*1* wp.644.11.927.sxw kps IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.644 OF 2011 Anahita Hormuzdyar Engineer. ..Petitioner -Versus- Divisional Joint Registrar and others. ..Respondents .......... Mr.Yusuf Iqbal Yusuf a/w Neville Majra i/b Yusuf & Associates, for the Petitioner. Mr.F.D’vetre, Senior Advocate with Mr.P.Colabawalla, Ms.Neha Dhru i/b Mulla & Mulla, for the Respondent No.2. Mr.S.N.Bhosale, AGP, for the Respondent No.1. .......... CORAM : S.C.DHARMADHIKARI, J. Date : 24th June, 2011. P.C.: 1 Heard. 2 Rule. 3 The Respondents are duly served and the contesting Respondent is the Respondent No.2-Society. There is affidavit in reply filed by the Respondent No.2, therefore, by consent of parties, the Writ Petition is disposed of finally at this stage itself. 4 This Writ Petition under Article 227 of the Constitution of India is directed against the order passed by the Divisional Joint Registrar, Co-operative Societies dated 25.10.2010 in Revision Application No. 227/2009. 5 By the impugned order, the Divisional Joint Registrar has set aside the order dated 15.07.2009 of the Deputy Registrar, Co-operative Societies in Appeal No.16/2009. The proceedings are under Sections 22 *2* wp.644.11.927.sxw and 23 of the Maharashtra Co-operative Societies Act, 1960. 6 The Petitioner claimed before the Deputy Registrar that the Respondent No.3 is a member of the Respondent No.2 Society and occupying Flat No.301 situate on 3rd floor of the building located at 723, Dr.Dinshaw Master Road, Parsi Colony, Dadar, Mumbai-400014. By an agreement for sale dated 02.02.2007 the Respondent No.3 agreed to sell, transfer and assign Flat No.301 and the share certificate No.1565 to the Petitioner. Thereafter, by a registered sale deed dated 08.08.2008 the Respondent No.3 sold, assigned and transferred all rights in the flat and in the share certificate held by him. In pursuance of the sale deed, an application was made for membership for admitting the Petitioner as member of the subject co-operative housing society. That application for membership has been rejected on 22.10.2008. Against this rejection, the Petitioner preferred an appeal to the Deputy Registrar and by an order dated 15.07.2009, a copy of which is at page-67 to the petition paper book, the Deputy Registrar has directed the Respondent No.2-Society to admit the Petitioner as member of the Society and records to be corrected accordingly. Aggrieved by this order of the Deputy Registrar, the Revision Application was preferred and the Divisional Joint Registrar having reversed that order and allowed the Revision Application of the Respondent No.2 Society, that this Writ Petition is filed. 7 On behalf of the Petitioner, it is contended that the Divisional Joint Registrar has exceeded his jurisdiction in law in allowing the Revision Application. The application for revision under Section 154 of the Maharashtra Co-operative Societies Act, 1960 has to be decided on a touchstone as to whether, there is apparent illegality or perversity committed by the Deputy Registrar rendering findings and recording conclusions in his order. The Divisional Joint Registrar was in error in *3* wp.644.11.927.sxw going into the merits of the controversy. It is true that the Respondent No. 2-Society has filed a suit/proceedings in the Small Causes Court against the Respondent No.3. However, the merits of that dispute cannot be gone into in limited jurisdiction of the authorities under the Maharashtra Co- operative Societies Act, 1960. Assailing the conclusions that have been arrived at by the Divisional Joint Registrar, it is contended that he could not have gone into the issues and particularly, on the nature of allotment by the Respondent No.2-Society in favour of the Respondent No.3. It is not necessary and neither permissible in law for the Divisional Joint Registrar to go into and render any opinion as to whether, the induction of the Respondent No.3 is as pure licencee or not. If the Respondent No.2- Society is giving the flat on pure licence basis and the Respondent No.3 has no right, title and interest in the premises, then, in the submission of the learned counsel for the Petitioner, that is a matter which is exclusively covered by the proceedings before the Small Causes Court. The Petitioner has been impleaded as a party therein. In such circumstances, the Divisional Joint Registrar should not have interfered with the order of the Deputy Registrar and more so because he does not find any perversity or illegality apparent on the face of record. There is no such conclusion recorded in the impugned order. Therefore, in the submission of the learned counsel appearing for the Petitioner, without prejudice to any of the rights of the parties to the proceedings which are pending in the Small Causes Court, the Respondent No.2 should have admitted the Petitioner as a member and precisely that is the direction of the Deputy Registrar which requires no interference in the revisional jurisdiction. Therefore, this Writ Petition should be allowed. 8 On the other hand, Mr.D’vetre, learned Senior Counsel appearing for the Respondent No.2-Society, has submitted that each of the *4* wp.644.11.927.sxw conclusions that are reached by the Divisional Joint Registrar are based on the records and documents produced before him. Inviting my attention to the affidavit in reply filed in this Writ Petition and annexures thereto including the bye-laws, he submits that the Society has been formed under the 1912 Co-operative Societies Act. It has its own bye-laws. These bye-laws are made because the Society has been formed to render assistance to the indigent members of the Parsi community. The Society provides housing accommodation to such members. Apart from the requirement stipulated for becoming a member, additionally the bye-laws make it clear that he/she is permitted to occupy the flat which is allotted. There is no question of any interest being created in the premises. That the nature of arrangement is such that the Society does not have to initiate any legal proceedings to evict persons who do not require or wish to occupy the allotted premises. The premises have to be surrendered and thereafter, they can be allotted to other needy person in the community. Such being object and purpose for which the Society has been formed and the nature of documents in favour of the Respondent No.2 making the same very clear, then, Respondent No.3 could not have inducted the Petitioner. Once the Society finds that the Respondent No.3 has exceeded his authority given under the allotment agreement dated 25.06.1981 and has violated the terms and conditions thereof, then, any transaction entered into by him is not binding and need not be honoured or accepted by the Society. Precisely for this reason, the Society refused to accept the Petitioner as a member. Mr.D’vetre has invited my attention to the allotment agreement and the loan agreement and particularly the clauses therein which clarify that the arrangement does not confer any right in respect of the flat and share in favour of the Respondent No.3. Mr.D’vetre has invited my attention to the bye-laws and has contended that in any *5* wp.644.11.927.sxw event the transfer of flat by the Respondent No.3 cannot be to any outsider or stranger, but only to member of the Society. Admittedly, the Petitioner is not a member of the Society or a family member of the Respondent No.3. In such circumstances, the allotment being personal does not confer any right in favour of the Respondent No.3. If he had no such right or even the limited right has not been transferred in terms of the bye-laws, then, the Society is not obliged to accept the Petitioner as a member. In these circumstances and bearing in mind the fact that several such applications would be made and there will be tendency to induct outsiders without concurrence and approval of the Society that this Court should not interfere with the order under challenge, but dismiss the Writ Petition. 9 With the assistance of the learned counsel appearing for the parties, I have perused the petition and annexures thereto, so also, the affidavit in reply and other documents to which my attention was invited. It is clear from perusal of the same that the Petitioner relies upon the agreement as well as the sale deed. The Respondent No.3 made an application to the Society on 24.09.2008 and requested that the premises be transferred in the name of the Petitioner. The transfer forms were annexed to the application, so also, xerox copy of the sale deed and the relevant declaration. The Petitioner has counter signed this application. On this application, a communication was received and is dated 22.10.2008 wherein the Society informed the Respondent No.3 that without prejudice to the RAE Suit No.412/691/2005 for eviction pending against the Respondent No.3, he has been informed that the matter was placed before the Managing Committee at its meeting held on 16.10.2008 wherein the request contained in his letter was rejected and the reasons were recorded in the resolution. According to Mr.D’vetre, the reasons are *6* wp.644.11.927.sxw on the same lines as the contentions and statements in the affidavit in reply. 10 Upon this rejection, the Petitioner approached the Deputy Registrar. The Deputy Registrar, after giving notice to the Petitioner and the Society, heard them at length and observed that the Respondent No.2 is covered by the Maharashtra Co-operative Societies Act, 1960 and the application invokes Sections 22 and 23 thereof. The Deputy Registrar held that it is admitted position that the membership of the Respondent No.3 has not been challenged by the Respondent No.2-Society. The Petitioner has complied with the provisions laid down under Sections 22 and 23 of the Maharashtra Co-operative Societies Act, 1960. The Petitioner is additionally from the same Parsi community. The Petitioner has purchased the shares and incidental benefits and rights to use and occupy the subject flat vide the registered agreement. Merely because the proceedings are pending before the Small Causes Court, the Respondent No.2-Society could not have rejected the application of the Petitioner. There is no prejudice caused to the Petitioner because the Petitioner is also a party to the pending proceedings in the Small Causes Court. Ultimately, the Petitioner will have to abide by the orders in the said proceedings and subject to the legal rights of all parties, the application can be granted. 11 The Divisional Joint Registrar while disturbing these findings of fact has held thus:- “I observe that:- 1. The Respondent No.3 had allotted flat 301 on plot No. 723 by Applicant Society on leave and license basis as per Agreement dated 25.06.1981. 2. According to Applicant Society all the buildings are owned by them and they only give flats on rental basis. 3. The Applicant Society had constructed the building and gave them on rent to needy members of Parsi community *7* wp.644.11.927.sxw some of whom are shareholders of the Society and some of them are not shareholders of the Society. 4. Applicant Society raised funds for construction of building by loans from members and allottees. 5. There is no evidence on record to show that the Applicant Society sold the flat No.301 on plot No.723 to the Respondent No.3. 6. Agreement dated 25.06.1981 between Respondent No.3 and Applicant Society is for leave and license and tenancy. 7. The Applicant is harping on classification of the Society. But, it should be noted that this Society is registered prior to commencement of MCS Act, 1960. At that time according to circumstances objectives and working is formulated. Now this Society is fully under MCS Act, 1960. This will not force to alter their characteristic and objective. 8. If this Society was giving houses on leave and license basis then now occupier cannot claim as a legal owner. The documents executed between the Society and occupiers on leave and license basis do not give such automatic right to them. 9. In light of above observations, the Respondent No.1 cannot claim membership on the basis of agreement for sale of premises on leave and license basis. 10. I am convinced that impugned order needs to be quashed.” 12 A perusal of what has been observed by the Divisional Joint Registrar indicates that he has merely set out the facts, but has not given any reasons other than holding that there is no evidence on record to show that the Respondent No.2-Society sold the flat to the Respondent No.3. He commented that the agreement dated 25.06.1981 between the Respondent No.3 and the Respondent No.2-Society is of leave and licence and not tenancy. There is no support in law for his observation and conclusion that Respondent No.2-Society which is covered by the Maharashtra Co-operative Societies Act, 1960, has peculiar characteristic *8* wp.644.11.927.sxw and objective. There has to be logical conclusion based on these observations, namely, that the law gives such Society a right which empowers it to reject the application even if it meets the requirement of Sections 22 and 23 of the Act. In the entire order and reasoning of the Divisional Joint Registrar, there is no finding that the Deputy Registrar’s conclusion that the Petitioner has complied with Sections 22 and 23, is in any way erroneous or perverse. The Divisional Joint Registrar has merely made observations on the basis of the submissions made by the Society, which was Applicant before him. The Divisional Joint Registrar was required to apply his mind and to come to a conclusion as to whether, there is any perversity or illegality in the order impugned before him. He does not record any such findings. It is not that mere presence of these words in the order is sufficient. Ultimately, the Revisional Authority acting under the Act performs a definite function to correct the irregularity in the proceedings by calling for records from the subordinate authority. The Act has conferred the power under Section 154, which reads thus:- “154. Revisionary powers of State Government and Registrar:- (1) The State Government or the Registrar, suo motu or on an application, may call for and examine the record of any inquiry or proceedings of any matter, other than those referred to in sub-section (9) of section 149, where any decision or order has been passed by any subordinate officer, and no appeal lies against such decision or order for the purpose of satisfying themselves as to the legality or propriety of any such decision or order, and as to the regularity of such proceedings. If in any case, it appears to the State Government, or the Registrar, that any decision or order so called for should be modified, annulled or reversed, the State Government or the Registrar, as the case may be, may, after giving the person affected thereby an opportunity of being heard, pass such orders thereon as to it or him may seem just. (2) Under this section, the revision shall lie to the State *9* wp.644.11.927.sxw Government if the decision or order is passed by the Registrar, the Additional Registrar or a Joint Registrar, and to the Registrar if passed by any other officer. (2A) No application for revision shall be entertained against the recovery certificate issued by the Registrar under section 101 unless the applicant deposits with the concerned society, fifty per cent, amount of the total amount of recoverable dues. (3) No application for revision shall be entertained, if made after two months of the date of communication of the decision or order. The revisional authority may entertain any such application made after such period, if the applicant satisfies it that he had sufficient cause for not making the application within such period. (4) The State Government may, by order, direct that the powers conferred on it by this section shall, in such circumstances and under such conditions, if any, as may be specified in the direction, be exercised also by an officer of the rank of Secretary to Government.” 13 A bare perusal of this provision would indicate that the Divisional Joint Registrar was obliged to satisfy himself as to legality or propriety of the decision of the Deputy Registrar and legality of the proceedings before him. The purpose of such jurisdiction by now is well settled. In these circumstances and finding that the Divisional Joint Registrar has exceeded his jurisdiction and has taken into account certain aspects and factors which have no bearing on the issue of membership, that I am constrained to set aside his order. The impugned order is patently erroneous and contrary to the settled legal provisions of law. Ultimately, while discharging their functions and exercising the powers under Sections 22 and 23, the authorities do not perform any adjudicatory role, they do not decide any dispute on the right, title and interest in the immovable property, but they decide the issue of applicability of these Sections. Whether the ingredients thereof are satisfied or not and all that *10* wp.644.11.927.sxw can be directed is that the Society should admit a particular person as member. While discharging that function and exercising such powers, the observations made, in no way affect the pending proceedings on the issue of right, title and interest of the parties. Neither the Deputy Registrar or the Divisional Joint Registrar or the Society can decide the issue of title to the property. These matters including the rights of the parties to the property are for the competent courts to adjudicate and decide. That is settled principle. Therefore, subject to such adjudication, the parties including the Society can be directed to abide by appropriate directions. 14 For the aforementioned reasons, this Writ Petition succeeds. Rule is made absolute by quashing and setting aside the order dated 25.10.2010 passed by the Divisional Joint Registrar and restoring that of the Deputy Registrar dated 15.07.2009. However, it is clarified that none of the observations made in the orders passed by the Deputy Registrar and the Divisional Joint Registrar shall affect the pending proceedings in the Court of Small Causes. The Petitioner, so also, the Respondent No.3 are parties to the said proceedings. Both of them will have to abide by the outcome of the said proceedings. Pending the adjudication and making the order subject thereto, the Petitioner’s application for membership is granted. However, it is clarified that the order does not preclude all parties from raising appropriate pleas and contentions and the Small Causes Court shall decide the suit without being influenced by the outcome of the application before the Deputy Registrar. 15 Needless to clarify that the apprehension that the Petitioner will claim independent rights in the flat on the basis of the agreement for sale and the sale deed and the order admitting him as member of the Society; is not well founded. The agreement for sale and the sale deed, apart from seeking direction to admit and enroll the Petitioner as member, *11* wp.644.11.927.sxw by itself cannot confer any right in the property as the proceedings in the Small Causes Court against the Respondent No.3 are pending. The document that has been propounded by the Petitioner is claiming right through the Respondent No.3. Now the Petitioner has been impleaded in the proceedings before the Small Causes Court, he will have to prove the case set up before that Court independently and without relying upon the order passed in his application for membership. For these reasons, there is no need to clarify anything about the title to the property. 16 At this stage, Mr.D’vetre prays for stay of this order. This request is opposed by the Petitioner. With clarifications that have been given and the request being granted already by the Deputy Registrar on 15.07.2009 which order was set aside erroneously by the Divisional Joint Registrar, the request for stay is refused. 17 Rule made absolute accordingly. No costs. (S.C. Dharmadhikari, J)