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Jagjivan Kanji Bhojani and anr. Vs. Mangal Co-operative Housing Society Ltd. and ors. - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtMumbai High Court
Decided On
Case NumberSpecial Civil Appl. No. 1833 of 1965
Judge
Reported inAIR1967Bom421; (1967)69BOMLR389; 1967MhLJ635
ActsMaharashtra Co-operative Societies Act, 1961 - Sections 91(1), 91(2), 95, 95(1) and 95(4); Constitution of India - Articles 226 and 227
AppellantJagjivan Kanji Bhojani and anr.
RespondentMangal Co-operative Housing Society Ltd. and ors.
Appellant AdvocateP.B. Sawant and ;K.Y. Mandlik, Advs.
Respondent AdvocateB.R. Naik and ;S.W.N. Naik, Advs., ;i/b., Little and Co.
Excerpt:
.....principle laid down in i.r. hingorani v. pravinohandra (1905) 67 bom. l.r. 306 will not apply to a dispute referred to in section 95(1) or section 95(4) of the maharashtra co-operative societies act, 1960 and, therefore, the proper authority can exercise power to make any interlocutory order mentioned therein even before the registrar decides that there is a dispute. it is not necessary that a registrar shall have first decided whether a dispute exists or not. - - (4) in view of the decision in hingorani's case the tribunal held that the entire proceedings which had preceded their order were bad and 'in these circumstances the only alternative for us is to set aside the order made by the nominee and remand the proceedings back to the district deputy registrar to decide first whether..........indicated that until this was done the registrar's nominee would not be competent to hear a dispute referred to him.(5) when the matter went back the petitioners prayed before the assistant registrar that pending the decision of the question whether a dispute exists which, according to the tribunal had been referred back to him, he should grant the petitioners an interim injunction restraining the society from parting with the flat by allotting it to any other person. it is patent that the alleged dispute between the parties was whether the petitioners should get the flat in question, which was lying vacant and has been lying vacant till to-day . if in the meantime the society were to allot the flat to any other person and if it was once occupied the reference before the assistant.....
Judgment:

Kotval, C.J.

(1) This petition arises out of an alleged dispute between the petitioners, who are the members of a Co-operative Society and the Co-operative Society known as Mangal Co-operative Housing Society Ltd., the first respondent before us. It appears that at one time the Society had entered into an agreement with the petitioners for the allotment to them of two flats Nos. 13 and 14 after the building which the Co-operative Society was constructing was completed. As a result of a change in the size of the flats there were dispute between the petitioner and the Society and those disputes came to be determined first by the Registrar's Nominee on 14th August, 1961 (Disputes Nos. 120 and 121 of 1959). The Registrar's Nominee had decided the disputes in favour of the petitioners. The Society then went in appeal to the Maharashtra State Co-operative Tribunal in Appeals Nos 216 and 127 of 1961 and the Tribunal reversed the decision of the Registrar's Nominee. A writ petition filed by the petitioners before this Court was dismissed summarily.

(2) Then on the 5th of April, 1963, the petitioners were informed that the Society had passed a Resolution on 31st of March, 1963, cancelling the allotment of the composite flat which had been allotted to the petitioners. A dispute thus arose and was referred to the Deputy Registrar. On the 18th May, 1963, the District Deputy Registrar appointed a Nominee, Mr. G. B. Terdalkar, to try the dispute. Mr. Terdalkar, after he had passed some interlocutory orders was appointed to another post and therefore, could not give his decision. On 28th August, 1964, the District Deputy Registrar, therefore, referred the alleged dispute for the decision by his Nominee. Mr. S. R. Kaprekar. There were protracted proceedings arising out of an interim order passed by Mr. Kaprekar, and ultimately the matter came before the Maharashtra State Co-operative Tribunal.

(3) By that date the decision of this Court in I. R. Hingorani v. Pravinchandra Kantilal Shah. : (1965)67BOMLR306 , had been pronounced. That decision tool the view that before an alleged dispute is referred to the Registrar's Nominee it was incumbent upon the Registrar to issue notice to both the parties and after giving them an opportunity of being heard on the question whether a dispute exists to decide that question himself. It is only after the Registrar had heard the parties or given them an opportunity of being heard that he can satisfy himself that a dispute exists within the meaning of Section 91 of the Maharashtra Co-operative Societies Act, 1960. It is that decision of the Registrar which becomes final under Section 91(2) of the Act.

(4) In view of the decision in Hingorani's case the Tribunal held that the entire proceedings which had preceded their order were bad and 'In these circumstances the only alternative for us is to set aside the order made by the Nominee and remand the proceedings back to the District Deputy Registrar to decide first whether there is a dispute falling within the meaning of Section 91(1) after following the procedure indicated in the ruling of the High Court'. The Tribunal indicated that until this was done the Registrar's Nominee would not be competent to hear a dispute referred to him.

(5) When the matter went back the petitioners prayed before the Assistant Registrar that pending the decision of the question whether a dispute exists which, according to the Tribunal had been referred back to him, he should grant the petitioners an interim injunction restraining the Society from parting with the flat by allotting it to any other person. It is patent that the alleged dispute between the parties was whether the petitioners should get the flat in question, which was lying vacant and has been lying vacant till to-day . If in the meantime the Society were to allot the flat to any other person and if it was once occupied the reference before the Assistant Registrar would be rendered practically infructuous. The Assistant Registrar, therefore, was moved to grant an interim order but the Assistant Registrar felt bound by the decision of the Triobunal. He, therefore, held that he should not grant the interim order asked for by the petitioners against the Society. This order was passed on 14th October, 1965. The petitioners have moved the present application against the order of the Assistant Registrar refusing to grant the interim order. They have also filed this petition against the order of the Maharashtra State Co-operative Tribunal, dated 11th August 1965, holding that until the District Deputy Registrar decides first whether there is a dispute falling within the ambit of Section 91(1) of the Act all the proceedings which were hitherto taken before him were bad.

(6) Now, so far as the order, dated 11th August, 1965, is concerned, we have no doubt that the order was a correct order for it only follows the decision of the Division Bench given on 1st March, 1965, but it is the further order that came to be passed by the Assistant Registrar after the decision of the Tribunal was given which in our opinion is unsupportable. When the matter went back to the Assistant Registrar he took the view that since the Tribunal had said that all the proceedings, were had because the Registrar or the District Deputy Registrar had not decided initially whether a dispute exists within the meaning of Section 91(1) of the Act, therefore, he was also incompetent to decide or grant interlocutory relief which the petitioners had prayed for pending the decision of the question whether a dispute exists or not. In that view we have no doubt that the Assistant Registrar was wrong.

(7) In Hingorani's case the Division Bench was not concerned with any interlocutory order before it nor were they considering the applicability of Section 95 of the Act. The question, however, is whether the principle laid down in that decision would equally apply to an application made for interim relief under Section 95.

(8) Now Section 95(4) in terms provides:

'The Registrar or his Nominee or board of Nominee or the person authorised under Section 88 as the case may be, may in order to prevent the ends of justice being defeated make such interlocutory orders pending the decision in a dispute referred to in Sub-section (1) as may appear to be just and convenient.' The first point we would make so far as this sub-section is concerned is that it was expressly added by way of an amendment by the Maharashtra Co-operative Societies Act of 1963 and prior to it there was no such provision governing the grant of relief by passing interlocutory orders pending the decision although in Section 95(1) there was an express provision for passing interlocutory orders of conditional attachment before passing orders upon any dispute on the merits. It is clear, therefore, that in addition to the interlocutory relief which the Registrar could grant under sub section (1) by way of attachment before judgment sub-section (4) conferred additional powers upon him to pass such interlocutory orders pending a decision in a dispute such as is referred to in sub-section 95(4) as may appear to be just and convenient. The intention of the legislation was to enlarge the powers of the Registrar to grant interim relief pending the decision of the dispute referred to him. The second point which we would emphasize is that under sub-section (4) a power has been conferred 'in order to prevent the ends of justice being defeated'. In other words the whole object of the incorporation of sub-section (4) of Section 95 was that pending the dispute referred to the Registrar and before it is decided the parties should not take advantage of each other by so altering the situation that the decision of the dispute would be virtually rendered infructuous.

(9) That is precisely the position which has arisen in the present case, viz that the petitioners claim that they are entitled to be allotted the flat in question by the respondent Society. If in the meanwhile the society were to allot the flat the very purpose of the reference would be defeated. There was an agreement and the moneys against the agreement have, according to the petitioners, been deposited with the Co-operative Society and the Society has all these years been holding on to that money. For reasons of its own t he Society first altered the allotment to the petitioners from two flats to one composite flat and later on cancelled the allotment altogether because as stated in the Resolution the petitioners did not take possession for almost 15 months. The latter statement is disputed by the petitioners. The full merits of this controversy is doubtless not clear; but it is clear beyond doubt that if the dispute between the parties is to have any meaning at all, the flat must remain vacant until the dispute is decided so that it can be allotted to the petitioners, if they succeed. That can only be ordered by passing an immediate interlocutory order in the ends of justice.

(10) It is in this context that we have to see whether sub-section (4) of Section 95 can apply before the Registrar decides whether a dispute exists or whether Section 95 (4) would apply only if he holds first that a dispute exists. In other words that question is whether the principle of the decision in Hingorani's case would also govern sub-section (4) of s. 95.

(11) Now, we have already indicated that so far as Hingorani's case is concerned that was not a case of an interlocutory order at all nor was the Court concerned with Section 95(4) in that case Counsel for the respondents pointed out that even in sub-section (4) of Section 95 the words used are:

'. . . . . . make such interlocutory orders pending the decision in a dispute referred to in sub-section (1). . . . .'

The word used is 'dispute' and, therefore, it has been urged that there must first be a dispute and unless that question is first decided the power to grant an interlocutory order would not arise.

(12) In order to examine this argument one must turn to Section 91 which deals with the subject of disputes. Section 91(1) prescribes that not with standing anything contained in any other law and dispute falling within the categories stated therein shall be referred by any of the parties to th dispute to the Registrar provided the parties occupy a certain position described in clauses (a) to (e) of sub-section (1). Sub-section (2) thereof says:

'(2) When any question arises whether for the purposes of the foregoing sub-section a matter referred to for decision is a dispute or not, the question shall be considered by the Registrar, whose decision shall be final.'

The word 'to' in this sub-section appears somewhat redundant but for the purposes of the point before us we need not have regard to that defect. Sub-section (2) thus makes it clear that the question whether a dispute exists or not in any matter referred to the Registrar must be decided by the Registrar himself. Now relying upon these provisions the Division Bench held in Hingorani's case that it is for the Registrar first of all to issue notice to both the parties and given them an opportunity of being heard on the question whether a dispute exists and it is only after the Registrar has done so that he can decide or satisfy himself whether a dispute within the meaning of Section 91(1) of the Act exists. Since the word used in sub-section (4) of Section 95 is also 'a dispute' it is argued that the principle of Hingorani's case would be attracted to any application for an interlocutory order pending the decision of a dispute, under sub-section (4) of Section 95.

(13) The argument is undoubtedly plausible for the same word has been used in sub-section (4) of Section 95 as in Section 91.

(14) The word 'dispute' is not defined in the Act but if one turns to Section 91 itself, Section 95(1) and Section 105(j) one finds that in the Act the word 'dispute' has been used not only to cover a dispute which the Registrar has determined is a dispute but also a dispute which the Registrar has not so determined that is to say, which is merely in the initial stage of being referred to the Registrar. Section 91(1) itself indicates this, Its opening words are:-

'Notwithstanding anything contained in any other law for the time being in force, any dispute touching the constitution...... or business of a society shall be referred by any of the parties to the dispute . . . . to the Registrar.' Now, here the word 'dispute' means nothing more than what the parties think is a dispute or in other words the alleged dispute between the parties. By contrast if one turns to the provisions of Section 93. Sub-section (2), it provides 'Where any dispute is referred under the foregoing sub-section, fot decision to the Registrar's nominee the Registrar may at any time for reasons to be recorded in writing withdraw such dispute from his nomine . . . . and may decide the dispute himself,' Now, so far as this sub-section is concerned, having regard to the principles of Higorani's case a dispute which can go to the Nominee for decision can only be a dispute which the Registrar has previously determined is a dispute within the meaning of Section 91(1) and it is such a dispute which the Registrar has power to withdraw. Here the word dispute is used in the second sense, viz., a dispute which the Registrar has already pronounced upon as being a dispute. This is further clear if one considers the provisions of Section 95(1) which commences with the words: 'Where a dispute has been referred to the Registrar' and the Registrar is satisfied on inquiry or otherwise that a party to such dispute with intent to defeat, delay or obstruct the execution of any award or the carrying out of any order that may be made, is about to dispose of the whole or any part of his property or remove it from the jurisdiction of the Registrar to call upon him to furnish adequate security or direct conditional attachment of the said property. Here the words dispute is used in both senses it is used in the sense of an alleged dispute or controversy between the parties which the parties are entitled to refer to the Registrar. It is also used in the sense of a dispute which the Registrar has already determined is a dispute.

(15) We may here also point out that we have so far only discussed the meaning of the word 'dispute' occurring in Section 95(4) isolated from its context but considering the context the above construction appears the more reasonable. The composite expression used in Section 95(4) is 'dispute referred to in sub-section (1)'. We have already shown that in section 95(1) the word 'dispute' can carry the meaning of 'the alleged dispute' or 'what the parties think is a dispute' or in other words 'a dispute which the Registrar has not yet determined is a dispute'. It is that dispute which is contemplated in Section 95(4).

(16) It is also of some significance that sub-section (4) of Section 95 deals with the same subject matter with which Section 95(1) is concerned, viz. The power of the Registrar to grant interlocutory relief or pass interlocutory orders pending the decision in a dispute referred to him.

(17) A reference before the Registrar cannot arise by any order of the Registrar suo motu. It is only the power of the parties to the Registrar. This is clear from the opining words of sub-section (1) of Section 91 which says 'notwithstanding anything contained in any other law for the time being in force any dispute touching the constitution or business of a society shall be referred by any of the parties to the dispute to the Registrar.' The right of reference is that of the parties to the dispute provided they satisfy the conditions laid down in clauses (a) to (e) of sub-section (1). When, therefore, sub-section (4) of Section 95 speaks of interlocutory orders pending the decision in a dispute referred to in sub-section (1) and sub-section (1) speaks of a dispute which has been referred to the Registrar, that dispute which the parties allege exists between them seems to be intended to be referred to and not only a dispute which the Registrar has already pronounced upon as being a dispute.

(18) We hold therefore that the principle laid down in Hingorani's case will not apply to a dispute referred to in sub-section (1) of Section 95 or sub-section (4) of Section 95 and therefore the proper authority under Section 95 can exercise power to make any interlocutory orders mentioned therein even before the Registrar decides that there is a dispute. It si not necessary that a Registrar shall have first decided whether a dispute exists or not.

(19) In that view the order passed by the Assistant Registrar, dated 14th October, 1965, declining to make or pass an interim order as prayed for by the petitioners before him was incorrect and must be set aside. In our view, he had full power to pass an order under Section 95(4) even before the Registrar decided whether a dispute exists or not. To that extent therefore, the petition before us must be allowed.

(20) On behalf of the petitioner it has been pointed out to us that upon the view which we take the matter must now go back to the Assistant Registrar for passing appropriate orders but it may take sometime before the papers can go back to the Assistant Registrar and the further question is what is to happen in the meanwhile. The very purpose of the petitoners' application pending before the Assistant Registrar will be defeated if in the meanwhile the respondent society were to allot the flat in dispute between the parties to another member or any other person and it is necessary therefore to safeguard the petitioners until the Assistant Registrar takes a decision upon the application of the petitioners for a interlocutory order in their favour under Section 95(4).

(21) We therefore pass an order prohibiting the respondent -society from parting with the possession of the flat in dispute to any one until the application for interim relief before the Assistant Registrar is decided by him. Respondent No. 1 shall pay the costs of the petitioners. Respondent No. 2 shall bear his own costs.

(22) Order accordingly.


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