Mahim Causeway Macchimar ... vs Vasant Rambhau Tare And Ors.
2004 Latest Caselaw 994 Bom

JUDGMENT

S.U. Kamdar, J.

1. In the present Letters Patent Appeal, the appellant is challenging the order passed by the learned Single Judge rejecting the writ petition preferred by the appellant against the order passed by the authorities under the Maharashtra Co-operative Societies Act, 1960. Some of the brief facts in the present case are as under :-

2. The appellant is a co-operative housing society registered under the provisions of the Maharashtra Co-operative Societies Act, 1960 (hereinafter referred to as the said Act). The said housing society was allotted a plot of land by the Government of Maharashtra in the year 1965 admeasuring about 4,548 square yards at Mahini. The members of the said society of the appellant consist of Koli community. The said plot of land was allotted by treating the said Kolis as dishoused persons. The said society is essentially formed for the purpose of providing for housing to the fishermen of the said area.

3. An association of members or a proposed co-operative housing society was formed for an allotment of the accommodation to its members in a building to be constructed on the said plot of land allotted by the State of Maharashtra. There were around 120 members of the proposed society at that point of time. On 10-8-1985, a resolution was circulated amongst the members of the society calling upon them to make payment of sum of Rs. 10,000/- within a period of thirty days. The said amount was supposed to have been collected for registration and formation of the society as well as cost of construction. Immediately thereafter, the proposed society applied for registration to the Assistant Registrar and ultimately the said society was registered on 16-6-1987 with 120 members. During the pendency of the registration application before the Registrar, Co-operative Societies, a resolution was passed by the proposed Society inter alia deleting the names of nine members from the membership of the society which included the respondents Nos. 1 to 5 in the present appeal. In the list of members which was filed at the time of registration of the society, the names of these nine persons who were original members were deleted of which respondents Nos. 1 to 5 are five of the members. It is the case of the respondents before the authorities that in spite of making payments of share capital as far back as in 1967 and also contributing towards part of the construction cost coming to their share in 1975 still the names of the respondents were deleted. Consequently respondents Nos. 1 to 5 became ineligible for allotment of houses in their favour. The resolution dated 22-12-1985 by which the said nine members have been disqualified from becoming member's was never communicated to the respondents for a long time and it was communicated only after registration of the said society. Thus, five of the respondents filed an application under Section 23 of the said Act challenging their deletion from the List of Members of the said society. On 27-10-1989, the Assistant Registrar passed an order directing that the said nine members should be admitted back as members of the said society. The appellants herein preferred a revision application against the said order of the Assistant Registrar before the Divisional Joint Registrar. The said revision application No. 2 of 1990 also came to be dismissed by an order dt. 31-3-1992. The appellants being still dissatisfied with the decision of the authorities preferred a further revision before the Hon'ble Minister. The Hon'ble Minister has by an order dated 25-4-1997, dismissed the said appeal preferred by the appellants in respect of the said nine members. During the pendency of the said revision application, the Hon'ble Minister had granted a stay of the operation of the order of the Division Joint Registrar which came to be challenged by filing a writ petition and by an order dated 25-4-1995, the learned Single Judge of this Court vacated the said stay granted by the Minister. However, the Court further directed that in respect of the said premises which are claimed by the respondents herein, there shall not be an allotment to any party, whatsoever.

4. Against the order of the Minister in revision, the petitioner filed a writ petition in this Court being Writ Petition No. 4176 of 1998. By an order and judgment of the learned Single Judge dated 1-10-1999, the said writ petition has been dismissed. Being aggrieved by the said order of the learned Single Judge, the present Letters Patent Appeal has been preferred to this Court.

5. The learned counsel appearing for the appellant has strenuously argued before us that the respondents Nos. 1 to 5 are not entitled to become members of the appellant society and the order directing them to enrol as members is totally without jurisdiction and is liable to be set aside. In support of the said argument, the learned counsel has urged that provisions of Section 23 have no application in the facts and circumstances of the present case because at the relevant time when the decision was taken to remove the name of respondents Nos. 1 to 5 from fist of members of the society, the society was yet not registered and it was merely a proposed society. It has been urged by Mr. Cama, the learned Senior Counsel on behalf of the appellants, that for the purpose of acquiring jurisdiction by the Registrar under Section 23 of the said Act, it is necessary that as on the date of taking a decision to delete respondents Nos. 1 to 5 from the List of Members, a society should be a registered society and not a proposed society. It has been further urged by the learned Counsel for the appellant that the word "society" which is appearing in the provisions of Section 23 of the Act means a society which is duly incorporated and registered under the provisions of Section 9 of the said Act and unless the said society is registered, the provisions of Section 23 have no application.

6. In support of the aforesaid contention, Mr. Cama, the learned counsel for the appellant, has relied on the judgment, of the Supreme Court in the case of I. R. Hingorani v. Pravinchandra Kantilal Shah and Ors., . He also relied upon a judgment of the learned Single Judge of this Court in the case of Kapurchand Jivraj Jain since deceased by heirs Samtaben and Ors. v. Shri Datta Co-operative Housing Society Ltd., Amalner and Ors., reported in 1995 (1) Mh.L.J. 340. He further relied upon a Division Bench judgment in the case of President, Nagarpalika Prathamik Shala Shikshak Servants Co-operative Credit Society Ltd. v. Ramchandra Damodar Umalkar andors. reported in 1967 Mh.L.J. 473.

7. It has been alternatively, urged by the learned counsel for the appellant that even on merits, it is an admitted position that the respondents Nos. 1 to 5 having failed to make payment of the sum of Rs. 10,000/- in accordance with the resolution passed by the society, were not entitled to be enrolled as members of the said society, and consequently they were not entitled to allotment of the accommodation for their housing. It has been urged by the learned counsel for the appellants that after expulsion of respondents Nos. 1 to 5 as members of the said society, the appellants enrolled new members and thus the rights of new members would be affected if the impugned orders are upheld and the contention of the respondents Nos. 1 to 5 that they are wrongfully expelled from membership of the appellant society is considered and accepted. It was further urged by the learned senior counsel on behalf of the appellants that respondents Nos. 1 to 5 having failed to make payment, it is not equitable for this Court to permit them to enrol themselves as members of the society and consequently get the benefits of the housing accommodation in their favour.

8. The learned counsel for the respondents Nos. 1 to 5 has, on the other hand, urged that the legal contention of jurisdiction raised by the appellants cannot be raised in this Court for the first time. It was contended that this issue was never raised before the original authority or the first revisional authority or before the Hon'ble Minister in second revision. It was pointed out that even in writ petition, the said issue is not being raised but was raised for the first time in the course of arguments before the learned Single Judge and the learned Single Judge has refused to accept the same. The learned counsel for the respondents thus urged before us that this Court should not permit the appellant to raise an issue of jurisdiction for the first time in the proceedings before this Court since the same would be highly inequitable as against respondents Nos. 1 to 5. It was argued by the learned counsel for the respondents Nos. 1 to 5 that if at this stage such a contention is accepted then in that event the entire proceeding which has commenced from 1989 and contested upto 2004 will become nugatory and consequently relegate respondents Nos. 1 to 5 to file a suit for claiming their houses. It was thus contended that the appellants should not be permitted to urge the aforesaid issue at all in the present Letters Patent Appeal. Alternatively, it was argued that the authorities had an appropriate jurisdiction under Section 23 of the said Act and the order passed by the authority is legal and valid and requires no interference from this Court. On facts, the learned counsel for the respondents submitted that the findings of facts have been recorded by the three authorities which are concurrent findings of facts and this Court either in writ jurisdiction or in a Letters Patent jurisdiction arising therefrom should not disturb the same. The said findings of facts recorded by the authorities are summarized as under :-

i) That the resolution calling upon the respondents Nos. 1 to 5 to make payment of Rs. 10,000/- was arbitrary as it is not necessary or required to pay a sum of Rs. 10,000/- for the purpose of becoming a member of any society. What is required to be contributed is only the share capital and necessary application fees for the purpose of registration of membership.

ii) The finding of fact has been recorded that in any event, the respondents Nos. 1 to 5 have contributed towards cost of construction from time to time, though not entirely.

iii) Thirdly, the finding of fact is recorded by the authorities that the resolution calling upon persons to make payment of Rs. 10,000/- was not evenly applied to all the members as the delay was condoned in favour of many members who did not make payment within stipulated period of time and their payment was accepted. They were not removed or expelled from the membership of the society.

iv) Fourthly, the finding of fact recorded by the authorities is that the respondents Nos. 1 to 5 were never called upon to make payment of the balance amount within a particular period of time.

9. It was urged, therefore, by the learned counsel for respondents Nos. 1 to 5 that the aforesaid findings of facts requires no disturbance by this Court in Letters Patent Appeal and, therefore, the present Letters Patent Appeal should be dismissed.

10. Before dealing with the rival submissions of the parties, it is necessary to set out certain provisions of the Act which are necessary and relevant for considering the contentions which are raised before us.

11. The provisions of Section 2(16) i.e. a housing society reads as under:-

"2. Definitions :-In this Act, unless the context otherwise requires, - (16) "housing society means a society, the object of which is to provide its members with open plots for housing, dwelling houses or flats; or if open plots the dwelling houses or flats are already acquired, to provide its members common amenities and services."

The provisions of Section 2(19) defines a "member" and it reads as under :

(19)(a) "member" means a person joining in an application for the registration of a co-operative society which is subsequently registered, or a person duly admitted to membership of a society after registration and includes a nominal, associate or sympathizer member;"

The word 'society' is defined in Section 2(27) of the Act and it reads as under :-

"(27) "society" means a co-operative society registered, or deemed to be registered under this Act;"

The provisions of Section 23 of the said Act read as under :-

"23. Open membership.- (1) No society shall, without sufficient cause, refuse admission to membership to any person duly qualified therefor under the provisions of this Act and its bye-laws.

(1A) Where a society refused to accept the application from an eligible person for admission as a member, or the payment made by him in respect of membership, such person may tender an application in such form as may be prescribed together with payment in respect of membership, if any, to the Registrar, who shall forward the application and the amount, if any so paid, to the society concerned within thirty days from the date of receipt of such application and the amount; and thereupon if the society fails to communicate any decision to the applicant within sixty days from the date of receipt of such application and the amount by the society, the applicant shall be deemed to have become a member of such society. If any question arises whether a person has become a deemed member or otherwise, the same shall be decided by the Registrar after giving a reasonable opportunity of being heard to all the concerned parties.

(2) Any person aggrieved by the decision of a society, refusing him admission to its membership, may appeal to the Registrar. Every such appeal, as far as possible, be disposed of by the Registrar within a period of three months from the date of its receipt;

Provided that, where such appeal is not so disposed of within the said period of three months, the Registrar shall record the reasons for the delay.

(3) The decision of the Registrar in appeal, shall be final and the Registrar shall communicate his decision to the parties within fifteen days from the date thereof.

(4) Without prejudice to the foregoing provisions of this section, in the case of agro-processing societies or any other society for which a definite zone or an area of operation is allotted by the State Government or the Registrar, it shall be obligatory on the part of such society to admit, on an application made to it, every eligible person from that zone or the area of operation, as the case may be as a member of such society, unless such person is already registered as a member of any other such society, into the same zone or the area of operation."

12. Firstly, we are not inclined to consider the argument advanced by the learned counsel for the appellant pertaining to the jurisdiction of the Deputy Registrar to entertain the application on behalf of respondents Nos. 1 to 5 under Section 23 of the said Act. It is because the said issue was never raised by the appellant before all the three authorities i.e. Assistant Registrar, Divisional Registrar and the Hon'ble Minister, nor has the said issue been raised in the writ petition. It was argued before the learned Single Judge for the first time i.e. in 1999 whereas the proceedings have commenced as far back as 1987. It is after a period of 17 years of litigation having been prosecuted on the assumption that the application is properly made under Section 23 of the said Act, it will be highly inequitable to permit the appellant to raise the issue for the first time before the learned Single Judge and permit further the appellant to agitate the said issue before us. A finding from this Court that such an application is not maintainable under Section 23 of the said Act would consequently mean that the orders passed by the authorities being without jurisdiction would have to be set aside relegating the respondents Nos. 1 to 5 to initiate a civil proceeding as and by way of a civil suit and re-agitate the said issue from the lowest Court once again. We are not inclined to entertain the said objection of the appellant to the jurisdiction of the authorities in the light of the consequences which would necessarily result in upholding the said objection. We are of the view that such inequitable view ought not to be taken in the present case and the appellants be permitted to raise the issue for the first time in this Court after having agitated the issue on merits before the authorities.

13. Apart from the aforesaid, even on merits we are not inclined to accept the argument of the learned counsel for the appellant, as according to us on a true and correct interpretation of the provisions of Section 23 in the setting of the other provisions of the said Act, the argument is untenable and deserves to be rejected.

14. The arguments advanced by Mr. Cama, the learned counsel for the appellant, requires interpretation of the provisions of Section 23 of the said Act. Before we interpret the said section, we would like to revisit two basic principles of interpretation. Firstly that the interpretation of the section has to be in the context of and setting of other relevant provisions of the Act and the same has to be construed harmoniously with each other and not in isolation. Secondly that the provisions cannot be so interpreted that it can lead to absurd and arbitrary results or consequences thereof. These two principles of interpretation are now well settled and these are merely required to be restated.

15. In Maxwell on Interpretation of Statutes, 10th Edn. it is stated as under :-

"......if the choice is between two interpretations, the narrower of which would fail to achieve the manifest purpose of the legislation, we should avoid a construction which would reduce the legislation to futility and should rather accept the bolder construction based on the view that Parliament would legislate only for the purpose of bringing about an effective result."

16. The Supreme Court in the case of Mohan Kumar Singhania and Ors. v. Union of India and Ors., while dealing with various supreme Court judgments on different aspects of interpretation has following the case of Maharashtra State Board of Secondary and Higher Secondary Education v. Paritosh Bhupesh Kurmarsheth, in which it has been held as under :-

"....well established doctrine of interpretation is "that the provisos contained in a statutory enactment or in rules/regulations framed thereunder have to be so construed as to be in harmony with each other..."

17. Ultimately, after considering the judgments, the Supreme Court has further held as under :-

"However, it is suffice to say that while interpreting a statute the consideration of inconvenience and hardships should be avoided and that when the language is clear and explicit and the words used are plain and unambiguous, we are bound to construe them in their ordinary sense with reference to other clauses of the Act or Rules as the case may be, so far as possible, to make a consistent enactment of the whole statute or series of Statutes/Rules/Regulations relating to the subject matter. Added to this, in construing a statute, the Court has to ascertain the intention of the law making authority in the backdrop of the dominant purpose and the underlying intendment of the said statute and that every statute is to be interpreted without any violence to its language and applied as far as its explicit language admits consistent with the established rule of interpretation."

18. In another judgment in the case of Directorate of Enforcement v. Deepak Mahajan and Anr. , the Supreme Court has held as under :-

"True, normally Courts should be slow to pronounce the legislature to have been mistaken in its constantly manifested opinion upon a matter resting wholly within its Will and take its plain ordinary grammatical meaning of the words of the enactment as affording the best guide, but to winch up the legislative intent, it is permissible for Courts to take into account of the ostensible purpose and object and the real legislative intent.

"Authorising, a few of which we have referred to above, show that in given circumstances, it is permissible for Courts to have functional approaches and look into the legislative intention and sometimes may be even necessary to go behind the words and enactment and take other factors into consideration to give effect to the legislative intention and to the purpose and spirit of the enactment so that no absurdity or practical inconvenience may result and the legislative exercise and its scope and object may not become futile."

19. Now, looking at Section 23 of the said Act in the light of these two basic principles, we arc of the opinion that the argument advanced by the learned counsel cannot be accepted. The provisions of Section 23 have to be read together with Section 2(19) where the word "member" has been defined. The member has been so defined under the provisions of the Act so as to include even the person who is joining a proposed housing society for the purpose of its formation and registration. In light of the said definition, it is obvious that there can also be a refusal to make a person a member even at the pre-registration stage of the co- operative society. Secondly, the provision of Section 23 is a remedial section. It provides for an establishment of the speedy remedy in the event of refusal of a membership of the society or expulsion therefrom. When it contemplates an application under Section 23 in case of a refusal of a membership, obviously, it also takes into account the provision of Section 2(19) so as to take into its sweep the persons whose application for membership is rejected for the purpose of joining the proposal at a formation stage of the society. Thus, the argument of the learned counsel for the appellant that only in the case where a society is registered and the refusal or expulsion of membership is at the stage subsequent to the formation and registration of the society, obviously cannot be accepted. Secondly, if the said argument is accepted, it would result in absurd and arbitrary consequences between two persons who are similarly situated, one who applies to be a member of the society at the stage where it is at a pre-formation stage or the pre-registration in the form of a proposed society and where a person applies to be a member after the society is formed and/or registered. A remedy will be denied for one category under Section 23 but for second category remedial provisions will be available under the statute. In our view, such an absurd result cannot be accepted particularly when the provisions of Section 2(19) include both the categories of persons as a member i.e. when he applies at the stage of proposed society and joins in the formation thereof or applies to be a member at a stage subsequent to registration of the society. Both the persons are applying for membership of the same society so they cannot be discriminated or arbitrarily distinguished for the purpose of Section 23 of the said Act. In our view, such an absurd result ought to be avoided while interpreting Section 23 of the said Act. It is in light of the said principle of interpretation, we are of the view that the contention raised by the learned counsel for the appellant deserves to be rejected and has no merit. But before rejecting the said contention, we would also like to mention that the word "society" referred to in Section 23 of the said Act means a society as defined under Section 2(27) of the said Act which defines the society as one which is registered and/or an incorporated society under the provisions of the said Act. It is true that the definition of the word 'society' under Section 2(27) means a registered and/or an incorporated society. However, that does not mean that a person who applies for membership at the stage of its proposal and/or formation thereof is not entitled to the remedy under Section 23. The true and correct interpretation of Section 23 read with Section 2(19) and 2(27), in our opinion, would be that every member is entitled to the remedy under Section 23 even if his refusal of membership is at the formation stage and/or at the stage of proposed society. However, in view of the fact that the provisions of Section 2(27) provides for a definition of the society as duly registered and incorporated society, in our opinion that only means that the application under Section 23 when made to the Registrar, for the purpose of remedy, at that stage a society should be registered and/or incorporated society and not at the proposal or formation stage yet. If the aforesaid interpretation is taken into account in the light of provisions of Sections 2(19), 2(27) and 23 of the said Act, in our view, it would be a harmonious construction of the aforesaid provisions and would avoid absurd or discriminatory consequences which will otherwise follow if the argument of the learned counsel for the appellant is accepted. Thus, we hold that the Registrar had jurisdiction under Section 23 of the said Act to entertain the application of the Respondent Nos. 1 to 5.

20. Even otherwise, in our opinion, therefore, the argument of the learned counsel for the appellant at such a belated stage and grant or acceptance thereof would tantamount to inflicting injustice on respondents Nos. 1 to 5, and therefore the same deserves to be rejected and accordingly, we reject the same.

21. Reliance placed by the learned counsel for the appellant on I. R. Hingorani v. Pravinchandra Kant Hal Shah and Ors. (supra) and Kapurchand Jivraj Jain since deceased by heirs Samtaben and Ors., v. Shri Datta Co-operative Housing Society Ltd., Amalner and Ors., in our view has no relevance whatsoever to the facts of the present case. Firstly, in the aforesaid judgments what was considered was provisions of Section 91 of the said Act. The provisions of Section 91 deal with those disputes which are required to be resolved by a co-operative Court under Section 91 of the said Act. The provisions of Section 91 of the said Act contemplates as a condition precedent a kind of dispute to be resolved between various categories of people, namely, member and member, member and the society, member or a past member, member or a person claiming through a member. Thus, the provisions of Section 91 contemplates a condition precedent to the existence of a dispute of a type and character prescribed thereunder. The provisions of Section 91 therefore can apply only if there is an existence of a dispute of a kind of the category which is stipulated therein. In the light of the provisions of the said section, it was held by the Apex Court as well as the learned Single Judge of this Court that unless at the time of cause of action i.e. if at the time of occurring of the dispute it is not between the categories of the persons so specified under Section 91 of the Act then the Co-operative Court shall have no jurisdiction. In our opinion, such condition precedent does not exist under the provisions of Section 23 of the said Act. The provisions of Section 23 merely provide a remedial section for expulsion or refusal of a membership of the society. Therefore, a person who seeks to join a proposed co-operative housing society at its formation stage is treated as a member, under Section 2(19) and refusal of such an application would also fall under Section 23 of the said Act providing remedy to approach the Registrar for redressal of his grievance.

22. The next judgment relied upon by the learned counsel for the appellant in the case of President, Nagarpalica Prathamik Shala Shikshak Servants Co-operative Credit Society Ltd. v. Ramchandra Damodar Umalkar and Ors. has totally no application for the simple reason that though the same arises under Section 23 of the Act, the issue before the Court was whether the Registrar under the provisions of Section 23 can interfere before the society has taken final decision of expulsion of a member. The Court has held in the aforesaid judgment that the Registrar does not acquire jurisdiction till and until final decision is taken on the membership of a person by the society and only the final decision which can be the subject-matter of challenge under Section 23 of the said Act. In the present case, it is nobody's case that final decision has not been taken by the Society. In the aforesaid circumstances, we do not see any comparison to the facts of the present case with the Judgment of the Division Bench cited above. We, therefore, are of the view that the said judgment has no application to the facts and circumstances of the present case. In the aforesaid view, we do not find any substance even on merits in the argument pertaining to the jurisdiction of the Registrar under Section 23 of the said Act.

23. On merits, there is a concurrent finding of facts by all the authorities below. It is not disputed that the respondents Nos. 1 to 5 applied for membership and made payments as required to be made by a member of the society. Even there is no dispute that part of the amount towards cost of contribution has been paid. Furthermore, the finding of fact has been given by the authorities below that there are various members who did not make payment for construction cost and in their cases, the regularisation has been granted whereas in the case of respondents Nos. 1 to 5 regularisation has been refused. Apart from the aforesaid fact, the new members who are seeking to get the benefit of accommodation in place of respondents Nos. 1 to 5 are admittedly enrolled subsequent to the expulsion of respondents Nos. 1 to 5 as the members of the society and thus they cannot claim any equity or any better right to be members of the society in preference to that of respondents Nos. 1 to 5. We are of the view that respondents Nos. 1 to 5 have in fact made payment of the construction cost though not complete and there was no justification for their refusal as members of the society. In view of the aforesaid facts, we are not inclined to exercise our jurisdiction under Letters Patent to interfere with the said concurrent findings of facts of all the three authorities and which has been upheld by the learned Single Judge in the writ petition.

24. During the pendency of the writ petition before the learned Single Judge, by an order dated 20-3-1998 an interim order came to be passed in Civil Application No. 5065 of 1997. Under the said interim order the appellant co- operative society is directed to keep the eight flats locked and not to allot them to any member during the pendency of the petition. In the said order, the learned Single Judge has given the flat numbers which are to be kept locked and not to be allotted. The relevant portion of the order dated 20-3-1998 reads as under:-

"The Co-operative Housing Society is directed to keep the following 8 flats locked and not to allot them into any member during the pendency of these petitions. The flats are -

1. Flat No. 501, A Wing, 5th floor,

2. Flat No. 092, B Wing Ground floor,

3. Flat No. 303, B Wing, Third floor,

4. Flat No. 601, B Wing, First floor,

5. Flat No. 701, B Wing, Seventh floor,

6. Flat No. 704, B Wing, Seventh floor,

7. Flat No. 103, D Wing, First floor, and

8. Flat No. 302, D Wing, Third floor."

The petition has been ultimately dismissed and the present appeal has been preferred by the appellant against the final order of the learned Single Judge. In the present appeal also by an interim order dated 12-12-2000, the said order dated 20-3-1998 passed in writ petition and referred to hereinabove has been continued and directions arc given by the Division Bench that the flats shall be continued to be kept vacant till the disposal of this appeal. The relevant portion of the direction contained in order dated 12-12-2000 reads as under :-

"4. If any flats have been kept vacant pursuant to the orders of this Court dated 20-3-1998, they shall be kept vacant till the disposal of this appeal."

25. In view of the dismissal of the present appeal, the said flats are required to be handed over to the said 8 persons for whom the said flats have been kept vacant. We accordingly direct the appellant to hand over the vacant possession of the said flats to the respective members entitled to the same within a period of 8 weeks from today.

26. Subject to the aforesaid directions, the present appeal stands dismissed. However, there shall be no order as to costs.