Civil appeal No. 5448 of 2014 (Arising out of SLP (C) No. 692 of 2010), Civil Appeal No. 5450 of 2014 (Arising out of SLP (C) No. 4679 of 2010) and Contempt Petition (C) No. 302 of 2010 in SLP (C) No. 4679 of 2010. Case: 1. Md. Moinuddin and Ors., 2. The Voltas Employees Cooperative House Building Society, Rep. by its Secretary, K. Srinivas Rao, 3. B.K.S. Murthy Vs 1. The Commissioner for Cooperation and Registrar of Cooperative Societies and Ors., [Alongwith Civil Appeal No. 5449 of 2014 (Arising out of SLP (C) No. 3105 of 2010)], 2. B.K.S. Murthy and Ors., [Alongwith Contempt Petition (C) No. 251 of 2011 in SLP (C) No. 4679 of 2010 and Civil Appeal No. 5451 of 2014 (Arising out of SLP (C) 12842/14 CC No. 10023 of 2011)], 3. K.S. Sreenivasa Rao and Anr.. Supreme Court (India)

Case NumberCivil appeal No. 5448 of 2014 (Arising out of SLP (C) No. 692 of 2010), Civil Appeal No. 5450 of 2014 (Arising out of SLP (C) No. 4679 of 2010) and Contempt Petition (C) No. 302 of 2010 in SLP (C) No. 4679 of 2010
CounselFor Appearing Parties: A.T.M. Rangaramanujam, R. Basant and Jaideep Gupta, Sr. Adv., Neha Sharma, D. Verma, A.V. Rangam, Buddy A. Ranganadhan, G.V. Giridhar, D. Mahesh Babu, Suchitra Hrangkhawl, Amjid Maqbool, Amit K. Nain, Aditya Jain, Ramakrishna Rao, Gaurav Agrawal, Anup Kumar, Neha Jaiswal, Devvrat, Kasturika Kaumudi, K. Sharda Devi, Anurag...
JudgesSurinder Singh Nijjar and Fakkir Mohamed Ibrahim Kalifulla, JJ.
IssueAndhra Pradesh Cooperative Societies Act, 1964 - Section 4(2); Constitution of India - Article 226
Judgement DateMay 07, 2014
CourtSupreme Court (India)

Judgment:

Fakkir Mohamed Ibrahim Kalifulla, J.

  1. Delay condoned. Leave granted.

  2. In all the above appeals and the connected contempt petitions, the issue concerns with the members of a cooperative society called The Voltas Employees Cooperative House Building and Construction Society Ltd. No. TAB 508'. It is a classic case where the members of the above referred to society got themselves entangled in a series of litigations and to add to this, some orders were passed by the officials of the Department of Cooperative Society of Andhra Pradesh, which has created pandemonium by virtue of the divergent orders passed at different points of time and, therefore, requires the consideration of this Court to pass appropriate orders and put an end to this complicated litigation once and for all. The entire dispute amongst the members of the society pertains to a piece of land, which was purchased by the society in pursuance of its object of getting some benefit for its members for providing housing accommodation. Before delving deep into the controversy, raised in this litigation, it is necessary to set out the different Special Leave Petitions filed before us, wherein orders have been challenged by different Appellants which ultimately, as pointed out by us, pertains to the issue relating to the land purchased by the society for providing housing accommodation.

  3. Civil Appeal (@ SLP(C) No. 4679 of 2010) has been filed challenging the Division Bench order of the Andhra Pradesh High Court dated 15.09.2009, passed in Writ Appeal No. 144 of 2007 by which the High Court dismissed the Writ Appeal filed by the Appellant herein which is the very society, namely, the Voltas Employees Cooperative House Building Society (hereinafter referred to 'the society'). Civil Appeal (@ SLP(C) No. 3105 of 2010) has been filed by three individuals, namely, Shri M. Balaji, Bilquees Sultana and Konda Sureka, who were the Appellants in Writ Appeal No. 809 of 2007 before the Division Bench of the Andhra Pradesh High Court and whose writ appeal was also dismissed by the High Court in its common judgment dated 15.09.2009, along with Writ Appeal No. 144 of 2007.

  4. SLP (CC) No. 10023 of 2011 has been preferred by four individuals, namely, Nerella Venkateswarlu, S. Jagadish, Pasupula Anjaneyulu and Shanigarapu Ramesh seeking leave of this Court to file an appeal against the final judgment and order dated 15.09.2009 in Writ Appeal No. 144 of 2007, as well as Writ Appeal (MP) No. 2325 of 2009 in the said writ appeal. The Division Bench while dismissing the Writ Appeal No. 144 of 2007, by its common order, also dismissed the above Miscellaneous Petition No. 2325 of 2009 by which the Petitioners wanted to get themselves impleaded as parties in the Writ appeal.

  5. Civil Appeal (@ SLP(C) No. 692 of 2010) has been filed by five persons, namely, Md. Moinuddin, A Narasimha, Md. I. Shareef, Khalander Hussain and R. Shankar, seeking to challenge the common judgment dated 15.09.2009 of the Division Bench of High Court of Andhra Pradesh in Writ Appeal No. 798 of 2007, along with Writ Appeal Nos. 144 of 2007 and 809 of 2007.

  6. To narrate the facts in brief, the Voltas Employees Cooperative House Building and Construction Society Ltd. was registered on 29.10.1982 under the Andhra Pradesh Cooperative Societies Act 7 of 1964. Its address was 4-161, Madhavi Nagar, Firozguda, Hyderabad. Its operations were confined to the municipal limits of Hyderabad. The object of the society is to carry on activities for the benefits of its members in the field of building including buying, selling, hiring, letting and developing land in accordance with the cooperative principles and also to give loans to its members for construction of dwelling houses. Under Bye-Law No. 4, the share capital of the society was to be made up of 5000 shares of Rs. 100 each. Bye-Law No. 5 prescribes the eligibility of a member. Bye-Law No. 6 deals with the procedure as to how an eligible employee of Voltas can become a member of the society. Bye-Law No. 8 with its Sub-clauses (i) to (iv), prescribes the disqualification for membership. Bye-Law No. 12 prescribes the procedure for withdrawal of the share capital. Bye-Law No. 16 describes as to how a member can be expelled from the society. Bye-Law No. 17 lists out the various sources by which the society can ordinarily obtain funds. Bye-Law No. 22 states the maximum period up to which the Managing Committee can function and the consequences of the proceedings becoming invalid on account of any vacancy or vacancies in the Committee, which remained unfilled. The powers of the Managing Committee has been set out in Bye-Law No. 28 and Sub-clause (d) of Bye-Law No. 28 empowers the Managing Committee to admit members and allot shares. Bye-Law No. 36 describes the powers of the General Body and the manner in which the General body is to be convened. Sub-clause (vi) empowers the General Body to deal with the expulsion of a member. Bye-Law No. 37(b) makes it clear that the General Body Meeting should consist of all the members of the society.

  7. Keeping the above said prescriptions in the Bye-Laws, when we proceed to analyze the various facts involved, we find that the society in the first instance had a membership of 28 members at the time of formation of the society in the year 1982, which rose to 43 as on 30.06.1982 and gradually the membership went up to 75 as on 31.03.1997, when 37 members stated to have got admitted in the year 1996. In fact, the whole controversy pertains to the admission of those 37 persons as members whose aspirations to get an allotment in the land originally purchased with the funds provided by the 11 founder members gave scope for this controversial and complicated litigation amongst themselves. In the year 1982, the society purchased a land measuring 1 acre 14 guntas in Survey No. 233 of Thokatta Village. The entire land cost was paid by 11 of the founder members.

  8. In one of the statements placed before this Court, discloses that as on 30.06.1984, the advances collected from the members towards the land cost were Rs. 64,000/- and that the contributors were 33 in number, two of whom stated to have got back the advance deposited by them with the society.

  9. Be that as it may, the Deputy Registrar of Cooperative Societies Housing in a letter dated 25.09.1996, addressed to the President and Secretary of the Society, referred to a representation received from Shri Srinivasa Rao and other,. alleging that the Managing Committee in their Meeting refused to enroll them as members of the society. This was referred to the Cooperative Sub-Registrar by the office of the Deputy Registrar. On receipt of the report of the Cooperative Sub-Registrar, in the said communication dated 25.09.1996, the Deputy Registrar indicated to the society that the request of Shri Srinivasa Rao and others, are genuine and that they are eligible to become members of the society and, therefore, they should be admitted as members. The admission of their membership was also directed to be intimated to the office of the Deputy Registrar.

  10. In the minutes of the Executive Committee Meeting, stated to have been held on 03.10.1996 at 6 p.m., it was stated that as per the agenda dated 18.09.1996, the matter of admitting the 37 new applicants into the society was thoroughly discussed and unanimously decided to admit them as members. The said minutes, however, state that with the cooperation of new entrants, a suitable piece of land can be purchased for the interested new members and that the 37 members or any other member who wish to share a plot will be accommodated in the land to be purchased as a second venture of the society.

  11. By a letter dated 04.10.1996 addressed to the Deputy Registrar, Housing, the society confirmed the above resolution passed admitting the 37 new applicants as members in the Meeting held on 03.10.1996. Subsequently, the General Body Meeting was stated to have been held on 04.04.1997 at 6 p.m. in the society's premises. The agenda was to ratify the admission of the new members and also to explore the possibilities for a new venture. The resolution relating to ratification was passed and it was ratified. The other issues were discussed in the General Body Meeting. It was deliberated that since the new members did not join at the time when the land was purchased and for purchasing the said land the contribution was made only by the 11 members who continued to be members on the date of the General Body Meeting, they alone will have the right to get allotment in the said lands.

  12. By proceedings dated 17.04.1997, a general direction Under Section 4(2) of the Andhra Pradesh Cooperative Society Act, 1964 (hereinafter referred to 'the Act') was issued by the Registrar of Cooperative Societies, which inter alia contained a direction that no society shall admit any new members to be in waiting in service, except to the extent of maximum of 10% of members provided with the plots at any given time. It was further directed that no member of the society, who is not allotted a house or house site, shall be eligible to vote in the ensuing elections unless he completes one year as a member in the society. The electoral authorities were directed to take into consideration the said aspect while preparing the electoral roll of the members of the society. By virtue of Section 4(2) of the Act, all the cooperative societies were directed to comply with the above directions. Pursuant to the general direction issued on 17.04.1997, the Deputy Registrar came forward with a fresh communication to the society dated 01.12.1998, stating that the instructions issued by its office in its letter dated 25.09.1996, stood withdrawn with immediate effect. Closely followed by that, by a communication dated 20.07.1999, the members who were admitted in the Meeting held on 03.10.1996 were informed that subsequent to their admission, a resolution was passed in the committee...

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