K.K.RAMACHANDRAN Vs. SARASWATHY SUBBRAMAN

JUDGEMENT

(1.) These are two appeals against a common order of 8th October, 1992 passed by the State Commission of Karnataka at Bangalore in Complaint No. 169 of 1991 and Complaint No. 218 of 1991. The State Commission had directed Sarvshri K.K. Ramachandran and N. Krishnamurthy to refund the amount of Rs. 59,000 paid by each of the complainants to the Society along with compound interest @ 18% p.a. on the deposits made from time to time and Rs. 500 as costs.

(2.) The facts of the case are that a certain number of individuals got together in January, 1987 to form the Good Will Housing Co -operative Society Ltd. with a view to arrange for the construction of residential flats/apartments in Vijainagar. The society had a total membership of 96 in 1991. The society was however, not recognised or registered by the Registrar of Cooperative Societies. The members of the Society it appears, had appointed two members of the proposed Society, Shri K.K. Ramachandran as Honorary Secretary and Shri N. Krishna Murthy as Treasurer both of whom are the respondents in the above two appeals.

(3.) As per the first circular (undated) issued on behalf of the proposed Society to its members, after the registration of the Society every member would be required to sign an agreement that a Managing Committee to look after the project of construction of flats would be constituted, that the ownership of the site, on which the buildings would be put up, would vest in the society and a member will be the owner of the flat only, the architects to be appointed by the society would undertake the construction of buildings, according to the specifications drawn up by the Society. The task of acquiring the land and constructing buildings therein was entrusted by the Society (proposed) in May, 1987 to M/s. Builders Associates, a local firm of builders. At that time the cost of each flat was estimated as Rs. 205 per sq. ft. including the cost of the land. In December, 1988 the Bangalore Development Authority conveyed to the nominated builder (M/s. Builders Associates) the approval of the Development Authority acceding to its request for allotment of certain area of land in bulk for the specific group housing scheme in the Kembapura Agrahara of certain conditions. This sanction was rescinded by the Development Authority on 25th November, 1989 in the light of the decision of the High Court of Karnataka that the Bangalore Development Authority had no powers to make bulk allotment of land. The Registrar of Co -operative Societies on 2nd November, 1987 had informed the then Chief Promoter Shri K.S. Krishnaprasad of the proposed Good Will Apartments Cooperative Housing Society that the Society can be registered on fulfillment of certain conditions. On 5th March, 1990 however, it was further informed that the registration of the proposed housing Society could be done only after the ban of the registration of house building co -operative societies imposed by the State Government in 1985 was lifted or it was clarified by the Government that the same was not applicable to the said Society. The Chief Promoter Shri K.S. Krishnaprasad also wrote to the then Chief Minister of Karnataka Shri Virendra Patil on behalf of the Housing Society bringing to his notice that the Society did not receive recognition from the Registrar of the Cooperative Societies. A copy of this letter was also circulated among members of the Society on 11th August, 1990.