MULTI PURPOSE CO OPERATIVE SOCIETY LTD Vs. NARAYANAN NAIR
HIGH COURT OF KERALA
MULTI-PURPOSE CO-OPERATIVE SOCIETY LTD.
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(1.) On both the questions involved in this second appeal the lower courts have reached divergent conclusions. The Trial Court has held that the suit is maintainable, while the lower appellate court has held that it is not: the Trial Court has held that Ext. P1 and P 3 have to be set aside, while the lower appellate court has held that they are not liable to be set aside.
(2.) Ext. P1 is a gift deed executed by the second defendant, who was the president of the appellant (a multi purpose cooperative society), in favour of the first defendant's father, S. J. Nair, conveying the suit property in favour of the latter for conducting a school. Ext. P2 is an agreement of the same date executed by S. J. Nair in favour of the second defendant undertaking to conduct the school and if he failed to start the school within two years, agreeing to give back the property to the appellant. Ext. P2 contains some other provisions as well. The suit has been brought by the cooperative society for recovery of possession of the property alleging that the second defendant had no authority to make a gift of the same; and even if he had authority by reason of an authorisation by the cooperative society, still, the conveyance was void, as written sanction for the conveyance was not taken from the Registrar of Cooperative Societies. The defence of the first defendant was that the suit was not maintainable as the dispute was one which should have been referred to arbitration by the Registrar; and that Ext. P1 was valid, as it was within the competence of the cooperative society. The two questions already indicated by me have been considered and decided by the lower courts as indicated above.
(3.) The first question for me to consider is whether the suit is not maintainable. That depends on the question whether the transaction under Ext. P1, which has given rise to the dispute, was one touching the business of the cooperative society. The Subordinate Judge says that under bye law 2(9) (Ex. C 1 is a copy of the bye laws) one of the purposes of the cooperative society was to conduct a school as well. The said bye law states that one of the purposes of the society was to do everything for the commercial, economic, moral and social advancement of the members of the society. The reasoning of the Subordinate Judge is that starting and conducting a school is for the moral and social advancement of the members of the society, so that the starting of a school was also one of the purposes for which the cooperative society was started. I am afraid that this reasoning cannot be accepted. The other sub clauses of bye law 2 enumerate several purposes like giving credit to the members of the society, procuring good types of seeds, manure and agricultural implements for the use of the members, helping the members in handloom and coir small scale or village industries, etc. Clause (9) of this bye law, in my opinion, is difficult of an interpretation that starting and conducting a school was also one of the purposes of the cooperative society.;
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