The Supreme Court on Tuesday in a 2:1 majority verdict upheld the validity of the 97th constitutional amendment that deals with issues related to effective management of cooperative societies but struck down a part inserted by it which relates to the Constitution and working of cooperative societies.
The Court was hearing the Centre’s plea challenging the Gujarat High Court’s 2013 decision striking down certain provisions of the 97th constitutional amendment while holding that Parliament cannot enact laws with regard to cooperative societies as it is a State subject.
A 3-judge bench comprising of Justice Rohinton Nariman, Justice KM Joseph and Justice BR Gavai observed,” that there is no overlap whatsoever so far as the subject ‘co-operative societies’ is concerned. Co-operative societies as a subject matter belongs wholly and exclusively to the State legislatures to legislate upon, whereas multi-State cooperative societies i.e., co-operative societies having objects not confined to one state alone, is exclusively within the ken of Parliament. This being the case, it may safely be concluded, on the facts of this case, that there is no overlap and hence, no need to apply the federal supremacy principle as laid down by the judgments of this court. What we are therefore left with is the exclusive power to make laws, so far as co-operative societies are concerned, with the State Legislatures, which is contained in Article 246(3) read with Entry 32 of List II.”
In 2:1 majority verdict in which Justice Rohinton Nariman and Justice BR Gavai struck down only Part IX B introduced by the 97th constitutional amendment to deal with cooperative societies, while Justice KM Joseph struck down the entire amendment.
“We reiterate that our judgment is confined to the procedural aspect of Article 368(2) proviso, there being no substantive challenge to Part IXB on the ground that it violates the basic structure doctrine as laid down in Kesavananda Bharati’s case (supra).” the bench stated.
Further the bench noted that the judgment of the High Court is upheld except to the extent that it strikes down the entirety of Part IXB of the Constitution of India. As held by us above, it is declared that Part IXB of the Constitution of India is operative only insofar as it concerns multi-State cooperative societies both within the various States and in the Union territories of India.