ISHWAR NAGAR CO-OP.HOUSE BUILDING SOCIETYversusPARMA NAND SHARMA AND ORS.

                   [2010] 13 (ADDL.) S.C.R. 966


A     ISHWAR NAGAR CO-OP.HOUSE BUILDING SOCIETY
                             v.
            PARMA NANO SHARMA AND ORS.
              (Civil Appeal No.9671 of 2010)
                        NOVEMBER 15, 2010
B
      [DR. MUKUNDAKAM SHARMA AND ANIL R. DAVE,
                        JJ.]

        Delhi, Cooperative Societies Rules, 1973:
c
       r.25(2) - Retrospective or prospective in effect - Held:
  r.25(2) operates in future, though the basis for taking action
  is the factum of acquiring a plot in the past - Thus, when by
  virtue of r.25(2), a member is deemed to have ceased to be
0 a member of the society, the cessation operates from April
  2, 1973, when the rules came into force - Merely because a
  person who had become a member of the society at a point
  of time when the disqualification mentioned in r.25 was not in
  existence and because of the said rule would cease to be a
  member of the society would not necessarily mean that the
E said rule is retrospective - r. 25(2) is not retrospective - Delhi
  Co-operative Societies Act, 1972 - s.97(1) - Cooperative
  Societies - Retrospective operation.

       r. 25 - Applicability of, when property purchased in the
F name of HUF - Held: r.25(1)(c)(i) provides an exception in
  case of persons who are only co-sharers in the joint family
  property - 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. m. (BO yds) of
G land - In the instant case, the share of the member in the
  purchased property was more than the prescribed limit -
  Thus, the said exception was not applicable to his case -
  Even otherwise, ownership by HUF is ownership of property
  by the family members and consequently the same would
H                                 966
 ISHWAR NAGAR COOP.HOUSE BUILDING SOCIETY v.              967
            PARMA NANO SHARMA

clearly fall within the prohibition and bar of allotment as A
contained in clause 5(a) of the lease deed - In terms of
clause 5 (a) of the lease deed, the appellant society was under
an obligation not to allot a residential plot to a person, who
was owning a property in the city of Delhi - Therefore, it was
obligatory for the Society not to allot plots of land to such B
persons who own any residential properly either in their own
name or in the name of their family member.

     r.25 - Acquisition of separate accommodation by a
member of the Cooperative Housing Society - Termination
of membership by appellant-society - Validity of - Held: In C
the light of r.25, the action of the appellant-society would be
valid if the said properly was found to be a residential house
- In self-assessment property tax forms filled by the member
with respect to the said property, the member opposed the
assessable value shown in. the assessment notice on the D
ground that the building on the said plot was under self-
occi.Jpation for residence and self professional-medical work
only and was a single-unit house - The said information about
the nature and status of his property was furnished by the
member under his own declaration - For retaining the E
membership of the appellant-society, he cannot claim that the
said property was used purely for commercial purpose.

    Delhi Co-operative Societies Act, 1972:

      s.97(1)- Power of Lt. Governor under, to frame r.25(2)-    F
Held: r.25(2) prescribes that a member would cease to be a
member on incurring certain disqualifications - r. 25(2) does
not in any manner go beyond the ambit of rule making
authority given u/s. 97(1) of the Act - The object of a co-
operative society is not to earn profits but to enable the       G
members to improve their economic conditions by helping
them in their pursuits - Thus, the cooperative societies which
seek to obtain the land at concessional rate from the
government to build houses must necessarily have a
limitation that only members who are in real need of houses      H
    968    SUPREME COURT REPORTS (2010] 13 (ADDL.) S.C.R.


A should be permitted to become members and to take the
    benefit of land allotment - Cooperative Societies.

        Bye-laws of lshwar Nagar Cooperative Housing Building
    Society, 1962:                                  ·
B       Bye-law B(vii) - Acquisition of separate accommodation
  - Disqualification of member - Held: Bye-laws of the society
  regulate the management of the society and govern the
  relationship between society and members inter se - They
  are in the nature of Articles of Association of a company
C registered under the Companies Act - If they are consistent
  with the Act and Rules, the members are bound by them -
  Bye-law B(vii) showed that purchasing a house or a plot of land
  for construction of a house, either in his own name or in name
  of any of his dependants, disqualifies a member of the society
D to continue as one - The said bye-law was neither
  inconsistent with the Bombay Cooperative Societies Act, 1925
  under which the appellant society was governed nor was it
  contrary to Delhi Cooperative Societies Act, 1972 and the.
  Rules framed thereunder - Therefore, a member of the
E society who acted in violation of the said bye law was liable
  to have his or her membership removed from the appellant-
  society - Delhi Co-operative Societies Act, 1972 - Delhi
  Cooperative Societies Rules, 1973 - r.25 - Bombay
  Cooperative Societies Act, 1925.
F        Bye-law No. 5(i)(e) - Expression "eligible to be a
    member" - Interpretation of - Held: The verb "be" has two
    meanings, namely, to exist, and to become - Constitution of
    India, 1950 - Article 102(1).

G         Cooperative Societies: Meaning and object of.

         Words and phrases: Word 'be' - Meaning of- Constitution
    of India, 1950 - Article 102(1).

          Respondent no.1 was enrolled as a member of the
H
  ISHWAR NAGAR COOP.H6usE
                        I
                          BUILDING SOCIETY
                                         .
                                           v.        969
             PARMA NANO SHARMA

appellant-cooperative society on 11.3.1961. In 1962, he     A
 purchased a property in Kailash Colony in the name of
the HUF consisting of himself, his wife and children and
 raised construction on it. According to the appellant-
 society, the construction was a residence-cum-nursing
 home while respondent no.1 claimed it to be only a         B
 nursing home. The appellant-society terminated the
 membership of respondent-1 on the ground that as per
 rule 25(1)(c) of the Delhi Cooperative Societies Rules,
 1973 upon owning another property, the appellant would
·not be entitled to be member of a cooperative housing      c
 society.

     The questions which arose for consideration in the
instant appeal were whethe~: Rule 25 of the Rules had a
retrospective application in debarring a member of a co-
operative society who enrolled as a member of the           D
society and acquired separate property before the Rules
came into force; whether bye-laws of the society could
debar respondent no.1 on acquisition of a ~eparate
residential/dwelling house in Delhi; whether the property
purchased in the name of HUF would debar respondent         E
no.1 to continue as a memb,er of the appellant-society;
and whether the nature of the property purchased was
residential or commercial. :

    Allowing the appeal, the Court                          F
     HELD: 1.1. A perusal of Rule 25(2) of Delhi
Cooperative Societies Rules, 1973 would make it clear
that after the said Rules came into force, if a member had
already become subject to any disqualification specified
in sub- rule (1), he would be deemed to have ceased to G
be a member from the date when the disqualification was
incurred. In the instant case, the relevant rule was Rule
25(1)(c)(i). The said Rule also stipulated that no person
shall be eligible for admission as a member of the co-
operative society, if he owns a residential house or a plot H
    970    SUPREME COURT REPORTS [2010) 13 (ADDL.) S.C.R.


A   of land for the construction of a residential house in any
    of the 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. It is incorrect to say that Rule 25
    was not applicable to his case as the said rule was not
B   retrospective and the alleged disqualification of
    purchasing the said property had incurred prior to the
    adoption of the Rules. Merely because a person who had
    become a member of the society at a point of time when
    the disqualification mentioned in Rule 25 was not in
c   existence and because of the said rule would cease to
    be a member of the society does not necessarily mean
    that the said rule is retrospective. The most concrete
    cases wherein laws are made retrospective are those in
    which the date of commencement is earlier than
    enactment, or which validate some invalid law, otherwise,
0
    every statute affects rights which would have been in
    existence but for the statute and a statute does not
    become a retrospective one because a part of the
    requisition for its action is drawn from a time antecedent
E   to its passing. In this view of the matter, Rule 25(2) is not
    retrospective. All that Rule 25(2) does is that it operates
    in future, though the basis for taking action is the factum
    of acquiring a plot in the past. Thus when by virtue of
    Rule 25(2), a member is deemed to have ceased to be a
    member of the society, the cessation operates from April
F   2, 1973, when the rules came into force. [Paras 8, 12, 15)
    (981-A-F; 984-A-H; 985-A; 986-D~F]
         State of Maharashtra v. Vishnu Ramachandra 1961 Cri
    L. J 450 - relied on.
G
        Queen v. Vina (1875) 10 Q.B 195; Re: Solicitors Clerk
    (1957) 3 AH. E.R. 617 - referred to.

          Graise on Statute Law 17th edition page 386, referred .
    to.
H
  ISHWAR NAGAR COOP.HOUSE BUILDING SOCIETY v.            971
             PARMA NANO SHARMA

     1.2. Section 97(1) of the Delhi Co-operative Societies      A
Act, 1972 gives the power to the Lt. Governor to frame
rules to carry out the purposes of the Act. The specific
provisions as are contained in several clause of sub-
section (2) of Section 97 are merely illustrative and they
cannot be read as restrictive of the generality of powers        B
prescribed by sub section (1) of Section 97. The particular
matters given in sub-section (2) only illustrate and do not
exhaust all the powers conferred. The power to frame
rules given under Section 97(1) of the Act is not
controlled by the list mentioned in sub-section (2) and the      C
Lt. Governor can make rules for any of the purposes of
the Act. A co-operative society may be defined as a
voluntary association of individuals combined to achieve
an improvement in their social and economic conditions
through the common ownership and democratic
management of the instruments of wealth. The voluntary           D
organizations like cooperative societies suit the needs of
poor and weaker sections. The object of a co-operative
society is not to earn profits but to enable the members
to improve their economic conditions by helping them in
their pursuits. Thus, the cooperative societies like the         E
one in instant case which seek to obtain land at
concessional rate from the government and to build
houses must necessarily have a limitation that only
members who are in real need of houses should be
permitted to become members and to take the benefit of           F
land allotment. In the garb of a cooperative society, a
person cannot be permitted to avoid the stress of market
prices and take a concessional advantage in obtaining a
plot. Thus, Rule 25(2) does not in any· manner go beyond
the ambit of rule making authority given under                   G
Section 97(1) of the Act. [Paras 10, 11] [981-C-E; 983-G-
H; 984-A-D]

    Afzal Ullah v. State of Uttar Pradesh AIR 1964 SC 264;
Rohtak Hissar District Electricity Supply Co. Ltd. v. State of   H
   972   SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A Utter Pradesh and Ors. AIR 1966 SC 1471 - relied on.

        Row's Encyclopedia of Co-operative Societies Law in
   India, Vol. 2, page 1 - referred to.

       2. The Bye-laws of lshwar Nagar Cooperative
B Housing Building Society, 1962 came into force on
  3.10.1962. The eligibility conditions for enrollment as a
  member of the society were provided in chapter Ill of the
  said bye-laws. Bye-law No. 8 (vii) provides for cessation
  of membership. A perusal to the bye-law would make it
C clear that on purchasing a house or a plot of land for
  construction of a house, either in his own name or in the
  name of any of his dependants, disqualifies a member of
  the society to continue as one. The Bye-laws of the
  society regulate the management of the society and
D govern the relationship between society and members
  inter se. They are similar in nature to the Articles of
  Association of a company registered under the
  Companies Act. If they are consistent with the Act and
  the Rules, the members are bound by them. Bye-law 8(vii)
E was neither inconsistent with the Bombay Cooperative
  Societies Act, 1925 under which the appellant society was
  governed nor was it contrary to Delhi Cooperative
  Societies Act, 1972 and the Rules framed thereunder.
  Therefore, a member of the society who acted in violation
  of the said bye-law was liable to have his or her
F membership removed from the appellant-society. The
  expression "eligible to be a member" is used in the 1962
  bye-law 5(i)(e). The verb "be" has two meanings, namely,
  (a) to exist, and (b) to become. The former refers to the
  existence of state of affairs in present while the latter
G refers to the coming into existence of a new state of
  affairs. In Article 102(1) of the Constitution, the word "be"
  is used in the sense of "exist" as contrasted to "become".
  Under Article 102(1 ), a person is disqualified for "being
  chosen as" and also for "being a member of either
H
  ISHWAR NAGAR COOP.HOUSE BUILDING SOCIETY v.            973
             PARMA NANO SHARMA
Houses of Parliament" etc. The dichotomy is between             A
becoming a member and continuing to be a member of
parliament. It is, therefore, to be concluded that even
under Bye-law 5(i)(e) of Bye-laws of lshwar Nagar
Cooperative Housing Building Society, 1962, respondent
no.1 was disabled from continuing to be members of the          B
society. [Paras 16, 17, 18, 21] [986-G-H; 987-C-E, G-H;
988-A; 989-A-F]

     Zoroastrian Coop. Housing Society Ltd. v. District
Registrar, Coop. Societies (Urban), (2005) 5 SCC 632 -          C
relied on.

     3.1. Sub-rule (1)(c)(i) of Rule 25 provides an exception
in case of persons who are only co-sharers in the joint
family property, in that the disqualification of membership
as laid down in sub-rule (l)(c)(i) shall not be applicable in D
case of co-sharers of property whose share is less than
66.72 sq. m. (80 yds) of land. In the instant case, the said
property is admeasuring 1080 yds and there are 3 co-
sharers of the property, i.e. respondent no.1 and his two
children, (after the death of wife) and the share of E
respondent no.1 would be more than the prescribed limit.
In this regard, the said exception is not applicable to the
case of respondent no.1. [Para 22] [990-A-C]

     3.2. Further, a perpetual lease deed with respect to
                                                                F
the land allotted to the appellant society was executed on
06.04.1978 by the President of India through the Delhi
Administration. In terms of clause 5 (a) of the said lease
deed, the appellant society was under an obligation not
to allot a residential plot to a person, who was owning a
property in the city of Delhi. The.refore, as per terms of      G
allotment of the land to the appellant, it was obligatory for
the society not to allot plots of land to such persons who
own any residential property either in their own name or
in the name of their family member. When the Hindu
Undivided Family of the respondent consists only of his         H
    974 SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A own family members, namely, his wife, son and the
  daughter, obviously ownership of the said property by
  the Hindu Undivided Family of the respondent is
  ownership of property by the family members and
  consequently the same would clearly fall within the
B prohibition and bar of allotment as contained in clause 5
  (a) of the lease deed. [Para 22) [990-D-E]

         4. In the light of Rule 25, the action of the appellant-
    society would be justified if the said property is found to
C   be residential house. The mere fact that respondent no.1
    had shown in affidavits and correspondences the said
    property as his address would not prove that the property
    is a residential house as being a doctor running a nursing
    home, he had to remain invariably in his workplace for
    very long hours. However, in self-assessment property
D   tax forms filled by respondent no. t with respect to the
    said property, respondent no.1 opposed the assessable
    value shown in the assessment notice on the ground that
    the building on the said plot was a new constructed
    building and was under self-occupation for residence
E   and self professional-medical work only and was a single-
    un it house. The respondent for the purpose of being
    member of the appellant-society cannot claim the said
    property used purely for commercial purpose when he
    himself claimed the said property being used for
F   residential purpose also. The said information about the
    nature and status of his property in Kailash Colony was
    furnished by the respondent under his own declaration
    and by certifying that the said particulars filled in the form
    are true and correct •• the best of his knowledge. The
G   information was relevant and material to conclude that
    the said property in Kailash Colony was also used as a
    residential property and, therefore, the contention for
    respondent no.1 that it was exclusively a commercial
    property cannot be accepted. [Para 23) [991-E-H; 992-A-
H DJ
 ISHWAR NAGAR COOP.HOUSE BUILDING SOCIETY v.            975
            PARMA NANO SHARMA
                    Case Law Reference:                        A

    AIR 1964 SC 264            relied on           Para 10
    AIR 1966 SC 1471           relied on           Para 10
    1961 Cri L. J 450          relied on           Para 12     B
    (1875) 10 Q.B 195          referred to         Para 13
    (1957) 3 AH. E.R. 617      referred to         Para 13 ·

    (2005) 5 sec 632           relied on           Para 17
                                                               c
    CIVIL APPELLTAE-<IURISDICTION : Civil Appeal No.
9671 of 2010.

    From the Judgment & Order dated 28.3.2008 of the High
Court of Delhi at New Delhi in W.P.(C) No. 474 of 1982.
                                                               D
    P.S. Narsimha, Abhay Kumar, K. Parmeshwar, Ritesh K.
Chowdhary, Tenzing Tsering, Madhumita Singh for the
Appellant.

     Arun Mohan, Sameer Parekh, Arvind Bhatt, Sumit Goel,      E
Pallavi Sharma, Smita Bhargava, R.K. Gupta, Shashi Gupta,
Parekh & Co., Indira Sawhney, Shweta Verma, Anil Katiyar,
Sharmila Upadhyay for the Respondents.

    The Judgment of the Court was delivered by
                                                               F
    DR. MUKUNDAKAM SHARMA, J. 1. Leave granted.

     2. This Appeal is directed against the judgment and order
dated 28/03/2008 in W.P. No. 474/1982 of the High Court of
Delhi wherein the High Court allowed the writ petition filed by G
the respondent-1 and whereby resolution and order dated 14th
January, 1978 passed by the appellant and the order of the
Registrar, Cooperative Societies dated 17th May, 1978 and the
order of the Deputy Registrar dated 5th November, 1981
whereby the name of the respondent-1 had been removed from
                                                               H
    976   SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A   the list of members of the appellant-society were quashed and
    set aside.

        3. The respondent-1, Dr. Parmanand Sharma was enrolled
  as a member of the appellant society vide membership No. 35
  on 11th March 1961. In 1968, he purchased a property bearing
8
  No. A-19/A, Kailash Colony, New Delhi in the name of his
  Hindu Undivided Family consisting of respondent-1, his wife
  and two minor children in 1968 and a structure was constructed
  thereon in 1969. According to the appellant-society, this'
  construction is a residence-cum-nursing home, whereas
C respondent-1 claims it to be only 'a nursing home, to which
  question we will refer later. In this chain of events, the
  membership of the respondent-1 was terminated from the
  appellant society on the ground that the respondent-1 owned
  another property, i.e., 19/A, Kailash Colony, in Delhi, since as
D per rule 25 (1)(c) of the Delhi Cooperative Societies Rules, 1973
  (hereinafter referred to as "the Rules" ), upon owning another
  property, the appellant was not entitled to be member of a
  Cooperative Housing Society. The respondent-1 was also
  expelled on 14th January 1978 from the society under section
E 36(1) of the Delhi Cooperative Societies Act, 1972 (hereinafter
  referred to as "the Act") for being a persistent defaulter, since
  he had not paid the dues demanded by the society. The action
  of the society expelling the respondent-1 was approved by the
  Registrar, Cooperative Societies on 17th May 1978. On 26th
F February 1980, an application was filed by respondent-1 under
  Section 60 of the Act for reference of dispute to arbitration. The
  reference was dismissed on 5th November, 1980. Being
  aggrieved, the respondent filed a writ petition before the High
  Court, wherein the High Court by the impugned judgment and
G order dated 28/03/2008 held that 19/A, Kailash Colony, Delhi
  was being used for running a nursing home, i.e., for a
  commercial purpose and therefore, that would not constitute a
  violation of Rule 25 of the Rules. By the said order, the HC set
  aside the expulsion orders.
H
  ·,

 ISHWAR NAGAR COOP.HOUSE BUILDING SOCIETY v. 977
PARMA NANO SHARMA [DR. MUKUNDAKAM SHARMA, J.]

      4. The present appeal is directed against the above             A
impugned judgment and order of the High Court by way of
Special Leave Petition on which we heard the counsel
appearing for the parties at length. The learned counsel for the
appellant contended that on the ground floor of the said
property, the respondent-1 is running a nursing home and that         B
he is residing on the first floor. In that view, the appellant
contended that the property was being used for residential
purposes. Counsel for the appellant also submitted that the
respondent-1 in his various correspondences, pleadings and
affidavits has shown the property as his address which is             c
conclusive proof that he is residing in the said property.
Moreover, it was also contended that respondent-1 had been
unable to disclose where he was alternatively residing and no
documents had been furnished to show that the said property
was being used exclusively and solely for commercial purpose.         0
In this regard, it was submitted that the user of the said property
being a resident therein, this not only violates Rule 25 of the
Rules, but also is contrary to the bye laws of the society and
the terms of perpetual lease agreement entered between Govt.
of India and the appellant society, in pursuance of which the         E
respondent-1 would be entitled as being member of the
appellant-society. On the other hand, the learned counsel for the
respondent-1 refuted the claims made by the appellant
contending that the said property was used solely for a nursing
home, and since respondent-1 remained in the nursing home
for most of the time as a doctor, therefore it was solely for         F
convenience's sake that he used the address to further
correspondence. This aspect, it was submitted, would not
render the property residential in any way. Further, counsel for
respondent-1 contended that the said property was purchased
in the name of the HUF, and not in respondent-1's name, and           G
therefore the latter cannot be expelled from the membership of
the appellant-society. He also submitted that the respondent-1
cannot be expelled because of purchase of the said property
was facilitated before the Rules came into force in exercise of
power granted under the Delhi Cooperative Societies Act,              H
    978    SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A   1972. It was further contended that at the time of acquisition of
    membership of the said society, the appellant's society was
    governed by the Bombay Cooperative Societies Act, 1925,
    which doesn't have any provision disqualifying a member of a
    cooperative society on acquisition of another property in Delhi.
B   Rule 25 has no retrospective application; therefore it was
    submitted that expulsion of the respondent-1 is non est in law.

         5. After hearing the parties in detail the questions which
    arise in this appeal are: -

c         I.     Whether Rule 25 of the Rules has a retrospective
                 application in debarring a member of a co-
                 operative society who enrolled as a member of the
                 society and acquired separate property before the
                 Rules came into force?
D
          II.    Whether bye laws of the society can debar the
                 respondent-1 on acquisition of a separate
                 residential/dwelling house in Delhi?

          Ill.   Whether the property purchased in the name of
E                HUF can debar the respondent-1 to continue as a
                 member of the appellant-society?

          IV.    Whether the nature of the property purchased is
                 residential or commercial?
F
    Issue I
       6. As far as applicability of Rule 25 of the Rules is
  concerned, the learned counsel for the appellant contended that
  the provisions contained in Rule 25 are applicable to all the
G members of the society, whether enrolled before or after the
  enactment of the Delhi Co-operative Societies Rules, 1973
  and in view of the said rule, the respondent-1 was ineligible to
  continue to be a member of the society and his membership
  was correctly terminated in accordance with law. In contrast, the
H learned counsel for the respondent-1 contended that at the time
 ISHWAR NAGAR COOP.HOUSE BUILDING SOCIETY v.  979
PARMA NANO SHARMA [DR. MUKUNDAKAM SHARMA, J.]

of enrolment of respondent-1 and subsequent to purchasing of A
the property, the co-operative societies in Delhi were governed
by the Bombay Co-operative Societies Act, 1925 as extended·
to Delhi Co-operative Societies Rules, 1950. There was no
prohibition whatsoever at the relevant time for a person who
was a member of the co-operative society from purchasing any B
property. Subsequently, on 24.4.1973, the Delhi Co-operative
Societies Act and Delhi Co-operative Societies Rules, 1973
came into force and the earlier Act and the 1950 Rules stood
repealed. The 1973 rules prescribed eligibility criteria for
admission under the said Rule 25 and the eligibility criteria for c
admission are not same as required for continuation. Moreover,
it was contended that Rule 25 has no retrospective application.

    7. Rule 25 reads as follows: -

    "Disqualification for Membership- (1) No person shall be      D
    eligible for admission as a member of a. co-operative
    society if he -

    (a) has applied to adjudicated an insolvent or is an
    undischarged insolvent; or
                                                                  E
    (b) has been sentenced for any offence other than an
    offence not involving moral turpitude and dishonesty and
    a period of five years has not elapsed from the date of
    expiry of the sentence:
                                                                  F
    (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
    or un-approved colonies or other localities in the National
    Capital Territory of Delhi, in his own name or in the name    G
    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;

    Provided that disqualification of membership as laid down
                                                                  H
    980     SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A         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 applicable in case of a person
          who has acquired property on power of attorney or through
B         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; (Amended on 6.8.97)

          (ii) he deals in purchase or sale of immovable properties
c         either as principal or as agent in the national Capital
          Territory of Delhi: or (iii) he or his spouse or any of his
          dependent children is a member of any other housing
          society except otherwise permitted by the Registrar.

D     . 2. Notwithstanding anything contained in the rules or the
        bye-laws of the co-operative society, if a member
        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
E       when the disqualifications were incurred.

          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
F         (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 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
G         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-operative society within 3 months and when the co-
          operative society is already under liquidation, the amount
          due to him will be credited as a debt due to a third party
H         from the co-operative society.
   ISHWAR NAGAR COOP.HOUSE BUILDING SOCIETY v.  981
  PARMA NANO SHARMA [DR. MUKUNDAKAM SHARMA, J.]

       4. If any question as to whether a member has incurred              A
       any of the disqualification referred to in sub-rule (1) arises,
       it shall be referred to the Registrar for decision. 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."             B

          8. A perusal to Rule 25(2) makes it clear that after the said
    Rules came into force, if a member has already become
    subject to any disqualification specified in sub rule (1 ), he would
    be deemed to have ceased to be a member from the date
    when the disqualification was incurred. In the present case, the       C
    rule which is to be considered is Rule 25(1)(c)(i). The said Rule
    also stipulates that no person shall be eligible for admission
    as a member of the co-operative society, if he owns a
    residential house or a plot of land for the construction of a
    residential house in any of Territory of Delhi, in his own name        D
    or in the name of his spouse or any of his dependent children,
    on lease-h.old or free-hold basis. The learned counsel for the
    respondent-1 contended that since the said rule does not
    come within the ambit of power given under Section 97(2) of
    the Act to the Lt. Governor who is empowered to make rules             E
    about the conditions to be complied with by persons applying
    for admission or admitted as members, the same cannot be
    applied to the person who have already become a member to
    disqualify him for the act done prior to coming into force of the
    Rules. Further it was also contended that the said power is            F
    limited by section 98 of the Act which repeals the earlier Act
... and saves the right, privileges or obligations accrued or incurred
    under the earlier Act repealed.

       9. The first consideration in this regard is whether Section        G
  97 of the Act permits the Lt. Governor to make the above
  disputed provision of rule 25. Section 97 of the Act reads as
  follows:

       "97 (1) The Lieutenant Governor may, for any co-operati\Je
       society or class of co-operative societies, make rules to           H
    982    SUPREME COURT REPORTS [2010) 13 (ADOL.) S.C.R.


A         carry out the purposes of this Act.

          (2) In particular, and without prejudice to the generally of
          the foregoing power, such rules may provide for all or any
          following matters, namely ... -
B         .... (v)The conditions to be complied with by persons
          applying for admission or admitted as members, for the
          election admission of members, and for the payment to be
          made and the interest to be acquired before the exercise
          of the right of membership."
c
        10. A perusal of the aforementioned provision indicates
  that the power to frame rules is given by S. 97(1) to the Lt.
  Governor to make rules to carry out the purposes of this Act
  and the list of subjects mentioned in sub rule (2) is merely
0 illustrative as is clear when it says that "Jn particular, and
  without prejudice to the generally of the foregoing power, such
  rules may provide for all or any matters contained therein". It
  is well-settled that the specific provisions as are contained in
  several clause of sub-section (2) of 97 are merely restrictive
E and they cannot be read as restrictive of the generality of powers
  prescribed by sub section (1) of S. 97. The particular matters
  given in sub section (2) only illustrate and do not exhaust all the
  powers conferred. In that connection reference may be made
  to two analogous cases. First to that of Afzal Ullah v. State of
  Uttar Pradesh reported at AIR 1964 SC 264 wherein principles
F for interpreting a provision similar in objective (of the United
  Provinces Municipalities Act, 1916) were laid down. This Court
  in the said case, held:

          "13 ......... It is now well-settled that the specific provisions
G         such as are contained in the several clauses of Section
          298(2) are merely illustrative and they cannot be read as
          restrictive of the generality of powers prescribed by
          Section 298(1 ). If the powers specified by Section 298(1)
          are very wide and they take in within their scope Bye-laws
H         like the ones with which we are concerned in the present
 ISHWAR NAGAR COOP.HOUSE BUILDING SOCIETY v.  983
PARMA NANO SHARMA [DR. MUKUNDAKAM SHARMA, J.]

    appeal, it cannot be said that the powers enumerated           A
    under Section 298(2) control the general words used by
    Section 298(1). These latter clauses merely illustrate and
    do not exhaust all the powers conferred on the Board, so
    that any cases not falling within the powers specified by
    Section 298(2) may well be protected by Section 298(1 ),       B
    provided, of course, the impugned Bye-law can be justified
    by-reference to the requirements of Section 298(1 )."

    This rule of interpretation was again reiterated in Rohtak
Hissar District Electricity Supply Co. Ltd. Vs. State of Utter     C
Pradesh and Ors. reported at Al R 1966 SC 1471:

    "18 .......... Section 15(1) confers wide powers on the
    appropriate Government to make rules to carry out the
    purposes of the Act; and s. 15(2) specifies some of the
    matters enumerated by clauses (a) to (e), in respect of        D
    which rules may be framed. It is well-settled that the
    enumeration of the particular matters by sub-s. (2) will not
    control or limit the width of the power conferred on the
    appropriate Government by sub-s. (1) of s. 15; and so, if
    it appears that the item added by the appropriate              E
    Government has relation to conditions of employment, its
    addition cannot be challenged as being invalid in law.
    Whether or not such addition should be made, is a matter
    for the appropriate Government to decide in its discretion.
    The reasonableness of such addition cannot be                  F
    questioned, because the power to decide which additions
    should be made has been left by the Legislature to the
    appropriate Government."

     11. In view of the above position, it may be deduced that
the power to frame rules given under s. 97(1) of the Act is not    G
controlled by 1he list mentioned in sub section (2) and the Lt.
Governor can make rules for any of the purposes of the Act. A
co-operative society may be defined as a voluntary association
of individuals combined to achieve an improvement in their
social and economic conditions through the common ownership        H
    984   SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A and democratic management of the instruments of wealth.
  (Vide Row's Encyclopedia of Co-operative Societies Law in
  India, Vol. 2, page 1) Experience has shown that voluntary
  organizations like cooperative societies are the best system
  which can suit the needs of poor and weaker sections. The
B object of a co-operative society is not to earn profits but to
  enable the members to improve their economic conditions by
  helping them in their pursuits. Thus, the cooperative societies
  like the present one which seek to obtain the land at
  concessional rate from the government and to build houses
c must necessarily have a limitation in that only members who
  are in real need of houses should be permitted to become
  members and to take the benefit of land allotment. In the garb
  of a cooperative society, a person cannot be permitted to avoid
  the stress of market prices and take a concessional advantage
0 in obtaining a plot. Thus Rule 25(2) does not in any manner go
  beyond the ambit of rule making authority given under
  Section 97(1) of the Act.

        12. The learned counsel for the respondent-1 further
   contended that the Rule 25 is not applicable to the respondent-
E 1's case as the said rule is not retrospective and the alleged
   'disqualification' of purchasing the said property had incurred
   prior to the adoption of the Rules. We are of the considered
   opinion that the aforesaid contention of the learned counsel for
   the respondent-1 is misconceived. Merely because a person
F who had become a member of the society at a point of time
   when the disqualification mentioned in Rule 25 was· not in
   existence and because of the said rule would now cease to be
  ·a member of the society does not necessarily mean that the
   said rule is retrospective. "A statute is not properly called a
G retrospective statute because a part of the requisites for its
   action is drawn from a time precedent to its passing". (See
   Graise on Statute Law. 17th edition page 386). Reference may
   also be made to Queen v. Vina reported at (1875) 10 Q.B
   195 wherein the Statute enacted that every person convicted
H of felony shall be for ever disqualified from selling spirits by
 ISHWAR NAGAR COOP.HOUSE BUILDING SOCIETY v.  985
PARMA NANO SHARMA [DR. MUKUNDAKAM SHARMA, J.]

retail. It was held that the disqualification applied to. every     A
convicted felon irrespective of whether he was so convicted
prior to or after the Act came into operation.

     13. A reference may also be made to Re: Solicitors Clerk
reported at (1957) 3 AH. E.R. 617, wherein the bone of              8
contention revolved around that Solicitor's Act of 1956 which
provided that no solicitor should employ any person who is
convicted of larceny without the. permission of the Law Society.
The clerk in that case was convicted of larceny in 1953, while
the ban was imposed in 1956. It was urged that the provisions       C
of the 1956 Act cannot be applied to him because he was
convicted before that Act came into operation. ''To do otherwise,
it was argued, would be to make its operation retrospective. In
rejecting this contention, Lord Goddard, C.J. observed:

    "In my opinion, this Act is not in truth retrospective. It      D
    enables an order to be made disqualifying a person from
    acting as a solicitor's clerk in the future and what
    happened in the past as the cause or reason for the
    making of the order; but the order has no retrospective
    effect. It would be retrospective if the Act provided that      E
    anything done before the Act came into force or before
    the order was made should be void or voidable, or if a
    penalty were inflicted for having acted in this or any other
    capacity before the Act came into force or before the order
    was made. This Act simply enables a disqualification to         F
    be imposed for the future which in no way affects anything
    done by the appellant in the past. Accordingly, in our
    opinion the disciplinary committee had jurisdiction to
    make the order complained of'

     14. Same principle was applied in State of Maharashtra         G
v. Vishnu Ramachandra reported at 1961 Cri L. J 450 where
Section 57 of the Bombay Police Act, 1951 authorised removal
of a person from an area if he has been convicted of certain
offences including theft. The Supreme Court held that
                                                                    H
    986    SUPREME counT REPORTS [2010] 13 (ADDL.) S.C.R.


A         "18. 'Section. 57 of the Bombay Police Act, 1951 does not
          create a new offence nor makes punishable that which was
          not an offence. It is designed to protect the public from the
          activities of undesirable persons who have been convicted
          of offences of a particular kind. The section only enables
B         the authorities to take note of their conviction and to put
          them outside the area of their activities so that the Public
          may be protected against a repetition of such
          activities ........ .

          18. An offender who has been punished may be restrained
c         in his acts and conduct by some legislation, which takes
          notes of his antecedents, but so long as the action taken
          against him is after the Act comes into force, the statute
          cannot be said to be applied retrospectively."'

D      15. The most concrete cases wherein laws are made
  retrospective are those in which the date of commencement is
  earlier than enactment, or which validate some invalid law,
  otherwise, every statute affects rights which would have been
  in existence but for the statute and a statute does not become
E a retrospective one because a part of the requisition for its
  action is drawn from a time antecedent to its passing. Applying
  that to the present case, the conclusion is inescapable, that
  Rule 25(2) is not retrospective. All that Rule 25(2) does is that
  it operates in future, though the basis for taking action is the
F factum acquiring a plot in the past. Thus when by virtue of Rule
  25(2), a member is deemed to have ceased to be a member
  of the society, the cessation operates from April 2, 1973, when
  the rules came into force.

    Issue II
G
         16. Coming to the second question of applicability of bye-
    laws, the same came into force on 3.10.1962. The eligibility
    conditions for enrollment as a member of the society were
    provided in chapter Ill of the said bye-laws. Bye-law No. 8 (vii)
H
 ISHWAR NAGAR COOP.HOUSE BUILDING SOCIETY v. 987
PARMA NANO SHARMA [DR. MUKUNDAKAM SHARMA, J.]

which provides for cessation of membership is reproduced is         A
reproduced herein under:

    "8. A person ceases to be a member:

    (vii) On undertaking the business of purchase and sale of
    houses or land for construction of houses either directly or    B
    indirectly or on purchasing a house or a plot of land for
    construction of houses either in his own name or in name
    of any of his dependants through any other source and the
    member shall, within one month of his undertaking the said
    business or purchase of a house or a plot of land shall         c
    inform the society about this."

     17. Perusal to above bye-law makes it clear that on
purchasing a house or a plot of land for construction of a house,
either in his own name or in name of any of his dependants,         D
disqualifies a member of the society to continue as one. Bye
laws of the society regulate the management of the society and
govern the relationship between society and members inter se.
They are of the nature of Articles of Association of a company
registered under the Companies Act. If they are consistent with
                                                                    E
the Act and Rules, the members are bound by them. In
Zoroastrian Coop. Housing Society Ltd. v. District Registrar,
Coop. Societies (Urban), reported at (2005) 5 SCC 632, at
page 661 :

    "36. if the relevant bye-law of a society places any            F
    restriction on a person getting admitted to a cooperative
    society, that bye-law would be operative against him and
    no person, or aspiring member, can be heard to say that
    he will not be bound by that law which prescribes a
    qualification for his membership."                              G

     18. Bye-law 8(vii) was neither inconsistent with the Bombay
Cooperative Societies Act, 1925 under which the appellant
society was governed nor was it contrary to Delhi Cooperative
Societies Act, 1972 and the Rules framed thereunder.
                                                                    H
    988    SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A Therefore, a member of the society who acted in violation of
  the said bye law was liable to have his or her membership
  removed from the appellant-society.

       19. However, the learned counsel for the Respondent-1
  contended that the appellant-society never communicated to the
8
  Respondent-1, as to violation of bye law 8(vii). No
  correspondence made by the appellant-society to the
  respondent 1 mentioned the said bye law 8(vii), but mentioned
  only the violation of bye law S(i;{e) and Rule 25 wherein bye
C law 5(i){e) prescribes to be member of the society and is not
  applicable to the person who has already become member
  before the adoption of the bye laws. Further, the learned
  counsel for the respondent-1 contended that during the
  adjudication of the Writ Petition, the appellant never raised the
  ground of the violation of bye law 8 (vii) and even the Special
D Leave Petition filed by the appellant does not mention the said
  bye law 8(vii) either in list of dates or in the Question of Law or
  in Grounds. It was only for the first time on 22.09.10 during the
  course of oral arguments the learned counsel for the appellant
  raised the said violation as a surprise. On further investigation
E apart from the fact that the alleged 1962 bye laws were not part
  of the High Court file and the copy of the bye laws relied upon,
  it was contended, appears to be fabricated.

        20. If we accept the above contention of respondent-1 and .
F keep aside the alleged bye law 8(vii) from our consideration,
  bye law S(i)(e) still remains to be considered, the existence of
  which is also not in doubt. The violation of said bye law 5(i)(e)
  was also communicated to the respondent-1 by show cause
  notice dated 24.1.1978 and also raised as a ground in the writ
G petition before the High Court and in the SLP filed before this
  Court. The said bye law 5(i){e) is produced hereinunder:

          "5(i) Any person shall be eligible to be a member of the
          society, provided;

H         (e) he or his wife (she or her husband incase of a woman)
    ISHWAR NAGAR COOP.HOUSE BUILDING SOCIETY v. 989
   PARMA NANO SHARMA [DR. MUKUNDAKAM SHARMA, J.]

       or any of his/her dependents does not own a dwelling              A
       house or a plot for building a house in Delhi;"

       21. The question for our consideration is what is the
  meaning of the expression "eligible to be a member" used in
  the 1962 bye law No. 5(i)(e). The verb "be" has two meanings,          B
  namely, (a) to exist, and (b) to become. The former refers to
  the existence of state of affairs in present while the latter refers
  to the coming into existence of a new state of affairs. It is argued
  for the respondent-1 that the 1962 bye-law No. 5(i)(e) refers
  only to the eligibility of a person to become a member. On the         C
  contrary, the respondents have urged that even a person who
  is already a member ceases to be eligible to continue as a
  member if he does not satisfy bye-law 5(i)(e). That is to say, if
  a person after becoming a member of the society purchased
  a dwelling house in Delhi, then he is not eligible to be a member
  in the sense that he is not eligible to continue to be a member        D
  of the society under the said bye-laws. As against the
  contention of the respondent-1 that bye-law 5(i)(e) does not
  apply to existing members, it may be pointed out that in
  Article 102(1) of the Constitution also the word "be" is used in
  the sense of "exist" as contrasted to "become". Under                  E
  Article 102(1) a person is disqualified for "being chosen as" and
   also for "being a member of either Houses of parliament" etc.
  The dichotomy there is between becoming a member and
   continuing to be a member of parliament. It is therefore, to be
1
  concluded    that even under the 1962 bye-law No. 5(i) (e) the         F
· respondent-1 were disabled from continuing to be members of
  the society.

   Issue Ill

       22. The next argument for the learned counsel for the             G
   respondent-1 was that the said property was purchased in the
   name of HUF and not by respondent-1 in his personal capacity.
   Whereas the learned counsel for the appellant contended that
   the Rule 25 is applicable to the respondent-1 irrespective of
                                                                         H
    990     SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A the fact that the said property is purchased in the name of HUF.
  We have considered these arguments in the light of the Rule
  25. Sub-rule (1 )(c)(i) of the rule 25 provides an exception in
  case of persons who are only co-sharers in the joint family
  property, in that disqualification of membership as laid down
B 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. m. (80 yds) of
  land. In the present case, the said property is admeasuring
  1080 yds and there are 3 co-sharers of the property, i.e.
  respondent-1 and his two children, (after the death of wife) and
c the share of the respondent-1 would be more than the
  prescribed limit. In this regard, the aforesaid exception is not
  applicable to the respondent-1 's case. There is one more
  angle, which was specifically placed before us and requires our
  consideration. A perpetual lease deed with respect to the land
D allotted to the appellant society was executed on 06.04.1978
  by the President of India through the Delhi Administration. A
  copy of the said perpetual lease deed executed with the
  appellant society is placed on record. Our specific attention
  was drawn to clause No. 5 (a) of the said lease deed, which
  reads as follows:
E
          "5(a). The lease shall sublease within one year from the
          date of execution of these present, such time and on such
          premium and yearly rent as may be fixed by the lessor, one
          residential plot to each of its members who or whose wife/
F         husband or any of his/her dependent relatives including
          unmarried children does not own, in full or in part, on
          freehold or leasehold bases, any residential plot or house
          in the urban areas of Delhi, New Delhi or Delhi
          cantonment, and who may be approved by the chief
G         commissioner."

         The appellant society was, therefore, under an obligation
    not to allot a residential plot to a person, who was owning a
    property in the city of Delhi. Therefore, as per terms of allotment
    of the land to the appellant it was obligatory for the society not
H
  ISHWAR NAGAR COOP.HOUSE BUILDING SOCIETY v. 991
 PARMA NANO SHARMA [DR. MUKUNDAKAM SHARMA, J.]

to allot plots of land to such persons who own any residential        A
property either in their own name or in the name of their family
member. When the Hindu Undivided Family of the respondent
consists only of his own family members, namely, his wife, son
and the daughter and therefore obviously ownership of the said
property by the Hindu Undivided Family of the respondent is           B
ownership of property by the family members and consequently
the same would ~!early fall within the prohibition and bar of
allotment as contained in clause No. 5 (a) of the lease deed.

Issue IV
                                                                      c
      23. The last submission made by respondent-1 is that the
said property is being used only for the purpose of running a
nursing home, i.e., for a commercial and not residential
purpose. The learned counsel for the appellant-society refuted
the same contending that the nursing home was located only            D
on the ground floor of the property and the other floors are being
used for residential purpose and the same appears from the
various correspondences and affidavits made by the
respondent-1 wherein he has shown the said property as his
residence. In light of Rule 25, the action of the appellant-society   E
would be justified if the said property is found to be residential
house in the light of documents on record. The mere fact that
the respondent-1 has shown in affidavits and correspondences
the said property as his address doesn't prove that the property
is a residential house as being a doctor running a nursing home,      F
he had to remain invariably in his workplace for very long hours.
However, the Annexure P-12 and P-13 are respectively self-
assessment property tax forms filled by the respondent-1 with
respect to the said property and an objection letter written by
the respondent-1 against the assessment notice issued by the          G
Municipal Corporation with respect to the said property. In
Annexure P-12, while assessing the tax of the property, the
respondent-1 has shown the property as used for residential
and self-occupied purpose only. In Annexure P-13, the
respondent-1 opposed the assessable value shown in the
                                                                      H
    992    SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A assessment notice on the ground that the building on the said
  plot is a new constructed building and is under self-occupation
  for residence and self professional-medical work only and is a
  single-unit house. The respondent for the purpose of being
  member of the appellant-society cannot claim the said property
B used purely for commercial purpose when he himself claimed
  the said property being used for residential purpose also. It
  should also be indicated that the aforesaid information about
  the nature and status of his property in Kailash Colony were
  furnished by the respondent under his own declaration a.nd by
c certifying that the said particulars filled in the form are true and
  correct to the best of his knowledge. The respondent No. 1 has
  also appended his signature to the said declaration by signing
  it on 27/06/2006. These informations are relevant and material
  to come the conclusions that the aforesaid property in Kailash
  Colony was also used as a residential property and therefore
0
  tfle contention of the counsel for the respondent no. 1 that it is
  exclusively a commercial property cannot be accepted.

       24. We have considered the facts and circumstances of
  the case, and analysed the arguments put forth by both parties
E to buttress their stand. For the reasons that we have considered
  herein and mentioned above, we find that the arguments raised
  by respondent-1 are without merit, and the appeal therefore,
  is to be allowed.

    D.G.                                           Appeals allowed.