WRIT PETITION 867 of 2001 on 13 December 1999

JUDGMENT :

Petitioner, who is an opponent, before the Co-operative Court, Aurangabad, has questioned the order dated 20/10/2000passed by the Co-operative Appellate Court, Aurangabad in AppealNo. 119 of 1999, whereby the Co-operative Appellate Court hasdismissed the appeal of the present petitioner questioning the orderof the Co-operative Court dated 13/12/1999 in favour of therespondents on the maintainability of the dispute.

2. The facts as are necessary for deciding the issue are asunder :

Respondent No. 1 herein filed Dispute No. 438 of 1994under Section 91 of the Maharashtra Co-operative Societies Act,1960 (hereinafter shall be referred to as 'the Act' for sake of brevity)

867.01wp-3-

for possession of area 3' x 65' out of Plot No. 7 from C.T.S. No.

15737/7, particularly Plot No. 7-A.

3. In the said Dispute, it is claimed that Plot No. 7 was sold by respondent No. 2 society to one Mr. Tandulwadikar, who upon noobjection from the society, transferred it to the petitioner andrespondent No.1 each getting 50% share in the said plot.

4. It is claimed by respondent No.1 that the petitioner hasencroached to the extent of 3' x 65' on his portion and as such,sought possession.

5. An application questioning the jurisdiction of the Co-operative Court was moved by the present petitioner, which came tobe decided by learned Co-operative Court on 13/12/1999 holding thatthe dispute is since touching the business and management of thesociety, therefore, the Co-operative Court has jurisdiction as thedispute is within ambit of Section 91 of the Act.

6. An appeal to Maharashtra State Co-operative AppellateCourt, Mumbai, Bench at Aurangabad by the present petitioner beingAppeal No. 119 of 1999 suffered dismissal on 20/10/2000. As such,present petition.

7. Mr. Deshmukh, learned Counsel for the petitioner hastaken me through the provisions of Section 91 of the MaharashtraCo-operative Societies Act, 1960 and in the back ground of pleadingsmade in the Dispute has sought to urge that the dispute is betweentwo members of the society and has nothing to do with themanagement or business of the society. So as to support hiscontention, he has invited my attention to the pleadings raised in thedispute. According to him, both the Courts below i.e. Co-operativeCourt and Co-operative appellate Court have lost sight of the saidevent i.e. society once having given no objection for execution of thesale deed in favour of petitioner and respondent, the society hashardly any right, interest in the suit property. According to him, thedispute for which cause is between the petitioner and respondentand not in between the society and the petitioner was appreciated byboth the Courts below. In support of his contention, he has reliedupon the judgment of this Court in the matter of Belganda SahakariSakhar Karkhana Ltd. Bhoras Dist. Jalgaon vs. Keshav RajaramPatil reported in 1994(2) Mh.L.J. 1756 so as to draw support that thenature of dispute, is no way concerned the management or businessof the society. In addition to above, he has also relied upon thejudgment of this Court in the matter of Lokmitra Co-operativeHousing Society Ltd. Garkheda, Aurangabad vs. Yojna Co- operative Housing Society, Garkheda, Aurangabad reported in1991(1) Mh.L.J. 39.

8. Learned Counsel for respondent-society supports theorders passed by the Courts below and would urge that the orderspassed by the Co-operative Court and Co-operative appellate Courtare based on sound reasoning. In support of his contention, he hasplaced reliance upon the judgment of Apex Court in the matter ofR.S.D.V. Finance Co.Pvt. Ltd. vs. Shree Vallabh Glass Works Ltd.reported in AIR 1993 SC 2094 so as to submit that ouster ofjurisdiction of Co-operative Court cannot be interfered simplicitor.

9. Having considered the rival contentions of the parties, itis required to be noted that admittedly the petitioner and respondentNo.1 have purchased Plot No.7 each having 50% share out of total3150 sq. ft. There is no dispute that the said purchase by thepetitioner and respondent No.1 was upon no objection given byrespondent society. Said Plot No. 7 as such was divided into twoparts i.e. 7-A and 7-B each having area 1580 sq. ft. It is claimed byrespondent herein that the petitioner has encroached upon the plot ofrespondent to the extent of 3' x 65' and as such, sought possessionof the said property.

10. The respondent though in the dispute has come out witha prayer against respondent No.2 society and other respondents togive possession to the disputant of the above referred disputedproperty, however it is required to be noted that the respondent at nopoint of time was assured by the society about handing over ofpossession, particularly when the property was purchased by thepetitioner and respondent from one Mr. Tandulwadikar, who wasoriginal allottee and was in possession of the plot from the society.

11. Based on the above, the petitioner appears to haveraised objection about jurisdiction of the Court. The Co-operativeCourt while dealing with such objection and upon consideringsubmissions of the parties, has noticed 50% share of each of theparties which is an admitted position, Co-operative Court thenproceeded to pass order, which according to him, in the disputewhich pertains to touching business and management of the society,however, there are no reasons mentioned in the order in support ofsuch finding.

12. In an appeal preferred by present petitioner, the Co-operative appellate Court while dealing with the contention has takeninto account the above referred admitted position and uponconsidering the claim of the society in the written statement as

regards the original allotment to the Mr. Tandulwadikar, bifurcation ofthe plot, no objection by the society, noticed that main business of thesociety is to allot plots to its members and nature of prayer in thedispute pertains to encroachment on the plot allotted by the society.According to the Co-operative appellate Court, the said aspecttouches the business of the society and as such, rejected the appeal.

13. At the outset, in my opinion, both the Courts below havelost sight of important aspect of the matter i.e. original allottee Mr.Tandulwadikar was put into possession of the property Plot No. 7 byrespondent-society and who, upon no objection from the respondent-society, has sold it to the petitioner and respondent No.1. Thepetitioner and respondent No.1 though admitted that each of themhave 50% share in the said plot and respondent No.1 hasencroached to the extent of 65' x 3' on his plot, in my opinion is onlyafter the purchase of the property by the petitioner and respondentNo.1 from Mr. Tandulwadikar and not from the society. Mr.Tandulwadikar has taken no objection from the society for sale of theplot and as regards measurement of the share of each of the party isconcerned, in my opinion, each of the party i.e. the petitioner andrespondent No.1 will be required to establish the same before thecompetent civil Court, upon adducing the evidence on the saidaspect is not in regard to touching the business of the society. The

petitioner and respondent No.1 became members of the society afterpurchase of plot in question from Mr. Tandulwadikar and are notoriginal allottees. Apart from above, Mr. Tandulwadikar, the petitionerand and respondent No. 1 have not made any grievance aboutshortfalls in the measurement of the plot.

14. In my opinion, the cause that is sought to be espousedbefore the Industrial Court is neither touching the business of thesociety nor within ambit of the management of the society.Appropriate reliance can be placed upon the judgment in the matterof Belganda Sahakari Sakhar Karkhana Ltd. Bhoras Dist.Jalgaon (supra) to paragraphs-16 and 19 of the said judgment,which read thus :

“16. With the advantage of the aforesaid rulings at hand,one has, therefore, to conclude that the position of law asit boils down at present, is that the expression "anydispute" used in section 91(1) of the Act would mean adispute arising out of the provisions of the Act and not adispute which could arise independently of the provisionsof the Act. Consequently, therefore, when the dispute hasarisen between the society and a member about thematter which does out arise not of the provisionscontained in the Act, that would not fall within thejurisdiction of the Co-operative Courts.

19. Now, in the facts of the present case, the right of a member to contract with the society for the construction ofa godown building, is not a right created by the Act. Thatright is subject to the jurisdiction of Civil Courts undercommon-law. If that right is sought to be excluded, thereshould be an explicit provision in the statute whichpurports to accrue such a jurisdiction. In the present case,section 91 does not exclude explicitly from theconnotation of the term 'dispute' the civil rights arising infavour of a member, otherwise than under the Act.Therefore, the expression "any dispute", though used inthe section could not be ascribed a meaning so as toinclude therein the disputes regarding the rights arisingunder the common-law. The object of the Maharashtra co-operative Societies Act is not to create in itself a completeCode for regulating all the relations between the co-operative societies and the members but the object is toregulate such relations only in respect of the matterswhich are regulated by the Act. The Preamble of the Actreads thus,--- "WHEREAS, with a view to providing for the orderlydevelopment of the co-operative movement in the State ofMaharashtra in accordance with the relevant directiveprinciples of State policy enunciated in the Constitution ofIndia, it is expedient to consolidate and amend the lawrelating to Co-operative Societies in that State;...."

Thus the Act is intended to consolidate and amend thelaw relating to co-operative societies and not for thepurpose of regulating all the transactions, whether fallingwithin the purview of the common-law or the special statute, by the Legislation in question.”

15. Apart from above, appropriate support can be drawn from the judgment of this Court in the matter of Lokmitra Co-operative Housing Society Ltd. Garkheda, Aurangabad (supra),particularly paragraph-11 of the said judgment, which reads thus :

“11. The learned advocate for the respondent in thisbehalf has urged that the problem should be viewed inthe following background.

Here is a case where the plaintiff/society has claimedtitle over the plot allotted to it for which there is aproperty card. The defendant/society objected to theplotting on the land of the plaintiff/society on the groundthat, land was allotted to the defendant/society. This is adispute which relates to the title which is beingchallenged by the defendant/society. This is a questionwhich relates to the rival title set up by both the societiesand such question does not at all come within the phrase'business of the society' The word 'business' withreference to the affairs of the society has been definedas the business of the society viz. activities of thesociety. Such business can be spelt out from the sectionof the Act, the Rules framed under the Act and the bye-laws of the society. In this behalf no bye-laws areproduced and the learned advocate for the petitionerrelied on the above definition of the housing society andthat, if provision is looked into, it only provides for allotment of plots and providing common amenities. Thebusiness of the housing society does not at all envisagethe question of rival title against the other society. In thatbehalf, section 91, sub-section (1) sub-clause (c) will notcome into operation at all. This is a case where theplaintiff is seeking title over the same plot over whicheven the defendant/society lays claim. By no stretch ofimagination, it can be contended that the question of titleover a plot would fall within the purview of 'disputerelating to business of the society'. Disputes regardingtitles to properties between societies or erosion of anyrights or inflicting encroachments by one society over theother or like disputes between third party and the societywould certainly not fall within the scope of the phrase"dispute touching the business of the society". Suchdisputes shall have to be resolved by the Civil Courtsand none else.”

16. In view of above, in my opinion, the petitioner wasjustified in raising objection that the Co-operative Court has nojurisdiction to try and entertain the dispute in question, particularlywhen same is not touching the business and management of thesociety. Apart from above, the encroachment as alleged by onemember on the property of another member, after the execution ofsale deed in any case could be dispute between two members of thesociety and not touching the business of the society.

17. As such, for the reasons stated herein above, the writ petition stands allowed. The order dated 20/10/2000 passed by theMember, Maharashtra State Co-operative Appellate Court, Mumbai,Bench at Aurangabad in Appeal No. 119 of 1999 is set aside andAppeal No. 119 of 1999 stands allowed. It is declared that the Co-operative Court has no jurisdiction to try and decide Dispute No. 438of 1994.

18. Rule is made absolute in above terms.

[ N.W. SAMBRE, J. ]

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