Disposed

Er.Babusha.N v. Sree Narayana Health Care Society

Kerala HC25 Nov 2022FAO/112/2022

Case brief

AI extract

What is this about?

A charitable society's membership admissions were challenged pending a management-scheme proceeding. The Court set aside the impugned order and directed continuation of the society's stated position of admitting no new members until disposal. It required disposal within four months, leaving the disputed bye-law provisions for trial.

What did the court decide?

Impugned order set aside; no new members to be admitted until disposal; trial court directed to dispose of the case within four months of receiving the judgment.

Er.Babusha.N Vs Sree Narayana Health Care… — Civil Procedure and Limitation | Kerala HC (2022)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MRS. JUSTICE M.R.ANITHA

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FRIDAY, THE 25^TH DAY OF NOVEMBER 2022 / 4TH AGRAHAYANA, 1944

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FAO NO. 112 OF 2022

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AGAINST THE ORDER DATED 27.08.2022 IN I.A.No.01 of 2021 in OP(Society) 122/2021 OF ADDITIONAL DISTRICT COURT - IV,

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KOLLAM

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APPELLANTS/PETITIONERS 1,4,8,10,11 AND 25 IN IA AND O.P

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(SOCIETY):

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1 ER.BABUSHA.N AGED 67, S/O T.V. NANU, MEMBER NO. 01, RESIDENT OF UTHRADOM, ASRAMAM. P.O, KOLLAM-691002.

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2 DR. G.UNNIKRISHNAN, S/O GANGADHARAN, AGED 66, MEMBER NO. 102, BHADRASREE,Q.S. ROAD, TOWN LIMIT, KOLLAM-691008

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3 CHANDRAN.K, S/O KARUNAKARAN, AGED 72, MEMBER 31, SREENIDHI, RAMANKULANGARA NAGAR- 167, KAVANAD.P.O, KOLLAM691003

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4 R.PRADEEP, S/O P.K.RAGHAVAN, AGED 61 YEARS, MEMBER NO. 104, JEEVAN SREE, PADA NORTH, KARUNAGAPPALLY. P.O, KOLLAM-690518.

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5 P. PRASANNAN, S/O N.S. PRABHAKARAN,AGED 68, MEMBER NO.211, LEKSHMI PRABHA, MUNDAKKAL, KOLLAM-691001.

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6 B. SANTHOSHKUMAR, S/O BHASKRAN, AGED 62, MEMBER NO. 180, SEEMAS VILLA, ULIYAKKOVIL.P.O, KOLLAM-691019. BY ADVS.

P.B.KRISHNAN

F.A.O.No.112/2022

P.B.SUBRAMANYAN SABU GEORGE MANU VYASAN PETER

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RESPONDENTS/RESPONDENTS 1 TO 3, 5 TO 30 AND PETITIONERS 2,3,5 TO 7,9,12 TO 24, 26 TO 33 IN IA AND O.P (SOCIETY):

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1 SREE NARAYANA HEALTH CARE SOCIETY A CHARITABLE SOCIETY REGISTERED UNDER THE PROVISIONS OF THE TRANVANCORE-COCHIN LITERARY, SCIENTIFIC AND CHARITABLE SOCIETIES REGISTRATION ACT (ACT 12 OF 1955), REG. NO. Q.1113/2002, PANGOD, KARIMPINPUZHA.P.O, PAVITHRESWARAM VILLAGE, KOTTARAKKARA TALUK, KOLLAM-691507, REPRESENTED BY ITS SECRETARY, BY M.L.ANIDHARAN.

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2 M.L.ANIDHARAN, S/O LEKSHMANAN, AGED 78, MEMBER NO. 30, JYOTHIS, BHAVANA NAGAR-51, KADAPPAKKADA.P.O, KOLLAM691008, SECRETARY S.N.H.S

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3 PROF. K.SASIKUMAR, S/O KARUNAKARAN, AGED 73, CHAIRMAN, (NOMINATED EXECUTIVE COMMITTEE MEMBER), SREE NARAYANA HEALTH CARE SOCIETY, RESIDENT OF PADMARAGAM, AMRUTHUKULAM, MUNDAKKAL EAST, KOLLAM-691001. (DR. S. MOHAN, RESPONDENT NO.4/DEFENDANT NO.4 IN THE COURT BELOW DIED AND IT IS REPORTED IN THE COURT BELOW THAT HIS LRS NEED NOT BE IMPLEADED)

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4 G. RAMACHANDRAN, S/O GOPALAN, AGED 71 YEARS, TREASURER, MEMBER NO.03, KAVERY, VELLIMON.P.O, KOLLAM-691511.

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5 ER. SALIM. M.NARAYANAN, S/O K. NARAYANAN, AGED 63 YEARS, JOINT SECRETARY, MEMBER NO.10, GOKULAM, MYTHRI NAGAR-92, ASRAMAM P.O, KOLLAM-691002.

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6 K. AMRITHALAL, S/O KUNJU PANKICKER, AGED 69, EXECUTIVE COMMITTEE MEMBER, MEMBER NO. 29, ASHIRVAD, THANKASSERI, KOLLAM-691007.

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F.A.O.No.112/2022

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7 D. PRASANNAN, S/O DIVAKARAN, AGED 72, EXECUTIVE COMMITTEE MEMBER, MEMBER NO. 165, PRESLI, SANKAR (WRONGLY STATED AS SANKAA) NAGAR, KOLLAM-691001.

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8 N. GOPINATHAN, S/O NARAYANAN, AGED 75, EXECUTIVE COMMITTEE MEMBER, MEMBER NO.192. THEJAS, OLAYIL JAYAN NAGAR- 93, THEVALLY.P.O, KOLLAM-691009.

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9 P.C WILSON, S/O CHENNAN, AGED 74 YEARS, EXECUTIVE COMMITTEE MEMBER, MEMBER NO.73, PANIKKASSERIL HOUSE, ALATTUKAV NAGAR- 76, KANNIMEL CHERRY, KAVANAD.P.O, KOLLAM-691003.

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10 DR.G.RAJENDRAN, S/O GANGADHARAN, AGED 68 YEARS, EXECUTIVE COMMITTEE MEMBER, MEMBER NO. 141, SGM BHAVAN, KANNANALLOOR.P.O, KOLLAM-691576.

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11 V. JAYAPRAKASH, S/O VELAYUDHAN, AGED 65, EXECUTIVE COMMITTEE MEMBER NO.P01, KEYEES, MUNDAKKAL P.O, KOLLAM691010.

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12 G.VENUGOPAL, S/O GOPALAN, AGED 69 YEARS, EXECUTIVE COMMITTEE, MEMBER NO. P02, SAVEE NIVAS, ASRAMOM.P.O, KOLLAM691002.

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13 P. SUNDARAN, S/O PRABHAKARAN, AGED 69, EXECUTIVE COMMITTEE MEMBER, MEMBER NO. P04, LEKSHMI PRABHA, SREENAGAR- 14, KADAPPAKKADA.P.O, KOLLAM-691008.

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14 G. SUNDARESAN, S/O GOPALAN, AGED 74, EXECUTIVE COMMITTEE MEMBER, MEMBER NO. P05, GANAPATHY BHAVAN, VADAKKEVILA P.O, KOLLAM-691010.

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15 G. SURESH, AGED 66, EXECUTIVE COMMITTEE MEMBER, MEMBER NO. 26, AKHILA, PATTATHANAM.P.O, DRASANA NAGAR- 60, KOLLAM

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16 DR.N.PANKAJAKSHAN, AGED 69 YEARS, EXECUTIVE COMMITTEE MEMBER, MEMBER NO-28, CHERUKULATHU, THATTAMALA.P.O, KOLLAM691020.

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F.A.O.No.112/2022

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17 K.S VIJAYAN, S/O SUKUMARAN, AGED 75, EXECUTIVE COMMITTEE MEMBER, MEMBER NO 228, SUKUMARANA, MANACAUD, ATTUKAL, THIRUVANANTHAPURAM-695009.

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18 DR.V. CHITHARANJAN, AGED 68 YEARS, EXECUTIVE COMMITTEE MEMBER, MEMBER NO.214, VRINDAVANAM, THAZHEKKARA, MAVELIKKARA, ALAPPUZHA-690102.

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19 PRAKASH NADESAN, S/O NADESAN, AGED 69 YEARS, EXECUTIVE COMMITTEE MEMBER, MEMBER NO. 225, CHEPPALLY, KOTTIYAM.P.O, KOLLAM-691571.

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20 DR. A.B.PRADEEP, AGED 65 YEARS, EXECUTIVE COMMITTEE MEMBER,MEMBER NO. 142, PADMA BHAVAN, ALUMKADVU.P.O, KARUNAGAPPALLY, KOLLAM-690573.

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21 GOPALAKRISHNA PANIKER, S/O PRABHAKAR PANICKER, AGED 59 YEARS, EXECUTIVE COMMITTEE MEMBER, MEMBER NO. 34, MANGALYA, VADAYATTUKOTTAH, KOLLAM-691001.

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22 D. JAYACHANDRAN, AGED 61 YEARS, EXECUTIVE COMMITTEE MEMBER, MEMBER NO.119, SRI DEVI MANDIRAM, TC/28/2636, CHETTIKULANGARA, TIRUVANANTHAPURAM-695035.

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23 K.K.SHANAVAS, S/O KUMARAN, AGED 62, EXECUTIVE COMMITTEE MEMBER, MEMBER NO. 117, KOICKAL, CHERUPOIKA.P.O, PAVITHRESWARAM, KOLLAM-691543.

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24 A. SATHEESAN, S/O ACHUTHA PANICKER, AGED 80 YEARS, EXECUTIVE COMMITTEE MEMBER, MEMBER NO. 133, THEJAS, KADAPPAKKADA.P.O, KOLLAM-691008.

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25 D. RAJKUMAR, S/O DAMODARAN, AGED 59 YEARS, NOMINATED EXECUTIVE COMMITTEE MEMBER, KOCHUVILAYIL, PALACE ROAD, THEVALLY.P.O, KOLLAM-691009.

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26 PROF. K. JAYAPALAN, S/O KESAVAN, AGED 79 YEARS, NOMINATED EXECUTIVE COMMITTEE MEMBER, UPASANA, MUNDAKKAL.P.O, KOLLAM691010.

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27	SUNIL KUMAR. A, S/O ASOKAN, AGED 60 YEARS, NOMINATED EXECUTIVE COMMITTEE MEMBER, SUNIL NIVAS, KOOTTIKKADA.P.O, THATTAMALA, KOLLAM-691020.
28	S. JAYADEVAN,
	AGED 62 YEARS, NOMINATED EXECUTIVE COMMITTEE MEMBER, SUBHADRALAYAM, KOOTTIKKADA.P.O, KOLLAM- 691020.
29	S.K. YASODHARAN, S/O KESAVAN,AGED 69 YEARS, NOMINATED EXECUTIVE COMMITTEE MEMBER, RAJASREE, MUNDAKKAL WEST, KOLLAM-691010.
30	PROF. V.S. LEE, S/O VASAVAN, AGED 64, MEMBER NO.179, RESIDENT OF SNEHA, PUTHENKULAM.P.O, BHOOTHAKULAM, KOLLAM- 691302.
31	DR.V. CHANDRAMOULEESWARAN, S/O VASUDEVAN, AGED 73 YEARS, MEMBER NO.81, REVATHY. NO.5, BODHI NAGAR, THATTAMALA.P.O, KOLLAM-691020
32	DR. R. PRAKASH, S/O P.K. RAGHAVAN, AGED 65, MEMBER NO.59, KRISHNA
	NIVAS, PADA NORTH, KARUNAGAPPALLY, KOLLAM-690518.
33	DR. M. RAJENDRAN, S/O K.MATHU, AGED 73 YEARS, MEMBER NO.210, MELECHERUVIL HOUSE, NEDUMPANA.P.O, KOLLAM-691576.
34	K.G.THAMPI,
	S/O E.GOVINDAN, AGED 77 YEARS, MEMBER NO.101, T.S.NIVAS, SAGARA NAGAR- 98, KADAPPAKKADA.PO, KOLLAM-691008
35	SUDEVAN.S, S/O SREEDHARAN, AGED 64, MEMBER NO. 115, VALUTHIMDIL VEEDU, KARIKKAL, KARIMPINPUZHA P.O, KOLLAM-691513.
36	B. ASOKAN,
	S/O BHARGAVAN, AGED 73, MEMBER NO.62, VILAYIL
	VEEDU, KARTHIKA, KUREEPUZHA, PERINAD.P.O, KOLLAM- 691604.
37	K.P.SYAMALA DEVI,
	D/O K.N.PEETHAMBARAN, AGED 61 YEARS, MEMBER NO.

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	144, UTHRADOM, ASRAMAM.P.O, KOLLAM- 691002.
38	DR. SHEELA.P, D/O K.NARAYANAN, AGED 61, MEMBER NO.190,NARAYANEEYAM, BRN 9A, MADANNADA, THEKKEVILA.P.O, KOLLAM-691016.
39	DR. T. AMBILIKUMARI, S/O VISWANATHAN, AGED 52, MEMBER NO.74, AKSHAYA, PURALI NAGAR-119, PUNTHALATHAZHAM, KOLLAM-691004.
40	K. SATHYADEVAN, S/O KUMARAN, AGED 67 YEARS, MEMBER NO.204, ALANGATTU VEEDU, VILLIMANGALAM, MUNROTHURUTHU.P.O, KOLLAM-691502.
41	B.S. HARILAL, S/O BALAKRISHNAN, AGED 63, MEMBER NO.116,
	NIRAPPUVILA EAST, KALLADA.P.O, KOLLAM-691502.
42	M. SARATHCHANDRAN, S/O MADHAVAN,AGED 74 YEARS, MEMBER NO.64, CHAKKALLINS, PRAKKULAM.PO, KOLLAM-691602.
43	V.S.LAI, S/O VASAVAN, AGED 62 YEARS, MEMBER.NO.121, SNEHARAM, ALTHARAMOODU, CHIRAINKEEZHU.P.O, THIRUVANANTHAPURAM-695304.
44	P. PRASAD, (WRONGLY STATED AS PRADSAD), S/O PEETHAMBARAN, AGED 53, MEMBER NO. 148, MATHANAD VALIYA VEEDU, KALLAMBALAM.P.O, THIRUVANANTHAPURAM-695605.
45	P. PREMJITH,
	S/O PEETHAMBARAN, AGED 51, MEMBER NO. 182. MATHANAD VALIYAVEEDU, KALLAMBALAM.P.O, THIRUVANANTHAPURAM-695605.
46	N.SAVYA SACHI, S/O SADANANDAN, AGED 70, MEMBER NO.181, REVATHI, BHOOTHAKULAM P.O, KOLLAM- 69102.
47	V.JOY,
	S/O VISWAMBARAN, AGED 56, MEMBER NO.183, BHAGYA LEKSHMI, PUTHENKULAM P.O, SOUTH PARAVUR, KOLLAM- 691302
48	S. MURALEEDHARAN, S/O SREEDHARAN, AGED 72 YEARS,. MEMBER NO. 125, GREEN LAND, CHERUMANGAD, PUTHOOR.P.O, KOLLAM- 691507.

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49	U. SURESH, S/O UTHAMAN, AGED 49 YEARS, MEMBER. NO. 198, MADHAVA SADANAM, NEDUMPANA, KOLLAM-691576.
50	J.RAJENDRAN, S/O JANARDHANAN, AGED 65, MEMBER NO. 199, SREE CHAKRAM, KHADI JUNCTION, MUTTAKKAVU, NEDUMPANA. P.O, KOLLAM-691576.
51	DR. ATHUL AJITH, S/O AJITHA, AGED 32, MEMEBER NO. 164, PAZHAVILA,POORAM NAGAR, PULIIKKADA, KOLLAM-691001.
52	GEORGE NETTO, S/O BEN MARK. P. NETTO, AGED 54, MEMBER NO. 222, VALIYA VEEDU, NEERAVIL, PERINAD.P.O, KOLLAM- 691601.
53	N. RAJENDRAN, S/O NEELAMBARAN, AGED 68 YEARS, MEMBER NO.14, RAJASREE, VIKAS NAGAR- 185, POLAYATHODE, PATTATHANAM.P.O, KOLLAM-691021.
54	ANEESH ASOKAN, S/O ASOKAN, AGED 37 YEARS, MEMBER NO. 135, MAHIMA, ASRAMAM.RO, KOLLAM-691002.
55	M.A.BHASKRAN, S/O AYYAPPAN, AGED 86, MEMBER NO. 160, SUPRABHA, KELI NAGAR- 4, KILIKOLLOOR.PO, KOLLAM-691004.
56	DR. P. CHANDRASENAN, S/O PURUSHOTHAMAN, AGED 76 YEARS, MEMBER NO. 06, PRASANTHI, ROYAL NAGAR- 105, KILIKOLLOOR.P.O, KOLLAM-691004. BY ADVS. A.SUDHI VASUDEVAN (SR.) S.SREEKUMAR (KOLLAM) JIJI S Martin Jose P P.PRIJITH(K/233/2005) THOMAS P.KURUVILLA(K/420-B/2005) R.GITHESH(K/630/2002) AJAY BEN JOSE(K/729/2012) MANJUNATH MENON(K/000474/2015)

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SACHIN JACOB AMBAT(K/734/2016) ANNA LINDA V.J(K/1201/2020) RIZLANA NAZAR P.V.(K/002730/2022) HARIKRISHNAN S.(K/497/2019) S.SREEKUMAR (SR.)(S-571) SHILPA SATHISH JOSE JONES JOSEPH ADITH KIRAN R.S. C.A.JOJO(K/85/1996) SRI. SUDHI VASUDEVAN SR A/W SHILPA SATHISH - R1 TO R3,15,16,18 TO 24, ADV S. SREEKUMAR SR A/W P. MARTIN JOSE - R30 TO R56, S.SRREKUMAR KOLLAM - R4 TO R14.S JIJI, C.A JOJO - R17

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THIS FIRST APPEAL FROM ORDERS HAVING COME UP FOR ADMISSION ON 14.11.2022, THE COURT ON 25.11.2022 DELIVERED THE FOLLOWING:

F.A.O.No.112/2022

M.R.ANITHA, J

****************** F.A.O.No.112 of 2022

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Dated this the 25^th day of November, 2022

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JUDGMENT

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This F.A.O has been filed against the order in I.A.No.01/2021 in O.P (Society) No.122/2021 on the file of Additional District Court-IV, Kollam. Appellants are petitioners 1,

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4, 8, 10, 11 and 25 in the above interlocutory application.

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O.P (Society) No.122/2021 has been filed under Section

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25(1)(b) of the Travancore Cochin Literary Scientific and Charitable Societies Registration Act, 1995 (in short 'the T.C Act') for framing a scheme for the better and efficient management of the Sree Narayana Health Care Society (in short 'the first respondent Society') and consequential reliefs.

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The interlocutory application has been filed seeking for

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an interim injunction for restraining the respondents/executive

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committee of the first respondent society from admitting new members or altering the membership register or issuing membership of the first respondent Society to anybody till the disposal of the original petition. Petitioners who are the members of the first respondent Society alleges that first respondent society has 241 members and the petitioners represent more than 10% of the members. The first respondent society was formed in the year 2002 for establishing educational institutions like Colleges for imparting education in Medicine, Dental, Engineering, Ayurveda etc. The respondents 2 to 6 are the present office bearers in management and administration of the first respondent society. Respondents 7 to 13 are the other members of the executive committee. The first respondent society established an Ayurveda Medical College namely Sree Narayana Institute of Ayurvedic Studies and Research in the year 2004 which is affiliated to the Kerala University Health Sciences and approved by Ayush Department, Ministry of Health, Government of India with contribution of its members and availing loans from financial institutions. There are many flaws in

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the Byelaw of the first respondent society and the same is insufficient and inadequate to protect the interest of the first respondent society. The Byelaw of the first respondent society is against the scheme of the T.C Act and it is against the interest of the majority members of the first respondent society. The Byelaw has been formulated to ensure the control of members of another independent society namely Sree Narayana Educational Society (in short 'SNES') over the first respondent society. Clause in the Byelaw enabling SNES to nominate the members to general body and to the executive committee of the first respondent society is illegal and against the objective and basic structure of the society. Allotment of membership in the Byelaw is arbitrary and only to protect the interest of SNES who is not a member of the society. There is no provision in the T.C. Act for any sponsor membership in a society. The sponsor membership has been introduced in the first respondent society only to have an upper hand to SNES in the management and administration of the society. By the nomination of seven members to the executive committee by SNES, the members who are never been members

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of the society automatically gets into the executive committee, that is, against the basic structure of the society. Hence the original petition has been filed under Section 25(1)(b) of the Act to frame a scheme and for consequential relief.

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Counter affidavit has been filed on behalf of respondents 1, 2, 18, 19, 22, 25 and 27 contending that 1^st respondent is a charitable society formed/organised under the auspices of Sree Narayana Educational Society, Kollam which is also charitable society registered under the T.C.Act, 1955. SNES is established in 1986. When SNES felt the need for wider social activities taking into consideration the few developments, a decision was taken in the general body meeting of SNES to form the 1^st respondent society. Accordingly respondents 2, 3, 7, 9, 15 and 25 along with others for and on behalf of SNES associated themselves for the purposes mentioned in the Memorandum of Association of 1^st respondent have subscribed their names to the Memorandum of Association of the 1^st respondent society as predicated in the T.C.Act to form 1^st respondent society. Hence SNES is the founder of the 1^st respondent society. Goodwill and

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reputation enjoyed by the SNES helped in launching the 1^st respondent society as stated in the Memorandum of Association of the 1^st respondent society. The original petition has been filed without impleading all the members of the 1^st respondent society and also SNES. In the annual general body meeting of the 1^st respondent conducted on 21.12.2003 questions of amending the Byelaw so as to include certain clauses in the Byelaw was considered and petitioners 8, 12, 14 and 15 attended the meeting and approved the amendment. Another amendment also made during 2018 at the time when petitioners 1, 2, 3 and 32 were members of the executive committee and the respondents 5 and 6 who have been supporting the petitioners stood elected as office bearers of the society. SNES played major role in SN institute of Ayurveda Studies and Research. SNES once arranged a bank guarantee for Rs.250 lakhs by mortgaging the assets of SNES. The contention that clause 5(d)(1) of the Byelaw of the 1^st respondent society incorrectly states that SNES is the sponsoring body of the 1^st respondent society is false. Petitioners themselves acknowledges the correctness of the said

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statement incorporated in the memorandum. The role of SNES in 1^st respondent society found a place in the aims and objective of the Byelaw in view of the fact that subscribers to the formation of the Memorandum of Association. There is no legal impediment in SNES sponsoring or nominating members to the general body and executive committee of the 1^st respondent because of the unique status enjoyed by SNES. The allegation that SNES was not admitted as a member nor included in the rolls of members of 1^st respondent society is misconceived. The signatories in the Memorandum of Association and Byelaw have the same status of the members of 1^st respondent society. It is denied that 3^rd respondent has no membership in the 1^st respondent society. 3^rd respondent was a member under sponsored membership category in clause 5(d)(1) of the Byelaw and he has subscribed his name to the Memorandum of Association of the 1^st respondent. There is absolutely nothing illegal in the provisions in the Byelaw. Petitioners have not pointed out any legal impediment in this regard. Office bearers are elected by the general body consisting 255 General Body members out of 21

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nominated members is a minority. After the amendment of the Byelaw there are 32 members in the executive committee, out of which 7 are only from Clause 5(d)(1) category. If new members are not allowed to be inducted, first respondent will be deprived of the services of the new members and membership fee. No materials have been produced to substantiate mismanagement of the society by the appellants. Petitioners ought to have filed a suit for declaration that questioned provisions of bylaw are illegal and liable to struck down.

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After hearing both sides, the learned Additional District Judge found that the first respondent society is conducting educational institutions and if it is restrained from admitting new members, it would affect the source of income and proper functioning of the society and it is also found that if an injunction is not granted, no prejudice will be caused to the petitioners. So, it is found that the balance of convenience is not in favour of the petitioners and no irreparable loss would be caused to the petitioners if the injunction is not granted. Accordingly, the petition was dismissed. Against which, the appellants approached

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this Court in this first appeal.

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Notice was issued to the respondents. Heard the learned senior counsel, for the appellants as well as the contesting respondents 1 to 3, 15, 16, 18 to 29, the senior counsel for supporting respondents 30 to 56, learned counsel for respondents 4 to 14 and learned counsel for respondent No.17.

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According to the learned senior counsel for the appellants, even though appellants argued at length with respect to various documents produced from their side, no discussion has been made and those contentions have not been considered by the court below while passing the impugned order which has caused great prejudice to the appellant. It is his contention that there is a clause 5(d)(1) of the Byelaw enabling SNES as a sponsoring body of the first respondent society and sending 21 members to the general body and out of which 7 members directly would be in the executive committee of the society. That is not in tune with Section 2(b) of the T.C Act and hence is in violative of the T.C Act.

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Hence the appellants and other petitioners before the

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court below sought for framing a scheme under Section 25(b) of the T.C.Act. According to him, as per Section 25 of the T.C Act, when 10% members on the rolls of a society approaches the court concerned and the court, after enquiry, satisfied that it is just and equitable, can pass an order framing a scheme for better and efficient management of the society. The petitioners before the court below is more than 10% and hence the original petition filed by them seeking for framing a scheme is as per Section 25(1)(b) of the T.C Act. Kerala Hindi Prachar Sabha v Joseph : 2010 (4) KLT 584 was relied on by the senior counsel to support the contention that Section 25 of the T.C Act is a proceeding in the nature of suit and is a proceeding for protection of rights of the security or its members. It is also held therein that by virtue of Section 9 of the T.C.Act any order that may be passed under Section 25 of the T.C.Act is to bind all members of the society though they are not named as members. The relief claimed in the original petition is to frame a scheme to first respondent society challenging various provisions in the Byelaw

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especially Clause 5(d)(1). So the contention of the learned counsel for the contesting respondent that a suit for declaration ought to have been filed for the relief sought for by the plaintiff is prima facie not sustainable.

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Learned counsel also drew my attention to various clauses in the Byelaw including the aims and objectives, membership, sponsor membership, patron member, original member, rights of members, basic structure of the society, rights and responsibilities etc. The main contention is with regard to the concept of sponsor membership, which, according to appellants, is alien to T.C.Act. It is also contended that from 2012, till the modification of order by the trial court, no members were admitted to the society but as and when the interim order was vacated by the court below, 51 members have been newly admitted. They have also got a contention that the sponsor members are not members in the rolls of the society and the persons who are not members of the society and who are not paying any membership fee as provided under Clause 5(a) are becoming members of the society and executive committee and

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those members who are not paying any fee are pooled to the general body. If new members are admitted, the members sponsored by SNES will be having an upper hand in the administration of the society. That will not be in the interest of the first respondent society. According to him, the T.C.Act does not envisage a society to sponsor members to another society and control the affairs of another society.

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It is also contended that the present chairman and the secretary of the society are not members of the first respondent society but are members of the SNES. In short, the interest of the society and its members are not safeguarded if the administration is allowed to be continued as per the present Byelaw. So, they have sought for framing of a scheme and if an interim injunction is not granted against admitting new members, the very purpose of the suit will be a futile exercise because by the time the suit attains finality new members will be thrushed into the society at the instance of SNES and the relief sought in the original petition will become infructuous.

¶113

F.A.O.No.112/2022

¶114

¶115

Learned counsel for respondents 4 to 14 would

¶116

contend that 4^th respondent is the Treasurer of the first respondent society and the 5^th respondent is the Joint Secretary and they are not allowed to participate in any of the activities of the society. 17^th respondent filed separate objection and contended about the amendment to Clause 18 carried out by the present Executive Committee along with copy of the amended clause. It is also contended that it has been sent to the Registrar of Societies after getting the approval of Commissioner of Income Tax. But, thereafter corrections were carried out in Clause 18 which is illegal and arbitrary. But it has been contended by the learned counsel for the contesting respondents that those documents were not produced properly in compliance of Order 41 Rule 27 of the Code and hence cannot be accepted in evidence. I find substance in that argument because additional documents have to be produced at the appellate stage in compliance of Order 41 Rule 27. Hence the argument based on amendment to Clause 18 cannot be looked into at this stage.

¶117

F.A.O.No.112/2022

¶118

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Senior counsel for respondents 30 to 56 would

¶120

contend that after the interim order was modified, membership have been given to 51 new members. Argument was also advanced with respect to amendment to the Byelaw and the irregularities therein. But, as pointed out earlier, all those documents have not been produced as per law and hence, at this stage, this Court is not in a position to look into those documents. It is contended that all powers are concentrated on the executive committee instead of general body and he would contend that the present executive committee are not elected as per the Byelaw and they should not be allowed to conduct the election.

¶121

Learned counsel for respondents 1 to 3, 15, 16, 18 to 29 who are the contesting respondents (hereafter be referred as 'contesting respondents') on the other hand, would vehemently contend that there is absolutely no basis in the original petition as well as in the present petition filed by the petitioners. According to him, the aims and objectives of the first respondent society itself would make it clear that it has been constituted by

¶122

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the SNES which was established in the year 1986. It is contended that the first respondent society is the brain child of SNES and it is admitted by the petitioners that after the constitution of the first respondent society, great progress and development have been taking place and there is also huge profit to the first respondent society. So, that would speak for itself and the functioning of the society at the instance of SNES is going on in a commendable manner. It is also his contention that there is no conflict with Section 2(b) of the T.C.Act in introducing sponsor membership. He would contend that it is the SNES who has formulated this first respondent society and it is with the intention to protect their interest that a clause of sponsor membership has been provided in the Byelaw and the first respondent society has been doing the activities for the last several years without any complaint from any corners. When the appellants/the petitioners were the office bearers of the first respondent society for a term, they did not have any objection with regard to the functioning of the society and the clauses in the Byelaw during that time and only when they are out from the

¶125

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executive committee they came forward with these frivolous contentions.

¶128

It is also his contention that there is no allegation of mismanagement or any contention from the appellant/petitioners that any of the persons suggested by them were not entered as members. Membership is a source of income of the first respondent society and if it is restrained, functioning of the society would be jeopardized. He would also contend that a Society has to be left open to function as per the Byelaw and that has been settled by the Supreme Court Bar Association and

¶129

Others v. B.D.Kaushik and Another : (2011) 3 SCC 774 : 2011 (4) KLT SN 71 : 2011 KHC 4885 Paragraphs 26 and 29 were highlighted by the learned counsel wherein it has been held that

¶130

“In matters of internal management of an association, the courts normally do not interfere, leaving it open to the association and its members to frame a particular bye-law, rule or regulation which may provide for eligibility and or qualification for the membership and/or providing for limitations/restrictions on the exercise of any right by

¶131

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and as a member of the said association. It is well settled legal proposition that once a person becomes a member of the association, such a person looses his individuality qua the association and he has no individual rights except those given to him by the rules and regulations and/or bye-laws of the association."

¶134

Paragraph 29 was also highlighted by the learned counsel wherein it was held that :

¶135

“The power to amend Rules is specifically conferred under Rule 39 whereunder it is provided that the Rules and the bye-laws of the Association shall be subject to such conditions and/or modifications, as may from time to time, by resolution passed by at least 2/3rd of the Members present and voting at the General Body Meeting. Therefore, any part of the Rules could always be amended. As noticed earlier, SCBA being a Society registered under the Societies Registration Act, is governed by its Memorandum of Association. The said Association is entitled to have its own Rules and Regulations. In fact, it is contemplated in the Act that a Committee of management can be constituted to manage the affairs of the Society as specified in the Rules and Regulations. The Memorandum of Association is a contract amongst the members of the Society, which

¶136

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though required to be registered under the Statute, does not acquire any statutory character.

¶139

These are rules which govern internal control and management of the Society. The authority to frame, amend, vary and rescind such rules, undoubtedly, vests in the General Body of the Members of the Society. The power to amend the rules is implicit in the power to frame rules.

¶140

Learned counsel also relies on Shaiju K. and Others

¶141

v. Alappuzha District Co-operative Bank Ltd.No.4203 and

¶142

Others: 2018 (4) KLT 1311 : 2009 (1) KLJ 251 : 2018 (4)

¶143

KHC 880 wherein while dealing with Rule 185 of the Kerala Cooperative Societies Rules, 1969 and provisional promotion to the post of Branch Manager and the jurisdiction of writ court to interfere in the matter it has been held that since an effective statutory forum has been created under the Co-operative Societies Act for adjudication of disputes of the employees of a Co-operative banks in connection with their employment including promotion and inter se seniority High Court will not have jurisdiction under Article 226 to interference in such matters. Paragraph 34 was highlighted by the learned counsel

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wherein it has been discussed that the Byelaw that are contemplated by the Act can be merely those which govern the internal management, business or administration of a society. They may be binding between the persons affected by them, but they do not have the force of a Statute. After such Byelaws laying down the conditions of service are made and any person enters the employment of a society those conditions or service will have to be treated as conditions accepted by the employee when entering the service and will thus bind him like conditions of service specifically forming part of the contract of service. It is also held that the Byelaws that can be framed by a society under the Act are similar in nature to the Articles of Association of a company incorporated under the Companies Act and such Articles of Association have never been held to have the force of law.

¶147

It is also the contention of the learned counsel that the appellants/petitioners could not establish any prima facie case for granting a temporary injunction. Learned counsel placed reliance on Seema Arshad Zaheer and Others v. Municipal Corpn. Of

¶148

F.A.O.No.112/2022

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Greater Mumbai and Others : (2006) 5 SCC 282 : 2006 SCC Online SC 546 as well as Aysha Jasmitha.T.M v. C.P.Abdul Rasheed AIR 2021 Ker 2 : 2021 KHC 2057 which deals with the circumstances in which a temporary injunction can be granted. It is contended that as per the dictum laid down in

¶151

Oorazhma Devaswom Board, Vaduthala v. Brahmadathan Namboothiri and Others : 2014 (1) KHC 383 : 2014 (1) KLT SN 43 an application instituted by 10% of the members of the society for framing a scheme, cannot be the basis for entertaining the proceeding and that grant of discretionary relief is normally outside the scope of S.25 of the T.C.Act and can be granted only in exceptional cases, taking note that the proceedings are governed by S.141 of the Code of Civil Procedure. But, the learned counsel for the appellants in this context placed reliance on Ezhuthachan National Academy

¶152

and Others v. R.Gopinathan Nair and Others : 2019 (1) KHC 798 : 2019 (2) KLT 1073 wherein a learned Single Judge referred Oorazhma Devaswom Board to a Division Bench since it is found in conflict with Nawab Usma Ali Khan v.

¶153

F.A.O.No.112/2022

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Sagarmal : 1965 KHC 737 : AIR 1965 SC 1798 and ultimately Division Bench concluded that District Court has power to grant temporary injunction, invoking S.141 of the Code of Civil Procedure, while exercising the jurisdiction and power in an application filed under S.25 of the T.C.Act and further that District Court has inherent power also to grant temporary injunction, invoking the inherent power of the courts, which stands saved under S.151 of the C.P.C. In the impugned order the Additional District Judge has placed reliance on Oorazhma Devaswom which as rightly contended by the learned counsel for the appellant has been practically overruled by the decision in Ezhuthachan National Academy .

¶156

Even though there was a contention advanced from the side of the appellants that so many documents have been produced from the side of the appellants, none were considered while passing the impugned order, learned counsel for the contesting respondents would argue that no argument based on the documents have been advanced and the entire argument was based on the Byelaw and the violation of the provisions of the

¶157

F.A.O.No.112/2022

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T.C.Act. So also, learned counsel for the contesting respondents

¶160

have got a contention that SNES is not a party in the injunction application and though in view of the objection raised by the respondents, SNES has been made a party in the suit, in the petition still they are not party. But once party has been impleaded in the suit, consequently, the impleaded additional party to be impleaded in all pending petitions.

¶161

Though the learned senior counsel for the appellants would contend that respondents 2 and 3 Chairman and Secretary of the 1^st respondent society are not the members of the 1^st respondent society but are members of SNES, the learned senior counsel for the contesting respondents would contend that they have signed in the Memorandum of Association of 1^st respondent society and as per Section 3 of the T.C.Act, they are members of the 1^st respondent society and the contention to the contra is baseless. Section 3 of the T.C.Act provides that any seven or more persons associated for any literary, scientific or charitable purpose or for any such purpose as is described in Section 32 of the Act, may by subscribing their names to a Memorandum of

¶162

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Association and filing the same with the Registrar form themselves into a society under this Act. On perusing the Memorandum of Association, it is seen that second respondent has been signed as serial number 3 and third respondent as serial number 1 in the Memorandum of Association of the 1^st respondent society. Admittedly, the society has been registered under the T.C.Act and it has came into existence in the year 2002. So, the contention of the appellants that respondents 2 and 3 are not members of the 1^st respondent society is prima facie appears as unsustainable.

¶165

Clause 5 of the Byelaw deals with membership and sub Clause (a) provides that any individual who has completed 18 years of age and who believes and cherishes the concept of unity of India and also the teachings of Sree Narayana Guru and objectives of the society can be enrolled as a member by the executive committee of the society on payment of prescribed membership fee. Clause (d) provides that there will be three categories of members (1) sponsor membership (2) patron member and (3) ordinary member. The dispute is with regard to

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sponsor membership which reads thus:

¶169

“Sponsor membership: The Sree Narayana Educational Society is the sponsoring body of the Sree Narayana Health Care Society. The good will and the credibility of the established long standing organisation engaged in quality educational activities, social objectives etc are the asset with which the new society is launched. It is the members of Sree Narayana Educational Society who are endeavouring to establish this organization. Considering this unique status, Sree Narayana Educational Society is entitled to exercise precise control and has to be part of the governance of the Sree Narayana Health Care Society. Sree Narayana Educational Society can nominate 21 members to the General Body of which 7 will be in the Executive Committee of the society to represent it for a continuous period of three years. In case of resignation or death, if the position falls vacant, nomination can be made for the rest of the period by the sponsor society. If the sponsor member could not delegate their representative in time, it will be deemed that the constitution of the executive committee/general body is complete without them. The Sree Narayana Health Care Society will intimate the

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sponsor society one month prior to the period from which fresh delegates are to be nominated. In case any representative is disqualified by the executive committee or general body the sponsor can delegate another representative for the remaining period of the existing committee. Rs.10/- lakh will be paid by the Sponsoring Body within a period of 1 year and remaining Rs.10/lakh within a period of 3 years thereafter.”

¶173

According to the appellants and the supporting

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respondents, clause 5(d)(1) enables the SNES to nominate 21 members to the general body of which 7 will be in the executive committee of the society to represent it for a continuous period of three years and if a sponsor member could not delegate the representatives in time, it will be deemed that the constitution of an executive committee/general body is complete without them. So, according to them, the supply of sponsor members by the SNES to the general body and the stipulation that seven of them will be in the executive committee is something which is unknown to T.C.Act. It is also their contention that those 21 members who

¶175

are sponsored by the SNES are not paying any membership fee

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and is directly entering into the general body and hence it is against the express provisions of Section 2(b) of the T.C.Act. Section 2(b) is relevant in this context to be extracted which reads thus:

¶179

2(b) “Member” means a person who, having been admitted in a society according to the rules and regulations thereof, shall have paid a subscription or shall have signed the roll or list of members therof, and shall not have resigned in accordance with such rules and regulations. Explanation:- In all proceedings under this Act no person shall be entitled to vote or to be counted as a member, whose subscription at the time shall have been in arrear for a period exceeding three months;

¶180

The contention advanced by the learned counsel for

¶181

the appellants is that as per the T.C.Act also member should pay subscription as per the Byelaw and since these sponsor members supplied by SNES are not paying any membership fee, it offends Section 2(b) of the Act. But the learned counsel for the contesting respondents in this context would contend that Section 2(b) provides different types of membership i.e members

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who have paid subscription or shall have signed the roll or the list of members thereon and shall not have rescind in accordance with such rules and regulations. So, according to him, as per the Byelaw, sponsor members have signed the rolls, though that fact is disputed by the appellants. So also, explanation to Clause (b) provides that in all proceedings under this Act no person shall be entitled to vote or to be counted as a member, whose subscription at the time shall have been in arrears for a period exceeding three months. So, the explanation would qualify further that no person shall be entitled to vote or be counted as a member whose subscription at the time shall have been in arrear for the period exceeding three months. So, whether the sponsor members will satisfy the qualification provided under the explanation is a matter to be examined.

¶185

As per Clause 6(a) of the bylaw all members who have completely paid up their membership subscription are members of general body, which, mandates that in order to become members of general body the members have to be paid up their membership subscription. But 21 members nominated by the

¶186

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SNES as per Clause 5(d)(1) are not paying any subscription and are directly becoming the members of the general body is the case of the appellants. So whether Clause 6(a) of the bylaw is in conflict with clause 5(d)(1) is further a matter to be decided in the suit.

¶189

In Clause 5(d)(1) SNES is described as a sponsoring body of first respondent Society. It has also been described as sponsoring Society in clause 5(d)(1). It is also stated that in case of death or resignation if the position falls vacant and if sponsor member could not delegate their representative in time it will be deemed that constitution of the executive committee/general body is complete without them. So in clause 5(d)(1) SNES has been described as sponsoring society as well as sponsor member. It further provides that considering the unique status of SNES it is entitled to exercise precise control and has to be part of the governance of the first respondent Society. So whether another Society can control the internal affairs of the first respondent Society and whether it will be in conflict with the provisions of the TC Act is also an issue to be determined in the suit.

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F.A.O.No.112/2022

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It has been vehemently contended by the learned counsel for the contesting respondents that the sponsoring body as per Section 5(d)(1) of the Byelaw is paying Rs.20,00,000/- to the society and such a classification is permissible as per the Byelaw. In this aspect, the contention of the learned counsel for the appellant is that the concept of sponsor membership is unknown to T.C Act and it will have the effect of SNES controlling the activities and administration of the first respondent society and that according to him is not permissible under the T.C.Act. It is his contention that unlike a company incorporated under the Companies Act, T.C.Act will not enable a society to control the administration or activities of another society. So, Clause 5(d)(1) of the Byelaw of the 1^st respondent society is in violation of the express provision of the T.C.Act, the learned senior counsel contends. On going through the Companies Act, 2013, Section 2(46) defines the holding company in relation to “one or more other companies means a company of which such companies are subsidiary companies.” Section 2(87) defines subsidiary company” or “subsidiary”, in relation to any other company (that

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is to say the holding company), means a company in which the holding company - (i) controls the composition of the Board of Directors; or (ii) exercises or controls more than one-half of the total share capital total voting power either at its own or together with one or more of its subsidiary companies etc.". On looking at the T.C.Act prima facie such identical provision can not be seen for enabling a society to control or act as a subsidiary society of a main society. Learned counsel for the respondent would rely on Supreme Court Bar Association to contend that in matters of internal management of an association, the courts normally do not interfere, leaving it open to the association and its members to frame a particular bye-law, rule or regulation which may provide for eligibility and or qualification for the membership and/or providing for limitations/restrictions on the exercise of any right by and as a member of the said association. It is also held therein that once a person becomes a member of the association, such a person looses his individuality qua the association and he has no individual rights except those given to him by the rules and regulations and/or bye-laws of the association. So, according to

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contesting respondents, Memorandum of Association enables SNES to nominate 21 members to the general body and to specify out of which 7 would be to the executive committee. Memorandum of Association which provides that the name of the society; Aims and objectives of the society. It is also his contention that the first respondent society is organised under the auspices SNES and SNES was established in the year 1986 and the aims and objectives of the 1^st respondent society itself would speak in abundance the role of SNES in establishing the 1^st respondent society and the organizers felt the need for more wider social activities and taking into consideration the future developments, the 1^st respondent society has been formed. It is also provided in the aims and objectives of the 1^st respondent society that the good will and reputation enjoyed by the SNES has helped immensely in launching the first respondent society. He would also contend that even admittedly by the appellants, society has flourished a lot and there is a lot of income and there is no immediate necessity to admit new members and that itself would indicate that the 1^st respondent society is functioning

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lawfully and safeguarding the interest of the members and if an injunction as sought for by the appellants is granted, it would affect the reputation of the 1^st respondent society and also will adversely affect the progress of the society in the long run. True, Memorandum of Association would reveal that it is 'under the auspices' of SNES that 1^st respondent society has been formed.

¶202

But, at the same time, as stated earlier, it has to be examined whether Section 5(d)(1) of the Act which enables the SNES to nominate 21 members to the general body and of which 7 to be in the executive committee, is in conflict with the provisions of the T.C.Act or whether Section 4 of the T.C.Act would enable the first respondent society to include such clauses in the Memorandum of Association and Byelaw as contended by the counsel for the contesting respondents. All the issues have to be analysed in detail by the trial court while considering whether there is any necessity for framing a scheme. While sitting in appeal from an order against an interim injunction application it would not be proper on the part of this Court to make any

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observation or finding analysing the various provisions of the T.C.Act and the Memorandum of Association and Byelaw of the 1^st respondent society at this stage. At the time of argument, the learned senior counsel for contesting respondents submitted that the 1^st respondent society is not taking any new members for time being.

¶206

The argument of the counsel for the appellant as well as that of the supporting respondents that from 2012 upto the order passed by the Additional District Judge modifying the order, no new member has been admitted is not seen disputed by the contesting respondents. The submission that immediately after the interim order was vacated membership has been given to 51 new members is also not seen disputed.

¶207

In the result the impugned order is set aside and F.A.O is disposed of recording the submission of the learned counsel for the contesting respondents that the 1^st respondent is not admitting any new members at present. That position to be continued till the disposal of the suit. There will be a direction to Addl.District Judge- IV Kolllam to dispose the case at the earliest

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not later than four months from the date of receipt of copy of this judgment untrammeled by any of the observations in this FAO. Pre-trial steps to be completed by either parties within three weeks from the date of receipt of certified copy of this judgment by the trial court.

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Parties shall bear their respective cost.

¶212

(sd/-) M.R.ANITHA, JUDGE

jsr

F.A.O.No.112/2022

APPENDIX OF FAO 112/2022

¶217

RESPONDENT'S ANNEXURES:

¶218

Annexure B	True copy of Application dated 18-03-
	2022 submitted under the Right To
	Information Act before the State Public Information Officer
Annexure.A	True copy of proceeding of the
	Commissioner, Income Tax (Exemptions), Cochin dated 22-11-2019
Annexure.C	True copy of reply to Annexure-B dated 11-04-2022
Annexure.D	True copy of covering letter dated 10- 09-2021 issued by the 1st respondent along with copies of the original byelaw and byelaw amendment obtained under RTI Act
Annexure R17(2)	The 16thAnnual Report booklet containing the minutes of AGM dated 25.11.2018
Annexure R17(2)(a)	True copy of the Page 3 and 4 of R17(2) contains the minutes
Annexure R17(2)(b)	True copy of Page No. 11 to 13 the Proceedings of the Commissioner of
	Income Tax dated 22.11.2019 granting permission to amend the Memorandum of
	Association and the byelaw of the Society.
Annexure R17(1)	A copy of the so obtained byelaw is produced herewith for the kind perusal of this Honourable Court
Annexure A17(2)(c)	Page No.2 of Annexure R17(2)containing the Election Notification

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// True Copy//

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P.S to Judge

Er.Babusha.N v. Sree Narayana Health Care Society

Case brief

What is this about?

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Er.Babusha.N v. Sree Narayana Health Care Society

Case brief

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What did the court decide?

What the court decided

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