Holding

The Supreme Court held that the deemed disqualification under Rule 25(2) must be examined and that where a statutory remedy is available, it should be availed before a writ petition is entertained, leading to remand of the case to the High Court.

Summary

The appellant Hindustan Co‑operative Housing Society rejected the transfer of membership from its former member Anoop Singh to his daughter Jasjit Kaur, citing the member's failure to furnish a required affidavit. Jasjit Kaur filed a writ petition in the Delhi High Court seeking allotment of a plot or refund of monies paid. The High Court allowed the writ, directing the Registrar of Co‑operative Societies to allot the plot, without examining the effect of sub‑rule (2) of Rule 25 of the Delhi Co‑operative Societies Rules, 1973, which deems a member disqualified upon certain conditions. The Society appealed to the Supreme Court, arguing that the High Court ignored the deemed‑disqualification provision and that a statutory remedy under the Delhi Co‑operative Societies Act, 1972 was available and should have been exhausted. The Supreme Court held that the deemed‑disqualification under Rule 25(2) is a crucial legal fiction that must be considered, and where a statutory remedy exists, it must be pursued before invoking the writ jurisdiction. Consequently, the Court allowed the appeal and remitted the matter to the High Court for fresh consideration in light of the applicable rule. No order as to costs was made.

Issues considered

Whether sub‑rule (2) of Rule 25 of the Delhi Co‑operative Societies Rules, 1973, which creates a deemed disqualification of membership, must be examined in the writ petition.
Whether the existence of a statutory remedy under the Delhi Co‑operative Societies Act, 1972 bars the maintainability of the writ petition.
Whether the High Court erred in directing allotment of the plot without considering the deemed disqualification and the alternative statutory remedy.

Legislation cited

Delhi Co-operative Societies Act, 1972

Subjects

Co-operative societiesMembership disqualificationDeemed provisionStatutory remedyWrit petitionArticle 226Delhi Co-operative Societies RulesTransfer of membershipAlternative remedyHigh Court remand

Judgment

[2009] 2 S.C.R. 331

HINDUSTAN COOP. HOUSING SOCIETY LTD. A
... v.
REGISTRAR, CO-OPERATIVE SOCIETIES AND ANR.
Civil Appeal No. 957 of 2009
FEBRUARY 12, 2009
B
(DR. ARIJIT PASAYAT AND ASOK KUMAR GANGl)LY,
JJ.)
)
belhi Co-operative Societies Rules, 1973 :
r. 25(2) - Disqualification of membership of a Co- c
operative Housing Society - Writ petition before High Court -
Held: Matter remitted to High Court as it has neither considered
the effect of sub-rule (2) of r 25 nor that normally when· an
alternative remedy is available, the same should be availed
- Constitution of India, 1950 - Article 226 - Writ Petition - D
Maintainability of, when alternative remedy is available.
The father of respondent No.2 was a member of the
appellant-Group Housing Society. On 5.9.1962 he wrote
to the appellant-Society to refund his membership amount
as also the amount which he had deposited towards the E
cost of the plot, as he had already purchased another plot
in the city. However, on 5.9.1972 he filed an application
for transfer of his membership in favour of his daughter,
I
respondent No.2. After some correspondence between
the father of respondent No.2 for-transfer and the appellant F
Society declining to effect the transfer, the former
tendered his resignation. Thereafter, respondent No.2 filed
a writ petition before the High Court, which held that the
appellant Society having accepted the transfer,
respondent No.2 was entitled to allotment of plot and G
directed respondent No.1-Registrar, Co-operative
Societies to allot her the plot.
In the appeal filed by the Co-operative Housing

331 H
332 SUPREME COURT REPORTS [2009] 2 S.C.R.

A Society, it was contended for the appellant that the High
Court lost sight of r.25 of the Delhi Co-operative Societies
Rules, 1973, and respondent No.2, without availing the
statutory remedies available under the Delhi Co-operative
Societies Act, 1972 and the Rules, could not file the writ
B petition.
Allowing the appeal and remitting the matter to the
High Court, the Court
HELD: 1. For the purpose of the instant case Sub-
C rule (2) of Rule 25 of the Delhi Co-operative Societies
Rules, 1973 is of paramount importance. There is a
deemed disqualification. The effect of it has not been I
~
examined by the High Court. (Para - 8) [ 339-C]
State of Travancore Cochin· v. Shanmugha Vilas
D Cashewnut Factory AIR (1953) SC 333; American Home
Products Corpn. v. Mac Laboratories (P) Ltd. 1986 (1) SCC
465 and Parayankandiya/ Eravath Kanapravan Kalliani Amma
v. K. Devi (1996) 4 SCC 76 - referred to.
Levy, Re, exp Walton by James 1881 (17) L.J. Ch.D
E 746; Hill v. East and West India Dock Co. 1884 (9) AC 448;
East End Dwellings Co. Ltd. v. Finsbury Borough Council 1951
(2) All ER 587 (HL); St. Aubyn (L.M.) v. Attorney-General (No.
2) 1951 (2) All ER 473, All ER p.498 F-G by Lord Radcliffe;
Hunter Douglas Australia Pty. v. Perma Blinds 1970 (44) Aust
F LJ 257 by Windener, J.; R. v. Norfolk County Court 1891 (60)
LJ QB 379 by Cave, J. ; Ferguson vs. McMillan 1954 SL T
109; St. Leon Village Consolidated School Distt. v. Ronceray
1960 ·(23) DLR (2d) 32; Barclays Bank v. /RC by Viscount
Simonds 1961 AC 509 (HL); R v. Brixton Prison (Governor),
G exp Sob/en 1962 (3) All ER 641, ..All ER p.669 C - referred to.
2. Normally when a statutory remedy is available, the
same should be availed. In the instant case~ that aspect
has not been examined by the High Court. The writ petition
needs to be decided by the High Court afresh keeping in
H
HINDUSTAN CO,. HOUSING SOCIETY V. 333
REGR., CO-OP. SOCIETIES AND ANR.
....
.,,. view the applicable legal provision. Counter and rejoinder A
'"'
affidavits would be filed as indicated in the judgment. The
High Court would explore the possibility of disposing of
the writ petition expeditiously. Till then, no third party
rights in respect of the plot which is stated to have been
allotted to respondent No.2 shall be created by the 8
appellant. (Para 15) [341-G, H; 342-A, B]
Case Law Reference
J
1881 (17) LJ. Ch.D 746 referred to para 9
1884 (9) AC 448 referred to para 9 c
j AIR (1953) SC 333 referred to para 9
1986 (1) sec 465 referred to para 9

al
(1996) 4 sec 76 referred to para 9 D
~

1951 (2) All ER 587 (HL) referred to para 9
1951 (2) All ER 473 referred to para 10
1970 (44) Aust LJ 257 referred to para 11
E
~ 1891 (60) LJ QB 379 referred to para 12

,,. 1954 SLT 109 referred to para 12
-+
1960 (23) DLR (2d) 32 referred to para 12
1961 AC 509 (HL) referred to para 13 F

1962 (3) All ER 641=
All ER p.669 C referred to para 14
CIVIL APPELLATE JURISDICTION Civil Appeal No. G
·- 957 of 2009
From the final Judgement and Order dated 16.2.2006 and
19.1.2007 of the High Court of Delhi at New Delhi in C.W.P. No.
686of1992 and Review Petition No. 268 of 2006 respectively.
H
334 SUPREME COURT REPpRTS [2009] 2 S.C.R.

,,;
A K.T.S, Tulsi, R.K. Gupta, R.C. Kaushik, Raj Kamal, Maheen ,;.- ~-
Pradhan and TS. Duggal, for the Appellant.
A Sharan, ASG., B.A. ,Khan, Rakesh Munjal, Rajiv Dutta,
Syed Shahid Hussain Rizvi, Saif Mehmood, H.P. Singh, Hina
Rizvi, Shashi Kiran, Asha G. Nair, Anil Katiyar and D.S. Mehra,
8
with them for the Respondent.

The Judgement of the Court was delivered by

DR. ARIJIT PASAYAT, J.
c 1. Leave granted.

2. Challenge in this appeal is to the judgment of Delhi High '
Court in Writ Petition No.686/1992 and Review Petition No.268/
2006 in the aforesaid writ petition.
D 3. Background facts in a nutshell are as follows:
On 5.9.1962 Anoop Singh who as a member wrote to
appellant-Society asking for refund of monies (Rs.3110/-
towards membership and Rs.15,000/- each for plot in appellant's
E colony). The reason stated was that as the membership process
with appellant was getting delayed and he has purchased a plot
in Green Park and as per Govt. Policy there are no chances of
+ .....
getting more than one plot in Delhi.

F On 9.5.1972 late Anoop Singh filed application for transfer
·.'of his membership in favor of his daughter, the respondent no.2.

On 18.11.1973, by a letter the appellant-society informed
Anoop Singh that the Managing Committee by resolution dated
05.09.1973 allowed the transfer and asked for share certificate
G and other documents to enable transfer.

On 12.10.1978, appellant-society requested Anoop Singh
to file an affidavit which was questioned by respondent no.2 by
letter dated 27.10.1978.
H
HINDUSTAN CO. HOUSING SOCIETY V. REGR., 335
CO-OP. SOCIETIES AND ANR. [DR. ARIJIT PASAYAT J.]

- ~ On 26.3.1979 Anoop Singh did not file the requisite A
affidavit and Administrator of appellant-society by letter informed
that the transfer could not be confirmed unless affidavit is filed.
On 14.4.1979 Anoop Singh replied stating that it is not
possible to file the affidavit as he does not know full or part of
lease hold or freehold of the property. B

On 29.5.1979 Administrator informed Anoop Singh of his
inability to transfer the membership as the affidavit was not filed
and asked to withdraw the deposit from society to which Anoop
Singh requested for reconsideration vide letter dated c
06.06.1979.
On 11. 7 .1979 appellant's administration made it clear that
no allotment could be made in favour of respondent no.2 to which
Anoop Singh again requested for reconsideration vide letter
~,
-~ dated 11.11.1979. D
On 22.3.1980 appellant-administration informed Anoop
Singh that even though clause 5(2) of Lease Deed provides for
transfer without affidavit - allotment of plot could not be possible
unless original member establishes his own eligibility for
allotment for plot. However, opportunity of personal hearing was E
granted to Anoop Singh.
.> -l On 24.11.1980, Administrator of appellant-society
removed the name of Anoop Singh categorically stating that it
could not be transferred in favor of respondent no.2. F
On 22.1.1982, Secretary of the society also by its letter
informed Anoop Singh that transfer could only happen after
submission of indemnity bonds and affidavits so it is suggested
that respondent no.2 be made fresh member of society w.e.f.
date of transfer. G
• i
On 1.02.1982 Anoop Singh tendered his resignation.

· On 14.02.1992 respondent no.2 filed WP(C) being 686/
92 without challenging the orders of the Administrator dated
26.03.1979, 29.05.1979, 11.07.1979 and 24.11.1979, seeking H
336 SUPREME COURT REPORTS [2009) 2 S.C.R.

A writ of Mandamus asking appellant and respondent no.1 for • ..
allotment of plot or in alternative to refund money paid by
respondent no.2.
On 30.10.1995 Rule was issued. On 19.09.2005 ex-pa rte
proceedings qua appellant-society were initiated in High Court.
B
On 16.02.2006 the High Court allowed writ petition and
issued directions to respondent no.1 to recommend the case
to appellant-society for allotment of plot in category 'C' of 125
sq. yards.
c On 22.05.2006 appellant-society came to know about the
above ordervide letter dated t. 22.05.2006 issued by respondent
no.1.
On 01.07 .2006 appellant society then filed a Review Petition
being 268 of 2006 and on 1.9.2006 the High Court issued notice. ,,_
D
On 19.1.2007 the High Court dismissed review petition. ~

The High Court by the order in writ petition held that the
transfer in favour of Jasjit Kaur has been accepted by the Society
and therefore she was entitled to allotment of the plot. It was
E held that the Registrar, Cooperative Society had no authority in
law to sit over the affidavit and not to recommend the case for
allotment to Jasjit Kaur. A direction was therefore given· to the
Registrar, Cooperative Societies to forthwith recommend the ·t ~

case of Jasjit Kaur for allotment of plot in Category 'C' of 125
F sq. yards. A Review Petition was filed inter-alia taking the stand
that after Mr. Anoop Singh had asked· for refund of money, and
therefore, raising the question of any transfer in law did not arise.
The' review petition was rejected on the ground that no case for
review was made out.
G 4. Mr. K.T.S. Tulsi, learned counsel for the appellant ~ ....
submitted that the High Court has clearly lost sight of various
provisions, more particularly, Rule 25 of the Delhi Co-operative
Societies Rule, 1973 (in short the 'Rules') framed under Delhi
Co-operative Societies Act, 1972 (in short the 'Act'). It was
H pointed out that without availing the statutory remedies available
HINDUSTAN CO. HOUSING SOCIETY V. REGR., 337
CO-OP. SOCIETIES AND ANR. [DR. ARIJIT PASAYAT J.)
---t
.,... j under the Act and the Rules, the respondent No.2 Jasjit Kaur A
filed a writ petition. Since disputed questions were involved,
the High Court ought not to have interfered in the matter.
According to him directions given are clearly contrary to law.
5. In response, learned counsel for respondent No.2
submitted that she has been fighting a battle for getting her B
legitimate right and after having accepted the prayer for transfer,
the Society cannot turn around and take a stand that since Anoop
Singh was disqualified, the order of the High Court is
indefensible. In any event it is submitted that plot has been
allotted pursuant to the High Court's order and, therefore, by c
passage of time the petition has become infructuous.
6. We find that before the High Court there was no
appearance on behalf of the present appellant.

~ 7. Rule 25 of the Rules reads as follows: D
4
"25. Disqualification of Membership:
No person shall be eligible for admission as a member of
a co-operative society if he-
(a) has applied to be adjudicated an insolvent or is an
E
undischarged insolvent; or
~ ~ (b) has been sentenced for any offence other than an
offence of a political character or an offence not involving
moral turpitude and dishonesty and a period of five years F
has not elapsed from the date of expiry of the sentence:
(c) in the case of membership of a housing society:
(i) owns a residential house or a plot of land for the
construction of a residential house in any of the approved G
.. or un-approved colonies or other localities in the National
Capital Territory of Delhi, in his own name or in the name
of his spouse or any of his dependent children, on lease
hold or free-hold basis or on power of attorney or on
agreement for sale;
H
338 SUPREME COURT REPORTS [2009] 2 S.C.R.

A Provided that disqualification of membership as laid down ~ "

in sub-rule (l)(c)(i) shall not be applicable in case of co-
sharers of property whose share is less than 66. 72 sq.
metres of -land;
Provided further that the said disqualification shall not be
B applicable in case of a person who has acquired property
on power of attorney or through agreement for sale and on
conversion of the property from leasehold to freehold on
execution of conveyance deed for it, if such person applies
for the membership of the housing society concerned;
c (Amended on 6.8.97)
(ii) he deals in purchase or sale of immovable properties
either as principal or as agent in the national Capital
Territory of Delhi: or
D (iii) he or his spouse or any of his dependant children is /..
,.
a member of any other housing society except otherwise
permitted by the Registrar.
2. Notwithstanding anything contained in the rules or the
bye-laws of the co-operative society, if a member
E becomes, or has already become, subject to any
disqualification specified in sub-rule (1 ), he shall be
deemed to have ceased to be a member from the date -t ......
when the disqualifications were incurred.

F 3. A member who ceases to be a member of a co-
operative society under sub-rule (2) shall not be entitled to
exercise rights of memberships or incur liability as member
with effect from the date referred to in sub-rule (2) but as
from the date he becomes a creditor of the co-operative
society in respect of the amount due to him on account of
G
paid up share capital, deposit, cost of land deposited or .
any other amount paid by him to the co operative society
as its member. As from the date of his ceasing to be a
member or the society under sub-rule (2), the amount
standing to his credit shall be paid to him by the co-
H
HINDUSTAN CO. HOUSING SOCIETY V. REGR., 339
CO-OP. SOCIETIES AND ANR. [DR. ARIJIT PASAYAT J.]

·- ., operative society within 3 months and when the co- A
operative society is already under liquidation, the amount
due to him will be credited as a debt due to a third party
from the co-operative society.
4. If any question as to whether a member has incurred
B
any of the disqualification referred to in sub-rule (1) arises,
it shall be referred to the Registrar for de('.ision. His
decision shall be final and binding on all concerned. The
power of the Registrar under this rule shall not be delegated
to any other person appointed to assist the Registrar.
c
8. For the purpose of the present case Sub-rule (2) of Rule
25 is of paramount importance. There is a deemed disqualification.
The effect of it has not been examined by the High Court.
8. It is, as noted above, a deeming provision. Such a
D
. ~ provision creates a legal fiction. As_ was stated by James, L.J.
in Levy, Re, exp Walton (1881 (17) Ch.D 746)
"when a statute enacts that something shall be deemed to
have been done, which in fact and in truth was not done,
the court is entitled and bound to ascertain for what E

..
\
purposes and between what persons the statutory fiction
is to be resorted to. After ascertaining the purpose full
~
~
effect must be given to the statutory fiction and it should
be carried to its logical conclusion and to that end it would
be proper and even necessary to assume all those facts F
on which alone the fiction can operate."

(See Hill v. East and West India Dock Co. 1884 (9) AC
448, State of Travancore 9ochin v. Shanmugha Vilas
Cashewnut Factory (AIR 1953 SC 333), American Home
.. 1 Products Corpn. v. Mac Laboratories (P) Ltd 1986 (1) G
SCC 465 and Parayankandiyal Eravath Kanapravan
Kalliani Amma v. K. Devi (1996 (4) SCC 76). In an oft-
quoted passage, Lord Asquith stated: (All ER p. 599 B-D)
"If you are bidden to treat an im;::iginary state of affairs as H
340 SUPREME COURT REPORTS [2009) 2 S.C.R.

A real you must surely, unless prohibited from doing so, also
imagine as real the consequence and incidents which, if
the putative state of affairs had, in fact, existed must
inevitably have flowed from or accompanied it. . . . The
statute states that you must imagine a certain state of
B affairs, it does not say that having done so, you must cause
or permit your imagination to boggle when it comes to the
inevitable corollaries of that state of affairs".

(See East End Dwellings Co. Ltd. v. Finsbury Borough
Council 1951 (2) Alf ER 587 (HL))
c
10. "The word 'deemed' is used a great deal in modern
legislation. Sometimes it is used to impose for the purposes of
a statute an artificial construction of a word or phrase that would
not otherwise prevail. Sometimes it is used to put beyond doubt
D a particular construction that might otherwise be uncertain.
Sometimes it is used to give a comprehensive description that
includes·what is obvious, what is uncertain and what is, in the
ordinary sense, impossible."
(Per Lord Radcliffe in St. Aubyn (L.M.) v. Attorney-General
E
(No. 2)1951 (2) All ER 473 , All ER p.498 F-G.]
11. "Deemed", as used in statutory definitions is meant "to
extend the denotation of the defined term to things it would not
in ordinary parlance denote, is often a convenient devise for ·
F reducing the verbiage of an enactment, but that does not mean
that wherever it is used it has that effect; to deem means simply
to judge or reach a conclusion about something, and the words
'deem' and 'deemed' when used in a statute thus simply state
the effect or meaning which s6me matter or thing has - the way
G in which it is to be adjudged; this need not import artificiality or
fiction; it may simply be the statement of an undisputable
conclusion." (Per Windener, J. in Hunter Douglas Australia Pty
v. Perma Blinds 1970 (44) Aust LJ 257.)
12. When a thing is to be "deemed" something else, it is
H
-f

..
...._,
HINDUSTAN CO. HOUSING SOCIETY V. REGR., 341
CO-OP. SOCIETIES AND ANR. [DR. ARIJIT PASAYAT J.]
!"'
'-" , to be treated as that something else with the attendant A
consequences, but it is not that something else (per Cave, J.,
R. v. Norfolk County Court 1891 (60) LJ QB 379).
"When a statute gives a definition and then adds that certain
things shall be 'deemed' to be covered by the definition,
B
it matters not whether without that addition the definition
would have covered them or not."

(Per Lord President Cooper in Ferguson v. McMillan 1954
SLT 109)
13. Whether the word "deemed" when used in a statute
c
...,. established a conclusive or a rebuttable presumption depended
upon the context (see St. Leon Village Consolidated School
Distt. v. Ronceray 1960 (23) DLR (2d) 32)).
"I ... regard its primary function as to bring in something D
-<\
.r which would otherwise be excluded."

(Per Viscount Simonds in Barclays, Bank v. /RC 1961 AC
509 (HL).
14. "Deems" means "is of opinion" or "considers" or E
"decides" and there is no implication of steps to be taken before
the opinion is formed or the decision is taken .
., .. [See R v. Brixton Prison (Go.vernor), ex p Sob/en 1962
(3) All ER 641, All ER p.669 C.]
F
15. Learned counsel for the appellant is right that normally
when a statutory remedy is available, the same should be
availed. In the instant case that aspect has also not been
examined by the High Court. We are therefore of the considered
opinion that the writ petition needs to be h.eard by the High Court G
.... ., afresh to be decided keeping in view the applicable legal
provision. Since no counter affidavit had been filed by the
present appellant before the High Court we permit it to do so
within a period of one month. If any rejoinder is to be filed the
same shall be filed within a period of two weeks from the date H
342 SUPREME COURT REPORTS [2009] 2 S.C.R.

A of filing of the counter affidavit. We request the High Court to
explore the possibility of disposing of the writ petition within a
period of four months by fixing a definite date after a period of
six weeks from today. Till the disposal of the writ petition by the
High Court afresh, no third party rights in respect of the plot F
B which is stated to have been allotted to respondent No.2 shall
be created by the appellant.
16. The appeal is allowed to the aforesaid extent with no
f.--
order as to costs. .. r
\
>

R.P. Appeal allowed.

,.,
)

r

.. t
L