Supreme Court Upholds Allotment of Commercial Plot: Velagacharla Jayaram Reddy vs. M.Venkata Ramana (2022)

Date of the Judgment: 11 January 2022

Citation: 2022 INSC 28

Judges: N.V. Ramana, CJI; A.S. Bopanna, J; and Hima Kohli, J.

Can a cooperative society member be denied a plot that was allotted to him, based on the claim that the plot is a parking area, when the layout plan does not specify the same? The Supreme Court of India recently addressed this question in a case concerning a dispute over a plot allotment in a cooperative society layout. The core issue was whether a plot designated for commercial use could be reclassified as a parking area based on assumptions, without any clear demarcation in the original layout plan. The Supreme Court bench, comprising Chief Justice N.V. Ramana and Justices A.S. Bopanna and Hima Kohli, delivered the judgment, with the opinion authored by Justice A.S. Bopanna.

Case Background

The Government of Andhra Pradesh allotted land to the N.G.O. Cooperative Building Society Ltd. in 1970 for developing a layout and allotting plots to its members. This land was located in Sy.No.752/2 and 91/1, near the Kondayapalli Tank bund. Initially under the jurisdiction of Chinnachowk Gram Panchayat, the area later came under the Municipal Corporation of Kadapa. A layout was formed, and 625 plots were allotted to members, including areas for parks, playgrounds, schools, religious places, shopping areas, and parking. The dispute arose concerning a 3.2-cent plot allotted to Mr. M.V. Ramana, the respondent in Civil Appeal No. 11015/2017.

Timeline:

Course of Proceedings

The dispute was initially raised before the Divisional Co-operative Officer, Cuddapah, under Section 61(1)(b) of the Andhra Pradesh Co-operative Societies Act, 1964 (APCS Act). The plaintiffs, including a Welfare Association, former office bearers of the N.G.O Society, and shop owners, claimed that the plot allotted to Mr. M.V. Ramana was reserved for parking. The Divisional Co-operative Officer, acting as an Arbitrator, ruled in favor of the plaintiffs on 28 January 2004, terming the plot a ‘parking area’. This decision was upheld by the Andhra Pradesh Co-operative Tribunal on 27 February 2006. However, the High Court of Judicature, Andhra Pradesh at Hyderabad, overturned these decisions on 20 April 2010, leading to the current appeal before the Supreme Court.

Legal Framework

The case primarily revolves around Section 61 of the Andhra Pradesh Co-operative Societies Act, 1964. This section outlines the types of disputes that can be referred to the Registrar for decision. The relevant portion of Section 61 is as follows:

“61. Disputes which may be referred to the Registrar: –
(1) Notwithstanding anything in any law for the time being in force, if any dispute touching the constitution, management or the business of a society, other than a dispute regarding disciplinary action taken by the society or its committee against a paid employee of the society, arises–
(a) among members, past members and persons claiming through members, past members and deceased members; or (b) between a member, past member or person claiming through a member, past member or deceased member and the society, its committee or any officer, agent or employee of the society; or (c) between the society or its committee, and any past committee, any officer, agent or employee, or any past officer, past agent or past employee or the nominee, heir or legal representative of any deceased officer, deceased agent or deceased employee of the society; or (d) between the society and any other society, such dispute shall be referred to the Registrar for decision.”

This provision allows members of a Co-operative Society to approach the designated Co-operative Officer when disputes arise among members or between a member and the society.

Arguments

Appellants’ Submissions:

• The appellants, including former office bearers of the N.G.O Society and members of the Jayanagar Housing Welfare Society, argued that the plot allotted to Mr. M.V. Ramana was originally designated as a parking area in the layout plan.
• They contended that the allotment of the plot to Mr. Ramana was illegal and sought a declaration that the sale deed dated 07.04.2000 was null and void.
• They claimed that the plot was essential for the convenience of the shop owners and visitors in the commercial area.
• The appellants relied on the observations made by the Sub-Divisional Cooperative officer in the defect sheet that the society sold away site for parking place.

Respondents’ Submissions:

• Mr. M.V. Ramana, the allottee, argued that the plot was a vacant commercial plot as per the layout plan and was validly allotted to him by the society.
• He submitted that he was a member of the society and had surrendered his earlier plot to get the present allotment.
• He contended that the plaintiffs, particularly the shop owners, were rival claimants who had tried to purchase the plot themselves and were not genuinely interested in maintaining it as a parking area.

Sub-Submissions Categorized by Main Submissions:

Issues Framed by the Supreme Court

The Supreme Court addressed the following issues:

1. Whether the plot in question was designated as a parking area in the layout plan.
2. Whether the allotment of the plot to the respondent (Mr. M.V. Ramana) was valid.
3. Whether the proceedings initiated under Section 61 of the APCS Act were maintainable by the plaintiffs.

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues:

Authorities

The Court considered the following:

Legal Provisions:

• Section 61 of the Andhra Pradesh Co-operative Societies Act, 1964: This section deals with disputes that can be referred to the Registrar.
• Rule 42(4) of the Society Rules: This rule relates to the procedure for allotment of plots by the society.

Authorities Considered by the Court:

Judgment

How each submission made by the Parties was treated by the Court?

How each authority was viewed by the Court?

• The Court examined Section 61 of the Andhra Pradesh Co-operative Societies Act, 1964* to determine if the dispute fell under its ambit.
• The Court referred to Rule 42(4) of the Society Rules* to assess the procedure followed for the allotment of the plot to the respondent.

The Supreme Court dismissed the appeals, upholding the High Court’s decision. The Court reasoned that the plot was not designated as a parking area in the layout plan and that the allotment to Mr. M.V. Ramana was valid. The Court also noted that the plaintiffs, particularly the shop owners, were rival claimants and not genuinely interested in maintaining the plot as a parking area.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the following:

• Lack of Evidence: The Court emphasized that there was no concrete evidence in the layout plan to designate the plot as a parking area. The Divisional Co-operative Officer’s conclusion was based on an assumption, not on any documentary proof.
• Valid Allotment: The Court noted that the allotment to Mr. M.V. Ramana was made to a member of the society, following the due procedure. The non-availability of the General Body resolution at this juncture, as observed by the Learned District Judge, cannot be held to be fatal.
• Rival Claimants: The Court observed that the shop owners who were the plaintiffs, were rival claimants who had tried to purchase the plot themselves. Their claim of wanting to maintain it as a parking area was not considered credible.
• Clean Hands Doctrine: The Court pointed out that the plaintiffs did not approach the court with clean hands, as they had attempted to secure the same plot for themselves.
• No Modification of Layout Plan: The Court was of the view that the Divisional Co-operative Officer had modified the approved layout plan by terming the plot as a ‘parking area’.

Sentiment Analysis of Reasons Given by the Supreme Court:

Fact:Law Ratio:

Logical Reasoning:

The Court considered the argument that the plot was a parking space but found no evidence to support it, noting that the Divisional Co-operative Officer’s finding was based on an assumption. The Court also considered the fact that the respondent was a member of the society and the procedure was followed for the allotment. The Court rejected the argument that the sale deed was null and void. The Court also considered the fact that the appellants were rival claimants and had tried to purchase the plot themselves. The Court concluded that the appellants were not genuinely interested in maintaining it as a parking area. The Court, therefore, dismissed the appeals.

“There is no such document on record.”

“Secondly, the person seeking relief from the Court should approach the Court with clean hands, as per well-established legal norms.”

“Therefore, taking a holistic view of the matter, the appeals are dismissed with no order as to costs.”

Key Takeaways

• Layout plans must clearly demarcate areas for specific purposes, such as parking, to avoid disputes.
• Assumptions or personal interpretations cannot override the actual layout plan.
• Parties seeking relief from the court must approach with clean hands and genuine intent.
• Allotments made to members of a cooperative society, following the due procedure, are generally upheld.
• Cooperative officers cannot modify the approved layout plan.

Directions

No specific directions were given by the Supreme Court in this judgment.

Specific Amendments Analysis

There is no specific amendment analysis in this judgment.

Development of Law

The ratio decidendi of this case is that a plot designated as a commercial area in a layout plan cannot be reclassified as a parking area based on assumptions or interpretations without clear demarcation in the plan. The judgment reinforces the importance of adhering to the original layout plan and the need for parties to approach the court with clean hands. There is no change in the previous position of law.

Conclusion

The Supreme Court dismissed the appeals, upholding the High Court’s decision. The Court held that the plot allotted to Mr. M.V. Ramana was a commercial plot as per the layout plan, and there was no evidence to support the claim that it was a parking area. The Court also noted that the plaintiffs were rival claimants and did not approach the court with clean hands. The judgment emphasizes the importance of clear documentation in layout plans and the need for genuine intent in disputes.

Category

Parent Category: Cooperative Society Law

Child Categories:

• Disputes in Cooperative Societies
• Allotment of Plots
• Section 61, Andhra Pradesh Co-operative Societies Act, 1964
• Layout Plans
• Parking Area Disputes

FAQ

Q: What was the main issue in this case?

A: The main issue was whether a plot of land in a cooperative society layout, designated as a commercial area, could be reclassified as a parking area based on assumptions and without clear demarcation in the layout plan.

Q: What did the Supreme Court decide?

A: The Supreme Court dismissed the appeals and upheld the High Court’s decision. The Court held that the plot was a commercial plot as per the layout plan and that the allotment to the respondent was valid.

Q: What does this mean for cooperative societies?

A: This means that layout plans must clearly demarcate areas for specific purposes, and assumptions cannot override the actual plan. Allotments made to members following due procedure are generally upheld.

Q: What is the significance of the “clean hands” doctrine in this case?

A: The “clean hands” doctrine means that parties seeking relief from the court must have acted honestly and fairly. In this case, the plaintiffs had tried to purchase the plot themselves, which the court considered a lack of genuine intent.

Q: Can a cooperative officer modify the approved layout plan?

A: No, a cooperative officer cannot modify the approved layout plan. The court was of the view that the Divisional Co-operative Officer had modified the approved layout plan by terming the plot as a ‘parking area’.