Usha Arvind Dongre vs Suresh Raghunath Kotwal

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

1989 Supreme(Bom) 372

IN THE HIGH COURT OF BOMBAY
Mrs. Sujata Manohar, J.
Usha Arvind Dongre ..... Petitioner.
Versus
Suresh Raghunath Kotwal .... Respondent.
Arbitration Petition No. 5 of 1989, decided on 11-12-1989.
Advocates appeared :
Girish Desai i/b Gordhandas Fozdar, for petitioner.
V.V. Tulzapurkar with Uday Bobde i/b Chitnis Vaithy Co., for respondent.

Headnote:Section 41-Registration Act, 1908-Sections 17 (1) (b) and 41-Mabarashtra Co-operative Society Rules, 1961-Rule 10-Teoant Co-partnership Housing Society-Share held in such Society by member-Transfer of such shares-Question of registration-Applicability of Section 41 and Section 17 (1) (b)-Award by Arbitrator dealing with transfer of shares in flats in tenant co-partnership Society-Held, Section 17 (1) (b) did not apply to such au award -And hence did not required registration under that Section of the Registration Act-AIR 1989 SC 1923 and AIR 1987 SC 841 dist.
       It was a Tenant Co-partnership Housing Society the lands and buildings belonged to the Society. The flats were allotted for occupation to the members of the Society the arbitration was in respect of the ownership of shares in the Society and the consequent right to occupy the flats which arose as a result of holdings of shares in the said Society The arbitrators by their award held that the membership in the said-society should be transferred to the respondents. It fact in the award they have given directions relating to applying to the Society for transfer of shares as set out earlier. The award therefore did not deal with any declaration or creation of rights in an immovable property. It deals with the transfer of shares in the said Society. Section 17 (1) (b), therefore, cannot have any application to such an award.
       The arbitration pertains to shares in the said Society and the award gives a declaration in respect of those shares. Therefore, Section 17 (1) (b) did not apply to such an award.
       It is true that the award does mention that the title to the flats in question is awarded to the respondents. But that has to be understood in the content of the fact that the flats is owned by a Co-operative Housing Society which is a Tenant Co-partnership Co-operative Housing Society the arbitrators were themselves conscious of that fact and have given detailed directions relating to the transfer of membership in the Housing Society the objection, therefore, relating to non-registration of the award failed.
       In the instant case, therefore, the award which deals with transfer of shares in the said flats in a Tenant Co-partnership Society did not require registration under Section 17 (1) (b) of the Registration Act.
       Sections 13 and 30-Maharashtra Co-operative Societies Act, 1960- Section 41-Indian Registration Act. 1908-Section 17 (1) (b)-Arbitrator- Powers of-Arbitrators required to determine the rights of various parties and to award amount to be paid by them to one another-Have an implied powers prescribe the manner in which the amounts awarded by them to be paid In adjudging the amounts payable by the party to another, an arbitrator bas full powers to direct payments by instalments-The directions as to the number, amount, mode and time of payment of those instalments were matters within the direction of the Arbitrator and forms essential parts of an award which a Court bas no more powers to modify than it has to enhance or reduce that total sum found payable by the Arbitrator-AIR 1930 Lab 26 foil.
       Sections 13 and 30- Power of arbitrator-Rights of parties and payment of award amount- Determination of mode of payment of award amount-Held, arbitrator has power to direct payment by instalments.
       In adjudging the amount payable by one party to another, an arbitrator has full power to direct payment by instalments. The directions as to the number, amount, mode and time of payment of these instalments are, therefore matters within the discretion of the arbitrator and from essential parts of an award which a court has no more power to modify than it has to enhance or reduce the total sum found payable by the arbitrator. Even if the order fixing the instalments is erroneous, harsh or oppressive, the error is one of substance in the adjudication of the dispute, and not of form which could be amended without affecting the decision.
       Section 41-Registration Act, 1908, Sections 17 (1) (b)-Transfer of share in co-operative society-Tenant co-partnership housing society-Title to Its flats remaining In society and not affected by transfer of shares - Shares not becoming immovable property-Transfer of such shares therefore does not require registration under Section 17 (1) (b).
       Looking to Section 41 of the Maharashtra Co-operative Societies Act, 1960 the intention was clearly to exclude transfer of shares in a Co-operative Society from the provisions of Section 17 of the Registration Act. In the case of a tenant Co-partnership housing society the title to the flat remains in the Society and is not affected by the transfer of shares in the society. Only the right to occupy a flat flows from the ownership of share in such a Co-operative Society the shares, thereby do not become immovable property. A transfer of such shares does not require registration under Section 17 (1) (b). Even if the transfer of such shares is considered as a transfer of interest in an immovable property. Section 41 of the Maharashtra Co-operative Societies Act exempts the document effecting transfer of such shares from the ambit of Section 17 (1) (b) of the Registration Act.
       REGISTRATION ACT, 1908.
       Sections 17 (1) (b).
       See Maharashtra Co-operative Societies Act, 1960, Section 41.

JUDGMENT - Mrs. SUJATA MANOHAR, J.:---This is a petition to set aside the Arbitration Award No. 94 of 1988 which is dated 30th June, 1988 and is filed in this Court. The petitioner and the respondent are sister and brothers. The father of the petitioner and the respondent expired at Bombay on or about 26th March, 1970 leaving behind his last Will and testament dated 10th December, 1964. Under this Will the deceased bequeathed his entire estate including Flat No. G-3, in Dadar Co-operative Housing Society, Bhavani Shankar Road, Dadar, Bombay-400 028 in equal shares to his widow and his two children, viz. the petitioner and the respondent.

2. The mother of the petitioner and the respondent Pramilabai R. Kotwal died on or about 13th December, 1961, leaving behind the petitioner and the respondent as her only heirs and legal representatives under the provisions of Hindu law by which the parties are governed. Thereafter disputes and differences arose between the petitioner and the respondent relating to the distribution of the estate of their deceased parents.

3. Under an agreement of reference dated 5th August, 1987 executed by both the parties the disputes were referred to the joint arbitration of Mr. M.K. Kotwal and Mr. S.K. Kotwal, both of them close relatives of the parties. The recital to the agreement of reference which is at Exhibit 'C' sets out that the property left by the deceased persons mainly consists of Flat No. G-3, in Sharda Ashram at Bhavani Shankar Road, Dadar, Bombay-28 some ornaments, shares, fixed deposits of companies and bank accounts. Under the terms of the agreement of reference the arbitrators were inter alia, required to ascertain the estate belonging to both the deceased persons and divide that same as suitably and conveniently as possible between the parties in equal shares in such manner as the arbitrators think fit.

4. The statements of claim were filed by both the parties as also replies to each other's claims. By an award dated 30th June, 1988 the arbitrators have given detailed direction relating to the division of the estate. They have inter alia declared and directed that the absolute title, interest, possession, occupancy and enjoyment of the furnished Flat Block No. G/3 in the Dadar Co-operative Housing Society Ltd., Bhavani Shankar Road, Dadar, Bombay-400 028 alongwith the furniture and fixtures, crockeries, utensils, clothing etc. are awarded in favour of the party of the First Part Shri Suresh Raghunath Kotwal who is already in possession of the same.......

"We hereby declare and direct that the lumpsum of Rs. 1,50,000/- (Rupees one lakh fifty thousand only) is awarded in favour of the party of the second part Mrs. Usha Arvind Dongre as the value in exchange for her share in the said furnished Flat and other movables."

........"As we have awarded the title and ownership of the Flat in favour of the party of the first part Shri Suresh R. Kotwal, we hereby declare and authorise him as entitled to apply for the transfer of membership, shares and other interests in the said Flat to the Dadar Housing Co-operative Society Limited, but not before 15th November, 1988."

......."We hereby declare that the letter dated 21st June, 1984 written by the party of the second part Mrs. Usha A. Dongre to the Dadar Co-operative Housing Society Limited, taking objection for any transfer in favour of the party of the First part Shri Suresh R. Kotwal has now become obsolete, inoperative and null and void.

"Therefore, we request the Dadar Housing Co-operative Society Limited, and its Managing Committee to sanction the application for transfer made by the party of the First part made after 15th November, 1988 and insert the name of Shri Suresh Raghunath Kotwal in place of late Smt. Pramilabai Raghunath Kotwal as the member and share-holder of the Society in respect of the said Flat."

The other directions in report pertain to distribution of ornaments and other moveable properties and the mode of payment by instalments

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