Narotam Prasad, Vice-President, ... vs Premalabai Chavan, President, ...
1999 Latest Caselaw 27 Del

JUDGMENT

K. Ramamoorthy, J.

1. This appeal is against the order dated 9.9.1996 of the learned Single Judge dismissing the applications filed by the appellants.

2. The appellants on the 11th of January, 1994 instituted the Suit No. 103/94 praying for the following reliefs:

"It is, therefore, humbly prayed that the Hon'ble Court may be pleased to pass a decree -

(1) declaring that the Memorandum of Association and constitution and by-laws of the Society as registered with the Registrar of Society on 11th May, 1956 are the governing Memorandum and Constitution of Society;

 (2)    declare that only the ordinary and life members of the Society have a right to vote and elect the executive committee;  
 

 (3)    declare that the Executive Committee shall consist of only elected members;  
 

 (4)    declare that the President has no power or authority to nominate member to the Executive Committee;  
 

 (5)    direct the defendants to allow inspection of the minute books, account books and other records in particular relating to Andhra Pradesh Lottery Scam;  
 

 (6)    direct that the disbursement of funds of the Society shall be under the joint signatures of the Treasurer and President;  
 

 (7)    direct the defendants that a meeting of the Executive Committee consisting of only elected members should be called forthwith, to manage the affairs of the Society;"   
 

 3. In IA. 370/94 filed in Suit No. 103/94, the appellants prayed for the following reliefs :  
  

  "It is, therefore, most respectfully prayed that this Hon'ble Court be pleased to:
 
   

 (i)     restrain the defendants No. 1 and 2 from operating any of the Bank accounts of the Society without the signature of the Treasurer;  
 

 (ii)    direct the defendant Nos. 1 and 2 to call a meeting of the elected members of the Executive Committee;   
 

(iii) direct the defendants No. 1 and 2 to allow inspection of minute books, proceeding register, books of account, vouchers, files etc. relating to Andhra Pradesh and Arunachal Pradesh letters to plaintiffs No. 1 &

2."

4. In IA. 328/94 filed in Suit No. 103/94, the applicant prayed for the following reliefs:

"It is, therefore, humbly prayed that the Hon'ble Court may be please to appoint a Receiver to take charge and manage the affairs, and the funds of the Society till such date as the Hon'ble Court may deem fit and proper in the circumstances of the case."

5. In IA. 7409/95 filed in Suit No. 103/94, the applicant prayed for the following reliefs :

"Under the circumstances mentioned above, it is most humbly prayed that this Hon'ble Court be pleased to:

 (a)    vacate the injunction order dated 13.1.1994 passed restraining the defendant No. 1 Society to operate the Bank accounts, in accordance with law;  
 

 (b)    as an ad interim relief, to direct the respondent No. 2 to place the amount of Rs. 12 lacs standing to the credit of the Society immediately in fixed deposit account, so as to earn a higher rate of interest for the Society;  
 

 (c)     the Hon'ble Court takes serious view of the mala fide action of respondents and especially plaintiff 2 / present respondent No. 1 to miscarry the course of justice.  
 

  (d)    grant cost of the application against the respondents who have forced the Society to file this application, which was otherwise unnecessary."   
 

 6. The learned Single Judge, after considering all the materials placed before him, dismissed the applications. The learned Single Judge observed :  
  

"Though the case of the plaintiffs is that they had not been served with any notice of expulsion or about the alleged termination of their membership from the Society, nor they are allegedly aware of any meeting held on January 2, 1994 to elect the office bearers of the Society, however, from the record, I find that on 6th December, 1993 the Society had submitted a list of its office bearers along with an up-to-date list of members of the Society. In the list of members which had been sent to the Registrar, the names of none of the plaintiffs appear. An intimation about the elections to the Executive Committee of the Society, held on January 2, 1994, was also sent to the Registrar of Societies. In the list of office bearers submitted to the Registrar on October 31, 1994, defendants 1 & 2 have been shown as the President and Secretary respectively whereas Malti Saxena and P.K. Nagar have been shown as the Vice President and the Treasurer of the Society respectively. Names of other members of the Executive Committee elected on 2nd January, 1994 have also been mentioned in the said list. Plaintiffs had been given notices to show cause as to why their membership be not terminated and from the record I find that a proper enquiry was held before a decision to terminate their membership was taken. Prima facie I am unable to agree with the plaintiffs that they were not aware about the termination of their membership. It was only after their membership was terminated that they were not allowed to participate in the affairs of the Society about which a complaint has been made in the present suit. I am, therefore, of the prima facie view that plaintiffs have suppressed material facts of their membership having been terminated and fresh elections having been held on 2nd January, 1994 from this Court.

In the fact of the said documents and taking into consideration other documents on record, prima facie, I am of the view that not only that plaintiffs were aware about the elections held on January 2, 1994 but they were also aware about the termination of their membership from the Society. As on the date of filing of the suit not only that the plaintiffs had ceased to be members of the Society but plaintiff No. 2 was also not its treasurer. The plaintiffs have neither challenged the termination of the membership nor the elections held on January 2, 1994 and, in my view, therefore, they are not entitled to challenge operation of bank account by the elected office bearers of the society."

7. The learned Single Judge had also referred to the fact that at the fag end of the arguments on the application for injunction the appellants filed an application for amendment of the plaint. The learned Single Judge held:

"In my view, the plaintiff had suppressed the material facts of the termination of their membership from the Society as also the holding of elections on 2nd January, 1994 from this Court and they have been able to obtain an ex-parte injunction by suppression of material facts from this Court. The ex-parte order of injunction is, therefore, liable to be vacated on this short ground. However, even on merits, I find that the defendants, being the elected office bearers of the Society, have every right to manage its affairs in accordance with the Memorandum of Association of the Society. The plaintiffs have no right to interfere in the functioning of the Society by the defendants. The elected office bearers cannot be prevented from exercising their rights to manage the affairs of the Society".

8. In the concluding para of the judgment, the learned Single Judge held:

"Though the plaintiffs have made applications about the defendants frittering away the fund s of the Society, however, on the basis of the material on record, I am unable to persuade myself to agree with the plaintiffs. Moreover, as I have already held that the plaintiffs have not come to the Court with clean hands and have suppressed material facts from this Court, they are not entitled to the discretionary relief of injunction or appointment of Receiver. Plaintiffs, not being members of the Society, cannot seek appointment of a Receiver. Defendants as elected office bearers of the Society have a right to manage its affairs and in case of any irregularity, general body of the Society can remove them. I do not agree with the plaintiffs that there is any danger of the property being dissipated by the defendants. In my view, it will not be just and convenient to appoint a Receiver".

9. Having gone through the pleadings and having heard arguments, we are satisfied that the learned Single Judge has correctly applied the law and has come to correct conclusions. There is no reason for us to differ from the view taken by the learned Single Judge. Accordingly, FAO(OS) 420/96 is dismissed.

10. There shall be no orders as to costs.