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The Dharwar Urban Co-operative Bank Ltd. Vs. Ramchandra Govindrao Alnavar - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtMumbai
Decided On
Case NumberCross First Appeal Nos. 109 and 110 of 1931
Judge
Reported inAIR1937Bom231; (1937)39BOMLR249
AppellantThe Dharwar Urban Co-operative Bank Ltd.; Ramchandra Govindrao Alnavar
RespondentRamchandra Govindrao Alnavar; the Dharwar Urban Co-operative Bank Ltd.
Excerpt:
bombay co-operative societies act (bom. vii of 1925), sections 54, 57 and 70-arbitration award by registrar's nominee-suit to set aside award-civil court not competent to go behind award- effect of want of notice under section 70.;the question whether there has been undue influence or fraud in any transaction involved in the reference to the registrar under the bombay co-operative societies act, 1925, is a question for the arbitrator to decide and is not a matter into which a civil court is competent to inquire.;bharmakka v. mallappa (1925) 28 bom. l.r. 598, and cooverjee plumber v. vasant &c. society (1934) 36 bom. l.r. 1245, referred to.;in enacting section 57 of the co-operative societies act, 1912, the legislature clearly intended that where an arbitrator has passed an award under.....sen, j.1. these are two appeals against the decree of the first class subordinate judge of dharwar in special suit no. 104 of 1929.2. the facts in this case are as follows : in 1899 there appears to have been a partition in the family of the plaintiffs wherein shitabai, the mother of govindrao, plaintiffs father, got gold ornaments weighing 166-10-0 tolas of gold as stridhan. later on as the plaintiffs' father govindrao made use of these ornaments in the course of his business, he sold to his mother shitabai the suit property and certain lands on february 26, 1916. this property was declared as belonging to shitabai in suit no. 639 of 1920. govindrao, however, had to apply in insolvency in 1916, his debts amounting to rs. 17,000 to rs. 18,000. in 1917 shitabai passed a will in favour of.....
Judgment:

Sen, J.

1. These are two appeals against the decree of the First Class Subordinate Judge of Dharwar in Special Suit No. 104 of 1929.

2. The facts in this case are as follows : In 1899 there appears to have been a partition in the family of the plaintiffs wherein Shitabai, the mother of Govindrao, plaintiffs father, got gold ornaments weighing 166-10-0 tolas of gold as stridhan. Later on as the plaintiffs' father Govindrao made use of these ornaments in the course of his business, he sold to his mother Shitabai the suit property and certain lands on February 26, 1916. This property was declared as belonging to Shitabai in suit No. 639 of 1920. Govindrao, however, had to apply in insolvency in 1916, his debts amounting to Rs. 17,000 to Rs. 18,000. In 1917 Shitabai passed a will in favour of her grandsons, the plaintiffs, to whom she bequeathed all her moveable and immovea'ble property. In the insolvency case Govindrao arrived at an understanding with his creditors, and on December 2, 1919, the Court sanctioned a composition scheme whereby the creditors were to receive three annas in a rupee. The defendant in the present suit, the Dharwar Urban Co-operative Credit Society, was one of the creditors, and Govindrao was to pay to this Society Rs. 242-4-0 out of a debt of Rs. 1,291-15-0.

3. The next fact we have got is a mortgage deed, exhibit 80, purported to have been passed by Shitabai on March 23, 1920, mortgaging the suit property with the Society for Rs. 8,800, the loan being repayable by ten equal annual instalments. On the same date, that is, on March 23, 1920, the bank also took a simple bond from Shitabai for the same amount, and the three plaintiffs by their guardian mother Ramabai undertook to be jointly and severally liable to the bank for the due payment of the loan with interest. Under the composition scheme of 1919 Govindrao had to deposit a sum of Rs. 3,331-9-6 in Court. He did this two days after the date of the mortgage deed, that is, on March 25, 1920. The defendant Society sought to recover the first three instalments due under the mortgage deed by applying to the Registrar of the Co-operative Societies, and on April 20, 1924, an arbitration decree was passed under the Co-operative Societies Act, entitling the Society to recover the claim of Rs. 5,048-8-8 with costs and future interest either personally from the defendants or by sale of the mortgaged property in the hands of the said defendants. The defendants in that case were shown thus :

(1) Shitabai kom Ramchandra Venkatesh.

(2) Ranichandra Govmdrao.

(3) Bhimaji Govindrao.

(4) Madhavrao Govindrao.

(5) Ramabai kom Govind.

4. The application for arbitration was made under Co-operative Societies Act, II of 1912, and the rules framed thereunder. In 1926 the Bank made another application to the Registrar in respect of three other instalments due in March, 1926, and there was another arbitration award, this time under the Bombay Co-operative Societies Act, VII of 1925. On October 31, 1927, the plaintiffs Filed the Present suit wherein they alleged inter alia that when the mortgage deed, exhibit 80, was passed, Shitabai was not in need of money, that the amount was in reality required by Govindrao himself, that Shitabai could not have given her free consent to the transaction, that she had been unconscious at the time and could not have understood the nature of the transaction, that the deed was accordingly fraudulent and that the debt was not binding on the plaintiffs. They prayed inter alia that the Court should declare that the transaction evidenced by exhibits 80 and 85 was hollow for want of executant's, free consent and on account of undue influence and fraud and therefore was. not binding on the plaintiffs personally or as Shitabai's heirs. They further prayed that the arbitrators' awards should be declared void not only on the above grounds but also because of gross negligence of their mother in the Court of the arbitrators and that the Court should issue a permanent injunction restraining the defendant Society from executing the said awards. Lastly, they prayed that if the above claims were not tenable in the case of plaintiff No. 1, the Court should declare that the debt did not bind plaintiffs Nos. 2 and 3 or their rights in the suit property.

5. The main defence of the defendant Society was that the suit to set aside the awards made under the Co-operative Societies Act was not maintainable, that the transaction in suit was not vitiated by want of Shitabai's free consent or undue influence or fraud, and that the suit was barred by limitation. In this Court the defence as to limitation has not been argued and certain issues raised, in the lower Court, viz., issues Nos. 2, 4 and 5 which related to the claim against the plaintiffs personally, were not pressed. There was one issue raised in the lower Court, viz., issue No. 6, 'Were plaintiffs members of the Society?' on which the learned Subordinate Judge has remarked : 'This issue is not pressed because under Section 54 of the Co-operative Societies Act a dispute referred to therein includes a claim by the Society for debts or demands due to it from a member or the heirs or assets of the past member.

6. The learned Subordinate Judge set aside two bonds, exhibits 80 and 85,. in respect of the last four instalments so far as the said bonds related to the interests of plaintiffs Nos. 2, and 3 and also set them aside wholly so far as they related to the personal liability of all plaintiffs and dismissed the rest of the plaintiffs' suit.

7. Both the plaintiffs and the defendant Society have appealed.

8. The main point argued by the learned advocate for the defendant in these appeals was that the suit was barred under the provisions of Sections 54, 57 and 70 of Bombay Act VII of 1925 and under Rules 28 and 33 made under Section 43 of Act II of 1912. I would observe that in the defendant's written statement there appears no reference to the Co-operative Societies Act, and that issue No. 1 raised in the lower Court is in these terms :

Whether a suit lies to set aside the award made by the arbitrator appointed under the Co-operative Societies Act

This issue, therefore, refers to the award of the arbitrator under Section 57 of the Bombay Act VII of 1925. The learned Subordinate Judge, however, considered the applicability of Section 54 but not altogether in the manner in which the learned advocate for the defendant has sought to apply that section in this case. The judgment of the learned Subordinate Judge, again, has made no reference to the earlier India Act II of 1912 nor to the rules made thereunder. As the earlier arbitration award of 1924 was passed before the passing of Bombay Act VII of 1925, the Act which would apply to that award would be India Act II of 1912; and Mr. Murdeshwar has accordingly based his arguments so far as they relate to this award on the earlier Act and the rules made thereunder. His reference to Section 70 of Bombay Act VII of 1925, however, was made for the first time in this Court. Neither in the lower Court nor in the memorandum of appeal has the defendant sought to base his case on this section. We have, however, allowed Mr. Murdeshwar to argue his case as regards the application of both the Acts including Section 70 of the later Act. Rules 28 and 33 made under Section 43 of Act II of 1912 are substantially in the same terms as Sections 54 and 57 respectively of Bombay Act VII of 1925.

9. I take the argument as regards the actual awards first. Section 57 of Bombay Act VII of 1925 is as follows :

An order passed in appeal under Section 56 shall be final and conclusive. The award of the arbitrators or a decision by the Registrar or his nominee under Section 54 shall not be liable to be called in question in any civil or revenue Court.' Under Section 54, if any dispute touching the business of a society arises between members or past members of the society or persons claiming through a member or past member or between members or past members or persons so claiming and any officer, agent, or servants of the society or between the society or its committee, and any officer, agent, member, or servant of the society, it has to be referred to the Registrar for decision by himself or his nominee, or if either of the parties so desires, to arbitration of three arbitrators. In this case it seems the Registrar's nominee decided the dispute in both the cases. The terms of Section 57 of the Act, which corresponds to Rule 43 under the old Act, prima facie show that the award of the arbitrators or a decision by the Registrar or his nominee cannot be called in question in any civil Court. This has been held in two cases of this Court, Bharmakka v. Mallappa (1925) 28 Bom. L.R. 598, and Cooverjee Plumber v. Vasant, &c.;, Society : AIR1935Bom91 . In the first case, which was in respect of an award made under India Act II of 1912, Macleod C.J. remarked (p. 600):

Once it is conceded that where a dispute lies between a Co-operative Society and a member who is dead, proceedings can be continued or entertained between the Society and the legal representatives of the deceased debtor, the arbitrators would be competent to decide who were the legal representatives of the deceased debtor and would have jurisdiction to decide that question, even though they might come to a wrong conclusion.

Similarly, in our opinion, when a question may arise as to whether there operative has been undue influence or fraud in any transaction involved in the reference to the Registrar under the Act, that would be a question for the arbitrator to decide and would not, therefore, be a matter into which a civil Court would be competent to inquire. In the second case, viz., Cooverji v. Vasant, etc., Society, it was held that a suit to set aside an award of arbitrators or a decision by the Registrar or his nominee arrived at under the provisions of the Bombay Co-operative Societies Act, 1925, cannot be entertained by a civil Court under Section 9 of the Civil Procedure Code, read with Section 57 of the Act.

10. Mr. Jahagirdar has, however, contended, in the first place, that the award, exhibit 91, cannot be regarded as a proper award under the Act, because though as a matter of fact the plaintiff might be the heirs of Shitabai, they were sued before the Registrar not as such heirs but as sureties to the mortgage loan, In exhibit 85 the plaintiffs have stood sureties for the mortgage loan and Ramabai, their mother, has affixed her thumb impression 'for herself and for her minor sons.' The award, exhibit 91, shows that not only the plaintiffs but Ramabai herself were made defendants and the award makes all of them personally liable. The plaintiffs have not been shown therein as Shitabai's heirs. Mr. Jahagirdar, therefore, has argued that the plaintiffs must have been sued as sureties and not as heirs of Shitabai. It is not denied, though the issue on this point does not appear to have been pressed in the lower Court, that the plaintiffs were not at any time members of the defendant society. Mr. Jahagirdar has contended that the Registrar ought not, therefore, to have entertained the dispute in the form in which it came, before him. He has invited our attention to Tulasiram v. Chairman, Municipal Council, Madura I.L.R. (1931) 55 Mad. 298, and has argued that where an arbitrator has entertained a dispute when he was not competent to do so, he must be held to have acted beyond his jurisdiction, and a civil Court would have the authority to set aside the award passed in such circumstances. It appears to us difficult to accept this view. The other award has not been produced, nor the arbitration papers underlying exhibit 91, and it seems to us not easy to ascertain how in the arbitrator's Court the plaintiffs were actually treated. The point, again, has been raised by Mr. Jahagirdar in this Court for the first time, and the case relied on by him has no reference to the provisions of the Co-operative Societies Act. It seems to us that in enacting Section 57 of the Co-operative Societies Act the Legislature clearly intended that where an arbitrator has passed an award under this Act, it will not be open to a civil Court to go behind that award and to call in question any matter which might have arisen in connection with the decision of the dispute which necessitated that award. There is no doubt that the Act curtails, the ordinary right of a person to go to a civil Court, and that it should therefore be strictly construed; and there also appear to be some probabilities in favour of Mr. Jahagirdar's contention. But there is equally no doubt that the plaintiffs are, as a matter of fact, Shitabai's heirs and that the dispute between them and the defendant society was, as a matter of fact, entertainable by the Registrar under the Act. We do not, therefore, see sufficient reason for holding that either of the two awards was not a proper award operative under the appropriate Act.

11. Mr. Jahagirdar has urged a second reason in this connection, viz., that fraud was committed on the Court of the arbitrator and this constitutes a ground for setting aside the awards, The fraud alleged is that the minor plaintiffs were treated as majors and that Ramabai herself was sought to be made and actually made liable. In this connection Mr. Jahagirdar has drawn our attention to two rulings of the Allahabad High Court, viz., Mahadeo Prasd v. Taki (1902) I.L.R. 25 All. 19. Bibi and Raghunandm Ahir v. Sheonmdan Ahir I.L.R. (1918) All. 182. Again this is a new point which had not been urged at any earlier stage. It does not also seem to us very clear that in this respect the defendant Bank did anything which might be construed as fraud on the arbitrators. Nor has Mr. Jahagirdar been able to refer to any decision of any other High Court in this connection; and we think it unnecessary to consider the applicability of the legal principle in question to the facts of the case.

12. As regards the portion of the loan not covered by the two awards, Section 54 of Bombay Act VII of 1925 and the corresponding rules under the old Act appear to apply. That section runs thus :

If any dispute touching the business of a society arises between members or past members of the society or persons claiming through a member or past member or between members or past members or persons so claiming and any officer, agent, or servant of the society or between the society or its committee, and any officer, agent, member or servant of the society, it shall be referred to the Registrar for decision by himself or his nominee, or if either of the parties so desires, to arbitration of three arbitrators, who shall be the Registrar or his nominee and two persons of whom one shall be nominated by each of the parties concerned.

A dispute shall include claims by a society for debts or demands due to it from a member or past member or the heirs or assets of a past member whether such debts or demands be admitted or not.

13. There can be no question that this part of the loan gave rise to a dispute between the defendant society and the deceased Shitabai who admittedly was a member of the society. Mr. Jahagirdar has argued that the first part of this section should not be held to exclude the jurisdiction of a civil Court. We cannot agree with this view, as the wording of the section makes it clear that all disputes of the nature described must be referred to the Registrar or to arbitration as stated therein. The jurisdiction of the civil Courts in such disputes must, in view of Section 9 of the Civil Procedure Code, be held to be impliedly barred.

14. Mr. Jahagirdar's next main argument is that the terms of the second paragraph of this section show that disputes which are excluded from the jurisdiction of the civil Courts must be disputes wherein claims are made, by a society for debts or demands due to it from a member or past member or the heirs or assets of a past member. This construction, again, does not appear to us to be correct, as this second paragraph appears to have been inserted in the section merely with the object of making it clear that the claim by a society for debts or demands, whether such debts or demands be admitted or not, ought to be regarded, for the purpose of this section, as a 'dispute' The word 'include' snows that this paragraph is not meant to be an exhaustive definition of a dispute. We, therefore, hold that the awards made in the Court of the arbitrators are not liable to be called in question in a civil Court and that as regards the rest of the mortgage loan also the jurisdiction of the civil Court is barred.

15. We now come to Mr. Murdeshwar's argument based on Section 70 of the Bombay Co-operative Societies Act. This section runs as follows :-

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 wording of this section follows that of Section 80 of the Code of Civil Procedure. It is not denied that in this case no notice in writing was delivered to the Registrar or left at his office before the present suit was instituted. Mr. Jahagirdar has argued that this section has been enacted for the benefit of the societies themselves and that it is capable of being waived, and he contends that in the present case the requirements of this section were as a matter of fact waived by the defendant society. He has referred us to Manindra Chandra Nandi v. Secretary of State for India I.L.R. (1907) 34 Cal. 257, which was a case under Bengal Act IX of 1880, and as the Secretary of State was a party, the question of notice under Section 424(corresponding to the present Section 80 of the Civil Procedure Code) arose in that case. Therein Mr. Justice Mookerjee said (p. 282) :-

A notice under Section 424 of the Civil Procedure Code is given for the benefit of the defendant, and it may be presumed that the intention of the Legislature was that the Secretary of State should have an opportunity of investigating the alleged cause of complaint and of making amends, if he thought fit, before he was impleaded in the suit. There is nothing to prevent the defendant from waiving the notice or from being estopped by his conduct from pleading the want of notice at the trial. This is amply borne out by the cases of Davey v. Warne (1845) 14 M. & W. 199. Edwards v. The Great Western Railway Co. (1851) 11 C.B. 588, and Arnold v. Hamel (1851) 11 C.B. 588. Under the circumstances disclosed in the case before us, it appears to me that the right to a notice of action was waived. It has further to be observed that, if the objection had been taken, as it ought to have been taken, when the application for amendment of the plaint was made, it would have been open to the plaintiff to bring a separate action in respect of the claim for the refund of the income-tax after due service of notice under Section 424 of the Civil Procedure Code. But not only was objection not taken on the ground of want of notice but when leave was granted to amend the plaint, it was actually taken at a time when, if the objection was allowed to prevail and the plaintiff was driven to institute a separate suit for the recovery of the income-tax, he would be successfully met with the plea of limitation.

Mr. Jahagirdar contends that the same arguments would apply in the present case in which the objection based on Section 70 of the Bombay Co-operative Societies Act was not taken until Mr. Murdeshwar began to argue the present appeal. He has further pointed out that in the subsequent rulings which lay down that the provisions of Section 80 of the Code of Civil Procedure are mandatory the argument of Mookerjee J. in this case does not appear to have been considered. In Bhagchand Dagdusa v. Secretary of State for India (1927) L.R. 54 IndAp 338 : 29 Bom. L.R. 1227, their Lordships of the Privy Council held as follows (p. 357):-

Section 80 is express, explicit and mandatory, and it admits of no implications or exceptions....

To argue, as the appellants did, that the plaintiffs had a right urgently calling for a remedy, while Section 80 is mere procedure, is fallacious, for Section 80 imposes a statutory and unqualified obligation upon the Court.

No notice as required under Section 80 had been given in that case, and their Lordships held that the appellants had commenced their suits before the law had allowed them to sue and that therefore they were entitled to no relief. Though in this case the arguments relied upon in Manindra Chandra Nandi v. Secretary of State for India were not noticed or discussed, it seems to us that this case clearly concludes the matter, and that when the requisite notice under Section 80 of the Code has not been given before the institution of this suit, it must be held that such an omission prevents the Court from taking cognizance of the dispute involved. This was affirmed in a later Calcutta case, Jagadischandra Deo Dhabal Deb v. Debendraprasad Bagchi I.L.R. (1930) 58 Cal. 850. In this case it was held :-

Section 80 is express, explicit and mandatory, and it admits of no implications as to the notice, we think it was the duty of the court to look into the plaint and when, on the face of it, there was no averment as to service of the notice, the court should have held that the suit was one which could not be instituted, and should reject the plaint, instead of going on with the suit.

This case, it may be observed, makes no reference to the earlier decision in Manindra Chandra Nandi v. Secretary of State for India. Even if that earlier decision were applicable in the present case, it is to be observed that there has been no waiver of the notice by the Registrar; and it cannot, in our opinion, be argued that because the defendant did not raise any objection on the ground of want of notice, it can be said that the Registrar in effect has waived the requisite notice. The facts of the present case are not thus on all fours with those in Manindra Chandra Nandi v. Secretary of State for India. In our opinion, the clear decision in Bhagchand's case leaves no room for the waiver of the requisite notice in this case, and it must be held that the mandatory requirements of Section 70 of the Bombay Co-operative Societies Act have not been observed. In Maruti v. Nomdev Co-operative Society (1934) 37 Bom. L.R. 68, also it was held that the terms of Section 70 of the Bombay Co-operative Societies Act are mandatory, and we see no reason to take any other view.

16. The result, therefore, is that both under Sections 54 and 57 of the Bombay 'Co-operative Societies Act and the corresponding provisions of the earlier Act, and also under Section 70 of the Act of 1925, the lower Court was precluded from considering the merits of the present suit. That being so, it is not necessary for us to go into the merits of this case which were really a subject-matter for the arbitrators to decide upon. We may, however, make one or two observations as to the general facts of this case. In the first place, we find that the learned arbitrators have passed decrees against the plaintiffs personally; and as two of them, besides, were minors, those decrees appear to us to open to objection on more grounds than one. As regards the alleged fraudulent nature of the mortgage transaction and the part that the defendant society has taken therein, we do not feel ourselves called upon to make any remarks except that the defendant society appears to have gone be hind the composition scheme sanctioned by the Court : exhibit 94 shows that the amount originally due to them which included future and penal interest was fully satisfied, and it seems that the Bank has throughout treated the loan of Rs. 8,800 as taken by Govindrao himself. Mr. Murdeshwar has admitted that Govindrao took the initiative in getting this loan from the defendant Bank. As we understand that the plaintiffs have filed appeals to the Registrar of the Co-operative Societies against the awards of the arbitrators, these of course will be matters for the Registrar to consider and decide upon.

17. We accordingly, hold that the plaintiffs' claim must fail and the suit is accordingly dismissed. We allow appeal No. 109 and dismiss appeal No. 110.

18. As regards costs there is little doubt that if the defendant society had relied on Section 70 of the Bombay Co-operative Societies Act in the lower Court, that would have clarified the issues and in all probability stopped the litigation from coming to this Court. In view of that, we allow the defendant half his costs in both the Courts, the plaintiffs beating their own costs throughout.

N.J. Wadia, J.

19. In my opinion the plaintiffs' suit must be dismissed under Section 70 of the Bombay Co-operative Societies Act VII of 1925. That section provides that :-

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.

It is admitted that no notice had been given with regard to the present suit. The provisions of Section 70 are similar to those of Section 80 of the Civil Procedure Code. The section is mandatory, and the consequence of the plaintiffs' failure to give notice is as if their action had never been brought. As was held in Bhagchmd Dagadusa v. Secretary of State for India (1927) L.R. 54 IndAp 338 : 29 Bom. L.R. 1227 :-

It was unsustainable in limine. They commenced their suit before the law allowed them to sue, and can get no relief in it either by declaration or otherwise.

It was contended, however, that as the defendant Bank had not raised this objection in the trial Court or even in the memorandum of appeal but had raised it only in the course of the arguments, it must be taken to have waived the objection and should not be allowed to raise it at this late stage, when any fresh suit by the plaintiffs would be barred by limitation. Reliance has been placed on the ruling in Manindra Chandra Nandi v. Secretary of State for India. I.L.R. (1907) Cal. 257. It was held in that case that (p. 282) :-

A notice under Section 424 of the Civil Procedure Code is given for the benefit of the defendant, and it may be presumed that the intention of the Legislature was that the Secretary of State should have an opportunity of investigating the alleged cause of complaint and of making amends, if he thought fit, before he was impleaded in the suit. There is nothing to prevent the defendant from waiving the notice or from being estopped by his conduct from pleading the want of notice at the trial.

The objection in that case was taken at a time when, if it had been allowed to prevail and the plaintiff had been driven to institute a separate suit for the recovery of the income-tax, he would have been successfully met with the plea of limitation. It was held that (p. 282) :-

It is well settled that, if provisions of law are waived in the course of a trial, they cannot afterwards be set up by way of objection to any step taken or about to be taken upon the footing of the waiver;....

That was a ruling under Section 424 of the Civil Procedure Code corresponding to the present Section 80, under which a notice to the Secretary of State is necessary before he can be sued. The principle laid down was that the provisions of the section were meant for the benefit of the defendant and he could waive them or could be held by his conduct to have waived them. A notice under Section 70 of the Bombay Co-operative Societies Act has to be served not on the defendant Society but on a third party, the Registrar, and it cannot be held that the conduct of the defendant in not raising the objection at the proper time could deprive the Registrar of a right which the law gives him. The section requires the fact of notice to be mentioned in the plaint and it is the duty of the Court to see that the mandatory provisions of the section are complied with. There has been no waiver of notice in this case by the Registrar. The contention of the appellant Bank (defendant) in appeal No. 109 of 1931 must therefore prevail and that appeal must be allowed and the plaintiffs' suit dismissed.

20. It is clear that the plaintiffs' suit was also barred under Sections 54 and 57 of the Co-operative Societies Act. The plaint did not allege that the defendant had practised any fraud on the arbitrators, and the plaintiff cannot now be allowed in appeal to allege such a fraud. The rulings, Mahadeo Prasad v. Takia Bibi I.L.R. (1902) 25 All. 19, and Raghunandan Ahir v. Sheonandan Ahir I.L.R. (1918) All. 182, which were cited on behalf of the plaintiffs, would not therefore help them.

21. It was argued that Sections 54 and 57 cannot apply when the arbitrators have acted ultra vires, and it was contended that in this case the arbitrators had no jurisdiction because the plaintiffs were parties to the proceedings not as heirs of Shitabai but as sureties, and no guardian for the minor plaintiffs was appointed in the arbitration proceedings. The award does not state clearly whether the plaintiffs were made parties as heirs of Shitabai and whether Ramabai, the mother of the plaintiffs, who was a party to the proceedings, was a party in her own right or as guardian of the minor plaintiffs. The question is one of mixed fact and law. If this objection had been taken in the trial Court, the defendant Bank might have been in a position to prove from the record of the arbitration proceedings that the plaintiffs had been made parties as heirs of Shitabai. It is not disputed that if they had been joined as heirs the arbitrators had jurisdiction under Section 54. The learned trial Judge says m Ws judgment : 'At the date of these proceedings Shitabai was dead and hence the present plaintiffs were made parties to the proceedings as heirs and representatives of the said Shitabai, because Shitabai has left a will bequeathing all her estate including the plaint property to the present plaintiffs.' An issue was framed (issue No. 6) 'were plaintiffs members of the society,' and in paragraph 22 of the judgment the learned Judge says : 'This issue is not pressed because, under Section 54 of the Bombay Co-operative Societies Act a dispute referred to therein includes a claim by the society for debts or demands due to it from a member or the heirs or assets of the past member.' This finding shows that it was apparently conceded during the trial that the plaintiffs had been sued as heirs of Shitabai. No objection was evidently taken at that stage that though the plaintiffs were heirs they were not sued before the arbitrators as such. The piaint itself contains an admission in paragraph 8 that in the proceedings before the arbitrators the minor plaintiffs were represented by their guardian Ramabai. There is therefore enough material before us to enable us to hold that the plaintiffs, who are admittedly the heirs of Shitabai, were sued before the arbitrators as such. The arbitrators were, therefore, acting within their powers, and under Sections 54 and 57 their awards could not be questioned in a civil Court.

22. I agree, therefore, with the orders made by my learned brother.


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