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Erandol Taluka Gramodyog, Utpadak Sahakari Society, Erandol Vs. Sunil Waste Corporation - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtMumbai High Court
Decided On
Case NumberA.F.A.D. No. 955 of 1967
Judge
Reported inAIR1971Bom91; (1970)72BOMLR620; (1970)6CompLJ212(Bom); 1970MhLJ923
ActsCode of Civil Procedure (CPC), 1908 - Sections 38 and 47; Maharashtra Co-operative Societies Act, 1960 - Sections 164; Limitation Act - Sections 3; Indian Partnership Act, 1932 - Sections 69(1) and 69(2); Bombay Co-operative Societies Act, 1925 - Sections 70
AppellantErandol Taluka Gramodyog, Utpadak Sahakari Society, Erandol
RespondentSunil Waste Corporation
Advocates:A.P. Vaze, Adv. for ;V.D. Malpani, Adv.
Excerpt:
.....a nullity. the appellant having failed to do so, the decree is binding between the parties, and this point cannot be agitated in execution proceedings. 1925, which is in terms similar to section 164 of the present maharashtra co-operative societies act, 1960, was mandatory and the consequence of the plaintiff's failure to give notice under it was as if his action had never been brought......co-operative societies act, 1960, and that for this reason, the suit was not maintainable and the decree passed by the subordinate judge was a nullity. this contention was negatived by the learned civil judge. against this order the appellant filed an appeal under section 47 of the code of civil procedure, 1908, to the district court, jalgaon. the appeal was disposed of by the learned assistant judge at jalgaon. he held that this was not a question which affected the jurisdiction of the court to pass the decree and it could not be gone into by the executing court. the learned assistant judge, however, further observed:--'this question cannot be gone into by the executing court, and it must execute the decree as it stands, of course, subject to the objection about the jurisdiction.'he.....
Judgment:

1. This second appeal arises out of execution proceedings adopted by the Respondent against the Appellant. The Respondent filed a suit in the Court of the Subordinate Judge, Delhi, against the Appellant and obtained a money decree in the sum of Rupees 1400 in respect of the amount claimed in the suit and a sum of Rs. 277.99 P. for costs. The decree was passed ex parte. After obtaining the decree the Respondent got it transferred to the Court of the Civil Judge, Junior Division, Erandol, and filed an execution application, being Regular Darkhast No. 14 of 1964, in the transferee Court. The Appellant filed objections thereto. The principal contention of the Appellant was that the Appellant Is a registeredco-operative society and the suit was instituted without giving to the Registrar of Co-operative Societies the requisite notice under Section 164 of the Maharashtra Co-operative Societies Act, 1960, and that for this reason, the suit was not maintainable and the decree passed by the subordinate Judge was a nullity. This contention was negatived by the learned Civil Judge. Against this order the Appellant filed an appeal under Section 47 of the Code of Civil Procedure, 1908, to the District Court, Jalgaon. The appeal was disposed of by the learned Assistant Judge at Jalgaon. He held that this was not a question which affected the jurisdiction of the Court to pass the decree and it could not be gone into by the executing Court. The learned Assistant Judge, however, further observed:--

'this question cannot be gone into by the executing Court, and it must execute the decree as it stands, of course, subject to the objection about the jurisdiction.'

He accordingly dismissed the appeal with costs. Against this order the Appellant has filed the present second appeal.

2. The only ground urged in this appeal is that as the Respondent instituted the suit without giving a notice as required by Section 164 of the Maharashtra Co-operative Societies Act, 1960, the trial Court had no jurisdiction to entertain the suit or to pass a decree therein and accordingly the decree sought to be executed was a nullity and incapable of execution.

2-A. Section 164 of the Maharashtra Co-operative Societies Act provides as follows:--

'Notice necessary in suits.

No suit shall be instituted against a society, or any of its officers, in respect of any act touching the business of the society, until the expiration of two months next after notice in writing has been delivered to the Registrar or left at his office, stating the cause of action, the name, description and place of residence of the plaintiff and the relief which he claims, and the plaint shall contain a statement that such notice has been so delivered or left.'

The section has limited operation and does not apply to all suits filed against a registered co-operative society but only to suits in respect of any act touching the business of the society. Assuming for the purposes of the present appeal, that the suit filed by the Respondent was a suit touching thebusiness of the society, the question still remains whether the executing Court was entitled to go behind the decree. In Eana Harkishandas Lallubhai v. Rana Gulabdas Kalyandas : AIR1956Bom513 , it was held that in determining the jurisdiction of the executing Court to entertain pleas under Section 38 of the Code of Civil Procedure, 1908, it is always necessary to make a distinction between pleas that tend to show that the decree in question is a nullity and pleas that merely challenge the validity or the propriety of the decree on the ground that it is contrary to the provisions of law. If the plea is that the decree is a nullity and so cannot be executed, it would be open to the executing Court to entertain the plea. On the other hand, if the plea is that the decree is contrary to law in the sense that in passing the said decree certain provisions of the law have been Ignored or contravened, that would not necessarily make the decree a nullity and allegations about the impropriety or the illegality of the decree cannot be entertained in execution proceedings. As pointed out by the Supreme Court in Seth Hiralal Patni v. Kali Nath : [1962]2SCR747 the validity of a decree can be challenged in execution proceedings only on the ground that the Court which passed the decree was lacking in inherent jurisdiction in the sense that it could not have seized of the case because the subject-matter was wholly foreign to its jurisdiction or that the defendant was dead at the time the suit had been instituted or decree passed, or some such other ground which could have the effect of rendering the Court entirely lacking in jurisdiction in respect of the subject-matter of the suit or over the parties to it.

3. Section 164 of the Maharashtra Co-operative Societies Act is mandatory in its terms just like Section 3 of the Limitation Act or Section 69(1) of the Indian Partnership Act, 1932. What Section 164 does is to require that the requisite notice should be given prior to the institution of the suit. If a suit is filed without giving such a notice, the suit is not maintainable. From this, however, it does not follow that non-compliance with the provisions of Section 164 is a defect which takes away the inherent jurisdiction of the Court to try the suit or pass the decree. In such a case the decree would be contrary to the provisions of law but would not be a decree passed by a Court without jurisdiction. This is a defect which affects the maintainability of the suit and not the inherent jurisdiction of the Court. A suit may not be maintainable for diverse reasons as, for example, because it isfiled beyond the prescribed period of limitation or because it is a suit by an unregistered partnership firm to enforce a right arising out of a contract or because notice under Section 164 of the Maharashtra Co-operative Societies Act has not been given prior to the institution of the suit. None of these questions affect the inherent jurisdiction of the Court. So far as the question of limitation is concerned, in Ittyavira Mathai v. Varkey Varkey, : [1964]1SCR495 , it was held that Section 3 of the Limitation Act is peremptory and it is the duty of the Court to take notice of this provision and give effect to it even though the point of limitation is not referred to in the pleadings, but even so, it cannot be said that where the Court fails to perform its duty, it acts without jurisdiction. If it fails to do its duty, it merely commits an error of law and an error of law can be corrected only in the manner laid down in the Code of Civil Procedure. If the party aggrieved does not take appropriate step by way of preferring an appeal to have that error corrected, the erroneous decree will hold good and will not be open to challenge on the basis of its being a nullity.

4. In Kuldip Thakur v. Sheomangal Prasad Thakur : AIR1957Pat4 , a suit was instituted by an unregistered firm and a decree was passed in its favour. When the decree was sought to be executed, the judgment-debtor objected on the ground that under Section 69(2) of the Indian Partnership Act a suit by an unregistered firm was not maintainable and, therefore, the decree passed in favour of such unregistered firm was a nullity. The Patna High Court held that:--

'the disability created by Sub-section (2) of Section 69 of the Act is with regard to the right to institute a suit, and not with regard to the power of the Court to pass a decree. The prohibition contained in Section 69(2) is only to the institution of the suit.

The plea of non-maintainability of a suit, on behalf of an unregistered firm under Section 69(2), Partnership Act, is, as such, not available to a judgment-debtor at the execution stage. Such an objection should be taken in the suit itself before the passing of the decree.

If such an objection is taken in the suit, and overruled, or, such an objection is not taken at all in the suit, and a decree is passed, in contravention of Section 69(2) of the Act, the decree is not a nullity, if the Court otherwise has inherent jurisdiction to pass the decree. The executing Court, therefore, has no jurisdiction to go behind such a decree.'

The bar to maintainability of the suitenacted in Section 69(2) of the Partnership Act is in language identical with that of Section 164 of the Maharashtra Co-operative Societies Act. The material provisions of Section 69(2) are:--

'No suit to enforce a right arisingfrom a contract shall be instituted in any Court by or on behalf of a firm againsta third party unless the firm is registered......'

5. The principles enunciated in the above decisions directly govern the present case. It is not the case here that the Subordinate Judge at Delhi had otherwise no inherent jurisdiction to try the suit or pass the decree. This was, therefore, a suit instituted in the Court which admittedly had jurisdiction to entertain and decide it. If the suit was entertained and a decree passed, though no notice under Section 164 of the Maharashtra Co-operative Societies Act was given prior to its institution, it was a decree passed contrary to the provision of law, namely, Section 164. It was open to the Appellant to challenge the decree on this ground in appeal. The appellant having failed to do so, the decree is binding between the parties, and this point cannot be agitated in execution proceedings.

6. Mr. Vaze, learned advocate for the Appellant, has strongly relied upon the decision of a Division Bench of this High Court in Dharwar Urban Co-op. Bank Ltd. v. Ramchandra Govindrao Alnavar : AIR1937Bom231 . In that case it was held that Section 70 of the old Bombay Cooperative Societies Act. 1925, which is in terms similar to Section 164 of the Present Maharashtra Co-operative Societies Act, 1960, was mandatory and the consequence of the plaintiff's failure to give notice under it was as if his action had never been brought. This authority is not relevant. In that case this contention was raised in the suit itself. The decision relied upon was given in the appeal from the original decree. This case is, therefore, not an authority for the proposition that this is a ground which entitles the executing Court to go behind the decree or that for the purpose of execution a decree passed in a suit instituted without giving the requisite notice under the Co-operative Societies Act is a nullity.

7. Before parting with the appeal I may point out the observation of the learned Assistant Judge that the executing Court 'must execute the decree as it stands, of course, subject to the objection about the jurisdiction' is incorrect and unjustified in law. As this is not an objection which it is open to the executing Court to entertain, the decree must be executed without reservation.

8. In the result, the appeal fails and is dismissed.

9. As the Respondent has not appeared, there will be no order as to costs of the appeal.

10. Appeal dismissed.


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