JUDGEMENT
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(1.)THE Gandhar Agricultural Co-operative Service Society. Gandhar (hereinafter referred to as the respondent-Society), filed a petition for execution of the award given by an Arbitrator under the Punjab Co-operative Societies Act, 1961 (hereinafter referred to as the Act), in the Court of the learned Subordinate -Tudge. l st Class. Muktsar. The appellant filed objections that the execution of the award was barred by time and the award having been given without notice to him was a nullity and as such incapable of being executed. On April 25 1972. the learned Subordinate Judge framed the following issues:- (1) Whether the notice of the proceedings of the arbitration, was not served on Ran Singh. If so. its effect. O. P. O. (2) Whether such an objection is not maintainable in these proceedings ? O. P. D. H. On June 19. 1971 the following additional issues were framed: - (3) Whether Section 22 of the Cooperative Societies Act is applicable to the execution of the award 1 O. P. O. (4) Whether the execution proceedings of the decree-holder is time-barred in view of Section 22 of the Co-operative Societies Act ? O. F O. (5) Relief. The learned Executing Court held that notice for the service of Ran Singh appellant had been sent by registered post by the arbitrator and the presumption was that the same had reached the destination and had been delivered to the addressee. On Issue No. 2. it was held that such an objection was entertainable in execution proceeding:. Issues Nos. (3) and (4) were found against the appellant and the execution proceedings were ordered to proceed The appellant filed an appeal before this Court against the order dated March 9. 1972. passed by the learned Subordinate Judge. 1st Class. Muktsar. This appeal came up for hearing before a learned Judge of this Court sitting in Chambers before whom it was argued that the appellant had not been served regarding the arbitration proceedings and that the award given by the arbitrator, being opposed to the principles of natural justice, was a nullity and incapable of being executed. The learned Judge held that the arbitrator had fixed the arbitration proceedings for May 9. 1966. and had sent a notice per registered post about this date to the appellant; subsequently the arbitrator changed the date of hearing from Mtw 9. 1966 to MAY 7. 1966 and sent another notice in this behalf, but the latter notice was not served on the appellant because he was not available; and in spite of the fact that the apoellant had not been served to appear before the arbitrator on 7-5-66 the latter took uo the case and passed an award against him burdening him with a liability to pay Rs 15. 262. 29 P. On the question whether the award, which had been passed in contravention of the principles of natural justice the learned Judge relied upon Sunder Singh v. The Central Cooperative Bank. 1973-75 Pun LR 678 = (AIR 1973 Puni 417 ). decided by a Division Bench of which he himself was also a member, and held that the award was not a nullity Consequently, he dismissed the appeal of the appellant but left the parties to bear their own costs.
(2.)THE Letters Patent Appeal filed by the appellant came up before a Bench consisting of my Lord the Chief Justice and myself on May 20. 1974. It was brought to our notice that there was an apparent conflict between the Division Bench judgment in Sunder Singh's case, AIR 1973 Punj 417 (supra) and another Division Bench judgment in The Lok Sewak Co-operative Marketing-cum-Processing Society, Faridkot v. Janga Singh, 1974 Pun LJ 5. In order to resolve the conflict between the two Division Bench judgments, the case was admitted for hearing by a Full Bench and it is for this reason that this case has come up for hearing before us.
(3.)AT the very outset. I would like to notice some of the relevant provisions of the Act and the rules framed there-under Section 55 of the Act lays down that notwithstanding anything contained in any law for the time being in force, a dispute touching the business of a co-operative society arising between a member and the society shall be referred to the Registrar for decision and no Court shall have jurisdiction to entertain any suit or other proceedings in respect of such a dispute Section 56 lays down that the Registrar on receipt of the reference of the dispute under Section 55. may either decide the dispute himself or transfer it for disposal to any person who has been invested with powers in that behalf or refer it for disposal to an arbitrator. In exercise of powers conferred under Section 85 of the Act, the State Government have framed the Punjab Co-operative Societies Rules. 1963 (hereinafter referred to as the Rules ). Chapter VII of the Rules consists of rules 51 to 57 relating to the settlement of disputes. Rule 51 lays down that a party desiring to have the dispute determined in accordance with Section 55 of the Act shall apply to the Registrar in writing stating the substance of the dispute and the names and addresses of the other party in such form as the Registrar may lay down from time to time. Rules 53 and 55, which are Particularly noteworthy, read as tinder:-
" 53. Communication of date, time and place of hearing. In, an arbitration proceeding, the Registrar, or the arbitrator, as the case may be, shall communicate the date, time and place of hearing the dispute to all the parties concerned. "
"55. Hearing of Disputes.--The Registrar or the arbitrator, as the case may be. shall hear the parties and witnesses who attend. On the basis of such evidence and after consideration of any documentary evidence that may be produced by either party, he shall give a decision or award, as the case may be, in accordance with justice. equity and good conscience. The decision or award shall be reduced to writing, announced to the parties and filed in the office of the Registrar. In the absence of any party duly summoned to attend, the dispute may be decided ex parte. "
A combined reading of these rules shows that the rule-making authority has provided for a definite procedure to be adopted in arbitration proceedings. A party desirous of having the dispute settled has to apply to the Registrar stating the substance of the dispute and other particulars in a prescribed form. If the Registrar himself chooses to act as an arbitrator or appoint an arbitrator, he or the arbitrator, as the case may be. is required to communicate the date, time and the place of hearing of the dispute to the parties concerned. The parties to the dispute have been invested with a right to be heard and to examine witnesses in support of their respective claims. The Registrar or the arbitrator has to Rive a decision or an award on the basis of evidence, both oral and documentary, in accordance with justice. equity and good conscience. The award has to be reduced to writing and announced to the parties. The important words in Rule 55 are "in the absence of any party duly summoned to attend, the dispute may be decided ex parte". In short, there is a clear mandate of the Subordinate Legislature that the dispute may be decided in the absence of a party only if it fails to appear before the Registrar or the arbitrator after being duly summoned to attend. Rule 57 lavs down that the record of the arbitration proceedings shall be preserved under the direction of the Registrar and any of the parties to the case shall be entitled to obtain copy of the decision or award on payment of prescribed fees.