Margaret Almeida vs Bombay Catholic Co-Operative Housing Society

Merely on account of the said pending claim for bifurcation raised by
69 tenant-members, they have exclusively occupied 5.5 acres of land
situated in Santacruz, Mumbai. On the redevelopment of the said land, 230
tenements will be created. The gains to the tenant-members, are clearly
incomparable to the loss which has ensued on account of continued status
quo. 161 beneficiaries, as per the resolution of the Catholic Society
dated 25.9.1966 who had made deposits in 1966 (at the asking of the
Catholic Society) are still waiting. Thus viewed, even on the aspect of
bifurcation/ division of the Catholic Society, there can hardly be any
justification in the prayer made by the tenant-members, for an injunction
against the resolution of the Catholic Society dated 6.12.2009 (and the
consequential conveyance deed dated 7.12.2009). The balance of
convenience, is surely not in favour of the tenant-members.

34. While we are also satisfied, that the Division Bench of the High
Court in the impugned order dated 9.8.2012 has correctly evaluated the
rights of the petitioners/appellants in their capacity as tenant-members.
In so far as the instant aspect of the matter is concerned, it would be
pertinent to mention, that on the issue whether the tenant-members had a
separate identity and right (as against the other members of the Catholic
Society) came to be considered by a learned Single Judge of the High Court
in Misc. Petition no.252 of 1972. The plaintiffs in the present suits
(Suit no.144 of 2010, and Suit no.145 of 2010) are admittedly the same as
the petitioners in Misc. Petition no.252 of 1972. The High Court having
considered the aforesaid issue, namely, whether the petitioners/appellants
had any proprietary right as tenant-members of the Catholic Society, it
held as under:
“This is an entire frivolous petition by the members of a co-operative
society for writs and order under Art.226 of the Constitution quashing
the orders passed by the respondents. The effect of the impugned
orders was that the suit filed by the present petitioners for
declarations that the Resolutions passed at the annual general meeting
of the first respondent society were illegal, void and inoperative in
law and that the present petitioners to quiet and peaceful enjoyment
of their respective tenements, stood dismissed by the appropriate
authorities under the Maharashtra Cooperative Societies Act, 1960. In
challenging the said orders by the present petition, the petitioners
have raised various contentions, but I need refer to only three of
them and they are as follows:

(1) that the general body of the first respondent society has
no power to deprive the petitioners of their tenements;

In support of the first proposition Mr.B.R. Nayak has relied on the decision of the Full Bench of this Court in the case of Manohar vs. Konkan Co.op Housing Society (63 Bom. L.R. 1001 at 1006), but I am afraid the said decision instead of helping Mr.Nayak on the point, is against him in so far as it lays down in unmistakable terms that it is the society alone which is the absolute owner of the property and the members of the society have merely the rights and obligations conferred by the various provisions of the statute itself. It is, therefore, quite clear that it is the society that, as the absolute owner of the property, would have all the rights which any other owner of the property has, and that the petitioners have no proprietary interest at all in their tenements. Under the circumstances, the petitioners do not have even a prima facie case on the point that the first respondent society has no right to depirve them of their tenements.”

The applicants in Misc. Petition no.252 of 1972, assailed the order dated
17.4.1972 (extracted above), by filing Appeal no.74 of 1972. Appeal no. 74
of 1972, was dismissed by a Division Bench of the High Court, on 25.7.1972.
The aforesaid determination attained finality between the rival parties.
In the impugned order dated 9.8.2012, the Division Bench of the High Court
by relying upon the aforesaid determination, further concluded that, the
petitioners/appellants are disentitled in law to claim the relief sought by
them. It is apparent, that the relief sought by the tenant-members, is a
relief which can ordinarily be sought only by individuals/parties who have
a proprietary interest, in the subject matter. While we concur with the
Division Bench, to the effect that the tenant-members have no proprietary
interest in the subject matter of the controversy, it is necessary for us
to refrain from further determining, whether or not the
petitioners/appellants in their capacity as tenant-members having no
proprietary interest can still claim an exclusive right to redevelop a part
of 5.5 acres of land constituting Willingdon East, (even if it is assumed,
that they do not have a right to redevelop, the entire land of Willingdon
East), by seeking a bifurcation of the Catholic Society. Be that as it
may, the Catholic Society has undoubtedly, on the basis of the instant
consideration, made out a prima facie case in its favour (the final
determination whereof will only be rendered, at the culmination of the
proceedings, initiated through the civil suits referred to above). In view
of the deliberations recorded hereinabove, yet again it would be
inappropriate to grant an injunction, restraining all redevelopmental
activities, in terms of the prayer made by the petitioners/appellants.

35. In the background of the conclusions drawn by us hereinabove, it is
no longer necessary to examine the matter under any other parameter(s). Be
that as it may, we wish to consider the claim raised by the tenant-members,
i.e., the petitioners/appellants before us, on the basis of their
contention that whilst the conveyance deed dated 7.12.2009 contemplates a
consideration of Rs.70 crores payable to the Catholic Society, the tenant-
members had been able to procure a better offer, wherein, for the same
developmental project the consideration offered was of Rs.75 crores.

36. The instant issue has been examined minutely by the High Court in the
impugned order dated 9.8.2012. While doing so, the High Court has drawn
the following conclusions. Firstly, that only M/s. Robin Home Developers
Pvt. Ltd. (M/s. Sumer Associates) had come forward with a proposal of
redevelopment of Willingdon East. Due to the pending litigation, no
recognized builder was prepared to make an unconditional offer on “as is
where is” basis. Most of the builders wanted the Catholic Society to
settle the pending litigation. Since the litigation had been pending for
the last more than four decades, the Catholic Society was not in a position
to abide by the pre-condition canvassed at the behest of the recognized
builders. Secondly, the Catholic Society at the time of the general body
meeting held on 6.12.2009, had only one proposal, namely, the proposal of
M/s. Sumer Associates. Thirdly, M/s. Sumer Associates had assured the
Catholic Society of a sum of Rs.70 crores. In fact, the aforesaid amount
of Rs.70 crores was kept in escrow by M/s. Sumer Associates. Fourthly,
during the general body meeting of the Catholic Society, some of the tenant-
members orally made an offer of Rs.75 crores without depositing a single
paisa as against the concrete proposal of M/s. Sumer Associates. Fifthly,
based on the documents placed on the record, it was clear, that the offer
of Rs.75 crores made by the tenant-members, was in fact made by a rival
builder, namely, Mr. B.Y. Chavan (who was duly impleaded before the High
Court). It is therefore, that the Division Bench of the High Court in the
impugned order dated 9.8.2012, made the following observations:-
“33. It was urged by the learned counsel for the appellants that Mr.
Chavan is instigating the plaintiffs to carry on the litigation.
Bills submitted by the Attorneys have been placed on record, to
show that Mr. Chavan has been actively instrumental in giving
instructions to the solicitors/counsels for the plaintiffs. The
correspondence is placed on record to demonstrate that the offer
of Rs.75 crore has been made at the behest of Mr. Chavan. Mr.
Chavan is a party to the proceeding and his right, if any, is
based on the MOU executed in his favour by only 8 tenant-
members. Mr. Chavan was present at the conferences held by the
plaintiff’ solicitors as evidenced from the bills sent by the
solicitors for the conferences held on 29 September 2009, 4
December 2009, 5 December 2009 and 12 December 2009 regarding
writ petitions/suits filed by the plaintiffs against the
Society. Having seen the conduct of the said developer-Mr.
Chavan, the Society had no confidence in him and his associates
and has expressed confidence in the M/s. Sumer Associates. It
is for the Society to decide who should be given the development
rights and not for a small minority of 15 persons like the
plaintiffs. The plaintiffs urged at length before us that the
course adopted by the Sumer Associates is inequitable and bad in
law. However, when the counsel for Mr. Chavan at the end of the
hearing made an offer for higher figure and act exactly in the
same manner as M/s. Sumer Associates, no objection was raised by
the plaintiffs. No contention was then raised that development
through Mr. Chavan in the same manner as M/s. Sumer Associates
will affect the claim of plaintiffs of bifurcation of the
Society. Thus upon offer of Mr. Chavan, all arguments of the
plaintiffs based on law and equity vanished. This conduct of
the plaintiffs is relevant when the Court considers passing
equitable orders. Such conduct of the plaintiffs themselves is
against the spirit of co-operative movement and there can be no
other higher breach of principles of co-operative movement when
a small minority of members stall the decision of overwhelming
majority of members and deprive the members of their legitimate
claim. The Court proceedings cannot be used as an instrument of
harassment and extortion. Prima facie, we find substance in the
contention of the Society that Mr. Chavan is using the
plaintiffs as a tool to block the redevelopment of the Society.”

The aforesaid conclusion drawn by the High Court is sought to be reiterated
by the applicants in Interlocutory Application nos. 17-19 of 2012. As
already noticed hereinabove, the instant interlocutory applications have
been filed by three of the petitioners/appellants, namely, Jennifer Pegado,
Elwyn D Cruz and Don Donato D’Silva. In paragraph 2 of their aforesaid
applications, it was sought to be averred as under:-
“2. That the above petition was filed by these petitioners at the
instance of B.Y. Chavan and Sagar Builders & Developers i.e.
respondent nos. 17 and 18 in the above petition and who have
been instigating the tenants in the property to pursue a
Bifurcation Application and stall the re-development of the
Willingdon (East) property which has been sold by the respondent
no. 1-Society to the respondent no. 20. The said respondent
nos. 17 and 18 have been spending the entire litigation expenses
for the last number of years as also in respect of the present
petition with a view to obstruct re-development of the
Willingdon (East) property in view of they being unsuccessful in
acquiring the same by causing a bifurcation of the Society.
These petitioners have now realized that the above petition
being prosecuted is only in the interest of B.Y. Chavan and
Sagar Builders & Developers, the respondent nos. 17 and 18 in
the above matter and therefore having settled their differences
with the respondent no. 1 and respondent no. 2 have addressed
letters to Advocates Shally Bhasin Maheshwari, who has been
engaged by the respondent nos. 17 and 18 on behalf of the
petitioners calling upon the said Advocates to forthwith
withdraw the above Special Leave Petition. However,
notwithstanding the said instructions the said Advocates have
failed to withdraw the petition and now instead of withdrawing
the petition seek to continue with this Special Leave Petition
by merely dropping these petitioners as petitioners. The
petitioner no. 6 Martin James Michael has also settled his
differences with respondent nos. 1 and 20 and his siblings and
has also instructed Advocate Shally Bhasin Maheshwari to
withdraw the petition, however, since then he has sometime in
the past few weeks passed away and therefore he may be dropped
as petitioner.”

Based on the factual position noticed by three of the
petitioners/appellants in I.A. nos. 17-19 of 2012, the finding recorded by
the High Court in respect of the offer of Rs.75 crores can be stated to
have been made at the behest of a rival builder Mr. B.Y. Chavan. Mr. B.Y.
Chavan has even paid for the litigation expenses of the tenant-members.
The tenant-members readily accepted the offer made by Mr. B.Y. Chavan, when
he proposed before the High Court that he would act in the same manner as
M/s. Sumer Associates. It is therefore natural to infer, that the tenant-
members are agreeable to the redevelopment of 5.5 acres land comprising of
Willingdon East in the manner contemplated by the resolution of the
Catholic Society dated 6.12.2009 (and the consequential conveyance deed
dated 7.12.2009), which is impugned in the suits filed by the tenant-
members. This also prima facie shows that the action of the tenant-members
prima facie seems to lack bona fides. We therefore affirm the
determination rendered by the High Court in the impugned order, that it was
for the Catholic Society to decide who should be given the redevelopmental
rights, and not the tenant-members who are a small minority of 15 persons
(the number having now diminished to 5) who have initiated the litigation
out of which the present proceedings have arisen. As of now, therefore, it
is possible to prima facie infer, that the petitioners’/appellants’ claim
before the High Court does not seem to be bona fide. They also do not
prima facie seem to have genuinely initiated the instant litigation. In
the above view of the matter, the opinion recorded by the High Court, that
all arguments of the plaintiff based on law and equity vanished, upon the
offer made by Mr. B.Y. Chavan, cannot be stated to be unjustified.

For all the reasons recorded hereinabove, we find no merit in the
instant Civil Appeals. The same are accordingly hereby dismissed.

Leave a comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.