Bombay High Court
Mahalaxmi Majoor Sahakari ... vs Kolhapur Jilha Majoor Sahakari ... on 12 December, 2011
Bench: G. S. Godbole
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ast
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO. 2045 OF 2011
Mahalaxmi Majoor Sahakari Sanstha
Mydt., Ichalkaranji, Kolhapur. ....Petitioner.
Vs.
Kolhapur Jilha Majoor Sahakari Sansthancha
Sangh Ltd., Kolhapur & ors. ....Respondents
Mr. Amit B. Borkar, Advocate for Petitioner.
Mr. P.S. Dani i/b. Mr. Chetan G. Patil, Advocate for Respondent No. 1.
CORAM:- GIRISH GODBOLE, J
DATED:- DECEMBER 12, 2011
ORAL ORDER :
1. On 25th April, 2011 notice for final disposal of the Petition at the
stage of admission was issued and accordingly I have heard Mr. Borkar
Advocate for the Petitioner and Mr. Dani, Advocate for Respondent No. 1
who has entered appearance. Rule. Rule made returnable forthwith and
heard by consent of the parties.
2. Petitioner is the original disputant in Dispute No. 629 of 2009 filed
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in the Cooperative Court No. 1 at Kolhapur. According to the Petitioner,
the Opponent Nos. 2 to 42 Societies could not have been enrolled as
members of the Opponent No. 1 Society and the Resolution No. 2 dated
26/3/2008 passed by the Managing Committee of the Opponent Society is
void ab initio. The principal reliefs in the Dispute are a declaration that
the Resolution No. 2 dated 26/3/2008 is void ab initio, illegal, ultravirus
of the provisions of law of Opponent No.1; declaration that the Resolution
No. 2 dated 26/3/2008 is incapable of being implemented and that no
rights have accrued in favour of the Opponent Nos. 2 to 42 on the basis of
the said resolution and a permanent injunction restraining the Opponent
No. 1 from implementing the said resolution and for restraining the
Opponent Nos. 2 to 42 from exercising their rights as members of
Opponent No. 1.
3. In this Dispute some of the Opponents filed an application for
rejection of the dispute under Order 7 Rule 11(d) of the Code of Civil
Procedure, 1908 on the ground that the Registrar has exclusive
jurisdiction to decide as to whether the Opponent Nos. 2 to 42 were
entitled to become members of the Opponent No. 1 Society. This
application was contested by the Petitioner.
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4. By the Judgment and Order dated 21/7/2010 the learned Judge of
the Cooperative Court No. II, Kolhapur rejected the Dispute No. 629 of
2009 on the ground that the question of eligibility and non-eligibility of a
person to become a member can be decided only by the Registrar under
Section 11 of the M.C.S. Act, 1960. It was held that the issue involving
dispute as to membership, expulsion and disqualification of the Managing
Committee Members was outside the scope of Section 91 of the M.C.S.
Act, 1960. Reliance was placed on the Judgment of the learned Single
Judge (C.L.Pangarkar, J) in Ramchandra K. Pitale v/s. Scientific
Cooperative Hsg. Soc. Ltd. & ors.1
5. Aggrieved by the Order of rejection of the Dispute, the Petitioner
filed A.O. No. 47 of 2010 in the Maharashtra State Co-operative Appelate
Court, Mumbai at Pune Bench, which was also dismissed by the
impugned Judgment and Order dated 14/7/2011 leading to the filing of the
present Writ Petition.
6. Shri Borkar, learned Advocate for the Petitioner advanced the
following submissions :-
1 2010(1) Mh. L.J. 232.
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(a) Provisions of Order 7 Rule 11(d) do not apply to Cooperative Court
as Section 94 makes only certain provisions of C.P.C. as referred therein
applicable to the dispute under Section 91. He relied on the Judgment of
R.M.S.Khandeparkar, J in Murlidhar Datoba Nimanka & ors. v/s.
Harish Balkrushna Latane & ors.2 and the Judgment of M.S. Deshpande,
J in P & T Central Co-op. Society Ltd. v/s. Judge, Co-operative Court,
Nagpur & ors.3 in support of his first submission.
(b) That there cannot be an implied bar so as to exercise the power of
summary rejection of the dispute. The bar contemplated by Order 7 Rule
11(d) has to be an express bar. In support of this proposition, he relied
upon the Judgment of the Supreme Court in Prem Lala Nahata and Anr.
v/s. Chandi Prasad Sikaria4 and particularly paragraphs - 16 and 17
thereof.
(c) That the provisions of Section 11, 22 or 23 of the M.C.S. Act, 1960
have absolutely no application.
(d) That the Petitioner was complaining about violation of bye laws of
Respondent No. 1 Society and there was no dispute as to the nature of
business of the Respondent Nos. 2 to 42 and, hence, Section 11 has no
application.
2 2003(4) Mh. L.J. 196
3 1987 Mh. L.J. 232
4 (2007) 2 SCC 551
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7. On the other hand, Mr. Dani, appearing for the contesting
Respondent No.1 advanced following submissions.
(a) Relying on the notification dated 11/12/2003 issued by the High
Court under the Provisions of Article 227 and 235 of the Constitution of
India which is referred to in paragraph-9.2 of the Judgment of the learned
Single Judge (D.B. Bhosale, J) in A-1 CHS Ltd. v/s. R. Jaikishan & Co.
& ors.5 it was submitted that since the provisions of Civil Manual were
made applicable, rule 8 thereof which contemplates examination of plaint
and rejection of the plaint would make the provisions of Order 7 Rule 11
of the Code applicable to Cooperative Courts and the Cooperative Courts
have therefore power to reject the plaint.
(b) Relying on the proviso to Section 91 it was submitted that all
matters which are required to be decided by the Registrar under the Act
are excluded from the purview of Section 91 of the Act and, therefore, all
such matters cannot be termed as dispute. The dispute regarding
membership and the nature of business carried on by the Respondent Nos.
2 to 42 while being admitted as members of the Respondent No.1 is
therefore exclusively covered by section 11 and, hence, by necessary
implication jurisdiction of the Cooperative Courts was barred under
5 2005(1) Mh. L.J. 118
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section 91.
(c) That Section 11 is very widely worded and the question whether a
person is or is not engaged in or carrying on any profession, business or
employment has to be decided under Section 11 and, by necessary
corollary the said questions are excluded from the purview of a dispute
under Section 91.
(d) It was submitted that the law cannot accept a position where the
Registrar and Court are both empowered to decide one and the same issue.
Relying on Section 22(1A) of the Act it was submitted that it was the
legislative intent that any question of disqualification has to be decided by
Registrar and, therefore, jurisdiction of the Cooperative Court was barred.
(e) It was alternatively submitted by relying on the observations in
paragraph-19 of the Judgment of the Supreme Court in Prem Lala
Nahta(supra) that even if this Court comes to a conclusion that all the
prayers in the dispute cannot be entertained by the Co-operative Court,
this Court should order separate trial of such matters as are held to be
within the purview of Section 91 and direct deletion of the other reliefs.
8. In rejoinder Mr. Borkar submitted that the question as to whether
the Respondent Nos. 2 to 42 Societies are carrying on business as labour
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contractors Societies or not is not the subject matter of the dispute but the
subject matter of the dispute is whether the Respondent Nos. 2 to 42
Societies were eligible for being admitted as members of the Respondent
No.1 since, admittedly, the Respondent Nos. 2 to 42 Societies are
industrial producers Societies. He therefore submitted that section 11 has
no application to the facts of this case.
9. I have carefully considered the rival contentions. It is settled law
that while considering the prayer for rejection of plaint under Order 7
Rule 11(d) is concerned, only averments in the plaint have to be looked
into and no other material can be looked into by the Court. The
Plaintiff/Disputant has averred that the Respondent Nos. 2 to 42 Societies
are not labour contract cooperative societies but they have been registered
as industrial producers cooperative societies. In fact, for deciding this
contention of the Petitioner, Section 11 will have no application. Mr.
Borkar is therefore justified in his contention that the provisions of
Section 11 do not have any application to the facts of this case. To my
mind therefore Section 11 has no application to the facts of the case.
Section 22(1A) which has been relied upon by Mr. Dani also does not
have any application for the simple reason that the Petitioner Plaintiff-
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disputant has not averred about any separate order passed by the State
Government under that section. Section 23 also does not have any
application for the simple reason that it is not a case of either the disputant
or the Respondent that any of the Respondents has not been admitted as
member of the Respondent No.1 Society. Thus, the Trial Court and the
Appellate Court have clearly committed error on the face of record by
holding that the jurisdiction of Cooperative Court has been barred by
provisions of Section 11, 22 and 23.
10. Once this view is taken, question whether the provisions of Order 7
Rule 11(d) of the Code apply to the Cooperative Court or not; which
according to Mr. Borkar do not apply and which according to Mr. Dani do
apply; need not be gone into. It is no doubt true that 2 learned Judges
(R.M.S. Khandeparkar, J and M.S. Deshpande, J) have clearly held that
the Order 39 Rule 11 of the Code and Order 1 Rule 10 are not applicable
to the Cooperative Courts. However, since the Cooperative Court is
expected to hear and decide the suit in summary manner the question
whether the Order 7 Rule 11 (d) or a power akin thereto would enable the
Cooperative Court to reject the dispute only on the basis of the averments
in the plaint in the dispute is a matter which is debatable issue. Since I
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have held that Section 11, 22 and 23 have no application to the facts of the
case, it is not necessary to go into that aspect.
11 As rightly pointed out by Mr. Borkar the Supreme Court in the case
of Prem Lala Nahata(supra) has observed in paragraph-16 that for
summary rejection of plaint under Order 7 Rule 11(d), the Court must
come to a conclusion that from the statement of the Plaintiff in the Plaint
itself, the suit is barred by some law. I have carefully read the entire
dispute and it is impossible to hold that from the pleadings or the
averments in the plaint, the suit can be held to be barred by any law.
12. Hence applying the ratio of the Judgment of the Supreme Court in
Prem Lala Nahata(supra), the conclusion is inevitable that the dispute
could not have been dismissed by the Trial Court.
13. It is now necessary to deal with the Judgment of the learned Single
Judge in Ramchandra K. Pitale (supra). Paragraph 12 of the said
Judgment reads thus:
"12. The next aspect that needs consideration is whether the
question as to the dispute about membership could have been
decided by the Co-operative Court. The Society has certainly
disputed the status of the petitioner as a member. The question as
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to whether a disputant is or is not a member cannot be entertained
by the Co-operative Court by virtue of the provisions contained in
section 23 of the Cooperative Societies Act. The jurisdiction
exclusively lies with the Registrar. In the circumstances, the
petitioner ought to have first got determined the status as a
member."
A bare look at the provisions of Section 91 of the M.C.S Act, 1960 will
clearly indicate that a person claiming to be a member of a society can
certainly file dispute against the society under section 91. The learned
Single Judge however has proceeded on the basis that such a person must
first get his right as member established by moving the Registrar and only
thereafter he can file a dispute. In my opinion, the said Judgment and
observation in paragraph-12 clearly overlook the provisions of Section 91
and hence do not constitute a binding precedent.
14. The submission of Mr. Dani that the dispute in present case falls
within the exception carved out by the proviso to section 91 also does not
impress me. A careful look at the proviso would indicate that only refusal
of admission to membership by a society to any person qualified therefor
is excluded from the definition of the dispute. In the present case, the
Petitioner is not raising any question in that regard and, in the present
case, it is not the case where membership has been refused. The
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submission of Mr. Dani has therefore no substance.
15. As an outcome of the aforesaid discussion, the Petition deserves to
succeed and is accordingly allowed. The impugned Judgment and Order
dated 21/7/2010 passed by the learned Judge in Dispute bearing S.C.C.K
No. 629 of 2009 thereby rejecting the said dispute under Order 7 Rule
11(d) of the Code of Civil Procedure, 1908 as also the impugned
Judgment and Order dated 14/1/2011 passed by the learned In-charge
Member (Pune Bench), Maharashtra State Co-operative Appellate Court,
Mumbai in A.O. No. 47/2010 being Exh. D and Exh. E respectively to
this Writ Petition are quashed and set aside and the Dispute bearing
S.C.C.K. No. 629 of 2009 is restored to file and shall be heard in
accordance with law. Hearing of the Dispute is expedited.
16. Rule is made absolute in the aforesaid terms with no order as to
costs.
(GIRISH GODBOLE, J)
