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1996 Supreme(Del) 227

High Court Of Delhi
ALIMUDDIN - Appellant
Versus
REGISTRAR OF CO-OPERATIVE SOCIETIES - Respondent
Decided On : 02/29/1996

Rule 25 (1) (c) (i) of the Delhi Cooperative Societies Rules, 1973 must be strictly construed and applies only in cases where the member of the society owns a residential house or a plot of land in his own name or in the name of his spouse or a dependent child.

Headnote:

CO-OPERATIVE SOCIETY - MEMBERSHIP - DISQUALIFICATION - PURCHASE OF PLOT BY WIFE OF MEMBER THROUGH POWER OF ATTORNEY - WHETHER ATTRACTS DISQUALIFICATION UNDER RULE 25 (3) OF DELHI CO-OPERATIVE SOCIETIES RULES, 1973 - INTERPRETATION OF RULE 25 (1) (C) (I) - OWNERSHIP OF PROPERTY - MEANING.

Fact of the Case:

The petitioner, a member of a cooperative society, was disqualified from membership on the ground that his wife had purchased a plot in an unauthorized colony in Delhi, which rendered him disqualified under Rule 25 (3) of the Delhi Cooperative Societies Rules, 1973. The petitioner contended that a power of attorney only gives power to act on behalf of someone else and does not confer ownership of the property.

Finding of the Court:

The court held that the Registrar of Cooperative Societies and the Lt. Governor erred in their interpretation of Rule 25 (1) (c) (i) and that the petitioner's membership could not be disqualified based on his wife's purchase of the plot through a power of attorney.

Issues: Whether the purchase of a plot by the wife of a member of a cooperative society through a power of attorney attracts disqualification under Rule 25 (3) of the Delhi Cooperative Societies Rules, 1973.

Ratio Decidendi: The court interpreted Rule 25 (1) (c) (i) strictly and held that it applies only in cases where the member of the society owns a residential house or a plot of land in his own name or in the name of his spouse or a dependent child. The phrase "in the name of" was interpreted to mean that the ownership must be of the member, even if it stands benami in the name of the wife or a child.

Final Decision: The court quashed the orders of the Registrar of Cooperative Societies and the Lt. Governor and remanded the matter back to the Registrar for a fresh decision in light of the court's interpretation of Rule 25 (1) (c) (i).

R. C. Lahoti

( 1 ) A short question relating to interpretation of Ruls 25 (l) (c) Delhi Co-operative Societies Rules, 1973 (hereinafter referred to as the Rules ) arises for decision in this petition.

( 2 ) THE petitioner Alimuddin, was a member of Panjatan Cooperative House Building Society Ltd. His membership in the Society has been ceased on the ground that during his membership of the Society, his wife had purchased a plot in one of the unauthorised colonies of Delhi, namely, Zafar Nagar and this act had rendered him disqualified to continue as a member of the Society under Rule 25 (3) of the Rules.

( 3 ) THE facts found by the Registrar, Cooperative Societies and as contained in her order dated 16. 8. 1991, (Annexure-D), are that one Pyarey Lal had executed a power of attorney in favour of the wife of the petitioner in respect of the said plot and later on she had executed another power of attorney in favour of some other parties for the same plot. The petitioner s defence was that a power of attorney only gives power to act on behalf of some one else and the power attorney holder does not acquire any ownership in the property forming subject matter of the power of attorney. It was also submitted that the petitioner s wife had only entered into an agreement for sale of the said plot but she had never purchased it through a registered document and, therefore, she never legally owned it and therefore Rule 25 (3) of the Rules was not attracted. The Registrar of the Co-operative Society found that the transaction entered through power of attorney gave an outwardly different colour to the transaction but in substance and in effect she did acquire a plot for her own benefit and that was a transfer in her favour. The learned Registrar further opined that Sec. 25 (3) had a social objective, viz. to make available a plot or a house to as many needy people as possible and this objective could not be permitted to be defeated by resort to legal technicality and avoid disqualification under Sec. 25 (3 ). The learned Registrar concluded by upholding the Society s action ceasing the membership of the petitioner as right and proper.

( 4 ) THE order of the Registrar has been upheld in the revision by the Lt. Governor, who has recorded the following finding:-

"it has been admitted on behalf of the petitioner that a power of attorney coupled with monetary consideration was executed by Shri Pyare Lal in favour of the petitioner s wife in 1970. It was also accepted on behalf of the petitioner that another power of attorney coupled with monetary consideration was executed by his wife in favour of certain persons on 18. 3. 1976. There was also an affidavit where the petitioner s wife had sworn that "i have sold plot No. 185, Zakir Nagar and that I have no objection if the said property is transferred in the name of the purchaser". All this goes to show that the petitioner s wife has been indulging in the purchase and sale of property howsoever described. In the circumstances, the Registrar found it necessary to invoke the provisions of Rule 25 (3) and hold that by entering into purchase and sale agreement with monetary consideration alongwith an irrevocable power of attorney in the name of his wife, the petitioner has incurred a disqualification. "

( 5 ) THE learned Counsel for the petitioner has rightly pointed out that the views of the Registrar and the Lt. Governor cannot be sustained in the light of at least three decisions of this Court interpreting the provisions of Rule, 25 (1 ) (c) and 25 (3 ). These decisions are : O. P. Sethi v. Lt. Governor, 45 (1991) DLT 426, Navjeevan Cooperative House Building Society Ltd. v. Delhi Co-operative Tribunal, CWP 3150/ 85 decided on 10. 7. 87 and Shri Sita Ram Jain v. Registrar of Co-operative Societies, CWP 3203/92 decided on 15. 11. 1995. The decision in Navjeevan Co-operative House Building Society Ltd. is the first in point of time and has been followed in the later two decisions. In that case, a le









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