2019 INSC 0084      NON­REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO(s) 1313  OF 2019    (Arising out of SLP(Civil) No(s). 8138 of 2013) DELHI DAYALBAGH COOPERATIVE HOUSE BUILDING SOCIETY LTD. …….Appellant(s) VERSUS REGISTRAR COOPERATIVE SOCIETIES AND ORS.     ……..Respondent(s) WITH CIVIL APPEAL NO(s) 1314   OF 2019    (Arising out of SLP(Civil) No(s). 9015 of 2010) CIVIL APPEAL NO(s) 1315   OF 2019    (Arising out of SLP(Civil) No(s). 26905 of 2010) J U D G M E N T Rastogi, J. Civil Appeals arising out of SLP(Civil) No(s). 8138 of 2013, SLP(Civil) No(s). 9015 of 2010,  SLP(Civil) No(s). 26905 of 2010 1. Leave granted. 2. The   above   noted   appeals   are   directed   against   the   orders separately   passed   by   the   High   Court   of   Delhi   in   writ   petitions filed at the instance of the present appellant Society which came 1 to  be dismissed upholding  the  order  of  the  Cooperative  Tribunal setting   aside   the   award   passed   by   the   Registrar   Cooperative Societies   holding   that   the   Arbitrator   had   no   jurisdiction   to examine the validity and legality of the registered sale deed which can   be   questioned   only   by   availing   a   remedy   in   the   Civil   Court holding   jurisdiction.     Orders   were   separately   passed   by   the Tribunal in the cases of the individual members in whose favour sale   deed   was   executed   by   the   society,   having   been   separately decided   by   the   High   Court,   which   has   been   challenged   in   these batch of appeals. 3. The facts that emerge from the multitude and collateral and exhaustive   pleadings   in   brief   are   that   the   appellant   is   a   house building   Society   originally   registered   with   the   Registrar, Cooperative   Societies,   Delhi   (“hereinafter   being   referred   to   as “RCS”) under the provisions of the Bombay Cooperative Societies Act, 1925.   On enactment of the Delhi Cooperative Societies Act, 1972,   the   provisions   of   the   Act,   1972   and   the   rules   framed thereunder   came   to   govern   the   field.     However,   the   Act   of   1972 came   to   be   repealed   by   the   Delhi   Cooperative   Societies   Act, 2003(hereinafter being referred to as the “Act 2003”) as amended 2 by   the   Delhi   Cooperative   Societies(Amendment   Act),   2006   which now   governs   the   field   along   with   Delhi   Cooperative   Societies Rules, 2007 framed thereunder. 4. The   Society   framed   its   bye­laws,   namely,   Delhi   Dayalbagh Cooperative   House   Building   Society   Ltd.,   Soami   Nagar,   New Delhi, with the primary object to acquire the land either through outright   purchase   or   on   lease   for   construction   of   houses   for   its members,   either   on   rent   or   on   hire   purchase   system   or   by outright   sale   with   a   stipulation   that   no   member   shall   be permitted   to   transfer,   sell   or   mortgage   his   house   to   any   person other   than   the   members   of   the   society   or   the   society   itself   as referred to under  bye­law 51 and after the object being achieved for   which   the   Society   has   been   formed,   the   procedure   may   be followed for its liquidation as referred to under bye­law 65.   Para 5, 51 and  65 of bye­laws  which are relevant for  the purpose  are reproduced   as   under:­ ” 5. (i) Any person shall be eligible to be a  member of the society provided:­­ (a) he   is   a   follower   of   Radha   Soami faith and a member of Radha  Soami Satsang   affiliated   to   Radha   Soami   Sabha, Dayalbagh,  Agra; 3 (b) He,   at   the   time   of   enrolment   as   a member, is domiciled in the  Union Territory   of   Delhi   or   has   been   resident   in the Union  Territory   of   Delhi   for   two years   or   more;   provided   that   this   condition   shall   not   apply   to   members   of All   India   Services   and   employees   of   the Central   Government   and   the   Delhi Administration. (c) his   written   application   for membership   has   been   approved   by   a   majority of the Managing Committee. (d) his   age   is   more   than   18   years, except in the case of minor heir of  a deceased member; (e) he   is   not   a   member   of   any   other house building society; (f) he   or   his   wife   (she   or   her   husband in case of a woman) or any of  his/her dependents does not own a dwelling house or a plot for  building a house in Delhi; (g) directly   or   indirectly   he   does   not deal in purchase or sale of house  or land   for   construction   of   houses   either himself or through any  of   his dependents. (h) he has carried out the provisions of bye­law. (ii) Every   person   seeking   membership   of   the   society shall   sign   a   declaration   to   the   effect   that   he   or   his wife(she or her husband) or any of his/her dependents does not own a dwelling house or plot in Delhi and that he/she   is   not   a   member   of   any   other     co­operative house building society. (iii)Every member on admission shall pay Rs.10/­ as  admission fee which shall not be refunded in any case. (iv)When   a   person’s   application   has   been   accepted   by the Committee and he has paid his admission fee and 4 first   instalment   of   this   shares,   he   shall   be   deemed   to have   acquired   all   the   rights   and   incurred   all   the obligations and liabilities of a member of the society as laid   down   in   the   Co­operative   Societies   Act,   the   Rules made there under and these bye­laws. (v) Application   for   admission   as   member   and   for allotment   of   shares   shall   be   made   to   the   Secretary   in the   form,   if   any,   prescribed   by   the   society   for   the purpose.     Every  such  application  shall be  disposed  off by   the   Managing   Committee   who   shall   have   power   to grant  admission or  to refuse it after  recording  reasons for   such   refusal,   provided,   however,   that   any   person whose   application   has   been   refused   by   the   Managing Committee may prefer an appeal within 30 days to the Assistant   Registrar,   Co­operative   Societies(Housing). The decision of the Assistant Registrar shall be final. 51.   No   member   shall   be   permitted   to   transfer,   sell   or mortgage his house to any person other than the members of the society or the society itself. 65.   The   society   shall   be   wound   up   and   dissolved   only by  order of the Registrar under Section 39, 40 or 42 of the Co­operative Societies Act. After all the liabilities including the paid up share capital have   been   met,   the   surplus   assets   shall   not   be   divided among   the   members,   but   shall   be   devoted   to   any   object   of public   utility   determined   by   the   General   Meeting   of   the society  within three months of the date of final liquidation, and approved by the Registrar,  or they may in consultation with them either be assigned by the Registrar in whole or in part to any or all of the following :­ (a) an object of public utility of local interest ; (b) a   charitable   purpose   as   defined   in   section   (2) of the Charitable Endowment Act ; (c) or   may   be   placed   on   deposit   with   The   Delhi State   Co­operative   Bank   until   such   time   as   a   new society   with   similar   conditions   is   registered   when, with the consent of the Registrar, such surplus may be   credited   to   the   Reserve   Fund   of   such   new society.” 5 5. To fulfil the object with which the society was formed, it was desirous of obtaining land for construction of dwelling units to be made available for   its members.   However, it  did  not  go into  the market   to   purchase   land   but   approached   the   appropriate Government   for   its   assistance   with   an   application   invoking   Part VII of the Land Acquisition Act, 1894, to provide the land located in   various   Khasras   admeasuring   137   bighas   &   11   biswas situated   at   village   Chirag   Delhi   for   construction   of   dwelling houses for its members.   6. Part   VII   of   Land   Acquisition   Act,   1894   under   the   heading “Acquisition  of  Land   for  Companies”  begins  with   Section   38  and runs upto Section 44 B.   Section 38 was repealed by Section 68 of 1984 with effect from 24 th   September, 1984.   The issue in the present   case   is   pertaining   to   year   1955   when   the   acquisition proceedings were initiated.  Section 38A was a part of the Statute at   the   relevant   point   of   time   when   the   acquisition   proceedings were initiated by the appropriate Government in the year 1955. 7. Section 39 lays down that Sections 6 to 16 and Sections 18 to 37 (both inclusive) shall not be put in force in order to acquire 6 land   on   behalf   of   the   company   without   previous   consent   of   the Government   unless   the   company(includes   society)   executes   an agreement.     In   terms   of   Section   40,   a   consent   is   to   be   obtained after the appropriate Government record its satisfaction either on the   report   of   the   Collector   under   Section   5A   or   by   the   inquiry held  as  provided  for   the  purpose  of  acquisition  is  to  obtain  land for   erection   of   dwelling   houses   for   workmen   employed   by   the company   or   that   such   acquisition   is   needed   for   construction   of building   or   work   for   the   Company   and   that   work   is   likely   to   be proved useful to the public.   8. The State Government thus proceeded under Part VII of the Land   Acquisition   Act   and   after   holding   preliminary   enquiry   as envisaged   under   Section   40   of   the   Land   Acquisition   Act,   1894 and after recording its satisfaction, executed an agreement laying down   the   terms   &   conditions   with   the   appellant   Society   under Section   41   dated   12 th   April,   1955   which   was   published   under notification dated 13 th   May, 1955 in the Official Gazette in terms of Section 42 of the Act, became the force of law and binding not only upon the parties to the agreement but also on the public at large.     The terms & conditions indicated in the agreement dated 7 13 th   May,   1955   published   in   the   Gazette   and   relevant   for   the present purpose are reproduced hereunder:­ “1. That   the   Society   shall   pay   to   the   State Government   or   such   person   or   persons   as   the   State Government   may   appoint   in   this   behalf   before possession   of   the   said   land   is   given   to   the   Society   the compensation,   if   any,   as   settled   by   the   Collector   or   if reference   is   made   to   the   court   by   the   final   court   or appeal and  all  compensation inclusive  of  all payments and   allowances   in   respect   thereof   payable   under   the said   Act   and   all   Courts   costs   and   pleaders   fees   etc. incurred   by   the   State   Government   in   defending   the reference, if any, made to the court as aforesaid and on appeal or appeals filed in connection therewith and all compensation, pleaders fee etc. payable or paid by the State Government  to the claimant in the said matters. The   State   Government   shall   not   be   bound   to   give possession   of   the   land   until   all   the   said   money   have been paid, and may withdraw from the acquisition, and in   case   of   withdrawal   the   Society   shall   be   liable   to indemnify   the   State   Government   against   all   expenses incurred   and   damage   sustained   as   the   result   of anything done by them in the matter of acquisition till the date of withdrawal. 2. That   upon   such   payment   by   the   Society   the   Chief Commissioner   covenants   to   convey   and   grant   to   the Society the said land described in the Schedule hereto, to held the same to the said Society for every subject to the conditions hereafter not forth, namely:­ (a) That   the   Society   shall   within   15   years   of being   put   in   possession   of   the   said   land utilise   this   land   for   the   purpose   it   is acquired. (b) That   the   Society   its   successors   and assignees   shall   use   the   said   land   for aforesaid   purposes   and   for   no   other purposes, whatsoever. (c) That   if   the   Society   fails   to   carry   out   any of   the   terms   of   this   agreement   or   if   the   said land   no   longer   required   by   the   said   Society for   the   aforesaid   purpose,   then   the   Society 8 shall   forthwith   relinquish   and   restore   the same   in   favour   of   the   Chief   Commissioner and   land   shall   be   liable   to   be   resumed   and taken   by   the   State   Government   on   payment to   the   Society   of   the   amount   of   award   as finally   settled   or   the   estimated   market   value of   the   land   at   the   time   of   resumption, whichever,   shall   be   less   and   if   there   are   any buildings   on   the   land   the   Chief Commissioner   may   at   his   option   either purchase   the   buildings   on   payment   of   their estimated   value   at   the   time   or   direct   the Society   to   remove   the   buildings   at   its   own cost   which   such   time   as   may   be   allowed   by the State Government. (d) That   should   any   dispute   or   difference arise   touching   or   concerning   the   subject matter   of   this   agreement   or   any   covenant   or clause   of   thing   contained   therein,   the   same shall be referred to the Sole Arbitration of any person nominated by the Chief Commissioner of Delhi or in case his designation is changed or   his   office   is   abolished   to   the   sole arbitration   of   any   person   nominated   by   the officer,   who   for   the   time   being   is   entrusted, whether or not in addition to other functions with the functions of the Chief Commissioner of Delhi by whatever designation such officer may   be   called.   It   will   be   no   objection   to   any such   appointment   that   the   arbitrator   so appointed   is   a   Government   servant   that   he had   to   deal   with   the   matters   to   which   this indenture   relate   and   in   the   course   of   his duties   as   such   Government   servant   he   has expressed   views   on   all   or   any   of   the   matters in   dispute   or   difference.   The   award   of   the arbitrator   so   appointed   shall   be   final   and binding on the parties.” 9. After acceptance of the terms & conditions of the agreement being   deduced   in   writing,   duly   published   in   the   Official   Gazette under   Section   42   of   the   Act,   having   the   force   of   law,   the   State 9 Government   proceeded   to   complete   the   acquisition   proceedings and  published the  award under  Section  11 of the  Act dated 26 th February   1957   and   after   taking   possession   free   from encumbrances   under   Section   16   of   the   Land   Acquisition   Act, handed over possession to the society  in terms of the agreement dated   13 th   May,   1955   on   11 th   June,   1957   and   30 th   July,   1957 respectively.     It   may   be   relevant   to   note   that   any   agreement   or Memorandum   of   Understanding,   if   any,   executed   while possession   of   the   subject   land   was   handed   over   to   the   society, has   not   been   placed   by   the   society   on   record   and   inference   can be   drawn   that   while   handing   over   possession,   the   State Government   intended   to   comply   with   the   terms   &   conditions   of the agreement dated 13 th   May, 1955 to be adhered to in its true spirit   by   the   society   and   indisputedly   breach,   if   any,   of   the conditions of the agreement has not been brought to the notice of the Court.   10. The   appellant  Society   in   fulfilment  of   its  obligations   and   in terms of the agreement dated 13 th   May, 1955 allotted plots to its members   within   the   stipulated   period   of   15   years   by   a   separate registered   sale   deed   executed   on   certain   terms   and   conditions. 10 Since the terms and conditions of allotment as recited in the sale deed are common, we have noticed from the registered sale deed dated   30 th   December   1968   in   reference   to   plot   no.   B­68   to   its member Mr. Manocha, on acceptance of full consideration for the plot in question. 11. Coming to the facts of the Civil Appeal arising out of SLP(C ) No. 8138 of 2013, Mr. K.L. Manocha, as a lead case, who was a member of the Society allotted a plot no. B­68, Soami Nagar and sale deed was executed in his favour  on 30 th   December, 1968 in the   same   terms.     It   reveals   that   Mr.   Manocha,   had   initially constructed a single storey house later intended to demolish and construct   a   multi   storey   structure   for   his   own   needs   and requirements.  The appellant came across with the advertisement in   the   magazine   titled   “Real   Property   Times”   in   June,   2005   for sale   of   a   basement,   four   bedroom   apartments   on   each   of   the upper   four   floors   of   the   building   constructed   on   the   plot   in question.  This fact came to the notice of the society on 18 th  June, 2005.     The   society   published   a   notice   inviting   the   public   in general that the  residential plots in  Soami Nagar  cannot be sold to persons who are not the members and who are not eligible to be   members   of   the   society   and   violation   of   the   society   bye­laws 11 and the sale deed even if registered shall be at his own risk and peril.  12. At   this   stage,   a   claim   petition   was   filed   at   the   instance   of society   under  Section  70  of  the  Act,  2003  seeking  declaration   of the   sale/transfer   of   the   property   in   question   by   the   allottee   to   a non­member   without   prior   notice   or   permission,   as   illegal   and void   being   in   violation   of   clauses   2   &   3   of   the   sale   deed   and clause   51   of   the   bye­laws   and   it   was   prayed   that   the   same   may be cancelled and the property be referred back to the society. 13. The award was passed in favour of the appellant society and against   the   respondent   no.   2   dated   1 st   December   2006   holding that sale/transfer was violative of clauses 2 & 3 of the sale deed and   bye­law   51   directing   the   impleaded   respondent(member   of the society) to hand over the property within the stipulated time to   the   appellant   society.     But   no   order   was   passed   against   the transferees/purchasers   including   the   respondents   being   non­ members of the society.   When the proceedings were initiated in execution of the award and property was stated to be attached at one   stage   on   28 th   November,   2007,   the   respondents   who   were stated   to   be   the   parties   and   claiming   to   be   the   purchasers   and 12 occupants   filed   separate   appeals   against   the   award   before   the Cooperative   Tribunal.     At   the   same   time,   the   appellant   society also   filed   appeal   assailing   the   award   to   the   limited   extent   with regard   to   deletion   of   names   of   the   impleaded   respondent   nos.   3 and   4   with   a   prayer   for   reinstatement.   The   appeals   filed   by   the impleaded   respondents   and   of   the   appellant   society   were   heard by the Tribunal and disposed of by a common judgment dated 6 th January, 2012.   The appeal of the appellant society was allowed but the award passed by the Arbitrator dated 1 st  December, 2006 was   set   aside   which   was   the   subject   matter   of   challenge   before the Delhi High Court and after being affirmed on dismissal of the writ   petition   preferred   by   the   appellant   society,   the   matter   is under challenge in the present batch of appeals. 14. Civil   appeal   arising   out   of   SLP(Civil)   No.   9015   of   2010   has been filed against the order  dated 28 th   October, 2009.   Although the   question was the same with the additional factor raised that in   terms   of   condition   nos.   2   &   3   of   the   sale   deed,   notice   was served   on   the   society   that   was   not   responded   failing   which   the member   proceeded   to   sell   the   subject   plot   but   service   of   notice was disputed by the appellant society and the Tribunal held that 13 the   appeal   of   the   society   for   cancellation   of   the   legally   executed registered   sale   deed   is   not   a   subject   matter   which   is   covered under   the   provisions   of   the   Delhi   Cooperative   Societies   Act   and rules framed thereunder and such registered instrument, if at all one   is   aggrieved,   could   be   challenged   in   a   civil   Court   having jurisdiction  and   in  the  writ  petition   preferred  by  the   society,  the High   Court   while   upholding   the   view   of   the   Tribunal   further observed that in the absence of the purchaser being impleaded as party  to the proceedings, his rights indeed has been jeopardised who   indisputedly   was   a   necessary   party   to   the   proceedings   and when   the   valid   transaction   is   sought   to   be   set   aside   by   the Arbitrator   under   its   impugned   award,   the   purchaser   was   to   be heard and was held against the appellant and on the twin ground the   writ   petition   came   to   be   dismissed   is   the   subject   matter   of challenge. 15. In civil appeal arising out of SLP(C ) No. 26905 of 2010, the order   of   the   Tribunal   which   was   on   the   same   lines   and   placing reliance on the earlier order of the High Court dated 28 th  October 2009, the Writ Petition(C ) no. 2136/2008 came to be dismissed with   additional   fact   taken   into   consideration   that   Section   91   of 14 the   Act,   2003   gives   recognition   to   purchase   through   the registered   agreement   to   sell   or   power   of   Attorney   or   a   sale   deed and   on   fulfilment   of   conditions,   the   applicant,   if   apply   for membership  by   paying   transfer  fee, share money  and  admission fee etc. as per  the provision  of  the bye­laws, the society  and the committee   has   to   grant   membership   to   the   applicant   within   30 days   of   the   submission   of   application   and   refusal   by   the Committee   may   give   rise   to   appeal   by   the   applicant   to   the Registrar of the Cooperative Societies. 16. Mr.   Shekhar   Naphade,   learned   senior   counsel   for   the appellant   submits   that   it   is   not   in   dispute   that   the   land   was acquired   by   the   appropriate   Government   under   Part   VII   of   the Land Acquisition Act and for the aforesaid purpose, the appellant society and the Government entered into an agreement dated 13 th May,   1955   under   Section   41   of   the   Land   Acquisition   Act   which came   to   be   published   in   the   official   Gazette   in   compliance   of Section   42   of   the   Act   and   has   a   force   of   law   and   learned   senior counsel submits that in terms of the agreement, the Government has   to   execute   a   deed   of   conveyance   and   grant   the   said   land   to the   society.   Indisputedly,   the   Government   has   failed   to   execute 15 deed of conveyance or make the grant in favour of the society and further   to   support   its   title,   the   society   filed   a   Writ   Petition   No. 6406 of 2001 and order came to be passed on 7 th   January, 2004 directing   the   Government   by   Writ   of   Mandamus   to   execute   the deed   of   conveyance.   Taking   assistance   thereof,   learned   senior counsel   submits   that   in   the   absence   of   any   agreement/deed   of conveyance   been   executed   by   the   Government,   the   appellant society  itself does not hold  a  freehold title and is not  a owner  of the subject land in question and so long as the society is not the owner of the subject land, it could not transfer ownership rights to its members as the transferor cannot confer on the transferee a   better   right   than   what   he   himself   possess   and   the   purported sale deeds executed by the society in favour of its members even though   indicated   in   the   recital   of   the   sale   deed   as   owner   of   the subject   plot   but   that   may   not   transfer   any   ownership/freehold title on its members. 17. According   to   the   learned   senior   counsel,   the   title   of   the parcel   of   land   is   still   with   the   Government   and   the   Government has  not  executed any  deed of  conveyance  so  far  despite order  of the Delhi High Court dated 7 th  January, 2004 and the agreement 16 dated 13 th   May, 1955 is nothing more than a promise to execute a   deed   of   conveyance   and   the   agreement   may   have   a   binding force in view of its publication in the Gazette under Section 42 of the   Land   Acquisition   Act   but   cannot   be   construed   as   extending freehold title to the society.   18. Learned senior counsel further submits that Section 44 A of the Land Acquisition Act clearly provides that no company (which include   society)   for   whom   land   is   acquired   under   Part   VII  of   the Act   is   entitled   to   transfer   the   land   or   any   part   thereof   by   sale, mortgage,   gift   or   otherwise   except   with   the   previous   sanction   of the   Government.     According   to   learned   senior   counsel,   the   sale deeds   executed   after   1962,   when   Section   44   A   came   on   the statute   book   w.e.f.   12 th   September,   1962   does   not   indicate   that any   previous   sanction   has   been   obtained   from   the   Government and mere permission to use does not create any right or interest on the subject land in favour of the society.  At least, in any case, no ownership of freehold right is created so far and Section 54 of the Transfer of Property Act, 1882 is merely a codification of the principle  of   common   law   which  may   not  be   of   any   assistance   to the respondents as its defence. 17 19. Learned   senior   counsel   appears   to   be   very   futuristic   in   his approach   when   submits   that   even   if   the   Government   decides   at later   stage   to   grant   ownership   to   the   society,   such   ownership would   always   be   subject   to   Section   44A   of   the   Land   Acquisition Act   and   society   cannot   make   any   transfer   in   any   form,   without previous   consent   of   the   Government   and   the   very   concept   of freehold means that the holder of the land has an absolute right to   transfer   and/or   create   any   rights   in   the   land   without   being required to take any permission or consent of any other authority or   person   and   in   this   context,   the   finding   which   has   been recorded   converting   freehold   rights   in   favour   of   the   members   in respect of the plots allotted to them is erroneous and contrary to law which according to him is not sustainable.   20. According   to   learned  senior   counsel  Mr.  Shekhar   Naphade, the   purported   sale   deed   executed   by   the   society   in   favour   of   its members   has   no   legal   effect   and   even   the   terms   on   which   the members   of   the   society   are   occupying   their   respective   plots   or their houses confers no right in favour of the allottees.  Thus, the transfer   made   by   individual   members   to   third   parties/non­ 18 members   without   previous   sanction   of   the   Government   are   void ab initio  bad and such transfer without prior permission/consent of   the   society   even   by   registered   sale   deed   apart   from   being   in violation of the provisions of the bye­laws are also hit by Section 44A   of   the   Land   Acquisition   Act   and   no   legitimate   right   can   be conferred   on   the   allottee   or   its   transferee   to   whom   rights   have been   transferred   on   the   subject   plot   in   question   and   placed reliance   on   the   judgment   of   this   Court   reported   in     Zoroastrian Cooperative   Housing   Society   Ltd.   and   another     Vs.   District Registrar,   Cooperative   Societies(Urban)   and   Others   2005(5) SCC 632. 21. Per contra, Mr. Ranjit Kumar, learned senior counsel for the respondents   while   supporting   the   judgment   of   the   High   Court submitted   that   the   question   which   has   been   raised   by   the counsel   for   the   appellant   is   beyond   the   pleadings   and   it   was never   the   case   of   the   society   either   before   the   Arbitrator   or   the Tribunal   or   the   High   Court   or   even   in   the   pleadings   in   the   civil appeal   that   in   the   absence   of   any   deed   of   conveyance   being executed   in   terms   of   clause   2   of   the   agreement   dated   13 th   May, 19 1955,     the   society   does   not   hold   freehold   title/rights   over   the subject   land   in   question   and     what   is   being   argued   before   this Court   is   beyond   the   pleadings   and   has   been   raised   for   the   first time   while   making   oral   submissions   and   there   is   no   factual foundation   on   record   in   support   of   what   is   being   prayed   and further submitted that the subject plots have been allotted to the members   of   the   society   as   its   owner   free   from   encumbrances transferred by the Government, after being acquired at the behest of the society under the provisions of the Land Acquisition Act.  22. Learned senior counsel for the respondents further submits that   after   the   agreement   dated   12 th   April,   1955   been   executed under   Section   41   of   the   Land   Acquisition   Act,   1894   and published in the Gazette dated 13 th   May, 1955 become a force of law   by   virtue   of   Section   42   of   the   Act   and   the   agreement   dated 13 th   May,   1955   recites   certain   terms   &   conditions   and   on   its satisfaction,   the   appropriate   Government   had   proceeded   to complete the acquisition proceedings and handed over possession of   the   subject   land   in   question   to   the   society   free   from encumbrances   on   11 th   June,   1957   &   30 th   July,   1957     and   after the   possession   was   taken   over   by   the   society,   the   society 20 proceeded   in   making   allotment   to   its   members   by   a   registered sale deed conferring rights and title in favour of the allottee.   23. Learned   senior   counsel   for   the   respondents   submits   that   a conjoint   reading   of   clauses   2   &   3   of   the   sale   deed   (dated   30 th December, 1968 in the instant case), the society reserves its pre­ emptive rights over the subject plot in question and if the society fails   to   purchase   within   the   stipulated   period   at   the   prevailing market   price,   the   member   will   be   at   liberty   to   dispose   of   in   the manner as he/she likes. 24. According to learned senior counsel, Section 91 of the Delhi Cooperative Societies Act, 2003 envisage that any member of the housing   society   who   has   sold   his   plot   or   flat   on   the   registered Power of Attorney or agreement for sale or by sale deed ceases to be   a   member   of   the   society   and   the   transferee   who   has purchased   the   subject   property   on   the   registered   Power   of Attorney or agreement for sale or by sale deed on fulfilment of the conditions as stipulated on depositing the transfer fee and share money, if any, the Society and the Committee is under obligation to   grant   membership   to   the   applicant   within   30   days   from   the submission of application and  in case of refusal, there is remedy 21 to   the   applicant   to   approach   the   Registrar   of   the   Cooperative Societies for redressal of his/her grievance.   25. Learned senior counsel submits that there is no refusal ever made   by   the   society   to   the   transferees   who   had   purchased   the subject   plot   in   question   contemplated   under   Section   91   of   Act, 2003   failing   which   the   transferees,   in   their   own   capacity,   be considered   and   deemed   to   be   a   member   of   the   society   in   the absence of any order being passed by the society to the contrary. 26. Learned senior counsel for the respondents further submits that throughout even, from  the correspondence evident from the letter   dated   27 th   July,   1985   from   the   Secretary   of   the   Society   to Lt.   Governor   stated   in   para   2   that   the   “Delhi   Administration acquired   approx.   30   acres   of   land   allotted   to   the   society   on   25 th March,   1957   on   freehold   basis”.     Later,   in   the   letter   dated   15 th March, 1989 addressed to the authority from the Secretary of the Society,   it   was   stated   that   “the   status   of   the   land   is   totally freehold and allotment of plots to the society’s members was also on   the   same   basis.”     That   apart,   the   society,   at   one   stage, approached   the   District   Judge   in   RCA   95/82   titled   as   Delhi 22 Dayalbagh Cooperative House Building Society Ltd.   Vs.   Arjun Das and after the matter was being heard, the learned trial Judge also recorded   its   finding   that   the   subject   land   in   dispute   is   being   a freehold and there is no legal bar to the same being sold and the order   passed   by   the   learned   trial   Judge   never   came   to   be challenged by the society and accepted the nature of the land of which   the   possession   was   handed   over   by   the   appropriate Government on completion of acquisition proceedings initiated at the instance of the society vested free from encumbrances.   27. Learned   senior   counsel   further   submits   that   Section   70   of the   Act   have   a   limited   jurisdiction   to   examine   the   dispute touching   the   constitution,   management   or   the   business   of   the cooperative society to arbitration and the prayers made are in the nature of declaration that the registered sale deed in favour of the non­members be held to be null and void is indisputedly beyond its   scope   and  jurisdiction   and   has   been   rightly  interfered   by  the Tribunal   and   confirmed   by   the   High   Court   on   dismissal   of   the writ   petition   preferred   at   the   instance   of   the   society   and   placed reliance   on   the   judgment   of   this   Court   in   Usha   Ranjan 23 Bhattacharjee and Others   Vs.   Abinash Chandra Chakaborty and Ors.  reported in 1997(10) SCC 344.    28. Learned senior counsel submits that after the enactment of the   Delhi   Cooperative   Societies   Act,   1972   or   2003,   the   bye­laws of the societies have to be in conformity with the provisions of the Act.   There   is   a   restrictive   clause   if   inconsistent   with   the provisions of the Act, 2003 may not have any enforceability under the   law   and       further   submits   that   the   possession   free   from encumbrances   was   handed   over   by   the   appropriate   Government to the society after passing of the award in June/July 1957 and it may not be open for the appellant to take a summersault and raise   a   question   which   was   never   agitated.     In   last   60   years, much   water   has   flown   in   the   Ganges,   conferring   rights   over   the subject   property   and   at   this   belated   stage   when   number   of   sale deeds have been executed at various point of time by the society with   its   members   which   has   been   further   transferred   to   non­ members  by  registered power  of  attorney  or   agreement  to  sell or sale deed and their rights are protected under Section 91 of Act, 2003 and at such belated stage when there is no residential plot available   with   the   society   at   its   disposal,   question   of   deed   of 24 conveyance   not   executed   may   not   arise   for   consideration   and   it appears that this  plea has been raised to  nullify  the  winding  up proceedings which is adversely affecting the rights of the society. 29. We   have   heard   learned   senior   counsel   for   the   parties   at length and with their assistance perused the records. 30. Before adverting further, we will discuss some material facts and the relevant provisions of the Delhi Cooperative Societies Act and the bye­laws of the society which may have a direct bearing on the issue under consideration. 31. After   the   action   been   initiated   by   the   society   for   providing land   in   fulfilment   of   the   public   purpose   in   providing   plots   to   its members,   the   appropriate   Government   issued   a   notification under   Section   4   dated   19 th   March,   1955   and   after   holding   a preliminary   inquiry,   as   contemplated   under   Chapter   40   of   Part VII   of   the   Act,   1894,   and   on   its   satisfaction,   the   appropriate Government   executed   an   agreement   dated   12 th   April,   1955   with the   society   under   Section   41   in   fulfilment   of   the   necessary requirements, namely, payment to the Government of the cost of 25 acquisition,   the   transfer   of   land   to   the   society   on   such   payment prescribing the terms on which the land shall be provided to the society   and   where   the   acquisition   is   for   the   purpose   of   erecting dwelling   houses,   all   the   provisions   of   Act   connected   therewith, time   and   the   manner   in   which   the   dwelling   houses   have   to   be erected,   on   the   terms   &   conditions   came   to   be   published   in   the Gazette   under   Section   42   of   the   Act   on   13 th   May,   1955   which became   the   law   and   binding   on   the   parties   and   the   public   at large.     The   appropriate   Government   thereafter   proceeded   in making   declaration   under   Section   6   of   the   Act.     Consequent thereto,   award   came   to   be   passed   under   Section   11   on   11 th February, 1957 and the appropriate Government took possession of   the   subject   land   in   question,   free   from   all   encumbrances, under Section 16 of the Land Acquisition Act and it has come on record   that   possession   was   transferred   to   the   society   for   whom the  acquisition  proceedings were  initiated  at its  instance  on  11 th June,   1957   and   30 th   July,   1957   respectively   free   from encumbrances and, therefore, the title in transferring the land to the   society   in   terms   of   the   agreement   dated   13 th   May,   1955 created a statutory genesis.   It is not the case of either party that there   was   any   breach   or   violation   of   the   terms   and   conditions 26 which has been referred to under the agreement dated 13 th   May, 1955   either   by   the   society   or   its   members   or   the   purchasers   or the successors in interest. 32. The   emphasis   of   learned   senior   counsel   for   the   appellant that   the   title   of   the   land   in   question   never   stood   transferred   to the   society   in   the   absence   of   the   deed   of   conveyance   been executed, is without substance for the reason that the title at the first place in favour of the society  was not created by  any of the modes   ascribable   to   the   Transfer   of   Property   Act   and   once   the acquisition   proceedings   have   been   initiated   by   the   Government, on   fulfilment   of   the   conditions   referred   to   under   Section   41   of Land Acquisition Act on being published in the Gazette dated 13 th May   1955   under   Section   42   of   the   Act   which   became   the   law, there   appears   no   further   statutory   requirement   to   register   any deed of  conveyance under  the  Transfer  of  Property  Act.    Besides it,   the   consideration   amount   was   paid   by   the   society   as demanded   by   the   competent   authority   and   physical   and   actual possession,   free   from   encumbrances,   was   delivered   to   the appellant   society   and   the   land   stood   conveyed   and   granted   in terms of clause 2 of the agreement.  At the same time, no party in 27 the instant proceedings ever raised any objection/dispute on the issue   of   physical   possession   of   the   land   in   question   being delivered  to  the  appellant   society  and/or  the   same  being  passed on   to   the   person   who   have   purchased   plots/flats   therein subsequently.     In   the   given   facts   and   circumstances,   it   can legitimately   be   observed  that   the  marketable   title   in  transferring respective plots to its members has created a statutory genesis.   33. It   is   also   not   the   case   of   the   appellant   society   that   at   any later   stage,   after   the   appropriate   Government   handed   over possession,   free   from   encumbrances,   of   the   subject   land   in question to the society, it ever raised objection in reference to the breach   of   the   terms   &   conditions   of   the   agreement   dated   13 th May, 1955 to resume the subject land or for taking legal recourse in   reference   to   the   title   of   the   subject   land   in   question.     In   the given facts and circumstances, a legal presumption can be drawn that   after   the   peaceful   possession   free   from   encumbrances,   was handed over by the State Government to the society, all rights of the   said   land   stood   vested   with   the   society   free   from encumbrances   and   transferred   to   its   members   on   the   terms   as indicated in the registered sale deed executed by the society. 28 34. The   sale   deed   dated   30 th   December,   1968   was   executed   in favour   of   one   of   the   applicant   Shri   Manocha,   member   of   the society to whom plot no. B­68 was allotted by registered sale deed on certain terms & conditions on depositing the cost of the land, the physical possession of the subject land/plot was passed on to the   member   of   the   society.     The   extract   clause   of   the   sale   deed dated 30 th   December, 1968 which are standardised conditions in all   the   sale   deeds   relevant   for   the   purpose   is   reproduced   as under:­ “ This   Sale   Deed   is   made   on   this   30 th   day   of December   1968   by   the   Delhi   Dayalbagh   Co­operative House   Building   Society   Ltd.   Delhi,     in   favour   of Shri/Smt.   K.L.   Manocha,   son   of   Shri   M.R.   Manocha, resident of Delhi, a member of the Society, WHEREAS   the   Chief   Commissioner,   Delhi   vide notification   No.   F­15   (147/34­LSG   dated   17.3.55   and notification   No.   F­15(147)/54­LSG   dated   13.6.56   and Awards   in   pursuance   thereof   acquired   land   for   the colony   of   the   Society   now   known   as   “SOAMI   NAGAR COLONY”  and   whereas   the   society   is   the   owner   of   the plot   No.   B­68   measuring   488   Sq.   yds.   forming   part   of the SOAMI NAGAR COLONY and whereas the member Shri K.L. Manocha has paid to the Society all the dues in respect of the share money, the cost of the land, and development charges. AND  WHEREAS  the  said plot  No.  B­68 situated  in  the said   colony   of   the   Society   has   been   hereunder   sold   to Shri K.L. Manocha for a sum of Rs.1952/­(Rupees One Thousand Nine Hundred Fifty Two only) being the cost of land, which amount has been paid by the member to the society. 29 AND   WHEREAS   the   purchaser   member   has   agreed that he/she shall pay to the vendor Society or to whom it   directs,   the   amount   which   may   be   found   by   the Vendor   Society   to   be   due   from   him/her   in   future   in respect   of   the   aforesaid   plot   and   in   case   of   failure   to pay such dues which shall always be deemed as a debt due   to   the   Vendor   Society,   which   dues   shall   be   first charge   on   the   said   plot   and   the   building   constructed thereon. AND   WHEREAS   the   member   Shri   K.L.   Manocha   has agreed   to   always   abide   by   the   Rules   and   Bye­laws   of the Society in force time to time.  AND   WHEREAS   the   purchaser   member   agreed   that he/she shall construct a house on the said plot sold to him/her   within   two   years   after   the   sale   deed   by   the vendor society is registered.  NOW THIS DEED OF SALE WITNESSETH AS UNDER:­ 1. That subject to conditions stated in this sale deed and in consideration  of Rs. 1952/­  (Rupees One Thousand Nine   Hundred   Fifty   Two   only)   as   the   cost   of   the   land paid   by   the   member   to   the   said   society,   it   hereby transfers,   and   conveys   to   the   member   Shri   K.L. Manocha   his/her   heirs   and   assignees   all  rights   in   the plot   of   land   no.   B­68   as   delineated   on   the   plan annexed   to   this   Sale   Deed,   to   hold   the   same   to   the member on the plan annexed to this Sale Deed, to held the same to the member for ever. 2. The purchaser member will continue to be the member of   the   vendor   society,   if   the   purchasing   member proposes   to   sell   or   transfer   his   house   or   plot,   he/she undertakes   to   sell   or   transfer   it   to   or   through   the society.     If   the   society   does   not   purchase   the   house within   six   months   at   the   prevailing   market   price,   the member   will   be   at   liberty   to   dispose   it   off   as   he/she likes. 3. The   successor   will   have   also   to   be   a   member   of   the vendor   Society.    If   he/she  does  not   become   a  member of the society, he/she shall sell the house of plot to or through   the   Society   at   the   prevailing   market   price,   if the   Society   does   not   purchase   the   house   within   six months,   the   successor   will   be   at   liberty   to   own   it   as any other member or dispose it off as he/she likes. 30 4. That   the   purchaser   member   agrees   to   construct   and build   house   on   the   plot   in   accordance   with   the   rules and bye­laws of the Municipal Corporation and will not do   anything   to   violate   the   said   rules   and   bye­laws   of the Corporation or of the Government which may bring about   or   shift   any   liability   on   his/her   account   to   the Society  and  if he/she  does anything  which  on  his/her account the vendor society is made liable, he/she shall compensate the vendor Society and if/she does not pay the   vendor   Society   the   said   dues,   the   Vendor   Society liability on him/her will/be the first charge on the plot and/or the house constructed by him/her.  5. Expenses   in   connection   with   the   registration   and stamp will be borne by the vendor/society.” 35. Prior   to   the   enactment   of   the   Act   2003,   the   Delhi Cooperative   Societies   Act,   1972   was   in   force,   but   by   passage   of time, it revealed that the Act of 1972 fails to fulfil the object and rule of cooperative societies which had undergone a sea change. In order to gear up the cooperative societies to meet the challenge posed due to economic liberalisation and superfast growth in the field of Information Technology and to protect the interests of the members   of   the   cooperative   societies   as   financial   stakes   had become high, the Government of the National Capital Territory of Delhi   earlier   appointed   a   Committee   in   1995   to   prepare   a   new cooperative   law   and   after   a   detailed   discussion,   Committee submitted   a   report   on   31 st   August,   1998   which   was   further 31 reviewed   by   the   Review   Committee   and   after   the   report   being submitted,   the   Delhi   Cooperative   Societies   Act,   2003   came   into force   on   its   publication   in   the   Gazette   of   3 rd   March,   2004. Certain   amendments   were   made   vide   the   Cooperative   Societies Amendment   Act,   2004   and   2006   respectively   and   in   exercise   of power  under   Section  137,  the Delhi  Cooperative Societies  Rules, 2007   were   framed   to   achieve   the   object   of   the   provisions   of   the Delhi Cooperative Societies Act, 2003. 36. Apart   from   the   provisions   in   reference   to   the   settlement   of disputes as referred to under Chapter VIII, a separate Chapter IX was   introduced   incorporating   the   special   provisions   for Cooperative   Housing   societies.     The   Chapter   applies   to   all cooperative housing societies including housing financial society. Section 74(a) defines allottee a member of the cooperative society to   whom   plot   or   land   or   site   or   flat   could   be   allotted   by   the cooperative   society   and   the   principal   object   of   the   cooperative housing   society   is   defined   in   Section   74(e)   and   (f)   of   Section   74 deals   with   dwelling   unit   which   includes   a   house,   flat   or apartment for the purpose of dwelling and sub­section (k) defines the occupancy rights of an allottee to possess and use the plot or 32 the land.  The limitation of membership has been provided under Section 75 and the rights and privileges of members on allotment of plot or dwelling unit in a cooperative housing society has been defined   under   Section   76.     It   further   takes   note   of   not   only allotment   but   has   a   provision   for   nomination   and   restriction   on transfer of share or interest of a member.  Permission to transfer the   occupancy   right   is   not   to   be   ordinarily   refused   is   explained under Section 80 with a special provision providing for settlement of   disputes   and   Section   91   introduces   a   special   provision   for regularisation of occupancy rights of persons who have acquired rights through the instrument on registered Power of Attorney or agreement for sale or registered sale deed to become a member of the society on depositing the requisite transfer fee, admission fee, etc.     Section   74(e),   (f),   (k),   Section   80   and   Section   91   which   are relevant for the purpose are reproduced as under:­ 74 (e) " co-operative housing society " means a co- operative society- (i) registered or deemed to be registered as a co- operative housing society under this Act; (ii) the principal object of which is to provide its members open plots under plot housing, dwelling units or flats (whether in a multi-storeyed building or otherwise) in a complex under group housing and in case where open plots or dwelling units or flats are already acquired to provide its members 33 common amenities and services including services relating to the arrangement of finances for facilitating construction of dwelling units in order to solve their needs of dwelling units through mutual-aid in accordance with the co-operative principles, and includes a house building, co- partnership, co-ownership housing society, co- operative housing maintenance society, multipurpose co-operative housing society and any other co-operative society of like nature and purpose; (iii) "co-operative housing maintenance society" means a co-operative society formed by the owners of dwelling units in a building for the purpose of maintenance of the building and provisions of common amenities, services, etc; (iv) "co-ownership co-operative housing society" means a co-operative society known as "house building" or plotted society in which the land is held either on lease-hold or free-hold basis by the co-operative society and the houses constructed on it are owned or to be owned by its members; (v) "co-partnership co-operative housing society" known as group housing means a co-operative society in which land and buildings are held by the co-operative society on lease-hold or free hold basis and members are allotted flats or such other premises in such buildings with a right to occupy the same in accordance with terms of lease, Government's guidelines and the bye-laws of such group housing; (vi) "multi-purpose co-operative housing society" means a society formed with the object of undertaking multifarious activities for the economic and social development of its members, particularly of slum dwellers and economically weaker sections of the people, in addition to providing better housing accommodation and better environment to improve their quality of life; (f) " dwelling unit " includes a house, flat and apartment for the purpose of dwelling; 34 (k) " occupancy right " means the right of an allottee to possess and use the plot of land, site or dwelling unit or flat allotted to him with power to give it on hire or on lease and licence or to mortgage it or to donate or to gift or to transmit it by will or by inheritance or to transfer it after paying the transfer fee; 80. Permission for transfer of occupancy right not to be ordinarily refused and provision for appeal- (1) No co-operative housing society shall ordinarily refuse to grant to its member permission for transfer of his occupancy right in the property of the co-operative housing society unless the transferee is otherwise not qualified to be a member: Provided that nothing contained in any agreement, contract or the bye-laws regarding eligibility for membership stipulated therein shall apply to a nominee, heir or legal representative of the deceased member for his admission to membership of the co-operative housing society: Provided further that aforesaid transfer in case of lease hold land shall be governed by the provisions of the perpetual lease of land. (2) The decision of the co-operative housing society on an application for permission to such transfer shall be communicated to the applicant within thirty days from the date of receipt of the application. (3) Any person aggrieved by the decision of the co- operative housing society refusing permission for such transfer may within thirty days from the date on which the refusal of permission is communicated to him appeal to the Registrar. (4) The Registrar shall dispose of the appeal within a period of one hundred and twenty five days whose decision shall be final. 91 .A member of a housing society who has sold his plot or flat on the power of attorney or agreement for sale or by sale deed, shall cease to be a member of that society from the date of the sale of plot or flat: Provided that the purchaser having registered power of attorney or registered agreement for sale or registered sale deed, as the case may be, in 35 respect of such plot or flat, may apply for membership by paying transfer fee of five hundred rupees and share money and admission fee as per the provisions of the bye-laws of the society and the committee shall grant membership to the applicant within thirty days after the submission of his application. In case of refusal by the committee, the applicant may appeal to the Registrar within thirty days and the decision of the Registrar shall be final: Provided further that no purchaser shall be entitled for more than one membership in a housing society. 37. It may be further noticed that Section 131, save the existing cooperative   societies,   registered   either   under   the   Act   of   1904   or under the Act of 1912 or under the Bombay Cooperative Societies Act   1925   which   was   in   force   in   Delhi   or   the   Delhi   Cooperative Societies   Act,   1972,   shall   be   deemed   to   be   registered   under   the corresponding   provisions   of   this   Act(Act   of   2003)   and   rules framed thereunder with the further legislative mandate that bye­ laws   thereof   shall,   so   far   as   the   same   are   not   inconsistent   with the   express   provisions   of   this   Act,   continue   to   be   in   force   until altered   or   rescinded.     Section   140   overrides   other   law, notwithstanding anything inconsistent with the provisions of this Act.  Section 141 being repeal and savings stipulates that the day on   which   the   Delhi   Cooperative   Societies   Act,   2003   comes   into force,   the   Delhi   Cooperative   Societies   Act,   1972   which   was   in 36 force   in   the   National   Capital   Territory   of   Delhi   shall   stand repealed preserving the actions under the Repeal Act.   38. The   Scheme   of   Act   2003,   on   its   very   inception,   was introduced   with   the   object   to   meet   the   challenge   posed   due   to economic   liberalisation   and   superfast   growth   and   to   protect   the interests of the members of the societies as financial stakes had become   high   which   made   the   Government   and   the   National Capital  Territory  of  Delhi  conscious  by  replacing  the  Act to  sub­ serve the purpose in protecting  the interest  of  the members and of   the   society   which   have   been   created   for   the   welfare   of   its members.     The   principal   object   of   the   cooperative   housing societies   as   referred   to   under   Section   74(e),   shall   not   be ordinarily refused for transfer of occupancy rights, as referred to under   Section   80   and   Section   91   mandates   that   if   a   member   of the   housing   society   has   sold   his   plot   or   flat   on   the   Power   of Attorney   or   agreement   for   sale   or   sale   deed,   shall   cease   to   be   a member of the society from the date of the sale of the plot of land and   the   purchaser   will   enter   into   his   shoes   having   registered power of Attorney or registered sale deed, as the case may be, in respect   of  the   plot   or   a  flat   on   depositing  the   transfer   fee,   share money   and   admission   fee   as   per   the   provisions   of   the   bye­laws. 37 The   society   and   the   committee   are   under   obligation   to   grant membership to the applicant within a period of 30 days and if the society have assigned reasons to refuse, the remedy lies with the applicant to file appeal to the Registrar.   What is borne out from the   scheme   of   Act,   2003   that   the   purchaser   having   registered Power of Attorney or agreement for sale or sale deed on fulfilment of certain basic requirements on deposit the member fee, transfer fee, share money and admission fee, etc. as per the provisions of the   bye­laws   of   the   society   is   entitled   ordinarily   to   become   the member  of  the  society.    Section   91  read  with  Section  131 of  the Act   provides   that   any   bye­laws   if   inconsistent   or   any   other enactment which is not in conformity with the provisions of Act of 2003, is ultimately the substantive law that has to prevail upon. Section 131 & 141 of the Act, 2003 are reproduced below:­ 131.   Saving   of   existing   co­operative   societies ­   (1) Every   existing   co­operative   society   which   had   been registered   under   the   Co­operative   Credit   Societies   Act, 1904 or under the Co­operative Societies Act, 1912, or under the Bombay Co­operative Societies Act, 1925, as was   in   force   in   Delhi,   or   the   Delhi   Co­operative Societies   Act,   1972   shall   be   deemed   to   be   registered under   the   corresponding   provisions   of   this   Act   and rules framed thereunder and bye­laws thereof shall, so far   as   the   same   are   not   inconsistent   with   the   express provisions of this Act, continue in force until altered or rescinded. (2)   All   appointments,   rules   and   orders   made, notifications   and   notices   issued   and   suits   and   other 38 proceedings instituted under the said Acts shall, so far as   they   are   consistent   with   the   provisions   of   this   Act, be deemed to have been respectively made, issued and instituted   under   this   Act,   save   that   an   order   made cancelling registration of a co­operative society shall be deemed,   unless   the   co­operative   society   has   already been   finally   liquidated,   as   an   order   issued   under section   95   or   section   96   or   section   97   for   its   being wound up. 141.   Repeal   and   savings   –   On   the   day   on   which   the Delhi   Co­operative   Societies   Act,   2003   comes   into force, the Delhi Co­operative Societies Act, 1972 (35 of 1972) in force in the National Capital Territory of Delhi shall stand repealed: Provided that the repeal shall not affect­ (a) The previous operation of the Act so repealed or anything duly done or suffered thereunder; or (b) Any   right,   privilege,   obligation   or   liability acquired,   accrued   or   incurred   under   the   Act so repealed; or (c) Any   penalty,   forfeiture   or   punishment incurred  in  respect   of  any   offence  committed against the Act so repealed; or (d) Any   investigation,   legal   proceedings   or remedy in respect of any such right, privilege, obligation,   liability,   penalty,   forfeiture   or punishment   as   aforesaid   and   any   such investigation,   legal   proceedings   or   remedy may be instituted, continued or enforced and any   such   penalty,   forfeiture   or   punishment may   be   imposed   as   if   that   Act   had   not   been repealed.” 39.  For saving the existing cooperative societies registered either under the Act of 1904, 1912 or under the Act of 1925 which was in   force   in   Delhi   at   one   stage   or   the   Act   of   1972,   such   existing cooperative   societies   were   deemed   to   be   registered   under   the 39 corresponding   provisions   of   the   Act   2003   and   the   rules   framed thereunder   and   its   bye­laws   thereof,   so   far   as   the   same   are   not inconsistent   with   the   express   provisions   of   the   Act,   2003, continue to be in force until altered or rescinded.  It goes without saying that bye­laws of the existing  cooperative societies have to be   in   conformity   with   the   express   provisions   of   the   Act   of   2003 and   all   previous   actions   stood   saved   by   virtue   of   Section   141   of the Act. 40. The   contention   of   the   learned   senior   counsel   for   the appellant   that   the   sale/transfer   of   the   plot   in   question   by   the member of the society being in violation of condition nos. 2 and 3 of the registered sale deed or clause 51 of the bye­laws which put restriction on the member  to transfer or a sale or  otherwise to a non­member   of   the   society,   without   permission   of   the   society   in our   opinion,   deserves   to   be   negated   for   the   reason   that   there   is no   restriction/prohibition   under   the   provisions   of   the   Act,   2003 which has been discussed in detail earlier and to be noticed that if the bye­laws to the extent are inconsistent to the provisions of Act 2003, it is the statute which will prevail and it is not the case of the appellant that the transaction of sale/transfer of the plot in 40 question by the member of the society by registered sale deed or registered   instrument   is   in   violation   of   the   provisions   of   the mandate of Act 2003 or rules 2007 framed thereafter.   41. To   the   contrary,   it   appears   to   be   the   duty   of   the   Registrar cooperative societies including the registered housing cooperative society to scrutinise the bye­laws of the society and to the extent they   are   inconsistent   with   the   provisions   of   Act   2003   or   of   Rule 2007   framed   therein,   to   ask   them   to   make   appropriate corrections and to amend it to make it in conformity with the Act, 2003.     It   is   needless   to   say   that   it   is   the   onerous   duty   of   the competent authority to ensure that it performs the statutory task in   this   behalf   but   if   the   task   has   not   been   performed   as   yet,   at least   no   provision   in   the   bye­laws   inconsistent   with   the provisions of the Act, 2003 can have a force of law.  42. As regards clauses 2 & 3 of the original sale deed executed between the member of the society at the time of initial allotment is concerned, the society reserves its pre­emptive rights to have a cooling   period   of   six   months   before   the   member   may   have   an opportunity to transfer the subject plot in the manner he or she likes at least there was no absolute bar or restrain under clause 41 2   or   3   of   the   original   sale   deed,   of   which   reference   has   been made, to transfer the land or is otherwise impermissible to a non­ member   under   any   other   laws.     But   it   was   possible   with   prior notice to the  society  and the  cooling  period of  six  months which may enable the society to purchase the plot on the market value and if it is unable to purchase, the member reserves the right to transfer or sell out the plot in a manner he or she likes reserving the pre­emptive rights of the society.  In the given circumstances, transfer by a registered instrument cannot be held void unless it is   in   contravention   of   any   law,   which   is   not   the   case   of   the appellant society.  43. It   reveals   that   what   transpired   before   the   Tribunal   or   the High   Court   was   whether   the   transfer   of   title   by   a   registered instrument   as   alleged   was   open   for   scrutiny   within   the   scope   of Section   70   of   Act,   2003.     Although   it   was   never   the   case   of   the appellant   society   that   alleged   registered   sale   deed   was   void   ab initio,   bad   or   obtained   by   fraud   or   malpractices   and   it   was   also not   the   case   of   the   appellant   society   that   the   member   of   the society in transferring the rights over the property by a registered 42 sale   deed,   is   in   violation   of   any   of   the   provisions   of   the   Act   of 2003, or the rules of 2007 framed thereunder.   44. It is gainful to add that the possession was handed over to the society on fulfilment of the conditions of the agreement dated 13 th  May, 1955, published in the Gazette under Section 42 of the Land   Acquisition   Act,   and   became   the   law   as   observed,   that   at the time when the possession was handed over to the society by the   State   Government,   no   further   deed   or   MOU   was   executed restricting  the rights of the society for  fulfilment of its obligation of   its   plots   to   its   members,   that   persuades   to   infer   that   the possession was handed over to the society of the subject land in question   by   the   Government   free   from   encumbrances   with unrestrictive rights to execute the sale deed/allot the plots to its members   obviously   as   per   its   bye­laws   keeping   in   view   of   the mandate of the statutory provisions of the Act, 1973 or Act, 2003 which has later on taken over the field in protecting the interests of   the   members   of   the   cooperative   societies   including   the cooperative housing society as in the instant case. 45.   It   may   be   relevant   to   note   that   the   subject   land   was throughout   exhibited   by   the   society   as   freehold   land   having ownership rights and allotments were made by  the society  to  its 43 members   by   the   registered   sale   deed   at   the   time   of   allotment   of plots.     It is to be noticed that a letter dated 27 th   July, 1985 was written by the Secretary of the society to the Lt. Governor and it was   mentioned   in   paragraph   2   of   the   letter   that   “Delhi Administration   acquired   30   acres   of   land   allotted   to   the   society on 25 th   March, 1957 on freehold basis.” Later, in the letter dated 15 th   March,   1989   issued   to   the   Secretary   of   the   Society   it   was certified   that   the   status   of   the   land   is   totally   freehold   and allotment   of   the   plots   to   the   society   members   was   also   on   the basis   of   it   and   the   society   at   one   stage   approached   to   the   civil Court   in   RCA   No.   95/82   titled   Delhi   Dayalbagh   Cooperative House Building Society Ltd.  Vs.  Arjun Das  and it was observed by the   learned   trial   Judge   that   “the   land   in   dispute   is   freehold   one and   there   is   no   legal   bar   to   the   same   being   sold.”     In   the   given facts   and   circumstances,   if   the   allotment  has   been  made   by   the society   as   a   freehold   land   to   its   members   who   have   further transferred/sold the subject land/plot by  registered sale deed to its successors/purchasers, their rights to become member of the society   are  indeed  saved  under   Section   91   of  the   Act,  2003  that in  no  manner   could be eluded by   the bye­laws and  that  apart if anyone   has   any   objection   regarding   the   registered 44 instrument(sale deed) pursuant to which right has been created, at   least   it   is   not   open   to   examine   its   validity   within   the   domain and ambit of Section 70 of the cooperative societies Act and any person,   if   felt   aggrieved,   the   remedy   lies   only   before   the   civil Court   having   jurisdiction   questioning   the   registered   instrument within the parameters available under the law. 46. The appellant  society  at one  stage in their  counter  affidavit has stated that the subject land is a grant under the Government Grants   Act.     It   was   nowhere   the   case   ever   set   up   and   it   was raised   just   to   denude   the   rights   of   the   parties   which   deserves outright rejection for  the additional reason that the subject land was   acquired   by   the   Government   under   Part   VII   of   the   Land Acquisition   Act   and   transferred   to   the   society   free   from encumbrances,   there   is   no   applicability   to   the   Government Grants   Act.   The   judgment   on   which   reliance  was   placed  by   the learned   senior   counsel   for   the   appellant   in   Mohsin   Ali   and Others  Vs.  State of Madhya Pradesh  1975(2) SCC 122 may not be of any assistance. 45 47. As   regards   submission   made   in   respect   to   Section   44A   of the   Act  is  concerned,  it  may  not  have  any  application,  since  the rights of the parties are governed after the land stood vested with the   society   free   from   encumbrances   and   regulated   under   the special   enactment   of   the   Act   2003   and   Rules   2007   framed thereunder. 48. In   conclusion,   we   find   no   substance   in   either   of   the submissions   made   by   the   appellant   to   interfere   with   the judgment   impugned   before   us.     The   appeals,   being   devoid   of merit, are accordingly dismissed. 49. In   terms   of   the   dismissal   of   the   appeals,   application(s)   for impleadment, does not survive and are accordingly disposed of. 50. Pending application(s), if any, shall also stand disposed of. …………………………J. (A.M. KHANWILKAR) ………………………….J. (AJAY RASTOGI) New Delhi January 30, 2019 46 47