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Khubilal Vs. Power House Karamchari Girah Nirman Sahkari Samiti - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtRajasthan High Court
Decided On
Case NumberS.B. Civil Reg. Second Appeal No. 557 of 1972
Judge
Reported in1973(6)WLN6
AppellantKhubilal
RespondentPower House Karamchari Girah Nirman Sahkari Samiti
DispositionAppeal dismissed
Cases ReferredBank Ltd. v. Dalichand Jugraj Jain and Ors.
Excerpt:
.....it is for the registrar to decide whether the dispute touches inter alia the business of the co-operative society.;(c) rajasthan co-operative societies act, 1965 - section 137--remedy provided in act--held, jurisdiction of civil court is barred.;the clear import of this section is that where a remedy is provided under this act then no suit or other proceedings shall lie in the civil court, except to the extent permitted by the act itself nor shall it be open to any party to challenge any order, decision or award of any court or the state government under this act by a suit.;(d) rajasthan co-operative societies act, 1965 - section 75--'business of society'--meaning of--taking of deposit is activity of society.;the word 'business' has been used in different senses and in different..........appeal and arises out of a suit for money filed against the defendant respondent, who is a co-operative society, registered under the rajasthan cooperative societies act, 1965 (hereinafter to be referred as 'the act').2.the plaintiff-appellant is a member of the respondent co-operative society. on 28th august, 1961, he claims to have deposited rs. 1,000/- by way of trust with the society and obtained a pass book on 25.2.71. the plaintiff appellant gave a notice to the respondent society for the refund of the amount. since the amount was not refunded, the plaintiff brought the suit against the society in the court of the additional mansif, udaipur. the society contested the suit. it was admitted that rs. 1000/- had been deposited by the plaintiff with the society, but it was denied.....
Judgment:

Kan Singh, J.

1. This is a plaintiff's second appeal and arises out of a suit for money filed against the defendant respondent, who is a Co-operative Society, registered under the Rajasthan Cooperative Societies Act, 1965 (hereinafter to be referred as 'the Act').

2.The plaintiff-appellant is a member of the respondent Co-operative Society. On 28th August, 1961, he claims to have deposited Rs. 1,000/- by way of trust with the Society and obtained a pass book on 25.2.71. The plaintiff appellant gave a notice to the respondent society for the refund of the amount. Since the amount was not refunded, the plaintiff brought the suit against the society in the Court of the Additional Mansif, Udaipur. The Society contested the suit. It was admitted that Rs. 1000/- had been deposited by the plaintiff with the Society, but it was denied that it was by way of trust and it was asserted that it was an advance for the purpose of house according to the arrangement with the Society. It was further pleaded that the suit was not maintainable according to Section 75 of the Act, as it concerned a dispute between a member of the Society and the Society and a dispute was required to be referred to the Registrar, Co-operative Societies and consequently the Civil Court had no jurisdiction to en ertain the suit. It was also pleaded that the suit was not maintainable, as the statutory notice to the Registrar had not been given as required by Section 143 of the Act.

3. The learned Addl. Munsif came to the conclusion that the dispute did not relate to the business of the Society as the amount was not deposited by the plaintiff to the Society in the capacity as a member. The learned Addl. Munsif further held that as the suit was not relating to the business of the Society, no notice was required to be given under Section 143 of the Act In the result he decreed the suit.

4. Aggrieved by the judgment and decree of the learned Additional Munsif the defendant Society went up in appeal to the Court of the District Judge. Udaipur. The appeal was assigned by the District Judge to the learned Civil Judge, Udaipur, for disposal.

5. The learned Civil Judge held that the dispute related to the business of the Society and was between the plaintiff, who was the member of the Society and the Society and, therefore. Section 75 of the Act was attracted. He also held that two months' notice to the Registrar, as laid down in Section 143 of the Act, was required before the filing of the suit. Consequently, the learned Civil Judge allowed the appeal and reversed the judgment and decree of the learned Additional Munsif and remanded the case to him for returning the plaint to the plaintiff It is in these circumstances that the plaintiff has come in further appeal to this Court.

6. Learned Counsel for the plaintiff appellant reiterated that the dispute between the plaintiff and the Society not being as a member of the Society Section 75 of the Act was not attracted and, therefore, the suit was comptent in a civil court. Learned Counsel relied on, 1. Manjeri S. Krishna Ayyar v. Secy., Urban Bank Ltd., Calicut and Anr. AIR 1933 Mad 682; 2. Shyam Cooperative Housing Society Ltd v. Ramibai Bhagwansingh Advani and Ors. : AIR1952Bom445 ; and 3. Deccan Merchants Co-operative Bank Ltd. v. Dalichand Jugraj Jain and Ors. : [1969]1SCR887 I may read Section 75 of the Act:

75. Disputes which may be referred to arbitration (1) Notwithstanding anything contained in any law for the time being in force, if any dispute touching the constitution, management, or the business of a co-operative society arises--

(a) among members, past members and persons claiming through members, past members and deceased members, or

(b) between a member, past member or person claiming through a member, past member or deceased member and the society, its committee or any officer, agent or employee of the society, or

(c) between the society or its committee and any past committee, any officer, agent or employee or any past officer, past agent or past employee or the nominee, heirs or legal representatives of any deceased officer, deceased agent or deceased employee of the society, or

(d) between the society and any other co-operative society,

(e) between the society and the surety of a member, past member or a deceased member, or a person other than a member who has been granted a loan by the society or with whom the society has or had transaction under Section 66, whether such a surety is or is not a member of a society

such dispute shall be referred to the Registrar for decision and no court shall have jurisdiction to entertain any suit or other proceeding in respect of such dispute.

(2) For the purposes of Sub-sections (1), the following shall be deemed to be disputes touching the constitution; management or the business of a co-operative society, namely:

(a) a claim by the society for any debt or demand due to it from a member or the nominee, heirs or legal representatives of a deceased member, whether such debt or demand be admitted or not,

(b) a claim by a surety against the principal debtor whether the society has recovered from the surety any amount in respect of any debt or demand due to it from the principal debtor as a result of the default of the principal debtor, whether such debt or demand is admitted or not;

(c) any dispute arising in connection with the election of any officer of the society.

(3) If any question arises whether a dispute referred to the Registrar under this section is a dispute touching the constitution, management or the business of a co-operative society, the decision thereon of the Registrar shall be final and shall not be called in question in any court.

7. The section opens with a non-obstante clause. This shows that the Legislature was keen to provide that ordinarily the co-operative societies should not be dragged in civil courts, if this could be avoided. The Act has provided a comparatively cheap and a speedy remedy in disputes concerning a Society. The words 'touching the constitution, management or the business of a cooperative society' have to be given their full import. The word 'business' has been used in different senses and in different contexts, but its ordinary dictionary meaning is 'activity' occupation, function'. It is also note worthy that where a member is concerned in any dispute with the Society, the dispute must involve the character of the person as such a member and not otherwise than a member This was the view of the Bombay High Court in Shyam Co-operative Housing Society Ltd. v. Ramibai Bhagwansing Advani and Ors. : AIR1952Bom445 , which has been affirmed by the Supreme Court in Deccan Merchants Co-operatives Bank Ltd. v. Dalichand Jugraj Jain and Ors. : [1969]1SCR887 The Madras case cited by learned Counsel for the appellant is also to the same effect. But here the question is as to which authority has to decide in the first instance the question whether the dispute referable to the Registrar is a dispute 'touching the constitution, management or the business of a co-operative society'. Sub-section (3) of Section 75 to my mind makes it clear that whenever any dispute is referred to the Registrar, it is for the Registrar to decide whether the dispute touches inter alia he business of the co-operative society and in that event the decision of the Registrar shall be final and shall not be called in question in any Court.

8. Section 137 of the Act creates a bar to the jurisdiction of courts and I may read that section as well:

137. Bar of jurisdiction of courts: (I) Save as provided in this Act, no civil or revenue court shall have any jurisdiction in respect of,

(a) the registration of a co-operative society or of an amendment of a bye-law;

(b) the removal of a committee;

(c) any dispute required under Section 75 to be referred to the Registrar; and

(d) any matter concerning the winding up and the dissolution of a co-operative society.

(2) While a co-operative society is being wound up, no suit or other legal proceedings relating to the business of such society shall be proceeded with, or instituted against the liquidator as such or against the society or any member thereof, except by leave of the Registrar and subject to such terms as he may impose.

(3) Save as provided in this Act, no order, decision or award made under this Act shall be questioned in any court on any ground whatsoever.

9. This section shows that where a dispute is required to be referred to the Registrar, then save as provided in this Act, no civil or revenue court shall have any jurisdiction in respect of it. The clear import of this section is that where a remedy is provided under this Act then no suit or other proceedings shall lie in the civil court, except to the extent permitted by the Act itself; nor shall it be open to any party to challenge any order, decision or award of any Court or the State Government under this Act by a suit. Thus where prima facie a matter seems to fall within the purview of the Registrar, the party should first approach the Registrar. It is only a question of fact whether the amount was deposited by the plaintiff with the Society in his character as the member of the Society or otherwise. The dispute regarding this could be gone into by the Registrar. There is no manner of doubt in my mind that the deposit undoubtedly related to the business of the Society The term business, as already noticed, means the 'activity, occupation or function' of the Society. Taking of the depot-it was undoubtedly an activity of the Society. Therefore the only point of dispute, in the present case could be whether the plaintiff was dealing with the Society in making the deposit in his capacity as a member of the Society or otherwise.

10 According to Sub-section (3) of Section 75 of the Act such a question has to be determined by the Registrar. That being so Section 137 of the Act will bar the jurisdiction of a civil court. In creating Registrar as Tribunal the Legislature has clothed him with the power to determine the collateral question about his jurisdiction under Sub-section (3) of Section 75. Apart from this, in certain specified matters in Section 135 of the Act, the Registrar has been given all the powers of the civil court, which it has while trying a suit. The court below was, therefore, right in holding that the suit was not triable by a civil court.

11. As regards the question of suit being not maintainable for want of a proper notice, to the Registrar Section 143 is quite clear. I may read this Section:

143. Notice necessary in suits.- No suit shall be instituted against a cooperative society or any of its officers in respect of any act touching the constitution, management or 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.

12. This section clearly bare the institution of a suit against a co-operative society in respect of any act touching the constitution, management or the business of the society until the expiration of two months next after notice in writing has been delivered to the Registrar. Even if the plaintiff were not suing the Society in his capacity as a member, the notice under this section would be necessary, as the suit was in respect of an act concerning the business of the Society. Admittedly no notice has been given to the Registrar, as required by this section The suit was, therefore, not maintainable on this ground as well.

13. The appeal is thus without any force and accordingly it is hereby dismissed. The parties are left to bear their own costs of this Court.


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