The Nav Nirman Cooperative Group ... vs A.K.Murarka & Ors.
2010 Latest Caselaw 4643 Del

        *                 IN THE HIGH COURT OF DELHI AT NEW DELHI



                                               Reserved on : 27.09.2010
        %                                   Date of decision : 01.10.2010

        +                         WP (C) No.588/2009


        THE NAV NIRMAN COOPERATIVE GROUP HOUSING SOCIETY
        LTD.
                          ...    ...    ...   ...    ...PETITIONER

                     Through :          Mr.Rakesh Munjal, Sr.Adv. with
                                        Mr.Maneesh Goyal and Ms.Diksha
                                        Munjal, Advocates.

                                        -VERSUS-

        A.K.MURARKA & ORS.                      ...       ...             RESPONDENTS

                   Through :            Mr.Nalin Tripathi, Advocate for R-1
                                        and R-2.


                                               AND

        +                        WP (C) No.9002/2009


        VIJAY GUPTA & ORS.              ...       ...       ...             ...PETITIONERS

                     Through :          Mr.Rakesh Kumar Garg, Advocate for
                                        the Petitioners

                                        -VERSUS-


        THE NAV NIRMAN COOPERATIVE GROUP HOUSING SOCIETY
        LTD. & ORS.
                                    ...      RESPONDENTS


            Through :                   Mr.Rakesh Munjal, Sr.Adv. with
                                        Mr.Maneesh Goyal and Ms.Diksha
                                        Munjal, Advocates for R-1.

                                        Mr.Nalin Tripathi, Advocate for R-2
                                        and R-3.



_____________________________________________________________________________________________
WPC 588/2009 and WPC 9002/2009                                                   Page 1 of 14
         CORAM:
        HON'BLE MR. JUSTICE SANJAY KISHAN KAUL
        HON‟BLE MS. JUSTICE VALMIKI J.MEHTA


        Whether the Reporters of local papers
        may be allowed to see the judgment?                             YES

        To be referred to Reporter or not?                              YES

        Whether the judgment should be                                  YES
        reported in the Digest?


        SANJAY KISHAN KAUL, J.

1. The Nav Nirman Cooperative Group Housing Society

Ltd.(„the Society‟ for short), a registered society and

now governed by the provisions of Delhi Cooperative

Societies Act, 2003 was allotted 4.4 acres of land

being Plot No.7, I.P.Extension for construction of

residential flats for its members. The Society has 264

members and flats were constructed for the members.

There were only 118 covered car garages available

against those flats. Applications were invited from the

members on 26.06.1990 estimating the cost of each

garage at Rs.30,000/-. In view of there being less

garages than the applicants, a draw of lots was held

on 24.02.1991 and the successful persons were

allotted garages. Soon thereafter, one of the

members surrendered a car garage which was allotted

to the first member on the waiting list since the

waiting list was maintained of the members who had

not been allotted garages.

_____________________________________________________________________________________________

2. Flats allotted by DDA and by societies in Delhi were

sold on a power of attorney basis in large numbers.

This modus was adopted on account of there being

restriction on transfer of such flats (or plots) and thus

agreement to sell, GPA, SPA, Will etc. were a set of

documents which were executed for transfer of such

flats/plots. In order to regularize such transfers, a

scheme was propounded for conversion of leasehold

rights into freehold on payment of certain premium.

The premium was 33 per cent larger for flats sold on a

power of attorney basis.

3. Some of the members of the Society sold the flats.

The car garages were also sold where a member had

been allotted such a garage. R-1 to R-4 in WP(C)

No.588/2009 challenged the sale of garages by filing a

claim petition under Section 60 of the Delhi

Cooperative Societies Act, 1972. These claim petitions

were dismissed by the arbitrator vide an order dated

10.06.2004. The said respondents, R-1 to R-4,

preferred an appeal before the Delhi Cooperative

Tribunal. This appeal was allowed on 08.06.2007 in

terms whereof the Society was directed to take legal

action against original allottees of parking spaces who

had sold their flats to others, recover the parking

spaces from them and then allot them to the

waitlisted members of the Society. The General Body

_____________________________________________________________________________________________

of the Society passed a resolution on 30.09.2007

resolving that in modification of the earlier resolutions

on this subject, allotment of covered car and scooter

garages, be treated on ownership basis with heritable

and transferable rights at par with the flats and

simultaneously resolved to file a review application in

respect of the order dated 08.06.2007. The review

application was thereafter filed, but the same was

dismissed as barred by time in terms of the order

dated 24.03.2008.

4. The Society has filed a WP(C) No.588/2009 under

Articles 226 and 227 of the Constitution of India

seeking quashing of the orders dated 08.06.2007 and

24.03.2008 passed by the Delhi Cooperative Tribunal.

Simultaneously, three transferees of the flats, who got

the benefits of the garages also filed a writ petition

being WP(C) No.9002/2009 challenging the same very

orders.

5. The impugned orders are predicated on a reasoning

that the Society while deciding to allot parking spaces

on licence basis had not anticipated the result of

future sales of flats on power of attorney basis. The

appellants before the Tribunal (original claimants)

were members of the Society who had not raised the

issue in the General Body Meetings when deliberations

took place and allotments were made. The lump sum

_____________________________________________________________________________________________

amount recovered from the allottees was stated to be

a security deposit to be refunded at the time of

surrender of parking spaces. It was thus concluded

that the arbitrator had fallen into an error in holding

that the power of attorney purchasers had stepped

into the shoes of the original members as parking

space was not a part of the space of the flat. It is in

these circumstances that the directions referred to

aforesaid were issued.

6. We have heard learned counsel for the parties and

perused the record before us.

7. In our considered view, the first aspect which must be

taken into account is that these garages (which are

called by the original claimants as stilt parking) are

incidental to the allotment of flats. It is not as if

these car parking spaces have been sold as separate

spaces, but since the parking spaces were not

sufficient in number, matching the number of flats, a

draw of lots was held to allot the parking spaces. This

is the fairest method and no doubt has been cast on

such allotment of parking spaces. The minutes of the

Special General Body Meeting held on 24.02.1991

placed before us show the drawing up of a list of 118

successful members and 68 members were placed on

the waiting list. The original claimants also did not

_____________________________________________________________________________________________

challenge the same and thus everybody was satisfied

with the process of allotment of the garage spaces.

8. The sale of flats through power of attorney basis has

not only received judicial recognition but statutory

recognition as per Section 91 of the Delhi Cooperative

Societies Act, 2003 which reads as under:

"Special provision for regularisation of occupancy right of persons who have acquired such a right through the instrument of power of attorney or agreement for sale.

91. Any person who has acquired property on occupancy right in a co-operative housing society through the instrument of power of attorney or agreement for sale shall have the opportunity to become member of the concerned co-operative housing society where the property exists by getting the property converted from leasehold to freehold and on paying the transfer fee to the concerned co- operative housing society along with dues, including the dues of the apex or financial institution, if any :

Provided that a power of attorney holder or purchaser of property through agreement of sale and purchase in a co-operative housing society shall get the said property converted from lease hold to free hold within a period of three hundred and sixty days at the commencement of this Act and all subsequent sales and purchases of such property after the commencement of this Act, the property shall be converted from lease hold to free hold within three hundred and sixty days, failure to do so shall be deemed to be an offence under section 118 :

Provided further that any such person can have access to the paid services provided by the committee, namely the use of community hall, swimming pool or any other common facilities available to the members or the use of common parking spaces provided by the co-operative housing society only in the event of his becoming member as aforesaid and the transfer _____________________________________________________________________________________________

fee for becoming member shall be ten thousand rupees or as may be revised by the Registrar from time to time."

9. In view of the aforesaid provisions, there can be little

doubt over the rights of the purchasers of the flats and

that is not even a dispute before us. The only

question to be examined is whether a member who is

an allottee of the flat and has also got the allotment of

the garage, is entitled to transfer the rights in respect

of the garage while transferring the rights in the flats.

In our considered view, the answer to this question is

in the affirmative.

10. It cannot be lost sight of that the enjoyment of

the garage is incidental to the flat. The garages were

never sold or given on a licence basis by the Society

separately to third parties. These garages were

allotted through a draw of lots to the successful

parties who were occupants of the flats. Thus, it

cannot be said that the purchasers of the flats on a

power of attorney basis can be deprived of the

enjoyment of the parking space.

11. We may notice at this stage that both the

Society as well as the other set of petitioners before

us do not dispute the fact that there can be no

separate sale of these garage spaces to third parties

who are not allottees/occupants of the flats. It is thus

_____________________________________________________________________________________________

not permissible for the owners to enjoy garages de

hors the enjoyment of their flats.

12. The decision taken to allot these garages was in

a General Body Meeting of the Society which is

binding on all members including the original

claimants, who participated in the meeting. Not only

that, the subsequent resolution of a General Body has

been brought to our notice albeit after the initial

decision of the Appellate Tribunal dated 08.06.2007

when on 30.09.2007 the following resolution was

passed.

" Resolved that in modification to all earlier resolutions on the subject, allotment of covered car and scooter garages be treated on ownership basis with heritable and transferable rights at par with flats."

13. The aforesaid resolution to the extent it is

treating the covered car garages as heritable and

transferable at par with the flats is thus also collective

decision of the members of the Society and binding on

all the members. No doubt, the endeavour of the

Society to seek review of the order of the Tribunal

failed on the ground of limitation.

14. Learned counsel appearing for R-1 and R-2 in

WP(C) No.588/2009 who are the same as R-2 and R-3

in WP(C) No.9002/2009, are the only contesting

parties before us („the contesting respondents‟ for

short), sought to contend that there were several

_____________________________________________________________________________________________

apprehensions that if the impugned judgment of the

Delhi Cooperative Tribunal was set aside an anarchy

would prevail as outsiders/non members living in

adjoining unauthorized colonies would purchase

covered car parking spaces. Such an apprehension, in

our considered view, is misplaced since it had been

conceded by the Society, and rightly so, that the

enjoyment of the garage spaces can only be by an

owner/occupant of the flat and not by any third party

as the enjoyment and occupation of the garage space

is incidental to the flat.

15. Similarly, an apprehension expressed that there

would be confusion on account of the fact that in multi

storyed flats, each flat owner is entitled to

proportionate share in the land beneath the flat while

purchasers of covered car parking space may claim

proportionate rights, thereby reducing the rights of

the flat owners, is misplaced. Learned counsel for the

contesting respondents submits that the covered car

parking spaces may not be beneath the flats in

question. The misconception arises from a premise as

if the undivided share in the land of the flat owners

are beneath their tower. This is not so as all members

have proportionate undivided share in the land for all

the covered and common area. The enjoyment of the

car parking space is being given on certain conditions

_____________________________________________________________________________________________

and does not create any extra rights in the

proportionate share in the land.

16. Learned counsel for respondents 1 & 2 also

seeks to rely upon the decision taken by the GBM vide

Resolution No.4 dated 28.6.1992 in the following

terms:

"(a) members shall use the allocated parking space only for the purpose of parking their vehicles;

(b) the allocation of parking space shall be only on license basis and not on ownership basis;

(c) the deposit for one parking space as enumerated below shall be treated as non-interest bearing deposit only;

(i) covered car parking space (big) - Rs.30,000/-

(ii) covered car parking space (small) - Rs.26,250/-

(iii) covered scooter parking space (big) - Rs.7,500/-

(iv) covered scooter parking space (small)- Rs.5,200/-

(v) open car parking space - Rs.7,000/-

(e) An annual license fee of Rs.5/- for covered car parking, Rs.2/- for covered scooter parking and Re.1/- for open car parking space shall be paid by the members to whom these parking spaces are allotted for each financial year or part thereof on or before 30th April each year.

(f) The members, who have been allotted parking space on license basis, shall not transfer this right to any other person or organizations."

(emphasis supplied)

Learned counsel, thus, submits by reference to Clause

(f) aforesaid that the members who have been allotted

parking space on license basis have no right to

transfer the same to any other person or organization

as per the decision of the GBM.

17. In our considered view, a proper meaning has to be

given to this decision and the objective is clear that _____________________________________________________________________________________________

the restriction on transfer is to "any other person or

organization". This would imply that a person cannot

hold the flat and transfer the car parking space/garage

separately and create rights in the same. Third

parties who are not members and who do not own a

flat are not entitled to hold a garage. The space is

only capable of being used for car parking of vehicles

as per Clause (a) of the Minutes of the GBM held on

28.6.1992. This would not imply that if the flat itself is

transferred the car parking space cannot be

transferred with the transfer of the flat.

18. Learned counsel for the contesting respondents also

sought to draw strength from a recent judgment of the

Supreme Court in Civil Appeal No.2544/2010

Nahalchand Laloochand Pvt.Ltd v. Panchali

Cooperative Housing Society Ltd. decided on

31.08.2010 to contend that stilt car parking is

common to all flat owners. A close scrutiny of the

judgment, however, shows that the same has no

application to the present case. Firstly, it is not the

case of R-1 and R-2 that the area should be used

common to all flat owners rather R-1 and R-2 claim

exclusive rights to the car parking spaces. Secondly,

the judgment of the Supreme Court is in the context of

statutory provisions in question dealing with

apartments in Maharashtra. The factual matrix of that

_____________________________________________________________________________________________

case is that the promoter sought to claim the rights to

sell the stilt car parking spaces separately. The

conflict was between the promoter and the Society.

The Society pleaded that a promoter had no right to

sell or dispose of the space. The claim of the

promoter was based on the plea that stilt parking

space being a garage was an independent unit under

the Maharashtra Ownership Flats (Regulation of the

Promotion of Construction, Sale, Management and

Transfer) Act, 1963. It was held that the stilt car

parking space could not fall within the definition of a

flat and was part of common area and could not be

sold separately. The promoter thus did not have a

right in the same and the very purpose of enacting the

aforesaid Act would be defeated since the flat

purchasers would continue to be exploited indirectly

by the promoters.

19. In the facts of the present case, a collective

decision was taken by the members of the Society

itself by passing a resolution to allot car parking space

to certain members through a draw of lots to which

the contesting respondents were a party. There

have been subsequent resolutions to give heritable

right to the space again in a General Body Meeting.

Even if the private respondents are not happy with the

same, it is a collective decision of the majority so the

_____________________________________________________________________________________________

whole basis is that an occupant who was originally

successful in the draw of lots for the garage should be

able to transfer the rights of enjoyment of the car

parking space along with transfer of the flat when it so

occurs.

20. In the end, learned counsel for the contesting

respondents sought to contend that there were some

transfers made not to the same person who purchased

the flat on a power of attorney basis but to another

flat owner in the Society. Such a course of action

could have been doubtful but in view of the resolution

of the Society passed in the General Body Meeting

held on 30.09.2007 to treat the covered garages on

ownership basis with heritable and transferable right

at par with the flats, no grievance even in that behalf

can be made. It is, however, without doubt that the

garage space has to go only to a flat owner in the

Society and not to any third party who is an outsider.

21. We thus set aside the impugned orders dated

08.06.2007 and 24.03.2008 of the Delhi Cooperative

Tribunal making the Rule absolute directing that in

case of sale of the flats on power of attorney basis,

rights in the car parking can also be transferred but

the same cannot be transferred to an outsider who is

not an owner of the flat.

_____________________________________________________________________________________________

22. The petitions are allowed in the aforesaid terms

leaving the parties to bear their own costs.

SANJAY KISHAN KAUL, J.

        October 01, 2010                                         VALMIKI J.MEHTA, J.
        dm

_____________________________________________________________________________________________