[Cites 18, Cited by 0]
Karnataka High Court
Sri Suresha vs Additional Registrar Of Co Operative ... on 17 December, 2025
Author: Suraj Govindaraj
Bench: Suraj Govindaraj
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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 17TH DAY OF DECEMBER, 2025
BEFORE R
THE HON'BLE MR. JUSTICE SURAJ GOVINDARAJ
WRIT PETITION NO. 11346 OF 2021 (CS-RES)
BETWEEN
SRI SURESHA
S/O LATE SIDDE GOWDA @ DOLLEGOWDA
AGED ABOUT 48 YEARS,
RESIDING AT NO.26 KENDAVARE NILAYA
2ND FLOOR, 38TH MAIN, 16TH CROSS
ROSE GARDEN J P NAGAR 6TH PHASE
BANGALORE-560 078
...PETITIONER
(BY SRI. JAYAKUMAR S. PATIL., SR. ADVOCATE FOR
SRI. B. PRAMOD., ADVOCATE)
AND
1. ADDITIONAL REGISTRAR OF
COOPERATIVE SOCIETIES
Digitally signed (H AND M) ALI ASKAR ROAD,
by SHWETHA BENGALURU-560 052
RAGHAVENDRA
Location: HIGH
COURT OF 2. M/S BEML EMPLOYEES C-OPERATIVE SOCIETY LTD
KARNATAKA C/O B E M L LIMITED
BENGALURU COMPLEX
NEW THIPPASANDRA POST
BENGALURU-560 075
BY SECRETARY
3. SRI J MUNNAGAPPA
S/O LATE JAYARAMAIAH
AGED ABOUT 53 YEARS,
EX-PRESIDENT
BEML EMPLOYEES COOP SOCIETY LTD
RESIDING AT NO.96 B NAGASANDRA
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YAMALUR POST BENGALURU-560 037
4. SRI N RAMAKRISHNA
EX-VICE PRESIDENT AND
EX-EXECUTIVE DIRECTOR
BEML EMPLOYEES CO-OP SOCIETY LTD
RESIDING AT NO.33 10TH CROSS, 1ST MAIN
YAMALUR POST YAMALUR
BENGALURU-560 037
5. SRI B M YOGESH
S/O B K MARI SHETTY
AGED ABOUT 51 YEARS,
RESIDING AT NO.25/32 2ND FLOOR
8TH MAIN, PALACE GUTTAHALLI
BENGALURU-560 003
6. SRI S BHASKAR
S/O R SHIVA SHANKAR
AGED ABOUT 48 YEARS,
RESIDING AT NO.2894, 14TH A CROSS
BSK 2ND STAGE, BENGALURU-560 070
.... RESPONDENTS
(BY SRI. HARISH A.S., AGA FOR R1;
SRI. M.S. RUDRAIAH., ADVOCATE FOR R2;
R3, R4 & R6 SERVED;
V/O DATED 6.12.2022 NOTICE TO R5 D/W)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227
OF THE CONSTITUTION OF INDIA PRAYING TO ISSUE A WRIT OF
CERTIORARI QUASHING THE JUDGEMENT DATED 09.07.2020
PASSED BY THE KARNATAKA APPELLATE TRIBUNAL, BANGALORE IN
APPEAL NO.253/2018 (CO-OP) (ANNEXURE-A) AND DECLARE IT TO
BE ILLEGAL AND CONTRARY TO THE PRINCIPLES OF NATURAL
JUSTICE AND ETC.
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THIS WRIT PETITION COMING ON FOR ORDERS AND HAVING
BEEN RESERVED FOR ORDERS ON 24.11.2025, THIS DAY, THE
COURT PRONOUNCED THE FOLLOWING:
CORAM: HON'BLE MR. JUSTICE SURAJ GOVINDARAJ
CAV ORDER
1. The Petitioner is before this Court seeking the
following reliefs:
i. Issue a writ of certiorari quashing the Judgment
dated 09.07.2020 passed by the Karnataka Appellate
Tribunal, Bangalore in Appeal No.253/2018 (Co-op)
(Annexure-A) and declare it to be illegal and
contrary to the principles of natural justice; and
ii. Pass any such other order(s), writ, directions as this
Hon'ble Court deems fit in the facts and
circumstances of the case in the interest of justice
and equity.
2. Respondent No.2 - Society had formed a residential
layout and allotted sites to its members. One of the
sites being Site No.15, formed in Sy.No.22/4, 22/6,
22/7 (Renumbered Sy.Nos.45 and 46 and 48)
situated at Channasandra Village, Uttarahalli Hobli,
Bangalore South Taluk, measuring East to West (60
+ 62)/2 feet North to South (72 + 60)/2 feet, totally
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measuring 4026 sq.ft., was allotted in favour of
Respondent No.5-B.M.Yogesh. A sale deed dated
19.1.2013 came to be executed, and Respondent
No.5 was put in possession of the same. Respondent
No.5 sold the said property on 11.03.2013 vide a
registered sale deed in favour of the Petitioner and
Respondent No.6-S.Bhaskar. Respondent No.6
subsequently relinquished his 50% share in the said
property under a registered release deed dated
9.10.2015, subsequent to which the Petitioner claims
to be the absolute owner in possession.
3. The Society had filed a dispute before the Additional
Registrar of Cooperative Society (for short,
'Addl.RCS') seeking relief to direct Respondents No.3
and 4 to pay an amount of Rs.62,05,300/- with
interest at the rate of 18% per annum and cancel the
sale deed dated 19.1.2013.
4. In the said dispute, it was contended that the Board
of the Society is the one that was competent to allot
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the sites. The Board had not allotted any site to
Respondent No.5. Respondent No.4 had no power or
Authority to execute a sale deed in respect of the
scheduled property in favour of Respondent No.5.
The sale deed which had been executed in favour of
Respondent No.5 was so done, ignoring the seniority
of other members.
5. The site, which had been allotted to Respondent
No.5, had immediately been sold within two months
to the Petitioner for a sum of Rs . 62,05,500/-, and
as such, a huge loss had been incurred by the
Society.
6. The Petitioner and Respondent No.6, on appearance,
filed their objections, contending that the dispute is
not maintainable against the Petitioner and
Respondent No.6 since they are not members of the
Society. The Respondent No.3, being the President of
the Society, and the Respondent No.4, being the
Executive Director of the Society, having executed a
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sale deed in favour of the Respondent No.5, is proper
and correct. The Vice-President has also signed the
sale deed as a witness, and for that reason, the
Petitioner believed the sale deed to be proper and
valid. As such, they contended that the Petitioner
and Respondent No.6 were bona fide purchasers for
value.
7. Respondents No.3 to 5 had also filed objections
contending that Respondent No.5 was their member
and the sale deed which had been executed in favour
of Respondent No.5 was proper and valid. No sale
deed could be cancelled by the Addl.RCS. Such
power would vest only with the Civil Court. Section
70 does not provide any power for cancellation.
8. The dispute came to be dismissed on the ground that
the allegation made by the Society was not true and
that Respondent No.1 did not have the Authority to
cancel the sale deed. It is claimed that post such
dismissal, the Petitioner started construction and was
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close to completing the construction of a building by
investing more than Rs. 2 crores.
9. At that stage, an appeal in Appeal No.253/2018 was
filed before the Karnataka Appellate Tribunal, where
an application had been filed seeking an injunction
restraining the Petitioner and Respondent No.6 from
putting up any construction. The matter having been
taken up for final arguments on 26.3.2020, the same
could not be so conducted on account of the Covid-
19 lockdown. It was subsequently taken up on
11.6.2020 and was adjourned to 25.6.2020. On that
day, arguments were heard of Respondent No.2 in
the absence of the Petitioner, and the matter was
reserved for Judgment and Judgment was
pronounced. The Petitioner was not aware of the
posting of the case but came to know about the
impugned Order only in the second week of
November 2020. It is in that background that the
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Petitioner is before this Court seeking the aforesaid
reliefs.
10. Sri. Jayakumar S. Patil., learned Senior Advocate
appearing for the Petitioner, submits that:
10.1. There being a Standard Operating Procedure
and a lockdown, the Petitioner could not
approach the Additional Registrar of
Cooperative Societies and the disposal of the
matter without providing an opportunity to the
Petitioner is bad in law, and in that background,
he submits that the aforesaid relief, which had
been sought, is required to be granted.
10.2. In this regard, he relies upon the decision in the
case of Siddamma vs. Bhavani Housing
Cooperative Society Limited and Ors1, more
particularly Para 7 thereof, which reads as
under:-
7. Even if such a liberal view is to be taken in the
present case on hand, the Authority vested in
the Additional Registrar of Cooperative Societies
1
W.P.No.49491/2015
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would stop short of deciding whether an
allotment made by a society in favour of its
member was valid. But when once a sale deed is
executed and registered, the purchaser becomes
the absolute owner and neither the Authority nor
the Society would have the power to negate the
registered deed unless it is cancelled by a
competent Civil Court.
It may hence be said that a dispute as to the
validity of the sale deed in favour of the
deceased, under whom the Petitioner claims,
could not have been raised before the Additional
Registrar of Cooperative Societies. A reading of
Section 117 of the KCS Act would not also
indicate that the said Authority is vested with
any such power to address the validity of a
registered Sale deed. Consequently, even the
appellate Authority, prescribed under the KCS
Act, would have no jurisdiction to address the
Order passed in such a dispute. The writ petition
is hence held to be maintainable, as the
Petitioner is left with no remedy as against the
impugned Order, in the first of these petitions,
passed by a statutory authority. Further, having
regard to certain glaring circumstances which
are apparent, prima facie, it is a fit case for the
intervention of this Court.
10.3. By relying on Siddamma's case, he submits
that the Additional Registrar of Cooperative
Society cannot decide whether the allotment
made by the Society was valid, once the sale is
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executed and registered, since the purchaser
becomes the absolute owner.
10.4. He relies on the decision in the case of G.
Parameshwara vs. Vittalnagar House
Building Cooperative Society Limited and
Ors.2 more particularly Paras 3, 4, 7, 8 and 27,
which are reproduced hereunder for easy
reference:
3. The petitioner and respondent No. 5 are the
members of respondent No.1, Housing
Cooperative Society. The Petitioner claims that
he was admitted to membership of respondent
No.1-Society in the year 1983 and on
01.04.1991, lease cum sale deed was executed
in his favour by respondent No.1 - Society in
respect of site No.124, measuring 30 ft. x 40 ft
in Sy.No.15 of Bikashipura Village, Uttarahalli
Hobli, Bengaluru South Taluk. The Petitioner
also claims that he was put in possession of the
said property on 04.09.1994.
4. Petitioner alleged that site No.217 was
allotted to respondent No.5 on 9.06.2000 and
the lease cum sale deed was executed in favour
of respondent No.5 on the same day. It is
further stated that on 30.07.2001, the lease
cum sale deed dated 01.04.1991 executed in
his favour in respect of site No.124 was
2
W.P.No.45550/2013
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cancelled without his notice and consent.
Thereafter, on 13.08.2001, the rectification
deed was executed in favour of respondent
No.5 by substituting site No.124 (Petitioner's
site) in place of site No.217 without notice to
the Petitioner.
7. In addition to the prayer to declare the
Petitioner as the owner of the disputed site, the
Petitioner also sought a declaration that the
rectification deed dated 13.08.2001 and the
sale deed dated 08.03.2006 executed by
respondents No.2 and 3 in favour of respondent
No.5 are illegal and nullity in law. The Petitioner
also sought a declaration that the sale deed
executed by respondent No.5 in favour of
respondent No.6 (non-member) on 10.03.2006
as illegal and nullity in law. By way of an
amendment, Petitioner also prayed for
cancellation of the registered cancellation deed
executed on 30.07.2001.
8. The purchaser/non-member took a stand
that Registrar acting under the Act of 1959 has
no jurisdiction to entertain the petition under
Section 70 of the Act of 1959.
27. The co-ordinate Bench of this Court in Smt
Siddamma's case supra has taken a view that
the dispute relating to the transfer of
immovable property or validity of registered
sale deed is not contemplated under Section 70
of Act of 1959. The Court has also taken a view
that the dispute under Section 70 of the Act of
1959 is only confined to the disputes named in
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Section 70(2) (a) to (e) of the Act of 1959, and
once the sale deed is executed and registered,
the purchaser becomes the absolute owner and
neither the Authority under the Act of 1959 nor
the Society will have the power to negate the
registered deed, unless it is cancelled by the
competent Civil Court.
10.5. By relying on Parameshwara's case, he again
reiterates that once the sale deed has been
executed, the Registrar of Cooperative Society
cannot adjudicate on the validity of the sale
deed.
10.6. By relying on the decision of this Court in the
case Mr.Mir Ubaidullah vs. Jaraganahally
House Building Cooperative Society Ltd.,3
He contends that a proceeding under Section
70 is in the nature of arbitral proceedings, and
it is only a personal lis which could be decided.
No Right in Rem could be decided under Section
70, like that of cancellation of a sale deed.
3
CRP No.12/2021 dtd 19.8.2021
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10.7. He relies on the Decision in Mr. Mir
Ubaidullah vs. Jaraganahally House
Building Cooperative Society Ltd4. Paras 13,
14, 15 and 16 thereof, which are reproduced
hereunder for easy reference:-
13. Thus even if there is a dispute which can be
said to impinge upon or touching upon the
constitution, management or business of the
cooperative Society it would have to be seen
whether the Registrar could have granted a
relief of declaration in terms of Section 34 of
the Specific Relief Act, 1963 since it is only a
Civil Court which is empowered to grant such
declaration and the Registrar not being so
empowered there would be no purpose which
would be served by referring the matter to the
Registrar.
14. In this regard reference may also be drawn to
the decision of the Apex Court in the case of
Booz-Allen & Hamilton Inc Vs. SBI Home
Finance Ltd., & Others reported in (2011)5
SCC 532 while dealing with Section 11 of the
Arbitration and Conciliation Act, 1996 wherein
the Hon'ble Apex Court has categorically
defined the disputes which an arbitrator can
adjudicate to be as regards "rights in
personam" and those which are a "right in
rem". The rights in personam are dispute
interparties which would not have impact on
the Society in general or anybody else apart
from the parties to the lis whereas the right in
rem are those which would have an impact on
the Society as a whole.
4
Civil Revision Petition No.12/2021
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15. On that basis, the Hon'ble Apex Court has held
that the matters relating to divorce, mortgage
etc. cannot be referred to arbitrator, since an
arbitrator would not have power to decide such
matters.
16. Applying the said dicta to the present case also
and considering that the Registrar is an
Administrative Officer or at the most a Quasi
Judicial Officer he cannot grant a declaration
sought for which would be a declaration in rem
that is against the Society as a whole since any
declaration of title would apply to the Society
as a whole.
11. Sri.M.S.Rudraiah, learned counsel for the Society,
would contend that:
11.1. By way of the Order dated 9.7.2020, the
Karnataka Appellate Tribunal has only
remanded the matter, to be decided afresh by
Respondent No.1. Even if it is accepted that the
Order of the Appellate Tribunal has been
passed without notice and without hearing the
Petitioner, the same would not cause any harm
or injury since the Petitioner could always place
his say on record before the Additional RCS.
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11.2. His submission is that the transaction which has
been carried out in terms of allotment and
execution of sale deed is contrary to the Bylaws
of the Society and if any of the office bearers
were to act contrary to the Bylaws, it would not
be required for the Society to approach a Civil
Court, there being a remedy available under
Section 70 of the KCS Act, the Society could
always approach the jurisdictional Authority
under the KCS Act.
11.3. His submission is that illegalities committed by
some of the directors by executing a sale deed
cannot preclude the Society from raising a
dispute under Section 70, and by causing such
illegalities, the Society cannot be made to
approach a Civil Court.
11.4. It would be for the concerned authorities to
decide on the matter in accordance with law
and if the actions on part of any of the officers
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of the Society were found to be illegal and or
contrary to the Act or Rules, in that event, the
authorities could pass necessary orders, which
could include cancellation of the allotment and
the sale deed, since the same is carried out
contrary to the applicable Rules and Bylaws.
11.5. In this regard, he relies upon the Judgment of
this Court in the case of A.S.Nanjappa VS.
The Deputy Registrar of Cooperative
Societies5, more particularly, Para 3, which is
reproduced hereunder for easy reference:-
3. xxxxx
It is not in dispute that business of R-2 Cooperative
Society is to acquire the land and form layout and
distribute sites to its members. Therefore, the said
dispute cannot be said to be outside the purview of
Sec.70 of the Cooperative Societies Act. In the
circumstances, this Court is of the opinion that the Deputy
Registrar of Cooperative Societies has committed an error
in dismissing the petition of the Petitioner by holding that
the dispute between the Petitioner and the Society has to
be get it adjudicated in a civil court. Therefore, on the
short ground, Order of the Deputy Registrar as per
Annexure-G dated 7.8.1999 has to be quashed. When this
Court has come to the conclusion that an error has been
committed by the Deputy Registrar of Cooperative Society
in dismissing the dispute of the Petitioner, Order passed
5
W.P.No.42049/2001 dtd 29.9.2005
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by KAT in Appeal No.483/99 as per Annexure-J dated
13.3.2001 is also required to be quashed. Since no
evidence is recorded by the Deputy Registrar of
Cooperative Societies, matter is required to be remitted
back to R-1.
11.6. By relying on A.S.Nanjappa's case, his
submission is that any dispute as regards
allotment of the site, could be decided under
Section 70.
11.7. In this regard, he relies upon the Judgment of
this Court in the case of Sri.Harish N.Puthran
vs. Mahalakshmi Cooperative Bank Ltd.,
and others6, more particularly, Paras 4 to 6,
which are reproduced hereunder for easy
reference:-
4. The Karnataka Appellate Tribunal has held on
facts that the second respondent before it /
petitioner herein had mortgaged his immovable
properties as security for availing loan but during the
subsistence of the mortgage, properties mortgaged
in favour of the bank were sold to respondents 8 to
22 allegedly without the leave of the appellant-bank.
The Karnataka Appellate Tribunal did not go into the
merits of the matter as the preliminary objection
raised before it was confined to the question
6
W.P.No.13915/2011 dtd 23.5.2011
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whether the dispute raised against the members and
non-members together could be maintained before
the Joint Registrar of Cooperative Societies. The
Tribunal has found after referring to Section 70, 117
and 117(3) of the Karnataka Cooperative Societies
Act, 1959 that in view of the expression used
claiming through a member under Section 70 and on
verification of the pleadings of the parties, it was
clear that the dispute was against the members as
well as non-members claiming through the members
and hence, the findings recorded by the Joint
Registrar of Cooperative Societies was
unsustainable.
5 Section 70(1) of the Act states that
notwithstanding anything contained in law for the
time being in force, if any dispute touching the
constitution, management or the business of a
Cooperative Society arises along members, past
members and persons claiming through the
members, past members or deceased members.
such a dispute shall be referred to the Registrar for
decision and no Civil or Labour or Revenue Court or
Industrial Tribunal shall have the jurisdiction to
entertain any suit or other proceedings in respect of
such dispute. It is clear from Section 70(1) that even
if a dispute touching the business of a Cooperative
Society were to arrive among persons claiming
through members, such a dispute is maintainable
and can be legitimately referred for decision to the
Registrar.
6. In the present case, the mortgagor - the
Petitioner has sold the property in favour of the non-
members respondents 8 to 22 during the
subsistence of the mortgage. In the dispute he is
arrayed as a party, so also the principal debtor and
the purchasers of the property. who claim right
under the mortgagor. Therefore, these purchasers
fall within the ambit of the expression 'persons
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claiming through the members' and therefore, the
dispute raised under Section 70 and referred for
adjudication to the Registrar could not have been
rejected by the Joint Registrar of Cooperative
Societies holding that the same was not
maintainable, as the only way they could have been
made party-respondents, was by way of filing an
application to implead them with the leave of the
Authority. When Section 70 makes it clear that the
dispute which arises between the members of the
Society or persons claiming through the members
has to be referred, in the facts and circumstances of
the case, as the purchasers were claiming right over
the property by way of sale deeds executed in their
favour by the Petitioner, who had mortgaged the
very properties in favour of the appellant-bank, it
was unnecessary for the respondent no.1- bank to
raise the dispute first against the members and then
seek leave of the Joint Registrar of Cooperative
Societies to implead the non-members for the simple
reason that the non-members were not total
strangers but were persons who were claiming
through the members. In view of the same, I am of
the considered view that the view taken by the
Tribunal does not suffer from any patent illegality or
error of jurisdiction so as to warrant interference by
this Court in exercise of writ jurisdiction. Hence, the
writ petition is dismissed.
11.8. By relying on Harish N.Puthran's case, he
submits that any dispute touching on the
constitutional management or business of a
Corporative Society would include any
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contention relating to a mortgage. A person,
even though not being a member of the Society
if claiming under a member of the Society
would be covered under Section 70 of the KCS
Act and he submits that even an aspect of
mortgage could be dealt with under Section 70
of the KCS Act.
11.9. He relies upon the Judgment of the Hon'ble
Supreme Court in the case of Deccan
Merchants Cooperative Bank Ltd., vs. M/s
Dalichand Jugraj Jain and others7 , more
particularly, Para 25, which is reproduced
hereunder for easy reference:-
25. The appeal must also fail on the ground that
even if it is a dispute touching the business of the
Society within the meaning of Section 91(1) of the
Act, it is not a dispute between a society and a
member or a person claiming through a member. It
seems to us that before a person can be said to
claim through a member, the claim should arise
through a transaction or dealing which the member
entered into with the Society as a member. If a
member entered into a transaction with the Society
not as a member but as a stranger, then he must be
7
AIR 1969 SC 1320
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covered, if at all, by the provisions of Section
91(1)(a) or (c). But once it is held that the original
transaction was entered into by the member with
the Society as a member then any person who
claims rights or title through that member must
come within the provisions of Section 91(1)(b).
11.10. By relying on Deccan Merchant's case, he
submits that any person who claims right, title
or interest under the member would also come
within the purview of Section 70 of the KCS
Act.
11.11. He relies upon the Judgment of the Full Bench
of this Court in the case of Karnataka Sugar
Workers Federation v. State of Karnataka8
, more particularly, Paras 15, 20 and 21, which
are reproduced hereunder for easy reference:-
15. A perusal of the record reveals that the
subject matter of amendment Act impugned in the
Writ Petition is enacted by the Legislature in exercise
of the power conferred under Entry 32 to List II of
the VII Schedule to the Constitution of India which
deals inter alia with Cooperative Societies and the
bill which was passed by the Legislators of
8
ILR 2003 KAR 2531
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Karnataka was reserved for the assent of the
President. The original records produced by learned
Government Advocate, however, disclose that the
amendment bill 2 of 1997 was introduced in the
Legislative Assembly on 25.8.1997 and was passed
by the Legislative Assembly on 14.5.1998 and was
passed by the Legislative Council on the same day
i.e., 14.5.1998. Thereafter, since the provisions of
Clause 3 were repugnant to the Industrial Disputes
Act, 1947 which is an existing law the bill was
forwarded to the Governor for reserving the same
for the assent of the President of India. The
Governor by Order dated 14.6.1998, reserved the
Bill for the assent of the President and the President
of India gave his assent on 18.3.2000, the same was
published in the gazette on 27.3.2000 and amended
provision has come into effect from 20.6.2000.
20. The other argument raised is that the
Registrar of Societies is not a trained judicial person
where the Presiding Officer of the Labour Court or
Industrial Tribunal is a qualified District Judge, and
therefore, Section 70 should be declared as invalid.
The argument is not attracted as the powers which
have been granted to a Judge of Labour Court or
Industrial Tribunal are quasi-judicial in nature.
Further, he has been empowered under the Statute
and enjoined to resolve the dispute therein.
Similarly, the competent authorities appointed under
various Acts like Shops and Commercial
Establishments Act, Payment of Wages Act,
Workmen's Compensation Act, Employees' State
Insurance Act, are exercising their power to
adjudicate the dispute pertaining to various labour
matters in spite of the fact that they are not
qualified as District Judge. Yet, they are functioning
as Presiding Officers. Be that as it may. The other
argument that the Registrar is likely to be biased in
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favour of management is also not a ground to hold
the amendment invalid as the aggrieved parties are
always entitled to challenge the individual orders, if
necessary.
21. In view of what we have discussed above, we
hold that the provisions of Section 70 of Karnataka
Cooperative Societies (Amendment) Act, 1997 which
has come into effect from 20.6.2000 are valid with
the legislative competence and constitutional.
Therefore, no reconsideration is required as stated.
11.12. By relying on the Karnataka Sugar Workers
Federation's case, he submits that even the
Labour Court or Industrial Tribunal would not
have any jurisdiction if the same relates to a
Cooperative Society.
11.13. He relies upon the Judgment of this Court in the
case of Dattatreya vs. the Assistant
Registrar of Cooperative Societies9 , more
particularly, Paras 8 and 9, which are
reproduced hereunder for easy reference:-
8. The Constitution Bench of the Apex Court in
the case of Dhulabhai (supra) has laid down seven
principles as to when the jurisdiction of Special
Authority/Tribunal excludes that of the ordinary Civil
9
W.P.No.105644/2018 dtd 13.3.2019
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Courts. Going by the stand of the parties, it cannot
be gainsaid that the respondent-ARCS lacks
jurisdiction. The second principle formulated in the
said decision, which squarely applies to the case of
the Petitioner, reads as under:
"(2) Where there is an express bar of the
jurisdiction of the Court, an examination of the
scheme of the particular Act to find the adequacy or
the sufficiency of the remedies provided may be
relevant but is not decisive to sustain the jurisdiction
of the civil Court. Where there is no express
exclusion the examination of the remedies and the
scheme of the particular Act to find out the
intendment becomes necessary and the result of the
inquiry may be decisive. In the latter case it is
necessary to see if the Statute creates a special right
or a liability and provides for the determination of
the right or liability and further lays down that all
questions about the said right and liability shall be
determined by the tribunals so constituted, and
whether remedies normally associated with actions
in civil courts are prescribed by the said Statute or
not."
9. No special circumstances are shown by the
Petitioner justifying exercise of writ jurisdiction by
this Court for granting relief to him, in terms of
prayer. Justice of the case requires that the
Petitioner should chose to appear before the first
respondent Arbitrator and take up appropriate stand
in the ongoing Arbitral Proceedings, in which
admittedly he has already participated. All
contentions of the parties need to be kept open.
11.14. By relying on Dattatreya's case, he submits
that there being no express bar on the exercise
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of jurisdiction, Section 70 dealing with all kinds
of disputes, the concerned Authority under the
Act can deal with even an aspect of illegal
allotment, and cancellation of a sale deed if it
has been so executed in pursuance of illegal
allotment.
11.15. He relies upon the Judgment of the Hon'ble
Supreme Court in the case of A.Jitendernath
vs. Jubliee Hills Co-op, House Bld. Soc. and
anr.,10 more particularly, Paras 54 and 55,
which are reproduced hereunder for easy
reference:-
54. The question which now arises for consideration
is that what would be the effect of allotment of plot
No. 400 in Phase III by the First Respondent during
pendency of the proceedings before this Court. We
have noticed hereinbefore that this Court, while
asking the learned counsel appearing on behalf of
the First Respondent, was of the opinion that
interest of justice may be subserved if some plot
which was available for allotment could be directed
to be allotted in favour of the Appellant herein. A
representation was made, which now turns out to be
10
(2006) AIR SCW 3653
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wrong, on behalf of the First Respondent that the
plot No. 400 was available for allotment. It was in
that situation, the offer of the First Respondent as
regard allotment of the said plot to the Appellant
was accepted. The Appellant paid a huge sum
therefor. The said amount has also been
appropriated by the First Respondent. However, in
law only because an order of allotment has been
issued in favour of the Appellant herein by the First
Respondent, the same by itself would not mean that
thereby the right of the others for being considered
therefor or for that matter any other plot which was
available for allotment could be put in jeopardy. This
Court whence proceeded to consider the matter of
allotment of another plot in favour of the Appellant
by the First Respondent, it had evidently in its mind
that same plot may be available for allotment but by
reason thereof the right of somebody else was not
meant to be nor could be affected. Even in exercise
of its jurisdiction under Article 142 of the
Constitution while making an attempt to do complete
justice to the parties this Court cannot pass an order
which could cause injustice to others and in
particular to those who are not before it. The
correctness or otherwise of the contentions raised by
the impleaded parties, thus, need not be gone into.
We must, however, place on record that our
attention has been drawn to the fact that several
proceedings as regard allotment of plot at the hands
of the Society are pending adjudication before
several forums. Even a direction has been issued by
a Cooperative Tribunal as regard allotment of plot
No. 400. It goes without saying that the courts of
law would always see to it that while making
allotment of plot by a cooperative society, no
discrimination is caused amongst the members.
xxxxx
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55. We, therefore, are of the opinion that
interest of justice would be subserved if the First
Respondent is directed to consider the question of
allotment amongst its members upon strict
compliance of the extant rules including its bye-laws
wherefor cases of all persons eligible therefore must
be considered.
11.16. By relying on Jitendernath's case, he submits
that it being a mandate that there is no
discrimination between the members of the
Society as regards allotment of plots, if there is
any violation of the applicable law, the same
would have to be dealt with under Section 70 of
the KCS Act.
11.17. He relies upon the interim Order passed by this
Court in the case of Sri.M.Shashidharan and
others vs. Joint Registrar of Cooperative
Societies and others11, more particularly,
Para 6, which is reproduced hereunder for easy
reference:-
11
W.P.Nos.9869-9876/2016 dtd 7.8.2017
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6. Keeping in the mind the facts and
circumstances of the case and also the interest of
the petitioners as well as Respondent No.3-Society
and its members, I am of the view that the interim
Order granted on 10.03.2016 deserves to be
modified. Accordingly, the following modification is
made:
It is made clear that pending disposal of these
writ petitions, respondent No.3-Society shall not
make any allotment/execution of sale deeds without
following the seniority list of its members as
approved by the concerned Registrar of Cooperative
Societies. Interim Order passed on 10.03.2016 is
accordingly modified.
11.18. By relying on Shashidharan's case, he
submits that if the seniority list is violated and
an allotment is made, it would be for the
Registrar to deal with such allotment and if
there is a violation of the applicable law, to hold
the allotment made to be bad and
consequently, set aside the sale deed.
11.19. He relies upon the Order dated 24.11.2015 in
CRP No.130/2012, more particularly, Para 4
thereof, which is reproduced hereunder for easy
reference:-
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4. On perusal of Sections 70 & 118 of the Act, it is
clear that if any dispute arises between the
cooperative Society and its members with regard
to the business of the Society, such dispute shall
have to be referred to the Registrar for
adjudication and no court shall have jurisdiction to
entertain any suit or other proceeding in respect
of such dispute. Therefore, it is apparent from a
reading of Section 70 along with Section 118, that
Civil Court has no jurisdiction to adjudicate the
dispute regarding non-allotment of site by the
defendant-Society to the plaintiff, because such a
dispute which touches the business of the Society
has to be necessarily referred to the Registrar for
adjudication in terms of the provision under
Section 70 of the Act. The Trial Court, was
therefore, in total error in dismissing the
application.
11.20. By relying on Byanna's case, his submission is
that if there is any dispute which arises
between the cooperative Society and its
members with regard to the business of the
Society, such dispute would have to be referred
to the Registrar for adjudication, and no Court,
including the trial Court, would have
jurisdiction.
11.21. He refers to the decision of the Hon'ble
Supreme Court in the case of Thakur Jugal
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Kishore Sinha vs. Sitamarhi Central Co
operative Bank Ltd & another12 , more
particularly Para 11 thereof, which is
reproduced hereunder for easy reference:-
11. It will be noted from the above that the
jurisdiction of the ordinary civil and Revenue courts
of the land is ousted under Section 57 of the Act in
case of disputes which fell under Section 48. A
Registrar exercising powers under Section 48 must
therefore be held to discharge the duties which
would otherwise have fallen on the ordinary civil
and Revenue courts of the land. The Registrar has
not merely the trappings of a court but in many
respects he is given the same powers as are given
to ordinary civil courts of the land by the Code of
Civil Procedure including the power to summon and
examine witnesses on oath, the power to order
inspection of documents, to hear the parties after
framing issues, to review his own Order and even
exercise the inherent jurisdiction of courts
mentioned in Section 151 of the Code of Civil
Procedure. In such a case, there is no difficulty in
holding that in adjudicating upon a dispute referred
under Section 48 of the Act, the Registrar is to all
intents and purposes a court discharging the same
functions and duties in the same manner as a court
of law is expected to do.
11.22. By relying on Thakur Jugal Kishore Sinha's
case, he submits that the jurisdiction of the
ordinary civil and revenue courts, once ousted
by a specific provision, the said Court cannot
12
1967 SCC Online SC 60
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exercise jurisdiction it would have to be
adjudicated by the Authority, prescribed under
the Statute.
11.23. By relying on the above, he submits that the
writ petition is required to be dismissed.
12. Heard Sri. Jayakumar S.Patil, learned Senior Counsel
for the Petitioner, Sri. Harish A.S., learned counsel
for Respondent No.1, Sri.M.S.Rudraiah, learned
counsel for Respondent No.2 and perused papers.
13. The points that would arise for determination are,
1) Whether the Additional Registrar of
Cooperative Societies could in a dispute
raised before him under Section 70 of the
KCS Act cancel a sale deed which has been
registered? If so, under what
circumstances?
2) Whether the impugned Order passed by
the KAT suffers from any legal infirmities
requiring interference at the hands of this
Court?
3) What Order?
14. I answer the above points as follows:
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15. Answer to Point No.1: Whether the Additional
Registrar of Cooperative Societies could in a
dispute raised before him under Section 70 of
the KCS Act cancel a sale deed which has been
cancelled a sale deed? If so, under what
circumstances?
15.1. The submission of Shri. Jayakumar S. Patil,
learned senior counsel, is that the ARCS cannot
decide whether the allotment is valid or invalid,
and on that basis, cancel the allotment and/or
the sale deed once executed. His submission is
that the sale deed having been executed, the
matter can only be agitated before the
competent civil Court, and in this regard,
reliance has been placed on Siddhama's case
and Parameshwara's case. His further
submission is that the validity or otherwise of a
sale deed, being one relating to a right in rem
in proceedings under Section 70 of the KCS Act,
1959, no such declaration could be made, and
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in that regard, reliance is based on Mir
Ubaidullah's case.
15.2. Per contra, Sri.Rudraiah, the learned counsel
for Respondent No.2, submits that it would
always lie with the ARCS to consider if there is
any violation of the bylaws and or the Act has
been made and it would be for the officers
under the Cooperative Societies Act, 1959 to
take necessary action in the event of there
being any violation and in that regard, reliance
has been placed on Nanjappa's case, Harish
N.Puthran's case, Deccan Merchants' case,
Karnataka Sugar Workers Federation's
case, Dattatreya's case, Jitendernath's case
and Shashidharan's case.
15.3. Though the submission of Sri.Jayakumar S.
Patil, learned Senior counsel, is that an order of
cancellation cannot be passed by the Additional
Registrar or any Registrar acting under the KCS
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Act. What is required to be examined is the
context in which the powers are being exercised
inasmuch as the powers being exercised in the
background of there being allegations that
there is an improper or illegal or unauthorised
allotment made where a person who is not
entitled to an allotment has been allotted a site
by not taking the seniority into consideration
etc.,.
15.4. The Governing Body of the Cooperative Society,
having acted illegally, cannot in my considered
opinion, take up a contention that a civil suit
would have to be filed to set right the illegality
committed by the Governing Body. By carrying
out the illegality of execution of a sale deed,
the Society in the present matter, is seeking to
contend that any challenge would have to be
made before the civil Court, and the supervising
authorities under the KCS Act 1959 cannot
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exercise any powers and or take any action
against the Governing Board and or the
beneficiary of the largese extended by the
Governing Board to any particular person. That
in my considered opinion, would amount to
granting a premium for the illegal actions on
the part of the Governing Board as also by the
beneficiary inasmuch as the beneficiary also
was aware that, in normal circumstances, there
could have been no allotment made to the
beneficiary, without following the due
procedure and complying with the applicable
seniority rules etc.
15.5. The cancellation of the sale deed is in
furtherance of the cancellation of the allotment.
The allotment having been made in an illegal or
improper manner, the Additional Registrar and
the other registrars cannot, in my considered
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opinion, be denuded of their power under the
Act to take action against the wrongdoers.
15.6. Merely because the sale deed has been
registered in pursuance of such wrongdoing
would not require the Registrar or any other
person who is aggrieved by such allotment and
execution of the sale deed to file a suit.
15.7. Looked at from another angle, the Governing
Body having performed the illegality, the
Governing Body representing the Society, the
Society would not seek cancellation. If a
subsequent committee comes into being and or
an administrator is appointed, the said
committee and or the administrator cannot be
expected to take action by filing a civil suit to
set right the wrong committed by the
Governing Body. In my considered opinion, all
these issues could be looked into and decided
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upon by the Additional Registrar, exercising
powers under section 70 of the KCS Act.
15.8. This Hon'ble Court in Nanjappa's case has
categorically held that all disputes could be
resolved under section 70, the same having
been confirmed in Harish Puthran's case.
Even if a further sale deed is executed by the
member who has received the undue benefit,
proceedings under Section 70 would be
maintainable against such third party in terms
of the decision of the Hon'ble Apex Court in
Deccan Merchant's case. Moreso as held by
this Court in Karnataka Sugar Workers
Federation, any matter relating to labour and
service issues would also be adjudicated under
Section 70 even though there are separate
Labour Courts and Industrial Tribunals set up
for this purpose, Section 70 of the KCS Act
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ousting the jurisdiction of even such specialised
tribunals.
15.9. In terms of decisions in Jithendranath and
Shashidharan's case, if an allotment of a site
has been made without following the due
procedure or in violation of the seniority,
proceeding under Section 70 would be
maintainable, this relating to the internal
working of the Society and or being a violation
of the applicable Act, Rules, Byelaws to such
Society.
15.10. The decisions in Byanna's case and Thakur
Jugal Kishore Sinha's case also clearly
specify that it is only the designated Authority
under the Statute, that is, the Registrar, who
could adjudicate the disputes in terms of
Section 70. Thus, the allotment of a site being
a business of the Society, any violation of the
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allotment rules would also come within the
purview of Section 70 of the KCS Act.
15.11. As such, I answer Point No.1 by holding that
the Additional Registrar of Corporative Societies
could, in a dispute raised before him under
Section 70 of the KCS Act 1959, cancel the
allotment improperly or illegally made, and
thereafter cancel the sale deed improperly or
illegally executed, even if it is so registered.
Necessary intimation could be sent by the
concerned Registrar to the jurisdictional Sub-
Registrar to do the needful after such
cancellation, of course, before doing so the
person in whose favour the illegal allotment has
been made would have to be heard. Jurisdiction
under Section 70 cannot be entertained as
regards transactions between members or a
member and a third party where there is no
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allegation of violation of KCS Act, KCS Rules,
Society's bye laws or the like.
16. Answer to Point No.2: Whether the impugned
Order passed by the KAT suffers from any legal
infirmity requiring interference at the hands of
this Court?
16.1. In view of my findings to answer to Point No.1,
the KAT, having considered these aspects and
having come to a conclusion that the Board was
not competent to allot the site, though the
contention of Sri Jayakumar S. Patil, learned
senior counsel, is that adequate opportunity
had not been granted. In the present matter,
all and necessary arguments have been
addressed. I am of the considered opinion that
these arguments and contentions, having been
considered by this Court, the Order passed by
the KAT cannot be faulted with.
16.2. Hence, I answer Point No.2 by holding that for
the reasons mentioned by the KAT as well as
the reasons mentioned in the present Order,
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the Order passed by the KAT does not suffer
from any legal infirmity requiring interference
at the hands of the Court.
17. Answer to Point No.3: What oder?
17.1. In view of my answers to Points No.1 and 2, I
pass the following:
ORDER
i) The Writ Petition stands dismissed.
SD/-
(SURAJ GOVINDARAJ)
JUDGE
PRS
List No.: 2 Sl No.: 1
