Full Judgment Text
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 957 OF 2009
(Arising out of SLP (C) No. 9866 of 2007)
Hindustan Coop. Housing Building ..Appellant
Society Ltd.
Versus
Registrar, Co-operative Societies and Anr. ..Respondents
J U D G M E N T
Dr. ARIJIT PASAYAT, J.
1. Leave granted.
2. Challenge in this appeal is to the judgment of Delhi High Court in Writ
Petition No.686/1992 and Review Petition No.268/2006 in the aforesaid writ
petition.
3. Background facts in a nutshell are as follows:
On 5.9.1962 Anoop Singh who as a member wrote to appellant-Society
asking for refund of monies (Rs.3110/- towards membership and Rs.15,000/-
each for plot in appellant’s colony). The reason stated was that as the
membership process with appellant was getting delayed and he has purchased a
plot in Green Park and as per Govt. Policy there are no chances of getting more
than one plot in Delhi.
On 9.5.1972 late Anoop Singh filed application for transfer of his
membership in favor of his daughter, the respondent no.2.
On 18.11.1973, by a letter the appellant-society informed Anoop Singh
that the Managing Committee by resolution dated 05.09.1973 allowed the
transfer and asked for share certificate and other documents to enable transfer.
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On 12.10.1978, appellant-society requested Anoop Singh to file an
affidavit which was questioned by respondent no.2 by letter dated 27.10.1978.
On 26.3.1979 Anoop Singh did not file the requisite affidavit and
Administrator of appellant-society by letter informed that the transfer could not
be confirmed unless affidavit is filed.
On 14.4.1979 Anoop Singh replied stating that it is not possible to file
the affidavit as he does not know full or part of lease hold or freehold of the
property.
On 29.5.1979 Administrator informed Anoop Singh of his inability to
transfer the membership as the affidavit was not filed and asked to withdraw
the deposit from society to which Anoop Singh requested for reconsideration
vide letter dated 06.06.1979.
On 11.7.1979 appellant’s administration made it clear that no allotment
could be made in favour of respondent no.2 to which Anoop Singh again
requested for reconsideration vide letter dated 11.11.1979.
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On 22.3.1980 appellant-administration informed Anoop Singh that even
though clause 5(2) of Lease Deed provides for transfer without affidavit -
allotment of plot could not be possible unless original member establishes his
own eligibility for allotment for plot. However, opportunity of personal hearing
was granted to Anoop Singh.
On 24.11.1980, Administrator of appellant-society removed the name of
Anoop Singh categorically stating that it could not be transferred in favor of
respondent no.2.
On 22.1.1982, Secretary of the society also by its letter informed Anoop
Singh that transfer could only happen after submission of indemnity bonds and
affidavits so it is suggested that respondent no.2 be made fresh member of
society w.e.f. date of transfer.
On 1.02.1982 Anoop Singh tendered his resignation.
On 14.02.1992 respondent no.2 filed WP(C) being 686/92 without
challenging the orders of the Administrator dated 26.03.1979, 29.05.1979,
11.07.1979 and 24.11.1979, seeking writ of Mandamus asking appellant and
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respondent no.1 for allotment of plot or in alternative to refund money paid by
respondent no.2.
On 30.10.1995 Rule was issued. On 19.09.2005 ex-parte proceedings
qua appellant-society were initiated in High Court.
On 16.02.2006 the High Court allowed writ petition and issued
directions to respondent no.1 to recommend the case to appellant-society for
allotment of plot in category ‘C’ of 125 sq. yards.
On 22.05.2006 appellant-society came to know about the above order
vide letter dated t. 22.05.2006 issued by respondent no.1.
On 01.07.2006 appellant society then filed a Review Petition being 268
of 2006 and on 1.9.2006 the High Court issued notice. On 19.1.2007 the High
Court dismissed review petition.
The High Court by the order in writ petition held that the transfer in
favour of Jasjit Kaur has been accepted by the Society and therefore she was
entitled to allotment of the plot. It was held that the Registrar, Cooperative
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Society had no authority in law to sit over the affidavit and not to recommend
the case for allotment to Jasjit Kaur. A direction was therefore given to the
Registrar, Cooperative Societies to forthwith recommend the case of Jasjit
Kaur for allotment of plot in Category ‘C’ of 125 sq. yards. A Review Petition
was filed inter-alia taking the stand that after Mr. Anoop Singh had asked for
refund of money, and therefore, raising the question of any transfer in law did
not arise. The review petition was rejected on the ground that no case for
review was made out.
4. Mr. K.T.S. Tulsi, learned counsel for the appellant submitted that the
High Court has clearly lost sight of various provisions, more particularly, Rule
25 of the Delhi Co-operative Societies Rule, 1973 (in short the ‘Rules’) framed
under Delhi Co-operative Societies Act, 1972 (in short the ‘Act’). It was
pointed out that without availing the statutory remedies available under the Act
and the Rules, the respondent No.2 Jasjit Kaur filed a writ petition. Since
disputed questions were involved, the High Court ought not to have interfered
in the matter. According to him directions given are clearly contrary to law.
5. In response, learned counsel for respondent No.2 submitted that she has
been fighting a battle for getting her legitimate right and after having accepted
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the prayer for transfer, the Society cannot turn around and take a stand that
since Anoop Singh was disqualified, the order of the High Court is
indefensible. In any event it is submitted that plot has been allotted pursuant to
the High Court’s order and, therefore, by passage of time the petition has
become infructuous.
6. We find that before the High Court there was no appearance on behalf of
the present appellant.
7. Rule 25 of the Rules reads as follows:
“25. Disqualification of Membership:
No person shall be eligible for admission as a member of a co-
operative society if he-
(a) has applied to be adjudicated an insolvent or is an
undischarged insolvent; or
(b) has been sentenced for any offence other than an offence of a
political character or an offence not involving moral turpitude and
dishonesty and a period of five years has not elapsed from the date
of expiry of the sentence:
(c) in the case of membership of a housing society:
(i) 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 National Capital Territory of
Delhi, in his own name or in the name of his spouse or any of his
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dependent children, on lease hold or free-hold basis or on power
of attorney or on agreement for sale;
Provided that disqualification of membership as laid down
in sub-rule (l)(c)(i) shall not be applicable in case of co-sharers of
property whose share is less than 66.72 sq. metres of land;
Provided further that the said disqualification shall not be
applicable in case of a person who has acquired property on power
of attorney or through agreement for sale and on conversion of the
property from leasehold to freehold on execution of conveyance
deed for it, if such person applies for the membership of the
housing society concerned; (Amended on 6.8.97)
(ii) he deals in purchase or sale of immovable properties either as
principal or as agent in the national Capital Territory of Delhi: or
(iii) he or his spouse or any of his dependant children is a member
of any other housing society except otherwise permitted by the
Registrar.
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 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.
3. A member who ceases to be a member of a co-operative society
under sub-rule (2) shall not be entitled to exercise rights of
memberships or incur liability as member with effect from the date
referred to in sub-rule (2) but as from the date he becomes a
creditor of the co-operative society in respect of the amount due to
him on account of paid up share capital, deposit, cost of land
deposited or any other amount paid by him to the co operative
society as its member. As from the date of his ceasing to be a
member or the society under sub-rule (2), the amount standing to
his credit shall be paid to him by the co-operative society within 3
months and when the co-operative society is already under
liquidation, the amount due to him will be credited as a debt due to
a third party from the co-operative society.
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4. If any question as to whether a member has incurred any of the
disqualification referred to in sub-rule (1) arises, it shall be
referred to the Registrar for decision. His decision shall be final
and binding on all concerned. The power of the Registrar under
this rule shall not be delegated to any other person appointed to
assist the Registrar.
8. For the purpose of the present case Sub-rule (2) of Rule 25 is of
paramount importance. There is a deemed disqualification. The effect of it has
not been examined by the High Court.
9. It is, as noted above, a deeming provision. Such a provision creates a
legal fiction. As was stated by James, L.J. in Levy, Re, ex p Walton (1881 (17)
Ch.D 746)
“when a statute enacts that something shall be deemed to
have been done, which in fact and in truth was not done,
the court is entitled and bound to ascertain for what
purposes and between what persons the statutory fiction is
to be resorted to. After ascertaining the purpose full effect
must be given to the statutory fiction and it should be
carried to its logical conclusion and to that end it would be
proper and even necessary to assume all those facts on
which alone the fiction can operate.”
(See Hill v. East and West India Dock Co. 1884 (9) AC 448 , State
of Travancore Cochin v. Shanmugha Vilas Cashewnut Factory (AIR
1953 SC 333) , American Home Products Corpn. v. Mac
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Laboratories (P) Ltd 1986 (1) SCC 465 and Parayankandiyal
Eravath Kanapravan Kalliani Amma v. K. Devi (1996 (4) SCC 76).
In an oft-quoted passage, Lord Asquith stated: (All ER p. 599 B-D)
“If you are bidden to treat an imaginary state of affairs as
real you must surely, unless prohibited from doing so,
also imagine as real the consequence and incidents
which, if the putative state of affairs had, in fact, existed
must inevitably have flowed from or accompanied it. …
The statute states that you must imagine a certain state of
affairs, it does not say that having done so, you must
cause or permit your imagination to boggle when it
comes to the inevitable corollaries of that state of
affairs”.
(See East End Dwellings Co. Ltd. v. Finsbury Borough Council
1951 (2) All ER 587 (HL) )
10. “The word ‘deemed’ is used a great deal in modern legislation.
Sometimes it is used to impose for the purposes of a statute an artificial
construction of a word or phrase that would not otherwise prevail. Sometimes it
is used to put beyond doubt a particular construction that might otherwise be
uncertain. Sometimes it is used to give a comprehensive description that
includes what is obvious, what is uncertain and what is, in the ordinary sense,
impossible.”
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(Per Lord Radcliffe in St. Aubyn (L.M.) v. Attorney-General (No. 2)
1951 (2) All ER 473 , All ER p.498 F-G.]
11. “Deemed”, as used in statutory definitions is meant “to extend the
denotation of the defined term to things it would not in ordinary parlance
denote, is often a convenient devise for reducing the verbiage of an enactment,
but that does not mean that wherever it is used it has that effect; to deem means
simply to judge or reach a conclusion about something, and the words ‘deem’
and ‘deemed’ when used in a statute thus simply state the effect or meaning
which some matter or thing has - the way in which it is to be adjudged; this
need not import artificiality or fiction; it may simply be the statement of an
undisputable conclusion.” (Per Windener, J. in Hunter Douglas Australia Pty.
v. Perma Blinds 1970 (44) Aust LJ 257 .)
12. When a thing is to be “deemed” something else, it is to be treated as that
something else with the attendant consequences, but it is not that something
else (per Cave, J., R. v. Norfolk County Court 1891 (60) LJ QB 379) .
“When a statute gives a definition and then adds that
certain things shall be ‘deemed’ to be covered by the
definition, it matters not whether without that addition the
definition would have covered them or not.”
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(Per Lord President Cooper in Ferguson v. McMillan 1954 SLT
109)
13. Whether the word “deemed” when used in a statute established a
conclusive or a rebuttable presumption depended upon the context (see St.
Leon Village Consolidated School Distt. v. Ronceray 1960 (23) DLR (2d) 32) ).
“I … regard its primary function as to bring in something
which would otherwise be excluded.”
(Per Viscount Simonds in Barclays Bank v. IRC 1961 AC 509 (HL) .
14. “Deems” means “is of opinion” or “considers” or “decides” and there is
no implication of steps to be taken before the opinion is formed or the decision
is taken.
[See R v. Brixton Prison (Governor), ex p Soblen 1962 (3) All ER
641 , All ER p.669 C.]
15. Learned counsel for the appellant is right that normally when a statutory
remedy is available, the same should be availed. In the instant case that aspect
has also not been examined by the High Court. We are therefore of the
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considered opinion that the writ petition needs to be heard by the High Court
afresh to be decided keeping in view the applicable legal provision. Since no
counter affidavit had been filed by the present appellant before the High Court
we permit it to do so within a period of one month. If any rejoinder is to be
filed the same shall be filed within a period of two weeks from the date of
filing of the counter affidavit. We request the High Court to explore the
possibility of disposing of the writ petition within a period of four months by
fixing a definite date after a period of six weeks from today. Till the disposal
of the writ petition by the High Court afresh, no third party rights in respect of
the plot which is stated to have been allotted to respondent No.2 shall be
created by the appellant.
16. The appeal is allowed to the aforesaid extent with no order as to costs.
………………………………….J.
(Dr. ARIJIT PASAYAT)
………………………………….J.
(ASOK KUMAR GANGULY)
New Delhi,
February 12, 2009
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