IN THE HIGH COURT OF SINDH AT KARACHI 

(Constitutional Jurisdiction)

 

C.P. No.D-288 of 2006

 

                      Present:

                                   1)    Mr. Justice Munib Ahmed Khan and

                                   2)    Mr. Justice Farrukh Zia G. Shaikh

 

Date of Hearing              :     20/2/2008

 

Feroz Shamsi & Others, :    Through Mr. Amir Aziz Khan,

Petitioners                           Advocate.

 

Province of Sindh,          :    Through Mr. Fareed Ahmed Dayo,

Ministry of Cooperation,      AAG.

Through the Secretary

Cooperation, Sindh

Secretariat, Karachi,

Respondent No.1

 

Bahadur Yar Jung         :    Through Mr. Syed Iqbal Haider and

Cooperative Housing           Mr. Khalil A. Siddiqui, Advocates.

Society through its

Honorary Secretary,

Respondent No.2

 

Registrar, Cooperative    :    Mr. Imran Mehdi Memon, D.O.

Societies Sindh,                  Cooperative Societies, present in

Respondent No.3                person.

 

Messrs. Karachi             :     Through Mr. Ishrat Alavi, Advocate.

Cooperative Housing

Societies Union Ltd.,

Intervenor

                                       ---------------------------  

 

J U D G M E N T  

 

MUNIB AHMED KHAN, J.-  This petition has been directed against the order dated 10/9/2005 but reported on 14/5/2005 by the Minister Cooperation in a Revision No.SO(T)6(4)/2004.  Mr. Amir Aziz Khan, learned counsel for the petitioners has, first of all, clarified that there are some typographical mistakes in the petition in respect of dates of the order, therefore, it may be taken as mentioned above as the main grievance is against the order dated 10/9/2005.  He submits that there were short orders by the Minister Cooperation and thereafter recalling and then the hearing at a belated stage, therefore, some mistakes have been occurred which may be ignored. Learned counsel, after above, has pointed out that the basic grievance in this petition is that the petitioners and several other persons, who have purchased the properties about 40/50 years back in Bahadur Yar Jang Cooperative Housing Society Limited  (“BYJCHS”) hereinafter referred to as “the society” were treated members at par but now have not been treated the members of the society and have not been allowed to cast their votes on the ground that although the petitioner is owner of the property through a past member but he cannot be allowed to be a member of the society due to restrictions imposed on the membership under the bye-laws of the society as only persons with Hyderabad Deccan origin and being Muslims will become members.  He submits that the dispute was taken under the cooperative forum and nominee of the Registrar decided the issue but grievance was dismissed.  In appeal the order was modified by the Registrar Cooperative Societies to the extent that the award was set aside to the extent that petitioner, Ferozuddin Shamsi, a member of the existing Managing Committee at that time was allowed to continue till duration of his tenure.  He submits that apart from above, the grievance was also raised before the Minister Cooperation, Government of Sindh, which was taken up by Minister Cooperation and keeping in view the past litigation before lower cooperative forums he considered that grievance a continuity to the previous decided issue and considered the matter as Revision under the Cooperative Societies Act (hereinafter referred to as “the Act”) and dismissed the same.  Learned counsel submits that impugned order is not even based on proper factual position and presumptive position has been adopted, therefore, the order is not sustainable in law.  He further submits that the order is not tenable legally as it is in sheer violation of law especially Section 17-B of the Act.  Learned counsel for the petitioners has, first of all, pointed out the documents filed by him with his statement dated 13/12/2006 and stated that most of these documents pertain to the minutes of meetings of the society from the year 1999 till 2001/2002.  In the said documents, he has pointed out, the name of petitioner Ferozuddin Shamsi, Mateen Hameed, SM Yousuf, and Mazher Ahmed Batla and stated that all these four persons were non-Hyderabadi but remained not only simple members but members of Managing Committee of the Society and in such a situation when the petitioners and others have already been granted status of members then the society cannot dispute their status. He submits that the order of the Registrar in appeal passed on 3/12/2003 shows that petitioner, Ferozuddin Shamsi, was even a member of Managing Committee at the date of order.  He submits that the amendment in the bye-laws was made in 2003 whereby the original text of bye-laws No.7 was substituted with reasons given for the substitution and same is reproduced as under:

 

SCHEDULE OF AMENDEMTN OF BYE-LAWS OF BYJCHS LTD, KARACHI

UNDER SECTION 16(2) OF COOPERATIVE SOCIETIES ACT – 1925

 

BYE-LAW NO.

ORIGINAL TEXT OF BYELAWS

 

AMENDED TEXT OF BYELAWS

REASON THE AMENDMENT

APPROVAL OF DY. REGISTRAR

7

All persons who have signed the application for registration are original members. Other members shall be elected by the Committee provided that all members shall belong to Hyderabad Daccen and shall be Muslims migrating to Pakistan. One third adverse votes are sufficient to exclude an applicant. Every person shall pay Rs.10/- on applying for admission. In cases where the application is refused the entrance fee shall be returned. A copy of the bye-laws of the Society shall be supplied on payment of Rs.1 only

All persons who have signed the application for registration are original members. Other persons shall be elected as members by the Committee provided that they shall be Muslims belonging to Hyderabad Daccen who have migrated to Pakistan or their family members and blood relation. Other persons who do not belong to Hyderabad Daccen will be Associate member to be approved by the committee having full rights on their property but no voting rights. One third adverse votes are sufficient to exclude an applicant. Every person shall pay Rs.50/- on applying for admission. In case where the application is refused the entrance fee shall be returned. A copy of the bye-laws of the Society shall be supplied on payment of Rs.50/- only.

1-   The old generation of the members belonging to Hyderabad Daccen who had migrated to Pakistan had more or less parted away. The amendment has thus become necessary to open membership for the family members and their blood relation to accommodate them as members after transfer of their plots to the legal heirs by way of gifts during their life time and otherwise to meet requirement of provisions of Section 17-B of  the Coop. Societies Act, 1925.

 

2-    The enhancement in the cost of byelaws is due to rise in the cost of paper and printing.

 

 

 

 

APPROVED

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sd/-

District Officer    Co-operative City Distt: Government Karachi

 

   

The above amendment annoyed the petitioners and matter was taken up before the cooperative forum and then taken up before the Minister Cooperation separately who by mixing it up with grievance raised earlier in the shape of award etc decided the issue by his impugned order dated 10/9/2005.  Learned counsel argued that the Cooperative Society by its own previous conduct spreading over 40 years was estopped from changing the status of membership of non-Hyderabadi and specifically of the petitioners as they remained at the helm of controlling the affairs as executive of Managing Committee. He further argued that under Section 17-B of the Act, a transferee of plot from a member of society becomes member of the society and he cannot be restrained from participating in elections nor can be denied the membership.  After referring Section 19-2(b) of the Act, he argued that restrictions imposed by the society is contrary to the Article 17 of the Constitution of Islamic Republic of Pakistan, 1973 and also violate the Article 25 of the Constitution and that the restrictions imposed cannot be considered as reasonable restrictions keeping in view Section 17-B of the Act.  He submits that total membership of the society is around 651 out of which Hyderabadi origin persons are not more than 182 which is decreasing day by day due to lucrative offers from non-Hyderabadi and in that event the minority of about 182 members is controlling the majority i.e. non-Hyderabadi which are around 500.  Learned counsel for the petitioners has cited following case laws in aid of his above contentions:

 

1.       PLD 1993 S.C. 210

2.       AIR 1972 Patna 455

3.       AIR 1997 Bombay 289

4.       PLD 2001 Karachi 52

5.       PLD 1996 Karachi 1

6.       PLD 1990 S.C. 295

7.       AIR 1970 S.C. 245

8.       AIR 1939 Allahabad 466

9.       1898 2 Q.B. 91

10.     PLD 2003 S.C. 430

 

The case of Karachi Building Control Authority and 3 others v. Hashwani Sales and Services Limited and 3 others, PLD 1993 S.C. 210, this authority is on the point that when the regulations framed by Authority under Section 21-A of the Sindh Buildings Control Ordinance, 1979 have no nexus with the objects of Section 6 of the Ordinance then the regulations will be ultra vires.

 

The case of Postal Cooperative House Construction Society Ltd. v. The Registrar and others, AIR 1972 Patna 455, the Court has held that byelaws are not statutory rules and if a person is admitted as member of the society under the byelaws then his membership cannot be cancelled even by the General Body.

 

The case of Sanjivraje Vijaysinha Naiknimbalkar and others v. Rajan Dinkarrao Pharate and others, AIR 1979 Bombay 289, is on the point that when time to make payment was extended for the members then their names could not be excluded from the list of voters.

 

The case of Ziauddin Hospital Trust through Trustee and Medical Director v. Director General/Commissioner, Excise and Taxation, Sindh, Karachi and another, PLD 2001 Karachi 52, it has been held that when right is created in favour of a litigant, such right in due course of time cannot at all be taken back arbitrarily.

 

The case of Zohra and 5 others v. The Government of Sindh, Health Department through its Secretary, Sindh Secretariat, Karachi and another, 1996 PLD Karachi 1, explains the words “just” and “unjust” and that qualification of these words is to be determined keeping in view the right and proper justification in the eye of law.

 

The case of Shrin Munir and others v. Government of Punjab through Secretary Health, Lahore and another, PLD 1990 S.C. 295, the word “discrimination” and “alone” has been defined and it has been observed that discrimination of  group and individual implies making an adverse distinction with regard to some benefit, advantage or facility.

 

The case of Cooperative Central Bank Ltd. and others etc. v. Additional Industrial Tribunal, Andhra Pradesh, Hyderabad and others etc., AIR 1970 S.C. 245, it has been held that byelaws of a cooperative society is to be interpreted in the interest of cooperative movement.

The case of Mewa Ram v. Muncipal Board, Muttra, AIR 1939 Allahabad 466, it was observed by the Court that byelaws to be interpreted keeping in view the context under which they are being framed and there must be reasonableness.

 

In the case of Kruse v. Johnson, 1898 2 Q.B. 91, the Court observed that byelaws ought to be supported unless it is manifestly partial and unequal in its operation between different classes, or unjust, or made in bad faith, or clearly involving an unjustifiable interference.

 

The case of Mst. Amina Bibi v. Mudassar Aziz, PLD 2003 S.C. 430, is on the point that restriction of transfer of a plot of the society will not be placed when membership has been accepted by the society.

 

On the other hand Mr. Ishrat Alavi, learned counsel appearing for intervenor, Messrs. Karachi Cooperative Housing Societies Union Limited, Karachi (hereinafter referred to as “the Union”) whose application (CMA No.1069/2008) under Order 1 Rule 10 read with Section 151 CPC is being allowed today with the no objections of other Counsel, has argued that Section 17-B of the Act is further controlled by the bye-laws of the society and if the bye-laws do not permit then persons cannot claim the membership while factual position in respect of participation of some non-Hyderabadi in the management of the society as a members as well as officers of Managing Committee cannot override the bye-laws of the society. He further argued that the mistakes can be corrected at any stage and they being illegal no benefit can be taken by anybody. He has emphasized that legally reasonable classification is justified, therefore, classification of members or non-members or associate members of the society is justified.  In this respect, he has relied upon the case law reported as Syed Abul Alam Modoodi, PLD 1964 S.C. 673. On the point of interpretation of bye-laws of a public representative body, he has cited AIR 1939 Allahabad 466.  He argued that all non-Hyderabadi members are the purchasers of properties from Hyderabadi members, cannot acquire membership by virtue of purchase of plots and they can only be considered as Associate Members with no right to vote or participate in the management of society.

 

Mr. Iqbal Haider, learned counsel appearing for Society, the respondent No.2, has first of all raised legal objections in respect to maintainability of the petition on the ground that two of the petitioners had withdrawn their appeals before the appellate forum of Registrar while remaining members i.e. Ferozuddin Shamsi was not an aggrieved person as he was not contesting the elections but was in the Managing Committee till expiry of his term. To support this factual position, the learned counsel has referred to second page of the order of the Registrar in Appeal No.1 of 2003.  Apart from above, learned counsel has justified the impugned order by pointing out the Notification dated 25th July, 1996 whereby Mr. Nisar Ahmed Charan was appointed an Administrator of the society. He stated that all irregularities and illegalities in the membership of the society was done by the Administrator and not by the Managing Committee of the Society and same has been referred to by the Minister Cooperation in his order, hence these illegalities are not binding on the society.  He has further argued that by virtue of Section 64-AA of the Act, order passed on a Revision under Section 64 attained finality and cannot be challenged and that there is no violation of law and that Section 17-B of the Act is to be read with Rule 4 of the Cooperative Societies Rules, 1927 (hereinafter referred to as “the Rules”).  He submits that the amendment made by the society is proper and within the meaning of law and it cannot be done away and the petitioners have no right to claim membership or voting right and that there is no violation of law if even the minority is ruling the majority.  The learned counsel has relied upon the following case laws in support of his contention:

 

1.       PLD 2002 Karachi 414

2.       2004 MLD 1962

3.       1991 CLC 1917

4.       PLD 1960 Karachi 325

5.       SBLR 2004 Sindh 1488

 

The case of M. Wahidullah Ansari through Legal Heirs v. Zubeda Sharif and another, PLD 2002 Karachi 414, provides interpretation of Sections 54, 70-A of Cooperative Society Act  and the Court has held that as to when Section 54 of the Act will be applicable, what is the meaning of “touching business of a society” as well as Section 70-A of the Act.

 

The case of Ch. Muhammad Latif v. The Secretary, Election Commission Jammu and Kashmir Cooperative Housing Society and 2 others, 2004 MLD 1962, it was observed that when the petitioner was not proved to be the member of the society then he has no right to file petition and to interfere in the election process through constitutional petition.

 

The case of Muhammad Haroon Usman v. Rizwan Cooperative Housing Society and 11 others, 1991 CLC 1917, is on the point that issue of membership when referred to the Registrar then decision in that respect will be final while civil court have not jurisdiction to interfere in the matter.

 

The case of D. M. Malik v. Jockey Club of Pakistan and others, PLD 1960 (W.P.) Karachi 325, it has been observed by the Court that civil court generally would not interfere unless rules were opposed to natural justice or there was malice or mala fides or the principle of natural justice was ignored.

 

The case of Lt. Col. (Retd.) Riaz Mohiuddin & others v. Karachi Gymkhana Club & others, SBLR 2004 Sindh 1488, relates to a matter when the plaintiff was not found fit for equitable relief as the Court found him without balance of inconvenience.

  

Mr. Fareed Ahmed Dayo, learned AAG along with Mr. Imran Mehdi Memon, D.O. Cooperative Societies Sindh stated, after consulting their record, that the petitioners and other non-Hyderabadi participated in the years 1999 to 2003 while the society was superseded in 1996 and its management was handed over much prior to the participation of the petitioners in the management.  Learned AAG submits that Section 17-B, as introduced through an amendment, has overriding effect and a person purchasing a property from a member of the society becomes a member and enter into the shoes of the past member as the seller looses his right to the membership while the purchaser gets the property along with the membership.  They further submit that there are other several provisions of the Act and the Rules which can be enforced against the members only in case of non-observance of byelaws or non-payment by them the dues of the society.

 

Mr. Abrar Hassan, past President of the High Court Bar Association, who was listening the arguments with concentration, requested by the Court to give his point of view.  He submits that Section 17-B of the Act to be interpreted in its own words and that reasonable classification as argued by the Societies Counsel cannot be permitted to the extent that one should suffer unreasonably while other benefits adversely.  He has further pointed out Section 55 of the Transfer of Property Act, 1882 and emphasized on second part of the proviso of subsection (2) of that section which reads as under:

 

          “The benefit of the contract mentioned in the rules shall be annexed to, and shall go with the interest of the transferee as such, and may be enforced by every person in whom that interest is for the whole or any part thereof from time to time vested.”

 

After hearing the arguments of learned counsel, it is necessary to mention that although the Minister Cooperation has mixed up the complaint filed before him with arbitration proceedings initiated under the cooperative system as well as the appeal filed against the award but anyhow since the basic grievance raised in this petition, as mentioned above, is of public importance and that the contesting parties are also aware of their contentions, therefore, the above issue is taken up.  First of all the relevant portion of the order dated 10/9/2005 passed by the Minister Cooperation is necessary to be reproduced, which is as under:

 

          “Bahadur Yar Jan Cooperative Housing Society was formed in 1949 by those persons who migrated from Hyderabad Deccan India. Under bye-law 7 of the Bye-Laws of the Society it is laid down that “all persons who signed the application for registration are original members. Other persons shall be elected as Members by the Committee, provided they are muslims belonging to Hyderabad Daccan and who and their family members and blood relations migrated to Pakistan. Persons who do not belong to Hyderabad Deccan will be associate members but shall have no voting right.”

 

Subsequently, while the society was under supercession, the Administrator appointed by the Government, amended the byelaws of the Society on 12-4-2003 and empowered the Associate Members of the Society to exercise the right of vote.

 

The Counsel for respondent society argued that the sanctity of the byelaws of the society has been violated.  The members who signed and formed the society had specifically laid down the eligibility criteria for voting members. The sponsors were very clear in their mind that the control and management of the Society shall, remain in the hands of those members who belonged to Hyderabad Deccan and migrated to Pakistan after Independence. The membership was also extended to those who were the blood relations of the immigrants of Hyderabad Deccan.

 

The byelaws framed by the sponsors / original members of a Cooperative Society are sacrosanct and a sort of bible for the Society. Its amendments can only be done by the sponsors or those who exercised the right to vote. The Administrator during supercession has no powers to amend the fundamental rights enshrined in the byelaws. His role is merely to restore the order within the society and to hold elections and transfer power to the elected members. The arguments that the Administrator exercised the powers of Managing Committee to amend the bye-laws that are substantial in nature in not tenable. Had the superceded Managing Committee remained in power, they too could not have empowered the Associate Members – not belonging to Hyderabad Deccan, to exercise the right of vote as those who formed the society excluded non-Hyderabadis in controlling the management of the Society.

 

I would thus hold that the amendment of byelaw-7 by the Administrator was not in conformity with the objectives for which the Society was formed.  Associate members who did not migrate from Hyderabad Deccan are not eligible to exercise the right of vote. Hence the applicants have no case and the application merits no consideration and is dismissed.”

 

There is unanimity amongst the learned counsel that the above order has depicted incorrect factual position in respect to the supercession of the Society in 2003 and amendment of byelaws by the Administrator on 12/4/2003 and this unanimity is for the reason that admittedly Administrator was appointed in 1996 and within 2/3 years the management of the society was handed over to the society and since 1999 the society was working through its own elected representatives. The above mistakes on part of the Minister shows that he has not given due consideration even to the record available to him.  Likewise the last para of the order shows that the amendment of byelaws 7 of the Administrator was not in conformity with the objectives for which the Society was formed.  This para if read carefully will put the grievances of the parties in juxtaposition as proposed amendment in April 2003 has been proposed by the respondent society and has been challenged by the petitioners while in the impugned order the amendment has not been found in conformity with the objectives of the society.  The plain reading of last para shows that the amendment by the society by which non-Hyderabadis were refused membership status was not approved by the Minister.  In such a situation, the order is full of flaws and deserves to be recalled, therefore, on account of serious ambiguities in the impugned order, we set aside along with other orders of lower forum for the reasons above and hereinafter.

 

Now on merits of the case keeping in view the contentions of the parties and important question which is coming out from their contentions, “that as to whether section 17-B of the Act has overriding status upon the byelaws of a cooperative society and a purchaser acquire right of property and membership from seller” it would be advantageous to reproduce Sections 17-B and 19 of the Act along with Rule 4(a) of the Rules, 1927, which read as follows:

 

          “17-B Transfer of Interest in a housing society.- A member of a cooperative housing society or a society dealing in housing development shall cease to be member of the society in case all his interests in the immoveable property in the society are transferred in favour of any other person by sale, inheritance, gift or otherwise, and the person acquiring such interests shall subject to rules be admitted as a member:

 

          Provided that where more than one person acquire the interests, one of such persons with mutual consent, failing which the person older in age shall be admitted as member having right to vote while other persons will be the members without such right:

 

          Provided further that where a minor or a mentally disable person, acquires the interest, the natural or legal guardian of the minor or, as the case may be, the person bound to maintain the disabled person shall be admitted as a member and such membership shall stand transferred to the minor as soon as he acquires majority or to the disabled person as soon as his disability is removed.

 

19. Restrictions on transfer of share or interest.- (1) The transfer or charge of the share or interest of a member in the capital of a society shall be subject to such conditions as to maximum holding as may be prescribed by this Act or by the rules.

 

(2)               A member shall not transfer any share held by him or his interest in the capital or property of any society or any part thereof unless-

 

(a)               he has held such share or interest for not less than one year; and

 

(b)               the transfer or charge is made to the society or to a member of the society or to a person whose application for membership has been accepted by the society.

 

Rule 4.  Matters in respect of which a society shall or may make bye-laws.- (1) The matters in respect of which every society shall make bye-laws are the following:

 

(a)               The name and address of the society and its branches, the tribe, class, caste or occupation of its members if the membership is proposed to be so restricted, and the area for which it is to be registered;”

(emphasis added the Court)

 

It will be pertinent to mention here that Section 17-B of the Act was inserted by way of amendment in 1989. To interpret Section 17-B, it is necessary to look at section 19 of the Act. Subsection (2) of Section 19 restricts a member from transferring any share held by him or his interest in the property unless the transfer is made to the society or to a member of the society or to a person whose application for membership has been accepted by the society.  According to that very section, there were certain restrictions and the properties, under a society, were transferred off the record as there was restriction for transfer to the members only.  The law at the relevant time was itself imposing membership restriction but later on it introduced Section 17-B which provides that a member of a cooperative housing society shall cease to be a member of the society in case all his interests in the immoveable property in a society is transferred in favour of any other person by any mode; however, the membership has been subjected to rules which are naturally 1927 Rules. In this respect Rule 4(a) can be referred which provides some restrictions and limit the membership to the tribe, class, caste or occupation of its members.  Keeping in view the wordings of Section 17-B, there is nothing about associate members etc as contended by the learned counsel appearing for the societies and notwithstanding the fact that all modes of transfer including sale, inheritance, gift or otherwise have been mentioned in that section but the transferee has been termed as a member only in the first proviso of that section with no other definition.  We observed that Section 17-B being a provision of the Act will have overriding status over Rule 4 of the Rule 1927 and also for the reason that the same has been brought in the statute at very late stage in 1989, therefore, it can be presumed that it was incorporated keeping in view the requirement of law, public and society as well. Section 17-B of the Act is the only section which is legalizing the transfer from a member to another person without any restrictions and immediately after the transfer, the transferee becomes entitled to the membership of the society as under the said very section the transferor ceased to be a member after the transfer of his interest in the immovable property, therefore, his share in the society, which are also an interest of the transferor and are attached to the plot and/or prerequisite for acquiring the plot is naturally to be transferred to the member acquiring the property through transfer from a past member.  Section 19(2)(b) of the Act was restricting the transfer of the property to a member only while after amendment in 1989 Section 17-B is permitting the same to a non-member. Rule 4 of the Rules, 1927 and the bye-laws of a society made in terms thereof cannot override Section 17-B of the Act and will be void and redundant to the extent of wordings of Section 17-B.  We have also observed from the legal position given above and we are also cautious of the changing situation which are emerging day by day when more or less all the members of cooperative society are transferring their shares against the lucrative offers or the properties in the societies are transferred by virtue of inheritance, gift, intermarriages or through the court auction and in that way it can happen that the original membership of the society can shrink to a number which is less than the requirement of a cooperative society as presence of 30 members is necessary under the Cooperative Laws to continue a society. When the situation was explained to the above-named D.O. of the Cooperative Societies Sindh as well as other counsel then they could not submit a proper reply but agreed that in that case dissolution of the society can happen. If this factual position is realized further then there will be anarchy in the affairs of the societies as there are thousands of societies in Pakistan and it will be difficult for the cooperative system to manage the title of the properties and safeguard the interest of the members as well as to serve the very purpose of cooperative for which a society was formed.

 

It is to be seen that the very intention of the government, appearing from the Act is to promote cooperative business in the shape of acquiring land then allotting the plots and keeping its record and maintain a comfortable system and tranquility in the society including use of individual and joint amenities without causing problem for others. All this can be done when there is cooperation and consensus amongst the members of the society and adverse situation would create not only serious problem but law and order situation as well.

 

Keeping in view the above, minority cannot be allowed to issue directions to the majority nor obedience can be expected. It can also be a situation when two owners of the houses but without membership, have grievance against each other then what will be situation and as to whether they will be in a position to take up grievance to arbitrator under Section 54-A of Act. The society itself can face same situation when it encounter a person who is claiming the property as 5th or 6th owner and membership has been denied to him, then whether cooperative forum will be applicable or not. For the above reasons and to tackle that situation section 17-B in the Act has been introduced having overriding status.

 

The intention of the basis members forming a society may be sacrosanct till the time they themselves maintain that situation by selling the plot only to persons fulfilling the criteria of a member but when care has not been taken and members themselves chose to transfer their all interest without membership qualification of a buyer then new owner acquiring all interest of a seller cannot be denied the membership.

We have gone through all the authorities cited by the learned counsel and we do agree that there is no restriction for reasonable classification or reasonable restrictions nor there is issue of jurisdiction in respect to matter of jurisdiction when cooperative society is involved but in the case in hand these authorities do not exactly match with the factual position and issue involved and, to some extent, support the petitioner.  In such a situation, we allow this petition by declaring that the impugned absurd order dated 10/9/2005 passed by the Minister Cooperation is an invalid order, which is accordingly set aside.  It is also declared that Section 17-B of the Act has a overriding status over the Cooperative Societies Rules, 1927 as well as byelaws of cooperative societies and a person acquiring the property from a past member also acquired the membership of the society besides the property he has purchased irrespective of any limitation which has been imposed in this respect under the byelaws of the society as the restrictions under the byelaws could be valid only till the time when Section 17-B of the Act was not introduced but thereafter it is to prevail.

 

It can also be gathered from the Act and Rules 1927 that there are certain offences and penalties provided and in some of them the action is restricted against the society or the members and not against the non-member. In such a situation, it will be difficult to have enforcement of society’s byelaw through the effective force of the office of Registrar of Cooperatives.

 

With the above observations, this petition stands disposed of.

 

 

 

Karachi;

Announced on:__________/2008                             J U D G E

 

                                                        J U D G E