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1946 DIGILAW 232 (CAL)

Chatra Co-Operative Society Ltd. v. Satkari Mukherjee

1946-08-13

body1946
JUDGMENT Chakravartti, J. - On the 16th of November, 1925, Respondent No. 2, who is a member of the Appellant Co-operative Society, borrowed from the Society a sum of Rs. 300. Respondent No. 1, who is also a member, stood surety for him. The Society brought a suit for the recovery of this debt and on the 18th of March, 1929, obtained a decree for Rs. 436-2-9 pies. This decree was put into execution on the 10th of June, 1929, but on the 1st of May, 1930, the execution case was dismissed for default. No further steps were thereafter taken for the execution of the decree. On the 29th of August, 1940, the Society filed a dispute before the Registrar, claiming the aforesaid sum of Rs. 300 from the Respondents, together with interest. Notice of this application appears to have issued to the Respondents and the dispute was in due course referred to an arbitrator. The order-sheet of the arbitrator contains an order dated the 26th of December, 1941, in which it is stated that the notices had been served on the Respondents and they appeared before him and admitted the Society's claim. An award was passed by the arbitrator on the 23rd of December, 1941, for Rs. 433-14-9 pies. Neither of the Respondents preferred any appeal against this award or took any other steps to question it. 2. On the 2nd of July, 1942, the Bengal Co-operative Societies Act (XXI of 1940) came into operation. On the 22nd of July, 1943, the Society put the award into execution and there out arose the execution case to which the present appeal relates. The application for execution was met by the Respondents with an objection under sec. 47 of the CPC to the effect that the award passed by the arbitrator was without jurisdiction, inasmuch as there was and could be no dispute which could have been referred to him. Both the Courts below have given effect to this objection and dismissed the execution case and it is against that decision that the Society has appealed. 3. Mr. Das, who appears in support of this appeal, has taken three points before me. In the first place, he has argued that the Courts below erred in holding that in the facts of the present case, there could be no dispute which might be referred to the decision of an arbitrator. 3. Mr. Das, who appears in support of this appeal, has taken three points before me. In the first place, he has argued that the Courts below erred in holding that in the facts of the present case, there could be no dispute which might be referred to the decision of an arbitrator. He has contended in the second place that, in any event, the executing Court had no jurisdiction to enquire into the matter, specially having regard to the fact that the Respondents were present at the proceedings under the Co-operative Societies Act and did not in any way challenge the Society's claim. He has contended in the last place that apart from the general disability of an executing Court to go behind the decree on a ground such as the one urged in the present case, there was a special disability under the Co-operative Societies Act which prevented Civil Courts from enquiring into matters of this kind. 4. The argument on behalf of the Respondents was put before the Courts below and repeated in this Court in the following manner. It was stated that the claim under the bond had been put into litigation and had merged in a decree. The execution of that decree had become barred by time. There was, therefore, no enforceable claim alive, on the basis of which the Society could raise any dispute or in respect of which any dispute could possibly occur. With the extinction of the right to execute the decree under the law of limitation, the claim of the Society against the Respondents had indisputably disappeared. The whole foundation of the jurisdiction of the arbitrator, so the argument proceeded, was the existence of a dispute and if there could be no dispute in fact or in law, the arbitrator, even if he had passed an award, had done so without jurisdiction and the executing Court was entitled to disregard it as inexecutable. If there was no valid claim at all, there was no matter capable of being agitated in civil litigation and consequently no dispute on which a valid award could be founded. 5. In my view this contention is palpably fallacious. The civil suit as well as the dispute was filed by the Society at a time when the old Co-operative Societies Act was in force. 5. In my view this contention is palpably fallacious. The civil suit as well as the dispute was filed by the Society at a time when the old Co-operative Societies Act was in force. But the executing Court had to consider the question at a time when the new Act had come into operation. Both the Courts below have applied that Act and leaving aside the question as to which Act would apply, I might first examine the contention advanced in terms of the new Act which found favour with them. Sec. 2, cl. (j) of the new Act, defines a dispute in the following words: 'dispute ' means any matter capable of being the subject of civil litigation, and includes a claim in respect of any sum payable to or by a cooperative society; 6. It will be seen that the crucial words in this definition are "any matter capable of being the subject of civil litigation." In my view, it is impossible to say that if the recovery of a decretal debt by execution of the decree is time-barred, a claim for the debt, which the creditor may nevertheless put forward, is not a matter capable of being the subject of civil litigation. The definition does not obviously contemplate only good claims or claims valid in law: anything which can form the subject-matter of adjudication by a Civil Court comes under the definition. Indeed, if someone seeks to enforce a time-barred claim, not only is there ground for a dispute, but there would be ground for a more violent dispute than would ordinarily occur. The main contention, upon which the Respondents' opposition to the execution is based, is, in my view, not warranted by the definition of dispute as contained in the new Act. 7. Both the Courts below have given effect to the Respondents' objection by reference to the new Act. 8. But it may be said, although it was not said before me, that since the reference to arbitration took place at a time when the old Co-operative Societies Act was in force, the existence or non-existence of a dispute must be judged by the terms of that Act and not by the terms of the statute, since enacted. Even if that be so, the Respondents would be in no better position. Even if that be so, the Respondents would be in no better position. The question as to what would constitute a dispute under the terms of the Co-operative Societies Act of 1912 fell to be considered by a Division Bench of this Court in the case of Dacca Co-operative Industrial Union, Ltd. v. Dacca Co-operative Sankha Silpa Samities, Ltd. (1037) 42 C.W.N. 391 . At page 399 of the report, their Lordships define the subject-matter of a dispute, touching the business of the Society, in the following manner : Advancing loans to its members and receiving payments and recovering the loans are acts of management, and fall within the ordinary duties and powers of the Committee. The Committee is to make the demand for re payments from a member on behalf of the Society and if the demand is resisted, there arises a dispute between the member and the Committee. 9. Here again, it is worthy of note that all that a dispute requires is that the Society should make a demand of payment from a member. It is not required that the demand should be a demand sustainable in law or capable of surviving judicial scrutiny. In my view, therefore, whether the definition in the present Act is regarded or the principles laid down by this Court by reference to the old Act, there was. in the present case, a dispute which was capable, of being referred to arbitration and it cannot be said that the award of the arbitrator was without jurisdiction on the ground that no dispute existed at all. 10. This, in reality, disposes of the appeal, since the above was the only ground upon which execution of the award was refused; but I am of opinion that the second and third contentions of Mr. Das are also correct. The limits to which an executing Court can go in examining the validity of a decree have not been very consistently defined by the decisions of this Court. The decision of the Full Bench in the case of Gora Chand Halder v. Prafulla Kumar Roy (1023) 99 C.W.N. 948 stated that the decree must be one, apparently without jurisdiction. The limits to which an executing Court can go in examining the validity of a decree have not been very consistently defined by the decisions of this Court. The decision of the Full Bench in the case of Gora Chand Halder v. Prafulla Kumar Roy (1023) 99 C.W.N. 948 stated that the decree must be one, apparently without jurisdiction. The verb " apparently" was subsequently elucidated in the case of Amalabala Dasi v. Sprat Kumari Dassi (1981) 54 C.L.J. 593 where it was held that for the purpose of deciding whether the Court passing the decree had or had not the jurisdiction to pass it, reference could be made to the decree and other relevant papers that might be necessary for understanding it. In the Full Bench case itself, however, the want of jurisdiction was established by evidence adduced for the purpose and there are other cases to be found in the books where, it would seem, the executing Court was allowed to travel outside the record. One such case is the decision in Biswanath Lahiri v. The Chatra Serampore Co-operative Credit Society, Ltd. (1937) 41 C.W.N. 887 where the judgment-debtor was allowed to prove by evidence that he was a member of the Co-operative Society which had obtained a decree against him from the Civil Court and that therefore the decree was a nullity. But whatever want of uniformity there may be with regard to opinions expressed on this matter, there is none on the question that if the judgment-debtor was present at the proceedings in which the decree was passed and he did not then traverse the allegation upon which the jurisdiction of the Court depended, he would not be allowed to raise that objection or the first time in the executing Court by way of attacking the decree on the ground of want of jurisdiction. In the present case, the order-sheet of the arbitrator shows that the Respondents, having been served with notice, were present before the arbitrator and admitted the Society's claim. In the circumstances it seems to me that it is not open to them now to say that there was no enforceable claim subsisting against them and therefore there was no dispute which only could be a legal foundation of an award made under the Co-operative Societies Act. 11. Mr. In the circumstances it seems to me that it is not open to them now to say that there was no enforceable claim subsisting against them and therefore there was no dispute which only could be a legal foundation of an award made under the Co-operative Societies Act. 11. Mr. Pal contended that no consent could confer jurisdiction on a tribunal, if in law the tribunal had no jurisdiction. That, undoubtedly, is true; but no question of conferring jurisdiction in the present case arises. The only question is whether there was or was not an enforceable claim and if the Respondents admitted that there was. they were merely making an admission of fact. It is to be remembered that when the execution of a decree becomes barred by time, the legal position which results is only that the remedy is barred, but the liability is not extinguished. There was thus nothing to prevent the Respondents from admitting as honest debtors, that they were in fact liable to the Society. 12. There is lastly the third difficulty in the Respondents' way, created by the special provisions of the Co-operative Societies Act. Sec. 86 of the Act provides that any dispute, touching the business of a Cooperative Society, may be referred to the Registrar. Sec 87 provides that on receipt of a reference under sec. 86, the Registrar shall, subject to the rules, decide the dispute himself or refer it for disposal to one or more arbitrators. Sec. 134 provides that an appeal shall lie from an award passed by an arbitrator and that, subject to result of any such appeal, every award shall be final. Sec. 135 provides for revision by the Provincial Government. These are all sections relating to remedies provided for by the Act itself and to be pursued under the Act. On the other hand, sec. 133 provides that save as provided in the Act, no Civil or Revenue Court shall, to quote only the relevant portion, have any jurisdiction in respect of any dispute required under sec. 86 to be referred to the Registrar. It is true that sub-sec. On the other hand, sec. 133 provides that save as provided in the Act, no Civil or Revenue Court shall, to quote only the relevant portion, have any jurisdiction in respect of any dispute required under sec. 86 to be referred to the Registrar. It is true that sub-sec. (3) of the section saves the power of the Civil Court to disregard or set aside or modify an award on the ground of want of jurisdiction but if this ground be absent, no matter coming within the purview of a dispute, as denned in the Act, can in any way be agitated in a Civil Court. If it cannot be agitated in a Civil Court in a direct and straightforward manner, it is impossible to say that it can still be indirectly agitated in an executing Court, by challenging the validity of the award there. It is true that the award is challenged in the present case on the ground of want of jurisdiction. That, however, brings us back to the first point as to whether any dispute could be said to have existed in the present case. If there, was a dispute, namely, a matter capable of being the subject of civil litigation or a failure to pay a demand made by the Society, then the award is final and the Respondents, if they wished to dispute the claim, had either to put forward their objections before the arbitrator which they did not, or appeal against the award which also they failed to do. But the executing Court could have no power to entertain their objection and give them any relief on the ground that the award itself had been wrongly made. 13. It may lastly be pointed out that it is at least a question whether the decree obtained by the Society from the Civil Court was a valid decree at all. The old Co-operative Societies Act of 1912 did not contain any express bar against the jurisdiction of a Civil Court with respect to matters in dispute between a Society and its members. But it seems to have been held in the case of Dacca Co-operative Industrial Union, Ltd. v. Dacca Co-operative Sankha Silpa Samitics, Ltd. (1937) 42 C.W.N. 391 to which I have already referred, that even under the old Act, the Registrar or the arbitrator was the exclusive tribunal for the adjudication of such matters. But it seems to have been held in the case of Dacca Co-operative Industrial Union, Ltd. v. Dacca Co-operative Sankha Silpa Samitics, Ltd. (1937) 42 C.W.N. 391 to which I have already referred, that even under the old Act, the Registrar or the arbitrator was the exclusive tribunal for the adjudication of such matters. If so, the decree obtained by the Society from the Civil Court would be a nullity and neither its existence, nor the expiry of the limitation for executing it, could affect the Society's claim against the Respondents. It is, however, not necessary for me to pursue this matter further. 14. For the reasons given above, I am of opinion that the Courts below were in error in giving effect to the objection of the Respondents and dismissing the Society's application for execution. 15. The appeal is accordingly allowed. The orders of both the Courts below are set aside and the executing Court is directed to proceed with the execution in accordance with law. I make no order as to costs. Leave to appeal under clause 15 of the Letters Patent has been asked for. I invited the learned Advocates at the beginning of the hearing to take the case to a Division Bench, if they so wished. But they declined to do so. In the circumstances, the leave asked for is refused.