Judgement

SIKRI, J. (on behalf of himself and Hegde, J.): This appeal by certificate granted by the High Court of Judicature at Bombay is directed against its judgment allowing the writ petition filed by the firm M/s. Dalichand Jugraj Jain, first respondent before us - hereinafter referred to as the petitioners - under Article 226 of the Constitution, and setting aside the order of the Assistant Registrar (D), Co-operative Societies, Bombay, referring the dispute between the petitioners and the Deccan Merchants Co-operative Bank Ltd., appellants before us hereinafter referred to as the Bank.

2. We may mention that in the petition filed before the High Court by the Petitioners there were four respondents; the first respondent was the Assistant Registrar (D), Co-operative, Societies, Bombay, the second respondent was the Registrar s nominee; the third respondent was the Bank and the fourth respondent was Waman Wasudeo Wagh - hereinafter referred to as the original owner. Before us the Bank is the appellant, while the petitioners and the three other respondents before the High Court are the First, second, third and fourth respondents.

3. The main point that arises in this appeal is whether the dispute between the petitioners and the Bank can be referred by the Registrar for arbitration under sub-s. (1) of Section 91 of the Maharashtra Co-operative Societies Act, 1960 (Mah. Act XXXII of 1961) hereinafter referred to as the Act.

4. Before we set out the relevant provisions of the Act it is necessary to state the relevant facts out of which the dispute arose. The original owner on June 29, 1961, executed an agreement by which he leased the entire ground-floor of building No. 195-197 Shaikh Memon Street, Bombay, to the petitioners on a monthly rent of Rs. 250/-. Clause 6 of this agreement mentions that the property had been mortgaged to the Bank. The appellant was established as a Banking company in the year 1917 as a co-operative society under the Co-operative Societies Act, 1912 (Central Act) and they are deemed to be registered under the Act. The original owner was the Chairman of the Bank, and he had taken a loan from the Bank and as security for the due payment of the loan taken by him he had deposited the title deeds of the said property with the Bank, and thus mortgaged the building to the Bank.

5. It appears that certain arbitration proceedings between the Bank and the original owner took place before the Registrar s nominee, Bombay Greater and Bombay, and a consent award was given between the parties on October 26, 1961, under which the original owner was ordered to pay to the Bank a sum of Rs. 6.00,000/- by certain instalments as therein provided. Clause 5 of the said consent award mentioned that the said immovable property at 195-197 Shaikh Memon Street, would continue as security for the claims of the Bank till entire satisfaction. It further appears that the original owner committed default in making payment of the amount under the consent award and thereupon, in execution of the said award, an order was made on January 3, 1963, under Sec. 98 of the Act, for the sale of the said property. As the property could not be sold for want of buyers, the Collector of Bombay made an order and issued a certificate of transfer, dated May 13, 1963, under Section 100 of the Act, directing that the right, title and interest of the owner in the said property would be transferred to the Bank subject to the terms and conditions laid down in the schedule to the said certificate of transfer. In accordance with the directions given to the Revenue Inspector, the Revenue Inspector of the Collector of Bombay prepared a list of the tenants of the property on May 15, 1963, and furnished the same to the Bank. Physical possession of the property was also handed over to the Bank.

6. On June 5, 1963, the Bank addressed a letter to the petitioners stating that the Bank had come to know that they were occupying the entire ground floor of the building (situat