Chatra-Serampore Co-operative Credit Society Ltd. v. Akloo Mahato
1944-08-24
body1944
DigiLaw.ai
JUDGMENT Edgley, J. - The Petitioner in this case is the Chatra Serampore Co-operative Credit Society which went into liquidation in September, 1941. The Opposite Party, Akloo Mahato, instituted a suit against the Society for the recovery of Rs. 106-2-6 p. which, according to him, represented his dues in respect of some provident fund money in the hands of the Society. The learned Small Cause Court Judge decreed the suit in favour of the Plaintiff. In this Court it is admitted that the sum claimed by the Plaintiff is actually due to him in respect of his provident fund, and it is also admitted that this case is governed by the provisions of the Co-operative Societies Act (II of 1912) which in July, 1942, was superseded by the Bengal Co-operative Societies Act of 1940. It is also admitted by both, sides that having regard to the principles laid down in the cases of Re: Alliance Bank of Simla, Ltd. v. Dugald McKechnie 28 C. W. N. 721 (1924) and Kshetra Mohan Das v. D. Basu 47 C. W. N 245 (1942), the deposits on account of provident fund money with the Chatra-Serampore Cooperative Credit Society must be regarded as trust funds, and this being the case, the persons entitled to those funds must be held to be creditors entitled to preferential treatment as against any unsecured creditor of the Society or even as against members of the Society itself. 2. The main point, however, which has been urged by Mr. Das in support of this Rule is that the Civil Court has no jurisdiction to deal with the matter. After careful consideration I am of opinion that this argument must prevail. During the course of the dissolution proceedings the Plaintiff sent a letter to the liquidator in which he asked that the amount due to him in respect of the provident fund money might be paid to him within a certain date. Admittedly, this letter was received by the liquidator but he sent no reply thereto. His failure to reply must be regarded, in effect, as an order refusing to comply with the request contained in the Plaintiff's letter. This order was made in the course of the liquidator's duties under sec. 42 of the Act, read with Rule 29 under sec. 43 (i).
His failure to reply must be regarded, in effect, as an order refusing to comply with the request contained in the Plaintiff's letter. This order was made in the course of the liquidator's duties under sec. 42 of the Act, read with Rule 29 under sec. 43 (i). Sec. 42 (b) of the Act provides that "save in so far as is hereinbefore expressly provided, no Civil Court shall have any jurisdiction in respect of any matter connected with the dissolution of a registered Society under this Act." 3. There is no provision either in the Act or in the Rules under which a dispute relating to a matter of this kind can be agitated in the Civil Court. In fact, as pointed out in the case of Meherdi Munshi v. The Inspector, Co-operative Societies 47 C. W. N. 384 (1943), it seems to have been the express intention of the legislature to ensure that in matters of this kind the jurisdiction of the Civil Court should be completely ousted. It will of course be the duty of the liquidator under sec. 42 of the Act to collect all the available assets of the Society, and, in due course, to investigate all claims against the Society, among which claim must be included the admitted claim of the Plaintiff. Further it will be the duty of the liquidator to decide all questions of priority among creditors such as the Plaintiff who are entitled to preferential treatment. But the fact remains that in connection with these matters the Civil Court has no jurisdiction. 4. It follows, therefore, that this Rule must be made absolute, and the decision of the learned Small Cause Court Judge will be set aside. I make no order as to costs.