Kangra Adarsh Cooperative Group Housing Society Ltd. v. Delhi Cooperative Tribunal

1. The present writ petition has been preferred by the Kangra Adarsh Cooperative Group Housing Society Ltd. impugning the award passed on 24.10.2011 by the learned Arbitrator and the order dated 18.3.2013 passed by the Delhi Cooperative Tribunal.

2. The only issue which arises before us in this writ petition is whether the Petitioner Society could charge any gate money/entry fee/development fund/transfer fee/common good fund from the Respondent No.2. The Respondent No.2, namely, Shri Gautam 2013:DHC:4614-DB Sharma filed a claim petition before the Registrar Cooperative Societies wherein it was claimed by him that he had purchased a flat No.K-290 in Kangra Adarsh CGHS Ltd. in 2001. At that time, the Society had demanded a sum of ` 50,000/- from him on account of Change of House Demand and for providing membership in the Society. He (Respondent No.2) had paid the said amount to the Petitioner Society through receipt Nos.8038 to 8047 (10 receipts) dated 5.7.2005 of ` 5,000/- each against the cheque No.325676 dated 2.5.2005 drawn on the Allahabad Bank for a sum of Rs.50,000/-. The Respondent No.2 contended that there is no provision in the law for demand of any such amount from a subsequent purchaser and the demand of such amount being illegal he was entitled to the refund of the money paid by him to the Petitioner Society towards C.H.D. (Change of House Demand).

3. By exercising the powers vested in him under Section 70 of the Delhi Cooperative Societies Act, 2003, the Registrar Cooperative Societies referred the matter to the arbitration of Shri S.C. Khatri (the Respondent No.3). Ultimately, an award in favour of the Respondent No.2 was passed on 24.10.2011 by Shri S.C. Khatri, the Respondent No.3. Vide the said award, the Petitioner Society was directed to refund the sum of ` 50,000/- to the Respondent No.2 along with interest @ 6% per annum within one month from the date of the order. The Petitioner Society was also directed to pay a sum of ` 5,000/- to the Respondent No.2 as costs of litigation. In default, the Petitioner Society was made liable to make the full payment as awarded with compound penal interest @ 2% per month thereafter.

4. Aggrieved by the said award, the Petitioner Society preferred an appeal before the Delhi Cooperative Tribunal, which was dismissed by the Tribunal vide order dated 18.3.2013. The present petition has been preferred for quashing of the award of the Arbitrator dated 24.10.2011 and setting aside of the order of the Delhi Cooperative Tribunal dismissing the appeal therefrom.

5. The case of the Petitioner Society is that the Respondent No.2 voluntarily donated a sum of ` 50,000/- towards Community Hall Donation (C.H.D.) and the Petitioner Society duly issued receipts dated 5.7.2005 for the same, i.e., 10 receipts of ` 5,000/- each. The Respondent No.2, it was contended, had misled the learned Arbitrator by stating that the Community Hall Donation (C.H.D.) of ` 50,000/was towards Change of House Demand. Furthermore, it was stated that besides Respondent No.2, other members of the Petitioner Society had also given voluntary donation for which receipts had been duly issued to them. Respondent No.2 had applied for membership of the Society vide application dated Nil and deposited the required amount of transfer fee of ` 500/- vide receipt No.3525 dated 13.10.2007 and share money of ` 100/- and admission fee of ` 10/- vide receipt No.3537 dated 16.10.2007. The allegation made by the Respondent No.2 that the Petitioner Society had taken illegal money on account of membership and Change of House Demand by Respondent No.2 is false and baseless. The learned Tribunal, therefore, wrongly equated the amount deposited by the Respondent No.2 with the Petitioner Society with the imposition of entry fee.

6. It was further contended on behalf of the Petitioner that the reliance placed by the learned Tribunal upon the decisions of this Court rendered in Capt. Kapil Raina v. DDA, 99 (2002) DLT 741; Navkund Coop. G/H Society Ltd. v. RCS, SLP (C) No.24506/2002 decided by this Court on 9.1.2003; Devender Gupta & Ors. v. RCS, 99 (2002) DLT 741; Dr. Rakesh Kishore v. RCS, 105 (2003) DLT 390 and Kusum Lata Gupta v. RCS, 140 (2007) DLT 544 was wholly misplaced. The said decisions have no application to the facts of the present case; what was charged from the Respondent No.2 was not entry fee but was infact a voluntary donation made by the Respondent No.2 for the Community Hall.

7. We have heard the counsel for the parties and are of the view that the Petitioner Society could not receive such amount whatever may be the full form of the abbreviation ‘C.H.D.’. The fact remains that this amount was not legally chargeable. The plea of the Petitioner Society that the receipts had been filled in by the Respondent No.2 in his own handwriting does not make the payment legal. By virtue of Rule 92(3) of the Delhi Cooperative Societies Rules, 2007, no amount towards donation or contribution on any pretext or name could have been collected by the Managing Committee of the Petitioner Society from the transferor or the transferee of the flat in question. It has been rightly observed by the Cooperative Tribunal that the imposition of entry fee whether by giving it the nomenclature of gate money/entry fee/development fund/transfer fee/common good fund has been held to be illegal in a line of decisions rendered by this Court. It also cannot be lost sight of that the Petitioner Society is not a charitable institution and the question may well be asked as to how many members would voluntarily donate ` 50,000/- for a Community Hall to be constructed by the Society. The business of the Society is to construct flats and make allotment of the same to its members, which includes the provision of and maintenance of the common facilities available to all the members. The demand of entry fee by whatsoever nomenclature is clearly violative of the Delhi Cooperative Societies Act and Rules.

8. This petition is accordingly dismissed with costs and disposed of. CM No.12774/2013 also stands disposed of.

REVA KHETRAPAL JUDGE PRATIBHA RANI JUDGE September 12, 2013 km