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SCA/1616/1993 16/ 16 JUDGMENT
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
SPECIAL
CIVIL APPLICATION No. 1616 of 1993
For
Approval and Signature:
HONOURABLE
MR.JUSTICE JAYANT PATEL
=========================================================
1
Whether
Reporters of Local Papers may be allowed to see the judgment ?
2
To be
referred to the Reporter or not ?
3
Whether
their Lordships wish to see the fair copy of the judgment ?
4
Whether
this case involves a substantial question of law as to the
interpretation of the constitution of India, 1950 or any order
made thereunder ?
5
Whether
it is to be circulated to the civil judge ?
=========================================================
VASUDHA
WD/O VINAYAK GOKGHALE - Petitioner(s)
Versus
PRABHAT
COLONY CO.OP.HOUSING SOCIETY LTD. & 1 - Respondent(s)
=========================================================
Appearance
:
MR
AY KOGJE for
Petitioner(s) : 1, 1.2.1, 1.2.2, 1.2.3,1.2.4 NOTICE SERVED for
Petitioner(s) : 1.2.1, 1.2.2, 1.2.3,1.2.4
RULE SERVED for
Respondent(s) : 1,
MR NV SOLANKI for Respondent(s) :
2,
=========================================================
CORAM
:
HONOURABLE
MR.JUSTICE JAYANT PATEL
Date
: 19/06/2008
CAV
ORAL JUDGMENT
The
short facts of the case appears to be that as per the petitioner,
Vinayak Vishnu Gokhale (hereinafter referred to as ‘the Original
Petitioner’) paid an amount of Rs.650/- on 5.3.1979 to the
respondent No.1 Society for becoming the member. On 11.4.1979, the
original petitioner further deposited an amount of Rs.9,600/- with
the Society and ultimately a further amount was also paid and
receipt was issued by the Society on 19.5.1979 for the amount of
Rs.17,802/-, which included the earlier amount deposited. As per
the petitioner, the share certificate was also issued, copy whereof
is produced at Annexure D, by the society vide certificate No.94 for
holding five shares by Jitendra Chunilal, which in turn were
transferred in favour of the original petitioner on 10.7.1979. It
is further case of the petitioner that on 21.4.1980 the respondent
No.1 Society has also passed the Resolution for allotment of ‘A’
Type Block No.5 to the original petitioner. It is further case of
the petitioner that the revenue entry was also mutated for such
purpose and as the petitioner was desirous to take loan, the
certificate was also issued by the Society for holding of ‘A’ Type
Block No.5 and the payment made for such purpose and clear
marketability of the title of the Society vide Certificate dated
21.4.1980. It is also the case of the petitioner that another
certificate came to be issued on 14.3.1980 by the Society to the
effect that if the property is mortgaged by the original petitioner,
without prior approval of Anyonya Sahakari Bank Limited, the same
shall not be transferred to anyone else. It is also the case of the
petitioner that the petitioner subsequently paid the additional
amount to the society and the notice was also issued by the society
to the petitioner, calling upon him to pay the remaining amount of
Rs.9,964/- and, therefore, the petitioner contends that the
petitioner was admitted as the member and the aforesaid block was
allotted by the society to the petitioner.
It
appears that as per respondent No.2, the President of the society
allotted the very block to respondent No.2 and it is the case of the
respondent No.2 that based on the documents issued, including that
of the share-certificate and the payment made in the year 1982, the
respondent No.2 obtained a loan from the State Bank of India and at
that stage, the respondent No.2 came to know that the President of
the society had also issued similar share certificates, etc., to
the petitioner and, therefore, respondent No.2 had filed Lavad Suit
No.646 of 1983 before the Registrar’s Board of Nominee for
protecting the possession and prohibiting the interference in the
further construction. In the said suit, the petitioner was not
impleaded as the party. The pertinent aspect is that in the said
suit, the society had filed the reply and it was stated that by way
of a temporary measure, the papers were given, but the respondent
No.2 herein had agreed that he would accept any block, which might
be allotted by the society and the society had to allot block
No.11/A and Block No.5/A, which was subject matter of the suit was
allotted to the original petitioner herein. The aforesaid pleadings
of the society in the aforesaid suit support the case of the
original petitioner. However, the fact remains that the original
petitioner did not take any action during the period of 1983 onwards
and only in the year 1985, the original petitioner preferred Lavad
Suit No.1161 of 1985 before the Registrar’s Board of Nominees for
the relief, inter alia, of declaration that the property of Block
No.5/A admeasuring 700 sq. ft. of the Society is belonging to the
petitioner and the defendant be directed to entrust the vacant
possession of the property. It appears that pending the aforesaid
respondent No.2 has withdrawn Suit No.646 of 1983, which was for the
injunction. It appears that the learned Nominee tried the suit and
ultimately passed the judgement and the award dated 30.12.1991,
whereby the suit was not accepted but it was directed that the
defendant No.1 society shall refund the amount, which was deposited
by the plaintiff and credited in the account of the society or in
alternative, it was also directed that if there is any vacant block
in the society or if in future there is availability of the vacant
block, the same be allotted to the plaintiff.
The
petitioner carried the matter before the Gujarat Cooperative
Tribunal in appeal and the Tribunal vide its decision dated 30th
September, 1992 dismissed the appeal and it is under these
circumstances, the petitioner has approached this Court by
preferring the present petition.
Heard
Mr.Kogje, learned Counsel appearing for the petitioner and
Mr.Solanki, learned Counsel appearing for respondent No.2.
Respondent No.1 society was served but has chosen not to appear.
The learned Counsel appearing for the petitioner has made, the
record and evidence of the suit proceedings, available to the Court
during the course of the final hearing.
It
does appear from the record produced on behalf of the petitioner
that the payment was made by the original petitioner towards
membership and towards construction in part and the share
certificate also came to be transferred in favour of the petitioner.
It also appears that Block No.5 was initially allotted to the
petitioner and the said fact is supported by the pleadings of the
society made in the proceedings of Lavad Suit No.646 of 1983, copy
whereof is produced at Ex. 17 in the suit proceedings. Therefore,
the aforesaid documents go to show that the original petitioner was
admitted as the member and was also initially allotted Block No.5.
Therefore, the interest to that extent can be said to have been
created of the petitioner in the aforesaid part of the property of
the Society.
It
deserves to be recorded that in a housing cooperative society, the
ownership of the property of the society vests to the society and
the allotment of the plot or block, as the case may be, is being
made by the society. In the present case, as it appears, to be the
scheme for not only the allotment of the plot, but also for making
construction of a tenement and allotment of the tenement, after
completing the construction by the society, the possession after
allotment was to be entrusted to the member, who has been allotted
the block. The documents produced in the proceedings of the suit go
to show that the original petitioner was admitted as a member and
was allotted Block No.5/A, but it also appears that the actual
possession of Block No.5/A was not handed over to the petitioner on
account of either non-completion of the construction or non-payment
of the remaining amount by the petitioner to the society.
Therefore, the right, if any, of the petitioner could be said to
have been created in the property of the society to that extent
only. It also appears that in the year 1982 the respondent No.2 has
also paid the amount towards membership and construction to
respondent No.1 Society and the actual possession is entrusted by
the society to respondent No.2. Not only that, but the respondent
No.2 has obtained loan and at that time, as per respondent No.2, the
title clearance certificate was also obtained. It also appears that
the Society did complete construction as agreed and the respondent
No.2 had to complete the construction. As stated by the respondent
No.2 in the affidavit-in-rejoinder, all construction after plinth
level is made by him and it is further stated that the additional
construction is also made by him by investing the total amount of
approximately Rs.3,50,000/-.
It
is not the case of the petitioner that the respondent No.2 had
knowledge about the rights so created of the petitioner over Block
No.5. On the contrary, as per the petitioner, since he was working
outside Vadodara, when he inquired respondent No.2 was in possession
and was making construction and at that stage, he informed
respondent No.2 that the Block was already allotted to him and
possibly that situation has given rise to the filing of the earlier
suit in the year 1983 being Lavad Suit No.646 of 1983 preferred by
respondent No.2. It is also an admitted position that the original
petitioner did not take any civil action for prohibiting the
construction or development by respondent No.2 and only in the year
1985 by the present suit, prayed for declaration and the entrustment
of the possession.
In
normal circumstances, if a particular plot or a block is already
allotted by the society to a particular person, right of such person
to that extent in the property of the society may stand created, but
it is not an interest created as if the transfer of the ownership to
the fullest extent by the society to the concerned person or the
member. In a given case, if the society on account of the default
by the member has cancelled the allotment and has not handed over
the possession of the block to such member, it may give cause to the
aggrieved member to approach before appropriate forum for
enforcement of such right, but thereby, it cannot be said that once
the allotment is made but the same is actually not acted upon, the
society will lose all interest over the property. Further, if the
possession is already haded over after allotment of the same to the
member concerned, it may stand on a different footing and the right
of such member in such property of the Society may stand
crystallized to a greater extent, but the possession not handed over
would not stand on the same footing.
Apart
from the above, as per the petitioner as well as respondent No.2,
the President of the Society has cheated both of them namely; the
petitioner as well as respondent No.2. It was submitted by the
learned Advocate for the petitioner as well as respondent No.2 that
money is collected by the President of the society from the
petitioner and also from respondent No.2 and such action on the part
of the President of the Society has created the present situation,
whereby the petitioner as well as respondent No.2, both, are made to
suffer.
There
is no reliable, cogent evidence on record to show that respondent
No.2 became member and obtained possession of Block No.5/A with the
conscious knowledge that the original petitioner was already
allotted the same block. The documents produced on behalf of the
respondent No.2, on the contrary, go to show that respondent No.2
acted in bonafide for becoming the member of the society and also
for getting the allotment of the block. As the society did not
complete the construction, respondent No.2 had to make the
construction at his cost. Therefore, it appears that the respondent
No.2 can be said as having acted in bonafide for becoming member and
for getting the allotment of Block No.5/A. The aforesaid is coupled
with the circumstances that not only the construction is completed,
which was agreed to be made by the Society, as on today, as per the
respondent, he has incurred an expense of about Rs.3.50 lac for
completing the construction and for making additional construction.
However,
it appears that even if the respondent No.2 has acted in bonafide
and has acquired the property of Block No.5/A from the Society, the
rights so created of the original petitioner on account of the act
and the agreement already undertaken by the society prior thereto,
shall not stand vanished and it would be required for the society to
compensate the loss, if any, caused on account of its action of
allotment of one block to two persons, more particularly when both
such persons have acted in bonafide and the action of the society,
may be by itself or through its President, has put both such persons
to peril.
In
view of the aforesaid circumstances, it appears that when respondent
No.2 has acted in bonafide, the Court may not grant relief for
treating the allotment made to respondent No.2 as cancelled and for
entrustment of the property to the original petitioner. However, it
would be required for the society to honour its liability towards
the action done by it and also to compensate the petitioner by
paying suitable interest upon the amount paid for becoming the
member and towards construction to be made by the society over Block
No.5/A. In the event, the Society has no property available like
common plot or liquid fund in the Bank etc., since, as observed
earlier, the rights to that extent over the property of the society
are read as created in favour of the petitioner over Block No.5/A,
it would be required for the respondent No.2 to pay such amount to
the petitioner and then to recover from the society as and when
common property or the fund is available, as the case may be. Such
a course appears to be in the interest of justice.
If
the views taken by the learned Nominee as well as by the Tribunal
are examined in light of the aforesaid observations, it does appear
that the Nominee as well as the Tribunal have committed error in not
considering the record and the material for creation of such rights
of the petitioner over such property to that extent, nor have both
the lower Authorities considered that even if respondent No.2 has
acted in bonafide once the right is said to have been created to
that extent in the property of the society, which is allotted to
respondent No.2, in the event of failure on the part of the society
to discharge its obligation, since respondent No.2 has acquired the
property, such liability should reach to the subsequent allottee,
who is respondent No.2 reserving liberty to him to recover from the
property or from the funds of the society in future. Therefore, it
can be said that both the lower Authorities have committed error
apparent on the face of record to that extent and hence, the
judgements of both the lower authorities deserve to be modified to
that extent.
In
view of the aforesaid, the suit of the plaintiff is decreed only to
the extent that the plaintiff shall be entitled to recover the
amount of Rs.20,551/- with the interest at the rate of 8% per annum
from 1982 till actual payment, from the common property and funds of
respondent No.1 Society. It is further observed that in the event
of non-availability of common property or funds of the Society, the
plaintiff shall be entitled to recover the aforesaid amount from
respondent No.2, who is allotted property of Block No.5/A of the
Society. It is also observed that in the event respondent No.2 has
paid such amount pursuant to the aforesaid decree on account of
non-availability of the common property or funds of the society, to
the petitioner, the respondent No.2 shall be at liberty to recover
the said amount from respondent No.2 society as and when common
property or funds of the society are available. The other reliefs
as prayed in the suit are not granted.
The
petition is partly allowed to the aforesaid extent. Rule made
absolute accordingly. Considering the facts and circumstances,
there shall be no order as to costs.
19.6.2008 (Jayant
Patel, J.)
vinod
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