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Petitioner: SHAIKH HAIDER VS Respondent: GOVERNMENT OF SIND AND 4 Other
Court Name: Sindh High Court Judge(s): Ajmal Mian, B. G. N. Kazi Title: SHAIKH HAIDER vs GOVERNMENT OF SIND AND 4 Other Case No.: Constitutional Petitions Nos. D-1346 and D-1360 of 1980 Date of Judgment:1981-09-01 Reported As: PLD 1982 Karachi 336 Result: Petitions dismissed
JUDGMENT
JUDGMENT B. G. N. KAZI, J.-Both these petitions are by members of Bahadur Yar Jang Co-operative Housing Society Ltd. And seek quashment of award dated 30-5-1974 of nominee of Registrar, Co-operative Societies in favour of another member of the Society who is named as respondent in both the petitions ; the order in appeal of Deputy Registrar exercising powers of Registrar dated 14-4-1977 and the order in Revision passed by the Secretary Co-operation, Government of Sind dated 4-8- 1980 in respect of allotment of Plot No. 380 in Block III measuring 576 square yards in the aforementioned Co-operative Housing Society in Karachi. As orders impugned in both the petitions are the same and most of the questions of law raised are common to both the petitions, it is convenient to dispose them of together. The material facts in each of the cases are substantially the same and are being narrated in chronological order. Respondent Mr. Haqqani was enrolled as member of the Bahadur Yar Jang Housing Society (hereinafter referred to as the Society) on 20-3-1949. Mr. Shaikh Haider petitioner in C. P. No. D-1346 and Mr. S. Mahmud Hussain petitioner in C. P. No. D-1360 were enrolled as members of the Society on 30-3-1949 and 25-3-1949 respectively. According to shares held by him, Mr. Haqqani was entitled to allotment of a plot measuring 600 square yards. His claim was consistently overlooked and plots of similar area were allotted to other members who had joined the Society later. In the year 1954 the Society got prepared separate lists of members eligible for allotment of plots in Blocks 111, VII and VIII respectively, and the name of Mr. Haqqani appeared in the list of Block III at S. No. 41, and that of Mr. Mabmud Hussain in the list of Blocks VII and VIII ; whereas the name of Shaikh Haider did not appear in any list. The explanation for this omission has been mentioned in the impugned order of the Deputy Registrar dated 14-4-1977 when dealing with the factual position.
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The impugned orders are based on facts mentioned therein specially these not denied and at this stage, for obvious reasons, the same can be considered while assessing the legality or otherwise of the impugned orders. It is mentioned that when Mr. Shaikh Haider was Honorary Secretary of the Society a Plot No. 43 in Block III was allotted to him, but he failed to deposit development charges despite notices and as such the allotment of the same plot was cancelled. As he had failed to avail of the opportunity given his name was not included in the eligibility list. Mr. Haqqani raised a dispute A. B. N. 59/1956 before the Registrar, Co-operative Societies, Karachi under section 54 of the Bombay Co-operative Societies Act, 1925 (VII of 1925) (hereinafter referred to as the Act) which was referred by the Registrar for decision to his nominee who gave award .In favour of Mr. Haqqani on December 27, 1956 directing that Plot No. 36 in Block III which had earlier been allotted to one Mr. Mehdi be allotted to Mr, Haqqani. The matter came up in appeal before the Registrar who modified the award directing the Society to allot a plot measuring 600 square yards in Block No. III to Mr. Haqqani without specifying the same as No. 36 in Block No. 111. The aforesaid decision was confirmed in Revision under section 64-A of the Act by the Chief Commissioner on 16- 7-1957. On 29th May, 1961 the Managing Committee of the Society declared that Plot No. 3W in Block No. III had fallen vacant. On the very day Mr. Shaikh Haider applied for allotment of the plot and the Managing Committee completed all formalities the same day and allotted the plot to him, in spite of the fact that earlier Mr. Shaikh Haider was allotted Plot No. 488 in Block No. III and after its cancellation, commercial Plot No. 458. On 26-10-1971, therefore, Syed Mahmud Hussain (petitioner in C. P. D. 1360 of 1980) invoked arbitration under section 54 of the Act which is No. AB-278 of 1961 and was referred to his nominee by the Registrar. An interim order for maintenance of status quo was passed in the course of the proceedings directing Mr. Shaikh Haider not to build upon the disputed plot. Mr. Haqqani had also moved the Registrar complaining that the Society had not implemented the award given in his favour as far back as December 27, 1956. A report was called for from the Society and the Managing Committee of the Society passed the following resolution "If the stay order given in the proceedings initiated by Mahmud Hussain is vacated, the Society proposes to allot Plot No. 380 in Block No. III to Mr. Haqqani." The Registrar approved the Resolution and simultaneously ordered that the reference made by him to his nominee in the dispute raised by Mahmud Hussain be cancelled, as due to the resolution of the Managing Committee it had become obsolete. The Managing Committee, therefore, cancelled the allotment of the plot in favour of Mr. Shaikh Haider on 29-5-1961. Mr. Shaikh Haider (petitioner in C. P. No. D-1346 of 1980) challenged the order in ?Writ Petition No. 398 of 1962 which was allowed by a Bench of the erstwhile High Court of West Pakistan on 8-11-1956 quashing the order of the Registrar dated 29-5-1962. The High Court, while setting aside the order of the Registrar held that he was not competent in law to cancel the arbitration proceedings which he bad earlier entrusted to his nominee under section 54 of the Act. Against the aforesaid decision of the High Court of West Pakistan, Karachi dated 8th November, 1965 the Registrar, Co-operative Societies, Karachi filed appeal before the Supreme Court which was dismissed on the ground that it was pointed out that the Registrar in the counter affidavit filed by him. In the High Court had specifically taken up the position that there was no dispute between Shaikh Haider and Mr. Haqqani nor had any such dispute been referred to arbitration, and that his order was not based on any reference in any fresh arbitration proceedings. It was, however, observed by the Supreme Court as under;-- "On hearing Mr. Usman Ghani, we are inclined to hold that the Registrar was competently seized with the dispute raised before him by Mr. Haqqani under section 54 of the Bombay Co-operative Societies Act and that he could in the course of those proceedings, direct that the allotment of Plot No. 380 from the name of Mr. Shaikh Haider be cancelled and the same plot be allotted to Mr.
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Haqqani. Mr. Shaikh Haider would have been bound by that order as he had on his own application joined issue with Mr. Haqqani before the Registrar and was heard before the impugned order was made. As the plot was to be allotted to Mr. Haqqani, the reference made by the Registrar to his nominee for adjudicating upon the claim by Mahmud Hussain was rendered abortive. The Registrar could, therefore, cancel those proceedings in exercise of powers ancillary to section 54 of the Bombay Co-operative Societies Act." The Supreme Court, while dismissing the appeal directed as under;-- "The Registrar shall now proceed to dispose of the dispute raised before him by Mr. Haqqani under section 54 of the Bombay Co-operative Societies Act in accordance with law." Mr. Haqqani had already filed an application under section 54 before the Registrar Co-operative Societies which is A. B. No. 143/73 and the Registrar appointed his nominee and disputes in both the matters, namely A. B. No. 278/61 and A. B. No. 143/73 were referred to him for decision. The nominee gave his award in favour of Mr. Haqqani and both the petitioners in C. P. D-1346 and C. P. D-1360 of 1980 preferred appeals which were dismissed by the Deputy Registrar exercising powers of Registrar. Both the aforesaid peti--tioners also filed Revision Applications before the Secretary, Co- operation, Government of Sind who disposed of the same by his order dated 4-9-1980 dismissing both the Revision Applications and upholding the award passed by the nominee of the Registrar and the orders of Deputy Registrar, Co-operative Societies, Karachi dated 14-4-1977: As already stated, these two petitions have now been filed for quashment and declaration that the impugned orders are illegal, ultra vires and of no effect in law. The learned counsel for the petitioners have raised the following con--tentions; (i) That in view of the earlier reference of dispute in A. B. No. 59 of 1956 which was in respect of. Plot No. 36 in Block III only between Mr. Haqqani and the Society and decision of which had been merged into the appellate order of the Registrar and the order of the Revisional Authority, Mr. Haqqani only had the right to get the aforesaid orders enforced and could not, therefore. File a second arbitration. (2) That the second arbitration was in the nature of execution of award which being against the Society could not have been executed against the petitioners. (3) That on allotment of the plot to Mr. Shaikh Haider by the Society, since in the sub-licence issued in his favour, the Government of Pakistan and the Karachi Co-operative Housing Societies' Union were mentioned as parties, section 54 of the Act does not come into play. (4) That under rule 32 of the Co-operative Housing Societies Rules, 1927 when a dispute has been referred to the Registrar under section 54 the Registrar or his nominee had to issue notice to all parties and each of the parties had the right to nominate an arbitrator. The failure in the instant case of the petitioners to appoint their own arbitrators has seriously prejudiced them. Mr. Shah Yakoob for petitioner in C. P. D-1360 of 1980 has also raised the following additional contention: (5) That the dispute raised by Mr. Syed Mahmud Hussain in A. B. No. 278 ; which was referred for decision on 8-9-1973 has not been decided in the impugned orders. Before dealing with the above-mentioned contentions it is observed that before the relief prayed for in these petitions can be granted, jurisdictional defects as distinguished from a mere erroneous decision, have to be made out, and further, that the facts, as stated in the impugned orders specially when the same have not been disputed can be considered to assess the legality or otherwise of the impugned orders. Contentions Nos. 1 and 2.-With regard to Contention No. 1, it is obvious, after perusal of the facts that although Mr. Haqqani was eligible for allotment of plot and had acquired the requisite number of shares for grant of plot measuring 600 square yards, the Society had persisted in overlooking his claim and had allotted plots to others and, therefore, it was necessary for him to refer the dispute
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against the Society under section 54 of the Act. The dispute was referred for decision to nominee of the Registrar as A. B. No. 59 of 1956. The dispute was decided in his favour by directing the Society to allot a plot of 600 square yards in Block No. III to him. However, since the needful had not been done and there was again a case in which Plot No. 380 in Block No. III bad been allotted to a person who was, according to Mr. Haqqani, and also as later adjudged by the authorities concerned not eligible for the allotment, there was fresh cause for yet another dispute which was rightly raised . And referred under section 54 of the Act for decision. Whereas the earlier dispute was with regard to his eligibility for allotment of a plot of requisite area which was being over--looked, the other dispute was with regard to a specified plot over which, according to him, be had a better claim for allotment. There is no limit to the number of dispute which could be referred under section 54 of the Act. Moreover, the fact about the two disputes raised under section 54 having been referred was in the knowledge of the High Court .And the Supreme Court, and the fact that the Supreme Court was pleased to direct that the Registrar should proceed to dispose of the dispute raised by Mr. Haqqani in accordance with the law shows that either the point was not raised or in any case it was not considered to invalidate the reference which the Registrar had been directed to dispose of in accordance with law. For the reasons already given, the contention that the second reference should be considered as a matter of execution of the first award cannot be accepted. Contention No. 3.-The point does not appear to have been taken before the authorities whose orders are being impugned. It is also clear that no such point was taken before the High Court or the Supreme Court. With regard to eligibility of Mr. Shaikh Haider for allotment of the plot and the actual allotment by the Society all the authorities have given finding that the allotment was invalid and improper. While quashing the impugned order of the Registrar the High Court observed as under "In these circumstances we would quash the impugned order and leave the respondents to pursue such legal remedy as may be available to them to get rid of the allotment made to the petitioner of the plot in dispute." It is, therefore, quite clear that from the very outset it was apparent to the authorities concerned that the allotment in favour of Mr. Shaikh Haider was improper and invalid, if not illegal. The Registrar in his order dated 29th May, 1962 had observed, after hearing Mr. Shaikh Haider, and the representative for the Society that the allotment of Plot No. 380 in favour of Mr. Shaikh Haider was illegal as it was done in clear violation of the decree and directions issued from his office and that of the Commissioner, Karachi. He had, therefore, approved the proposal of the Committee cancelling the allotment of the plot in favour of Mr. Shaikh Haider. With regard to the contention that since in the sub-licence issued in favour of Mr. Shaikh Haider, the Government of Pakistan and the Karachi Co-operative Housing Society Union are mentioned as parties, section 54 of the Act does not come into play ; Mr. Iqbal Kazi, the learned counsel for petitioner Shaikh Haider has relied upon the decision in Azizuddin Ahmad v. Azfz Ahmed and others PLD 1959 Kar. 497The facts of that case were different as the allotment under the Rules had merged in a lease for 99 years granted by Government of Pakistan, the lease deed having been duly signed on behalf of the Government. In the instant case there was only the sub-licence issued and signed only on behalf of the Society as Sub licence No. 1. The Sub--licence No. I under condition No. 3, if the declaration forming Annexure I to the sub-licence turned out to be false, and the Sub- licence No. 1 had the right to terminate the Agreement. Annexufe I aforesaid inter alia mentions that the Sub-licence No. 2 was not a lessee or allottee of any plot. On the material on record it is apparent that declaration in the Annexure I was wrong. It is apparent that some plots had already been allotted to Mr. Shaikh Haider. Mr. Usman Ghani Rashid, the learned counsel for respondent has drawn our attention to documents which indicate such allotments. There is true copy of application of Mr. Shaikh Haider for which withdrawal of Rs. 900 from the amount deposited on call up of
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development charges dated 25-7-1952. There is also declaration made by Mr. Shaikh Haider dated 14-1-1959 showing deposit inter alia of Rs 900 paid towards develop--ment charges which amount was withdrawn. Our attention has also been invited to true copy of note of office of Registrar showing that on an applica--tion dated 25-7-1952 for refund of Rs. 900 from the amount deposited by him as development charges the Managing Committee had allowed Rs. 900 to be paid to him on condition that the amount would be re-deposited within two months, but Mr. Shaikh Haider failed to abide by the resolution of the Managing Committee and so his Plot No. 43 of 600 square. Yards was cancelled under Managing Committee's Resolution dated 13-1-1953. There is also a true copy of Letter No. BYJ CH-MPF-LF-564/500 dated 26th July, 1952 which shows that Mr. Shaikh Haider had been allotted a plot measuring 581 square yards in Bahadurabad No. 1 and was requested to remit Rs. 2,100 on or before 10th August. 1959, otherwise the plot would be allotted to another senior member of the Society eligible therefor. It is also contended on behalf of Mr. Haqqani that both the High Court and the Supreme Court had directed that the matter, before the Registrar be decided and, therefore, it is obvious that objection as ,regards maintainability of the reference had not been taken at the initial stage. He further pointed out that preliminary objections were filed on 19-6-1973 to which reply was made on 17-7-1973 and written statement was filed by Mr. Shaikh Haider on 17- 7-1973 and even till the framing of consent issues the point with regard to non-maintainability of the reference was not made ; therefore, it is not now open to the petitioner to take the objection. With regard to the mala fides of the action resulting in the issue of the sub-licence it has been pointed out that the Secretary of the Society addressed letter dated 13th June, 1961 to Mr. Shaikh Haider informing him that it was proposed to allot a plot in Bahadurabad No. 1 of 576 square yards and if he was interested in exercising his rights to take up the plot, he should remit Rs. 712 to the Society on or before the 30th June, 1961. But the sub-licence was executed on 15-6-1961 in respect of Plot No. 380 in Block No. 111, although the formal allotment of the plot was mentioned in the letter dated 21-6-1961 addressed to Mr. Shaikh Haider. It is, therefore, contended that the action in the issue of the sub-licence on 15-6-1961 even before the issue of formal allotment orders on 21-6-1961 was altogether against the rules of the Society and, therefore, the termination of licence by resolution of the Working Committee was legal and proper. With regard to the contention that under the Co-operative Housing Society Rules, 1927 notice had to be issued to all parties and each of the parties had the right to nominate an arbitrator since the dispute was touching the business of the Society, under section 54 it was required to be referred to the Registrar for decision by himself or his nominee or if either of the parties so desired to arbitration of three arbitrators who shall be the Registrar or his nominee and two persons of whom one shall be nominated by each of the parties concerned. In the instant case, the dispute was referred to the Registrar and by him to his nominee who issued notice under rule 32 of the Co- operative Societies Rules under which if either of the parties desired that the matter be referred to arbitration, the Registrar or his nominee had to call on each party to nominate his arbitrator within 15 days. Notice dated 26th May, 1973 was issued and it is apparent that the desire that the matter be referred to arbitra--tion was not expressed within 15 days time. Most of the proceedings were complete. The point which was earlier raised before the nominee of the Registrar has been referred to in the impugned award under the heading "Appointment of arbitrators of the parties". It has been stated that on receipt of the order of reference the plaintiff (respondent herein) and the Society were called upon to appoint their arbitrators if they so desire under the provisions of rule 32 of the Co-operative Societies Rules, 1927, but both the parties did not indicate a desire to appoint their arbitrators within appointed time. The proceedings were, therefore, started by the nominee as the. Sole arbitrator on 19-6-1.973. . The contention that reference to arbitration was made without notice to parties and without declaration of principal party and that the Registrar's nominee had by himself illegally made the Society as principal party even though the disputed plot was held by
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defendant 2 (petitioner herein) who ought to have been declared as principal party was also considered, and was heard by the Deputy Registrar who heard all the parties concerned and conveyed his decision, that since the Registrar's nominee was seized of the matter the parties should agitate the point for declaration of principal party before him. But since the further contention that Registrar's nominee was not competent to give decision in the matter as under rule 32 it was the exclusive jurisdiction of the person exercising powers of Registrar to declare as to who is the principal party, the matter was again submitted to the Deputy Registrar for decision. It is apparent that the Society was rightly considered as the principal party as the dispute was by a member against the allotment made by the Society and in the dispute the remedy had been sought against the Society. The contention about declaration as principal party was late and it was rightly pointed out in the award that the belated application was obviously with intention to cause delay in the expeditious decision in the case and therefore the application was rejected. In any case, the matter was within the jurisdiction of the Registrar or person exercising the powers of Registrar, and the decision about the declaration of the principal parties cannot be challenged at this stage before this Court. The contention that the matter with regard to the reference of dispute of Mr. Syed Mahmud Hussain was not decided in the impugned orders would appear to have been misconceived as there is clear indication in the award about the fact that his right to the allotment of Plot No. 380 in Block III was con--sidered vis-a-vis the right of Mr. Haqqani. The matter about Syed Mahmood Hussain having no locus standi was considered and it was observed that he had never applied for plot of 600 square yards, but had only in the first instance applied for plot of 490 square yards. It was the further point made against him that he had not acquired the required number of shares on the date of allotment of Plot No. 380 in Block No. 111. It is also further clear from the award that the contention on behalf of Syed Mahmud Hussain that since the High Court and Supreme Court bad not determined any preferential right, but had left the matter to be determined according to law, and hence there was no question of preferential right, had been considered. The further claim that because he had invoed arbitration proceedings first and obtained stay orders and stopped construction on the plot he was entitled to Plot No. 380 was also considered. It was the contention on his behalf that Mr. Haqqani had invoked arbitration of the dispute four years later than him. The mere fact of invoking arbitration earlier, does not make any difference in preferential eligibility which is governed by the Rules and Bye--laws of the Society. The arbitrator, after hearing the arguments and examin--ing the various documents came to the conclusion that by virtue of orders in A. B. N. Case No. 59/1956 Mr. Haqqani was to be alloted a plot of 600 square yards in Block No. III and the Society was expected to comply with that order of the Chief Commissioner, Karachi within a reasonable time. The Society was, therefore, bound to allot the first available plot to Mr. Haqqani who was given preference over the other non-allottees, including Syed Mahmud Hussain. Discussing the provisions of section 17 of the Co--operative Societies Act it was observed in the award that section prohibits a person from exercising the rights of a member unless he has made such payments in respect of membership as are prescribed by the rules and bye-laws of the Society. It was found that Mr. Haqqani had been complying every time there was call up for purchase of shares by the Society and he was not a defaulter. The award reveals that all the relevant point with regard to preferential right of the three members were considered for adjudging the matter with regard to the right to the allotment of the plot in question. It was further observed that the application for damages -was not made by Mr. Haqqani in lieu of his claim of a plot in Block No. III, and that the Registrar's orders for compensation dated 14-10-1958 were not made under the provisions of any law. It was further observed that the Registrar could not give any fresh orders after the final orders in A. B. No. 59 of 1956 by the Chief Commissioner, Karachi. But however before
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Mr. Haqqani could submit his appeal against the illegal orders the Registrar himself passed another order dated 5-I1-1958 in a separate A. B. N. Case No. 96 of 1957 pertaining to Plot No. 423 in Block No. III measuring 933 square yards that the said plot be allotted to Mr. Haqqani. The new order therefore amounted to supersession of the previous…
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