Case: M/S Electrical Cable Development Association Vs. M/S Arun Commercial Premises Cooperative Housing Society Lt

Court that the appellant-Company is a distinct legal entity which came into existence in 1976 and is in occupation of suit premises without any agreement of leave or licence in incorrect inasmuch as the appellant is only a successor to the two un-registered bodies referred to earlier; and (3) that the finding recorded by the appellate court pursuant to the directions issued by this Court on 20th of August, 1991 are not correct. 4. Section 91 of the Act provides for raising a dispute inter alia touching upon the business of a cooperative society. When a question was raised as to where a society builds houses for the members and such members let out the premises, whether it would be within the scope of business of the society, this Court in O.M. Bhatanagar v. Ruki Bai, 1982(2) SCC 244 : 1982(2) RCR 54, answered the same. It was held that if the business of the Society is to construct or buy houses and let them out to its members, such letting out would form part of its business. A society formed with the object of providing accommodation to its members which is its normal business activity and has to ensure that the premises are in occupation of its members in accordance with the bye-laws framed by it rather than of a person in unauthorised occupation as it is the concern of the members who let it out to another under an agreement to leave and licence and wants to secure possession of the premises for his own use after the termination of the licence. Therefore, a claim by the Society together with such member for ejectment of a person who was permitted to occupy, upon the revocation of a licence, is a dispute falling within Section 91(1) of the Act. The same view has been reiterated by this Court in Sanwarmal Kejriwal v. Vishwa Cooperative Housing Society Ltd. and others, (1990) 2 SCC 288. Therefore, it would not be open to the appellant now to contend that the proceedings before the authorities functioning under Section 91 of the Act would be barred notwithstanding the proceedings filed by respondent No. 2 before the Small Causes Court. As held by this Court in the aforesaid decisions the proceedings under the Act could be maintained and, therefore, we are of the view that the first contention raised by Shri Rohtagi deserves to be rejected. 5. Plethora of material was placed before the authorities and we are also taken through the same to show that there was in existence an unregistered body known as M/s Electrical Cable Development Association and also M/s Indian Cable Makers Association, its predecessor. However, there is no material on the record to show that the appellant is the successor to such association. We have also carefully gone through the Memorandum of Association and the Articles of the appellant-Company to find out whether in any form the unregistered body has converted itself into a registered body as a Company. On the other hand, what is stated in clause 3(a) in regard to membership is as follows :- "3(a) Every person who shall be a member of the unregistered association known as "Electrical Cable Development Association" at the date of registration of this Association shall be entitled as of right to be admitted as a member of this Association on his submitting a formal application addressed to the Secretary of the Association agreeing to be bound by the Rules and Regulations and Bye-Laws made under these presents. Such a person shall be exempted from payment of entrance fee but shall have to pay deposit as per Rule 5, within the period as may be prescribed and extended by the Executive Committee." 6. All that is provided under the said Article is that a member of Electrical Cable Development Association as of right be admitted as a member of the appellant-Company subject to certain conditions. It does not say that all those members in the unregistered association become members of the association much less any resolution is produced before us of the Electrical Cable Development Association to show that they are converting themselves into an incorporated body. The members of the unregistered body are all incorporated bodies having a high commercial standing in the corporate sector, and therefore, cannot be expected to be so naive or ignorant as not to take such steps in the event it was the intention of such body to become an incorporated body in the manner suggested by the appellant. If really such action had been taken, it would not have been difficult for the appellant to produce such material. Therefore, the fact that the appellant is a distinct legal entity as found by the authorities below and affirmed by the High Court, cannot be seriously disputed. Since the appellant is a distinct legal entity other than the unregistered bodies and there is no material to show that it is a successor thereto it is not understandable as to how it became a tenant in respect of the premises in question without an agreement with the Society or respondent No. 2 who is a member thereof. It baffles us and thus the view taken by the High Court appears to us to be correct. Therefore, the second contention raised by the appellant either has no merit and is rejected.7. So far as the third contention urged on behalf of the appellant is concerned in the view we have taken, we may at once state that it is not necessary to examine the evidence adduced before the appellate Court and the appreciation of the same by it. Even without deciding the same if we assume the same for the purpose of appreciation of the matter that the findings recorded by the appellate Court are not correct and deserve to be answered in favour of the appellant, still the appellant has to fail in view of the finding we have recorded on the second contention raised by the appellant.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]6. All that is provided under the said Article is that a member of Electrical Cable Development Association as of right be admitted as a member of thesubject to certain conditions. It does not say that all those members in the unregistered association become members of the association much less any resolution is produced before us of the Electrical Cable Development Association to show that they are converting themselves into an incorporated body. The members of the unregistered body are all incorporated bodies having a high commercial standing in the corporate sector, and therefore, cannot be expected to be so naive or ignorant as not to take such steps in the event it was the intention of such body to become an incorporated body in the manner suggested by the appellant. If really such action had been taken, it would not have been difficult for the appellant to produce such material. Therefore, the fact that the appellant is a distinct legal entity as found by the authorities below and affirmed by the High Court, cannot be seriously disputed. Since the appellant is a distinct legal entity other than the unregistered bodies and there is no material to show that it is a successor thereto it is not understandable as to how it became a tenant in respect of the premises in question without an agreement with the Society or respondent No. 2 who is a member thereof. It baffles us and thus the view taken by the High Court appears to us to be correct. Therefore, the second contention raised by the appellant either has no merit and is rejected.7. So far as the third contention urged on behalf of the appellant is concerned in the view we have taken, we may at once state that it is not necessary to examine the evidence adduced before the appellate Court and the appreciation of the same by it. Even without deciding the same if we assume the same for the purpose of appreciation of the matter that the findings recorded by the appellate Court are not correct and deserve to be answered in favour of the appellant, still the appellant has to fail in view of the finding we have recorded on the second contention raised by the appellant.