TMI Blog1994 (8) TMI 312X X X X Extracts X X X X X X X X Extracts X X X X ..... ndent Nos. 2 and 3. Respondents Nos. 2 and 3 did not construct any building on the said subplot. Respondent No. 2 sent a letter dated 23-1-79 to the Secretary of the Society stating therein that he intends to sell the said plot No. 31 to Manubhai Kalyanbhai Shah's Hindu Undivided Family of Ashwin Society, Ellis Bridge, Ahmedabad. In the aforesaid letter dated 23-1-79 the respondent No. 2 also mentioned that the Managing Committee of the Society in its meeting held on 20-11-63 had resolved that a transfer fee of ₹ 3,000/- should be paid for getting a plot transferred in the name of the transferee and further that by Resolution dated 14-4-68 the transfer fee was increased to ₹ 5,000/- and on that basis he intended to transfer the aforesaid plot No. 31 to the H.U.F. of Manubhai Kalyanbhai Shah. He also enclosed a cheque of ₹ 5,000/- and share certificates for Membership shares No. 311 to 320 and requested that the same be transferred to the above referred H.U.F. Manubhai Kalyanbhai Shah - also sent a letter to the petitioner-Society written on the very same date, i.e., 23-1-79 stating that he had decided to purchase plot No. 31 from Ramanlal Jeshingbhai Shah, who ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt No. 1 thereupon preferred an Appeal under Section 24 of the Gujarat Co-operative Societies Act, 1961 (which will be hereinafter referred to as the Act ) on 9-7-79 stating that the petitioner-Society had refused to admit him to its Membership in terms of the notice dated 1-5-79. The petitioner-Society appeared before the appellate authority and filed its written objections on 30-8-79 stating that the Appeal may not be entertained. The District Registrar, Co-operative Societies (City Division), Ahmedabad decided this Appeal by his order dated 28-5-80 and directed the petitioner-Society to admit the Respondent No. 1 as the Member of the Society in place of respondent No. 2. Aggrieved from the judgment and order passed by the District Registrar, Co-operative Societies (City Division), Ahmedabad on 28-5-80, petitioner preferred a Revision Application before the Joint Registrar of the Co-operative Societies, Gujarat State, Ahmedabad and this Revision Application was registered at Sr. No. 178 of 1980 under Section 155 of the Act. This Revision Application was heard and decided by the Joint Registrar and he dismissed the Revision Application confirming the order passed by the District ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ice was also sent with the request to accept the amount and transfer the said sub-plot. But the petitioner-Society replied that it was not in a position to transfer the said sub-plot and the cheque was returned to the respondent No. 2. Reference has been made to the order passed by the District Registrar on 8-5-80 in the Appeal and the further order passed on 15-6-81 in the Revision Application. Reference has also been made to the provisions of Section 22 of the Act and it has been prayed that the petition filed by the petitioner-Society was not tenable. 3. On 27-1-82 it was recorded by the Single Bench that vires of Rule 12(2) of the Gujarat Co-operative Societies Rules, 1965 as amended in 1975 being under challenge, the petition be placed before the Division Bench for admission. The Division Bench passed an order to continue the ad-interim relief till further order and the Rule was issued on 9-3-82 with the order that the matter be heard in October, 1982. 4. During the pendency of this Special Civil Application, Civil Application No. 3992 of 1985 was moved by the petitioner alongwith the copy of the death certificate of respondent No. 2 and a copy of Will dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itioner-Society has placed reliance on the following cases: (a) 1984 (2) G.L.R. 1244 Amreli Dist. Co-op. Sale and Purchase Union v. State (b) Damyanti v. Union of India (c) Karvenagar S.G.R. Sanstha Maryadit v. State) (d) Bhandara Dist. Central Co-op. Bank Ltd. v. State of Maharashtra (f) 20 G.L.R. 878 Mulshanker Kunverji v. Juvansinhji (f) Raj Rani v. Delhi Admn. 6. On the other hand Mr. Mihir Joshi, learned Counsel appearing for the respondent No. 1 contended as under: (i) Even if the petitioner-Society is taken to be a tenant-owner Society and assuming that the respondent No. 2 had no ownership right over the plot in question, his right to transfer the plot cannot be dependent at the sweet will of the petitioner-Society and he being the allottee of the plot could certainly transfer his rights in relation to the same to any party subject to the substantial compliance of the requirements of the bye-laws of the petitioner-Society. (ii) The requirements of the bye-laws of the petitioner-Society with regard to the application by respondent No. 1 and the transfer of the plot by respondent No. 2 in favour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erchants Co-op. Bank Ltd. 7. Mr. J.G. Shah, learned Counsel appearing on behalf of respondents Nos. 2/1, 2/2 and 3 at the fag end of the arguments while supporting the arguments of the petitioners on 29-7-94 filed affidavit of one Shri Ashokbhai Babulal Shah, who claimed himself to be the Power of Attorney Holder on behalf of respondents Nos. 2/1 and 2/2 stating therein that respondent No. 2 had filed Civil Suit No. 3391 of 1981 in the City Civil Court at Ahmedabad. Such an affidavit having no direct bearing or any of the points urged before us cannot be entertained at this stage. Hence, we do not find it either necessary or purposeful to take the same into consideration. 8. We have heard learned Counsel for both the sides. Mr. Zaveri heavily relied upon 1984 (2) GLR 1244 (supra) and submitted that the petitioner-Society has an absolute right to deny or refuse Membership to anyone without assigning any reason as it has been held in the aforesaid decision that there is in fact no right, statutory or otherwise, for any person within the area of operation of a cooperative Society to become a member and that it is for the Society to determine as to whether a particula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es not stand to reason to accept the contention of Mr. Zaveri that the petitioner-Society has any such absolute right. When the aggrieved person approaches the Court or the competent authority, there is no basis for the argument that the decision of the Society to admit any one to membership or to deny or refuse the same is not open to challenge. The first contention raised by Mr. Zaveri, therefore, fails and is hereby rejected. 9. Mr. Zaveri referred to bye-law No. 7 of the petitioner-Society. Since Bye-law Nos. 7 and 8 deal with the question of membership, the same are reproduced as under: 7. All persons who have singed the application for Registration are original members. Other members shall be selected by the Committee provided that all members shall belong to the Jain Caste. Two adverse votes are sufficient to exclude an applicant. Every person shall pay ₹ 5/- on applying for admission for which he shall receive a copy of the bye-laws. In case where the application is refused, the entrance fee shall be returned. That no menber shall be allowed to hold a plot or build thereon if he is already a tenant member of another Society. Note: Resident i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dual is narrower in its connotation being one of the units for the purpose of taxation than the word assessee , the word individual has not been defined in the Act and there is authority for the proposition that the word individual does not mean only a human being but is wide enough to include a group of persons forming a unit. The question raised for consideration before the Apex Court in this case was on the construction of Section 16(3) of the Income-Tax Act and it has been held that any group of persons forming a unit is included in the term individual . The view taken by the Supreme Court in this case was also followed in (supra) and in Para 6 of the judgment at page 1273 it has been observed as under: In our view the specific mention of Hindu undivided family in the section does not result in the exclusion of group of individuals who only form a unit by reason of their birth like a Mapilla Tarwad from the operation of the section. It is difficult to accept the argument that if term Individual was intended to include joint families or Undivided Families it was redundant to specify Hindu undivided families. It has been further observed in par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ara 32 that the conclusion was, therefore, inescapable that the property of a Hindu Undivided Family is within the ambit of Entry 86 and it is the property of the individuals who are members or coparceners of the joint family. It has been further held that, it must follow, therefore, that it was within the competence of the Union Legislature to impose wealth tax on the Hindu Undivided Family as a unit of taxation and that the impugned legislation in Section 3 of the Wealth Tax Act, 1957, affecting a Hindu Undivided Family cannot be struck down on the score of vires. In AIR 1940 Madras 612 (supra) it was held by the Full Bench of Madras High Court that a co-operative society registered under the Indian Co-operative Societies Act was an individual within the meaning of the Indian Income-Tax Act and the Bombay High Court in AIR 1960 Bombay 7P7(supra) has taken the view that there is not only no settled legislative practice as to the meaning of the expression individual in taxing statutes, but there is not even unanimity of judicial opinion as to the meaning of that expression in the Indian Income-tax Act and the Court was unable to hold that the expression individuals used in d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... However, we have considered the import of this decision while appreciating the contention No. 1 with regard to the petitioner-Society's absolute right to deny or refuse membership; its validity has to be examined on the anvil and scope of the right claimed by the petitioner-Society under Article 19(1)(c) of the Constitution of India. There is no room for doubt that the said Article gives the right to form association and no fetters can be imposed on such a right. The contention of Mr. Zaveri is that any check on the Society's right on the question of admitting, denying or refusing membership will be violative of the right to form Association and according to him, his contention is fully covered by the decision of the Gujarat High Court in Amreli District Co-operative Sale and Purchase Union Ltd. 's case (supra) and he strenuously argued that when Sections 22(2) and 24 of the Act has been struck down by the Division Bench, Rule 12(2) of the Rules also should be struck down. He submitted that it depends upon the sweet will of the Society to admit or deny or refuse membership to any person without assigning any reason and even if no reason is given, such a decision is beyo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by statute, they are controlled by statute and so, there can be no objection to statutory interference with their composition on the ground of contravention of the individual right of freedom of association. Thus, we are fortified in our view on the strength of the decision of the Supreme Court in Daman Singh's case (supra) particularly having regard to the observations made in para 9 thereof that so far as the composition of the co-operative society is concerned, there cannot be any objection to statutory interference. The composition of the co-operative society certainly covers the issue with regard to the membership and the right of the society to admit, refuse or deny such membership and such decision is also amenable to statutory interference as has been held by the Supreme Court. We, therefore, agree with the contention of Mr. Joshi that the provisions of Rule 12(2) of the Rules regulate the composition of the Society. Language of Rule 12(2) also makes die transfer of the plot permissible and provides that no co-operative society shall without sufficient cause refuse membership to any person duly qualified under the Act, Rules and the bye-laws and if the exist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Transfer is reproduced as under: FORM OF TRANSFER This instrument made the__________day of_________19 between A of___________and B of_________the witnesses that in consideration of the sum of Rs.__________ paid by the said B to me, I, the said A, hereby transfer to the said B, his executors administrators and assigns the_________shares________numbered, now standing in my name in the books of the above named Society to hold the said shares upon the same conditions on which I now hold the same; and that I, the said B, hereby accept the said shares, subject to the said conditions. In witness whereof we have hereunto set our hands. (Name of Transferor) (Name of Transferee) Principally there cannot be any dispute to the proposition that members of any cooperative society have to conform to the bye-laws and any person desirous of becoming a member of co-operative society shall follow the bye-laws and, therefore, while we agree principally with Mr. Zaveri on this question, we find from the perusal of the documents, which have been annexed with the petition as Annexures 2 and 3, mat all necessary information which were required for the purpose of membership and for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion may find it difficult to be elected to the committee in which the entire power of management vests. It was further held that absence of representation coupled with subjection to the dictates of the society would be antithesis of democratic process reducing such persons to serfdom. It was further held that this democratic process must permeate in filling in reserved seats otherwise the committee would not enjoy a representative character. Reference has been made to Part XVI of the Constitution and especially ArticleS 330 and 332, which provide for reservation of the seats in the House of People and in the Legislative Assembly of every State for the Scheduled Castes and the Scheduled Tribes. The Supreme Court has further held that to make the democratic institutions fully representative, reservation of seats has to be made for those who on account of their backwardness, exploitation and unjust treatment both social and economic cannot obtain representation because of the class domination. The Supreme Court has also made reference to Heydon's test more often noticed that in order to arrive at true intendment of a statute, the Court should pose to itself the questions: (1) wha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontext of granting membership and the right to transfer to the member of the co-operative society. After considering the scheme of the Act and the bye-laws, the Supreme Court has observed that the member may not transfer his interest in the property prior to one year and and transfer is made to an existing member of the Society or to a person whose application for membership has been accepted by the Society and in the case at hand there is nothing to show contravention of bye-laws and according to the Supreme Court there is no reason to think that mere is any question of refusal of membership of the Society to a non-member if he is qualified otherwise and makes an appropriate application in which case the transfer of shares will be operative and thus the assignment of the right to occupation will hold good. The Supreme Court further held that this species of property, namely, the right to occupy, assumed significant importance and acquires under the law a stamp of transferability in furtherance of the interest of commerce and there is no fetter under any of the legal provisions against granting membership. The right to occupation has been held to be a property both attachable and s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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