High Court of Judicature at Bombay
R.D. DHANUKA, J.
Vardhman Developers Ltd.
Versus
Borla Co-operative Housing Society Ltd. & Others
Notice of Motion No. 1081 of 2010 IN Suit No. 1442 of 2009
Decided On : 22-10-2013
Plaint Rejection - Notice under Section 164 of the Maharashtra Cooperative Societies Act, 1960 - [164] - The suit was filed by the plaintiffs seeking declaration that the development agreement executed by and between the plaintiffs and defendant no.1 is binding on all the defendants. The applicants sought rejection of the plaint under Order VII rule 11(d) of the Code of Civil Procedure, 1908 on the ground that the suit is not maintainable if no notice under section 164 of the said Act was served upon the society. The court analyzed the legal provisions and held that the agreement entered into between the plaintiff and defendant No. 1 is for redevelopment, which is not the object for which the society was formed, and thus would not be business of the society. Any such dispute arising between plaintiff and defendant no. 1 arising out of redevelopment would not be arising out of the business of the society and thus section 164 of the Maharashtra Cooperative Housing Societies Act, 1960 would not be applicable to the suit filed by the plaintiff. The court dismissed the Notice of Motion seeking rejection of the plaint.
Fact of the Case:
The plaintiffs filed a suit seeking declaration that the development agreement executed by and between the plaintiffs and defendant no.1 is binding on all the defendants. The applicants sought rejection of the plaint under Order VII rule 11(d) of the Code of Civil Procedure, 1908 on the ground that the suit is not maintainable if no notice under section 164 of the said Act was served upon the society.
Finding of the Court:
The court found that the agreement entered into between the plaintiff and defendant No. 1 is for redevelopment, which is not the object for which the society was formed, and thus would not be business of the society. Any such dispute arising between plaintiff and defendant no. 1 arising out of redevelopment would not be arising out of the business of the society and thus section 164 of the Maharashtra Cooperative Housing Societies Act, 1960 would not be applicable to the suit filed by the plaintiff. The court dismissed the Notice of Motion seeking rejection of the plaint.
Issues: The main issue was whether the suit filed by the plaintiffs was maintainable without serving notice under section 164 of the Maharashtra Cooperative Societies Act, 1960.
Ratio Decidendi: The court held that the agreement entered into between the plaintiff and defendant No. 1 is for redevelopment, which is not the object for which the society was formed, and thus would not be business of the society. Any such dispute arising between plaintiff and defendant no. 1 arising out of redevelopment would not be arising out of the business of the society and thus section 164 of the Maharashtra Cooperative Housing Societies Act, 1960 would not be applicable to the suit filed by the plaintiff.
Final Decision: The court dismissed the Notice of Motion seeking rejection of the plaint.
P.C.
By this motion, the applicants (some of the original defendants) seek rejection of the plaint under Order VII rule 11(d) of the Code of Civil Procedure, 1908. Plaintiffs have filed a suit inter alia praying for declaration that the development agreement dated 21st October, 2007 executed by and between the plaintiffs and defendant no.1 is binding on all the defendants, their servants, agents and any persons claiming through them including all the members of the defendant no.1 society. Plaintiffs have also prayed for order and decree against defendant nos. 2 to 72 to execute their consent for redevelopment in favour of the plaintiffs in terms of the development agreement.
2. This motion has been filed by the applicants on the ground that though in the plaint and in particular paragraph 17, it is averred by the plaintiffs that in view of the urgency in the matter, notice under section 164 of the Maharashtra Cooperative Societies Act, 1960 (hereinafter referred to as the “Said Act”) has not been given to defendant no.1 and that the same be dispensed with, plaintiffs have not applied for dispensing with the said notice. It is submitted that though the plaintiffs have sought reliefs against defendant no.1 society, notice under section 164 of the said Act has not been issued. It is submitted that the notice under section 164 of the said Act is mandatory and cannot be waived and/or dispensed with and this suit is barred under section 164 of the said Act and is liable to be rejected under Order VII rule 11(d) of the Code of Civil Procedure, 1908. Mr. Mehta, the learned counsel for the applicants invited my attention to prayer clause (a) by which the plaintiff seeks declaration that the development agreement entered into between plaintiffs and defendant no.1 is binding on all the defendants including members of defendant no.1. It is submitted that thus prayer (a) in the plaint is barred for want of mandatory notice under section 164 not issued by the plaintiffs before filing of suit. Mr. Mehta, learned counsel placed reliance on the judgment of this court in the case of Suprabhat Coop. Housing Society Ltd. Vs. Span Builders, 2002 (3) Mh. L.J. 837 and in particular paragraphs 7, 8, 9, 10, 12 and 13 in support of his submission that the suit is not maintainable if no notice under section 164 of the said Act was served upon the society and the suit is thus liable to be rejected for want of notice under section 164 of the said Act. The relevant paragraphs read thus :
“7. Section 164 provides that no suit shall be instituted against a society, or any of its office bearers in respect of any act touching the business of the society, until after the expiration of two months after the stipulated notice has been delivered. The notice is to specify the cause of action and the other particulars which are set out in Section 164. The plaint is to then contain a statement that a notice was so delivered.
8. The expression "touching the business of the society", which is employed in Section 164 has also been used in Section 91 of the Act. Section 91, it would be material to note, falls in Chapter IX of the Act which is entitled "Statement of Disputes". Section 91 provides that notwithstanding anything contained in any other law for the time being in force any dispute touching the constitution, elections of the committee or its officers other than elections of committees of specified societies including its officers conduct of general meetings, management or business of a society shall be referred by any of the parties to the dispute to a Cooperative Court if the parties thereto are one or the other of the parties specified in Clauses (a) to (e) of the section. The expression "touching the business of the society" came up for consideration before the Supreme Court in Deccan Merchants v. Dalichand reported in The Supreme Court held that in the context of Section 91, the expression "touching the business of the society" would not mean the a
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