Ashokkumar Raghuram Thakkar vs Lalitbhai Hashmukhbhai Maniyar
2021 Latest Caselaw 17355 Guj

     C/AO/121/2021                               IA ORDER DATED: 17/11/2021




            IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

               CIVIL APPLICATION (FOR STAY) NO. 1 of 2021
                                  With
                  R/APPEAL FROM ORDER NO. 121 of 2021
==========================================================

ASHOKKUMAR RAGHURAM THAKKAR Versus LALITBHAI HASHMUKHBHAI MANIYAR ========================================================== Appearance:

for the PETITIONER(s) No. MR APURVA R KAPADIA for the PETITIONER(s) No. DR VENUGOPAL PATEL for the RESPONDENT(s) No. NOTICE SERVED BY DS for the RESPONDENT(s) No. ==========================================================

CORAM:HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI

Date : 17/11/2021

IA ORDER

1. The Regular Civil Suit No.1335 of 2019 came to be instituted by the respondent herein (original plaintiff) with the following prayers :-

"(A) Your Honour may be pleased to award the decree in

favour of I-Plaintiff and against the Respondents by declaring

that, the Respondents or their agents, servants or other third

parties have no right to obstruct in the suit property occupied

by me.

(B) Your Honour may be pleased to award the decree in

favour of I-Plaintiff and against the Respondents that, the

Respondents of this case or their servants, agents or third

party accomplices shall not do or cause to do any act which

C/AO/121/2021 IA ORDER DATED: 17/11/2021

may damage the property owned and occupied by I-Plaintiff

and which may obstruct the road accessing to the property

and the essential service like water, sewage or light.

(C) Please grant any other relief which may deem fit to the

Hon'ble Court.

(D) Please grant the cost of this Suit."

2. The appeal from order filed under Order 43 Rule 1 of the Civil Procedure Code alongwith civil application for stay wherein the appellant seeks to challenge the order dated 28.9.2021 passed by the City Civil Court No.5, Ahmedabad in Civil Suit No.1335 of 2019 below notice of motion Ex.6/7 by which the prayer in terms of para-10(A) came to be granted i.e. the appellant herein (original defendant No.1) came to be restrained from entering into the suit property and with a further direction not to disconnect the water, light and drainage connection till final disposal of the suit. The operative para of the order passed by the lower Court below Ex.6/7 is produced thus :-

"The notice taken out by the plaintiff is hereby allowed. The relief sought in para 10-A of this application is hereby allowed against the defendants and in favour of the plaintiff as prayed for till final disposal of the suit."

3. The appellant has approached this Court being aggrieved

C/AO/121/2021 IA ORDER DATED: 17/11/2021

and dissatisfied by the order dated 28.9.2021 passed by the learned City Civil Court, Ahmedabad below Ex.6/7.

4. The facts giving rise to this appeal are summarized as under :

4.1 It appears that the respondent No.1 (original plaintiff) is a member of the Flat No.B/6 in the Cooperative Housing Society known as "New Asiyana Apartment Cooperative Housing Society Ltd.," (for short 'society') which is registered on 6.5.1978 under the Cooperative Societies Act. There are in all 66 flats which were constructed before around 40 years and the said building is in a dilapidated condition. The Chairman and Secretary of the Society called general meeting of the members of the society on several occasions and passed resolutions and accordingly entered into an MoU with Art Nirman Ltd., and/or Dhara Developers for the redevelopment of the society. The appellant here is one of the partners of Art Nirman Ltd. In the said suit the respondent herein (original plaintiff0 has joined the appellant in the individual capacity and not in the capacity of Company or partnership firm.

Submissions on behalf of the appellant (original defendant No.1) :-

5. Mr. Apurva Kapadia, the learned counsel appearing for

C/AO/121/2021 IA ORDER DATED: 17/11/2021

the appellant vehemently submitted that the suit filed by the respondent herein is not maintainable inasmuch as the jurisdiction of the Civil Court itself is barred as the suit property is registered under the provisions of the Gujarat Cooperative Societies Act, 1961 and the respondent (original plaintiff) has not joined the New Asiyana Apartment Cooperative Housing Society Ltd., as party to the proceeding. The suit is filed against the private person and, therefore, the Civil Court has no jurisdiction to deal with the subject matter of the suit and the injunction ought not to have been granted. It is submitted that the issue involved in the suit is to be decided by the Cooperative Societies Tribunal as the dispute is between the members of the Association. The learned Civil Court has no jurisdiction to entertain such suit and, therefore, the lower Court ought not to have granted injunction as prayed for by the plaintiff.

5.1 It is submitted that though the plaintiff is a member of the society the plaintiff has chosen not to join proper party as party respondent with the malafide intention. It is submitted that the plaintiff has filed present suit without serving statutory mandatory notice as required under Section 167 of the Gujarat Cooperative Societies Act, 1961. The only remedy available under the law is to file a suit before the Board of Nominees. He submitted that only the Board of Nominees will be competent to decide the dispute between the parties under

C/AO/121/2021 IA ORDER DATED: 17/11/2021

Section 96 of the Gujarat Cooperative Societies Act, 1961.

5.2 Mr. Kapadia relied on the Civil Suit No.810 of 2019 which was filed by the member residing in Block No.B/3 and was identically situated as the present respondent. The Court below rejected the plaint under the provisions of Order 7 Rule 11 of the Code.

5.3 He lastly submitted that the order dated 28.9.2021 passed below Ex.6/7 is required to be quashed and set aside and present appeal from order is required to be allowed.

Submissions on behalf of the respondent (original plaintiff) :-

6. Mr. Venugopal Patel, the learned counsel for the respondents has filed a reply and mainly controverted the submissions made by the appellant. He submitted that there is no error committed by the Court below and the injunction rightly granted below Ex.6/7 in favour of the respondent (original plaintiff). He relied on the photographs produced alongwith the affidavit and submitted that the appellant herein was in breach of the order dated 28.9.2021. He further submitted that a Special Civil Application No.12970 of 2021 is filed challenging the order passed by the Ahmedabad Municipal Corporation granting permission for passing the plan for redevelopment of the society.

C/AO/121/2021 IA ORDER DATED: 17/11/2021

7. Heard Mr. Apurva Kapadia, the learned counsel appearing for the appellant and Mr. Venugopal Patel, the learned counsel appearing for the respondents.

Analysis :-

8. The respondents herein are members of the "New Asiyana Apartment Cooperative Housing Society Ltd.,". The appellant (original defendant No.1) has produced documents demonstrating that the respondent is signatory to the resolutions passed by the society from time to time for the purpose of redevelopment of the society. The society also entered into MoU dated 7.3.2019 with the appellant for and on behalf of the members of the society. The majority of the members and committee members executed MoU with the appellant (original defendant No.1). The respondent (original plaintiff) chose not to be a signatory in the MoU, though the name of the respondent figured in the list of the members of the society.

8.1 The provisions of Sections 96 and 167 of the Gujarat Co- operative Societies Act, 1961. Section 96 of the Act reads thus :-

"96 Disputes :-

(1) Notwithstanding anything contained in any other law for the time being in force, any dispute touching the constitution, management or business of a society shall be referred in the

C/AO/121/2021 IA ORDER DATED: 17/11/2021

prescribed form either by any of the parties to the dispute, or by a federal society to which the society is affiliated, or by a creditor of the society, to the Registrar, if the parties thereto are from amongst the following :-

(a) a society, its committee, any past committee, any past or present office, any past or present agent, any past or present servant or nominee, heir or legal representative of any deceased officer, deceased agent or deceased servant of the society, or the Liquidator of the society;

(b) a member, past member or a person claiming through a member, past member or a deceased member of a society, or a society which is a member of the society;

(c) a person, other than a member of the society, who has been granted a loan by the society, or with whom the society has or had transactions under the provisions of section 46, and any person claiming through such a person ;

(d) a surety of a member, past member or a deceased member, or a person other than a member who has been granted a loan by the society 46, whether such a surety is or is not a member of the society;

(e) any other society, or the Liquidator of such a society.

(2) When any question arises whether for the purposes of sub- section (1) a matter referred to for decision is a dispute or not, the question shall be considered by the Registrar, whose decision shall be final.

Explanation I.--For the purposes of this sub-section, a dispute shall include-

(i) a claim by a society for any debt or demand due to it from a member, past member or the nominee, heir or legal representative of a deceased member, without such a debt or demand be admitted or not ;

(ii) a claim by a surely for any sum or demand due to him from the principal borrower in respect of a loan by a society and recovered from the surety owing to the default of the principal borrower, whether such a sum or demand be admitted or not ;

(iii) a claim by a society for any loss caused to it by a member, past member, or deceased member, by any officer, past officer or deceased officer by any agent, past agent or deceased agent, or by any servant, past servant or deceased

C/AO/121/2021 IA ORDER DATED: 17/11/2021

servant, or by its committee, past or present whether such loss be admitted or not ;

(iv) a refusal or failure by a member, a past member or a nominee heir or legal representative of a deceased member, to deliver possession to a society of land or any other asset resumed by it for breach of conditions of the assignment.

Explanation II.--For the purposes of this section, the expression "agent" includes in the case of a housing society, an architect, engineer or contractor engaged by the society."

Clearly the respondents are member of the Cooperative Housing Society and any dispute which arises between the members of the society.

Section 167 of the Act reads thus :-

"167. Notice necessary in suits :-

Save as otherwise provided in this Act, no suit shall be instituted against a society, or any of its officers, in respect of any at touching the business of the society, until the expiration of two months next after notice in writing has been delivered to the Registrar or left at his office, stating the cause of action, the name, description and place of residence of the plaintiff and the relief which he claims, and the plant shall contain a statement that such notice has been so delivered or left."

8.2 In the case of Kotecha Brothers vs. Bileshwar Khand Udyog, reported in 2001 (4) GLR 3350 wherein this Court has held in paragraphs 8 and 9 thus :-

"8. In the facts of the present case, it is not in dispute that no notice under S. 167 of the Act was given before filing the Suit. It is obvious from the plain reading of S. 167 itself that

C/AO/121/2021 IA ORDER DATED: 17/11/2021

in case the dispute in question touches the business of the Society, notice under S. 167 is a must. In fact, the provisions of Sec. 167 of the Act are akin to the requirement of giving a notice under S. 80 of C.P.C. in case Suits are required to be filed against the Government and its functionaries and it goes without saying that giving of such a notice under S.

167 of the Act is a pre-requisite or a condition precedent for the purpose of filing the Suit against the Co-operative Society in case the dispute touches the business of the Society. In fact, I find that according to the language of Sec. 167, which speaks of the dispute touching the business, it is not necessary that the dispute must be something directly across the business. Even if the dispute touches the business tangentially it would come within the mischief of Sec. 167 of the Act. If we assume the "business of the society" to be a Circle and the "dispute" simply touches the circumference of such a Circle and its fringes, it would be a dispute touching the business of the Society. In the facts of the present case, I find that the dispute arising out of the transaction for the purchase of the gunny bags required for the marketing of the stock of sugar manufactured by the Co-operative Society, is a dispute which is fully covered by the expression 'touching the business of the society' and the requirement of giving the notice under S. 167 for such a dispute to recover an amount against the contract with regard to the supply and purchase of such gunny bags, was directly a contract relating to the business and trading activity of the defendant - Shri Bileshwar Khand Udyog Khedut Sahakari Mandli Ltd. and the

C/AO/121/2021 IA ORDER DATED: 17/11/2021

trial court has rightly held that the Suit was not maintainable in absence of such a notice and, therefore, I find that the Suit has been rightly dismissed. The impugned judgment and decree does not suffer from any infirmity of fact or law.

9. There is no force in this Appeal. The same is hereby dismissed. In the facts of this case, the parties are left to bear their own costs."

8.3 In the case of Sterling Center Premises Owners Co-op. Societies Ltd., vs. Nanubhai R. Shah Prop. of Dash Publicity, reported in 2006 (3) GLR 1853 wherein this Court has held in paragraphs 5 to 9 thus :-

"5. Heard learned Advocate appearing in the matter and perused the order. In my view, the learned trial Judge has exhibited total non-application of mind while passing the impugned order. So far as filing of suit against a co-operative society is concerned, Section 167 of the Act provides as under :

167. Notice necessary in suits: Save as otherwise provided in this Act, no suit shall be instituted against a society, or any of its officers in respect of any Act touching the business of the society, until the expiration of two months next after notice in writing has been delivered to the Registrar or left at his office, stating the cause of action, the name, description and place of residence of the plaintiff and the relief which he claims, and the plaint shall contain a statement that such notice has been so delivered or left.

C/AO/121/2021 IA ORDER DATED: 17/11/2021

6. It is required to be noted that if any suit is filed against a Co-operative Society in respect of any Act touching the business of the Society, such suit is not maintainable without a statutory notice. It is not the requirement of Section 167 that if a third party, who is not a member of the Society, institutes a suit, he is not required to give such notice. The learned Judge has confused the issue by referring to Sections 96 and 97 of the Act. Those Sections have nothing to do with the suit filed by the plaintiff against defendant No. 2. It is irrelevant whether the plaintiff is a member of the Society or a third party. So far as Section 96 of the Act is concerned, the same deals with a dispute which is required to be referred to the Nominee of the Registrar. The learned trial Judge has completely misread the provisions of Section 167 of the Act, and on an erroneous ground, has rejected the application, and while doing so, has committed an error of jurisdiction in passing the impugned order. If a suit is instituted before a Civil Court against a co-operative society touching the business of the Society, then notice under Section 167 of the Act is mandatory. Whether the plaintiff is a third party, or not is absolutely irrelevant.

7. Since, the order passed by the learned trial Judge is based on a total misconception of law, this Revision Application is required to be allowed, and is allowed. The matter is remanded to the trial Court for re-consideration of the application filed by defendant No. 2 at Exh. 26. The learned trial Judge shall now decide the application afresh in the light of the observations made hereinabove. While deciding the

C/AO/121/2021 IA ORDER DATED: 17/11/2021

application, the trial Court shall consider whether the dispute raised in the plaint touches the business of the Society, and after considering the aforesaid aspect, the learned trial Judge is directed to decide application at Exh. 26 within a period of three months from the date of receipt of, the writ from this Court.

8. The Revision Application is accordingly allowed. Rule is made absolute, with no order as to costs."

8.4 Mr. Apurva Kapadia, the learned counsel appearing for the appellant has tendered an undertaking dated 17.11.2021 duly signed by the appellant which reads thus :-

UNDERTAKING ON AFFIDAVIT OF APPELLANT

I, Ashokkumar Raghuram Thakkar, Male, Aged- 48, Occupation: Business, At : 410, JBR Arcade, 4th floor, Nr R.K. Royal Hall, Science City Road, Sola Ahmedabad do hereby solemnly affirm and state on oath as under:-

1. I say that I am filing this undertaking and declare on oath that I shall not cause any hindrance in respect of water connection, drainage and electricity to the original plaintiff in respect of the suit property.

2. I am filing this undertaking subject to my rights available for implementation of the resolutions passed by the society under the Gujarat Co-Operative society act and under Gujarat Flat Ownership's Act including agitating an issue of non-maintainability of the suit before the appropriate forum.

3. This undertaking / consensus is given without admitting any rights and claims of the plaintiff.

Solemnly affirmed at Ahmedabad on this 17th day of

C/AO/121/2021 IA ORDER DATED: 17/11/2021

November, 2021.

Ashokkumar Raghuram Thakkar DEPONENT"

8.5 In view of this Court, the trial Court failed to consider the submissions made by the appellant. The trial Court has allowed the Ex.6/7 without taking into consideration the settled legal position of law as well as the order relied upon by the appellant in the Civil Suit No.810 of 2019.

8.6 In view of the undertaking dated 17.11.2021 filed by the appellant herein and the settled legal position of law the order dated 28.9.2021 passed by the City Civil Court No.5, Ahmedabad in Civil Suit No.1335 of 2019 below notice of motion Ex.6/7 requires to be quashed and set aside to the aforesaid extent. The same is quashed and set aside. The appeal from order stand disposed of. Consequently the civil application also stands disposed of.

8.7 It is clarified that the above observations are only with regard to order dated 28.9.2021 passed below Ex.6/7 in the Civil Suit No.1335 of 2019. The trial Court may consider all the rights and contentions of both the sides at the time of hearing of the suit.

(VAIBHAVI D. NANAVATI,J) K.K. SAIYED