JOHN MATHEW, S/O. MATHEW v. ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES(GENERAL)
2018-05-21
ANIL K.NARENDRAN
body2018
DigiLaw.ai
JUDGMENT : The petitioner who availed an agricultural loan for Rs.25,000/-from the 4th respondent Co-operative Bank on the strength of Ext.P1 Gahan No.2836/1995 of the Sub Registrar Office, Adoor dated 18.8.1995 creating mortgage over his property having an extent of 15.6 areas (37 cents) in re-survey No.435/9 of Peringanad Village has approached this Court in this writ petition under Article 226 of the Constitution of India, seeking a writ of certiorari to quash Ext.P6 award of the 2nd respondent Arbitrator dated 25.03.2015 in A.R.C.No.434/2012, Ext.P8 judgment of the Co-operative Tribunal dated 31.07.2015 in Appeal No.54/2015 and Ext.P9 demand notice of the 3rd respondent Special Sale Officer dated 24.07.2017. The petitioner has also sought for a declaration that the liability incurred by him towards the 4th respondent Co-operative Bank, pursuant to Ext.P2 loan application dated 09.01.2003, is not liable to be recovered, being time barred and a writ of mandamus commanding the 3rd respondent Special Sale Officer to forbear from any recovery steps against the petitioner pursuant to Exts.P6, P8 and P9. 2. On 28.07.2017, when this writ petition came up for admission, this Court issued urgent notice by speed post to respondents 2 to 4. The learned Government Pleader took notice for the 1st respondent. 3. Heard the learned counsel for the petitioner, the learned Government Pleader appearing for respondents 1 to 3 and also the learned counsel for the 4th respondent Co-operative Bank. 4. The sole contention raised by the learned counsel for the petitioner is that, the liability incurred by the petitioner towards the 4th respondent Co-operative Bank, pursuant to Ext.P2 loan application dated 09.01.2003, was time barred as on the date of filing of Ext.P4 claim in A.R.C.No.434/2012 before the 2nd respondent Arbitrator under Section 69 of the Kerala Cooperative Societies Act, 1969 and as such, Ext.P6 award of the Arbitrator, Ext.P8 judgment of the Co-operative Tribunal and Ext.P9 demand notice of the 3rd respondent Special Sale Officer are liable to be set aside. 5. On 18.08.1995, the petitioner availed an agricultural loan for Rs.25,000/-from the 4th respondent Co-operative Bank after executing Ext.P1 Gahan No.2836/1995 of the Sub Registrar Office, Adoor dated 18.8.1995, creating mortgage over his property having an extent of 15.6 areas (37 cents) in re-survey No.435/9 of Peringanad Village.
5. On 18.08.1995, the petitioner availed an agricultural loan for Rs.25,000/-from the 4th respondent Co-operative Bank after executing Ext.P1 Gahan No.2836/1995 of the Sub Registrar Office, Adoor dated 18.8.1995, creating mortgage over his property having an extent of 15.6 areas (37 cents) in re-survey No.435/9 of Peringanad Village. Clauses 1 to 7 of Ext.P1 Gehan would show that it is a continuing guarantee for availing loans, on executing venkadapathrams from time to time, up to a total sum of Rs.25,000/-, and Ext.P1 Gehan shall continue to be in force till the petitioner repays the entire amount due to the 4th respondent Co-operative Society, under such venkadapathrams executed from time to time. After repaying the agricultural loan availed on 18.08.1995, the petitioner availed another loan for Rs.25,000/-from the 4th respondent Co-operative Bank, on 09.01.2003, based on Ext.P2 loan application dated 09.01.2003, after executing Ext.P3 venkadapathram dated 09.01.2003, agreeing to repay the loan amount together with 15% interest over a period of two years. Ext.P2 loan application would show that, the petitioner was sanctioned with the second loan for Rs.25,000/-on the strength of the continuing security offered in Ext.P1 Gahan. 6. As the petitioner did not repay the agricultural loan availed on 09.01.2003, the 4th respondent Co-operative Bank filed A.R.C.No.434/2012 before the 1st respondent Assistant Registrar of Co-operative Societies, which was made over to the 2nd respondent Arbitrator for disposal. Ext.P4 is the claim dated 15.05.2012 in A.R.C.No.434/2012 for recovery of a total sum of Rs.70,284/-. On receipt of notice in A.R.C.No.434/2012, the petitioner filed Ext.P5 objection dated 14.3.2013, essentially contending that the claim is time barred, either based on Ext.P1 Gahan or Ext.P3 venkadapathram. According to the petitioner, the loan amount would become time barred after the lapse of three years from the date of Ext.P3 venkadapathram or at least on 19.08.2007 when 12 years' charge created under Ext.P1 Gahan would expire, since there was no acknowledgment of the debt or part payment. 7. The 2nd respondent Arbitrator passed Ext.P6 award dated 25.03.2015, whereby A.R.C.No.434/2012 stands disposed of by directing the petitioner to pay the 4th respondent Cooperative Bank a sum of Rs.70,284/-with interest at the rate of 13% per annum from 16.5.2012 and cost. As per the award, the 4th respondent Co-operative Bank is permitted to realise the said amount by enforcing the charge created on the petitioner's property under Ext.P1 Gahan dated 18.08.1995. 8.
As per the award, the 4th respondent Co-operative Bank is permitted to realise the said amount by enforcing the charge created on the petitioner's property under Ext.P1 Gahan dated 18.08.1995. 8. Challenging Ext.P6 award, the petitioner filed Ext.P7 appeal before the Co-operative Tribunal under Section 82(1)(e) of the Kerala Co-operative Societies Act, 1969 read with Rule 98 of the Kerala Co-operative Societies Rules, 1969. In the appeal, the petitioner contended that the claim in A.R.C.No.434/2012 was time barred, and that the rate of interest awarded by the 2nd respondent Arbitrator in Ext.P6 award is exorbitant, and that there are procedural lapses on the part of the Arbitrator while passing the award leading to violation of principles of natural justice and fairness. 9. The Co-operative Tribunal by Ext.P8 judgment dated 31.08.2015 set aside Ext.P6 award in part, thereby modifying the said award as one allowing the 4th respondent Co-operative Bank to realise a sum of Rs.25,000/-together with interest at 13% per annum from 09.01.2003 till filing of A.R.C.No.434/2012 and thereafter, at 13% for the above amount till realisation of the entire amount from the petitioner and his assets, including the property scheduled, and cost of A.R.C. proceedings. In Ext.P8 judgment, the Co-operative Tribunal repelled the contention raised by the petitioner that the claim in A.R.C.No.434/2012 is barred by limitation, by holding that the provisions under the Limitation Act, 1963 have no application to the proceedings before the Arbitrator under the Kerala Co-operative Societies Act, which is a self contained code. The Tribunal found that, as on the date of filing of A.R.C.No.434/2012, no time limit was fixed for filing claim before the Arbitrator. By the Kerala Co-operative Societies (Amendment) Act, 2013 time limit was fixed for filing monetary disputes before the Arbitrator. The said amendment has no retrospective application. As per the general principles of law, the question of law regarding limitation in filing a case has to be decided on the basis of the law as on the date of filing of the case, and not based on the law applicable as on the date of disposal of the case. Therefore, the Tribunal rejected the contention of the petitioner herein that the claim in A.R.C.No.434/2012 is barred by limitation. 10.
Therefore, the Tribunal rejected the contention of the petitioner herein that the claim in A.R.C.No.434/2012 is barred by limitation. 10. The sole ground raised in this writ petition is that the claim in A.R.C.No.434/2012 is barred by limitation as on the date of filing of Ext.P4 claim and as such, Ext.P6 award of the 2nd respondent Arbitrator, Ext.P8 judgment of the Co-operative Tribunal and Ext.P9 demand notice of the 3rd respondent Special Sale Officer are liable to be set aside. 11. Chapter IX of the Kerala Co-operative Societies Act, 1969 deals with settlement of disputes. As per Section 69(1) of the said Act, a monetary dispute between the society and a member of that society shall be referred to the Registrar. The Registrar shall decide such dispute and no other court or authority shall have jurisdiction to entertain any suit or other proceedings in respect of such dispute. Section 69 of the said Act is in pari materia with Section 60 of the Travancore-Cochin Cooperative Societies Act, 1951 (Act 10 of 1952). 12. In Thilakan v. Mankai Coir Vyavasaya Cooperative Society Ltd. [ 1978 KLT 256 ], the question that came up for consideration before a Division Bench of this Court was as to whether the provisions of the Limitation Act, 1963 are applicable in the matter of adjudication of a claim preferred before the Registrar of Co-operative Societies under Section 60 of the Travancore Cochin Co-operative Societies Act, 1952, which is pari materia to Section 69 of the Kerala Co-operative Societies Act, 1969. The Kerala Co-operative Tribunal by its order held that the provisions in the Limitation Act have no application to proceedings taken before the Registrar under Section 69 of the Kerala Act (Section 60 of the TC Act). The said order of the Cooperative Tribunal was under challenge in O.P.No.2879 of 1972. The learned Single Judge dismissed the writ petition holding that the Tribunal was right in rejecting the plea of limitation on the ground that the Limitation Act has no application to the proceedings before the Registrar. The said judgment was under challenge in W.A.No.379 of 1974.
The said order of the Cooperative Tribunal was under challenge in O.P.No.2879 of 1972. The learned Single Judge dismissed the writ petition holding that the Tribunal was right in rejecting the plea of limitation on the ground that the Limitation Act has no application to the proceedings before the Registrar. The said judgment was under challenge in W.A.No.379 of 1974. After referring to the judgment of the Apex Court in Town Municipal Council, Athani v. Presiding Officer, Labour Court, Hubli [ (1969) 1 SCC 873 ] and Rama Rao v. Narayan [ (1969) 1 SCC 167 ] the Division Bench agreed with the view taken by the learned Single Judge that the Assistant Registrar not being a court governed by the provisions of the Code of Civil Procedure, 1908, the provisions of the Limitation Act, 1963 have no application to the adjudication conducted by him under Section 69 of the Kerala Act (Section 60 of the TC Act). 13. In Rama Rao's case (supra), a decision relied on by the Division Bench of this Court in Thilakan's case (supra), the question that came up for consideration before the Apex Court was as to whether the nominee of the Registrar appointed under Section 92 of the Maharashtra Co-operative Societies Act, 1960 is a court within the meaning of Section 195 of the Criminal Procedure Code, 1973. Answering the question in the negative, it was held by the Apex Court that, even though the nominee of the Registrar is required to act judicially, i.e., fairly and impartially, the obligation to act judicially does not necessarily make him a court within the meaning of Section 195 of the said Code. The Registrar's nominee is merely an Arbitrator within the limits of the power conferred to adjudicate upon the dispute referred to him and is not entrusted with the judicial power of the State. 14. In Town Municipal Council's case (supra) the Apex Court dissented from the decision of a Full Bench of the Bombay High Court in Manager, P.K. Porwal v. Labour Court [(1968) 70 Bom LR 104] and held that Article 137 of the Limitation Act, 1963 does not apply to applications under Section 33C(2) of the Industrial Disputes Act, 1947. The Apex Court gave two reasons for coming to this conclusion.
The Apex Court gave two reasons for coming to this conclusion. The first reason was that, in spite of the changes made in the Limitation Act, 1963, no drastic change was intended in the scope of Article 137, so as to include within it all applications irrespective of the fact whether they had any reference to the Code of Civil Procedure or not. Therefore, it was held that, in spite of the changes, the interpretation of Article 181 of the Limitation Act, 1908, by the Apex Court in Bombay Gas Co. Ltd. v. Gopal Bhiva [ AIR 1964 SC 752 ] would apply to Article 137 of the Limitation Act, 1963. The second reason given by the Apex Court was that, it is only applications to courts that are intended to be covered under Article 137 of the Limitation Act, 1963. 15. In Nityanand M. Joshi v. Life Insurance Corporation of India [ (1969) 2 SCC 199 ], after referring to the decision in Town Municipal Council's case (supra), a Three-Judge Bench of the Apex Court reiterated that, the scheme of the Limitation Act, 1963 is that it only deals with applications to courts, and that the Labour Court is not a court within the Limitation Act. The Apex Court held that, Article 137 of the Limitation Act only contemplates applications to courts. In the Third Division of the Schedule to the Limitation Act, all the other applications mentioned in the various Articles are applications filed in a court. Further, Section 4 of the Limitation Act provides for the contingency when the prescribed period for any application expires on a holiday and the only contingency contemplated is 'when the court is closed'. Again under Section 5 of the said Act it is only a court which is enabled to admit an application after the prescribed period has expired, if the court is satisfied that the applicant had sufficient cause for not preferring the application. 16. In Nityanand M. Joshi's case (supra), the Three-Judge Bench, without expressing its views on the first reason given in Town Municipal Council's case (supra), observed that it may require serious consideration whether applications to courts under other provisions, apart from Civil Procedure Code, are included within Article 137 of the Limitation Act, 1963 or not.
16. In Nityanand M. Joshi's case (supra), the Three-Judge Bench, without expressing its views on the first reason given in Town Municipal Council's case (supra), observed that it may require serious consideration whether applications to courts under other provisions, apart from Civil Procedure Code, are included within Article 137 of the Limitation Act, 1963 or not. In Kerala State Electricity Board v. T.P.Kunhaliumma [ (1976) 4 SCC 634 ] a Three-Judge Bench of the Apex Court differed from the view (first reason) taken by the Two-Judge Bench in Town Municipal Council's case (supra) and held that, Article 137 of the Limitation Act, 1963 will apply to any petition or application filed under any Act to a civil court, and that Article 137 is not confined to applications contemplated by or under the Code of Civil Procedure, 1908. The Three-Judge Bench held further that, the changed definition of the words 'applicant' and 'application' contained in Section 2(a) and Section 2(b) of the Limitation Act, 1963 indicates the object of the said Act to include petitions, original or otherwise, under special laws. Therefore, the interpretation which was given to Article 181 of the Limitation Act, 1908 on the principle of ejusdem generis is not applicable with regard to Article 137 of the Limitation Act, 1963. 17. In Sakuru v. Tanaji [ (1985) 3 SCC 590 ], after referring to the decisions in Town Municipal Council's case and Nityanand M. Joshi's case referred to supra and also Sushila Devi v. Ramanandan Prasad [ (1976) 1 SCC 361 ], the Apex Court held that the provisions of the Limitation Act, 1963 apply only to proceedings in 'courts' and not to appeals or applications before bodies other than courts such as quasi-judicial tribunals or executive authorities, notwithstanding the fact that such bodies or authorities may be vested with certain specified powers conferred on courts under the Code of Civil Procedure or the Criminal Procedure Code. The Collector before whom the appeal was preferred by the appellant therein under Section 90 of the Andhra Pradesh (Telangana Area) Tenancy and Agricultural Lands Act, 1950 not being a court, the Limitation Act, as such, had no applicability to the proceedings before him.
The Collector before whom the appeal was preferred by the appellant therein under Section 90 of the Andhra Pradesh (Telangana Area) Tenancy and Agricultural Lands Act, 1950 not being a court, the Limitation Act, as such, had no applicability to the proceedings before him. But even in such a situation the relevant special statute may contain an express provision conferring on the appellate authority, such as the Collector, the power to extend the prescribed period of limitation on sufficient cause being shown by laying down that the provisions of Section 5 of the Limitation Act shall be applicable to such proceedings. 18. In Kavi Rajan v. Co-operative Tribunal [ 1989 (2) KLT 895 ] a Division Bench of this Court held that, the principle laid down in Thilakan's case (supra) stands affirmed by the Apex Court in Sakuru's case (supra) and hence, the law stands clearly settled that the Limitation Act, 1963 does not apply to proceedings under the Kerala Co-operative Societies Act, 1968. 19. In Consolidated Engineering Enterprises v. Irrigation Department [ (2008) 7 SCC 169 ] a Three-Judge Bench of the Apex Court held that, where the Schedule to the Limitation Act prescribes a period of limitation for appeals or applications to any court, and the special or local law provides for filing of appeals and applications to the court, but does not prescribe any period of limitation in regard to such appeals or applications, the period of limitation prescribed in the Schedule to the Limitation Act will apply to such appeals or applications and consequently the provisions of Sections 4 to 24 will also apply. Where the special or local law prescribes for any appeal or application, a period of limitation different from the period prescribed by the Schedule to the Limitation Act, then the provisions of Section 29(2) will be attracted. In that event, the provisions of Section 3 of Limitation Act will apply, as if the period of limitation prescribed under the special law was the period prescribed by the Schedule to Limitation Act, and for the purpose of determining any period of limitation prescribed for the appeal or application by the special law, the provisions contained in Sections 4 to 24 will apply to the extent to which they are not expressly excluded by such special law.
The object of Section 29(2) is to ensure that the principles contained in Sections 4 to 24 of Limitation Act apply to suits, appeals and applications filed in a court under special or local laws also, even if it prescribes a period of limitation different from what is prescribed in the Limitation Act, except to the extent of express exclusion of the application of any or all of those provisions. The Apex Court held further that, the Schedule to the Limitation Act prescribes the period of limitation only to proceedings in courts and not to any proceeding before a tribunal or quasi-judicial authority. Consequently, Section 3 and Section 29(2) of Limitation Act will not apply to proceedings before a tribunal or quasi-judicial authority. 20. In M.P. Steel Corporation v. Commissioner of Central Excise [ (2015) 7 SCC 58 ], the Apex Court reiterated that, on a plain reading of the provisions of the Limitation Act, 1963 it becomes clear that suits, appeals and applications are only to be considered (from the limitation point of view) if they are filed in courts and not in quasi-judicial bodies. As held in Consolidated Engineering Enterprises' case (supra), the decision of the Three-Judge Bench in Commissioner of Sales Tax v. Parson Tools and Plants [ (1975) 4 SCC 22 ] is an authority for the proposition that the Limitation Act will not apply to quasi-judicial bodies or tribunals. Therefore, the decision of the Two-Judge Bench in Mukri Gopalan v. Cheppilat Puthanpurayil Aboobacker [ (1995) 5 SCC 5 ] to the extent it is in conflict with the decision in Consolidated Engineering Enterprises' case (supra) is no longer good law. 21. As per Section 69(1) of the Kerala Co-operative Societies Act monetary dispute between the society and a member of that society shall be referred to the Registrar, who shall decide such dispute and no other court or authority shall have jurisdiction to entertain any suit or other proceedings in respect of such dispute.
21. As per Section 69(1) of the Kerala Co-operative Societies Act monetary dispute between the society and a member of that society shall be referred to the Registrar, who shall decide such dispute and no other court or authority shall have jurisdiction to entertain any suit or other proceedings in respect of such dispute. The Registrar or any person conferred with the powers of the Registrar under Section 69 of the Act, in terms of any general or special order issued by the Government in exercise of its powers under Section 3(2) of the Act, is only a quasi-judicial authority, who is vested with the powers to decide the dispute or pass an award in accordance with the provisions of the Act, the Rules and the bye-laws, as provided under Section 70(6) of the said Act. 22. As per Section 77 of the Kerala Co-operative Societies Act, the Registrar or any person empowered by him in this behalf shall be deemed, when exercising any power under the said Act for the recovery of any amount by the attachment and sale or by sale without attachment of any property, or when passing any orders on any application made to him for such recovery, to be a civil court for the purposes of Article 136 of the Schedule to the Limitation Act, 1963. The Registrar or any person conferred with the powers of the Registrar under Section 69 of the Act is only a quasi-judicial authority and not a court. In such circumstances, the provisions of the Limitation Act have no application in the proceedings before the Registrar or any person conferred with the powers of the Registrar under Section 69 of the Act, notwithstanding the fact that such a quasi-judicial authority has been conferred with certain specified powers of the civil court, as provided under Section 77 of the Kerala Co-operative Societies Act, for the recovery of any amount by the attachment and sale or by sale without attachment of any property, or when passing any orders on any application made to him for such recovery. The Registrar or any person conferred with the powers of the Registrar under Section 69 of the Act, who is not entrusted with the judicial power of the State, acts as a quasi-judicial authority within the limits of the powers conferred by that Section, while adjudicating the dispute referred to him.
The Registrar or any person conferred with the powers of the Registrar under Section 69 of the Act, who is not entrusted with the judicial power of the State, acts as a quasi-judicial authority within the limits of the powers conferred by that Section, while adjudicating the dispute referred to him. In such circumstances, the Schedule to the Limitation Act, 1963 which prescribes the period of limitation only to proceedings in courts have no application to proceedings under Section 69 of the Act, before the Arbitrator. Consequently, Section 3 and Section 29(2) of Limitation Act have no application to any such proceedings before the Arbitrator. In that view of the matter, the Co-operative Tribunal rightly found in Ext.P8 judgment that the provisions under the Limitation Act, 1963 have no application to proceedings before the Arbitrator under Section 69 of the Kerala Co-operative Societies Act. 23. Ext.P4 claim in A.R.C.No.434/2012 is one dated 15.05.2012. On receipt of notice, the petitioner filed Ext.P5 objection dated 14.3.2013, essentially contending that the claim is time barred, either based on Ext.P1 Gahan or Ext.P3 venkadapathram. During the pendency of A.R.C.No.434/2012, by the Kerala Co-operative Societies (Amendment) Act, 2013 subsection (4) was inserted to Section 69 of the Kerala Co-operative Societies Act, which provides that all monetary disputes mentioned in Schedule III to the Act shall be filed within the time limit specified in the said Schedule. The fact that, prior to the insertion of sub-section (4) of Section 69, no time limit was prescribed under the Kerala Co-operative Societies Act for referring monetary disputes to the Arbitrator is not in dispute. 24. After the insertion of sub-section (4) of Section 69 of the Kerala Co-operative Societies Act, the Government vide G.O. (P)No.136/2013 Co.op. dated 30.10.2013 exempted all societies from the provisions of that sub-section for a period of one year from 14.02.2013. A reading of the said Government order would show that, on the commencement of the Amendment Act, 2013 large number of cases existed in the societies became time barred and the societies were not in a position to recover the amount due from defaulters.
A reading of the said Government order would show that, on the commencement of the Amendment Act, 2013 large number of cases existed in the societies became time barred and the societies were not in a position to recover the amount due from defaulters. The Registrar of Co-operative Societies recommended to the Government to exempt all societies from the provisions of sub-section (4) of Section 69 of the Act for a period of one year with effect from the date of commencement of the Amendment Act, 2013, i.e., from 14.02.2013, so as to enable the societies to file arbitration cases on such disputes, within the extended time limit. The Government, having considered the matter in detail and being satisfied that it is necessary in public interest to exempt, in exercise of the powers conferred by Section 101 of the Act, all societies from the provisions of sub-section (4) of Section 69 of the Act for a period of one year with effect from 14.02.2013, issued the aforesaid Government order dated 30.10.2013 exempting all societies from the provisions of subsection (4) of Section 69 of the Act for a period of one year from 14.02.2013. 25. As on the date of filing of Ext.P4 claim, there was no time limit for referring monetary disputes for arbitration under Section 69 of the Act. As such, the reasoning of the Tribunal that the claim made by the 4th respondent Co-operative Bank is not barred by limitation is perfectly legal, which warrants no interference in this writ petition. Therefore, the challenge made in this writ petition against Ext.P6 award of the 2nd respondent Arbitrator, Ext.P8 judgment of the Co-operative Tribunal and Ext.P9 demand notice of the 3rd respondent Special Sale Officer on the sole ground that the claim in A.R.C.No.434/2012 was barred by limitation as on the date of filing of Ext.P4 claim can only be repelled and I do so. 26. It is pertinent to note that, the challenge made in this writ petition against Ext.P8 judgment of the Co-operative Tribunal dated 31.07.2015 is highly belated, inasmuch as, the petitioner has chosen to file this writ petition only on 27.07.2017, nearly two years after the said judgment, when he was issued with Ext.P9 demand notice dated 24.7.2017 of the 3rd respondent Special Sale Officer, seeking recovery of a sum of Rs.88,147/-, pursuant to that judgment of the Tribunal.
Therefore, this writ petition is liable to be dismissed on that ground as well. In the result, this writ petition fails and the same is accordingly dismissed. No order as to costs.