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1972 DIGILAW 422 (ALL)

Tilhar Sahkari Kraya Vikraya Samiti Ltd. , Tilhar v. Ram Swarup

1972-10-04

A.K.KIRTY, C.D.PAREKH

body1972
JUDGMENT A.K. Kirty, J. - The Appellants made an application Under Rule 137(ii) of the Rules framed under the U.P. Co-operative Societies Act (Act II of 1912). An award was made in (favour of the Appellant on 8th January, 1966. Under that award a sum of Rs. 27,313. 37p. was payable by the Respondent to the Appellant. An application for execution was made in the Court of learned Civil Judge, Shanjahanpur. The Respondent judgment debtor filed a number of objections u/s 47 of the Code of Civil Procedure. The court below upheld these objections and held that the award in question was without jurisdiction and invalid and therefore, the application for execution of the same was not legally maintainable. The application for execution accordingly was dismissed. 2. On behalf of the Appellant it has been urged before us that the judgment and decree of the court below are manifestly erroneous in law and cannot be maintained. It was argued that the court below, which acting as execution court, acted in excess of jurisdiction by going into matters which it was not entitled to go into as an executing court. In our opinion, the arguments are well sustained. 3. In order to appreciate the controversy between this parties it will be necessary to mention the nature of the objections taken in the court, below (sic) the Respondent. The first objection was that the award itself was without jurisdiction and a nullity and therefore, it could not be legally executed. The second point taken was that the arbitrator Sri. M.A. Rizvi was an officer of the Sahkari Samiti in question; and as such, he could not be appointed as an arbitrator and the award given by Sri Rizvi is without jurisdiction and a nullity because legally he could neither be appointed as an arbitrator nor could act as such. In regard to the second objection, however it may be mentioned that, from, a perusal of the judgment of the Court below it appears that what was actually submitted, on behalf of the Respondent in the court below was that Sri Rizvi being an officer of the Co-operative Department should not have been appointed as, an arbitrator and that the reference, to Sri Rizvi as an arbitrator was done in violation of the principles of natural justice. This contention was repelled by the court below. This contention was repelled by the court below. The relevant part of the judgment of the court below dealing with this question runs thus: The objector has also, challenged the award on the ground that the arbitrator, Sri Rizvi, was an Officer of the Co-operative Department and it was against the principle of natural justice to refer the dispute for arbitration to such a person and further the, award was made without any notice to the objector. Now as regards the first contention, it appears to carry no force when the Act itself provides for the reference of the dispute to such an officer for arbitration. As regards the other contention the same relates only to procedural defect and cannot be raised separately at this stage. 4. The court below on the first objection noted above held that the award itself was without jurisdiction in as much as Ram Swarup Respondent was not a member of the Co-operative Society in question and therefore, there could be no reference to arbitrator of any dispute between the society and a person who was not a member thereof. The court below after hearing the learned Counsel for the parties recorded a finding that Ram Swarup was not a member of the Society. It has been argued before us by the learned Counsel for the Appellant that as an executing court, the learned judge had himself no power to give any finding on the question. It was pointed out that in the award itself, the arbitrator mentioned that Ram Swarup had admitted before him that he was a member of the Society, it was further pointed out that from a perusal of the award, it would be clear that the arbitrator also took into consideration some evidence and material available to him on the basis of which also he was satisfied that Ram Swarup was a member of the Society. This being the position, in our view, it was not open to the court below sitting as an executing court to go behind the award or to question the correctness of any finding given by the arbitrator. Farless had the court any power to record its own finding on a question which presumably was a question of fact. This being the position, in our view, it was not open to the court below sitting as an executing court to go behind the award or to question the correctness of any finding given by the arbitrator. Farless had the court any power to record its own finding on a question which presumably was a question of fact. If an executing court is held to be entitled to question the correctness of a finding of fact recorded in a judgment or a decree or an award, which is being executed, it would virtually amount to converting the executing court into an appellate court. We have heard the learned Counsel for the Respondent at some length. He contended that the award was without jurisdiction in as much as Ram Swarup was not a member of the Society and the finding of the arbitrator to the contrary is illfounded. It was also submitted in this connection that from a perusal of the award it would appear that Ram Swarup became a member some time in 1965, whereas the liability in respect of the amount had arisen in 1964. On this basis, it was argued that Ram Swarup, not being a member of the Society on the relevant date on which cause of action accrued, could not be considered to be a member for purposes of reference to arbitration nor could the arbitrator have any jurisdiction to make an award binding against Ram Swarup. In support of the contention that it is open to an executing court to decide whether a judgment-debtor under an award was or was not a member of the society, reliance was placed by the learned Counsel on a Division Bench decision of the Patna High Court in Nirsu Pande Vs. Emperor, AIR 1934 Patna 145 . In that case, however, the award given by the arbitrator was against two persons, The principal debtor indisputably was a member of the Society. The other judgment debtor was made liable in bare capacity as a surety. The award does not appear to have mentioned whether the surety herself was or was not a member of the society. It was, however, not disputed before the High Court that she was not a member but was merely a surety. The other judgment debtor was made liable in bare capacity as a surety. The award does not appear to have mentioned whether the surety herself was or was not a member of the society. It was, however, not disputed before the High Court that she was not a member but was merely a surety. The Patna High Court held that the provisions of the Co-operative Societies Act and the Rules framed thereunder applicable to the case did not empower the arbitrator to make an award against a person who was not a member but who was only a surety. It was under these circumstances that the Patna High Court held that the award in so far as it affected the surety was without jurisdiction and that an objection in that behalf could legally be raised by the surety in execution proceedings. The Patna case, therefore, is not applicable at all to the facts of the instant case. 5. In our opinion, the objection in regard to the jurisdiction of the arbitrator could not be legitimately raised by the Respondent in the instant case. Here, as already noted in the award itself, the arbitrator mentioned that Ram Swarup had admitted before the arbitrator that he was a member. Further the arbitrator on the basis of the material available to him recorded a finding that Ram Swarup was a member of the society. This is a finding of fact and certainly was not, liable to be questioned in execution proceedings. Whether the judgment-debtor had any remedy by way of a suit or appeal or otherwise is not a matter with which we are concerned in this appeal. We, therefore, hold that the court below had no power to go behind the award and to record a finding that Ram Swarup was not a member of the society. Hence, the decision of the court below that the award was without jurisdiction cannot also be upheld. 6. The learned Counsel for the Respondent raised a point, which does not appear to have been taken in the court below. He, however, submitted that the point does not require any investigation into any question of fact and that being so, he should be permitted to raise it. 6. The learned Counsel for the Respondent raised a point, which does not appear to have been taken in the court below. He, however, submitted that the point does not require any investigation into any question of fact and that being so, he should be permitted to raise it. The point sought to be raised by him is that Under Rule 137(ii) of the Co-operative societies Rules, no application for execution can be legally filed for recovery of money due under an award. His contention was that in cases of award for money the only remedy is to take recourse to Sub-rule (i) to Rule 137. In our opinion, this contention has no force. Rule 197 of the said Rules reads: 137. Awards of arbitrators and decision of an Assistant Registrar or a District Co-operative Officer or the Registrar may be enforced in either of the following ways: (i) On a requisition to the Collector of the district made by the Registrar all; sums recoverable under the award or decision shall be recovered as if they were arrests of land revenue, (ii) On application to the Civil Court having Jurisdiction over the subject matter of the award or decision, that court shall enforce the award or decision as if it were a decree of the Court. In support of the above contention, the learned Counsel (sic) Indu Bhushan v. State of U.P. 1972 AWR 607 decided by a Division Bench of this Court. In that case, however, it petition Under Article 226 of the Constitution was filed by Indu Bhushan questioning the validity of an award under which he was made liable to pay a certain amount to a Co-operative Society. The learned Single Judge dismissed the writ petition. Thereupon a special appeal was filed by Indu Bhushan. This appeal was dismissed by the Division Bench. One of the points, canvassed before Division Bench was that Rule 137 of the Co-operative Societies. Rules, was void and ultra-vires as it violated Article 14 of the Constitution, This, contention was repelled and in repelling this contention, the learned Judges gave several (sic). In Paragraph 7 of the judgment, certain observations were made from which support was sought to be drawn by Shri Gupta, learned Counsel for Ram Swarup, Respondent. Rules, was void and ultra-vires as it violated Article 14 of the Constitution, This, contention was repelled and in repelling this contention, the learned Judges gave several (sic). In Paragraph 7 of the judgment, certain observations were made from which support was sought to be drawn by Shri Gupta, learned Counsel for Ram Swarup, Respondent. The observations in question run thus: further it appears to us that Clause (i) can be invoked for recovery of sums of money that may be recoverable under an award or decision. If an award deals with a matter other than recovery of money that cannot be, enforced Under Clause (i). In this context and in the further context bf the fact that, Under Clause (ii) it is the decree-holder or the person in whose favour the award has been made who can apply to the civil court, it appears that Clause (ii) is confined to the enforcement of that portion; of the award Which does not deal with recovery of sums of money. In case an award is a composite one, it may be said that the decree-holder may make an application to the Civil Court Under Clause (ii) for the enforcement of the award as a whole and that may bring in recovery of n money decree also Under Clause (ii). Even if this interpretation is permissible; it will not involve the vice of discretion. It cannot be said that a discretionary power Has been vested in one individual to adopt one or the other of the two prescribed modes of recovery. The decree-holder can make an application Under Clause (ii). He has no power to requisition under the provisions of Clause (i), for recovery as arrears of land revenue. In either view, Rule 137 does not, in our opinion, violate Article 14 of the Constitution. 7. In our view, there is nothing in the above quoted observations from which it can be argued that the Division Bench in I.B. Gupta's case held as a matter of law that no application for recovery of money under an award can be made Under Clause (ii) of Rule 167. We may point out that Rule 137 itself provides that an award of an arbitrator may be en-forced in either of the two ways mentioned in Clause (i). We may point out that Rule 137 itself provides that an award of an arbitrator may be en-forced in either of the two ways mentioned in Clause (i). It will be noticed that Under Clause (i), no power has been given to the decree-holder, that is to say, a parson in whose favour an award has been made, to make any requisition himself, nor even any right to make an application requiring the Registrar to make (sic) requisition to the Collector. We do not mean to say that it is not open to a decree-holder or a person in whose favour an award has been made to make a request to the Registrar to make a requisition to the Collector, but the decree-holder has not been given any right as such in that behalf. Whereas Under Clause (ii), the decree-holder has been given a specific right of seeking to en-force the award whether for money or for something else by making an application for execution to the competent court. We are, therefore, of the opinion that the above submission of the Respondent is also without force. 8. In the result, the appeal is allowed and the judgment and decree of the court below are set aside. The court below shall proceed with the execution in pursuance of the application made by the decree-holder. In the circumstances of the case, the parties shall bear their own costs throughout.