The plaintiff members of the defendant Club, had taken objection to two notices issued by the Club Secretary General: (1) and undated notice purporting to convene an Ordinary General Meeting on 18-2-1989 (at Delhi) inter alias for considering and approving further amendments to the Amended Rules and Regulation of the Club. The plaintiffs filed a suit for declaration and permanent injunction praying that the notices be declared null & void and defendant be restrained from holding the two meetings. They also filed an application fro ad-interim injunction.
The plaintiffs contended inter alias that the Executive Council had not authorised the Secretary General to convene the O. G. M. on 18-2-1986; that the Executive Council had authorised on E. O. M. for 29-1-1989, which had not been held, and that thereforee Secretary General could not, even under authority of Central Council, call for an E. O. G. M. on another date i.e. 18-2-1989.
Dismissing the Application, the Court
Held:
1. All members of the Executive Council are also members of the Central council. Since the Central Council has wider powers, the change of date cannot be said to be illegal. As per Rules, the notices of the meeting are to be issued by Secretary General as authorised by the Executive Committee or the Central Council as the case may be. But the decision to hold the meeting has to be taken by the Executive Committee or the Central Council. What is important is the decision. Fixing of a particular date is formal.
Siwanda Bhandare, J.
(1) The plaintiffs are members of defendant-National Sports Club of India which is a registered society under the Societies Registration Act, 1816. By an undated notice, the Secretary General of the defendant convened an Ordinary General Meeting on 18-2-4989 for the purpose of receiving, considering and adopting the audited statement of accounts of the Club for the years 1985 and 1986 and Annual Reports of the Auditor's and the Executive Committee. By :another undated notice, the Secretary General convened an Extra Ordinary General Meeting on February 18, 1989 at Delhi, inter alias for considering and approving further amendments to the Amended Rules & Regulations (pending fur approval before the Lt. Governor, Delhi) of the Club.
(2) The plaintiffs being aggrieved by this action of the Secretary General of the defendant filed the present suit for declaration and permanent injunction praying that the notices be declared as null and void and restrain the defendant from holding the Ordinary Genera! Meeting and Extra Ordinary General Meeting convened on 18-2-1989 and a further prayer that a declaration be issued declaring the proposed amendments as null and void. Along with the suit. the plaintiffs filed an application (I.A. 135S89) under Order 39 Rules I and 2 of the Code of Civil Procedure seeking ad interim injunction. The plaint and the injunction application was filed in tins Court on 15-2-1989.
(3) The main case of the plaintiffs in the plaint is that an Ordinary General Meeting can be called by the Executive Committee at such place and time as may be decided by it and since the Executive Committee had not authorised the Secretary General to convene the Ordinary General Meeting on I8-2-1989.. the Secretary General had no authority to convene that meeting. It is stated that the General Meeting is to be held at Delhi and Bombay alternatively unless the Executive Committee decides otherwise. Thus, since the last General Meeting had been held in Delhi, this General Meeting could have been held only in Bombay and not in Delhi. As regards the holding of the Extra Ordinary General Meeting on 18-2-1989 it is stated that the Executive Committee had authorised the Secretary General of convene an Extra Ordinary General Meeting on 29-1-1989 and not on 18-2-1989 and the Secretary General had convened the Extra Ordinary General Meeting on 18-2-1989 purportedly under the authority obtained from the Central Council. Thus, it is stated that though both. Executive Committee and Central Council, have the power to summon an Extra Ordinary General Meeting, once the Executive Committee had decided to summon the Extra Ordinary General Meeting on 29-1-1989 and since no meeting was held on 29-1-1989, the meeting convened on 18-2-1989 was illegal.
(4) When the case came up before the Court on 17-2-1989 a. element was made by the learned counsel for the defendant who had filed the Caveat that the Central Council of the defendant had met and approved the proposed amendments. He stated that several members had come from Bombay to attend the Annual General Meeting and the Extra Ordinary General Meeting. thereforee, it was directed that though the defendant may go ahead with the meetings, any resolutions passed at the meetings will not take effect till further orders.
(5) An affidavit has been Sled by the Vice-President of the defendant on 6th March, 1989 stating therein that a meeting of the Central Council of the defendant which consists of members from Bombay as well as Delhi region was held on 17-2-1989 at 12.00 noon at the Club premises in New Delhi. The 23rd Annual General Meeting of the defendant was held on 18-2-1989 at 2.30 P.M. and the Extra Ordinary General Meeting was held Pi 4.30 P.M. at the same place. He placed ors record the minutes of the meeting of the Central Council, the Annual General Meeting and the Extra Ordinary General Meeting.
(6) One of the items for consideration in the agenda of the Central Council meeting was to confirm the minutes of the Central Council meeting held on 7-1-1989. Certain objections were raised by some of the members of the Central Council to the omission in the minutes which were circulated. Accordingly, the draft minutes were amended and it was recorded as follow :
'THE President after taking sense of the house declared that it is an omission inadvertently committed by General Manager, and directed that the omission as pointed out by the Vice President should be recorded as hereunder on page 7 in the minutes of the Central Council Meeting held on 7-1-1989 at Bombay : 'The Annual General Meeting and Extra Ordinary General Meeting to be held in Delhi for passing the accounts already circulated for years 1985 & 1986 and amendments of Rules & Regulations respectively during early February. However, the date may be fixed by the Secretary General in consultation with the President.'
(7) It is stated in the affidavit that the Annual General Meeting was attended by 171 members and Extra Ordinary General Meeting was attended by 180 members and the resolutions and proposed amendments were carried out in accordance with the rules. It is further submitted that never before either in the Annual General Meeting or in the Extra Ordinary General Meeting as many as l80 members attended the meeting and in the past not more than 100 members-attended such meetings.
(8) A reply to the application filed by the plaintiffs under Order 39 Rule 1-2 of the Code of Civil Procedure has also been filed by the defendant. Along with the reply, the defendant has placed on record, affidavits of 24 members who attended the Central Council meeting on 17th February 1989. These members have stated on affidavit that the minutes circulated by the Secretary General of the meeting held on 7-1-1989 inadvertently did not reflect the factual position. The. omission was pointed out in the Central Council meeting; held on 17-2-1989 and accordingly it was decided to incorporate that part of the resolution in the minutes for the meeting held on 7-1-1989 and after this incorporation the minutes of the meeting of 7-l-l989 were confirmed. All these 24 member; had attended the meeting, of the Central- Council had on 7-1-1989. Thus. out of 35 members who attended the Central Council meeting on 7-1-1989. the majority of the members had certified that there was an inadvertent omission in the draft minutes of the meeting held on 7-1-1989 circulated by the Secretary General. The total strength of the Central Council is of 60 members. Out of which 30 members are from Bombay and 30 members are from Delhi.
(9) It is now contended by the learned counsel for the plaintiffs that in the meeting of the Executive Committee held on 16-12-1988 a decision was taken to hold a meeting of the Central Council on 7-1-1989 and the Extra Ordinary General Meeting on 29-1-1989. The meeting of the Central Council was held on 7-1-1989, however, the Extra Ordinary General Meeting was not held as per decision on 29-1-1989. It is submitted that under Rule 34 of the Rules & Regulations of the Club, the Central Council or the Executive Committee has the power to call an Extra Ordinary General Meeting and thus once the Executive Committee had called an Extra Ordinary General Meeting on 29-1-1989 it was not open to the Central Council to change the decision of the Executive Committee and call the meeting on 18-2-1989. It is submitted such a decision could not be legal because a decision to hold the Extraordinary General Meeting was taken by the Executive Committee which is a valid body and the Central Council could not over-ride that decision. Learned counsel submitted that even assuming for the sake of argument that the Central Council had the power to convene an Extra Ordinary General Meeting overriding the date fixed by the Executive Committee, in the present case in fact no such decision was taken by the Central Council on 7-1-1989. Learned counsel further submitted that the Central Council purported to correct the minutes of the meeting held on 7-1-1989, however, the probabilities in the case would show that this correction, was done only because the plaintiffs had filed the present suit. The discrepancies in the amendments tarried out were against general human conduct and were directed only to defeat the suit. Learned counsel pointed out the following probabilities which, according to him, cast a doubt on the amendments of the minutes '
(I)Under the Rules the Central Council could not have called the Annual General Meeting and vet the proposed amendments would show that they also convened the Annual General Meeting for 18-2-1989; (ii) the Central Council did not fix the date for the meeting but left it to the Secretary General to fix the date in consultation with the President. This is not ill compliance with Rules 33, 34 and 37 of the Rules and Regulations of the Club; and (iii) it is only after the Central Council had passed the resolution approving the amendments that the Extra Ordinary General Meeting could have been called but the Central Council passed the resolution approving the amendments only on 17-2-1989 but it took the decision to call the Extra Ordinary General Meeting on 7-1-198^. This shows that they were only trying to correct the mistake in order to defeat th& suit.
(10) Learned counsel further submitted that even if now the Central Council had decided to hold the meeting as notified by the Secretary General, the Central Council could not ratify the decision. Learned counsel submitted that the ratification cannot be done by majority Thus, all the members of the Central Council had to meet to ratify the decision and since all the 60 members were not present in the meeting of 7-1-J989, the notice for the Extra Ordinary General Meeting on 18-2-1989 is invalid. Learned counsel relied on Pennigton's Company Law, 5th Edition page 720, Palmer's Company Law, 24th Edition, page 869-870 and Chancery Division 1900 (Volume 2) page 230 in support of his contention. Learned counsel submitted that to change a. date is to change the decision and the members arc prejudiced because of the change of the date and it is infringement of the personal right of every member. So the meeting held on the changed date was invalid. It was submitted that the Central Council consists of 60 members and the proposed amendments- of the Rules can be placed before She Extra Ordinary General Meeting only if 314th of the members of the Central Council have passed a resolution in support of the amendment, learned counsel submitted that at present Central Council does not have its full strength and thus the resolution approving the amendment passed by 3/4th of the members present at the meeting of the. Central Council is invalid. Learned counsel submitted that {lie amendment of the Rules is a very important matter and unless the Central Council with its full. strength meets, it is not proper to pass the amendments.
(11) On the other hand, it was submitted by the learned counsel for the defendant that the plaintiffs who are neither members of the Executive Committee nor the members of the Central Council have no right to challenge the decision of the Central Council amending the minutes of the meeting of of 7-1-1989 and incorporating the omission in the amended minutes. Learned .counsel submitted that an overwhelming majority of the members of the Central Council who were present at both the meetings i.e, tile meeting held in Bombay on 7-1-1989 and the meeting held in Delhi on 17-1-1989 had realised and agreed that there was an inadvertent omission and, thereforee, they have given affidavits to that effect which have been filed in this Court. Learned Counsel submitted that the amendment of the minutes was, thereforee, only correction of the mistake in recording the minutes and that though the Central Council has the power to ratify the action of the Secretary General convening the meeting of the Extra Ordinary General Body on 18th, this was not a case of ratification but was only a case of correction of a mistake. Learned counsel submitted that the conduct of the plaintiffs disentitle them from getting the injunction. Learned counsel submitted that admittedly the notice convening the meetings was received by the plaintiffs on 31-1-1989 but they waited till 15-2-1989 to file the present suit. Learned counsel submitted that the members had arrived for the meeting from far off places and heavy expenditure had been incurred on air and 'rail fare and accommodation in Delhi. If the plaintiffs wanted postponement of the meeting they could have taken up the issue with the Executive Committee before rushing to this Court and the filing of the suit on the eye of the meeting showed that the suit and the injunction application .is not bona fide and in any event the plaintiffs are guilty of lathes. Learned counsel referred to Nelson's Law of injunction page 102 in support of this contention. Learned counsel submitted that under the existing rules and regulations of the Club, both, the Central Council as well as the Executive Committee has the power to call an Extra Ordinary General Meeting. The Central Council consists of 60 members; 30 members are to be elected from each region from all the. members of the Club. The Central Council under Rule 68(c) has the power to appoint and remove members of the Executive Committee and also regulate its proceedings and under Rule 68(e) .the Central Council can exercise all such powers delegated or entrusted to the Executive Committee. Thus, even though the Executive Committee had decided to convene the Annual 'General Meeting on 29-1-1989, the Central Council had the power to change the decision of the Executive Committee and could convene the meeting on some other date provided the requirement of notice in conformity with Rule 36 which stipulates that not less than a fortnight's notice in writing has to be given to members for convening the Ordinary or Extra Ordinary General Meeting is satisfied. Learned counsel submitted that under Rule 99(i) it is the duty of the Secretary General to issue notices of meeting-, of the Central Council, Executive Committee and various committees and sub-committees of the Club and prepare the agenda thereof and also perform such other duties and functions as may from time to time be prescribed by the President, the Central Council or the Executive Committee. Thus, the notices issued by the Secretary General convening the Annual General Meeting as well as the Extraordinary General meeting under the authority of the Executive Committee and the Central Council respectively was perfectly valid.
(12) The abovementioned facts thus indicate that the position regarding the validity of the Annual General Meeting and Extra Ordinary General Meeting convened for 18-2-1989 by the Secretary General before the suit was filed was different than the one after the suit was filed. Though it is true that from the minutes of the meeting held on 7-1-1989 it would appear that before the suit was filed the Central Council had not taken a decision to convene the Extra Ordinary General Meeting and the Annual General Meeting on 18-2-1989, after the minutes were corrected by the Central Council on 17-2-1989 the position is quite different. The corrected minutes make it clear that the Central Council authorised the Secretary General to call for a meeting of the General Body as well as the Extra Ordinary General Body on 18-2-1989 for the agenda circulated by the Secretary General. But can it be said that the correction of the minutes of 7-1-1989 was done by the Central Council with view to defeat the suit? According to the learned counsel for the plaintiff the Central Council did not have the power to call the Annual General Meeting and yet in the corrected .minutes m a hurry it is mentioned that the Secretary General was authorised to call the Annual General Meeting as well The Rules & Regulations of the 'Club are on record. Rule 68 of the Rules which provides for power of the Central Council is as follows -
'68.The Central Council may exercise all or any of the following powers :- (a) Suggest ways and means for carrying out the objects of the Club. (b) Elect President, Vice-President, Secretary or Honorary Secretary and a Treasurer or Honorary Treasurer of the Club. (c) Appoint and remove members of the Executive Committee and regulate its proceedings. (d) Elect patrons-in-chief, patrons and vice-patrons of the Club. (e) Exercise all such powers as are not by these Rules or by any resolution of the Club delegated or entrusted to the Executive Committee.'
(13) Thus, it is apparent that not only does the Central Council has the power to elect office bearers under Rule 68 (b) but it also has the power to appoint and remove members of the Executive Committee and regulate its proceedings under Rule 68 (c). Rule 68(e) gives power to the Central Council to exercise all such powers as are not by the Rules or by any resolution of the Club delegated or entrusted to the Executive Committee. Thus, the Central Council has much wider powers than the Executive Committee itself. Rule 70 entitles title Central Council to appoint all the members of the Executive Committee and to remove any member thereof and fill up any vacancy in the body. Rule 72 reads as follows : -
'THE Central Council may frame tales and regulations for the conduct of business by the Executive Committee and may vary, alter and modify the same from time to time and subject to any such rules the meetings and proceedings of the Executive Committee) shall be governed by the provisions herein contained for regulating the meetings and proceedings of the Central Council. The Executive Committee may frame any Rules for the conduct of its business not inconsistent with these Rules or any rules, framed by the Central Council for the conduct of business by the Executive Committee. The Chairman or in his absence the Vice-Chairman of the Executive Committee shall preside at all meetings of the Executive Committee and if the Vice-Chairman is not present then the members of the Executive Committee shall elect someone of their members to be the Chairman of such meeting.'
Under Rule 71, the Secretary of the Club elected by the Central Council under sub-rule (b) of Rule 68 functions as Secretary of the Executive Committee as well. Under Rule 99(i) the Secretary has the power to issue notices of meetings of the Central Council as well as the Executive Committee and prepare the agenda thereof. The members of the Executive Committee are selected from amongst the members of the Central Council.
(14) Thus, all the members of the Executive Committee are also members of the Central Council From the amended minutes which have been placed on record it appears that the Central Council took a decision to convene the Annual General Meeting and the Extra Ordinary General Meeting at Delhi for passing the accounts and amendments of the Rules respectively during early February. The Secretary General was authorised to fix the date in consultation with the President. From the notice issued by the Secretary General it appears that the notice for the Annual General Meeting was issued by the Secretary General by order of the Executive Committee and the notice of the Extra Ordinary General Meeting by order of the Central Council. Thus, prima-facie I do not find that the decision of the Central Council authorising the Secretary General also to convene the Annual General Meeting on 18-2-1989 is against general human conduct as alleged by the Plaintiffs. Since prima facie I am of the view that the Central Council has wider powers the change, of date also ; cannot be said to be illegal. As per the Rules the notices of the meeting are to be issued by the Secretary General as authorised by the Executive Committee or the Central Council as the case may be But the decision to hold the meeting has to be taken by the Executive Committee or the Central Council. What is important is the decision. Fixing of a particular date is formal and prima facie I do not find any error if the Secretary General is authorised to fix the date in consultation with the President. The plaintiffs are neither members of the Executive Committee nor the Central Council. As far as ordinary members arc concerned, the only requirement to be observed was that the meeting could not be convened by giving less than a fortnight's notice in writing. Rule 37 of the Rules provides that 'the notice Of the meeting to the members whether ordinary or extraordinary must specify the place, day and hour of the meeting with the statement of the business to be transacted at the meeting. Now, it is nobody's case that fortnight's notice was not given. Admittedly, the plaintiffs had received the notice of the meeting on 21-1-1989. Though the notice was undated since the meeting was to be held on 18-2-1989 it met the requirement. The notice also specifies the date, time and place. Thus, in my view, it cannot be said that the notice was contrary to Rules. In my view there was no infringement 'of the personal rights of the plaintiffs.
(15) It appears from the record that the corrections were carried out in the minutes of the meeting held on 7-1-1989 after considerable deliberations and by an over-whelming majority of members present at the meeting of the Central Council on 17-2-1989. Affidavits have been filed in this Court by most of the members who were present at both the 'meetings dated 7-1-1989 and 17-2-1989. The usual procedure followed regarding keeping the record of the proceedings of a meeting is that the Secretary makes notes at the meeting of the resolutions passed and subsequently enters in the minutes book after they are read and approved at. the next succeeding meeting. Thus. if there is any error committed by the Secretary in the draft minutes, the same can be corrected by the members in the next meeting. This u what was done in the present case. Thus, I do not find anything unnatural in the correction carried out on 17-2-1989 in the minutes of the meeting of 7-1-1989. Though it is true that the voice of the minority members cannot be suppressed, if a Club has to function in a democratic manner, the will of the majority of the members must prevail. A handful of members cannot stall the functioning of the Club. The governing principle in all democratic institutions is the rule by majority and once a decision is taken by majority, it is a decision binding on all.
(16) I do not find any force in the contention of the learned counsel for the plaintiffs that the Extra ordinary General Meeting could be called only after the Central Council had passed the proposed resolution for amendment. Rule 117 read as follows :
'NOalteration, addition or amendment shall be made in the foregoing rules until such alteration, addition or amendment is : (a) First accepted by the Central Council by three fourth of the members of the Central Council present at a meeting specially convened, and (b) Finally accepted by a majority of three Fourth of the members of the Club entitled to vote and present at a general meeting convened by a notice in which all the terms of the proposed alterations, additions or amendments shall be clearly set forth.'
(17) Thus, only after the amendments are accepted by three-fourth of the members of the Central Council present at a meeting specifically convened for that purpose, the amendments can be finally accepted by three-fourth majority at a general meeting. Sub 'rule (b) of Rule 117 further requires that the notice must clearly set out all the terms of the proposed amendments. The plaintiffs have not disputed the notice on the ground that it did not clearly set out the proposed amendments. Rule 117 does not require that the notice must state that the Central Council has accepted the proposed amendments. The only requirement is that before the general meeting accepts the amendments, the Central Council must accept the amendments as provided under Rule 117(a). No doubt amendments of the Rules and Regulations of the Club is a very important matter. thereforee the existing Rule 117 provides that not only the amendments must be accepted by three-fourth of the members present at the Central Council but must thereafter be accepted by three-fourth of the members of the Club present and entitled to vote in the general meeting.
(18) I find no merit in the contention that unless the Central Council meets with its full strength amendments cannot be passed. It is not open to the plaintiffs to challenge the meetings of the Central Council on the ground that the existing Central Council did not have its full strength. Rules 17 to 53 of the existing Rules specifically provide for the election to the Central Council. If some of the members of the Central Council have retired or resigned a specific provision is made in these Rules for the period of interregnum till fresh election takes place. Even factually the number given by the plaintiffs does not seem to be correct because from the documents filed it appears that 35 members of the Central Council attended the meeting on 7-1-1989 and 36 members attended the meeting held on 17th February 1989 and 4 members had asked for leave of absence. Since the plaintiffs have failed to make cut a prima facie case, in. my view, no injunction as prayed for can be granted at this stage.
(19) I.A. 1358189 is thus dismissed with costs quantified at Rs. 1000. Interim order dated 17-2-89 stands vacated.