M/S. Anita Enterprises & Anr vs Belfer Coop. Housing Society Ltd. & Ors

2. The facts, in brief, are that the Belfer Cooperative Housing Society Limited, Bandra [West], Mumbai, respondent No. 1 in Civil Appeal Nos. 2990-2991 of 2005, [hereinafter referred to as `the Society'], which was a tenant co-partnership housing society, held both lands and flats constructed thereon and Dr. Gopal Mahadeo Dhadphale, respondent No. 2 in the said appeals [hereinafter referred to as `the member'] was admitted as member of the Society in the year 1962 and flat No. 4 on the ground floor was allotted to him. On 3.6.1982, the member inducted M/s. Anita Enterprises, appellant No. 1 in the said appeals, in room No. 2 of the said flat on a monthly rental of Rs. 1000/- and on 3.10.1983 the appellant aforementioned was inducted in room No. 3 as well on a monthly rental of Rs. 750/-. The member thereafter inducted M/s. Anita Medical Systems Pvt. Ltd., appellant No. 2 in the said appeals, in room no. 1 of the flat in question on a monthly rental of Rs. 1000/- which was subsequently enhanced to Rs. 1500/- per month and both the appellants were put in possession of the aforesaid premises. The appellants paid rent upto the month of December, 1986 and as the member refused to accept the rental from January, 1987, the rental was sent to him by cheques under registered post, but the same was not accepted.

3. Thereupon, the appellants were asked to vacate the premises in question which necessitated filing of two separate suits by them in the year 1987 before the Small Causes Court for a declaration that they were tenants with regard to the aforesaid premises of which they were in occupation and for perpetual injunction restraining the member from interfering in any manner with their possession over the premises in question in which suits only the member was made party and not the Society. The member in the said suits contested the claim of the appellants and both the suits filed by the appellants were dismissed by the trial court upon a finding that the appellants were not inducted as tenants in the suit premises. But on appeal being preferred to the appellate bench of the Small Causes Court, the same were decreed and it was held that the appellants were inducted as tenants in the premises in their occupation.

4. In the meantime, the Society raised a dispute in the year 1989 before the Cooperative Court under Section 91 of the Maharashtra Cooperative Societies Act, 1960 [hereinafter referred to as `the Societies Act'] praying therein that the appellants be evicted from the premises in their occupation and the member be directed to occupy the same as, according to the Society, the member had parted with possession of the premises in question in favour of the appellants which was not permissible in law. The said case was contested by the appellants in which the member and the appellants entered appearance and all contested the claim of the Society. The Cooperative Court by its award decided the dispute in favour of the Society, passed an order of eviction against the appellants and directed the member to occupy the premises. The said order was upheld in appeal.

6. Undisputed facts are stated hereinafter. The Society was a tenant co-partnership housing Society, the land and the structures standing thereon, which include the premises in question, were held by it, respondent no. 2 was admitted as its member, allotted flat No. 4 and put in possession thereof. The appellants are in occupation of the premises in question since the date of their induction aforementioned and the member remained in possession of the premises for a period of more than one year before induction of the appellants therein. Induction of appellants as tenants by the member amounted to transfer of interest by the member in the premises in question, which was property of the Society, and the appellants were neither members of the Society nor can be said to be persons whose application for membership had been accepted by the Society or persons whose appeal under Section 23 of the Societies Act had been allowed by the Registrar or persons who were deemed to be members under Section (1A) of Section 23 of the Societies Act. The appellants were inducted without the consent of either the Society or its Managing Committee and never admitted as nominal members of the Society.

10. In order to appreciate the points involved in these appeals, it would be useful to refer to the relevant provisions of the Societies Act, Maharashtra Co-operative Societies Rules, 1961 [hereinafter referred to as `the Rules'], Bye-Laws of the Society which were registered with the Registrar, Cooperative Society, at the time of grant of registration to it [hereinafter referred to as `the Bye-Laws'], Regulations relating to tenancies to be granted by the Society to members in respect of premises held by the Society contained in Form A which are part of registered Bye-Laws of the Society [hereinafter referred to as `the Regulations'] and the Rent Act which run thus:-

I agree to take the tenement known assubject to the above regulations which I agree to observe and perform and by which I agree to be bound"."

The provisions aforesaid of this sub-section shall not affect in any manner the operation of sub-section (1) after the [date aforesaid]".

[Emphasis Added]

26. From a bare perusal of the aforesaid passage, it would be clear that after full payment a member is entitled to continue to occupy the tenement free of charge and neither he is liable to pay any rent to the society nor the society is entitled to receive any rent from the member. According to the definition of `landlord' under Section 5(3) of the Rent Act, landlord is a person who is for the time being receiving or entitled to receive rent and under Section 5(11) a tenant is liable to pay rent, but in view of the observations of this Court in Sanwarmal (supra), neither the society is entitled to receive rent from the member nor member is liable to pay any rent to the society after the entire value of the land and cost of construction of the building together with interest on its value has been paid.

39. For the foregoing reasons, we do not find any merit in these appeals which are accordingly dismissed, but there shall be no order as to costs.