Managing Director, M. P. State Civil Supplies Corporation Ltd. Bhopal v. Shujalpur Cooperative Marketing and Prog. Society Ltd. Shajapur
2009-10-30
CHAIRMAN, K.C.SHARMA, P.D.MISHRA
body2009
DigiLaw.ai
Judgment ( 1. ) This order shall also govern the disposal of the Second Appeal No. 181/07 (M.P. State Civil Supplies Corporation Ltd., and others v. The Shujalpur Co-operative Marketing and Pro. Society Ltd., Shujalpur and another). ( 2. ) This second appeal u/s. 78 (2) of M.P. Cooperative Societies Act, 1960 (for short the Act) has been preferred by the appellants against the order of Joint Registrar Cooperative Societies, Ujjain passed in Dispute No. 78-189/05-06 dated 8/11/2007. ( 3. ) Brief facts leading to this appeal are such that the appellants are representatives of M.P. State Civil Supplies Corporation Ltd., Bhopal who had a dealing with the respondent No. 1 society about the procurement of wheat on behalf of the appellant Corporation. The appellant had entered into an agreement with the respondent society on 3.4.1998 to purchase wheat on behalf of the appellant at Mandi Sahajapur and to transfer it to Go-downs of FCI through transporter Respondent No. 2. Two trucks of wheat having 290 bags weighing 275 quintal 50 kg handed over on 29.4.1999 were not delivered to the FCI. Costs of which being Rs. 1,59,262.92 was deducted from bills of the respondents No. 1. Respondent No. 1 society filed a dispute u/s 64 before the Deputy Registrar Co-operative Societies, Shajapur, who vide his order dated 30.9.2002 rejected the case of the respondent against which the respondent society filed appeal before the Joint Registrar Co-operative Socieites, Ujjain, who vide order dated 31.8.2004 set aside the order of Deputy Registrar and remanded the matter for first disposal. Deputy Registrar again on 31.9.2005 set aside the claim of the respondent against which another appeal which was filed before the Joint Registrar, who vide the impugned order has allowed the appeal and passed the decree of Rs. 1,59,262.92 along with 15% interest. This appeal is against this order. ( 4. ) Following substantial questions of law were formulated for consideration :- i) Whether in view of the arbitration clause of the agreement the dispute u/s. 64 of the Act was not maintainable. ii) Whether the dispute suffers from the lacuna of not impleading the proper party i.e. Managing Director of the appellant society? iii) Whether the Joint Registrar has erred in not decreeing the claim in respect of two trucks cost of wheat? ( 5.
ii) Whether the dispute suffers from the lacuna of not impleading the proper party i.e. Managing Director of the appellant society? iii) Whether the Joint Registrar has erred in not decreeing the claim in respect of two trucks cost of wheat? ( 5. ) Learned counsel Shri Shobani arguing in favour of the appellant submitted that according to clause No. 2 of the agreement between the appellants and the respondent, the matter should have been referred to Arbitrator appointed by the Registrar and the same should not be heard by the Deputy Registrar u/s. 64. The same question was also raised before Deputy Registrar as well as Joint Registrar and the Joint Registrar has not accordingly interpreted the provision of Arbitration Act and has illegally set aside the order of the Deputy Registrar. Learned counsel in this matter placed reliance on Managing Director Century-Textile Industries Ltd., Mumbai and others v. Manju Gupta and another, 2009 (1) MPWN 72 = 2009 (2) MPLJ 70 in which Honble High Court observed as follows :- (C) Civil Procedure Code, Section - 9, Agreement providing for arbitration in case of any dispute - once it is held that the matter can be determined finally by the arbitrator then the civil Court will be debarred from entertaining the suit of granting the interim injunction. ( 6. ) Learned counsel for the respondent Shri Sanjay Bajpai opposing the plea of the learned counsel for the appellant submitted that according to the Agreement entered into by the two sides, the matter was to be referred to the Registrar. Registrar in the present case is Deputy Registrar Co-operative Socieites, Shajapur who enjoys all necessary powers, according to Scheme of Section 3 of the Co-operative Societies Act. The counsel in support of his arguments placed reliance on the following rulings :- i) Writ Petition No. 994/2005, Shyam Pravanda v. Managing Director (Divisional Forest Officer) M.P. Laghu Van Upaj Sangh Mydt., Union, Satna dated 1.2.2006. ii) Second Appeal No. 32/2005, Dinesh Kumar Jain v. Vanopaj Sahakari Sangh Mydt. and another ( 7. ) The most pertinent point in this context is the provision of Section 8 of the Arbitration and concilation Act, 1996 which reads as under :- ( 8.
ii) Second Appeal No. 32/2005, Dinesh Kumar Jain v. Vanopaj Sahakari Sangh Mydt. and another ( 7. ) The most pertinent point in this context is the provision of Section 8 of the Arbitration and concilation Act, 1996 which reads as under :- ( 8. ) Power to refer parties to arbitration where there is an arbitration agreement :- (1) A judicial authority before which an action is brought in a matter which is the subject to an arbitration agreement shall,if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration. (2) The application referred to in sub-section (1) shall not be entertained unless it is accompanied by the original arbitration agreement of a duly certified copy thereof. (3) Notwithstanding that an application has been made under subsection (1) and that the issue is pending before the judicial authority, an arbitration may be commenced or contiuned and an arbitral award made. 8. It is obvious that the application under the provisions of this Act should have been filed not later man the first statement in the instant dispute. Learned counsel for the appellant submits that he has taken this objection in written statement submitted by him. Honble High Court had dealt on the implication of this phrase for the "first instance" used in the section. The first statement as envisaged in section 8 need not necessarily be the written statement. When the substance of the dispute has been made clear to the opposing party and the party sets down its stand clearly in any proceedings pending action before the judicial authority, then it would amount to first statement. Therefore, dismissal of application under section 8 filed after petitioner had submitted first statement on substance of the dispute is proper. (2001) 3 Mad. LJ 445 (450); (2001) 3 Arbi LR 623. The "first statement on the substance of dispute" can be contained in any interlocutory application or any reply to the interlocutory application. The legislature in its wisdom intended that the first statement was not the "written statement" (2002) 2 Pun LR. 583 (591): (2003) Arb. L.R. 14. The interpretation given by the Honble High Court is fairer understanding of the matter.
The legislature in its wisdom intended that the first statement was not the "written statement" (2002) 2 Pun LR. 583 (591): (2003) Arb. L.R. 14. The interpretation given by the Honble High Court is fairer understanding of the matter. It is clear that although the appellants have submitted that he has taken an objection in the written statement submitted by him on 20.11.2001, however on 25.6.2001, the appellant filed an application under Order 6 Rule 5 of C.P.C. Thus, the written statement is not the first occasion but a later occasion for the appellants to raise the issue about the jurisdiction of the Deputy Registrar. It is clear from the application of the appellant submitted on 25.6.2001 that there are some clarification sought by an application and the appellants did not at all raise the issue that the matter was required to be referred to the Arbitrator as per Agreement of the two sides. ( 9. ) In view of the ultimate explanation given by Honble High Court cited above, we consider the objection raised by the appellants to have been submitted afterwards and thus not in accordance with the provision of Section 8. Moreover this issue has also not been substantially agitated in accordance with the provisions of section 8. In compliance of this provision the submission of the agreement between the two parties was very much required. It was also necessary for the appellant to have agitated this issue before the Trial Court for deciding it first. The above narration of facts adequately imply that the appellants have not availed the opportunity provided to them which they cannot agitate at this stage. The question is therefore answered that the Deputy Registrar and the Joint Registrar have not erred in deciding the matter under the provisions of Co-operative Societies Act. Point No. (ii) ( 10. ) Learned counsel for the appellants further submitted that it is a case of impleading improper parties. The respondent society has proceeded against the Managing Director, Regional Manager and the District Manager in place of the Corporation, which is a body Corporate. The counsel placed his reliance on Jai Pradav Karamchari Kalyan Sangh v. Ayukt Nagar Nigam, Jabalpur, 2005 (3) MPLJ 145 in which Honble High Court has observed that u/s. 97 Civil Procedure Code, the suit is required to be filed against the Corporation.
The counsel placed his reliance on Jai Pradav Karamchari Kalyan Sangh v. Ayukt Nagar Nigam, Jabalpur, 2005 (3) MPLJ 145 in which Honble High Court has observed that u/s. 97 Civil Procedure Code, the suit is required to be filed against the Corporation. Again the counsel for the respondent placed his reliance on the order of Honble High Court in Writ Petition No. 994/ 2005 (Shyam Pravanda v. Managing Director (Divisional Forest Officer, Satna) order dated 1.2.2006 in which Managing Director of M.P. Laghu Van Upaj Sangh Mydt. has been impeladed and the Honble High Court has decided the matter without being concerned with the respondent being a body Corporate. ( 11. ) The counsel for the respondent further submitted that it was a deal directly with the Regional Manager of Civil Supplies Corporation. The Managing Director being Chief Executive of it have been impleaded. The Organization is well represented by the Chief Executive as well as the District and Regional heads. ( 12. ) The counsel for the appellant himself submitted that the citations he relied on is a bit indirect and as Civil Supplies Corporation is comparable with M.P. Municipal Corporation. We would in this connection like to place our reliance on Order XXLX of CPC. Rule 1 wherein it is prescribed that against Corporation, any pleading maybe signed and verified on behalf of the Corporation by the Secretary or by any Director or other principal officer of the Corporation who is able to depose to the facts of the case. In the present case, the Managing Director is the Chief Executive and the Regional Manager and District Manager are at the operational wings. Therefroe, by impleading the respondent there is no case of mis-joinder. The lower Courts considering the matter accordingly have not committed any illegality. ( 13. ) In the light of the above narration of facts, we do not find any merit in the issues agitated by the learned counsel for the appellants. Hence, there are no grounds to interfere in the impugned order dated 8.11.2007 passed by Joint Registrar Co-operative Socieites, Ujjain. Hence, the appeal is dismissed, and the finding recorded by the Jt. Registrar confirmed. Parties to bear their own costs.