Election petition cannot determine Rule 23(1)(b) disqualification absent prior determination by competent authority.

The petitioner was elected as a Director of the Patliputra Central Cooperative Bank Limited after the election process concluded and the result was declared on 12 April 2023.

Respondent No. 8 challenged the petitioner’s election through Election Dispute Case No. 56 of 2023, alleging that the petitioner was disqualified as a loan defaulter under Rule 23(1)(b) of the Bihar Cooperative Societies Rules, 1959.

The Joint Registrar, Cooperative Societies, Patna Division, allowed the election dispute on 28 March 2024 and set aside the petitioner’s election.

The petitioner contended that the election petition was not maintainable because the respondent had not first sought a determination of disqualification under Rule 23(1)(b), and that no objection had been raised against his nomination during scrutiny.

He further asserted that the loan had been fully repaid on 18 January 2024.

The respondents argued that the petitioner’s loan account had already been classified as a Non-Performing Asset before nomination and that subsequent repayment could not remove the disqualification existing on the date of nomination.

Whether an election petition could directly challenge the petitioner’s election on the ground of alleged disqualification as a defaulter under Rule 23(1)(b), without a prior determination by the competent authority in a duly constituted proceeding?

Whether the Joint Registrar’s order setting aside the petitioner’s election was legally sustainable in the absence of such prior determination?

Whether the High Court was required to determine, in the writ proceedings, whether the petitioner was in fact a defaulter?

The Court applied Rule 23(1)(b) of the Bihar Cooperative Societies Rules, 1959, concerning disqualification on the ground of default, read with Rules 24 and 25, which operate upon a determination of disqualification.

It relied on Ram Dhyan Yadav v. The State of Bihar & Ors., CWJC No. 10137 of 2015, holding that alleged disqualification must be determined by the appropriate authority in a duly constituted proceeding and cannot ordinarily be adjudicated indirectly through an election dispute.

The Court also followed Laxmi Sahani v. The State of Bihar & Ors., CWJC No. 1616 of 2021, which affirmed that, in the absence of a determination that a candidate was a defaulter, the election challenge could not succeed on that ground.

The Court distinguished the authorities cited by the Bank, including Pundalik v. District Deputy Registrar, 1991 (2) SCC 423, and Md. Shami v. The State of Bihar & Ors., CWJC No. 15229 of 2017, as factually inapplicable.

The Court found that Respondent No. 8 had not invoked the appropriate procedure under Rule 23(1)(b) before filing the election petition; instead, he sought to establish the petitioner’s disqualification directly within the election dispute.

Following Ram Dhyan Yadav and Laxmi Sahani, the Court held that a candidate cannot be removed from an elected office merely on the basis of an unadjudicated allegation of default, because the relevant disqualification must first be determined by the competent authority in a duly constituted proceeding.

Consequently, the Joint Registrar exceeded the permissible scope of the election dispute by deciding the default issue directly.

The Court therefore considered it unnecessary to examine whether the petitioner’s loan account had in fact become an NPA, whether he was a defaulter on the nomination date, or whether subsequent repayment cured the alleged default.

The petitioner was restored, with immediate effect, to the office of Director of the Patliputra Central Cooperative Bank Limited.

The Court expressly left open the question whether the petitioner was a defaulter, observing that the issue could be decided by the competent authority if an appropriate application was filed under Rule 23(1)(b) of the Bihar Cooperative Societies Rules, 1959.