R.K. Jain & Ors. v. B.R. Saini & Ors.

1 De-hors the merits of the matter, issues in the case, stage of the case and the contentions and counter contentions, it is agreed before this Court that essentially the suits itself can be and is accordingly disposed of in terms ofthe following consent directions (a) Fresh elections are to be held of the Governing Body of the Society called as India-CIS-Chamber of Commerce and Industry. Elections to be held of the Governing Body members will be in accordance with the Memorandum and Rules and Regulations of the Society without their existing the amendments whith the plaintiffs claim were made in terms ofthe Annual General Meeting dated CS(OS) 1811/2015 & CS(OS) 1594/2015 Page 2 of[5] 06.01.2014 and communicated to the Registrar of Societies by the communication dated 22.01.2014. (b) Elections will be conducted by an Election Officer cum Observer appointed by this Court. It is agreed that this Election Officer cum Observer will be Ms. Kanwal Inder, Retired District & Sessions Judge, Flat No. 60-B, Pocket-B, Siddartha Extension, New Delhi-110014 having Mobile Number 9810125752. The Election Officer cum Observer will conduct the elections in accordance v/ith the Memorandum and Rules and Regulations of the Society and this order passed today.

(c) Fees of the Election Officer cum Observer is fixed with the consentof the parties at Rs. 1 lakh plus actual clerical cost and which will be equally shared by the parties. 50 percent of the fees will be equally paid initially and 50 percent of the fees will be paid on the date when the list of members are finalized for participating in the elections.

2 The Election Officer cum Observer will fix a schedule of the elections inter-alia, fixing the dates for the following events (a) A cut off date with respect to final list of members of the General Body. Before that cut off date, in accordance with the Memorandum and Rules and Regulations of the Society fresh members can always be enrolled. (b) A cut off date for filing of nominations by persons who seekto be elected as a member ofthe Governing Body ofthe Society. CS(OS) 1811/2015 & CS(OS) 1594/2015 Page[3] of[5]

(c) The cut off date with respect to withdrawal ofthe nominations for being elected to the Governing Body ofthe Society.

(d) The date of the elections, and which date will be a date not before two weeks of the cut off date of withdrawal of the nominations. (e) Date of declaration of results.

3 If there are any disputes with respect to whether a person is or is not a member, it is agreed that the Election officer cum Observer will be entitled to take a decision with respect to the validity otherwise of the membership of a particular person. Election Officer cum Observer will also be entitled to take any and every decision with respect to the entire process of the elections including declaration of the results.

4 Notices will be issued by the Election Officer cum Observer to each and every existing member of the Society communicating today's order passed in these suits.

5 The Election Officer cum Observer will be entitled to completely supervise, conduct and take all decisions with respect to holding of elections and all matters incidental to the same. The entire election process will be concluded by the Election Officer cum Observer preferably within a period of four months of the receipt of the copy ofthe present order.

6 During this period till selection of the new Governing Body no expenditure except of a routine nature will be done by the present office bearers of the Society and if any expenditure which is not CS(OS) 1811/2015 &CS(OS) 1594/2015 Page[4] of[5] routine expenditure andnotpertaining to the elections haveto be done from the funds of the Society, then, any of the parties will approach the Election Officer cum Observer and it is agreed that the Election Officer cum Observer will take a necessary decision with respect to the requirement or otherwise of the expenditure from the funds of the Society.

7 If any issue which is an issue in any of the present two suits survives even after the elections to the Governing Body of the Society, then, any of the party is at liberty at that stage to file appropriate independent legal proceedings for seeking any reliefs which theparties think they are entitled to in accordance with law. ^

8 The interim orderpassed by this Court dated 26.05.2015 in CS (OS) No. 1594/2015 will continue till the declaration ofthe results of the elections ofthe Governing Body ofthe Society.

9 The Annual General Meeting which is called for today by the plaintiffs in CS (OS) No. 1594/2015 will be held without conducting any formal business ofthe Society.

10 Both the suits stand disposed of in terms of the present compromise/consent order.

11 Parties are left to bear their own cost. Dasti to counsel for the parties. VALMIKIJ. MEHTA, J JUNE 30, 2015 CS(OS) 1811/2015 &CS(OS) 1594/2015 Page 5of[5] - dhhaSeai \fld(L $-29. * IN THE HIGH COURT OF DELHI AT NEW DELHI + CS(OS) 1594/20:15 INDIA-CIS CHAMBER OF COMMERCE &INDUSTRY Plaintiff Through: Mr. Ravi Sikri, Sr. Adv. with Mr. Tanuj Khurana, Advocate versus JYOTSNA CHAUDHRI & ORS Defendant Through: Ms. Neelam Rathore and Puja Jain, Advocates % CORAM: HON'BLE MR.

JUSTICE VIPIN SANGHI ORDER 27.05.2016 R.P. No.264/2016 i Issue notice. Counsel for the defendant accepts notice. The parties have advanced their respective submissions, and Iproceed to dispose ofthe said review application. By order ddted 30.06.2015, the court had directed holding of fresh elections of the ijlaintiff society under an election officer cum observer appointed by this bourt, namely, Ms. Kanwal Inder, retired Dist. &Sessions Judge. The suits and the pending applications were disposed of in terms of the said order. On 04.08.2015, this court passed further order in two applications moved under Order 47 Rule 1. This court observed that the new elected body which may come into office as aconsequence ofthe elections to be held under the election officer cum observer would take adecision whether to proceed in the criminal complaint against the defendants. The court also observed that fresh members could be enrolled by the society and the monies received from them could be deposited in the bank account. However, no bank account was opened to deposit the monies to be received from the newly enrolled members. Thereafter other proceedings have taken place, but which are not relevant to be noticed at this stage. By order dated 05.02.2016, the time for holding ofthe elections was extended by this court. The plaintiff then moved an application i.e. LA. No.3885/2016 to open a fresh bank account. The said application was dismissed with costs on 07.04.2016. Now, the present review petition has been preferredto seek review ofthe order dated 07.04.2016. In the meantime, the election officer cum observer has filed her report. From the report, it appears that only 17 nominations were filed, of which one was rejected. The election officer cum observer has observed that under Rule 8of the Rules and Regulations, the governing body of the society shall consist of not less than 25 and not more than 51 members. It also provides thatthe governing body will consist ofmembers elected by the general body - 1/3''* from amongstthe founder members, 1/3"^ from amongst the life members and 1/3''* from amongst the ordinary members. However, the requisite number ofnominations from the category of founder members were not received. In the category of life members, 10 nominations were received. In the aforesaid background, the election officer cum observer V observed that the elections to the plaintiffbody cannot be held. The submission of learned counsel on both sides is that Rule 8(f) of the Rules and Regulations has, in practice, not been adhered to and is not capable ofbeing adhered to. This is for the reason that most ofthe founder members of the plaintiff society have passed away with passage of time. The plaintiffsociety was founded in 1986 i.e. about 30 years ago. Thus, it is not possible to elect members ofthe governing body from amongst the founder members. Learned counsel for the plaintiffsubmits that only one or twofounder members may be alive as of date. Looking to the aforesaid circumstances, and that such aconstitutional crisis cannot be permitted to result in adeadlock such that the governing body itself cannot be constituted, the said Rule 8(f) has necessarily to be read down. With passage of time, this rule has become incapable of bemg implemented and, therefore, the requirement that the governing body should consist of atleast 1/3'"'' founder members cannot be considered to be a mandatory provision any longer. Attention has also been drawn by learned senior counsel for the plaintiff to Section 15 of the Societies Registration Act, 1860 which, inter alia, provides that in proceedings under the said Act, no person shall be entitled to vote or be counted as a member whose subscription at the time shall have been in arrears for the period exceeding three months. The definition of the expression "member" itself means one who has been admitted to the society in accordance with the rules and regulations thereof and who has paid the subscription or shall have signed the roll or list of member thereof and one who has not resigned in accordance with the rules and regulations. It is, therefore pointed out that payment of subscription prior to conduct of elections to the governing body is a mandatory requirement. It is noticed that in the elections called by the election officer cum observer, the said observer was given a goby. Learned counsel for the plaintiffsubmits that the returns ofthe society have not been filed with the Registrar ofSocieties for the last many years. However, according to the plaintiff, the same have been filed for the last three years, when they have been in management. Learned counsel for the plaintiffstates that the records pertaining to the society for the past years are not available with the plaintiff Counsel for the defendant states that even the defendants are not possessed ofthe records ofthe society, except for the period of about 1 !/2 years during which period the defendants were in management. In the aforesaid circumstances, with the consent ofparties, the earlier orders passed by this Court are modified in the following terms: