K. v. Sundaram and another VS Raj Rajeshwari co-op. Housing Society Ltd. and others
1979-10-07
D.B.DESHPANDE, M.N.CHANDURKAR
body1979
DigiLaw.ai
JUDGMENT - CHANDURKAR M.N., J.: - Petitioner No.1 is a member of Raj Rajeshwari Cooperative Housing Society Limited respondent No.1(hereinafter referred to as the Society). Petitioner No.1 was allotted Flat No. ,0 in the building owned by the Society at Chembur consisting of 15 flats.. Petitioner No.2 is the father of petitioner No.1 and is also a member of the Society being a joint holder of share issued by the Society in respect of the membership of petitioner No. 1. A resolution expelling petitioner No. 1 from the Society was passed at a special general body meeting of the Society held on 10th December 1972. We are not concerned in this petition with the events which, according to the petitioners, led to the passing of the resolution of expulsion. It will, however, suffice to state that the case of the Society is that the petitioner No.1 is not in occupation of the flat which was allotted to him and he, therefore, did not need the flat. The Society wanted to allot the said flat to one M. S. Balsubramaniam who had started a dispute under section 91 of the Maharashtra Co-operative Societies Act(hereinafter referred to as the Act), which is pending. In that dispute, Balsubramaniam had prayed for an order that the petitioner No. 1 should hand over vacant possession of the flat 0 to the Society in order to enable the Society to allot the same to the said Balsubramaniam, the Society at its meeting, dated 8th August 1971, had accepted Balsubramaniam as a member of the Society. By a separate resolution passed on that day, it was noted that the flat allotted to petitioner No. 1 Was not occupied by him or his family members and that the flat was leased out. By another resolution on the same day, it was noted that Balsubramaniam had agreed to offer a reasonable price to petitioner No. 1 for fiat 0 but the petitioner No. 1 had declined the said offer. It was also noted that till the dispute ABN /694 initiated by Balsubramaniam under section 91 was resolved or finally disposed of, “the Society shall not sanction or furnish transfer of the said flat 0 to any other person than Shri R. S. Balsubramaniam.
It was also noted that till the dispute ABN /694 initiated by Balsubramaniam under section 91 was resolved or finally disposed of, “the Society shall not sanction or furnish transfer of the said flat 0 to any other person than Shri R. S. Balsubramaniam. The Society had also served a notice on 17th December 1971 under section 35 of the Act read with rules 28 and 29 of the Maharashtra Co-operative Societies Rules, 1961 (hereinafter referred to as the Rules). The petitioner No. 1 was informed by that letter that since he had parted with possession of the said flat, the Society was put to heavy additional tax burden, that petitioner No. 1 was a persistent defaulter and that petitioner No. 1 had brought disrepute to the interest and proper working of the Society and had violated provisions of by-law 12(1), (a), (b), (e), (f) and(g). Petitioner No.1 was intimated that the general body meeting will be held on 23-1-1972 and petitioner No. 1 was called upon to give explanation against the said charge. 2. After the receipt of this notice, petitioner No.1 submitted the dispute under section 91 of the Act in December 1971, in which proceedings of the Special General Meeting held on 8th August 1971, were sought to be declared as bad in law. The Notice, dated 17-12-1971 was also sought to be declared as bad in law, mala fide and void. During the pendency of this dispute, it appears that as a result of an adinterim injunction granted by the Officer on Special Duty, the meeting which was scheduled to be held on 31- 12-1971 was not held. The injunction, however, was vacated by the Maharashtra State Co operative Tribunal on 8th February 1972. Finally, a Special General Body Meeting of the Society came to be held on 10-12-1972 which came to be adjourned to 17-12-1972, at which the resolution of expulsion of petitioner No.1 was passed. Petitioner No.1 then amended his original claim made in the proceedings before the Officer on Special Duty and asked for a declaration that the resolution passed at the Special General Body Meeting on 17th December 1972, should be declared illegal and void. 3. The Society had also filed an application under section 35 of the Act for according approval to the resolution, dated 17-12-1972 expelling petitioner No.1 from the membership of the said Society.
3. The Society had also filed an application under section 35 of the Act for according approval to the resolution, dated 17-12-1972 expelling petitioner No.1 from the membership of the said Society. That application was being dealt with by the Assistant Registrar, Co-operative Societies, Bombay. 4. The Officer on Special Duty made an order on 15-10-1971 that petitioner No. 1 cannot be allowed in the proceedings under section 91 of the Act to challenge the resolution of expulsion and by that order, he restricted the scope of the proceedings before him only to the reliefs other than the relief against the resolution of expulsion. He then restricted the inquiry in respect of relief not connected with the relief against expulsion and directed the dispute to be proceeded with to that extent. Petitioner No.1 had also made an application to the Assistant Registrar, requesting him to stay the proceedings for according approval to the resolution, dated 17-12.1972 on the ground that the dispute pending before the Officer on Special Duty is an earlier proceedings and that the proceeding started later viz. that started by the Society for approval to the resolution of expulsion be stayed under section 10 of the Code of Civil Procedure The Assistant Collector held that section 10 of the Code of Civil Procedure did not apply and, therefore, he rejected the request for stay and directed petitioner No. 1 to file a reply if he wanted to file one. 5. Petitioner No.1 has, now in this petition, challenged these two orders, one made by Officer on Special Duty deciding to proceed with the dispute under section 91 to the limited extent indicated by him in his order, dated 15-10-1974 which clearly ruled out any inquiry relating to the validity or otherwise of the expulsion and the other made by the Assistant Registrar ,deciding to proceed with the application made by the Society for approval to the resolution, dated 17-12-1972. 6. As already pointed out, we are not concerned with the truth or otherwise of the facts on which the resolution of expulsion has been passed by the Society.
6. As already pointed out, we are not concerned with the truth or otherwise of the facts on which the resolution of expulsion has been passed by the Society. The resolution, however, recounts that petitioner No.1 had not replied to the various charges levelled against him in the notice, dated 28-9 1971 and subsequent communication, dated 30th October 1972 and 30th November 1972; that petitioner No. 1 had parted with the possession of flat 0 in utter disregard of the order of the Officer on Special Duty in case ABN/K/694 to Shri G. R. Rao without the permission of the Society from November 1969 and prior to that to Shri G. Mallikarjunan from May 1969 and that this has resulted in the imposition of additional Municipal Tax and the discontinuance of benefit of 30% rebates in the General Tax till then enjoyed by all the members of the Society; and that the actions of petitioner No. 1 have resulted in additional expenses to the Society. The substantive resolution reads as follows: “This meeting, therefore, resolves that Shri K.V. Sundaram be hereby expelled from the membership of the Society and that his shares in the society be and are hereby forfeited and that further proceedings be initiated to obtain the free and vacant possession of flat 0 in the Societys building Rajeshwari on Flat No 36, 17th Road, Chembur, Bombay 71 and also for recovery of all expenses and compensation from Shri K. V. Sundaram.” 7. The only question Which has been raised in this petition is With regard to the jurisdiction of the Officer on Special Duty under section 91 of the Act and the only question which has to be decided is whether having regard to the provisions of section 35 of the Act, a dispute challenging the resolution of expulsion can be the subject-matter of a proceeding under section 91. Before we notice the argument advanced on behalf of the petitioners, it is necessary to refer to the relevant provisions of the Act and Rules. We may here point out that respondent No.1 Society was not represented before us and as no counsel appeared for the Society, we requested Mr. N. S. Shastri to appear Amicus Curiae and to give us such assistance as is possible.” 8.
We may here point out that respondent No.1 Society was not represented before us and as no counsel appeared for the Society, we requested Mr. N. S. Shastri to appear Amicus Curiae and to give us such assistance as is possible.” 8. Expulsion of a member of a Co-operative Society is expressly deal with by section 35 or the Act, which reads as follows : Expulsion of members “A society may, by resolution passed by a: majority of not less than three-fourths of the members entitled to vote who are present at a general meeting held for the purpose, expel a member for acts which are detrimental to the interest or proper working of the society; Provided that, no resolution will be valid, unless the member concerned is given an opportunity of representing his case to the general body and no resolution shall be effective unless it is approved by the Registrar. (2) No member of a society, who has been expelled under the foregoing sub-section shall be eligible for read mission as a member of that society, or for admission as a member of any other society, for a period of one year from the date of such expulsion; Provided that, the Registrar may, on an application by the society and in special circumstances, sanction the re admission or admission within the said period of any such member as a member of the said society or of any other society, as the case may be”. 9. Rules have been framed in the matter dealing with expulsion of members. They are rules 28 and 29. Rule 28 provides for the grounds on which a member can be expelled from membership of a Society. Rule 28 reads as follows: “Expulsion of members: - Any member who has been persistently defaulting payment of his dues or has been failing to comply with the provisions of the by-laws regarding sales of his product through the society or, other matters in connection with his dealings with the society or who in the opinion of the committee has brought disrepute to the society or has done other acts detrimental to the interest or proper working of the society may, in accordance with the provisions of sub-section(1) of section 35, he expelled from the society. Expulsion from membership may involve forfeiture of shares held by the member”.
Expulsion from membership may involve forfeiture of shares held by the member”. Rule 29 prescribes the procedure which is required to be followed before a resolution for expulsion is taken up for consideration and put before the General Body of members. Provision of section 35 of the Act read with rules 28 and 29 of the Rules thus form a self-contained Code relating to the expulsion of a member Under the substantive provisions of section 35, a Society is entitled to expel a member for acts which are detrimental to the interest or proper working of the Society, but this has to be done by a resolution passed by the majority of not less than three-fourths of the members entitled to vote and who are present at the general meeting held for that purpose. The proviso to section 35(1) provides that: “No resolution shall be valid, unless the member concerned is given an opportunity of representing his case to the general body no resolution shall be effective unless it is approved by the Registrar.” The proviso is thus in two parts. First part deals with the validity of the resolution of expulsion and it gives effect to the principles of natural justice that a person must be heard before he is expelled from the Society. It, therefore, provides that a resolution of expulsion shall not be valid unless the member concerned is given an opportunity of representing his case to the General Body. Under the second part of the Proviso, the resolution so passed does not become operative or effective merely because the resolution has been passed by the General Meeting. The pre-condition of its effectiveness is that the resolution has to be approved by the Registrar. We are not concerned in this case with sub-section(2). Rule 28, which has been reproduced above, gives grounds on which a person may be expelled from membership of a Co-operative Society. It also sets out consequences of such expulsion by providing that expulsion from membership may involve forfeiture of shares held by the member. Rule 29(1) provides for the procedure for expulsion of members and is intended to work out the first part of proviso to section 35(1) of the Act.
It also sets out consequences of such expulsion by providing that expulsion from membership may involve forfeiture of shares held by the member. Rule 29(1) provides for the procedure for expulsion of members and is intended to work out the first part of proviso to section 35(1) of the Act. It provides that where any member of a society proposes to bring a resolution for - expulsion of any other member a written notice of the resolution must be given to the Chairman of the Society and on receipt of such notice or when the committee decides to bring in such a resolution, the consideration of such a resolution shall be included in the agenda for the next general meeting. Rule(1) also requires a notice of the resolution to be given to the member against whom such a resolution is proposed to be brought. The notice must call upon the member concerned to be present at the General Meeting which cannot be held earlier than a period of one month from the date of the notice and the member has to be caused upon to show cause against the expulsion to the general body of members. It is only after this procedure has been followed and after hearing the member if he is present or after taking into consideration any written representation, which be might have sent, that the General Body can proceed to consider the resolution. 10. Sub-rule 2 of Rule 29 is intended to work out the latter part of the proviso to section 35(1) of the Act and it provides how the Registrar has to proceed when his approval to the resolution of expulsion is sought. The Registrar is required, under the rule, to consider the resolution and make such inquiries as he may deem fit and then give his approval and communicate the same to the Society and the member concerned. The rule also provides that the resolution becomes effective only from the date of such approval. 11. Now, the decision under section 35 of the Act is made appealable under section 152 of the Act. Section 152 occurs in Chapter 13 of the Act, which deals with Appeals, Review and Revision. An appeal is provided against an order or decision under certain provisions of the Act and section 35 is one of them.
11. Now, the decision under section 35 of the Act is made appealable under section 152 of the Act. Section 152 occurs in Chapter 13 of the Act, which deals with Appeals, Review and Revision. An appeal is provided against an order or decision under certain provisions of the Act and section 35 is one of them. If the impugned order or decision under the provisions mentioned III section 152(1) is made or sanctioned or approved by the Registrar, or Additional or Joint Registrar on whom powers of the Registrar are conferred, an appeal lies to the State Government and if an order or decision impugned is made or sanctioned by a person other than the Registrar, or the Additional or Joint Registrar on whom the power of the Registrar are conferred, an appeal lies to the Registrar. Section 152(2) refers to order against which appeal lies to the Co-operative Appellate Court. Section 152(4) which gives finality to the order or decision or award under the Act reads as follows: “Save as expressly provided, no appeal shall lie against any order, decision or award passed in accordance with the provisions of this Act; and every such order, decision or award shall, whether expressly provided or not, be final, but shall always be subject to the provisions for revision in this Act; and where an appeal has been provided for, any order passed on appeal shall likewise be final, but be subject to such revision provisions.” 12. The revisional jurisdiction is vested under the Act in three Authorities. One of the Authorities under the Act is the Co-operative Appellate Court in whom has been vested the revisional jurisdiction under section 149(9) of the Act over the orders or decisions from which the appeal lies to that Court. We shall refer to this provision later. The other two Authorities under the Act in whom the revisional jurisdiction is vested are the State Government and the Registrar. This revisional jurisdiction is vested under section 154 of the Act. Revisional jurisdiction under section 154 can be exercised either by the State Government or Registrar in cases which are not covered by section 149(9) which deals With the revisional jurisdiction of the Co-operative Appellate Court. 13.
This revisional jurisdiction is vested under section 154 of the Act. Revisional jurisdiction under section 154 can be exercised either by the State Government or Registrar in cases which are not covered by section 149(9) which deals With the revisional jurisdiction of the Co-operative Appellate Court. 13. So far as the present dispute is concerned, it can hardly be disputed that the order made in appeal against the decision of the Registrar or Additional or Joint Registrar, can be subject-matter of revision under section 154 of the Act. This is so far as appellate and revisional jurisdiction in respect of orders made under section 35 of the Act is concerned. 14. Now, the other relevant provision is section 91 of the Act which provides for a dispute being referred to the Registrar, if both the parties to the dispute are one or other of those mentioned in clauses(a), (b), (c), (d), (e) in section 91(1). Relevant portion of section 91(1) reads as follows:- “Notwithstanding anything contained in any other law for the time being in force, any dispute touching the constitution, elections of the office-bearers, conduct of general meetings, management or business of a society shall be referred by any of the parties to the dispute, or by a federal society to which the society is affiliated, or by a creditor of the society to the Registrar, if both the parties thereto are one or other of the following”. 15. It is well known that these disputes are now referred to the Co-operative Courts which are now constituted under section 91(A) of the Act. The award made by the Co-operative Court or Registrar is made under section 96 of the Act. Section 97 then provides for an appeal to the Co-operative Appellate Court. Section 97 provides as follows : “Any party aggrieved by any decision of the Registrar or the Cooperative Court under the last preceding section, or an order passed under section 95 may, within two months from the date of the decision or order, appeal to the Co-operative. Appellate Court”.
Section 97 provides as follows : “Any party aggrieved by any decision of the Registrar or the Cooperative Court under the last preceding section, or an order passed under section 95 may, within two months from the date of the decision or order, appeal to the Co-operative. Appellate Court”. The powers of the Appellate Court are given in section 149 and its revisional powers contained in section 149(9) which reads as follows: “(9) The Co-operative Appellate Court may call for and examine the record of any proceeding in which appeal lies to it, for purpose of satisfying itself as to the legality or propriety of any decision or order passed. If in any case, it appears to the Co-operative Appellate Court that any such decision or order should be modified, annulled or reversed, the Co-operative Appellate Court may pass such order thereon as it may deem just.” Under section 149(11), orders made by the Co-operative Court are made final and conclusive and cannot be called in question in any Civil or Revenue Court. This provision reads as follows : “An order passed in appeal, or in revision under sub-section(9), or in review under Section 150 by the Co-operative Appellate Court, shall be final and conclusive, and shall not be called in question in any Civil or Revenue Court”. The only other provision which now needs to be noticed is section 163. Section 163 of the Act bars jurisdiction of the Civil and Revenue Courts in respect of certain matters. That provision reads as follows :- “163(1) Save as expressly provided in this Act, no Civil or Revenue Court shall have any jurisdiction in respect of:- (a) the registration of a society or its by-laws, or the amendment of its by-laws, or the dissolution of the committee of a society, or the management of the society on dissolution thereof, or (b) any dispute required to be referred to the Registrar, or the Co-operative Court, for decision; (c) any matter concerned with the winding up and dissolution of a society. (2) While a society is being wound up, no suit or other legal proceeding relating to the business of such society shall be proceeded with or instituted against the society or any member thereof, or any matter touching the affairs of the society, except by leave of the Registrar, and subject to such terms as he may impose.
(2) While a society is being wound up, no suit or other legal proceeding relating to the business of such society shall be proceeded with or instituted against the society or any member thereof, or any matter touching the affairs of the society, except by leave of the Registrar, and subject to such terms as he may impose. (3) All orders, decisions or awards passed in accordance with this Act or the rules, shall, subject to the provisions for appeal or revision in this Act be final; and no such order, decision or award shall be liable to be challenged, set aside, modified, revised or declared void in any Court upon the merits, or upon any other ground whatsoever”. For our purposes, the only relevant provision is section 163(3) under which all orders, decisions or award passed in accordance with this Act or the rules have been given finality subject to the provisions of appeal or revision; and such order, decision or award cannot be challenged, set-aside, modified, revised or declared void in any Court upon the merits or upon any grounds whatsoever. 16. Having thus referred to the relevant provisions it is now convenient to refer to the contentions raised on behalf of the Petitioners by Mr. Deodhar. Mr. Deodhar contended that section 91 provides for a forum which is a substitute for a Civil Court and, therefore, section 91 contemplates that the civil rights which a member of the Society may have and which could have been agitated in a Civil Court are now to be agitated in a special forum created under section 91. Therefore, according to the learned counsel, a resolution, which has the effect of expelling a member from the membership of the Society with further drastic consequences of the member being deprive a of the premises allotted to him in the case of a Housing Society, can only be challenged in the forum created by section 91. It is then contended that section 9\ does not contain any words of exclusion excluding the dispute with regard to the validity of a resolution of expulsion from the purview of that provision. Mr.
It is then contended that section 9\ does not contain any words of exclusion excluding the dispute with regard to the validity of a resolution of expulsion from the purview of that provision. Mr. Shastri has, however, argued that so far as the resolution of expulsion of a member is concerned, the only provision which can be availed of is section 35 and if a member is aggrieved by the decision of the Registrar approving the resolution, then the person aggrieved must go in appeal under section 152 and if necessary file a further revision application under section 154. He pointed out that the orders made under section 35 as confirmed or modified under section 152 or 154 as the case may be, have been given finality under section 163(3) of the Act and since these orders are intended to become final, their validity cannot be put to test or scrutiny again in a proceeding under section 91. 17. The question which, therefore, falls for consideration is whether it will be permissible for the Officer on Special Duty or the Co operative Court dealing with a dispute under section 91, to deal with the validity of the resolution of expulsion made under section 35 of the Act. Now, there can be no doubt that a dispute, arising out of a resolution of expulsion of a member is a dispute touching the constitution of the society and on the plain grammatical construction of the words in section 91, such a dispute would squarely fail within the scope of section 91, unless there is some other provision in the Act which has the effect of excluding this particular dispute from the very wide scope of the provisions of section 91. The effect of non obstante clause in section 91 is that the jurisdiction of the Civil Court in respect of the disputes referred to therein is taken away. In other words, a Civil Court has no jurisdiction to deal with the dispute which can be taken under section 91 to the Registrar or the Co-operative Court.
The effect of non obstante clause in section 91 is that the jurisdiction of the Civil Court in respect of the disputes referred to therein is taken away. In other words, a Civil Court has no jurisdiction to deal with the dispute which can be taken under section 91 to the Registrar or the Co-operative Court. The question which is posed before us cannot be answered merely on the footing that because the right to membership of the Society could have been enforced or a validity of the decision taking away that right could have been tested by a suit in a Civil Court, the same relief could now be asked under section 91, because the forum Created by section 91 is only a substitute for the forum of the Civil Court under the general law. What we must find out is what is the effect of several other provisions under the Act which specifically and in particular deal with the expulsion of a member. Section 35 of the Act, which we have referred to earlier, provides that no resolution shall be effective unless it is approved by the Registrar. In other words, even if a resolution of expulsion has been passed by a Co-operative Society, mere passing of the resolution does not have the immediate effect of expelling that member. The resolution becomes operative only if it is approved by the Registrar. Therefore, till the Registrar puts his seal of approval on the resolution, the rights of a member are not, in any way, affected. Now Rule 29 provides for an inquiry which the Registrar is required to make. It is true that the rule merely provides that he may make such inquiry as he may deem fit. On the face of it, the rule appears to provide for a summary inquiry. But, however, summary may be the nature of the inquiry, it is obvious having regard to the consequences which follow the decision of the Registrar to approve the resolution of expulsion that the Registrar will have to hear the person sought to be expelled. A decision to approve the resolution of expulsion cannot be taken by the Registrar unless in the inquiry which he is required to make, he gives a notice to the person sought to be expelled and gives him a hearing as to why the resolution of expulsion should not be approved.
A decision to approve the resolution of expulsion cannot be taken by the Registrar unless in the inquiry which he is required to make, he gives a notice to the person sought to be expelled and gives him a hearing as to why the resolution of expulsion should not be approved. The decision contemplated by section 35 is not a mere mechanical and idle formality. The scope of such an inquiry cannot be restricted to the mere formality of going into the question whether the resolution, in fact, has been passed or not. The Registrar is bound to apply his mind to the questions relating to the merits of the case alleged against the member and thus go into the question of the validity of the resolution. If it is possible for the member concerned to show to the Registrar that the resolution is invalid in law, then the Registrar will be justified in declining to accord his approval to the resolution. Therefore, notwithstanding the fact that the Society has passed a resolution of expulsion, the validity of such a resolution can always be adjudicated upon by the Registrar in the inquiry made under section 35. The scope of an inquiry under section 35, was considered by the Division Bench of this Court in (Vishwajit Co-operative Housing Society v. P. P. Damlel)1. In that case, the General Body of a Co-operative Society at a special General Body Meeting bad passed a resolution of expulsion against a member. A notice, calling upon the member concerned to give his explanation, was served on the member on 8th October 1971. The member concerned gave his reply on 3-11-1971. A notice of the General Body Meeting to be held on 14-11-1971, was then circulated on 28th October 1971 and at that meeting of 14-11-1971 it was resolved that the member should be expelled from the Society. The Assistant Registrar, after hearing both the parties, gave the approval to the action of the Society. An appeal against the order of the Assistant Registrar was dismissed by the Divisional Joint Registrar and the member concerned then went in revision to the State Government.
The Assistant Registrar, after hearing both the parties, gave the approval to the action of the Society. An appeal against the order of the Assistant Registrar was dismissed by the Divisional Joint Registrar and the member concerned then went in revision to the State Government. The State Government, in exercise of its revisional jurisdiction, took the view that the appeal circulated by the member concerned to other members, could not be said to be detrimental to the proper and smooth working of the Society and that it could not be said to be injurious to the credit of the society or to any of its member. Consequently, the State Government held that the society bad taken a high handed action and further held that the authorities should have gone into the merits instead of merely noting that formalities of passing a resolution expelling the member concerned, were satisfied. This order of the State Government was challenged by the Petitioner under Article 227 of the Constitution of India. It was contended on behalf of the society before this Court that the revision authority under section 154 of the Act has no powers to set aside the approval given by the authorities below on the ground that they had not gone into the merits of the case, because, according to the learned counsel, all that the lower authorities could do was to find out whether the necessary formalities were observed by the Society before passing the resolution and that having been done by them, they were justified in giving the approval. The question which the Division Bench was required to consider was whether the Registrar of Co-operative Societies, while giving approval to a resolution passed by a society under section 35 of the Act, can go into the merits of a particular case of removal of a member. The Division Bench held that the Registrar is expected to give approval to a resolution passed by a Society under section 35(1) of the Act, surety he was not only simply to look at the formalities but also to consider the merits of the case against the member sought to be removed under the resolution passed by the Society. 18.
The Division Bench held that the Registrar is expected to give approval to a resolution passed by a Society under section 35(1) of the Act, surety he was not only simply to look at the formalities but also to consider the merits of the case against the member sought to be removed under the resolution passed by the Society. 18. Construing Rule 29(2), the Division Bench pointed out that the Registrar can decide the question of approval only after making his own inquiry in a manner he deems fit, consider the resolution on merits and thereafter give approval. Rejecting the contentions of the Society, the Division Bench observed as follows: “That being the position, we are unable to accept the contention of the learned counsel Mr. Apte that under section 35(1) of the Act read with Rule 29 of the Rules, all that the Registrar is expected to do is only to find out whether formalities are complied with and if he ultimately comes to the conclusion that all the necessary formalities are gone through by the Society, he must necessarily give his approval, whether or not the case on merits may be such in which the member concerned does not deserve the punishment sought to be imposed on him by the Society by removing him from the roll of the members.” The Division Bench also referred to the fact that the statute has provided for the remedies by way of appeals and revisions against the orders of the Registrar and these remedies, the Division Bench pointed out, were: “There are, therefore, checks against any frivolous decision or high handed action taken by a Society”. The Division Bench, therefore, upheld the decision of the State Government and further confirmed the view that there was not a single sentence in all the passages in the appeal circulated by the member which could be said to be either detrimental to the interest of the Society or proper working of the Society or even that it could be said to have injured the credit of the Society. 19.
19. It is, therefore, clear that when the Registrar has to make an inquiry under the proviso to section 35(1), the inquiry is not restricted to go into the question as to, in fact, the resolution was passed by a majority of not less than three fourths of the members entitled to vote and who are present at the general meeting held tor that purpose, but the Registrar is entitled to go into the merits as to whether the conduct for which the member is sought to be dismembered was really such that it had brought disrepute to the society or whether the acts in respect of which the member was sought to be expelled were really detrimental to the interest or proper working of the Society. The Registrars decision is made appealable under section 152. Every authority, whose decision is subject to an appeal, is normally required to give reasons for the decision and in that sense, the Registrar has to record his findings With regard to the merits of the resolution of expulsion. Now, once the Registrar decides whether he will give approval to the Resolution or not and that order is subjected to an appeal, then subject to the provisions of section 154, that order or if there is an appeal, the appellate order will become final, in view of the express provisions, of section 154(2). Now, when the finality is given under the Act to certain orders or decisions, then those decisions are not open to challenge under the very Act except in the manner provided by the Act. If the decision remarried in a proceeding under section 35 confirmed or modified under section 152, is allowed to be challenged under section 91, an anomaly will be created. The provisions under section 152(4) will then become otiose. Not only are orders referred to in section 152 given a finality under the Act but they are further made final under section 163(3) of the Act and they cannot be challenged in any Court. There is, therefore, a clear indication in section 152(4) that the orders which are made final under that provision could be subjected to scrutiny only in the revisional jurisdiction under the Act and cannot be subjected to scrutiny or brought into question under any other provision under the Act.
There is, therefore, a clear indication in section 152(4) that the orders which are made final under that provision could be subjected to scrutiny only in the revisional jurisdiction under the Act and cannot be subjected to scrutiny or brought into question under any other provision under the Act. Thus not withstanding the fact that section 91 does not expressly exclude the proceedings under section 35, on a harmonious construction of the provisions of sections 35,152 and 154 on the one side and sections 91, 97 and 149 on the other, will have to be held that each one of these two sets of provisions must independently operate in their own fields and the correctness of the order under section 35 cannot, therefore, be subjected to scrutiny or adjudication in a proceeding under section 91. 20. We have been referred to a decision in (Omprakash Gowardhandas Singhania v. G. V. Moimaitur)2. The question involved in that case was whether a validity of by-law made under the Act can be challenged or whether such a challenge is not permissible under section 91 of the Act. A newly added by-law of a Housing Society empowered the Society to forfeit a plot if the member to whom it is allotted, does not start construction of a house on that plot and does not complete the work of construction within the period mentioned in this by-law or such further period as may be approved by the managing committee on valid grounds. The Petitioners plot was forfeited by the Society and a dispute was raised before the Registrar under section 91 of the Act. One of the prayers made was that by-law 11 /(1) under which an action was taken, should be declared ultra-vires of the provisions of the Act, otherwise bad in law and not binding on the Petitioners and also that the forfeiture of the plot was bad in law, void and not binding on them. The Assistant Registrar, who dealt with the dispute, took the view that the Petitioners were challenging the approval to the by-law by the Registrar and that the Registrars nominee bad no jurisdiction to change the by-laws by declaring them as ultra vire and bad-in-law, once they were registered by the registering authority and that the matter could not form the subject of a dispute under section 91.
The Division Bench, referring to section 152(4), held that under that section, what is made final is not the amendment which is registered, but the order of the Registrar registering the amendment it was pointed out that under sub-section(1) of section 9, the by-laws of a Society must not be contrary to the Act or the Rules and if the by-law is inconsistent with or repugnant to any provision of the Act, the by-taw will be involved, even though it has been registered under section 13 and that there was nothing under section 152(4) which prevents a challenge to the validity of a by-law, after it has been registered. 21. It is difficult to see how this decision is of any assistance to the Petitioner. The Division Bench has observed in that case that what was final under section 152(4) was Dot the by-law, but the order registering the by-law. Now, it is clear that if the by-law itself is invalid on the ground that it is contrary to the provisions of the Act or that it was repugnant to or inconsistent with any provisions of the Act, the invalidity is not taken away by the Order of the Registrar registering the by-law. The registration could be ordered by the Registrar only of a bye-law which is otherwise valid. The decision relied upon is, therefore, clearly distinguishable. 22. In the instant case, we have pointed out that the scope of the inquiry is not merely restricted to go into the procedural aspect relating to the passing of the resolution of expulsion, but even the validity of the resolution could be gone into by the Registrar. Once the validity has been adjudicated upon and such orders are made or confirmed in appeal, then the finality given by section 152(4) of the Act will prevent a challenge being made to the Resolution of expulsion in any other proceedings under the Act, except in Divisional proceedings against those orders. 23. On a fair and harmonious construction of the relevant provisions referred to earlier, we are, therefore, of the view that the matter relating to the validity of the resolution of expulsion will not fall within the provisions of section 91 and that the validity can only be challenged in the manner provided by section 35 and the further provisions relating to appeal and revision against the order under section 35.
We are not, therefore, able to find any infirmity in the order made by the Officer on Special Duty restricting the scope of the dispute before him only to the disputes which do not relate to the validity of the resolution of expulsion. The Assistant Registrar was also, therefore, clearly right in deciding to proceed with the inquiry relating to the validity of the resolution of expulsion by the Petitioner No. 1. 24. In this view of the matter, the Petition must fail. Rule is discharged However, there is no order as to costs. 25. Before parting with the matter, we must express our thanks to Mr. Shastri who has appeased in this matter at our request and has assisted us. Rule discharged. -----