Skip to content


Daulat Ram Mehnidratta Vs. Lt. Governor of Delhi and ors. - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtDelhi High Court
Decided On
Case NumberCivil Writ Appeal No. 390 of 1980
Judge
Reported inAIR1982Delhi470; 1983(4)DRJ66; 1983RLR116
ActsDelhi Cooperative Societies Rules, 1973 - Rule 25
AppellantDaulat Ram Mehnidratta
RespondentLt. Governor of Delhi and ors.
Advocates: Ramesh Chandra,; Y.K. Sabharwal and; M.M. Sudan, Advs
Cases ReferredKailash Chandra v. Rajasthan University. In
Excerpt:
delhi coop. societies rules, 1973 - rule 25 rule 25(2) is valid. it is not retrospective. a member becoming disqualified under sub-rule (1) ceases to be a member when this disqualification occurs i.e. from april 2, 1973 when the 1973 rules came into force and not from any earlier date. - - thelessee shall sub-lease within two years from the date of execution of the lease and on such premium and yearly rent as may be fixed by the lesser, one residential plot to each of its members who or whose wife/husband or any of his/her dependent relatives including unmarried children does not own, in full or in part, on free-hold or lease held basil, any residential plot or house in the urban areas of delhi, new delhi or delhi cantonement, and who may be approved by the chief commissioner'.(4) the.....sachar, j.(1) this full bench has been constituted to resolve the conflict between two division bench judgments of this court namely prof. balraj madhok & others v. registrar of co-operative societies & others, i.l.r. 1974 (2) delhi 684 and s.b. lall& another v. registrar of co-operative societies new delhi & another, i.l.r. 1977 (2) delhi 164. the question that calls for determination is to the exact impact and the effect of rule 25(1 )(c) read with rule 25(2) of the delhi co-operative societies rules, 1973 (hereinafter to be called as the rules).(2) the petitioner applied for and became a member of dera lsmail khan cooperative house building society in 1952. in 1954 the petitioner purchased a house at b-17/a-9, krishan nagar, delhi. in 1955 the petitioner purchased 4 plots from m/s......
Judgment:

Sachar, J.

(1) This full bench has been constituted to resolve the conflict between two division bench judgments of this court namely Prof. Balraj Madhok & Others v. Registrar of Co-operative Societies & others, I.L.R. 1974 (2) Delhi 684 and S.B. Lall& another v. Registrar of Co-operative Societies New Delhi & another, I.L.R. 1977 (2) Delhi 164. The question that calls for determination is to the exact impact and the effect of Rule 25(1 )(c) read with Rule 25(2) of the Delhi Co-operative Societies Rules, 1973 (hereinafter to be called as the Rules).

(2) The petitioner applied for and became a member of Dera lsmail Khan Cooperative House Building Society in 1952. In 1954 the petitioner purchased a house at B-17/A-9, Krishan Nagar, Delhi. In 1955 the petitioner purchased 4 plots from M/s. Nirmal Finance India Private Ltd. This land along with certain other lands was acquired and a Preet Nagar Cooperative House Building Society was formed and the petitioner became a member of the said Society in 1958. The Preet Nagar Cooperative House Building Society was accepted by the Housing Commissioner, Delhi Administration for the purpose of allotment of plots on concessional basis on certainn condi- tions mentioned in the lease deed. One of the conditions laid down by the Housing Commissioner by his letter of 5.u.1966 laid down that it was proposed to allot land to the society subject to certain conditions ; one of them being.....................(ii) 'any person who already owns a house/residential flat in his own name or in the name of his wife or dependent children will not be allotted any land as a member of this society.'

(3) It may be mentioned that at the time when the petitioner became a member of the Preet Nagar Society he was already a member of the Dera Ismail Khan Cooperative House Building Society. It also is a common case that at that time there was no restriction on a person becoming a member of more than one house building cooperative societies. The Preet Nagar Society in pursuance of the advice by the Delhi Administration adopted model bye-laws by its resolution of 4-9-1966 agreeing to comply with the condition which was a condition precedent for the allotment of land. Bye-law 5(i)(f) & (h) read as under :- (f) he is not a member of any other House Building Society. (h) He or his wife (she or her husband in case of a woman) or any of his/her dependants does not own a dwelling house or aplot for building a house in Delhi/New Delhi/Delhi Cantt. But this would not effect membership enrolled under Clause 5(1) above, who would be entitled to remain member of the Society for the purpose of getting compensation through the Society of his land having been acquired. The condition for allotment imposed by the Housing Commissioner vide letter dated 5.8.1966 was duly communicated to the members including the petitioner. By his letter of 10.11.1976, the petitioner intimated that he has understood the three conditions imposed by Delhi Administration for allotment of land. Even when the allotment was made to him on 16.8.1976 it was made clear that the allotment made is subject to the affidavit being submitted. The petitioner was thereafter asked to furnish an affidavit in compliance with the undertaking given by the Society to the Delhi Administration for the allotment of land in accordance with the conditions of membership under the New Model Bye Laws and as per undertaking of the petitioner in his letter of 10-11-1976. Thereafter the Delhi Administration leased to the Society by lease deed of 11.4.1977 the land on certain conditions mentioned therein. One of the conditions of the lease deed dated 11.4.1977 and the one relevant to the present case is clause 5(a) which reads as under:

'THElessee shall sub-lease within two years from the date of execution of the lease and on such premium and yearly rent as may be fixed by the Lesser, one residential plot to each of its members who or whose wife/husband or any of his/her dependent relatives including unmarried children does not own, in full or in part, on free-hold or lease held basil, any residential plot or house in the urban areas of Delhi, New Delhi or Delhi Cantonement, and who may be approved by the Chief Commissioner'.

(4) The petitioner had been regularly asked to the Society to give the requisite affidavit but he consistently failed to submit one. The society having informed the Registrar about the non-submission of the affidavit by the petitioner he was asked by the Registrar vide his letter of 26 .11.1978 to submit the requisite affidavit and also informing him that failing which he will not be considered for the allotment of plot. As the petitioner was holding property No. 17/8-9 Krishan Nagar, he naturally found himself unable to give the necessary affidavit. The petitioner as informed by the Society on 4.2.1979 that in view of his holding the property in Delhi and his non-submission of affidavit his membership stood cancelled. Thereafter the petitioner filed a writ petition in this court on which a direction was given to the Registrar to decide the matter afresh.

(5) Plea taken by the petitioner before the Registrar was that the petitioner bought the house in Krishan Nagar when he was not a member of the Preet Nagar Cooperative Society. It was also pleaded that when the petitioner became a member of the Society there was no restriction on a person to become a member if he already owned a house. He, thereforee, prayed that he was entitled to allotment of a plot in Preet Nagar Society. The further plea was that Rule 25(l)(c) read with Rule 25(2) could not take away his membership which he had obtained before the coming into force of 1973 Rules. He had also put in a plea that if he could not be allotted a plot the same may be transferred to his son. All these pleas have been rejected by the petitioner by the Registrar by his impugned order of 23.11.1980. The writ petition challenging the above said impugned order came before us in Division Bench when noticing the conflict between the two division bench judgments of this court the matter was referred to the Full Bench and it has now come before us.

(6) Two questions were urged by Mr. Ramesh Chandra the learned counsel for the petitioner. The first was that as the petitioner was entitled in law and did become a member validly of Preet Nagar Society he could not be deprived the right to be allowed the land which the Delhi Administration had given on lease to the said Society for being given on further sublease to the members. In our view this stand is totally unacceptable. Apart from the question whether the petitioner can continue to remain a member of the Preet Nagar Society the question of allotment of land which the society has got from Delhi Administration to the petitioner has to be judged solely by the conditions on which the society has been given that land by the Administration. In the lease dated 11.4.1977 in favor of the society it has been clearly provided by clause 5(a) that the lessee shall sub-lease one residential plot to each of its members who or whose wife or husband......... does not own in full or in part on free hold or lease hold basis any residential plot or house in Delhi. This being the condition of lease deed it is apparent that no sub-lease could be given in favor of the petitioner even if he was to remain a member of the society. The reason is that if the Lesser has pres- cribed a condition subject to which alone a further sub-lease can be created the lessee society could not sub-lease it in violation of the terms laid down by the Lesser, Irrespective, thereforee, of the claim of the petitioner to remain a member of the society (which we shall deal later on) the claimed right of the petitioner to be allotted a plot as a sub-lessee of the society must fail on the short ground that unices he could comply wilh the conditions laid down by the Lesser he would not be allotted the plot. Petitioner admittedly gave no affidavit as indeed he could not because he did own a house in his own name. In that view there was no other alternative for the society but to refuse io allot any plot to the petitioner. The petitioner's effort to have the allotment transferred to his son's name was equally of no avail. The reason is that unless the petitioner could first establish or lay a claim/right io be allotted a plot he could obviously not exercise any right with regard to the non-existing allotment. The petitioner cannot ask for transfer of better title than he himself possesses. He cannot convey a better title than possessed by him. As the petitioner has been found disentitled to the allotment of a plot it is exio- matic that he could not logically ask that the plot be instead allotted to his son as his nominee. The petitioner being without any claim to the allotment of land was rightly refused by the Registiar to have any plot allotted to his son as his nominee. There is another disentitling' the petitioners to any relief. The petitioner had agreed to the condition laid down by the Administration as per 5.8.1966 letter that no allotment of plot will be given to any person who owns a residential plot in his name. It is answer by the petitioner to say that as he already owned a house this decision of Delhi Administration in 1966 when executing a perpetual lease cannot take away his right of allotment of plot. The allotting authority i.e. the Lesser, Delhi Adminis- tiation was competent to make a decision to allot land subject certain conditions) one of them being that any person who owns a house in Delhi will not be eligible for being allotted at any land as a member of the society. There is no law which compelled Delhi Administration not to impose such a condition. As a matter fact such a condition serves the pre-eminent purpose of equitable distribution so as to enable the need of housing to be satisfied for as large a number of persons as possible. This condition prevented the richer sections to concentrate the housing plots amongst themselves. The hunger for housing plots being in millions the only rational manner is to make allotment to those who are without any land/house. Such a condition is pre-eminently just. The petitioner cannot in law avoid such condition ; his insistence, nevertheless on being allotted a plot is without substance.

(7) Mr. Ramesh then argued that there was no reason (even if the petitioner was not to be allotted a plot of land) for the Registrar to hold that he had ceased io be a member of the society. The argument is that even if he cannot be allotted the land because of the prohibition laid down by Delhi Administiation in the perpetual lease he has not ceased to be a member of a society i.e. Preet Nagar Cooperative House Building Society of which he validly became a member in 1958 and no subsequent subordinate legislation. like Rules of 1973 can take away his membership retrospectively. Before we examine 1973 rules, we may say at once that in our view the petitioner could not have remained a member of Preet Nagar Society after September 1966, when the new Bye-laws were adopted by the Society. It is apparent that membership of a society can only be in compliance with the bye-laws. When bye-laws were amended in 1966 clause 5(1)(h) clearly stated that any person shall be eligible to be a member of the society provided he or his wife did not own a dwelling house in Delhi. There was no exemption made in the case of existing members prior to the amended bye-laws. The only exemption made was by clause 6 which provided that original members are exempted from the provisions of Bye-laws 5(l)(b) which evidently referred to the written application for membership being approved by a majority of the Managing Committee This provision was necessary because the original members being those who asked for registration of the society obviously cannot have their written application for membership approved by the Managing Committee. The bye-laws govern the relationship between the member and the society. As the bye-laws were amended in the present case in 1966 and they provide as to who shall be eligible to become a member it must necessarily also include all those who wanted to be members or wanted to continue as members after the amendment of the bye-laws. There is no separate provisions for the old members to continue automatically even when they fell foul of the amended Bye-Laws. In such a situation the petitioner would have to comply with the requirement of amended Bye-Laws which mide eligibility turn a member dependant upon a person not owning a dwelling house in Delhi. Position would be different if there was no amendment of the Bye- Laws. But once the Bye-Laws are amended the petitioner would have ceased to be a member from the date of amended bye-laws. Section 98(b) which saves the right privileges or obligations accrued or incurred under the Act repealed namely-1912 Act, cannot avail the petitioner because he is not claiming any right which he had under the old Act. His right under the old Acts were governed by the by-laws of the Society which no doubt permitted him to become a member in 1958 but when they were amended in 1966 the petitioner became ineligible to remain a member and hence ceased to be a member. Now let us examine the implication of Delhi Cooperative Societies Act, 1972 and the Rules framed under it being Delhi Cooperative Societies Rules 1973. Prior to the coming into force of Delhi Cooperative Societies Act 1972 (hereinafter to be called 1972 Act) Bombay Cooperative Societies Act 1925 had been extended to Delhi and was in force. There was no provision under the Bombay Cooperative Societies Act that person cannot be a member of more than one Cooperative Societies or that he owns a residential house or a plot of land in Delhi. Section 92 of 1972 Act while repealing the Bombay Cooperative Societies Act provided that every Society registered under the Said Act shall be deemed to be registered under the corresponding provisions under the 1972 Act and its bye-laws shall so far as the same are not inconsistent with the express provisions of the Act continue, to be in force until altered or rescinded. Section 97 provided for the framing of the Rules by the Lt. Governor. Section 97(2)(v) read as under :

'THEconditions to be complied with by persons applying for admission or admitted as members for the election and admission of members, and for the payment to be made and the interest to be acquired before the exercise of the right of membership'.

(8) Section 20 lays down the persons who could be admitted as members of the Cooperative Societies. Sub-section (2) of Section 20 empowered the Lt. Governor having regard to the fact that the interest of any person would conflict or likely to conflict with the objects of the Society, ............... ............... declares that any person or class of persons engaged in or carrying on any business or employment shall be disqualified from being admitted or for continuing as members or shall be eligible for membership only to a limited extent of any society or class of societies. Rule 24 provides conditions to be complied for admission to membership which require a form to be filled, and application to be approved by a Committee, and fulfillment of other conditions laid in the Act and Rules. Rules 25 provides for disqualification for membership, Rule 25(1)(c) and Rule 25(2) respectively provide that no person shall be eligible for admission as a member of Co-operative Society, if, in the case of membership of a housing society ; (i) he owns a residential house or a plot of land for the construction of a residential house in any of the approved or un-approved colonies or other localities in the Union Teritory of Delhi, in his own name or in the name of his spouse or any of his dependent children, on lease hold or free hold basis ; (ii) he deals in purchase or sale of immovable property either as principal or as agent in the Union Territory of Delhi ; or (iii) he or his spouse or any of his dependent children is a member of any other housing society except otherwise permitted by the Registrar. 25(2) : Notwithstanding anything contained in the Rules or the bye-laws of the co-operative Society, if a member becomes or has already become, subject to any disqualifications specified in subrule (1), he shall be deemed to have ceased to be a member from the date when the disqualifications were incurred. Now it is apparent that after 1973 Rules have come into force a person like petitioner could not be eligible for admission as a member it he owns a residential house. Thus if the petitioner was to apply after the date of 1973 Rules to become a member of the Preet Nagar Co-operative Society he would be ineligible because he owned a house in Krishan Nagar. So far there is no controversy. The problem however, arises because Mr. Ramesh urges that simply because the petitioner owns a house in Krishan Nagar and may not be eligible to become a member of Preet Nagar Society if he was to apply now does not mean that he should be deemed to have ceased to be a member by virtue of 1973 Rules when the petitioner admittedly was not under any disqualificatian in 1957 when he become a member of Preet Nagar Society. The argument proceeds that the effect of Rules 25(1)(c) and Rule 25(2) is that it operates retrospectively and takes away a vested right and is thereforee, ultra virus and relies on I.L.R. 1977 (2) Delhi 164 S.B. Lall & another v. Registrar of Co-operative Societies, New Delhi and another. The respondents however, relied od I.L.R. 1974 (2) Delhi 684 Balraj Madhok & others v. Registrar of Cooperative Societies and others, for upholding the validity of a rule even on the finding that it is retrospective. We must now, thereforee, analyze these two authorities which necessitated the reference. In S.B. Lall's case (supra) a division bench comprising of Tatachari, Cj and Deshpande, J. had occasion examine the virus of Rule 25(1)(c)(2). In that case the bench referred to the adoption of Bye-Laws 5(1)(c) which provided that any person shall be eligible to be a member of the society provided he ........................ does not own a building. Though the bench was inclined to take the view that even under the Bye-Law 5(1)(c) the petitioner would be disabled from continuing to be member of the society if he owned a house they did not give a final decision because according to them Rules of 1973 in any case bar the petitions from continuing to remain a member of the Society. The bench did not express any opinion because they thought that it was possible that the Bye-law when it said that any person shall be eligible could cover possibly only a person who was to become a member in future and would not affect a person who was existing as a member already. We however, are of the view otherwise as mentioned earlier. But to come back to the Consideration of Rule 25(2), the bench has taken the view that Rule 25(2) which disqualifies a person with back date was valid even if it. had retrospective effect and had relied on Section 97(2)(v) which perinits the Lt. Governor to frame Rules about the conditions to be complied with by persons applying for admission or admitted as members. The bench has taken the view that Section 97(2)(v) empowered the framing of a Rule which would affect not only the persons applying for membership but also persons who were admitted as members already ). We cannot agree to such a broad generalisation of Section 97(2)(v) as having permitted framing of a rule, with retrospective effect as to affect vested rights. The bench read the words 'or admitted as members' as equivalent to the words 'persons who were admitted as members already' meaning persons who were members prior to the coming into force of the Rules. We do not agree. No doubt if any rules are framed as to what is to be done by those who are members the same will no doubt be applicable both to the persons who applied after the coming into force of Rule 25 and those who were Biready members even earlier than the Rules. But all that it means is that Rules may provide for conditions to he complied with by existing members but only in future. This rule is not to be read as giving any substantive power to divest any person of his membership. 'It is a fundamental rule of English Law that no statute shall be construed so as to have a retrospective operation, unless its language is such as plainly to require such a construction. And the same rule involves another and subordinate rule, to the effect that a statute is not to be construed so as to have a greater retrospective operation than its language renders necessary.' (Vide Craise on Statute Law, 17th edition page 387 & 388). 'It is well recognised rule that statutes should be interpreted, if possible, so as to respect vested rights, but such a construction should never be adopted if the words are open to and there construction'. (Vide Craise on Statute Law, 17th edition page 397(97)). As regards the question whether any rule framed by a subordinate authority is retrospective or not it is well to remember that it will depend upon the language employed in the statutory provision which may in express terms or by necessary implication empower the authority concerned to make a rule or regulation with retronpective effect. But where no such language is to be found it has been held by the courts that the person or authority exercising subordinate legislative functions cannot make a rule, regulation or bye-law which can operate with retrospective effect.' (Vide : [1970]75ITR174(SC) ; I.T. Officer, Alleppey v. M.C. Ponnoose). In this connection whether the Act empowers the Rules to be made retrospective effect reference may be made to Section 7 of the Delhi Land Reforms Act 1957 which provides that all rights of an individual proprietor pertaining to the waste land, grazing ......... ......... ......... ......... shallo w.e.f. the commencement of this Act be terminated in accordance with the provisions of sub-section (2) and the said contracts if any shall become void w.e.f. such commencement. Sub-section (2) of Section 7 further empowers the Deputy Commissioner to pass an order in respect of the proprietor or proprietors of each village either singly or collectively to divest the individual proprietor of all rights mentioned in subsection (1) and vesting those rights in Gaon Sabha w.e.f, the commencement of the said Act. Thus when a notification is issued by Delhi Administration under Section 7(2) even though issued subsequently it will operate from the date of the commencement of the Act for the simple reason that Section 7(1) itst If provides that all rights in waste, grazing land shall w.e.f. the commencement of this Act be terminated. I he power to issue a notification with retrospective effect thus vests by virtue of power given under the Main Act. In the present case, however, there is no provision in the statute permitting a Rule to be framed with retrospective effect. The bench in Madhok's case (supra), however, held that Section 97(2)(v) specifically empowers the Lt. Governor to make a rule with retrospective effect because of the words 'or' admitted as members' ; meaning thereby the person who have already been admilted as members. In our view the bench read wrongly a power to frame retrospective rule in section 97(2)(v). In our opinion the search for power specifically given from the enumerations given in clause (2). The power to free rule retrospectively has to be specifically provided for. Now the general power to frame rules is given by Section 97(1) to the Lt. Government to make rules to carry out the purposes of this Act. It is apparent that Section 97(1) does not empower the framing of rules which would have a retrospective effect. To invoke sub-section (2) which is merely illustrated as is clear when it says that in particular and without prejudice to the generality of foregoing power such rule may provide for various matters mentioned therein, as empowering the framing of a rule with retrospective effect is to mis-appreciate the scope of such a provision. It is well settled that the specific provisions as are contained in several clauses of Sub-section (2) of Section 97 are merely illustrative and they cannot be read as restrictive of the generality of powers prescribed by sub-section (1) of Section 97. The particular matters given in sub-section (2) of Section 97 only illustrative and do not exhaust all the powers conferred. In that connection reference may be made to Afzal Ullah v. State of Uttar Pradesh : [1964]4SCR991 wherein principle for interpreting a similar provision were laid down. This rule of interpretation was again reiterated in R. & H. Distt. Electricity Supply Co. v. State of UP. Air 1966 1471 wherein it was again said that the enumeration of particular matters by sub-section (2) will not control or limit the width of powers conferred on the appropriate government by sub-section (1). Thus to read section 97(2)(v) as having permitted the framing of a retrospective rule as the bench in Madhok's case (supra), did or even as the later bench in Lall's case (supra), (but for the fact that later bench was inclined to read the words for 'admilted' in Section 97(2)(v) differently from the manner it was read by the earlier bench), Was inapposite because the power to frame rule with retrospective effect would have to be specifically found in Section 97(1) itself. If such a power cannot be so found the authority to frame rules with retrospective effect could not be spelt out by invoking the particular matters given in sub-section (2). It will be appreciated that even if clause (v) of sub-section (2) of Section 97 was not there the power to frame a rule for the purpose mentioned in clause (v) of sub-section (2) of section 9 be covered by the power given to Lt. Governor to make rules to carry out the purposes of the Act. As the Act permits the constitution of Cooperative Societies it is apparent that the conditions to be complied with by the persons applying for admission or admitted as members and the election and admission of members and payments would necessarily be the purposes for which the Lt. Governor would have power to frame Rules. We may note that the later division bench in S.B. Lull's case did not doubt that the power to frame Rule 25(1 )(c) and 25(i) could be framed for the purposes of the object of the Act. The only reason it held Rule 25(2) to be ultra virus was because it was of the view that as the rule was meant to operate retrospectively and as there was no specific power in the Statute to frame the Rule with retrospective effect the same was beyond its jurisdiction. We shall deal with the aspect-whether this rule is retrospective a little later. But that the farming of a rule like Rule 25 would fall within the generality ofthe power given under Section 97 to frame rule cannot admit of any doubt. The Lt. Governor does not have to invoke the particular matters mentioned in sub-section (2) to be able to frame a rule like Rule 25 it will be appreciated that Rule 25(2)(1) and (2) has the effect of providing that a person will be disqualified for being a member if he owns a residential house or a plot of land in his or in his wife's or in the name of his dependent children. The purpose this rule is obvious. As there is large scale housing shortage and as land is limited the Government must so frame and modulate its policies that it should be able to satisfy as large a number of people in their need of providing houses to them. This can only be done if the distribution in the shape of land at concessional prices and with governmental aid is done to meet the genuine need of each family. This purpose would certainly be defeated it there was no limitation on a person or on a family acquiring more than one residential plot. It is true that there may not be any legal bar to a family or a person owning more than one house. If the person dies, want to own it and if there is no prohibition in law he may do so but then he cannot be permitted to avail of the instrumentality of a cooperative society io further this end. We must remember that Rule 25(1) (c) (2) and (2) have been framed and is applicable to only member of the Co-op. Societies. Section 4 of the Delhi Cooperative Societies Act 1972 clearly lays down that a society which has as its object the promotion of economic interests of its members in accordance with co-operative principles, or a society established with the object of facilitating the operations of such a society, may be registered under this Act. Thus the societies registered under the Act and to which Rule 25 will be applicable are societies which are meant to advance the interests of members in accordance with cooperative principles. 'A cooperative society is a union of persons established according to principles of equality, the number of whose members is not limited, and the purpose of which is, by the joint performance of economis acts, to improve the financial position of its members or the conditions under which they carry on their possession, by means of either pure self help, or self help with Government support, provided that all profits made by joint action shall be distributed in proportion to the extent to which each member has taken part in the business, and not in proportion to the capital invested, A co-operative Society may be defined as a voluntary association of individuals combined to achieve an improvement in their social and economic conditions through the common ownership and democratic management ofthe instruments of wealth'. (Vide Row's Encyclopedia of Co-operative Societies law in India, Vol. 2, page 1). Experience has shown that voluntary organisations in cooperative is the best system which can suit the needs of poor and weakers sections. The object of co-operative society is not to earn 75 profits but to enable the members to improve their economic conditions by helping them in their pursuits. Thus the cooperative societies like the present one which have the effect to obtain the land at concessional rate from the government and to build houses must necessarily have limitation that only members who are in real need of houses would be permitted to become members and to take the benefit of land allotment. In the garb of cooperative society a person cannot be permitted to avoid the stress of market prices and take a concessional advantage in obtaining a plot. Thus Rule 25(2) does not in any manner go beyond the ambit of rule making authority given under Section 97(1) of the Act. The question then is whether Rule 25(2) has retrospective effect or not. This brings us to the consideration of I.L.R. 977 (2) Delhi 164 SB. Lall & another v. Registrar of Cooperative Societies, New Delhi and anr., decided by Prakash Naiain, J. (as his lordship then was) and Safir, J.. In that case the writ petitioner owned a land and a house but was also a member of another co-operative society when 1973 rules came into force. As under the Rules he would not be entitled to the allotment of a plot of the co-operative society he challenged sub-rules (2) & (3) of Rule 25 as being ultra vires. The bench proceeded on the assumption that Rule 25(2) & (3) operated with retrospective effect and the only question to be decided was whether it was beyond the scope of rule making power postulated by Section 97(2)(v) of Delhi Co-operative Societies Act 1972. The bench noticed the tin earlier case Balraj Madhok & Others v. Registrar of Co-operative Societies and others, I.LR. (1974) 2 Delhi 684 the validity of the said rule had been upheld. The bench, however, observed that the earlier division bench was more concerned with the validity of the bye-laws of the society than the validity of Rule and that the bench had not considered the question as to whether Rule 25(2) was ultra vires. With respect we feel that the division bench in Lall's case was not correct in this interpretation of the decision in the earlier division bench. As a matter of fact though the earlier division bench did notice the bye-laws and though it did say that there was much to be said for the view that even under the 1968 bye-laws, bye-law 5(i)(e) disabled the said writ petitioner to continue as a member of the society, it specifically stated at page 683 in Madhok's case (supra), that, 'we do not, however, need to base our decision of this case on the construction of bye-law No. 5(i)(e) inasmuch as, in our view the provisions of the Delhi Cooperative Societies Act, 1972 and the Rules framed there under, to be considered later, are decisive to show that the petitioners could not, at any rate, continue to be members of the society after April 2, 1973'. In fact in Madhok's case (supra), the bench noticed that Rule 25 has been framed under Section 97(2)(v) which empowered the framing of the Rule. Commenting on this aspect the bench observed at page 689 as follows: 'If, on the other hand, it is construed to apply to persons who had already become members, then even before the coming into force of the new Act and the new rules, the petitioners had ceased to be members on the coming into force of the bye-laws of 1968. At any rate the petitioners ceased to be members of respondent 3 society from April 2, 1973 w R 25 came into force'. The earlier division also noticed the argument that Rule 25 could not take away the right from the petitioner when it was saved by Section 98. This plea was specifically rejected by holding that what Was saved by Section 98 76 was taken away by Section 92(1) read with Rule 25(2). So it is not correct to say that the virus of Rule 25 was not considered by the earlier division bench. In the later division bench S.B. Lall's case (supra), the bench observed that it is only the legislature which can legislate retrospectively and Section 97(2)(v) has not given that power and Rule 25(2) insofar as it has retrospective effect must be held to be ultra viies the Rule making power and postulated by S. 27 of 1972 Act and it, thereforee, declared it to be ultra virus of Section 97(2)(v) of the Act. In coming to this decision the bench was much impressed by the fact that in Section 97(2)(v) there was no comma after the word 'admission' so that the disability that can be prescribed to continue the membership can only be a prospective disability and it could not provide for a disability which did not exist previously but by virtue of the rule is deemed to exist retrospectivtly. In our view the bench placed unnecessary emphasis on punctuation. It is well settled that punctuation forms no part of any act. (Vide Craise on Statute page 198, foot note 60, 17th ed.). As noticed in the foot note repeating the observations of Lord Jamieson which staled ; 'while notice may be taken of punctuation in construing a statute, a comma or the absence of a comma must be disregarded if to give effect to it would so alter the sense as to Le contrary to the plain intention of the statute'. That the existence of a comma may be omitted while interpreting the intention of Statute was also made clear by Herman, L.J. in (1965) 1.Q.S. 214 ; Luby v. Newcastle-Under-Lyme Corporation, wherein the by section 113(4) of the Housing Act 1957, ''the local authority shall from time to time review rents and make such changes, either of rents generally or of particular rents, and rebates (if any) as crcumstances may required'. This is to be read as though there was no comma after ''rents' where that word occurs for the third time. 'The obligation,' said Herman L.J. 'is not to make rebates, as grammatically it should be if the comma were there, but to make changes of rebates (if any).'

(9) Thus we do not think that much significance can be attached to the absence of a comma. In our view even if the comma was there the Rule would only indicate the conditions to be complied with by persons applying for admission or admitted as members, Admitted as member could not be read as a person who were admitted as members already and thus to apply the rule retrospectively. Of course rules can be framed to prescribe conditions to be complied by persons applying for admission or admitted as members which means persons who already stand admitted. But this does not mean that the rule as such to operate with retrospective effect in that it is taking away some vested right. Both the benches held that as a person would cease to be a member on the coming into force of the Rules on account of his having been a member or having owned a plot earlier to the comng into force of the Rule 1973, Rule 25 has to be considered as if it was retrospective in effect. With respect we feel that both the division benches fell into error in assuming that the Rule 25(1 )(c) or Rule 25(2) is retrospective in operation. Merely because a person who had become a member of the society at a point of time when the disqualification mentione in Rule 25 was not in existence and because of the said rule would now cease to be a member of the society does not necessarily mean that the said rule is retrospective. 'A statute is not properly called a retrospective statute because a part of the requisites for its action is drawn from a time and ecedent to its passing'. (See Craise on Statute Law. 17th edition page 386). Reference may also be made to Queen v. Vina (1875) 10 Q.B 195 wherein the Statute enacted that every person convicted of felony shall be for ever disqualified from celling spirits by retail. It was held that the disqualification applied to every convicted felon irrespective of whether he was so convicted prior to or after the Act came into operation.

(10) A reference may also be made to Re : Solicitors Clerk (1957) 3 AH. E.R. 617 ; wherein it was saiJ that 'the Solicitor's Act 1956 provided that no solicitor should employ any person who is convicted of larceny without the permission of the Law Society. The clerk in that case was convicted of larceny in 1953, while the ban was imposed in 1956. It was urged that the provisions of the 1956 Act cannot be applied to him because he was convicted before that Act came into operation. To do otherwise would be to make its operation retrospective'. In rejecting this contention Lord Goddard, C.J. observed : in my opinion, this Act is iiot in truth retrospective. It enables an order to be made disqualifying a person from acting as a solicitor's clerk in the future and what happened in the past as the cause or reason for the making of the order ; but the order has no retrospective effect. It would be retrospective if the Act provided that anything done before the Act came into force or before the order was made should be void or voidable, or if a penalty were inflicted for having acted in this or any other capacity belore the Act came into force or before the order was made. This Act simply enables a disqualification to be imposed for the future which in no way affects anything done by the appellant in the past. Accordingly, in our opinion the disciplinary committee had jurisdiction to make the order complained of'.

(11) Same principle was applied in State of Bombay v. Vishnu Ramchandra : 1961CriLJ450 where Section 57 of the Bombay Police Act, 1951 authorised removal of a person from an area if he has been convicted of certain offences including theft. The Supreme Court held that 'Section. 57 of the Bombay Police Act, 1951 does not create a new offence nor makes punishable that which was not an offence. It is designed to protect the public from the activities of undesirable persons who have been convicted of offences of a particular kind. The section only enables the authorities to take note of their conviction and to put them outside the area of their activities so that the Public may be protected against a repitilion of such activities......... An offender who has been punished may be restrained in his acts and conduct by some legislation, which takes notes of his antecedents, but so long as the action taken against him is after the Act comes into force, the statute cannot be said to be applied retrospectively.' All these authorities were reviewed in detail by one of us (M..L. Jain, J ) in Kailash Chandra v. Rajasthan University. In that case the petitioner had been a member of the University syndicate for some time in 1975 and 1976. The ordinance of 1977 amended the University Act providing that no person shall be eligible for election for more than 2 terms. The writ petitioner, whose nomination was rejected challenged this on the ground that this provision by which a new condition had been added could not operate retrospectively. The argument being that the disqualification could only apply to those persons who are elected for two terms subsequent to the coming into force of the amended Act. Rejecting the argument that this bar cannot apply to persons who have had more than 2 terms previous to the coming into force of the Act the learned Judge observed, if and we may say with respect, rightly and aptly that 'Retrospective Operations' is an inaccurate 78 term causing confusion. The purest cases of retrospective laws are those in which the date of commencement is earlier than enactment, or which validate some invalid law, otherwise, every statute affects rights which would have been in existence but for the statute and a statute does not become a retrospective one because a part of the requisition for its action is darwn from a time antecedent to its passing.' The learned Judge, thereforee, concluded that, 'I am, thereforee, firmly of the view that the impugned provision does not operate retrospectively and operates only prospectively while taking the past into account in order to determine eligibility. It could not affect any right acquired in the past nor does it attach any new disability in respect to transactions or considerations already past'. We entirely agree with this summing up of law. Applying that ratio to the present case the conclusion is inescapable, that Rule 25(2) is not retrospective. All that the effect of Rule 25(2) is that it operates in future, though the basis for taking action is the factum among a plot in the past. Thus when by virtue of Rule 25(2) the petiioner is deemed to have ceased to be a member of Preet Nagar Society the ceaser operates from April 2, 1973, when the rules came into force. The mere face that the reason for disqualification is because of his having had a house in 1958 does not make the rule retrospective. This part fact is only the reason for disqualification in future. We cannot, thereforee, agree with either of the division benches when they held Rule 25(2) to be retrospective. As such the question of Rule 25(2) being ultra virus does not arise. This finding of court should also give a solace to Mr Ramesh Chandra who had conjured up a very frightening picture that if a person had already been allotted a plot and had made construction over it prior to coming into fores of 1973 Rules and if he was now deemed to have ceased to be a member since 1958 it may result in his haying to be depcieved of the house. We do not apprehend such a result, If a person has already acted upon earlier allotment and built on a plot which was given to him by the society prior to 1973 Rules he naturally cannot be divested of that property. Rule 25(2) only says that if a member becomes or has already become subject to and disqualification specified in sub-rule (1) he shall be deemed to have ceased to be a member from the date when the disqualifications were incurred. Rule 25(1) says that no person shall be eligible for admission as a member if he owns a residential house or a plot. In the present case petitioner owned a plot in 1988 when he became a member of the Preet Nagar Society. At that time of course he was qualified to become a member because there was no bar. Interpreted literally it could mean that the petitioner being subject to disqualificatian in sub-rule (1) because of his owning the house is to be deemed to have ceased to be a member from the date the disqualification was incurred which if interpreted retrospectively would mean that since he was not entitled to be given a plot in 1960 he must be divested of the plot/house. But the interpretation is impermissible because of our finding that Rule 25(2) is not retrospective. But if the words 'from the date when the disqualifications were incurred' are interpreted retrospectively to mean from the framing of the Rules in 1973 or subsequently then Rule 2512) will not operate retrospectively. In such a case if a plot or a house has already been given to him in 1958/1960 he will be able to retain it because he would only be deemed to have incurred disqualification only from April 2, 1973 onwards. But if by April 2, 1973 no plot had been given to such a member, and as he would be disqualified from April 12, 1973, he shall be deemed to have ceased to be member from the said date with the 79 result that he would not be qualified for being given a plot or eligible for a member of the society from April 2) 1973 onwards. We are inclined to give this interpretation to Rule 25(2) both because it flows from the words used and also because it will save the validity of Rule 25(2), and we so held. In that view we held that Rule 25(2) and (3) does not suffer from any infirmity and are intra vires. The contrary opinion expressed in Lall's case (supra), is overruled, as not laying down correct law. We affirm the view expresses in Mudhok's case that Rule 25(2) is intra virus than with a different ground of reasoning as given in Madhuk's case (supra). In that view the action of the respondents in cancelling the petitioner's membership and refusal to allot the plot to the petitioner was lawful because the petitioner must be deemed to have ceased io be a member from Aplil 2, 1973, and the question of making any allotment to the petitioners subsequent to that date would be per so impermissible and the action of the respondents cannot be faulted on any account.

(12) Before we part with the case we cannot help but noticing a very peculiar and unhappy feature. As far back as in Lall's case (supra) the Division Bench held Rules 25(2) to be ultra vires. We would have normally expected the Registrar of the Co-operative Societies, Delhi Development, Authority, Land and Development authorities and other concerned authorities to take note of this decision and to lake appropriate remedial steps, Surprisingly, there was total inaction ; neither any steps were taken to go in appeal against the said judgment nor any other appropriate steps taken. Not only that but in supreme and uncalled for indifference to the said division bench the authorities have proceeded to take action under Rule 25(2). We cannot but depriceate this approach of the authorities. When a Division Bench of High Court holds Rule 251(2) to be invalid the mandate of the judgment must be obeyed and necessary corrective steps sought for. To ignore the decision of High Court shows an attitute which cannot but be sub-versive of the proper administration of justice. We hope that the authorities will bear their in mind in future if and when any similar situation arises wilh regard to any provision of law. Now of course as we have hold Rule 25(2) & 3 to be intra vires, nothing need to be done.

(13) We need say no more. The result is that the petition fails and is dismissed but with no order as to costs.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //