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Judgment
Srinivasan, J.
This second appeal has to be dismissed on a very short ground that the suit filed by the appellant/plaintiff is not maintainable. S. 90 of the Tamil Nadu Co-operative Societies Act, 1983 (Act No.30 of 1983) hereinafter referred to as the Act, is in the following terms to the extent to which it is relevant.
Disputes:-(1) If any dispute touching the constitution of the board or the management or the business of a registered society (other than a dispute regarding disciplinary action taken by the competent authority constituted under sub S.(3) of S. 75 or the Registrar or the Society or its board against a paid servant of the Society) arises.
(a) among members, past members and persons claiming through members, past members and deceased members; or (b) between a member, past member or person claiming through a member, past member or deceased member and the society its board or any officer, agent or servant of the society or.
(c) between the society or its board and any past board any officer agent or servant, or any past officer, past agent or past servant, or the nominee, heirs or legal representatives of any deceased officer, deceased agent, or deceased servant of the Society or.....
It is not necessary to extract the remaining portion of the section. The expressions used in the section are of wide import and in sub S.(1) there are three expressions (1) the constitution of board, (2) the management and (3) the business of a registered society. The dispute raised in this case will undoubtedly fall within the second and third expression namely the management and the business of a registered society. It will also fall under clause (b) of the section as the parties to the dispute are members of the society represented by one of them, and the society itself represented by the Special Officer appointed to manage the society.
The prayer in the plaint is for a declaration that the defendants are not entitled to induct or eject any person into membership or from membership till the duly elected board takes charges and for a consequential permanent injunction restraining the defendants from in any way inducting or ejecting any person into membership or from membership till the duly elected board takes charge. The basis of the claim as set out in the plaint is that the special Officer, appointed to manage the affairs of the society can only manage the society and he is not empowered, to induct or expel any member from the society. As set out in the plaint, the contention of the plaintiff is that the defendants cannot exercise the function of the Board of Management which was previously managing the society. Apart from that certain allegations are made with regard to the validity of the appointment of the Special Officer. But it is admitted in the Plaint itself that the validity of the appointment of the Special Officer was called in question in a writ proceeding in this Court, namely W.P.6491 of 1989. It is not in dispute that the writ petition referred to in the plaint has been dismissed on 3.8.89 by this Court and the validity of the appointment of the special officer has been upheld by this Court. Hence it is no longer open to challenge the validity of the appointment of the Special Officer and his capacity to represent the society.
In fact, the plaintiff has impleaded the society as the defendant and described the Special Officer as its representative. Once the suit is filed against the society as such, which is a legal person and when is shown to be represented by the Special Officer, it is not open to the plaintiff to contend that the Special Officer is not the person authorised to represent the society. The suit is not filed against the Special Officer as an individual but only filed against the society represented by the Special Officer. Hence various contentions put forward by Learned Counsel for the appellant do not arise for consideration really in this second appeal.
Learned Counsel for the appellant contends that an attempt has been made by the Special Officer to induct certain persons as member of the society and they are not entitled to become members of the society. That is not a question which can be considered in a Civil Court. That question has to considered as per bye-laws. Bye-law No.5 of the society provides for admission of members to the society. Under By-law No.5 (1)(a) it is stated that any silk weaver over eighteen years of age who is competent to contract residing within the limits referred to in the third sentence of by-law I shall be eligible for admission as a member. It is also made clear that it is competent to the Board of Directors to admit, as members, non-weavers other than master weavers and dealers. Thus By-law No.5 (1) gives wide powers to the Board of Directors to admit any person as member even though he is a non-weaver.
The Special Officer is exercising powers of the Board under sub-S.(3) of S. 88 of the Act. The Special Officer appointed under sub-S.(1) shall have power to exercise all or any of the functions of the board or of any officer of the society and to take such action as may be required in the interest of the society. Under S. 89(2) it is stated that the provisions of sub-S.(2) to (5) and sub-Ss.(7) and (8) of S. 88 so far as may be, shall apply in relation to the appointment of a Special Officer under sub- S.(1) as they apply in relation to the appointment of a Special Officer under sub-S.(1) of S. 88. Hence the Special Officer appointed under S. 88 or 89 shall have powers to carry out the functions of the Board.
The Special Officer who is representing the society is entitled under the Bye-laws to induct any person as a member of the society. The question whether he has inducted a qualified person is to be decided only by the Registrar because of the provisions of S. 90 of the Act as extracted above.
Learned Counsel for the appellant contends that induction or expulsion of a member will not fall within the term management or business of the society, For this he placed reliance on the judgment reported in Dr. Savitri Bai Nagan Goud and Others Vs. Gutti Thotappa, . In that case the question was whether a dispute relating to the dismissal of the President of the society from the office of Presidentship could be said to be a dispute touching the business of the society so as to fall outside the scope of the jurisdiction of a Civil Court. The learned Judge took the view that on the language of the section as it stood it would not be a dispute touching business of society. But that view has been overruled by a Full Bench in a decision reported in M.S. Madhava Rao and Others Vs. D.V.K. Surya Rao, Member of the Pithapuram Co-operative Bank, Pithapuram and Others,
The Full Bench had considered the scope and meaning of the expression touching the business of the society. The Full Bench observed that the terms are very wide and would include a dispute relating to expulsion of a member of the society.
The Full Bench referring to earlier Judgment of this Court in C.M.P. Nos. 6730 and 7759/50 and accepting the view of the Division Bench therein observed thus:-
in C.M.P. Nos. 6730 and 7759 of 1950 the Hon''ble the Chief Justice and Viswanatha Sastri, J. had to consider the question, whether a dispute relating to the expulsion of a member from a society was within S. 51 of the Act. The petitioner in that case moved the Registrar under S. 51 of the Act for a decision as to the validity of his expulsion, but the Registrar declined jurisdiction on the ground that the dispute was not one within the scope of S. 51.
An appeal to the Government by the petitioner was unsuccessful, and he then moved this Court by a writ, which as the learned Judges, held should have been for mandamus directing the Registrar of Co-operative Societies to proceed to decide the dispute. The bye-law of the society under which the power exercised of expelling the member was as follows:-
If a member deceives the society in any way, or if his general conduct is such as to render his removal necessary in the interests of the society, it shall be open to the general body to expel such member. A member expelled shall be paid money due to him from the society. A member who drives the society to the Court to recover the money due from him shall, for that reason, be expelled from membership. A member expelled shall be liable as proved in bye-law 3 for the debts due by the society as they should on the date of his expulsion for a period of two years after such expulsion.
The learned Chief Justice held that there being provision in the bye-laws for the expulsion of a member, and having regard to the language of S. 51, the dispute was undoubtedly within the scope of S. 51. The learned Chief Justice, who delivered the judgment of the Court, observed:-
We fail to see how a dispute raised by one of the members of the society against an action of the society taken at the meeting of the general body of the society in the exercise of power conferred by one of the society''s bye-laws, cannot be said to be a dispute touching the business of the society. On the day when the resolution was passed expelling the petitioner from membership admittedly this matter of expulsion was one of the items of business on the agenda of the meeting. We do not think it extravagant to hold that the expulsion of an undesirable member is also a part of the business of the society. If so any dispute relating to such an expulsion would be a dispute touching the business of the society.
We respectfully agree with these observations of the learned Chief Justice concurred in by Viswanatha Sastri, J. that if a bye- law not being ultra vires empowers a society to do a particular act, that act would be the business of the society. It would also be a corporate activity of the society when the decision of expelling a member is under at the corporate meeting of the general body in the exercise of the power conferred upon it by the bye-laws of the society. The learned Chief Justice considered also the three decisions of the Calcutta High Court already referred to and disguised them as not applicable to the facts of the case before the learned Judge on the ground that in the case before him the petitioner complained against the action of the society, an action which, was sought to be justified by bye-law 35 of the society. No doubt, to quote the learned Chief Justice:
The bye-law gives to the society the right to expel a member by a resolution passed at a meeting of the general body. The only question is whether the power so conferred was rightly exercised by the society. This matter is, in our opinion clearly a dispute touching the business of a registered society within the meaning of S. 51 of the Co-operative Societies Act.
The Registrar was, therefore, directed that as it is a matter within his jurisdiction he should proceed to take up the petition filed by the petitioner and decide the dispute referred to him. With great respect to the learned Judges, we entirely agree with the decision as laying down the law correctly.
In Writ Petition Nos. 317 and 318 of 1951. Govinda Menon and Panchapakesa Ayyar. JJ had again to consider the question of the expulsion of a member from a society. The dispute related to the Madura Mills Workers Co-operative Stores Ltd. The Madura Labour Union was admitted under bye-law 5 of the society as a member of the society and under bye-law 19, the executive management of the affairs of the society was vested in a Board of Directors of not more than five one of whom had to be a nominee of the Madura Labour Union. Bye-law 20 provided for the election of the other directions.
The Board of Directors was superseded under S. 43 of the Act by the Registrar, and he appointed a Special Officer to manage the affairs of the society. The Special Officer convened a general body meeting of the society, which was held on 12th March 1931 wherein certain amendments to the bye-laws were made.
One of the amendments to bye-laws 5 and its effect were to make it no longer obligatory to have a nominee of the Madura Labour Union on the Board of Directors. By an amendment to bye-law 14 power was conferred on the general body to remove the nominee of the Madura Labour Union from the Board of Directors and resolutions were also passed under bye-law 35, which is in the same terms as the bye-law quoted in the unreported judgment of the learned Chief Justice and Viswanatha Sastri, J. already referred to. In the petition for the writ of mandamus the petitioners, the Madura Labour Union, attacked the validity of the resolutions passed at the meeting on 18th March. 1951, and the amendment made to the constitution and also to the resolution expelling the Union from membership. It was held by the learned Judges that the expulsion of the Madura Labour Union by a resolution passed at the meeting on 18th March, 1951 was illegal, as the Union was not given an opportunity of explaining and defending itself, and the principles of natural justice were not observed and the maxim audi alteram partem was violated. The point raised was whether the petitioners remedy was a suit or a reference under S. 51 of the Act. It was contended on behalf of the petitioners that S. 51 did not apply, as the expulsion of a member was not a matter touching the business of the society and therefore, outside the purview of S. 51. The learned Advocate-General also did not dispute the position as his contention was that the petitioners had another remedy viz. a suit, and therefore the writ should not be issued. The decision of the learned Chief Justice and Viswanatha Sastri, J. was brought to the notice of the learned Judges, as therein it was decided that a dispute relating to the expulsion of a member is a dispute touching the business of a society under bye-law 35, and therefore the exclusive jurisdiction to decide the dispute vested in the Registrar under S. 51 of the Act. But the learned Judges adhered to the view taken by Govinda Menon, J. sitting as a single Judge in Savitri Bai Nagan Goud v. Thotappa as expressing the similar view and dissented from the decision of the learned Chief Justice and Viswanatha Sastri, J. It would be seen that there was really no conflict as Savitri Bai Nagan Goud v, Thottappa 1950 2 MLJ 75 was the case in which the society was not empowered by the bye-law to remove the President, while in the case before the learned Chief Justice and Viswanatha Sastri, J. the bye-law authorised the expulsion of the member by the general body. In the one case the removal of the President, was not the business of the society, while in the other case the expulsion of the member was within its scope. The dispute in the case before Govinda Menon and Panchapakesa Ayyar, JJ. relating to the expulsion of the member viz. Madura Union, was undoubtedly within bye-law 35, and therefore, exclusively triable by the Registrar under S. 51 of the Act. If the principles of natural justice were violated by the authority concerned in passing the resolution expelling the member it would have been perfectly open to the Registrar to consider that aspect and give relief to the petitioner. It is one thing to say that the adjudication by a Tribunal is vitiated by the non-observance of the principles of natural justice and a totally different thing to say that a general body has violated such principles. The violation of the principles by the general body is a matter which could be rectified and considered by the Registrar acting under S. 51 of the Act. while an adjudication by the tribunal under such circumstances could be set aside by a Court. Instead of the learned Judges dissenting from the judgment of a Bench, if we may say so with respect, they could have adopted the course of referring it to a Full Bench as was pointed out by the Full Bench in Gundavarapu Seshamma Vs. Kornepati Venkata Narasimha Rao and Others, C.J. observed as follows:-
The Division Bench is the final court of Appeal in an Indian High Court unless the case is referred to a Full Bench and one Division Bench should regard itself bound by the decision of another Division Bench on question of law. In England, where there is the Court of Appeal. Divisional Courts follow the decisions of other Divisional Courts on the grounds of judicial comity. If a Division Bench does not accept as correct the decision on a question of law of another Division Bench, the only right and proper course to adopt is to refer the matter to a full Bench, for which the Rules of this Court provide. If this course is not adopted, the Courts subordinate to the High Court are left without guidance. Apart from the impropriety of an appellate Bench refusing to regard itself bound by a previous decision on a question of law of an appellate Bench of equal strength and the difficulty placed in the way of subordinate Courts administering Justice, there are the additional factors of the loss of money and the waste of Judicial time.
The conclusion reached by the learned Judges that the dispute was not one within S. 51 of the Act is, in our opinion, erroneous.
Thus it is clear that the Full Bench overruled the decision rendered by Govinda Menon, J.
The language of the present Act which was passed in 1983 is much wider than the Act which was considered by the Full Bench in the abovesaid case. In the present section two more expressions are added: (1) constitution of the Board and (2) the Management. Here the admission of any person as member of the society or expulsion of a person from the membership would undoubtedly fall within the purview of the term management. Learned Counsel for the appellant contends that management would not include induction or expulsion of a member. I do not agree. The term is wide enough to cover admission and expulsion of members. In this case the grievance in the plaint is that the Special Officer is admitting unqualified persons as members of the society. That is a dispute which can be decided only by the Registrar of Co-operative Societies under S. 90 of the Act and it cannot be gone into by a Civil Court.
Learned Counsel for the appellant placed reliance on a judgment of the Privy Council reported in AIR 1940 105 (Privy Council) The Privy Council in that case held that the exclusion of the jurisdiction of the Civil Courts is not to be readily inferred but such exclusion must either be explicitly expressed or clearly implied. Even if jurisdiction is so excluded, the Civil Courts have jurisdiction to examine into cases where the provisions of the Act have not been complied with, or the statutory tribunal has not acted in conformity with the fundamental principles of judicial procedure". The observations made by the Privy Council do not have any bearing on this case.
This case is governed by a ruling of the Supreme Court in Raja Ram Kumar Bhargava (Dead) by Lrs. Vs. Union of India (UOI), The law is set out clearly by the Supreme Court. After referring to the judgment of the Privy Council in AIR 1940 105 (Privy Council) and two other judgments of the Supreme Court, it was observed as follows:-
The question turns on the scope of the exclusionary clause in the statute. The effect of Clauses excluding the civil courts jurisdiction is considered in several pronouncements of the Judicial Committee and of this Court. Generally speaking the broad guiding considerations are that whatever a right, not pre-existing in common law is created by a statute and that statute itself provided a machinery for the enforcement of the right, both the right and the remedy having been created in flatu and a finality is intended to the result of the statutory proceedings, then, even in the absence of an exclusionary provision the Civil Court jurisdiction is impliedly barred. If, however, a right pre-existing in common law is recognised by the statute and a new statutory remedy for its enforcement provided, without expressly excluding the Civil Court jurisdiction, then both the common law and the statutory remedies might become concurrent remedies leaving open an element of election to the persons of inherence.
The above passage clearly points out that where it is a question of right created by statute and remedy is provided under the statute, the Civil Court jurisdiction is impliedly barred. In this case a right to become a member of the Co-operative Society is created by the Act. By-laws and the Rules, and remedies are provided under the Act itself. Hence, the provisions of S. 90 of the Act would undoubtedly bar the jurisdiction of the Civil Court.
In this view, it is wholly unnecessary for me to consider the other arguments advanced by Learned Counsel for the appellant. Learned Counsel for the appellant contends that the objection, as to the bar of S. 90 of the Act has not been raised in the written statement. I am of the view that as it is pure question of law relating to jurisdiction, the omission to raise the point expressly in the written statement will not prevent the Court from considering this aspect of the matter, particularly when the maintainability of the suit was challenged in the written statement. In the result, the second appeal fails and is dismissed with costs.