Rehabilitation Ministry Employees Cooperative House Building Society Ltd. v. G.R. Vasudev

1. The present writ petition challenges the order of the Delhi Cooperative Tribunal dated 24.09.2013 and the dismissal of the review by another order of 06.11.2013. The tribunal affirmed the award of the arbitrator dated 08.02.2009 made in the course of dispute referred to him under section 70 of the Delhi Cooperative Societies Act. 2014:DHC:3367-DB

2. The brief facts are that the petitioner – a Cooperative Society sought to proceed against the respondent, one of its members, Sh. G.R. Vasudev. It alleged that despite the existing resolutions which required payment of periodic maintenance charges, the respondent defaulted from 1999. The petitioner society contended that the respondent enrolled as its member in 1959 and had undertaken in the form of an affidavit to pay the service charges and other dues such as maintenance charges in the affidavit dated 01.09.1989.

3. It was submitted that up to 31.12.1998, the respondent continuously and regularly paid his dues, but started defaulting from 1999 onwards. On the basis of these allegations, a claim for arbitration was made to the Registrar of Cooperative Societies, who referred the disputes under section 60 of the then Delhi Cooperative Societies Act, 1972.

4. The arbitrator on 27.04.2003 made an award in favour of the petitioner allowing its claim. This was an ex-parte determination which led to the respondent member appealing to the Delhi Cooperative Tribunal.

5. On 05.12.2007, the Tribunal set aside the ex-parte award and remanded the case back to the Registrar with a direction that a new arbitrator be appointed. This was complied with on 30.07.2008 and eventually the newly appointed arbitrator by the award dated 08.02.2009 rejected the petitioners claim. In the course of the award, the arbitrator noticed and observed as follows:

6. The society appealed to the Cooperative Tribunal, which by its order dated 24.09.2013 affirmed the award of the arbitrator. The Tribunal was of the opinion that the claim was vague and bereft of particulars as to when the notices had been served upon the respondent member in respect of the dues. The Tribunal – like the arbitrator noticed the averments that the society’s claim, to have issued notices demanding dues from 1990 onwards, but copies of such notices as well as the precise amount claimed were not forthcoming.

7. Counsel for the society contended that if the impugned award and the order of the tribunal are upheld, considerable hardship would be caused to it and it would be denied any remedy to claim what are its just dues. He submits that the cooperative society which manages and maintains the premises of the society and its common areas is funded entirely by its members and that non-cooperation by them would lead to chaos. It is, therefore, submitted that even if there are some lacuna in the submission or pleadings, the interest of justice require that the matter should be remitted to allow the society to make good such defects and produce the necessary documents.

8. The above narrative would show that the society was successful in the first round; an ex-parte award was made in 2003. That, however, was set aside in 2007 by the tribunal, which remitted the matter for consideration. This time around, the award was made after consideration of all the materials. Apparently, even though the society placed on record the resolutions, it could not satisfy the arbitrator that periodic notices had been issued containing the exact amounts which had been defaulted. In these circumstances, the arbitrator can hardly be faulted in concluding that the dues as against the respondent had not been proved. Apart from proving service of notices with particulars, the society could possibly have persuaded the arbitrator with other collateral evidence, which too apparently was not forthcoming.

9. This Court is alive to the fact that persistent default by the members of the cooperative society could unsettle the task of the management to carry out routine repairs and maintenance, ensuring cleanliness of the premises would be rendered all the more difficult. The society is such cases have the authority to claim maintenance charges on the basis of resolutions, and seek its enforcement wherever there is default by any member. At the same time, the society is expected to keep its books, materials and other affairs in order at any given point of time and be in a position to show the authority – in case a claim is made that a recalcitrant member is, in fact, liable to be proceeded in the strictest possible manner. Both these aspects have to be highlighted.

10. In the present case that the society could not prove its dues does not mean that its authority is undermined. In case it has material available for any subsequent period, it is open to it claim such dues in accordance with law with cogent and convincing materials. That liberty is always available to it.

11. As far as the objection with regard to the remarks made by the arbitrator that the petitioner society has to be wound up, this Court is of the opinion that the said remarks were uncalled for given the fact that the dispute before the arbitrator was one between a member and the management concerning the right of the society to claim the arrears of maintenance and other dues.

12. The writ petition cannot succeed. However, this is subject to the liberty preserved in respect of the later period in accordance with law.

13. The writ petition is, accordingly, dismissed.

S. RAVINDRA BHAT, J