1 wp1960-11 ttm IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.1960 OF 2011 Dr.V.Thanumoorthy and Ors. .. Petitioners Vs. Navgeeta Co-operative Housing Society and Ors. .. Respondents Mr.Jagtap Shekhar and Shweta Jadhav i/b M/s.J.Shekhar and Co. for the petitioners Mr.Prashant Naik for respondent no.7 CORAM: K.K. TATED, J. DATE: 15th MARCH, 2011 P.C. 1. Heard the learned counsel for the petitioners and the learned counsel for respondent no.7. 2. The learned counsel for the petitioners states that as per order passed by this court on 9.3.11, he has already served respondent nos.1 to 6 and filed affidavit of service. 3. By this petition, under Article 226 and 227 of the Constitution of India, petitioners are challenging the order dated 5.3.11 passed by the President, Maharashtra State Co-operative Appellate Court, Mumbai in a Revision 2 wp1960-11 Application No.5 of 2011 arising out of order passed in Misc.Application No.52 of 2010 dated 24.9.10 in dispute no. CC/I/109 of 2010 pending before the Co-operative Court No.1, Mumbai allowing respondent no.7 s’ application for joining them as party respondent in dispute no.CC/I/109 of 2010. A few facts of the matter are as under: 4. The petitioner filed dispute no. 109 of 2010 before the Hon ble Co- ’ operative Court No.1 for Greater Mumbai for declaration that the process adopted by respondent no.1 to 6 for redevelopment of property of the respondent society was illegal void ab initio. They also prayed for declaration that respondent nos.1 to 6 have not followed fair, transparent and legal procedure for redevelopment of property and for setting aside the resolution dt.3.7.10 passed by the Society pertaining to redevelopment of the society s property. ’ 5. In the said dispute, respondent no.7 preferred application for joining them as party opponent to the dispute on 17.8.10. The said application was allowed by co-operative court no.1 by order dt.24.9.2010 directing petitioner to join respondent no.7 as opponent in the pending dispute. 6. Being aggrieved by the said order passed by the Co-operative court, petitioner preferred Revision Application no.5 of 2011 before the Appellate Court. The Appellate Court dismissed the said revision by order dt.5.3.11. 7. The learned counsel appearing on behalf of the petitioners submits that 3 wp1960-11 both the courts below erred in coming to the conclusion that respondent no.7 is a necessary party in a dispute between petitioner and respondent nos.1 to 6. He submits that the lower courts ought to have appreciated that the dispute is inter se amongst the society members and respondent no.1 society shall not cover the interest of the respondent no.7, since its remedy is not before the learned Co-operative court but at the most, the same may be before the Civil Court at the appropriate stage. He further submits that the lower court ignored the contentions of the petitioners that non-member cannot be a party to the litigation and none other than the aggrieved person can contest the dispute. He further submits that both the courts erred in relying upon the statement made by respondent no.7 that the MOU is executed in his favour for development of the property and he has already spent huge amount to the tune of Rs. 1,47,00,000/-. 8. The learned counsel for the petitioner submits that under section 94(3)(a) of the Maharashtra Co-operative Societies Act, 1960, respondent no.7 cannot be said to be interested person in a dispute filed by them before the Co-operative court. On this submission, the learned counsel for the petitioner submits that the application filed by respondent no.7 for joining them as party respondent in a dispute is liable to be rejected. 9. On the other hand, the learned counsel for respondent no.7 submits that respondent no.1 Society sometime in the year 2006-2007 had passed 4 wp1960-11 resolution to redevelop its property situated at Chembur, Mumbai 400 071. The said society pursuant to resolution passed in its special general meeting held on 16.9.07 had executed a Memorandum of Understanding and a limited Power of Attorney on 29.11.07 in favour of respondent no.7. He further submits that pursuant to the said MOU, respondent no.7 had paid an amount of Rs.18,27,756/- to the respondent no.1 society. He submits that Society also executed the redevelopment agreement as well as a power of attorney in favour of the respondent no.7 on 3.8.10 which has been duly stamped and registered with the Sub-Registrar, Kurla-I, Mumbai. He submits that pursuant to the said power of attorney, under the development agreement, respondent no.7 paid an amount of Rs. 73,11,024/- to the respondent no.1 Society. His contention is that respondent no.7 incurred an expenditure of Rs.1.47 crores till date towards redevelopment of the property of respondent no.1 society. In this situation, if any adverse order is passed in the dispute filed by petitioner before the Labour Court, respondent no.7 s right, title and interest will ’ be affected and therefore respondent no.7 is necessary party in the pending dispute before the Co-operative Court. 10. He further submits that as per the provisions under section 94(3)(a) of the M.C.S. Act, 1960, respondent no.7 acquired interest in the property of society and therefore, is a necessary party before the Co-operative Court in dispute no.109 of 2010. In support of his contention, he relies on the 5 wp1960-11 judgment in the matter of Chairman/Secretary, Shri Shrinath Panipuravtha Sahkari Sanstha, Dist: Pune vs. N/s.Nitin Agro Engineers and Anr. reported in 2004(4) MR 177. He particularly relies on the following observations of this court in that matter which read as under: Section 94(3)(a) postulates a situation where the Co- “ operative Court is satisfied that a person whether he is a member or otherwise of the Co-operative Society has acquired any interest in the property of a person who is a party to the dispute. In such case, the Co-operative Court may order that the person who has acquired such interest be joined as a party to the dispute and any decision that may be passed on the reference by the Court shall be binding on the party so joined. Section 94(3)(a) is obviously intended to deal with a situation where a person who is not a member of a society has nevertheless acquired any interest in the property of a person who is party to the dispute. In order to facilitate a full and final adjudication of the dispute, the Act postulates that such a person can be impleaded as a party to the proceedings.” 11. He also relies on the judgment in the matter of Nishigandh Sahaniwas Co-operative Housing Society Ltd., and Others vs. Vithal R. Saudagar & Others reported in 2004 (Supp) Bom.CR 286. The Head Note of that judgment reads as under: Maharashtra Co-operative Societies Act, 1960, Sec.94(3) “ – Power of Co-operative Court Joinder of parties Dispute – – filed Direction of Co-operative Court that respondent 1 be – joined as party and allowed respondent no.1 to delete respondent no.2 s name from dispute Challenged Held, ’ – – Will and irrevocable Power of Attorney executed in favour of respondent no.1 in respect of suit property filed on 6 wp1960-11 record. Respondent no.1 prima facie justified that he acquired interest in suit property. This entitles him to be joined in dispute. Further, respondent no.2 wanted to withdraw dispute to defeat right of respondent no.1. Hence, Co-operative Court justified in allowing respondent no.2 to withdraw from dispute and instead permitted respondent no. 1 to join himself as disputant (paras 3 & 4)” 12. The third judgment cited by the learned counsel for respondent no.7 is in the matter of Amit Kumar Shaw and another Vs. Farida Khatoon and another reported in 2005(3) Mh.LJ 330. In that case, the Apex Court held that the power of the court to add a party to the proceeding cannot be solely on the question whether he has interest in the suit property. The question is whether the right of a person may be effected if he is not added as a party. The head note A of that judgment of Apex Court reads as under: (a) Civil Procedure Code, O.1, R.10 Object Power of “ – – court to add a party to a proceeding Do not depend – solely on the question whether he has interest in the suit property. The object of Order 1, Rule 10, Civil Procedure Code is to discourage contests on technical pleas, and to save honest and bona fide claimants from being non-suited. The power to strike out or add parties can be exercised by the Court at any stage of the proceedings. Under this Rule, a person may be added as a party to a suit in the following two cases: (1) When he ought to have been joined as plaintiff or defendant, and is not joined so, or (2) When, without his presence, the questions in the suit cannot be completely decided. The power of a Court to add a party to a proceeding cannot depend solely on the question whether he has interest in the suit property. The question is whether the right of a person may be affected if he is not 7 wp1960-11 added as a party. Such right, however, will include necessarily an enforceable legal right (Paras 9 and 10).” 13. It is an admitted fact that respondent no.1 society executed the development agreement in favour of respondent no.7. Respondent no.7 stated in their application for adding as party that they have already spent Rs.1.47 crores. It shows that some interest is created in favour of respondent no.7. 14. Section 94(3)(a) of the M.C.S. Act, 1960 is very clear that if a person has interest in the property of a person who is a party to a dispute whether he is a member or not, can make an application for joining him as a party to the dispute. 15. Our High Court has taken a similar view in the matter of Chairman/Secretary, Shri Shrinath Panipuravtha Sahkari Sanstha, Dist: Pune vs. N/s.Nitin Agro Engineers and Anr. and Nishigandh Sahaniwas Co-operative Housing Society Ltd., and Others vs. Vithal R. Saudagar & Others (Supra). Therefore, I do not find any substance in the submissions made by the learned counsel for the petitioners that respondent no.7 is not a necessary party in the pending dispute between petitioners and respondent nos.1 to 6 before the Co-operative Court. 16. As the respondent no.7 has already spent more than Rs.1..47 crores and as respondent nos.1 to 6 executed development agreement in their favour, 8 wp1960-11 they are necessary party in the pending dispute. If any adverse order is passed in the said dispute, same will affect the right, title and interest of respondent no.7. 17. Considering these facts, I do not find any substance in the present Writ Petition and the same is dismissed. 18. There shall be no order as to costs. (K.K. TATED, J.)