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Bheenmal Co-operative Marketing Society Vs. Sumerpur Co-operative Society - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtRajasthan High Court
Decided On
Case NumberS.B. Civil Regular First Appeal No. 170 of 1972
Judge
Reported in1985(1)WLN208
AppellantBheenmal Co-operative Marketing Society
RespondentSumerpur Co-operative Society
DispositionAppeal dismissed
Cases ReferredOrs. v. Moolchand and Anr.
Excerpt:
.....1965 - section 75--jurisdiction of civil court--dispute between two co-operative societies--held, civil suit is barred.;when there is dispute between two co-operative societies or a dispute regarding the business of the co-operative society then section 75 sub-clause (1)(c) would come into play and the civil suit would be barred.;(b) rajasthan co-operative societies act, 1965 - section 137--jurisdiction of civil court--question whether appointment of arbitrator is valid or award suffers from an infirmity--held, it cannot be agitated in civil court.;similarly, the question whether the arbitrator's appointment is valid or invalid or his award suffers from any infirmity cannot be agitate in a civil court in view of section 137 of the act.;appeal dismissed - - 5. not satisfied with this..........business of the cooperative society then section 75 sub-clause (1)(c) would come into play and the civil suit would be barred.16. i am, therefore, of the opinion that the trial court was justified in holding that the civil suit was barred. similarly, the question whether the arbitrator's appointment is valid or invalid or his award suffers from any infirmity cannot be agitated in a civil court in view of section 137 of the act which reads as under:section 137. bar of jurisdiction of courts: (1) save as provided in this act, no civil or revenue court shall have any jurisdiction in respect of.(a) the registration of a cooperative 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.....
Judgment:

G.M. Lodha, J.

1. This is a first appeal against the judgment of Additional District Judge No. 2, Jodhpur in civil suit No. 6 of 1971 whereby the suit of the plaintiff has been dismissed on a preliminary issue regarding jurisdiction.

2. Both plaintiff and defendant are registered Co-operative Societies functioning under the provisions of the Rajasthan Co-operative Societies Act, 1965.

3. The appellant supplied goods to respondent No. 1 for sale on commission basis as pertaining to usage prevailing in Sumerpur where the respondent No. 1 does his business. There was dispute about the transactions and the sale price including the accounts. On 7-1-65 Rs. 3000/- were paid to the plaintiff's Manager. A Hundi was drawn for Rs. 10,000/- on respondent No. 1. This Hundi was not honoured. The plaintiff filed a suit for Rs. 22,893.45 P. However, before filing the suit the developments which took place are much more important and they may be noticed now.

4. The plaintiff moved an application under Section 75 of the Rajasthan Co-operative Societies Act. One Shanker Lal Shah was appointed Arbitrator to submit the award within two months. Shri Shah could not give the award and in his place Ganpatlal Dave was appointed as Arbitrator. His term was extended. He gave his award ultimately.

5. Not satisfied with this award the plaintiff filed appeal in the Cooperative Tribunal Jaipur and this appeal No. 14/69 was dismissed on 2 6-70 by an order mentioning the facts, the points raised and adjudicating them.

6. The plaintiff then filed this suit.

7. In this suit a preliminary objection was raised regarding jurisdiction and issue was framed, 'Whether the Civil Court has got jurisdiction over the subject-matter of the present suit'. The trial court heard the parties. Because both the parties decided not to lead evidence and argued the case purely as a legal issue. The trial court in a very elaborate judgment considered the various provisions of the Rajasthan Co-operative Societies Act.

8. It has noticed that definition of Registrar under Sub-clause (1) of Section 2 of this Act is as under:

'Registrar' means a person appointed to perform the function of the Registrar of Cooperative Societies under this Act, and includes any person appointed to assist the Registrar when exercising all or any of the powers of the Registrar.

It then notices that Sub-clause (2) of Section 3 Government is empowered to confer power of Registrar or to assist the Registrar on any person and such person should exercise such powers of Registrar. It then noticed the notification of January 1, 1966 in which the State Government appointed Deputy Registrar of different Zones of Co-operative Societies to exercise powers of the Registrar. Various other powers were given to them including the relevant powers. The Deputy Registrar, therefore, got powers under Section 77 and Section 75 of the Act.

9. The trial Court then noticed Section 75 and Section 77 and rightly held that all disputes between the Co-operative Societies regarding their business has to be referred to Registrar or to Deputy Registrar by virtue of the above notification and jurisdiction of the Civil Court to entertain any such suit is expressly barred.

10. The present suit is positively a suit between the two Marketing Co-operative Societies in respect of their business dealings and they are covered by Sub-clause 1(d) of Section 75 of this Act.

11. The contention of Mr. Bhoot is that the appointment of the Arbitrator was illegal and the award given by him is nullity and the civil court, therefore, has got jurisdiction. He placed reliance upon the decision given in Dacca Co-operative Industrial Union v. Pacca Co-op. Sankha Silpa Samiti Ltd. and Ors. AIR 1934 Cal. 23. Undoubtedly in the above case it was held that such a suit can be entertained in a civil court to challenge the procedure adopted by the Arbitrator and the person who cannot be appointed as an Arbitrator has been appointed as Arbitrator. Such an award would be nullity.

12. The trial court correctly pointed out that the provisions of Section 75 and Section 137 of the Rajasthan Co-operative Societies Act are peculiar and there were no such provisions in the Co-operative Societies Central Act which governed that case. This finding was given on the statute of a comparative table contained in Rajasthan Local Acts by Jindal Vol. 2.

Obviously when we have got an express provision in the nature of Section 75 and Section 137 barring the jurisdiction and there was no such express provision in the case referred to above in Dacca Cooperative Industrial Union v. Dacca Coop. Sankha Silpa Samiti Ltd. and Ors. (supra) the judgment of the High Court of Calcutta in these circumstances cannot be in any way help the decision of the present case.

13. Obviously as per the scheme of Section 75 and Section 77 a reference has been made regarding the dispute by the Registrar or Deputy Registrar when empowered as the present case is, and it is not in doubt that the present reference was made. Further the procedure is to be noted in Section 76 and Sub-section (1) of Section 75 empowers the Registrar to extend the period for submission of the award. He could even withdraw the dispute from one Arbitrator and decide the dispute himself or refer it again to another person.

14. It is significant to note that no qualification of the Arbitrator has been prescribed as the minimum qualification and, therefore, any one can be appointed Arbitrator. In Usuf Ali v. Azad Bidi Works Co-operative Societies, Buadi 1969 RLW 500 Hon'ble Justice Jagat Narayan as he then was while dealing with the analogous provision of Section 61 Clause (1) of the earlier Act of 1953 equivalent to Section 75 of the new Act held that Civil Court cannot entertain a dispute concerning the business of the society. The same view was reiterated in Kamai Hath Karga Vastra Utpadak Sahakari Samiti Ltd. Santwatsar Madan-ganj, Kishangarh and 3 Ors. v. Moolchand and Anr. 1968 WLN 82.

15. It would thus be seen that the present position of law is well settled that when there is dispute between two Co-operative Societies or a dispute regarding the business of the cooperative society then Section 75 Sub-clause (1)(c) would come into play and the civil suit would be barred.

16. I am, therefore, of the opinion that the trial court was justified in holding that the civil suit was barred. Similarly, the question whether the Arbitrator's appointment is valid or invalid or his award suffers from any infirmity cannot be agitated in a civil court in view of Section 137 of the Act which reads as under:

Section 137. Bar of jurisdiction of courts: (1) Save as provided in this Act, no civil or revenue court shall have any jurisdiction in respect of.

(a) the registration of a cooperative 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-operatives Society;

(2) While a Co-operative Society is being wound up, no suit or other legal proceeding 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 what so ever.

An appeal lies and the plaintiff did prefer an appeal under Section 133 of the Act.

17. The result of the above discussion is that the finding of the trial court that the suit is barred in view of Section 75, Section 77 and Section 137 of the Rajasthan Co-operative Societies Act, suffers from no infirmity and calls for DO interference.

18. Consequently the appeal fails and is hereby dismissed. However, the parties are directed to bear their own costs.


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