(Prayer: These writ petitions are filed under Articles 226 and 227 of the Constitution of India, praying to quash the impugned order dated 1-2-2016 on I.A.No.1 passed by Respondent No.1 produced as Annexure-A and etc.)
1. The petitioners are aggrieved by the order dated 1-2-2016, passed by the learned Additional Registrar of Co-operative Societies, whereby the learned Additional Registrar has vacated the stay granted by him to the petitioners. The petitioners are equally aggrieved by the order dated 10-6-2016, passed by the Karnataka Appellate Tribunal, Bengaluru, whereby the learned Tribunal has dismissed the petitioners' revision petition, and has confirmed the order dated 1-2-2016 passed by the learned Additional Registrar.
2. The brief facts of the case are that the petitioners claim to be members of the Karnataka State Judicial Department Multipurpose Co-operative Society. According to them, this Society was formed in 1938. The Society has permanent office in the premises of the High Court of Karnataka. According to the bye-laws, the members of the Society must be either employees of the High Court, or Karnataka State Judicial Department, or of the Advocate General's Office. The aim and object of the Society is to grant personal loan up to Rs.1,25,000/-, and to form residential layout for the needy members of the Society.
3. The petitioners further claim that the Society not only inducted associate members, but also started giving preference to them over the regular members while allotting sites in the layout. Although in order to discover the malfunction of the Society, the petitioners had sought certain documents, but the documents were never given to them by the Society. The apprehension of the petitioners was further strengthened by circular dated 1-11-2015, whereby the Society proposed to commence the III Stage of residential layout. According to the said circular, the members of the Society were required to pay a huge amount for being allotted house sites in the III Stage. Since the amount demanded from the members were beyond their financial capacities, and since the petitioners were convinced that the Society was not working in their interest, but was working in the interest of the associate members, they raised a dispute before the learned Additional Registrar of the Co-operative Societies. Along with their dispute, they filed an application for interim stay. Initially, on 15-12-2015, respondent No.1, the learned Additional Registrar, directed the Society to maintain status-quo till 18-1-2016. The Society submitted its objections. The petitioners submitted an application for extension of the interim order. However, by order dated 1-2-2016, the learned Additional Registrar dismissed the application for extension of interim order, and vacated the stay granted by him.
4. Since the petitioners were aggrieved by the said order, they filed a revision petition before the learned Tribunal. However, by order dated 10-6-2016, the learned Tribunal has dismissed the revision petition, and has confirmed the order dated 1-2-2016. Hence, these petitions before this Court.
5. Mr. H. Pavana Chandra Shetty, the learned counsel for the petitioners, has vehemently contended that certain irregularities have been committed by the Society at the expense of the petitioners members.
Secondly, merely because the Society has submitted an affidavit before the learned Tribunal that it would continue to allot the land sites to the regular members, and would not allot a land site to the associate members at the cost of the members, the learned Tribunal could not have relied upon the said affidavit.
Thirdly, the circular dated 1-11-2015 prescribes that the site amount shall be paid by the members in five installments; the five installments range from Rs.1,00,000/- to Rs.5,04,000/-. But the said amount cannot be afford by the members as they are merely employees of the High Court, or belonging to the State Judicial Department, or employees of the Advocate General's Office. Thus, the large amount demanded by the Society cannot be paid by the members. Hence, the circular is a clever ploy for benefiting the associate members at the expense of the regular members.
Fourthly, if the respondent - Society is permitted to create a third party right in favour of the members, it would lead to multiplicity of allegation. Therefore, the learned Additional Registrar is not justified in vacating the stay order initially granted by him on 15-12-2015. Further, the learned Tribunal is not justified in dismissing the revision petition. Hence, both the impugned orders deserve to be set aside by this Court.
6. On the other hand, Mr. Jayakumar S. Patil, the learned Senior counsel, submits that although initially according to the bye-laws, the associate members were not allowed to induct, but by subsequent amendment of the bye-laws, the Society is permitted to induct the associate members. It is only on the basis of the amended bye-laws, the associate members have been inducted.
Secondly, although the petitioners claim that irregularities are being committed by the Society, yet no evidence has been submitted by the petitioners.
Thirdly, due to the phenomenal rise in the real estate prices, the Society is justified in asking for installments to be paid by the members of the Society. Even if the installments asked for are big, even then, it would not lead to a conclusion that an irregularity has been committed by the Society.
Fourthly, the learned Tribunal has noted the fact that the petitioners have neither applied for allotment of sites, nor submitted any evidence to establish their allegations that the Society is committing irregularities. Since the petitioners have failed to establish a prima-facie case, the learned Additional Registrar was justified in not extending the stay order dated 15-12-2015. For the same reason, the learned Tribunal is also justified in dismissing the revision petition. Hence, the learned Senior counsel has supported the impugned orders.
7. Heard the learned counsel for the parties, and perused the impugned orders.
8. Initially, the bye-laws of the Society permitted only the Officers and the Officials of the High Court of Karnataka, the Karnataka State Judicial Department, and the Advocate General's Office for becoming members of the Society. However, subsequently, the bye-laws were duly amended, and the amended was approved by the Registrar of the Co-operative Societies. According to the amendment, the Society was permitted to induct associate members into the Society. Therefore, the induction of the associate members cannot be questioned by the petitioners, especially, when the petitioners have never challenged the amendment of the bye-laws.
9. According to Section 9 of the Karnataka Co-operative Societies Act, 1959, a Co-operative Society is permitted to carryon its business. Therefore, the Society cannot be prevented from carrying out its business with its associate members.
10. Moreover, neither before the learned Additional Registrar, nor before the learned Tribunal, nor before this Court, the petitioners have produced any evidence to show that any irregularities have been committed by the Society. Merely because the Society has issued the circular dated 1-11-2015, whereby the Society has given an opportunity to its members to pay the full amount of a land site in five installments, merely because the amount to be paid ranges from Rs.1,00,000/- to Rs.5,04,000/-, only on this basis, an inference cannot be drawn that irregularities are being committed by the Society. Neither the learned Additional Registrar, nor the learned Tribunal, nor this Court is of oblivious of the fact that due to the demographic pressure on Bengaluru, the prices of real estate have phenomenally escalated. Therefore, the contention raised by the petitioners that the circular dated 1-11-2015 is a clever ploy for ignoring the interest of the regular members, and for selling land sites to the associate members, the said contention cannot be accepted by this Court.
11. Once the petitioners have failed to establish their allegations of irregularity, obviously, the petitioners have not succeeded in making a prima-facie case. Thus, the petitioners have failed to establish the first criteria of granting a stay order. Moreover, since the Society is continuing to deal with the associate members as permitted by the bye-laws, the petitioners are not in a position to claim balance of convenience in their favour. Even if any irregularities, or illegalities were to be committed by the Society, and if such irregularities, or illegalities were established by the petitioners, before the learned Additional Registrar, the same can be set aside by the learned Additional Registrar at the time of final hearing of the dispute. Hence, no irreparable loss would be caused to the petitioners, if the respondent - Society were not restrained by a stay order. Considering the fact that none of the three criterion is in favour of the petitioners, the learned Additional Registrar is justified in not extending the stay order dated 15-12-2015, and the learned Tribunal is justified in confirming the order passed by the learned Additional Registrar.
12. For the reasons stated above, this Court does not find any merit in these writ petitions. They are, hereby, dismissed.
However, it is clarified that any observation made by this Court with regard to merits of the cases shall not influence the final decision of the learned Additional Registrar with regard to the dispute that has been raised before him. The learned Additional Registrar is expected to pass his order on the evidence produced by both the sides. For, any observation in this regard is prima-facie in nature, and does not tantamount to a judicial finding.