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1980 Supreme(AP) 328

Andhra Pradesh High Court
Judges : A.GANGADHARA RAO
Karimnagar Dist.Co-op.Central Bank Ltd. - Appellant
Versus
Mogili Bakka Veeraiah - Respondent
Decided On : 12-08-80

A suit against a Co-operative Society is not maintainable without giving notice under Section 126 of the Andhra Pradesh Co-operative Societies Act, 1964.

Headnote:

CO-OPERATIVE SOCIETIES - SUIT AGAINST SOCIETY - NOTICE UNDER SECTION 126 OF THE ANDHRA PRADESH CO-OPERATIVE SOCIETIES ACT, 1964 - NECESSITY - CLAIM PETITION UNDER RULE 52 OF THE ANDHRA PRADESH CO-OPERATIVE SOCIETIES RULES, 1964 - REJECTION - SUIT WITHIN SIX MONTHS - NOTICE UNDER SECTION 126 - NECESSITY.

Fact of the Case:

Plaintiffs filed a suit against the Co-operative Central Bank and a member of the Co-operative Society for recovery of their share of the produce from the lands attached by the Bank for arrears due to the Society. The Bank filed an Interlocutory Application stating that the suit was not maintainable since notice was not given to it under Section 126 of the Andhra Pradesh Co-operative Societies Act, 1964 before filing the suit.

Finding of the Court:

The court held that the suit was not properly instituted as the plaintiffs had not given the requisite notice under Section 126 of the Andhra Pradesh Co-operative Societies Act, 1964 before filing the suit.

Issues: Whether a suit against a Co-operative Society is maintainable without giving notice under Section 126 of the Andhra Pradesh Co-operative Societies Act, 1964.

Ratio Decidendi: The court held that Section 126 of the Andhra Pradesh Co-operative Societies Act, 1964 is mandatory and requires that a notice be given to the Registrar before filing a suit against a Co-operative Society. The court further held that a Claim Petition filed under Rule 52 of the Andhra Pradesh Co-operative Societies Rules, 1964 is similar to a suit under Order 21, Rules 58 and 63 of the Code of Civil Procedure and, therefore, a suit filed within six months from the date of rejection of the Claim Petition must also be preceded by a notice under Section 126 of the Act.

Final Decision: The court set aside the order of the lower court and allowed the revision petition filed by the Bank.

A. GANGADHARA RAO, J.

( 1 ) THE 1st defendant, Karimnagar District Co-operative Central Bank Limited, is the petitioner. The 2nd defendant Thota Veeraiah, is a member of the Co-operative Society, Ramadugu. He was in arrears of Rs. 810. 00 to that Society. The Sale Officer of the 1st defendants Bank attached the standing crops on his lands, for the arrears. It is the case of the plaintiffs that the 2nd defendant is only having 1/4th share in the lands. They filed a Claim Petition under Rule 52 of the A. P. Co-operative Societies Rules 1964, for release of the attached paddy before the Sale Officer. Later on they were informed on 7/10/1976 that the petition was dismissed on 9th Oct. , 1975. Subsequently, they filed a suit on or about 17/12/1976 in the Court of the District Munsif, Karimnagar against the Karimnagar District Co-operative Central Bank (1st defendant) and Thota Venkaiah (2nd defendant) to recover Rs. 350. 00 from the 1st defendant (Co-operative Central Bank, Karimnagar) and to pay Rs. 300. 00 to the 1st plaintiff and Rs. 50. 00 to the 2nd defendant towards their share of the produce from the lands.

( 2 ) AN Interlocutory Application was filed by the 1st defendant-Bank stating that the suit was not maintainable, since, notice was not given to it under Section 126 of the Andhra Pradesh Co-operative Societies Act, 1964 (hereinafter referred to as the Act) before filing the suit. The learned District Munsif dismissed that petition relying upon a Division Bench decision of this Court in Hussain Ali Mirza v. State of Andhra Pradesh, (AIR 1963 Andh Pra 164 ). Questioning that order the 1st defendant (Bank) has filed this revision.

( 3 ) IT is submitted by the learned counsel for the petitioner that Hussain Ali Mirza v. State of Andh. Pradesh (AIR 1963 Andh Pra 164) is no longer good law, in view of the decision of the Supreme Court in Sawai Singhai v. Union of India, (AIR 1966 SC 1068 ).

( 4 ) SECTION 126 of the Andhra Pradesh Cooperative Societies Act, 1964 reads as follows:--"no suit snail be instituted against a society or any of its officers in respect of any act touching the constitution, management or the business of the society until the expiration of sixty days 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 delivered or left. "this provision is similar to Section 80 of the Code of Civil Procedure. It is not disputed that giving a notice in terms of the Section before filing of the suit against the Society is mandatory. In view of the Full Bench decision of the Madras High Court in Madhava Rao v. Surya Rao, (AIR 1954 Mad 103) the words "touching the business of a society" in Section 126 must be given their full import bearing in mind the object of the legislation. The disputes are not to be restricted to matters arising from and out of the business of the society, but are also (sic) (to be) extended to matters which are in some way concerned or related to the business of the society. The word "business" is not used in a narrow sense. In order to determine the business of the society, one has to look into the provisions of the Act, the rules and the Bye-laws framed by the society. All matters comprised in them or incidental or are necessary for carrying out those matters must be deemed to be the business of the society.

( 5 ) IN view of this decision, it has to be held that the suit relates to the business of the society, for it was filed in effect to set aside the claim order, which was in its terms filed when the standing crops of the plaintiffs were attached for arrears due to the Cooperative Society.

( 6 ) IN Hussain Ali Mirza v. State of Andhra Pradesh, (AIR 1963 Andh Pra 164) (supra) the question for consideration was whether a suit under Section 6 of the Government Demands Act (No.








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