Mr. Justice D.R. Vithal Rao, President— This appeal, by the opposite party, is directed against the order dated 19-5-1993, passed by the District Fourm, U.K. District, Karwar, in Complaint No. 87/92, directing the opposite party-society to refund the balance amount after adjusting the loan amount with the amount due to the complainant towards fixed deposit.

The facts, briefly stated, are as follows:

1. The complainant made a complaint against the Kulve Grama Seva Sahakari Sangha, that is, Co-operative Society, alleging that he was the shareholder of the said Co-operative Society and as a share-holder had made a fixed deposit in a sum of Rs. 14,297/- with the society. The complainant had obtained loan from the opposite party-society and regarding which by 2-8-1991, he was due in a sum of Rs. 14,199/- to the society. The complainant issued notice to the society to adjust his fixed deposit amount towards the loan amount and as the society failed to do so, made a complaint seeking a direction to the society to refund the balance amount on adjusting loan amount with his fixed deposit amount in the society.

2. The opposite party filed its version and admitted the fact that the society had fixed deposit amount in a sum of Rs. 14,297/- and it also admitted that the complainant was due to it in a sum of Rs. 14,199/- towards the loan obtained by him from it. The opposite partysociety, further contended that the Forum had no jurisdiction as the dispute averred by the complainant comes under the provisions of Section 70 of the Co-op. Societies Act, 1959 and sought the complaint to be dismissed.

3. Having regard to the admitted facts of the case, the District Forum, heard the parties and granted the reliefs sought for by the compltt. directing the opposite party-society to refund the balance amount on adjusting the loan amount in the amount lying in fixed deposit with it.

4. We have called for the records and received. We have also heard the learned Counsel for the parties.

5. There is no dispute regarding the amount lying in deposit with the society. It is also not disputed that the complainant was due to the society in a sum of Rs. 14,199/- towards the loan amount. The provisions of Section 70(1) of the Karnataka Co-operative Societies Act, 1959, read as under:

“70. Disposal of disputes—(1) The Registrar may, on receipt of the reference of a dispute under Section 70,—

(a) decide the dispute himself, or

(b) transfer it for disposal to any person who has been invested by the State Government with powers in that behalf, or

(c) refer it for disposal to one Arbitrator appointed by the Registrar.”

6. The dispute between the parties is clearly is a dispute touching the business of the Co-op. Society arising between the Member and the Society. Having regard to this fact, this dispute has to be necessarily referred to and settled by the Registrar of Co-operative Societies, under the provisions of Section 70(1) of the Karnataka Co-operative Societies Act, 1959.

7. The District Forum, has at para 7 of its order, referred to this aspect of the matter, as under:

“7. So far regarding the jurisdiction is concerned, Section 70 of the Act prohibits the Courts to settle the dispute between a Member and Society, This Forum is not a Court and therefore Section 70 of the Act, is no bar to decide this case.”

8. The District Forum is clearly in error in reading the provisions of Section 70 of the Act. The provisions, as referred above, clearly prohibit the settlement of the dispute arising between the member and a society touching the business of the Society by any Forum other than the Registrar of Co-operative Societies.

9. Having regard to these facts, in our opinion, the District Forum has erred in granting the relief sought for by the complainant.

ORDER

In the result, therefore, this appeal is allowed and the order of the District Forum, U.K., Karwar, recorded on 19-5-1993 in Complaint No. 87/92, is set aside and the complaint is dismissed.

The parties are direct