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2005 DIGILAW 696 (KAR)

ARECANUT PROCESSING AND SALE CO-OPERATIVE SOCIETY LIMITED v. MOHAMMAD KASIM (DEAD) BY L. RS

2005-10-19

H.L.DATTU, H.N.NAGAMOHAN DAS

body2005
H. L. DATTU, J. ,, J. ( 1 ) THE appellant before us is a Co-operative Society registered under the provisions of the Karnataka Co-operative Societies Act, 1959 (hereinafter for the sake of brevity referred to as "the Act" ). The capital of the Society is primarily contributed by the members those, who have interest in the capital funds of the Society. We have reason to say so, which will be borne out as the judgment proceeds. ( 2 ) RESPONDENT 1 and respondent 2 are the father and the son. During the pendency of the dispute filed by the appellant-Society, respondent 1 expired. With the permission of the Arbitrator, the appellant-Society has impleaded respondents l (a) to l (i) as the legal representatives of deceased respondent 1. ( 3 ) THE deceased respondent 1 and respondent 2 are the growers of arecanut. They are also members of the appellant-Society. For their agricultural operations, they had borrowed certain funds from the appellant-Society, on the security of the arecanut that were being sold through the Society and also on the security of the immoveable properties belonging to them. It is not in dispute nor can it be disputed by them, that they had borrowed loans from the appellant-Society. ( 4 ) SINCE deceased respondent 1 and respondent 2 had defaulted in making payments towards the loan borrowed by them from the Society, the Society had to file a dispute before the Registrar of Co-operative societies as required under Section 70 of the Act, inter alia claiming the principal amount of Rs. 9,51,981. 61 and interest thereon from the date of borrowal till the date of the filing of the dispute. The Competent authority - the Joint Registrar of Co-operative Societies, Bangalore division, Bangalore (hereinafter referred to as 'the Competent authority) after affording an opportunity of hearing to the parties concerned, has passed an award dated 4-4-1995. In the said award, the competent Authority had directed the legal representatives of respondent 1 and respondent 2 herein to pay a sum of Rs. 14,52,000/- with Court costs to the appellant-Society and further, it had directed them to pay interest on a sum of Rs. 9,51,981. 61 at the rate of 21% p. a. from the date of dispute till the date of realisation of the amount awarded in the award. 14,52,000/- with Court costs to the appellant-Society and further, it had directed them to pay interest on a sum of Rs. 9,51,981. 61 at the rate of 21% p. a. from the date of dispute till the date of realisation of the amount awarded in the award. ( 5 ) THE legal representatives of respondent 1 and respondent 2 being aggrieved by the award so passed by the Competent Authority, had filed an appeal before the Karnataka Appellate Tribunal, Bangalore in appeal No. 508 of 1996. The Tribunal has partially modified the award passed by the Competent Authority by its order dated 22-7-1997 reducing the rate of interest awarded by the Competent Authority from 21% to 18%. ( 6 ) THE legal representatives of respondent 1 and respondent 2 being aggrieved by the aforesaid order passed by the Tribunal were before this court in W. P. No. 21033 of 2001. ( 7 ) AT the time of hearing of the writ appeal, we were informed by the learned Counsels for the parties to the Us, that the petition was being adjourned from time to time only to settle the dispute between the parties. That is how, a memo came to be filed by the petitioners (the legal representatives of respondent 1 and respondent 2 herein) in the writ petition which was in the nature of "memo of calculations" calculating the amount payable by them to the appellant-Society. The memo so filed was seriously disputed by the appellant-Society by filing a detailed statement of objections. Apart from contending that the claim made in the memo as incorrect and inappropriate, it had also stated in its statement of objections that respondent 2 had an individual account in the appellant-Society and whatever amount that was paid was towards the said individual account and the same has been adjusted to the said account. Inspite of the serious objection to the memo of calculations filed by the petitioner (the legal representatives of respondent 1 and respondent 2 herein) by the appellant-Society, the learned Single Judge has thought it fit to accept the memo and to modify the award passed by the Competent Authority. Inspite of the serious objection to the memo of calculations filed by the petitioner (the legal representatives of respondent 1 and respondent 2 herein) by the appellant-Society, the learned Single Judge has thought it fit to accept the memo and to modify the award passed by the Competent Authority. While doing so, the learned Single Judge has observed as under:"learned Counsel for the respondent apart from filing objections has not been able to assist the Court with regard to the award passed against the petitioners at Annexure-A. In the objections to the statement of accounts the first respondent-Society has sought to confuse itself by making a reference to another dispute raised against the petitioner in his individual capacity. In this writ petition, I am now only concerned with the award passed at Annexure-A as against the deceased and the petitioners are also legal heirs of the deceased. I am not in this writ petition concerned with the dispute raised against the petitioner in his individual capacity. The law will take its course with respect to the other dispute". ( 8 ) THE appellant-Society being aggrieved by the order passed by the learned Single Judge in the writ petition, is before this Court in the present appeal. ( 9 ) LEARNED Counsel Sri R. V. Jayaprakash, has put forth two-fold contentions before us. Firstly, when the memo of calculations filed by the petitioners (the legal representatives of respondent 1 and respondent 2 herein) in the writ petition was seriously disputed by the appellant-Society, the learned Single Judge ought not to have exercised his jurisdiction under Article 227 of the Constitution of India to modify the award passed by the Competent Authority under the Act. Secondly, it is contended that, if for any reason, the legal representatives of respondent 1 and respondent 2 had paid certain amounts towards the satisfaction of the award passed by the Competent Authority, the same could have been agitated by them in the execution petition that may be filed by the appellant-Society, to execute the award passed by the competent Authority. In aid of his submissions, the learned Counsel invites our attention to sub-section (2) of Section 101 of the Act. ( 10 ) SMT. In aid of his submissions, the learned Counsel invites our attention to sub-section (2) of Section 101 of the Act. ( 10 ) SMT. Namitha Mahesh, learned Counsel appearing for respondent 2 would submit that the learned Single Judge was justified in modifying the award passed by the Competent Authority by accepting the memo of calculations filed by the legal representatives of respondent 1 and respondent 2, since according to the learned Counsel, the same was not seriously disputed by the appellant-Society. ( 11 ) HAVING carefully considered the rival submissions of the learned counsels for the parties to the Us, we are of the view that the learned single Judge was not justified in interfering with the award passed by the Competent Authority under the Act and its confirmation by the karnataka Appellate Tribunal. We say so, for the following reasons: admittedly, the petition was filed under Article 227 of the constitution of India. The High Court can interfere, exercising its power of superintendence under Article 227 of the Constitution, in order to keep the authorities created under a statute to perform quasi-judicial functions within the bounds of their authority and to see that they do their duty in a legal manner. It is also well-settled that for preventing grave and serious miscarriage of justice resulting from following a patently erroneous procedure or contravention of basic principles of justice and fair-play, the supervisory jurisdiction conferred on Courts by article 227 of the Constitution remains available to the Courts. It is also equally well-settled that the power conferred on the Supreme Court under Article 142 of the Constitution to pass any order which is necessary for doing complete justice in any manner, is not available to the High Court. In the present case, an award had been passed by the Competent authority accepting the dispute raised by the appellant-Society. That award is slightly modified by the Tribunal insofar as the levy of interest is concerned from 21% to 18%. That was a subject-matter of contest in the writ petition before this Court. At the time of hearing of the petition, the parties were directed to file their memo of calculations only to resolve the dispute between them. The memo of calculations so filed by the borrowers/respondents was seriously disputed by the appellant- society. That was a subject-matter of contest in the writ petition before this Court. At the time of hearing of the petition, the parties were directed to file their memo of calculations only to resolve the dispute between them. The memo of calculations so filed by the borrowers/respondents was seriously disputed by the appellant- society. To substantiate their stand in the statement of objections filed to the memo of calculations filed by the respondents, sufficient and enough material was produced by the appellant-Society. Inspite of all these, the learned Single Judge could not have proceeded to decide a disputed fact. The learned Single Judge should have allowed the parties to agitate the matter before an appropriate forum. In the name of helping the poor agriculturists, this Court is not expected to cross the limits laid down by the Apex Court while exercising its powers under article 227 of the Constitution. At this stage, we intend to notice the pertinent observations made by the Apex Court in the case of Kerala solvent Extractions Limited v A. Unnikrishnan and Another. 1994-II-LLJ-888 (SC) in the said decision, the Court has observed:"in recent times, there is an increasing evidence of this, perhaps well meant, but wholly unsustainable, tendency towards a denudation of the legitimacy of judicial reasoning and process. The reliefs granted by the Courts must be seen to be logical and tenable within the framework of the law and should not incur and justify the criticism that the jurisdiction of the Courts tends to degenerate into misplaced sympathy, generosity and private benevolence. It is essential to maintain the integrity of legal reasoning and the legitimacy of its conclusions. Expansive judicial mood of mistaken and misplaced compassion at the expense of legitimacy of the process will eventually lead to mutually irreconcilable situations and denude the judical process of its dignity, authority, predictability and respectability". ( 12 ) THE capital funds of the Society primarily belongs to all the members of the Society. All the members are interested in the growth of the Society. A borrower of the funds of the Society has a legal obligation to discharge the loans borrowed and when it is not done, the Society has to take steps to recover the same to safeguard the interest of the members of the Society, who have invested in the capital funds of the society. A borrower of the funds of the Society has a legal obligation to discharge the loans borrowed and when it is not done, the Society has to take steps to recover the same to safeguard the interest of the members of the Society, who have invested in the capital funds of the society. When steps have been taken to recover the dues from the borrower and has culminated in the award passed by the Competent authority and that award is confirmed by a superior forum under the act, this Court in the name of extending its helping hand, cannot deprive the members of the Society, the capital funds invested by them to the capital fund of the Society. ( 13 ) SECTION 101 of the Act provides for execution of the order made by the Registrar either under sub-section (1) of Section 69 or under Section 99 or every decision or award passed under Section 71 of the Act. Sub-section (2) of Section 101 of the Act authorises the Registrar to decide every question relating to the execution, discharge or satisfaction of an order, decision, award, etc. The aforesaid statutory provision would give sufficient opportunity to the judgment-debtor to produce necessary material before the Registrar, if and when an execution petition is filed by the Society for execution of an award to prove that either during the pendency of the award or during the pendency of the appeal, some amount has been paid towards the claim made by the Society. If and when such material is produced by the borrower or the judgment-debtor, it is for the Registrar to verify the same and pass appropriate orders. What requires to be done and ought to have been done by the Registrar has been done by this Court. This, in our opinion, is again impermissible. In view of the above, we find it extremely difficult to sustain a sympathetic order passed by the learned Single Judge. Therefore, the order requires to be set aside. ( 14 ) IN the result, the following.-"i. The appeal is allowed; ii. The impugned order passed by the learned Single Judge in w. P. No. 21033 of 2001, dated 1-9-2003 is set aside; iii. Therefore, the order requires to be set aside. ( 14 ) IN the result, the following.-"i. The appeal is allowed; ii. The impugned order passed by the learned Single Judge in w. P. No. 21033 of 2001, dated 1-9-2003 is set aside; iii. Liberty is reserved to the legal representatives of respondent 1 and respondent 2 to produce such material which is available to them, if the when an execution petition is filed by the appellant-Society for executing the award passed by the Competent Authority in Dispute No. 429 of 1990-91; iv. Liberty is also reserved to the legal representatives of respondent 1 and respondent 2 to take up all such contentions, which are available to them including some of the contentions raised in the writ petition; v. No order as to costs. Ordered accordingly. " --- *** --- .