SCA/4807/2003 1/8 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No. 4807 of 2003 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 ? ========================================================= GARGI APARTEMNTS CO OP HOUSING SOC.LTD. & 4 - Petitioner(s) Versus STATE OF GUJARAT & 13 - Respondent(s) ========================================================= Appearance : MR RAVINDRA SHAH for Petitioner(s) : 1 - 5.MRS KANAN R SHAH for Petitioner(s) : 1 - 5. GOVERNMENT PLEADER for Respondent(s) : 1 - 7. MR BS PATEL for Respondent(s) : 8 - 13. MRS RANJAN B PATEL for Respondent(s) : 8 - 11, 13, - for Respondent(s) : 0.0.0 ========================================================= CORAM : HONOURABLE MR.JUSTICE JAYANT PATEL Date : 23/04/2008 ORAL JUDGMENT SCA/4807/2003 2/8 JUDGMENT 1. The short facts of the case appears to be that one Gargi Apartment Cooperative Housing Society Ltd. (hereinafter referred to as “the Society”), which was registered in 1969 comprises of its various members. There are claims and counter claims for the membership right in the Society including the office bearers thereof. On 27.02.1969, the Society entered into Agreement to Sell with Ahmedabad Education Society for the land admeasuring 2,28,208 sq. yards @ Rs.1.10 ps. and as per the Society, it paid the earnest money of Rs.2,51,000/- pursuant to the said Agreement to Sell. 2. It is the case of the Society that on 05.06.1971, the possession agreement was also entered into. The grievance on the part of the present petitioners in the present petition is that certain persons were interested to capture rights over such land and therefore they claimed themselves as the office bearers of the Society and filed Civil Suit No. 45/97 in the Court of 6th Joint Civil Judge, SD, Ahmedabad for specific performance of the contract on the basis of the Agreement to Sell. It is the case of the petitioners that in the said Suit proceedings, those persons who are representing the Society are not duly authorised to represent in the suit proceedings. However, the matter remained there before the Civil Court and ultimately, since the claim of the petitioners was to assert right in SCA/4807/2003 3/8 JUDGMENT the management of the Society and to prohibit those who are representing as the office bearers of the Society in the suit proceedings before the Civil Court, the petitioners filed Lavad Suit No. 507/01 before the learned Board of Nominee for the declaration and the permanent injunction prohibiting the so called persons who are respondents herein from functioning as office bearers of the Society. It appears that initially, the injunction was granted and inventory was also ordered by the learned Nominee, which subsequently came to be vacated. The matter was also carried before the Tribunal and the Tribunal dismissed the revision. It is under these circumstances, the present proceedings before this Court. 3. Heard Mr. Shah for the petitioners, Ms. Patel, learned AGP for the State Authorities and Mr.Patel for respondent Nos. 8 to 13. 4. The petitioners as such has made prayer in twofold. One is against the order passed by the Nominee and it confirmation thereof by the Tribunal in the proceedings of Lavad Suit and the another is for challenging the inaction on the part of the State Authorities in not taking the proper action and in the same, the prayer is also made by the petitioners to quash and set aside the audit report for the period from 01.01.1969 to 30.06.1998, 1999-2000 and 2000- SCA/4807/2003 4/8 JUDGMENT 2001. 5. It appears that this Court pending the petition, the interim relief has been granted restraining the respondents to withdraw or compromise Special Civil Suit No.45/97 pending before the Civil Court, Ahmedabad. No other interim relief has been granted in the present petition. 6. Concerning to the challenge made by the petitioners against the order passed by the Nominee and its confirmation thereof by the Tribunal, it appears that there are concurrent findings recorded by both the lower authorities and therefore, there is no satisfactory cause for upsetting such observations made, save and except right to represent in the proceedings of Special Civil Suit No.45/97 as stated hereinafter. 7. It can hardly be disputed that in the proceedings of Special Civil Suit No. 45/97, the rights, if any, of the Society are having heavy stake and interest. Therefore, whomsoever may represent the Society irrespective of their action/dispute inter se, no office bearers of the Society in normal circumstances can be permitted to act against the interest of the Society which may result into frustrating the rights of the Society over the land in question. Of course, same shall be without prejudice to the rights and contentions of the defendants in SCA/4807/2003 5/8 JUDGMENT the aforesaid suit. I would have further considered the matter on the said aspects, however, Mr.Patel, learned counsel appearing for the respondent Nos. 8 to 13 declared before the Court that his clients are also interested in pursuing the rights of the Society over the land and therefore, the respondents Nos. 8 to 13 shall not act in any manner in the proceedings of Civil Suit No. 45/97, which may result into adversely affecting the interest of the Society qua the land in question. 8. Hence, in view of the aforesaid declaration, the interest of the petitioners shall stand sufficiently protected and there will not be any valid cause for the apprehension as shown in the petition. The only observation and direction deserves to be issued is that respondent Nos. 8 to 13 or their successor in office if any shall comply with the declaration made before this Court. 9. The aforesaid shall conclude the aspects qua the challenge made by the petitioners to the order passed by the learned Nominee and its confirmation thereof by the Tribunal. 10.So far as inaction on the part of the respondent State Authorities and for quashing and setting aside of the audit report from 1969 onwards are concerned, it appears that in the Gujarat Cooperative Societies Act itself, there SCA/4807/2003 6/8 JUDGMENT is inbuilt mechanism provided against the audit report including that of re-audit and other actions based thereupon. As per the petitioners, they raised grievance before the Authority, but it is not demonstrated as to whether the petitioners specifically applied for re-audit or not nor there is any declaration on the aspects about the cost to be borne by the petitioners for such re-audit. Therefore, if the petitioners has any grievance against the audit report, the petitioners may resort to such proceedings as available under the Cooperative Societies Act, including that of re-audit and if such an application is made, the same shall be considered and decided in accordance with law by the concerned State Authorities, after giving opportunity of hearing to all concerned including the respondents against whom the allegation is made by the petitioners that the audited report is maneuvered at the behest of respondent No.8. 11.Apart from the above, it deserves to be recorded that it is an admitted position that Lavad Suit No. 507/01 is pending before the learned Nominee. Therefore, the rights of the petitioners, if any, pertaining to the Suit proceedings and further exercise which may arise based on the documents, if any, of the audit report will be also one of the subject matter at the trial of such suit proceedings. Both the SCA/4807/2003 7/8 JUDGMENT parties will have sufficient opportunity to put forward their case and unless any re-audit is undertaken or the sufficient opportunity is given, this Court cannot record conclusion that the audited report are concocted or deserves to be quashed and set aside since they are on the bogus record or at the instance of the respondent No.8 or otherwise. It will be for the respective parties to assert their rights in the aforesaid suit proceedings before the Nominee after leading proper evidence. Even otherwise also, the learned Nominee is at the liberty to take independent view of the matter on the material, which may be available at the conclusion of the trial. Hence, as the said suit is pending, I find that it would not be a case to quash and set aside the audit report as prayed by the petitioners. Suffice it to state that the rights and contentions of both the sides in the suit shall remain open, but the same shall be subject to the observations made by this Court hereinabove in the earlier paragraphs pertaining to the ventilation of the grievance of the petitioners, if any, before the Higher Forum against the audit report under the Act. 12.With the aforesaid observations and directions, the present petition is disposed off. Rule partly made absolute. No order as to costs. SCA/4807/2003 8/8 JUDGMENT (JAYANT PATEL, J.) *bjoy