Holding

The Court held that alienation of property charged under Section 48 of the Maharashtra Co‑operative Societies Act is voidable and can be set aside only by the society itself; absent any action by the society, the transactions remain voidable but not void ab initio, and the plaintiff cannot claim relief based on his own breach.

Summary

The plaintiff, a member of a cooperative society, obtained a loan from the society and created a charge on his ancestral agricultural land. He later sold the land to his nephew/son‑in‑law (defendant 1) on 2 Nov 1971 without repaying the loan or obtaining the society’s consent, and defendant 1 subsequently sold part of the land to defendant 2 on 15 July 1972. The society released the charge on 27 Aug 1973 after the loan was repaid, but it never challenged the earlier alienations. The issue before the Supreme Court was whether the sale deeds were void under Section 48(e) of the Maharashtra Co‑operative Societies Act and whether the later release of the charge could retrospectively validate them, and who has standing to invoke the void‑ability provision. The Court held that alienation of charged property without the society’s consent is voidable, not void ab initio, and that only the society can invoke Section 48(e); since the society never sought nullification, the transactions remain voidable but not set aside, and the plaintiff cannot benefit from his own wrong. Consequently, the appeal was dismissed, upholding the lower courts’ decisions.

Issues considered

Whether the conveyance of the suit land on 02.11.1971 by the plaintiff, who had a charge created in favour of the cooperative society, could be lawfully effected and sustained.
Whether the subsequent release of the charge by the society on 27.08.1973 gives retrospective effect to validate the sale deeds dated 02.11.1971 and 15.07.1972.
Against whom, if at all, the alienation under Section 48(e) of the Maharashtra Co‑operative Societies Act, 1960 is applicable, i.e., who has locus standi to invoke the provision.
Whether the sale deeds are void ab initio or merely voidable under the Act.

Legislation cited

Maharashtra Co-operative Societies Act, 1960s. 47, s. 48(a), s. 48(b), s. 48(c), s. 48(d), s. 48(e), s. 48(f), s. 48(g)
Prevention of Fragmentation and Consolidation of Holdings Act, 1947

Headnote

Issue for Consideration Whether the conveyance of the suit land by dated 02.11.1971 in favour of defendant no.1 could have been done and, the same having been done, could be sustained in law; whether the subsequent release of the charge created on the suit land by the Society upon receiving the entire dues having been paid by the plaintiff, would give

Subjects

Alienation under Section 48(e) of the Maharashtra Co-operative Societies Act, 1960Co-operative SocietyMember of the Co-operative SocietyMember-loaneeCharge created on immovable property under declarationCharge created on ancestral propertyCharge on the suit landRelease of the charge created on the suit landAlienation of charged propertyConveyance of the suit landRe-conveyance deedSale deedLoan obtained from the SocietyKendal Bk. Vividh Karyakari Seva Sahakari Sanstha LimitedDecree of possessionPossession and re-conveyance of suit landBonafide purchaseBenefit from own wrongVoidable actionNot void ab initioDirectoryEx injuria sua nemo habere debet

Judgment

[2025] 7 S.C.R. 307 : 2025 INSC 795

Machhindranath S/o Kundlik Tarade Deceased
Through LRs.
A1: Bhagirathibai
A2: Ashabai
A3: Bhaussaheb
A4: Meenabai
v.
Ramchandra Gangadhar Dhamne & Ors.
R1: Ramchandra Gangadhar Dhamne
R2: Ashok
R3: Chhaya Babasaheb Gadhe
R4: Nareshkumar Babasaheb Gadhe
R5: Balasaheb
(Civil Appeal No. 7277 of 2025)
02 June 2025
[Sudhanshu Dhulia and Ahsanuddin Amanullah,* JJ.]

Issue for Consideration
Whether the conveyance of the suit land by the original plaintiff
dated 02.11.1971 in favour of defendant no.1 could have been
done and, the same having been done, could be sustained in law;
whether the subsequent release of the charge created on the suit
land by the Society upon receiving the entire dues having been
paid by the plaintiff, would give retrospectivity to the said release
so as to validate and ratify the Sale Deeds dated 02.11.1971 and
15.07.1972; against whom or between whom, if at all, any alienation
under Section 48(e), Maharashtra Co-operative Societies Act, 1960
is applicable for the said acts resulting in the same being void.

Headnotes†
Maharashtra Co-operative Societies Act, 1960 – s.48(e) –
Plaintiff, a member of the Co-operative Society obtained a loan
from the Society and created a charge on his ancestral property
(the suit land) in favour of the Society – Later, plaintiff also
obtained loan from defendant no.1 and executed a Registered
Sale Deed dated 02.11.1971 of the suit land in his favour and
defendant no.1 executed a re-conveyance deed – However,
defendant no.1 executed a Registered Sale Deed in favour
* Author
308 [2025] 7 S.C.R.

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of defendant no.2 in respect of certain portion of the suit
land – Plaintiff sought possession and re-conveyance of the
suit land – Trial Court declared sale deed dated 02.11.1971 as
void u/s.48 and ordered re-conveyance of suit land in favour
of plaintiff – Eventually, Single Judge set aside the decree
of possession and dismissed the plaintiff’s suit – Appeal
dismissed by Division Bench – Challenge to:
Held: s.48(e) declares void any transaction by a member-loanee
against the society, where he/she alienates such immovable
property on which a charge is created under declaration –
Alienation of any such property on which a charge is created in
favour of the concerned co-operative society by way of declaration
is beyond the capacity of the owner/member who has declared
it as a charged property, until the amount, for which the charge
was created along with the interest, is repaid in full – However,
even if a part of the amount due is paid then the society may, on
an application moved by the member, release from charge such
part of the property, as it may deem proper having regard to the
outstanding amount – The right to sue or get a declaration qua
any alienation made by a loanee is available only to the society in
favour of whom the property under a declaration was charged –
Thus, with regard to a transaction, unless the society comes
forward to seek its nullification/setting aside, the same would be
a voidable action and not void ab initio – Neither the amount for
which the charge was created was repaid to the Society either in
full or in part nor any such application for part-release was either
filed before or accepted by the Society prior to the sale deed dated
02.11.1971 in favour of defendant no.1 – The Society had itself
resolved to release the charge on the suit land on 27.08.1973 – It
never moved before any forum for enforcing its charge over the
suit land or raised any grievance w.r.t either of the Sale Deeds –
Plaintiff cannot be allowed to benefit from his own wrong – Single
Judge and the Division Bench committed no error – No merit in
the appeal. [Paras 20-22, 24, 25, 32-34]

Maharashtra Co-operative Societies Act, 1960 – s.48(e),
directory:
Held: s.48(e) which says that any alienation made in contravention
of the provisions of clause (d) shall be void has to be read as
directory to the extent that the same can be acted upon only at
the instance of the party aggrieved (viz. the society concerned)
upon whom the right has been created under the statute. [Para 25]
[2025] 7 S.C.R. 309

Machhindranath S/o Kundlik Tarade Deceased Through LRs. v.
Ramchandra Gangadhar Dhamne & Ors.

Case Law Cited
C S Venkatesh v. A S C Murthy [2020] 2 SCR 676 : (2020) 3
SCC 280; State of Rajasthan v. Shiv Dayal [2019] 10 SCR 243 :
(2019) 8 SCC 637; Sindav Hari Ranchhod v. Jadev Lalji Jaymal
[1997] Supp. 3 SCR 41 : (1997) 7 SCC 95; Dhurandhar Prasad
Singh v. Jai Prakash University [2001] 3 SCR 1129 : (2001) 6
SCC 534; Ram Pyare v. Ram Narain [1985] 2 SCR 918 : (1985)
2 SCC 162; Kusheshwar Prasad Singh v. State of Bihar [2007] 4
SCR 95 : (2007) 11 SCC 447 – referred to.

List of Acts
Maharashtra Co-operative Societies Act, 1960; Prevention of
Fragmentation and Consolidation of Holdings Act, 1947.

List of Keywords
Alienation under Section 48(e) of the Maharashtra Co-operative
Societies Act, 1960; Co-operative Society; Member of the Co-
operative Society; Member-loanee; Charge created on immovable
property under declaration; Charge created on ancestral property;
Charge on the suit land; Charge created on ancestral property (the
suit land) in favour of the Co-operative Society; Release of the
charge created on the suit land; Alienation of charged property;
Conveyance of the suit land; Re-conveyance deed; Sale deed;
Loan obtained from the Society; Kendal Bk. Vividh Karyakari Seva
Sahakari Sanstha Limited; Decree of possession; Possession and
re-conveyance of suit land; Bonafide purchase; Benefit from own
wrong; Voidable action; Not void ab initio; Directory; Ex injuria sua
nemo habere debet.

Case Arising From
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 7277 of 2025
From the Judgment and Order dated 15.01.2019 of the High Court
of Judicature at Bombay at Aurangabad in LPA No. 33 of 1998

Appearances for Parties
Advs. for the Appellants:
Sandeep Sudhakar Deshmukh, Nishant Sharma, Ankur S.
Savadikar.
310 [2025] 7 S.C.R.

Supreme Court Reports

Judgment / Order of the Supreme Court

Judgment

Ahsanuddin Amanullah, J.

Leave granted.
2. The present appeal impugns the Final Judgment and Order dated
15.01.20191 in Letters Patent Appeal (hereinafter abbreviated as
‘LPA’) No.33/1998 in First Appeal No.624/1992 (hereinafter referred
to as the ‘Impugned Order’) passed by the High Court of Judicature
at Bombay, Bench at Aurangabad (hereinafter referred to as the
‘High Court’), whereby the appeal preferred by the appellants was
dismissed and Judgment and Order dated 17.09.1993 [1994 MhLJ
558] in First Appeal No.624/1992 passed by the learned Single
Judge of the High Court was affirmed. The learned Single Judge
differed with the Judgment and Order dated 27.03.1980 in Special
Civil Suit No.49/1973 passed by the learned Civil Judge, Senior
Division, Ahmednagar (hereinafter referred to as the ‘Trial Court’)
and set aside the decree of possession so granted by the Trial Court.

PARTIES:
3. The appellants before us, along with respondent no.5, are the
Legal Representatives (hereinafter abbreviated to ‘LRs’) of the
original plaintiff. Respondent no.1 is the original defendant no.1 and
respondents no.2 to 4 are the LRs of the original defendant no.2.
Despite valid service of notice, no one has entered appearance on
behalf of respondents no.1, 2, and 5. Though, when the matter was
heard and judgment was reserved by this Court, learned counsel for
respondents no.3 and 4 was not present, however, subsequently, in
terms of the Order dated 17.12.2024, a note of written submissions
has been filed on their behalf, which is taken on record.

FACTUAL MATRIX:
4. For the sake of convenience and clarity of facts, the parties shall be
referred to as per their status/position in the suit. The suit property is

1 Cause Title corrected by the High Court vide Speaking to Minutes Order dated 11.09.2019.
[2025] 7 S.C.R. 311

Machhindranath S/o Kundlik Tarade Deceased Through LRs. v.
Ramchandra Gangadhar Dhamne & Ors.

agricultural land bearing Survey No.30 situated at Village Kendal Bk.,
Taluka Rahuri, Ahmednagar, Maharashtra admeasuring 15 Acres and
17 Guntha (hereinafter referred to as the ‘suit land’). The suit land
was the ancestral property of the original plaintiff-Machhindranath.
On 20.04.1956, the plaintiff enrolled as a member of the Kendal Bk.
Vividh Karyakari Seva Sahakari Sanstha Limited (hereinafter referred
to as the ‘Society’), which, admittedly, is a registered Co-operative
Society in terms of the provisions of the Maharashtra Co-operative
Societies Act, 1960 (hereinafter referred to as the ‘Act’). Thereafter,
the plaintiff obtained a loan from the Society, which was to be repaid
by 09.11.1971, and created a charge on the suit land in favour of
the Society. A declaration to this effect was made by the plaintiff on
15.08.1969 and subsequently, Mutation Entry no.3346 came to be
recorded on 09.09.1969 mentioning this declaration.
5. As things stood, the plaintiff found himself in a financial crunch
and approached defendant no.1 for a loan of Rs.5,000/- (Rupees
Five Thousand). Defendant no.1 was none other than the plaintiff’s
nephew as also his son-in-law. Defendant no.1 extended such
loan and as security, the plaintiff executed a Registered Sale Deed
dated 02.11.1971 of the suit land in his favour. On the same day, a
document styled as ‘Ram Ram Patra’ (hereinafter referred to as the
‘Reconveyance Deed’) was executed by defendant no.1 mentioning
that the total value of suit land is around Rs.25,000/- (Rupees
Twenty-Five Thousand) and that he would re-convey the suit land
on repayment of Rs.5,000/- (Rupees Five Thousand). Mutation Entry
no.3520 came to be recorded in the name of defendant no.1 qua
the suit land on 24.12.1971.
6. On 15.07.1972, defendant no.1 executed a Registered Sale Deed
in favour of defendant no.2 in respect of 10 Acres of the suit land
for a consideration of Rs.30,000/- (Rupees Thirty Thousand). As a
consequence of the said Sale Deed dated 15.07.1972, Survey No.30
came to be divided in two parts. The land sold to defendant no.2 was
Survey No.30/1 and the remaining portion became Survey No.30/2.
On knowledge of the Sale Deed executed by defendant no.1 in
favour of defendant no.2, the plaintiff approached the Trial Court on
28.02.1973 by filing Special Civil Suit No.49/1973 seeking possession
of Survey Nos.30/1 and 30/2 and a direction for re-conveyance of
the same along with mesne profits. After the institution of the suit,
312 [2025] 7 S.C.R.

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defendant no.2 filed an application to the Society to strike off its charge
on the suit land. Vide a Resolution dated 03.04.1973, the Society
resolved that the charge would be struck off only after a compromise
takes place in respect of the land. However, subsequently, by a
Resolution dated 27.08.1973 passed by the Society, the suit land
came to be released by the Society from its charge, on account of
repayment of the loan by the plaintiff.
7. After considering the evidence placed on record by the parties,
the Trial Court held, vide Order dated 27.03.1980, that the Sale
Deed dated 02.11.1971 was void under Section 48 of the Act and
that defendant no.2 had failed to prove that he was a bonafide
purchaser for value without notice. However, on the question of
bar under the Prevention of Fragmentation and Consolidation of
Holdings Act, 1947 (hereinafter referred to as the ‘Fragmentation
Act’), the Trial Court found that the alienation was in pursuance of
the Certificate granted under the Fragmentation Act. In the result,
Trial Court passed a decree for possession of the suit land with
direction to defendant no.1 to execute the deed of reconveyance
of the suit land in favour of the plaintiff after receiving Rs.5,000/-
(Rupees Five Thousand) from him.
8. Against the decree supra, defendant no.2 initially approached
the High Court of Judicature at Bombay by filing First Appeal
No.457/1980, which was later transferred to the Aurangabad Bench
and re-numbered First Appeal No.624/1992. The learned Single
Judge vide Order dated 14.10.1988 remanded the matter to the
Trial Court, by framing four additional issues. On remand, the
Trial Court considered the four issues with fresh evidence of the
parties, and vide Order dated 28.04.1989 found that the Society
was a registered resource society having majority of its members
as agriculturists and that the Society was sub-classified as service
resource society. After receipt of the decision of the Trial Court
on the four additional issues, the learned Single Judge dismissed
the appeal and confirmed the decree of possession. Against this,
defendant no.2 filed LPA No.1/1990, which was allowed by a Division
Bench and the matter was remanded to the learned Single Judge
for fresh reconsideration on all issues. Pursuant thereto, the learned
Single Judge reconsidered the evidence and allowed the first appeal
thereby setting aside the decree of possession and dismissing
[2025] 7 S.C.R. 313

Machhindranath S/o Kundlik Tarade Deceased Through LRs. v.
Ramchandra Gangadhar Dhamne & Ors.

the suit brought by the plaintiff. Aggrieved by these findings, the
original plaintiff (predecessor-in-interest of the appellants) filed LPA
No.33/1998 before the Division Bench, dismissal whereof has been
occasioned vide the Impugned Order.

SUBMISSIONS BY THE APPELLANTS:
9. Learned counsel for the appellants submitted that the mandate of
Section 47(2) of the Act very specifically creates an embargo on
transfer of land in any manner without previous sanction/permission
of the Society and as per Section 47(3) of the Act, transfer made in
contravention of sub-section (2) is void. Further, the charge of Society
was recorded in accordance with Section 48(a) and Section 48(d) of
the Act again creates an embargo from alienating the whole or any
part of the land specified in the declaration submitted while creating
charge under Section 48(a) and further, Section 48(e) declares such
alienations in contravention of Section 48(d) as void. Admittedly, the
Sale Deed executed on 15.07.1972 by original defendant no.1 in
favour of defendant no.2, is without any such sanction and therefore
void in terms of Sections 47(3) and 48(e) of the Act. It was canvassed
that the subsequent removal of charge by the Resolution dated
27.08.1973 is inconsequential.
10. It was pointed out that defendant no.1 had not contested the suit.
It was only the subsequent purchaser/defendant no.2 who did so.
Admittedly, defendant no.2 had no presence at the time of the
execution of the Registered Sale Deed dated 02.11.1971 or the
reconveyance deed of even date executed between the plaintiff
and defendant no.1. Therefore, defendant no.2 cannot falsify the
Sale Deed dated 02.11.1971 and his case had to be limited to that
of a bonafide purchaser for value without notice. The Trial Court
specifically observed, on perusal of substantial evidence, that the
plaintiff had proved the true nature of the transaction executed on
02.11.1971 and that defendant no.2 was not a bonafide purchaser
on account of the series of admissions extracted from him during
cross-examination.
11. The learned Single Judge, on remand, had set aside the decree by
interpreting Sections 47 and 48 of the Act. The evidence of Narsing
Sonar (Assistant Registrar, Co-Operative Societies at Rahuri),
Karbhari Shete (Chief Secretary of the Society) and Ram Krishna
314 [2025] 7 S.C.R.

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Hapse (Secretary of the Society) has been accepted which proves
existence of charge on the date when the Sale Deed dated 15.07.1972
was executed inter-se the defendants. Although the learned Single
Judge observed that the cooperative societies mentioned in Section
48 of the Act must be protected against defaults in the matter of
recoveries, however, significance is given to the release of charge
dated 27.08.1973 and it was held that such release would impliedly
restore status quo ante, which is legally impermissible.
12. It was submitted that the specific finding of the Trial Court recorded
in order dated 27.03.1980 at Paragraph 15 pertaining to defendant
no.2 not being bonafide purchaser for value without notice, has not
been disturbed. This finding had remained unchallenged for absence
of any ground in the appeal. Further, findings about the validity of
the Sale Deed dated 02.11.1971 had attained finality as they had
not been challenged by defendant no.1. The Impugned Order, it
was submitted, committed an error in concurring with the learned
Single Judge to hold that since the suit land was released from the
charge of the Society on 27.08.1973, the same would validate the
Sale Deed dated 15.07.1972. It was vehemently argued that the
patent error committed by the Impugned Order is in not considering
that the prior permissions contemplated under Sections 47 and 48 of
the Act were required on the date of the Sale Deed i.e. 15.07.1972
and subsequent release of charge would not have any retrospective
effect as such post-facto approval is not contemplated in the Act,
and thus, is inconsequential.
13. With regard to the Sale Deed dated 02.11.1971, it was submitted
that same will have to be appreciated based on the surrounding
circumstances which would include not only the Reconveyance Deed
dated 02.11.1971 but also the act of creating charge by Mutation
Entry no.3520 on 24.12.1971, which was in teeth of the declaration
submitted by plaintiff in terms of Section 48(a) of the Act and the
evidence of the office-bearers of the Society. More so for on that
date under Mutation Entry No. 3346 dated 09.09.1969, the name
of the Society was already mutated with regard to the suit land, but
the said Society was neither noticed nor its consent was taken. On
consideration of the aforesaid facts, it will be crystalized that the true
nature of the Sale Deed dated 02.11.1971 is that of a conditional
sale. Reliance was placed on Paragraphs 13, 14 & 21-24 of the
decision in C S Venkatesh v A S C Murthy, (2020) 3 SCC 280.
[2025] 7 S.C.R. 315

Machhindranath S/o Kundlik Tarade Deceased Through LRs. v.
Ramchandra Gangadhar Dhamne & Ors.

14. Lastly, it was submitted that concurrent finding of fact has never
been an embargo against the power of judicial review in the nature
of Article 136 of the Constitution of India, which in fact invokes the
concept of extraordinary civil appellate jurisdiction and the same has
been appreciated and reiterated by this Court from time to time and
recently in State of Rajasthan v Shiv Dayal, (2019) 8 SCC 637
wherein it was held that concurrent findings can always be interfered
with, when it is pointed out that the finding of fact in question is
de hors the pleadings and a misinterpretation of the material on
record. On these grounds, learned counsel prayed that the appeal
be allowed and for restoration of the Judgment and Order passed
by the Trial Court.

SUBMISSIONS BY RESPONDENTS NO.3 AND 4:
15. Learned counsel for the respondents no.3 and 4 submitted that
the Impugned Order rightly considered provisions of the law and
dismissed the plaintiff’s suit. The plaintiff failed to prove that the sale
transaction between himself and defendant no.1 was a contract or
reconveyance or loan transaction. Further, the plaintiff was conscious
and aware about the charge of the Society and having still entered
into the Sale Deed dated 02.11.1971 with defendant no.1, cannot be
allowed to take the benefit of his own wrong and claim that the sale
is void ab initio in terms of Sections 47 and 48 of the Act.
16. It was submitted that the plaintiff had not placed on record any
evidence to show that the market value of the suit land was higher
than Rs.5,000/- (Rupees Five Thousand) in the year 1971. Therefore,
the contention of the plaintiff that the suit land was sold for inadequate
consideration is unacceptable. Further, the defendants proved the
execution of the Sale Deed dated 15.07.1972 by defendant no.1 in
favour of defendant no.2 after receipt of consideration of Rs.30,000/-
(Rupees Thirty Thousand). Moreover, the Sale Deed dated 15.07.1972
is a registered document and the endorsement of the Sub-Registrar
shows his presence and that consideration of Rs.30,000/- (Rupees
Thirty Thousand) was duly received. Hence, validity of the Sale Deed
dated 15.07.1972 has been proved.
17. It was submitted that there are concurrent findings in favour of
the defendants and there is no perversity in the Impugned Order
warranting interference by this Court. On these grounds, learned
counsel prayed for dismissal of the appeal.
316 [2025] 7 S.C.R.

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ANALYSIS, REASONING AND CONCLUSION:
18. Having heard learned counsel for the parties and going through the
record, including written submissions as filed by the parties concerned,
we find that there are multiple factors requiring consideration. The
main issue is as to whether the conveyance of the suit land by
the original plaintiff dated 02.11.1971 in favour of defendant no.1
could have been done and, the same having been done, could be
sustained in law.
19. On the aforesaid point, there is no dispute with regard to the
application of Section 48 of the Act which provides that when on
any immovable property a charge has been created in favour of any
society by any member by way of a declaration in pursuance of a
loan, then there is an embargo on alienating such property during
the subsistence of the charge. In this regard, sub-sections (c), (d)
and (e) of Section 48 of the Act are relevant. The concerned Section
is extracted hereunder:
‘48. Charge on immovable property of members,
borrowing from certain societies.—Notwithstanding
anything contained in this Act or in any other law for the
time being in force—
(a) any person who makes an application to a society of
which he is a member, for a loan shall, if he owns any land
or has interest in any land as a tenant, make a declaration
in the form prescribed. Such declaration shall state that the
applicant thereby, creates, charge on such land or interest
specified in the declaration for the payment of the amount
of the loan which the society may make to the member in
pursuance of the application and for all future advances
(if any), required by him which the society may make to
him as such member, subject to such maximum as may
be determined by the society, together with interest on
such amount of the loan and advances;
(b) any person who has taken a loan from a society of
which he is a member, before the date of the coming into
force of this Act, and who owns any land or has interest
in land as a tenant, and who has not already made such
[2025] 7 S.C.R. 317

Machhindranath S/o Kundlik Tarade Deceased Through LRs. v.
Ramchandra Gangadhar Dhamne & Ors.

a declaration before the aforesaid date shall, as soon as
possible thereafter, make a declaration in the form and
to the effect referred to in clause (a); and no such person
shall, unless and until he has made such declaration, be
entitled to exercise any right, as a member of the society;
(c) a declaration made under clause (a) or (b) may be
varied at any time by a member, with the consent of the
society in favor of which such charge is created;
(d) no member shall alienate the whole or any part of the
land or interest therein, specified in the declaration made
under clause (a) or (b) until the whole amount borrowed by
the member together with interest thereon, is repaid in full:
Provided that, it shall be lawful to a member to execute a
mortgage / bond in respect of such land or any part thereof
in favour of an Agriculture and Rural Development Bank or
of the State Government under the Bombay Canal Rules
made under the Bombay Irrigation Act, 1879 or under any
corresponding law for the time being in force for the supply
of water from a canal to such land, or to any part thereof:
Provided further that, if a part of the amount borrowed by a
member is paid the society with the approval of the Central
Bank to which it may be indebted may, on an application
from the member, release from the charge created under
the declaration made under clause (a) or (b), such part
of the movable or immovable property specified in the
said declaration, as it may deem proper, with due regard
to the security of the balance of the amount remaining
outstanding from the member;
(e) any alienation made in contravention of the provisions
of clause (d) shall be void;
(f) subject to all claims of the Government in respect of
land revenue or any money recoverable as land revenue,
and all claims of the Agriculture and Rural Development
Bank in respect of its dues, in either case whether prior
in time or subsequent, and to the charge (if any) created
under an award made under the Bombay Agricultural
Debtors Relief Act, 1947 or any corresponding law for the
318 [2025] 7 S.C.R.

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time being in force in any part of the State, there shall
be a first charge in favour of the society on the land or
interest specified in the declaration made under clause
(a) or (b), for and to the extent of the dues owing by the
member on account of the loan;
(g) and in particular, notwithstanding anything contained
in Chapter X of the Maharashtra Land Revenue Code,
1966, the Record of Rights maintained there under shall
also include the particulars of every charge on land or
interest created under a declaration under clause (a) or
(b), and also the particulars of extinction of such charge.
Explanation - For the purposes of this section the
expression “society” means; (i) any resource society, the
majority of the members of which are agriculturists and the
primary object of which is to obtain credit for its members,
or (ii) Any society, or any society of the class of societies,
specified in this behalf by him State Government, by a
general or special order.’
20. From a reading of the aforesaid provision, there is no ambiguity with
regard to the import of the Section. Alienation of any such property
on which a charge is created in favour of the concerned cooperative
society by way of declaration is totally beyond the capacity of the
owner/member who has declared it as a charged property, until the
amount, for which the charge was created along with the interest,
is repaid in full. However, even if a part of the amount due is paid
then a society may, on an application moved by the member, release
from charge such part of the property, as it may deem proper having
regard to the outstanding amount.
21. In the present case, there is no denial to the fact that the charge on
the suit land as declared by the plaintiff was prior to the date of him
executing the Sale Deed dated 02.11.1971 in favour of defendant
no.1. It is also not in dispute that neither the amount for which the
charge was created was repaid to the Society either in full or in part
nor any such application for part-release was either filed before or
accepted by the Society prior to the said sale. Thus, at first glance,
it appears to be an open-and-shut case that the said Sale Deed
dated 02.11.1971 was void as per Section 48(e) of the Act. Further,
[2025] 7 S.C.R. 319

Machhindranath S/o Kundlik Tarade Deceased Through LRs. v.
Ramchandra Gangadhar Dhamne & Ors.

the subsequent Sale Deed dated 15.07.1972 by respondent no.1/
original defendant no.1 in favour of defendant no.2 on this analogy
would also have to be held to be void. However, we hasten to add
that a deeper probe is required as to what extent the theory of the
sale being void ab initio had to be applied has not been spelt out by
the statute and, thus is required to be gone into depending upon the
specific and relevant facts and circumstances of each case as also
the ancillary background. Therefore, for the time being, the Court
would move to the other issue and thereafter take a final view having
regard to the overall picture which emerges, for the final disposal
of the instant case.
22. Coming to the other issue which is as to whether the subsequent
release of the charge created on the suit land by the Society upon
receiving the entire dues having been paid by the plaintiff, would
give retrospectivity to the said release so as to validate and ratify
the Sale Deeds dated 02.11.1971 and 15.07.1972? Under Section
48(d) of the Act, a society has the power to release from charge any
part of the land specified in the declaration. Further, Section 48(c)
of the Act relates only to variation of the declaration, but by obvious
and necessary implication, it would include conclusion/release of
the charge itself, in case the entire dues of a society are satisfied
by the member who made the declaration. In the present case, the
Society had itself resolved to release the charge on the suit land on
27.08.1973. For all practical purposes, the interest of the Society
has not suffered.
23. The emphasis of the plaintiff before this Court is that the Trial Court
as well as the learned Single Judge had, in the first round of litigation,
held in his favour and both the Sale Deeds dated 02.11.1971 and
15.07.1972 were declared void and the suit seeking reconveyance
was decreed. This raises another question which needs to be
answered i.e., against whom or between whom, if at all, any alienation
under Section 48(e) of the Act is applicable for the said acts resulting
in the same being void?
24. In this regard, the conduct of the member/person who has under
a declaration created a charge upon property in lieu of any loan
obtained from a society would be important. Section 48(e) of the
Act declares void any transaction by a member-loanee against the
society, where he/she alienates such immovable property on which
320 [2025] 7 S.C.R.

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a charge is created under declaration. Thus, the primal purpose is
to safeguard the interest of the society which advanced the loan. As
a corollary, the right to sue or get a declaration qua any alienation
made by a loanee rests and is available only to the society in favour
of whom the property under a declaration was charged. It would,
therefore, not be within the domain of the member-loanee who
himself commits a breach to take a stand that the act done by him
should be declared void, without the society coming forward before
an appropriate forum to set aside such alienation. The law cannot,
and does not, reward a person for his/her own wrongs. In Sindav
Hari Ranchhod v Jadev Lalji Jaymal, (1997) 7 SCC 95, Section
49 of the Gujarat Cooperative Societies Act, 1961, a provision in
pari materia to Section 48 of the Act, was involved, and the Court
observed:
‘8. In our view, this submission on behalf of the learned
counsel for the respondents cannot be sustained. It is
true that no relief was claimed by the plaintiffs against
the Society but the grievance made by the plaintiffs in
substance was of course on behalf of the Society and
whether such Society was covered by Section 49 or not
and whether such Society had waived its statutory right
or not in favour of Original Defendant 1 were all questions
which could have been thrashed out only in the presence
of the Society which conspicuously was not joined as at
least a proper party. It is also pertinent to note that the
Society has not challenged these sale deeds executed by
Defendant 1 at any time. The plaintiffs also failed to lead
evidence for showing how Section 49(1) got attracted on
the facts of the present case, despite having full opportunity
before the trial court to prove their case on this issue. They
could not be given a second innings just for the asking as
is done in the impugned order. Consequently the plaintiffs
could not legitimately and effectively challenge the sale
transactions entered into by their father in favour of the
alienees namely Defendants 15 and 10 on the ground of
violation of Section 49(1) of the Act. In our view on the
facts of the present case, therefore, there was no occasion
for the High Court for ordering any remand as on the
main issue the plaintiffs had failed, hence the suit ought
[2025] 7 S.C.R. 321

Machhindranath S/o Kundlik Tarade Deceased Through LRs. v.
Ramchandra Gangadhar Dhamne & Ors.

to have been dismissed against all the defendants instead
of only against some of them as ruled by the High Court.
Consequently, this appeal is required to be allowed and
the plaintiffs’ suit against appellant — Defendant 15 also
is liable to be dismissed as on merits the plaintiffs had
failed to effectively challenge the sale transactions entered
into by their father in favour of Defendant 15.’
(emphasis supplied)

25. In the present case, it is also not in dispute that the Society, in whose
favour the charge was created on the land in question, never moved
before any forum for enforcing its charge over the suit land or raised
any grievance with regard to either of the Sale Deeds. Thus, the
situation which emerges is that Section 48(e) of the Act which says
that any alienation made in contravention of the provisions of clause
(d) shall be void has to be read as directory to the extent that the
same can be acted upon only at the instance of the party aggrieved
(viz. the society concerned) upon whom the right has been created
under the statute. In other words, with regard to a transaction, unless
the society comes forward to seek its nullification/setting aside, the
same would at best be a voidable action and not void ab initio. The
distinction between ‘void’ and ‘voidable’ was considered by the Court
in Dhurandhar Prasad Singh v Jai Prakash University, (2001) 6
SCC 534:
‘16. The expressions “void and voidable” have been the
subject-matter of consideration before English courts times
without number. In the case of Durayappah v. Fernando
[(1967) 2 All ER 152: (1967) 2 AC 337: (1967) 3 WLR 289
(PC)] the dissolution of the Municipal Council by the Minister
was challenged. Question had arisen before the Privy
Council as to whether a third party could challenge such
a decision. It was held that if the decision was a complete
nullity, it could be challenged by anyone, anywhere. The
court observed at p. 158 E-F thus:
“The answer must depend essentially on
whether the order of the Minister was a complete
nullity or whether it was an order voidable only
at the election of the Council. If the former, it
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must follow that the Council is still in office and
that, if any councillor, ratepayer or other person
having a legitimate interest in the conduct of the
Council likes to take the point, they are entitled
to ask the court to declare that the Council is
still the duly elected Council with all the powers
and duties conferred on it by the Municipal
Ordinance.”
17. In the case of McC (A minor), In re [(1985) 1 AC 528 :
(1984) 3 All ER 908: (1984) 3 WLR 1227 (HL)] the House of
Lords followed the dictum of Lord Coke in Marshalsea case
[(1612) 10 Co Rep 68 b: 77 ER 1027] quoting a passage
from the said judgment which was rendered in 1613 where
it was laid down that where the whole proceeding is coram
non judice which means void ab initio, the action will lie
without any regard to the precept or process. The Court
laid down at AC p. 536 thus: (All ER pp. 912h-i, 913a-b)
“Consider two extremes of a very wide spectrum.
Jurisdiction meant one thing to Lord Coke in
1613 when he said in Marshalsea case [(1612)
10 Co Rep 68 b: 77 ER 1027] Co Rep, at p. 76a:
‘… when a court has jurisdiction of the
cause, and proceeds inverso ordine
or erroneously, there the party who
sues, or the officer or Minister of the
court who executes the precept or
process of the court, no action lies
against them. But when the court has
not jurisdiction of the cause, there
the whole proceeding is coram non
judice, and actions will lie against
them without any regard of the
precept or process….’
The Court of the Marshalsea in that case acted
without jurisdiction because, its jurisdiction being
limited to members of the King’s household,
it entertained a suit between two citizens
neither of whom was a member of the King’s
[2025] 7 S.C.R. 323

Machhindranath S/o Kundlik Tarade Deceased Through LRs. v.
Ramchandra Gangadhar Dhamne & Ors.

household. Arising out of those proceedings a
party arrested ‘by process of the Marshalsea’
could maintain an action for false imprisonment
against, inter alios, ‘the Marshal who directed
the execution of the process’. This is but an
early and perhaps the most-quoted example of
the application of a principle illustrated by many
later cases where the question whether a court
or other tribunal of limited jurisdiction has acted
without jurisdiction (coram non judice) can be
determined by considering whether at the outset
of the proceedings that court had jurisdiction
to entertain the proceedings at all. So much is
implicit in the Lord Coke’s phrase ‘jurisdiction
of the cause’.”
18. In another decision, in the case of Director of Public
Prosecutions v. Head [1959 AC 83: (1958) 1 All ER
679: (1958) 2 WLR 617 (HL)] the House of Lords was
considering the validity of an order passed by the Secretary
of State in appeal preferred against judgment of acquittal
passed in a criminal case. The Court of Criminal Appeal
quashed the conviction on the ground that the aforesaid
order of the Secretary was null and void and while upholding
the decision of the Court of Criminal Appeal, the House
of Lords observed at AC p. 111 thus: (All ER p. 692g-i)
“This contention seems to me to raise the whole
question of void or voidable; for if the original
order was void, it would in law be a nullity. There
would be no need for an order to quash it. It
would be automatically null and void without
more ado. The continuation orders would be
nullities too, because you cannot continue a
nullity. The licence to Miss Henderson would
be a nullity. So would all the dealings with her
property under Section 64 of the Act of 1913
[ Mental Deficiency Act]. None of the orders
would be admissible in evidence. The Secretary
of State would, I fancy, be liable in damages
for all of the ten years during which she was
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unlawfully detained, since it could all be said to
flow from his negligent act; see Section 16 of
the Mental Treatment Act, 1930.
But if the original order was only voidable, then
it would not be automatically void. Something
would have to be done to avoid it. There would
have to be an application to the High Court for
certiorari to quash it.”
19. This question was examined by the Court of Appeal
in the case of R. v. Paddington Valuation Officer, ex p
Peachey Property Corpn. Ltd. [(1965) 2 All ER 836: (1966)
1 QB 380: (1965) 3 WLR 426 (CA)] where the valuation
list was challenged on the ground that the same was void
altogether. On these facts, Lord Denning, M.R. laid down
the law, observing at p. 841 thus:
“It is necessary to distinguish between two kinds
of invalidity. The one kind is where the invalidity
is so grave that the list is a nullity altogether.
In which case there is no need for an order
to quash it. It is automatically null and void
without more ado. The other kind is when the
invalidity does not make the list void altogether,
but only voidable. In that case it stands unless
and until it is set aside. In the present case the
valuation list is not, and never has been, a nullity.
At most the first respondent — acting within
his jurisdiction — exercised that jurisdiction
erroneously. That makes the list voidable and
not void. It remains good until it is set aside.”
20. de Smith, Woolf and Jowell in their treatise Judicial
Review of Administrative Action, 5th Edn., para 5-044, have
summarised the concept of void and voidable as follows:
“Behind the simple dichotomy of void and
voidable acts (invalid and valid until declared
to be invalid) lurk terminological and conceptual
problems of excruciating complexity. The
problems arose from the premise that if an act,
order or decision is ultra vires in the sense of
[2025] 7 S.C.R. 325

Machhindranath S/o Kundlik Tarade Deceased Through LRs. v.
Ramchandra Gangadhar Dhamne & Ors.

outside jurisdiction, it was said to be invalid, or
null and void. If it is intra vires it was, of course,
valid. If it is flawed by an error perpetrated within
the area of authority or jurisdiction, it was usually
said to be voidable; that is, valid till set aside on
appeal or in the past quashed by certiorari for
error of law on the face of the record.”
21. Clive Lewis in his work Judicial Remedies in Public
Law at p. 131 has explained the expressions “void and
voidable” as follows:
“A challenge to the validity of an act may be by
direct action or by way of collateral or indirect
challenge. A direct action is one where the
principal purpose of the action is to establish
the invalidity. This will usually be by way of
an application for judicial review or by use of
any statutory mechanism for appeal or review.
Collateral challenges arise when the invalidity is
raised in the course of some other proceedings,
the purpose of which is not to establish invalidity
but where questions of validity become relevant.”
22. Thus the expressions “void and voidable” have been
the subject-matter of consideration on innumerable
occasions by courts. The expression “void” has several
facets. One type of void acts, transactions, decrees are
those which are wholly without jurisdiction, ab initio void
and for avoiding the same no declaration is necessary,
law does not take any notice of the same and it can be
disregarded in collateral proceeding or otherwise. The
other type of void act, e.g., may be transaction against a
minor without being represented by a next friend. Such a
transaction is a good transaction against the whole world.
So far as the minor is concerned, if he decides to avoid
the same and succeeds in avoiding it by taking recourse
to appropriate proceeding the transaction becomes void
from the very beginning. Another type of void act may
be which is not a nullity but for avoiding the same a
declaration has to be made. Voidable act is that which
is a good act unless avoided, e.g., if a suit is filed for a
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declaration that a document is fraudulent and/or forged and
fabricated, it is voidable as the apparent state of affairs is
the real state of affairs and a party who alleges otherwise
is obliged to prove it. If it is proved that the document is
forged and fabricated and a declaration to that effect is
given, a transaction becomes void from the very beginning.
There may be a voidable transaction which is required to
be set aside and the same is avoided from the day it is
so set aside and not any day prior to it. In cases where
legal effect of a document cannot be taken away without
setting aside the same, it cannot be treated to be void but
would be obviously voidable.’
(emphasis supplied)

26. Another aspect of importance is the fact that ultimately, the dues of
the Society have been cleared, may be by the plaintiff himself, but
the result is that the same has also been followed up by acceptance
and release by the Society i.e., the suit land stood released from
charge on and with effect from 27.08.1973.
27. Another factual aspect raised by the appellants is that the suit
land is highly undervalued as the consideration is only Rs.5,000/-
(Rupees Five Thousand) though the same ought to have been
Rs.25,000/- (Rupees Twenty-Five Thousand). This contention
cannot be given much importance considering the relationship
between the parties i.e., the defendant no.1 being the son-in-law
and nephew of the plaintiff. Further, no material to buttress/support
the claim of the valuation being Rs.25,000/- (Rupees Twenty-Five
Thousand) was ever produced before any of the Courts below.
Thus, a bald statement on a purely factual aspect has rightly not
been accepted by the Courts. We too do not propose to chart a
different course on this.
28. Before, however, forming a final view, this Court is also required
to consider the plea of the appellants that on 02.11.1971, after
execution of the Sale Deed by the plaintiff in favour of respondent
no.1/ defendant no.1, immediately a reconveyance deed under
the name and style of ‘Ram Ram Patra’ was also executed, which
stipulated that upon Rs.5,000/- (Rupees Five Thousand) being repaid
by the plaintiff to the respondent no.1/ defendant no.1, he would
re-convey the land to the plaintiff. This document would not be of
[2025] 7 S.C.R. 327

Machhindranath S/o Kundlik Tarade Deceased Through LRs. v.
Ramchandra Gangadhar Dhamne & Ors.

any help to the appellants mainly because cognizance of the same
cannot be taken in view of the document not being executed either
on stamp paper or registered and, additionally, being in the writing
of a different scribe vis-a-vis the registered Sale Deed of even date.
Moreover, the plaintiff while executing the registered Sale Deed on
02.11.1971 in favour of defendant no.1 has clearly stated that the
suit land was free of any encumbrance(s), which, in our opinion,
negates the argument urged that the sale was a conditional sale
and not a full-fledged sale.
29. Though neither discussed in any of the Orders nor argued by any
party, a serious doubt arises in the mind of the Court inasmuch as
it cannot be believed that a valid reconveyance deed would not
specify any time-period and also not provide for any escalation in
the amount to be returned in lieu of reconveyance i.e., to say that
for an indefinite period the land would remain with defendant no.1,
but whenever the plaintiff wants, he can ask for its reconveyance by
paying merely Rs.5,000/- (Rupees Five Thousand). Besides being
iniquitous, this also demonstrates that such term could not have been
incorporated, if at all there was a genuine reconveyance deed. Had
it really been agreed between the parties that the suit land was to
be reconveyed upon the money being returned, the money to be
returned would be commensurate with escalation for the period for
which it was not returned by providing for some increase, either
quantified or by prescribing a rate of interest and most importantly
an outward time-limit. These are conspicuous by their absence in
the Reconveyance Deed.
30. It is also noteworthy that the plaintiff has nowhere stated that he
ever approached defendant no.1 for re-conveying the suit land. The
only stand taken was that he was ready to return Rs.5,000/- (Rupees
Five Thousand) and that the Court may pass a decree directing
reconveyance for the sum of Rs.5,000/- (Rupees Five Thousand).
This itself dilutes the claim inasmuch as the cause of action would
arise when the plaintiff asserted that he was ready, willing and
offered to pay the amount to defendant no.1, who refused to accept
such payment of Rs.5,000/- (Rupees Five Thousand). Absent such
averment, no relief can enure to the plaintiff.
31. Apropos the rights of the parties inter-se, the Court would only observe
that defendant no.2 was a bonafide purchaser from respondent
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no.1/defendant no.1, on the date the Sale Deed was executed on
15.07.1972, for the reason that such transaction was made on the
basis of the title which was apparent from the Sale Deed dated
02.11.1971 in favour of respondent no.1/defendant no.1. This would
not have given any occasion to defendant no.2 to be cautious or
under any impression, much less knowledge, that the property bought
by him was encumbered on the date of purchase.
32. Undoubtedly, the present case comes under a unique category
where a person on the one hand comes before a Court seeking
that his own actions be nullified on the ground that it was void and
on the other hand wants relief in his favour, which is consequential
to and traceable to his own wrong. It would not be proper for a
Court of law to assist or aid such person who states that the wrong
he committed be set aside and a relief be granted de hors the
wrong committed, after condoning the same. In the present case,
the plaintiff cannot be allowed to benefit from his own wrong and
the Court will not be a party to a perpetuation of illegality. In Ram
Pyare v Ram Narain, (1985) 2 SCC 162, a 3-Judge Bench of this
Court, in the circumstances therein, did not void a transaction
even though the transaction was void being prohibited by law.
The principle that no party can take advantage of his/her own
wrong i.e. ex injuria sua nemo habere debet is squarely attracted.
In Kusheshwar Prasad Singh v State of Bihar, (2007) 11 SCC
447, it was held:
‘13. The appellant is also right in contending before this
Court that the power under Section 32-B of the Act to
initiate fresh proceedings could not have been exercised.
Admittedly, Section 32-B came on the statute book by Bihar
Act 55 of 1982. The case of the appellant was over much
prior to the amendment of the Act and insertion of Section
32-B. The appellant, therefore, is right in contending that
the authorities cannot be allowed to take undue advantage
of their own default in failure to act in accordance with law
and initiate fresh proceedings.
14. In this connection, our attention has been invited by
the learned counsel for the appellant to a decision of this
Court in Mrutunjay Pani v. Narmada Bala Sasmal [AIR
1961 SC 1353] wherein it was held by this Court that
[2025] 7 S.C.R. 329

Machhindranath S/o Kundlik Tarade Deceased Through LRs. v.
Ramchandra Gangadhar Dhamne & Ors.

where an obligation is cast on a party and he commits a
breach of such obligation, he cannot be permitted to take
advantage of such situation. This is based on the Latin
maxim commodum ex injuria sua nemo habere debet (no
party can take undue advantage of his own wrong).
15. In Union of India v. Major General Madan Lal Yadav
[(1996) 4 SCC 127: 1996 SCC (Cri) 592] the accused
army personnel himself was responsible for delay as he
escaped from detention. Then he raised an objection
against initiation of proceedings on the ground that such
proceedings ought to have been initiated within six months
under the Army Act, 1950. Referring to the above maxim,
this Court held that the accused could not take undue
advantage of his own wrong. Considering the relevant
provisions of the Act, the Court held that presence of the
accused was an essential condition for the commencement
of trial and when the accused did not make himself
available, he could not be allowed to raise a contention
that proceedings were time-barred. This Court (at SCC
p. 142, para 28) referred to Broom’s Legal Maxims (10th
Edn.), p. 191 wherein it was stated:
“It is a maxim of law, recognised and established,
that no man shall take advantage of his own
wrong; and this maxim, which is based on
elementary principles, is fully recognised in
courts of law and of equity, and, indeed, admits of
illustration from every branch of legal procedure.”
16. It is settled principle of law that a man cannot be
permitted to take undue and unfair advantage of his own
wrong to gain favourable interpretation of law. It is sound
principle that he who prevents a thing from being done
shall not avail himself of the non-performance he has
occasioned. To put it differently, “a wrongdoer ought not
to be permitted to make a profit out of his own wrong”.’
(emphasis supplied)

33. On an overall circumspection, the learned Single Judge and the
Division Bench have not committed any error.
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34. In the light of the discussions made and reasons recorded hereinabove,
we do not find any merit in the present appeal. Accordingly, the appeal
stands dismissed.
35. No order as to costs. I.A. No.42744/2020 is closed.
36. Registry is directed to prepare Decree Sheet accordingly.

Result of the case: Appeal dismissed.

†
Headnotes prepared by: Divya Pandey