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1969 DIGILAW 107 (ALL)

Kastha Kala Udyog Sahkari Samiti Ltd. v. State of U. P

1969-03-31

SATISH CHANDRA

body1969
JUDGMENT Satish Chandra, J. - The petitioner took a loan from the State Government for setting up an industry under agreement dated 15th March, 1963. The petitioner defaulted in paying the agreed instalments. The respondents, therefore, launched proceedings for recovery of the amount of the loan as an arrear of land revenue. 2. The petitioner which is a cooperative society alleges that the respondents are threatening to arrest the President of the Society and his brother in the course of the recovery proceedings. It has also been stated that the respondents have illegally arrested the Secretary of the Society Mr. Junaid and have retained him in civil lock-up for about two weeks. The petitioner challenges the. recovery procecdings on two grounds. It was at first urged that the Public Moneys (Recovery of Dues) Act, 1965, was unconstitutional because it violated the guarantee of equality under Article 14 of the Constitution. This point has been Negatived by me in Tandon Sugar Works v. U. P. Financial Corporation, 1968 A.L.J. 39 In the present case also the petitioner in the agreement executed by it agreed that the loan may be recovered as an arrear of the land revenue. 3. It was then urged that the respondents could not recover the loan by arrest of the office bearers of the petitioner Society. In this respect the facts are not quite clear. The arrest of Mohd. Junaid, who happened to be the Secretary of the Society, was in the course of realisation of dues against him personally. The respondents have in their counter affidavit clarified this. No rejoinder affidavit has been filed. Consequently the arrest of Mohd. Junaid cannot be attributed to the loan due from the Society. 4. The allegation that the respondents are threatening to arrest the President and the brother of the President of the petitioner Society has not been clearly denied in the counter affidavit. It may be that the petitioner's apprehensions in this regard have some substance. 5. In my opinion when the defaulter is a cooperative society, which is registered under the Cooperative Societies Act, and is as such a juristic personality it is an entity distinct from its office bearers. It may be that the petitioner's apprehensions in this regard have some substance. 5. In my opinion when the defaulter is a cooperative society, which is registered under the Cooperative Societies Act, and is as such a juristic personality it is an entity distinct from its office bearers. In proceedings for recovery of any loan as arrears of land revenue from the Society as such, the office bearers of the Society would not be liable to be arrested simply because they happen to be the office bearers. Such office bearers could be proceeded against personally only if there was some authority either under the agreement or some provision of law. None such provision has been brought to my notice. On the materials before me it is difficult to say that the respondents would be entitled to arrest the President or other office bearers of the Society in the course of the realisation of dues from the petitioner Society. The Petition, therefore, succeeds and is allowed in part. The respondents are directed not to arrest the petitioner Society's President other office bearers, in the course of realisation of the dues from the petitioner Society. The parties would, however, bear their own costs.