- (1.) A few legal questions which arise for consideration in this second appeal, in context with Section 70 of the U.P. Cooperative Societies Act, 1965, hereinafter referred to as the Act, are as to what constitutes a dispute relating to the business of a society as may be referable to the arbitration, and further as to whether an auction-purchaser of property in proceedings for realisation of dues standing against a member of the society would be a stranger to the arbitration proceedings or he would be one claiming through a member of the society. Yet another question is about notice which is required to be given under Section 117 of the Act to a cooperative society, before filing a suit in the Court of law.
(2.) Brief facts necessary for appreciating the questions which have arisen for consideration, are that plaintiffs Shri Pal and Siyaram had taken loan of Rs. 1200.00 from Rajya Sahakari Vikas Bank, Barabanki on 21-12-1965, pledging some plots of land, situate in village Shahpur, Pargana Deva, Tahsil Nawabganj, District Barabanki in security. It appears that the loan could not be repaid, hence a demand notice was served on Shri Pal demanding an amount of Rs. 1786.00, in realisation whereof the land of the appellants was auctioned in June, 1974 and it was also confirmed around the same period. Plaintiffs Shri Pal and Siyaram filed a suit for cancellation of the sale deed which was executed in favour of respondent No. 2. It may be mentioned here that respondent No. 2. Chhote Lal transferred the land to respondents Nos. 3 to 6. A number of pleas were raised by the parties which gave rise to nine issues framed by the trial Court in two stages, which may be quoted as below:(1) Whether the sale deed dated 27-11-1974 executed by defendant No. 1 in favour of defendant No. 2 in auction sale dated 3-6-1974/3-7-1974, is liable to be cancelled ? If so, its effect ?(2) Whether the suit is undervalued and the Court fee paid is insufficient ?6 (3) Whether the suit is bad for misjoinder of plaintiffs.(4) To what reliefs if any, are the plaintiff entitled ?(5) Whether the suit is undervalued and the Court fee paid is insuffcient ? (sic) (6) Whether this Court has no jurisdiction to entertain the suit as alleged in Para 10 of written statement filed by defendant No. 1 ?(7) Whether the suit is barred by the provisions of Land Mortgage Bank Act ?(8 ) Whether the suit is bad for want of notice under Section 117 of the U.P. Co-operative Societies Act ?(9) Whether defendant No. 1 realised a sum of Rs. 5025.00 by sale of crops of plaintiff as alleged in Para 4-A of the plaint ?Issues No. 6. 7 and 8 raise issues of legal nature. Issue No. 6 relates to the plea of the defendants that the suit was not maintainable in the Civil Court, since the dispute was covered by Section 70 of the Act. According to the defendants, the dispute relates to the business of the co-operative society, hence an arbitration would lie under the provisions of Sections 70 and 71 of the Act. The trial Court held that the matter was referable to the arbitration under Section 711 of the Act, hence suit was barred under the provisions of Section 111 of the Act. So far as issue No. 8 was concerned, it related to two-months notice prior to institution of a suit against a co-operative society as provided under Section 117 of the Act. This issue was decided in favour of the defendants and against the plaintiffs. Issue No. 7 was also decided in favour of the defendants whereby holding that in view of the provisions contained in Section 19 of the U.P. Co-operative Land Development Bank Act, a suit for damages alone would lie and the auction could not be challenged. It may also be mentioned here that on the basis of amended plaint, by inserting Para 4-A in the plaint, giving rise. to issue No. 9 was also dealt with by the trial Court, and it was held that the crop of the appellants was sold and a sum of Rs. 5025.00 was realised by the defendant Bank. It may not be relevant to mention here about the findings recorded on all the issues framed in the case. On the basis of the findings, however, recorded by the trial Court on different issues, the suit was dismissed by the judgment and order dated 30/05/1976.
(3.) Aggrieved by the judgment of the trial Court, the appellants preferred a first appeal, which too, was dismissed by the Ist Appellate Court by judgment and order dated 12-12-1978. The appellate Court upheld the finding of the trial Court about the bar of the suit as well as about the notice under Section 117 of the Act. So far the question of payment of Rs. 1786.59 p. by the plaintiffs and having obtained receipt of the same was concerned, that was not accepted by the Ist Appellate Court and the case of the plaintiffs in that regard had been found to be without force and the document which was relied upon by the plaintiffs was held to be suspicious. Thus the finding of the trial Court in respect of that matter had also been upheld. So far as the sale of the crop worth Rs. 5025.00 was concerned, the Ist Appellate Court observed that no such issue was framed; therefore, that aspect could not be looked into in appeal. This is how the appeal also stood dismissed.;