Andhra Pradesh High Court - Amravati
Vegi Veera Venkata Subrahmanyam, vs The State Of A.P., Repby Its Prl. ... on 27 January, 2020
Author: M. Ganga Rao
Bench: M. Ganga Rao
HONOURABLE SRI JUSTICE M. GANGA RAO
Writ Petition No.13818 of 2016
ORDER:
This writ petition is filed questioning the notice issued by the 2nd respondent under Sections 55 and 120 of the Andhra Pradesh Cooperative Societies Act, 1964 (Act 7 of 1964) by entertaining the suit ARC.No.6/2015-2016 filed by the 4th respondent society under Section 61 of the Andhra Pradesh Cooperative Societies Act, 1964 for cancellation of the registered sale deed dated 29-03-2010 and 30-03-2013 executed by the 4th respondent society in favour of the petitioners, pursuant to the auction sale in favour of the petitioner's father as being arbitrary, illegal and contrary to the provisions of the Andhra Pradesh Cooperative Societies Act (Act 7 of 1964).
The undisputed facts, which are relevant to decide the lis in this writ petition are that the 4th respondent house building society (hereinafter called as 'the society') is a registered society under the provisions of Act 7 of 1964 and got allotted the land in Survey Nos.653 to 683 of Allipuram ward, within the limits of Visakhapatnam Municipal Corporation. The said land was developed as per layout plan and plotted by the society. The plots were allotted to its members. The society had conducted a public auction of the unsold/ unallotted plots on 29-10-1972. The father of the 1st petitioner Sri Vegi Venkateswara Rao was a successful bidder of Plot No.V-B admeasuring 2353 sq.yds. and paid entire sale consideration of Rs.15,544/- vide receipt No.244 dated 14-08-1975 and he was given possession of the plot. Subsequently, the plot was allotted to the 1st petitioner on the request of Sri Vegi Venkateswara Rao as per 2 MGR, J W.P.No.13818 of 2016 Resolution No.17 (A) dated 27-01-1979 as his other two sons are minors by then. After two brothers of the 1st petitioner became majors and admitted as members of the society. The Plot No.V-B in T.S.No.654 was got divided into three units admeasuring 785 sq.yds. each as Plot No.V-B Part-I, was reallotted to 1st petitioner and his wife 2nd petitioner. Likewise, Plot No.V-B-Part-II was re- allotted to the 3rd and 4th petitioners and Plot No.V-B Part III was re- allotted to the 5th petitioner by the society on 09-04-1996. The petitioners got constructed A.C. sheet houses in their respective plots and had been in uninterrupted possession and enjoyment thereof with absolute rights. As the petitioners intended to get registered the plots in their names the society on payment of further amount of Rs.5,181.33 each, the plots were registered in the name of petitioners on 29-03-2010 and 30-03-2013 by registered sale documents No.1418/2010 Document No.3893/2013 respectively, now which are sought to be cancelled by the society by filing suit before the 2nd respondent Arbitrator under Section 61 of the Act and thereon notice ARC No.6/2015-2016 dated 19-04-2016 was issued to the petitioner for their appearance and defend the suit. The said notice is being challenged in this writ petition.
The issues that are raised in this writ petition for consideration of this court are thus;
1) Whether the dispute raised in the suit comes within the purview of the provisions of Section 61 of the Act?
3 MGR, J W.P.No.13818 of 2016
2) Whether the 2nd respondent Arbitrator has power to entertain the suit to cancel the registered sale deed executed in favour of the petitioner?
Sri N. Subba Rao, learned counsel appearing for the petitioners would contend that the act of executing registered sale deed in pursuance of auction purchase by the petitioner's father in favour of the petitioners does not fall under the enumerated dispute under the provisions of Section 61 of the Act, as the dispute does not arise out of business of the society. As it is not the business of the society to sale and registered plots. The society's business is to get allot the land, develop the land, plot it and allot to its members as per bye laws of the society and the provisions of the Act, but not otherwise. Hence, the dispute raised by the society before the 2nd respondent Arbitrator under Section 61 of the Act for cancellation of registered sale deeds executed in favour of the petitioners does not come within the purview of the dispute touching the constitution, management or the business of a society, in support of his contention the learned counsel for the petitioner placed reliance on the decision of this court in M. Venkata Ramana and another v. A.P. Cooperative Tribunal, Hyderabad1. Hence, issuance of the impugned notice by the 2nd respondent Arbitrator to the petitioner is without jurisdiction, arbitrary, illegal and is liable to be set aside.
Heard the learned Government Pleader for Cooperation, learned Government Pleader for Agriculture and the learned Government Pleader for Housing.
1 2010 (4) ALT 34 (DB) 4 MGR, J W.P.No.13818 of 2016 Learned Government Pleader, while reiterating the averments of the counter would contend that the dispute raised in the suit filed by the society before the 2nd respondent under Section 61 of the Act, for cancellation of registered sale deed, touching the business of the society, between the society and post committee. As per the explanation of Section 61 (iii) of the Act, the dispute shall include a claim by a society against a member, past member, or the nominee, heir or legal representative of a deceased member for the delivery of possession to the society of land or other immovable property resumed by it for breach of the conditions of assignment or allotment of such land or other immovable property. It is evident that the sale deeds which are executed in favour of the petitioners in the year 2010 and 2013 are nothing but undue favour to the petitioners, contrary to the bye-laws of the society and the provisions of the Act. Hence, the issue raised in ARC.No.6/2015-2016 is touching the business of the society, the 2nd respondent Arbitrator has authority and jurisdiction to decide the claims raised in the suit. Hence, the issuance of impugned notice could not be said to be arbitrary, illegal and contrary to the provisions of the Act. The writ petition is devoid of any merits and is liable to be dismissed.
In the facts and circumstances of the case, considering the submissions of the counsel and on perusal of the record, this court came to the conclusion that the dispute which falls within the purview of the provisions of Section 61 of the Act, alone shall be referred to the 2nd respondent Arbitrator for adjudication of claim. To know what type of disputes falls under the purview of the provisions of Section 61 of the 5 MGR, J W.P.No.13818 of 2016 Act, it is profitable to extract the provisions of Section 61 of the Act, which reads thus:
61. Disputes which may be referred to the Registrar. - (1) Notwithstanding anything in any law for the time being in force, if any dispute touching the constitution, management or the business of a society, other than a dispute regarding disciplinary action taken by the society or its committee against a paid employee of the society, arises-
(a) among members, past members and persons claiming through members, past members and deceased members ; or
(b) between a member, past member or person claiming through a member, past member or deceased member and the society, its committee or any officer, agent or employee of the society ; 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 nominee, heir or legal representative of any deceased officer, deceased agent or deceased employee of the society ; or
(d) between the society and any other society, such dispute shall be referred to the Registrar for decision.
Explanation: - For the purposes of this sub-section a dispute shall include-
(i) a claim by a society for any debt or other amount due to it from a member, past member, the nominee, heir or legal representative of a deceased member, whether such debt or other amount be admitted or not;
(ii) a claim by surety against the principal debtor where the society has recovered from the surety any amount in respect of any debt or other amount due to it from the principal debtor as a result of the default of the principal debtor whether such debt or other amount due to be admitted or not;
(iii) a claim by a society against a member, past member, or the nominee, heir or legal representative of a deceased member for the delivery of possession to the society of land or other immovable property resumed by it for breach of the conditions of assignment or allotment of such land or other immovable property ;
[x x x] (2) If any question arises whether a dispute referred to the Registrar under this section is a dispute touching the constitution, management or the business of a society, such question shall be decided by the Registrar.
[(3) Every dispute relating to, or in connection with, any election to a committee of a society shall be referred for decision to the Tribunal having jurisdiction over the place where the main office of the society is situated, whose decision thereon shall be final.] (4) Every dispute relating to, or in connection with any election [shall be referred under] sub-section (3) only after the date of declaration of the result of such election.] A reading of the provisions of Section 61 of the Act makes it clear that if any dispute touching the constitution, management or 6 MGR, J W.P.No.13818 of 2016 the business of a society other than a dispute regarding disciplinary action taken by the society or its committee against a paid employee of the society, arises among members, past members and persons claiming through members, shall be referred to the Registrar for decision. A further perusal of the notice issued by the Arbitrator under Sections 55 and 120 of the Act also makes it clear that the 4th respondent had filed suit in ARC.No.6/2015-2016 under Section 61 of the Act with regard to division of Plot No.V-B in three equal parts and re-allotment of the same in favour of the petitioners. The dispute before the 2nd respondent-Deputy Registrar is that the petitioner society came to know that the 1st respondent therein in collusion with the petitioner without following the Rules and Regulations and Bye- laws of the society and the provisions of the Cooperative Societies Act, divided Plot No.V-B into three parts and transferred the same by re-allotment through various registered sale deeds, and hence, the 4th respondent filed the suit for declaration of division of Plot V-B and transferring through registered sale deeds in favour of the petitioners as null and void and for cancellation of the registered sale deeds.
The dispute herein pertains to division of Plot V-B into three equal parts and transfer of the same in favour of the petitioners herein without following the Rules and Regulations and without the consent to the Board Members of the 4th respondent society. The division of the Plot V-B into three parts and registration of the same in favour of the petitioners through registered sale deeds do not form part of the business of the society and the same cannot be termed as one touching the business of the society within the meaning of 7 MGR, J W.P.No.13818 of 2016 Section 61 (1) of the Act. The word 'business' cannot be construed so as to include any illegal transaction of the society or its members purporting to act as members of the society violating any statutory provisions and entering into a transaction, when such transaction cannot be treated as part of business of the society. Since the dispute involved herein is not one touching the constitution, management or the business of the society, and the dispute is outside the purview of Section 61 of the Act, the 2nd respondent- Deputy Registrar has no power or authority to entertain the dispute and hence, the contention of the learned counsel for the petitioners that the 2nd respondent-Deputy Registrar has no authority to entertain the dispute is sustainable in law in view of the decision of this court in the case of M. Venkata Ramana and another v. A.P. Cooperative Tribunal, Hyderabad, wherein it is held as follows:
".......As rightly contended by the learned counsel for the petitioners that the genuineness or otherwise of the sale deeds, the identity and nature of the land in dispute, whether the alienations are liable to be set aside and the sale deeds are liable for cancellation, and whether the constructions made by the petitioners on the disputed land are liable to be demolished or not, are all matters, which are outside the scope of Section 61 of the Act, as they do not relate to 'business of the society', which can be referred to and adjudicated upon by the Arbitrator. When once, the sale deeds are executed and registered, title in the property covered by the sale deeds gets legally transferred in favour of the vendees and even the vendor cannot unilaterally cancel the same. In case the transaction is found to be illegal and beyond the authority of the society, necessary recourse has to be taken to the provisions of the Specific Relief Act, which provides for cancellation of documents and decrees....."
8 MGR, J W.P.No.13818 of 2016 Having regard to the facts and circumstances of the case and considering the submissions made by the counsel for the parties and on perusal of the record, this court found that the suit filed by the 4th respondent under Section 61 of the Act before the 2nd respondent for cancellation of sale deed is outside the purview of the provisions of Section 61 of the Act and hence, the 2nd respondent lacks inherent jurisdiction to decide the issue for cancellation of the sale deeds. Hence, the issuance of impugned notice to the petitioners is arbitrary, illegal and contrary to the provisions of the Act and liable to be set aside. The only remedy left to the 4th respondent is to approach the competent Civil Court for redressal of its grievance in accordance with law. Accordingly, the issues answered in favour of the petitioners.
In view of the above discussion, the writ petition is allowed by setting aside the impugned notice. No costs.
As a sequel thereto, miscellaneous petitions, if any, pending shall stand closed.
________________ M. GANGA RAO, J Date: 27-01-2020 Ksn 9 MGR, J W.P.No.13818 of 2016 HONOURABLE SRI JUSTICE M. GANGA RAO Writ Petition No.13818 of 2016 27th January 2020 Ksn