Royal Calcutta Golf Club vs Lalit Kumar Jhalaria

Bibek Chaudhuri, J

Royal Calcutta Golf Club, defendant of Money Suit No.250 of 2008 is the appellant before this court assailing the judgment and decree passed by the learned Additional District Judge, 1st Court at Alipore in Money Appeal No.3 of 2013 reversing the judgment and decree of dismissal of the said money suit passed by the learned Civil Judge (Junior Division), 1st Court at Alipore.

Factual background of the case is narrated below:-

The respondent as plaintiff filed Money Suit No.250 of 2008 against the appellant club claiming refund of the excess subscription plus service tax calculated by the appellant club from him for the period between February, 2004 to June, 2007 along with interest. The plaintiff/respondent is a permanent member of defendant/club since 1985. Sometimes in June, 2007 he came to know from other members that the appellant/club has been allowing on discounted monthly subscription to those members who had been members of the club for at least 15 years and had crossed the age of 60. The plaintiff submitted a letter on 29th June, 2007 to the appellant/club stating, inter alia, that he was a permanent member of the said club since 2nd July, 1985 and he crossed the age of 60 years on 28th January, 2004. In fact the club acknowledged the fact of plaintiff's membership and attainment of the age of 60 years on 28th January, 2004 by publishing clubs member's directory in the year 2004. So he claimed refund of excess amount of subscription which was calculated from him by the club from the month of February, 2004 to June, 2007. The General Executive Officer of the club, by a letter dated 29th June, 2007 informed the respondent that he was entitled to enjoy the benefit of discounted subscription from July, 2007 as he offered for having a senior member's discounted subscription in the month of June, 2007.

It was contended by the respondent that in Annual General Meeting of the club held on 17th September, 2004, it was resolved that the club offered a benefit of senior members discounted subscription to the members who have completed 15 years of their membership and attained the age of 60 years. However the appellant club refused to grant such benefit to the respondent on the ground that he did not approach the club for such benefits prior to June, 2007. The club never informed the plaintiff about such resolution that extended the aforesaid benefit to a class of members of the club to the plaintiff. The club also failed to notify such resolution taken in the Annual General Meeting of 2004 in terms of Rule 50 of the Bye-laws of the club. That on 10th January, 2008, the respondent finally demanded refund of the excess of subscription and service tax which the club had calculated from him during the period between February, 2004 to June, 2007. The appellant club refused and neglected to comply with such demand notice served upon it by the respondent. So was the suit.

The appellant/club contested the suit by filing written statement. The club denied all allegations made out by the plaintiff against it. Specific case of the defendant/appellant was that the club is a private limited company and it is run by its rules and regulations and bye-laws. As a veteran member, the plaintiff/respondent was aware of the rules and regulations of the club. The resolution of extending benefits of senior members discounted subscription was adopted in the Annual General Meeting of the club for the year 2004. The resolution was widely circulated in accordance with the provision of the bye-laws and the members of the club were well aware of such resolution. Benefit of discounted membership fees to a class of members is an offer on behalf of the club and in order to enjoy such offer, an eligible member must approach the club. The plaintiff approached the club to extend the offer of discounted membership fees in favour of him on 29th June, 2007. The club authority immediately granted the same allowing him to pay membership fees at discounted rate from July, 2007. The club is not obliged to extend the benefit to the members automatically on completion of 15 years of membership by the club and attainment of the age of 60 years. Since the benefit was in the nature of an offer, a member who wants to avail of such offer must intimate the club of his intention. Since the plaintiff/respondent did not inform the club for availing of such benefit, he is not entitled to get refund of money which, according to the respondent, was paid in excess of his membership fees. Therefore, the defendant/club prayed for dismissal of the suit.

On the basis of the pleadings of the parties, the learned trial judge framed the following issues:-

Whether the suit is maintainable in its present form and law?

Whether the plaintiff has cause of action to file this suit?

Is the plaintiff entitled to get the refund of the excess subscription plus Service Tax charged from the month of June 2004 till June 2007 i.e. for 37 months, or in the absence of an account from the defendant, as sum of Rs.13,000/- inclusive of interest as claimed by the plaintiff?

Is the plaintiff entitled to get the decree as prayed for?

To what other relief/reliefs, if any the plaintiff is entitled?

Parties led evidence in support of their respective cases. Series of documents were brought in evidence and marked as exhibits on behalf of both the parties. Finally on due consideration of the pleadings of the parties and evidence on record, the learned trial court dismissed the suit on contest.

The plaintiff/respondent preferred an appeal before the learned District Judge, South 24 Parganas at Alipore which was registered as Money Appeal No.3 of 2013.

The appeal was subsequently transferred to the 1st Court of the learned Additional District Judge at Alipore for hearing. By a judgment and decree dated 29th July, 2016, Money Appeal No.3 of 2013 was allowed on contest by setting aside the judgment and decree of dismissal passed by the learned trial court in Money Suit No.250 of 2008.

Accordingly, the defendant/club was directed to pay excess subscription plus service tax in favour of the plaintiff/respondent from September, 2004 to June, 2007.

The instant appeal filed by the appellant club was admitted by the Division Bench of this Court vide order dated 6th March, 2017 on the following substantial questions of law:-

Whether non-framing of the material issue as to whether the benefit which was extended to the senior members under the amended Bye-Laws could have been extended to the senior members satisfying the conditions as mentioned in the amended Bye-Laws without any application or not; vitiates the trial of the suit and/or the appeal arising therefrom or not?

Whether the benefit under the amended Bye Laws can be extended to the eligible senior members retrospectively or prospectively from the date of submission of application, if application is at all found to be necessary or not?

Mr. Saptanshu Basu, learned Advocate for the appellant/club submits before me that the learned Lower Court of appeal reversed the judgment of the trial court holding, inter alia, that the appellant/club in its 175 Annual General Meeting held on 17th September, 2004 resolved that of "A" Class members of club, who are members for over 15 years and have attained the age of 60 years and also those who are members for over 10 years and have attained the age of 70 years will become "Senior Members" of the club to avail the concessional monthly and Annual Subscription. The said resolution was adopted incorporating the rate of subscription in Rule 18(b)(i) and (ii). It is held by the learned First Appellate Court that when the rate of subscription at a discounted price was fixed in the Bye-Laws, the defendant/club was under obligation to accept membership fees at such discounted rate from the eligible members.

Mr. Basu has urged that members are under obligation to pay periodical membership fees to the club for retaining their membership. If a member tenders membership fee higher than that of which he is obliged to pay on fulfilling certain conditions, viz, 15 years of membership of the club and attainment of age of 60 years, he has to accept such offer made by the club regarding payment of membership fees at such discounted rate. The club is not under obligation to constantly consult the member's directory to ascertain the period of membership of each and individual member and their age to extend such benefit of discounted membership fees. It is pointed out by the learned Senior Counsel for the club that the respondent wrote a letter on 29th June, 2007 praying for accepting membership fee at discounted rate on his fulfilling the criteria fixed by the club, the Chief Executive Authority immediately granted such relief from July, 2007. Prior to that the respondent went on paying membership fees at the rate of applicable for permanent members. The club is not under obligation to refund the excess amount which was already paid by the respondent towards his membership fees.

Mr. Basu also submits, drawing my attention to paragraph 8 of the plaint, that the defendant/club allegedly extended the benefit of the senior members discounted subscription in favour of two other members without having any formal application from them. In support of his contention, the plaintiff/respondent failed to examine any other member of the club who was allegedly granted discounted subscription without any formal application being made to the club.

Mr. Basu further submits that the Chief Executive Officer of the defendant club deposed during the trial of the suit as DW1 on behalf of the club. In his examination-in-chief he specifically took the names of at least 13 members who requested the club to accept discounted subscription on the ground of their continued membership for 15 years and attainment of 60 years of age. They were granted such benefit from the date of application. There was no cross examination on behalf of the respondent on such statement made by DW1. It is contended by Mr. Basu that when the respondent declined to avail himself of the opportunity to put his essential and material case in cross-examination, it must follow that he believed that the testimony given could not be disputed at all. In other words if the material evidence of a witness is not challenged in cross examination by the adversary, it would be held that such evidence is admitted by the witness. In support of his contention, Mr. Basu relies upon well celebrated decision of the High Court at Calcutta in the case of A.E.G Carapiet vs. A.Y Derderian reported in AIR 1961 Cal 359.

Mr. Basu further refers to Exhibit-A which is an extract of the proceeding of 175 Annual General Meeting. The printed resolution book of the said Annual General Meeting was marked also as Exhibit-4 by the plaintiff/respondent. Referring to said resolution, Mr. Basu has urged that A class of members who completed 15 years of membership and have attained the age 60 years and also those who are members for over 10 years and have attained the age of 70 years will become "Senior Members" of the club to avail the concessional monthly and annual subscription. According to Mr. Basu, the dictionary meaning of the term "avail" is "to make use of something" or "to make advantage, utilize, employ of something". Therefore, the resolution 175 Annual General Meeting of the club was in the nature of an offer to the senior members and in order to avail of such offer, the members must apply to extend the benefit in favour of them.

Thus, it is submitted by Mr. Basu, learned Senior Counsel for the appellant/club that the learned Judge in First Appellate Court wrongly interpreted the resolution of 175 Annual General Meeting of the club and also wrongly placed responsibility upon the club to refund the portion of subscription which the respondent paid as a senior member without availing of the benefit of discounted subscription.

Mr. Soumen Das, learned Advocate for the respondent, on the other hand submits that the following factual aspects are not disputed:-

(a) The plaintiff/respondent became the member of the defendant/club on 2nd July, 1985.

(b) He attained 60 years of age on 28th January, 2004.

(c) 175 Annual General Meeting of the club was held on 17th September, 2004.

(d) The plaintiff/respondent applied for discounted subscription from the month of February, 2004 by a letter dated 29th June, 2007.

(e) The defendant/club extended such benefit to the respondent from 1st July, 2007.

Under the background of above stated admitted facts and circumstances, learned Counsel for the respondent refers to the Members Directory published in the year 2004 (Exhibit-1). Name of the respondent is appearing at page No.62. His date of birth and acquisition of membership of the club was also recorded in the said directory. According to Mr. Das, the club knew even before holding 175 Annual General Meeting the date of birth and acquisition of membership of the plaintiff/respondent. Therefore, it is the duty of the club to extend benefit of discounted subscription to the senior members automatically on fulfillment of the criteria.

Mr. Das further submits that the letter dated 29th June, 2007 written by the respondent to the club is not an application but a claim for refund of excess amount which the club had taken towards his membership fees. The club was under obligation to extend the benefit of discounted subscription to the senior members from the date of fulfillment of the criteria fixed in 175 Annual General Meeting which was incorporated in Rule 18 of the Bye-Laws updated in July, 2007.

On careful scrutiny of the Lower Court record, it is found that the Bye-Laws of the club updated in July, 2007 was filed by the plaintiff/respondent during trial of the suit which was marked as Exhibit-2, while Exhibit-B is the Bye-Laws of the club updated in October, 1997. In Bye-Laws updated in 1997, "A" class members who have been members for 25 years or more and are (i) between 60 years and 70 years of age (ii) over 70 years of age were given benefit of payment of subscription at a discounted rate. In the Bye-Laws updated in July, 2007, the said condition was amended on the basis of the resolution taken in 175 Annual General Meeting of the club and it was held that a member having been completed 15 years of membership and 60 years of age can avail of benefit of discounted membership. It is found from Exhibit-4 that the resolution adopted in 175 Annual General Meeting of the club held on 17th September, 2004 was circulated to its member including the respondent and he admitted in his examination-in-chief that he got a copy of such resolution in usual course of circulation. Therefore, the plaintiff/respondent knew about the resolution extending benefit of discounted subscription to a class of member immediately after the said resolution was published in the year 2004. In spite of such knowledge, the plaintiff/respondent did not make any application to avail of discounted subscription from the club. The terms of the said resolution was incorporated in the Bye-Laws in July, 2007. At that relevant point of time the plaintiff claimed repayment of excess subscription.

I am in agreement with the learned Advocate for the appellant that the club adopted the resolution of extending benefit to a class members by way of amendment of Bye-Laws updated 1997. It was resolved that the eligible members can "avail" such benefit. A person can be stated to have availed of something only if he has taken advantage or profited by that thing or utilized it to his benefit. The Madras High Court in R.A Mani vs. Palanimuthu Pillai reported in AIR 1969 Mad 16 defined the word 'avail' to mean 'to take advantage or utilize'. In order to avail any benefit, a member must claim such benefit. A permanent senior member having been eligible for discounted subscription, may not avail of such benefit. Question of availing a benefit arises only when the person entitled to such benefit offers to have and enjoy such benefit. An offer to avail something cannot be claimed as of right. Extending benefit of discounted subscription to the permanent senior members is not in the nature of vested right of the members, it may be held to be a right conferred upon a class of members on the basis of a resolution of Annual General Meeting of the club which was incorporated in the Bye-Laws updated in 2007. When a right of enjoyment of any benefit extended to a particular class of members by Articles and Bye-Laws of the defendant/club, such right to have the benefit is not automatic unless and until it is claimed. In other words, a right conferred by a statute, or a statutory right is not extended to a person till it's availed or claimed.

The respondent claimed such right on 29th June, 2007 and immediately the defendant/club passed an order granting such benefit from July, 2007.

In my considered view the defendant/club did not commit any wrong under the facts and circumstances of the case. Learned Judge in Lower Appellate Court committed substantial error in law holding, inter alia, that the benefit of extended subscription can automatically be granted in favour of the senior members without any offer being made by them.

Therefore, the impugned judgment passed by the learned First Appellate Court on 19th July, 2016 is liable to be set aside.

Accordingly, the instant appeal be and the same is allowed on contest, without cost.

The judgment and decree passed by the learned Additional District Judge, 1st Court, at Alipore in Money Appeal No. 3 of 2013 is set aside and the judgment and decree of dismissal of the suit passed by the learned civil judge (junior division), 1st Court at Alipore on 17th December, 2012 is restored.

Urgent photostat certified copy of this order, if applied for, be given to the parties as expeditiously as possible.