GUWAHATI: A judgement by the Gauhati High Court set aside the Annual General Meeting of The Guwahati Cooperative Urban Bank Ltd. held on September 18, 2020, along with the resolutions adopted and the approval given by the Assistant Registrar of Cooperative Societies.
As a result of setting aside the meeting, the previous Board of Directors was dissolved by operation of law, and the Registrar of Cooperative Societies was directed to take the necessary actions to constitute a new Board within 90 days.
The petitioner in the case filed a writ petition challenging the Minutes of the Meeting dated September 18, 2020, and the approval by the Cooperation Department.
As the Board of Directors’ tenure was set to expire in 2020, an Annual General Meeting (AGM) was called for September 11, 2020, but it lacked the required quorum. Following this, it was adjourned to September 18, 2020. However, only 101 out of 426 shareholders were present at the adjourned meeting, and new directors were elected. The Assistant Registrar of Cooperative Societies also approved the meeting.
The petitioner also raised concerns about COVID-19 and restrictions in place during that time, but still, the AGM was held on September 18, 2020. Responding to the concerns of the petitioner, the Cooperation Department and the Police Commissioner reported that the meeting adhered to COVID-19 protocols and no complaints were received regarding violations.
The main issue before the court was whether a quorum is required for meetings adjourned under Section 34(2) of the Assam Cooperative Societies Act, 2007. Section 34(1) of the Act establishes that a minimum quorum of 10% is required, which may be increased by society bylaws but cannot be less than 10%. The meeting was adjourned to a later date under the provisions of Section 34(2).
The court observed that the meeting could not have been held without having the minimum quorum of 10% of the shareholders, but taking into account that only 101 shareholders were present out of 4,265 shareholders, the said meeting held on September 18, 2020, cannot be said to be a meeting of the General Assembly of the Bank.
Consequently, at the said meeting dated September 18, 2020, the resolution so adopted therein as well as the approval so given by the Assistant Registrar of Cooperative Societies were all found to be bad in law and were accordingly set aside and quashed by the court.