Punjab-Haryana High Court
Capt. A.K. Mahindra And Ors. vs State Of Haryana And Ors. on 24 August, 2007
Equivalent citations: (2007)4PLR177
JUDGMENT Arvind Kumar, J.
1. Both the above referred petitions filed under Articles 226/227 of the Constitution of India pray for quashing of orders dated 13.12.2002, 5.9.2003, Annexures P-7 and P-9 respectively passed by Assistant Registrar, Cooperative Societies, Gurgaon exercising the powers of Registrar of the Cooperative Societies, Haryana, Chandigarh and the order dated 19.11.2004 (Annexure P-22) passed by the Deputy Registrar, Cooperative Societies, Gurgaon. The petitioners have further sought for quashing of decision taken by the Registrar, Cooperative Societies, Haryana regarding grant of permission to dispose of the land of the Mount Everest Cooperative House Building Society Limited (for brevity, 'the Society') and all other subsequent actions undertaken by the respondents, including the sale of land of the Society to respondent No. 7.
2. It is apposite to mention here that the petitioners in both the writ petitions are the members of one Society, aforesaid and are behaving common interest. Both the writ petitions have been filed on the similar grounds and even the pleadings filed by the respondents in reply to the petitions, are also identical in both the petitions, except the additional plea taken by the petitioners of C.W.P. No. 7742 of 2005, to get the matter enquired into by an independent agency or Central Bureau of Investigation, and, therefore, are being disposed of by this common judgment passed in C.W.P. No. 6491 of 2005.
3. The facts of the case of the petitioners, as arises out from the petitions, are that they are Members of the Society and for the purpose and object of providing plots to its Members, the Society purchased 10 acres 4 kanal and 14 marlas of land in village Wiz-arabad as well as Hyderpur in the year 1995-96 by spending a sum of Rs. 2.62 crores approximately. It appears that there was some dispute with regard to the financial irregularities being meted out at the hands of the then Managing Committee of the Society, as a consequence thereof on 28.5.2000, a General Body Meeting of the Society was called and a new Managing Committee came into existence after the elections with Dr. P.C. Bansal as its President; R.P. Gupta as Secretary; K.P. Singh as Treasurer while Capt. A.K. Mahindra (petitioner No. 1), K.C. Ganjwal, V.P. Bhardwaj and V.K. Madan as Members of the Executive Committee. According to petitioner No. 1, he was elected as Member of the new Managing Committee, for the first time and subsequently in October 2001 he was entrusted with the work of Honorary Secretary of the Society in place of R.P. Gupta. It is the further case of the petitioners that the records and accounts of the Society were probed into by the internal committee of the Society as well as by the Audit Team of the Cooperative Department and, as apprehended, many glaring discrepancies coupled with financial irregularities and embezzlement were found therein, committed by the then Managing Committee. Thus, at the behest of the new Managing Committee an F.I.R. was got lodged against the erstwhile Members of the Managing Committee of the Society.
4. Thereafter, keeping in view the financial irregularities and other constraints and in the interest of members of the Society, on 2.6.2002, in the General Body Meeting held by the Members of the Society, it was decided to dispose of the land of the Society and to disburse the money, so received, amongst all the members, in lieu of contribution made by them while beginning the Society. Accordingly, petitioner No. 1 and respondent No. 5 Ashok Sharma, who was the Treasurer of the Society, were authorized for carrying out necessary proceedings in that regard. Accordingly, vide letter dated 7.7.2002, permission was sought from the Registrar Cooperative Societies, Haryana.
5. It is further case of the petitioners that instead of granting permission to sell the land, respondent No. 4, without affording an opportunity of being heard either to the Members of the Society, as prescribed under Section 34(1) of the Haryana Cooperative Societies Act, 1984 (for short, the Act), on 13.12.2002 passed an order Annexure P-7 under Section 34(2) of the Act ibid and thereby suspended the new Managing Committee of the Society on the allegations of gross negligence and serious irregularities and further, without apprising them, appointed a Board of Administrators, comprising three Officers of the Cooperative Societies, Gurgaon and Ashok Kumar and Shishir Moudgil to look into the affairs of the Society and allegedly served the notice on Dr. Bansal, who was the President of the Society and had since resigned from the post by then. It has also been pleaded that while passing the order dated 13.12.2002 the Assistant Registrar lost sight of the fact that the alleged financial irregularities were pertaining to the tenure of erstwhile Managing Committee and that the induction of Ashok Kumar (respondent No. 5) and Shishir Moudgil, who is stationed at Singapore, as Members of the Board of Administrator is without rationale and not in the interest of the Society. According to the petitioners the constitution of Board of Administrator is a tainted exercise, just to provide benefit to respondents No. 5 and 7. In the meantime on 14.1.2003 the permission to dispose of the land of the Society was granted by the Registrar of Cooperative Societies, Haryana and accordingly the Deputy Registrar, Cooperative Societies, Gurgaon formed a Sales Committee for selling the land of the Society, in which also Ashok Kumar and Shishir Moudgil were the Members. Dissatisfied with the same, petitioner No. 1 and some other members of the society approached this Court by way of filing C.W.P. No. 20252 of 2003 and challenged the order of suspension of new Managing Committee as well as the order granting permission to sell their land and also prayed for quashing of sale in favour of respondent No. 7, being carried out by the Sales Committee. It is further case of the petitioners that no intimation regarding appointment of Sales Committee was ever given to the new Managing Committee and after the constitution of Board of Administrators and till removal of the new Managing Committee, no efforts were made by the Board of Administrators to hold the elections of the Society.
6. It is further case of the petitioners that during the pendency of the aforesaid writ, the Assistant Registrar, Cooperative Societies, Gurgaon passed an order dated 5.9.2003 and thereby removed the new Managing Committee of the Society. Respondents No. 4s 5 and 7 hatched a criminal conspiracy and in a clandestine and hasty manner, without adopting due procedure and prejudicial to the interest of the Members of the Society, sold the land to Respondent No. 7 at a throw-away prices of Rs. 4.94 crores on 22.11.2003. It is the case of the petitioners that alleged auction in favour of respondent, No. 7 was pre-determined, as respondent No. 7 got prepared the demand drafts of Rs. 4.90 crores, almost near the amount on which the alleged auction was finalized in its favour, prior to two days of auction i.e. on 22.11.2003, against the requisite security/demanded amount of Rs. 50 lacs. According to the petitioners, all the proceeding were done in a hasty manner and that the land of the Society was actually carrying the rate with manifold increase from that for which it was allegedly sold to respondent No. 7, since the rate of land in the adjoining are is much more. The sale deed was executed on the same date of auction i.e.24.11.2003, by seeking waiver of purchase of stamp duty from the Deputy Commissioner, besides the delivery of possession of the land on the same day to respondent No. 7. It is further the case of the petitioners that Ashok Kumar was well aware of decision taken in the General Body Meeting of the Society to dispose of the land and thus taking advantage of the same, he in collusion with respondent No. 7 designed a well planned scheme and got the new Managing Committee suspended and ultimately removed and succeeded in selling the land of the Society as per his own whims and wishes.
7. Thereafter, the writ petition No. 20252 of 2003 filed by the petitioners was withdrawn with a liberty to avail all the existing alternative remedy available to the petitioners by filing an appeal under Section 114 of the Act and in compliance thereto, the petitioners challenged the order dated 13.12.2002 and 5.9.2003 passed by the Assistant Registrar by filing an appeal before the Deputy Registrar under Section 114 of the Act, but the same was dismissed by the Deputy Registrar vide order dated 19.11.2004 (Annexure P-22). Hence this writ petition.
8. Upon notice, the respondent put in appearance and filed their written statements.
9. The stand taken by respondents No. 1, 2, 4 and 6 in their joint written statements filed separately in both the petitions, is that the petitions are not maintainable. As per the Haryana Cooperative Societies Act, 1984, there is a provision to challenge the order passed by the Deputy Registrar in appeal under Section 114 of the Act and that remedy has not been availed by the petitioners, Moreover, the petitioners had challenged the order of the Deputy Registrar in their petition and have also raised the issue relating to the sale of land, which cannot be clubbed with the order passed by the Deputy Registrar in an appeal under Section 114 of the Act. According to the answering respondents, the election of the Managing Committee as well as the office bearers has been held, on 5.12.2004 and 9.1.2005 respectively, in which Shishir Moudgil has been appointed as President while Ashok Sharma has been elected as Vice President, as such, the instant petitions have rendered anfractuous. It has further been asserted that on account of various irregularities, which were prejudicial to the rights of its members, the Managing Committee of the Society was suspended and a show cause notice dated 13.12.2002 was served to explain the position regarding the same, but it was not replied by the Society. On finding that the earlier Managing Committee as well as the new Committee headed by petitioner No. 1 are involved in committing embezzlement/misappropriation of funds etc. the Assistant Registrar, Cooperative Societies, Gurgaon invoking the provisions of Section 33 read with Section 34 of the Act, removed the Managing Committee of the Society vide order dated 5.9.2003 and accordingly appointed the Board of Administrators to manage the affairs of the Society. It has also been averred that findings that the aim and object of the Society of developing a residential colony is not fulfilled, it was the decision of the General Body of the Society, which vide Resolution dated 2.6.2002 resolved to sell the land and they also wrote a letter to the competent authority under the Signatures of petitioner No. 1 for obtaining necessary permission and the petitioner also sought the prevailing market rate of the land from Tehsildar Gurgaon, who quoted the value of land @ Rs. 40 lacs per acre. Keeping in view the bungling going on in the Society, respondent No. 2 granted the permission to sell the land and also constituted a Sales Committee for the purpose, which accordingly, after due publication and adopting due procedure, sold out the land in an open auction to respondent No. 7, being the highest bidder and has offered much more than the value quoted by the Tehsildar Gurgaon as well as petitioner A.K. Mahindra, as market value of the land. With regard to inclusion of Ashok Kumar and Shishir Moudgil, it has been averred that the answering respondents have acted to protect the interest of the Members of the Society and there is no foul played by them, in hand in glove with other respondents, as alleged by the petitioners, to grab the land of the Society. All precautions were taken to have free and fair public auction of the land of the Society.
10. It is further submitted that the scope of appeal under Section 114 of the Act before respondent No. 6 was only to the extent of orders passed by respondent No. 4 regarding suspension, removal of Managing Committee and appointment of Board of Administrators and respondent No. 6 cannot traverse the scope of appeal, so far as issue regarding the sale of land to respondent No. 7 is concerned.
11. In the written statements filed on behalf of respondent No. 7 Vipul Infrastructure Developers Private Limited, who has purchased the land of the Society, it has been averred that it was the decision of Managing Committee of the Society, headed by the petitioner No. 1 to sell the land and it was he (petitioner No. 1) who sought the permission to sell the land for Rs. 4.2 crores, from the Cooperative Department and ultimately the auction took place under the provision and control of the officers of the Cooperative, Department. It has further been averred that the petitioners concealed the market value of the land given by Tehsildar Gurgaon @ Rs. 40 lacs per acre on the application of the petitioner No. 1 itself and that the land in question was agricultural land falling under unlicensed category and cannot be equated with the comparative price list dated 31.5.2001, which relates to licensed area or approved colonies, carrying higher prices. Even the petitioners did not deliberately implead the answering respondent as party in the appeal filed before the Deputy registrar. According to respondent No. 7 all the proceedings relating to auction of the land in question were carried out properly and being the highest bidder the sale deed was executed and registered in their favour and they were given the possession of the land. Thus, they are bonafide purchaser and unnecessarily dragged into present litigation, without there being any fault on their part. Moreover, for the redressal of their grievance qua the sale of the land and that the General Body Meeting and its Elections have not been held, they can get these disputes referred to the Arbitrator. Moreover, the land purchased by the answering respondent in the auction is no longer in their possession in its entirety and some of its portion has been transferred in favour of "The Saraswati Kunj Coop. House Building Society Limited.
12. Respondent No. 3 also filed written statements on the same grounds, as taken by respondents No. 1, 2, 4 and 6. However, additionally, it has been pleaded that the present writ petition against the Cooperative Society is not maintainable. The disputes raised by the petitioners are required to be referred to the Arbitrator of the Registrar for decision and no Court has jurisdiction to entertain any other proceedings in respect of the "said disputes. It was conscious decision of the Managing Committee of the Society to dispose of the land and accordingly permission was given by appointing the Sales Committee in accordance with rules. It is further submitted that most of the petitioners have already received their refund realized from the auction of the land of the Society in the month of November 2004 and as such, they are precluded from filing the present writ' petition.
13. Respondent No. 5 also filed the written statement separately. Apart from justifying all the proceedings carried out by die respondents right from suspending the Managing Committee of the Society uptil the land sold and mutated in favour of respondent No. 7, it has been pleaded that petitioner No. 1 and other members of the Society earlier filed C.W.P. No. 20252 of 2003 wherein apart from the prayer for quashing the suspension order dated 13.12.2002, it has been prayed that sale of the land of Society being carried out by Sales Committee be set aside and that writ petition was dismissed by this Court and as such, the instant writ petition is barred by principle of resjudicata.
14. The petitioners filed separate replications to the written statements of the respondents, in the manner enumerated in the above paras and denied the contents thereof and reiterated that of the petitions.
15. I have heard learned Counsel for the parties at length and have also gone through the paper-books carefully, which has become voluminous on account of the pleadings and documents appended therewith, filed on behalf of the respective parties.
16. The present petitioners have challenged the suspension order dated 13.12.2002 (Annexure P-7), removal order dated 5.9.2003 (Annexure P-9) passed by Assistant Registrar, Cooperative Societies, Gurgaon and also the order of the appellate authority i.e. Deputy Registrar dated 19.11.2004 dismissing the appeal and of course the main grouse of the petitioners is with regard to the sale/auction of their land in favour of respondent No. 7 held on 24.11.2003. On the contrary, the respondents have raised the preliminary objections as to the locus-standi of the petitioners to file the instant petitions; concealment of material facts; the instant petitions being barred by resjudicata and that the petitioners have not availed appropriate remedy of revision before the competent authority, as provided under the Act, prior to invoke the jurisdiction of this Court.
17. At the very threshold, this Court has no hesitation to comment that the challenge of the petitioners to the orders Annexure P-7 & P-9 is no more alive, since, admittedly, a new election of the Managing Committee of the Society has already been held on 5.12.2004 in which, as conceded by learned Counsel for the parties, petitioner No. 1 Capt. A.K. Mahindra has also been inducted as one of the Members of the Managing Committee of the Society, The counsel for the respondent has referred to Siri Chand, Sarpanch v. State of Haryana (1994-1)106 P.L.R. 149, wherein the suspension of Sarpach was affirmed by the Competent Authority. In the writ petition, the suspension was stayed as a interim measure but during the pendency of the writ petition, fresh elections had taken place and accordingly it was observed that writ petition has become anfractuous by lapse of time. Similarly in the instant case, upon confirmation of the new Managing Committee, the grievance of the petitioners qua suspension and that of removal of the earlier Managing Committee, does not sustain any more.
18. That apart, on merits also, there is no substance in the case of the petitioners, so far as challenge to orders Annexure P-7 and P-9 is concerned. To challenge the suspension order (Annexure P-7), it has been argued by learned Counsel for the petitioners that pendency of proceedings under Section 34(1) of the Act for removal of the Committee is sine qua non for invoking the jurisdiction to suspend a member or a committee under Section 34(2) of the Act and has developed the argument that in this case no proceedings for the removal of the committee were pending when the suspension order was passed. He further argued that no show cause notice to the members of the society was issued nor any opportunity of hearing was afforded. In support of his argument, learned Counsel has referred to Veerpal Singh v. The Registrar Cooperative Societies, U.P. and Ors. , S.R. Goyal v. Mehtab Singh, Deputy Registrar (1994-2) 107 P.L.R. 290 and Lakhmnder Singh v. State of Punjab 2001 (3) R.C.R. (Civil) 549. There is no dispute to the proposition of law that if no proceedings are pending for the removal of committee under Section 34(1) of the Act, then the order suspending the committee cannot be passed because the order of suspension can be operated only during the pendency of removal proceedings. However, this legal position is of no help to the petitioner in the given facts of the present case. It deserves highlighting that suspension is only one of that intermediary steps to be an emergent or urgent nature which may well be necessitated upon the authority being satisfied that the same is necessary in the interest of Co-operative Society. In the instant case, the Assistant Registrar, Cooperative Society exercising the powers of Registrar, on the basis of the report of the Inspector, Cooperative Societies was apprised of the fact that there had an embezzlement worth crores of rupees from the funds of the Society for the period 28.9.1993 to 31.3.2001 and thus by giving the details of the same in the impugned order, as was imperative upon him, he suspended the managing committee of the Society and appointed the Board of Administrators. A close look to the order Annexure P-7 shows that before the suspending the Managing Committee and appointing the Board of Administrator of Cooperative Society, the Assistant Registrar opined that for all the embezzlement the Management of the Society is responsible for which he had sought the reply from the Society, to be submitted within 15 days. This implies that before the order of suspension was passed, he initiated the proceedings for the super-session of the Committee. In the context of such an urgent or emergent action, the requirement of principles of natural justice i.e. the service of the show cause notice; seeking reply and opportunity of hearing or leading evidence may well in fact lead to defeating the very purpose of an emergent provision of this nature. If that be so, it is equally well settled that a construction which would tend to defeat rather than advance the intent of the legislature has inevitably to be avoided.
19. The argument that the show cause notice was to be sent to every member of the Society does not find favour since the Managing Committee was to be suspended and as such, the show cause notice to the Managing committee was only required to be sent, which actually has been done in the instant case, as is apparent from the impugned order dated 13.12.2002. No doubt the mode of delivery is not mentioned in the impugned order, but it does not necessarily to he through a registered post and even hand delivery is permissible under Rule 111 of the Haryana Cooperative Societies Act, 1989. The argument of the counsel for the petitioner that in the order of removal dated 5.9.2003 (Annexure P-9) there is no reference of any embezzlement having been committed by the Committee and thus, the order is without application of mind, is again not tenable, for the reason that the order of suspension merges in the order of removal. A close look to the order Annexure P-9 shows that the authority has referred to the allegations contained in order of suspension dated 13.12.2002 and while removing the Managing Committee of the Society also took into account the fact that no reply to the notice containing said allegations was filed by the Managing Committee. This, leads to the conclusion that the authority had gone through the allegations contained in the suspension order and since the Managing Committee had not replied to the show cause notice, the order of the removal was passed by observing that the Managing Committee of the Society has failed to perform its statutory duty imposed upon it, which obviously tantamount to the application of mind by the competent authority before passing the said order.
20. In nutshell, on merits also, no illegality or perversity could be found in Orders Annexure P-7 and P-9, which were passed in the interest of members of the Society, who have fallen prey to the evil designs of the Members of the Managing Committee.
Much has been said about the sale/auction of the land. The grievance of the petitioners is that the entire auction proceedings were hush-hush affair and the land has been auctioned at a much lower rate than what existed at the relevant time, in collusion with A.S. Dagar, the then Assistant Registrar, Cooperative Societies, Gurgaon, respondent No. 8 and of course with respondents No. 5 and 7. But, frankly speaking, there are legal hurdles to interfere therewith. First, the issue involved in a disputed question of fact, which cannot be subject matter of writ under Article 226 of the Constitution of India. A reference has also been made to Anil Kumar Srivastava v. State of U.P. and Anr. , wherein it was a case relating to "Reserve Price", "Upset Price" in a public auction and the Hon'ble Supreme Court held that such like valuation are question of fact and the court is always reluctant to interfere where valuation is based on relevant material. It had also followed the case of Tata Cellular v. Union of India 1994 (5) S.C.C. 651, wherein while discussing the scope of judicial review, it was held that the Court do not sit in appeal. It has also been observed that the Court cannot substitute its own decision as it has no expertise to correct the decision. Secondly, Mr. A.K. Mahindra, petitioner No. 1 along with 11 others initially filed a writ petition bearing No. 20252 of 2003. Through the factum of sale was also under challenge therein but while issuing notice of motion of 20.12.2003, the sole contention that was raised by the counsel for the petitioner was with regard to suspension from the managing committee, without initiating any removal proceedings and no issue qua the sale of the land in question was raised. Moreover, this Court vide order dated 18.3.2004 while granting liberty to the petitioners therein to avail the alternative statutory remedy of appeal against the removal order Annexure R-12/1 dated 5.9,2003 and other subsequent orders, as provided under Section 114 of the Haryana Cooperative Societies Act, 1984, ordered for dismissal of the writ petition, treating it to be withdrawn. This leads to an inference that no liberty or right was granted to challenge any order prior to 5.9.2003 including order dated 14.1.2003 by virtue of which necessary permission was accorded by the Registrar, Cooperative Societies, Haryana to sell the land in question. However, for the sake of brevity, if it is assumed that this Court was never intended to pass such a conservative order, but when the appeal pursuant to the said liberty was preferred, it was only by A.K. Mahindra and not by any other member. Even no other member was associated, who preferred the earlier writ petition, for which a serious objection has been raised by the respondents that many of the petitioners were not the party in the earlier writ petition and have no locus standi to challenge the order of removal or sale of the land of the society and the remedy of revision was not availed. Even if these objections are not taken care of, since it was only A.K. Mahindra who was pursuing the matter for and on behalf of the society, however, there had been inherent lacunae in presentation of appeal before the appropriate authority under the Act. The Hon'ble Supreme Court in Surinder Singh v. Central Government and Ors. , has observed that the copy of the order, under challenge, must be annexed, enabling the appropriate authority to ascertain the reasons and to pass appropriate order and in absence of it, it is improper to quash the order. In the instant case, Capt. A.K. Mahindra, at the time of preferring an appeal though has challenged the sale/auction, but neither challenged the order of the Registrar, giving approval to sell/auction nor annexed the same, so as the sale deed in question. So much so, the auction purchaser i.e. respondent No. 7, against whom the present petitioners are alleging grievance was not made party in the appeal. Therefore, under the circumstances, when they were especially relegated to the authorities under the Act, the appeal was bad for mis-joinder of necessary parties and also for non-impugning the relevant orders, which the petitioners wanted to challenge and as such, now they are precluded to challenge the same in the present writ petitions. Thirdly, it is admitted that the decision to sell the land was of the General Body of the Society, taken in its meeting held on 2.6.2002. The Society is not under the control or managed by the State. It is managed by a Managing Committee which is selected in accordance with the Act, Rules and the Bye-laws. Thus, the decision was not of the authority constituted under the Act. This rightly led appellate Authority to hold as follows:
The issue of sale which has been raised by the appellant, according to the above in that regard, it is clear that the proceedings of sale has been completed as per rules while complying with the directions imposed by the Registrar, for sale, by the Sale-Committee constituted by the Registrar. So long as this averment of the appellant. is concerned that the appointment of administrative board in the Society made for the purpose of sale of Society's land does not appear to be proper, because the appointment of administrative board and sale are two different procedures and the appointment of administrative board does not prove any purpose of sale of land of the society. The decision of sale of the land of the society is the decision taken in the interest of the members of the Society by the highest body of the Society viz General Body and not by the administrative board. Besides that, the entire proceedings of sale has been completed by the Sale Committee constituted by the Registrar and not by the administrative board.
After hearing the arguments of both the parties on this issue, I think that the present appeal by the appellant has been filed under Section 114 of the Haryana Cooperative Societies Act, 1984 mainly against the suspension of administrative board by the Assistant Registrar, Cooperative Societies, Gurgaon not against the sale of land of the Society.
21. A bare perusal of the impugned order Annexure P-22 passed by the appellate authority, shows that each and every ground raised by the petitioner while laying challenge to the orders Annexure P-7 and P-9 have been discussed therein. This Court is not inclined to interfere therewith, which is accordingly affirmed.
22. Now let us come to the factum of sale/auction of the land in question. It appears from record that in order to cope up with the situation prevalent at that time, like decreasing trend in market value paucity of funds, litigation which was pending in respect of the suit land; the land in question having irregular shape and apprehension of acquisition thereof by the Government, the highest body of the Society i.e. General Body in its meeting held on 2.6.2002, considering the interest of Members, decided to dispose of the land at the best reasonable price and accordingly authorized Ashok Sharma, Treasurer and A.K. Mahindra, who was acting as Honorary Secretary to initiate the proceedings for the disposal of the land. If further reveals that one of the petitioner A.K. Mahindra, in order to ascertain the correct market rate of the land, thereafter himself wrote letter Annexure R-7/1 to the Tehsildar, Gurgaon, seeking the market rate of the agricultural land, situated in the revenue estate of Wazirabad, which were prevalent at that time, upon which the Tehsildar Gurgaon vide Endorsement dated 14.6.2002 assessed the market value of the land relating to the khasra numbers, which were quoted in the application to be Rs. 40 lacs per acre. Consequently, Capt. A.K. Mahindra, who as said above, was authorised to initiate the proceedings for disposal of the land in question, after satisfying himself about the market rate, then wrote a letter to the Registrar, Cooperative Societies, Haryana vide Annexure R7/2 on 2.7.2002 and by quoting the market rate of the land in the area, where the land of the Society is situated as Rs. 40 lacs per acre, as obtained by them from the concerned Patwari sought the permission to dispose of the land for Rs. 4.2 crores, at the earliest. Not only this the Society even pursued the said decision with the Registrar, Cooperative Societies, Haryana for seeking necessary permission and also by giving indication about the completion of necessary formalities. Ultimately, this led the Registrar, Cooperative Societies, Haryana to give permission while constituting a Sales Committee and laying certain conditions on the auction of the land viz. that the advertisement be published in three popular newspaper of Hindi and English, before fixing the minimum rate of the land; the rate shall be fixed after inspecting the position of the land as well as after obtaining rates from Tehsildar and the prices of land, so received should be paid through bank drafts and then amount be distributed amongst the members, except those members against whom surcharge is pending, till the decision of the case and their amount should be kept reserved. In compliance of the said orders, rates were obtained from the Tehsildar, who vide endorsement dated 16.6.2003 opined the same to be Rs. 40 lacs per acre. The advertisement were made in the newspaper for auction to the be held on 21.8.2003, but on account of the stay order from the Civil Court, it was postponed for which a due publication was also made intimating the subsequent date. The petitioners have not placed on record any documents/sale-deed to show that in the year 2003 there had been increase in the rate of the land rather on the contrary a bare perusal of the letter written by the Society to the Tehsildar in the year 2003 as well seeking the rate/market value of the land, wherein the Tehsildar vide his endorsement dated 16.6.2003 was of the same view that the market price of the land (khasra number written) in village Wazirabad and Hyderpur is approximately Rs. 40 lacs per acre. Thus, position emerges that during those days the market rate was Rs. 40 lacs per acre. As discussed above, the petitioners have not placed on record any document to show that it was more than Rs. 40 lacs per acre. The Registrar while giving permission had already laid conditions of the auction of land. It is pertinent to mention here, the argument of learned Counsel for the petitioners that the duty of the Board of the Administrator is only to nail the ship which is in doll-drum to urge that the Board of Administrator is not required to take the major decision like sale/auction of the land, does not find favour of this Court for the reasons that, as discussed above, the decision of the sale/auction of the land was taken by the General Body of the Society, which was subsequently carried out by the Sales Committee, appointed by the Registrar laying certain other conditions for which there is no evidence or the documents on the record as to the violation of any of the condition, except that has been argued that the advertisements were not in the newspaper, which had a wide circulation in that area. But, on the other hand, the Society itself had written to the authorities to publicize in less expensive but popular newspaper on account of paucity of the funds. However, it cannot be overlooked that initially there was an advertisement of the auction and then about the post-ponment of the auction and it cannot be construed that the persons willing to give bid were not aware of the auction.
23. It has been argued by the learned Counsel for the petitioners that this situation prevailed in the year 2002 whereas the auction had taken place in the year 2003 and there had been a sufficient increase in the land prices and a reference has been made to the rate list for the year 2001-02 relating to the proposed rates of the residence in square yards wherein in the Saraswati Kunj, which is alleged to be situated adjacent to the land in question, the rate shown are Rs. 3,300/- per sq. yards. But this argument is again without any substance for variety of reasons. Firstly, it is settled proposition of law that suppression of material facts dis-entitles the petitioners to the extra ordinary remedy under the writ jurisdiction. In the instant case, as said above, the petitioners are guilty of concealment of material facts regarding market price of the land in question i.e. Rs. 40 lacs per acre, which they obtained from Tehsildar and their request to sell the land for Rs. 4.2 crores. Rather, on the contrary, in order to confuse the issue, the petitioners placed reliance on the rate of developed colonies. However, at the same time, it cannot be overlooked that these rates relate to the plots of colonies which have already been developed by the Colonizers and not of the agricultural land, as a Colonizer has to leave sufficient area for the parks, roads, etc. for the purpose of development of the colony, apart from other expenses relating to the licence fee to be paid to the Government. Secondly, in the same year i.e. 2003, in which the auction took place, fresh market rates were also obtained from the Tehsildar and this time again the market rate was opined to be Rs. 40 lacs per acre, although in the rate list Ex. R7/3 relating to the year 2002-03 of Tehsil Gurgaon, the Collector rate of village Hyderpur Wiran and Wazirpur has been quoted to be Rs. 12 lacs per acre.
24. The argument that the sale was never confirmed by the Registrar, as provided under Section 33(4) of the Act, is again merit less. The relevant Section only stipulates that when the Board of Administrator are appointed, all the actions are subject to the control of the Registrar. However, in the instant case, for the purpose of sale/auction, the Sales Committee was constituted, through, may be, some of the members are the same. The rates of the land at the relevant time had already been obtained. A bare perusal of the permission Annexure P-12 shows that there is no such stipulation that after the sale/auction of the land any formal permission/approval is required from the Registrar, rather it stipulates that the amount be disbursed proportionately to the members except the members against whom the case of surcharge is pending. Had there been any intention of the Registrar for giving approval after the sale/auction, the same should have been firstly reflected in the order of permission, which is not there and in that situation, he would not have further ordered for the disbursement of the amount to the legible members.
25. Thus, in totality, it cannot be said that there was any violation of the conditions stipulated by the Registrar while according permission to sell the land.
26. Now let us advert to the tenor and manner in which the said auction/sale of the land of the Society had taken place.
27. The land of the Society had been sold/auctioned for about Rs. 46.25 lacs per acre against the Collector rale of Rs. 12 lacs per acre and market rate of Rs. 40 lacs per acre. It cannot be said that there was any fraud, as alleged or sale/auction be termed as bad. Therefore, the prayer of petitioners in C.W.P. No. 7742 of 2005 to get the matter investigated from any independent agency like C.B.I. etc. cannot be acceded to and same is accordingly turned down. However, from the records, it appears that there is some element of hurriedness at the time of auction of the land of the Society in favour of respondent No. 7. There are reasons for that. It appears that some son of pool had been formed for and on behalf of respondent No. 7, which could be ascertained by the fact that the demand drafts for Rs. 4.9 crores were already got prepared, as conceded by learned Counsel for respondent No. 7 two days prior to the date of auction i.e. 22.11.2003, which also reflected on the keen desire of respondent No. 7 to purchase the land in question and also the execution of the sale-deed on the same day with immediately delivery of possession thereof. Moreover, the bidders i.e. Bhupesh Builders etc. who had given the bids look to be close associate of respondent No. 7. No doubt the reputed builders like D.L.F., Unitech, Ansal etc. subsequently conveyed to respondent No. 7 that they were not interested to the auction owing to their busyness in their own project, but considering the factum of gap between the market rate of Rs. 40 lacs per acre and the sale/auction of the land in question, which has finally hammered at Rs. 46.25 lacs per acre, this Court is of the considered opinion that had other reputed builders would have stepped in the bidding process, there would be certainly some stepping up in the same, adding more price to the land of the Society. That part, it cannot be forgotten that what the trend is going on real estate business in the vicinity like Gurgaon, which has been proved to be a successful hub for developers and builders, where disputed land is situated.
28. Even against all odds, referred to above and legal hurdles, if this Court shut the eyes with a view that it is disputed facts and the Courts are reluctant to interfere, then it will lead to causing grave injustice to the members of the Society who have contributed their hard earned money, but the ultimate result is that the members of the society has been affected at large. On the basis of audit report and the report of Inspector, Cooperative Societies, Gurgaon, it was found that the funds of the Society, collected under the garb of development work were misappropriated to the larger extent. There had been malpractice in the affairs of the Society right from the beginning by the members of the managing committee or during the tenure of previous Board of Administrators and even the erred members of the Managing Committee are facing criminal trial in respect of mis-deeds. But, it appeals to this Court that the members of the Society, who have contributed a hefty amount from their hard earned money towards running of the Society to fulfill their dreams, which although have completely shattered at the hands of corrupt members of the Managing Committee, who have created a situation for the other members to run away with foot on their heads, needs some concession from the Court. On the contrary it is apt to mention here that by their own act and misconduct, in initially approaching this Court directly and then after availing the liberty to challenge the impugned orders by way of filing an appeal before the Competent Authority, which needless to say, was not filed properly, the petitioners have allowed much water to flow from the date of auction i.e. 24.11.2003. What emerges from the record is that in the intervening period, respondent No. 7, the purchaser, has exchanged some part of the land with Saraswati Kunj Cooperative Society, as is evident from Annexure R-7/33, to form a bigger colony; necessary licence to develop a colony at the land in dispute has also been obtained from the Government with permission to change of user; development plans have been made with launching of special schemes and for which, obviously crores of rupees must have been spent by them for the purpose, including the cost of the land.
29. Now the question arises up to what extent the stepping would be, if the reputed builders would have joined the auction proceedings? It cannot be overlooked that this has to be in conjunction with the Collector rate i.e. Rs. 12 lacs per acre and market rate of Rs. 40 lacs per acre, prevailing at the time when the said auction had taken place. Although, it has been contended by learned Counsel for the petitioner that in the present scenario, there is manifold increases in the prices of the land in question, but this Court is of the considered opinion that the petitioners cannot derive any benefit from the same. The Court has only to see the position prevalent in the year 2003 i.e. at the time of auction and at the same time it has also to be taken care of the fact that there could not be such a colossal gap between the market price of the land and the price which it can fetch, in case the reputed builder joined the bidding process.
30. There is a letter written by Capt. A.K. Mahindra, after some days of the auction of the land of the Society, to the Registrar Cooperative Societies whereby an offer to purchase the land @ of Rs. 70 lacs per acre was made, saying that this amount is sufficient to pay back the members those who have already paid Rs. 7.5 crores approximately apart interest etc. Thus, the petitioners cannot wriggle out from this offer, which had been made while in conscious state by A.K. Mahindra, who had been authorized in the General Body meeting dated 2.6.2002, to pursue the matter. This figure though is on hy-potehtical basis but in the backdrop of the facts of Collector rate and the market, this Court feels that there had to be some stepping up, had there been association of reputed builders in the bidding process. Thus, taking into account all these circumstances, there appears to be some injustice on the part of the members of the society, who have been parted away even from their initial deposits/investments, except the erring members, against whom surcharge proceedings are pending and are involved in eating up the funds of the Society. But at the same time the Courts have to make both the scales equal and to see that no injustice is caused to either of the parties. The interest of respondent No. 7, which, without caring for the de-merits/constraints relating to the land in question, as reflected from the discussion under various agendas of General Body meeting held on 2.6.2002, as well as the future prospective of the land in question, dared to purchase it by investing crores of rupees and further pursued the matter for development/removal of encumbrances from land in question, in which it ultimately succeeded to a large extent, have also to be protected.
31. Therefore, to put an end to this litigation and considering the interest of the members of the Society, this Court is of the considered opinion that the amount of Rs. 70 lacs per acre is proved to be sufficient for the eligible members. This Court orders accordingly. The difference of amount which has come now with the increase in the cost of the land, will be paid by respondent No. 7 to the Registrar, Cooperative Societies, Haryana within a period of 45 days from today. Although, as discussed above, the delay has occurred due to the act and conduct of the petitioners themselves, but keeping in view the facts of the case, interest @ 6% per annum is also awarded on the amount which has been awarded by dint of the present order, from the date of auction till the payment is actually made now by respondent No. 7. It is further directed that the Registrar, Cooperative Societies, Haryana immediately on receiving the amount, will also ensure a new sale-deed in favour of respondent No. 7, as per new rates, with the same stipulation and procedure like payment of stamp duty, other expenses etc. which was adopted while executing the earlier sale-deed. Since, as discussed above, some of the part of the land has been exchanged by the respondent No. 7 with Saraswati Kunj and the land has also been mutated in its favour, therefore, to avoid any intricacy relating to the revenue records, there will be no impediment if respondent No. 7 only deposit the difference of stamp duty etc., instead of fresh sale-deed, if permissible under the law. It is further directed that the amount so received from respondent No. 7 shall be disbursed forthwith amongst the eligible members proportionately, except the tainted one, by the Registrar himself or by any other person authorized by him in this regard and the shares of tainted members be kept reserved until the decision of surcharge cases and be adjusted against the recovery, if any ordered, from them. It has also been pointed out that many of the members have taken their refund, coming to their share by virtue of the amount received from the auction/sale of the land in question. Be that so, the members who have already received their share are only entitled to the difference, which now comes to their share as a result of increase in the cost of the land in question.
32. Before parting, it is made clear that the concession given by this Court, in the peculiar facts and circumstances of the case, towards the cost of the land, considering the interest of members of the society, be not taken as a precedent for any other purposes.
Both the writ petitions stand disposed of in the above terms.