TMI Blog2018 (9) TMI 837X X X X Extracts X X X X X X X X Extracts X X X X ..... lge into profiteering business from the members and if such amount is earned, then it is taxable under the law. There is no bar for any member to pay donation to the Society, however, it should be voluntary without any compulsion and coercion. No manner the transfer fees can be charged under the pretext of donation. The payment was made by two demand drafts of ₹ 2,50,000/- each on 27th April, 2005 and the said payment was challenged on 29th December, 2005 by filing Dispute No. 398 of 2005 before the Cooperative Court on the ground that it was paid under coercion. Thus, from this conduct of taking immediate steps against the Society and challenging the said transaction, it can be safely concluded that the amount was not a donation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... % interest from 29th December, 2005 till realization of the amount. The said order is challenged by the petitioner-Housing Society. The respondents/original disputants were alloted plot No. 59 during the membership. Due to some violation of the conditions, the Society threatened to dispossess so the respondents filed Dispute No. 223 of 2000, which was compromised by filing consent terms and they agreed to deposit ₹ 50000/- by way of security for completion of construction of the bungalow within three years. Thereafter, the respondents were in dire need of the money and therefore, they decided to sell the flat to third party and for the sale, they agreed to pay transfer fees of ₹ 25,000/- to the Society. However, they alleged tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Cooperative Housing Society Ltd. Anr. vs. Smt. Krishna H. Bajaj Ors., pronounced on 17th February, 2010. 4. Per contra, the learned counsel for the respondents has submitted that the Society cannot demand any transfer fees more than ₹ 25,000/- which is fixed as per the bye-laws No. 38 and section 38(e)(ix) of the Cooperative Housing Society, i.e., Notice of transfer of shares and interest in the capital/property of the Society . He also relied on the Circular issued on 9th August, 2001 by the Government in respect of transfer fee by which the transfer fee of the immovable property within the Corporation limit is fixed as ₹ 25,000/- and the said circular is still in force. The learned counsel has submitted that the res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x as it has an element of profiteering. 6. In the present case, the question is whether the amount of ₹ 5,00,000/- was paid voluntarily towards donation. While deciding this, one has to see who is in advantageous or dominant position. 7. In the case of Bharatiya Bhavan Cooperative Housing Society Ltd. (supra), similar issue of payment to the Society by the member was before the Single Judge of this Court. However, in the said matter, the member and Society have entered into written agreement and the Judge has held that the member cannot fall within the protective umbrella of Section 72 of Contract Act if the party with knowledge enters into void agreement for some illegal act, then she would not get protection under sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. The incoming and outgoing member both are having a subordinate position and the Society enjoys a dominant status in transfer of the premises. The incoming member somehow wants the possession of the premises and share certificate to be transferred in his name without any hassle. So also outgoing member, who is in need of money, wants to get rid of further complications and is interested in smooth transaction. For this reason, the consent of Managing Body by passing necessary resolution to that effect is required. Under such circumstances, it cannot be inferred that the outgoing/incoming member has paid the donation voluntarily. In the present case, though the respondents have given admission that they paid ₹ 5,00,000/- towards donat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er sq.ft. after adjusting the deposit amount of ₹ 50,000/- which was paid to the Society earlier by way of compromise. The payment was made by two demand drafts of ₹ 2,50,000/- each on 27th April, 2005 and the said payment was challenged on 29th December, 2005 by filing Dispute No. 398 of 2005 before the Cooperative Court on the ground that it was paid under coercion. Thus, from this conduct of taking immediate steps against the Society and challenging the said transaction, it can be safely concluded that the amount was not a donation but money was a transfer fee paid out of compulsion and it was not voluntary payment. 11. This Writ Petition is dismissed, however, with following modification in the rate of interest: Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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