Case Note & Summary
The petitioner, a member of the respondent Nagpur Cooperative Housing Society Ltd., was allotted plot No.122 by the Society, which had obtained 13 plots from the Nagpur Improvement Trust (NIT) for construction of residential bungalows. The petitioner claimed to have spent substantial amount on the plot, but the NIT cancelled the allotment due to his failure to commence construction within three years from the commencement of lease on 9-10-1962, despite extensions granted by the Society. The NIT resumed possession on 1-9-1970 and allotted the plot to the Society itself. The petitioner filed a civil suit (RCS No.588/1971) against the NIT, which was dismissed on 3-4-1976 on the ground of lack of jurisdiction, with the observation that the dispute should be referred to the Registrar of Cooperative Societies. The Society constructed a bungalow on the plot and leased it to Kailashchandra Agrawal, a non-member. On 19-12-1993, the Society's Annual General Meeting decided to sell the property, and after issuing an advertisement on 14-11-1994, sold it to Agrawal, admitting him to membership during the pendency of proceedings before the Cooperative Court. The petitioner had filed a dispute on 30-12-1993 before the Cooperative Court, which passed a status quo order on 13-2-1995. The Cooperative Court dismissed the dispute, and the appellate court affirmed the dismissal. The petitioner then filed the present writ petition. The High Court examined the facts and found that the petitioner's allotment was validly cancelled by the NIT due to his default, and the Society had acted within its rights in selling the property. The court held that the Cooperative Court had jurisdiction, the dispute was within limitation, and the sale was valid. The petition was dismissed.
Headnote
A) Cooperative Law - Member's Dispute - Jurisdiction - The dispute between a member and a cooperative society regarding allotment of plot and subsequent sale to a third party falls within the jurisdiction of the Cooperative Court under the Maharashtra Cooperative Societies Act, 1960, and the Civil Court has no jurisdiction to entertain such dispute (Paras 2-3).
B) Cooperative Law - Res Judicata - Dismissal of Civil Suit for lack of jurisdiction does not operate as res judicata in subsequent proceedings before the Cooperative Court (Para 2).
C) Cooperative Law - Limitation - The period of limitation for filing a dispute under Section 91 of the Maharashtra Cooperative Societies Act, 1960, is governed by the Act and the Rules, and the dispute filed in 1993 is within limitation as the cause of action arose when the Society decided to sell the property in 1993 (Paras 3, 5).
D) Cooperative Law - Sale of Property - Admission of Membership - The sale of property by the Society to a non-member after admitting him to membership during pendency of proceedings is valid if done in accordance with the Society's bye-laws and with the approval of the general body (Paras 3, 6).
E) Cooperative Law - Status Quo Order - Violation of status quo order by the Society in selling the property does not automatically invalidate the sale; the court may consider the equities and the conduct of parties (Para 3).
Issue of Consideration
Whether the appellate order dismissing the petitioner's appeal against the Cooperative Court's dismissal of his dispute is sustainable in law.
Final Decision
The High Court dismissed the writ petition, upholding the orders of the Cooperative Court and the Appellate Court.
Law Points
- Cooperative Society
- Member's Rights
- Jurisdiction of Civil Court
- Res Judicata
- Limitation
- Sale of Property
- Status Quo Order
- Admission of Membership
Case Details
2010 LawText (BOM) (04) 139
Writ Petition No.147 of 2001
Shri N.K. Ambilwade for Petitioners, Shri R.V. Shah for Respondent
Shri Balwant s/o Sitaram Peshne (since deceased through LRs: Smt. Shalini Balwant Peshne, Shri Pramod Balwant Peshne, Shri Rajendra Balwant Peshne, Sou. Vijaya w/o Rameshrao Thaware, Sou. Vanita Sanjayrao Duragkar, Sou. Ujwala Pradip Gadge)
Nagpur Cooperative Housing Society Ltd.
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Nature of Litigation
Writ petition challenging appellate order dismissing member's dispute against cooperative society regarding cancellation of plot allotment and sale to third party.
Remedy Sought
Petitioner sought quashing and setting aside of appellate judgment and order dated 12-8-1999 passed by the Member, Cooperative Appellate Court, dismissing his appeal against the judgment and order dated 2-2-1998 passed by the Judge, Cooperative Court, dismissing his dispute.
Filing Reason
Petitioner claimed that the respondent Society illegally cancelled his allotment of plot No.122 and sold it to a third party, violating his rights as a member.
Previous Decisions
Civil Suit No.588/1971 filed by petitioner against NIT was dismissed on 3-4-1976 for lack of jurisdiction. Cooperative Court dismissed petitioner's dispute on 2-2-1998, and Cooperative Appellate Court dismissed appeal on 12-8-1999.
Issues
Whether the Cooperative Court had jurisdiction to entertain the dispute?
Whether the dispute was barred by limitation?
Whether the sale of property by the Society to a third party was valid?
Whether the status quo order was violated and its effect?
Submissions/Arguments
Petitioner argued that the allotment of plot was in his favour and the Society illegally cancelled it and sold the property to a non-member, violating his rights.
Respondent argued that the allotment was cancelled by NIT due to petitioner's failure to construct within time, and the Society acted within its rights in selling the property after due process.
Ratio Decidendi
The dispute between a member and a cooperative society regarding allotment of plot and subsequent sale is within the jurisdiction of the Cooperative Court under the Maharashtra Cooperative Societies Act, 1960. The petitioner's failure to construct within the stipulated time led to valid cancellation of allotment by NIT, and the Society's sale of property to a third party after due process was valid. The status quo order did not invalidate the sale as the petitioner had no subsisting right in the property.
Judgment Excerpts
The petitioner is a member of the respondentSociety, which had been allotted 13 plots of land at Bajaj Nagar, Nagpur, by the Nagpur Improvement Trust (NIT) for construction of residential bungalows.
The Civil Court, by order dated 341976, held that it had no jurisdiction to try the suit, observing that the dispute would have to be referred to the Registrar of the Cooperative Societies.
The respondentSociety contested the proceedings before the Courts below, pointing out that the allotment of plot in favour of the petitioner was cancelled by the NIT, as he failed to commence construction within stipulated time of three years from the date of commencement of lease, i.e. from 9101962, in spite of the notices and warnings.
Procedural History
Petitioner filed civil suit (RCS No.588/1971) against NIT, dismissed on 3-4-1976 for lack of jurisdiction. Petitioner filed dispute before Cooperative Court on 30-12-1993, which was dismissed on 2-2-1998. Appeal to Cooperative Appellate Court was dismissed on 12-8-1999. Petitioner then filed the present writ petition on 19-1-2001.
Acts & Sections
- Maharashtra Cooperative Societies Act, 1960: Section 91
