Prem Kumar vs Banshilal and Others

Atul Kumar Jain, J.

The Court of ADJ, Beawer had dismissed the suit No. 228/2003 filed by the appellant under Order 7 Rule 11(d) CPC on the application of the defendants/respondents by order dated 13.8.2004. That order has been challenged by plaintiff/appellant Prem Kumar in this Court in this Civil First Appeal.

I have heard arguments of both the parties. Both the parties agree that for decision on application filed under Order 7 Rule 11 CPC contents of the plaint are only to be seen and the points mentioned in the defendants'' written statement are irrelevant at that stage. This view gets support from following rulings also:--

"(1) Sopan Sukhdeo Sable and Others Vs. Assistant Charity Commissioner and Others, and

(2) Bhau Ram Vs. Janak Singh and Others, "

Next point argued before this Court by the appellant is to the effect that the lower court has wrongly interpreted the provisions of Section 75 and Section 137 of the Rajasthan Cooperative Societies Act, 1965 (for short the Act of 1965) in this case. It is pertinent to mention here that the case is governed by the old Cooperative Societies Act because when the suit was filed the Rajasthan Cooperative Societies Act, 2001 had not come into force. Section 75 and Section 137 of the Act of 1965 provides as under:--

"75. Disputes which may be referred to arbitration.--(1) Notwithstanding anything contained in any law for the time being in force, if any dispute touching the constitution, management, or the business of a co-operative 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 committee or any officer, agent or employee of the society, or

(c) between the society or its committee and any past committee, any officer, agent or employee, or any past officer, past agent or past employee or the nominee, heirs or legal representatives of any deceased officer, deceased agent or deceased employee of the society, or

(d) between the society and any other cooperative society,

(e) between the society and the surety of a member, past member or a deceased member, or a person other than a member who has been granted a loan by the society or with whom the society has or had transaction under Section 66, whether such a surety is or is not a member of a society,

such dispute shall be referred to the Registrar for decision and no court shall have jurisdiction to entertain any suit or other proceeding in respect of such dispute.

(2) For the purposes of Sub-section (1), the following shall be deemed to be disputes touching the constitution, management or the business of a co-operative society, namely:--

(a) a claim by the society for any debit or demand due to it from a member or the nominee, heirs or legal representatives of a deceased member, whether such debt or demand be admitted or not;

(b) a claim by a surety against the principal debtor where the society has recovered from the surety any amount in respect of any debt or demand due to it from the principal debtor as a result of the default of the principal debtor, whether such debt or demand is admitted or not;

(c) any dispute arising in connection with the election of any officer of the society.

(3) If any question arises whether a dispute referred to the Registrar under this section is a dispute touching the constitution, management or the business of a cooperative society, the decision thereon the Registrar shall be final and shall not be called in question in any court.

Bar of jurisdiction of courts.--

(1) Save as provided in this Act, no civil or revenue court shall have any jurisdiction in respect of.--

(a) the registration of a co-operative society or of an amendment of a bye-law;

(b) the removal of a committee;

(c) any dispute required under Section 75 to be referred to the Registrar; and

(2) While a co-operative society is being wound up, no suit or other legal proceedings relating to the business of such society shall be proceeded with, or instituted against, the liquidator as such or against the society or any member thereof, except by leave of the Registrar and subject to such terms as he may impose.

(3) Save as provided in this Act, no order, decision or award made under this Act shall be questioned in any court on any ground whatsoever."

In Ramesh Chand Ardawatiya Vs. Anil Panjwani, and Harsh Vardhan Kejriwal Vs. Madhav Nagar Grah Nirman Sahkari Samiti Ltd. and Others, , it was held that the Act of 1965 will be applicable only when defendant is also a member of the society or claiming under a member. If the plaintiff does not have any dispute with another member of the society or the society itself then the bar of Section 75 and Section 137 of the Act of 1965 may not apply. It was further held in these cases that if the dispute between the parties does not come within the ambit of Section 75 then the domain of a civil court cannot be excluded. In these cases, it was also held that wholesome reading of Section 75 indicates that it is the dispute between the members inter-se or between members and the society or between two or more societies relating to their working as cooperative society alone in accordance with law including its byelaws and not in an illegal or unlawful manner like encroachment or other illegal possession etc., which is sought to be excluded not wherein intricated question of fact and law relating to title, possession and contractual obligations are called in question for which civil courts alone have the jurisdiction under the provisions of Section 9 CPC along with other relevant provisions providing for trying such civil suit by the civil courts in CPC.

Appellant also relies upon Madhyam Vargiya Grih Nirman Sahakari Sanstha Vs. Vasantrao and another, . In this case, it was held by the High Court of MP that if a Cooperative Housing Society had sold a plot to its member and the member in turn sold it to another person in violation of terms and conditions of sale-deed executed by the society in favour of the member and consequently, the society filed a suit again both of them with a prayer for cancellation of the sale-deed executed by the member and for removal of construction made by another person, it could not be said that averments made in the plaint raised a question only touching the business of the society within the meaning of Section 64 of the MP Cooperative Societies Act.

I have perused the rulings referred by the appellant.

Respondents rely upon the logic given by the court below when it had dismissed the suit of plaintiff by accepting the application under Order 7 Rule 11(d) CPC filed by the defendants.

The trial court has elaborated the facts given in the plaint. As per the plaint, suit property was allotted by the Refugee Housing Cooperative Society, Vijay Nagar to Bhagwan Das and Bhagwan Das procured some loan from the society and did not pay the loan amount to the society. So the society transferred the possession of the plot to Bishan Das and since then Bishan Das was in possession of the suit property. After death of Bishan Das his son Narayan Lal got the possession of the suit property and after death of Narayan Lal, appellant plaintiff Prem Kumar got the possession of the suit property. Along with the plaint, the plaintiff had submitted so many documents of the Cooperative Society with copy of the correspondences made by the Cooperative Society with the parties. These documents mention that by an agreement Bhagwan Das had sold the suit property to Pesumal (father of respondents Nos. 1 to 4) and after death of Pesumal his sons (respondents Nos. 1 to 4) are claiming title and possession of the suit property. Thus, it can be said that there is a dispute between a member of the Cooperative Society and an assignee of another member of the Cooperative Society in which rights of the Cooperative Society are also in dispute and so looking to Section 75 (a) and Section 137(1)(c) of the Act of 1965, the court below has rightly refused to entertain the suit and so the court below had not committed any illegality by applying the provisions of Order 7 Rule 11(d) of CPC in the

Hence this civil first appeal filed by the appellant-plaintiff Prem Kumar is bereft of any force and it deserves dismissal, which is hereby dismissed. Stay application, if any, also stands disposed of accordingly.

Copy of this order be sent to the court below immediately by speed post.