Institute of Company Secretaries of India vs Biman Debnath

Institute of Company Secretaries of India …Appellant

Versus

Biman Debnath & Ors. …Respondents

With

CIVIL APPEAL NOS. 8040­41 OF 2022

Anil Kumar Dubey …Appellant

Versus

Biman Debnath & Ors. …Respondents

JUDGMENT

M.R. SHAH, J.

Signature Not Verified Digitally signed by NIRMALA NEGI Date: 2022.11.07 17:07:09 IST Reason: 1. Feeling aggrieved and dissatisfied with the impugned

judgment and order dated 13.04.2022 passed by the High Court 1 of Judicature at Calcutta in MAT No.213 of 2022 and MAT 219 of

2022 with CAN 1 of 2022 by which the High Court has dismissed

the said appeal and has confirmed the judgment and order

passed by the learned Single Judge by which the learned Single

Judge allowed the writ petition bearing No.WPA 1367 of 2022 by

quashing and setting aside the election of the office bearers of the

Regional Council for the year 2022 held in the 316 th Meeting of

Eastern India Regional Council of the Institute of Company

Secretaries of India, the Institute of Company Secretaries of India

has preferred the present appeal.

2. Notice dated 20.12.2021 was issued for elections to be held

on 27.12.2021 for the Eastern India Regional Council (hereinafter

referred to as ‘EIRC’) of Institute of Company Secretaries of India

(hereinafter referred to as ‘ICSI’) to take effect from 19.01.2022 for

the period of one year. The meeting of the Regional Council was

required to be chaired by the Chairman, EIRC. However, before

the actual date of election on 27.12.2021, the Chairman, EIRC

was disqualified to hold his office on 22.12.2021. Thus, the office

of the Chairman fell vacant in terms of Regulation 117(2) of the

2 Company Secretaries Regulations, 1982 (hereinafter referred to as

“Regulations 1982’). As the post of Chairman fell vacant, the

same was required to be filled in for the remaining period in

terms of Regulation 119(2). The contesting respondent herein as

a Vice Chairman was allowed to chair the meeting for the limited

purpose of election to the post of Chairman for the remaining

period of current year ending on 18.01.2022 in terms of

Regulation 119(2). The contesting respondent no.1 herein as a

Vice­Chairman was allowed to chair the meeting for the limited

purpose of election to the post of Chairman for the remaining

period of the current year ending on 18.01.2022 in terms of

Regulation 119(2). It appears that the contesting respondent no.1

was disrupting the meeting, the remaining members decided to

proceed with the agenda item i.e. electing the chairman for the

remaining period and for that purpose appointed respondent no.3

– Mr. Anil Kumar Dubey to chair the said item. That thereafter

elections took place and the respondent no.3 – Mr. Anil Kumar

Dubey was duly elected as Chairman for the remaining period.

3 2.1 He was elected for the period 19.01.2022 to 18.01.2023.

The Respondent no.1 who did not participate in the election

and/or contest filed the writ petition before the learned Single

Judge contending inter alia that the meeting dated 27.12.2021

chaired by Respondent no.3 was illegal. According to Respondent

no.1, in absence of the Chairman, the Vice­Chairman would

become the Chairman and therefore the meeting was required to

be chaired by him. However, it was the case on behalf of the

Institute and the contesting original respondents that meeting

was convened legally and the Chairman was elected for the

remaining period as per Regulation 119(2) of the Regulations,

1982. It was the specific case on behalf of the contesting original

respondents that it was a case of vacation of office and not the

absence of an office bearer for a particular period of time. The

learned Single Judge allowed the writ petition and set aside the

elections of the office bearers elected in the meeting held on

27.12.2021 mainly on the ground that the meeting was not

chaired by the Vice­Chairman who in absence of the Chairman

was required to conduct and/or chair the meeting as Chairman.

4 The Judgment and Order passed by the learned Single Judge has

been confirmed by the impugned judgment and order of the

Division Bench of the High Court. Hence, the present appeal at

the instance of the ICSI.

3. We have heard Shri Sanjiv Sen, learned Senior Advocate

appearing on behalf of the appellant and Shri Ritin Rai, learned

Senior Advocate appearing on behalf of the contesting respondent

no.1. We have gone through the impugned judgment and order

passed by the learned Single Judge as well as the Division Bench

of the High Court.

4. From the judgment and order passed by the learned Single

Judge confirmed by the Division Bench of the High Court it

appears that the learned Single Judge quashed and set aside the

election of the office bearers of the EIRC on the ground that the

meeting was not presided over by the Vice­Chairman (Respondent

no.1 herein). Therefore, the short question which is posed for

consideration is as to whether the meeting i.e. 21.07.2021 was

presided over by the person duly elected as Chairman for the

remaining period?

5 4.1 While considering the aforesaid issue relevant provisions of

the Regulations 1982 are required to be referred to namely

Regulations 92, 117 & 119 which are as under:

“92. Chairman of the Council.­ At all meetings of the Council, the President, and in his absence the Vice­ President shall be the Chairman; in the absence of both, the members present shall elect one of the their number to be the Chairman of meeting.

Provided that, at the first meeting of any Council the President of the outgoing Council, or in his absence its Vice­President, shall act as the Chairman until such time a President is elected under the provisions of sub­ section (1) of section 12.

Provided further that in the absence of both the President and the Vice president of the outgoing Council the members of the Council present shall elect one of the members to be the Chairman of the meeting until such time a President is elected under the provisions of sub­ section (1) of section 12.”

***

“117. Vacancies.­ (1) A member of a Regional Council may at any time resign his membership by writing under his hand addressed to the Chairman of the Regional Council and the seat of such member shall become vacant when such resignation is notified in the Journal or when the Regional Council next meets, whichever is earlier.

(2) An elected member of a Regional Council who has been found guilty of any professional or other misconduct and awarded penalty of fine or does not attend three consecutive meetings of the Regional

6 Council or Committee thereof, unless he applies for leave of absence in writing and it is granted for each meeting, shall be deemed to have vacated office from the date of the order or at the conclusion of the third meeting unless he applies for leave of absence in writing and it is granted for each meeting.

(3) Any vacancy caused by the resignation, death or removal from the Register of an elected member of the Regional Council may be fi by the Regional Council by co­option of another member entitled to vote in and stand for election to the Regional Council with the approval of the President.

(4) If a member of the Regional Council [including a member of the Council becoming a member of the Regional Council under clause (a) of sub­regulation (2) of Regulation 111] changes his professional address from the regional constituency to which he belonged to at the time of election or co­option, as the case may be, to another regional constituency, such member shall cease to be member of that Regional Council from that date.

The vacancy so caused may be filled by the Regional Council by co­option of another member in the same manner as provided in sub­regulation (3).

(5) In the case of a member of a Regional Council being elected to the Council, without prejudice to his right to be represented on the Regional Council under clause (a) of sub­regulation (2) of Regulation 111, he shall cease to be an elected member of the Regional Council and the vacancy thus caused may be filled up by co­options by the Regional Council in the manner set out in sub­ regulation (3). (6) A co­opted member shall hold office as a member of the Regional Council for the duration of office of that Regional Council.”

***

7 “119. Proceedings of the Regional Council.­ (1) One­ third of the members of the Regional Council for the time being shall constitute the quorum.

(2) Every Regional Council shall at its first meeting held after its constitution and in subsequent years at a meeting to be held in December of every year elect from amongst its members a Chairman, a Vice­Chairman, a Secretary and a Treasurer thereof to hold office for a period commencing from the date of its first meeting after constitution or from 1st January of the subsequent year as the case may be, till the 31st December of that year and so often as any of those offices become vacant, the Regional Council shall elect another person from amongst its members to hold the office for the remaining period of a year.

Provided that the retiring office bearers shall be eligible for re­election to any of the offices of the Regional Council if they continue to be members of the Regional Council.

(3) The first meeting of the Regional Council referred to in sub­regulation

(2) shall be called and held within one month from the date of its constitution 70[* * * * * *].

(4) If within half an hour from the time appointed for the said first meeting of the Regional Council referred to hereinbefore, a quorum as mentioned in sub­regulation (1) above is not present, the said first meeting shall notwithstanding anything contained in that Regulation stand adjourned to the same day in the next week at the same time and place and at such adjourned meeting of the Regional Council, the member or members present, shall constitute the quorum and shall have power to transact all the business which could properly have been transacted at the original meeting.”

8 4.2 Regulation 117 deals with the vacancies. As per Regulation

117(2) an elected member of Regional Council who has been

found guilty of any professional or other misconduct……., shall

be deemed to have vacated office from the date of the order. In

the present case the then Chairman, EIRC was disqualified to

hold his office on 22.12.2021. Therefore, it was a case of vacation

of office of the Chairman.

4.3 Regulation 119 deals with the Proceedings of the Regional

Council. As per Regulation 119(2) every Regional Council shall at

its first meeting held after its constitution and in subsequent

years at a meeting to be held in December of every year elect from

amongst its members a Chairman, a Vice­Chairman, a Secretary

and a Treasurer thereof to hold office for a period commencing

from the date of its first after constitution or from 1 st January of

the subsequent year as the case may be till the 31 st December of

that year and so often as any of those offices become vacant, the

Regional Council shall elect another person from amongst its

members to hold the office for the remaining period of a year.

Thus, as the office of the Chairman fell vacant due to its

9 disqualification any person from amongst its members was

required to be elected as Chairman and/or to hold the office of

the Chairman for the remaining period. Therefore, in exercise of

powers under Regulation 119(2) of the Regulations, 1982,

Respondent No.3 ­ Anil Kumar Dubey was elected as the

Chairman for the remaining period who presided over the meeting

dated 27.12.2021.

4.4 However, it was the case on behalf of Respondent no.1

which came to be accepted by the learned Single Judge and the

Division Bench of the High Court that being a Vice Chairman, a

meeting was required to be chaired/presided over by him in

absence of the Chairman. Heavy reliance was placed on

Regulation 92(2). On fair reading of Regulation 92(2) read with

Regulation 117(2), we are of the opinion that Regulation 92(2)

shall not be applicable at all. Regulation 92(2) shall be applicable

only in a case of absence and not in a case where the post of

Chairman and/or office bearer has fallen vacant. There is a

distinction between the absence and the post fallen vacant.

Regulation 92(2) shall be applicable in a case where the

10 Chairman and/or the office bearer though is not disqualified but

is absent for some reason. Regulation 117(2) shall be applicable

in a case where the elected member of the Regional Council has

been disqualified on he being found guilty of any professional or

other misconduct and awarded penalty of fine. Therefore, in case

of a vacation of office as per Regulation 117(2), such post fallen

vacant is required to be filled in by election by electing another

person from amongst its members to hold the office for the

remaining period of a year (Regulation 119(2)). In that view of the

matter both, the learned Single Judge as well as the Division

Bench of the High Court have seriously erred in misinterpreting

Regulation 92(2) and Regulation 117 read with Regulation 119(2).

Both, the learned Single Judge as well as the Division Bench of

the High Court have not appreciated the distinction between the

vacation of office under Regulation 117(2) of the Regulation and

the absence of an office bearer under Regulation 92. Under the

circumstances both, the learned Single Judge as well as the

Division Bench of the High Court have seriously erred in

quashing and setting aside the election of the office bearers of the

11 EIRC of ICSI held in the meeting held on 27.12.2021 on the

ground that the meeting was not presided over by the Vice

Chairman (Respondent no.1 herein).

5. Now so far as the submission made by Shri Ritin Rai,

learned Senior Advocate appearing on behalf of the contesting

respondent no.1 that even otherwise the election was not held

legally and there was irregularity in conducting the

election/meeting is concerned, at the outset it is required to be

noted that there were disputed questions of fact on whether the

meeting and/or election was irregularly conducted or not. As per

Regulation 114(4) whether any dispute arises regarding any

election to a Regional Council, the matter may be referred by the

candidate concerned within 30 days from the date of the

declaration of the result of the election, to the President and the

decision shall be final. Under the circumstances, in view of

Regulation 114(4) of the Regulations, the High Court ought not to

have entertained the writ petition challenging the validity of the

election. Even otherwise, it is required to be noted that even as

per Regulation 114(4), the election can be challenged by the

12 candidate concerned. In the present case respondent no.1 who

challenged the election of the office bearers did not even contest

the election. Under the circumstances the High Court erred in

entertaining the writ petition challenging the election at the

instance of the respondent no.1 who even did not contest the

election of the office bearers.

6. In view of the above and for the reason stated above present

appeals succeed. The impugned judgment and order passed by

the Division Bench of the High Court as well as the learned Single

Judge quashing and setting aside the election of the office bearers

of the EIRC of the ICSI held on 27.12.2021 are hereby quashed

and set aside. The original writ petitions stand dismissed.

Present appeals are accordingly allowed. No costs.

………………………………….J. [M.R. SHAH]

NEW DELHI; ………………………………….J. NOVEMBER 7, 2022 [M.M. SUNDRESH]

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