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Judgment
Heard. Admit. Heard finally with the consent of the learned Counsel appearing on behalf of the respective parties.Â
The applicants herein are the original defendants who have challenged the order dated 05.04.2017 passed by the Court of Civil Judge, Senior
Division, Khamgaon (trial Court) rejecting their application for rejection of plaint under Order 7 Rule 11 of the Code of Civil Procedure.
The facts leading to filing of the instant revision application are that the respondents herein (original plaintiffs) filed Special Civil Suit No. 5 of 2013
for recovery of money against the applicants herein. It was claimed by the respondents that the applicants had placed orders for purchasing cotton
bales and that they had failed to pay balance amount in respect of the said transactions. In this suit, the applicants appeared and filed an application
under Order 7 Rule 11 of the Code of Civil Procedure claiming that the suit was barred by the provisions of West Bengal CoÂoperative Societies Act,
2006. It was pleaded that under Section 102 of the aforesaid Act, any dispute between the Cooperative Society like applicant No.1 herein and any
person having transaction with it, shall be resolved by approaching the Registrar appointed under the said Act and that Civil Courts were barred from
entertaining any proceedings in respect of such dispute. On this basis, it was contended that the suit for recovery filed by the respondents was
barred by law and that the plaint deserved to be rejected. The respondents resisted the said application and contended that the Civil Court had
jurisdiction in the matter and that the plaint could not be rejected at the threshold.
By the impugned order dated 05.04.2017, the trial Court has considered the provisions of the aforesaid Act and it has come to the conclusion that
since the respondents were not members of the applicant/ Cooperative Society, it could not be said that they were required to approach only the
Registrar under the said Act and that the suit could not be said to be barred by law. On this basis, the trial Court rejected the aforesaid
application. Aggrieved by the same, the present revision application has been filed.
Shri Mohata, learned Counsel appearing on behalf of the applicants submits that the trial Court has failed to appreciate the provisions of the said
Act, particularly Sections 102(1)(d) and 102(4) read with Section 4(25) of the said Act, while passing the impugned order. It is contended that a
proper reading of the said provision would show that a dispute between a cooperative society registered under the said Act and any person having
transaction with it, was necessarily required to be decided by the Registrar under the said Act and the Civil Court was barred from exercising
jurisdiction for resolution of such dispute. It was submitted that there were provisions in the said Act pertaining to appeals for challenging the order
of the Registrar.
Learned Counsel for the applicants has placed reliance on the judgment of the Special Bench of the Calcutta High Court in the case of Anjan
Choudhury .v. Anandaneer CoÂoperative Registered Housing Society and others (reported in AIR 1990 CALCUTTA 380) concerning a paraÂ‐
materia provision wherein Special Bench held that a plaint was liable to be rejected in circumstances similar to those in the present case.
Shri Saboo, learned Counsel appearing on behalf of the respondents opposes the contentions raised on behalf of the applicants herein. It is
submitted that the contentions raised on behalf of the applicants were a matter of trial and that the plaint could not be rejected at the threshold.Â
A perusal of the relevant provisions in the present case is necessary to decide whether the impugned order passed by the trial Court was
justified. The relevant provisions of the aforesaid Act read as follows :Â
“(25) “dispute†means any matter capable of being the subject of civil litigation, and includes a claim in respect of any sum payable to or by a
coÂoperative society;
Disputes to be filed before Registrar. Â (1) Any dispute concerning the management or business or affairs of a coÂoperative society other than
the dispute relating to election in a coÂoperative society as and when such election is conducted by the CoÂoperative Election Commission and
disciplinary action taken by cooperative society against its paid employees regarding the terms and conditions of the service shall be filed before the
Registrar for settlement if it arises Â
(a) among members, past members and persons claiming through members and deceased members or then sureties; or
(b) between members, past member or a person claiming through a member, past member or deceased member representing through heirs or legal
representatives and the coÂoperative society, its board or any officer, agent or employees of the coÂoperative society or liquidator, past or present; or
(c) between the coÂoperative society or its board and any past board, 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 or deceased employee of the coÂoperative society; or
(d) between two coÂoperative societies or between a coÂoperative society and a liquidator of another coÂoperative or between liquidator of two
different coÂoperatives or between a coÂoperative society and any person having transaction with it or between a coÂoperative society and its
financing bank.
(2) Any dispute mentioned in subÂsection (1) other than a dispute relating to recovery of money shall be filed before the Registrar within three months
from the date on which the cause of action arises.
(3) Notwithstanding anything contained in this section or in any other law for the time being in force, the Registrar may admit any dispute after the
expiry of the period of limitation provided in subÂsection (2), if the applicant can show sufficient cause for not filing the dispute within such period of
limitation and the dispute so admitted shall not be barred by limitation.
(4) Any civil court or any Consumers' Dispute Redressal Forum shall not have any jurisdiction to try any dispute as mentioned in subÂsection (1).
(5) Any dispute to be filed before the Registrar shall be made in writing to be called the plaint and it shall be filed in such maner and form as may be
prescribed.â€
145.   Indemnity and bar to jurisdiction of courts.  (1) No suit, prosecution or other legal proceedings shall lie against the Registrar or any
person authorised by him or against a board of directors in respect of anything done or purported to be done in good faith under this Act.
(2) Save as provided in this Act, no Civil Court or Revenue Court or Consumer Disputes Redressal Forum shall have jurisdiction in regard to anything
done or any action taken or any order passed under this Act and, in particular, in regard to Â
(a) the registration of a coÂoperative society or its byÂlaws or an amendment of its byÂlaws; or
(b) the dissolution of the board of a coÂoperative society and the management of such coÂoperative society on such dissolution; or
(c) any matter concerned with dissolution or liquidation of a coÂoperative society;
(d) any dispute required to be referred to the Registrar under section 102.
(3) While a coÂoperative society is being dissolved, no suit or other legal proceeding relating to the affairs of such cooperative society shall be
proceeded with or instituted against the liquidator, or such coÂoperative society or any member thereof except by leave of the Registrar and subject to
such condition as the Registrar may impose.
(4) Save as provided in this Act, no order, decision or award made under this Act shall be challenged, set aside, modified, revised or declared void in
any court on any ground whatsoever except for want of jurisdiction.â€
A conjoint reading of the aforesaid provisions shows that when there is a dispute between a cooperative society and any person having transaction
with it, it could be resolved by approaching only the Registrar under the said Act and that the Civil Court has no jurisdiction to try such a dispute.Â
The jurisdiction of Civil Court is expressly barred on a proper reading of the aforesaid provisions.Â
A perusal of the impugned order in the present case shows that while analyzing the said provision in paragraph 5, the trial Court has committed an
obvious error in stating that the said provisions would not apply because the respondents were not members of the applicant/ Cooperative Society.Â
The words, “between a cooperative society and any person having transaction with it†have escaped the attention of the trial Court, which has
resulted in erroneous findings rendered by it.Â
The Special Bench of Calcutta High Court in the case of Anjan Choudhury .v. Anandaneer CoÂoperative Registered Housing Society and others
(supra) has considered a pari materia provision under Section 95 of the then existing West Bengal CoÂoperative Societies Act, 1983. Section 95(1)
(d) of the said Act of 1983 is similar to Section 102(1)(d) of the present Act of 2006, relied upon in the instant case. Section 134(2) of the West
Bengal CoÂoperative Societies Act, 1983, which was also considered by the Special Bench, is similar to Sections 102(4) and 145 of the said Act of
2006 quoted above. Upon consideration of the question, as to whether a suit was maintainable in respect of a dispute with a Cooperative Society
and whether plaint deserved to be rejected under Order 7 Rule 11 of the Code of Civil Procedure, the Special Bench of the Calcutta High Court in the
aforesaid judgment has held as under :Â
“22. This brings us to the case in hand where the promoters of a CoÂoperative Housing Society, before its formation and registration as such,
entered into a written agreement to purchase some land and having failed to obtain conveyance from the seller, instituted this suit in the Civil Court in
the name of the Society after the same was duly formed and registered. As would appear from the plaint and the Deed of Agreement, the land was
sought to be purchased for the CoÂoperative Society and for the avowed purpose (vide, Clause 2(c) of the Deed of Agreement) of constructing
houses thereon for allotment of apartments to the members. The dispute in this case therefore directly concerns the business and relates to the
affairs of the Society which is patently a Cooperative Housing Society and is therefore clearly a dispute within the meaning of Section 86(1) of the Old
and Section 95(1) of the new Act. The dispute also is one between a Cooperative Society and “any person having transactions†with the CoÂ‐
operative Society within the meaning of Clause (d) of Section 86(1) and the Clause (d) of Section 95(1) as aforesaid. The fact that the CoÂoperative
Society was not formally formed and registered when the Agreement was entered into is immaterial for the Society has already come into jural
existence when the suit was filed and the question of maintainability would obviously have to be decided on the state of affairs prevalent at the time
when the suit was instituted. The suit, therefore, could not be entertained by the Civil Court under the provisions of Section 132(2)(d) of the then
prevailing Act of 1973, now replaced by Section 132(2)(d) of the then prevailing Act of 1973, now replaced by Section 134(2)(d) of the present Act,
1983. The Court below was accordingly wrong in entertaining the suit and in holding that it had jurisdiction and that the plaint was not liable to be
rejected under the provisions of Order 7, Rule 11 of the Code of Civil Procedure and that the Court had jurisdiction to proceed with suit.â€
The facts in the present case show that in the plaint, in paragraphs 1 and 2, the respondents themselves have stated that the applicant No.1Â‐
Society was a Cotton Marketing Division, CoÂoperative Spinning Mill formed by and under the administrative control of Department of Micro and
Small Scale Enterprises and Textiles, Government of West Bengal, in the business of cotton bales and resale of them to different parties and
manufacturers. This itself shows that the respondents conceded to the fact that applicant No.1ÂSociety was in the business of sale and purchase of
cotton bales, which was subject matter of the dispute and the disputed transaction between the parties herein. As per settled law, while deciding an
application under Order 7 Rule 11 of the Code of Civil Procedure, the Court can only look at the plaint and the documents filed therewith. Perusal
of the plaint itself shows that the applicant No.1ÂSociety had indeed entered into the aforesaid business transaction with the respondents and that the
above quoted provisions of the said Act would apply to the facts in the present case.Â
In this backdrop, it is evident that the trial Court committed an error in appreciating the facts as well as the position of law in the context of the
provisions of the said Act, while holding that the suit filed by the respondents was maintainable and that the plaint could not be rejected.
On a proper reading of the facts of the present case and the provisions of the law quoted above, it becomes evident that the Civil Court in the
present case had no jurisdiction and that the trial Court ought to have allowed the application of the revision applicant and the plaint ought to have been
rejected.
Accordingly, this application is allowed. The impugned order passed by the trial Court is set aside. The application for rejection of plaint under
Order 7 Rule 11 of the Code of Civil Procedure filed by the applicants before the trial Court is allowed and the plaint is rejected. Needless to say
that the respondents may avail of the remedy under the provisions of aforesaid Act before the appropriate forum, wherein they may apply for benefit
under Section 14 of the Limitation Act for condonation of delay in approaching such forum. There shall be no order as to costs.