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1983 DIGILAW 314 (BOM)

Bhandra Zilla Sahakari Shetki Kharedi Vikri Samiti v. Damodar

1983-11-14

PAUNIKAR

body1983
ORDER:- The petitioner (disputant society) has filed this writ petition against the judgment dated 7-10-1976 passed by the Maharashtra State Co-operative Appellate Court in Appeal No. 460 of 1973 arising out of the dispute No. 7 of 1973 decided on 30-4-1973 by Officer on Special Duty, 'nominee of the District Deputy Registrar, Co-operative Societies. 2. The petitioner filed a suit against respondents 1 and 2. It is stated that respondent 1 served with the petitioner as a cashier since 1947. It is stated that respondent 1 defalcated funds of the society to the extent of Rs. 26,302.50 ps. According to the petitioner, respondent I used this amount for his personal purposes. It is stated that this defalcation was detected sometime before 29-6-1971, when respondent 1 disclosed to the office-bearers of the petitioner-society that the actual cash in hand was short by Rs. 26,000/-. It is further stated that respondent 1 defalcated this amount even long before that. However, many times he used to bring amount from his friends and at the time of audit he used to show that cash balance was correct. After the auditor completed audits he used to return the amount to those from whom he brought. It is further stated that lastly it was not possible for him to manage the affairs as aforesaid. It is further stated that the office-bearers of the petitioner-society agreed to take the sale deed of respondent 1's land at the rate of Rs. 5,250/- per acre for the total amount of Rs. 26,302.50 as a repayment of the defalcated amount. After, the sale deed was executed in favour of the petitioner, according to the petitioner, there was an oral agreement between the petitioner and respondent 1 to the effect that respondent 1, would repurchase the lands from the petitioner along with interest at Re. 1/- per cent per month and if he failed to repurchase he would find out some other purchaser for sufficient amount to cover the disputant's claim with interest. It is the case of the petitioner that respondent 1 did not pay this amount within one year as per agreement. Respondent 1 could not manage to sell the land to some other person for realising the amount. The property purchased by the petitioner was under a sale deed executed by respondent i in favour of the petitioner on 29-6-1971. It is the case of the petitioner that respondent 1 did not pay this amount within one year as per agreement. Respondent 1 could not manage to sell the land to some other person for realising the amount. The property purchased by the petitioner was under a sale deed executed by respondent i in favour of the petitioner on 29-6-1971. According to the petitioner, respondent 1 put the petitioner in actual and physical possession of the land sold by respondent 1. Thus, the petitioner was in possession of the land. It is also the case of the petitioner that after the petitioner had taken possession of the land, the petitioner cultivated the land for some years through its servants and reaped the benefits of the property. The petitioner, further states that after sometime respondent I obstructed the petitioner's possession of the land and he was not allowing the petitioner to enjoy the, property conveyed by him to the petitioner under the sale deed. Hence the petitioner filed a dispute before the Registrar, Co-operative Societies, Bhandara under Sections 91 and. 93, Maharashtra Co-operative Societies Act, 1960 (in 'P' Form). The petitioner prayed for a decree against respondents 1 and 2 for confirming the possession of the land in favour of the petitioner and for injunction against respondent 1 restraining him from disturbing the possession of the petitioner. In the alternative, the petitioner (disputant) prayed that in case it is held that the petitioner had lost its possession, then the petitioner should be put in possession of the suit lands. The petitioner also prayed that a decree directing the sale of the disputed land for realising the amount of Rs. 31,204.96 outstanding due from respondent 1 with interest be passed against him and if the sale proceeds of this land, came less than the amount stated above, a decree should be passed against respondent 1 for the amount remaining due and the same should be realised from his other properties. Respondent 2 was joined as a party, because he was a surety of respondent 1 to the extent of Rs. 2,000/-. 3. The respondents filed the written statement and amongst other pleas they mainly contended that the dispute was not maintainable under S.91, Maharashtra Co-operative Societies Act. Respondent 2 was joined as a party, because he was a surety of respondent 1 to the extent of Rs. 2,000/-. 3. The respondents filed the written statement and amongst other pleas they mainly contended that the dispute was not maintainable under S.91, Maharashtra Co-operative Societies Act. In fact according to them, there was no dispute at all and, therefore, they requested that the preliminary issues be framed and the question of jurisdiction be decided as it goes to the very root of the case. They also denied the claim of the petitioner-society on merits. 4. After going through the pleadings of the parties, the learned Officer on Special Duty in Arbitration Case No. 7/1973, vide award dated 30th April, 1973 held that dispute filed by the petitioner against respondents 1 and 2 is not a dispute triable under Section 91, Maharashtra Co-operative Societies Act, and hence the dispute be returned back to the petitioner-society for filing before the appropriate Court. The learned Officer on Special Duty also held that the petitioner in fact recovered the defalcated amount from respondent 1 and so far as the business of the petitioner-society with respondent 1 is concerned, it was not subsisting and the dispute, which is alleged is altogether a different dispute extraneous to the business of the petitioner and would not come within the ambit of dispute touching the business of the society within the, meaning and scope of S.91, Maharashtra Cooperative Societies Act. The learned Officer on Special Duty relied upon ruling reported in AIR 1969 SC 1320 , Deccan Merchants' Co-operative Bank Ltd. v. M/s. Dalichand Jugraj Jain. In this ruling while discussing the question whether the dispute touches the assets of the business of the society, their Lordships of the Supreme Court remarked as follows (at p. 1326) :- "The question arises whether the dispute touching the assets of a society would be a dispute touching the business of a society. This would depend, on the nature of the society and the rules and bye-laws governing it. Ordinarily, if a society owns building and lets out parts of the building which it does not require for its own purposes it cannot be said that letting out of those parts is a part of the business of the society. This would depend, on the nature of the society and the rules and bye-laws governing it. Ordinarily, if a society owns building and lets out parts of the building which it does not require for its own purposes it cannot be said that letting out of those parts is a part of the business of the society. But it may be that it is the business of a society to construct and buy houses and let them out to its members. In that case letting out property may be part of its business." In the instant case it was held that it is not the business of the society to purchase the lands. Consequently, the Officer on Special Duty returned the dispute to the petitioner for presentation to proper Court vide his award dated 30th April, 1973. The petitioner preferred an appeal against the said award to the Maharashtra State Co-operative Appellate Court vide Appeal No. 460 of 1973 and this Appellate Court vide its judgment dated 7-10-1976, dismissed the appeal and confirmed the order passed by the Officer on Special Duty. Both these orders are now challenged in this writ petition by the petitioner. 5. The learned counsel for the petitioner-society Shri Shelat, Advocate contended before me that in view of Explanation to Section 91, the dispute may not be touching to the constitution, election of the office-bearers, the conduct of general meetings, management or business of the society. According to him, there may be any dispute between the society and its servants and any dispute is covered under explanation and hence the Officer on Special Duty has certainly jurisdiction to entertain the dispute filed by the petitioner. It is not possible to accept his submissions. The petitioner's case is that respondent 1 is a cashier of the petitioner and he had defalcated the amount to the extent mentioned by the petitioner, and the petitioner in fact found out a way to recover the defalcated amount and the petitioner took sale deed to the extent of the defalcated amount from respondent 1. Consequently, the amount of the petitioner stands satisfied on taking a sale deed from respondent 1. Consequently, the amount of the petitioner stands satisfied on taking a sale deed from respondent 1. Thereafter the petitioner alleges agreement of reconveyance, disturbance in possession, agreement to sell the suit lands for recovery of the amount of the petitioner, for recovery of any balance left from out of the sale proceeds personally from respondents 1 and 2 and also for injunction. For deciding such an issue, which does not relate to the business of the petitioner, the proper forum would not be a Co-operative Court but a Civil Court. The dispute contemplated under Section 91 is a dispute touching the constitution; election of the office-bearers, conduct of general meeting, the management or the business of the society and the explanation mentioning dispute will obviously mean that such a dispute will be a dispute touching the constitution, election of the office-bearers, conduct of general meeting, management or business of the society. In my opinion the claims mentioned in the sub-clauses have to be touching the constitution, election of the office-bearers, conduct of general meeting, management or business of the society. Relying upon the principles laid down in the aforesaid Supreme Court Ruling, I also hold that the reliefs claimed by the petitioner in dispute to on the basis of the averments in the dispute do not concern the business of the society. It does not obviously come within the ambit of S.91, Explanation 2. Consequently, the findings arrived at by the Officer on Special Duty as well as Maharashtra State Co-operative Appellate Court are perfectly just and legal. The Officer on Special Duty had no jurisdiction to entertain the dispute under S.91, Maharashtra Co-operative Societies Act. Both the orders passed by the Officer on Special Duty and the Appellate Court therefore, deserve to be maintained and need no interference. 6. The petition is without substance and deserves to be dismissed and it is hereby dismissed. The rule is thus discharged with no order as to cots. Petition dismissed.