Ministry of Home Affairs & Ors is being continously circulated stating that basis the Delhi High Court order, all housing societies are covered under RTI Act. In my opinion and by going through the whole order, it is apparent that anyone's such impression is wrong. Gist of the judgement's analysis as under:
The above WP was decided by the Hon’ble Delhi High Court wherein main respondent was Ministry of Home Affairs. In the Hon’ble High Court’s order available, it is not known whether the concerned society was made the respondent, whereas from the record and Advocate for the Ministry of Home Affairs as Respondent No. 1 had appeared. Ongoing through detailed 13 pages order it seems that the petition was NOT AGAINST THE PARTICULAR SOCIETY FOR NOT PROVIDING INFORMATION/ DOCUMENT BUT against SPIO who did not reply to the RTI applications submitted by the WP petitioner.

While analyzing this order one has to bear it in mind that in fundamental the whole case is based on Section 139 of the DCS Act which is different than MCS Act, 1960.

The WP petitioner has filed the first appeal under the RTI Act, as a result the petitioner was to approach DDA for inspection and copies of documents and pay certain charges. Aggrieved by the response from the first appeal order and DDA the petitioner filed an appeal before CIC.

The CIC observed Quote after analyzing the facts and averments made before it through the course of the hearing, the CIC was of the opinion that the appeal was not maintainable due to the provision of DCS Act and that co-operative society are not public authorities to whom the RTI act directly applies. It was observed by the CIC that information held by societies was to be retrieved indirectly from the registrar who was public authority and who under the provision of DCS Act was competent to supply information. Unquote

The CIC held that ……………Quote these appeals are clearly not maintainable because the cooperative societies are not public authorities to whom the RTI Act directly applies. The information held by such societies is to be indirectly accessed under Section 2(f) of the RTI Act through a public authority i.e. the Registrar of cooperative societies…….Unquote

Keeping in view Section 139 of DCS Act (which is not similar or at par to MCS Act, 1960) but Section 2(f) of the RTI Act is similar it is recorded that Quote object of Section 2(f) of RTI Act is to provide information to an applicant. Some information can also be sought from a public authority under the RTI Act. The society in question is a private body and not a public authority as defined under the RTI Act and is not obliged to furnish information. In this case it is the RCS who is the public authority as per Section 2(h) of the RTI Act as well as for the purpose of Section 2(f) would be the public authority from whom information could be accessed with respect to cooperative societies.

The issue whether the WP petitioner could directly seek information from the societies it is observed that the CIC has refused to grant relief on the ground that in case of cooperative societies RTI Act applied indirectly…….. In other words information would be approached by the RCS under Section 139 of DCS Act….with the Registrar of cooperative societies who discharges statutory functions is a ” public authority” . However the grounds of exemption spelt out under the RTI Act too would be attracted, wherever applicable.

Final verdict:
In the light of above findings the application of the petitioner shall be considered by the RCS to extent the information is available with his office. In regard to information not available, the RCS shall indicate clearly what material does not exist, in an order. *It is then open to the petitioner to seek such information under Section 139 of the DCS Act. The Writ Petition is partly allowed in above terms.

Conclusion:

(1) The first Appellant authority and the CIC has opined that cooperative Housing Society is not directly covered under RTI

(2) It is the registrar of DCS Act is the authority undersection 2(f) to provide required information and not the society directly.


(3) The DCS Act Section 139 provides opportunity to a member or any other third person to seek information and documents from society operating under DCS Act.

(4) Apparently MCS Act 1960 is not having any section or provision for a member to obtain information or documents directly from the society operating under Maharashtra. Under the circumstances, the registrar of CS is required to be approached for information or documents from CHS in Maharashtra.
Vinayak Mahamunkar
5 years ago
I agree with the views expressed by shri Gandhi. Many of the hsg. societies are submitting the informations to the Dy. Registrar's Office.
Bharat Gandhi
Replied to Vinayak Mahamunkar comment 5 years ago
Free interpretation of the above judgement.
(1) To understand whether the judgement is directly applicable to any co-op housing society under management control of Dy. Registrar and/ or higher authority, it is essential to read sub Para No. 63, 66, 67, main para 7 to 10 of the judgement.
(2) The judgement in the last para No. 10 has defined public authority and definition of section 2(f) of the RTI Act supra “the definition of “public authority” given in section 2(h) shows that such public authority can be created by any law made by the state legislature. It is already observed that the officers like registrar and its subordinate officers are appointed under the co-op society Act and they have the control over and above said things. In view of these circumstances, the observation made by the apex court in the paragraph already quoted can be used safely when the information is sort from the authority like Registrar or his subordinate officers.
(3) To make the matter clear whether co-op housing society fall directly under RTI Act, the relevant parts of para no. 9 of the judgement reads Quote the provisions of the Maharashtra Co-op Society Act shows that the authority under the Act can ……… for all the above said purposes mentioned in co-op society Act, the co-op institution is bound to supply the record to the authority.
Note: It is too length to reproduce here all 14 pages wherein important observation and definition arrived by the Hon’ble Court is highlighted and underlined. Interested persons to have these all judgement with important paras highlighted, please register your request for the same by providing email ID on this forum, at due course and convenience without any prejudice and/ or any liability/ responsibilities, the highlighted judgement will be mailed.
Gurudutt Mundkur
5 years ago
The need is to differentiate between Co-operative HOUSING societies and other Co-operative societies. In Housing Societies, the admission is limited by the number flats/houses in the Society. Also, each Housing Society has its own Bye-laws within the framework by the Act and the Model Bye-laws. Rules are made by the Members themselves. When you allow Housing Societies to be open to the RTI Act, one needs to know how that information is of interest to the one applying for the information. A Member of a Housing Society is entitled to all information by the Byelaws, but of his own Society, not of any other Housing Society.
Moin Syed
5 years ago
Khumbhar sir..has done a good job by following such crucial and important issue which directly or indirectly affect aam aadmi of this country ...thanks indeed
Bharat Gandhi
5 years ago
Will Mr Vijay Kumbhar , Ms. Deshmukh or the MoneyLife please upload full judgment under reference please ?
Bharat Gandhi
5 years ago
A question being asked " is Co.op. Housing Societies also will be covered by this judgment ?". Its is said that the Managing Committee of any Co.Op., Housing Society ( unless financially funded and supported by government ) is not bound to reply any R T I application! To get any document from the Managing Committee, one has to approach the Dy. Registrar under whose jurisdiction the society operates. On the other hand, I may self has received formal reply frpom Dy. Registrar that " Demanded Documents are not on record of the office as not submitted by the concern society ". In view of the reality and now with the judgment under consideration, is Co.Op., HSG falls under R T I ? Clarification and guidance from the author of the article, Mr Vijay Kumbhar and / or any expert will be appreciated.
Rajesh Nambiar
Replied to Bharat Gandhi comment 5 years ago
Because Managing Committee is not bound to reply they are unaccountable and free to do at will. Even I got a similar reply from the office
Suketu Shah
5 years ago
IMportant for BJP to get clean majority today at BMC elections.The amount of open corruption in housing societies is staggering and goondagiri as well.The cooperative hsg society laws are having looholes good enough for frauds to take advantage.CM is right the coop hsg socety rules themselves have to be changed to start with.
Rajesh Nambiar
Replied to Suketu Shah comment 5 years ago
Agree
Shirish Sadanand Shanbhag
5 years ago
Under 97th Constitutional Amendment, Co-operative Societies are included under Part III of the Constitution, titled, Fundamental Rights under Article 19(1)(c).
Under Part IV of the Constitution, Directive Principles of State Policy, under Article 43-B Promotion of Co-operative Societies.
A separate Part IX-B The Co-operative Societies with 13 articles 243-ZH to 243-ZT were created especially for smooth administration of these Co-operative Societies.
Earlier to 97th Amendment, Co-operative Societies were included only in Seventh Schedule of the Constitution, under item No.32 of List-II State List, under Part XI Relations Between Union and State, in Chapter I Legislative Relations, Article 246.
Item 32 of List-II Incorporation, regulation and winding up of corporation, other than those specified in List I, and universities: unincorporated trading, literary, scientific, religious and other societies and associations: co-operative societies.
Under this entry 32 of State List, legislation can be passed for providing forf nomination by Government of the Chairman and members of the Committee of Management of co-operative societies. It is open to the SAtate to legalislate on any or all aspects of co-operative societies including their management,
Sheetal Prasad Gupta v. State of Bihar, AIR 1990 Pat 81 (FB).
Since under Constitutional 97th amendment, Co-operative Societies are included under Part III and PartIV of the constitution, they are covered under Articles 12 and 36 of the constitution. Both articles are the first articles of respective parts III & IV. In these articles. definition of Government is stated, which is as under.
Article 12 : Unless the context otherwise requires, " "the State" includes the Government and Parliament of India and the Govedrnment and the Legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India.
A comment on this article also reads "Any appointment made by a "State" within the meaning of Article 12 of the Constitution of India must be subject to the constitutional scheme. In making appointments, the State is obliged to comply with the same as also statutory requirements, if any.
Commissioner, Municipal Corporation Hyderabad v. P. Mary Manoranjani
A.I.R. 2008 S.C. 1089.
Therefore, under 97th Constitutional Amendment, as Co-operative Societies are covered under Part II and Part IV of the Constitution of India, they are coming under "State" and therefore, Right to Information Act, 2005 is applicable to them directly.
Earlier, it was indirectly applicable. Anything that we want from any Co-operative Society, we can get it under RTI made to concerned Deputy Registrar, under which said Co-operative Society falls. Even now it is applicable, since Co-operative Society is still under Schedule VII, List-II, Item No.32.
Vijay Kumbhar
Replied to Shirish Sadanand Shanbhag comment 5 years ago
Forming Co Operative society now fundamental right With status of local self Government, under ambit of RTI act https://goo.gl/hUA4sK
Rajesh Nambiar
Replied to Shirish Sadanand Shanbhag comment 5 years ago
Sir how does it hold good in view of this Supreme court order on Co-op Thalappalam Ser.Coop.Bank Ltd.& ... vs State Of Kerala & Ors on 7 October, 2013 https://indiankanoon.org/doc/37517217/
Shirish Sadanand Shanbhag
Replied to Rajesh Nambiar comment 5 years ago
Our aim is to get information from Co-operative Societies under RTI. With this judgment, as given by Moneylife and information given by me, it says that RTI Act is applicable to Co-operative Societies.
Ramesh B Mhadlekar
5 years ago
RBI is hand in gloves with its employees office bearers of RBI [email protected] credit copp Society wherein about 60 to 90 crores of black money has been converted to white money and RBI Governor has failed to take cognisance of the money laundering acts since its top executives are probably involved.The Reserve bank workers organisation a trade union having affiliation to Bhartiya mazdoor sangh had written letters to the Governor to probe the same but Dr. Urjit Patel has maintained a silence in the matter. Possibly protecting the money launderers.
V.s. Joglekar
Replied to Ramesh B Mhadlekar comment 5 years ago
I suppose you are somehow connected with the Staff Society. So am I. Whatever you have written goes beyond the scope or intent of this discussion. Whatever, you have written, assuming to be true within the limitations of your knowledge, why write to the Governor only! Why not to ED? Is it a fear that if proved wrong, you invite prosecution. Organisation in RBI has great brains but does not know how to use them. Perhaps this the reason why its size is shrinking and no one takes them seriously. Wake up, be sensible and don't wash linen, dirty or otherwise public.
V.s. Joglekar
Replied to Ramesh B Mhadlekar comment 5 years ago
I suppose you are somehow connected with the Staff Society. So am I. Whatever you have written goes beyond the scope or intent of this discussion. Whatever, you have written, assuming to be true within the limitations of your knowledge, why write to the Governor only! Why not to ED? Is it a fear that if proved wrong, you invite prosecution. Organisation in RBI has great brains but does not know how to use them. Perhaps this the reason why its size is shrinking and no one takes them seriously. Wake up, be sensible and don't wash linen, dirty or otherwise public.
Rajesh Nambiar
5 years ago
Societies need to be accountable to its members and regulators. Co-operatives run on public money.
SRINIVAS SHENOY
5 years ago
It is a welcome judgement. Finally the members particularly of the cooperative societies, including cooperative banks will be in a position to demand under RTI, the information which was earlier denied to them even by the RBI, particularly with regard to the mismanaged urban cooperative banks.
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