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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
Abhilasha Kumari, J.
Ambica Nager Co-op. Housing Society Ltd. and Ors. – Appellant
Vs.
Gujarat State Co-op. Housing Finance Corporation Ltd. and Ors. – Respondent
Special Civil Application Nos. 2628 and 2629 of 2012
Decided On : 01-07-2016
Gujarat Cooperative Societies Act, 1961 – Sections 99, 150 – Code of Civil Procedure, 1908 – Order-37 – Gujarat Co-operative Societies Rules, 1965 – Rule 41A – Constitution of India – Articles 226, 227 – Conditional leave to defend – Petitioners are aggrieved by the impugned common judgment passed by the Board of Nominees, the third respondent herein, as upheld by the Gujarat State Co-operative Tribunal, the second respondent, whereby conditional leave to defend the respective Summary Lavad Suits filed by the first respondent, the Gujarat State Co-operative Housing Finance Corporation Limited, has been granted on the payment of 20% of the amount claimed – Held, Objections regarding non-joinder of a party or a discrepancy in the loan amount as per the contention of the petitioners cannot supercede the power of the Board of Nominees in granting conditional leave to defend and can be considered during the proceedings – Cumulative effect of the above discussion is that the Board of Nominees has not committed any error of law while imposing a condition of the deposit of 20% of the amount claimed while granting leave to defend to the petitioners – Impugned judgment of the Board Nominees does not require interference from this Court – Petitions Rejected (Paras 33, 34, 35)
Abhilasha Kumari, J.
1. Both these writ petitions filed under Articles 226 and 227 of the Constitution of India raise identical issues. As they were heard together, they are being decided by a common judgment.
2. The petitioners are aggrieved by the impugned common judgment passed by the Board of Nominees, the third respondent herein, as upheld by the Gujarat State Co-operative Tribunal, the second respondent, whereby conditional leave to defend the respective Summary Lavad Suits filed by the first respondent, the Gujarat State Co-operative Housing Finance Corporation Limited, has been granted on the payment of 20% of the amount claimed.
3. For the sake of convenience, the facts as obtain in Special Civil Application No. 2628 of 2012, may be noticed first. Petitioner No. 1, Ambika Nagar Cooperative Housing Society, is a Co-operative Society registered under the provisions of the Gujarat Cooperative Societies Act, 1961 ('the Act' for short) and the Rules framed thereunder. Petitioner No. 2 is the President of petitioner No. 1. The first respondent filed Summary Lavad Suit No. 531 of 2005 under Section 99(4) of the Act before the third respondent against the petitioners, for the recovery of an amount of Rs. 2,51,18,831.54 paisa. Respondent No. 1 had advanced finance to the petitioners for the construction of tenements which were allotted to sixty-three members of petitioner No. 1 Society. The loan advanced was to the tune of Rs. 59,82,000/-. The construction of residential units was to be undertaken under the HUDCO Project, on the terms and conditions stated therein. The loan amount was required to be repaid upon completion of the construction of the residential units. To secure the loan amount, the petitioners had mortgaged land bearing Survey Nos. 441 TO 444, admeasuring 11904 sq. meters upon which 90 residential units were constructed, vide registered Mortgage Deed dated 05.09.1988, in favour of the first respondent. Upon service of summons in the Summary Lavad Suit, the petitioners/defendants appeared before the third respondent and filed an application seeking unconditional leave to defend the suit. The defence put up by the petitioners was that the mortgaged property was sub-mortgaged to HUDCO by the first respondent/plaintiff, therefore, HUDCO is a necessary party to the proceedings. In the absence of HUDCO, the suit is not maintainable. It was also stated by the petitioners that HUDCO had approached the Debt Recovery Tribunal, Ahmedabad (DRT) by filing Original Application No. 248 of 2005 against the petitioners and the first respondent, to recover the outstanding amount arising from the same loan transactions. It was alleged by the petitioners that the first respondent had suppressed this fact in the suit. The first respondent filed a counter affidavit to the application for leave to defend preferred by the petitioners. After considering the rival stands of parties, the third respondent passed the impugned order dated 05.03.2008, below Exh. 23, granting conditional leave to defend the Summary Lavad Suit upon the deposit of 20% of the amount. Aggrieved by the said order, the petitioners filed Revision Application No. 41 of 2008 under Section 150(9) of the Act, before the second respondent Tribunal, which has been rejected by the impugned order dated 05.01.2012.
4. The factual matrix of Special Civil Application No. 2629 of 2012 is almost similar. The petitioner No. 1 Virat Nagar Co-operative Housing Society, had taken a loan of Rs. 17,22,000/- from the first respondent by mortgaging land bearing Survey Nos. 442 and 475/A paiki, admeasuring 6065 sq. meters, upon which sixty-three residential units were constructed by way of a registered Mortgage Deed dated 05.09.1988. In the Summary Lavad Suit No. 532 of 2005 filed by the first respondent, the petitioners filed an application for leave to defend. The third respondent, vide the order dated 05.03.2008, granted conditional leave to defend upon the payment of 20% of the
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