S.N. Dwivedi, J. - (1.) CONSUMERS Cooperative Stores, Ltd., Agra, (hereinafter called the Stores), a Cooperative Society registered under the Cooperative Societies Act, 1912, (hereinafter called the Act of 1912) consists of 1500 members. At the relevant time one Gyan Chand was its Accountant and Balmukund Balla, a party to the revision its Manager. A criminal case was started against the Accountant for the misappropriation of the Stores' funds and during the pendency of the case, on an application by 29 members for appointing an arbitrator to decide certain matters relating to Gyan Chand's misconduct, which allegedly constituted the dispute between the Stores on the one side and its Governing Body and the Manager on the other side, the Registrar, Cooperative Societies, U.P. appointed Sri S.P. Bhatnagar, Deputy Registrar, Cooperative Societies, U.P. as the arbitrator. Thereupon the Manager asked the trial court to proceed under Section 33 of the Arbitration Act, 1940 (hereinafter called the Act of 1940) against the arbitrator. The trial court held that the reference of the dispute to the arbitrator was invalid because the subject -matter of the dispute went outside the scope of Rule 115 of the Cooperative Societies Rules (herein below called the Rules) and that order of the court is challenged in this revision under Section 116 Code of Criminal Procedure.
(2.) SRI T.N. Sapro, in his able arguments, vigorously maintained that Section 33 of the 1 Act of 1940 did not apply to the arbitrations under the Act of 1912 and the trial court had exercised a jurisdiction not vested in it by law. He sought to support his argument by the Rules and some specific cases. At this stage it would be necessary to set out the pertinent provisions of the Act of 1940: Section 32 - -Notwithstanding any law for the time being in force, no suit shall lie on any ground whatsoever for a decision upon the existence effect or validity of an arbitration agreement or award, nor shall any arbitration agreement or award be set aside, amended, modified or in any way affected otherwise than as provided in this Act. Section 33 - -Any party to an arbitration agreement or any person claiming under him desiring to challenge the existence or validity of an arbitration agreement or an award or to have the effect of either determined shall apply to the court and the Court shall decide the question on affidavit. Section 46 - -The provisions of this Act except Sub -section (1) of Section 6 and Sections 7, 12 and 37, shall apply to every arbitration under any other enactment for the time being in force, as if the arbitration were pursuant to an arbitration agreement and as if that other enactment were an arbitration agreement, except in so far as this Act is inconsistent with that other enactment or with any rules made thereunder. Section 47 - -Subject to the provisions of Section 46 and save in so far as is otherwise provided by any law for the time being in force, the provisions of this Act shall apply to all arbitrations and to all proceedings thereunder: The conjoint effect of Sections 32 and 33 is to substitute for the ordinary remedy by a suit the cheaper and speedier remedy by an application for determining the existence, effect or validity of an arbitration agreement or award. The word 'effect' in those sections means scope, tenor or drift see Bairang Lal v. Agarwal Brothers : AIR 1950 Cal. 267 and Gordhandas Pursottam Sonawala v. Natwarlal Chandu Lal : AIR 1952 Bom. 349 and the trial court could have jurisdiction to determine the scope of the arbitration agreement embodied in Rule 115 if Section 33 is not inconsistent with the Act of 1912 and its Rules. In our view the true test for determining that they are mutually inconsistent is whether they cannot co -exist and co -operate in the domain of co operative arbitration. In Tabernacle Permanent Building Society v. John Knight, 1892 AC 298 during the arbitration proceeding between the Appellant Building Society and the Respondent, one of its members, before the arbitrator appointed under Section 34, Building Societies Act, 1874, the Respondent, on the arbitrator's refusal to state a special case for the opinion of the Court on a point of law, obtained from the Court under Section 19, Arbitration Act, 1899, a direction to him to do so on appeal the Court's order was set aside on the view that Section 19 was inconsistent with the former Act and the Court had no power to issue the direction. The matter eventually reached the House of Lords, who affirming the Court's order, held that Section 19 was not inconsistent with the Building Societies Act. Lord Watson said, The Appellants were accordingly constrained to argue that, whenever the provisions of the Arbitration Act are found to add to the enactments of any other statute regulating arbitrations, they are in the sense of the exception inconsistent with it. To hold that the Legislature intended to attach that meaning to the word 'inconsistent' would be to defeat the object of the leading enactment in Section 24. In my opinion the object of the Legislature was to add to the remedies open to the parties under a statutory arbitration and the sole purpose of the exception was to prevent the application of the powers conferred upon the Court by the Act of 1889 to arbitrations under any statute whose provisions either expressly or by reasonable implication, excluded the exercise of such powers.
(3.) LORD Herschell express himself thus: The Arbitration Act which confers upon the Court the power to order a case to be stated, if it applies, adds, no doubt, to the provisions which are to govern an arbitration under the Building Societies Act; but it is clear that the fact that the provision is an additional one does not of itself show that there is any inconsistency in the two Acts, for if so, the 24th section would never have any operation. I think the test is, whether you can read the provisions of the latter Act into the earlier without any conflict between the two. This you can clearly do as regards the enactment under consideration.;