The Non-Gazetted Government Employees Co-operative Building Society Limited vs K. Radhakrishna Murthy

Motilal B. Naik, J.—This revision-petition is directed against the order dated 9-11-1989 in E.A. No. 1076/88 in E.P. No. 578/87 in O.S. No. 1338/84 on the file of the Additional District Munsif, Vijayawada.

Petitioner is the defendant in the suit, O.S. No. 1338/84, filed by the respondent. The suit was for recovery of Rs. 7,328/-, being the balance amount deposited by the respondent-plaintiff, along with interest. Petitioner is the Non-Gazetted Government Employees Co-operative Building Society Limited, Vijayawada. The object of the petitioner-society is to carry on for the benefit of its members the trade of buying and building, selling, hiring and developing of lands in accordance with the co-operative principles and to give loans to its members for construction of new dwelling houses. Respondent is one of the members of the petitioner-society and he was allotted a plot bearing No. 18 situated at Shyamnagar, NGOs colony, Labbipet, Vijayawada. As per bye-law No. 28 (d) of the society, the society has to sue or be sued represented by its President. In this case, the respondent-plaintiff though was aware of the bye-laws deliberately filed the suit against the society represented by its Secretary, instead of President. The Secretary, one Venkateswara Reddy, seems to have colluded with the respondent-plaintiff after filing the written statement and remained ex parte permitting the decree to be passed. The Court below passed the decree on 31-7-1987 hearing the learned Counsel for the respondent-plaintiff - the petitioner/defendant having been set ex parte.

While so, the respondent-plaintiff having obtained ex parte decree filed E.P.No. 578/87 before the I Additional District Munsif''s Court, Vijayawada. At that stage, the petitioner-society, being represented by its President, filed an application -E.A.No. 1076/88 -under Section 47 of the CPC for a declaration that the decree passed on 31-7-1987 is null and void, inexecutable, unenforceable and without jurisdiction. The ground urged by the petitioner-society before the Court below was that in terms of Section 61 (b) of the A.P. Co-operative Societies Act, any dispute between a member and the society is to be referred to the Registrar of the Co-operative Societies and that the dispute should be decided only by the Registrar and not by any other forum. It was further contended that the dispute between the respondent-plaintiff and the petitioner-society is one in the nature relating to the management and business of the society and, therefore, Civil Court is barred from entertaining suits to resolve the controversy which is directly hit by Section 61 (b) of the Co-operative Societies Act.

At paragraph 6 of the written statement filed by the petitioner-society though a plea had been set up by the petitioner-society Ghat the Court had no jurisdiction to entertain the suit, the Civil Court ignored the fact and decreed the suit. It was under these circumstances, the petitioner-defendant sought a declaration in the E. A. that the decree passed on 31-7-1987 in O.S.No. 1338/84 is null and void, inexecutable, unenforceable and without jurisdiction. The executing Court rejected the application holding that at the stage of execution proceedings, it is not open to the petitioner-defendant to raise the said plea, as it was estopped from doing so and that the said plea was raised in the suit itself before the trial Court and the same was already rejected.

Under this background, the only question that falls for consideration in this revision petition is whether the executing Court is proper in rejecting the application filed u/s 47 of the CPC seeking to declare the decree dated 31-7-1987 passed in OS. No. 1338/84 is null an void, without jurisdiction and unenforceable?

Sri E. Manohar, learned Counsel for the petitioner-society, has taken me through few decisions pointing out that when Courts lack jurisdiction to entertain a suit and even then entertained the suit, it is always open to the party to agitate this aspect even in execution proceedings and, therefore, the executing Court is not right in rejecting the application filed u/s 47 CPC.

In Kiran Singh and Others Vs. Chaman Paswan and Others, it was held:

"It is a fundamental principle that a decree passed by a Court without jurisdiction is a nullity, and that its invalidity could be set up whenever and wherever it is sought to be enforced or relied upon, even at the stage of execution and even in collateral proceedings. A defect of jurisdiction, whether it is pecuniary or territorial, or whether it is in respect of a subject-matter of the action, strikes at the very authority of the Court to pass any decree, and such a defect cannot be cured even by consent of parties."

In Sunder Dass Vs. Ram Prakash, the Supreme Court dealing with Section 47 CPC, executability of a decree and duty of the executing Court, held:

"An executing Court cannot go behind the decree nor can it question its legality or correctness. But there is one exception to this general rule and that is where the decree sought to be executed is a nullity for lack of inherent jurisdiction in the Court passing it, its invalidity can be set up in an execution proceeding. The executing Court can, therefore, entertain an objection that the decree is a nullity and can refuse to execute the decree. By doing so, the executing Court would not incur the reproach that it is going behind the decree, because the decree being null and void, there would really be no decree at all."

In R.S. Sunder Rao v. Gandipuram Co-operative Building Society, 1983 (2) APLJ 14 (S.N.) a learned single Judge of this Court dealing with Section 9 C.P.C. and Section 61 of the A.P. Co-operative Societies Act held:

"Under Section 61 (1) of the Act (A.P. Co-operative Societies Act) the language couched was "notwithstanding anything in any law for the time being in force". Thereby the legislature intended that the jurisdiction to adjudicate the dispute between the member or a person claiming through a member and the society, which normally could have been taken cognizance of by the Civil Court, is now lifted out and entrusted to a tribunal has to be constituted under the Act."

By virtue of the provisions contained in Section 61 (1), the Civil Court ceases to have jurisdiction to take cognizance of the dispute. Admittedly, the dispute is falling within the ambit of Section 61, as it is touching the Constitution, management or business of the petitioner-society. Therefore, Section 61 abundantly makes it clear that Civil Courts are barred from entertaining a suit. It is also to be seen that at paragraph 6 of the written statement filed by the petitioner-society in the suit, a plea to that effect was specifically taken.

Unfortunately, the trial Court did not take into consideration that aspect. The defendant remained absent when the case was called and, therefore, he was set ex parte and the decree was passed. The trial Court has not bothered to see whether it had jurisdiction to pass the decree. The allegation of the petitioner-society all through was that the respondent-plaintiff filed the suit against the society making the Secretary as representing the society and that the Secretary and the plaintiff colluded together and obtained a decree by fraud. It was, therefore, obligatory on the part of the trial Court, when specific plea was taken in the written statement, to consider that aspect and pass appropriate orders as to the maintainability of the suit. When the petitioner-society made efforts before the executing Court by way of an application u/s 47 CPC raising all the issues therein, the executing Court failed to advert itself to the issue and rejected the application holding that it cannot go behind the decree and that the petitioner-society was estopped from raising such a plea.

On behalf of the respondent-plaintiff, Sri P. Ramachandra Reddy contended that the executing Court was right in rejecting the application, as it cannot go behind the decree. In support of his contention, the decision of the Supreme Court in Vasudev Dhanjibhai Modi Vs. Rajabhai Abdul Rehman and Others, was relied on. A reading of this decision discloses that the proposition laid therein would assist the petitioner-society rather than the respondent-plaintiff. In that case, the Supreme Court observed:

"When the decree is made by a Court which has no inherent jurisdiction to make it, objection as to its validity may be raised in an execution proceeding if the objection appears on the face of the record. But where the objection as to the jurisdiction of the Court to pass the decree does not appear on the face of the record and requires examination of the questions raised and decided at the trial or which could have been but have not been raised, the executing Court will have no jurisdiction to entertain an objection as to the validity of the decree even on the ground of absence of jurisdiction."

What follows from the above decision is that an objection as to the jurisdiction does not appear on the face of the record and requires examination of that question first time before the executing Court, the executing Court need not go into that aspect, that is to say, when an objection has been taken but has not been decided in the first instance on the question of maintainability, which is apparent on the face of the record, the executing Court can take upon to examine that objection. In the instant case, at paragraph 6 of the written statement filed in the suit before the trial Court, a specific plea was taken that the Court had no jurisdiction. Therefore, that factor is apparent on the face of the record and the executing Court ought to have taken upon to examine the question as to the maintainability of the suit filed before the trial Court.

Section 61 of the A.P. Co-operative Societies Act takes away the jurisdiction of the Civil Court to entertain proceedings before it in a dispute touching the constitution, management or business of the society other than a dispute regarding disciplinary action taken by the society or its committee against a paid-employee of the society. Respondent-Plaintiff is a member of the society and seeks recovery of money deposited in connection with house building activity. The object of the petitioner-society is to carry on for the benefit of its members the trade of building and buying, hiring, selling and development of lands in accordance with the co-operative principles and to give loans to its members for construction of new dwelling houses. Thus the dispute is linked with the granting of loans, construction of houses and collection of money in that connection, which would fall within the objective activity of the petitioner-society and traceable to Section 61 of the Co-operative Societies Act. Therefore, I have no hesitation to hold that the Civil Court is barred from entertaining the suit filed against the petitioner-Society.

For all the above reasons, the order dated 9-11-1989 in E.A.No. 1076/88 in E.P.No. 578/87 in O.S.No. 1338/84 is set aside. Consequently, the decree dated 31-7-1987 in O.S.No. 1338/84 is set aside by declaring the same as null and void and unenforceable. However, it is open to the respondent-plaintiff, if he is advised to do so, to take recourse to such action which he is entitled to under law, for redressal of his grievance.

The revision petition is accordingly allowed. No order as to costs.