Sarojni Nagar Sainik Co-operative Housing Society, Ltd. v. U. P. Co-operative Tribunal
1991-08-24
S.R.SINGH
body1991
DigiLaw.ai
JUDGMENT S.R. Singh, J. - Sarojini Nagar Sainik Co-operative Housing Society Limited Lucknow is a Co-operative Housing Society registered under the provisions of the U.P. Co-operative Societies Act, 1965 and the Rules made thereunder. It appears that the respondent No. 3 applied for being enrolled as member of the said society on 20-6-1980 and In the declaration form accompanying the application form, he showed his ago as 19 years The respondent No. 3 deposited membership fee amounting to Rs 5/- and also Rs. 100/- as share money. Subsequently, he deposited a sum of Rs. 502.5.92 P. for allotment of Plot No. 46. The society by means of its letter dated 28th August, 1980, informed the respondent No. 3 with reference to his letter dated 24-8-1980 that formalities regarding allotment of corner shop, Kanpur Road and Sharda Canal Road Sarojini Nagar, regarding which your money and membership fee were accepted by the Society, are in progress " The said letter proceeds further that "no sooner this process is over, you will be informed immediately and transfer letter etc. shall be handed over consequently. This "letter was issued by Sri Babu Ram Singh Administrator of the society. By means of another letter dated 24th August 1984, the respondent No, 3 was informed that "the Committee on 23-8-1984 has decided on rules tor the allotment of shop plots. Some of the conditions for allotment of shop plots are : (a) The applicant should not have any other plot in his name. (b) Allotment will be made to ex-servicemen/serving member in that order passed on seniority of application after the publication of the notice passed on the Notice Board. It is therefore, regretted that in view of the above decision, it is not possible to allot shop plot to you. Your advance deposited with the society is refunded. If there are not enough Ex. servicemen/Servicemen, applicants for shop plots, when allotment is made to others, you will be given first priority. Cheque No. BFS/SB 5737994 dated 24-8-1984 for Rs. 5023.40 is enclosed. Please send stamp receipt," 2.
Your advance deposited with the society is refunded. If there are not enough Ex. servicemen/Servicemen, applicants for shop plots, when allotment is made to others, you will be given first priority. Cheque No. BFS/SB 5737994 dated 24-8-1984 for Rs. 5023.40 is enclosed. Please send stamp receipt," 2. It appears that thereafter the third respondent raised a dispute under Section 70 of the U. P, Co-operative Societies Act, 1965, which was referred to for arbitration to the Arbitrator/Co-operative Officer (Awas) Lucknow by his order dared 23-1-1987, a copy of which is annexed as Annexure-5 to the writ petition, passed in Case No. 211 of 1986 Rajesh Chaudhary v. Sarojini Nagar Sainik Co-operative Housing Society, Lucknow and other, directed the respondent No. 3 to b-3 allotted a plot in accordance with the rules. The parties were directed to bear their own costs. It appears that award given in the said case was not implemented whereupon the respondent No. 3 raised another dispute giving rise to Case No. 25 of 1988, Rajesh Chaudhari v. Sarojini Nagar Co-operative Housing Society, Lucknow and others. The Asstt, Housing Commissioner/Asstt. Registrar cum-Arbitrator by his award dated 13-1-1988 annexed as Annexure-6 to the writ petition directed the, petitioner society to enrol the respondent No. 3 as its member forthwith and to determine his seniority on the basis of the admission fee and share money already deposited by him in the past. The Arbitrator farther directed the society by means of the said Award dated 13-1-1988, to take necessary steps for registration of allotment of a plot in favour of the respondent No, 3 on the basis of the premium already deposited by him in the past. It appears that the petitioner filed a writ petition challenging the validity of the aforesaid Award dated 13-1-1988. The writ petition, being Writ Petition No. 1060 of 1989 was dismissed summarily by a Division Bench of this Court vide order dated 7-2-1989 (copy annexed as Aanexure-7 the writ petition) on the ground of alternative remedy i.e. filing of appeal against the impugned award before the Co-operative Tribunal, The petitioner then approached the Tribunal in appeal followed by an application for condonation of delay.
The tribunal by its order dated 24-3-1990 held that there has been no exercise of diligence much less a bonafide exercise of due diligence within the period of limitation and there was no occasion for extension of limitation or condonation of delay. The tribunal further observed that in all probability, the appeal was not. maintainable under Section 98 of the Act. On these findings, the application for consideration of delay was dismissed as barred by time. It is the legality and validity of the said order as also the Award dated 13-10-1988 that is being challenged in the instant petition. 3. Sri R.N. Gupta, learned Counsel for the petitioner has raised the following contentions before me, and they are : (i) that the respondent No. 3 was never enrolled as a member of the society and therefore the arbitration under Section 70 of the Act was incompetent end consequently, the Award dated 13-10-1988 is void and without jurisdiction ; (ii) that the tribunal was not justified in taking a pedantic view on the question of limitation and that it has erred in refusing to condone the delay in filing the appeal; (iii) that it was the sweet-will of the society to enrol a person or not to enrol him as a member. In any case the respondent No. 3 being not eligible for enrolment due to the reason that he was below 21 years of age the society was justified in rejecting the application filed by the respondent No 3 for enrolment; (iv) that the Arbitrator was not competent to direct the society to enrol the respondent No 3 as member of the society. 4. Learned Counsel for the respondent No. 3 refuted the aforesaid contentions raised on behalf of the petitioner and relying upon the communication contained in letter dated 28th August, 1980 contended before me that the society shall be deemed to have enrolled the respondent No. 3 as its member and it was therefore bound to consider respondents application for allotment of a plot in accordance with Bye-laws and the Rules made under the U.P. Co-operative Societies Act (briefly called hereinafter as the Act). The learned Counsel further contended that the award dated 23-1-1987 was allowed by the society to attain finality and therefore, tire society was bound by the said Award end cannot be permitted to wriggle out of its liability under the said Award.
The learned Counsel further contended that the award dated 23-1-1987 was allowed by the society to attain finality and therefore, tire society was bound by the said Award end cannot be permitted to wriggle out of its liability under the said Award. The learned Counsel for the respondent further contended before me that the membership fee and share money having been accepted by the society, the respondent No 3 was entitled to be enrolled as a member in accordance with Rules. The learned Counsel for the respondent No. 3 relying upon Section 17 of the U.P. Co-operative Societies Act also contended before me that his client had attained the age of majority, which according to him is 18 years and, therefore, he was eligible for enrolment as a member of the Society in accordance with Section 17 of the Act. 5. In order to appreciate the contentions advanced by the learned Counsel for the parties, it would be useful to take into consideration the provisions of the Act and the Rules made thereunder in so far as they are relevant for purposes of the membership of the society. Section 2 (n) of the Act defines member to mean a person who joined in the application for registration of the society or a person admitted to membership after such registration in accordance with the provisions of the Act, the Rules and the Bye-laws for the time being in force, Section 17 of the Act provides that no person shall be a member of a Co-operative society except the following, namely : (a) an individual who, except as provided in sub-section (4) of Section 18, Section 80 and sub-section (2) of Section 81, Is of the age of majority according to the law to which he is subject and who is of sound mind and is not disqualified from contracting by any law to which he is subject t (b) any other Co-operative Society ; (c) the State Government; (d) the Central Government; (e) the State Warehousing Corporation established or deemed to be established under the Warehousing Corporation Act, 1962.
(ee) a firm registered under the Indian Partnership Act, 1932 ; (f) a body Corporate not covered by any other clause and approved by the Registrar, for ordinary or nominal membership of Co-operative societies in general or any particular Co-operative Society or class of Co-operative societies on the ground of its being useful in the development of such societies, society or class of societies," 6. Chapter V of the U.P. Co-operative Societies Rules, 1968 (briefly called as the Rules) deals with the membership of a society. Rule 38 of the Rules occurring in the said Chapter being relevant for purposes of the present case may be quoted as below : "38(l)(a) Subject to the provisions of Section 26-A, every application for admission to the membership of a Co-operative Society shall be made to the Secretary who shall place such application as soon as may be, before the authority competent under the bye-laws of the society to take decision on the question of admission to the membership of the society (hereinafter referred to as the competent authority). Explanation - For disposal of an application for admission as a nominal or associate member, an officer of the society may be authorised by the Committee of Management of the society to be the competent authority. (b) The competent authority shall consider the application for admission to membership and fake final decision either admitting or refusing to admit the applicant to the membership of the society. Such decision shall, except when it does not become possible for some unavoidable reasons, be taken : (i) in the case of nominal or associate membership, with is fifteen days of the receipt of the application In the society, and (ii) in any other case, within thirty-five days of the receipt of the application in the society. The decision shall be communicated to the applicant within seven days of the date of the decision. (c) If the decision on the application for admission to membership is not taken and communicated to the applicant within:- (i) thirty days of the receipt of application in the case of nominal or associate membership, and (ii) sixty days of the receipt of application in the case of ordinary or sympathiser membership the application shall be deemed to have been rejected.
(2) No person shall be admitted as a member of a co-operative society unless t - (i) he fulfils the qualifications for membership as laid down in the Act, rules and the bye-laws of the society ; (ii) he has applied for membership of the society in the manner laid down in the bye-laws of the society. 7. The other Rule which is relevant is Rule 43 which provides that no person shall, unless directed by the Registrar for reasons to be recorded, be a member of a Co-operative Housing Society, if such person is already a member of another Co-operative Housing Society in the same town. Conspectus of the aforesaid provisions would reveal that the question of membership of the Society is regulated by provisions of law. No society can claim an absolute power or privilege to admit or not to admit a person as its member. Such a concept strikes at the very root of the concept of rule of law. Even otherwise when the membership is regulated by Rules, admission or non-admission of a person to the membership of the society would be governed by Rules and not at the whims of the Committee of Management of the Society. A decision refusing to admit any person as a member of the Society is appealable under Section 98 (1) (c) of the Act. This also indicates that the society has to act in the matter of enrolment, According to the Rules, and not arbitrarily, whimsically or capriciously As such, 1 find myself unable to agree to the contention advanced by the learned counsel for the petitioner that the society has absolute power to refuse to admit any person to its membership. 8. However, in terms of the definition of the word member as defined in Section 2 (n) of the Act, It is necessary that the person who claims to be the member, must be either a person who joined in the application for registration of the society or a person who is admitted to membership after such a registration in accordance with the provisions of the Act, the Rules and the Bye-laws.
Section 17 read with Section 26 and Chapter V of the Rules, particularly Rules 38 and 43, are the relevant provisions regulating the admission or refusal of admission to membership of the society and the question regarding membership has to be analysed on the basis of the evidence on record and in the light of these provisions. 9. Rule 38 (1) of the Rules indicates that the Authority competent to dispose of the application for membership has to take a decision in the matter and to communicate it to the concerned person within the stipulated period. The Rule further provides that in the event of failure to take a decision and communicate the same to the appellant within the stipulated period, the application shall be deemed to have been rejected. No specific decision admitting or refusing to admit the respondent No. 3 to the absence of any such thing or record, the deemed rejection visualised by Clause (c) of Rule 38 (1) of the Rules may be pressed into service but the tenor of the letters dated 28th August, 1980 and 24th of August, 1984 (Annexures C.A. and C.A. 4 to the counter-affidavit) is employee suggestive of the fact that the respondent No. 3 was admitted to the membership of the society, These letters coupled with the fact that the society had not only accepted membership fee but share money as well from the respondent No. 3 vide receipt No. 7281 dated 20th June, 1980 end the fact that Civil Suit No 204 of 1987 filed by the respondent No. 3 in the matter, was contested by the society inter alia on account of the bar of Section 70 read with Section 111 of the Act, leads to irresistible conclusion that the respondent No. 3 was a member of the society. Section 111 of the Am: bars the jurisdiction of the Civil Courts in respect of any dispute required under Section 70 of the Act co be referred to the Registrar amongst other members specified in the section.
Section 111 of the Am: bars the jurisdiction of the Civil Courts in respect of any dispute required under Section 70 of the Act co be referred to the Registrar amongst other members specified in the section. The fact that the society took a plea of the bar of Section 111 read with Section 70 of the Act in the Civil suit filed by the respondent No. 3, implies that it was admitted to the society that the conditions under which a dispute is referable under Section 70 of the Act, were present One of the conditions as visualised by Section 70 of the Act is that the dispute of the nature specified therein, should be between a member or one hand and the society on the other hand. It therefore, does not lie in the mouth of the petitioner to say that the respondent No. 3 was not a member of the society and that the reference of the dispute under Section 70 of the Act, was not competent. 10. It is true that in his application for reference under Section 70 of the Act, the respondent No. 3 did make a prayer or giving a direction to the society to make him its member but that prayer appears to proceed from some misconception of his true legal status vis-a-vis the society. The arbitrator too appears to have, issued a direction to the society to admit the respondent No. 3 to its membership under the said misconception of true legal status of the respondent No. 3 vis-a-vis the society of the facts and provisions of law stated hereinbefore. 11. It may be that the prayer made by the respondent No. 3 in his application for reference was the genesis of the misconception culminating into the award (supra) but that will not render that part of the Award invalid by which the society was directed to complete the formalities in the matter of allotment of plot in favour of the respondent No. 3. 12.
12. Now coming to the question of maintain ability of reference under Section 70 of the Act, it is evident that any dispute relating to the constitution, management or the business of the society other than a dispute regarding disciplinary action taken against a paid servant of a society, is amenable to reference under Section 70 of the Act, provided that such dispute has arisen :- (a) among members, past members and person claiming through members, past members and deceased members ; or (b) between a member, past member or any person claiming through a member, past member or deceased member, and the society, its committee of management or any officer, agent or employee of the society, including any past officers, agent or employee ; or (c) between the society or its committee and any past committee, any officer, agent or employee or any past officer, past agent or past employee or the nominate, heir or legal representative of any deceased officer, deceased agent or deceased employee of the society or (d) between the co-operative society and any other co-operative society or societies ; 13. The main contention of the learned counsel for the petitioner is that the respondent No. 3 was neither a member of the society nor a past member of the society nor is he claiming through a member or past member of the society and therefore, the dispute between him on one hand and the society on the other, even if it be held relating to the business of the society, is not referable under Section 70 of the Act, the answer to the question of maintainability of the reference at under Section 70 of the Act raised by the learned Counsel for the petition r. depends upon the determination of the fact whether or not the respondent No. 3 was a member within the meaning of Section 2 (n) of the U.P. Co-operative Societies Act. 14. In view of my conclusions on the question of membership of the respondent No. 3, the reference under Section 70 of the Act was perfectly valid. The plea that the respondent No. 3 had not attained the age of majority which according to the learned counsel for the petitioner is 21 years, cannot be permitted to be raised.
14. In view of my conclusions on the question of membership of the respondent No. 3, the reference under Section 70 of the Act was perfectly valid. The plea that the respondent No. 3 had not attained the age of majority which according to the learned counsel for the petitioner is 21 years, cannot be permitted to be raised. As discussed above, the society shall be deemed to have admitted the respondent No. 3 to its membership by its conduct, namely, the acceptance of share money vide receipt dated 20-6-1990 and the assurance given to the respondent No 3 for allotment of plot by letters dated 28th August, 1980 and 24th August, 1984. The questions regarding membership of the respondent No. 3 and the maintainability of the reference under Section 70 of the Act raised by the learned counsel for the petitioner, are answered accordingly. As regards the contention that the Arbitrator was not competent to direct the Society to enrol the respondent No. 3 to is membership, suffice it to say that in view of what I have set oat above, this question does not arise. 15. Now coming to the question of maintainability of appeal and condonation of delay in filing the same, I find that an appeal under Section 98 (2) of the Act, Is maintainable before the Tribunal in respect of an order covered by clauses (d), (f), (g), (k) and (I) of sub-section (1). Clause (d) of sub-section (1) of Section 98 speaks of an order of Registrar under sub-section (2) of Section. 27, expelling or removing a member or under sub-section (2) of Section 38 removing or disqualifying any officer of a co-operative society. Clause (f) speaks of an order made by the Registrar under Section 67 apportioning the cost of an enquiry held under Section 65 or an inspection made under Section 66.
27, expelling or removing a member or under sub-section (2) of Section 38 removing or disqualifying any officer of a co-operative society. Clause (f) speaks of an order made by the Registrar under Section 67 apportioning the cost of an enquiry held under Section 65 or an inspection made under Section 66. Clause (g) speaks of an order of surcharge made by the Registrar under Section 68 while Clause (k) covers ad order made by the Registrar on a question arising between the parties or proceedings under Clause (b) of Section 92 and of the nature referred to in Section 47 of the Code of Civil Procedure, 1908 and Clause (I) refers to an order for attachment of any property made by the Registrar under Section 94 In view of this, the apprehension expressed by the learned Tribunal about the maintainability of appeal before it, does not appear to be unfounded. The present was not a case covered by any of the Clauses (e), (f), (g), (k) & (I) of subsection (I) of Section 98. As such, in my opinion, the appeal against the Award was not maintainable before the Tribunal. In view of this conclusion, it is not necessary for me to go into the question of the validity of the order passed by the learned Tribunal refusing to condone the delay in filing the appeal. It was due to this reason that I heard the counsel for the parties on merits of the Award which was the subject-matter of appeal before the Tribunal. Quintessentially, even otherwise, the conduct of the petitioners society in the instant case disentitles it to invoke the extraordinary and discretionary jurisdiction of this Court under Article 226 of the Constitution of India 16. In the result, the petition falls and is accordingly dismissed. The parties are directed to bear their own costs. Interim order passed by this Court shall stand vacated.