Bhoraniya vs Anupam on 11 March, 2010

[Cites 10, Cited by 0]

Gujarat High Court

Bhoraniya vs Anupam on 11 March, 2010

Mr.Baiju Joshi, learned advocate appearing for the respondent-Caveator waives service of notice of Rule on behalf of the respondent-Society. On the facts, and in the circumstances of the case and with the consent of the learned counsel for the respective parties, the petition is being heard and finally decided, today.

2. The present petition has been preferred invoking the provisions of Articles 226 and 227 of the Constitution of India, laying challenge to judgment and order dated 28.01.2010, rendered by the Gujarat State Cooperative Tribunal, Ahmedabad ( the Tribunal , for short) in Revision Application No.234/2009, whereby, the order dated 24.11.2009, passed by the Board of Nominees, Rajkot, below application at Exh.4, in Lavad Suit No.464/2009, has been confirmed.

3. Briefly stated, the facts of the case, emerging from the record are that the respondent herein, Shri Anupam Co-operative Housing Society Limited, which is a Society registered under the Gujarat State Co-operative Societies Act, 1961 ( the Act , for short), instituted Lavad Suit No.464/2009 before the Board of Nominees, Rajkot. In the said Suit, the respondent herein, inter-alia, prayed that the petitioner (who is one of the members of the Society), his servants or agents, be restrained from carrying on construction on Plot No.6, as the construction being carried on by him is without permission, and is being made for commercial purposes, and that a permanent injunction to this effect, may be granted. The petitioner, who is the defendant in the said Suit, filed a written statement contending that in the Annual General Meeting of the respondent-Society held on 17.10.2006, it was resolved by Resolution No.7, that the Society would execute Deeds in favour of its members or their heirs, in respect of all the plots on which houses of the members are constructed and thereafter, the Society would be dissolved. The case of the petitioner is that the respondent has executed a Registered Sale Deed dated 26.11.2008, in favour of the petitioner and as such, the petitioner has ceased to be a member of the respondent-Society, and has exclusive right and title in Plot No.6, therefore, he is within his rights to construct a six-storey building, thereupon. The case of the respondent-plaintiff before the Board of Nominees is that no dissolution of the Society, in accordance with the provisions of the Act has taken place, therefore, the petitioner is still a member of the Society. As no sanction/permission has been obtained from the Society and, as the permission for construction granted by the Trajpar Gram Panchayat has been cancelled by the Morbi Nagar Palika, the construction being raised by the petitioner is wholly without permission/sanction from the competent authority. Along with the Suit, the respondent-Society preferred an application for grant of an interim injunction against the petitioner, before the Board of Nominees. By order dated 24.11.2009, the Board of Nominees granted an interim injunction in favour of the respondent-Society, by restraining the petitioner from carrying on any further construction. Aggrieved thereby, the petitioner approached the Gujarat State Co-operative Tribunal, by way of revision. By impugned judgment and order dated 28.01.2010, the Tribunal dismissed the Revision Application filed by the petitioner, thereby confirming the order of the Board of Nominees, giving rise to the filing of the petition.

4. Mr.R.C.Kakkad, learned counsel for the petitioner has made elaborate submissions, the crux of which is reproduced hereinbelow :

(A) The petitioner is no longer a member of the respondent-Society, after execution of the Sale Deed dated 26.11.2008 in his favour by the Society. The petitioner is now the sole owner of the Plot No.6, on which he is carrying out construction, and has exclusive right and title over the same. As such, the present dispute is not a dispute between the Society and its members, or between members of the Society inter-se as, after execution of the Sale Deed, all rights have been transferred to the petitioner. As the petitioner is no longer a member of the respondent-Society, the Board of Nominees has no jurisdiction to entertain the Lavad Suit, as per provisions of Section-96 of the Act, therefore, the order passed by the Board of Nominees is without jurisdiction and is null and void. Similarly, the impugned judgment and order of the Tribunal confirming the order of the Board of Nominees, is without jurisdiction and is null and void.

(B) Neither the Board of Nominees nor the Tribunal has dealt with this aspect specifically in the impugned orders, though it was raised by the petitioner, not only orally, but also in the written submissions filed before the Tribunal.

(C) Initially, there were 66 plots in the respondent-Society. In all, 57 members constructed their houses on the plots allotted to them, but at present only 37 members are there in the Society. The petitioner is no longer a member of the Society, after execution of the Sale Deed in his favour, therefore, there is no need to obtain the sanction of the Society for construction upon Plot No.6, belonging to him.

(D) Trajpar Gram Panchayat has rightly accorded permission to the petitioner to raise the construction on his plot of land. No doubt, the Taluka Development Officer ( T.D.O. , for short) has cancelled the permission granted by the said Panchayat by order dated 19.06.2009, the petitioner is contemplating action in the appropriate forum, against this order. However, there is an ongoing dispute between Trajpar Gram Panchayat and Morbi Nagar Palika, regarding territorial jurisdiction and in this context, until the dispute is resolved, it cannot be said that the plot of the petitioner falls within the jurisdiction of the Morbi Nagar Palika, therefore, the permission granted by the Trajpar Gram Panchayat is perfectly legal and valid.

The petitioner has constructed five storeys out of six, and it is denied that the building is being constructed for commercial purposes.

(E) The respondent-Society, with malafide intentions and ulterior motive, and with the objective of extracting a large sum of money from the petitioner, has very smartly filed the Lavad Suit before the Board of Nominees, which conduct should be taken note of by this Court. The petitioner has spent lacs of rupees in constructing the building and it is obvious that a five-storey building could not have been put up by the petitioner in a fortnight. At the stage, where the building of the petitioner is almost on the verge of completion, the respondent-Society has filed the Suit and obtained the interim injunction with the sole object of forcing the petitioner to part with a huge sum of money, in order to settle the matter. The respondent has not raised similar objections against other persons who are carrying on similar constructions, therefore, this Court may grant the prayers made in the petition.

(F) The petitioner will not be relying upon the documents produced at Annexure-G in the petition, as they have been obtained under the Right to Information Act, after the passing of the impugned orders.

5. Mr.Baiju Joshi, learned counsel for the respondent-Society has vehemently opposed the submissions made by the learned counsel for the petitioner, by contending that :

(A) After passing of Resolution No.7 dated 26.10.2006 in its Annual General Meeting, no further action has been taken by the respondent-Society to cancel its registration or to dissolve the Society. Referring to the provisions of Sections-19 and 20 of the Act, it is submitted that the Society can be dissolved only in the event that the Registrar makes an order cancelling the registration of a Society and after such order is published in the Official Gazette, the Society shall be deemed to be dissolved from the date of such order, and shall cease to exist as a Corporate body. In the present case, this procedure has never taken place and in the absence of the procedure prescribed under the Act, as of today, the Society has not been dissolved and the petitioner is still a member of the respondent-Society.

(B) The so-called Sale Deed being referred to by the petitioner is, in fact, not a Sale Deed, but is a Deed for handing over the plots, without any consideration, after the dissolution of the Society. It will not become effective till such time as the Society stands legally dissolved, which is not the case. The Society still exists and the audit has also taken place in 2009, which would not have taken place, had the Society been deregistered or dissolved.

(C) The respondent-Society is a Tenant Co-ownership Society in which the land belongs to the Society, and the superstructure belongs to the members. The Society purchased the land and obtained Non-Agricultural use permission, and thereafter plots are given to the members to construct the superstructure. As such, prior sanction of the Society, before carrying out any kind of construction, is mandatory as per the principles of law laid down in :

(1)

Shivaji (Vejalpur) Co-op. Hosg. Society Ltd. & Anr. Vs. State of Gujarat & Anr. reported in 2010 (1) GLH 372, (2) Mulshanker Kunverji Gor and Ors. Vs. Juvansinhji Shivubha Jadeja reported in 1979(20)G.L.R.878(F.B.), (3) New India Cooperative Housing Society Limited Vs. Municipal Corporation of Greater Mumbai & Anr. reported in (2008) 9 Supreme Court Cases 694, (4) State of Maharashtra and Ors. Vs. Karvanagar Sahakari Griha Rachana Sanstha Maryadit & Others reported in (2000) 9 Supreme Court Cases 295, (wherein AIR 1989 Bombay 392 has been confirmed).

(D) The respondent-Society has produced a copy of the Gazette before the Board of Nominees,in order to show that Survey No.77, on which the plot of petitioner is located, is a part of Morbi Nagar Palika and, as such, permission for construction granted by the Trajpar Gram Panchayat has been rightly cancelled, by the T.D.O., by order dated 19.06.2009. Till date, the petitioner has not challenged the said order, therefore, the construction of the petitioner is, at present, wholly without sanction, as the sanction granted earlier by the Gram Panchayat has been cancelled. The petitioner has not stopped the construction, after cancellation of the permission and as the construction is without sanction of the competent authority, the order of the Board of Nominees, as confirmed by the Tribunal, is perfectly legal and valid.

(E) The Board of Nominees as well as the Tribunal have taken into consideration the points raised by the petitioner and it has been held that as the Society has not been dissolved and the petitioner is still a member of the Society, therefore, the Board of Nominees could entertain the Suit. The orders of the Board of Nominees and the Tribunal have been passed in proper exercise of jurisdiction vested in them.

(F) The petitioner has made wild allegations against the respondent-Society by stating that the Society has malafide intentions of extracting a huge sum of money for ulterior motives, from the petitioner. These allegations have not been made before the Board of Nominees or the Tribunal, but have been raised only before this Court. There is not a whisper in the pleadings, either before the Board of Nominees, the Tribunal or even in the present petition, to this effect, therefore, the Court may take serious note of this aspect and petition may be dismissed by imposing heavy costs.

(G) There are concurrent findings of fact recorded by the Board of Nominees as well as the Tribunal, on the basis of the material on record, which are perfectly legal, valid and in accordance with law, and the impugned orders may not be interfered with.

6. In rejoinder, Mr.R.C.Kakkad, learned counsel for the petitioner, while reiterating the submissions made earlier, has emphasized that the Board of Nominees or the Tribunal have not recorded any specific finding on the aspect that after execution of a Registered Deed dated 26.11.2008 in favour of the petitioner, the petitioner has ceased to be a member of the respondent-Society, as the Society has handed over the plot of land on which he is carrying out construction, to him. If the respondent-Society has not cared to initiate procedure for cancellation of registration, that will not affect the rights of the petitioner, as he is no longer a shareholder of the Society and all shares have been taken back from him.

No other point has been urged by the learned counsel for the respective parties.

7. I have heard the learned counsel for the respective parties at length and in great detail, perused the averments made in the petition, contents of the impugned orders and other documents on record. Before deciding the petition, it is necessary to keep in mind that the same is directed against the impugned judgment and order of the Tribunal, whereby it has confirmed the order of the Board of Nominees, granting an interim injunction in favour of the respondent-Society. The Lavad Suit is pending adjudication and, as such, the petition is directed against an order made at the interlocutory stage.

8. It has been emphatically contended by the learned counsel for the petitioner that the order of Board of Nominees is without jurisdiction as it could not have entertained the Suit, as the petitioner is no longer a member of the respondent-Society. The plea is that consequently, the order of the Tribunal, whereby the said order has been confirmed, is also without jurisdiction and both the said orders are null and void. In regard to this submission, it is necessary to refer to the findings arrived at by the Board of Nominees in its order dated 24.11.2009. It has been stated in the said order that, even though the Society resolved in its Annual General Meeting dated 17.10.2006 that it would hand over the plots to its members by executing Deeds in their favour, and thereafter dissolve the Society, no such procedure as envisaged by law has taken place for dissolution of the Society. The Society is still in existence and the petitioner continues to be a member, thereof. Confirming this finding of the Board of Nominees, the Tribunal has held that no evidence has been produced by the petitioner regarding the dissolution of the Society, and no proposal has been sent to the competent authority by the said Society, for cancellation of its registration and for its dissolution. The Tribunal has found that the Society cannot be dissolved merely by passing a Resolution in the Annual General Meeting, but the approval of the competent authority for cancellation of registration and publishing the order in the Official Gazette is necessary, as per procedure prescribed under the Act. There is a specific finding that, as the petitioner is still a member of the respondent-Society, he is bound by the bye-laws of the Society and has to obtain permission from the Society, before construction is carried out on the plot allotted to him.

9. The Board of Nominees as well as the Tribunal, in their respective orders have further found that the permission for construction, granted by the Sarpanch of the Trajpar Gram Panchayat, does not bear the signature of the office-bearers of the Society and even otherwise, as the T.D.O. has cancelled the said permission, by order dated 19.06.2009, the construction carried out by the petitioner is wholly without permission/sanction from any authority. It has been stated in the impugned order of the Tribunal that the petitioner has constructed a five-storey building at his own risk and cost, which cannot be encouraged, when the construction is carried out without approval of the plans from the competent authority, that is Morbi Nagar Palika. It is further stated in the impugned order that the building being constructed by the petitioner is consisting of 12 flats, which suggests that the petitioner intends to sell the flats to 12 different families. It has further weighed with the Tribunal that permission from the Morbi Nagar Palika before carrying out the construction is necessary, as the entire area is located in a zone which is prone to earthquakes and, as such, there can be possibility of damage to the foundations of the neighbouring buildings. By its impugned order, the Tribunal has confirmed the findings recorded by the Board of Nominees on all points, and has, after discussing them at length in the impugned order, held that the construction of the petitioner is being carried out without permission from the competent authority and the order granting interim stay by the Board of Nominees, has been confirmed, and the Revision Application filed by the petitioner has been dismissed.

10. In order to appreciate the issues raised in the petition, it would be fruitful to advert to the provisions of Section-20 of the Act, which provides for cancellation of registration. The section is reproduced hereinbelow :

"20.Cancellation of registration:- (1) The Registrar shall make an order cancelling the registration of a society if it transfers the whole or its assets and liabilities to another society, or amalgamates with another society, or divides itself into two or more societies, or if its affairs are wound up or it has not commenced business within a reasonable time of its registration or has ceased to function.

(2)

An order made under sub-section (1) shall be published in the Official Gazette.

(3) The society shall, from the date of such order of cancellation, be deemed to be dissolved and shall cease to exist as a corporate body.

11. As contemplated by the above-quoted provisions of law, as per Section-20(1), the Registrar is the competent authority to cancel the registration of a Society and any order made under Sub-section (1) is required to be published in the Official Gazette, as per Sub-section (2). Sub-section(3) provides that the Society shall be deemed to be dissolved from the date of the order of cancellation, from which date it ceases to exist as a body Corporate. The findings of the Board of Nominees and the Tribunal in their respective orders, that there is no material on record to show that the registration of the respondent-Society has been cancelled and the Society has been dissolved, appear to be well-founded and based on a proper appreciation of material on record. The passing of the Resolution dated 17.10.2006 in the Annual General Meeting, to the effect that the Society would execute Deeds in favour of its members, handing over the plots of land and thereafter the Society would be dissolved, would not, of itself, absolve the respondent-Society or the petitioner, from following the procedure prescribed by law. There is no material to suggest that the procedure prescribed in Section-20 of the Act has been followed. In that case, the Society is not dissolved and still exists, and the petitioner is a member thereof. In this light, the issue regarding jurisdiction of the Board of Nominees and the Tribunal is not at all relevant, as the dispute falls squarely under the provisions of Section-96 of the Act. The submissions made by the learned counsel for the petitioner, therefore, cannot be accepted. The registered Deed dated 26.10.2006, referred to as Sale Deed by the petitioner would, come into effect only on the dissolution of the Society, which event has not yet taken place. There are concurrent findings of both the Courts below, based on proper appreciation of the material on record. The submissions made on behalf of the petitioners have been properly dealt with by passing well-reasoned orders, by both the Courts below.

12. It is not disputed by the learned counsel for the petitioner that permission to carry out construction on his plot, accorded by the Trajpar Gram Panchayat, has been cancelled by order dated 19.06.2009 of the T.D.O. Though it has been submitted that the petitioner shall take appropriate action, before the appropriate forum, to challenge the said order, the fact remains that, as of today, no challenge has been made to this order. The result is that no permission for construction exists, meaning thereby that the petitioner has been carrying out construction, without permission from the competent authority, as rightly found by both the Courts below.

13. The question whether the Trajpar Gram Panchayat has territorial jurisdiction in the area where Survey No.77, on which the plot of petitioner is situated, or whether the same falls under the jurisdiction of the Morbi Nagar Palika, does not arise for determination in the present petition, therefore, no observation can be made regarding this aspect. As regards the submission of the learned counsel for the petitioner that the orders of the Board of Nominees and the Tribunal are silent on the aspect that the Society has no right or title over the plot of land, after execution of the Deed dated 26.11.2008, it can only be reiterated that both the Courts below have found that the Society has not been dissolved, as no evidence to this effect has been produced by the petitioner, and the petitioner is still a member of the Society. In this view of the matter, when the Society itself has not been dissolved, the Deed, though registered, would not come into effect, therefore, this submission advanced by the learned counsel for the petitioner is without substance.

14. The orders of both the Courts below have been passed after a proper scrutiny of the material on record, after dealing with the submissions advanced by the rival parties, including the written submissions of the petitioner. This is evident from a perusal of the said impugned orders of the Board of Nominees and the Tribunal. In fact, the impugned order of the Tribunal contains a detailed extraction of the pleadings and submissions made by the parties. In this view of the matter, it cannot be said that the contentions raised by the learned counsel for the petitioner before the Courts below have not been dealt with.

15. A contention has been advanced, rather emphatically, by the learned counsel for the petitioner to the effect that the Suit has been filed by the respondent-Society with a malafide intention and with an ulterior motive of extracting a large sum of money from the petitioner, for extraneous reasons. A strong objection has been raised to this, by the learned counsel for the respondent-Society. It is amply clear, after going through the material on record, that the allegations of malafide has not been raised before both the Courts below, or even in the memorandum of petition itself. No material has been produced on record by the petitioner in the present petition, or at any prior stage, to substantiate these allegations against the respondent-Society. As such, wild allegations have been made in the air. It is a well-settled position of law, that a plea of malafides has to be specifically made, and proved on the basis of material on record. However, without doing so, certain reckless allegations have been made, which are unsubstantiated and unsupported, by even an iota of evidence, leave alone having any basis in pleadings. Such submissions of the learned counsel for the petitioner are, therefore, being rejected, outright.

16. It cannot be lost sight of, that the impugned judgment and order of the Tribunal has been made in interlocutory proceedings, and the Suit is still pending adjudication. The Courts below have found that a prima-facie case is made out in favour of the respondent-Society and that the balance of convenience is also in its favour. Concurrent findings of fact have been recorded by both the Courts below, and both the impugned orders of the Board of Nominees and the Tribunal, do not suffer from any legal infirmity or improper exercise of jurisdiction so as to justify the interference of this Court.

The petition deserves to be dismissed. It is, accordingly, dismissed. Rule is discharged. There shall be no orders as to costs.

(Smt. Abhilasha Kumari, J.) ~gaurav~ Top

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