Vs. Friends Central Government Employees House Building Society  INSC 1478 (21 November 1996)
Punchhi, K. Venkataswami Venkataswami. J.
office of the second respondent issued a notice on 9.5.1980 to the first respondent
Society (hereinafter referred to as "the Society") to show cause
within 15 days from the date of receipt of that notice as to why the Managing
Committee (then in office) of the Society should not be removed and an
administrator appointed in its place.
said show cause notice signed by the Deputy Registrar (H) pointed out several
irregularities committed by the said Managing Committee. Immediately the
Society through its then President moved the Delhi High Court by filing C.W.
No. 661 of 1980 challenging the said show cause notice. Ultimately that writ
petition was disposed of on the basis of settlement arrived at between the
parties and the High Court passed an order on 22.5.1981 based on a memo of
relevant clause in the order is clause (iii) which reads as follows :-
"That the society will send notice, by registered post acknowledgement due
to all the persons who are in arrears with the society in respect of an amount
exceeding Rs. 500/- By this notice, these persons will be asked to file the
requisite affidavits and pay the balance of the amount due from them as shown
in column 9 of the Annexure P/32 for the plots proposed to be allotted to them.
Which amount includes interest at the rate of 15% per annum from 1st January 1979
upto 30th April. 1981 or an earlier date till which they were in default. The
requisite affidavits and the crossed bank drafts in favour of the petitioner
society for the amounts demanded in the notices (as shown in column 9 of the
Annexure P/32) must reach the society within one month from the date of despatch
of the said notice. The failure to submit the requisite affidavits or to make
payment within the time shall finally disentitle the person in default from
participating in the elections as also. from getting the allotment of a plot.
No further relaxation, whatsoever, shall be made and the present relaxation
shall not be treated as a precedent.
the case of the Society that pursuant to the above extracted clause in the
Compromise order. the appellant was called upon to file an affidavit (the form
of which was enclosed along with notice) within the time prescribed therein.
The said notice was served on the father of the appellant as at the relevant
time. the appellant was in the United States of America. As the appellant did not file the affidavit in time, he
was removed from the Society's membership and consequently he lost the right of
allotment of the plot even though admittedly he had paid the entire cost of the
plot and was not in arrears of any kind on the date when the first respondent
issued a notice calling upon the appellant to sign the affidavit. The affidavit
required such member of the Society who was entitled to get allotment to state
on oath that neither he nor his spouse owns any plot or house in Delhi. It is to be noted at this stage
that such a declaration was already signed and filed by the appellant as
required under Bye-law (ii) and after getting such declaration he was admitted
as a member of the Society.
appellant aggrieved by the action of the Society removing him from its
membership moved the Delhi High Court by filing C.M.P.No. 881/1983 in
C.W.NO.661/80 in which the High Court earlier passed the order on the basis of
the compromise memo giving certain directions to the Society.
to the appellant, the said C.M.P. was to permit him to file the affidavit even
though he was not liable to file such an affidavit in terms of clause (iii) of
the High Court order. The High Court did not agree with the contention of the
appellant that he was not liable to file such an affidavit and he having come
to the Court after an inordinate and unexplained delay. he was not entitled to
the relief sought for. On that ground the High Court rejected the application. In
these circumstances. the present appeal by special leave has been filed by the
Sunderavaradhan, learned Senior Counsel appearing for the appellant took us
through the show cause notice issued by the second respondent to the first
respondent. the compromise order of the High Court passed on 22.5.1981 and also
two orders passed by the High Court in similar circumstances dated 25.5.1984 in
C.M. No. 164/82 and C.M. No. 363/82. It is the contention of Mr. R. Sunderavardhan
that the action of the first respondent Society expelling the appellant from
its membership was totally without jurisdiction and contrary to the bye-laws of
the Society and also the provisions of the Delhi Co- operative Societies Act
and Rules framed thereunder. It is his submission that the Delhi High Court
itself has construed clause (iii) of the compromise order in C.M. No. 164/82 in
C.W.No. 661/80 to mean that notices issued to persons who were not in arrears
must be treated as mis- conceived. That being the position as
explained/interpreted by the High Court. the counsel, argued that the stand
taken by the appellant that the Society ought not to have sent the notice when
the admitted position was that he was not in arrears was right. Even assuming
that the appellant should have filed an affidavit in the form prescribed by the
Society and to be subscribed on a stamp paper. the appellant should have been
given time to file such affidavit. Instead the Society removed him from its
membership presumably to oblige some other person waiting in the list. He also
placed heavy reliance on the orders of the High Court passed in C.M. No. 164/82
and C.M. No. 363/82 and submitted similar opportunity ought to have been given
to the appellant by the High Court and the failure to do so was not legally
sustainable. He also invited our attention to an order dated 1.3.1989 passed by
this Court while granting special leave petition in the presence of counsel for
the Society directing the Society to keep one plot vacant which will be
allotted after the decision of this appeal and permitted plots to be allotted
to other eligible members of the Society. According to the learned counsel one
plot as per orders of this Court must be available as on date and in the event
of success of this appeal. that plot must be allotted to the appellant.
A.K. Ganguli, learned Senior Counsel appearing for the Society except
submitting that the notice was served on the father of the appellant and he
having failed to file the affidavit within the prescribed time. cannot now seek
the relief of allotment of the plot. has no effective answer to the argument
that on the admitted position that the appellant was not in arrears of any kind
on the date when the notice was issued, the issuance of notice itself was not
right. Mr. Ganguli father submitted that subject to the result of this appeal,
the plot reserved as per the orders of this Court has been allotted to the
person in the waiting list and in case, the appellant succeeds that plot will
have to be allotted to the appellant.
have gone through the relevant materials placed before us and after considering
the rival arguments, we are of the view that the appellant has made out a case.
pointed out by the learned Senior Counsel for the appellant, the High Court
itself had occasion to decide an issue similar to the one under consideration
in C.M. Nos. 164/82 and 363/82. The High Court observed therein that 'we are
satisfied that the applicant had paid a sum Rs. 15,508/- before the date of
that notice and this is now accepted by counsel for the Society. It is also
accepted by the Society that the amount to be paid for a plot measuring was Rs.
15,500/-. It is, thus obvious that the applicant/appellant was not in default
and hence the notice sent to him was misconceived. the appellant/appellant is,
therefore, entitled to a plot. (Emphasis supplied) After observing as above. the
High Court directed the Society to allot a plot to the applicant/appellant in
that case and permitted the applicant/appellant to file an affidavit within one
month from the date of the order.
order was also passed in C.M. No. 368/82. When the matter under appeal came up
before the High Court a different view was taken presumably overlooking the
relevant fact that the appellant was also not a defaulter and. therefore, the
Society ought not to have sent a notice as contemplated under clause (iii) of
the compromise order. We are also told and it is not disputed that on the date
when the High Court dismissed the application of the appellant allotments were
not complete and there was no good ground to deny the appellant from producing
an affidavit in any event in the form required by the Society.
circumstances, we are of the view that the denial of the relief to the
appellant by the High Court cannot be sustained and the appellant must be
allotted a plot and if the required affidavit has not already been filed by the
appellant. the same will be filed within one month from the date of this order.
result. the appeal is allowed and the order of the High Court is set aside and
the prayer of the appellant in C.M.P. No. 881/83 to the extent indicated above
is filed by the individual who was in the waiting list and who has been
allotted the plot kept under reserve subject to the result of the appeal. As
already stated, the allotment to the applicant in I.A.No. 1/89 must be subject
to the result of this appeal. As the appeal is now allowed, the application for
intervention is dismissed.
will not, however, prejudice his any other rights against the Society.
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