Delhi High Court
Pramod Kumar Gupta & Ors. vs Registrar Of Cooprative ... on 6 October, 2016
$~36
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 5271/2015 & CMs 9544/2015, 32278/2015 &
24838/2016
Date of Decision: 06th October, 2016
PRAMOD KUMAR GUPTA & ORS. ..... Petitioners
Through: Mr.D.K.Rustagi and Mr.Manan
Bansal, Advs.
versus
REGISTRAR OF COOPRATIVE SOCIETIES & ORS.
..... Respondents
Through: Mr. Santosh Kumar Tripathi,
ASc for GNCTD/Registrar,
Cooperative Societies/R1.
Mr.R.K.Gupta, Adv. for R2.
CORAM:
HON'BLE MR. JUSTICE SANJIV KHANNA
HON'BLE MS. JUSTICE SUNITA GUPTA
SANJIV KHANNA, J: (ORAL)
1. This case has a very long history of litigation. Late Mr. V.K.
Gupta was enrolled as a member of the Mother Dairy Cooperative
Group Housing Society Ltd. vide membership number 151. He had
deposited Rs.9,46,530/- towards cost of land and construction of the
flat being constructed by the Cooperative Society at Plot No.34, Sector
- 10, Dwarka Phase - I, New Delhi. Mr V.K. Gupta expired on
10.06.2000 leaving behind a widow and 6 other legal heirs. The
children had executed relinquishment deeds in favour of their mother
Lajjawati Gupta. Lajjawati thereafter applied for transfer /
transmission of membership in her name vide her application dated
27.07.2000 alongwith the death certificate, indemnity bond and other
documents. This was followed by her letter dated 19.09.2000.
Lajjawati Gupta had agreed to pay legitimate dues of the society and
to complete the formalities required.
2. The Cooperative Society by their letter dated 14.02.2001 raised
a demand of Rs.9,62,501.45/- and, at the same time, averred that they
had initiated expulsion proceedings against V.K. Gupta before the
Registrar, Cooperative Societies.
3. As the Cooperative Society was not ready and willing to accept
Lajjawati as a member, initiated proceedings under Rule 35(7) of the
Delhi Cooperative Societies Rules, 1973. By the order dated
31.05.2002, the Registrar, Cooperative Societies held and directed that
Lajjawati would apply to the Cooperative Society afresh and complete
all required formalities as per law within one month. The Cooperative
Society were directed to transfer V.K. Gupta's membership in
Lajjawati's name after completing all the legal formalities within one
month after receiving her application. The Cooperative Society was
further directed to raise a demand, if any, towards the cost of
construction of the flat and Lajjawati would clear all dues demanded
by the Cooperative Society. The Registrar, Cooperative Societies
dismissed the proposal of the Cooperative Society for expulsion of
V.K. Gupta. The consequence thereof was that V.K. Gupta's
membership remained valid and intact.
4. In a nutshell, V.K. Gupta's expulsion was rejected and this
would mean that Lajjawati had stepped into his shoes, being his wife
and legal representative. Pertinently, Lajjawati was the nominee of
V.K. Gupta as per the records of the Cooperative Society.
5. Consequent to the order dated 31.05.2002, Lajjawati applied for
transfer of membership in her name vide letter dated 14.06.2002. The
Cooperative Society, by their letter dated 29.06.2002 raised a demand
of Rs.6,55,641/-. In the meanwhile, the Cooperative Society filed a
revision petition before the Financial Commissioner under Sections 80
and 81 Delhi Cooperative Societies Act, 1972 impugning the order
dated 31.05.2002 passed by the Registrar, Cooperative Societies.
During the pendency of the said revision petition, Lajjawati expired on
21.12.2004 and his legal heirs were brought on record. The revision
petition remained pending for about 5 years and was disposed of vide
order dated 06.02.2007. Paragraph 8 of the said order reads as under:
"8. The Lower Court record clearly shows
that an inquiry was instituted under section
59(1) of the Act against Sh. V.K. Gupta,
which was concluded with a finding of a
liability of Rs.1.98 lacs being fixed on Sh.
V.K. Gupta. The inquiry is dated 10th
November, 1997. The petitioner society has
not denied that respondent no.2 had applied
for transfer of membership after the death of
late Sh. V.K. Gupta, on grounds that she was
valid nominee. It is the petitioner society's
case that respondent no.2 has to clear the
liability of the original member because she
had stepped into the shoes of late Sh. V.K.
Gupta, but the petitioner has simultaneously
maintained that they would transfer the
membership only after the outstanding
amount is cleared. Section 59(2) of the Act
provides that after an inquiry has been made
under section 59 (1), the RCS is required to
make an order which will indicate the
amount to be paid alongwith interest, if any.
Such an order under section 59(2) of the act
is not on record, nor has any such order
been relied upon by the petitioner. Hence, it
is clear that there is no order passed under
section 59(2) of the Act. I, therefore,
conclude that no liability had been fixed on
late Shri V.K. Gupta, during his lifetime
under section 59(2) of the Act. It is also
noteworthy that respondent no.2 had agreed
to clear all outstanding dues against demand
and this can do [sic.] be done only in the
capacity as a member of the society I,
therefore, agree that a non-member cannot
be forced to pay any amount to the society,
with which no relationship is yet established.
The RCS has correctly observed in the
impugned order that the society is required
to transfer the membership of late Shri V.K.
Gupta, in the name of respondent no.2 who
is the nominee, after completing all legal
formalities. In fact, the impugned order has
given relief to the petitioner society also
allowing it to raise legitimate demand and
has directed respondent no. 2 to clear such
dues. Under these circumstances, the
petitioner has not been able to show me any
reason for interference with the impugned
order."
6. The findings recorded in the aforesaid order were that Pramod
Kumar, son of Lajjawati, had agreed to clear all outstanding dues. The
dues were to be calculated by the Cooperative Society by treating
Lajjawati (represented by Pramod Kumar) as a member of the society.
The dues would not be raised against Lajjawati (represented by
Pramod Kumar) by treating her as a non-member.
7. After the aforesaid order, Pramod Kumar applied for transfer of
membership vide application dated 22.10.2008 and expressed his
willingness and readiness to make payment of the entire amount. This
was followed by the letter dated 23.04.2010 requesting compliance of
the order dated 06.02.2007. Pramod Kumar subsequently had sent a
legal notice dated 25.03.2011 to the Cooperative Society pressing his
case for enrolment.
8. It is the case of the respondent Cooperative Society that they
had replied to these letters written by Pramod Kumar. However, the
purported responses, which are denied, have not been placed on record
by the Cooperative Society.
9. Resultantly, Pramod Kumar was compelled to approach the
Registrar, Cooperative Societies who vide order dated 16.5.2012 in
exercise of powers conferred under Rule 35(7) of the Delhi
Cooperative Societies Rules 1973 (corresponding to Rule 30(7) of the
Delhi Cooperative Societies Rules, 2007) had directed as under:
"(i) Shri Pramod Gupta, son of Late Shri
V.K. Gupta & Late Smt. Lajjawati
Gupta will complete all the required
formalities (including Relinquishment
Deed executed by the other legal heirs
etc.) as per law within one month's
time; and
(ii) the Society will transfer the
membership of his father, late Shri
V.K. Gupta, in his name after fulfilling
all legal formalities within the next
one month. The Society is further
directed to raise demand, if any,
pending towards the construction of
flat and the applicant will clear such
dues as demanded by the Society."
10. Relinquishment deeds dated 07.06.2012 were executed by the
other five legal heirs of Lajjawati in favour of Pramod Kumar, and
these were submitted to the Cooperative Society on 13.06.2012. On
18.06.2012, the Cooperative Society issued a letter raising demand of
Rs.75,86,837/- along with a chart giving the calculations. Pramod
Kumar protested and complained vide letter dated 10.07.2012. His
grievance was that the cost of the flat was Rs.12,47,278/- and late Mr.
V.K. Gupta had already paid Rs.9,46,530/- (Rs. 8,83,780/- towards
principal and Rs. 62,750/- as interest). Pramod Kumar was liable to
pay the balance amount of Rs.3,68,598/- and was ready and willing to
pay simple interest on this amount from February 1998 to 31st, January
2002 at the rate of 10% per annum. He had objected to compound
interest being levied at the rate of 24% per annum up to 19.10.2007
and thereafter at the rate of 10% compounded annually. Pramod
Kumar made payment of Rs.8,14,287.25 by cheque towards balance
principal amount of Rs. 3,68,598/- and simple interest @ 10% per
annum. He made a request that flat no.301 which had been kept vacant
for allotment to the legal heirs of V.K. Gupta, may be allotted to him.
11. The cheque was returned by the Cooperative Society vide letter
dated 23.07.2012.
12. Aggrieved, Pramod Kumar approached the Registrar,
Cooperative Societies by filing applications vide letters dated 9th
May, 2013 and 16th January, 2014 protesting against the demand and
rate of interest. Pramod Kumar reiterated that he was ready and
willing to pay simple interest at the rate of 10%. In the letter dated
16.01.2014, Pramod Kumar had stated that he was ready and willing
to pay Rs.11,16,391 as per calculations made. The Registrar,
Cooperative Societies vide his order dated 27.05.2014 held that the
controversy or the dispute was required to be decided as per Section
70 of the 2003 Act. The dispute relating to quantum of demand cannot
be decided by him.
13. The Cooperative Society by their letter dated 20.07.2014
informed Pramod Kumar that they were refunding the amount paid by
V.K. Gupta along with 7% interest per annum after deducting
administrative charges. Pramod Kumar was required to collect the
cheque of Rs.17,44,180/- from the Society's office. Pramod Kumar
protested vide letter/notice dated 25.08.2014, written by his counsel.
14. Pramod Kumar once again approached the Registrar,
Cooperative Societies by way of a petition under Section 37 of the
2003 Act dated 22.10.2014, but no orders or directions were issued. In
these circumstances, with the issue remaining unresolved, Pramod
Kumar along with two brothers, namely, Pradeep Kumar Gupta and
Sanjay Gupta have approached this Court in the present writ petition,
which was filed on 16.05.2015.
15. It may be relevant to mention and refer to two orders passed by
this Court as they partially resolve and decide the controversy. The
order dated 01.09.2015 passed by the Division Bench of Gita Mittal
and I.S. Mehta, JJ., reads as under:-
"1. Our attention is drawn by Mr.D.K.Rustagi, counsel for the
petitioners to the demand raised by the respondent No.2-society
as the amount payable by late Shri V.K.Gupta upto 31st July,
2002. We find that dues of Rs.6,55,641/- stand quantified therein.
Shri V.K.Gupta unfortunately expired on the 10th June, 2000.
Smt.Lajjawati, as his first nominee sought transfer of
membership, who also expired on 20th December, 2004. The
request of other legal heirs of late Shri V.K.Gupta and
Smt.Lajjawati, i.e. petitioners herein is pending with the Society
ever since.
2. The order dated 6th February, 2007 was passed by the
Financial Commissioner in Case No.170/2002/CA filed by the
respondent No.2-society directing that question of dues would
arise only after legal heirs of deceased members had been
substituted. Even this order has not persuaded the respondent
No.2-society to consider the request of the petitioners. Our
intervention has been compelled by this non-compliance.
3. Even today, we find that an unfortunate stand is being taken on
behalf of the society before us. It is being contended that because
of the dues against Shri V.K.Gupta, the petitioners must be
diverted to the remedy of invoking arbitration under Section 70
of the Delhi Cooperative Societies Act. This is very unfortunate to
say
the least. Needless to state that Mr.Gupta, counsel for the society
insists on filing counter affidavit even in these facts.
4. Let a short affidavit be filed by the society within three days
from today. Rejoinder thereto, if any, be filed before the next date
of hearing. However, we make it clear that in case we agree with
the submissions of the petitioners, we shall be constrained to
impose heavy costs on the respondent No.2-society.
5. We are informed by Mr.D.K.Rustagi, counsel for the
petitioners that allotment of flats, other than single entry flats,
stands allotted and the legal heirs of the petitioners have been
wrongly deprived benefit of the flat as well.
6. In the meantime, the petitioners are permitted to deposit the
sum of Rs.6,54,641/- with the respondent No.2-society before the
next date of hearing without prejudice to their rights and
contentions and the said amount shall be accepted by the society,
being the payment which it had raised against the deceased Shri
V.K.Gupta. 6. List on 9th September, 2015."
16. The order dated 09.09.2015 again passed by the same bench
reads:
"1. The counter affidavit filed on behalf of respondent No.1
would show that there is no real dispute between the parties and
the respondent-society is only seeking completion of some
documents from the petitioner so as to transfer the membership
of the flat in question in the petitioner's name.
2. The petitioner shall submit the completed documents with the
respondent No.2-society within fifteen days with a copy of the
same to Mr.R.K.Gupta, learned counsel for the respondent-
society. The scrutiny shall be done by the respondent-society
within one week. In case there are any objections or any further
requirements by the society, the same shall be informed by
Mr.R.K.Gupta, counsel for the society to Mr.D.K.Rustagi,
counsel for the petitioner within one week of submission of the
documents. The objections, if any, shall be cleared/removed
within further period of one week. The petitioner shall pay
interest @ 10% on the amount of Rs.6,55,641/- w.e.f. 1st August,
2002 till the date of payment to the society within six weeks from
today.
3. It is submitted on behalf of the society that certain more dues
towards maintenance of the flat and other statutory dues have
been paid by the society in respect of the flat in question. Let the
details thereof be furnished to Mr.D.K.Rustagi, counsel for the
petitioner within a period of four weeks from today. The admitted
liability shall be cleared within one week of receipt of such
details. Counsel for the parties may also sit together and sort out
the pending disputes.
4. List on 23rd November, 2015.
5. A copy of this order be given dasti to counsel for the parties,
as
prayed."
The last sentence in paragraph 2 of the aforesaid order is relevant and
important. It states that the petitioner i.e. Pramod Kumar will pay
interest @ 10% on the amount of Rs.6,55,641/- w.e.f. 1st August,
2002 till the date of payment to the Society. This figure of
Rs.6,55,641/- represents the principal amount or the balance price of
the flat along with the interest which had accrued thereon till
31.07.2002. On this figure there was no lis or dispute between Pramod
Kumar and the Cooperative Society. This order had further directed
that Pramod Kumar would be liable to pay interest on Rs.6,55,641/-
with effect from 01.08.2002 at the rate of 10% till the date of payment
to the Cooperative Society.
17. We have been informed that the petitioner had made payment of
Rs.6,55,641/- on 6th September, 2015. Rs.8,74,200/- towards interest
was paid on or about 23.11.2015.
18. Paragraph 3 of the order dated 09.09.2015 had directed the
Cooperative Society to compute the dues towards maintenance of the
flat and statutory dues that have been paid by the Cooperative Society
in respect of the flat in question. The computation was to be furnished
to the counsel for the petitioner within 4 weeks. It was directed that
'admitted liability' would be paid within one week of the receipt of
demand. The counsel were directed to sort out the issues pending and
disputed.
19. The Cooperative Society has filed computation claiming an
amount of Rs.24,98,016/-. We have perused the computation and find
that the calculations made and demanded by the Cooperative Society
are exorbitant, wrong and unacceptable. In fact, the Cooperative
Society seeks to rewrite the order dated 09.09.2015, quoted and
reproduced above.
20. The construction charges due and payable including the interest
as on 31.07.2002 had been calculated and computed at Rs.6,55,641/-.
This amount of Rs. 6,55,641/- is final. Pramod Kumar has to pay
interest at the rate of 10% per annum on Rs. 6,55,641/- with effect
from 01.08.2002 till payment. The payment of Rs.6,55,641 was made
on 06.09.2015. The calculation made by the Cooperative Society
rightly takes the figure of Rs.6,55,641/- as the base for the year 2002 -
2003. However, the interest is computed on this figure at the rate of
10% compounded annually. This is impermissible and contrary to the
order passed by the Division Bench of this Court on 09.09.2015. Once
payment of Rs 6,55,641/- was made, the claim and demand towards
cost of construction and interest up to 31.07.2002 was settled. Pramod
Kumar has paid interest of Rs.8,74,200/- on Rs.6,55,641/- for the
period between 01.08.2002 till 08.09.2015 vide demand draft No.
04546 drawn on Dena Bank, Service Branch, New Delhi dated 10th
November, 2015 in accordance with the order dated 09.09.2015.
Interest has been computed at 10% per annum.
21. This leaves us with the controversy and question of the
maintenance charges and other demands, which are as under:
"Calculation of net amount payable after deducting maintenance an
d other charges:
S.No. Year Maintenance Interest Total
Charges Amount
1. 2002-03 10800 1077 11677
2. 2001-02 10800 2157 12957
3. 2003-04 10800 1080 11880
4. 2004-05 10800 1077 11877
5. 2005-06 10800 1077 11877
6. 2006-07 10800 1077 11877
7. 2007-08 12000 1200 13200
8. 2008-09 15512 1547 17059
9. 2009-10 19262 1921 21183
10. 2010-11 19262 1921 21183
11. 2011-12 19262 1926 21188
12. 2012-13 23262 2320 25582
13. 2013-14 33559 3347 36906
14. 2014-15 32146 3206 35352
15. 2015-16 32146 1605 33749
Total 271211 26536 297747
S.No. Particulars Charges Interest Total
Amount
1. Vacant land 10000 1997 11997
charges
2. Water charges 10667 1067 11734
3. Lift charges 60000 2499 62499
4. Legal Charges 229000 229000
Total 309667 5563 315230
22. The total principal amount claimed as maintenance charges is
Rs.2,71,211/. The Cooperative Society also claimed vacant land
charges of Rs.10,000/-; water charges of Rs.10667/-; lift charges of
Rs.60000/- and legal charges of Rs.2,29,000/-.
23. As far as legal charges are concerned, Pradeep Kumar should
not be burdened with the same. We have noted down the history of
litigation in the present order. We leave the parties to bear their own
costs.
24. Having noted the aforesaid facts, we will have to pass a just and
equitable order balancing the case of Pramod Kumar on the one side
and the Cooperative Society on the other side. The counsel for the
Cooperative Society has submitted that one flat was kept vacant and
the maintenance charges, water charges, vacant land charges and lift
charges have been paid by other members of the Cooperative Society.
Pramod Kumar, on the other hand, submits that he was deprived and
denied possession of the flat and had to run from pillar to post. Since
the flat was not in his possession, he is not required to pay
maintenance charges, water charges, vacant land charges and lift
charges. The lift charges are not payable because the petitioners have
not used the lift.
25. During the course of hearing, learned counsel for the
petitioners, on instructions, states that Pramod Kumar is ready and
willing to pay Rs.5 lacs to settle the matter and to bring this litigation
to an end. Learned counsel appearing for the Cooperative Society has
stated that he leaves it to the Court. The President of the Cooperative
Society is present in person in the Court. The figure suggested by
Pramod Kumar is just, fair and equitable. We accept the said
suggestion.
26. Pramod Kumar, however, apprehends that the Cooperative
Society will not hand over the possession of the flat even after
payment of Rs. 5 lakhs is made. Learned counsel for the respondent
Cooperative Society submits that papers have to be submitted and
cleared by the Registrar, Cooperative Societies. Once the papers are
cleared and approval is granted by the Registrar, Cooperative
Societies, the possession of the flat will be handed over.
27. To resolve the controversy, it is directed that the petitioners
would deposit the amount of Rs.5 lacs in the name of the Registrar
General of this Court and the same would be converted into an FDR
for a period of 3 months, and renewed for similar periods. On
intimation that the said deposit has been made, the Cooperative
Society will, within 15 days, forward the papers and documents to the
Registrar, Cooperative Societies. The Registrar, Cooperative Societies
will examine the papers and in case there is any deficiency, ask the
Cooperative Society and/or Pramod Kumar to appear and satisfy. The
Registrar, Cooperative Societies or his nominee will pass appropriate
orders within 2 months from the date when the papers are submitted.
In case there is any difficulty, the Registrar, Cooperative Societies
may move an application in the High Court seeking extension of time.
28. On the approval being granted by the Registrar, Cooperative
Societies possession of the flat would be given to Pramod Kumar.
After possession of the flat has been handed over to Pramod Kumar,
the Cooperative Society will move an application and the entire
amount of Rs.5 lacs along with interest accrued would be paid to the
Cooperative Society.
29. The counsel for the Cooperative Society states that the demand
draft of Rs.8,74,200/- dated 10.11.2015 towards interest has been
misplaced by him. The counsel for the petitioners states that they will
cooperate and ask the bank to issue a fresh / new draft. The
Cooperative Society and the petitioners will furnish an indemnity
bond as required by the bank for issuance of a fresh demand draft. We
hope and trust that the petitioners, as well as the managing committee
of the Cooperative Society, will cooperate.
30. The writ petition is disposed of in aforesaid terms.
31. Pending CMs are also disposed of.
SANJIV KHANNA, J
SUNITA GUPTA, J
OCTOBER 06, 2016/rd
