MIS. ANITA ENTERPRISES AND ANR. v. BELFER COOP. HOUSING SOCIETY LTD. & ORS.

32Copy pinpoint32. Another decision upon which reliance was placed on behalf of E the appellants is the case of Sanwarmal [supra]. In that case, a petition was filed under Section 91 of the Societies Act for passing an order of eviction of a licensee who was inducted as a licensee by a member of the Society, though contrary to the provisions of Section 29(2) of the Societies Act, but he became deemed tenant under Section ISA of the F Rent Act on 1.2.1973, i.e., the date on which the amending Act came into force, as the licensee was in occupation of the premises and licence was subsisting on that date, as such this Court held that the petition under Section 91 of the Societies Act was not maintainable as the licensee acquired the status of tenant even though there was no privity of contract between the parties, but as the status of tenant was acquired, by legislative intervention, under Section ISA of the Rent Act, as such he was entitled to claim protection under the said Act. Though in that case the question whether right to occupy a flat in a case of tenant co-partnership society is transferable or not was not in issue before the Court, but following the judgment in the case of Ramesh [supra], this Court obsenred that the right of a member in the flat is transfer;:ible. In our view, the aforesaid

M/S. ANITA ENTERPRISES v. BELFER COOP. HOUSING 47 SOCIETY LTD. [B.N.AGRA WAL,J.] observation in the case of Sanwarmal [supra) cannot be said to be ratio of the case but a mere obiter, as such the same can be of no avail to the appellants.

33Copy pinpoint33. It has been submitted that in case transfer has been made by a member in infraction of the provisions of Section 47(2) of the Societies Act., according to the provisions of Section 47(3) the same shall be void, but there is no such provision in case there is infraction of the provisions of Section 29(2) which, we have already found, are mandatory. In case there is infraction of a mandatory provision, in that event the transaction cannot be said to be void but would obviously be voidable and once avoided, the relationship oflandlord and tenant, i.e., between the member and the appellants cannot be said to have been duly created, meaning thereby in accordance with law. Thus, we have no difficulty in holding that the relationship of landlord and tenant between the appellants and the member was not duly created, as such the appellants would not be entitled to claim protection under the Rent Act and the bar created under D Section 28 of the Rent Act would not operate.

34Copy pinpoint34. This takes us to the next question whether legality or otherwise of the creation of relationship oflandlord and tenant between the member and the appellants could be adjudicated in the suits filed by the appellants before the Court of Small Causes for declaration that they were tenants E in the premises in their respective occupation and there was relationship of landlord and tenant between the member and the appellants. The said suits were dismissed by the trial court after recording a finding that no relationship of landlord and tenant existed between the member and the appellants, but on appeal being taken the appellate bench of the Court of F Small Causes decreed the suits holding that relationship oflandlord and tenant did exist between the member and the appellants after reversing decree passed by trial court. When the matter was taken to the High Court in writ applications, the same have been allowed, decrees passed by the appellate bench of the Small Causes Court set aside and those of the trial G court restored whereby it was held that there was no relationship of landlord and tenant between the member and the appellants. When suits were filed before the Small Causes Court by the appellants for a declaration that there was relationship of landlord and tenant between them and the member, it was open to the defendants to take a defence H

.,. } 48 SUPREME COURT REPORTS [2007) 12 S.C.R.

A that no such relationship was created either in fact or in law as creation of such a right was barred under Section 29(2) of the Societies Act. In the present case the factum of creation of tenancy has not been disputed, but what has been disputed is its legality. As the creation of tenancy was in infraction of mandatory provisions of Section 29(2), it was voidable B and invalid in law although not void and the Small Causes Court was not only competent to decide the same but obliged under law to go into the same before granting or refusing relief to the plaintiff as the same was a point in issue in those suits. This being the position, we are of the view that the High Court was justified in setting aside the decrees passed by c the appellate bench of the Small Causes Court and restoring those of the Small Causes Court whereby suits for declaration were dismissed after recording a finding that there was no relationship oflandlord and tenant between the member and the appellants who were consequently not entitled to claim protection under the Rent Act and no interference by this Court is called for.

35Copy pinpoint35. The last question that falls for decision is as to whether the Society was required to first obtain adjudication from a competent civil court by filing a properly constituted suit for a declaration that relationship oflandlord and tenant was not duly created and, therefore, the induction of a person by the member as tenant was invalid, the same being in infraction of mandatory provisions of Section 29(2) of the Societies Act before raising a dispute under Section 91 of the Societies Act or the said question could be gone into in a proceeding under Section 91 of the Societies Act before the Cooperative Court where a dispute touching upon the business of the society can be raised by the parties and in deciding the said dispute was it permissible for the Court to go into the said question. It is tme that ordinarily in case of a transaction like the present one which is voidable and not void, if an aggrieved party intends to avoid the same it is required to obtain a decree from a competent civil court by filing a properly constituted suit. But in a case like the present one, if a party is first asked to obtain a decree from a competent civil court and only thereafter raise a dispute which is undisputedly touching upon the business of the society under Section 91 of the Societies Act, the same would frustrate the provisions of Section 91 and the intention of the Legislature in incorporating a cheap and expeditious remedy by referring the same H

, ) MIS.ANITA ENTERPRISES v. BEL FER COOP. HOUSING 49 ~ SOCIETY LTD. [B.N. AGRA WAL,J.]

to a court constituted under the Societies Act instead of throwing a party A ... • to cumbersome procedure of moving a civil court.

36Copy pinpoint36. The dispute raised in the present case, undoubtedly, touches upon business of the Society which is a condition precedent for the applicability of Section 91 of the Societies Act. The business of tenant B co-partnership housing society is, after purchasing plots and constructing houses/flats thereon, to allot the same to its members for their self occupation and for a period of one year they can not part with possession of the same in favour of anybody and on expiry of the said period can transfer the same in favour of member of the society or to a person whose application for membership has been accepted by the society or to a c person whose appeal under Section 23 of the Societies Act has been allowed by the Registrar or to a person who is deemed to be a member under sub-Section (IA) of Section 23 of the Societies Act. It is part of business of the Society to see that the house/flat allotted to a member remains in his occupation or in occupation of any other member and if D any non-member intends a transfer in his favour, like the present one, he is required to obtain previous consent in writing either of the Society or its Managing Committee and in the event of consent being accorded, the Society shall admit him as a nominal member in which eventuality only the transfer can be made in his favour. In the present case, under Section E 91 of the Societies Act, the Society was well within its right to get a dispute adjudicated as to whether the member had, by inducting the tenants in the flat, who were non-members, made a transfer in contravention of the provisions of Section 29(2) of the Societies Act. Thus the question regarding legality or otherwise of the creation of tenancy right F by the member in favour of the appellants, which amounts to transfer of interest of a member in the property of the Society, can be decided by raising a dispute before the Cooperative Court.

37Copy pinpoint37. In the present case, the only dispute raised before the Cooperative Court was as to whether transfer made by a member in favour of a so- G called transferee/tenant thereby purporting to create a tenancy right in his .I favour was in infraction of the mandatory provisions of Section 29(2) of the Societies Act, as such the same was touching upon business of the Society. In case Cooperative Court decides such a dispute in favour of the Society in that eventuality the so-called transferee/tenant would not H

50 SUPREME COURT REPORTS [2007) 12 S.C.R. ' }

A be entitled to claim any protection under the Rent Act, the bar provided under Section 28 of the Rent Act would not operate and consequently the petition under Section 91 of the Societies Act would be maintainable. • •

38Copy pinpoint38. Learned counsel appearing on behalf of the appellants submitted that even if the tenancy is created in breach of law haYing statutory force, B the same would not be void. Reliance in this connection has been placed upon a decision of this Court in the case of Nanakram v. Kundalrai, [1986) 3 sec 83, in which it was held that tenancy created in breach of Rent Control Order, which was having a statutory force, was not void. In that case under Clause 22 of the Central Provinces and Berar Letting c of houses and Rent Control Order, 1949 a landlord was required to report the matter to the DeputyCommissioner, upon vacation of the premises, who i,i.lone was empowered to permit induction of any tenant, but instead of adopting the said procedure, landlord himself inducted tenant which was challenged by filing a suit before civil court for a declaration that creation of tenancy right was invalid. The trial court decreed the suit and the said decree was confirmed in appeal by the High Court. When the matter was brought to this Court, it was held that the transaction was not void and the infraction alleged was not of mandatory provisions of lmv which would obviously mean that the transaction was not even voidable, as such the suit was liable to be dismissed. In our view, the case of Nanakram [supra] is quite distinguishable and shall have no application to the present case as here there was infraction of mandatory provisions of Section 29(2) of the Societies Act. Thus we hold that the question regarding legality or othef\vise of creation of relationship of landlord and tenant between the member and the appellants could have been gone into by the Cooperative Court under Section 91 of the Societies Act as it touches upon business of the Society and the High Court has not committed any error in not interfering with the ord~r passed by appellate court confinning that rendered by the Cooperative Court.

39Copy pinpoint39. For the foregoing reasons, we do not find any merit in these appeals which are accordingly dismissed, but there shall be no order as to costs. S.K.S. Appeals dismissed. '