In re : Bankura Wholesale Consumers Co-operative Society Ltd. v. West Bengal Essential Commodities Supply Corporation Ltd.
1991-03-20
MANABENDRA NATH ROY, Monoranjan Mallick
body1991
DigiLaw.ai
JUDGMENT : - M.R. Mallick, J.: In this application under Article 227 of the Constitution the judgment and order dated 30th November, 1990 passed by the Member. West Bengal Co-operative Tribunal in Appeal No 43/88 affirming that the judgment and order dated. 30th September, 1988 passed by the Assistant Registrar of Co-operative Society, Bankura and the Arbitrator in the Dispute Case no. 1988-89 filed by the present petitioner before him under the provision of s. 95 of the West Bengal Co-operative Societies Act of 1983 have been challenged. The facts may be briefly stated as follows :- 2. The Chief Executive Officer, Bankura a Wholesale Consumers Co-operative Society Limited, Post & District Bankura bas filed a dispute case on 27.8.88 against the opposite party for an Award for realisation of the claim amounting to Rs. 22,87,332.72 The Assistant Registrar of Co-operative Society Bankura refused to entertain the said dispute-firstly on the ground that in view of the specific agreement executed by the plaintiff Society from time to time with the West Bengal Essential Commodities Supply Corpn. Ltd. (hereinafter referred to as The Corporation) there is no scope to entertain the plaints of the dispute for Arbitration and secondly, on the ground that the plaintiff has straight-way prayed for an Award of Rs. 22,87.332 72 against the Corporation without any reference and prayer thereof in the plaint for declaring the agreement null and void. The Assistant Registrar of the Co-operative Society, Bankura in the circumstances, has rejected the plaint under rule 171 (2) of the West Bengal Co-operative Societies Rules 1987 (hereinafter referred to as the said Rules). 3. Being aggrieved the present petitioner preferred appeal before the Member, West Bengal Co-operative Tribunal belong Appeal No. 43/88. The learned Tribunal has also dismissed the appeal and affirmed the order passed by the Assistant Registrar of Co-operative Societies Bankura. Being aggrieved the present petition under Article 227 of the Constitution has been filed. 4. It is submitted that the dispute raised by the petitioner by filing a plaint before the Assistant Registrar, Co-operative Societies Bankura is a dispute which is entertain able by him under the provision of s. 95 of the West Bengal Co-operative Societies Act, 1983, that the jurisdiction of the Civil Court has been expressly barred and such dispute which squarely comes within the purview of s. 95 of the West Bengal Co-operative Societies Act.
1983 Cannot be rejected by the Assistant Registrar of the Co-operative Society in limine. It is also submitted that even though the agreement entered into between the petitioner and the opposite party-Corporation contains an Arbitration Clause but that Arbitration Clause cannot be given effect to in view of the specific bar contained in the West Bengal Co-operative Societies Act, 1983 and the learned Appellate Tribunal has also committed an error of jurisdiction by affirming the order passed by the Assistant Registrar of Co-operative Societies. The opposite party-Corporation has contested the Revision Petition even though no affidavit-in-opposition has been filed. It is submitted that the agreement entered into between the petitioner and the Corporation, which has been renewed from time to time has been acted upon and cannot now be declared as void and consequently the learned Assistant Registrar rightly rejected the plaint and the learned Appellate Tribunal did not commit any illegality in confirming the order of the Assistant Registrar of Co-operative Society, Bankura. 5. We find that a dispute praying for an Award of money claim has been preferred by way of a plaint by the present petitioner before the Assistant Registrar of Co-operative Societies Bankura 6. It is urged on behalf of the petitioner that the petitioner-Society is a Consumers' Co-operative Society and deals with all kinds of consumer goods, that the Corporation entered into an agreement in question which has been renewed from time to time appointing the present petitioner as the handling agent of the Corporation under the terms and conditions of the agreement which has been renewed from time to time. As the dispute over the petitioner's monetary claim has arisen in connection with such activity of the present petitioner acting as the handling agent of the opposite party Corporation, then such dispute comes within the purview of s. 95 of the W.B. Co-operative Societies Act, 1983. It is also pointed out that in view of Clause (d) of s. 95 of the Act such dispute has to be settled by Arbitration in terms of s. 95 and the jurisdiction of the Civil Court has consequently been excluded.
It is also pointed out that in view of Clause (d) of s. 95 of the Act such dispute has to be settled by Arbitration in terms of s. 95 and the jurisdiction of the Civil Court has consequently been excluded. It is also urged that the Arbitration Clause in the agreement has also become inoperative because of this statutory Arbitration provided under the W.B. Co-operative Societies Act and the General Provision of Arbitration Act, 1940 shall not be attracted to such statutory Arbitration and in that view the Arbitration Clause contained in the agreement has become inoperative and the parties have to adjudicate the dispute even in respect of the said agreement through provision of the statutory arbitration contained in s.95 of the W.B. Co-operative Societies Act. 7. On considering the provision of s. 95 of the Act we are of the view that it cannot but be held that the dispute for which the petitioner has filed the plaint before the Assistant Registrar of Co-operative Society is a dispute concerning the business of a Co-operative Society and also a dispute relating to the affairs of the Co-operative Society. In view of Clause (d) of sub-so (1) of S. 95 of the Act such dispute shall have to be referred in the prescribed manner to the Registrar if the dispute is between a Co-operative Society and "any person". A Special Bench of our High Court in Anjan Choudhury v. Ananda Neer Co-operative Registered Housing Society & Ors. 1990(1) CHN 404 has observed as follows :"........................the "dispute", in order to come within the provisions of s. 86 of the Old Act and s. 95 of the New Act and thus to go out of the jurisdiction of the Civil Courts under the provisions of s. 132 of the Old and S. 134 of the New Act, must be disputes, not just concerning or involving a Co-operative Society, but concerning the business or relating to the affairs of the Society, such business or affairs which the Society is authorised to be concerned with or be involved in order to carry out its objectives under the Act and as chartered by any in its Rules and By laws." 8. The petitioner Society is a Consumers Society and deals with various kinds of consumers goods.
The petitioner Society is a Consumers Society and deals with various kinds of consumers goods. Therefore, it was within the ordinary business of the petitioner Society that the agreement had been entered into with the opposite party Corporation to act as there handling agent for distribution of cement to the consumers of the District of Bankura. As the present petitioner has filed the plaint preferring claim against the opposite party-Corporation for an award of money claim for acting as such handling agent of the opposite party-Corporation then the dispute raised is a dispute which has to be governed by the Statutory Arbitration Clause provided in s. 95 of the W.B. Co-operative Societies Act. Section 46 of the Arbitration Act, 1940 provides as follows :- S. 46-Application of Act to Statutory Arbitration -The provision of this Act except sub-sec. (1) of sec. 6 and ss. 7, 12,26 and 37 shall apply to every Arbitration under any other enactment for the time being in force as if the Arbitrations were pursuant to an Arbitration agreement and as if that other enactments were on Arbitration agreement except in so far as this Act is inconsistent with that other enactment or with any Rules made thereunder." 9. There are several decisions under the different State Co-operative Societies Acts of different State Acts in which similar provisions of statutory Arbitration are contained in various State Co-operative Societies Act in which it has been held that the provision of the said Acts have superseded to the extent that they are inconsistent with the provisions of the General Provisions of Arbitration Act, 1940 Reference may be made to the Full Bench decision of Delhi High Court in Refugee Co-operative Housing Society Limited Vs. Harban Singh, reported in A.I.R 1982 Delhi 335 (FB) ; Harchand vs. K.K. Agricultural Co-operative Society Limited A.I.R. 1983 Punjab & Haryana 19, A.I.R. 1979 H.P. I, AIR 1955 Madras 694. In AIR 1955 Madras 694 the Division Bench of Madras High Court has held that the provision regarding the statutory Arbitration of the Madras Co-operative Societies Act will be attracted only if the dispute is touching to the business of the Society. Therefore, we are satisfied that when there is a statutory Arbitration provided in the W.B. Co-operative Societies Act.
In AIR 1955 Madras 694 the Division Bench of Madras High Court has held that the provision regarding the statutory Arbitration of the Madras Co-operative Societies Act will be attracted only if the dispute is touching to the business of the Society. Therefore, we are satisfied that when there is a statutory Arbitration provided in the W.B. Co-operative Societies Act. 1983 in s. 95, the general provision of the Arbitration Act so far as the same are inconsistent with the said provision of statutory Arbitration will not be attracted. We find that in the agreement entered into between the parties there is an Arbitration Clause 29 wherein it has been provided as follows :- All disputes and differences arising out of or in any way touching or concerning this Agreement whatsoever (except as to any matter the decision of which is expressly provided for in the Agreement) shall be referred to the sole arbitration of any person appointed by the Corporation. It will be no ground for objection to any such appointment that the person appointed is or was an employee of the Corporation, that he had no deal with the matters to which the Agreement relates. The award of such arbitrator shall be final and binding on the parties to this Agreement. It is a term of this Agreement that in the event of such Arbitrator to whom the matter is referred being transferred or vacating his office or being unable to act for any reason, the Corporation at the time of such transfer, vacation of office or inability to act, shall have the liberty to appoint another person to act as Arbitrator. Such persons shall be entitled to proceed with the reference from the stage at which it was left by his predecessor. It is also a term of this Agreement that no person other than a person appointed as aforesaid should act as Arbitrator. Provided further that any demand for arbitration in respect of any claim(s) from the Agent under the Agreement, shall be in writing and made Within one year of termination or completion (expiry of the period) of the Agreement and where such demand is not made within that period the claim(s) of the Agent shall be deemed to have been waived and absolutely barred and the Corporation shall be discharged and released of all liabilities under the Agreement in respect of these claims.
........................Arbitration Act, 1940, shall apply to the Arbitration proceedings under this clause. Work under the Agreement shall, if reasonably possible, continue during the Arbitration proceedings and no payment due to or payable by the Corporation shall be withheld on account of such proceedings.". 10. The Arbitration Clause provided in Cl. 29 of the Agreement is an Arbitration Clause to which all the provisions of Arbitration Act will be attracted. But when the dispute of the present nature is required to be adjudicated only by taking recourse to the provision of the statutory Arbitration contained in s. 95 of W.B. Co-operative Societies Act, 1983 then we are satisfied that even if the agreement which has been extended from time to time may be treated as a valid agreement, the dispute of the petitioner for money claim for working as a handling agent of the Corporation in terms of the agreement have to be adjudicated by the above statutory Arbitration procedure contained in the Act On behalf of the opposite party it is submitted that if it be held that the Arbitration Clause is invalid or inoperative then the whole agreement becomes non est and the petitioner cannot have any claim against the opposite party-Corporation for acting as handling agent under the said agreement. We are unable to accept the above submission of the learned Advocate for the opposite party. It is true that if the main agreement is held to be void and non est the Arbitration Clause contained therein also perishes with it. But it is not the law that if a particular Clause of the agreement is rendered inoperative because of some statutory bar created by the W.B. Co-operative Societies Act, 1983 then the whole agreement will have to be held as void and non est. In our view the petitioner may still have his claim on the agreement for working as handling agent even if the Arbitration Clause is declared by us to be inoperative. 11. We find that the Assistant Registrar of Co-operative Societies has rejected the plaint also on the ground that no declaration is sought for declaring the agreement void and he has, therefore, rejected the plaint under Rule 171(2). 12. We have carefully considered Rule 171 of the W.B. Co-operative Societies Rules, 1987.
11. We find that the Assistant Registrar of Co-operative Societies has rejected the plaint also on the ground that no declaration is sought for declaring the agreement void and he has, therefore, rejected the plaint under Rule 171(2). 12. We have carefully considered Rule 171 of the W.B. Co-operative Societies Rules, 1987. It appears that the Assistant Registrar, Co-operative Societies has rejected the plaint on one of the grounds that no declaration is sought for that the agreement is void. 13. It is submitted on behalf of the petitioner that the petitioner has not wholly disowned the agreement and there is no intention of the petitioner to claim that whole agreement is rendered void. Moreover, it is submitted that the relief prayed for as is provided in s. 171(1)(c) and the statement of the subject of dispute as contained in Clause (b) of Sub-Rule (1) of Rule 171 of the Rules have been given in the plaint. Therefore, only because such a declaration has not been sought for the Assistant Registrar should not have rejected the plaint. 14. We are of the view that the Assistant Registrar, Co-operative Societies should not have rejected the plaint on the ground which he did. The learned Tribunal also committed an error of jurisdiction in affirming such order. The dispute which is a money claim of the petitioner raised against the opposite party Corporation is a dispute which is required adjudication under the machinery provided by s. 95 of the W.B. Co-operative Societies Act and the concerned Assistant Registrar has to decide the said dispute on merits. The plaint submitted in such dispute shall not be treated with same kind of technicality which is to be treated in respect of a plaint filed under the C.P.C. Moreover, if the Assistant Registrar was of the opinion that the petitioner had to pray for the necessary declaration for him to entertain the claim he ought to have given the petitioner such opportunity to amend the plaint but without doing that he cannot straightway reject the plaint on the ground that the relief for declaration that the agreement is void has not been sought for in the plaint. Therefore, in any view of the matter the rejection of the plaint by the Assistant Registrar is absolutely illegal and affirmation of such order of the learned Co-operative Tribunal is also illegal and without jurisdiction.
Therefore, in any view of the matter the rejection of the plaint by the Assistant Registrar is absolutely illegal and affirmation of such order of the learned Co-operative Tribunal is also illegal and without jurisdiction. Both the orders are hereby quashed. The learned, Assistant Registrar, Co-operative Societies shall new proceed with the plaint filed by the present petitioner in accordance with law to decide the dispute on merits. Order impugned quashed; direction given to proceed with the plaint.