Housing Buldg. Socty. Ltd. Vs. Registrar Coop.Societies & ANR.  INSC
290 (12 February 2009)
IN THE SUPREME COURT
OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 957 OF 2009 (Arising out
of SLP (C) No. 9866 of 2007) Hindustan Coop. Housing Building ..Appellant
Co-operative Societies and Anr. ..Respondents
Dr. ARIJIT PASAYAT,
in this appeal is to the judgment of Delhi High Court in Writ Petition
No.686/1992 and Review Petition No.268/2006 in the aforesaid writ petition.
facts in a nutshell are as follows:
On 5.9.1962 Anoop
Singh who as a member wrote to appellant-Society asking for refund of monies
(Rs.3110/- towards membership and Rs.15,000/- each for plot in appellant's
colony). The reason stated was that as the membership process with appellant
was getting delayed and he has purchased a plot in Green Park and as per Govt.
Policy there are no chances of getting more than one plot in Delhi.
On 9.5.1972 late
Anoop Singh filed application for transfer of his membership in favor of his
daughter, the respondent no.2.
On 18.11.1973, by a
letter the appellant-society informed Anoop Singh that the Managing Committee
by resolution dated 05.09.1973 allowed the transfer and asked for share
certificate and other documents to enable transfer.
appellant-society requested Anoop Singh to file an affidavit which was
questioned by respondent no.2 by letter dated 27.10.1978.
On 26.3.1979 Anoop
Singh did not file the requisite affidavit and Administrator of
appellant-society by letter informed that the transfer could not be confirmed
unless affidavit is filed.
On 14.4.1979 Anoop
Singh replied stating that it is not possible to file the affidavit as he does
not know full or part of lease hold or freehold of the property.
Administrator informed Anoop Singh of his inability to transfer the membership
as the affidavit was not filed and asked to withdraw the deposit from society
to which Anoop Singh requested for reconsideration vide letter dated
appellant's administration made it clear that no allotment could be made in
favour of respondent no.2 to which Anoop Singh again requested for
reconsideration vide letter dated 11.11.1979.
appellant-administration informed Anoop Singh that even though clause 5(2) of
Lease Deed provides for transfer without affidavit - allotment of plot could
not be possible unless original member establishes his own eligibility for
allotment for plot. However, opportunity of personal hearing was granted to
Administrator of appellant-society removed the name of Anoop Singh
categorically stating that it could not be transferred in favor of respondent
Secretary of the society also by its letter informed Anoop Singh that transfer
could only happen after submission of indemnity bonds and affidavits so it is
suggested that respondent no.2 be made fresh member of society w.e.f. date of
On 1.02.1982 Anoop
Singh tendered his resignation.
respondent no.2 filed WP(C) being 686/92 without challenging the orders of the
Administrator dated 26.03.1979, 29.05.1979, 11.07.1979 and 24.11.1979, seeking
writ of Mandamus asking appellant and respondent no.1 for allotment of plot or
in alternative to refund money paid by respondent no.2.
On 30.10.1995 Rule
was issued. On 19.09.2005 ex-parte proceedings qua appellant-society were
initiated in High Court.
On 16.02.2006 the
High Court allowed writ petition and issued directions to respondent no.1 to
recommend the case to appellant-society for allotment of plot in category `C'
of 125 sq. yards.
appellant-society came to know about the above order vide letter dated t.
22.05.2006 issued by respondent no.1.
appellant society then filed a Review Petition being 268 of 2006 and on
1.9.2006 the High Court issued notice. On 19.1.2007 the High Court dismissed
The High Court by the
order in writ petition held that the transfer in favour of Jasjit Kaur has been
accepted by the Society and therefore she was entitled to allotment of the
plot. It was held that the Registrar, Cooperative Society had no authority in
law to sit over the affidavit and not to recommend the case for allotment to
Jasjit Kaur. A direction was therefore given to the Registrar, Cooperative
Societies to forthwith recommend the case of Jasjit Kaur for allotment of plot
in Category `C' of 125 sq. yards. A Review Petition was filed inter-alia taking
the stand that after Mr. Anoop Singh had asked for refund of money, and
therefore, raising the question of any transfer in law did not arise. The
review petition was rejected on the ground that no case for review was made
K.T.S. Tulsi, learned counsel for the appellant submitted that the High Court
has clearly lost sight of various provisions, more particularly, Rule 25 of the
Delhi Co-operative Societies Rule, 1973 (in short the `Rules') framed under
Delhi Co-operative Societies Act, 1972 (in short the `Act'). It was pointed out
that without availing the statutory remedies available under the Act and the
Rules, the respondent No.2 Jasjit Kaur filed a writ petition. Since disputed
questions were involved, the High Court ought not to have interfered in the
matter. According to him directions given are clearly contrary to law.
response, learned counsel for respondent No.2 submitted that she has been
fighting a battle for getting her legitimate right and after having accepted the
prayer for transfer, the Society cannot turn around and take a stand that since
Anoop Singh was disqualified, the order of the High Court is indefensible. In
any event it is submitted that plot has been allotted pursuant to the High
Court's order and, therefore, by passage of time the petition has become
find that before the High Court there was no appearance on behalf of the
25 of the Rules reads as follows:
Disqualification of Membership:
No person shall be
eligible for admission as a member of a co- operative society if he- (a) has
applied to be adjudicated an insolvent or is an undischarged insolvent; or (b)
has been sentenced for any offence other than an offence of a political
character or an offence not involving moral turpitude and dishonesty and a
period of five years has not elapsed from the date of expiry of the sentence:
(c) in the case of
membership of a housing society:
(i) owns a
residential house or a plot of land for the construction of a residential house
in any of the approved or un-approved colonies or other localities in the
National Capital Territory of Delhi, in his own name or in the name of his
spouse or any of his dependent children, on lease hold or free-hold basis or on
power of attorney or on agreement for sale;
disqualification of membership as laid down in sub-rule (l)(c)(i) shall not be
applicable in case of co-sharers of property whose share is less than 66.72 sq.
metres of land;
Provided further that
the said disqualification shall not be applicable in case of a person who has
acquired property on power of attorney or through agreement for sale and on
conversion of the property from leasehold to freehold on execution of
conveyance deed for it, if such person applies for the membership of the
housing society concerned; (Amended on 6.8.97) (ii) he deals in purchase or
sale of immovable properties either as principal or as agent in the national
Capital Territory of Delhi: or (iii) he or his spouse or any of his dependant
children is a member of any other housing society except otherwise permitted by
anything contained in the rules or the bye-laws of the co-operative society, if
a member becomes, or has already become, subject to any disqualification
specified in sub-rule (1), he shall be deemed to have ceased to be a member
from the date when the disqualifications were incurred.
3. A member who
ceases to be a member of a co-operative society under sub-rule (2) shall not be
entitled to exercise rights of memberships or incur liability as member with
effect from the date referred to in sub-rule (2) but as from the date he
becomes a creditor of the co-operative society in respect of the amount due to
him on account of paid up share capital, deposit, cost of land deposited or any
other amount paid by him to the co operative society as its member. As from the
date of his ceasing to be a member or the society under sub-rule (2), the amount
standing to his credit shall be paid to him by the co-operative society within
3 months and when the co-operative society is already under liquidation, the
amount due to him will be credited as a debt due to a third party from the
4. If any question as
to whether a member has incurred any of the disqualification referred to in
sub-rule (1) arises, it shall be referred to the Registrar for decision. His
decision shall be final and binding on all concerned. The power of the Registrar
under this rule shall not be delegated to any other person appointed to assist
the purpose of the present case Sub-rule (2) of Rule 25 is of paramount
importance. There is a deemed disqualification. The effect of it has not been
examined by the High Court.
is, as noted above, a deeming provision. Such a provision creates a legal
fiction. As was stated by James, L.J. in Levy, Re, ex p Walton (1881 (17) Ch.D
746) "when a statute enacts that something shall be deemed to have been
done, which in fact and in truth was not done, the court is entitled and bound
to ascertain for what purposes and between what persons the statutory fiction
is to be resorted to. After ascertaining the purpose full effect must be given
to the statutory fiction and it should be carried to its logical conclusion and
to that end it would be proper and even necessary to assume all those facts on
which alone the fiction can operate."
(See Hill v. East and
West India Dock Co. 1884 (9) AC 448, State of Travancore Cochin v. Shanmugha
Vilas Cashewnut Factory (AIR 1953 SC 333), American Home Products Corpn. v. Mac
9 Laboratories (P) Ltd 1986 (1) SCC 465 and Parayankandiyal Eravath Kanapravan
Kalliani Amma v. K. Devi (1996 (4) SCC 76).
In an oft-quoted
passage, Lord Asquith stated: (All ER p. 599 B-D) "If you are bidden to
treat an imaginary state of affairs as real you must surely, unless prohibited
from doing so, also imagine as real the consequence and incidents which, if the
putative state of affairs had, in fact, existed must inevitably have flowed
from or accompanied it. ...
The statute states
that you must imagine a certain state of affairs, it does not say that having
done so, you must cause or permit your imagination to boggle when it comes to
the inevitable corollaries of that state of affairs".
(See East End
Dwellings Co. Ltd. v. Finsbury Borough Council 1951 (2) All ER 587 (HL)) 10.
"The word `deemed' is used a great deal in modern legislation.
Sometimes it is used
to impose for the purposes of a statute an artificial construction of a word or
phrase that would not otherwise prevail. Sometimes it is used to put beyond
doubt a particular construction that might otherwise be uncertain. Sometimes it
is used to give a comprehensive description that includes what is obvious, what
is uncertain and what is, in the ordinary sense, impossible."
Lord Radcliffe in St. Aubyn (L.M.) v. Attorney-General (No. 2) 1951 (2) All ER
473 , All ER p.498 F-G.]
as used in statutory definitions is meant "to extend the denotation of the
defined term to things it would not in ordinary parlance denote, is often a
convenient devise for reducing the verbiage of an enactment, but that does not
mean that wherever it is used it has that effect; to deem means simply to judge
or reach a conclusion about something, and the words `deem' and `deemed' when
used in a statute thus simply state the effect or meaning which some matter or
thing has - the way in which it is to be adjudged; this need not import
artificiality or fiction; it may simply be the statement of an undisputable
conclusion." (Per Windener, J. in Hunter Douglas Australia Pty. v. Perma
Blinds 1970 (44) Aust LJ 257.)
a thing is to be "deemed" something else, it is to be treated as that
something else with the attendant consequences, but it is not that something
else (per Cave, J., R. v. Norfolk County Court 1891 (60) LJ QB 379).
"When a statute
gives a definition and then adds that certain things shall be `deemed' to be
covered by the definition, it matters not whether without that addition the
definition would have covered them or not."
(Per Lord President
Cooper in Ferguson v. McMillan 1954 SLT 109)
the word "deemed" when used in a statute established a conclusive or
a rebuttable presumption depended upon the context (see St. Leon Village
Consolidated School Distt. v. Ronceray 1960 (23) DLR (2d) 32)).
"I ... regard
its primary function as to bring in something which would otherwise be
(Per Viscount Simonds
in Barclays Bank v. IRC 1961 AC 509 (HL).
means "is of opinion" or "considers" or "decides"
and there is no implication of steps to be taken before the opinion is formed
or the decision is taken.
[See R v. Brixton
Prison (Governor), ex p Soblen 1962 (3) All ER 641, All ER p.669 C.]
counsel for the appellant is right that normally when a statutory remedy is
available, the same should be availed. In the instant case that aspect has also
not been examined by the High Court. We are therefore of the considered opinion
that the writ petition needs to be heard by the High Court afresh to be decided
keeping in view the applicable legal provision. Since no counter affidavit had
been filed by the present appellant before the High Court we permit it to do so
within a period of one month. If any rejoinder is to be filed the same shall be
filed within a period of two weeks from the date of filing of the counter
affidavit. We request the High Court to explore the possibility of disposing of
the writ petition within a period of four months by fixing a definite date
after a period of six weeks from today. Till the disposal of the writ petition
by the High Court afresh, no third party rights in respect of the plot which is
stated to have been allotted to respondent No.2 shall be created by the
appeal is allowed to the aforesaid extent with no order as to costs.
(Dr. ARIJIT PASAYAT)