KAMAL VIHAR COOPERATIVE SOCIETY LIMITED Vs. MOHAN CHAND

JUDGEMENT

(1.) Petitioner society recommended the expulsion of as many as 46 members on account of their having committed persistent defaults against demands. The recommendations for expulsion of 45 members were approved by the Registrar vide order dated 26.3.1998 whereas the recommendation in respect of R-1 Mohan Chand did not find favour with him on the ground that R-1 had approached the Society way back in 1992 to complete the formalities for getting him loan advanced from the financial institutions but neither did the Society assist him in getting the necessary papers completed nor did it show any inclination to help him out and as a consequence he was burdened with huge interest on the principal amount Besides this, the Registrar also directed the Society to only collect the principal amount from R-1 after getting all the documents executed. As regards the interest the Registrar directed both the Society as well as R-1 to go for arbitration and settle the matter there. Feeling aggrieved the Society preferred the appeal but did not succeed.

(2.) On 21.5.1989 the Society took the decision for expelling R-1 and sent its recommendation to the Registrar for approval on 5.6.1989. When it did not receive any response for more than a year though Registrar ought to have granted or refused the approval of expulsion within period of six months, the Society sent reminder after reminder. It was only in November 1997 i.e. after about 8 long years that the Registrar woke up from deep sleep and put up the Society as well as R-1 on notice which culminated in the order dated 26.3.1989 and the impugned order.

(3.) Rule 40 of the DCS Rules provides that a member once enrolled by a Cooperative Society cannot be denied his membership..right except on resignation, transfer, death, removal or expulsion. Rule 36 contemplates expulsion if there has been persistent default in payment of dues or the payment of claims made by a housing Society for raising its funds to fulfil its objects. Relevant extracts are as under:- Rule 40 Cessation of Membership Without prejudice to the provisions of Section 27, a person shall cease to be a member of a co-operative society on his resignation from the membership there of being accepted or on the transfer of the whole of his share or interest in the society to another member, or on his death, removal or expulsion of incurring any of the disqualifications specified in the Act and the rules. Rule 36 Procedure for Expulsion of Members