1989 Supreme(Bom) 61

IN THE HIGH COURT OF BOMBAY
M.L. Pendse V.P. Tipnis, JJ.
Karvenagar Sahakari Griha Rachana Sanstha
Maryadit another .... Petitioners.
Versus
State of Maharashtra others.... Respondents.
Writ Petition No 4415 of 1987, decided on 27-2-1989.
Advocates appeared :
B.R. Naik, with Y.R. Naik and Prashant Naik, for petitioner.
A.S. Bobde, A.G with V.A. Gangal, A.G.P., for respondents 1 to 4.
Y.S. Jahangirdar, for respondents 5 6.

Headnote:Article 19 (1) (c)

       See Maharashtra Co-operative Societies Act, 1961, Sections 79-A, 4 and 14.

       

       Sections 4, 79-A and 91-Maharashtra Co-operative Societies Rules. 1961 –Rule 10-Constitution of India-Articles 19 (1) (c) and 226-Tenant Ownership Housing Society- Lease of plots for members for purpose of raising constructions for their personal use-Maharashtra Notification dated 19-1-1985 issued by State Government providing direction to Registrar to make amendments in their bye-laws and grant permission to members to raise multi-storeyed constructions- Section 4 or Section 79-A confers no such powers upon the State Government-Notification struck down-Such amendments violative of fundamental rights enshrined under Article 19 (1)(c) of the Constitution-In such cases powers of Registrar quasi-judicial-Held, exercise of powers by Registrar illegal Petitioners entitled to such relief.

       Respondent No. 5 has joined the petitioner-Society and has accepted the bye-laws framed by the Society and registered by the Registrar. The bye-laws make it crystal clear that the construction is to be raised by the allottee for his own use and the member is not permitted to part with possession or to sub-let the premises without the prior approval of the Society. Inspite of this clear cut agreement, Respondent No.5 is insisting that multi-storeyed building can be raised on his plot and Respondent No.5 would dispose of the flats on ownership basis.

       In the present case the directive is issued by the State Government on a spacious ground that there is dearth of accommodation in the cities like Pune and Bombay. Though there is undoubtedly dearth of accommodation that does not enable the State to compel the Housing Society to act contrary to bye-laws or to foist new members who are not acceptable to the existing members of the Society. The members have joined the Society in accordance with the bye-laws and the members join a Housing Society by ascertaining what" auld be the environments in which they will reside. It is not permissible for the State Government to compel the Society to amend its bye-laws as to defeat the object of formation of the Society. In the present case the Society was constituted with the object of providing peaceful accommodation to the Members. The compulsion of the State Government that members should be permitted irrespective of the desire of the majority, to erect high rising buildings would totally destroy the basic concept of formation of Society. The answer to the dearth of accommodation is not to force the existing registered Housing Societies to amend bye-laws and permit few members to commercially exploit the plots in violation of agreements under which they were secured. The directive is nothing but a charter to permit breach of such agreements and compulsion to amend bye-laws is only with a view to violate such infraction. Therefore, neither Section 4 nor Section 79-A of the Act confers any such power upon the State Government. The notification issued by the State Government therefore is without any authority or jurisdiction and is therefore required to be struck down.

       Article 19 (1) (c) confers right on all citizens to form association or union and the petitioner-Society is constituted in exercise of that right. It is undoubtedly true that the right to form association can be regulated by the provisions of the statute. The petitioner-Society is registered under the Act and the bye-laws of the Society are also registered by the Registrar as the same are in accordance with the requirements of the Act and the Rules. By the impugned notification the Government provides that a member can raise high rising building on the allotted plot and the occupiers of such plot would form a Society, which can be described loosely as a sub-Society and the representative of such sub-Society would be a member of the petitioner Housing Society. In other words, the Government is compelling the Housing Society to accept a sub-Society on its land and then accept the sub-Society as a member of the petitioner-Society.

       Right to form association conferred under Article 19 (1) (c) is not only limited to the initial formation of the association but also operates in respect of continuance of such association. The direction issued by the State Government infringes upon right of citizen to form and continue the association and to determine who shall be member of such association. The State Government is forcing a member on such association and such compulsion clearly amounts to infraction of the fundamental rights.

       Even assuming that the Government has power to issue directive, the directive issued under the impugned notification is clearly violative of Article 19 (1) (c) of the Constitution.

       The Registrar is required under the provisions of the Act to exercise powers and while exercising the powers the Registrar is performing quasi-judicial functions. The power exercised by the Registrar is appellable under Section 152 of the Act and further revisable by the State Government. It is now well-settled that exercise of such powers are quasi-judicial and the Registrar in exercise thereof should not be guided by extraneous consideration or by the directions issued by higher authorities including the State Government.

       Section 14 provides that the Registrar may call upon the Society to make the amendment provided it appears to the Registrar that an amendment of the bye-laws is necessary or desirable in the interest of such Society. The crucial words are "necessary or desirable in the interest of such Society". The Register has to be satisfied that the amendments of the bye-laws are necessary or desirable in the interest of Society to which order is directed. The Registrar in the present case has not even examined whether the requirements of Section 14 are satisfied, but has directed the Society to amend the bye-laws merely because the Government so desires. It hardly requires to be stated that permission to an allottee of a plot in the Housing Society to erect multi-storeyed structure would not be in the interest of the Housing Society. The Housing Society, like the petitioner Society, is formed with a view to provide for peaceful accommodation to the members and therefore the byelaws insist that the allottee of a plot of land can erect structure for his own occupation and not for letting out or for commercial exploitation of land. An amendment to the bye-laws permitting such action can by no stretch of imagination be in the interest of Society. The members of the Society contributes the amount for maintenance of common amenities and service and the liability to contribute is on the basis that plots of land would be enjoyed by the members by construction of houses for their own benefit.

       It is, therefore, obvious that the Registrar is forcing the petitioner Society to amend the bye-laws when it is neither necessary nor desirable in the interest of the petitioner-Society.

       The Registrar has issued a flat compelling the petitioner-Society to amend the bye-laws without satisfying whether the necessary ingredients for exercise of powers under Section 14 of the Act arc in existence.

       The exercise of powers in the present case are clearly faulty and the petitioners arc entitled in the relief sought.

       

       Sections 79-A, 4 and 14-Constitution of India. Article 19 (1) (c)-Power Housing Society bye-laws -Amendment by Government-Necessity-Interest of public society-Notification by Government-Jurisdiction-Held-Directions issued by Government was violative of article of the constitution- Liable to be struck down.

       The notification issued by the State Government was without any authority or jurisdiction and was, therefore, liable to be struck down. The direction issued by the State Government infringed upon right of citizen to form and continue the association and to determine who shall be member of such association. The State Government was forcing a member on such association and such compulsion clearly amounted to infraction of the fundamental rights. The direction was clearly violative of Article 19 (1) (c) of the Constitution. Right to form association conferred under Article 19 (1) (c) is not only limited to the initial formation of the association but also operates in respect of continuance of such association The Registrar was forcing the Petitioner-Society to amend the bye-laws when it was neither necessary nor desirable in the interest of the petitioner-society. The power under Section 14 of the Maharashtra Co-operative Societies Act, 1960 can be used only if it is established that the amendment of the bye-laws was desirable and was in the interest of the Society. The exercise of the power in the present case was clearly faulty. The petitioners accordingly were entitled to the declaration as claimed.

       Co-operative Society-What is.

       A Co-operative Society is a voluntary association of persons; it is an economic institution informed by social purpose and not motivated by enter Preneurial profits; it is a democratic organisation owned and controlled by those utilizing its services. A combination of all these features mark out Co-operatives as a distinct organisations, different from other types in the private or public sector.