The interpretation of statutory provisions under the Maharashtra Co-operative Societies Act, particularly Section 91 and Section 45, was crucial in determining the jurisdiction of the Civil Court.

1. The preliminary issue with regard to the bar of the inherent jurisdiction of the Court under Section 91 of the Maharashtra Co-operative Societies Act, 1960 (MCS Act) is to be decided. The issue has been framed thus:

Whether this Court's jurisdiction is barred under Section 91 of the Maharashtra Co-operative Societies Act, 1960.

2. The suit is filed by a co-operative housing society against the two previous owners of the land owned by the society, part of which came to be leased to them under an unregistered agreement of lease. The suit is also filed against the Ex-Secretary of the society who is alleged to have executed a forged and fabricated document in favour of another third party. Defendant Nos.1 & 2 are the previous owners. Defendant No.3 is the previous Secretary. Defendant No.4 is the successor in interest of defendant Nos.1 & 2 under certain documents executed by and between defendant Nos.3 & 4.

3. The predecessors-in-title of defendant Nos.1 & 2 sought to develop their property for construction of the building of the plaintiff-society. Their land upon which was their dwelling house was agreed to be and came to leased to defendant Nos.1 & 2. The lease is unregistered. The main property of defendant Nos.1 & 2 came to be conveyed to the plaintiff-society.

4. It is alleged that defendant No.3 without authority of the plaintiff executed a Deed of Confirmation and registered the Indenture of Lease on behalf of the plaintiff without knowledge and consent of the plaintiff. Defendant No.3 is also alleged to have executed a Deed of Modification Agreement, Deed of Assignment and Conveyance in favour of defendant No.4 for and on behalf of plaintiff-society but without its knowledge and consent. Defendant No.3 is stated to have acted upon a resolution purportedly passed by the plaintiff-society but which is alleged to be forged.

5. The plaintiff-society has sought declaration and cancellation of the Deed of Modification, Deed of Confirmation Agreement and Deed of Assignment/Conveyance.

6. It has to be seen whether the dispute between the parties falls within Section 91 of the MCS Act, the relevant part of which runs thus:

91. Disputes.-

(1) Notwithstanding anything contained in any other law for the time being in force, any dispute touching the constitution, elections of the committee or its officers other than elections of committees of the specified societies including its officer, conduct of general meetings, management or business of a society shall be referred by any of the parties to the dispute, or by a federal society to which the society is affiliated or by a creditor of the society, to the Cooperative Court if both the parties thereto are one or the other of the following –

(a) ….........

(b) ….........

(c) a person other than a member of the society, with whom the society has any transactions in respect of which any restrictions or regulations have been imposed, made or prescribed under sections 43, 44 or 45, and any person claiming through such person;

(d) ….....

(e) …......

7. Under Section 91 to bar the Civil Court's jurisdiction, which is otherwise unlimited and is only subject to express and implied bar under a statute, it must be a dispute touching the management of the society and between the society, its members or the person other than the members of the society who has entered into any transaction in respect of which certain restrictions and regulations are prescribed inter alia under Section 45 of the MCS Act. Section 45 runs thus:

45. Restrictions on other transactions with non-members. – Save as is provided in this Act, the transactions of a society with persons other than members, shall be subject to such restrictions, if any, as may be prescribed.”

8. There are no regulations or restrictions prescribed with regard to defendant No.4 who is the person other than the plaintiff-society's member and who has entered into the aforesaid transactions with defendant No.3, the Ex-Secretary of the society.