W.P (C) No.8167/2024 Page1 of 17

* IN THE HIGH COURT OF DELHI AT NEW DELHI

% Reserved on: 06

th

October, 2025

Pronounced on: 09

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April, 2026

Date of Uploading: 09

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April, 2026

+ W.P.(C) 8167/2024 & CM APPL. 33543/2024, CM APPL.

37609/2024

GOVERNMENT SERVANTS COOPERATIVE

HOUSE BUILDING SOCIETY LTD.

THROUGH GP. CAPT. (DR.) RAVINDER CHHATWAL,

SECRETARY

KALYAN KENDRA, 9 PASCHIMI MARG,

VASANT VIHAR, NEW DELHI – 110057

.....PETITIONER

Through: Mr. Neeraj Grover, Mr. Mahir

Malhotra, Ms. Smriti Pareja, Ms.

Prerna Choubey and Ms. Nitya

Vig, Advocates.

versus

1. STATE (GOVT OF NCTD OF DELHI)

THROUGH DEPARTMENT OF LAW, JUSTICE &

LEGISLATIVE AFFAIRS

8

TH

LEVEL, C WING, DELHI SECRETARIAT

PLAYERS BUILDING, IP ESTATE

NEW DELHI – 110002

…RESPONDENT NO.1

2. REGISTRAR OF COOPERATIVE SOCITIES

OLD COURT BUILDING, PARLIAMENT

STREET, NEW DELHI

…RESPONDENT NO.2

W.P (C) No.8167/2024 Page2 of 17

3. PREMIUM ESTATES PRIVATE LIMITED

76, PASCHIMI MARG, VASANT VIHAR,

NEW DELHI – 110057

…RESPONDENT NO.3

Through: Ms. Avni Singh, Panel Counsel for

GNCTD with Mr. Vaibhav

Sharma, Advocate for respondents

no. 1 and 2.

Mr. S.K. Sharma, Advocate for

respondent no. 3 along with AR.

CORAM:

HON’BLE MR. JUSTICE NITIN WASUDEO SAMBRE

HON’BLE MR. JUSTICE ANISH DAYAL

JUDGMENT

NITIN WASUDEO SAMBRE, J.

CHALLENGE

1.The petitioner, a Government Servants Cooperative House

Building Society Ltd., having its address at 9 Paschimi Marg, Vasant

Vihar, New Delhi-110057 has approached this Court through its

authorized signatory i.e. Secretary, authorized through resolution dated

06

th

April, 2024, questioning the order dated 12

th

January, 2024, passed

in exercise of review jurisdiction thereby confirming the order dated 09

th

December, 2021, passed by the respondent no.1/Financial Commissioner

in exercise of revisional jurisdiction.

W.P (C) No.8167/2024 Page3 of 17

FACTS

2. The facts which are necessary for deciding the petition are as

under:-

a)The respondent no.1 is State Government, respondent no.2 is the

Registrar of Cooperative Societies, and the respondent no.3 a

Private Limited Company.

b)Respondent no.3 claimed to have purchased property bearing no.

76 Paschimi Marg, Vasant Vihar, New Delhi from one M/s RM

Textiles.

c)Based on title deed, respondent no.3 applied for membership of the

petitioner- society on 11

th

January, 2019.

d)The request of respondent no.3 was considered by the petitioner-

society in the light of the prevailing byelaws, which were

approved by the respondent no.2 in 2013, and rejected the prayer

for grant of membership vide order dated 30

th

January 2019 for the

following reasons:-

i.That respondent no.3, is not eligible to be a member of

the society as per byelaw no.5(1);

ii.A person cannot be admitted to be a member as he is

not eligible, since he deals with the sale and purchase of

immovable properties, either as a principal or as an

agent, as provided in Rule 20(ii) of Delhi Co-operative

Societies Rules, 2007 (‘DCS Rules’).

W.P (C) No.8167/2024 Page4 of 17

e)The respondent no.3 feeling aggrieved by the aforesaid order of

the petitioner dated 30

th

January, 2019, rejecting the prayer of

respondent no.3 to be enrolled as a member, approached the

respondent no.2/Registrar of Cooperative Societies by invoking

the remedy available under Section 91 of the DCS Act in the form

of an appeal.

f)The respondent no.2 allowed the said appeal vide impugned order

dated 12

th

July, 2019, whereby directions were issued to the

petitioner-Society to transfer the membership in favour of the

respondent no.3.

g)Since the petitioner-society was aggrieved by the order dated 12

th

July, 2019, a recall/revision was preferred before the Financial

Commissioner questioning the aforesaid order of the respondent

no.2.

h)The said revision came to be dismissed by the Financial

Commissioner i.e. State Government vide its order dated 09

th

December, 2021, with an observation that respondent no.3 would

drop the disputed clause viz.“Dealing with sale and purchase”

from the Memorandum of Association and Article of Association

of respondent no.3. In turn, the petitioner was directed to allow the

request of respondent no.3 for grant of membership.

i)Since the remedy of review was available to the petitioner, same

was invoked questioning the order, seeking review of the order

dated 09

th

December, 2021 before the respondent no.1.

W.P (C) No.8167/2024 Page5 of 17

j)Vide impugned order dated 12

th

January, 2024, the review petition

came to be dismissed, as such this petition.

SUBMISSIONS

3.The respective counsels took us through both the impugned orders,

dated 09

th

December, 2021 and 12

th

January, 2024, passed by the

Financial Commissioner.

4.The learned counsel for the petitioner urged that the respondent

no.2 has directed transfer of the membership in favour of the respondent

no.3, granted earlier in favour of the predecessor-in-title of the said

respondent.

5.According to him, the “transfer of the membership” and “grant of

membership” are two different things.

6.The learned counsel would further urge that the entitlement of a

party to membership must be judged on the date it applied for the

membership and not based on subsequent developments viz. like in the

present case, the relevant disputed clause was directed to be amended by

the respondent no.3 vide impugned order passed by respondent no.1.

7.The learned counsel further urged that, even otherwise, petitioner

has every right to decide the application for membership having regard to

the statutory right of respondent no.3 and as it cannot claim any

fundamental right to be a member of a cooperative society.

8.The learned counsel would urge that the respondent no.3 is a

registered company and not an individual. Admittedly, respondent no.3 is

dealing with the immovable property, and in such an eventuality, rightly

W.P (C) No.8167/2024 Page6 of 17

so, the membership was rejected having regard to the embargo created by

the byelaws viz. byelaw no. 5(1) and the condition that a member should

not be in the business of real estate.

9.According to him, order passed by the revisional authority dated

09

th

December, 2021, is sought to be explained while deciding the review

jurisdiction. The order passed by the revisional authority dated 09

th

December, 2021 reads thus:-

W.P (C) No.8167/2024 Page7 of 17

10.The review jurisdiction cannot be invoked for the purpose of

explaining an order passed by the respondent no.1. He would claim that

the view expressed by the respondent is in contravention to the judgment

of the Apex Court in the matter of “Zoroastrain Cooperative Housing

Society Limited & Ors. Vs. District Registrar Co-operative Societies

and Ors.” 2019 3 SCC 745.

11.According to him, the respondent no.1 has failed to consider that

on the date of the application, the respondent no.3 was not qualified to be

a member, a fact inferred from the impugned order dated 09

th

December,

2021, and in such an eventuality, the order impugned cannot be said to be

sustainable.

12.The counsel for the petitioner has drawn support from the clause

5(1) of the byelaws, which reads thus:-

“5. Admission of members

(1)No person shall be admitted as a member of the

Society under Bye-law 4(2) except the

following:

(a)An individual competent to contract under

(section 11 of the Indian Contract Act, 1872 (9

of 1872);

(b)an individual who is not a member of any other

co-operative housing society in NCT of Delhi;

(c) an individual who owns a plot I floor I dwelling

unit in Vasant Vihar or Shanti Niketan either by

assignment or by inheritance. Provided the

number of members in respect of a plot shall

not exceed the number of dwelling units

permissible for the specific size of the plot

under the master plan of Delhi as may be

inforce from time to time.

(d)the individual is a citizen of India, except in

case of legal heir;

W.P (C) No.8167/2024 Page8 of 17

(e)the age of individual is more than 18 years,

except in the case of minor heir of a deceased

member;

(f) the individual does not own a residential

house or a plot of land for construction of a

residential house in any of the approved or un-

approved colonies or other localities in the

NCT of Delhi in his/her own name or in the

name of his/her spouse or any of the dependent

children either on lease-hold or free-hold.”

13.Drawing support from the Rule 19 of the DCS Rules, 2007, it is

his contention that the society is armed with the powers to deal with the

requests for the grant of membership.

14.It is further claimed that even Section 22 of the DCS Act supports

the case of the petitioner.

15.As against above, the learned counsel for the respondents have

opposed the prayer. According to the counsel for the respondents the

order of the transfer of the membership passed by respondent no.2 is

valid in law which has given the cause for the petitioner to take recourse

to the revisional jurisdiction.

16.It is their contention that the respondent no.1 has passed a

workable order, thereby accepting the contention of the petitioner, that

respondent no.3-Company would drop the disputed clause from the

Memorandum of Association and Article of Association and consequent

thereupon, the petitioner has to take further action as if the clause never

existed.

17.The aforesaid order was based on the fact that respondent no.3 had

never transacted as per the said disputed clause.

W.P (C) No.8167/2024 Page9 of 17

18.The petitioner-society was directed to make every endeavor to

allow the request.

19.According to them, it is only an invocation of review jurisdiction

by the petitioner; the authority passed a detailed order thereby

considering the legal submissions.

20.The counsel for the respondent no.3 has claimed that the order

impugned are in conformity with Section 22 of the DCS Act.

21.It is further claimed that, in case, if the byelaws are permitted to

prevail, same will negate the statutory mandate under Sub-section (2) of

Section 11 of the DCS Act.

22.It was his further contention that in the hierarchy, the Act shall

always prevail over the rule and byelaws, whereas rules shall prevail

over the byelaws and not over the Act. Support is drawn from the

judgment in the matter of “State of U.P. and Ors. Vs. C.O.D. Chheoki

Employees' Co-op. Society Ltd. and Ors.” (1997) 3 SCC 681.

23.According to the counsel for the respondent, the judgment in the

matter of “Zoroastrain Cooperative Housing Society Limited &Ors”.

(supra) will not have the applicability to the factual matrix of the present

case, as the Apex Court in the said case was confined to the membership

to the extent of a particular community, which is not similar to the facts

of the case in hand.

24.Similarly, it is claimed that two authorities have concurrently held

against the petitioner and that being so, no interference in extra-ordinary

jurisdiction is called for, accordingly, the dismissal of the present petition

W.P (C) No.8167/2024 Page10 of 17

is sought.

25.Similarly, respondent no.3 has drawn support from the provision

of Section 11, Section 20 and Rule 20 of the Act and Rules respectively.

26.The said provisions read thus:

RELEVANT PROVISIONS:

Section 11 of DCS Act

11. Bye-laws of co-operative societies.

(1) Every co-operative society may make its bye-laws

consistent with the provisions of this Act and the rules made

thereunder.

(2) In particular and without prejudice to the generality of

the foregoing power, such bye-laws may provide for all or

any of the following matters, namely:-

(a) The name, address and area of operation of the society;

(b) the objects of the society:

(c) the services to be provided to its members;

(d) the eligibility for obtaining membership;

(e) the procedure for obtaining membership;

.

.

.

Section 22 of DCS Act

22. Persons who may become members.

(1) No person shall be admitted as member of a co-operative

society except the following, namely -

(a) an individual competent to contract under section 11 of

the Indian Contract Act, 1872 (9 of 1872):

(b) any other co-operative society;

(c) the Government;

(d) a firm, a joint stock company, or any other body

corporate constituted under any law; and

W.P (C) No.8167/2024 Page11 of 17

(e) such class or classes of persons or association of persons

as may be notified by the Government in this behalf:

Provided that the provisions of clause (a) shall not apply to

an individual seeking admission to a co-operative society

exclusively formed for the benefit of students of a school or

college:

Provided further that no individual shall be eligible for

admission as a member of any financing bank or federal co-

operative society except as provided in clause (m) of section

(2) Notwithstanding anything contained in sub-section (1),

the Government may, having regard to the fact that the

interest of any person or class of persons conflicts or is likely

to conflict with the objects of any co-operative society or

class of co-operative societies by general or special order.

published in the official Gazette, declare that any person or

class of persons engaged in or carrying on any profession,

business or employment shall be disqualified from being

admitted, or for continuing as member or shall be eligible for

membership only to a limited extent of any specified co-

operative society or class of co-operative societies, so long as

such person is or such persons are engaged in or carrying on

that profession, business or employment, as the case may be.

Rule 20 of the DCS Rules

20.Disqualification of membership

(1) No person shall be eligible for admission as a member of

a co-operative society if he:-

(a) has applied to be adjudicated an insolvent or is an

undischarged insolvent,

Or

(b) has been sentenced for any offence other than an offence

of a political character or an offence not involving moral

turpitude and dishonesty and a period of five years has not

elapsed from the date of expiry of the sentence,

Or

(c) In the case of membership of a co-operative housing

society,

W.P (C) No.8167/2024 Page12 of 17

(i) owns a residential house or a plot of land for construction

of residential house in any of the approved or un-approved

colonies or other localities in the National Capital Territory

of Delhi, in his own name or in the name of his spouse or any

of dependent children, on lease hold or free-hold basis or on

power of attorney or on agreement for sale:

Provided that above clause shall not be applicable,

(a) in case of co-sharers of property whose share is less than

66.72 sq. metres of land; or if the residential property

devolves on him by way of inheritance,

(b) in case of a person who has acquired property on power

of attorney or through agreement for sale and on conversion

of the property from leasehold to freehold on execution of

conveyance it, if such person applies for the transfer of

membership housing society concerned,

(ii) deals in purchase or sale of immovable properties either

as principal or as agent in the National Capital Territory of

Delhi; or

(iii) his spouse or any of his dependent children is a member

of any other co-operative housing society.”

27.According to respondent no.3, the provision of the Section 22 shall

prevail over the rules and the byelaws and that being so, the order of

respondent no.1 shall prevail.

28.Thus, the dismissal of the present petition is sought.

ANALYSIS

29.We have considered the rival claims.

30.It is not in dispute that respondent no.2, in exercise of appellate

jurisdiction, has directed transfer of membership in favour of the

respondent no.3.

31.That the predecessor-in-title of respondent no.3, was a member of

W.P (C) No.8167/2024 Page13 of 17

the petitioner-society is borne out of the record and is an admitted fact.

32.However, just because the respondent no.3, has purchased the

property vide a registered deed, that by itself will not transfer the right

and interest of membership in the petitioner-Society in favour of

respondent no.3.

33.Membership of a cooperative society, in our opinion, cannot be

said to be an attachment to the title to the property which was transferred

to respondent no.3, as such does not appear to be the statutory mandate

under Section 3 read with Section 8 of the Transfer of Property Act,

1882.

34.Perhaps, such position of law has prompted the respondent no.3 to

apply for grant of membership in its favour with the petitioner.

35.It is not in dispute that the petitioner has rejected the request of

respondent no.3 based on the byelaws.

36.Amongst other, the Memorandum of Association and Article of

Association of respondent no.3 prescribes it to deal in the real

estate/property. It is an express provision in the byelaws of the petitioner-

society that a person dealing with property cannot be accepted or granted

membership of the petitioner-society.

37.The fact remains, on the date of the application for membership by

respondent no.3, or even on the date of the purchase of property,

respondent no.3 was dealing with immovable property and impact of

such clause in its Memorandum of Association and Article of

Association, in view of byelaws, disentitled the respondent no.3 to seek

W.P (C) No.8167/2024 Page14 of 17

membership of the petitioner-society.

38.Even if, the provisions of Section 22 will have the overriding

effect over the byelaws, however, we are equally required to be sensitive

to the sub-clause (d) of sub-section (2) of Section 11 of the DCS Act,

wherein the power to frame eligibility conditions for obtaining

membership is prescribed.

39.Similarly, Section 22 though contemplates that a body corporate

may ask for the membership, however, a plain reading of the said

provision only provides that a body corporate can be a member, but it is

not provided that the byelaws can be bypassed for the said purpose.

40.Be that as it may, we are of the view that the respondent no.1 has

committed an error in passing order dated 09

th

December, 2021, thereby

directing the petitioner to make an endeavor to allow the request of the

respondent no.3 to grant membership, provided respondent no.3 deletes

the disputed clause from Memorandum of Association and Article of

Association.

41.The aforesaid observation, in our opinion, was in view of the fact

that on the date of application, there existed an embargo by virtue of

existence of a clause in the Memorandum of Association and Article of

Association which runs contrary to the byelaws, seeking membership of

petitioner-society.

42.One can understand that respondent no.1 in such an eventuality,

permitted the respondent no.3 to delete such disputed clause from its

Memorandum of Association and Article of Association and then apply

W.P (C) No.8167/2024 Page15 of 17

to the petitioner-society for grant of membership. However, such

exercise in our opinion is at all not permissible in the wake of the scope

of revisional or review jurisdiction. This legal position is strengthened by

the judgment of the Supreme Court in the matter of “Malleeswari Vs. K.

Suguna and Another (2025 SCC Online SC 1927)”, which states under:

“17. Having noticed the distinction between the power of

review and appellate power, we restate the power and scope

of review jurisdiction.

Review grounds are summed up as follows:

17.1 The ground of discovery of new and important matter or

evidence is a ground available if it is demonstrated that,

despite the exercise of due diligence, this evidence was not

within their knowledge or could not be produced by the party

at the time, the original decree or order was passed.

17.2 Mistake or error apparent on the face of the record may

be invoked if there is something more than a mere error, and

it must be the one which is manifest on the face of the record.

Such an error is a patent error and not a mere wrong

decision. An error which has to be established by a long-

drawn process of reasoning on points where there may

conceivably be two opinions can hardly be said to be an

error apparent on the face of the record.

17.3 Lastly, the phrase ‘for any other sufficient reason’

means a reason that is sufficient on grounds at least

analogous to those specified in the other two categories.”

43.The revision was, in fact, preferred by the petitioner and it was

expected of the revisional authority to deal with it having regard to the

provisions of Section 11 and 22 of the DCS Act and the byelaw no. 5 of

the petitioner-society.

44.The impugned order dated 09

th

December, 2021 is not dealing with

such issues. Rather it appears that the order was passed by respondent

no.1 based on certain concessions made by respondent no.3 which in fact

W.P (C) No.8167/2024 Page16 of 17

were not acceptable to the petitioner. Merely because respondent no.3

has made certain concession, such concessions in the pending

proceedings are not binding on the petitioner and it was expected of

respondent no.1 to deal with the contention of the parties in its entirety in

revisional jurisdiction and not in the review jurisdiction.

45.Further, the review jurisdiction is always confined as to whether

exists an error apparent on the face of the record, which warrants the

order of which review is sought to be recalled or set-aside.

46.The error apparent on the face of the record is interpreted to mean

that such error which can be traced without referring to the documents

and record of the case.

47.A perusal of the order under review, which is impugned in the

present petition, primarily speaks of the revisional authority and while

exercising the powers of review for dismissing the review application,

has re-written the judgment as if it is re-appreciating the entire

contentions and the law. Such exercise is not permissible for the

reviewing authority to substantiate it by supplementing the reasons.

48.That being so, we are of the view that the order of the revisional

authority and the order of the reviewing authority which are impugned in

the present petition, are not sustainable.

49.We deem it appropriate to quash and set-aside the impugned order

09

th

December, 2021, so also the order dated 12

th

January 2024 passed in

exercise of review jurisdiction.

50.We permit the parties hereto, to appear before the revisional

W.P (C) No.8167/2024 Page17 of 17

authority i.e. respondent no.1 on 27

th

April, 2026.

51.We request the revisional authority to make an endeavor to decide

the revision petition within a period of six months from the date of

appearance of the parties.

52.Such revision shall be decided without being influenced by the

finding recorded hereinabove.

53.Pending applications, if any, also stands disposed of.

54.Judgment be uploaded on the website of this Court.

NITIN WASUDEO SAMBRE

(JUDGE)

ANISH DAYAL

(JUDGE)

APRIL 9, 2026/sky/st/sk