2016 Supreme(Kar) 871

IN THE HIGH COURT OF KARNATAKA, BENGALURU
RAM MOHAN REDDY, H. BILLAPPA, JJ.
Mr. Kedambadi Jagannatha Shetty Son of K.P.N. Shetty & Ors. - Petitioners
Vs.
Karnataka State Judicial Department Employees House Building Co-Operative Society & Ors. - Respondents
Writ Petition No. 7105 of 2007 (GM-KSR-PIL)
Decided On : 03-06-2016

Headnote:KARNATAKA CO-OPERATIVE SOCIETIES ACT, 1959 [K.A. No. 11/1959] -Section 18 - Nominal or Associate Members - Held, From the provisions of Section 18 it is amply clear that to be admitted as an Associate member of a Co-operative Society, the person should be an individual who needs the services of such Co-operative Society residing in the area of operation of the Society and competent to enter into a contract under Contract Act, 1872. The proviso in Section 18 imposes a restriction of the number of Associate members in a Co-operative Society not to exceed 15% of the total membership of the Society and in case the Society already has more than 15% of its total membership as Associate members then the excess Associate members are required to be made as a members, it eligible, under Section 16 or shall be removed from the Associate membership within six months from the date of commencement of Karnataka Co-operative Societies (Amendment) Act, 2014.

        The affidavit dated 23.04.2016 of the President of the Society states that as on 20.04.2016, the total number of regular members of the Society is 3487, while Associate members 1432 and the 223 Associate members have been allotted sites in the Judicial Layout at Allalasandra, Yelahanka Hobli. It is further stated that Original Suits are instituted by the Society in respect of 15 such sites allotted to Associate members pursuant to cancellation of allotment pending adjudication. It is further stated that 12 out of 223 sites allotted have been handed over to the BBMP to make up the deficiency in the civic amenity area, while additionally 122 sites are allotted to Associate members who were erstwhile land owners from whom the Society purchased lands by agreement and with whom compromise was entered into before the Civil Court to resolve the disputes.

        The further statement in the affidavit is that in the layout on Kanakapura Road (Talaghattapura Village, Uttarahalli Hobli, Bangalore South Taluk, 117 sites are allotted to 117 Associate members and that therefore, 462 sites are allotted in favour of Associate members in both the layouts put together. According to the deponent the allotments were made long prior to Karnataka Act No.35/2014 coming into force w.e.f. 6.9.2014. Additionally it is stated, on oath that no allotments are made by the Society to any Associated member after the interim order dated 18.7.2007 passed in the petition.

        The Court thinks it appropriate that if it appeals to the conscious of the members, associate members, nominal members inducted as such, in the Society and allotted sites feel that they were disentitled to membership or allotment of sites, and voluntarily surrender membership or the sites allotted by the Society, would be entitled to the benefit of refund of the amounts deposited and paid as consideration to the Society together with interest at 6% p.a. from the date of deposit until date of payment.

        Since the allegations over induction of members, Associate members and nominal members who do not qualify nor meet the requirements of the Model Bye-laws and also do not qualify for allotment of sites formed in the layout by the Society, touch upon questions of fact, which cannot be conveniently adjudicated in Writ Petition, Court think it appropriate to direct the Managing Committee of the Society to hold an inquiry within six months from the 30th of June, 2016 and take action in accordance with law to annul all such memberships contrary to the Bye-laws as well as the allotment of sites to such members, associate members and nominal members. Directions issued by the Court.

       KARNATAKA CO-OPERATIVE SOCIETIES RULES, 1960 - Illegalities in allotment of sites by Karnataka State Judicial Department, Employees Home Building Co-op., Society - Held, The amendment providing constitutional status to the Societies has brought our radical changes in the concept of Co-operative Societies. Democratic functioning and autonomy have now become the core constitutional values of a Co-operative Society. Such Societies are to be registered only if they are founded on co-operative principle of democracy, equality, equity and solidarity. Writ Petitions is initiated in public interest, which is not merely a question involving the management of the Society but of frittering away land acquitted for a public purpose. If there is a larger public interest, Court could interfere in a Public Interest Litigation. In that view of the matter, it cannot be said that the petitioners were not acting Probono public. Hence, W.P. filed against the Society is maintainable.

       CONSTITUTION OF INDIA - Articles 226 & 227 - Availability of alternative remedy - Held, Availability of alternative remedy cannot be an embargo for the exercise of extraordinary Writ Jurisdiction if illegality is palpable from pleadings. It is settled law that the alternate remedy is a rule of convenience and not a rule of law and the extraordinary jurisdiction of High Court is never whittled by the existence of an alternate remedy.