1 1432 IN THE HIGH COURT OF JUDICATURE AT BOMBAY. APPELLATE JURISDICTION. APPEAL FROM ORDER NO. 1432 OF 2010 Ravi Kiran Aggarwal of Mumbai, Age; 62 years Adult Indian inhabitant residing at 18th Floor, (Pent House) Villa Orb, Darabsha Lane, Opposite Palm Beach School, Off.Napean Sea Road, Mumbai 400 026. ... Appellant. V/s. 1. Matadin Kejriwal of Mumbai, Indian Inhabitant residing at 7B/14-15, Sangeeta, Juhu Road, Mumbai 400 049. 2. Bhavesh Shah Adult, Indian Inhabitant residing at C/o. Shree Krishna Hindu Merchants 44, Belle Vue, Chowpatty Road, Mumbai 400 004. 3. Rajinder K. Jain of Mumbai, India Inhabitant residing at North Avenue, Santacruz (W), Mumbai and also at C/o. Shree Krishna Hindu Mechants 44, Belle Vue, Chowpatty Road, Mumbai 400 004. 4. Nitin Dossa Adult, Indian Inhabitant having his place Business at Dossa Medicare Ltd. Nanabhai Mansion, 4th Floor, Sir P.M.Road, Fort, Mumbai and also at Shree Krishna Hindu Mechants, 2 1432 44, Belle Vue Chowpatty Road, Mumbai 400 004. 5. P.M.Rungta Adult, Inhabitant residing at Rungta House, Rungta Lane, 68 A Napean Sea Road, Mumbai 400 006 and also at C/o.Shree Krishna Hindu Mechants, 44, Belle Vue Chowpatty Road, Mumbai 400 004. 6. Shree Krishna Hindu Mechants Club, 44, Belle Vue Chowpatty Road, Mumbai 400 004. 7. S.Subramaniam, adult residing at Mt.Pali Apartments, 10-A, Pali Mala Road, Bandra (W), Mumbai 400 050. 8. Ms.Kajal Anand, adult Hon.Secretary of Shree Krishna Hindu Mechants Club, Residing at 12, Mayfair Bldg., Veer Nariman Road, Mumbai 400 020. 9. Maninder Singh, Jt.Secretary, Residing at D-102, Poornima Apartments, 23, Pedder road, Mumbai 400 026. 10. S.M.Shah, residing at 144-A, A Navshanti Nagar, 98, Napean Sea Road Mumbai 400 006. 11. Ashok Mehta, residing at 10-B, Lands End Building. 29, Dongri Road, Malabar Hill, Mumbai 400 006. 12. Anita Singh Residing at Park House, 2nd Floor, 81, Nathalal Parekh Marg, Colaba 3 1432 Mumbai 400 005. 13. Rakesh Malhotra, 30, Sagar Kunj, 78, Napean Sea Road, Mumbai 400 006. 14. Srichand Asrani, 4th Floor, Betry apartments, Turner Road, 146, Povery Road, Bandra, Mumbai 400 050. 15. Govind U. Melwani, 1-B, Alatamount Road, Mumbai 400 026. 16. Rekha Punjabi, adult, residing at 4, Hanuman Sharan, Bomnji Petit Road, Warden Road, Opp.Parsi General Hospital, Mumbai 400 026. 17. Rajni Anand, residing at 12, Mayfair Building, Veer Nariman Road, Mumbai 400 020. 18. Taher Adamali Adenwala, Residing at 82-B, Jolly Maker Apartments, `I’, Cuffee Parade, Mumbai 400 005. 19. Gehimal Jassumal Jethani, Residing at Flat No.8, Padam II, 4th Floor, Peddar Road, Mumbai 400 026. 20. Hemendra M. Shah, residing at P-1, Patropolis, 157, S.Bhagat Singh Road, Colaba, Mumbai 400 036. 21. Shamji H. Gogre, residing at 123-124, New Sarnath B, Sophia College Lane, 4 1432 B.D.Road, Mumbai 400 026. ... Respondents. Atul Rajadhyaksha, Senior Advocate with Ms.Fereshta Sethna, Aagar Doshi and Nagendra Dube for the appellant. Vivek Phadke i/b. M/s.Kaikini Phadke & Associates for respondent Nos.1 to 3. Hemang Jariwala i/b. V.Deshpande & Co. for respondent No.6. A.Y.Sakhare, Senior Advocate with Kalpesh Joshi for respondent Nos.8, 12 and 15 to 21. CORAM: R.M.BORDE, J. RESERVED ON : 1st December 2011. PRONOUNCED ON : 21st December 2011. JUDGMENT : In this appeal from order, the appellant- original plaintiff is taking exception to the order passed by the Judge, City Civil Court, Greater Bombay on 23rd November 2010 rejecting Notice of Motion No. 2363/2010 in Suit No.1783/2010 presented by the plaintiff. The plaintiff prayed for grant of order of injunction staying the effect and implementation of the resolution dated 2nd August 2010 passed by the Managing Committee of defendant No.6 expelling the plaintiff from the membership of defendant No.6. The plaintiff also claimed an order of injunction restraining defendant Nos.1 to 3, defendant No.6 and its managing committee i.e. defendant Nos.4, 5 and 7 to 21 or any other 5 1432 members or their representative, servants, agents, assigns and successors in office from interfering in any manner directly or indirectly with the plaintiff's membership of defendant No.6- Club as well as plaintiff's entry, exit and access to the premises and facilities of defendant No.6 except in accordance with law. 2. The defendant No.6 is an unregistered club and the plaintiff claims to be a life member of the said club. As a result of decision of the enquiry committee, the plaintiff was suspended from membership of defendant No.6- club and, ultimately, he has been expelled from the membership of the club by its managing committee vide resolution dated 2nd August 2010. The plaintiff has claimed declaratory relief as regards action of expulsion from membership. The prayers contained in the plaint are as quoted below: a) this Hon’ble Court be pleased to declare that the minutes of the meeting of the Disciplinary Enquiry Committee held on 25/06/2010 and 9/07/2010 as recorded by the Disciplinary Enquiry Committee are false and fabricated and are of no legal effect whatsoever. b) this Hon’ble Court be pleased to declare that the action of the Disciplinary Enquiry Committee in arbitrarily and mala fide closing the proceedings without hearing Plaintiff is not only contrary to the provisions of the Rules, Regulations and Constitution of Defendant No.6 but also contrary to the principles of natural justice and is accordingly, null and void and of no legal effect whatsoever; c) this Hon'ble Court be pleased to declare that the Report dated 12/07/2010 prepared by 6 1432 Defendant Nos.1 to 3 is prepared in a manner which is not only contrary to the provisions of the Rules, Regulations and Constitution of Defendant No.6 but also contrary to the principles of natural justice and is accordingly, null and void and of no legal effect whatsoever; d) this Hon’ble Court be pleased to declare that show cause notice dated 19/07/2010 issued by the Managing Committee of Defendant No. 6 has been issued in violation not only of the provisions of the Rules, Regulations and Constitution of Defendant No.6 but also contrary to the principles of natural justice and is accordingly, null and void and of no legal effect whatsoever; e) this Hon’ble Court be pleased to declare that the resolution dated 19/07/2010 passed by the Managing Committee of Defendant No.6 suspending the membership of Plaintiff is violative not only of the Rules, regulations and Constitution of Defendant No.6 but also principles of natural justice and is accordingly, null and void and of no legal effect whatsoever; ee) this Hon’ble Court be pleased to declare that the resolution of expulsion of Plaintiff passed by the Managing Committee of Defendant No. 6 at its meeting held on 02.08.2010 is in violation of principles of natural justice, rule and regulations of the Defendant No.6 club and is accordingly illegal, null and void and of no legal effect. f) this Hon’ble Court be pleased to pass an order setting aside the Constitution of the present Disciplinary Enquiry Committee i.e. Defendant Nos.1 to 3 on the ground of bias and disband the same; 7 1432 g) this Hon’ble Court be pleased to pass an order and injunction restraining Defendant Nos.1 to 3 by an order and permanent injunction from proceeding with the enquiry relating to the Show Cause Notice dated 06/10/2008 on account being biased against Plaintiff; h) This Hon’ble Court be pleased to pass an order and injunction restraining Defendants from proceeding with the enquiry relating to the Show Cause Notice dated 06/10/2008 on account of being biased against Plaintiff and/or taking any step in furtherance of the Show-Cause Notice dated 19/07/2010; hh) this Hon’ble Court be pleased to pass an order and injunction quashing and setting aside the resolution of expulsion of Plaintiff passed by the Managing Committee of Defendant No.6 at its meeting held on 02.08.2010. i) This Hon’ble Court pass an order and injunction restraining Defendants from holding any meeting of the Managing Committee in relation to or in connection with the Show Cause Notice dated 06/10/2008; j) this Hon’ble Court be pleased to pass an order and mandatory injunction directing Defendant No.6 and/or its Managing Committee i.e. Defendant Nos.4 & 5 and Defendant No.7 to 21 to appoint a retired High Court Judge or any other person regarded as suitable by this Hon’ble Court to conduct the enquiry relating to the Show Cause Notice dated 06/10/2008; k) that pending the hearing and final disposal of the Suit, this Hon’ble Court be pleased to pass an order and injunction staying further 8 1432 proceedings in the said Show Cause Notice dated 6/10/2008 and the Show Cause Notice dated 19/07/2010; and l) that pending the hearing and final disposal of the Suit, this Hon’ble Court be pleased to pass an order and injunction staying the effect and implementation of the resolution dated 19/07/2010 passed by the Managing Committee of Defendant No.6 suspending the membership of Plaintiff; ll) that pending the hearing and final disposal of the Suit, this Hon’ble Court be pleased to pass an order and injunction staying the effect and implementation of the resolution dated 02.08.2010 passed by the Managing Committee of Defendant No.6 expelling Plaintiff from the membership of the Defendant No.6. m) that pending the hearing and final disposal of the Suit, this Hon’ble Court be pleased to pass an order and injunction restraining Defendant Nos.1 to 3, Defendant No.6 and its Managing Committee i.e. Defendant Nos.4 & 5 and Defendant No.7 to 21 or their respective servants, agents, assigns and successors in office by an order and injunction from interfering in any manner, directly or indirectly with Plaintiff’s membership of Defendant No.6 as well as Plaintiff’s entry, exit and access to the premises and facilities of Defendant No.6 except in accordance with law; and n) That pending the hearing and final disposal of the suit this Hon’ble Court be pleased to pass an order and mandatory injunction directing Defendant No.6 and/or its Managing Committee i.e. Defendant Nos.4 & 5 and Defendant No.7 to 21 to appoint a retired 9 1432 High Court Judge or any other person regarded as suitable by this Hon’ble Court to conduct the enquiry relating to the Show Cause Notice dated 06/10/2008 3. The trial Court has turned down the notice of motion presented by the plaintiff seeking interim injunction restraining defendants from interfering with his entitlement to act as a member of the club. The trial court has observed that there are many contentious issues involved in the suit and unless those are gone into, at the interlocutory stage, the relief as claimed by the plaintiff which is in the nature of final relief cannot be granted. 4. I have heard the arguments advanced by learned counsel appearing for the respective parties. 5. It is vehemently contended by learned senior counsel appearing for the appellant that not only the enquiry committee and the managing committee of the club but even the trial Court has completely ignored the fact that there was a reply presented by the appellant to the show cause notice dealing with the allegations made against him and the said reply has not at all been considered either by the enquiry committee or the trial Court. The enquiry committee as well as the managing committee and the trial Court have completely overlooked the fact that the reply was on record and they have proceeded on erroneous assumption that there was no reply filed by the appellant. It is also contended that the copy of the report of the disciplinary committee was not delivered to the appellant. It is, thus, contended that there is breach of the principles of natural justice by the 10 1432 committee while conducting enquiry and directing expulsion of the appellant from the membership of the club. The order passed by the managing committee being in ignorance of the principles of natural justice and the trial Court having failed to take into account that there was, in fact, reply tendered to the show cause notice by the appellant, the notice of motion tendered by the appellant for grant of interim relief ought to have been allowed by the trial court. 6. It cannot be controverted that respondent No.6 is an unregistered association. The admission and expulsion of the members of the association is governed by the rules framed by the association in that regard. In an unregistered association, the matters relating to admission and expulsion of the members are essentially governed by the contract and in the instant matter as per the rules governing the admission and expulsion. The appellant has agreed to abide by the rules and regulations and agreed to be bound by the regulations and, therefore, it has to be seen whether the expulsion of the appellant from the membership of the club is in consonance with the rules or not. The rule governing exclusion of member and suspension is recorded in rule 13 of the rules of association whereas rule 15 of the rules provides for a remedy of appeal against the order of expulsion. Rules 13 and 15 of the rules are quoted as below: 13. Exclusion of the Member and Suspension and Expulsion of the Members. A. If any Member refused to accept (an to approve) these Rules, Regulations and Bye Laws or any of the Resolution or he does not rare to accept/ and approve) them and in the opinion of the Managing Committee, 11 1432 if any of the Members found guilty of misbehavior or of initiating false and wrong move either within the premises of the Club or outside the premises because of which there is a possibility of putting the unit of the Club in danger or of creating disturbance and causing interruption therein or disturbing or hindering the honour, prestige, reputation and stableness of the Club or for any other manner whatsoever, then, the Managing Committee can exclude the Membership of the said Member for a period of time as decided by the Managing Committee or can impose Bahisakar (Suspension) from entering into the premise of the entire building of the Club or into any part thereof or from making use thereof upon the said Member or can impose Bartaraf (Suspension) as decided by the Managing Committee in its discretion (and will) by passing resolution to that effect. But as stated hereinabove, at least two third Member from out of the Members who have remain present in the Meeting of the Managing Committee should have given their vote in favour of the matter of the Resolution of exclusion and in the matter of the Resolution of suspension of the Membership of the said Member at least three fourth Members from out of the members who have remain present in the Meeting of the Managing Committee should have given their Vote in favour of the matter of the Resolution of expulsion of the Membership of the said Member. B. Such Member should be given a Notice of the Meeting in which the discussions and deliberations in the Matter of the aforesaid Resolution at least 7 days in advance prior to the convening of such Meeting and such 12 1432 Member will have right to give explanation or defence either orally or in writing as found proper by the said Member. C. During this period of time, the Managing Committee can suspend the Membership of such Member from the Club till the time the deliberations of such Resolution as mentioned hereinabove are continuing and such Resolution as mentioned hereinabove are continuing and such Resolution is either passed or rejected. D. If the Resolution of suspension is rejected, then, in that case hence the Managing Committee shall have authority and powers to initiate such steps and proceedings to pass the Resolution for excluding (Exclusion) such Member or for suspending him form the Club or any other steps as found proper and reasonably by the Managing Committee. E. If the Resolution for excluding the Member as mentioned hereinabove is passed that means he is excluded in such a manner, then, he shall not have any rights of making any tupe of use of building of the Club of getting any supplies or of implementing any of the mutual right amongst the Members even as the Guest during the period of time for which he is excluded. Inspite of the same, he will be responsible to make payments of the amounts found due and payable by him including the amounts of the subscription etc. One who commits defaults (Defaulter). 14. ..... ..... ..... ..... ..... ..... ..... 15. Appeal restriction 13 1432 An Appeal against the decision in any of the matters against the Member arrived by the Managing Committee on the basis of the powers, authorities and discretion by and through these Rules, Regulations and any Bye Laws vested with and specified in the Managing Committee. But if any Member is expelled then in the said Matter, he shall have rights for making a Written Application with the signatures of at least 21 Members (excepting Honorary Members) for convening an Extra Ordinary Meeting of the Club addressed to the Managing Committee. And in such an Extra Ordinary Meeting he can prefer an Appeal against the resolution of his expulsion that is passed against him before such Extra Ordinary Meeting. Such Written Application is required to be made within a period of 7 Days from the Date of the passing of the Resolution of the expulsion. The Managing Committee will convene such Extra Ordinary Meeting withing a period of 60 Days upon the receipt of such Written Application. As to whatever Resolution is passed by minimum ¾ Members of the Members who remained present in this Extra Ordinary Meeting, the same shall be treated as final in the Matter of the Resolution of the Expulsion and the same shall be binding upon all persons (and concerned parties). 7. Rules provide that the managing committee can exclude the member for a period of time as decided by the managing committee or impose Bahisakar (suspension) or can impose Bartaraf (suspension) as decided by the managing committee in its discretion by passing resolution to that effect. Rules also provide that at least 2/3rd members out of members present and voting in the meeting of the managing committee if cast their vote in favour of resolution for exclusion or for 14 1432 suspension, membership of the member can be suspended or he can be expelled by 3/4th members out of members who are present in the meeting. Clause (b) of rule 13 provides for issuance of notice of the meeting in which discussion or deliberation of the matter of the aforesaid resolution would be taken up at least seven days in advance and the member shall have right to give explanation or defence either oral or in writing. Rule 15 of the rules provides for tendering appeal to the general body of the club. The expelled member shall have right to make a written application with signatures of at least 21 members for convening extra ordinary meeting of the club and in such extra ordinary meeting he can prefer an appeal against the resolution of his expulsion. A written application is required to be made within a period of seven days from the date of passing resolution of expulsion and the managing committee is required to convene extra ordinary meeting within sixty days upon the receipt of such written application. A resolution would be passed by minimum 3/4th members attending the extra ordinary meeting the same shall be treated as final and it would be binding on all the persons. Thus, a peculiar procedure has been provided in respect of exclusion of member as well as consideration of the appeal by the extra ordinary general meeting. 8. In the instant matter, the appellant, without availing the remedy of appeal has approached the City Civil Court by presenting suit and has also sought stay to the resolution of his expulsion. It is to be noted that the rules governing the admission and expulsion of the member framed by the club will govern the field and any deviation therefrom even if the rules appear to be harsh or unjust would not be permissible. It is argued that a preliminary objection was raised in 15 1432 respect of entertainability of the suit on the ground of availability of remedy of appeal. However, the said objection was overruled and the suit was held to be entertainable. It would be a different matter to hold the suit as entertainable but that itself may not be a criteria for grant of interim relief. Reliance can be placed on the judgment in the matter of T.P.Daver v. Lodge Victoria No.363, S.C.Belgaum, 1964 SCR 1. The Apex Court in the aforesaid judgment has observed thus: “The source of the power of associations like clubs and lodge to expel their members is the contract on the basis of which they become members. This principle has been restated by Lord Morton in Bonsor v. Musicians' Union, (1956) A.C. 104, 127. There, one Bonsor, who became a member of a trade union, was expelled. In that context Lord Moron observed: “When Mr.Bonsor applied to join the respondent union, and his application was accepted, a contract came into existence between Mr.Bonsor and the respondent, whereby Mr.Bonsor agreed to abide by the rules of the respondent union, and the union impliedly agreed that Mr.Bonsor would not be excluded by the union or its officers otherwise than in accordance with the rules”. This contractual origin of the rule of expulsion has its corollary in the cognate rule that in expelling a member the conditions laid down in the rules must be strictly complied with. In Maclean v . The Workers Union, (1929) 1 Ch. 602, 623, the contractual foundation of the power is described thus: “In such a case as the present, where the tribunal is the result of rules adopted by persons who have formed the association 16 1432 known as a trade union, it seems to me reasonably clear that the rights of the plaintiff against the defendants must depend simply on the contract, and that the material terms of the contract must be found in the rules”. Proceeding on that basis, the learned Judge observed: “It is certain, therefore, that a domestic tribunal is bound to act strictly according to its rules and is under an obligation to act honestly and in good faith.” The same idea was expressed by the Calcutta High Court in Ezra v. Mahendra Nath Banerji, I.L.R. (1946) 2 Cal. 88, 109 thus: “..........Where the rule provides in any particular respect that some condition must be fulfilled, then that condition must be strictly complied with, since the power of expulsion is itself dependent on the terms of the rule.” The next question is whether the doctrine of strict compliance with the rules implies that every minute deviation from the rules, whether substantial or not, would render the act of such a body void. The answer to this question will depend upon the nature of the rule infringed; whether a rule is mandatory or directory depends upon each rule, the purpose for which it is made and the setting in which it appears..........” 9. In the instant matter, the enquiry has been conducted in consonance with the rules framed by the association. The appellant was given seven day notice as required by the rules to submit his say before the meeting of the managing committee. The charges were 17 1432 made known to the appellant and the enquiry committee, has dealt with charges leveled against him. If the appellant is not satisfied with the decision of the managing committee, under the rules framed by the club, it was open for him to avail the remedy of appeal and approach the appellate authority which has not been done by the appellant. The rules of the club provide that if 3/4th amongst the members of the general body of the club vote in favour of the appellant, he is entitled to retain his membership. The procedure, according to the appellant, may he harsh or it may even be unjust but while consideration of request for admission