Delhi District Court
Sh. D.R. Roy vs Amit Apartments Owners Association on 18 July, 2016
In the court of Sonam Singh, Civil Judge-05, Central District, Tis Hazari Courts,
Delhi.
Suit No. 524/14
Unique ID No. 02401C0324102006
Sh. D.R. Roy
R/o Flat No. 01,
Amit Apartment,
Sector-13, Rohini,
Delhi-110085 ... Plaintiff
Versus
1.Amit Apartments Owners Association Through its President, Smt. Preeti Gupta W/o Sh. S.K. Gupta, R/o Flat No. 24, Amit Apartments Sector-13, Rohini, Delhi-110085
2. Smt. Preeti Gupta, President W/o Sh. S.K. Gupta R/o Flat No. 24
3. Sh. Naresh Kathpalia, Vice President, R/o Flat no. 82
4. Sh. Amrit Karmakar, Secretary, R/o Flat No. 47
5. Sh. R.K. Keswani, Asst. Secretary, R/o Flat No. 07
6. Late Sh. R.K. Jain (Treasurer) R/o Flat No. 119
7. Sh. Harender Jindal, Asstt. Treasurer, R/o Flat No. 32
8. Smt. Umesh Yadav W/o Sh. Rohtas Yadav, Member, R/o Flat No. 28
9. Smt. Kanta Rani (Member) W/o Sh. Gauverdhan R/o Flat No. 131
10. Sh. O.P. Arya (Member) R/o Flat No. 42
11. Sh. Raman Bhasin, Member, R/o Flat No. 117
12. Sh. Sanjay Gupta, Member, R/o Flat No. 48
13. Smt. Rani Vij, Member W/o Sh. Rakesh Vij, R/o Flat No. 87
14. Smt. Raj Rani, Member W/o Sh. Jag Pravesh Khatri, R/o Flat No. 20
15. Sh. Bharat Bhushan Lal Member, R/o Flat No. 132,
16. Sh. H.S. Dureja, Member, R/o Flat No. 46
17. Sh. S.K. Bansal, Member, R/o Flat No. 06
18. Smt. Sukanya, Member Wife of Sh. Rakesh Bhardwaj, R/o Flat No. 97
19. Sh. Ashok Sharma, Member, R/o Flat No. 34 SL. No. 02 to 19 above are officers of Defendant no. 1 Association and resident in Flats as Indicated against each.
20 Amit Co-operative Group Housing Society (Regn. No. 314/GH) Through its Hony. Secretary Sh. Sukinder Singh R/o 3/2, Singh Sabha Road, Near Amba Cinema, Subzi Mandi, Delhi-07
21. Sh. S.P. Singh (In Personal Capacity) R/o T-29, Andrews Ganj, HUDCO Place.
Khelgaon Marg, New Delhi-49
22. The Registrar Co-Operative Societies (RCS for short), NCT of Delhi, Parliament Street, New Delhi. ... Defendants.
Date of Institution: 18.04.2006 Date of Final Decision: 18.07.2016
1. Vide this judgment, I shall dispose of the present suit filed by the Plaintiff for the relief of permanent injunction and declaration against the Defendants. In short, the main issues which are to be decided is whether the association formed under the Delhi Apartment Ownership Act, 1986 i.e. Defendant no.1 has been formed lawfully and if so, whether the Managing Committee formed under Delhi Cooperative Societies Act ceases to have control over the Management and administration of the housing complex or not.
Plaintiff's version as per the plaint
2. The Plaintiff has averred the following facts in his plaint:
a) The Plaintiff is a promoter member with the membership no. 17 of the Amit Co-operative Group Housing Society Ltd. and was its founder Vice-President . The Society got registered with the registration no. 314/GH with the Registrar of Societies (Defendant no. 20 herein) in the year 1979 under the Delhi Co-operative Societies Act, 1972 (in short 'DCS Act'). The total no. of members is 132 and after due allotment in the year 1998, the Plaintiff is residing in his Flat no. 01, since 1999. The Amit Co-operative Group Housing Society (hereinafter referred to as 'Amit CGHS') is registered under DCS Act and thus, is to be governed and is governed under this Act.
b) Defendant no. 1, Association is purported to have been unlawfully formed under Section 15 of the Delhi Apartment Ownership Act, 1986 (in short 'DAO Act') on 26.02.2006 and Defendant no. 2 to 19 are its self appointed officers. Further, the Defendant no. 1, Association is not registered. Moreover, apart from Defendant No. 5, namely, Sh. R.K. Keswani, all the other 17 are not owners but the Power of Attorney (POA) holders of those allottee members who have sold their flats. These 17 Defendants have only "possessory rights" of these flat and are not even 'nominal' members of the Amit CGHS, as per provisions of Section 91 of DCS Amendment Act (Act 01 of 2005). Also, the Defendant no. 2 to 19 have not been enrolled as members of the Amit CGHS and most of them do not qualify for such membership as per provisions of the Act.
c) That Defendant no. 21, Shri S.P Singh, who happens to be the present President of the Managing Committee ( in short 'MC') is the person who has been pursuing the business of real estate in the garb of Co-operative Group Housing Society with his family members and those of this close associate, namely, Sh. Sukhinder Singh, the present Hony. Secretary. Both of them have been managing to muster majority through fraud and manipulation. The subject matter of this suit arises out of acts and omissions of Defendant no. 21, hence he has been impleaded in his personal capacity.
d) Defendant no. 22, the Registrar of Co-operative Societies (in short 'RCS') is holding the superintending authority under the DCS Act, 1972 and now DCS Act, 2003. The RCS office has patronized the duo of Sh. S.P. Singh and Sh. Sukhvinder Singh.
e) That at the time of granting possession, the Defendant no. 20, Amit CGHS executed a statutory contract with the Plaintiff and its other 131 members under the provision of DCS Act and Rules 1973 and bye-laws of the Society thereunder. The said contract is still subsisting and valid. The privity of this statutory contract cannot be violated by any third party, least by the Defendant no. 1 to 19 or anyone else. The Defendant no. 1 to 19 by their wanton and unlawful actions have violated the privity of this contract. This is not permissible under the law. Defendant no. 1 to 19 acting in concert with Defendant no. 21 are only making a planned attempt to keep the original members deprived of any say and vote in the management of this society in utter violation of Section 93 of the DCS Act, 2003. The reason for their concerted action is absolutely clear by the history of this Co-op. Group Housing Society basically promoted to transact business of real estate by Sh. S.P. Singh, Defendant no. 21, his family and close friends. The borrowed names of these friends and family members is no more available and does not constitute the majority in the group of remaining members (allottees).
f) It is asserted that the Defendants have no right, authority, power or jurisdiction to rescind the said statutory contract, against the wishes of the Plaintiff or for that matter any of the other bonafide members of the Amit CGHS.
g) Plaintiff and other bonafide members and the Defendant no. 20 Amit CGHS perpetually continued to be governed by DCS Act, 1973 and now DCS Act 2003, till such time DCS Act is replaced by an enactment of Indian Parliament. It is further asserted that no other statute can govern the Defendant no. 20 society simultaneously.
The DAO Act is altogether statute enacted with a different legislative purpose. This cannot be applied to the premises of Amit CGHS.
h) Defendant no. 21 Shri. S.P. Singh and his associates found their support in the Defendant no. 20 society dwindling sharply, because of outright sale of many flats of the Defendant no. 20 society to strangers on POA through property dealers doing 'real estate' business.
i) That further the Defendant no. 21 and his associates also became unpopular among the residents and remaining members of the Defendant no. 20 society as his corruption, malpractices and misappropriation of funds by unlawful means became clear. Shri. S.P. Singh has neither submitted audited account statement for several years nor has ever given break-up of maintenance charges nor has presented voucher of expenditure despite repeated demands and has been charging maintenance annually in an arbitrary manner, through an illegal co-ordination committee etc. The maintenance charge cannot be levied on the whims and fences of Defendant no. 1 who is accountable for public money spent by him.
j) Defendant no. 21 in order to continue his real estate business in the Defendant no. 20 society, set up his own men of confidence through collusion. Consequently, Defendant no. 21 set up a 'coordination committee' from above Defendant no. 2 to 19 to extort money from the bonafide members and residents by putting them under fear of injury and rumor mongering.
k) That the Defendant no. 22, RCS declared the said coordination committee set up from among these very Defendant no. 2 to 19 in collusion with the Defendant no. 21, to be unlawful under Section 89 (1) and Section 93 (1) of DCS Act 2005 after receiving information from the Plaintiff. The Defendant no. 22 directed the Defendant no. 20 Amit CGHS and its President Defendant no. 21 to ensure compliance of law and to ensure continuance of essential services and maintenance of the society specifically asserting that this is the responsibility of a duly elected Managing Committee of the Defendant no. 20 Society.
l) It is the game plan of Defendant no. 1 to 19 with Defendant no. 21 in order to maintain their hold, subverting the law and denying the fundamental rights of bonafide members to them. The last AGBM was held for namesake on 09.03.2003 and elections of MC were 'enacted' on 01.06.2003. Defendant no. 22, by his acts, omissions and evident patronage to the duo referred herein has granted time and elections have not been held.
m) After the order dated 05.07.2005 of the Defendant no. 22, RCS, the Defendant no. 2-19 further conspired with the Defendant no. 21 Sh. S. P. Singh to find ways and means to continue with their unlawful real estate business in the Defendant no. 20 society. The Defendant no. 2 to 19 in connivance, with the Defendant no. 21, Sh. S.P. Singh became desperate to bye pass and circumvent the order dated 05.07.2005 of the Defendant no. 22 with evil intention of garnering unlawful money from the bonafide members/residents to indulge in unscrupulous sale and purchase of flats in the society complex.
n) The Defendant no. 2 to 9 with the sinister connivance, of the Defendant no. 21, Sh. S.P. Singh, posed to have convened an unlawful general body meeting on 26.02.2006 excluding the Plaintiff and majority of other bonafide members/residents of the Defendant no. 20 Amit CGHS, without any sanction of law. The Defendant no. 2-19 had no authority, power, jurisdiction or locus standi to call for a 'General Body Meeting' of the Defendant no. 20 Amit CGHS. The acts of commission and omission of the Defendant no. 2 to 19 are illegal, malafide, ultra wires and motivated by temptations and wrongful gain to cause illegal and wrongful loss to the members/ residents/owners of the Amit CGHS other than these Defendants.
o) That in execution of their malafide plans and conspiracy the Defendant no. 2 to 19 along with some other docile power of attorney holders declared 'the constitution and formation of unlawful 'Amit Apartment Owners Association' vide resolution dated 26.02.2006, which de facto was resolved only by them in privacy.
p) That the Defendant no. 1 to 19 acting unlawfully declared to have taken over the administration and management of the Defendant no. 20, Amit CGHS by taking criminal venture and committing trespass. The Defendant no. 1 to 19 sent a letter dated 27.02.2006 declaring the evil and unlawful intention to forcibly hijack Defendant no. 20 Amit CGHS Society to the Defendant no. 21. It is significant that the Defendant no. 2-19 did not inform Defendant no. 22. Defendant no. 20 being in collusion and connivance with Defendant no. 1 to 19 kept quiet for a long time and did not act.
q) That the inquiry, resentment and unrest in the minds of bonafide members/residents of the Defendant no. 20 society grew with every passing day due to this brazen assault on their constitutional fundamental rights by the outsiders to the Defendant no. 20, Amit CGHS. Under the pressure of such bonafide members of Defendant no. 20 society, the Defendant no. 20 Shri S.P. Singh started some eyewash and wrote some letter to Defendant no. 22 RCS regarding the activities of Defendant no. 1 to 19. The contents of such letter are not known to the Plaintiff and are in the special knowledge of Defendant no. 21 to 22 only.
r) That the Defendant no. 1 to 19 continuing their criminal and unlawful assaults on the right and privileges of the Defendant no. 20 Amit CGHS forcibly removed the boards of the society and security guards, plumber and other staff illegally and unauthorizedly and placed their own board of 'Amit Apartment Owners Association' and a warning about reporting the matter of sale purchase and renting to them. They conspicuously exhibited their names and addresses on the board of the two gates of the society complex. Thus, created an evident fear in the minds of residents and even visitors by such exhibition of force to create an atmosphere for their unlawful collection of money/construction activities in the complex.
s) That the Defendant no. 1 to 19 have very conspicuously also displayed these boards creating their mandate that all sale,purchase and renting should be done through them and them alone without any say of any other person forcing carrying out of real estate business in the Defendant no. 20, Amit CGHS in connivance and conspiracy with the Defendant no. 21 for their own gains. This frustrates the very object of DCS Act, 2003 which is a welfare act meant as the major of self help for individuals in need of residences in the NCT of Delhi.
t) That the Defendant no. 1 to 19 have actually brought construction material in the premises of the Defendant no. 20 Society and are indulging in construction activity without any sanction or permission of the General Body of the Defendant no. 20 Society or the approval of Defendant no. 22. The Defendant no. 1 to 19 are having no authority to carry out any construction in the common areas of the Defendant no. 20 Society without prior sanction or approval of General Body of Members or the statutory authorities like MCD, DDA or the like.
u) That the Defendant no. 22 vide its order no. F-47/314/Coop/GHS/NW/691 dated 31.03.2006 has already declared the formation of Defendant no. 1 association illegal. The Defendant no. 22 further vide same order has declared all the activities of the Defendant no. 1 to 19 unlawful and illegal.
v) That the Defendant no. 21 Sh. S.P. Singh being in collusion, with the Defendant no. 1 to 19 has taken no steps to implement the order no. F47/34/Coop/GH/NW/691 dated 31.03.2006 of the Defendant no. 22. The Defendant no. 21 has taken no steps to remove the unlawful boards and signboards put up by the Defendant no. 1 to 19. The Defendant no. 21 has not lodged any report with the police against the Defendant no. 1 to 19 for their illegally vandalizing the property of the Defendant no. 20 society removing of lawful boards and sign posts and removing duly engaged security guards and other staff. The Defendant no. 21 has not lodged any report with the police to stop the illegal construction being indulged in by the Defendant no. 1 to 19.
w) That despite orders dated 05.07.2005 of RCS, Defendant no. 22, and again dated 31.03.2006, these Defendants are collecting money unauthorizedly and indulging in building activity in unauthorized manner without any approval of General Body of the Society.
x) As per Section 91 of the DCS Act 2003, none of the POA holders nor Defendant no. 2 to 9 (except Defendant no. 5 a misguided original allottee) are even 'nominal' members. As per law, they cannot have any say in the management of this housing complex.
y) That the letter written by the Secretary of Defendant no. 1 association on 27.02.2006, who is impleaded as Defendant no. 4 herein vide para 2 stated the following:
"The Association has formally declared to have taken over the administration and management of the Amit Apartment w.e.f 27.02.06.". Hence, such a dictatorial act is anathema to the law.
z) That the Defendant no. 1 to 19 have displayed the list of office-bearers on the Gate no. 1 of the Amit Apartments, since 27th February 2006, after throwing away the ' board' of the Amit CGHS.
Thus, by way of the present suit, the Plaintiff has sought the following reliefs: relief of declaration, declaring Defendant No.1 as illegal; relief of injunction against Defendants no.1 to 19 prohibiting them from interfering in the management, maintenance and administration of Defendant no.20 and also to direct them to remove their unlawful boards and illegally deputed persons from the Society complex since 27.02.2006; relief of injunction against Defendant no.1 to 19 restraining them from extorting money, in the name of maintenance or any other activity in the name of the Society, from the Plaintiff or any similarly placed member or resident or GPA holder, relief of mandatory injunction , directing Defendant no.20 and 21 to take all lawful steps to implement the order dated 05.07.2005 and 31.03.2006 of Defendant no.22.
Defendants no. 1 to 19's case (Except Defendant no.3 and 18) as per their Written Statement:
2. The Defendants no.1 to 19 (Except Defendant no.3 and 18) have made the following preliminary objections in their Written Statement:
a) That the present suit is not maintainable as Delhi Development Authority is necessary party of this suit. Non-impleadment of DDA to the suit, is thus fatal and suit becomes bad for non-joinder of necessary parties.
b) That the Plaintiff has not come to this Hon'ble present suit with clean hands and in the garb of present suit wants to advice his extraneous interests. The Plaintiff has deliberately suppressed the fact that he had been member of all the Managing Committee from 1979 till 2000 and had also remained Secretary from May 1999 to January 2000. That the Plaintiff himself is engaged in trading of flats with few of his associates namely, S.P. Singh, Kuldeep Singh, Inderjit Singh and Bodh Raj Gupta.
Plaintiff was the Chairman of the Committee, which had awarded contract for construction of 132 flats to the husband of a member of Co-operative Society, namely, Baljit Kaur, Membership no. 101. That the Defendant no. 1 is a statutory body formed and constituted under the provisions of Sec. 15 of the DAO Act and its functioning could not be stayed as prayed for by the Plaintiff.
c) That the suit is not maintainable as no compliance has been made with provisions of Sec. 129 of DCS Act, 2003, whereby a statutory notice has to be served upon the Registrar,well 90 days in advance to filing of a suit.
d) That the suit is collusive between the Plaintiff and Defendants nos. 20-22 and as such is liable to be dismissed.
3. The aforesaid Defendants have made the following averments as per reply on merits:
a) Defendant no. 1 is a statutory body and is formed lawfully in accordance with the provisions of Section 15 of the DAO Act and the Rules and Bye-laws framed thereunder. Defendant nos. 2-19 are the members of the board of Management duly elected in accordance with the bye-laws. It is averred that to own on apartment in a housing complex promoted by the Co-op. Group Housing Society, as a subsequent purchaser thereof, it is not necessary that the purchaser becomes member of the promoting society. In accordance with the provisions of DAO Act, purchasers of flats in the Housing Complex comprising of multistoreyed apartments, automatically became members of the statutory association. It is averred that under the DCS Act, no ownership rights were available even to the original allottee of flats. Group Housing Society itself being lessee of DDA, could have granted only the sub-lessee rights in the said land to its members. It is only after coming into force of DAO Act that the apartments had become fully heritable and transferable and ownership rights had come to rest not only in allottees of the flats but also in their transferee. It is submitted that after DAO Act came into force, the promotee Co-operative Societies have been relegated to the status of promoter only and acquiring of its membership is neither a condition precedent nor relevant in any manner whatsoever for purpose of transfer of rights and title in the Apartment. It is denied that the Defendants are not owners of the Apartments purchased by them. It is also submitted that the Defendant no. 1 being a statutory body, does not require any registration. It is clarified that the answering Defendant are not claiming under the DCS Act but under the DAO Act which has conferred full ownership rights after 1987, upon allottee of flats and also upon subsequent transferee.
b) Defendant no. 21, Sh. S.P. Singh is close associate and business partner of the Plaintiff and the present suit is collusive between them as against the Defendant no. 1 to 19.
c) The rights and obligations of the answering Defendants arise under the statute of Parliament i.e. DAO Act and in case of a conflict the provisions of statute would override any terms of the contract. It is denied that allottee members would be denied say in the management rather allottee and their transferee all have at par rights in the management of Defendant association.
d) Firstly, contracts are not statutory and secondly, the contracts would certainly give way to statues as is recently hold by Hon'ble Supreme Court in Prasant Mahata's Case.
e) DCS Act, 2003 is not an Act of Parliament, rather of Legislative Assembly, while DAO Act is passed by Parliament. It is further denied that the DAO Act does not cover the complex promoted by the Delhi Co-op Society. Section 2 of the DAO Act, specifically and primarily includes the residential complexes promoted by Co-
op. Society within its holds.
f) All subsequent purchasers of flats in housing complexes promoted by the Co- op Societies acquire the full ownership rights on purchase of those flats.
g) The Managing Committee of the Co-op. Housing Society had become different and co-ordination committee of residents was framed to manage the common areas and services in the Housing complex.
h) No doubt, to manage the housing complex after allotment of flats by it, is the 'duty' of the promoter society. But it is underlined that it is merely a 'duty' and cannot be claimed as a matter of right and this 'duty' stands discharged as soon as the Association of Apartment Owners is formed under Section 15 of the DAO Act and taken over the management and administration of the housing complex.
i) It is averred that the Plaintiff is also member of the Defendant no. 1 having rights at par with other members of the Defendant association thus, there cannot be any question of denying the rights to the Plaintiff. He can always participate in the affairs of the management and administration of the housing complex being member of the Defendant association.
j) The meeting of all apartment owners was called and conducted to form the statutory association under Section 15 of the DAO, Act, and the body was successfully formed by the owners of apartments, with statutory intimation sent to Delhi Development Authority.
k) It is averred that the Defendant no. 1 association has been formed under Section 15 of the DAO Act in due compliance of the procedure established by the law. It is thus, denied that the Defendant association is unlawful or has been formed in privacy.
l) The Defendant no. 1 has only taken over the management and administration of the housing complex and not of the housing society.
m) Defendant no. 20 is no authority to interfere in the functioning of the statutory association. The acts are within the domain of powers of the Defendant no. 1 and have been performed in discharge of official duty.
n) In fact, the common expenses determined by the Board of Management of the Defendant Association create a first charge upon the flat under, DAO Act, and thus, the purchasers have to take "No Dues" certificate from the Association at the time of purchase. To prevent any fraud in this regard upon innocent purchasers of flats, the warning board is displayed inconspicuous manner. No construction as against the law is planned by the Defendant Association.
o) The alleged letter of the RCS does not refer to the statutory body, i.e. the Defendant no. 1. Even otherwise RCS is no authority under the law, to rule upon the body under the DAO Act. Vice Chairman, DDA is the authority competent in this regard, being notified under the DAO Act by Hon'ble Lieutenant Governor.
p) The Association was formed on 26.02.2006, now in the end of April, the Plaintiff cannot plead an urgency. Notice Under Section 129 is mandatory requirement under the DCS Act, 2003 and there is no provision in DCS Act for waiver of notice.
Hence, in view of the aforesaid, the aforesaid Defendants have claimed that the suit filed by the Plaintiff should be dismissed.
Defendant no. 3 to 18's case as per the Written Statement:
4. The Defendants no.3 to 18 have averred the following in their Written Statement:
a) This court lack jurisdiction to try and entertain the present suit. It is averred that jurisdiction of civil court is specifically barred under Section 132 of DCS Act, 2003. It is averred that as per allegations contained in the plaint, the dispute as raised by the Plaintiff touches management and the business of Defendant no. 20 and further since Plaintiff is a member, the suit has been filed against Defendant nos. 4,20 and 21 who are members as per the allegations in the plaint. The dispute raised by the Plaintiff in the plaint is fully covered under the dispute referred in Section 70 of DCS Act, 2003.
b) That the suit has neither been valued properly for the purpose of court fee and jurisdiction nor requisite court fees as per the prayer sought in the plaint has been paid. As many as seven reliefs have been sought by the Plaintiff in the prayer clause which are separate and distinct from each other and against different Defendants but suit has been valued for two reliefs only.
c) That there is no cause of action in favour of the Plaintiff and against the replying Defendants to file the present suit. It is averred that Plaintiff has nowhere disclosed in the entire body of plaint as to how he is aggrieved person by the formation of Defendant no. 1. At best, as per the averment in the plaint, it could be Defendant no. 20 who may consider itself as an aggrieved party to challenge the rights authority and formation of Defendant no. 1. It is averred that admittedly the Plaintiff is not a member or office bearer of Defendant no. 20. It is further submitted that in view of the written statement filed by the Defendant no. 20 and 21, the suit of the Plaintiff has become infructuous ab-initio as Defendant no. 20 and 21 have denied any cause of action to have arisen in favour of the Plaintiff to file the present suit and to seek the relief.
d) That the present suit is not maintainable as Delhi Development Authority is necessary party to this suit. Non-impleadment of DDA to the suit is thus, fatal and suit becomes not maintainable for non-joinder of necessary parties.
e) The present suit also suffers from misjoinder of parties. It is averred that Defendant no. 22 is not a necessary party for the adjudication of the issues raised in the present plaint. Further, this court does not have jurisdiction to pass any direction to the Defendant no. 22 in view of the specific bar u/s 132 of the DCS Act, 2003 and Section 9 of Code of Civil Procedure, 1908 (in short 'CPC').
f) That present suit is also not maintainable on the ground that same has been filed by the Plaintiff in collusion with Defendant no. 20 and 21. It is averred that Plaintiff himself has been member of the managing committee, i.e. Defendant no. 20 from 1979 to 2000 and he was secretary from May, 1999 to January, 2000. During this period this Plaintiff, extorted money from the bona fide purchaser of the flat either in the name of entry fee or on other pretext. After January, 2000 he was not elected afresh and then he did not handover the records of his tenure to the new constituted committee. In this respect, search warrant has already been issued by the assistant Registrar u/s 33 (1) of DCS Act against the Plaintiff. The said search warrants yet not being effected as he has filed a number of cases against the committee, Defendant no. 20. Plaintiff has never contributed towards common facilities of the society.
g) There are total 132 flats in the complex of society, which were allotted to the members as per the DCS Act. Out of these 132 members, 88 members have already sold out their flats through GPA etc. So far as remaining 44 members are concerned only 20 (approx) members reside in the society and rest of them reside out of the society and they have rented out their respective flats. So far as members of management committee are concerned except one vice-president, Sh. P.C. Jain and one lady member, no other member of Defendant no. 2 reside in the society but despite all this, these are the office bearers who rule the society sitting outside of it through and at the behest of Plaintiff. Management committee has been collecting maintenance from the residents but same is not spent on the common facilities were not provided to the residents. Residents were forced to live without electricity and water days together. Further, numbers of cases were filed against each other by the members and office bearers of the Defendant no. 20 including the Plaintiff and litigation charges were always forced upon the residents as same was included in the maintenance. The purchasers were forced to pay entry fee at the rate of 40,000/- or at any other rate where ever it was settled and no account of it was ever maintained. It is a recorded fact that audit of account has not been done since 1996-97.
h) Due to these compelling circumstances, the residents of society formed the association under DAO Act vide resolution, which was duly signed in a General Meeting by 82 persons, which includes Sh. P.C. Jain present Vice-President of the Defendant no. 20. This was a voluntary act by the residents. Out of around 120 occupied flats, 105 (approx) have contributed towards expenses of the common areas of the society. Even Vice-President of the Defendant no. 20 and Smt. Harjeet Kaur, member of Defendant no. 20 have paid their monthly expenses towards common expenses to the Defendant no. 1. It is Defendant no. 1, which is looking after the affairs of the society as per the desires of the residents. Defendant no. 22 has become ineffective by its own.
i) In view of the resolution dated 26.02.2006, association of Defendant no. 1 was formed and there after its intimation was duly submitted in the office of competent authority under the said act, which is vice-chairman of DDA with list of Board of Management. A letter to that effect was duly sent to the P.S. Parshant Vihar and also to the Defendant no. 20. The Defendant no. 1 has not deprived the Defendant no. 20 of any of its powers. The Defendant no. 1 is a statutory body duly constituted u/s 15 of the DAO Act. DAO Act is a separate and independent act and has been passed to provide ownership of an individual apartment in a multistoried building and every person who has got possession of a flat either by sale or transfer in any manner.
Rights, liabilities and check over the activities of Defendant no. 1 have been provided under the said Act. Defendant no. 1 is acting strictly as per the bylaws of the Defendant no. 1 as given in the Act itself. As per the said Act, every occupant of a flat is a member of Defendant no. 1 and is liable to contribute towards common expenses. Even an occupant cannot exempt himself from liability for contribution by waiver of use of the common areas and facilities.
j) The Plaintiff himself is engaged in trading of flats with few of his associates namely, S.P. Singh, D-21, Gurpal Singh, Virender Pal Singh, Kuldeep Singh, Inderjit Singh and Badh Raj Gupta. Plaintiff was the chairman of the Committee, which had awarded contract for construction of 132 flats to husband of a member of Co-op. Society namely Baljit Kaur, Membership No. 101. In civil writ petition bearing no. 6361/2003, flats of office bearers of Defendant no. 20 including that of Plaintiff have been placed under status quo order in order to secure the recovery of amount, which may be found due to these members as these members have played a fraud by making an embezzlement and have not got audited their account since 1997.
k) That the suit is not maintainable as no compliance has been made of provisions of Sec. 129 of the DCS Act, 2003, whereby a statutory notice has to be served upon the Registrar well 90 days in advance before filing a suit.
l) That the suit is collusive between the Plaintiff and Defendants nos. 20-22 and as such is liable to be dismissed.
m) Further, the pleadings averred by the aforesaid Defendants were almost similar to what was pleaded by Defendants no.1 to 19.
Defendant no. 20's case as per the Written Statement:
5. The Defendant no.20 averred the following in its preliminary objections:
a) That the present suit is not maintainable on account of misjoinder of parties, since Defendant no. 20 to 21 have been impleaded without any cause or reason.
Impleadment of Defendants 20 and 21 in the present suit by the Plaintiff is the outburst of the Plaintiff against the said Defendants and to settle his personal score with Sh. Sukhinder Singh and S.P Singh.
b) That the present suit does not disclose any cause of action against the answering Defendants as the relief of declaration sought by the Plaintiff, to declare, Defendant no. 1 Association illegal, malafide, ultravires and outside the provisions of DCS Act, 2003 has already been granted by Defendant no. 22,RCS. The same was granted vide no. F.47/314/Coop./GHS/NW, dated 31.03.2006 and 05.07.2005, on the prayers of the answering Defendant no. 20-Society and 21, in the capacity of the president of Defendant no. 20, when they approached the office of the Registrar of Cooperative Societies, after the illegal actions of Defendant no. 2 to 19 of illegally usurping the powers of the Defendant no. 20 and illegally claiming to be the successor of Defendant no. 20. In fact, the Defendant no. 20 is the parental statutory body and since its constitution is looking after the management, administration and housing complex of the Defendant no. 20 under the supervision and control of Defendant no. 22 and nobody can claim to be its successor and if any body is doing so, the same is illegal and not sustainable in law.
c) As far as the allegation of the Plaintiff that the answering Defendants have not taken any lawful steps against the Defendant no. 1 to 19 is concerned, it is averred that immediately upon the illegal actions of Defendant no. 1 to 19 on 04.03.2006 of illegally usurping the powers of Defendant no. 20 and illegally claiming to be the successor of Defendant no. 20 society, the Defendants 20 and 21 in the capacity of president of Defendant 20 and other Executive Members of the Defendant no. 20 lodged a complaint dated 04.03.2006 with the SHO, Prashant Vihar Police Station on 05.03.2006 for taking action against the Defendants 1 to 19 about the illegal activities of the Defendant 1 to 19. On 06.03.2006 the answering Defendants sent a letter to Defendant nos. 4,6 and 7 with regard to unauthorized collection of dues from members/residents. The answering Defendants have also circulated the letters dated 31.03.2006 and 05.07.2005 to the residents of Amit CGHS (Defendant no. 20- Society) about the declaration of Defendant no. 1 Association as illegal. That the Answering Defendants have also sent notice dated 12.04.2006 to Defendant no. 2 to 19 (copy annexed as Annexure D-20/4) for restraining them from carrying out illegal activities in the Defendant no. 20-Society premises and in the said notice it has been specifically mentioned to the Defendants 2 to 19 to remit back the funds collected by the Defendants 2 to 19 under the banner of alleged Defendant no. 1 association to Defendant no. 20-Society, otherwise appropriate civil and cirminal proceedings will be initiated against Defendants no. 2 to 19.
d) The answering Defendants have no collusion with the Defendants no. 1 to 19 The circulars and statements issued by the Defendants no. 2 to 19 , under the banner of alleged Defendant no. 1 Association are their self-serving statements and circulars, which they are doing illegally and the answering Defendants have already taken legal steps through the statutory authorities against them and if the said statutory authorities fail to take action against the Defendants 1 to 19 then the answering Defendants will approach the courts for taking lawful actions against the Defendants 1 to 19.
6. The Defendant has made the following averements in its reply on merits:
a) It is averred that submissions of the Plaintiff that the said alleged Amit Apartments Owners 'Association was formed on 26.02.2006 are not in the knowledge of the answering Defendants as the answering Defendants came to know about the formation of alleged Amit Apartments Owners' Association only on 04.03.2006 when suddenly on that morning Defendant no. 2 to 19 attacked the premises of Defendant no. 20 and threatened the employees of Defendant no. 20 to return back to their homes as they are no longer employees of the Defendant no. 20 and then issued self serving statements and circular.
b) It is admitted to the extent that at the time of granting possession, the Defendant no. 20, Amit CGHS executed a statutory contract with Plaintiff and its members under the provisions of DCS Act 1972 and Rules 1973 and bye-laws of the Society thereunder. It is admitted that the said contract is still subsisting and valid. It is again admitted that the privity of this statutory contract cannot be violated by any third party least by the Defendant no. 1 to 19 or anyone else. It is admitted that the Defendant no. 1 to 19 by their wanton and unlawful actions have violated the privity of this contract. This is not permissible under the law. It is denied that the Defendant no. 21 in concert with Defendant no. 1 to 19 are making planned attempt to keep the original members deprived of any say and vote in the management of this society in utter violation of Section 93 of DCS Act 2003.
c) A 'Coordination Committee' was formed by Defendant no. 20 amongst the members/residents of the Amit CGHS in order to assist the Defendant no. 20 only and explore the possibility of applying the society's funds in the development of society at appropriate places, which the Plaintiff has taken otherwise.
d) Defendant no. 22, by letter dated 05.07.2005 made it amply clear that the Managing Committee of the Defendant no. 20 is the only competent authority to collect the maintenance charges from the members/residents of the Defendant no. 20 and none else, which is the only parental body competent and no other association can be its successor. The said instructions has been reiterated by the Defendant no. 22 vide its letter dated 31.03.2006 declaring the Defendant 1 association as illegal association on the request of Defendant no. 20 and Defendant no. 21 in the capacity of president of Defendant 20 only.
e) Defendant 2 to 19 illegally agreed to form an illegal Association, which they named it as Amit Apartments Owners' Association (Defendant no. 1 herein) purported to be formed under Section 15 of the DAO Act. The illegal object was to take over the management and administration of the Society in utter violation of the DCS Act/Rules without the knowledge of the Defendants 20 and 21. On 04.03.2006, the Defendant no. 2 to 19 implemented their said conspiracy and ulterior designs and in doing so they forcibly removed the boards of the Managing Committee of the Society, forcibly removed the Guards/employees of the society who made complaints to the Police and they were reinstated but they are not allowed to work by the Defendant no. 2 to 19 till date and by illegal means Defendants 2 to 19 took over the charge of the common-facilities of the society under the alleged banner of Defendant no. 1. The Defendant no. 2 to 19 placed their own boards in and around the society and started conveying wrong messages to the members/residents of the society that the Managing committee is not in existence and from now onwards they are the only custodians and successors of the Managing Committee of the Society. The Defendant 2 to 19 illegally started collecting maintenance charges from the Members/residents @ 1050/- per quarter for the period January-February 2006 and in advance April-June 2006. The Defendant 20 and Defendant no. 21 in the capacity of president of Defendant-Society took the lawful actions against the Defendant no. 2 to 19.
f) Defendants no. 2 to 19 conspired to find ways and means to continue with their unlawful real estate business in the Defendant 20 and they bypassed the order dated 05.07.2005 of the Defendant 22-ROC.
g) Defendant no. 1 to 19 are utilizing the funds illegally collected by them and doing illegal construction activity without any approval.
h) Defendant no. 21 has been impleaded in personal capacity by the Plaintiff and in the personal capacity, the status of the Defendant no. 21 is only an ordinary member of Defendant no. 20-Society, which status Plaintiff himself is enjoying in the Defendant no. 20-Society. No-where in the corresponding para of the Plaint the Plaintiff has stated as to how cause of action has arisen against Defendant no. 20.
Defendant no. 22 case as per the Written Statement:
7. The Defendant no.22 has taken the following preliminary objections in its Written Statement:-
a) That the present suit is not maintainable as the Plaintiff has approached to this Hon'ble Court with unclean hands by suppressing material facts, hence the suit is liable to be dismissed.
b) That the present suit is bad for misjoinder and nonjoinder of necessary parties hence the present suit is liable to be dismissed outrightly.
c) That no notice under Section 129 of DCS Act & Rules 2003 has been served upon the answering Defendant which is a statutory requirement before filing the present suit.
d) That there exists no cause of action against the answering Defendants hence the suit is liable to be dismissed.
e) That this Hon'ble Court has no jurisdiction to entertain the present suit, hence the suit is liable to be dismissed on this ground only.
8. Defendant no.22 has made the following averments in its reply on merits:
a) The answering Defendant have full right authority or jurisdiction to ensure the compliance of provisions of DCS Act Rules and directives for the Group Housing Society registered with him. This is to ensure that the purpose of co-operative movement is not defeated.
b) The society registered with RCS office is allotted land by the landowning agency at subsidized rates under cooperatives movement,which is allotted to its members for construction of house. In case of CGHS the flats built by the society are allotted to its members, through draw of lots by the DDA and thereafter the affairs of the society are managed by the Managing Committee of the society, elected as per the provisions of DCS Act &Rules., The provisions of any other Act cannot be applied for the CGHS for enforcing the provisions of DCS Act and Rules.
c) It is admitted that the answering Defendant did not reveive any letter from Defendant no. 1 to 19. However, the Defendant no. 20 approached the Defendant no.
22 vide their letter dated 31.03.2006 complaining about the hijacking of the society by the Defendant no. 1 and encroaching their rights and duties vested in them under Provisions of Section of 89 and 93 i.e. the development and maintenance of the society. The answering Defendant was informed vide letter dated 05.07.2005 about constitution of a Coordination Committee by Managing Committee of the society to look after the maintenance of the essential services.
d) It is averred that letter written to Defendant no. 22 by Defendant no. 20 were duly attended without any loss of time and requisite replies were sent to the society.
e) The remaining Defendant has already appointed Returning Officer to hold election to the Managing Committee of the Society, as the provisions of the Act & Rules 2003. Further, members of the society may bring new person in place of Defendant no. 21, if in their opinion, he is not the best suited for the post. On the basis of letter of the Defendant no. 20, the answering Defendant has already issued letter dated 31.03.2006 reflecting therein that only Management Committee is solely responsible for maintenance of essential services under Section 89 and 93 of DCS Act & Rules 2003.
f) It is also pertinent to mention that as per section 132 of DCS Act and Rules 1973, no civil court have any jurisdiction in respect of affairs of the Cooperative Societies Registered under DCS Act. The remedies are available under DCS Act and Rules itself. The RCS is fully empowered to pass order after the hearing party under various provision of the act as such this Hon'ble Court has no jurisdiction to entertain the present suit.
Replications filed by the plaintiff:
9. The Plaintiff made the following averments in its replication:
a) The Defendants' No. 1 to 19 have formed "Amit Apartments Owners' Association" under the non-existent and repealed statute, DAO Act, 1986. It is averred that it is well known to the Defendants' no. 1 to 19 that the rules, bye-laws etc. under DAO Act were never notified/published. Although the amended rules were finalized by the Ministry of Urban Development in Consultation with the DDA and the Government of NCT of Delhi in 1998, their notification was withheld.
b) That even if it is assumed only for the sake of arguments without admitting that the DAO Act is in force, the acts of the Defendants' No. 1 to 19 are illegal, malafide and unlawful under the very provisions of the DAO Act. It is well known to the Defendants' no. 1 to 19 that the DAO Act being relied by them before this Hon'ble Court, was not meant to govern the flats of Co-operative Group Housing Societies, in view of the specific proviso to the Section 5 of DAO Act.
c) The provisions of the DCS Act, 2003 (As amended by Act 1 of 2005) override the provisions of any other statute. Section 140 of the DCS Act, 2003 (As amended by Act 1 to 2005) is quoted below for ready reference: -
"Section 140. Act to override other laws. The provisions of this Act shall have the effect notwithstanding anything inconsistent therewith contained in any other law..."
d) That Section 91 of the DCS Act 2003 has incorporated special provisions for the power of attorney holders of the flats in co-operative societies, specifically inserted through amendment Act (Act 1 of 2005) in Delhi Co-operative Societies Act 2003.
e) Defendants' no. 1 to 19 due to their malafide and ulterior motives have not availed of the available opportunity extended by Section 91 of the DCS ,Act 2003. The Defendant no. 1 to 19 have the evil intention of robbing the Government of the revenue to be paid by the Defendants' no. 1 to 19 to avail the benefits of the Section 91 of the DCS Act, 2003.
f) The Defendants' no. 1 to 19 have not even complied with any of the provisions of the repealed DAO Act by which they intend to vouchsafe their entire stand before this court. That none of the Defendants' No. 1 to 19 have duly executed and registered the 'Deed of Apartment' which was mandatory under the very provisions of the said Act .
g) That none of the Defendants' no. 1 to 19 are having any 'separate deeds of sub- lease, in respect of such land in favour of each apartment owner , required under Section 8 of DAO Act.
h) That so much so that the Defendants' no. 1 to 19 have not complied with the mandatory provisions of the DAO Act, while purporting to have formed an Association under Section 15 of the said act.
i) That Hon'ble High Court of Delhi vide its judgment dated 31.03.2006 in WP(C) No. 4949/2006 in Mr. V.K. Goyal Vs. Ordinance Cooperative G/H Society has held that transferee of a member of a cooperative group housing society notwithstanding his freehold status has no locus standi under DCS Act. In view of the said law declared by the Hon'ble High Court of Delhi, the Defendants' no. 1 to 19 do not have any locus standi in the affairs, management and administration of Amit CGHS Society or its members till such time the Defendants' No. 1 to 19 acquire the membership under the provisions of Section 91 DCS Act, 2003. The Defendants' no. 1 to 19 are attempting to forcibly trespass into the office of the Managing Committee of the Amit CGHS.
j) The Defendants' No. 1 to 19 and their counsel Sh. V. P Rana are guilty of perjury for making false statements before this Hon'ble Court through false averments and pleading false law. The solemn duty of the said counsel was to advise the Defendants' no. 1 to 19 before submitting the said false written statement to this Hon'ble Court, the fact that the Government repealed the DAO Act in the year 2000 itself.
10. On 28.01.2008, the following issues were framed:
1. Whether this court has jurisdiction to entertain the present suit in view of section 132 r/w Section 70 of Delhi Cooperative Societies Act, 2003 and in view of Section 15 of Delhi Apartment Ownership Act, 1986? OPD
2. Whether the Plaintiff has not properly valued the present suit and has not paid the correct court fees?
3. Whether the present suit is not maintainable due to lack of cause of action in favour of Plaintiff? OPD
4. Whether the present suit is not maintainable due to misjoinder of necessary parties? OPD
5. Whether the present suit is not maintainable due to non compliance of the provision of section 129 of Delhi Cooperative Societies Act, 2003? OPD
6. Whether the Plaintiff is entitled to the reliefs claimed in plaint? OPP
11. It is pertinent to state in here that no one had appeared on behalf of the Defendants on 29.11.2011, and suit was proceeded ex-parte against the Defendants on 29.11.2011. On 20.05.2013, the Plaintiff had submitted that Defendants no. 6, 9 & 10 had expired and that he does not wish to proceed against the LRs of the deceased Defendants. Further, on the request of Ld. Counsel for the Plaintiff, Defendant no. 22 was also deleted from the array of parties.
12. The Plaintiff himself stepped into the witness box as PW-1 and placed his affidavit in lieu of evidence as Ex. PW-1/A and placed on record the following documents as given below:
SR. No. Exhibits Nature of Documents
1. Ex. PW-1/1 Plaint (page 1 to 20) and Application
under Order XXXIX Rules 1 and 2
2. Mark PW-1/1 Letter from Defendant no. 20 and 21
dated 01.04.2006 and other documents
filed by the Plaintiff on 18.04.2006 from
pages 01 to 08.
3. Mark PW-1/2 (colly) Additional documents filed by the
Plaintiff on 22.05.2006 and also letters
dated 28.01.2008, 02.04.2008 and the
photographs.
4. Ex. PW-1/2 'Brief' by the Plaintiff dated 16.02.2013
13. I have heard the Plaintiff and perused the record carefully.
14. My findings on the aforesaid issues are as under:
Issue no.1, 2, 3, 4 and 5 are being dealt with under common discussion, for the purpose of convenience.
1. Whether this court has jurisdiction to entertain the present suit in view of Section 132 r/w Section 70 of Delhi Cooperative Societies Act, 2003 and in view of Section 15 of Delhi Apartment Ownership Act, 1986? OPD
2. Whether the Plaintiff has not properly valued the present suit and has not paid the correct court fees?
3. Whether the present suit is not maintainable due to lack of cause of action in favour of Plaintiff? OPD
4. Whether the present suit is not maintainable due to misjoinder of necessary parties? OPD
5. Whether the present suit is not maintainable due to non compliance of the provision of section 129 of Dellhi Cooperative Societies Act, 2003? OPD The onus to prove the aforesaid issues was on the Defendants but no evidence has been led by the Defendants and thus, the Defendants have failed to discharge the onus.
Hence, issue no.1,2,3,4 and 5 are decided in favour of the Plaintiff and against the Defendants.
15. Issue No. 6Whether the Plaintiff is entitled to the reliefs claimed in plaint? OPP The onus to prove the aforesaid issue is on the Plaintiff. It is settled law that even if the suit has been proceeded ex-parte and the testimony of the plaintiff's witnesses has gone unrebutted yet the Plaintiff has to stand on its own legs and prove its own case. The main issue which is to be decided is whether the Association formed under Section 15 of DAO Act has been legally formed and if not, then will the Managing Committee of Amit CGHS continue to govern the management and administration of the said housing complex. Let us now consider each contention of the Plaintiff and appreciate whether it has been able to prove its case or not.
Whether DAO Act is in force or not?
16. The Plaintiff had raised the contention that the Defendants' No. 1 to 19 have formed "Amit Apartments Owners' Association" under repealed statute, "Delhi Apartment Ownership Act, 1986." It is averred by the Plaintiff that it is known to the Defendants' no. 1 to 19 that the rules, bye-laws etc. under Delhi Apartment Ownership Act, 1986 were never notified/published. The Hon'ble Delhi High Court in in Sagar Apartments Flat Owners Society (Regd.) and Ors. v. Sequoia Construction Pvt. Ltd. and Ors 1993 Raj LR 446: 1993 26 DRJ 71 held:
"(15) In Hamdard Davakhana Vs. Union of India, the difference between conditional legislation and delegated legislation was explained. It was held that when the legislation is complete in itself and the legislature has itself made the law and the only question left to the delegate is to apply the law to an area of to determine the time and manner of carrying it into effect, it is conditional legislation. In the case of the Delhi Apartment ownership Act, the legislation was complete in itself. Only the date of its being brought into effect remained to be notified. This date was also notified in 1988. Therefore, nothing remained to be done. Non-appointment of the competent authority under the Act does not make it a conditional legislation.
(16) Sardar Inder Singh Vs. The State of Rajasthan, , The State of Bombay Vs. Narottamdas Jethabhai, Air 1951 Bombay 69 and Emperor Vs. Benoari Lal Sarma, Air 1945 P.C. 48 enunciate the same principle. The test for a conditional legislation is whether the legislation was full and complete when it left the legislative chamber. What remains to be done is not any law making function, but only to execute the legislative will by determining the date and time of enforcement of the Statute, lf: at all the Delhi Apartment Ownership Act was a conditional legislation because the date of its enforcement remained to be notified, the condition stands satisfied with the enforcement of the Statute.
(17) The Delhi Apartment Ownership, Act came into existence in the year 1986. However, this was enforced in the year 1988. Passing of the legislation and enforcing the same clearly shows that the Act is intended to be live wire rather than a dead letter. Merely because the competent authority has not been notified so far, does not render the statute otiose. The Act defines common areas and facilities and as such spells out various things in a multi-storeyed building complex which are covered under the sweep of the definition of common areas and facilities. The effect of non notifying the competent authority can at best be that the Deeds of Apartment can not be executed. This does not mean that by non execution of the deeds of apartment, rights and interests of the apartment owners/allotters are obliterated. The non execution of the deeds of apartments may mean that the exact percentage of the interest of the individual apartment owners in relation to the building complex is not specified. But it can not surely mean that their rights and interest evaporate in thin air."
Hence, in view of the aforesaid, it is clear that the Hon'ble Delhi High Court has held the DAO Act is in force and the rights of the parties created under the aforesaid Act have to be protected. Thus, the contention of the Plaintiff in this regard cannot be sustained.
Whether the DAO Act is applicable to the present case?
17. The Plaintiff has averred that the DAO Act does not apply to Amit CGHS. In order to appreciate the contention, it is important to refer to the provisions of DAO Act. Section 2 of the DAO Act provides that the provisions thereof shall apply to every apartment in a multi-storeyed building constructed for residential or commercial purposes by any group housing society or any other person and whether before or after the commencement of said Act, and on a free hold land or a lease hold land, if the lease for such land is for a period of thirty years or more. The Act applies to all buildings which have four or more apartments. As per the plaintiff himself, Amit CGHS has more than four apartments and the documents show the lease of land underneath the same to be perpetual. Thus, the DAO Act applies to the said building. The purpose of the said Act was to protect the rights of the buyers of the flat and it has been succinctly explained by the Hon'ble Delhi High Court in Sagar Apartments Flat Owners Vs. Sequoia Construction Pvt. Ltd. 51 (supra):
"4. The aforesaid Act was legislated by the Legislature as it was found that existing laws were not sufficient to protect the rights of the buyers of flats/officers etc. in the multistory building where on account of existence of different owners and occupier certain area and facilities were bound to be common which gave rise to disputes between the promoters and the apartment owner and between the apartment owner inter se, which were incapable of being solved by the existing laws. In the aforesaid circumstances, the aforesaid law came into the existence. The effect of the aforesaid Act was only to provide ownership of an individual apartment in a multistory building and of the undivided interest in the common areas and facilities appurtenant to such apartment and to make such apartment and interest heritable and transferable and for matters connected therewith or incidental therewith. Said Act is having overriding effect over terms of the agreement between the builder/promoter and apartment owner but only in respect of those terms which are in conflict with the provisions of the Act."
Whether DCS Act or DAO Act has an overriding effect?
18. An argument was raised by the Plaintiff was that the DAO Act was not applicable to co-operative grouping housing societies and thus, Amit CGHS formed under DSC Act has to be regulated only by DCS Act. He relied on proviso to Section 5 of DAO Act, the same reads as:
"Section 5. Apartment to be heritable and transferable.- Subject to the provisions of section 6, each apartment, together with the undivided interest in the common areas and facilities appurtenant to such apartment, shall, for all purposes constitute as a heritable and transferable immovable property within the meaning of any law for the time being in force, and accordingly, an apartment owner may transfer his apartment and the percentage of undivided interest in the common areas and facilities appurtenant to such apartment by way of sale, mortgage, lease, gift , exchange or in any other manner whatsoever in the same manner, to the same extent and subject to the same rights, privileges obligations, liabilities, investigations, legal proceedings, remedy and to penalty forfeiture or punishment as any other immovable property or make a bequest of three same under the law applicable to the transfer and succession of immovable property;
Provided that where the allotment, sale, or other transfer of any apartment has been made by any group housing co-operative society in favor of any member thereof, the transferability of such apartment and all other matters shall be regulated by the law applicable to such group housing co-operative society."
19. A bare perusal of the proviso to the section reveals that the exception of the applicability of DAO Act is carved out only vis-à-vis transferability of the apartment. The phrase "and all other matters" are to be interpreted ejusdem generis. In the present case, the mooted question is whether the association formed under Section 15 of DAO Act is illegally formed or not and has nothing to do with transferability of any apartment. Hence, proviso to Section 5 does not apply to the present case.
20. Section 24 of the DAO Act, which specifically makes it an overriding Act, stipulates that "The provisions of the Delhi Apartment Ownership Act would have effect notwithstanding anything inconsistent therewith in any other law for the time being in force or in any contract, undertaking or other instruments and all apartment owners, tenants of owners, employees of owners and tenants, or any other person, who may, in any manner, use the property or any part thereof to which the said Act applied, would be subject to the provisions of the said Act and the bye- laws and the rules made thereunder"
Hence, in view of the aforesaid, the DAO Act would have primacy and the DCS Act would cease to apply. Thus, this contention of the Plaintiff is nto sustainable.
Whether any contract can supersede the applicability of DAO Act?
21. The Plaintiff has also pleaded that at the time of granting possession, the Defendant no. 20, Amit CGHS executed a statutory contract with the Plaintiff and its other 131 members under the provision of DCS Act which is still subsisting and valid. Hence, he contended that the the privity of this statutory contract cannot be violated by any third party, least by the Defendant no. 1 to 19 or anyone else. However, this contention of the Plaintiff is also not acceptable. The Hon'ble Delhi High Court in M/S Nehru Place Hotels Ltd. V. M/S. Bhushan Steel & Strips Ltd. 2005 SCC OnLine Del 532 : ILR (2005) 1 Del 650 held:
"26. Whatever may be the terms of agreement, the field is admittedly covered by the statutory provisions. Indisputably, the apartment in question is covered by the provisions of the Act. Therefore, statutory provisions contained in that Act, wherever applicable, shall override the contractual terms stipulated in the Agreement signed between the parties. It is trite law that 'contracting out' is not permissible in a manner which would offend and breach the statutory provisions. To put it simply, there cannot be a clause in the Agreement between the parties which infringes statutory provision and such a clause would clearly be void even if the parties had agreed to the specific terms...
32. As already seen above, as per Section 24 of the Act provisions of the Act are binding on all apartment owners, tenants etc. notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any contract, undertaking or other instrument etc."
Thus, even if there was a contract between the Plaintiff and the Defendant no.20, Amit CGHS, the same ceases to subsist, as Section 24 of DAO has an overriding effect.
Whether non-registration of Deed of Apartment Act can withhold the applicability of the DAO Act?
22. Another argument raised by the Plaintiff was that the Defendants have neither executed nor registered the Deed of Apartment under DAO Act and they do not even have the "separate deeds of sub-lease", thus they are entitled to the benefits of DAO Act. I am unable to agree with this contention of the Plaintiff also. The Hon'ble Delhi High Court in Sagar Apartments Flat Owners Vs. Sequoia Construction Pvt. Ltd. 51 (1993) DLT 308, 1993 (26) DRJ 71, 1993 RLR 446 held:
"(25) The main reason advanced on behalf of defendant No. 1 for non-
application of the provisions of the Delhi Apartment ownership Act is the non-execution of the Deeds of Apartment. In view of the above discussion and particularly for the following reasons.
1.Under the Act the Deeds of Apartment are required to be executed by the promoters of the building;
2.Plaintiffs are in no way responsible for their non execution;
3.Plaintiffs have fully performed their obligation under the Act in as much as they have paid full consideration for their respective apartments;
4.The Act is meant to confer certain rights on the apartment owners and is a legislation for their benefits;
5.Equity demands that even if the Act does not apply, the property be preserved in the status quo condition, till the Act applies. (25) I am of the considered view that the plaintiffs ought not be denied the advantage of the beneficial provisions of the Act The Act is a legislation meant primarily for the protection of the flat buyers from the unscrupulous practices of the builders. The Court should endeavor to uphold this legislative intent. 2. Rights of the plaintiffs' under the license agreements :"
The court had also held that : "...This does not mean that by non execution of the deeds of apartment, rights and interests of the apartment owners/allottersareobliterated..."
Hence, in view of the aforesaid case-law, it is clear that the Defendants cannot be denied the privileges offered by DAO Act, only because the Deed of Apartments have not been registered and executed and the same analogy applies also to the argument raised vis-à-vis separate deed of sub- lease.
Whether Power of Attorney(POA) holders of allottee members can form a legal association under Section 15 DAO Act?
23. The Plaintiff has argued that apart from Defendant No. 5, namely, Sh. R.K. Keswani, all the other 17 are not owners but power of attorney (POA) holders of those allottee members who have sold their flats. Hence, these 17 Defendants have only "possessory rights" of these flat and are not even 'nominal' members of the Amit CGHS, as per provisions of Section 91 of DCS Act. Section 4 of the DAO Act provides that every person to whom any apartment is allotted, sold or otherwise transferred by the promoter shall be entitled to the exclusive ownership and possession of the apartment so allotted, sold or otherwise transferred to him. In the present case, the Plaintiff is admittedly the promoter and the Defendants no.2 to 19 are the persons to whom the allotment, sale or transfer of the flats have been made and who are the owners thereof. Hence, by virtue of Section 4 of DAO Act, which vests ownership rights in favour of such allottees/transferees of apartments/such flats, the Defendants no.2 to 19 are owners, to whom sale have been made by way of power of attorney. Section 15 of DAO Act provides that the administration and management of the affairs of the apartment would be governed by the association of owners, which in the present case is the Association formed under DAO Act. The intention of the said Act was clear that the best watchdog to protect the interest is the association of the owners under the said Act and their interest is to be honoured.
24. In fact, the Hon'ble Delhi High Court O.S Bajpai v. The Administrator (Lt. Governor of Delhi) WP (C) No. 1959 of 2007 decided on May 28, 2010, while dealing with a public interest litigation filed regarding enforcement of the Delhi Apartment Ownership Act,1986 had passed the following directions regarding the Apartment Owners of the association:-
"The competent authority shall send specific notice to all multi-storeyed apartments informing the owners of apartments that it is their right to form owner's association in accordance with the bye-laws as per the Explanation B of Chapter 1 of the said bye-laws under Section 15(2) of the Act. The officials from the office of the competent authority shall be deputed to visit all these multi-storeyed buildings, who would ensure formation of owners' association. They would be authorized to call for the meeting of the owners and supervise the formation of the association, so as to ensure smooth formation of the association. This exercise in respect of multi-storeyed buildings shall be completed within six months and the existing maintenance companies shall transfer the management of the multi-storeyed building to such associations.
c) Transfer of Management, Books of Account, etc. Once the apartment owners' association is formed, it shall take over the management from the promoter/builder. All the books of account, bank account and other documents shall be handed over by the promoter/builder to the apartment owners' association so formed and all functions relating to the management of the building, common area, collection of maintenance charges, expenditure to be incurred on maintenance, employment of manpower, legal compliance, etc. will be performed by the association."
This judgment itself shows that the apartment owners association is to take control over the management and affairs of the apartments. Thus, applying the DAO Act in its true spirit to the facts of the present case, the Association formed under the DAO Act is legally formed and will take over the administration and management over the affairs of the apartments and the Managing Committee formed under DCS Act will have to take a backseat.
Hence, in the present case, the Plaintiff has failed in proving the present issue and cannot be said to be entitled to any relief.
In view of the above discussion, present issue is decided in favour of Defendants and against the Plaintiff.
25. Relief:
In view of the observations made above, suit of the plaintiff is dismissed. The court is also of the opinion that considering the present facts and circumstances of the case, there is no order as to cost. Decree sheet be prepared accordingly.
Application under Order XXXIX Rule 2A stands dismissed, since the Plaintiff failed to bring any evidence to show as to how the order of the court dated 21.04.2006 was violated.
All the other pending applications, if any, are disposed off as not pressed. File be consigned to record room after due compliance.
Pronounced in the open Court on 18.07.2016.
(Sonam Singh ) Civil Judge-05, Central District Tis Hazari Courts,Delhi Present judgment is consists of 46 pages and each page is signed by me.