Rehabilitation Ministry ... vs Registrar Cooperative Societies ...
2009 Latest Caselaw 3374 Del

       THE HIGH COURT OF DELHI AT NEW DELHI

%                                 Judgment delivered on: 26.08.2009

+      W.P.(C) 5622/2007


REHABILITATION MINISTRY EMPLOYEES
COOPERATIVE HOUSE BUILDING SOCIETY LTD.                           ..... Petitioner

                        versus

REGISTRAR COOPERATIVE SOCIETIES & ANR                            ..... Respondent

Advocates who appeared in this case:-

For the Petitioner : Mr. Rakesh Munjal, Sr. Advocate with Ms. Aprajita Mukherjee, Advocate.

For the Respondent : Ms. Deepa Tiwari on behalf of Ms.Sujata Kashyap, Advocate for respondent no.

1-RCS.

Mr. Satyavir Singh, Inspector, O/o RCS.

Ms. Shawana for Ms. Monika Garg, Advocate for respondent no. 2-UOI.

CORAM:-

HON'BLE MR. JUSTICE BADAR DURREZ AHMED HON'BLE MS. JUSTICE VEENA BIRBAL

1. Whether reporters of local papers may be allowed to see the judgment?

2. To be referred to the Reporter or not?

3. Whether the judgment should be reported in the Digest?

BADAR DURREZ AHMED, J (oral)

1. This writ petition is directed against the order dated 13.07.2009

passed by the Registrar of Co-operative Societies, whereby the draw-of-lots

held on 28.04.2007 by the petitioner society in respect of four plots was

declared to be null and void. The writ petition is also directed against the

show-cause notice dated 13.07.2007 issued by the Registrar of Co-operative

Societies to the petitioner society in respect of the said draw-of-lots held on

28.04.2007. The Managing Committee of the petitioner society has been

asked to show cause as to why it should not be superseded for having

allegedly contravening the provisions of Section 77 of the Delhi Co-

operative Societies Act, 2003. The controversy in this writ petition centers

around the question as to who is to carry out the draw-of-lots? Whether it is

the society or the lessor?

2. As per the allotment letter dated 07/09.06.1982, it has been indicated

that after completion of development of the land to the satisfaction of the

Chief Settlement Commissioner, a perpetual lease would be granted to the

society in respect of the residential plots carved out of the land. It is also

stipulated that the society shall thereafter be required to make individual

allotment to its members, subject to the verification of the membership of

each member by the Registrar of Co-operative Societies. Thereafter, a

perpetual sub-lease would be issued to the individual member on receipt of

the allotment proposal accompanied by the verification report from the

Registrar of Co-operative Societies.

3. Subsequent to the said allotment letter, a perpetual lease was executed

by the President of India in favour of the petitioner society on 28.08.1989.

The lease was in respect of a piece of land measuring 216 Bighas and 8

Biswas or thereabouts, situated at Villages Sarai Sahji, Begumpur and Patti

Hameed Sarai, adjacent to Malviya Nagar Colony, New Delhi.

4. Clause II(5)(a) of the said perpetual lease indicated that the lessee,

that is, the petitioner had to sub-lease one residential plot to each of its

members as existing on 01.09.1980 and in accordance with the prevailing

bye-laws of the society and on such terms and conditions as the lessor, in his

absolute discretion, may direct. The membership of the persons in favour of

whom the sub-lease was to be executed would be approved by the Registrar

of Co-operative Societies and/or by the Chief Settlement Commissioner.

5. It appears that on 17.02.1984, the Registrar of Co-operative Societies

granted clearance of membership in respect of 146 members. At serial no.

144, the name of Mr. R.S. Mittal appears. He is one of the persons in

respect of whom the draw-of-lots was carried out on 28.04.2007. Thereafter,

the Registrar of Co-operative Societies granted clearance to a further 45

members by his letter dated 29.03.1984. At serial no. 45, the name of

Mr.Daryao Singh appears. On 01.12.1984, clearance was given to a further

48 members by the Registrar of Co-operative Societies. The name of Smt.

K.K. Sharma appears at serial no. 48. On 08.04.1994, transfer and clearance

in respect of the membership which was hitherto held by Mr.Puran Chand,

membership no. 469, in favour of his widow, Smt. Karuna Wati, was

approved by the Registrar of Co-operative Societies. Thus, in this manner

the Registrar of Co-operative Societies granted clearance to the membership

of Mr. R.S. Mittal, Mr. Daryao Singh, Smt. K.K. Sharma and Smt. Karuna

Wati. It appears that Smt. Karuna Wati and Mr. Daryao Singh have since

passed away. Their legal heirs will have to make representations before the

respondent no. 1, who would process the same in accordance with law.

Thus, insofar as the present writ petition is concerned, we are left to consider

the cases of Mr. R.S. Mittal and Smt. K.K. Sharma.

6. On 08.04.2007, the general body of the petitioner society decided to

conduct the draw-of-lots and allot the plots to the aforesaid four members.

On 17.04.2007, information with regard to the conduct of the draw-of-lots to

be held on 28.04.2007 was sent to the Registrar of Co-operative Societies

with the request to appoint an Observer for the same. The Registrar of Co-

operative Societies, however, did not respond to the same nor was any

Observer appointed. Consequently, the draw-of-lots was conducted by the

petitioner society on 28.04.2007 in the absence of the Observer. On

07.06.2007, the Registrar of Co-operative Societies, on receiving

information from the petitioner society with regard to the conduct of the

draw-of-lots, sent a show-cause notice to the petitioner society indicating

that the draw-of-lots was illegal inasmuch as it contravened the provisions of

Section 77 of the Delhi Co-operative Societies Act, 2003 wherein the draw-

of-lots was to be conducted by the lessor of the land. The petitioner society

furnished a reply dated 14.06.2007 to the said show-cause notice. However,

the Registrar of Co-operative Societies was not impressed by the reply and

passed an order dated 13.07.2007 declaring that the draw-of-lots was null

and void.

7. The order dated 13.07.2007 whereby the draw-of-lots was declared to

be null and void does not contain any reasons. On the same date, that is, on

13.07.2007, the Registrar of Co-operative Societies issued a show-cause

notice to the petitioner society requiring it to show cause as to why the

present Managing Committee should not be superceded and an administrator

should not be appointed in view of the fact that it had conducted the draw-

of-lots on 28.04.2007 on its own, in alleged violation of Section 77 of the

DCS Act, 2003.

8. It is at this stage that the petitioner approached this court by way of

this writ petition. On 03.08.2007, when this matter was taken up by this

court, it granted an interim order staying further action pursuant to the said

show-cause notice dated 13.07.2007. The matter has rested there.

9. The learned counsel for the petitioner submitted that in terms of the

letter of allotment and the perpetual lease, the petitioner society conducted

the draw-of-lots because it was under the impression that the draw-of-lots

was to be conducted by the society itself and not by the lessor. He also drew

our attention to the Government of India's letter dated 27.07.2007 which is

addressed to the Office of the Registrar of Co-operative Societies and

pertains to the draw-of-lots in alleged violation of Section 77 of the said Act.

In paragraph 2 of the said letter, the Government of India, through the

Deputy Land and Development Officer has made it clear that as per the

terms of allotment letter dated 09.06.1982, the society was required to make

individual allotment to its members, subject to verification of the

membership of each individual member by the Registrar of Co-operative

Societies. It further clarified that a perpetual sub-lease was to be issued to

the individual member on receipt of the allotment proposal accompanied by

the verification report from the Registrar of Co-operative Societies. It

specifically clarified that the terms of the allotment letter as well as the lease

deed do not provide that the draw-of-lots was to be conducted by the lessor.

The said letter also noted that in the past, there had been no objection from

the Office of the Registrar of Co-operative Societies on draw-of-lots in the

absence of the lessor. By virtue of the said letter dated 27.07.2007, the

Deputy Land and Development Officer, however, submitted that since it has

now been pointed out that the draw-of-lots was allegedly in violation of the

provisions of the Section 77 of the said Act, the Registrar of Co-operative

Societies may clarify whether the draw-of-lots is required to be conducted

by the lessor even though there is no such provision in the allotment letter or

in the lease deed and all previous draws were not conducted by the lessor.

10. A short affidavit dated 04.08.2009 has been filed by the Registrar of

Co-operative Societies. The short affidavit has been filed pursuant to this

court's order dated 29.01.2009, wherein the learned counsel for the Registrar

of Co-operative Societies had indicated that a decision would be taken with

regard to the confirmation concerning the employment status of the said four

members. This verification was necessary because it is only the employees

of the Rehabilitation Department who could become members and be

allotted plots in the petitioner society. As per the short affidavit by the

respondent no. 1, it is indicated that the membership of Sh. R.S. Mittal

(membership no. 603) and Smt. K.K. Sharma (membership no. 707) have

been cleared by the competent authority on draw-of-lots for allotment of

plots in the Rehabilitation Ministry Employees Cooperative House Building

Society Limited (the petitioner society). The short affidavit also indicates

that the other two members, namely, Smt. Karuna Wati and Sh. Daryao

Singh have expired and their legal heirs have claimed the membership but

they have not submitted the requisite documents. That process is underway.

11. In view of the foregoing circumstances, we are of the opinion that the

allotment letter and the lease did not provide for any condition that the draw-

of-lots was to be conducted by the lessor. However, Section 77 of the DCS

Act, 2003 which came into force only on 01.04.2005 does indicate that the

draw-of-lots is to be carried on by the lessor. There is, however, a question

as to whether this provision would apply or be overridden by the conditions

of the allotment letter when read with the lease in view of the provisions of

the Government Grants Act, 1895. We are not going into that issue

inasmuch as the petitioner as well as the respondent no. 1 would be satisfied

if the draw-of-lots is now conducted by the respondent no. 2 with respect to

the two members who stand cleared namely, Mr. R.S. Mittal and Smt.K.K.

Sharma.

12. Consequently, we dispose of this writ petition with the direction that a

fresh draw-of-lots in respect of the two members named above be carried out

by the respondent no. 2 within two weeks and after such draw-of-lots is

conducted, the sub-lease be executed in favour of the said members within

four weeks. Insofar as the show-cause notice dated 13.07.2007 is concerned,

we are of the view that the action taken by the petitioner society was bona

fide and probably in accordance with the specific terms and conditions of the

allotment letter and the perpetual lease. This would be apparent from the

fact that they had also informed the Registrar of Co-operative Societies prior

to the conduct of draw-of-lots on 24.08.2007. In this respect, we do not feel

it to be necessary to pursue the show-cause notice any further and to obviate

any such possibility, we quash the same.

The writ petition stands disposed of.

BADAR DURREZ AHMED, J

VEENA BIRBAL, J AUGUST 26, 2009 kks