NEGOTIATIONS WITH MR AS RANA

Background

Firstly, every effort to gain information about the case from Mr K Subramanian, ex-President, Mr YS Mathur,ex-Secretary and the then MC was frustrated by their obduracy in revealing facts of the case to the members until it was too late. Secondly, the then MC deliberately concealed from the members as to how the case happened to be lost. This is explained below:

(a) In the builder – DIN CGHS Ltd agreement, there is a clause that in case of any dispute, the President of the Society will appoint a mutually acceptable arbitrator to sort out the dispute.

(b) Mr K Subramaniam, the President falsely denied holding the Contract in the Society. This has been proved by showing him a copy of the document with a receipt stamp of the Society during the Special General Body Meeting held on 07 Oct 2007.

(c) When the builder raised a demand of Rs 75, 00,000/- (Rupees Seventy Five Lakhs Only), rightfully, the President should have appointed an arbitrator as provided for in the agreement. Inexplicably, this was not done.

(d) The builder, having failed to get an arbitrator appointed by the President of DIN CGHS Ltd, approached the court of law.

(e) The court issued a notice to the President / Secretary of the Society regarding the appointment of an arbitrator. Strange as it may seem, neither the President nor the Secretary bothered to take the court notice seriously and deliberately concealed the notice from the members of the Society.

(f) The President / Secretary of the Society did not even reply to the Court’s notice.

(g) The court appointed an arbitrator to sort out the dispute. The then MC led by Mr K Subramanian did not object to appointment of the Arbitrator and, in fact,failed to react to an adverse situation developing against the Society.

(h) The Arbitrator gave an award of Rs 75, 00,000/- (Rupees Seventy Five Lakhs Only) against the Society. The then MC refused to furnish any documents of the case for information of the members. The above not withstanding, the keenness shown by Mr K Subramaniam , President and Mr YS Mathur, Secretary to safe-guard the interests of the members is evident from the ruling of the Court “ I am afraid, learned counsel for the petitioner as also the petitioner have either not understood the simple accounting mechanism or are refusing to accept the truth”. The petitioner in the case is DIN CGHS Ltd.

Delays in Handing Over of the Case File

The Managing Committee elections were forced by the order of the Hon'ble High Court of Delhi dated 12 May 2008. Even then, the previous MC led by Mr K Subramanian let the high Court deadline slip by before elections could be held through effective intervention of the RCS. The elections were finally held on 23 Aug 2008 and handing over of charge was supposed to have been completed by 06 Sep 2008 (Within 15 days). However, Mr YS Mathur and Mr Rajeev Manchanda found flimsy excuses to delay handing over of charge until 14 Sep 2008; that too with the RCS' intervention. By this time, the 'Rana Consruction Vs DIN CGHS Ltd' case had entered the crucial stage of final arguements. The implication was that no new evidence could be produced before the Hon'ble Court. The new MC was not even handed over the current case file(s) inspite of repeated requests to Mr YS Mathur and Mr Rajeev Manchanda. It was as if they were deliberately making efforts to have the case lost and make the Society to pay heavily to the contractor.

Finally, on 20 Sep 2008, Mr Kapil Bhatia briefed the MC at 1930 hrs in the Society office. Highlights of the briefing are as under:-

(a) Mr Rishi Aggarwal (Ph: 9810188705, 23354330) is handling the case on behalf of the Society and is also holding the current case files.

(b) Mr Rishi Aggarwal charges Rs 10, 000/- per appearance in court.

(c) The Society's 'grounds of appeal' were not known to Mr Kapil Bhatia and were not spelt out.

(d) All the cases on behalf of the Society were badly handled by the MC led by Mr K Subramanian and Mr YS Mathur. No one from the MC ever attended a single hearing in any court.

The Secretary contacted Mr Rishi Aggarwal on 21 Oct 2008 and fixed up an appointment for 1100 hrs on 25 Oct 2008 for a Society delegation to get a briefing on the case from him at his office at 34, Babar Lane, Bengali Market, New Delhi. At this point Mr Rishi Aggarwal expressed his unwillingness to continue with the case - obviously at the behest of previous MC. On an enquiry by the Secretary about the advisability of changing the counsel at this crucial stage, the Secretary was told by Mr Rishi Aggarwal that it was indeed not advisable. On 25 Oct 2008, Col RC Kapoor, Mr LC Tomar and Dr AK Upadhyay met Mr Rishi Aggarwal in his office and requested him to continue with the case on behalf of the Society. Mr Rishi Aggarwal declined the request siting 'heavy work load' as the reason. The Society delegation then obtained the current case file from him alongwith a letter to the effect that he was withdrawing from the case on his own.

Follow-up Action

On 26 Oct 2008, an MC meeting was held to discuss the 'Rana Case' and decide on the options available as also to formulate a strategy to deal with it. The underlying concern was the members' hard earned money at stake. Mr LC Tomar informed all present that the current case file had finally been obtained from Mr Rishi Aggarwal who had declined our request to continue with the case. After due deliberations it was decided to seek a second opinion from an expert advocate before determining future courses of action. Mr LC Tomar was requested to do the needful.

On 08 Nov 2008, Mr LC Tomar, the new advocate and handed over the case file to him for study and opinion. On 09 Nov 2008, the Secretary was contacted by Mr AS Rana for assistance required by his nephew who has purchased Flat No 108 from Mr Naru Mal. The Secretary mentioned the case and Mr Rana expressed his willingness to meet the MC to find a solution to the case. In an MC meeting held on 16 Nov 2008, the Secretary was assigned the responsibility to contact Mr AS Rana and set up a meeting with him for Sunday, 23 Nov 2008 at a time convenient to Mr AS Rana. On 21 Nov 2008, the Secretary contacted Mr AS Rana who agreed to meet the MC at 1600 hrs on 23 Nov 2008 at the Society office. He mentioned that he was willing to give any clarification on the court case but had no desire to go for an 'out of court settlement' as he had been insulted by the previous MC.

23 Nov 2008: The First Meeting With Mr AS Rana

Before the arrival of Mr AS Rana, Mr LC Tomar briefed the MC on the discussion he had with with DS Patial, the advocate hired for getting a second opinion on the Rana case. Salient points brought out by Mr LC Tomar are summarised below:-

(a) Mr DS Patial had studied the case and was of the opinion thatthe Society's case is extremely weak as vital anamolies in Mr Rana's version were not contested either in arbitration or in any other court.

(b) The fact that the final bill for work done by Rana Construction Co. was never presented and that all his calculations were based on the 18th Interim Bill, has been ignored by the previous MC. This major lapse is likely to go against the Society in the court.

(c) The escalation in cost of materials procured by the Society, included by Mr AS Rana in dues from the Society, has never been strongly highlighted by the Society in the court.

(d) Repeated requests by the Society for adjournments is bound to create a negative impression about the Society.

(e) No one from the previous MC ever attended any hearing in the case. So much for the interest taken by the MC to represent the Society in a case where a huge amount of Society funds was at stake.

(f) Mr DS Patial has recommended a negotiated 'out of court settlement' with Rana ConstructionCo.

At 1615 hrs on 23 Nov 2008, Mr AS Rana came to the Society office, having earlier accepted our invitation to come and discuss all issues involved in the case. Opening the dialogue, Mr AK Malpani, President and Col RC Kapoor, Treasurer informed Mr AS Rana that the present MC was dead serious about resolving the issue amicably and committed to preserving the interests of the Society. Mr AS Rana brought out the following points:-

(a) The previous MC had humiliated him by banning his entery into the Society and hurled insults at him by calling him a thief.

(b) He was never against an 'out of court settlement', but the previous MC never met him as an elected body; one ar two individuals used to meet him without any direction on negotiations to be pursued.

(c) His subbordinate, Mr Gopal, was unceremoniously thrown out of Flat No 110.

(d) He insisted that all allegations of theft be cleared against his name before a GBM of the Society.

(e) He is willing to discuss the case further to negotiate an 'out of court settlement'.

Finally, both sides agreed to meet again to take up the cudgels from where they were left during this meeting

14 Dec 2008: The Second Meeting With Mr AS Rana

1. An MC Meeting was held in the Society office at 1700 hrs. All MC members less Mr LC Tomar were present. The single point agenda of the meeting was to meet Mr AS Rana of Rana Construction Co. and negotiate terms for ‘out of court settlement’ of the case pending against him in High Court of Delhi

2. Before Mr AS Rana arrived, the Secretary recounted all that had transpired at the first meeting with Mr AS Rana on 23 Nov 2008. Mr AS Rana arrived at the Society office at 1730 hrs accompanied by Mr Beniwal (Bhai Saheb) and Mr BN Singh. At the outset, he enquired if the MC had any concrete offers / proposal to make. He was informed by Mr AK Malpani and Col RC Kapoor that concrete offers / proposals can only be made once the MC is convinced that he was willing for a reasonable settlement, not detrimental to larger interests of the Society, out of court. Mr Rana the made the following points:-

(a) He said all members of the Society had got a flat each for them and should be happy with that.

(b) He enquired how many unallotted flats still remained in the Society. The implication, perhaps, was that these should go to him. He was informed that 17 flats were left unallotted after the draw of lots held on 04 Oct 1998; however, these flats were subsequently allotted to new members enrolled by the then MC and these new members were now in possession of their respective flats.

(c) He said his lawyer had informed him that the Society’s dues now amounted to Rs 75 lakhs plus 108 % interest on that sum.

(d) That should the Society decide to sell any of its vacant flats, it would not be allowed to sell it at par with prevailing market rates and each flat would fetch only about Rs 37 to 38 lakhs.

(e) He agreed that the court case could drag on for another five to seven years. He seemed aware of the Society’s precarious financial situation in continuing with the case.

3. Brig Rakesh Goel categorically told him that any solution negotiated for ‘out of court settlement’ must also be beneficial for the 160 members of the Society and backed by a GBM decision as well as legally correct. All present agreed that this was sound advice and principally correct.

4. Mr. A. K. Malpani informed Mr. A.S. Rana, as done in the first meeting too, that beyond the amount deposited with Delhi High Court (Rs.37,50,000/- the Society had no other funds. He mentioned the amount spent to settle the "Chand Case" to drive home the point that some flats were indeed vacant but were disputed and had claimants who had gone to various courts to gain possession of the same.

5. Mr. Rana stated that, should such flats go to him as part of the negotiated solution, he would be responsible to deal with the legal baggage such flats carry with them. He said he would be able to deal with the contenders at his own.

6. After Mr. Rana had left, the MC mulled over his possible intentions and the options available with the Society to find a solution. All agreed that Mr. Rana had an eye on vacant flats of the Society. The Secretary was tasked to identify such flats and determine their legal status by 7 P.M. on 15th December 2008. It was also decided to explore possibility of handing over one such flat to Mr. A. S. Rana with the proviso that the Society would get back the Rs.37.5 lakhs currently under deposit with the High Court. This option may also be pursued with the approval of the GBM.