Bombay High Court
Jijamata Sahakari Sakhar Karkhana vs Sukhedeo Ramhau Fulzade on 16 July, 2010
Author: A.P.Bhangale
Bench: A.P.Bhangale
1
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT NAGPUR, NAGPUR.
SECOND APPEAL NO: 92 / 1999
Jijamata Sahakari Sakhar Karkhana
Ltd. Dusarbid Through Its Managing
Director, Dusarbid Tah.Sindkhed
(Raja), Dist. Buldana. ... ...APPELLANT
v e r s u s
1) Sukhedeo Ramhau Fulzade
Aged about 50 years, occu: Business
R/o Chikhli Tq.Chikhli
Dist. Buldana
2) Vishwanath Bandu Deshmane
Aged about 50 years, occu: Business
R/o Chikhli Tq.Chikhli
Dist. Buldana. ...RESPONDENTS
............................................................................................................................
Mr S D Desai, Adv.h/for Mr P B Patil, Advocate for appellant
Mr. J J Chandurkar, Advocate for Respondent No.1
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CORAM: A.P.BHANGALE, J.
DATED : 16th July, 2010
JUDGMENT :
This Appeal is at the instance of unsuccessful defendant, a registered Co-operative society, challenging the judgment and order dated dated 14.2.1994 passed in Regular Civil Appeal No. 113/1994 arising out of dismissal of Regular Civil Suit No. 39/1991 by the Court ::: Downloaded on - 09/06/2013 16:09:27 ::: 2 of learned Civil Judge, J.D. Chikhli.
2. The plaintiff had instituted the suit in the Court of learned Civil Judge, J.D. Chikhli, Dist. Buldana, to recover a sum of Rs.
15,828/- from the Jijamata Sahakari Sugar factory, on the ground that it was part of its business to supply sugarcane for the purpose of sowing (Bene) to the farmers and to accept sugarcane for the purpose of production of sugar. The plaintiff had, therefore, appointed some trucks for the transportation of sugarcane from the field of farmers to the factory or to supply sugarcane for farmers for sowing purposes. The subordinate office of the defendant society at Chikhli had called tender to appoint trucks pursuant to which the plaintiff was appointed to supply sugarcane for sowing to places like, Mera, Dhad , Utarapeth for a consideration of Rs. 350/- per day as the truck charge and the society agreed to bear other charges - like diesel, oil etc. within one month after completion of work.
3. The plaintiff performed his part of contract during the period between 2.2.1988 and 29.9.1988 by using his truck MWD 7270, for which sum of Rs. 11,880/- became due from the defendant society. The dues remained unpaid despite notice dated 10.6.1988 by registered post. Thus, the plaintiff sued the defendant to recover sum ::: Downloaded on - 09/06/2013 16:09:27 ::: 3 of Rs. 15,828/- along with future interest at the rate of 12 per cent per annum till full realisation thereof.
4. The defendant had resisted the suit on the ground that the suit was not competent for want of pre-suit statutory notice as required under section 164 of the Maharashtra Cooperative Societies Act ,1960 ( in short, "the Act of 1960") and, therefore, trial Court could not have entertained it.
5. The Appeal was admitted on 28.11.2000. The substantial question of law is as to whether Civil Court had jurisdiction to entertain the Civil Suit instituted against the Co-operative Society without pre-suit statutory notice, as required under section 164 of the Act of 1960.
6. Heard submissions at the Bar and perused the records.
7. Learned counsel for appellant placed reliance upon Section 164 of the Act of 1960 which reads thus :
No suit shall be instituted against a society, or any of its officers, in respect of any act touching the business of the society, until expiration of two months next after notice in writing has been delivered to the Registrar or left at his office, stating the cause of action, the name, description and place of residence of the plaintiff and the relief which he claims, and the plaint shall contain a statement that such notice has been so ::: Downloaded on - 09/06/2013 16:09:27 ::: 4 delivered or left."
It is clear from the provision of Section 164 of the said Act that it is prohibitory in terms that no suit can be instituted against a society or any of its officers in respect of any act touching the business of the society until pre-suit statutory notice in writing has been delivered to the Registrar of left at his office stating ;
(i) the cause of action for the proposed suit;
(ii) name, description and place of residence of the plaintiff;
(iii) the relief which the plaintiff claims.
Furthermore, the plaint shall contain a statement that such notice has been so delivered or left. Such notice though mandatory is capable of being express or implied waiver. The requirements stated above are mandatory and for the benefit of Cooperative society or its Officers to be sued in respect of any act touching the business of society.
8. The mandatory requirements of Section 164 of the said Act serves policy of law and a public purpose to protect Cooperative ::: Downloaded on - 09/06/2013 16:09:27 ::: 5 Societies from expensive; avoidable and lengthy litigation. The object of pre-suit statutory notice is to alert the noticee-society about the proposed suit so that it may through its responsible officer reply to the notice with a view to avoid litigation or to negotiate just settlement or, at least, have courtesy to tell the prospective plaintiff as to why his claim is being resisted. It is frequently experienced that noticees entitled to pre-suit statutory notices according to law in such cases are often unresponsive and render the salutary provision an empty ritual by their sheer inaction. Three Judge Bench of the Apex Court in the case of Salem Advocates Bar Association,Tamid Nadu vs. Union of India : (2005) 6 SCC 344, while making observation about requirement of pre-suit statutory notice under section 80 of C.P. Code held that the notice period of two months have been provided so that Government shall examine the claim put up in the notice and has sufficient time to send a suitable reply. The underlying object is to curtail the litigation; area of dispute and controversy. Wherever the statutory provision requires service of notice as a condition precedent for filing of the suit and observing prescribed period thereof, noticee concerned is expected to deal with it, so as to send reply. The provision casts an important and implied duty upon the noticee concerned to ::: Downloaded on - 09/06/2013 16:09:27 ::: 6 send an appropriate reply to such notice. The Apex Court in Salem Bar Association's case ( supra ) directed thus:
"Having regard to the existing state of affairs, we direct all concerned Governments, Central or State or other authorities whenever any statute requires service of notice as a condition precedent for filing of suit or other proceedings against it, to nominate within a period of three months, an officer who shall be made responsible to ensure that replies to notices under section 80 or similar provisions are sent within a period stipulated in a particular legislation. The replies shall be sent after due application of mind.
Despite such nomination, if the Court finds that either the notice has not been replied or reply is evasive and vague and has been sent without proper application of mind, the Court shall ordinarily award heavy cost against Government and direct it to take appropriate action against concerned Officer including recovery of costs from him".
9. The full Bench of the Bombay High Court in Vasant Ambadas Pandit vs. Bombay Municipal Corporation and others: AIR 1981 Bombay 394, held that .... " in our opinion, the true legal ::: Downloaded on - 09/06/2013 16:09:28 ::: 7 position in this behalf is that no suit can be instituted without service of the notice if such service of the notice is required statutorily as a condition precedent. The giving of notice is a condition precedent to the exercise of jurisdiction. "Pre-suit statutory notice is mandatory but it is capable of being lawfully waived by the party-defendant as it is procedural requirement but undoubtedly, the waiver has to be established by the plaintiff and once the plea of waiver raised by the plaintiff is tried and proved, then upon such waiver the civil court gets jurisdiction to entertain and try the suit. A party defending such suit which is instituted without service of pre-suit statutory notice has right to object at earliest opportunity that the suit could not have been instituted without the mandatory compliance of statutory requirements.
On this premise, it is choice of the defendant to raise preliminary objection as to jurisdiction of the court to entertain the suit or to waive the objection of procedural requirement by continuing to participate in the suit by filing written statement, adjournment application etc. and otherwise participating in the further continuation of proceedings in the suit. If the defendant continue to participate in the suit without enforcing his right to object to the institution of the civil suit filed without compliance of requirement of the pre-suit statutory notice, the ::: Downloaded on - 09/06/2013 16:09:28 ::: 8 defendant's conduct of continuance with the suit and participation therein may be established as "deemed waiver" of procedural requirement of the pre-suit statutory notice and, on that basis, when the "waiver" is proved by the plaintiff, the trial Court may proceed to decide the suit on merits. It is well known that due to an ever-
increasing pendency of the litigation a Civil Suit takes years for its final decision on merits. In such a case,the plaintiff may be left remediless and even if remedy is available, may have to start litigation/ suit afresh if rigid view is taken. It would also result in huge waste of energy, time and money. Therefore, Section 164 of the Act of 1960 may be construed as derogable provision if the party defendant in such suit by its conduct of continuance of participation in the suit allow the plaintiff to plead and establish "deemed waiver" of pre-suit statutory notice, then Civil Court may record finding as to its jurisdiction to entertain the suit and proceed to decide the suit on merits because civil court can try all suits unless barred expressly or by implication.
Ouster of jurisdiction is not to be readily inferred. Even in case jurisdiction is barred by any statutory provision court of plenary jurisdiction has power to decide its own jurisdiction by recording a finding as to jurisdictional fact. In this regard, in Dwarka Prasad ::: Downloaded on - 09/06/2013 16:09:28 ::: 9 Agrawal (D) by LRs and another vs. Ramesh Chander Agrawal and others: (2003) 6 SCC 220, the Apex Court observed, .........The dispute between the parties was eminently a civil dispute and not a dispute under the provisions of Companies Act. Section 9 of the Code of Civil Procedure confers jurisdiction upon all civil courts to determine all disputes of civil nature unless the same is barred under a statute, either expressly or by necessary implication. Bar of jurisdiction of Civil Court is not to be readily inferred. A provision seeking to bar jurisdiction of a Civil Court requires strict interpretation. The Court, it is well-settled, would normally lean in favour of construction, which would uphold retention of jurisdiction of the Civil Court ..."
In United India Insurance Co. Ltd. vs. Ajay Sinha and another:
(2008) 7 SCC 454 in para 32 Apex Court observed thus;
"This aspect of the matter had not been argued
before the Division Bench of the High Court. The
counsel appearing were remiss in bringing the same to the notice of the Court the binding precedents, as regards the jurisdictional aspect of the civil court in the light of Section 9 of the Code of Civil Procedure "::: Downloaded on - 09/06/2013 16:09:28 ::: 10
Therefore, it is fundamental presumption in statutory interpretation that ordinary Civil Courts have jurisdiction to decide all matters of a civil nature. As a corollary: (a) provisions excluding jurisdiction of civil court should receive strict construction (see: Bhagwat Singh vs. State of Rajasthan AIR 1964 SC 444; Raichand vs Union of India : AIR 1964 SC 1268 and;
(b) Provisions conferring jurisdiction on authorities and Tribunals other than Civil Courts ( see Kasturi and Sons vs Salivateswaran AIR 1958 SC 507; Upper Doab Sugar Mills vs. Shabdara (Delhi) Saharanpur Light Railway : AIR 1963 SC 217 have to be strictly construed. An objection as to jurisdiction of the Court to entertain and try the suit ought to be taken at preliminary stage of the suit at or before settlement of the issues. The defect as to non-
compliance of Sec. 164 of the Act is not such a defect which can absolutely take away inherent jurisdiction of the Court to decide plea of waiver raised by the plaintiff and if finding as to waiver is recorded in favour of the plaintiff the Civil Court may proceed to try the suit on merits and pass the decree. The mere absence of pre-suit statutory notice would not affect the fundamental jurisdiction of the civil court to decide the question of waiver and to proceed with the suit to ::: Downloaded on - 09/06/2013 16:09:28 ::: 11 pass the decree since it is a procedural defect. In a given case, if permitted by the Court the plaintiff may opt to withdraw from the suit and cure the defect by offering to issue a pre-suit statutory notice in writing in accordance with law and then to file a suit. Such permission if sought by the plaintiff may be considered by the Court when the objection is raised at preliminary stage of the suit. Section 9-A CPC as applicable in State of Maharashtra contemplate an objection at preliminary stage.
Section 9A CPC:
"Where at the hearing of application relating to interim relief in a suit, objection to jurisdiction is taken, such issue to be decided by the Court as a preliminary issue : (1) Notwithstanding anything contained in this Code or any other law for the time being in force, if, at the hearing of any application for granting or setting aside an order granting any interim relief, whether by way of stay, injunction, appointment of a receiver or otherwise,made in any suit, an objection to the jurisdiction of the Court to entertain such a suit is taken by any of the parties to the suit, the Court shall proceed to determine at the hearing of such application the issue as to the jurisdiction as a preliminary issue before granting or setting aside the order granting the interim relief. Any such application ::: Downloaded on - 09/06/2013 16:09:28 ::: 12 shall be heard and disposed of by the Court as expeditiously as possible and shall not in any case be adjourned to the hearing of the suit."
10. Any application under section 9A CPC is required to be heard and disposed of by the Court as expeditiously as possible and cannot be adjourned to the date of hearing of the suit. Preliminary issue as to jurisdiction of the court to entertain the suit for want of pre-suit statutory notice is required to be decided by the Civil Court after giving full opportunity to the parties to lead evidence because finding on the preliminary issue framed may dispose of the suit. If the suit is capable of being disposed of on the issue of jurisdiction it should be so disposed in an expeditious manner according to law instead of allowing it to remain in docket for years together added to arrears. When the language of the provision is clear and umabiguous, it is duty of the Court to faithfully implement the mandate of the legislature.
Considerations of hardship to the plaintiff are irrelevant in the absence of waiver of pre suit statutory notice; waiver may be express or implied. But mere delay in raising objection as to the jurisdiction of the Court would not justify an inference of waiver. It is necessarily a question of inference to be drawn by Court based on the established facts and circumstances as to conduct of the defendant before and after the institution of the suit. To illustrate: A Municipal Corporation entitled to a pre-suit statutory notice otherwise; threatens to immediately demolish a house or building ::: Downloaded on - 09/06/2013 16:09:28 ::: 13 constructed by the plaintiff, in such case of apprehended injury the plaintiff is not expected to wait until notice is issued and served as per statutory requirement as Municipal Corporation by its conduct is estopped from contending that pre-suit statutory notice was not given before the institution of the suit. The waiver of pre-suit statutory notice is implied in such case where plaintiff may be required to rush with a suit to the Court pleading extreme urgency to protect his house or building likely to be demolished.
11. In the present case, the suit was instituted on 28.2.1991. The written statement was filed on 23.8.1991.Issues were framed on 16.1.1993 and were subsequently re-casted by the trial Court after the defendant sought additional issues on 17.9.1993 and 2.2.1994 The suit was decided by trial Court on 14.2.1994 by dismissal thereof.
12. Looking into averments of the plaint in RCS No. 39/1991 it appears pleaded that the defendant Jijamata Sahakari Sakhar Karkhana is in the business of supplying sugarcane for the purpose of sowing ( bene) to the farmers and to accept sugarcane for the purposes of production of sugar and for that purpose they have to appoint some trucks for the transportation of sugarcane from the field of farmers to the factory ; or they have to appoint some trucks to supply sugarcane for the purpose of sowing from the factory to the concerned farmers. It is the case of the plaintiff that the defendant had appointed the plaintiff to supply sugarcane for the purpose of supplying bene of sugarcane sowing to farmers at Mera, Dhad, Utarapeth.
::: Downloaded on - 09/06/2013 16:09:28 ::: 14Thus contract is pleaded by the plaintiff for a consideration of Rs. 350 /- per day, payable by the defendant as the truck charge and that the defendant society will bear other charges like diesel, oil etc. Thus, the contract was for transportation of sugarcane for sowing by the truck to various farmers. The dispute was,thus, touching the business of society. Under these circumstances, it is contended that pre-suit statutory notice as required under section 164 of the said Act of 1960 was necessary. Reference is made to the ruling in Gurudev Developers vs. Kurla Konkan Niwas Co-op.
Housing Society reported in 2000(3) Mh.L.J. 13 in which it is held that suit against Cooperative Housing society was not maintainable without notice u/s 164 of the Act of 1960 in respect of an agreement entered into between the plaintiff and the defendant touching the business of the society. Reference is also made to ruling in Mohan Meakin Ltd.Bombay vs. The . Pravara SSK Limited reported in 1987 Mh.L.J. 503, wherein in Para No.18, the Division bench of this Court considered the provisions of Section 164 of the Act of 1960 and held the word "touching" is very wide but with certain limitations and would include any matter relates to concerns or affects the business of the society. The Court expressed its opinion that Section 164 of the Act , must apply to every suit in respect of any act touching the business of the society whether founded on contractual liability or in torts. An useful reference can also be made to the ruling in AIR 1984 SC 1043 in the case of Bihari Chowdhary and another vs. State of Bihar and others wherein it has ::: Downloaded on - 09/06/2013 16:09:28 ::: 15 been held that a suit against the Government or a public officer to which the requirement of a prior notice under sec. 80 CPC is attracted cannot be validly instituted until the expiration of the period of two months next after the notice in writing concerned in the manner prescribed for in the section and if filed before the expiry of the said period, the suit has to be dismissed as not maintainable. Under these circumstances, it appears that the specific contention was raised by the defendant in the written statement that the defendant society is constituted under the Act of 1960. It is a registered cooperative society and, therefore, it was essential for the plaintiff to give notice as required under the law. The issue was accordingly framed on 17.9.1993 as to whether the suit is bad for want of notice under the Maharashtra Cooperative Societies Act, 1960. The trial Court did consider the issue on the basis of evidence and recorded a finding that the plaintiff had not issued necessary notice u/s 164 of the said Act of 1960 and arrived at findings that the evidence on record as well as pleadings of the parties established that the defendant no1. Society was dealing in business of sugarcane for various purposes and the transaction was touching the business of society and, therefore, Section 164 of the Act was applicable. The lower Appellate Court also considered the submissions advanced in this regard based upon facts pleaded in the plaint and the defence on the ground of want of pre-suit statutory notice as required under section 164 of the Act of 1960. However, the lower Appellate Court appears to have misled itself ::: Downloaded on - 09/06/2013 16:09:28 ::: 16 that the act touching the business of society does not mean affairs of the society. The finding is quite contrary to the facts about business of the Society pleaded by the plaintiff and the objection raised by the defendant in the facts and circumstances of the present case; as also the rulings referred to above. The plaintiff had failed to establish the fact that pre-suit statutory notice in accordance with section 164 of the Act was issued to the defendant society and served upon the Registrar of the Cooperative society before the suit was filed. The finding of law and fact recorded by the trial Court, therefore, ought not have been disturbed by the lower Appellate Court.
There was no justification whatsoever for the lower Appellate Court to depart from the view of the trial Court which was based upon the pleading, evidence and relevant statutory provisions u/s 164 of the Act. The substantial question of law arising in this case must be therefore be answered to the effect that the Civil Court had no jurisdiction to entertain the suit in this case as it was instituted against the cooperative housing society without compliance of requirements contained in section 164 of the Act of 1960. The suit was instituted without pre-suit statutory notice and no waiver was established before the Civil Court; the suit therefore was correctly dismissed by the trial Court.
13. For the reasons stated herein-above, the impugned judgment and order is set aside and the judgment and decree dated 14.2.1994 passed by ::: Downloaded on - 09/06/2013 16:09:28 ::: 17 learned Joint Civil Judge (Jr.Dn) Chikhli in RCS No. 39/1991 is restored. The Appeal is allowed accordingly. No order as to costs.
JUDGE sahare ::: Downloaded on - 09/06/2013 16:09:28 :::