Velagacharla Jayaram Reddy vs M.Venkata Ramana

Velagacharla Jayaram Reddy vs M.Venkata Ramana

REPORTABLE

   IN THE SUPREME COURT OF INDIA

   CIVIL APPELLATE JURISDICTION

   CIVIL APPEAL NOS.11015­11016 OF 2017  

Velagacharla Jayaram Reddy & Ors.             .…Appellant(s)

Versus

  M.Venkata Ramana & Ors .Etc.              ….Respondent(s)

J U D G M E N T

A.S. Bopanna,J.

1. The   respondents   No.4,   6   and   7   in   W.P.

No.6212/2006 are before this Court in this appeal. They

claim   to   be   aggrieved   by   the   order   dated   20.04.2010

passed by the High Court of Judicature, Andhra Pradesh

at Hyderabad. By the said order, the learned Division

Bench of the High Court has allowed the writ petition and

quashed   the   award   dated   28.01.2004   passed   by   the

Divisional Co­operative Officer, Cuddapah acting as an

1

Arbitrator in deciding the dispute raised under Section

61(1) (b) of the Andhra Pradesh Co­operative Societies

Act, 1964 (“APCS Act” for short). The said award had

been   affirmed   by   the   Andhra   Pradesh   Co­operative

Tribunal   at   Hyderabad,   through   its   judgment   dated

27.02.2006. 

2. The   facts   necessary   to   be   noted   for   disposal   of

these appeals are as follows:­ The Government of Andhra

Pradesh   through   its   G.O.   Ms.   No.956,   Revenue

Department, dated 22.08.1970, allotted land situate in

Sy.No.752/2 and 91/1, Kondayapalli Tank bund to the

N.G.O. Co­operative Building Society Ltd. for the purpose

of formation of Layout and to allot sites to its members.

The area was within the jurisdiction of Chinnachowk,

Gram   Panchayat   at   that   point   in   time.   The   said

Panchayat   was   later   on   merged   in   the   Municipal

Corporation,   Kadapa,  which  presently   has   jurisdiction

over the area.

2

3. There is not much dispute to the fact that in the

said land a layout was formed and 625 members were

allotted plots. The layout also consisted of specific areas

earmarked for parks, playground, school, religious place,

shopping   area   and   parking   place.   The   instant   appeal

relates to the respective plots which were allotted to the

respondents No.1 in C.A.No.11015 and 11016/2017. The

respondent   No.1   in   C.A.   No.11016/2017   who   died

subsequently, was deleted from the array of parties. As

such, the entire consideration in this appeal is limited to

the plot measuring 3.2 cents allotted to the respondent

No.1 (Mr. M.V. Ramana) in C.A. No.11015/2017. Since

there has been an amendment to the cause title and

certain   parties   who   were   parties   to   the   original

proceedings   before   the   Divisional   Co­operative   Officer

have been deleted, henceforth the parties will be referred

to   in   the   rank   they   were   arrayed   in   the   original

proceedings for completeness and clarity.

3

4. The   plaintiffs   before   the   Divisional   Co­operative

Officer raised a grievance with regard to the allotment of

plot   to   defendant   No.2   therein   (Mr.   M.V.   Ramana)

alleging that the said plot was reserved as parking area

in   the   layout   plan.   The   plaintiffs   were,   a   Welfare

Association which was a part of the same layout, former

President and Vice­President of the N.G.O Society which

allotted the plot and a couple i.e. plaintiff Nos.4 and 5

who own shop premises in the layout which is situated

opposite the plot in issue. The said plaintiffs No.4 and 5

are not members but were persons who were interested

in   purchasing   the   same   plot   that   was   allotted   to

defendant No.2, ostensibly to retain the same as parking

area in front of their shops on plot Nos.27, 35 and 36. 

5. The Divisional Co­operative Officer, on perusal of

the material and evidence, noted the said plot to be a

vacant commercial plot as denoted in the plan. However,

on providing his own analysis, he has proceeded to term

4

the plot in issue as a ‘parking area’ and has accordingly

passed   the   award   dated   28.01.2004   in   favour   of   the

plaintiffs.   The   defendants,   more   particularly,   the

respondent herein (Mr. M.V. Ramana)  filed an  appeal

before   the   Andhra   Pradesh   Co­operative   Tribunal   at

Hyderabad,   which   affirmed   the   award   through   its

judgment dated 27.02.2006. The respondent filed a writ

petition before the High Court assailing the order dated

24.04.2010 in W.P.No.212/2006. The High Court on a

detailed consideration, more particularly with regard to

maintainability   of   a   proceeding   of   the   present   nature

before   the   Co­operative   Officer,   held   it   against   the

appellants herein, allowed the writ petition and set aside

the award of the Divisional Co­operative Officer as also

the order of the Co­operative Tribunal. The appellants

are therefore aggrieved by the order passed by the High

Court.

6. We have heard Mr. B. Narayana Reddy, learned

senior   counsel   for   appellants,   Mr.   Annam   D.N.   Rao,

5

learned   counsel   for   the   respondent   No.1   and   Mr.   K.

Ravindra Kumar, learned Senior Counsel appearing for

respondent No.5 and perused the materials available on

record.

7.  From a perusal of the proceedings, it is noted that

the   appellant   along   with   the   others   had   raised   the

dispute   before   the   Divisional   Co­operative   Officer

invoking Section 61 of the APCS Act. The said provision

reads as hereunder:

“61.   Disputes   which   may   be   referred   to   the

Registrar: ­

(1) Notwithstanding anything in any law for the

time being in force, if any dispute touching the

constitution,   management   or   the   business   of   a

society, other than a dispute regarding disciplinary

action   taken   by   the   society   or   its   committee

against a paid employee of the society, arises­

(a) among members, past members and persons

claiming   through   members,   past   members   and

deceased members; or (b) between a member, past

member  or   person   claiming  through   a   member,

past member or deceased member and the society,

its committee or any officer, agent or employee of

the   society;   or   (c)   between   the   society   or   its

committee, and any past committee, any officer,

agent or employee, or any past officer, past agent

or   past   employee   or   the   nominee,   heir   or   legal

representative   of   any   deceased   officer,   deceased

agent or deceased employee of the society; or (d)

6

between the society and any other society, such

dispute   shall   be   referred   to   the   Registrar   for

decision.

Explanation: ­ For the purposes of this sub­section

a dispute shall include­ (i) a claim by a society for

any debt or other amount due to it from a member,

past   member,   the   nominee,   heir   or   legal

representative   of   a   deceased   member,   whether

such debt or other amount be admitted or not; 

(ii) a claim by surety against the principal debtor

where the society has recovered from the surety

any amount in respect of any debt or other amount

due to it from the principal debtor as a result of

the default of the principal debtor whether such

debt or other amount due to be admitted or not;

  (iii) a claim by a society against a member, past

member,   or   the   nominee,   heir   or   legal

representative   of   a   deceased   member   for   the

delivery   of   possession   to   the   society   of   land   or

other immovable property resumed by it for breach

of   the   conditions   of   assignment   or   allotment   of

such land or other immovable property;

(xxx)

(2)   If   any   question   arises   whether   a   dispute

referred to the Registrar under this section is a

dispute touching the constitution, management or

the business of a society, such question shall be

decided by the Registrar.

[(3)   Every   dispute   relating   to,   or   in   connection

with, any election to a committee of a society shall

be   referred   for   decision   to   the   Tribunal   having

jurisdiction over the place where the main office of

the   society   is   situated,   whose   decision   thereon

shall be final.]

(4) Every dispute relating to, or in connection with

any election 2 [shall be referred under sub­section

7

(3) only after the date of declaration of the result of

such election.]”

8. The Act has made a provision for members of a Cooperative   Society   to   approach   the   co­operative   Officer

designated,   when   there   is   a   dispute   amongst   the

members of a society or the member/members against

the Society etc.

9.  In the instant case, at this stage before this Court,

certain parties have been deleted as indicated supra and

the appellant who was a former President of the Society

is alone prosecuting these appeals. However, what will

have to be noted is the frame of the dispute, the parties

to the dispute at the point in time when it was raised and

the  context  in which  it was done. Defendant No.2, a

member of the society who was allotted a plot in another

layout   formed   by   the   N.G.O.   Society,   sought   for   an

exchange of the plot. Accordingly, the earlier allotted plot

was surrendered to the Society by the defendant No.2. In

lieu thereof, the Society allotted the plot measuring 3.25

8

cents   to   defendant   No.2   and   a   sale   deed   dated

07.04.2000  was  also   executed  and   registered.  Former

office bearers of the Society who were members of the

N.G.O society, were amongst the plaintiffs. Jayanagar

Housing   Welfare   Society   was   a   society   in   the   larger

layout plan and therefore seeking to sustain the facilities

available   in   the   layout   by   contending   that   the   plot

allotted to the defendant No.2 was a vacant area reserved

as parking area. Plaintiffs No.4 and 5 were however not

the   members   of   the   Society   but   were   purchasers   of

commercial   plots   bearing   No.   27,   35,   36   and   had

constructed   shops   thereon.   The   plot   allotted   to   the

defendant No.2 is located in front of the shops belonging

to the plaintiffs No.4 and 5 in plots No.27, 35 and 36.

Though they contend that it is a vacant plot retained in

the layout as parking area and are seeking to espouse a

cause, their conduct needs to be noted. They had earlier

requested   the   NGO   Society   to   allot   the   plot   in   their

9

favour but are presently aggrieved when it is allotted to

another claimant. 

10. Plaintiffs No.4 and 5 however seek to explain their

conduct by stating that they had sought to purchase the

plot and retain it as a parking area. Such an explanation

cannot be accepted on face value. If in fact a plot was

earmarked in the layout plan as a parking area, it is the

bounden duty of the authorities concerned to maintain

the same as such. It is difficult to fathom that a private

individual who owns shop premises in the layout would

invest money and purchase the vacant plot to retain it as

a parking area for the benefit of the general public. If

that be so, plaintiffs No.4 and 5 apart from being nonmembers who could not have invoked the provisions of

the APCS Act, were also rival claimants and competitors

for allotment of the same plot which is the subject matter

of dispute. The members i.e. former office bearers had

made a common case with the non­members who were

otherwise interested in allotment of the same plot. In

10

furtherance of the same, the plaintiffs had sought for a

declaratory relief to declare the registered sale deed dated

07.04.2000   as   null   and   void.   Hence,   keeping   in

perspective the subject matter, the relief sought and the

parties   involved,   the   High   Court   was   justified   in   its

conclusion.

11. Be   that   as   it   may,   whether   it   was   before   the

authorities under the A.P.C.S Act or if the parties were

relegated   to   the   jurisdictional   Court   under   the   Civil

Procedure Code, grant of relief would have arisen only if

there was definite material to indicate that the plot in

question was reserved as a parking area in the layout

plan and that the same therefore being a civic amenity

area,   had   on   formation   of   the   layout,   vested   in   the

Municipal Corporation along with the roads, drains and

open areas for the purpose of retaining it as such and

maintaining the same. There is no such document on

record.   Secondly,   the   person   seeking   relief   from   the

Court should approach the Court with clean hands, as

11

per   well­established   legal   norms.   In   the   instant   case,

plaintiffs   No.4   and   5   had   made   attempts   to   secure

allotment of the same plot allotted to the defendant No.2,

in   their   favour   though   presently,   it   is   sought   to   be

explained that it was to be retained for parking, which,

as   already   indicated   above,   is   an   explanation   which

cannot be accepted. Therefore, the challenge by the said

plaintiffs   to   the   allotment   made   in   favour   of   the

defendant and the same cause being supported by the

other plaintiffs, cannot be considered to be bonafide.

12. That apart, as noted, there is no definite material

to delineate from the layout plan that it was a parking

area.   As   per   the   case   set   up   and   also   the   finding

recorded   by   the  original  authority,   the   plot   has  been

shown as commercial plot/vacant plot. Keeping in view

the location of the property owned by the plaintiffs No.4

and 5, the original authority had deemed it fit to keep the

disputed plot vacant for being maintained as a parking

area which is only an assumption based on the own

12

analogy   of   the   Divisional   Co­operative   Officer   and

amounts   to   modifying   the   approved   layout   plan.   The

consideration   in   that   regard   made   by   the   original

authority, based on the said assumption is as hereunder:

­

“(27)   In   order   to   conclude   that   the   vacant   site

shown as the southern boundary was meant only

to be a parking place although recited as vacant

place the following points may well be appreciated.

a) On the southern side of the shop rooms,

particularly for the plots 27, 36 and 35

there is no other place to connect with

the road. 

b)   For   visitors   coming   to   the   shopping

complex by  bicycles,  scooters,  or  cars

there  must be  some space  for parking

the vehicles, particularly because it is

obviously   a   commercial   area.   Vacant

site  viewed in  the  proper  context  and

from   a   correct   perspective   means

necessarily   a   parking   place   because

parking   place   is   a   ‘must’   in   a

commercial area.

c)     The   Sub­Divisional   Cooperative   officer

who   was   the   inspecting   authority

prepared a defect sheet which is worth

perusal in this context. In para 5 of the

said   sheet   the   said   officer   had   clearly

made a note that the society sold away

site   for   parking   place   to   the   Second

defendant i.e., M. Venkata Ramana. The

said Venkata Ramana is a member of the

13

Society   and   had   taken   a   plot   in   the

satellite   city   of   the   NGO's   Cooperative

House Building Society Ltd., Kadapa on

dip system on 26.10.1996. The Society is

also   having   surplus   plots   near

Kondayapalli   village.   The   present

managing   committee   of   the   D1   Society

has cancelled his plot in the satellite city

and executed the impugned reg. sale deed

in favour of M. Venkata Ramana for 3.2.

cents   which   is   the   parking   place   in

question. 

d)  What is important to note in this context

is that the first defendant Society has not

taken   any   prior   permission   from   the

Divisional   Cooperative   officer,

Cuddapah/District   Cooperative   Officer,

Cuddapah   during   the   year   1998/1999

and 1999/2000 to effect sale in favour of

the   2nd   defendant.   The   society   has

regularized   the   several   encroachments

made   by   some   members,   taking

permission   duly   from   the   Cooperative

Dept. But the two cases relating to the

plaintiffs 4 and 5 were not brought to the

notice   of   the   Divisional   Cooperative

Officer, Cuddapah /District. Cooperative

Officer,   Cuddapah,   appropriate   action

was also recommended in the defect sheet

to   be   taken   against   the   managing

committee. 

e)   One   more   important   factor   to   be

appreciated in this context is that the

southern   boundary   is  mentioned  only

as a vacant site but not as the vacant

site   of   the   1st   defendant   Society.   If

really the 1st default Society retained

its ownership on the vacant site on the

southern side it would not have failed

to  mention   that   the   said   vacant   side

14

belonged   to   itself.   It   is   significant   to

note that the boundaries on the other

three   sides   show   to   whom   the

properties belonged.

f)   It is therefore but reasonable to opine

that   plot   No.   27,   35   &   36   were

purchased   only   under   the   impression

that   the   vacant   site   in   question   was

meant   for   parking   of   vehicles.

According   to   the   principles   of   town

planning  there  must  be  parking  place

in any commercial area. In this context

the   judgment   of   the   learned   IV   ADJ,

Cuddapah in O.S. No. 477 of 1996 and

the   Judgment   of   the   learned   1st

ADJ/Cuddapah   in   O.S.   No.   44/98

deserve to be considered with great care.

(28) In the residential area, a site of two cents

being part of a larger area earmarked for public.

park   and   playground   was   sold   by   the   1st

defendant building society to one of the members

of the said society consequently Jayanagar Welfare

association   filed   0.S   No.  477  of   1996  in  public

interest and succeeded in getting a decree. The

contention in the suit was that the extent of 2

cents being part of the area earmarked for play

ground the sale was illegal.  In  the  instant case,

the   extent   of   3.2   cents   is   a   vacant   site   left

obviously for the purpose of parking of vehicles

on the southern side of plots 27, 36, 35 in the

commercial  complex  and  so  the  analogy  holds

good.

(29) Plaintiffs 2 and 3 are no doubt ex­presidents

of the 1st Defendant building society but they are

now members of the welfare association, which is

the 1st defendant in the arbitration reference. The

1st   plaintiff   Kotla   Rama   Subbaiah   was   the   1st

president of the Society.  The  very  fact  that  the

15

plaintiffs   l   to   3   who   are   ex­presidents   of   D­1

building  Society  have   filed  this  dispute  shows

that 3.2 cents must be a parking place because

they  are  well  acquainted  with  all  the  relevant

facts   from   the   beginning.   There   is   no   selfish

interest   for   them   in   questioning   the   sale   in

favour of  the second defendant otherwise.”

       (Emphasis supplied)

13. Notwithstanding the above analogy based on an

assumption which is unsustainable, in order to render a

quietus to the issue, this Court through the order dated

29.10.2021, had sought for a report from the District

Judge, Kadapa on the whole conspectus of the matter.

An   exhaustive   Report   dated   06.11.2021   has   been

submitted on all aspects of the matter which we have

carefully   perused.   The   said   Report   nowhere   indicates

that the plot in question was reserved or earmarked as a

parking area. On the other hand, it has been referred to

as   the   area   earmarked   for   commercial   purpose.   It   is

stated that as per the given layout plan it is in one of the

commercial   areas   out   of   three   slots   allotted   for

16

commercial purpose. Hence, the said report coupled with

the   discussion   by   the   Divisional   Co­operative   Officer

extracted supra, will disclose that it was not earmarked

as   a   parking   area   in   the   layout   plan   but   was   only

deduced so by the Divisional Co­operative Officer in the

course of his discussion in the award.

14. Insofar as the allotment of the plot made to the

defendant   No.2   (Mr.   M.V.   Ramana)   is   concerned,   the

learned District Judge has noted that the defendant No.2

was a member of the Society and Rule 42 relating to the

allotment   procedure   has   been   noted   in   detail.   The

procedure followed in that regard by seeking permission

from the Divisional Co­operative Officer vide letter dated

07.05.1999 and the permission accorded to proceed in

terms of Rule 42 (4) of the Society Rules is referred.

Pursuant to the same, the Board of Directors held a

meeting on 06.04.2000, wherein allotment was made by

passing a resolution to that effect. The decision to allot

was made after cancelling the allotment of plot No.3354

17

which had been made earlier in favour of the defendant.

Since   Rule   42   (4)   required   that   Board   Resolution   be

approved by General Body and the resolutions for the

years   1995­2000   were   not   traced,   it   has   been

commented in the Report that the Board resolution is

without authorisation.

15. In our view, non­availability of the General Body

resolution at this juncture, as observed by the Learned

District Judge, cannot be held to be fatal in the facts and

circumstances of this case. That is for the reason that

the competent authority in appropriate proceedings has

not referred to this aspect. The undisputed position is

also that the defendant No.2 (respondent herein­ M.V.

Ramana) is a member of the Society and being entitled to

allotment of a plot, had earlier been allotted plot No­3354

at another location. It is on surrender of that plot that

the present allotment was made in his favour, though the

plot is of a slightly bigger dimension. The order of the

Divisional Co­operative Officer indicates that the price for

18

allotment was fixed keeping in view the market value.

The allotment being of the year 2000, construction has

also been raised. More than two decades have elapsed by

now. Any intervention or action at this juncture will not

be justified for all the afore­stated reasons.

16. Therefore, taking a holistic view of the matter, the

appeals are dismissed with no order as to costs. 

….…………………….CJI.

(N.V. RAMANA)

..……………………….J.

                                       (A.S. BOPANNA)

          …….……………………J.

  (HIMA KOHLI)

New Delhi,

January 11, 2022 

19

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले