IMPORTANT POINT
General Body resolution adopted by majority cannot be challenged by a handful of members.

Headnote:(a) Administration of Justice – Judicial Review – Managing Committee of the society suspended and Administrator appointed – Decision of auction sale of society’s land in pursuance of earlier General Body resolution – Injunction thereagainst sought and obtained – However, vacation of the injunction not challenged – Plea of no office bearer of society in place – Members, in individual capacity challenging the auction sale in writ petition after seven years – Even if no elected office bearer was in place to challenge the vacation of injunction, individual members could have done it as was done seven years after by filing writ petition – Plea not acceptable. (Para 27)
       (b) Administration of Justice – Judicial Review – General Body resolving to auction sale society’s land under the then Secretary – Secretary removed – GB resolution pursued – After his removal, ex-Secretary challenging the GB resolution – Not tenable. (Para 28, 33)
       (c) Co-operative society land – Auction sale – General Body under elected Secretary and Managing Committee resolving to auction sale the land – Secretary and Committee removed – Board of Administrators taking over – Giving effect to the GB resolution – Challenging the price after 11 years – Not fair – Moreover, resolution adopted by majority of members – Now only 10 members left – They cannot challenge the majority resolution. (Para 31, 36)
       (d) Constitution of India – Article 226/227 – Disputed questions of fact raised in writ petition – Questions raised could be better appreciated and adjudicated by adducing evidence – Petitioners chose a wrong forum – Should have approached a competent civil court – Despite that High Court considering all aspects and deciding the petition – No infirmity. (Para 33)
       (e) Administration of Justice – Mala fide – Challenge o price obtained at auction – Mala fide alleged – Cannot be sustained on the basis of speculation, assumption and inference. (Para 36, 37)
       Facts of the case:
       The Mount Everest Co- operative Group Housing Society had purchased approximately 10 acres 4 kanals 14 marlas of land in Village Wazirabad as well as Hyderpur Viran with the funds contributed by the members of the Society for achieving its objects.
       The Managing Committee constituted at the time of formation of the society was suspended on the allegations of financial irregularities and a Board of Administrator was appointed. However, the Deputy Registrar reinstated the Managing Committee of the society.
       On 28.05.2000, a new Managing Committee was constituted wherein the petitioner No.1 Captain Shri A.K. Mahindra was elected as Member of the new Managing Committee and later on was entrusted with the work of Honorary Secretary of the Society.
       FIR was lodged against the previous Secretary and managing Committee for financial irregularities.
       It was resolved that the only option left before the Society was to sell the land at the best possible market price so as to refund the contributions made by the members. The General Body of the Society decided to sell off the land.
       The Registrar, Co-operative Societies passed a suspension order on 13.12.2002 under Section 34 (2) of the Haryana Co-operative Societies Act, 1984, suspending the new Managing Committee of the Society based on allegations of gross and serious irregularities as a result of which a Board of Administrators was appointed. Thereafter, on 14.01.2003, the Registrar, Co-operative Societies granted permission to the Board of Administrators to dispose of the society land and the Deputy Registrar, Co-operative Societies, Gurgaon formed a Sales Committee of 5 members for selling land of the Society.
       In the meanwhile CWP was filed by Captain A.K. Mahindra and others challenging the order of suspension of the new Managing Committee as well as the order granting permission to sell the land.
       During pendency of the said writ petition, Assistant Registrar, Co-operative Societies, Gurgaon on 05.09.2003 removed the new Managing Committee under Section 34 (1) of the Haryana State Co-operative Societies Act, 1984.
       The auction was held on 24.11.2003 whereby the land belonging to the Society was sold to respondent No.7 for a sum of Rs.4,94,04,125/- as against the estimated market rate of about Rs.4.2 crores.
       The erstwhile Secretary of the Co-operative Society Captain A.K. Mahindra who had been suspended by the Registrar, Co-operative Society along with 37 members (38 in all) filed letters patent appeal No.215 of 2007 before the Division Bench of the High Court wherein the auction sale conducted by the Board of Administrators under the supervision of the Sales Committee of 5 members which included Deputy Registrar, Co-operative Societies, Gurgaon, Inspector, Co-operative Societies, Gurgaon, Sub- Inspector, Co-operative Societies, Gurgaon filed letters patent appeal before the Division Bench of the High Court wherein the auction sale conducted by the co-operative societies in pursuance to the order of the Registrar passed by the co-operative societies were challenged
       The LPAs were dismissed.
       Finding of the Court:
       There is no infirmity in impugned judgments.
       Result: Appeals dismissed.

JUDGMENT

GYAN SUDHA MISRA, J. –

1. Delay in SLP (civil) 4758-59/2011 condoned.

2. Leave granted in both sets of special leave petitions.

3. These appeals by special leave have been preferred against the judgment and order dated 27.08.2010 passed by the High Court of Punjab and Haryana at Chandigarh in Letters Patent Appeal Nos.215 and 216 of 2007 (O&M) whereby the Division Bench of the High Court dismissed both the letters patent appeals by a common judgment and order which is under challenge herein.

4. The letters patent appeals which stood dismissed arose out of two writ petitions filed in the High Court before the learned Single Judge bearing writ petition Nos.6491/2005 and 7742/2005 which were filed challenging the orders dated 13.12.2002, 05.09.2003 and 19.11.2004 in the High Court at Chandigarh which were the Suspension Order, Removal Order of the erstwhile Committee and order of the Dy. Registrar who dismissed the appeal against removal. The facts stated therein disclosed that on 04.03.1994, a co-operative society in the name of Mount Everest Co- operative Group Housing Society was formed and constituted under the Haryana Co-operative Societies Act, 1984 wherein 288 persons became members of the Society upto 1995-96 and contributed a total sum of approximately Rs.7.5 crores towards the funds of the Society which were to be utilised for purchase of the land. In the year 1996, the Society purchased approximately 10 acres 4 kanals 14 marlas of land in Village Wazirabad as well as Hyderpur Viran with the funds contributed by the members of the Society for achieving its objects. At the time of formation of the Society, a Managing Committee had also been constituted with Mr. R.P. Gupta as Secretary but the same was suspended on 23.10.1996 by the then Assistant Registrar Co-operative Societies, Gurgaon on the allegations of financial irregularities and a Board of Administrator was appointed. However, the Deputy Registrar reinstated the Managing Committee of the society on 30.08.1999. Subsequently, on 28.05.2000, a General Body Meeting of the society took place in which fresh election was held and a new Managing Committee was constituted wherein the petitioner No.1 Captain Shri A.K. Mahindra (since resigned during pendency of this appeal) was elected as Member of the new Managing Committee and later on was entrusted with the work of Honorary Secretary of the Society in place of the previous Secretary Shri R.P. Gupta.

5. It is the case of the petitioner/members of the Society that the new Managing Committee after taking charge and upon inspection of the records of the Society found that the earlier Managing Committee had indulged in large scale malpractices and in order to investigate the same, an internal committee was constituted to go into the land records, finances as well as other aspects of the Society. This internal committee therefore conducted an intensive enquiry and submitted report which highlighted gross irregularities by the previous Managing Committee in the purchase of land, utilisation of members fund, expenditure on account of day to day expenses and expenses incurred on land and site development etc. This audit was conducted for the period 1993 to 2001 when the Managing Committee of the society stood suspended and the Board of Administrators was in-charge of the affairs of the Society. Finally, when the audit report was submitted in March, 2002, the Managing Committee which had been constituted on 28.05.2000 with A.K. Mahindra as Secretary decided to lodge an F.I.R. against the members of the earlier Managing Committee when R.P. Gupta was the Secretary and the F.I.R. finally was lodged with the Police Station DLF, Gurgaon after which investigation was conducted and arrests were made.

After investigation, charge sheet was also submitted in the criminal courts but as per the charge sheet, no allegation was found against any members of the then Managing Committee except Mr. R.P. Gupta who was a member and Honorary Secr

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2014 Supreme(SC) 352

IMPORTANT POINTGeneral Body resolution adopted by majority cannot be challenged by a handful of members.

IMPORTANT POINT
General Body resolution adopted by majority cannot be challenged by a handful of members.