Garhwal Cooperative Group ... vs Registrar Cooperative Societies ...
2009 Latest Caselaw 4056 Del

         THE HIGH COURT OF DELHI AT NEW DELHI


%                                      Judgment delivered on: 08.10.2009


+      W.P.(C) 2114/1990


GARHWAL COOPERATIVE GROUP HOUSING SOCIETY
LTD                                ..... Petitioner

                    - versus-


REGISTRAR COOPERATIVE SOCIETIES & ORS ...Respondent

Advocates who appeared in this case:

For the Petitioner :      Mr. N.K. Kantawala and Mr. Satyender, Advocates
For the Respondent :      None



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

1. Whether the 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 Digest?

BADAR DURREZ AHMED, J (ORAL)

1. We have heard the learned counsel for the petitioner. Nobody

appears on behalf of the respondents today. This is despite the fact that all

the respondents have been served, as indicated in the order dated

18.08.2009, whereby, in the presence of the counsel for the respondent Nos.

3 and 6, this Court had directed that this matter be listed in the category of

Regular Matters as per its own turn. In these circumstances, we have

thought it fit to hear the learned counsel for the petitioner and to decide this

matter on the basis of arguments advanced by him and the material already

on record. This is an old matter of 1990.

2. We may also note that in the first instance when this matter was

taken up by this Court on 09.07.1990, the same was dismissed in limine.

Being aggrieved by the said dismissal, the petitioner preferred a Special

Leave Petition before the Supreme Court being SLP (C) No.12153/1990

which was admitted and numbered as Civil Appeal No.5633/1990. The said

appeal was disposed of by the Supreme Court by an order dated 26.11.1990

whereby the order of dismissal in limine dated 09.07.1990 passed by this

Court was set aside and the case was remanded to this Court with a direction

that the petition be restored and the same be disposed of on merits and

according to law after giving parties an opportunity to file their affidavits.

Thereafter, parties have appeared and the pleadings have been completed.

3. The learned counsel for the petitioner submitted that the case is

one of no opportunity of hearing having been granted to the petitioner. He

submitted that the respondent No.4 was an allottee of a flat bearing No. B-44

in the petitioner Society. He submitted that sometime in 1985, a certificate

was issued by the Society for the purposes of computation of property tax

which indicated the cost of the flat to be Rs 86,000/-. The learned counsel

submitted that this figure of Rs 86,000/- excluded various other costs such as

cost of Community Centre, Development Charges, cost of Delhi Electricity

Supply Undertaking Sub-Station etc. As per the petitioner, the total sum

payable by the petitioner as on 31.12.1985 was Rs 1,02,900/-. The said

computation was arrived at in the following manner:-

      "1. Towards Dev. & Const.                     Rs 52900.00
      2. DCHFS loan given                          Rs 50000.00
                   (on 1.1.86)                     __________
                                            Total Rs 1,02,900.00    - Cost of flat+

       3.   Extra Cost of top floor                Rs 3000.00
       4.   DESU Sub Stn Cost                      Rs 7500.00
       5.   Cost of land                           Rs 4500.00
       6.   DCHFS Share money                      Rs 4355.00
       7.   Society Share money                    Rs 2100.00
       8.   Nine instalment paid by him            Rs 16880.00 (Principal Rs 837/- +
                                                                 Instt. Rs 16043/-)
       9. Defaulted Interest                       Rs 29406.00 (from 1.8.78 to 31.12.85
                                                                 Statement attached)
                                                   ___________
                                            Total Rs 1,70,641.00

       + NB      Cost of flat is Rs 1,02,900/- including cost of Community Hall,

Garage, Water Pump House etc. If these are excluded the cost of flat comes to be Rs.86000/-."

4. It is indicated by the petitioner that the cost of the flat was Rs

1,02,900/- which included the cost of Community Hall, Garage, Water Pump

House etc. and that, if these are excluded, the cost of the flat would come to

Rs 86,000/-. As per the petitioner, the certificate indicating the cost of the

flat to be Rs 86,000/- had been given only for the purposes of assessment of

House Tax and was not the entire extent of liability of the respondent No.4

towards the said flat. The respondent No.4 was also liable to pay the Society

for the cost of Community Centre Development Charges, share money of

Delhi Cooperative Housing Finance Ltd., the interest payable thereon, the

cost of the DESU Sub-Station, the extra cost of the top floor as well as the

interest equalization amount on the delayed payment.

5. The respondent No.3 claiming to be the power of attorney

holder of the respondent No.4 filed an application before the Joint Registrar

under Section 60 of the Delhi Cooperative Societies Act, 1972. The matter

was referred to arbitration by an order dated 06.11.1989. The first hearing

before the respondent No.2 Arbitrator was held on 18.12.1989. On

23.12.1989, the petitioner Society filed its written statement and the case

was adjourned to 06.01.1990 for filing of documents. On 06.01.1990,

nobody appeared on behalf of the petitioner Society before the Arbitrator

(respondent No.2). It is submitted before us that the Secretary of the

petitioner Society could not appear before the Arbitrator on that date on

account of certain unavoidable circumstances inasmuch as he was having

certain domestic problems with his wife. The Arbitrator, without giving any

further opportunity to the petitioner Society, concluded the hearing on

06.01.1990 itself and passed an award against the petitioner Society to the

extent of Rs 65,593/-. The award was based on the consideration that the

cost of the flat as per the certificate submitted was Rs 86,000/-. The

computation of Rs 65,593/- as awarded by the Arbitrator by virtue of the

award dated 06.01.1990 is as under:-

       "a)           Rs. 1,36,666/- paid upto Dec. 1989
        Less         Rs. 86,000/- cost of the flat
        Balance      Rs. 50,666/- Excess amount recovered by the Society.

        Add          Rs. 14,937/- Interest charged calculated.
        Total        Rs. 65,593/-"

6. Being aggrieved by the said award, the petitioner Society

preferred an appeal before the Delhi Cooperative Tribunal under Section 76

of the Delhi Cooperative Societies Act, 1972. In the said appeal, the

petitioner Society, inter alia, took the plea that both the parties had appeared

before the Arbitrator on 23.12.1989 and the Arbitrator/respondent No.2 had

directed the parties to produce the relevant papers/documents and in support

of their contentions and had adjourned the case to 06.01.1990. It was

submitted that on that date the petitioner could not appear due to some

unavoidable circumstances and that the Arbitrator instead of issuing another

notice to the petitioner giving a final opportunity, made the said award dated

06.01.1990. The learned counsel for the petitioner submitted that the date

of 06.01.1990 was fixed for filing of documents and not for arguments and

that, the Arbitrator, if he felt that the petitioner was adopting dilatory tactics,

could have closed the right of the petitioner to file documents and ought to

have listed the case for arguments on another date. According to the learned

counsel for the petitioner, that would have met the ends of justice, however,

instead of doing so, the learned Arbitrator decided the matter on 06.01.1990

itself, the date on which the parties were to file their documents.

7. The Delhi Cooperative Tribunal dismissed the appeal filed by

the petitioner on three points. The first point being that the appeal was

incomplete as the copy of the impugned award had not been filed along with

the appeal. The second point was that the appeal was delayed. The third

point on which the appeal was dismissed was that it could not be said that

the Arbitrator had failed to offer an opportunity to the petitioner and that it

was the petitioner Society alone who was to be blamed for the wilful

absence of its representative on the date fixed. The Tribunal was of the

view that, in these circumstances, the Arbitrator had no option but to pass

the award after going through the material/evidence available before him.

On the basis of these three points, the appeal was dismissed.

8. The learned counsel appearing on behalf of the petitioner

submitted that the copy of the impugned award could not be filed along with

the appeal as the same was not received till that time. The learned counsel

for the petitioner submitted that even before the Tribunal, the petitioner

Society had taken the plea that the Arbitrator after passing the award dated

06.01.1990 did not send a copy of the same to the petitioner. He submitted

that under Rule 89(4)(b) of the Delhi Cooperative Societies Rules, 1973, the

award was to be communicated to the petitioner Society by registered post.

Rule 89, to the relevant extent, reads as under:-

              "Rule 89      Award of Decision.

              XXXX          XXXX           XXXX          XXXX

4. The award shall be communicated to the parties by

(a) pronouncement of the award, or

(b) registered post to any party which may be absent on such date.

XXXX XXXX XXXX XXXX"

9. It is clear from a reading of the Rule that since the petitioner

Society was not present on the date of pronouncement of award i.e., on

06.01.1990, clause (a) of sub-rule (4) of Rule 89 would not apply.

Therefore, the award had to be communicated by registered post to the

petitioner Society in terms of clause (b) of sub-rule (4) of Rule 89. The

learned counsel for the petitioner drew our attention to the fact that the copy

of the award was received by the petitioner Society only from the respondent

No.3 and not from the respondent No.2 and, that too, along with a letter

dated 08.03.1990 as would be apparent from paragraph 13 of the appeal

memo before the Delhi Cooperative Tribunal. It is thereafter that the

petitioner applied for a certified copy of the award which was not available

with the petitioner Society at the time of filing of the appeal but was made

available to the petitioner Society during the pendency of the appeal and the

same was filed immediately thereafter, before the disposal of the appeal.

Thus, according to the learned counsel for the petitioner, the non-filing of

the copy of the award along with the appeal could not be a ground for

rejection of the appeal of the petitioner. Insofar as the question of delay is

concerned, the learned counsel for the petitioner submitted that an

application for condonation of delay had been filed along with the

memorandum of appeal as recorded in the impugned order dated 24.05.1990

itself. However, the said application has not at all been discussed in the

impugned order. The only reference to the said application is that such an

application was filed. The Tribunal has not considered the said application

on merits and, therefore, the rejection of the appeal on the ground of the

delay could not be sustained.

10. As regards the decision of the Tribunal on the question of

opportunity not having been granted to the petitioner before the Arbitrator,

the learned counsel for the petitioner reiterated that the date of 06.01.1990

before the Arbitrator was only for filing of documents and not for arguments

and, therefore, the non-appearance on the part of the petitioner Society could

not have the entailed serious consequence of a decision on merits in the

absence of the petitioner. The petitioner Society ought to have been granted

an opportunity for presenting arguments.

11. We have considered the arguments advanced by the learned

counsel for the petitioner and have also examined the papers on record. We

feel that the impugned order passed by the Tribunal on 24.05.1990 as also

the award dated 06.01.1990 cannot be sustained. It is clear from paragraph 4

of the award dated 06.01.1990 itself that Sh. N.S. Negi, Secretary of the

petitioner Society also demanded certain information/documents "for which

purpose the case was adjourned for 06.01.1990". The Arbitrator also

directed the Society to produce the ledger and accounts concerning the case

as also to give photostat copy of the letter dated 22.12.1989. From these

statements contained in the award itself, it is clear that 06.01.1990 was the

date fixed for filing of documents and furnishing of information, it was not a

date fixed for hearing the final arguments in the case. We feel that the

Arbitrator ought to have given another opportunity to the petitioner Society

to represent its case. A peremptory notice could have been given and if

thereafter the petitioner Society did not appear, it would have been open to

the Arbitrator to have gone ahead and have made his award. However, we

feel that the Arbitrator rather acted hastily in this case and concluded the

case on 06.01.1990 itself, a date which was fixed for furnishing

documents/information. We also feel, prima facie, that it is not as if the

petitioner Society had no case at all. The counter claim of the petitioner with

regard to the amount due from the respondent No.4 also needed

consideration. This fact was also completely lost sight of. The figure of Rs

86,000/- towards cost of flat was certified only for the purposes of house tax

and did not reflect the total amount due from the respondent No.4. This

aspect of the matter needed consideration which had not been gone into by

the Arbitrator or the Tribunal.

12. Insofar as the impugned order dated 24.05.1990 is concerned,

we find that the findings given by the Tribunal on all the three points cannot

be sustained. While it is mentioned that the appeal was not accompanied by

a copy of the impugned award, the Tribunal has not taken account of the

facts mentioned in the appeal memo itself that the award was not

communicated to the petitioner in terms of Rule 89(4)(b) of Delhi

Cooperative Societies Rules, 1973. With regard to the question of delay,

we agree with the learned counsel for the petitioner that, apart from

mentioning that a condonation of delay application had been filed by the

petitioner, there is no discussion as to whether the grounds for condoning

delay were acceptable or not. As regards, the question of lack of

opportunity, we have already indicated that the petitioner has been able to

demonstrate that a full and fair opportunity was not granted to the petitioner

Society to put forth its case before the learned Arbitrator. Thus, on all three

grounds, the impugned order dated 24.05.1990 deserves to be set aside.

13. Consequently, the writ petition is allowed, the impugned order

dated 24.05.1990 as also the award dated 06.01.1990 are set aside. The

respondent No.1 (Registrar of Cooperative Societies) is directed to refer the

matter afresh to a new Arbitrator to decide the disputes between the parties.

We hope that the award shall be finalized at an early date after giving full

opportunity to the parties. The parties shall bear their respective costs.

BADAR DURREZ AHMED, J

VEENA BIRBAL, J OCTOBER 08, 2009 srb