D.K. Deshmukh, J.
1. By this petition the Petitioners challenge the order dated 3-2-2003 passed by the Respondent No. 1/State of Maharashtra. By the order dated 3-2-2003 the Government of Maharashtra has held that the action of the Bombay Municipal Corporation of exempting 21 structures owned by the Respondent No. 5- Co.operative Housing Society from payment of cess under the Maharashtra Housing & Area Development Act, 1976 is not proper and that cess is leviable on 21 structures owned by the Respondent No. 5-society.
2. The brief facts relevant for deciding this petition are that there were several structures standing on C.S. No. 375, Mazgaon Division, Mumbai. One Shri Dhankumar Thakurdas Jhaveri was the owner of the said property. The occupants of those structures in the year 1976 formed a Co.operative Housing Society called 'Tarabaug Aikyavardhak Co.operative Housing Society Ltd.-the Respondent No. 5.' The owner of the property executed a deed of conveyance dated 7th July, 1977 in favour of the Respondent No. 5-society. According to the Petitioners, there were 23 structures standing on the land. Out of 23 structures, 2 structures were repaired by the Bombay Building Repairs and Reconstruction Board. It appears that the Deputy Chief Administrative Officer of the Bombay Housing and Area Development Board by letter dated 15th October, 1979 informed the Corporation that in view of the provisions of the MHADA, the Board has no objection to the exemption of 21 structures from payment of repair cess with effect from 1-4-1978. In other words, the Bombay Housing & Area Development Board had an objection to 2 out of 23 structures being exempted from payment of repair cess. It appears that in the meantime the Managing Committee of the society decided to redevelop the property and constructed two buildings where some of the occupants were accommodated. It, thereafter, appears that for carrying out the balance development the Respondent No. 5/Society entered into contract with the Respondent No. 6. According to averments in the petition, the appointment of Respondent No. 6 as developer of the Respondent No. 5 society was not in accordance with law. It appears that the Respondent No. 6, thereafter, took up the work of construction of the building. The application, pursuant to which the order which is impugned in the petition has been made, appears to have been made by the Respondent No. 6 as a power of attorney holder of the Respondent No. 5-society. In other words, the order dated 3-2-2003 has been made by the State Government at the instance of and on an application made by the Respondent No. 5 society. The effect of the order is that the Respondent No. 5-co.operative society becomes liable to pay repair cess to the State Government on all the 23 structures standing on the land. It is also common ground that net result of the order dated 3-2-2003 is that the Respondent No. 5/society becomes entitled to larger FSI for carrying out the balance development on the land. As the order impugned in the petition has been made at the instance of the Respondent No. 5-society, the order is actually invited by that society and direct beneficiary of that order is the Respondent No. 5-society. Therefore, at the outset, we asked the learned Counsel appearing for the Petitioners to satisfy us as to why we should set aside the order, assuming that that order has not been made in accordance with law by the Government, at the instance of the Petitioners, who have filed this petition in their capacity as the members of the Respondent No. 5-society.
3. If one goes through the petition, it appears that according to the Petitioners the appointment of Respondent No. 6 as a developer was made by the Managing Committee of the Respondent No. 5 without passing proper resolution. But admitted position is that the Petitioners to this date have neither challenged the resolution passed by the Respondent No. 5-society appointing the Respondent No. 6 as a builder nor have they filed proceedings challenging the agreement that has been entered into by the Respondent No. 5-society with the Respondent No. 6-builder. In this background, therefore, we asked the Petitioners to satisfy us as to why we should entertain their petition challenging the order which apparently is in favour of the Respondent No. 5-society of which the Petitioners are the members. Even according to the Petitioners, there are more than 140 members of the Respondent No. 5-society and only 4 out of those members have filed this petition.
4. The learned Counsel appearing for the Petitioners relied on a judgment of Full Bench of Andhra Pradesh High Court in the case of M. Vanaja v. B. Balaseshanna : 2007(4)ALD388 to contend that because repair cess now will be required to be paid by the society, the Petitioners who are its members can be said to be aggrieved persons; a judgment of Division Bench of Delhi High Court in the case of Radhey Sham v. Lieutenant Governor ILR 1970 (Del) 260; a judgment of the Supreme Court in the case of Tashi Delek Gaming Solutions Ltd. v. State of Karnataka and Ors. : AIR2006SC661 ; and a judgment of the Supreme Court in the case of Bangalore Medical Trust v. B.S.Muddappa : [1991]3SCR102 .
5. The learned Counsel appearing for the Respondents, on the other hand, relied on the observations of the Supreme Court in a Constitution Bench judgment in the case of Daman Singh and Ors. v. State of Punjab and Ors. : [1985]3SCR580 , the judgment of the Supreme Court in the case of State of U.P. and Anr. v. C.O.D. Chheoki Employees' Cooperative Society Ltd. and Ors. : [1997]1SCR380 , and the judgment of the Supreme Court in the case of Zoroastrian Cooperative Housing Society Ltd. v. District Registrar, Co.operative Societies (Urban) and Ors. : AIR2005SC2306 .
6. Now, the power of the State Government to make the order which is impugned in the petition cannot be doubted. Because the beneficiary of the cess is Government. The cess is imposed by the Act and the Government recovers the cess through the Corporation. Therefore, challenge to the validity of the order can be on the ground that in view of the provisions of the Act, the State Government could not have made the order. In other words, the challenge can be that though the power is vested in the Government to make the order, in this case the order has been wrongly made. Thus, we are not considering the case, where the order is patently without jurisdiction or without authority of law. But we are considering the case where the order may be erroneously made, though the authority has a power to make the order.
7. There are two consequences flowing from the order, which is impugned in the petition, viz. (i) The Respondent No. 5-society which is the owner of the property becomes liable to pay repair cess and (ii) the society and the Respondent No. 6 who is the builder appointed by the society become entitled to larger FSI because now all the 23 structures are cessed structures.
8. Perusal of Section 82 shows that cess is to be levied and paid to the Government and the cess is to be recovered by the corporation in the same manner in which it collects the property-tax. Therefore, the cess will be payable by the owner of the building because the cess is imposed on the building and the land. The primary liability to pay the cess is of the Co.operative Society, which owns the property. It can be said that the Co.operative Society may be entitled to recover the amount of cess that it is required to pay from its members. But in this case a categorical statement has been made on behalf of the Respondent No. 5/society that whatever amount of cess is liable to be paid pursuant to the order impugned in the petition would be paid by the Respondent No. 5-society itself and nothing will be recovered from its members. It is, thus, clear that the order of the State Government which is challenged in the petition does not visit the Petitioners with any adverse consequence. On the contrary, the Respondent No. 5/society gets a huge benefit because of the order made by the State Government. From the record, therefore, it is clear that the order is in favour of the Respondent No. 5/society and it is benefited because of the order and no adverse consequences are faced by the Petitioners, because of the order of the State Government. The Petitioners, it appears, are challenging the order only because according to them the appointment of the Respondent No. 6 as a builder is not duly authorised by the members of the Respondent No. 5-society. It is also an admitted position that to this date the Petitioners have not instituted any proceedings challenging the decision of the Respondent No. 5-society to appoint the Respondent No. 6 as a builder. They have also not challenged the agreement which is entered into by the Respondent No. 5-society with the Respondent No. 6-builder. In this situation, therefore, the question that arises for consideration is would this Court be justified in entertaining this petition challenging the order passed by the State Government at the instance of the Petitioners. A person becomes entitled to challenge an order in a petition filed under Article 226 of the Constitution, if that person can be said to be aggrieved by that order. In other words only 'an aggrieved party' can maintain a petition under Article 226 of the Constitution of India. Such a view taken by this Court has been approved by the Supreme Court by its judgment in the case of Anand Sharadchandra Oka v. University of Mumbai and Ors. : AIR2008SC1289 .
9. The order is made on an application made by the society and it is apparent that it benefits the society. Therefore, if the society thinks that it is not in its interest, then the society can decline to take advantage of the order. It can also move the State Government to withdraw the order which it had earlier solicited. In our opinion, if the Petitioners who are members of the society are of the opinion either that the society should not take advantage of the order or that the society should move the State Government to withdraw the order, the Petitioners have to take steps in accordance with the provisions of Maharashtra Co.operative Societies Act and get appropriate resolution passed either by the Managing Committee or by the General Body of the society. They cannot approach this Court in its extra ordinary jurisdiction under Article 226 of the Constitution of India challenging the validity of the order.
10. The Constitution Bench of the Supreme Court in its judgment in the case of Daman Singh (supra) was considering the question whether notice of a proposal for amalgamation of a Co.operative Society is necessary to be issued to individual member of the Co.operative societies involved and in that context the Supreme Court in paragraph 11 of that judgment has made the following observations:
11. The next submission of the learned Counsel was that Sections 13(8), (9) and (10) did not make express provision for the issue of notice to the members of the concerned Co.operative Societies and were, therefore, violative of the principles of natural justice. He argued that in the absence of any provision, the rules of natural justice may be read into the provisions and notice to the members of the affected societies was imperative. Otherwise, he argued, members of one society would be forced against their will and without being heard to associate themselves with members of another society. We have no hesitation in rejecting this submission also. Once a person becomes a member of a co-operative society, he loses his individuality qua the society and he has no independent rights except those given to him by the statute and the by-laws. He must act and speak through the society or rather, the society alone can act and speak for him qua rights or duties of the society as a body. So if the statute which authorises compulsory amalgamation of co-operative societies provides for notice to the societies concerned, the requirement of natural justice is fully satisfied. The notice to the society will be deemed as notice to all its members. That is why Section 13(9)(a) provides for the issue of notice to the societies and not to individual members. Section 13(9)(b), however, provides the members also with an opportunity to be heard if they desire to be heard. Notice to individual members of a co.operative society, in our opinion, is opposed to the very status of a co.operative society as a body corporate and is therefore, unnecessary. We do not consider it necessary to further elaborate the matter except to point out that a member who objects to the proposed amalgamation within the prescribed time is given, by Section 31(11), the option to walk-out, as it were, by withdrawing his share, deposits or loans as the case may be.
Perusal of the above quoted observations of the Supreme Court shows that once a person becomes a member of the Co.operative Society, he loses his individuality qua the society and he must act and speak through the society and the society alone can act and speak for him qua rights or duties of the society as a body. In our opinion, therefore, if according to the Petitioners, the order impugned in the petition is not in the interest of the society, then it is for them to take action in accordance with the provisions of Maharashtra Co.operative Societies Act to make the Respondent No. 5-society to withdraw its application on the basis of which the order was made by the State Government.
11. The Supreme Court in its judgment in the case of C.O.D.Chheoki Employees's Co.op.society Ltd., referred to above was considering the constitutional validity of some provisions incorporated in the U.P. Co.operative Societies Act, 1965. The Supreme Court considered the position of the members of the society qua the co.operative society. Observations found in paragraphs 16 & 17 of the judgment are relevant for our purpose. They read as under:
16. Thus, it is settled law that no citizen has a fundamental right under Article 19(1)(c) to become a member of a Cooperative society. His right is governed by the provisions of the statute. So, the right to become or to continue being a member of the society is a statutory right. On fulfilment of the qualifications prescribed to become a member and for being a member of the society and on admission, he becomes a member. His being a member of the society is subject to the operation of the Act, rules and bye-laws applicable from time to time. A member of the society has no independent right qua the society and it is the society that is entitled to represent as the corporate aggregate. No individual member is entitled to assail the constitutionality of the provisions of the Act, rules and the bye-laws as he has his right under the Act, rules and the bye-laws and is subject to its operation. The stream cannot rise higher than the source.
17. So, the society having been formed is governed by the provisions of the Act. The individual members do not have any fundamental right to the management of the Committee except in accordance with the provisions of the Act, rules and bye-laws. The management of the Committee is regulated by Section 29 of the Act. The composition thereof is also regulated by the Act and has to be in accordance with the Rules and bye-laws. The Rules referred to hereinbefore have to be in furtherance of and in conformity with the provisions contained in Section 130(2)(xii) and (xii-A) and the Rules providing for reservation in the election of the Committee or for nomination to the Management Committee of the members belonging to the weaker sections and women should be to effectuate socio-economic and political justice assured by the Preamble. Articles 38 and 46 of the Constitution.
12. The Supreme Court in its judgment in the case of Zoroastrian Cooperative Housing Society Ltd. has considered its judgments in the case of Daman Singh referred to above and C.O.D.Chheoki Employees Co.operative Housing Society in paragraph 17, and in paragraph 22 the Supreme Court has observed thus: In the view of this Court, what was in the interest of the society was primarily for the society alone to decide and it was not for an outside agency to say. Where, however, the Government or the Registrar exercised statutory powers to issue directions to amend the bye-laws, such directions should satisfy the requirement of the interest of the society. This makes it clear that the interest of the society is paramount and that interest would prevail so long as there is nothing in the Act or the Rules prohibiting the promotion of such interest. Going by Chheoki Employees' Coop. Society Ltd.case neither the member, Respondent 2, nor the aspirant to membership, Respondent 3 had the competence to challenge the validity of the bye-laws of the Society or to claim a right to membership in the Society. Further the Supreme Court in paragraphs 27 & 30 of its judgment has observed thus:
27. Under the Contract Act, 1872, a person sui juris has the freedom to enter into a contract. The bye-laws of a cooperative society setting out the terms of membership to it, is a contract entered into by a person when he seeks to become a member of that society. Even the formation of the society is based on a contract. This freedom to contract available to a citizen cannot be curtailed or curbed relying on the fundamental rights enshrined in Part III of the Constitution against State action. A right to enforce a fundamental right against State action, cannot be extended to challenge a right to enter into a contract giving up an absolute right in oneself in the interests of an association to be formed or in the interests of the members in general of that association. This is also in lieu of advantages derived by that person by accepting a membership in the society. The restriction imposed, is generally for retaining the identity of the society and to carry forward the object for which the society was originally formed. It is, therefore, a fallacy to consider, in the context of cooperative societies, that the surrendering of an absolute right by a citizen who becomes a member of that society, could be challenged by the said member by taking up the position that the restriction he had placed on himself by entering into the compact, is in violation of his fundamental right of freedom of movement, trade or right to settle in any part of the country. he exercises his right of association when he becomes a member of a society by entering into a contract with others regulating his conduct vis-a-vis the society, the members constituting it, and submerging his right in the common right to be enjoyed by all and he is really exercising his right of association guaranteed by Article 19(1)(c) of the Constitution in that process. His rights merge in the rights of the society and are controlled by the Act and the bye-laws of the society.
30. It also appears to us, that a person after becoming a member of a cooperative society cannot seek to get out of the obligation undertaken by him while becoming a member of such a society by resort to the principle of public policy based on constitutional protections given to an individual as against State action. As noticed in Rodriguez v. Speyer Bros. and Fender v. Mildmay the considerations of public policy are disabling and not enabling. Observed Lord Sumner in Rodriguez: AIR 1917 918
Considerations of public policy are applied to private contracts or dispositions in order to disable, nor in order to enable.... I never heard of a legal disability from which a party or a transaction could be relieved because it would be good policy to do so.By invoking considerations of public policy, there appears to be no justification in relieving a member of a cooperative society of the obligations undertaken by him while joining it. The argument, therefore, that Respondent 2, herein, a member, should be relieved of the obligation undertaken by him while joining the Society or becoming its member or while seeking permission to put up a multi-storeyed construction, should be relieved of the restriction, he has agreed to, on the ground that the same might affect his fundamental rights guaranteed by Article 19(1)(d) or (g) of the Constitution or that it offends Article 300A of the Constitution cannot be accepted.
13. To our mind, therefore, it appears to be a settled law that a member of a co.operative society cannot be permitted to challenge the decision which is in favour of the society, by filing a petition under Article 226 of the Constitution. If according to a member the society should not take advantage of the order or that the decision is not really in favour of the society, then the remedy of such a member is to take steps in accordance with the provisions of Co.operative Societies and get appropriate resolution passed by the appropriate body of the society. According to the provisions of the Maharashtra Co.operative Societies Act the affairs of the societies are managed on democratic principles. A decision taken by Managing Committee is binding on all the members of the society. If according to a member of a society the decision has not been taken by the society in accordance with the provisions of the Co.operative Societies Act or the decision is contrary to some provisions in the Co.operative Societies Act, then his remedy is to move the Co.operative Court or the authorities under the Co.operative Societies Act to challenge the decision of the society.
14. So far as the judgments relied on by the learned Counsel appearing for the Petitioners for the purpose of showing that the Petition at the instance of the Petitioners should be entertained are concerned, those judgments are delivered in the petitions which were filed in public interest, therefore, in our opinion, those judgments are really not relevant.
15. In our opinion, one more aspect is relevant. The Petitioners, who are four in numbers, are making grievance that imposition of cess on the building is illegal. In paragraph 9 of the affidavit filed on behalf of the Respondent No. 5 following statement has been made:
9. I say that during that time, the then Managing Committee, of which the Petitioner No. 1 was a member, made an Application to the Asstt.Assessor & Collector for imposing repair cess on the said property which was exempted in the year 1979 and, therefore, the Society by their letter dated 19-3-1992 applied to the then Assessor & Collector for permitting the Society to pay repair cess in respect of the remaining structures. I crave leave to refer to and rely upon the said letter dated 19-3-1992, when produced.
Thus, a clear allegation is made that the Managing Committee of the Respondent No. 5-society of which the Petitioner No. 1 was the member in the year 1992 made an application for imposition of cess on the buildings, which were exempted from payment of cess in the year 1979. On behalf of the Petitioners, a rejoinder has been filed to the affidavit of the Respondent No. 5. Paragraph 6 of that rejoinder is relevant. It reads as under:
6. With reference to paragraph 9 of the said affidavit I say that the petitioners are not aware that the society vide letter dated 19-3-1992 had applied to the then Assessor and Collector for permitting the society to pay repair cess in respect of the remaining structures.It is, thus, clear that the allegation made in paragraph 9 that the Petitioner No. 1 was the signatory to the application made in the year 1992 for imposition of cess is not denied. In this situation, therefore, if one of the Petitioners was a party to the application seeking imposition of cess on the buildings which were exempted from payment of cess, in our opinion, it was for the Petitioners to explain as to why they are now challenging the imposition of cess on the buildings. To our mind, it is apparent that the Petitioners are disgruntled members of the Respondent No. 5 society, who are not supported by the majority of members of the society. Therefore, with the intention to obstruct the construction of the buildings, this petition has been filed. In our opinion, therefore, it will not be appropriate to judge the validity or otherwise of the order of the State Government dated 3-2-2003 at the instance of the Petitioners.
15. In the result, therefore, the petition fails and is dismissed. Rule discharged with no order as to costs.
At the request of the Petitioner, it is directed that the interim order which is presently operating in the petition will continue to operate for a period of eight weeks from today.