Telangana High Court
M. Sanjay Kumar vs Shanta Educational Society on 10 September, 2024
*THE HON'BLE SRI JUSTICE SUJOY PAUL
+CIVIL REVISION PETITION No.2026 of 2024
% 10-09-2024
#M. Sanjay Kumar
...Petitioner
vs.
$ Shanta Educational Society and others.
... Respondents
!Counsel for the Petitioner: Sri A. Venkatesh, learned Senior Counsel
representing Sri Pasham Mohith.
^Counsel for Respondents: Sri Avinash Desai, learned Senior Counsel
representing Sri Tarun G. Reddy.
<Gist :
>Head Note :
? Cases referred
1. 2011(3) M.P.L.J
2.2002 SCC OnLine Del 474
3. 2019 SCC OnLine TS 2490
4. CRP No.3811 of 2015, dated 11.07.2023
5. (2018) 11 SCC 769
6. (2010) 9 SCC 385
7. (2024) 5 SCC 481
8. (2003) 2 SCC 577
9. (2008) 4 SCC 300
10. 1980 Supp SCC 420
2
SP, J
CRP_2026_2024
IN THE HIGH COURT FOR THE STATE OF TELANGANA
HYDERABAD
****
CIVIL REVISION PETITION No.2026 of 2024
Between:
M. Sanjay Kumar.
...Petitioner
vs.
Shanta Education Society and others.
... Respondents
JUDGMENT PRONOUNCED ON: 10.09.2024
THE HON'BLE SRI JUSTICE SUJOY PAUL
1. Whether Reporters of Local newspapers
may be allowed to see the Judgments? :
2. Whether the copies of judgment may be
Marked to Law Reporters/Journals? :
3. Whether His Lordship wishes to
see the fair copy of the Judgment? :
___________________
SUJOY PAUL, J
3
SP, J
CRP_2026_2024
THE HONOURABLE SRI JUSTICE SUJOY PAUL
CIVIL REVISION PETITION No.2026 of 2024
ORDER:
The interesting conundrum in this petition filed under Article 227 of the Constitution of India is, whether the principle of "nip in the bud" can be applied in a proceeding pursuant to an application filed under Section 23 of the Telangana Societies Registration Act, 2001 (for short 'the Act'). Putting it differently, whether the application filed under Order VII Rule 11 of the Code of Civil Procedure, 1908 (for short 'CPC') was maintainable in the proceedings under the Act and whether the trial Court was justified in rejecting the plaint by order dated 20.03.2024 in I.A.No.1676 of 2023 in S.O.P.No.10 of 2023. Factual Background:
2. The petitioner filed the application with the following prayer:
" i) to declare the actions of the Respondent No.2 to 13 in pressing into service the undated draft resignation letter of the Petitioner by forging the date and removing Petitioner as founding member of the Respondent No.1 as illegal, arbitrary and unjust in law and set aside the same as null and void and not binding upon the Petitioner;4
SP, J CRP_2026_2024
ii) to grant a relief of mandatory injunction thereby directing the Respondent No.2 to 13 to furnish the copies of the undated letter, undated MOU,k board resolution on the basis of which Respondents have pressed into service the undated draft resignation letter of Petitioner and removed Petitioner as founding member of the Respondent No.1.
iii) to grant a relief of mandatory injunction thereby directing the Respondent No.1 to 13 to furnish all the financial accounts, books and statements of the Petitioner Society from 2006-07 to the present financial year before this Hon'ble Court.
iv) to appoint an Advocate Commissioner to verify the vouchers, receipts, donations, balance sheets and accounts of the Respondent No.1 Society.
v) To consequently grant a Relief of Perpetual Injunction thereby restraining the Respondents 2 to 13, their representatives, employees and all persons acting on behalf of Respondent No.2 to 13 from illegally stopping the Petitioner from entering into the registered office premises and "St.Peters Engineering College" located at Kompally, Medchal of Respondent No.1 Society.
vi) To grant a relief of Permanent injunction thereby restraining the Respondents 2 to 13 from in any way accepting, honouring, permitting and allowing any kind of interference in the matters of pertaining to the admission, appointments and administration of educational institution named as "St.Peters Engineering College" located at Kompally, Medchal of Respondent No.1 Society.
vii) By awarding the costs of the proceedings and other incidental expenses/charges etc., incurred to by the Petitioner; and
viii) To grant any such relief(s) as deemed fit and proper in the circumstances of the case and to which the Petitioner is legally entitled to, in the interest of justice."
5
SP, J CRP_2026_2024
3. Upon receiving notice, the Society entered appearance and filed an application under Order VII Rule 11 of the C.P.C. for rejection of the plaint. In turn, the petitioner filed his counter. After hearing both the parties, the Court passed impugned order dated 20.03.2024 and rejected the plaint. Contention of the Petitioner:
4. Learned Senior Counsel for the petitioner raised two fold submissions. Firstly, it is submitted that the provisions of CPC are not borrowed under the Act. The petitioner also took an objection of maintainability of said application preferred under Order VII Rule 11 of CPC. In the impugned order, the said objection has not been dealt with. Since Order VII Rule 11 of CPC is not applicable, the question of rejection of plaint does not arise. The 'Plaint' is defined under Order VI of CPC. The plaint cannot be equated with 'application' filed under Section 23 of the Act. By placing reliance on Madhya Pradesh High Court judgment in case of Kanta vs. Arvind Tare 1, it is submitted that the word 'Plaint' has a definite connotation under the CPC. The same cannot be stretched to include application under Section 23 of the Act. By 1 2011(3) M.P.L.J 6 SP, J CRP_2026_2024 referring the language employed in Section 23 of the Act, it is submitted the said section provides two remedies. One of which is under the Arbitration and Conciliation Act, 1996. The Delhi High Court in the case of Plaza Garments vs. Textile Apparels 2, opined that the provisions of Order VII Rule 11 of CPC cannot be made applicable to the arbitration proceedings. Applying the same analogy for remaining remedy under Section 23 of the Act, the rejection of plaint cannot be ordered in exercise of power under Order VII Rule 11 of CPC. For the same purpose, the judgment of this Court in Gulam Yazdani vs. Mumtaz Yarud Dowla Wakf 3 is referred. Learned Senior Counsel for the petitioner then relied on the judgment of High Court of Andhra Pradesh at Amaravati in Prati Chandrasekhar Rao v. George Club 4, to bolster the submission that if a member of society is expelled from the rolls of society, the application under Section 23 of the Act is maintainable. Another judgment of High Court of Andhra Pradesh at Amaravti in W.P.Nos.1343 and 3355 of 2023, dated 21.02.2023, is referred to show that in the said case, the applicants allegedly tendered resignation and despite that, it was 2 2002 SCC OnLine Del 474 3 2019 SCC OnLine TS 2490 4 CRP No.3811 of 2015, dated 11.07.2023 7 SP, J CRP_2026_2024 held that the dispute between them and society can be adjudicated in an application filed under Section 23 of the Act.
5. The next limb of argument of learned Senior Counsel for the petitioner is that application under Order VII Rule 11 of CPC can be decided solely based on plaint averments. The case of petitioner is that upon receiving certain assurances regarding refund of his contribution, he tendered unsigned conditional resignation. The acceptance of resignation was never communicated to the petitioner. The question whether such resignation is acceptable or not is to be decided on merits after full-fledged trial. The impugned order passed without putting the matter to trial is bad in law and runs contrary to the order of this Court in C.R.P.No.217 of 2019, dated 18.02.20219. Stand of respondents:-
6. Learned Senior Counsel, submits that in Terapalli Dyvasahata Kumar v. S.M.Kantha Raju 5, which is arising out of the Andhra Pradesh Societies Registration Act, 2011, the provisions of CPC were held to be applicable in the proceedings 5 (2018) 11 SCC 769 8 SP, J CRP_2026_2024 under Section 23 of the Act. Apart from this, Section 141 of CPC is relied upon to submit that the instant proceedings were civil in nature and therefore, Section 141 of CPC can be pressed into service.
7. By placing reliance on the definition of 'Member' mentioned in Section 2 (h) of the Act, learned Senior Counsel for respondents submits that the petitioner cannot be treated to be a member after having resigned from the membership of a Society. The averments of paragraph No.31 of the plaint averments and e-mail dated 18.08.2022 of the petitioner filed along with material papers are relied upon to show that factum of resignation is clear from plaint averments. The resignation once tendered, does not require any acceptance. The scope of interference under Article 227 of Constitution of India is very limited. Reliance is placed on the judgment of Apex Court in Jai Singh vs. Municipal Corporation of Delhi (MCD) 6. Relying on the said ratio, which was followed by this Court in C.R.P.No.1391 of 2024 and batch, dated 16.07.2024, learned Senior Counsel for respondents strenuously contended that the petitioner, who had tendered resignation was no more a 6 (2010) 9 SCC 385 9 SP, J CRP_2026_2024 'member' of the Society and therefore, his application/plaint was rightly rejected.
8. The parties confined their arguments to the extent indicated above. I have heard the parties at length.
9. The parties have taken diametrically opposite stand about the applicability of Order VII Rule 11 of CPC in the proceedings under Section 23 of the Act. Much emphasis is laid by the learned Senior Counsel for respondents on the judgment of Supreme Court in the case of S.M. Kantha Raju (supra), which travelled to Apex Court from Andhra Pradesh High Court and relates to the same Act namely Andhra Pradesh Societies Registration Act, 2001. The Supreme Court in the said case at opined as under:
"13. As the District Judge correctly states in the impugned judgment dated 17.01.2005, where the expression "District Court" is not defined by the special enactment in which it occurs, it must necessarily take with it all the trappings that go along with a District Court that is established under the general law. This would necessarily mean that the provisions applicable to District Courts generally would apply, and that therefore the provisions of the Code of Civil Procedure, when it comes to determining the jurisdiction of such District Court, would necessarily apply.
15. The same position obtains in the present case as Section 23 of the 2001 Act also does not provide for any 10 SP, J CRP_2026_2024 procedure for the conduct of the application in the District Court concerned. This judgment would therefore apply on all fours to the facts in the present case."
(Emphasis Supplied)
10. Before dealing further on this aspect, it is apposite to reproduce two relevant provisions of the Act. In Section 2 (h), the member of society is defined as under:
"Section 2: Definitions:
...
(h) 'Member' means a person, individual or body corporate, who/which, having been admitted to membership in any society has not resigned or ceased to be a member, or been removed from membership, in accordance with the bye-laws of that society;"
The application is admittedly filed under Section 23, which reads thus:
"Section 23: Dispute regarding management:
In the event of any dispute arising among the Committee or the members of the society, in respect of any matter relating to the affairs of the society, any member of the society may proceed with the dispute under the provisions of the Arbitration and Conciliation Act, 1996, or may file an application in the District Court concerned and the said court shall after necessary inquiry pass such order as it may deem fit."
11. A plain reading of Section 23 of the Act leaves no room for any doubt that it prescribes a forum for resolution of disputes among the committee or the 'member' of the society. Thus, only a 'member' of society can raise a dispute which can be adjudicated 11 SP, J CRP_2026_2024 in exercise of power under Section 23. The definition of 'member', in no uncertain terms, makes it clear that only such person can be treated to be a member, who has not resigned or seized to be a 'member'.
12. Learned Senior Counsel for the petitioner placed reliance on certain judgments of High Court to submit that in case where the 'member' had either resigned or tendered resignation were treated to be entertainable under Section 23 of the Act. It is relevant to consider those judgments minutely. In C.R.P.No.217 of 2019, there was serious dispute between respondent Nos.1 to 6 and petitioner and respondent Nos.7 to 12 as to whether, who is lawfully elected officer bearers. Thus, whether or not the parties to that litigation were 'members' was not a question. Hence, the said judgment has no application in the instant case.
13. Likewise, in C.R.P.No.3811 of 2015 challenge was relating to expulsion from membership. The Court has not considered Section 2 (h) i.e,. definition of the 'member'. The order passed in ignorance of statutory provisions which goes to the root of the matter and touches upon the question of maintainability of dispute/application under Section 23 of the Act is distinguishable. 12
SP, J CRP_2026_2024 The Apex Court in Bilkis Yakub Rasool vs. Union of India 7, held that 'if a judgment is rendered in ignoratium of a statute or a binding authority, it becomes a decision per incuriam'.
14. The order passed in W.P.Nos.1343 and 3355 of 2023 is heavily relied by the learned Senior Counsel for the petitioner. The facts demonstrate that resignation of Anam Rama Kishore Reddy was under challenge in another Writ Petition, wherein interim order was granted. In the peculiar facts of that case, this Court opined that tendering of resignation cannot be treated as a disputed fact. The said order founded upon peculiar factual matrix of that case where resignation was stayed cannot be pressed into service.
15. In the instant case, it is noteworthy that the petitioner in his application under Section 23 of the Act pleaded as under:
"31. ...It is once again reiterated that, the undated resignation letter and MOU were signed by the Petitioner only upon the assurance by the Respondents that the said documents shall be pressed into service upon receiving the above amount of INR 13,43,00,000/- and considering the fact that the said amounts were not received by Petitioner, the acts of the Respondents in accepting the alleged resignation of Petitioner is illegal, arbitrary and is liable to be set aside."
(Emphasis Supplied) 7 (2024) 5 SCC 481 13 SP, J CRP_2026_2024
16. Along with said application, petitioner filed an e-mail dated 18.08.2022 relating to withdrawal of resignation. In the said e- mail, it is avered that 'As you know the reasons and facts that I have given my resignation letter on a white paper without mentioning the date to the Arbitrator. Now, I withdraw my resignation'.
17. A conjoint reading of the aforesaid pleadings, the prayer clause of application and e-mail makes it clear like cloudless sky that the petitioner had submitted his resignation. Once, he has tendered his resignation, he does not fall within the definition of 'member' mentioned in Section 2(h) of the Act.
18. In the opinion of this Court, it does not make much difference whether Order VII Rule 11 of CPC was applicable or not. If on the basis of admitted facts, the Court has taken a decision regarding maintainability it cannot be said that the said decision is illegal and devoid of jurisdiction.
19. In the peculiar facts of this matter, where factum of tendering resignation is not disputed, no fault can be found in the 14 SP, J CRP_2026_2024 impugned order whereby the Court rejected the application. Such rejection will not preclude the petitioner from seeking judicial review of the order/action before appropriate forum. The petitioner will have efficacious remedy of filing suit against the society.
20. The principle 'nip in the bud' is evolved in order to shorten the litigation and to save precious time and energy of litigants and the Courts. Thus, whether the provision Order VII Rule 11 of CPC was applicable or not, will not make much difference. In the case of this nature where foundational facts to determine the question of maintainability/jurisdiction are clearly available, the Court has inherent power to examine whether as per the definition of Section 2 (h) read with Section 23 of the Act, the dispute was maintainable. A conjoint reading of Section 2 (h) and Section 23 of the Act makes it clear that a person, who has tendered resignation cannot be treated to be a 'member' and cannot raise dispute under Section 23 of the Act. This is trite that if language of statute is plain and unambiguous, it must be given effect to 15 SP, J CRP_2026_2024 irrespective of consequences (see Nasiruddin vs. Sita Ram Agarwal 8).
21. This Court finds support in its view from the judgments of Supreme Court in the cases of Krishan Kumar Birla vs. Rajendra Singh Lodha 9 and Grindlyas Bank Ltd. vs. Central Govt. Industrial Tribunal 10. The Apex Court in the case of Krishan Kumar Birla (supra) at relevant portion held as under:
"116. ...A Court is entitled to dismiss a lis at the threshold if it is found not maintainable. The Court even in absence of any rule must take the precaution of not indulging in wasteful expenditure of its time at the instance of the litigants who have no case at all. We do not, therefore, find any legal infirmity in the Rules."
The Apex Court in the case of Grindlays Bank Ltd. (supra) at relevant portion held as under:
" 6. ...it is a well-known rule of statutory construction that a Tribunal or body should be considered to be endowed with such ancillary or incidental powers as are necessary to discharge its functions effectively for the purpose of doing justice between the parties. In a case of this nature, we are of the view that the Tribunal should be considered as invested with such incidental or ancillary powers unless there is any indication in the statute to the contrary. We do not find any such statutory prohibition. On the other hand, there are indications to the contrary."8
(2003) 2 SCC 577 9 (2008) 4 SCC 300 10 1980 Supp SCC 420 16 SP, J CRP_2026_2024
22. The view taken by the trial Court is a plausible view. There was no prohibition under the Act to apply the principle 'nip in the bud' at the stage when necessary ingredient for exercising the inherent power which is available with the Court. Whether strict principle flowing from Order VII Rule 11 of CPC is applicable or not is kept open to be decided in an appropriate case.
23. At the cost of repetition, in my considered opinion judgment, in the peculiar factual matrix of this case, no legal flaw can be found in the impugned order dated 20.03.2024 and while affirming the said order, it is made clear that liberty is reserved to the petitioner to avail appropriate remedy under the law.
24. The Civil Revision Petition is dismissed with the aforesaid liberty. It is made clear that this Court has not expressed any opinion on merits. There shall be no order as to costs. Miscellaneous applications, if any, pending shall stand closed.
______________________ JUSTICE SUJOY PAUL Date: 10.09.2024 Note:
LR copy be marked.
GVR/NVL