High Court Of Madhya Pradesh
A. G. QURESHI, M. W. Deo
INDIAN SECTION, THEOSOPHICAL SOCIETY, VARANASI - Appellant
Versus
STATE OF MADHYA PRADESH - Respondents
MISC. PETN. 1533 Of 1992
Decided On : 12/01/1993
URBAN LAND (CEILING AND REGULATION) ACT, 1976 - SECTION 19(1)(VII) - EXEMPTION FROM PROVISIONS OF CHAPTER III - SOCIETY REGISTERED UNDER SOCIETIES REGISTRATION ACT, 1860 - SALE OF LAND BY SOCIETY - VALIDITY - NOTIFICATION ISSUED BY COMPETENT AUTHORITY SEEKING CANCELLATION OF EXEMPTION GRANTED TO SOCIETY - JURISDICTION - REVIEW OF EARLIER ORDER - POWER NOT CONFERRED BY ACT - NOTICES ISSUED WITHOUT JURISDICTION.
Fact of the Case:
Petitioner society, registered under the Societies Registration Act, 1860, owned land in Indore. The society sold a portion of the land to petitioners 2 to 6. The competent authority had earlier granted an exemption certificate to the society under Section 19(1)(vii) of the Urban Land (Ceiling and Regulation) Act, 1976, declaring that the provisions of Chapter III of the Act were not applicable to the society. The competent authority issued notices to the society seeking cancellation of the exemption certificate on the ground that the sale of land by the society was against the objects of the society.
Finding of the Court:
The court held that the notices issued by the competent authority were without jurisdiction. The court found that the provisions of Chapter III of the Act were not applicable to the society by virtue of Section 19(1)(vii) of the Act, which exempts societies registered under the Societies Registration Act, 1860, and used for any non-profit and non-commercial purpose. The court also held that the transfer of land by the society was within the objects of the society and that the funds derived by the society had to be used for non-profit and non-commercial purposes.
Issues: 1. Whether the competent authority had jurisdiction to review its earlier order granting an exemption certificate to the society? 2. Whether the sale of land by the society was against the objects of the society?
Ratio Decidendi: 1. The court held that the competent authority did not have jurisdiction to review its earlier order granting an exemption certificate to the society because the Act did not confer such power on the authority. 2. The court held that the sale of land by the society was not against the objects of the society because the society was entitled to sell, make improvement or develop all or any part of the property of the Association and the sale proceeds had to be used for non-profit and non-commercial purposes.
Final Decision: The court allowed the petition and quashed the notices issued by the competent authority seeking cancellation of the exemption certificate granted to the society.
( 1 ) THE Petitioner no. 1 in the present petition is a society formed in 1903 and is registered under the Societies Registration act, bearing registration no 105 dated 31-8 -1903. The petitioners nos 2 to 6 are purchasers of part of the land belonging to the petitioner no 1 society which was sold to them by registered sale deed dated 20 12 1991. The petitioners owned and possessed open land situated at R. N. Tagore marg, Indore with a small superstructure admeasuring about 100761 sq. ft. The land devolved on the petitioner no. 1 by registered release deed dated 10-11-1960 bearing no 1762. The petitioner no. 1 applied for the sanction of a site plan to the Municipal Corporation, Indore but before the sanction of the plan the Municipal Corporation authorities insisted on a no objection certificate from the competent officer. The petition no. 1 therefore, made an application to the competent authority saying that althouh the provisions of Section 6 ot the Urban Land (Ceiling and Regulations) Act, 1976 (hereinafter called the Act) do not apply to petitioner no 1 as it is a registered society, still it wants a certificate in view of the requirement of the Municipal Corporation, Tndore therefore, a certificate under the Act be granted to them under Section 19 (1) (vii ). After an equiry the same was granted to petitioner no. 1, vide order dated 6- 6-86, whieh is Annexure-P 4 to the petition. Thereafter the petitioner no. 1 sold about 50. 000 sq ft. of land from the land belonging to the petitioner to petitioners nos. 2 to 6 by registered sale deed execution 20 12. 91 (Annexure p 3 ). The competent authority has issued notice dated 24. 8. 92 and letter dated 5 9 92 to petitioner no. 1 aggrieved ty which they have filed this petition challenging the notice seeking the cancellation of the certificate annexure-P4 granted to the society.
( 2 ) THE grievance of the petitioners is that the petitioner no. 1 being a society falling within the purview of Section 19 of the Act, the provisions of Chapter-Ill of the Act are not applicable to the petitioner society and therefore, it was not necessary for the petitioner-society to file any return under S. 6 of the Act. However, on the insistence of the Municipal Corporation, Indore an application for exemption was filed, which was righly allowed by the competent authority and the building plans were also sanctioned by the Municipal corporation, indore and the construction had already been started notices Annexures-P7 and P-9 sent by the authorities are without jurisdiction for two reasons one that the society falls under Section 19 (1) (vii) of the act, as the society has been registered for non-profit and non-commercial purposes and the sale proceeds shall also be used for non-commercial and non-profitable purposes. The Art:cles and Rules of the society also permit the sale of any property of the society for being used to carry on the society. Therefore, the society is automatically exempt by the Statutory clause Secondly, when once the exemption was granted by the authority after holding a detailed enquiry, the notice for reviewing the same is clearly without jurisdiction because power of review has not been given to any authority under the Act and it is a settled principle of law that if under an enactment a power of review is not given to any authority, the power of review cannot be exercised therefore, on both the aforesaid reasons the notices issued by the competent Authority are without jurisdiction aid, therefore, they be quashed.
( 3 ) THE State has resisted the petition mainly on the ground that the and once transferred by the society attracts the provisions of tas Act because the land of the socieiy is exempt from the Act only till it is with the society. Jf it is used, not for tne purpose of the society a-id for some other purpose, the exemption automatically comes u an jnd. It. las also been pjeaded that he socieiy had no right to sell the land without seeking permi
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