Kallappa Anna Patil v. Maharashtra Co-op. Engg. Scy. Ltd. & another
2000-07-17
A.M.KHANWILKAR
body2000
DigiLaw.ai
JUDGMENT - A.M. KHANWILKAR, J.:---This writ petition under Article 227 of the Constitution of India is directed against the judgment and order passed by the Maharashtra State Co-operative Appellate Court, Bombay in Appeal No. 318 of 1996 dated 24-10-1986. 2. Respondent No. 1 original disputant is engaged in manufacturing of Oil Engine, Power Tiller, Electric Motor and other engineering goods. Respondent No. 2 is the sole distributor of the goods manufactured by respondent No. 1 society. The petitioner is the proprietor of firm M/s. Gajraj Agro Sales Corporation. The petitioner is a sub dealer of the respondent No. 2 company. 3. Briefly stated, the respondent No. 1 society filed dispute for recovery of amount of Rs. 23,882/- along with interest thereon. The said claim was on the basis of the transaction entered into with regard to the sale of power tiller of the respondent No. 1 Society in favour of Mr. Kulkarni on the request made by the petitioner. 4. It is stated by the respondent No. 1 that the petitioner approached the respondent No. 1 as a sub dealer of the respondent No. 2 and placed an order for his customer on 17-4-1976. A bearer cheque was made over to the respondent No. 1 towards the price of the tiller for an amount of Rs. 23,686-70 drawn in the name of M/s. Greeves Cotton Co. (respondent No. 2). The goods were delivered to the said customer introduced by the petitioner on the same day. It is stated that petitioner had assured that demand draft for the like amount would be sent within 4 days, however, the petitioner did not send the demand draft on account of which respondent No. 1 submitted the said bearer cheque to the respondent No. 2 company for realisation, who in turn had issued Hundis for sum of Rs. 20,087-41 excluding commission payable to the respondent No. 2 company. It is not in dispute that the Hundi issued by the respondent No. 2 company was honoured and respondent No. 1 received the amount which was due and payable. However, when the respondent No. 2 company presented the bearer cheque issued by the petitioner, the same was returned with remarks that the payment was stopped by the drawer. Consequently, the respondent No. 2 company debited the amount of Rs.
However, when the respondent No. 2 company presented the bearer cheque issued by the petitioner, the same was returned with remarks that the payment was stopped by the drawer. Consequently, the respondent No. 2 company debited the amount of Rs. 23,882-70 from the account of respondent No. 1 as the said cheque was dishonoured and the amount was already paid by the respondent No. 2 to the respondent No. 1 society. The respondent No. 1 took objection to the debiting of the amount from their account contending that it was the responsibility of the respondent No. 2 company to recover the amount of goods sold to the customer at the instance of the petitioner who was its sub dealer. Eventually, the respondent No. 1 filed dispute before the Co-operative Court under section 91, both against the respondent No. 2 as well as the petitioner, for recovery of the said amount along with interest. The matter was contested before the Co-operative Court No. 2, Kolhapur and Sindhudurga Districts by the rival parties. The Co-operative Court by its order dated 30-5-1986 allowed the dispute preferred by the respondent No. 1. The Co-operative Court held that the respondent No. 1 society shall first make an attempt to recover the amount with costs and interest thereon from the petitioner herein and in case the petitioner fails to pay the amount the same shall be recovered from the respondent No. 2 Company herein. 5. Being aggrieved by the order passed by the Co-operative Court the petitioner as well as respondent No. 2 preferred an appeal before the Maharashtra State Co-operative Appellate Court, Bombay. The Maharashtra State Co-operative Appellate Court by its common judgment and order dated 24-10-1996 was pleased to dispose of both the appeals. In so far as Appeal preferred by respondent No. 2, the Appellate Court conclusively held that from the facts established on record it cannot be said that the respondent No. 2 was liable to pay the amount for the goods delivered by the respondent No. 1. Society without intimation and against its instructions. In the circumstances the Appellate Court in effect held that the dispute as filed against the respondent No. 2 was not maintainable. Accordingly, the Appellate Court allowed the appeal preferred by the respondent No. 2 company.
Society without intimation and against its instructions. In the circumstances the Appellate Court in effect held that the dispute as filed against the respondent No. 2 was not maintainable. Accordingly, the Appellate Court allowed the appeal preferred by the respondent No. 2 company. On the other hand, with regard to the appeal preferred by the petitioner, the Appellate Court decided the same on merits and held that the petitioner was liable to pay disputant's claim in dispute. In so far as the objection raised by the petitioner with regard to the maintainability of the dispute against him, the Appellate Court held that the dispute could be maintained even against the petitioner since the petitioner was the sub dealer of the respondent No. 2 company. The Appellate Court referred to section 94, sub section (3) of the Act to hold that the dispute filed against the petitioner is maintainable. Accordingly the Appellate Court dismissed the appeal preferred by the petitioner and confirmed the award passed by the Co-operative Court. 6. The petitioner has filed the present writ petition under Article 227 of the Constitution of India thereby challenging the aforesaid decision of the Appellate Court. The short question on which the petition should succeed, submits the petitioner, is whether the Appeal Court having held that the dispute filed against the respondent No. 2 company was not maintainable, for the reasons which have been recorded in paras 7 and 8 of its judgment, therefore, as a necessary corollary the dispute filed against the petitioner in his capacity as sub dealer of the respondent No. 2 should also fail. The Appellate Court has recorded a clear finding that there is no privity of contract between the respondent No. 1 and respondent No. 2 with regard to the transaction in question and in fact the goods were supplied by the respondent No. 1 society without intimation to the respondent No. 2 and contrary to the instructions of respondent No. 2. Having recorded this finding the Appellate Court has rightly concluded that the dispute instituted against the respondent No. 2 was not maintainable. The next question that will have to be considered is whether dispute simplicitor against the petitioner only being sub dealer of the member of the Society, could be maintained. For maintaining a dispute, the prerequisite is that the dispute should touch the constitution, management or business of a society.
The next question that will have to be considered is whether dispute simplicitor against the petitioner only being sub dealer of the member of the Society, could be maintained. For maintaining a dispute, the prerequisite is that the dispute should touch the constitution, management or business of a society. Section 91 also postulates that -to such a dispute, there shall be necessarily from both the parties thereto, one or the other of the following viz. the society, agent and such other person including person claiming through a member. The said provision expressly provides that both the parties or one or the other of the parties to the dispute shall be none else than the one provided under Clauses (a) to (e) of sub section (1). The sub dealer of member does not fit in any of the categories of persons described in the said clauses. The learned Counsel for the respondent No. 1 relied upon Clause (a) to contend that any past or present agent is a wide expression to encompass even a sub-dealer. I am afraid, this contention cannot be accepted for the simple reason that Clause (a) is referable to the party being a society and anyone claiming through the Society viz. its committee, present or past officer in past or present agent, in past or present servant or nominee etc. The expression of past or present agent referred to in the said Clause is past and present agent of the Society. In the circumstances a dispute could be maintained against the petitioner only if a dispute was maintainable against the respondent No. 2, who was the member of the respondent No. 1 society and such a dispute could be only in respect of the business of the society. Since the Appellate Court has recorded a clear finding that there was no privity of contract between the respondent No. 2 and the respondent No. 1 in respect of the transaction in question, naturally no dispute could be maintained against the petitioner simplicitor for recovery of the amount on the basis of such transaction. Reference to sub section (3) of section 94 made by the Appellate Court, in my view, is totally misdirected. Section 94 sub-section (3) cannot enlarge the scope of the provisions of section 91 of the Act.
Reference to sub section (3) of section 94 made by the Appellate Court, in my view, is totally misdirected. Section 94 sub-section (3) cannot enlarge the scope of the provisions of section 91 of the Act. Moreover, sub section (3) would apply in respect of a person whether he may be a member of the society or not but has acquired interest in the property of a person who is a party to the dispute. In the present case, it cannot be said that the provisions will have any application unless it is shown that the respondent No. 2 company was concerned with the transaction in question and was liable to be sued under the said provisions. 7. For the aforesaid reasons, since no dispute under section 91 of the Act was maintainable against the petitioner for the recovery of the amount in respect of transaction in question, it would be impermissible to adjudicate the merits of contention with regard to the liability of the petitioner. The writ petition would therefore succeed on the short ground that the dispute as filed against the petitioner was not maintainable under section 91 of the said Act. 8. In the circumstances, the orders passed by the Co-operative Court as well the Appellate Court will have to be quashed and set aside. For the reasons aforesaid the writ petition is allowed with no order as to costs. Needless to mention that it will be open for the respondent No. 1 to take out appropriate proceedings which are permissible in law. It is further ordered that if the petitioner has paid or deposited any amount for satisfaction of the Award passed by the Co-operative Court the same shall be refunded to the petitioner without any interest within a period of 4 weeks. Writ petition is allowed with no order as to costs. Rule made absolute. The order passed by the Co-operative Appellate Court dated 24-10-1986 in Appeal No. 336 of 1986 and award passed by the Co-operative Court, Kolhapur and Sindhudurga Districts dated 30-5-1986 in Dispute No. 222 of 1977 is quashed and set aside. Certified copy expedited. Parties to act on the copy of the order duly authenticated by Sheristedar of this Court. Writ petition allowed. -----