Delhi High Court
Sarbjit Singh And Ors. vs All India Fine Arts & Crafts Soclety And ... on 24 May, 1989
Equivalent citations: ILR1989DELHI585
JUDGMENT Mahinder Narain, J.
(1) By this order, I propose to deal with an application filed by the plaintiffs under Order 39 Rules 1 and 2 of the Code of Civil Procedure, and objections regarding maintainability of the above said suit.
(2) By the application, the plaintiffs prayed that defendants No. 1, 2 and 3, its employees and agents be restrained from in any manner renewing/negotiating or executing a fresh lease deed with respect to the premises of All India Fine Arts & Crafts Society Building, Rafi Marg, New Delhi, which is occupied by the British Cbuncil. The plaintiffs also seek to restrain: the defendants from parting with possession of any part of the premises. The plaintiffs also seek an order from this Court restraining defendant No. 2, S. S. Bhagat, and defendant No. 3, Jag Mohan Chopra, from acting as Secretary and Chairman of the All India. Fine Arts & Crafts Society, defendant No. 1, tall tits annual General Meeting is held as per law and as per Memorandum & Articles of Association of defendant No. 1 Society.
(3) During the course of arguments, it has also been stated that inasmuch as the provisions of the Memorandum & Articles of Association of defendant No. 1 Society have been violated, an administrator be appointed for the purposes of ensuring compliance of the provisions of the Memorandum & Articles of Association, particularly holding of the mandatory Annual General Meetings of the Society, and having elections in accordance therewith.
(4) The plaintiffs Sarbjit Singh, M. K. Puri and Man Simran Singh had filed this suit, asserting that plaintiff No. 1 is a life member of defendant No. 1, and that plaintiffs No. 2 and 3 are members, and ex office bearers of defendant No. 1 Society.
(5) It is asserted that defendant No. 1 is registered under the Societies Registration Act, 1860. That defendants No. 2 and 3 are the Secretary of the society, that defendant No. 3 was elected as Chairman of the Society at a meeting held on 16th January, 1988.
(6) The plaintiffs assert that the Annual General Meetings of the Society at which the new office bearers of the Society are to be elected, have not been held for two years in contravention of Article Vi of the Memorandum & Articles of Association of the Society. It is asserted that according to Article Vi, the Annual General Meetings of the Society have to be held every year on some convenient date between 1st day of April and last day of October, and have to be fixed by the Council. Notices for holding the Annual General Meeting have to be accompanied by the audited balance-sheet and the agenda for the meeting, which have to bo posted to each member of defendant No. 1 Society at least 15 clear days before the date of the meeting. It has also to be accompanied by a report of the work of the Society during the past year and the audited balance-sheet together with budget for the next year, which has to be presented at the meeting, for adoption and approval.
(7) It is asserted that the notices for the 58th/59th Annual General Meeting for the years 1985-86 and 1986-87 sent by defendant No. 2. which notified that the Annual General Meeting of the Society was to be held on Saturday, 16th January, 1988. was not a proper notice. It is also noted that the notice stipulated that the Appeal General Meeting which was to be held on 27-12-19S7 will be held on 16-1-1988.
(8) It is asserted that letting out of a portion of the premises to the British Council at a monthly rental of Rs. 1.50 lacs by defendant No. 2 is a commercial activity which is illegal and invalid, and has no sanction for the Memorandum of the Society. It is also asserted that defendant No. 2 in. connivance with defendant, in breach of the provisions of the Societies Registration Act, 1860 let out the premises to the British Council for commercial purposes. It is also asserted that defendants No. 2 and 3 are tampering with the records of the Society to cover up the misuse.
(9) It is further asserted that the Annual General Meeting which was held on 31-12-1987 or 8-1-1988, is illegal and contrary to the provisions of the Memorandum and Articles of the Society, and are liable to be set aside, and the office bearers elected at the said meeting can be restrained "front functioning as office bearers of the Society".
(10) It is also asserted in the plaint that defendant No. 3 who is the Principal of the Arts College in Chandigarh, has been directed by the Administrator of Chandigarh and Cover-nor of Punjab, Shri S.S. Ray, not to net as Chairman of defendant No. 1, and that he is not carrying on the directives of the Governor of Punjab & Haryana dispute the orders to that effect. It is also asserted that defendants No. 2 and 3 have connived at and given an award of Rs. 10.000 to defendant No. 3.
(11) In the Written statement filed by the defendants, it has been asserted that the plaint is not signed and verified properly. It is stated that plaintiffs No. 2 and 3 have not signed the plaint, nor have authorised any counsel to file the same on their behalf, and that the power of attorney filed in the suit, also does not bear the signatures of plaintiffs No. 2 and 3. It is asserted that plaintiff No. 1 has misconducted himself, and has misrepresented the facts before this Court. It is stated in the written statement that Shri Mansimran Singh wrote to the defendant that he has "falsely implicated" in the instant suit as a plaintiff, and that he has neither signed the plaint, not authorised any Advocate to file the suit. It is denied that there's any cause of action in favor of the plaintiffs. It is asserted that the plaintiffs have no locus standi to file the suit, and they have not come to the court with clean hands.
(12) It is asserted that plaintiff No. 1 has misrepresented that he is a life member of defendant No. 1 Society. It is asserted that plaintiff No. I is not even the member of the Society. It is admitted in para 4 of the written statement that, "the fact remains that he was once a member of the Society over 21 years ago, and thereafter has ceased to be a member". It is asserted that false and defamatory statements have been made against the defendants, and the suit is liable to be dismissed on that account. It is denied by the defendants that any money is being made by the defendants from out of some deal with third party in regard to lease of the property, and the defendants reserve their right to proceed against the plaintiffs as they may be advised.
(13) It is also asserted in the written statement that premises in question has to remain on lease with the British Council till December, 1991 as per arrangement between the defendant Society and the British Council who have been enjoying the leased premises for over 30 years. It is asserted that the lease of the British Council is to expire ini December, 1991. It is also asserted that the suit suffers on account of delay and laches: that the elections of the office bearers took place on 16-1-1988 and the next elections have to be held in due course as per provisions of the constitution of the defendant Society every year. If is asserted that as the Secretary of the Society is not elected office bearer, the suit is not maintainable on this account also.
(14) It is further asserted that the suit is not maintainable in view of the provisions of the Specific ReliefAct.
(15) At this stage, I arn not concerned with whether the allegations will be proved. The matter of locus standi of the plaintiffs to file the suit. hewever, has to be dealt with at this stage.
(16) It is the admitted case of both the parties that defendant No. 1 is a Society, registered under the Societies Registration Act, 1860. It is also the admitted case of the parties that there arc Memorandum & Articles of association of defendant No. 1 Society. That Memorandum & Articles of Association have been filed in this Court. According to the Memorandum of Association of defendant No. 1 Society, the Society has been formed, inter alia,- (A)To foster and develop fine and applied Arts in India and to promote their study and appreciation by means of Publications, Lectures, Conferences, Demonstrations, Exhibitions Correspondence with kindred Societies and with Museums of Art in India and abroad and to collect literary records relating thereto and to any other branch of Indian Art and culture. (b) To organise and establish a National Art Gallery in New Delhi and to help in Regional Regional Art Galleries. (e) To publish "Roop Lekha"-an illustrated Arts & Crafts Journal. (d) To establish and maintain a National Academy of Arts. To assist Regional Organisations in establishing Art Galleries. (f) To establish and maintain a public Art Library (g) To organise Art Exhibitions and Societies, in India and abroad.
16(i). Article I provides lor Membership of the Society, and it says that Membership of the Society is open to :- (A)Representatives of member Art Societies or Associations. (b) Representatives of member Institutions. (e) Individuals (including Life, Ordinary and Honorary Members, Patrons and Vice-Patrons).
l6(ii). Article Ii of the Article of Association of the Society postulates that a Governing Body shall manage it and control the funds of the Society. 16(iii). Article Vi pertains to Annual General Meeting of the Society, and it reads as under :- "THE Annual Genera? Meeting of the Society shall be held every year on some convenient date between first day of April and last day of October to be fixed by the Council. Notice of this meeting to other with a copy of the audited Balance Sheet and the Agenda be posted to each member at least 15 clear days before the date of the meeting. A report of the work of the Society for the past year and the audited balance sheet together with the Budget for the next year shall be presented at the meeting for adoption and approval. The meeting shall then elect by vote, in such manner as the Chairman shall decide, the Office bearers for the ensuing year and fill the vacancies as laid down in Article Iv para 3. No other business shall be transacted at the Annual General Meeting."
16(iv). Article Xi relates to subscription, and it reads as under :- "SUBSCRIPTION for individual members shall be Rs. 251- per annum. Life Membership fee shall be a lump sum of Rs. 509.00 . The subscription for Institution members and for Association or Society members shall pay a sum of Rs. 301- per annum in addition, all new members shall pay a sum of Rs. 301- as admission fee. All subscription are due on the first day of January, each year. Each member shall be entitled to receive copies of Roop-Lekha and monthly bulletin Art News free from the Society issued during the year in which he may join. No free copies of the publication shall be issued to any member whose subscription for the current year has not been paid. Any member whose subscription is in arrears for more than one year and to whom two notices requesting payment have been sent, shall cease to be a member but his liability for the current year's subscription shall not be cancelled thereby. The ordinary liability of a member is to the extent of his subscription in arrears, Members who have not formally resigned before the last day or December shall be liable to pay their subscription for the following year."
16(v). Article Xvi relates to expulsion, and it reads as under:- "ANY member may be removed from the Society by the Council without any reasons being assigned and the Council's decision in such matters shall be final."
(17) In my view, as defendant No. I Society is a registered Society under the Societies Registration Act, 1860. All its activities and actions, its Memorandum and Articles of Association have to conform to the provisions of the Societies Registration Act. All actions of the Society have to accord with the provisions of the Societies Registration Act, and it is not open to the Society to do any act or formulate any Article of Association which is at variance with, or contrary to the provisions of the Societies Registration Act. For the purposes of the instant petition it is necessary to refer to the provisions of section 15 of the Societies Registration Act. The said section reads as under :-- "FOR the purposes of this Act a member of a society shall be a person who. having been admitted therein according. to the rules and regulations thereof, shall have paid a subscription or shall ha vs signed the roll or list of members thereof, and shall not have resigned in accordance with such rules and regulations; but in all proceedings under this Act no person shall be entitled to vote or to be counted as a member whose subscription at the time shall have been in arrear for a period exceeding three months."
(18) From the above provisions of section 15, it is apparent that section 15 does not postulate expulsion of any member from the membership of the Society. All that it postulates, is that a member once admitted to membership, shall continue to be a member of the Society. It also postulates that a person whose .subscription is in arrears for a period exceeding three years, shall not be entitled to vote or to be counted as a member.
(19) The assertions of the defendants that the plaintiffs are not members of the Society, have to be tested with reference to the above said provisions of the Societies Registration Act. The contention of the defendants that plaintiff No. I has ceased to be a member of the Society on account of his being expelled from the Society, has also to be tested with reference to section 15 of the Act. According to Article Xvi of the Articles of Association, any member may be removed from the Society by the Council without any reasons being assigned and the Council's decision in such matters shall be final, prima facie, seems to be against the provisions of section 15 of the Societies Registration Act, as" the societies Registration Act does not postulate expulsion of any member from the Society. All that it postulates is that a person may resign from the membership of the Society. In case a member is in arrears of subscription for a period of over three months, he is not entitled to vote. The emphasis in section 15 appears to be on voting alone, as it is reiterated in that section that a person whose subscription is in arrears for a period of more than three months, shall not be counted as a member. Prima fade. a person is likely to be counted as a member only at the meetings of the Society, and when any particular matter is sought to be voted upon, and not otherwise.
(20) This view bears strength from the provisions of section 13 of the Societies Registration Act, which reads as follows :- 13.Any number no, less than three-fifths of the members of any society may determine that it shall be dissolved, and thereupon it shall be dissolved forthwith, or at the time then agreed upon, and all necessary steps shall be taken for the disposal and settlement of the property of the society, its claims and liabilities, according to the rules of the said society applicable thereto, if any. and, if not, then as the governing body shall find expedient, provided that, in the event of any dispute arising among the said governing body or the members of the society, the adjustment of its affairs shall be referred to the principal Court of original civil jurisdiction of the district in which the chief building of the society is situate : and the Court shall make such order in the matter as it shall deem requisite." Provided that no society shall be dissolved unless three-fifths of the members shall have expressed a wish for such dissolution by their vote delivered in person, or by proxy, at a general meeting convened for the purpose : Provided that whenever any Government is a member of, or a contributor to, or otherwise interested in, any society registered under this Act, such society shall not be dissolved without the consent of the Government of the State of registration."
(21) The words in this section that "any dispute arising among the. members of the society shall be referred to the principal court of original jurisdiction of the district in which the chief building of the society is situate" seem to indicate that the dispute relating to the membership of the Society, whether or not a particular person is a member of the Society, has to be retired for adjudication to the principal court of original civil jurisdiction, in the district in which the chief building of the society is situate. As far as plaintiff No. I is concerned, it has been admitted that he was a member of the Society. What is asserted in the written statement is that plaintiff No. I was excelled from the society. As I have stated above, there is no provision. in the. Societies Registration Act which permits any Society registered under the Act, to expel its members. As such, prima facie, this Court cannot take into account any alleged act of expulsion cf the plaintiff from defendant No. I Society. In any event, the rules of natural justice would require that before any member of the Society can be expelled from the Society, he must be served with notice, calling upon him to pay the arrears, falling which he shall cease to be counted as a member of the Society. Defendants, to date have not filed in this case any copy of any notice addressed to plaintiff No. I, indicating that a show-cause notice was issued to plaintiff No. 1. All that the defendants have filed, is a ledger folio indicating that plaintiff No. I was in arrears of membership a long time ago, and that as he did not pay the arrears, he ceased to be. a member. It has to be borne in mind that section 34 of the Evidence Act makes it clear that entries in the books of account are not sufficient by themselves to fix liability against any person.
(22) The photo copy of the ledger, of plaintiff No. 1, Sarbjit Singil, produced by Mr. R. L. Bhagat, Advocate, bears an endorsement that the "name removed from the membership for non-payment of dues in spite of reminders". This action, prima facie. is contrary to section 15 of the Societies Registration Act. In my view, this cannot be. done as the ledger only reflects the account of a party, entries wherein cannot by themselves impose a liability.
(23) Register of members even has not been produced by the defendants. As the Society has to have members, register of members has to be maintained by any Society which enrolls members, as have been enrolled by defendant No. 1 Society It is in this. register that particulars like the date of membership, or ceasing of membership by any other matter relatable to members shall have to be incorporated. In the instant case, as stated above, no notice to show-cause has been sent to plaintiff No. 1, at least none has been brought to my notice and none has been filed in Court. Therefore, it has to he accepted on a prima facie basis, that plaintiff No. I continues to be a member of the Society. He may be a member who has not paid his subscription for a period exceeding three months, but he is a member nonetheless. He will not be entitled to vote at the meeting until the up-to-date subscription has been paid. He can, therefore, bring this suit in the court by virtue of section 13 of the Societies Registration Act.
(24) As regards plaintiff No. 2, it is asserted in the written statement that he is a member of th& Society who has been expelled from the membership of the society by resolution of the Governing Council meeting dated 8-8-1985 and is, therefore not a member of the Society. As observed by me above, expulsion of any member is not contemplated by section 15 of the Act. Section 13 of the Act, reproduced here above, requires that any dispute between the parties has to be referred to the principal court of original civil jurisdiction in the district where the principal building of the society is located. It is not the case of the defendants that such a dispute was pending and/or adjudicated by a civil court, and as such, on prima facie basis, it cannot be said that plaintiff No. 2 has been expelled from the Society, particularly as no notice to show cause that why he should not be expelled, has been brought to my notice, and none has been filed in Court. All that has been brought to my notice, is a ledger folio which indicates that plaintiff No.2 was in arrears of subscription, but that by itself is not sufficient for "expelling" any person. In any case, as observed above. expulsion is not postulated by th& Societies Registration Act. All that it indicates is that a person whose subscription is in arrears, is not entitled to vote at any meeting, and thus he is not to be counted as a member. This disability to vote disappears when arrears are paid.
(25) As far as plaintiff No. 3 is concerned, it is stated the plaintiff No. 3 is an unwilling plaintiff He has written to defendant No. 2 that lie has been "falsely implicated" in the suit. As against this assertion, plaintiff No. 3 has appeared in Court, and given the following statement on 20-4-1989 :- "IN the plaint I have been shown as plaintiff No. 3. I had given my consent to Mr. Sarbjit Singh, plaintiff No. I in this suit. I had authorised Mr. Sarbjit Singh to have the plaint prepared and engage counsel for purposes of the suit vabatty. I have not seen the plaint. That was prepared by counsel and filed in this Court. I have been informed about the contents of the plaint but I have not actually seen the plaint. I want to continue to be the plaintiff in this suit. I live in Himachal Pradesh. I do not live in Delhi Q. by Mr. R. L. Bhagat : I suggest it to you that you have decided to become a plaintiff in the suit as a result of pressure being put on you from certain potters ? A I am under no pressure from anyone. Q : I suggest it to you that you have been signing various letters for the plaintiff and the defendant according to your convenience 7 A : I have given only one letter in May last year the Secretary, Aifa & Crafts Society. Q : Have you been elected as a Member of the Aifa & Crafts Society at the election held last year ? A : I have not been informed of any election or its results. I did attend a meeting of the Council on or about 14th April, 1989, as I was there in connection with All India Studio Potters Exhibition. I was in the Exhibition halls on the ground floor and I was summoned to attend the meeting through a pean, and I attended that meeting. I did' not receive any notice of the meeting of the Council which was held on or about 14th April, 1989, a9 I was not in Himachal Pradesh. I will find out oil my return whether I had received any notices or not with respect to the Meeting of the Council (26) It view of this statement of. Man Simran Singh, plaintiff No. 3, it is apparent that he has authorised of filing of the suit, and that he wants to continue the suit.
(27) Mr. Sawhney who appears for plaintiff No. 3 also, has contended that provisions of Order Vi Rule 14 of the Code of Civil 'Procedure have to be reasonably construed, and construed reasonably it means that the plaintiff need not sign the plaint if by reason of his absence or otherwise is unable to sign the plaint at: the time the suit is instituted.
(28) Mr. Sawhney has also referred to and relied upon the judgment (Karam Singh v. Ram Rachhpal Singh & Ors.) (1) which is to the effect that requirement of Order Vi Rule 14 is procedural, and can bs made good at any later stage, and that it is not permissible to reject the plaint for the reason that it is not signed by one of the plaintiffs. It is further held in that case that an opportunity has to be given to the plaintiff to sign and verify the plaint. R. S. Pathak. Chief Justice, as he then was, relied upon a judgment (All India Reporter Ltd., Bombay with branch office at Nagpur and another v. Ramchandra Dhondo Datar(2), which is also to the same effect. In this view of the metter, as plaintiff No. 3 who wants to pursue the suit; it cannot, be said that the instant suit is not maintainable I therefore hold that the instant suit is maintainable at the behest of plaintiff No. 3, who admittedly is still member of the Society. The suit is maintainable by plaintiff No. 3 alone. The suit is also maintainable by plaintiff No. 1 who is admitted to have been a past member and Vice-President of the Society. He may be a member whose subscription is in arrears, but he can maintain the suit in view of section 13 of the Act.
(29) As regards plaintiff No. 2, he admittedly was a member at one time. He is purported to have been expelled at a meeting of the Society which is allegedly held on 8-8-1985. No show cause notice having been issued to him before that date, the expulsion, even if it is permissible by the Memorandum & Articles of Association, would be contrary to the natural justice. and, therefore, of no effect in law. No person can be condemned unheard.
(30) This is apart from the facie that section 15 does not permit expulsion of members, and there is no provision other than section 15 of the Act which deals with status of members of a society. Section 13 of the Act postulates reference of disputes between the members and the Society, to a principal civil court of jurisdiction where the principal building of the society is located. It is not the case. of defendant No. I Society that any such dispute was referred to such Court, and that the expulsion has been upheld by a competent court. In this view of the matter, on a prima facie basis, I have to come to the conclusion that each of the three plaintiffs are entitled to maintain the suit.
(31) As I have held that the plaintiffs are entitled to maintain the suit, one has to deal with the other contentions of the plaintiffs that defendants No.2 and 3 are so conducting the affairs of the society that the Memorandum & Articles of Association of the Society are not being complied with, and that the Annual General Meetings of the Society are not being held, ill accordance with the provisions of the Articles of Association, and so the election of the office bearers of the Society is contrary thereto, and illegal.
(32) In this connection, it is necessary to bear in mind the provisions of section 4 of the Act, which by necessary intendment, postulates that the Annual General Meeting is to bs held each year in accordance with the rules. Section 4 of the Act reads as under :- "ONCE in every year, on or before the fourteenth day succeeding the day en which, according to the rules of the society, the annual general meeting of the society is held, or, if the rules do not provide for an annual general meeting, in the month or January a list shall be filed with "the Registrar the names, addresses and occupations of the governors, council, directors, committee or other governing body then entrusted with the management of the affairs of the society."
(33) Thus there is statutory requirement for holding of an Annual General Meeting each year when so provided in the Memorandum & Articles of Association of the Society. That provision in the Articles of Association of defendant No. Society reads as under :- "THE Annual General Meeting of the Society shall be held every year on some convenient date between first day of April and last day of October to bs fixed by the Council."
(34) It is contended by Mr. K. Sawhney that unless the requirements of the Societies Registration Act which postulate holding of Annual General Meeting, and the requirements of the Articles of Association which postulate holding of the Annual General Meeting every year during the period April to October of each year. are fulfillled, then vacuum comes into existence inasmuch as it cannot be said that any office bearer of the Society has been elected in accordance with law, and no office bearer who is elected, at a meeting which has been held and conducted in contravention of the provisions of the statute, or the Articles & Memorandum of Association, can be permitted to exercise any authority or power over any of the affairs of the society, and as such it is necessary to appoint an Administrator to cure the illegality which has occurred by nonholding of the Annual General Meeting in accordance with the provisions of the Articles of Association.
(35) The defendants have admitted in their written statement that the Annual General Meeting of the society was to be held pursuant to a notice which read? as under :- "31STDecember, 1987 Meeting Notice 35(i) As per the decision of the Council meeting of the Society held on 23rd December. 1987 the 58th [59th" Annual General Meeting of the Society fixed for 27th December, 1987 will now be held on Saturday the 16th January, 1988. Agenda and venue of the meeting remains the same. You are requested to attend' the meeting and also attend the Annual Social Dinner. sd/- S. S. Bhagat Secretary"
Another notice dated 8th January, 1988 has also been filed. The sa'd notice reads as under :-- "8THJanuary, 1988. Meeting Notice 35(ii) A meeting of the Council of the Society would be held on Saturday the 16th January, 1988, at 4.30 P.M. at the premises of the Society. Shri Jagmohan Chopra, Chairman of the. Society would preside. You are requested to be present. Agenda 1. To. confirm the minutes o[ the Council meetings held on 7th November, 1987 & 23rd December, 1987. Minutes being sent separately. 2. To consider and approve the Secretary's note on actions taken. Note to be placed on the table. 3. To recommend to the General Body the office bearers and Members of the Council against the 1/3rd members retiring by rotation for the ensuing year. 4. To discuss the letter received from Cbt Press regarding printing of Roopa-Lekha volume Lx No. 1--"Letter to be placed on the table. 5. Any other business with the permission of the Chair. sd/- S. S. Bhagat, SECRETARY".
(36) Reading both these notices together, it is apparent that 58thj59th Annual General Meetings of the Society are sought to be combined as one meeting. Even that is to be held at a time which is beyond the time fixed for holding of Annual General Meeting between April and October of each year. It is also clear that any election which was held on 316-1-1988 was contrary to the provisions of the Articles and Memorandum of Association of the Society, and that election of office bearers at such an Annual General Meeting has to be, prima facic, held to be void. Defendant No. 3 has been elected as Chairman of the Society at such a void meeting. Hs cannot be permitted to act as Chairman Of the Society. Even. during the course of the hearing, it has transpired that the requisite audited accounts of the Society have not been prepasd for holding of the next Annual General Meeting.
(37) I had directed Mr. R. L. Bhagat on 20-4-1989, who appears for the defendants, to make enquiries and find out from the auditors of the society as to the status of accounts of the Society. He made statement on 24-4-1989 based upon a letter of M/s. D. P. Khosla & Co.. Chartered Accountants, that account of defendant No. 1 are being prepared, and they will bs ready within three-four weeks. This statement was made en (he basis of the said letter filed by Mis. D.' P. Khosla & Co., Chartered Accountant, which is reproduced as under :- "21STApril, 1980. The Secretary All India Fine Art & Craft Society Rafi Marg, New Delhi-110001. Dear Sir, This is to inform you that the audit work which is in progress is likely to take another 3 to 4 weeks to complete. We are trying to expedite the same and shall try to release it as early as possible. Thanking you ; Yours faithfully, for D. P. Khosla & Company, Chartered Accountants, sd/- (R. K. BINDLJSH)".
(38) From the above it is apparent that there are disputes between the members, and the Society, that requirements of the Articles & Memorandum of Association of the Society and also of the provisions of the Societies Registration Act which requir; holding of Annual General Meeting annually, are not being complied with. The defendant Society relies upon the elections of the office bearers which had taken place contrary to the terms of the statute and the provisions of the Articles of Association of the Society. It is, therefore, in the interest of all members of the Society that the affairs of the Society be regularised, and the only way to regularise the affairs of the Society is to ensure that for the current year the Annual General Meeting is held in accordance with the provisions of the Societies Registration Act and the Articles of Association. This can be done by appointment of an Administrator to administer the affairs of the Society to ensure due compliance with the requirements of the Memorandum & Articles of Association, and the Societies Registration Act, that Annual General Meeting is held in accordance with law and elections thereat are also in accordant with law.
(39) The main contention of Mr. R. L. Bhagat is that the instant suit is not maintainable. He says that the instant suit is not maintainable inasmuch as there is delay on the part of the plaintiffs in approaching this Court. He refers to a judgment of the Supreme Court (Ashok Kumar Mishra and another v. Collector, Raipur and others), (3) wherein it was held that 8 days delay was sufficient to debar a suit. In my view, the said judgment is. not applicable to the instant suit, inasmuch as the facts in that case were that an electoral roll was sought, to be challenged and the suit was instituted for quashing the electoral roll. The instant case is not the one in which any electoral roll is being questioned What is being questioned is the actual elections which have been held contrary to the provisions of the Articles & Memorandum of Association, regarding the holding of Annual General Meetings, and a declaration is sought that the office bearers elected at a meeting held contrary to the provisions of the Articles of Association are not holding the office legally or validly.
(40) In the instant case, the elections were held in January. 1988. The plaintiffs approached this Court by filing tile suit on 30-4-1988. The period for which the persons' allegedly elected at the elections held contrary to the provisions' of the Articles of Association, were to hold office is whole of the year. In this view of the matter, there is no such delay as would defeat the suit.
(41) It is next contended that there is no breach of contract between the plaintiffs and the Society. As such the provisions of Order 39 do not apply. -In my view there is no substance in this contention, as it has to be borne in mind that the instant suit relates to the affairs of the Society registered under the Societies Registration Act. The Memorandum and Articles of Association of the Society is itself the contract between each member, each of whom contracts with other of them that each would be governed by the provisions of the Memorandum and Articles of Association. Inasmuch as it is alleged, and is admitted, that the Annual General Meeting was held in January, 3988, which is contrary to the Articles of Association, which require that the elections be held between April and October. there is a breach of agreement between the parties, as evidenced by the Memorandum & Articles of Association of the Society. For this reason, section 41(e) of the Specific Relief Act, which is referred to by Mr. R. L. Bhagat, does not come to his aid, there being a breach of the terms of the Memorandum & Articles of Association regarding holding of the Annual General Meeting.
(42) It is urged by Mr. R. L. Bhagat that inasmuch as plaintiff No. 3 has participated in the election which was held in January. 1988, he has acquiesced in that election, and' as such he cannot be a plaintiff in a suit. For this proposition, lie relies upon (S. Krishnaswamy & ors. v. South India Film Chamber of Commerce and others). (4) A perusal of the judgment would show that the facts therein were defferent. In that case a person had participated in the elections and had lost, and after losing the elections, approached the court for setting aside the. elections. It is in this context that the Madras High Court observed that it is established law that the person who has acquiesced in the elections cannot be granted any relief by the court when approached by such a person for setting aside, the elections.
(43) The facts of this case are somewhat different. Plaintiff No. 3 seeks, by this plaint, to have the affairs of the society regularised. He has not lost in the election. He has been elected in the election, and yet he wants to pursue the suit. Plaintiff No. 3 was examined in court on objection regarding maintainability having been taken by Mr. R. L. Bhagat. His statement was recorded on 20-4-1989, and he stated that lie wants to continue the suit. He was also questioned by Mr. R. 1.. Bhagat who appears for defendants. From the statement of plaintiff No. 3, reproduced earlier, it is clear that he wants to continue the suit ; that he has authorised the institution of the suit. While dealing with Man Simran Singh, plaintiff No. 3, I can deal with another aspect of the matter also, which is the objection of Mr. R. L. Bhagat that inasmuch as plaintiff No. 3 has not signed the plaint, he cannot be deemed to be a party to the suit. The statement of plaintiff No. 3, reproduced hereinabove clearly indicates that he has authorised plaintiff No. 1 to have the. plaint prepared and engage counsel for the purpose of the suit; that he was informed about the contents of the plaint although he has not actually seen the plaint, and that he lives in Himachal Pradesh, and does not live in Delhi. and for this reason, he did not sign the plaint. The provisions of Order Vi Rule 14 of the Code of Civil Procedure may also be read at this stage, which read as under :- "EVERY pleading shall be signed by the party and his pleader (if any) : Provided that where a party pleading is. by reason of absence or for other good cause, unable to sign the pleading, it may be. signed by any person duly authorized by him. to sign the same or to sue or defend on his behalf."
(44) It is apparent from Order Vi Rule 14 that the plaint need not be signed by everyone of the plaintiffs. The non signing of the plaint may be due to inability because of absence or otherwise. , cited above, also holds that Order Vi Rule 14 is a matter of procedure, and signatures can be obtained at any stage, and it is not permissible to reject the plaint on the ground of non-signing of the same by one of the plaintiffs. In this view of the matter, the suit is not bail for the reason of plaint having not been signed by plaintiff No. 3.
(45) Mr. R. L. Bhagat also stated that the instant suit is not maintainable for the reason that none of the plaintiffs have personal interest in the matter. This proposition merely has to be stated to be rejected. Each and every one of the plaintiffs admittedly has been a member of the Society. Section 15 of the Societies Registration Act postulates resignation, and not removal of any member. It is not disputed in any case that plaintiff No. 3 is a member of the Society. It is averred that plaintiff No. 2 was expelled from the Society, and for this pro- position, what is relied upon is something which has been done by the President of the society. When asked whether the expulsion was preceded by any notice to show-cause that why plaintiff No. 2 be not expelled, no notice to show-cause was brought to my notice. Indeed none has been filed. As such, it is not possible to hold, at least prima fade, that plaintiff NO. 2 has ceased to be a member as, prima facie, rules of natural justice require that before any adverse orders are passed against any person, he must be given notice for the proposed action, that the person affected must be heard, he must have an opportunity to make a representation against the proposed action.
(46) The next contention of Mr. R. L. Bhagat is that the conduct of the plaintiffs has disentitled them from claiming the reliefs which arc claimed in the instant petition.
(47) As regards plaintiff No. 1, Mr. Bhagat says that he has not disclosed that he ceased to be a member of defendant No. I society, as he did not pay arrears of subscription despite reminders issued to him. It is also stated by Mr. Bhagat that plaintiff No. 1 is not entitled to any discretionary relief, inasmuch as he has falsely asserted that he was a life member, whereas he was at one time only an ordinary member.
(48) Mr. Bhagat relies upon photo copies of the ledgers in which notations are made that plaintiff NO. 1 is in arrears, and that reminders were sent to him. Both these contentions of Mr. R. L. Bhagat vis-a-vis plaintiff No. I have to be tested with reference to section 15 of the Societies Registration Act. That proves on has been reproduced here above. That provision, in my view, indicates that once a person has become a member of a society which is registered under the Societies Registration Act, the statute postulates only one manner in which lie can cease to be a member, and that is by his resignation, If any member is in arrears, then it is always open to that person to pay his arrears at any point of time during his lifetime, and the only consequence of being in arrears of three months' subscription is that such a person continues to be a member, but is not permitted to vote as a member. I am fortified in this view, in view of the provisions of section 13 of the Act, reproduced here above, which postulate determination Of disputes between members and the society by the court having original civil jurisdiction in the district, where the society has its principal building. The principal building of the society is located at Rafi Marg, New Delhi. This court shall also be adjudicating upon, in due course, regarding the disputes vis-a-vis the membership of plaintiff No. 1. At this stage one cannot lose sight of the fact that plaintiff No. 1 has written letters to the Society, being letters dated 24th May, 1985 and 10th August, 1986. These letters have been produced by defendant No. 1 society.
(49) In the letter dated 24th May, 1986, Sarbjit Singh, plaintiff No. I, writes to S. S. Bhagat, defendant No. 2, that he has not been receiving intimation of the Annual General Meetings, or any other papers which ordinary members get...... He also states that he seldom remembers to send subscription fee, and he has been making donations etc., and asks Mr. Bhagat to let him know if any subscription, if any, is payable.
(50) The letter dated 10th August, 1986, written by Sarbjit Singh to Mr. J. M. Chopra, defendant No. 3. It has been written that letter to Mr. S. S. Bhagat dated 24th May, 1986, has not been replied to by Mr. Bhagat. He reiterates that he has not been keeping pace with the formalities, and paying subscription etc. as he is away to Europe many times a year for the past many years, and that he would pay the arrears if Mr. S. S. Bhagat would tell him to do so. He also enquires from defendant No. 3 to advise him whether he is a member of defendant No. 1 society, or that lie has been expelled.
(51) In the copy of the letter dated 27-11-1987 produced by the defendants, the plaintiff No. 1 asserts that he is an ordinary member of defendant No. 1, and that he was Vice-President for several years. He also asserts that he is one of the founder. (This is perhaps not correct). He also asks recipient of this letter to call for a General Meeting of all members of defendant No. 1 Society for election of the President.
(52) Letter dated 3-12-1987 written to defendant No. 2, copy whereof has been produced by the defendants, plaintiff No. I says that defendants No. 2 and 3 have been wrongly staling that the plaintiff No. 1 is not a member of defendant No. I. He once again (perhaps erroneously)' asserts that he took part in the founding of defendant No. 1 Society., and states that he has been a member of the Society as evidenced by the magazine of the Society Roopa Lekha, particularly Volume Nos. 32 to 36, which indicate that in the year 1961-1963, plaintiff No. 1 was a member of Council, and in the year 1964-1966, was Vice-President of the Society. He also sent a copy of this letter to all members of the Council.
(53) In spite of so many letters having been written by plaintiff No. I, defendant No. I society, or its Secretary, the to remain silent, and did not reply to plaintiff No. 1 informing him of the manner in which, and the date on which plaintiff No. 1 ceased to be a member of the Society. The Society or its Secretary, did not inform plaintiff No. I as to what amount of subscription was in arrear. They perhaps erroneously assumed that "expulsion" could be ordered; or name could bs re moved from the membership. All that is relied upon, is folio No. 301 of a ledger which bears an endorsement by Shyam Sunder Bhagat, defendant No 2. dated 30-6-1969 that name of Sarbjit Singh removed from membership The endorsement is as follows :- "NAME removed from membership for non-payment of dues in spite of reminders. sd/- ( S. S. Bhagat) 30-6-1969"
(54) It is to be noted that the membership register of the Society, showing that plaintiff No. I was a member of the Society at any point of time prior to 30-6-1969, has not been brought to Court. It is in this register that it would be noted as to when and in what manner plaintiff No. 1 had ceased to be a member of the Society. In any case, the endorsement in the ledger folio for whatever its worth, amounts to an admission that at least till the date of endorsement i.e. 30-6-1969, Sarbjit singh was a member of the Society; that subscription was in arrears. As to what reminders were sent, none of their copies has been produced in Court. Therefore, it is not possible to come to the conclusion that the fact of the amount of arrears of membership fee was made known to the plaintiff, and in what manner. In any case, in view of section 15 of the Societies Registration Act. Sarbjit Singh, plaintiff No. 1, is entitled to status of a member who is in arrears Being a member who is, in arrears, being a member who has disputes with the Society, he can have, by virtue of section 13. those disputes aerated before this Court, as he is doing by this suit. I, therefore, hold that plaintiff No. 1 is enticed to institute the suit: that he has, prima facie, not withheld or suppressed material facts. Shri Sarbjit Singh & Others Vs. All India Fine Arts & Crafts Society & Others.
(55) As regards plaintiff No. 2, M. K. Puri, Mr. R L Bhagat asserts that he was expelled from the Society at a meeting of Council of the Society held an 8-8-1985. He has produced a photo copy of the minutes. The members present at the meeting, do not include M.K. Puri. By that minute, it is recorded that the Council had unanimously decided to expel M. K. Puri, plaintiff No. 2 from the membership of the Society under Article Xvi of the Constitution with immediate effect. Mr. R. L. Bhagat has al?o filed intimation dt. 11-9-1985, which was sent to Mr. M.K. Puri, that the Council of the Society decided to expel him from the membership of the Society under C Article Xvi of its Constitution.
(56) Mr. R. L. Bhagat has also produced a letter from M. .K. Puri, dated. 17-9-1985, written to Dr. M. S. Randhawa, who was then the President of defendant No. I Society. In this letter, M.K. Puri has expressed his shock that his name has been deleted from the Members Register. He stated that no intimation was sent regarding the case against him. and asked Dr. Randhawa to supply a copy of documents relating to the case including the report of the enquiry, if conducted in the matter, so that he may know what really is against him, and what compelled the Executive Council to take such a decision. He-asserts that he seeks justice, and any natural law provides such an opportunity.
(57) Mr. R. L. Bhagat has also produced a letter dated 27-9-1985, written by Or. Randhawa to M.K. Puri. By that letter M. K. Puri had been asked to meet the Secretary of Defendant No. 1 Society, and informed that "he will tell you the reason behind the decision of the Council."
(58) It is stated by Mr. Bhagat that plaintiff No. 2 ought not to be ranted any discretionary relief in view of the fact that he suppressed some material facts. The material facts which are stated to have been suppressed, are that plaintiff No. 3 had written letters to S.S. Bhagat that he has been "falsely implicated" in the suit which has been filed by the plaintiffs: that he 'contested the elections and had won. Neither of these facts are "material 'in the face of mandatory provisions of the Articles & Memorandum of 'Association which require the Annual General Meeting to be held each year within a specified time. the time that is specified by the Articles & Memorandum of Association.
(59) It is asserted by Mr. K. Sawhney who appears for the plaintiffs, that M.K. Puri, defendant No. 2, has not been afforded any opportunity before any action was taken against him. This is denial of natural justice as he has been condemned unheard.
(60) In view of the documents, produced before me, prima facie it appears that there is substance in the contention of Mr. Sawhney. It may well be that the action taken by the Society cannot be sustained, but that will be a matter to be adjudicated upon later. Prima facie, in view of section 13 of the Act, this question can be made the subject-matter of contention, and this Court can adjudicate upon the matter in the suit 'in view of the pleadings already on record.
(61) As regards plaintiff No. 3, the main objection of Mr. R. L. Bhagat is that he has not signed the plaint. Nor has he authorised to file the suit. I have dealt with these contentions, while dealing with the effect of the statement made by plaintiff No. 3 in Court, and need not repeat what I have stated earlier. Sufficient to say that it is not disputed by the defendants that plaintiff No. 3 is currently a member of the Society. He can de hors plaintiffs No. 1 and 2 to maintain the instant suit.
(62) What R. L. Bhagat contends is that the conduct of plaintiff No. 3 is such that he would be disentitled from claiming any relief. For this proposition, Mr. Bhagat relies upon the judgment of the Madras High Court, reported as 1969 Madras 43. In that case, it was held that a member of a registered society, who had contested Section and had lost. was not entitled to maintain a suit, claiming injunction against the society. It is stated that inasmuch as the person who has participated in an election, has acquiesced in the election, therefore, cannot complain about the election. One of the reliefs sought in the instant case, is that a declaration be given that the election which was held in January, 1988, be declared to be illegal.
(63) Mr. Bhagat contends that inasmuch as plaintiff No. 3 was elected to the election, he cannot claim in the suit that the election is illegal. In my view Air 1969 Madras 43 does not help the defendants. It is clearly stated therein as, contended by Mr. Sawhney. that an exception is carved out in that judgment to the effect that the principle of acquiescence is not applicable to the Act which is ultra vires. This is so stated at page 47 of that case. In the instant case, what is contended by the plaintiffs including plaintiff No. 3, is that the elections which are purported to be held by the Society in January, 1988 are ultra vires the provisions of the Memorandum & Articles of Association, and, therefore, illegal and of no effect.
(64) I have reproduced here above the provisions of the Memorandum & Articles of Association which relate to the holding of Annual General Meeting, according to which Annual General Meetings are to be held between April and October of any particular year. Postponing the elections with respect to any particular year beyond October, and in this case January of the next year, is clearly an act which violates the provisions of the Memorandum & Articles of Association, and, therefore, prima facie invalid; and even if plaintiff No. 3 had participated in that election, it is quite open for him to come to realisation that such an election is ultra vires the Memorandum & Articles of Association, and, therefore, of no effect, and it is also open to him to approach this Court under section 13 of the Act for such a declaration. I do not accept the contention of Mr. R. L Bhagat for the defendants that non-holding of Annual General Meeting is directory and not mandatory. Holding of the meet- ing during a specified period is a mandatory provision. This is so also for the reason that the Societies Registration Act itself postulates the annual election and' holding of Annual General Meeting.
(65) Mr. Bhagat's contention that no reasons need to be given for expulsion (by virtue of Article XVI). appears to be violative of the rules of natural justice, as it is the rule of law that no person can be condemned unheard, and the letters written which have been produced by the defendants indicate that plaintiff No. 2 has not been heard, and he has not been informed of the cause for his expulsion, and no notice to show cause was issued to him.
(66) Mr. K. Sawhney has referred to Atr 1941 Bombay 312 (A. S. Krishnan v. M. Sundaram and others), at page 317. (5) It was observed in that case that a person on the roll of the Society as a member, will be a member notwithstanding that he has not paid his subscription.
(67) Mr. K. Sawhney has also referred to the judgment of Privy Council in Nazir Ahmed case, reported as in which it has been clearly laid down that. where there is a power to do a certain thing in a certain, way, then it can be only done in that way, or not at all. The other methods are forbidden.
(68) In the instant case, what is permissible is that which is contemplated by Article Vi regarding holding of Annual General Meeting during the period April and October every year. The meeting held beyond the period prescribed by Article Vi is, therefore, forbidden. It is clear from the notices which have been issued that the accounts for the years 1984-87 were sought to be approved at the Annual General Meeting which is held in 1988. This also makes it clear that the Annual General Meetings have not been held every year, and the accounts of each year for 1984, 1985, 1986 and 1987 have not been approved at the Annual General Meeting called for that purpose during the period April to October of that year.
(69) It is also obvious that there appears to be no Members Register, and it is not possible to tell at any given point of time as to who is and who is not member of the Society. If this is so, it cannot be. said who is and who is not entitled to vote; who is and who is not entitled to stand for election as a member of the Council.
(70) In view of the above, it is necessary, in my view, to appoint an Administrator so that the affairs of the Society can be regularised. Members Register prepared or put in order and brought up-to-date.
(71) In view of the fact that defendant No. 3 has been elected at a meeting which is not in accordance with the Memorandum & Articles of Association, he cannot hold that office. Nor can he be or act as the President of the Society, as was elected at the meeting held in January, 1988, which was held contrary to the provisions of the Memorandum & Articles of Association of the Society.
(72) In view of the above said circumstances, I appoint Shri Vyas Dev Misra, Retired Chief Justice of the High Court of Himachal Pradesh, to be the. Administrator of defendant No. I Society, and give him the following directions- 1.The Administrator will immediately take all steps needed to ensure that the Register of Members is brought up to date, if such register exists. In case the said register does not exist, then he would ensure that the .Membership Register containing all relevant particulars is got prepared; 2. The Administrator will send notices to all (he members of the Society that the Annual General Meeting of the Society shall be held in accordance with the Memorandum & Articles of Association, preferably by middle of July, 1989. In that connection he will take steps to receive nominations for election to the Council, and also for election to each of the offices postulated by the Memorandum & Articles of Association of the Society; and I direct that the elections shall be held under the over all supervision and control of the Administrator in the manner in accordance with the procedure prescribed by the Memorandum & Articles of Association of the Society. The elections shall be by members of the Society who have paid their subscription as on 1-7-1989, and such members shall be entitled to vote at the elections. 3. The Administrator will also make enquiries, and report to this Court as to what terms of lease between the British Council Library and the Society are the duration of the arrangement, and what are the amounts received and receivable by the Society per mensum or per annum under the term of that lease; 4. The Administrator shall have all the powers to give directions to all office bearers of defendant No 1 Society that are needed for the purposes of regularising the affairs of the Society, for compiling the register of members, for issuance of notice of holding of elections to the Council of the Society and the office bearers of toe Society, and to give such order and directions as are necessary for the purposes of ensuring that the. said elections are duly and properly held. The Administrator shall also have the power to declare all results of elections. 5. The Administrator can seek such directions from this. Court which may be necessary to ensure that the elections of the Council and the office bearers are held in accordance with the Memorandum & Articles of Association of defendant No. 1 Society. 6. The Administrator to file his report regarding the elections by 31st July, 1989. All office bearers including defendants No. 2 and 3 shall carry out all the directions of the Administrator for administering the affairs of the Society. 7. The Administrator also to report to the Court the steps that are to be taken for purposes of regularising the affairs of the Society including recommendations regarding usefulness of and termination of service of any employee of the Society. 8. Defendant No. 2, as he is a paid employee of the Society, will continue to function as Secretary of the Society under the supervision, direction and control of the Administrator, and shall carry out all directions issued by the Administrator. All Committees and the Members of Council of defendant No. 1 Society shall exercise their function under the supervision and control of the Administrator till the fresh elections are held. 9. The Administrator shall have, and be given access to all records, papers, documents of the Society. The Secretary of the Society will issue cheques under joint signatures of the Administrator and Himself, and information to that effect shall be sent to the bankers of the society. 10. All cash collections and other collections will be deposited in the back account of the Society on the immediately following working day of the Bank. All such collections will be duly receipted by issuing receipts from the Receipt Books duly numbered serially, having a counterfoil wherein also the amount received will be recorded, and will be entered in the Cash Book as well as the Ledger of the Society, by the persons who are responsible for doing so. 11. The Administrator shall prepare a list of members who are in arrears of subscription, and will notify them to pay the amount of arrears of subscription to the Society within a reasonable time, to be determined by the Administrator. The arrears of subscription and current dues shall be accepted from the persons who are members of the Society at any time up to 1-7-1989. 12. All the expenses incurred by the Administrator, shall be borne by the Society. 13. The Administrator to be tentatively paid a sum of Rs. 10,000 from out of the funds of the Society. He will be entitled to pay unto himself this amount from the bank account of the defendant Society, and defendant No. 2, the Secretary of the Society, or any other person who operates the bank account of the Society, is directed to pay the said amount of Rs. 10,000.00 to the Administrator forthwith. 14. The Administrator is at liberty to approach this Court for further payment. 15. The Administrator is entitled to all out of pocket expenses incurred in connection with the carrying out the directions of this Court, and in connection with holding of the elections. 16. The Administrator shall also be entitled to have the motor vehicle, of the Society for his personal conveyance in connection with the affairs of the Society, he is to be reimbursed of all conveyance and out of pocket expenses incurred by him in connection with the affairs of the Society. 17. Till the elections to the office bearers of the Society, the Secretary of the Society or other office bearers are not to incur any expenses without the approval of the Administrator. 18. The Administrator to ensure that the salary of the employees of the Society are paid regularly and on time during the period he is the Administrator. 19. In case of any doubt or difficulty, any person may approach the Administrator for guidance or direction. 20. This arrangement will be in force till the results of the elections arc announced by the Administrator by the end of July, 1989. The term of this arrangement shall be given to such members of the Society who want to have copies of the same.
Ordered accordingly. dusty.
(73) For further proceedings, adjourned to 3rd August, 1989.