Company Secretaries Regulations, 1982: rr. 92, 117 and 119 – Elections for the office bearers of EIRC – Meeting was required to be chaired by the Chairman, EIRC, however, he was disqualified to hold his office and thus, it fell vacant in terms of r117(2) – It was required to be filled in for the remaining period in terms of Regn 119(2) – Contesting respondent as Vice Chairman of the Institute was allowed to chair the meeting for the limited purpose of election to the post of Chairman for the remaining period in terms of Regn 119(2) – Respondent disrupted the meeting, and for the election of the chairman for the remaining period, the members appointed respondent no. 3 to chair the said item – Elections took place and respondent no. 3 was duly elected as Chairman for the remaining period – High Court quashed the election of the office bearers of the Regional Council on the ground that the meeting was not presided over by the Vice Chairman – On appeal, held: It was a case of vacation of office of the Chairman and not mere absence – Regn
119 states that in case of vacancy of the Chairman, Vice Chairman, Secretary and Treasurer, the Regional Council shall elect another person from amongst its members to hold the office for the remaining period of a year – Regn 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 – Thus, in case of a vacation of office as per Regn 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 – Single Judge as well as the Division Bench of the High Court erred in misinterpreting Regn 92(2) and Regn 117 rw Regn 119(2) – Thus, the election of respondent no. 3 as chairman rightly held and he rightly presided the meeting – High Court erred in quashing and setting aside the election.
Allowing the appeals, the Court
HELD: 1.1 Regulation 117 of the Company Secretaries Regulations, 1982 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 instant 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. [Para 4.2][623-G]
1.2 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 Vice-Chairman, a Secretary and a Treasurer thereof to hold office for a period commencing from the date of its first 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. Thus, as the office of the Chairman fell vacant due to its 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-AK was elected as the Chairman for the remaining period who presided over the meeting dated 27.12.2021. [Para 4.3][624-A-D]
1.3 It was the case on behalf of Respondent no.1 which came to be accepted by the 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), 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 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 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 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 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 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 ChairmanRespondent no.1. [Para 4.4][624-D-H; 625-A-B]
1.4 As regards the submission of the 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, even as per Regulation 114(4), the election can be challenged by the candidate concerned. In the instant 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. [Para 5][625-C-E]
1.5 The impugned judgment and order passed by the Division Bench of the High Court as well as the Single Judge quashing and setting aside the election of the office bearers of the EIRC of the ICSI are quashed and set aside. [Para 6][625-GH]
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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