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W.P.(C) 4202/2014
Date of Decision: 31st January, 2017 RAKESH GROVER AND ORS ..... Petitioner
Through Mr. Venkita Subromoniam T.R, Mr. Rahat Bansal and Mr. Arjun Handa, Advocates.
Through Mr. Naushad Ahmed Khan, ASC, GNCTD with Mr. Manzar Anis, Advocate.
Ms. Archana Chibber, Advocate for Mr. Shashank Ahuja, Advocate for R-2.
Mr. Premtosh Mishra and Ms. Anvesha Dwivedi, Advocates for R-3 to 17.
UMESH KUMAR JAIN & ORS. ..... Petitioner
Through Mr. Premtosh Mishra and Mr. Anvesha Dwivedi, Advocates.
Through Ms. Niti Jain, Advocate for Mr. Anuj Aggarwal, ASC, GNCTD.
Ms. Archana Chibber, Advocate for Mr. Shashank Ahuja, Advocate for R-2.
Mr. Venkita Subromoniam T.R, Mr. Rahat Bansal and Mr. Arjun Handa, Advocates for R-3 to 12.
Mr. Dinesh Chander Yadav and Mr. A.S. Rishi, Advocate for respondent No.24.
2017:DHC:599-DB Mr. Rahul Kumar Singh, Advocate for R-6.
HON'BLE MR. JUSTICE CHANDER SHEKHAR SANJIV KHANNA, J. (ORAL)
This common order would dispose of the aforestated two writ petitions.
JUDGMENT
2. Writ Petition (Civil) No. 8553/2014, filed by Umesh Kumar Jain and 12 others impugns order dated 10th October, 2014 passed by the Financial Commissioner, whereby Revision Petition Nos.119/2012 and 151/2012 were dismissed.
3. Writ Petition (Civil) No. 4202/2014 filed by Rakesh Grover and 5 others, on the contrary seeks direction to the respondent-Registrar, Cooperative Societies to comply and implement the order dated 18th October, 2010 passed by the Supreme Court and that they should be given possession of the flat.
4. For the sake of convenience, we would refer to the petitioners in Writ Petition (Civil) No. 8553/2014 as Umesh Kumar Jain Group and the petitioners in Writ Petition (Civil) No.4202/2014 as Rakesh Grover Group. The Registrar, Cooperative Societies will be referred as the „RCS‟ and the Modern Cooperative Group Housing Society Ltd. has been referred to as the „Cooperative Society‟. We would also clarify that the expression „Rakesh Grover Group‟ would mean 14 members of the Cooperative Society, who were earlier expelled, but whose expulsion was set aside and treated as valid by the RCS.
5. In order to curtail prolixity, we would only refer to the relevant facts. Rakesh Grover Group, i.e. the expelled members, had approached the Supreme Court in Civil Appeal No. 9439/2003 asserting that they had paid subscription and all demands, yet the Cooperative Society vide resolution dated 27th April, 1987 had expelled 27 members. The RCS had never approved their expulsion. The Cooperative Society, on the other hand, had claimed that they had sought approval for expulsion of 27 members from the RCS on 20th February, 1988 and in the meanwhile, they had enrolled new members. The RCS had failed, when he kept quiet and did not pass any order on the application seeking approval of expulsion moved by the Cooperative Society. Subsequently, vide order dated 4th June, 1996, the RCS rejected and refused to grant approval for termination of membership. Consequently, the Cooperative Society had approached the Financial Commissioner in revision, which was dismissed vide order dated 30th July,
1996. The Cooperative Society filed Writ Petition (Civil) No.3325/1996 before this High Court in which an order of remand was passed for the RCS to reconsider. The RCS rejected the approval sought for expulsion of the 14 members who had appeared and had contested their expulsion vide order dated 26th August, 1997. Expulsion of others was accepted. The revision petition filed by the Cooperative Society before the Financial Commissioner, was dismissed vide order dated 3rd November, 1997. The Cooperative Society, however, succeeded in Writ Petition (Civil) NO. 2/1998, which was allowed vide order dated 4th September, 2002. The decision holds that the RCS had digressed and diverted from the actual enquiry and overlooked the factum that the application seeking approval of expulsion had remained pending for about 8 years. Even if the Cooperative Society had not furnished relevant and necessary details, the RCS was not prevented from taking requisite action in accordance with law. Given these facts, doctrine of deemed or inferred approval of expulsion of members by the RCS was applicable. The Division Bench had observed:-
6. The aforesaid decision was reversed by the Supreme Court and the expulsion of members was set aside observing that Rule 36 (3) of the Delhi Cooperative Societies Rules, 1973 did not postulate deemed or inferred approval. Unless there was specific approval by the RCS, the resolution passed by the Cooperative Society for expulsion remained inconsequential and unenforceable. Similar view as taken by another Division Bench of this Court in B.B. Chibber versus Anand Lok CGHS Limited and Others, 90 (2001) DLT 652, holding that deeming approval was not legally permissible in terms of Rule 36(3) of the Delhi Cooperative Society Rules, 1973. On the question of delay and latches on the part of the RCS, the Supreme Court observed that this aspect was made subject matter of W.P. (C) NO. 3325/1996, and would not affect rights of Rakesh Grover Group. On the question of demand from the expelled members, it was held as under:-
Thereafter, the Supreme Court held as under:-
A reading of paragraph 31 would show that the Supreme Court had after allowing the appeal and holding that the expulsion of Rakesh Grover Group was contrary to law and they continue as members, had proceeded to record a second or another reason and, therefore, had used the words “be that as it may” in the beginning of paragraph 31. The Supreme Court observed that the management of the Cooperative Society had been taken over by the Administrator and a number of flats were yet to be allotted. The appellants, i.e., Rakesh Grover Group had relied upon information received under the Right to Information Act, 2005 that 15 flats bearing Nos. 14, 23, 217, 324, 325, 327, 418, 421, 426, 513, 516, 619, 623 and 726 in category-„B‟ and Flat No. 737 in category-„A‟ were yet to be allotted. To meet the ends of justice, the Supreme Court had directed that the appellants therein, i.e., Rakesh Grover Group would be adjusted against the said un-allotted flats. The Cooperative Society would make a demand, if any, and the appellants were directed to make the payment with interest in accordance with law. The last paragraph specifically holds that the orders passed by the RCS and the Financial Commissioner that the Rakesh Grover Group continued to remain members of the Cooperative Society had been upheld and would bind.
7. Notwithstanding the aforesaid contest and proceedings, the newly enrolled members had participated in what was called the self draw-of-lots conducted on 20th October, 2002 and were allowed to occupy the aforesaid flats mentioned by the Supreme Court, after making payments to the Cooperative Society. Obviously, the Cooperative Society had felicitated these newly enrolled members. Approval from the RCS and the Delhi Development Authority were not taken. The occupation and possession was unauthorized and contrary to law.
8. These newly enrolled members then approached the Supreme Court by way of IA Nos. 6-7/2011, which were disposed of vide order dated 3rd March, 2011, recording as under:- “The applicants are permitted to move the Administrator/Registrar, Cooperative Societies, Delhi to vindicate their grievance and it is for them to substantiate and establish their rights. It is made clear that the applications shall be disposed of after hearing the parties as well as Society.”
9. Umesh Kumar Jain Group thereafter raised the issue before the RCS and thus started the second round of litigation. The submission was that the Rakesh Grover Group had obtained the order dated 18th October, 2010 from the Supreme Court by concealing facts and playing a fraud, for they had failed to state that the flats had been allotted in draw-of-lots held on 20th October, 2002 to the newly enrolled members, who were in physical occupation of the said flats. The RCS after considering all aspects passed the following order on 24th February, 2012:-
11. Sh. Vinod Kumar 12. Sh. Shyam Lal
13. Sh. Kashmiri Lal 14. Sh. Shiv Prasad
10. In view of the aforesaid order of the Hon‟ble Supreme Court, I direct the Society to readmit the above 14 persons as members of the Society. They should be issued share certificate by the Administrator of the Society immediately. With respect to the flats being occupied by the applicants, who had filed I.A. No.6-7 of 2011 in Civil Appeal No.5439 of 2003, these persons were admitted as members by the Society in utter violation of the previsions of law since there was no clear vacancies at that moment. Accordingly, their admission as members and consequently allotment of flats to them, cannot be recognized and same is therefore set aside.”
10. The order dealt with and rejects the contentions raised by the newly enrolled members i.e. Umesh Kumar Jain Group. Six newly enrolled members were in occupation of the flats and whereas 9 of them had sold their flats after taking possession on 20th October, 2002 and third persons were in occupation. The RCS held that the self draw-of-lots held on 20th October, 2002 and taking over of possession by the newly enrolled members was contrary to law and illegal. Reference was specifically made to the order of the RCS dated 26th August, 1997, which was upheld by the Supreme Court vide order dated 18th October, 2010.
11. Umesh Kumar Jain Group thereafter filed a revision petition before the Financial Commissioner, which has been dismissed by the impugned order dated 10th October, 2014. The Financial Commissioner has examined the contentions raised and after elaborate discussion and for cogent reasons has rejected the contention that the newly enrolled members had a better and superior right as they were in possession of the flats and had paid the towards cost of the flats. The Financial Commissioner held that the self draw-of-lots conducted on 20th October, 2002 was not in accordance with law and was never regularized by the RCS. The contention that the Supreme Court would not have passed the order dated 18th October, 2010, if they were told and informed that possession of flats had been given to the newly enrolled members was rejected observing that the contention was hypothetical. The RCS had rightly followed the directions given by the Supreme Court in their order dated 18th October, 2010. The operative portion of the order passed by the Financial Commissioner reads as follows:-
12. Petitioners also submitted that allotment by self draw has been regularized by the RCS vide an undated notification. I considered this averment also but petitioners did not submit any notification issued by the RCS by which scheme of self draw has been regularized. Petitioners also failed to submit the decision of the RCS on the application dated January 11, 2012 for the regularization of the self draw of flats.
13. I also considered the averment of administrator regarding deemed approval wherein it has been observed that although the Rule 36 (3) of the DCS Rules, 1973 states that the six months time to RCS on the decision of the application from society but it does not states anything about deemed approval as interpreted by the Administrator. Hence the proceedings or enrolling new members were void ab-initio. Without any vacancy, no new members could have been enrolled. Moreover, if there is a vacancy, the procedure to fill-up that vacancy is also defined in Rule 24 of Delhi Cooperative Societies Rules, 1973.
14. In view of the above facts and circumstances, I am of the considered view that since the expulsion proceedings in respect of respondents no.3-12 were not approved by the RCS and those vacancies were never created due to these expulsion proceedings, I do not find any infirmity in the order of the RCS. Accordingly, petitions are hereby dismissed.”
12. Some members of the Rakesh Grover Group had filed Contempt Petition No.8/2012 in Civil Appeal No. 9439/2003 before the Supreme Court. This contempt petition was dismissed vide order dated 12th March, 2012, recording as under:- “On going through our earlier order dated 18.10.2010 and the subsequent order passed by us in I.A. Nos.6-7 in Civil Appeal No.9439 of 2003 dated 04.03.2011 as well as order passed by the Registrar, Cooperative Societies dated 24.02.2012, we are satisfied that no further adjudication is required. Petitioner has not made out a case for contempt as claimed. The contempt petition is dismissed. ” The Supreme Court was informed that the RCS had passed an order dated 24th February, 2012. This order was challenged before the Financial Commissioner and had been affirmed by him vide order dated 10th October,
2014. In these circumstances, the contempt petition was dismissed.
13. Enrolment of Rakesh Grover Group (14 members) is valid and holds good. They being senior having been enrolled earlier would be entitled to allotment of flats, before allotment was made to those lower in the order of seniority. Umesh Jain Group, who were enrolled subsequently, albeit are in possession of flats would have to give up and vacate the flats. The principle „last to come, first to go‟ has to be applied. The subsequent members, who were granted membership for the reason that enrolment of Rakesh Grover Group was cancelled by the Cooperative Society, would stand below and cannot be allotted flats, unless flats are first allotted to the Rakesh Grover Group. This was the mandate of the order of the Supreme Court dated 18th October, 2010. Any deviation, would directly or indirectly result in nullifying and reversing the order of the Supreme Court. As per the Delhi Development Authority, the superior lessor, the flats mentioned in paragraph 31 of the order dated 18th October, 2010 have not been allotted to anyone.
14. We would not follow the precept that members who had not made payment towards construction should be disqualified and not be allotted flats, for the simple reason that in the present case the Cooperative Society had wrongly expelled and cancelled the enrolment of the Rakesh Grover Group. The said expulsion having been set aside by the Supreme Court, necessary consequences must follow. After all, it is the Cooperative Society who did not raise demands against the Rakesh Grover group towards cost of construction. First and foremost, Rakesh Grover Group (14 members) must be allotted their flats, before allotment is made to Umesh Jain Group. In case sufficient flats are not available, then the members who are last in the seniority list will have to surrender and forgo their right to allotment. This is the only just and fair. In any case, the order dated 18th October, 2010 passed by the Supreme Court must be implemented and complied.
15. Umesh Kumar Jain Group did approach the Supreme Court by way of I.A. Nos.6-7/ 2011, but as noticed above, the said applications were disposed of without recalling or reviewing the order dated 18th October,
2010. Permission was granted to Umesh Kumar Jain group to approach the RCS or the Administrator. It is obvious that neither the RCS nor the Administrator could have re-examined the issues and directions/findings of the Supreme Court. This was not the intent behind the order dated 3rd March,
2011. The intent behind the order dated 3rd March, 2011 passed by the Supreme Court was to enable the Umesh Kumar Jain Group to raise the issue before the Administrator and the RCS, who would examine whether any relief or benefit could be granted to them, without disturbing the rights of Rakesh Grover Group, affirmed in the order dated 18th October, 2010. The order of the Supreme Court dated 18th October, 2010 has attained finality and has become binding. It has to be only implemented. The only way it can be implemented is by allotting flats to the Rakesh Grover Group, otherwise the order dated 18th October, 2010 would become a mere piece of paper and a useless direction.
16. We, therefore, dispose of the writ petitions with the direction to the RCS to draw out a seniority list of members after consultation with the Administrator. The members lower in the seniority will have to surrender and vacate the flats in their occupation in favour of the Rakesh Grover Group (14 members). We are given to understand that the members lowest in the seniority list are in occupation of flats mentioned and recorded by the Supreme Court in paragraph 31 of their order dated 18th October, 2010. This is apparently correct and this is the reason why they have filed W.P. (C) No.8553/2014. They would have to vacate and handover the possession of the flats to Rakesh Grover Group (14 members).
17. The RCS will complete the aforesaid exercise within a period of two months from the date a copy this order is received. With the aforesaid directions, the writ petitions are disposed of. All pending applications are also disposed of. No costs.
SANJIV KHANNA, J. CHANDER SHEKHAR, J. JANUARY 31, 2017 NA/VKR