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Sunday, April 27, 2014

Art.14 of constitution - admissions to Medical colleges , PG and Dental - Bulletin issued only Karnataka origin eligible to apply - challenged - Apex court held that In the result, we allow the writ petitions, declare sub-clause (a) of clause 2.1 of the two Information Bulletins for post graduate medical and dental courses for PGET-2014 as ultra-vires Article 14 of the Constitution and null and void. = Vishal Goyal & Ors. … Petitioners Versus State of Karnataka & Ors. … Respondents = 2014 ( April.Part ) judis.nic.in/supremecourt/filename=41466

       Art.14 of constitution - admissions to Medical colleges , PG and Dental - Bulletin issued only Karnataka origin eligible to apply - challenged -  Apex court held that In the result, we allow the writ petitions, declare sub-clause (a)  of clause 2.1 of the two Information Bulletins for post  graduate  medical  and dental courses for PGET-2014 as ultra-vires Article 14 of  the  Constitution and null and void.  = 
The case of the petitioners is  that  by
virtue of sub-clause (a) of clause 2.1 of  the  two  Information  Bulletins,
they are debarred from appearing in the Entrance  Tests  for  admissions  to
MD/MS/Medical Post Graduate Diploma Courses,  2014  or  to  MDS/Dental  Post
Graduate Diploma Courses, 2014 in the State of Karnataka  even  though  they
have studied MBBS/BDS in institutions  in  the  State  of  Karnataka.   They
have, therefore,  challenged  sub-clause  (a)  of  clause  2.1  of  the  two
Information Bulletins, as ultra vires Article  14  of  the  Constitution  as
interpreted by this Court in Dr. Pradeep Jain and Others v. Union  of  India
and Others [(1984) 3 SCC 654].  They also  contend  that  in  the  aforesaid
case of Dr. Pradeep Jain  (supra),  this  Court  has  held  that  a  certain
percentage  of  seats  must  be  reserved  on  the  basis  of  institutional
preference to enable students who have  passed  MBBS  or  BDS  courses  from
medical or dental colleges in the State of Karnataka  to  get  admission  to
Post Graduate medical or dental courses in the medical  or  dental  colleges
of the State of Karnataka.  The petitioners  have,  therefore,  prayed  that
sub-clause (a) of clause 2.1 of the two Information  Bulletins  be  declared
as ultra vires the Constitution and  appropriate  writs  and  directions  be
issued to the respondents to permit the petitioners to  participate  in  the
admission process of MD/MS/MDS and other Post Graduate  medical  and  dental
courses in the State of Karnataka.=
  In Magan Mehrotra v. Union of India (supra) and Saurabh Chaudri v. Union  of
India (supra) also, this Court  has  approved  the  aforesaid  view  in  Dr.
Pradeep Jain’s Case that excellence  cannot  be  compromised  by  any  other
consideration for the purpose of admission to postgraduate  medical  courses
such as MD/MS and  the  like  because  that  would  be  detrimental  to  the
interests  of  the  nation  and  will  affect  the  right  to  equality   of
opportunity under Article 14 of the Constitution.

10.   Mr. Mariarputham is right that in Saurabh Chaudri v.  Union  of  India
(supra), this Court has held that   institutional preference  can  be  given
by a State, but in the aforesaid decision of Saurabh Chaudri,  it  has  also
been held that decision of the State to give  institutional  preference  can
be invalidated by the Court in the event it is shown that  the  decision  of
the State is ultra vires the right to  equality  under  Article  14  of  the
Constitution.  When we examine sub-clause (a)  of  clause  2.1  of  the  two
Information  Bulletins,  we  find  that  the  expression  “A  candidate   of
Karnataka Origin” who only is eligible to appear for Entrance Test has  been
so defined as to exclude a candidate who has  studied  MBBS  or  BDS  in  an
institution in the State of Karnataka but who does  not  satisfy  the  other
requirements of sub-clause (a) of clause 2.1  of  the  Information  Bulletin
for PGET-2014.  Thus, the institutional preference sought  to  be  given  by
sub-clause (a) of clause 2.1 of the Information Bulletin  for  PGET-2014  is
clearly contrary to the judgment of this Court in Dr.  Pradeep  Jain’s  case
(supra).  To quote from paragraph 22 of the judgment in Dr.  Pradeep  Jain’s
case:


           “……  a  certain  percentage  of  seats  may   in   the   present
           circumstances,  be  reserved  on  the  basis  of   institutional
           preference in the sense that  a  student  who  has  passed  MBBS
           course from a  medical  college  or  university,  may  be  given
           preference for admission to the postgraduate course in the  same
           medical college or university…..”


Sub-clause (a) of clause 2.1 of  the  two  Information  Bulletins  does  not
actually give institutional preference to students who have passed  MBBS  or
BDS from Colleges or Universities in the State of Karnataka, but makes  some
of them ineligible to take the Entrance Test for admission to Post  Graduate
Medical  or  Dental  courses  in  the  State  of  Karnataka  to  which   the
Information Bulletins apply.

11.   We now come to the  argument  of  Mr.  Mariarputham  that  the  scheme
formulated by this Court in Dr. Dinesh Kumar and  Others  v.  Motilal  Nehru
Medical College, Allahabad and Others (supra) pursuant to  the  judgment  in
Dr. Pradeep Jain’s case (supra) is confined to medical and  dental  colleges
or institutions run by the Union  of  India  or  a  State  Government  or  a
Municipal or other local authority and does not  apply  to  private  medical
and dental colleges or institutions.  Paragraph (1) of the scheme  on  which
Mr. Mariarputham relied on is extracted hereinbelow:


           “(1) In the first  place,  the  Scheme  has  necessarily  to  be
           confined to medical colleges or institutions run by the Union of
           India or a State  Government  or  a  municipal  or  other  local
           authority.  It cannot  apply  to  private  medical  colleges  or
           institutions unless they are instrumentality or  agency  of  the
           State or opt to join the Scheme by making 15  per  cent  of  the
           total number of seats for the MBBS/BDS course and 25 per cent of
           the  total  number  of  seats  for  the  post-graduate   course,
           available for admission on  the  basis  of  All  India  Entrance
           Examination.  Those medical colleges or  institutions  which  we
           have already excepted from the operation of the  judgment  dated
           June 22, 1984 will continue to remain outside the scope  of  the
           Scheme.”

This Court has, thus, said in the aforesaid  paragraph  (1)  of  the  scheme
that the scheme cannot apply to  private  medical  and  dental  colleges  or
institutions unless they are instrumentalities or agencies of the  State  or
opt to join the scheme.  The reason for this is  that  private  medical  and
dental colleges or institutions not being State or its instrumentalities  or
its agencies were not subject to the equality clauses in Article 14  of  the
Constitution, but the moment some seats in the private  medical  and  dental
colleges or institutions come to the State quota, which have  to  be  filled
up by the State or its instrumentality or its agency which  are  subject  to
the equality clauses in Article 14 of the Constitution, the principles  laid
down by this Court in Dr. Pradeep  Jain’s  case  (supra)  will  have  to  be
followed while granting admissions to the seats allotted to the State  Quota
in post graduate medical and dental courses even in private colleges.

12.   In the result, we allow the writ petitions, declare sub-clause (a)  of
clause 2.1 of the two Information Bulletins for post  graduate  medical  and
dental courses for PGET-2014 as ultra-vires Article 14 of  the  Constitution
and null and void.   The  respondent  will  now  publish  fresh  Information
Bulletins and do the admissions to the  post  graduate  medical  and  dental
courses in the Government colleges  as  well  as  the  State  quota  of  the
private colleges in accordance with the law by the end of June, 2014 on  the
basis of the results of the Entrance Test already held.  We also order  that
the general time schedule for counselling and admissions  to  post  graduate
Medical Courses in our order dated 14.03.2014 in Dr. Fraz Naseem &  Ors.  v.
Union of India will not apply to such admissions in the State  of  Karnataka
for the academic year 2014-2015.  Similarly, the general time  schedule  for
counselling and admissions for post graduate dental courses will  not  apply
to such admissions in the State of Karnataka.  The parties shall bear  their
own costs.

2014 ( April.Part ) judis.nic.in/supremecourt/filename=41466
A.K. PATNAIK, FAKKIR MOHAMED IBRAHIM KALIFULLA
                                                     'REPORTABLE'

                        IN THE SUPREME COURT OF INDIA

                         CIVIL ORIGINAL JURISDICTION

                    WRIT PETITION (CIVIL) NO. 48 OF 2014


Vishal Goyal & Ors.                                … Petitioners

                                   Versus

State of Karnataka & Ors.                             … Respondents


                                    WITH

                    WRIT PETITION (CIVIL) NO. 70 OF 2014,
                    WRIT PETITION (CIVIL) NO. 72 OF 2014,
                    WRIT PETITION (CIVIL) NO. 75 OF 2014,
                    WRIT PETITION (CIVIL) NO. 65 OF 2014,
                    WRIT PETITION (CIVIL) NO. 92 OF 2014,
                    WRIT PETITION (CIVIL) NO.156 OF 2014,
                    WRIT PETITION (CIVIL) NO. 83 OF 2014,
                    WRIT PETITION (CIVIL) NO. 87 OF 2014
                                     AND
                    WRIT PETITION (CIVIL) NO.196 OF 2014





                               J U D G M E N T



A.K. PATNAIK, J.
      This batch of writ petitions under  Article  32  of  the  Constitution
relates to admissions in Post Graduate Medical Dental courses in  Government
medical and dental colleges as  well  as  in  the  State  Quota  in  private
medical and dental colleges in the State of Karnataka.

2.    The petitioners claim that they were selected on the basis  of  common
entrance tests conducted by the CBSE or by  the  authorities  of  the  State
Government or by the association of private medical and dental  colleges  in
the State of Karnataka and admitted into the MBBS/BDS courses  in  different
Government or private medical  and  dental  colleges  and  after  completing
their MBBS/BDS courses were keen to get admitted into Post Graduate  medical
or dental courses in the year 2014.

3.    The National Board of Examinations issued  two  Information  Bulletins
for Post Graduate Entrance  Test,  2014  (for  short  ‘the  PGET-2014’)  for
admissions to the State Quota seats in  Karnataka  Government  Colleges  and
Institutions   and   Karnataka   Government   Quota   seats    in    private
colleges/institutions/deemed  universities.   One  Bulletin  contained   all
information for admission to MD/MS/Medical  Post  Graduate  Diploma  Courses
(Medical) and the other contained all information for  admission  to  MDS/PG
Diploma Courses (Dental).  Clause 2  of  these  Information  Bulletins  lays
down the criteria for PGET-2014.  Clause 2.1 of these Information  Bulletins
for  PGET-2014  provides  that  no  candidate  shall  be   admitted   to   a
professional educational institution  unless  the  candidate  possesses  the
qualifications or eligibility to appear for  the  entrance  test  stipulated
thereunder.  The said clause 2.1 of the two Information Bulletins, which  is
identically  worded  for  admissions  to  Post  Graduate  Medical  and  Post
Graduate Dental Courses, is extracted hereinbelow:
      2.1. No candidate shall be  admitted  to  a  professional  educational
      institution   unless   the   candidate   possesses    the    following
      qualifications or eligibility to appear for the Entrance test namely:


             a. He is a citizen of India who is of Karnataka origin and has
             studied MBBS/BDS degree in a Medical/Dental  college  situated
             in Karnataka or  outside  Karnataka,  and  affiliated  to  any
             university established by law in India recognized  by  Medical
             Council of India and Government of India.


             Explanation:  “A  candidate  of  Karnataka  Origin”  means   a
             candidate found eligible  under  clause  (i)  or  (ii)  below,
             namely:


             i. A candidate who has studied  and  passed  in  one  or  more
             Government recognized, educational institutions located in the
             State of Karnataka for a minimum period of TEN academic  years
             as on the last date fixed for the  submission  of  application
             form, commencing from 1st standard to MBBS/BDS and  must  have
             appeared and passed either SSLC/10th standard or 2nd  PUC/12th
             standard examination from Karnataka State.   In  case  of  the
             candidate who has taken more than one year to pass a class  or
             standard, the years of academic study is counted as  one  year
             only.


             Documents to be produced, namely:


             1) SSLC or 10th Standard Marks Card;


             2) 2nd PUC of 12th Standard Marks Card of the candidate;


             3) Candidates Study Certificate: A study certificate from  the
             Head of educational institution where he or she  had  studied.
             Further, School Study Certificates should be counter signed by
             the concerned Block Education Officer (BEO)/Deputy Director of
             Public  Instructions  (DDPI)  COMPULSORILY  in  the   proforma
             prescribed;


             4) Qualifying degree certificate and all phases marks card;


             5)  Domicile  certificate  issued  by  the  Tahsildar  in  the
             prescribed proforma (Annexure-I); and if claiming  reservation
             benefits: Caste/Caste Income Certificate issued  by  Concerned
             Tahsildar – For SC/ST in Form-D, Category-1 in Form-E and  2A,
             2B, 3A and 3B in Form F.


             6) MCI/DCI State Council Registration Certificate.


             7)  Attempt  Certificate  issued  by  the  concerned   college
             Principal.


             ii. The candidate should have studied and passed 1st  and  2nd
             years Pre-University Examination or  11th  and  12th  standard
             examination within the State of Karnataka from an  Educational
             Institution run or  recognized  by  the  State  Government  or
             MBBS/BDS from a professional educational  institution  located
             in Karnataka and  that  either  of  the  parents  should  have
             studied in Karnataka for a minimum period of 10 years.


             Documents to be produced, namely:


             1) SSLC or 10th Standard Marks Card;


             2) 2nd PUC of 12th Standard Marks Card of the candidate;


             3) Qualifying degree certificate and all phases marks card;


             4)  Domicile  certificate  issued  by  the  Tahsildar  in  the
             prescribed proforma (Annexure-I);


             5)  If  claiming  reservation  benefits:  Caste/Caste   Income
             Certificate issued by Concerned Tahsildar – For SC/ST in Form-
             D, Category-1 in Form-E and 2A, 2B, 3A and 3B in Form F and


             6) (a) A study certificate for either  of  the  parent  having
             studied for at least 10 years in Karnataka from  the  Head  of
             the  educational  institution  where   he/she   had   studied.
             Further, school study certificates should be countersigned  by
             the concerned Block Educational Officer (BEO)/ Deputy Director
             of Public Instructions (DDPI)  COMPULSORILY  in  the  proforma
             prescribed (Annexure-III);


             (b) The candidates study certificate for having  studied  both
             1st and 2nd PUC or 11th & 12th Standard in Karnataka issued by
             the head of the educational institution.


             7) MCI/DCI State Council Registration Certificate


             8) Attempt Certificate issued by the concerned Principal.


4.    It will be clear from sub-clause (a) of clause 2.1 of the  Information
Bulletins extracted above that to be eligible to  appear  for  the  Entrance
Test, a candidate must be of “Karnataka Origin”.  The Explanation under sub-
clause (a) of clause 2.1 of the Information Bulletins gives the  meaning  of
“A candidate of Karnataka Origin”.  The case of the petitioners is  that  by
virtue of sub-clause (a) of clause 2.1 of  the  two  Information  Bulletins,
they are debarred from appearing in the Entrance  Tests  for  admissions  to
MD/MS/Medical Post Graduate Diploma Courses,  2014  or  to  MDS/Dental  Post
Graduate Diploma Courses, 2014 in the State of Karnataka  even  though  they
have studied MBBS/BDS in institutions  in  the  State  of  Karnataka.   They
have, therefore,  challenged  sub-clause  (a)  of  clause  2.1  of  the  two
Information Bulletins, as ultra vires Article  14  of  the  Constitution  as
interpreted by this Court in Dr. Pradeep Jain and Others v. Union  of  India
and Others [(1984) 3 SCC 654].  They also  contend  that  in  the  aforesaid
case of Dr. Pradeep Jain  (supra),  this  Court  has  held  that  a  certain
percentage  of  seats  must  be  reserved  on  the  basis  of  institutional
preference to enable students who have  passed  MBBS  or  BDS  courses  from
medical or dental colleges in the State of Karnataka  to  get  admission  to
Post Graduate medical or dental courses in the medical  or  dental  colleges
of the State of Karnataka.  The petitioners  have,  therefore,  prayed  that
sub-clause (a) of clause 2.1 of the two Information  Bulletins  be  declared
as ultra vires the Constitution and  appropriate  writs  and  directions  be
issued to the respondents to permit the petitioners to  participate  in  the
admission process of MD/MS/MDS and other Post Graduate  medical  and  dental
courses in the State of Karnataka.

5.    Soon after the writ petitions were filed and moved, this Court  passed
orders permitting the petitioners to take the Entrance  Test  for  admission
to Post Graduate medical and  dental  courses  in  the  State  of  Karnataka
conducted by the National Board of Examinations and  pursuant  to  the  said
orders the petitioners have also been permitted to take the Entrance Test.
6.    Learned counsel for the petitioners submitted  that  the  judgment  of
this Court in Dr. Pradeep  Jain’s  case  (supra)  still  holds  good.   They
referred to the decision of this Court in Magan Mehrotra v. Union  of  India
[(2003) 11 SCC 186], Saurabh Chaudri v. Union of India [(2003) 11  SCC  146]
and Nikhil Himthani v. State of Uttarakhand & Others [(2013)  10  SCC  237],
in which this Court has reiterated the principles laid down in  Dr.  Pradeep
Jain’s case (supra).  They submitted that  this  Court,  should,  therefore,
strike down sub-clause (a) of clause 2.1 of the  two  Information  Bulletins
as  ultra  vires  the  Constitution  and  direct  the  respondents  to  give
institutional preference in accordance of the  judgment  in  Pradeep  Jain’s
case.

7.    In reply to the contentions of the petitioners, Mr.  A.  Mariarputham,
learned senior counsel appearing for the State of Karnataka, relied  on  the
statements of objections filed on behalf of  the  State  of  Karnataka.   He
submitted  that  Article  371J  of  the  Constitution  is  titled   ‘Special
Provisions with respect to State of Karnataka’  and  Clause  (2)  read  with
Clause (1) sub-clause (C) of this Article provides that  the  Governor  may,
by order make reservation of  a  proportion  of  seats  in  educational  and
vocational training  institutions  in  the  Hyderabad-Karnataka  region  for
students who belong to that region by birth or by  domicile.   He  submitted
that the State of Karnataka has, therefore, fixed  institutional  preference
quota of 50% and this was constitutionally permissible as per  the  judgment
of this Court in Saurabh Chaudri v. Union of India (supra).

8.    Mr. Mariarputham next submitted that pursuant to the judgment of  this
Court in Dr. Pradeep Jain’s case (supra), a scheme has  been  formulated  by
this Court in Dr. Dinesh Kumar and Others v. Motilal Nehru Medical  College,
Allahabad and Others [(1986) 3 SCC 727] and a reading  of  the  said  scheme
would  show  that  it  applies  to  only  medical  and  dental  colleges  or
institutions run by the Union of India or a State Government or a  Municipal
and other local authority.  He submitted that the judgments  of  this  Court
in Dr. Pradeep Jain’s case  (supra)  and  in  Dinesh  Kumar  and  Others  v.
Motilal Nehru Medical College, Allahabad and Others (supra),  therefore,  do
not apply to private medical and dental college in the State  of  Karnataka.
He explained that the State of Karnataka has also a quota of  seats  in  the
private medical and dental colleges in the State of Karnataka and the  seats
for Post Graduate medical and dental courses that fall in  the  State  quota
can be filled up by the State from among the candidates of Karnataka  Origin
as provided  in  sub-clause  (a)  of  clause  2.1  of  the  two  Information
Bulletins.

9.    We have considered the submissions of learned counsel for the  parties
and we find that the basis of the judgment of  this  Court  in  Dr.  Pradeep
Jain’s case (supra) is Article 14 of the Constitution  which  guarantees  to
every person equality before the law and equal protection of the  laws.   As
explained by this court in paragraphs 12 and 13 of the judgment   in  Nikhil
Himthani v. State of Uttarakhand & Others (supra):


      “12. Article  14  of  the  Constitution  guarantees  to  every  person
      equality before law and equal protection of laws.  In  Jagadish  Saran
      v. Union of India (1980) 2 SCC 768,  Krishna  Iyer,  J.,  writing  the
      judgment on behalf of the three Judges referring to Article 14 of  the
      Constitution held that equality of opportunity for every person in the
      country is the constitutional guarantee and therefore  merit  must  be
      the test for selecting candidates, particularly in the  higher  levels
      of education like postgraduate medical courses, such as  MD.   In  the
      language of Krishna Iyer, J. (SCC pp.778-79, para 23)


           “23. Flowing  from  the  same  stream  of  equalism  is  another
           limitation.   The  basic  medical  needs  of  a  region  or  the
           preferential push  justified  for  a  handicapped  group  cannot
           prevail in the same measure all the highest scales of  specialty
           where the best skill or talent, must be handpicked by  selecting
           according to capability.  At the level of PhD, MD, or levels  of
           higher proficiency, where international  measure  of  talent  is
           made, where losing one great scientist or  technologist  in-the-
           making is a national loss, the considerations we  have  expanded
           upon a important lose their potency.  Here,  equality,  measured
           by matching excellence, has more meaning and cannot  be  diluted
           much without grave risk.”


      13. Relying on the aforesaid reasons in Jagadish  Saran  v.  Union  of
      India, a three-Judge Bench of this Court in  Pradeep  Jain  case  held
      excellence cannot be compromised by any other  consideration  for  the
      purpose of admission to postgraduate medical courses such as MD/MS and
      the like because that would be detrimental to  the  interests  of  the
      nation and therefore reservation based on residential  requirement  in
      the State will affect the  right  to  equality  of  opportunity  under
      Article 14 of the Constitution……..”


In Magan Mehrotra v. Union of India (supra) and Saurabh Chaudri v. Union  of
India (supra) also, this Court  has  approved  the  aforesaid  view  in  Dr.
Pradeep Jain’s Case that excellence  cannot  be  compromised  by  any  other
consideration for the purpose of admission to postgraduate  medical  courses
such as MD/MS and  the  like  because  that  would  be  detrimental  to  the
interests  of  the  nation  and  will  affect  the  right  to  equality   of
opportunity under Article 14 of the Constitution.

10.   Mr. Mariarputham is right that in Saurabh Chaudri v.  Union  of  India
(supra), this Court has held that   institutional preference  can  be  given
by a State, but in the aforesaid decision of Saurabh Chaudri,  it  has  also
been held that decision of the State to give  institutional  preference  can
be invalidated by the Court in the event it is shown that  the  decision  of
the State is ultra vires the right to  equality  under  Article  14  of  the
Constitution.  When we examine sub-clause (a)  of  clause  2.1  of  the  two
Information  Bulletins,  we  find  that  the  expression  “A  candidate   of
Karnataka Origin” who only is eligible to appear for Entrance Test has  been
so defined as to exclude a candidate who has  studied  MBBS  or  BDS  in  an
institution in the State of Karnataka but who does  not  satisfy  the  other
requirements of sub-clause (a) of clause 2.1  of  the  Information  Bulletin
for PGET-2014.  Thus, the institutional preference sought  to  be  given  by
sub-clause (a) of clause 2.1 of the Information Bulletin  for  PGET-2014  is
clearly contrary to the judgment of this Court in Dr.  Pradeep  Jain’s  case
(supra).  To quote from paragraph 22 of the judgment in Dr.  Pradeep  Jain’s
case:


           “……  a  certain  percentage  of  seats  may   in   the   present
           circumstances,  be  reserved  on  the  basis  of   institutional
           preference in the sense that  a  student  who  has  passed  MBBS
           course from a  medical  college  or  university,  may  be  given
           preference for admission to the postgraduate course in the  same
           medical college or university…..”


Sub-clause (a) of clause 2.1 of  the  two  Information  Bulletins  does  not
actually give institutional preference to students who have passed  MBBS  or
BDS from Colleges or Universities in the State of Karnataka, but makes  some
of them ineligible to take the Entrance Test for admission to Post  Graduate
Medical  or  Dental  courses  in  the  State  of  Karnataka  to  which   the
Information Bulletins apply.

11.   We now come to the  argument  of  Mr.  Mariarputham  that  the  scheme
formulated by this Court in Dr. Dinesh Kumar and  Others  v.  Motilal  Nehru
Medical College, Allahabad and Others (supra) pursuant to  the  judgment  in
Dr. Pradeep Jain’s case (supra) is confined to medical and  dental  colleges
or institutions run by the Union  of  India  or  a  State  Government  or  a
Municipal or other local authority and does not  apply  to  private  medical
and dental colleges or institutions.  Paragraph (1) of the scheme  on  which
Mr. Mariarputham relied on is extracted hereinbelow:


           “(1) In the first  place,  the  Scheme  has  necessarily  to  be
           confined to medical colleges or institutions run by the Union of
           India or a State  Government  or  a  municipal  or  other  local
           authority.  It cannot  apply  to  private  medical  colleges  or
           institutions unless they are instrumentality or  agency  of  the
           State or opt to join the Scheme by making 15  per  cent  of  the
           total number of seats for the MBBS/BDS course and 25 per cent of
           the  total  number  of  seats  for  the  post-graduate   course,
           available for admission on  the  basis  of  All  India  Entrance
           Examination.  Those medical colleges or  institutions  which  we
           have already excepted from the operation of the  judgment  dated
           June 22, 1984 will continue to remain outside the scope  of  the
           Scheme.”

This Court has, thus, said in the aforesaid  paragraph  (1)  of  the  scheme
that the scheme cannot apply to  private  medical  and  dental  colleges  or
institutions unless they are instrumentalities or agencies of the  State  or
opt to join the scheme.  The reason for this is  that  private  medical  and
dental colleges or institutions not being State or its instrumentalities  or
its agencies were not subject to the equality clauses in Article 14  of  the
Constitution, but the moment some seats in the private  medical  and  dental
colleges or institutions come to the State quota, which have  to  be  filled
up by the State or its instrumentality or its agency which  are  subject  to
the equality clauses in Article 14 of the Constitution, the principles  laid
down by this Court in Dr. Pradeep  Jain’s  case  (supra)  will  have  to  be
followed while granting admissions to the seats allotted to the State  Quota
in post graduate medical and dental courses even in private colleges.

12.   In the result, we allow the writ petitions, declare sub-clause (a)  of
clause 2.1 of the two Information Bulletins for post  graduate  medical  and
dental courses for PGET-2014 as ultra-vires Article 14 of  the  Constitution
and null and void.   The  respondent  will  now  publish  fresh  Information
Bulletins and do the admissions to the  post  graduate  medical  and  dental
courses in the Government colleges  as  well  as  the  State  quota  of  the
private colleges in accordance with the law by the end of June, 2014 on  the
basis of the results of the Entrance Test already held.  We also order  that
the general time schedule for counselling and admissions  to  post  graduate
Medical Courses in our order dated 14.03.2014 in Dr. Fraz Naseem &  Ors.  v.
Union of India will not apply to such admissions in the State  of  Karnataka
for the academic year 2014-2015.  Similarly, the general time  schedule  for
counselling and admissions for post graduate dental courses will  not  apply
to such admissions in the State of Karnataka.  The parties shall bear  their
own costs.




                                          .....……………..……………………….J.
                                    (A. K. Patnaik)






                          …....…………..………………………..J.
                                 (Fakkir Mohamed Ibrahim Kalifulla)

New Delhi,
April 24, 2014.

-----------------------
15


Co-operative Societies Act - Auction for sale of land was conducted with the permission and by following due procedure - Handful persons who have not objected at the time of Board meetings ,and at the time of sale - can not challenge the same on surmises - A defunct society can not ask for revertion of duly sold property - High court orders are confirmed = J.N. Chaudhary & Ors. Etc. ..Appellants Versus State of Haryana & Ors. ..Respondents= 2014 ( April.Part ) judis.nic.in/supremecourt/filename=41463

Co-operative Societies Act - Auction for sale of land was conducted with the permission and by following due procedure - Handful persons who have not objected at the time of Board meetings ,and at the time of sale - can not challenge the same on surmises - A defunct society  can not ask for revertion of  duly  sold property   - High court orders are confirmed  =
Thus  in a  matter  where
the decision has been  taken collectively  by the  General  Body   reflected
in the form  of a  resolution   passed by the  General  Body,  it  would  be
unjust and inappropriate  to nurture a lurking  doubt  and  keep  suspecting
the decision by entertaining   the  version  of  a  handful   who  might  be
disgruntled  or might be  genuine  but  would be difficult to be gauged   by
any court  so as to  over-rule  the  General  Body  resolution   and  accept
the view of the   minority  based  on  no  evidence  except  assumption  and
speculation.  
If the  instant matter is viewed meticulously, it  is  clearly
obvious   that   the  appellants  have   expected   the   court   of    writ
jurisdiction to enter into  the correctness  and  validity  of  the  auction
sale   essentially  by  expecting  the   Court  to  draw  inference  without
evidence  that the auction sale was not bona fide as it did not  fetch   the
 desired value  of the land contrary to the materials available  on  record.
Plethora of circumstances have been related to establish   the   same  which
clearly are in the realm of  conjecture  and  speculation,  yet  the  Single
Judge and the Division Bench  have both   scrutinized  and  considered   the
same and have recorded a finding against the   appellants  which  cannot  be
held   to  suffering  from   perversity  being  contrary  to  the   existing
materials before  the  Court  which  have  been  relied  upon.   
Thus,   the
validity and correctness of the General Body  resolution in view   of  which
the land was put to  auction  sale  cannot  be   allowed  to    be  assailed
specially when the price/alleged under valuation of the land in the  auction
sale no longer survives as the High  Court  has allowed  the  value  of  the
land  to be increased by increasing  it from Rs. 40  lakhs  to  Rs.70  lakhs
per acre which  has been ordered to be paid  along with 6 %  interest.   
The
appellants have not furnished  any material as noted by the High Court  that
the cost of the land in the year of the date of auction which  is  2003  was
more than Rs.70 lakhs per acre so as to  offer a cause  to  interfere   even
if it were  to be interfered in the interest of  equity,  justice  and  fair
play specially when the circle rate of the land in the year  2003  when  the
auction was held was Rs.12 lacs per acre only.
37.         Hence, the endeavour of the appellants  that  the  auction  sale
should be set aside and the land  be   revived  to  the  society  cannot  be
entertained in absence   of  proof of mala fide  contrary  to  the  existing
materials on record on the basis  of speculation, assumption  and  inference
urged by the appellants.
38.         Assuming  for a while although not conceding that the land  were
to be reverted  to the  co-operative  society  for any reason whatsoever  at
this stage after 11 years of the sale during  which  the  appellant  Society
has practically ceased to exist where all members except ten out of 288  are
left, it is obvious  that the  land  cannot  be  reverted  to  the  original
members who have taken their refund.  
In that event, the appellant  –society
through a handful of members numbering ten is bound to  indulge  in  trading
of the land by inducting new members quoting new  rates  at  their  instance
clearly sacrificing  the very spirit   of  a  co-operative  society  as  the
land cannot be marketed even by the defunct Co-operative Society at the  old
rate which land had been purchased out  of  the  contribution  made  by  the
erstwhile 288 members out of which only 10 are now left into  the  fray  who
had never even objected to the General Body  Resolution  approving  sale  of
the land nor challenged the auction sale in the year 2003 when  the  auction
was held.
39.         We, thus  find  no  illegality  or  infirmity  in  the  impugned
judgments and orders passed by the single Bench as also the  Division  Bench
concurrently refusing to set aside the auction sale held  11  years  ago  in
the  year  2003  at  the  instance  of  a  Co-operative  Society  which  has
practically been rendered defunct and thus ceased to exist  apart  from  the
other  weighty  reasons  discussed  hereinbefore.   Consequently,  both  the
appeals are dismissed but in  the  circumstance  without  any  order  as  to
costs.
2014 ( April.Part ) judis.nic.in/supremecourt/filename=41463
GYAN SUDHA MISRA, PINAKI CHANDRA GHOSE
                                                            REPORTABLE

                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION

                     CIVIL APPEAL NOS. 4854-4855 OF 2014
                (Arising out of S.L.P. (C) NOs.1581-1582/2011


      J.N. Chaudhary & Ors. Etc.                        ..Appellants


                                   Versus


      State of Haryana & Ors.                     ..Respondents


                                    WITH


                     CIVIL APPEAL NOS. 4856-4857 OF 2014
                (Arising out of S.L.P. (C) NOs. 4758-59/2011)




      Mount Everest Co-operative House
      Building Society Ltd.                   ..Appellant


                                   Versus




      State of Haryana & Ors.  etc. etc.                 ..Respondents




                               J U D G M E N T




GYAN SUDHA MISRA, J.


1.          Delay in SLP (civil) 4758-59/2011 condoned.
2.          Leave granted in both sets of special leave petitions.
3.          These appeals by special leave have been preferred  against  the
judgment and order dated 27.08.2010 passed by the High Court of  Punjab  and
Haryana at Chandigarh in Letters Patent  Appeal  Nos.215  and  216  of  2007
(O&M) whereby the Division Bench  of  the  High  Court  dismissed  both  the
letters patent appeals by  a  common  judgment  and  order  which  is  under
challenge herein.
4.          The letters patent appeals which stood dismissed  arose  out  of
two writ petitions filed in the High Court before the learned  Single  Judge
bearing  writ  petition  Nos.6491/2005  and  7742/2005  which   were   filed
challenging the orders dated 13.12.2002, 05.09.2003 and  19.11.2004  in  the
High Court at Chandigarh which were the Suspension Order, Removal  Order  of
the erstwhile Committee and order of the Dy.  Registrar  who  dismissed  the
appeal  against  removal.   The  facts  stated  therein  disclosed  that  on
04.03.1994, a  co-operative  society  in  the  name  of  Mount  Everest  Co-
operative Group Housing Society was formed and    constituted    under   the
Haryana Co-operative Societies Act, 1984 wherein 288 persons became  members
of the Society upto 1995-96 and contributed a  total  sum  of  approximately
Rs.7.5 crores   towards   the   funds  of  the  Society  which  were  to  be
utilised for purchase  of  the  land.         In    the   year   1996,   the
Society    purchased  approximately 10  acres  4  kanals  14    marlas    of
land   in     Village Wazirabad    as   well   as   Hyderpur   Viran    with
  the   funds
contributed by the members of the Society for  achieving  its  objects.   At
the time of formation of the Society, a Managing  Committee  had  also  been
constituted with Mr. R.P. Gupta as Secretary but the same was  suspended  on
23.10.1996 by the then Assistant Registrar Co-operative  Societies,  Gurgaon
on the allegations of financial irregularities and a Board of  Administrator
was appointed.   However,  the  Deputy  Registrar  reinstated  the  Managing
Committee of the society on  30.08.1999.   Subsequently,  on  28.05.2000,  a
General Body Meeting of the society took place in which fresh  election  was
held and a new Managing Committee was  constituted  wherein  the  petitioner
No.1 Captain Shri A.K. Mahindra (since  resigned  during  pendency  of  this
appeal) was elected as Member of the new Managing  Committee  and  later  on
was entrusted with the work of Honorary Secretary of the  Society  in  place
of the previous Secretary Shri R.P. Gupta.
5.          It is the case of the petitioner/members  of  the  Society  that
the new Managing Committee after taking charge and upon  inspection  of  the
records of the  Society  found  that  the  earlier  Managing  Committee  had
indulged in large scale malpractices and in order to investigate  the  same,
an internal committee was constituted to go into the land records,  finances
as well as other aspects of the Society.  This internal committee  therefore
conducted an intensive enquiry and submitted report which highlighted  gross
irregularities by the previous Managing Committee in the purchase  of  land,
utilisation of members fund, expenditure on account of day to  day  expenses
and expenses incurred on land and site  development  etc.   This  audit  was
conducted for the period 1993 to 2001 when the  Managing  Committee  of  the
society stood suspended and the Board of  Administrators  was  in-charge  of
the affairs of the Society.  Finally, when the audit  report  was  submitted
in March, 2002,  the  Managing  Committee  which  had  been  constituted  on
28.05.2000 with A.K. Mahindra  as  Secretary  decided  to  lodge  an  F.I.R.
against the members of the earlier Managing Committee when  R.P.  Gupta  was
the Secretary and the F.I.R. finally was  lodged  with  the  Police  Station
DLF, Gurgaon after which investigation was conducted and arrests were  made.
 After investigation, charge  sheet  was  also  submitted  in  the  criminal
courts but as per the charge sheet, no  allegation  was  found  against  any
members of the then Managing Committee except  Mr.  R.P.  Gupta  who  was  a
member and Honorary Secretary of the Society from its  inception  until  the
new Honorary Secretary Captain Mahindra who  was  petitioner  No.1  and  has
since resigned, took over as Secretary of the Society in 2000.
6.          When the new Managing  Committee  took  over  and  Captain  A.K.
Mahindra  functioned  as  Honorary  Secretary  from  28.05.2000  along  with
another office bearer Mr. Ashok Sharma as Treasurer,  special  general  body
meeting of the society was held on  02.06.2002  in  which  the  affairs  and
conditions of the society were discussed.  In the meeting, the members  were
apprised that large scales and glaring misappropriation of funds took  place
between 1994 and 2000 and it was resolved that the only option  left  before
the Society was to sell the land at the best possible market price so as  to
refund the contributions made by the  members.   The  General  Body  of  the
Society decided to sell off the land for several  reasons  recorded  in  the
minutes which are as follows:
(Reasons for General Body to decide for auction sale of the land)


        “i)      That 10.69 acres of land bearing  Khasra  Nos.1692,  1997,
              1696, 1677, 1678 and 1679 stood registered and mutated in the
              name of the Society which were in possession of the  Society.
              It could be further noted that out of  this  land,  around  9
              acres (3.5 acres in Khasra Nos.1977, 1678 and  1679  and  5.5
              acres  in  Khasra  Nos.1692,  1696  and  1697)   were   under
              dispute/litigation in the District Court at Gurgaon  and  the
              clear and undisputed land with the society  was  around  only
              1.69 acres.


           ii)   The General Body further noted that another 4.5  acres  of
                 land marked in yellow colour bearing Khasra Nos.1677, 1678,
                 1679, 1695, 1694, 1696, 1698, 21, 20 and 27 also were under
                 dispute/litigation.  It further transpired to  the  General
                 Body of the Society that the land in Khasra Nos.1977, 1678,
                 1679 measuring around 3.5 acres were never purchased by the
                 co-operative societies and there were no dispute/litigation
                 going on with the Society as this land  was never the  land
                 of the Society.  Thus, out of the total land measuring  4.5
                 acres said to be  in  dispute  only  around  1.1  acres  in
                 different Khasra Numbers was in dispute in regard to  which
                 cases were  going  on  in  the  District  Courts,  Gurgaon.
                 However, the Society further noted that this land had  been
                 purchased by another Society namely  Saraswati  Kunj  whose
                 registration was in progress.   The  General  Body  of  the
                 Society further noted that these facts  were  available  on
                 record after checking/verifying various  records  with  the
                 revenue department with the help of  Patwari/Tehsildar  and
                 the  Advocate,  all  of  whom  met  a  number   of   times.
                 Consequently, the Society was given to understand that only
                 a few days earlier to the General Body Meeting the land  of
                 the Society had been surveyed by the  Government  alongwith
                 other vacant land with  a  view  to  acquire  it  i.e.  the
                 acquisition process had been set in motion.  It was further
                 noted by the General Body of the Society that  in  view  of
                 purchase of vacant land around Saraswati Kunj  the  Society
                 of  the  petitioners  had  practically   been   surrounded/
                 encircled”


7.          In view of the aforesaid considerations taken  note  of  in  the
General Body meeting of the Society held on 02.06.2002, it  was  decided  by
the General Body to dispose of the land of  the  Society  and  the  Honorary
Secretary of the Society Captain A.K. Mahindra and Ashok  Sharma,  Treasurer
were authorized to initiate  proceedings  for  disposal  of  the  land.   In
pursuance to the general body resolutions, a  letter  dated  02.07.2002  was
sent to the Registrar, Co-operative Societies  seeking  permission  to  sell
the land.  In the meanwhile and for the purpose of ascertaining the  correct
market rate of the land, Captain A.K. Mahindra himself  wrote  a  letter  to
the Tehsildar, Gurgaon ascertaining the correct market rate of the  land  to
be disposed of.  In response to the same, the Tehsildar, Gurgaon quoted  the
market rate to Rs.40 lakhs per acre by way of Endorsement dated  14.06.2002.
 The Honorary Secretary of the society/Captain A.K. Mahindra  then  wrote  a
letter further on  02.07.2002  to  the  Registrar,  Co-operative  Societies,
Haryana seeking permission to dispose of the land at  the  earliest  for  an
amount of Rs.4.2  crores.   The  contents  of  the  aforesaid  letter  dated
02.07.2002 written by Captain A.K. Mahindra are as follows:



            “To
                 The Asstt. Registrar,
                 Cooperative Societies
                 Gurgaon, Haryana

            Sub: Permission for disposal/sale of society land.

            Sir,

            With reference to the letter No.2298 dated 1.7.02 received  from
the office  of  the  Dy.  Registrar,  Gurgaon,  we  are  enclosing  the  u/m
documents :-

                 a) Summary of the  land  as  per  registers  and  jamabandi
                    submitted is enclosed as desired.  As per  this  summary
                    the total land with the society is 84 kanals  4  marlas,
                    and

                 b) Rate of land in the  area  where  the  society  land  is
                    situated is Rs.40 lakhs (Rs. Forty Lakhs)  per  acre  as
                    obtained from the concerned patwaris  office.   A  photo
                    copy of this letter is enclosed.  As per this the  total
                    value of land is Rs.4.20 crores (Rs. Four Crores  Twenty
                    Lakhs Only).

            Kindy grant us the necessary permission to dispose      off  the
land at the earliest and oblige.

      Thanking you,

                                                         Sd/- A.K. Mahindra,
                                    Hony. Secretary, Mt. Everest Coop. Group
                                                     Housing Societies Ltd.”

8.          However, the Registrar, Co-operative  Societies  before  whom  a
dispute had been raised regarding removal of the office bearers of  the  co-
operative societies passed a suspension order on  13.12.2002  under  Section
34 (2) of the Haryana Co-operative Societies Act, 1984, suspending  the  new
Managing Committee of the Society based on allegations of gross and  serious
irregularities  as  a  result  of  which  a  Board  of  Administrators   was
appointed.   Thereafter,  on   14.01.2003,   the   Registrar,   Co-operative
Societies granted permission to the Board of Administrators  to  dispose  of
the society land and the Deputy Registrar, Co-operative  Societies,  Gurgaon
formed a Sales Committee of 5 members  for  selling  land  of  the  Society.
While granting permission  for  sale,  respondent  No.2/The  Registrar,  Co-
operative Societies appointed the following Sales  Committee  of  5  members
comprising inter alia of the following :

                    i) Dy. Registrar, Co-operative Societies, Gurgaon,


                 (ii)  Inspector, Co-operative Societies, Gurgaon,


                 (iii) Sub-Inspector, Co-operative Societies, Gurgaon.


9.          It appears that in the meanwhile CWP No.2025 of 2003  was  filed
by Captain A.K. Mahindra and others challenging the order of  suspension  of
the new Managing Committee as well as the order granting permission to  sell
the land.  During pendency of the said writ petition,  Assistant  Registrar,
Co-operative Societies, Gurgaon  on  05.09.2003  removed  the  new  Managing
Committee under Section 34 (1) of the Haryana State  Co-operative  Societies
Act, 1984 based on the ground that  the  aforesaid  Managing  Committee  had
failed to perform its duties as provided under the Act, Rules and  Bye-Laws.
 Simultaneously and in pursuance to the orders  of  Registrar,  Co-operative
Societies dated 14.01.2003 granting permission to dispose of  the  Societies
land, a public notice for auction of the land of the Society  was  published
on 07.08.2003 indicating that the  auction  would  be  held  on  21.08.2003.
This notice was published in all  the  specified  newspapers  in  regard  to
which a decision was taken by the General  Body  itself  that  it  would  be
published in ‘The Tribune’ (English and Hindi), Amar Ujala  (Hindi),  Dainik
Bhaskar (Hindi) and Dainik Jagran (Hindi).
10.         The aforesaid notice for auction of the Societies land  prompted
the suspended Managing Committee to file an  application  in  the  Court  of
Senior  Sub-Judge  on  18.08.2003  which  was  moved  seeking  an  order  of
injunction on the Society from holding the auction on 21.08.2003.  The  Sub-
Judge’s Court entertained the application and a stay of  the  sale  of  land
was  passed  by  the  Sub  Judge.   In  view  of  the  order  of  stay,   an
advertisement was further published in  the  newspapers  on  20.08.2003  for
postponement of the proposed auction but a further  development  took  place
when the interim order of  the  Sub  Judge  granting  stay  of  auction  was
vacated as a result of which another  advertisement  was  issued  which  was
published in ‘The Tribune’ on 07.08.2003 wherein a  fresh  date  of  auction
for sale of the land was given for 28.02.2003 at  10  a.m.  at  the  Society
site.
11.         In pursuance  to  the  aforesaid  fresh  date  of  auction,  the
auction was held on 24.11.2003 whereby the land  belonging  to  the  Society
was sold to respondent No.7 for a sum of  Rs.4,94,04,125/-  as  against  the
estimated market rate of about Rs.4.2 crores.
12.         After the auction of  the  land  belonging  to  the  Society  in
favour of respondent No.7 was complete, the writ petition No.20252  of  2003
which had been filed challenging  the  suspension  of  the  members  of  the
Managing Committee wherein Captain A.K. Mahindra and Ashok Sharma  had  been
elected   as   Secretary   and    Treasurer    was    withdrawn    by    the
petitioners/Secretary and  Treasurer  therein  with  liberty  to  avail  all
existing and alternative remedies available to  them  by  filing  an  appeal
under   Section   114   of   the   Co-operative    Societies    Act.     The
petitioners/Captain A.K. Mahindra and Ashok Sharma  availed  of  the  remedy
under Section 114 by filing the appeal, which was dismissed  by  the  Deputy
Registrar on 19.11.2004, which was challenged  by  filing  a  writ  petition
No.6491 of 2005, but was dismissed by the learned single  Judge  inter  alia
holding as follows:

              i) The suspension order dated  13.12.2002  and  removal  order
                 dated 05.09.2003 of the erstwhile Committee whereby Captain
                 A.K. Mahindra and Ashok Sharma had been appointed Secretary
                 and Treasurer respectively had been held  did  not  subsist
                 because new election of the Managing Committee was held  on
                 05.12.2004 wherein the appellant No.1 Captain A.K. Mahindra
                 was once again inducted as a member who earlier was holding
                 the post of Honorary Secretary as a result of the  election
                 held  on  28.05.2000  and  the  writ  petition  challenging
                 removal of Captain A.K. Mahindra and Ashok Sharma who  were
                 removed in whose place the Board of Administrators had been
                 appointed was  dismissed  as  infructuous  as  in  view  of
                 induction  of  new  Managing  Committee,  the   orders   of
                 suspension  and  removal  of  earlier  Managing   Committee
                 challenged by the writ petition  did  not  survive  as  the
                 learned single Judge was pleased to hold that when the  new
                 Managing  Committee  was  elected,  the  dispute  regarding
                 adjudication of suspension of  the  office  bearer  of  the
                 earlier Managing Committee constituted as a result  of  the
                 election held in 2002 were no longer sustainable.


             ii) The learned single Judge inter alia further held  that  the
                 petitioner A.K. Mahindra had  no  locus  to  challenge  the
                 order of his removal passed by the Registrar,  Co-operative
                 Societies appointing Board of Administrators in  his  place
                 or the decision of the General Body for sale  of  the  land
                 belonging to the society did not survive  as  it  was  only
                 A.K. Mahindra the suspended member who had  challenged  the
                 sale and no other member  had  come  up  to  challenge  the
                 decision of the General  Body  to  sell  the  land  of  the
                 Society.

            iii) The learned single Judge  had  further  held  that  in  the
                 appeal before the Registrar against removal of the  members
                 of the Managing Committee, there was no  challenge  to  the
                 order of the Registrar giving  permission  to  sell/auction
                 was made nor the auction purchaser was impleaded as a party
                 therein and hence, the appeal suffered from  misjoinder  of
                 the necessary party and non-appealing  of  impugned  order,
                 debarred the suspended petitioners to challenge the same in
                 the writ petition.

           (iv)  The learned single Judge further took  note  of  the  fact
                 that the decision to sell the land was of the General  Body
                 Society which was taken on 02.06.2002 and the said decision
                 cannot be said to have been taken by authority  constituted
                 under the Co-operative Societies Act but was taken  by  the
                 members of the Society in a General Body Meeting which  had
                 passed a resolution to dispose of the  land  at  reasonable
                 price and authorised Ashok Kumar and A.K. Mahindra  to  act
                 in the matter and that A.K. Mahindra  assessed  the  market
                 value of the land as Rs.40 lakhs per acre on the  basis  of
                 the information obtained  from  the  concerned  Patwari  as
                 already referred to hereinbefore.


           (v)   The learned single Judge was further pleased to hold  that
                 the auction sale was conducted after due permission granted
                 by  the  Registrar  under  the  supervision  of  the  Sales
                 Committee already referred to hereinbefore and after giving
                 advertisement in three  popular  newspapers  of  Hindi  and
                 English before fixing the minimum rate  of  land  at  Rs.40
                 lakhs per acre which was the market rate at that time.


             vi) The learned single Judge also took note of  the  fact  that
                 the petitioner therein did not bring on record any document
                 to show that the rate of land was more than Rs.40 lakhs per
                 acre as the prevalent collector rate/circle  rate  of  that
                 time was Rs.12 lakhs per  acre  of  the  area  whereas  the
                 Societies land in question was sold at Rs.46.25  lakhs  per
                 acre i.e. more than the market rate fixed  at  Rs.40  lakhs
                 per acre.  The learned single Judge recorded a  categorical
                 finding that there was neither any fraud in conducting  the
                 auction sale nor was the auction sale bad or illegal in any
                 manner.   In  so  far  as  the  allocation  regarding   non
                 publication  of  the  auction  notice  in  less   expensive
                 newspaper is concerned, it was held that this decision  was
                 also taken in the  General  Body  Meeting  of  the  Society
                 itself.  However, the learned  single  Judge  enhanced  the
                 rate of land from Rs.46.25 lakhs to Rs.70  lakhs  per  acre
                 which amount had  himself  been  offered  by  Captain  A.K.
                 Mahindra who was the Honorary Secretary of the  Society  at
                 least on the date when the resolution by the  General  Body
                 was passed on 02.06.2002.  The learned single  Judge  after
                 hearing the  contesting  plea  of  the  respective  parties
                 disposed of the  writ  petition  taking  into  account  the
                 interests of the members of the Society  holding  that  the
                 amount of Rs.70 lakhs per acre was sufficient for  eligible
                 members.


           (vii)  The  learned  single  Judge  further  ordered  that   the
                 difference of the amount which  had  come  about  with  the
                 increase in the cost of the land  by  increasing  the  rate
                 from Rs.46.25 lakhs per acre to Rs.70 lakhs per acre  would
                 be paid by the respondent  No.7/auction  purchaser  to  the
                 Registrar, Co-operative Societies within 45 days  from  the
                 date of the order i.e. 24.08.2007 with interest at the rate
                 of 6% per annum on the amount awarded by him from the  date
                 of auction till the payment was actually made.


           (viii)      It was further directed by the learned single  Judge
                 that  the  amount  so  received  from  respondent  No.7/the
                 auction purchaser would be disbursed forthwith amongst  the
                 eligible members proportionately, except the tainted  ones,
                 by the Registrar himself or by any other person  authorised
                 by him in that regard and the share of the tainted  persons
                 would be kept until the decision of the cases against  them
                 were adjusted against the recovery, if any ordered  against
                 them.  It was also made clear by the learned  single  Judge
                 that the members  who  had  already  received  their  share
                 amount would only be entitled to the difference on  account
                 of increase of price and the concession given by  the  High
                 Court in the judgment.


13.         The erstwhile Secretary  of  the  Co-operative  Society  Captain
A.K. Mahindra who had been suspended by the Registrar, Co-operative  Society
along with 37 members (38 in all) filed  letters  patent  appeal  No.215  of
2007 before the Division Bench of the High Court wherein  the  auction  sale
conducted by the Board of Administrators under the supervision of the  Sales
Committee  of  5  members  which  included  Deputy  Registrar,  Co-operative
Societies,  Gurgaon,  Inspector,  Co-operative  Societies,   Gurgaon,   Sub-
Inspector, Co-operative  Societies,  Gurgaon  filed  letters  patent  appeal
before the Division Bench  of  the  High  Court  wherein  the  auction  sale
conducted by the co-operative societies in pursuance to  the  order  of  the
Registrar passed by the co-operative societies were  challenged  essentially
on the following grounds:

              i) That the advertisement for auction  of  the  land  was  not
                 published in newspapers which had a wide circulation in  an
                 area.  It was alleged that the said notice was deliberately
                 issued in a newspaper which had negligible  circulation  in
                 Delhi and Gurgaon, where most of the members of the Society
                 used to reside.


           (ii)  The land belonging to the Society was sold for a  song  to
                 the respondent No.7 though it could have fetched more  sale
                 consideration  in  case  the  auction  after   giving   due
                 advertisement, would have been conducted.


           (iii) There was no necessity of selling the land.


14.         The learned Judges of the Division Bench who heard  the  letters
patent appeals rejected all the contentions of  the  appellants  and  upheld
the order passed by the learned single Judge holding therein that  the  plea
regarding suppression of notice in  a  newspaper  lacking  wide  circulation
could not be sustained as the first advertisement regarding  auction  notice
were published in three newspapers of wide circulation and  when  the  first
auction notice was cancelled, the second  notice  was  published  announcing
the new date as the said order against the auction had been vacated and  the
said notice was published in the daily  newspaper  ‘The  Tribune’  which  is
locally the most prominent newspaper in  Punjab  and  Haryana.   Hence,  the
Division Bench was pleased to hold that the land being situated in  Haryana,
the publishing of the later advertisement in ‘The Tribune’  cannot  be  held
to cause  any  prejudice  to  the  prospective  buyers  as  alleged  by  the
appellant.
15.         The Division Bench was further pleased to  hold  that  the  plea
raised by the counsel for the appellant  that  there  was  no  necessity  of
selling the land belonging to the Society was also not worth accepting  when
a conscious and considered decision was taken by the General Body  vide  its
resolution passed on 02.06.2002, whereby a decision was taken  to  sell  the
land keeping in mind the plight of the members who were  initially  made  to
understand that in case flats were constructed  a  flat  would  cost  around
Rs.4 lakhs but would later stipulated that on completion of  the  flat,  the
same would cost Rs.17.50 lakhs approximately, if construction  commenced  on
time and were to be completed within three years, whereas  at  the  relevant
point of time, flats in other adjoining  societies  were  readily  available
for a lower cost at Rs.12 to 13 lakhs.  The  Division  Bench  therefore  was
pleased to hold that the decision in the  General  Body  Meeting  was  taken
after considering the pros and cons of the  decision  to  auction  sale  the
land.
16.         In so far as the plea of  the  appellant  emphasising  that  the
land was sold at a much cheaper rate to the respondent  No.7  and  thus  was
prejudicial to the interest of the members of the Society is  concerned,  it
recorded that the appellant Captain A.K. Mahindra who was  representing  all
the  appellants  in  LPA  No.215/2007  had  himself  written  a  letter   on
02.07.2002 while seeking permission  to  sell  the  land  to  the  Assistant
Registrar, Co-operative Societies stating that the rate of the land  in  the
area where the Society is situated is Rs.40  lakhs  per  acre,  as  obtained
from the concerned  Patwari  office.   Captain  A.K.  Mahindra  had  himself
forwarded that letter alongwith a copy  of  the  letter  received  from  the
concerned Patwari.  In that letter which has been  quoted  hereinbefore,  he
had categorically stated that the total value of the land was based  on  the
above rate which amounted to Rs.4.20 crores  for  the  entire  land  of  the
Society.  Even the minutes of the General Body  Meeting  recorded  that  the
members themselves had resolved that the land prices  in  the  area  at  the
relevant time, that is in the year 2002 had gone down.  In view of the  rate
quoted by the  appellant  himself  in  the  aforementioned  letter  and  the
decision taken by the General Body in its Meeting to sell the  land  on  the
ground that the land prices were going down, no  plea  could  be  raised  at
that stage to say that the land was sold at a  lower  price.   The  Division
Bench further took note of the fact that in any case, the rate of  land  was
enhanced from Rs.40 lakhs to Rs.70 lakhs per acre by  order  of  the  single
Judge.  Besides this, when the General Body of the Society  had  decided  to
abort the venture of the flat building due to germane factors  such  as  the
pending litigation, possibility of acquisition by the Government,  irregular
shape of the land and the surrounding land having been purchased by  another
society namely Saraswati Kunj and the falling rate of land  prices,  it  was
in the members interest to recover the  investments  made  by  them  in  the
failed  venture  as  quickly  as  possible.   The  appellant  No.1/suspended
Honorary Secretary Captain A.K. Mahindra had  made  enquiries  himself  from
the Tehsildar about the prevalent market price and the Tehsildar had  opined
that at the relevant time while the  Collector  rate  was  Rs.12  lakhs  per
acre, the market rate was about Rs.40 lakhs per acre.   In  spite  of  this,
the learned single Judge was pleased to enhance the  rate  of  the  land  by
awarding Rs.70 lakhs per acre  of  the  land  owned  and  possessed  by  the
Society.  Hence, the Division Bench  was  pleased  to  hold  that  when  the
appellant No.1 Captain A.K.  Mahindra,  the  erstwhile/  suspended  Honorary
Secretary had himself as an office bearer  sought  permission  to  sell  the
land at Rs.40 lakhs per  acre,  he  cannot  be  permitted  to  question  the
inadequacy of Rs.70 lakhs per acre which was awarded by the  learned  single
Judge. Thus, the amount which was actually paid  for  the  purchase  of  the
land on 24.11.2003 exceeded by  about  Rs.70  lakhs,  which  was  previously
estimated to be Rs.40 lacs per acre as  per  the  market  rate  i.e.  Rs.4.2
crores vide letter dated 02.07.2002  which  was  written  by  the  appellant
No.1/Captain A.K. Mahindra  on  behalf  of  Mount  Everest  Society  to  the
Registrar,  Co-operative  Society,  Haryana.  The  learned  Judges  of   the
Division Bench thus were pleased to uphold the judgment and order passed  by
the single Judge relying upon the figure suggested  by  the  appellant  No.1
himself relating to the cost of land recorded hereinbefore.    Consequently,
the Division Bench which examined  in  detail  the  price  fetched  for  the
society land, found it to be reasonable particularly in  the  light  of  the
adverse factors noticed by the  General  Body  Meeting  which  prompted  the
General Body to pass a resolution to put the  land  to  auction  sale  which
have been scrutinised meticulously and extensively by the  single  Bench  of
the High Court as also the Division Bench recorded  hereinbefore.   In  view
of the aforesaid findings  recorded  by  the  Division  Bench,  the  letters
patent  appeals  were  dismissed  by  the  High  Court  and  thus   it   was
concurrently held by the single Judge as well as  the  Division  Bench  also
that the auction sale  could  not  be  held  to  be  illegal,  arbitrary  or
suffering from the vice of surreptitious auction sale which  could  persuade
the High Court to set it aside as the High  Court  examined  in  detail  the
price  fetched  for  the  society  land  and  found  it  to  be   reasonable
particularly in the light of the adverse  factors  noticed  by  the  General
Body in the Meeting which prompted the General Body to pass a resolution  to
put the land to auction sale.
17.         Feeling aggrieved  with the judgment and  order  passed  by  the
Division Bench dismissing the two Letters  Patent  Appeals,  thus  upholding
the judgment and order of the single Judge, two appeals by  way  of  special
leave had  been  filed  by  the  petitioners/appellants  Mount  Everest  Co-
operative  House Building Society  Ltd.  and  by  10  members  of  the   Co-
operative Society out of which  the  petitioner/appellant  No.1  Capt.  A.K.
Mahindra  withdrew himself from  the    special  leave  petitions    due  to
which he now ceases to be an appellant in the appeal filed by  the  members.

18.           Learned  senior  counsels  Mr.  P.S.  Patwalia  and  Mr.  C.A.
Sundaram  representing  the appellant - members of  the  Mount  Everest  Co-
operative  Society  and   the    Mount   Everest      Co-operative   Society
respectively assailed the  judgment and order of the  Division  Bench  which
was pleased to uphold  the judgment  and order passed by  the  single  Judge
and thus  upheld the auction  sale   in  favour  of  the  auction  purchaser
respondent No.7 inter - alia  on the grounds which  substantially   are  the
same which  had  been   urged  before  the  High  Court  and  were  rejected
concurrently  by the single Judge as  also  the  Division  Bench.   However,
since  the counsel for the  parties  were  heard  at  length  assailing  the
correctness of the judgment and order passed by the High Court, it would  be
appropriate in the  interest  of  justice  and  fairness  to  the  cause  to
recapitulate  and  deal with the same.
19.          The principal ground of challenge to the auction sale thus  are
essentially two-fold.   In the first   place,  it  was  submitted  that  the
action of  respondent No.3 in suspending  the new managing committee of  the
petitioner/appellant  society  under  Section  34(2)  of  the  Haryana   Co-
operative   Societies  Act,  1984  was  arbitrary   and  illegal  where   no
proceeding  for removal  of  the  managing  committee   was  pending   under
34(1) of the aforesaid Act and the same was done with an oblique  motive  to
put the land of the Society to auction sale.  In this context, it  was  also
submitted that the action of  the  official  respondents  and  that  of  the
sales committee appointed by the official  respondents   in  conducting  the
auction sale of the land of the society   on   24.11.2003  was  sham  and  a
fraud  committed on the members  of the society and  the  public  at  large.
It was therefore further submitted that the  official  respondents  and  the
members of the sales committee had colluded  in  selling  the  land  of  the
society at a throw away price in favour of  respondent No.7 which  according
to the appellants has been established   by  the  records   of  the  auction
conducted  on 24.11.2003.  Thus, in sum  and  substance,  it  was  contended
that the auction  conducted  on  24.11.2003  was  a  pre-determined  affair,
illegal and a sham auction sale.
20.         Commenting on this part of the averment, it was  submitted  that
it is clear from all the pleadings before the High Court  raised  on  behalf
of the Society that the Society was not duly represented  for  want  of  the
office-bearers of  the  Society  and  the  entire  process  of  auction  was
collusive.  According to the counsel, the General  Body  Meeting  which  was
called by the society and the resolution which  was  passed  therein  should
not have been given effect to.  It was, therefore, urged that  the  Division
Bench of the High Court erred  in  dismissing  the  Letters  Patent  Appeals
filed by the respondents as the High Court failed  to  appreciate  that  the
action of the  respondents  from  the  time  i.e.  suspending  the  Managing
Committee was merely to grab the land of the petitioner/society.
21.         Elaborating on this aspect, it was  further  submitted  that  on
13.12.2002  Assistant  Registrar,  Co-operative   Society    suspended   the
Managing Committee when A.K. Mahindra was the Secretary  on  the  basis   of
alleged irregularities  of the  previous   Managing  Committee   under  Shri
Gupta and not on the  ground  of  mal-functioning   of  the  then   existing
Managing Committee under Capt. A.K. Mahindra.  The Committee was  thereafter
illegally removed on 5.9.2003  without even  fixing  the  date  of  hearing.
Giving the sequence of events, it was stated that in between 13.12.2002  and
5.12.2004, there was no  committee  or  effective  society   to  manage  the
affairs of  the  co-operative society  since  they  had  been  suspended  or
removed.   At this time, a Board of Administrators  was   in  control   with
Mr. Ashok Sharma as one of the key administrators  who  acted  in  collusion
with the  auction-purchaser.  It has further  been   submitted  that  during
the period  of suspension/removal of the managing committee and  appointment
of the Board of Administrators which period was  in  between  13.12.2002  to
24.11.2003, the property was sought to be brought to  sale  through  a  sham
auction in collusion with the auction-purchaser without any  notice  to  the
members of the society.   Factual details were  further  given  out  stating
that the last elected secretary of the managing committee  with  Capt.  A.K.
Mahindra as Secretary and 120 others filed a  writ  petition  on  18.12.2003
challenging the suspension of the managing committee and  the  sale  to  the
respondent No.7.   The society  itself could not file any  case since    the
 committee had been removed and  was under the  control   of  the  Board  of
Administrators  whose collusive  action  was  being  questioned.    However,
this writ petition had been withdrawn  to challenge the removal  before  the
Registrar but as the  Registrar  rejected   the  petition  challenging   the
removal, another petition was filed on 26.4.2005.  In the meantime,  a  sham
election was conducted on 5.12.2004 whereby Mr.  Ashok  Sharma  was  elected
and  this was immediately  challenged  on 6.12.2004.  The election  was  set
aside   and  once  again  a  Board  of  Administrators   was  appointed   on
26.9.2007.  Elections  were thereafter again conducted on 13.9.2010  by  the
Registrar and the present committee was elected on 13.9.2010.  It  has  been
submitted that this was the true committee representing   the  members   who
were absent and in between the  period  of  13.12.2002  and  13.9.2010,  the
managing committee became  non-existent  which  was  under  the  control  of
Mr. Ashok Sharma who became the Member of the Board of  Administrators   and
is alleged to have been controlling    even  the  Board  of  Administrators.
On  19.11.2010, when the  new Managing Committee  took  over,  a  resolution
was passed on 27.8.2010 after which  Letters  Patent  Appeals   were   filed
before the Division Bench which were  dismissed   and  the  same  are  under
challenge  in these appeals by way of special leave petitions.
22.         On the basis of the aforesaid  facts, it was contended that  the
 society  and its members  were  not  duly  represented  for  want  of   the
members of the society and no General Body Meeting was called to discuss  or
decide the nature  of the pleadings to be filed  or  the stand to  be  taken
by the members.  The members of the society were kept entirely in  the  dark
between  the  period   13.12.2002  and  13.9.2010  and  immediately  upon  a
representative  committee   being  elected,  the  society   preferred    the
Special Leave Petitions   before  this  Court   out  of  which  the  instant
appeals arise.   It was further contended  that the plea  of the  respondent
that the  majority of the members have no grievance   is  completely   wrong
inasmuch as  only 120 members  out of   288 members  had  taken  away  their
payment  and a substantial number of  those  did   it  under  protest.   The
allegation, therefore,  that the  cause of action to pursue  the  matter  do
not survive at the instance of a  few  members  is fit to be  rejected.   It
had also been reiterated that the managing  committee   of the society   was
deliberately  suspended to grab its  land.
23.         The auction-purchaser/respondent No.7  contested  the  aforesaid
plea and first of all submitted that only  38  members   before  the  single
Judge and 10 members in Letters Patent Appeal  challenged the  judgment  and
order of the High Court passed by the Division Bench and has also given  the
detailed sequence  of events under which the managing committee of  the  co-
operative society  was suspended and also the fact that  the   decision  was
taken by the Board of Administrators  and the General Body in  a  bona  fide
 manner with which  the respondent No.7 had  no  concern.   It  was  further
contended that the decision to sell the land was taken by the  General  Body
of the Society after the society  decided to  sell  the  land  and  recorded
specific reasons for this  by holding a General Body Meeting   on  2.6.2002.
At this point  of time,  Capt.  A.K.  Mahindra  was  the  Secretary  of  the
Managing Committee  who  had  challenged  the  suspension  of  the  Managing
Committee  and  the  sale before the Registrar,  had himself  taken   active
part  in the society’s  decision to  sell the land   who has now  discreetly
 withdrawn   himself from the present special leave petitions.  The  General
 Body Meeting   minutes had recorded the reasons  for the  General  Body  to
approve of the auction sale   indicating  that   it  was  agreed  that   the
society   could not develop the land  due to financial constraints   as  the
land was agricultural land for  which  license   had  been  denied,  certain
areas were under disputes/litigation, the land was  not  located   close  to
the main road  and was not contiguous   had  multiple   share  holders   and
thus  did not command  such land rates  as other  properties   in  the  area
and, therefore,  a conscious  well-deliberated decision  was  taken  by  the
General Body to sell  the  land  as  that  was  a  viable   and   beneficial
alternative  for the members  to go into.  However, the  auction  purchaser-
respondent No.7 was not in the picture at all when the decisions were  taken
by the General Body way back in 2002.
24.         Learned senior counsel for the appellants Mr.  Patwalia  however
countered this submission and assailed it by submitting that   even  if  the
decision by the General Body  was taken to dispose of the land   by  putting
it to auction  sale, it was not that the  auction could   be  held  and  the
land   could be sold at a throw away price putting the society  to  a  great
loss.  It was, therefore,  urged that the basic question would  be   whether
the auction was conducted fairly and correctly so as  to   get  the  maximum
price.  According to the learned counsel a perusal  of  the  auction  notice
and auction records would disclose that it was not done so and  the  auction
sale is a complete sham as the  price  at  which  the  land  was  sold,  was
highly inadequate and   much   below  the  price  which  it  ought  to  have
fetched.
25.         On a scrutiny of the sequence of events  and  the  plea  of  the
contesting parties  on the pivotal  point    as  to  whether   the  decision
taken to auction sale the land  was bona fide   or  malafide,  tainted  with
dishonest  motive  and whether the  suspension  of  the  Managing  Committee
and appointing the  Board of Administrators  was  correct  or  not,  it  can
clearly  be  noticed  that  when the managing committee  under Mr. Gupta  as
Secretary was suspended, a new   managing  committee  after  fresh  election
took over,  when on  5.8.2001 Capt. A.K. Mahindra  became  Secretary of  the
 Managing Committee.  It was under his secretaryship  that  a  General  Body
Meeting was convened and a resolution was passed  by  the  General  Body  to
auction sale  the land recording specific  reasons  in the  Minutes  of  the
General Body Meeting whereby  the  Honorary  Secretary/Capt.  A.K.  Mahindra
brought out the options to the notice of  the  General  Body.   One  of  the
options was to construct flats  on  the  land  for  which  tender  had  been
floated and it was noted that  out of the two parties who responded  to  the
tenders, one namely M/s Antriksh Engineers and  Construction  &  Corporation
had shown interest.  Their main terms were as follows:


      (a)  that  they  will  invest  all  money  required  to  obtain   CLU,
      development charges etc. i.e. they will invest right  upto  the  stage
      where construction can begin.  This will entail an expenditure of Rs.8
      crores approximately.


      (b)  that they will refund the deposit of a limited number of  members
      after CLU permission is received.


      I  that in lieu of the money invested they will be given  50%  of  FAR
      and;


             iv) construction rate would  be  Rs.850/-  sq.  feet  which  is
                 deductible.


      It was given out for information of the  members  that  the  advantage
      would be that the Society would be able to move forward  in  achieving
      its aim and that limited number of members desirous of leaving Society
      will get their money back.   In  so  far  as  the  disadvantages  were
      concerned, it was noted that it will take around 6 months to  get  CLU
      permission by which time Section 4 notice under the  Land  Acquisition
      Act may be issued for  acquisition  of  the  land  which  the  society
      possessed.  It was given out that a minimum period of   3  years  will
      take before the construction was announced and before completion  goes
      smoothly.  In case, the project was undertaken,  1600  sq.  feet  flat
      would cost Rs.13.60 lakhs approximately, and assuming a member of  the
      Society had paid Rs.4 lakhs the flat to be constructed would cost  him
      Rs.17.50 lakhs.  It was therefore deliberated  that  the  flats  at  a
      lower rate than Rs.17.50 lakhs were readily available  in  Gurgaon  in
      Jal Vayu Vihar and Rail Apartments at Rs.12 to 13 Lakhs.


      The Society therefore gave the second option to the General  Body  and
      the second option was sale of the land which were in possession of the
      society free from litigation.  The Society noted that the land  prices
      had gone down at the relevant time which was lower than  the  purchase
      price in the last few years when the Society had purchased the land at
      Rs.7.5 crores.  Thus, it was noted down  by  the  Society  before  the
      General Body that if the land belonging to the Society  were  to  sell
      the land it will be unable  to  recover  the  full  amount  which  the
      society has earlier invested  in  purchasing  the  land.   However,  a
      comparative assessment of the objectives were also taken  note  of  by
      the society which were as follows:


              v) Will avert the danger of the land belonging to the  society
                 being acquired.


             vi)  Will  avert  all  the  cost  and  uncertainties   of   the
                 litigations being faced by the Society.


            vii) Members of the Society will get back around  70%  of  their
                 investments.


           viii) Will  pave  the  way  to  recover  the  balance  amount  of
                 investments by members.


      Thus, on a comparative assessments of the land being retained  by  the
      Society and in case it was  disposed  of,  the  General  Body  of  the
      Society resolved on 02.06.2002 after taking a  conscious  decision  to
      dispose of the land of the Society.”


26.         It was in view of this decision that  follow  up  actions   were
taken by  the Board of Administrators under the Sales  Committee    inviting
proposals  for the sale of the land as the Managing Committee under  Captain
Mahindra and Treasurer Ashok Sharma was under suspension due to the  alleged
illegalities and irregularities.  The  learned  single  Judge  as  also  the
Division Bench  of  the High Court   has scrutinized  and  taken   note   of
the overwhelming  circumstance  which weighed with the High Court.   It  was
considered by the High Court  which took note  of  the  fact  that  although
10.69 acres of land was claimed by the society, 9 acres  i.e. 3.5  acres  in
Khasra Nos. 1977, 1678 and 1679 as also 5.5 acres in Khasra Nos. 1692,  1696
and 1697 were  in dispute/litigation in the District  Court,  Gurgaon.   The
clear land without any  dispute with  the  society   was  only  around  1.69
acres.  The records further  indicated  that  3.5  acres  of  land   bearing
Khasra Nos.  1977, 1678 and 1679 was never  purchased by the society as  per
the then Secretary Mr. R.P. Gupta.  The learned single Judge has also  taken
note of the fact that this was under  litigation  as  it  was  purchased  by
another society –Saraswati Kunj whose registration was in  progress.   Thus,
if 3.5 acres were  to be deducted   out of 4.5  acres,  only  1.1  acre  was
left to the society.  The learned  single  Judge  further   noted  that  the
land in question  had been surveyed by  the  Government   along  with  other
vacant land with a view to clear it    and  the  acquisition   process   had
been set in motion.  The land belonging to the society had been   encircled/
surrounded  by another  society   namely  Saraswati  Kunj.   Therefore,  the
future  course of action left  to  the  society   which  has  been  recorded
hereinbefore in detail in view of the considerations  made  by  the  General
Body, was to dispose of the land of the society.
27.         Insofar  as the dispute regarding  suspension of   the  Managing
Committee  under  Captain  A.K.   Mahindra   in   view    of   the   alleged
irregularities  of the previous  managing committee  is  concerned,  it  had
started only on  13.12.2002  and all the disputes  in   regard   to  removal
and induction of the society  under  Capt.  A.K.  Mahindra  admittedly  took
place between  13.12.2002 and 24.11.2003.   But it is an equally  undisputed
factual  position  that the resolution was passed by  the  General  Body  in
its Meeting  for  sale of the land on 2.6.2002 when the  managing  committee
constituted   on 5.8.2001  under Capt. A.K. Mahindra was duly in  place  and
no member of  the  society  had  raised  any  grievance   against  the  said
decision that it was  erroneous  or tainted in any manner  and the   society
 was duly represented  by the Secretary and all  members  of   the  society.
The case of the  managing committee  and  its  members  that  the  Assistant
Registrar illegally  suspended  the  managing  committee  under  Capt.  A.K.
Mahindra  based on the alleged irregularities   of  the  previous   managing
committee under  Mr. Gupta, first of  all  took  place  on  13.12.2002  from
which  it is clear  that  when the General Body Meeting  was  conducted  and
resolution  was  passed  on   2.6.2002,  the  Secretary  of   the   Managing
Committee  Capt. A.K. Mahindra  was duly and legally in  place as  Secretary
 and was removed by the Registrar  of  Society only  at  a  later  stage  on
05.09.2003 after which  the Board of Administrators  was  appointed  by  the
Registrar and a Sales Committee was also set up under whose supervision  the
auction  sale was  decided  to  be  held  under  supervision  of  the  Sales
Committee.  It may further be noted that  the  proposed  auction   was  also
challenged as an application  for   injunction  restraining    the   auction
sale  was filed  before the District  Court  where an  order  of  injunction
restraining the auction sale was also  granted by  the  District  Court  but
the said injunction was later vacated against which no appeal was  preferred
by any member of the society.   It  is  no  doubt  true  and   it  has  been
contended that as no Managing Committee was in existence  at that  point  of
time,  no  appeal  could  be  preferred  against  the  order   vacating  the
injunction.  However, this contention is clearly without  substance  for  if
the members in their individual capacity could assail  the auction  sale  by
filing  a separate  writ petition, it cannot  be  accepted  that  they  were
precluded in any manner from challenging the auction  sale   in  case   they
were aggrieved  and the subsequent  challenge  after  seven  years  in  2010
clearly appears to be  an after thought  at  the  instance  of  a  miniscule
number of members  who decided to assail  the  auction  sale  clearly  as  a
matter of gamble  -
28.         As already noted, the resolution by  the  General  Body  of  the
Society to auction sale the land was taken way back  on  2.6.2002  vide  the
resolution passed in  the General   Body when  there  was  dispute  existing
regarding the functioning  of the Managing Committee and it  is  only  after
more than one year  that the  Secretary  –  Mahindra  was  removed   by  the
Registrar, Co-operative Societies  and since he was  removed, he  challenged
his removal as also the  decision of the General Body to auction  sale   the
land which resolution during his tenure as Secretary was  passed.   In  fact
as long as he  was the Secretary  he had not merely  approved  the  decision
of the General Body to auction sale, but also the  existing market price  of
the land  and only when he was  removed  from  the  post  of  Secretary,  he
started questioning the auction sale  held  under  the  supervision  of  the
Board of Administrators as also the decision to auction  sale  of  the  land
conveniently ignoring that the same had been approved by  the  General  Body
Resolution during  his  tenure  as  Secretary  when  there  was  no  dispute
regarding the Society’s functioning.
29.         It  may  further  be  noted   that   the  then  Secretary  Capt.
Mahindra although  had   challenged   his  removal    as  Secretary  of  the
Society, he never thought  it  appropriate  to  file any appeal against  the
order vacating  the order of  injunction  against   auction  sale  which  he
could have done as the ex-secretary if he  was  genuinely  concerned.    The
matter regarding the dispute challenging  the auction sale  had  been  filed
in  a  court  of  competent  jurisdiction   where  initially   an  order  of
injunction was also passed but the same   was finally vacated against  which
no appeal was preferred   either  by  any  member  of  the  society  or  the
Secretary.  The  order  of  injunction  against  auction  sale  was  finally
vacated but no member was conscious  or vigilant  to  challenge   the  same.
On the contrary, large number of  members  gradually   withdrew  the  amount
and walked out of the society.  It is clear that for the first time  in  the
year 2010  when a new managing committee was elected  on  13.9.2010  that  a
decision was taken  to  challenge  the  auction  sale  by  which  time   the
existence of the society withered  away when the  majority  of  the  members
out of 288 left and only 38 members remained clearly implying that  for  all
practical purposes the Society ceased  to retain its  legal  entity  as  the
land of the society for which contribution had been made  was   by  all  the
288 members and not merely 38 members.  Even  out  of   this    38  members,
only 10 members preferred  Letters  Patent  Appeal  before  the  High  Court
although  the General Body resolution was passed by the majority and  cannot
be allowed to be over ruled by 10 members only.
30.         Much emphasis has been laid  on  the valuation of the  land   as
it has been alleged that the land was auctioned/sold at a much  lower  price
than  was capable of fetching which remains unsubstantiated  in  absence  of
any evidence in this regard  as  to  what  were  the  market  price  of  the
undeveloped land in the surrounding areas.  On the  contrary,  it  could  be
noted that the circle rate of the land at the relevant time was  Rs.12  lacs
per acre and the market rate was Rs.40 lacs per acre and as per the  auction
held, the price fetched in the auction ultimately worked out to  Rs.46  lacs
per acre.  The appellants had not furnished any material  before  any  court
as to what was the market price of the undeveloped land  in  the  year  2003
when the auction sale was held in pursuance to the General  Body  Resolution
of the Co-operative Society.  In any case, this question at  this  stage  is
not of much relevance when the High Court has increased the   price  of  the
land at Rs.70 lakhs per acre  and members of  the  society  have  been  held
entitled to refund of their contribution amount along with 6 %  interest  in
view of which undervaluation of the cost of the  land  no  longer  subsists.
It has no where been urged that at  the relevant point of time in  the  year
2003 when the land was auctioned/sold, its  valuation  was  much  more  than
Rs.70 lakhs  per acre so as to treat it  prejudicial   and  detrimental   to
the interest  of the  members  of  the   society  who  had  contributed  for
purchase of the land.
31.         Thus, if  the members  of the Society  by virtue of   a  General
Body  resolution had decided to auction sale the land  during the tenure  of
a duly elected  Secretary of the Society A.K. Mahindra  and  for  more  than
one year no member of the society  had  any reason to  challenge   the  same
after which the Board of Administrator was appointed and the  price  of  the
land  on the date of auction could not be more than Rs.70  lakhs  per  acre,
it would  be unfair and unjust to interfere with the auction sale  after  11
years of its holding on the plea  that the  price  fetched  in  the  auction
suffers from  undervaluation as  the  same  cannot  be   compared  with  the
present day valuation which obviously must have grown   over  the  years  as
compared to the year 2003 when the auction sale was held.  In this  context,
it may also be noted that the Secretary  Capt.  Mahindra   as  also  Patwari
had also given  out in writing  and is on record which  indicates  that  the
value of the land  at the relevant time which was not a  developed  land  at
the relevant time when the land was put to auction sale was  not  more  than
Rs. 40,000 per acre which  cannot be doubted in  absence   of  any  material
to the contrary specially when the circle rate of the land  was  Rs.12  lacs
per acre only and  the  land  was  auction  sold  at  Rs.46  lacs  per  acre
approximately in the year 2003.  In any case, the  price  of  the  land  has
already been increased to Rs.70 lakhs per acre by the High   Court  and  has
been ordered to be paid alongwith 6 % interest and thus the Society has  not
been put to monetary loss on account of the sale conducted in  pursuance  to
the resolution of the General Body which was passed during the tenure  of  a
duly constituted Managing Committee under Captain Mahindra.  It  is  further
clear that only a handful of members of the co-operative   society  who  are
now only 10  out  of  288  and  have  not  withdrawn  from  the  society  by
withdrawing  their amount, expects  that  all  the  following   aspects  and
circumstance  of the case should be brushed aside  which are as follows :

              i) The fact  that  the  General  Body  Meeting  was  held   on
                 2.6.2002 on which date there was no dispute regarding   the
                 functioning of the managing committee;

(ii)  Resolution of the  General Body Meeting  was  passed   unanimously  on
2.6.2002 approving the decision to auction sale the land  when  the  Society
was functioning under a duly constituted  Managing  Committee  and  had  not
been suspended.  The suspension of the Secretary of  the  Society  was  much
later after more than a year in 2003 and during this period  the  resolution
of the General Body was never challenged by any member.

(iii ) The constitution of the Board of  Administrators  should  be   struck
down as invalid  although the members of the Co-operative Society had  never
challenged the constitution of the Board of Administrators;

             iv) The Sales/Supervision Committee under whom the auction sale
                 was held should be treated as a defunct body;

              v) The valuation of the land in the year 2003 which was  Rs.12
                 lacs per acre as per circle rate and Rs.40 lacs market rate
                 should be disbelieved in  spite  of  any  evidence  to  the
                 contrary which in any case has been  increased  to   almost
                 the double  by the High Court and has awarded 6 %  interest
                 also which clearly takes care of the price  factor  as  the
                 price of the undeveloped land could not have been more than
                 Rs.70 lacs per acre at the relevant time in the  year  2003
                 when the auction sale had been held;

             vi) All activities  in regard to the  conduct  of  the  auction
                 sale should be  treated as  bogus  and  sham  although  the
                 District  Court  had  vacated  the  order   of   injunction
                 restraining the auction sale against which  no  appeal  was
                 filed;

            vii) Only 10 members   out  of  288  are  now  aggrieved   which
                 renders the co-operative society into  a  non-existent  co-
                 operative society as even the rest 28 members out of 38 who
                 had  filed  the  writ  petition  in  the  High  Court  have
                 withdrawn from the litigation.

32.         From the background, facts and circumstance of  the  matter,  it
is further clear  that the members of the co-operative society  had  clearly
opted  a wrong forum  by filing  a writ petition in the High  Court  for  if
they expected the court to appreciate evidence and record a finding  on  the
aforesaid disputes for setting aside the auction sale, it is  obvious   that
the petitioners   should  have  approached  the  civil  court  of  competent
jurisdiction where it would have had  the  opportunity  to  adduce  evidence
and prove all the allegations of  under  valuation  and  the  alleged  fraud
challenging the auction sale.  In fact,  the writ petition for assailing   a
factual  dispute ought not to  have  been  entertained  by  the  High  Court
under its writ jurisdiction but in the interest of justice and  fairness  as
also equity and good conscience,  the  High  Court  entertained   a  dispute
which purely was of a civil nature  since  all contentions  which have  been
raised would have required appreciation of evidence.  Yet the High Court  to
a great extent has taken care to scrutinize all aspects  of  the  matter  in
regard to the writ petition filed by the co-operative  society  members  who
sought  to assail  the auction sale  clearly alleging disputed questions  of
fact alleging fraud in conducting auction sale  as  also  valuation  of  the
land in question which  required  adducing  of evidence and the  same  could
not have been entertained  by the High Court  under  Articles  226  and  227
of the Constitution  except  to  the  extent  of  considering  whether   the
order passed by  the  Registrar,  Co-operative   Societies   rejecting   the
challenge  of removal of the managing  committee  was  sustainable  or  not.
Yet the High Court has entered into all aspects and has then  reached  to  a
conclusion considering entire conspectus of the matter  which  in  our  view
cannot be held to be arbitrary, illegal or unjust in any manner.
33.         There  is yet another  feature of the matter which emerges  from
the fact that when the removal  of Capt. A.K. Mahindra  as  a  Secretary  of
the society  has been set aside, then all activities  including  passing  of
the General Body resolution in the meeting that were  conducted  during  his
tenure as Secretary of the Managing Committee  cannot be held to be  illegal
in any manner.  Thus when  the General Body resolution  was  passed   during
the  tenure      of a validly elected managing committee  under  Capt.  A.K.
Mahindra as the Secretary and the resolution to auction sale the   land  was
passed during his secretaryship whereby the value  of  the  land   was  also
assessed  and approved by Capt. A.K. Mahindra himself and no allegation  was
levelled by any member against Capt. A.K. Mahindra as all  allegations  were
confined to Ashok Sharma, then the resolution of the General Body  obviously
could not have been faulted with specially  when  no  appeal   against   the
order of the Civil Court vacating   the  order  of  injunction  against  the
auction  sale  was  filed  by  any  member  of  the  society  specially  the
appellants herein.  The appellant-society and  a  handful  of   members  now
restricted to 10,  have levelled allegations  but mere allegation cannot  be
treated as a proof and if the  members were in a   position  to  assail  the
same  which clearly would have required strict  proof  by way of   evidence,
they ought to have gone in for a civil suit  and the writ  jurisdiction  was
clearly not the appropriate remedy  to  establish  and  prove  questions  of
fact.   Yet  when  the  single  Judge  as  also  the  Division  Bench   have
meticulously examined all aspect of the matter  discussed  hereinbefore  and
the same does not indicate any  perversity  in  the  conclusions  drawn,  it
would be unfair and unjust to interfere with the same by  indulging  into  a
roving enquiry merely accepting the contentions of some of  the  members  of
the  Society  which  are  clearly  based  on  speculation,  conjecture   and
apprehension.  The Courts therefore in a circumstance of this nature  cannot
be expected to decide such an issue on suspicion  hunch  or  even  intuition
which clearly would be abstract in nature and has no place  in  the  eye  of
law even before a court of fact and much less  before  a  court  under  writ
jurisdiction.
34.         The cumulative effect of the entire analysis based on the  facts
and circumstance in the light of  the reasonings   assigned  by  the  Single
Bench of the High  Court as also the Division Bench, it would  not  be  just
and proper  to interfere  with the   judgments  and  orders  passed  by  the
single Judge  as  also  the  Division  Bench  of  the  High  Court   holding
concurrently  that  the  auction  sale  which  was  in  pursuance    to  the
resolution passed by the  General Body of  the  Co-operative  Society  based
on the price prevalent on the date of auction sale could be faulted  on  the
ground  of  allegations  leveled  on  the   basis    of    assumption    and
speculation  of 10 members of the society who  had   assailed  the  same  by
invoking  writ jurisdiction.
35.         At this juncture, it would be appropriate  to  observe  that  in
judging  the functioning  of a co-operative society  or any other  statutory
body where the democratic  process  of election  is adopted in pursuance  to
the Rule  and a  collective decision  is taken  by majority  of the  members
of the entire  body expressed  in  terms  of  a  resolution  passed  by  the
General Body, then the plea that the same should be ignored  and  bye-passed
even if the same  has  been   challenged   by  a   handful  of   members  on
speculative allegation and assumption contrary to the  reasons  recorded  in
the  Minutes Books on the plea of mala fide, without any evidence, would  be
illegal and arbitrary to  accept being  contrary  to  the  rule  unless  the
alleged malicious action is  writ large  on  the  alleged  decision  and  is
challenged  by majority of  the  members.    If  a  decision  is  taken   by
majority of the members of a Co-operative Society or any other body under  a
statute in terms of the Rule, it cannot be over-ruled  by  minority  on  the
ground of  mala fide or fraud unless it has passed through  a  strict  proof
of evidence.  It is a well known dictum that  mala fide is  always  easy  to
allege but difficult to prove as the same  cannot be held as proved  relying
on assumption, speculation and suspicion.
36.         In  the instant  matter existing 10 members of the society  have
practically reduced the Co-operative Society to  a defunct  society  as  all
members except 10 out of 278 have finally  withdrawn.   Hence,  the  auction
sale  at their  instance, although  the said auction sale  had taken   place
in view of the majority support of the General  Body  resolution  which  was
conducted under the supervision of the Board of Administrators appointed  by
the Registrar, Co-operative Society and the Sales Committee is difficult  to
scrap it as illegal in spite of the overwhelming  material  relied  upon  by
the High Court which has upheld the auction sale.  Thus  in a  matter  where
the decision has been  taken collectively  by the  General  Body   reflected
in the form  of a  resolution   passed by the  General  Body,  it  would  be
unjust and inappropriate  to nurture a lurking  doubt  and  keep  suspecting
the decision by entertaining   the  version  of  a  handful   who  might  be
disgruntled  or might be  genuine  but  would be difficult to be gauged   by
any court  so as to  over-rule  the  General  Body  resolution   and  accept
the view of the   minority  based  on  no  evidence  except  assumption  and
speculation.  If the  instant matter is viewed meticulously, it  is  clearly
obvious   that   the  appellants  have   expected   the   court   of    writ
jurisdiction to enter into  the correctness  and  validity  of  the  auction
sale   essentially  by  expecting  the   Court  to  draw  inference  without
evidence  that the auction sale was not bona fide as it did not  fetch   the
 desired value  of the land contrary to the materials available  on  record.
Plethora of circumstances have been related to establish   the   same  which
clearly are in the realm of  conjecture  and  speculation,  yet  the  Single
Judge and the Division Bench  have both   scrutinized  and  considered   the
same and have recorded a finding against the   appellants  which  cannot  be
held   to  suffering  from   perversity  being  contrary  to  the   existing
materials before  the  Court  which  have  been  relied  upon.   Thus,   the
validity and correctness of the General Body  resolution in view   of  which
the land was put to  auction  sale  cannot  be   allowed  to    be  assailed
specially when the price/alleged under valuation of the land in the  auction
sale no longer survives as the High  Court  has allowed  the  value  of  the
land  to be increased by increasing  it from Rs. 40  lakhs  to  Rs.70  lakhs
per acre which  has been ordered to be paid  along with 6 %  interest.   The
appellants have not furnished  any material as noted by the High Court  that
the cost of the land in the year of the date of auction which  is  2003  was
more than Rs.70 lakhs per acre so as to  offer a cause  to  interfere   even
if it were  to be interfered in the interest of  equity,  justice  and  fair
play specially when the circle rate of the land in the year  2003  when  the
auction was held was Rs.12 lacs per acre only.
37.         Hence, the endeavour of the appellants  that  the  auction  sale
should be set aside and the land  be   revived  to  the  society  cannot  be
entertained in absence   of  proof of mala fide  contrary  to  the  existing
materials on record on the basis  of speculation, assumption  and  inference
urged by the appellants.
38.         Assuming  for a while although not conceding that the land  were
to be reverted  to the  co-operative  society  for any reason whatsoever  at
this stage after 11 years of the sale during  which  the  appellant  Society
has practically ceased to exist where all members except ten out of 288  are
left, it is obvious  that the  land  cannot  be  reverted  to  the  original
members who have taken their refund.  In that event, the appellant  –society
through a handful of members numbering ten is bound to  indulge  in  trading
of the land by inducting new members quoting new  rates  at  their  instance
clearly sacrificing  the very spirit   of  a  co-operative  society  as  the
land cannot be marketed even by the defunct Co-operative Society at the  old
rate which land had been purchased out  of  the  contribution  made  by  the
erstwhile 288 members out of which only 10 are now left into  the  fray  who
had never even objected to the General Body  Resolution  approving  sale  of
the land nor challenged the auction sale in the year 2003 when  the  auction
was held.
39.         We, thus  find  no  illegality  or  infirmity  in  the  impugned
judgments and orders passed by the single Bench as also the  Division  Bench
concurrently refusing to set aside the auction sale held  11  years  ago  in
the  year  2003  at  the  instance  of  a  Co-operative  Society  which  has
practically been rendered defunct and thus ceased to exist  apart  from  the
other  weighty  reasons  discussed  hereinbefore.   Consequently,  both  the
appeals are dismissed but in  the  circumstance  without  any  order  as  to
costs.

                                                            ………………………………….J.
                                                          (Gyan Sudha Misra)


                                                            ………………………………….J.
                                                      (Pinaki Chandra Ghose)
New Delhi;
April 24, 2014
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