ssm sm sm IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORDINARY ORDINARY ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION APPEAL APPEAL APPEAL NO.649 OF NO.649 OF NO.649 OF 2004 2004 2004 IN IN IN WRIT WRIT WRIT PETITION NO.2335 OF 2000 PETITION NO.2335 OF 2000 PETITION NO.2335 OF 2000 1. State of Maharashtra, 2. The Secretary, (Co-Operation) Co-operation and Textiles Department, Government of Maharashtra, Mantralaya Annexe, Mantralaya, Mumbai-400 032. 3. The Divisional Joint Registrar, (Administration) of Co-operative Societies, having their office at Malhotra House, 6th Floor, Opp. G.P.O., Mumbai-400 001. 4. The Assistant Registrar of Co-operative Societies, "F" North Ward, having his office at Malhotra House, 6th Floor, Opp. G.P.O., Mumbai- 400 001. 5. The Commissioner of Police, Bombay, having his office at Near Mahatma Phule Market, Mumbai-400 001. ...Appellants. (Orig. Respondent Nos. 1 to 5) Vs. Sion Shivneri Co-Operative Housing Society Limited, a Society registered under the Maharashtra Co-operative Societies Act, 1960, having its registered office at ( 2 ) Flat No.7, Shivnery Building, 177, Sion-Matunga Road, Sion (West), Mumbai - 400 022. ...Respondents. (Orig.Petitioners) Mr. Niranjan Pandit, A.G.P. for the Appellants. Mr. V.B.Naik, i/by M/s. S.Ashwinikumar and Co. for the Respondents. CORAM CORAM CORAM : DR. S. RADHAKRISHNAN & : DR. S. RADHAKRISHNAN & : DR. S. RADHAKRISHNAN & ANOOP ANOOP ANOOP V. MOHTA, JJ. V. MOHTA, JJ. V. MOHTA, JJ. DATED DATED DATED : 5th February, 2008. : 5th February, 2008. : 5th February, 2008. JUDGMENT JUDGMENT JUDGMENT ( PER:- ANOOP V. MOHTA, J.):- ( PER:- ANOOP V. MOHTA, J.):- ( PER:- ANOOP V. MOHTA, J.):- . The Petitioners- Original Respondent Nos.1 to 5 have preferred this Appeal against the Judgment and Order dated 10th July, 2003 passed by the learned Single Judge in Writ Petition No. 2335 of 2000, whereby the Respondents’ Writ Petition has been allowed and that resulted into restoration of registration of the Respondents society. 2. On 30/10/1948, the Government of Maharashtra, Appellant No.1, Home Department permitted the Commissioner of Police, Appellant No.5 to take 12 flats from the original owner Shri Raosaheb A. Thorat on rental basis for use as service quarters for their police officers. ( 3 ) 3. On 15/04/1950, Appellant No.5 took possession of 12 flats after construction of the building and since 1950, Appellant No. 5 has been a direct tenant of the landlord and continued to allot these 12 flats to serving police officers as rent free service quarters. This allotment is governed under the provisions of Section 31 of the Bombay Police Act, 1951 and M.C.S.Rules. 4. From the year 1966 to 1977, these flats were allotted as service quarters to 12 Police Officers. The Respondents Society’s members, 7 in number at the relevant time being occupants in respect of their respective flats in the building known as "Sion Shivneri", formed a society in question. As it is minimum requirements of requisite members were not there, they applied for exemption from compliance of the aforesaid minimum requirements. The said exemption was granted. The said property was admittedly owned by one late Raoba Thorat and others. The Appellants, Commissioner of Police admittedly tenant of the said property. The Respondents members being in service, and admittedly occupants in the said premises, entered into an agreement with the owner on ( 4 ) 15th April, 1989, to purchase the relevant property in question. The said agreement was part of the record of the Assistant Registrar. As per the said agreement, it was also decided that the members would file an application to the Registrar. Accordingly, the meeting was held. Thereafter, the application made for registration by the Chief Promoter of the Respondents society. The Respondents Society, therefore, completed the formalities of opening the bank account and other pursuant to the letter/ intimation received from the Registrar of the Co-operative society. 5. On 25/05/1989, Appellant No.5 office issued an eviction order under the Bombay Police Act against Shri Bellary, the Chief Promoter. The said eviction order was challenged by Shri Bellary in City Civil Court in Suit No. 4801/1989 wherein the Government was directed to issue fresh eviction order and not to dispose him for 7 days after issuing fresh notice. 6. On 10/07/1989, Shri Bellary again challenged the order of eviction by filing a Writ Petition No. 1978 of 1989. ( 5 ) 7. On 02/08/1989, the Hon’ble High Court dismissed the Writ Petition of Shri Bellary and granted 4 weeks time to vacate i.e. till 30/08/1989. 8. On 28/08/1989, the Assistant Registrar issued a Registration Certificate for the Society on the application made by Shri Bellary as Chief Promoter and the Society was registered as Tenants Co-Partnership Society. 9. On 28/08/1989, Shri Bellary also filed eviction suit against the Government in Small Causes Court at Mumbai. 10. On 05/12/1989, the Government cancelled the Special Exemption granted and directed the District Deputy Registrar to initiate action against the Society for cancellation of the registration which had been obtained by fraud. 11. On 02/03/1990, Appellant No. 3 issued Show Cause Notice under Section 21A of the Co-operative Societies Act to the Respondents herein (Original Petitioner) for de-registration of the Society. ( 6 ) 12. In the month of March, 1990, Writ Petition No.956 of 1990 was filed by the Society, challenging the cancellation of the exemption in favour of the Respondents (original Petitioners). 13. On 21/03/1990, the Hon’ble High Court allowed the petition and directed Appellant No.1 to issue a Show Cause Notice and hear the Respondents herein i.e. on 22/05/1990, Appellant No.2 issued show cause notice accordingly. On 07/11/1994, thereafter, the Respondents were re-heard. On 26/12/1994, after hearing and after considering all aspects, Appellant No.2 once again cancelled the exemption granted by the Government on 07/08/1989. 14. On 05/01/1995, being aggrieved by the said order cancelling the exemption, the Respondents preferred an appeal to the Minister on 05/01/1995. 15. On 06/03/1995, the Respondents also filed Writ Petition on 6th March, 1995. The Hon’ble Court once again directed that since the Respondents were not heard before the exemption was cancelled, the Respondents should be given hearing once again before cancelling the exemption granted to them. ( 7 ) 16. On 17/09/1997, Appellant No.2 passed an order after giving hearing to the Respondent Society. 17. Pursuant to the order dated 22/12/1997, Appellant No.3 commenced proceedings under Section 21A of the Maharashtra Co-operative Societies Act and gave notice to the Respondents to submit their written reply. 18. On 08/03/1999, the Appellants and the Respondents were heard from time to time and on 08/03/1999, Appellant No.3 passed an order de-registration of the Society. 19. On 24/08/2000, being aggrieved by the said order, the Respondents preferred an Appeal/Revision before the Appellant No.2. 20. On 03/10/2000, Appellant No.2 confirmed the order passed by Appellant No.3 by dismissing the Revision Application of the Respondents Society. Thus the de-registration of the Society was confirmed. 21. Being aggrieved, the Respondents filed the present Writ Petition challenging the above 2 orders ( 8 ) passed by Appellant Nos. 3 and 2 respectively. 22. On 15/12/2000, this Hon’ble Court granted stay of the impugned order and expedited the hearing of the Petition and on 10/07/2003, allowed the Writ Petition and set aside the orders of de-registration passed by Appellant No.3 on 8th March, 2000 and confirmed by Appellant no.2 on 3rd October, 2000. 23. The relevant Section for consideration are 21-A of the Maharashtra Co-Operative Societies Act, 1960 (for short, "The Societies Act") is as under:- . "21-A. 21-A. 21-A. De-registration of societies:- De-registration of societies:- De-registration of societies:- (1) If the Registrar is satisfied that any society is registered on misrepresentation made by applicants, or where the work of the society is completed or exhausted or the purposes for which the society has been registered are not served, he may, after giving an opportunity of being heard to the Chief Promoter, the committee and the members of the society, de-register the society." 24. Therefore, the important word "Misrepresentation" from the Contract Act is reproduced as under:- 18. "Misrepresentation" "Misrepresentation" "Misrepresentation" defined.- defined.- defined.- "Misrepresentation" "Misrepresentation" "Misrepresentation" means and includes- means and includes- means and includes- ( 9 ) 1) the positive assertion in a manner not warranted by the information of the person making it, or that which is not true, though he believes it to be true; 2) any breach of duty which, without an intent to deceive, gains an advantage to the person committing it, or any one claiming under him, by misleading another to his prejudice or to the prejudice of any one claiming under him; 3) causing, however innocently, a party to an agreement to make a mistake as to the substance of the thing which is the subject of the agreement. 25. The crux of the matter, therefore, is whether the Respondents got the society registered by fraud and misrepresentation. By a detailed Judgment, the learned Single Judge has quashed and set aside the order of de-registration, after considering the rival contentions as well as going through the records and basically the application filed by the Respondents-Petitioners for registration of the society. We also find that the Appellants fail to demonstrate and to prove the case of the fraud and misrepresentation as alleged and as contemplated under Section 21A of the Societies Act. The learned single Judge right in observing that "copy of the original application for registration made available by the learned Advocate for the Respondents nowhere discloses ( 10 ) that the applicants had ever claimed to be the tenants of the premises in question. Undoubtedly, what was stated by them in the application along with which Form "A" was submitted, was that they are the occupants of the respective flats and they propose to purchase and own the said flats for self-occupation. The said statement nowhere gives any indication of claim of tenancy in respect of the respective flats and that therefore there was no occasion for the registering authority to have the impression that the applicants were the tenants of the respective premises and that therefore they were seeking the registration of the society as a tenant-co-partnership society on the line with those contemplated under the MHADA Act. The finding in that regard by the revisional authority is absolutely perverse and cannot be sustained". 26. We have also noted that the Respondents-Petitioners alongwith the application submitted the basic agreement to support that they are entitled for registration of the society. The agreement with the original owner specifically dealt with the aspect of nature of their occupation. The relevant clause 4 of the agreement dated 15th April, 1989 is reproduced as under:- ( 11 ) 4. "The sale and assignment of said property shall include benefit of Vendor’s rights under the said Agreement dated 3rd June, 1982 as also benefit of the rent being received from the tenants Mr. Kamlesh Kumar Ved, Commissioner of Police and Rashmi Sheth. The Vendor agrees, undertakes and assures not to effect any change to the said tenancies and attorn the same to the Purchasers on payment of balance consideration. On attornment the Vendor shall be at liberty to continue pending suit against Commissioner of Police for recovery of arrears only." 27. This shows that the members of the Society have made every details of their occupation on record which is clear from the above para of the agreement which was part of the application for restoration. There was no demand or enquiry called for by the concerned Officer after scrutiny of the application for the registration. The presumption is always in favour of the authority one who passes the order unless proved otherwise, that the material placed on record have ( 12 ) been taken note of, while passing the order on such application and in the present case grant of registration. It is also clear that the party one who applied for registration needs to fill in the requirement of the application and not more than that unless it is specifically provided in the application to give more details. As the relevant documents and the details made available to the concerned Officer at the relevant time, the registration was granted. The registration was granted on 28/08/1989 as Tenants Co-Partnership Society. 28. In the meantime, eviction suits were filed by the Respondents and the others against the Appellants before the Small Causes Court for possession of the property being owner of the same pursuant to the registered agreement entered into by them with the original owner of the property. The said document/ sale-deed is still in existence, remained unchallenged. Therefore, at this stage, Respondents are the owner of the property. Though initially occupied the premisses as employees in service of the Appellant as part of their service condition. 29. Therefore, for the purpose of this application, ( 13 ) if they have supplied the material documents and fill the forms in accordance with law as required, the further reasoning given by the learned Single Judge in reference to the suppression of information, pertaining to the tenancy rights to the Police Commissioner is, therefore, correct. Those reasonings as reproduced below need no interference. "12. As regards the finding of the lower authority about the suppression of information pertaining to the tenancy rights of the Police Commissioner in the premises in question, neither the statutory provisions of law referred to above, nor any materials placed before this Court disclose any obligation being cast upon the applicants to disclose the tenancy rights in relation to the premises with reference to which the application is made for formation and registration of society. Undoubtedly, the Chief Promoter and six others were occupying the said premises being the allottees on account of them being in the police service and the premises were under lease with the Police Commissioner of Maharashtra. However, since the information which was required to be furnished by the applicants at the time of seeking the registration of the society, nowhere required to disclose any such ( 14 ) fact, it is not understood how the authority could jump to the conclusion that there was suppression of the said fact. The fact can be said to be suppressed when the fact is either directly or indirectly relevant or material or in some manner necessary to be considered by the authority while taking decision on the application filed for registration of the society. Once it is clear that the fact as to who is in occupation of the premises and in what capacity is not relevant for the decision on such application, the finding of the lower authority regarding suppression of the said information cannot be sustained. Since, the applicants were not required to disclose the said information in accordance with the provisions of law, mere non-disclosure of the said fact, by no stretch of imagination, can be termed as suppression of fact or information. Besides, nothing prevented the registering authority from asking the applicants to furnish specific information in relation to the nature of the occupation of the premises by the applicants and to furnish the documentary evidence in that regard, since such power is vested in the registering authority under Section 8(1) of the said Act. Being so, the said finding is also liable to be set aside." ( 15 ) 30. The submission that the Respondents without intimating to the Appellants, purchased the property in question, which they were occupying under their service condition and at the relevant time the Appellants were tenant of the premises in question of original owner from whom the Respondents have purchased the property by registered sale-deed is not correct. There is nothing pointed out that such occupants cannot form the society. There is nothing to prohibit even under the Societies Act that such person/ occupants cannot apply for registration. In absence of any specific bar, once the Respondents-Petitioners complied with the requirements and the registration of the society as granted, in the facts and circumstances of the case, we are of the view that there is no case made out of fraud and misrepresentation. Even otherwise, the grounds of fraud and misrepresentation need detailed enquiry and evidence. As we are considered with the "misrepresentation" contemplated under Section 21A of the Societies Act and in absence of any positive and substantial material on record, we see there is no case of fraud and misrepresentation made out. The order of the learned Single Judge, therefore, of allowing the Writ Petition cannot be faulted with. ( 16 ) 31. The Appellants must prove the case of fraud and misrepresentation by leading detailed evidence and material before the appropriate forum if so advised. It appears that the Appellant filed a Criminal Case under Section 409 readwith Section 34 of the Indian Penal Code against the Chief Promoter and other members of the Society, C.R. No. 90/91 and the C.R. has been pending in Metropolitan Magistrate’s Esplanade Court, Mumbai. 32. The Appellants are also at liberty to take appropriate action against the Respondents, if so desired and permitted under the service conditions, as alleged that they purchased the property without sanction or permission from the Appellants. 33. Therefore, taking all this into account, we see there is no case made out by the Appellants to interfere in the order passed by the learned Single Judge. It is well within a framework of law and the record. 34. The Appeal is, therefore, dismissed. ( 17 ) . No order as to costs. (ANOOP (ANOOP (ANOOP V.MOHTA,J.) V.MOHTA,J.) V.MOHTA,J.) (DR.S.RADHAKRISHNAN,J.) (DR.S.RADHAKRISHNAN,J.) (DR.S.RADHAKRISHNAN,J.)