Case: DELHI DAYALBAGH COOPERATIVE HOUSE BUILDING SOCIETY LTD Vs. REGISTRAR COOPERATIVE SOCIETIES

of the Act, 2003 can have a force of law. 42. As regards clauses 2 & 3 of the original sale deed executed between the member of the society at the time of initial allotment is concerned, the society reserves its pre-emptive rights to have a cooling period of six months before the member may have an opportunity to transfer the subject plot in the manner he or she likes at least there was no absolute bar or restrain under clause 2 or 3 of the original sale deed, of which reference has been made, to transfer the land or is otherwise impermissible to a non-member under any other laws. But it was possible with prior notice to the society and the cooling period of six months which may enable the society to purchase the plot on the market value and if it is unable to purchase, the member reserves the right to transfer or sell out the plot in a manner he or she likes reserving the pre-emptive rights of the society. In the given circumstances, transfer by a registered instrument cannot be held void unless it is in contravention of any law, which is not the case of the appellant society. 43. It reveals that what transpired before the Tribunal or the High Court was whether the transfer of title by a registered instrument as alleged was open for scrutiny within the scope of Section 70 of Act, 2003. Although it was never the case of the appellant society that alleged registered sale deed was void ab initio, bad or obtained by fraud or malpractices and it was also not the case of the appellant society that the member of the society in transferring the rights over the property by a registered sale deed, is in violation of any of the provisions of the Act of 2003, or the rules of 2007 framed thereunder. 44. It is gainful to add that the possession was handed over to the society on fulfilment of the conditions of the agreement dated 13 th May, 1955, published in the Gazette under Section 42 of the Land Acquisition Act, and became the law as observed, that at the time when the possession was handed over to the society by the State Government, no further deed or MOU was executed restricting the rights of the society for fulfilment of its obligation of its plots to its members, that persuades to infer that the possession was handed over to the society of the subject land in question by the Government free from encumbrances with unrestrictive rights to execute the sale deed/allot the plots to its members obviously as per its bye-laws keeping in view of the mandate of the statutory provisions of the Act, 1973 or Act, 2003 which has later on taken over the field in protecting the interests of the members of the cooperative societies including the cooperative housing society as in the instant case. 45. It may be relevant to note that the subject land was throughout exhibited by the society as freehold land having ownership rights and allotments were made by the society to its members by the registered sale deed at the time of allotment of plots. It is to be noticed that a letter dated 27 th July, 1985 was written by the Secretary of the society to the Lt. Governor and it was mentioned in paragraph 2 of the letter that Delhi Administration acquired 30 acres of land allotted to the society on 25 th March, 1957 on freehold basis. Later, in the letter dated 15 th March, 1989 issued to the Secretary of the Society it was certified that the status of the land is totally freehold and allotment of the plots to the society members was also on the basis of it and the society at one stage approached to the civil Court in RCA No. 95/82 titled Delhi Dayalbagh Cooperative House Building Society Ltd. Vs. Arjun Das and it was observed by the learned trial Judge that the land in dispute is freehold one and there is no legal bar to the same being sold. In the given facts and circumstances, if the allotment has been made by the society as a freehold land to its members who have further transferred/sold the subject land/plot by registered sale deed to its successors/purchasers, their rights to become member of the society are indeed saved under Section 91 of the Act, 2003 that in no manner could be eluded by the bye-laws and that apart if anyone has any objection regarding the registered instrument(sale deed) pursuant to which right has been created, at least it is not open to examine its validity within the domain and ambit of Section 70 of the cooperative societies Act and any person, if felt aggrieved, the remedy lies only before the civil Court having jurisdiction questioning the registered instrument within the parameters available under the law. 46. The appellant society at one stage in their counter affidavit has stated that the subject land is a grant under the Government Grants Act. It was nowhere the case ever set up and it was raised just to denude the rights of the parties which deserves outright rejection for the additional reason that the subject land was acquired by the Government under Part VII of the Land Acquisition Act and transferred to the society free from encumbrances, there is no applicability to the Government Grants Act. The judgment on which reliance was placed by the learned senior counsel for the appellant in Mohsin Ali and Others Vs. State of Madhya Pradesh 1975(2) SCC 122 may not be of any assistance. 47. As regards submission made in respect to Section 44A of the Act is concerned, it may not have any application, since the rights of the parties are governed after the land stood vested with the society free from encumbrances and regulated under the special enactment of the Act 2003 and Rules 2007 framed thereunder.

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

Explanation:
0[ds]It is not the case of either party that there was any breach or violation of the terms and conditions which has been referred to under the agreement dated 13 th May, 1955 either by the society or its members or the purchasers or the successors in interest32. The emphasis of learned senior counsel for the appellant that the title of the land in question never stood transferred to the society in the absence of the deed of conveyance been executed, is without substance for the reason that the title at the first place in favour of the society was not created by any of the modes ascribable to the Transfer of Property Act and once the acquisition proceedings have been initiated by the Government, on fulfilment of the conditions referred to under Section 41 of Land Acquisition Act on being published in the Gazette dated 13 th May 1955 under Section 42 of the Act which became the law, there appears no further statutory requirement to register any deed of conveyance under the Transfer of Property Act. Besides it, the consideration amount was paid by the society as demanded by the competent authority and physical and actual possession, free from encumbrances, was delivered to the appellant society and the land stood conveyed and granted in terms of clause 2 of the agreement. At the same time, no party in the instant proceedings ever raised any objection/dispute on the issue of physical possession of the land in question being delivered to the appellant society and/or the same being passed on to the person who have purchased plots/flats therein subsequently. In the given facts and circumstances, it can legitimately be observed that the marketable title in transferring respective plots to its members has created a statutory genesis33. It is also not the case of the appellant society that at any later stage, after the appropriate Government handed over possession, free from encumbrances, of the subject land in question to the society, it ever raised objection in reference to the breach of the terms & conditions of the agreement dated 13 th May, 1955 to resume the subject land or for taking legal recourse in reference to the title of the subject land in question. In the given facts and circumstances, a legal presumption can be drawn that after the peaceful possession free from encumbrances, was handed over by the State Government to the society, all rights of the said land stood vested with the society free from encumbrances and transferred to its members on the terms as indicated in the registered sale deed executed by the society40. The contention of the learned senior counsel for the appellant that the sale/transfer of the plot in question by the member of the society being in violation of condition nos. 2 and 3 of the registered sale deed or clause 51 of the bye-laws which put restriction on the member to transfer or a sale or otherwise to a non-member of the society, without permission of the society in our opinion, deserves to be negated for the reason that there is no restriction/prohibition under the provisions of the Act, 2003 which has been discussed in detail earlier and to be noticed that if the bye-laws to the extent are inconsistent to the provisions of Act 2003, it is the statute which will prevail and it is not the case of the appellant that the transaction of sale/transfer of the plot in question by the member of the society by registered sale deed or registered instrument is in violation of the provisions of the mandate of Act 2003 or rules 2007 framed thereafter41. To the contrary, it appears to be the duty of the Registrar cooperative societies including the registered housing cooperative society to scrutinise the bye-laws of the society and to the extent they are inconsistent with the provisions of Act 2003 or of Rule 2007 framed therein, to ask them to make appropriate corrections and to amend it to make it in conformity with the Act, 2003. It is needless to say that it is the onerous duty of the competent authority to ensure that it performs the statutory task in this behalf but if the task has not been performed as yet, at least no provision in the bye-laws inconsistent with the provisions of the Act, 2003 can have a force of law42. As regards clauses 2 & 3 of the original sale deed executed between the member of the society at the time of initial allotment is concerned, the society reserves its pre-emptive rights to have a cooling period of six months before the member may have an opportunity to transfer the subject plot in the manner he or she likes at least there was no absolute bar or restrain under clause 2 or 3 of the original sale deed, of which reference has been made, to transfer the land or is otherwise impermissible to a non-member under any other laws. But it was possible with prior notice to the society and the cooling period of six months which may enable the society to purchase the plot on the market value and if it is unable to purchase, the member reserves the right to transfer or sell out the plot in a manner he or she likes reserving the pre-emptive rights of the society. In the given circumstances, transfer by a registered instrument cannot be held void unless it is in contravention of any law, which is not the case of the appellant society43. It reveals that what transpired before the Tribunal or the High Court was whether the transfer of title by a registered instrument as alleged was open for scrutiny within the scope of Section 70 of Act, 2003. Although it was never the case of the appellant society that alleged registered sale deed was void ab initio, bad or obtained by fraud or malpractices and it was also not the case of the appellant society that the member of the society in transferring the rights over the property by a registered sale deed, is in violation of any of the provisions of the Act of 2003, or the rules of 2007 framed thereunder44. It is gainful to add that the possession was handed over to the society on fulfilment of the conditions of the agreement dated 13 th May, 1955, published in the Gazette under Section 42 of the Land Acquisition Act, and became the law as observed, that at the time when the possession was handed over to the society by the State Government, no further deed or MOU was executed restricting the rights of the society for fulfilment of its obligation of its plots to its members, that persuades to infer that the possession was handed over to the society of the subject land in question by the Government free from encumbrances with unrestrictive rights to execute the sale deed/allot the plots to its members obviously as per its bye-laws keeping in view of the mandate of the statutory provisions of the Act, 1973 or Act, 2003 which has later on taken over the field in protecting the interests of the members of the cooperative societies including the cooperative housing society as in the instant case46. The appellant society at one stage in their counter affidavit has stated that the subject land is a grant under the Government Grants Act. It was nowhere the case ever set up and it was raised just to denude the rights of the parties which deserves outright rejection for the additional reason that the subject land was acquired by the Government under Part VII of the Land Acquisition Act and transferred to the society free from encumbrances, there is no applicability to the Government Grants Act. The judgment on which reliance was placed by the learned senior counsel for the appellant in Mohsin Ali and Others Vs. State of Madhya Pradesh 1975(2) SCC 122 may not be of any assistance47. As regards submission made in respect to Section 44A of the Act is concerned, it may not have any application, since the rights of the parties are governed after the land stood vested with the society free from encumbrances and regulated under the special enactment of the Act 2003 and Rules 2007 framed