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CALCUTTA HIGH COURT
Monoranjan Mallick & Manabendra Nath Roy, JJ
In re : Bankura Wholesale Consumers Co-operative Society Ltd.
Vs.
West Bengal Essential Commodities Supply Corporation Ltd. & Anr.
Decided On : March 20, 1991
CO-OPERATIVE SOCIETIES - DISPUTE SETTLEMENT - STATUTORY ARBITRATION - WEST BENGAL CO-OPERATIVE SOCIETIES ACT, 1983 - SECTIONS 95, 134 - ARBITRATION ACT, 1940 - SECTIONS 46, 6(1), 7, 12, 26, 37 - CO-OPERATIVE SOCIETY - DISPUTE WITH CORPORATION - HANDLING AGENT AGREEMENT - ARBITRATION CLAUSE - VALIDITY - JURISDICTION OF CIVIL COURT - REJECTION OF PLAINT - LEGALITY.
Fact of the Case:
A dispute arose between a Co-operative Society (petitioner) and a Corporation (opposite party) over a handling agent agreement. The petitioner filed a plaint before the Assistant Registrar of Co-operative Societies seeking an award for the realization of a monetary claim. The Assistant Registrar rejected the plaint on the grounds that there was an arbitration agreement between the parties and that the petitioner had not sought a declaration of the agreement being void. The petitioner appealed to the Member, West Bengal Co-operative Tribunal, who affirmed the order of the Assistant Registrar.
Finding of the Court:
The court held that the dispute between the petitioner and the Corporation was a dispute concerning the business of the Co-operative Society and relating to its affairs. Therefore, it was subject to the statutory arbitration provisions of Section 95 of the West Bengal Co-operative Societies Act, 1983. The court further held that the arbitration clause in the agreement between the parties was rendered inoperative by the statutory arbitration provisions of the Act. The court also held that the Assistant Registrar erred in rejecting the plaint on the ground that the petitioner had not sought a declaration of the agreement being void.
Issues: 1. Whether the dispute between the petitioner and the Corporation was subject to the statutory arbitration provisions of Section 95 of the West Bengal Co-operative Societies Act, 1983? 2. Whether the arbitration clause in the agreement between the parties was valid and enforceable? 3. Whether the Assistant Registrar erred in rejecting the plaint on the ground that the petitioner had not sought a declaration of the agreement being void?
Ratio Decidendi: 1. The court held that the dispute between the petitioner and the Corporation was subject to the statutory arbitration provisions of Section 95 of the West Bengal Co-operative Societies Act, 1983, because it was a dispute concerning the business of the Co-operative Society and relating to its affairs. 2. The court held that the arbitration clause in the agreement between the parties was rendered inoperative by the statutory arbitration provisions of the Act. The court relied on Section 46 of the Arbitration Act, 1940, which provides that the provisions of the Act, except for certain sections, shall apply to every arbitration under any other enactment for the time being in force as if the arbitration were pursuant to an arbitration agreement. 3. The court held that the Assistant Registrar erred in rejecting the plaint on the ground that the petitioner had not sought a declaration of the agreement being void. The court held that the Assistant Registrar should have given the petitioner an opportunity to amend the plaint to seek the necessary declaration.
Final Decision: The court quashed the orders of the Assistant Registrar and the Member, West Bengal Co-operative Tribunal, and directed the Assistant Registrar to proceed with the plaint filed by the petitioner in accordance with law.
M.R. Mallick, J.: In this application under Article 227 of the Constitution the judgment and order dated 30th November, 1990 passed by the Member. West Bengal Co-operative Tribunal in Appeal No 43/88 affirming that the judgment and order dated. 30th September, 1988 passed by the Assistant Registrar of Co-operative Society, Bankura and the Arbitrator in the Dispute Case no. 1988-89 filed by the present petitioner before him under the provision of s. 95 of the West Bengal Co-operative Societies Act of 1983 have been challenged. The facts may be briefly stated as follows :-
2. The Chief Executive Officer, Bankura a Wholesale Consumers Co-operative Society Limited, Post & District Bankura bas filed a dispute case on 27.8.88 against the opposite party for an Award for realisation of the claim amounting to Rs. 22,87,332.72 The Assistant Registrar of Co-operative Society Bankura refused to entertain the said dispute-firstly on the ground that in view of the specific agreement executed by the plaintiff Society from time to time with the West Bengal Essential Commodities Supply Corpn. Ltd. (hereinafter referred to as The Corporation) there is no scope to entertain the plaints of the dispute for Arbitration and secondly, on the ground that the plaintiff has straight-way prayed for an Award of Rs. 22,87.332 72 against the Corporation without any reference and prayer thereof in the plaint for declaring the agreement null and void. The Assistant Registrar of the Co-operative Society, Bankura in the circumstances, has rejected the plaint under rule 171 (2) of the West Bengal Co-operative Societies Rules 1987 (hereinafter referred to as the said Rules).
3. Being aggrieved the present petitioner preferred appeal before the Member, West Bengal Co-operative Tribunal belong Appeal No. 43/88. The learned Tribunal has also dismissed the appeal and affirmed the order passed by the Assistant Registrar of Co-operative Societies Bankura. Being aggrieved the present petition under Article 227 of the Constitution has been filed.
4. It is submitted that the dispute raised by the petitioner by filing a plaint before the Assistant Registrar, Co-operative Societies Bankura is a dispute which is entertain able by him under the provision of s. 95 of the West Bengal Co-operative Societies Act, 1983, that the jurisdiction of the Civil Court has been expressly barred and such dispute which squarely comes within the purview of s. 95 of the West Bengal Co-operative Societies Act. 1983 Cannot be rejected by the Assistant Registrar of the Co-operative Society in limine. It is also submitted that even though the agreement entered into between the petitioner and the opposite party-Corporation contains an Arbitration Clause but that Arbitration Clause cannot be given effect to in view of the specific bar contained in the West Bengal Co-operative Societies Act, 1983 and the learned Appellate Tribunal has also committed an error of jurisdiction by affirming the order passed by the Assistant Registrar of Co-operative Societies. The opposite party-Corporation has contested the Revision Petition even though no affidavit-in-opposition has been filed. It is submitted that the agreement entered into between the petitioner and the Corporation, which has been renewed from time to time has been acted upon and cannot now be declared as void and consequently the learned Assistant Registrar rightly rejected the plaint and the learned Appellate Tribunal did not commit any illegality in confirming the order of the Assistant Registrar of Co-operative Society, Bankura.
5. We find that a dispute praying for an Award of money claim has been preferred by way of a plaint by the present petitioner before the Assistant Registrar of Co-operative Societies Bankura
6. It is urged on behalf of the petitioner that the petitioner-Society is a Consumers' Co-operative Society and deals with all kinds of consumer goods, that the Corporation entered into an agreement in question which has been
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