IMPORTANT POINTS
The final order passed by a court or an authority does not cease to have effect merely by the presentation or existence of an appeal or even stay of execution. Unless operation of that order is stayed, all legal rights and liabilities which naturally flow from that order will accrue or be incurred by the parties involved therein.

JUDGMENT :

Bechu Kurian Thomas, J.

Rejection of nomination of the appellant on the ground that he was a defaulter to the society and hence acquired disqualification under Rule 44(1)(c)(i) of the Kerala Cooperative Societies Rules, 1969 (the ‘Rules’ for brevity) was impugned in the writ petition. Challenge against the said rejection did not find favour with the learned Single judge and the writ petition was dismissed. Aggrieved, appellant seeks our intervention.

2. Sri. Arjun Raghavan and Sri. T.R. Harikumar, learned counsel for the appellant, contended that the appellant was only a surety in respect of 3 loans taken by his immediate family member on 17-10-2018, which were repayable only within 5 years. However, in order to disqualify the appellant, the administrative committee of the Society filed three arbitration cases in which awards were passed on 29-11-2019, copies of which were produced in the writ petition as Exts.P2, P3 and P4. Learned counsel also contended that immediately on obtaining copies of the awards, respective appeals were filed before the Kerala Co-operative Tribunal under Section 82 of the Kerala Cooperative Societies Act, 1969 (hereinafter referred to as the ‘Act’ for short). It was also pointed out that along with the appeals, stay petitions were preferred in which the Tribunal issued an order staying execution of the award, and hence the appellant cannot be regarded as a defaulter under Rule 2(e) of the Rules. Learned counsel tried their best to impress upon this Court that the finding of the learned Single Judge that the stay order does not take away the nature of default of the appellant is legally untenable as according to him stay of execution of the award stands on the same footing as that of a stay of the award itself. On the aforesaid submissions, learned counsel attempted to persuade us to interfere with the judgment of the learned Single Judge.

3. We also heard Smt. K.R. Deepa, learned Government Pleader, Sri. R. Lakshmi Narayan, learned Standing Counsel appearing for the 1st respondent, as well as Sri. M. Sasindran, learned counsel appearing for the 4th respondent Society.

4. All of them, in unison, pointed out that there is no merit in the contention advanced by the appellant since he is a defaulter to the Society and the said default is not removed on account of the interim order of the Co-operative Tribunal, as evidenced by Exts.P5, P6 and P7.

5. In order to appreciate the contentions of the learned counsel, it may be apposite to extract Rule 2(e) and Rule 44(1) (c)(i) of the Rules, which read as follows:

Rule 2(e). “Defaulter” means any Cooperative Society against which or any person against whom a decree has been obtained.

Rule 44.Disqualification of membership of committee--(1) No member of the society shall be eligible for being elected, or appointed as a member of the committee of the society under S.28 if he:-

(a)......................

(b)......................

(c)(i) is in default to the society or to anyother society in respect of any loan or loans taken by him or loan in which he had stood surety, for such period, as is prescribed in the bye-laws of the society concerned or in any case for a period exceeding three months or is a defaulter to the society or to any other society;

6. A reading of the aforesaid provisions would bring to light that Rule 44(1)(c)(i) has two parts: the first part deals with default, while the second part deals with a ‘defaulter’. The difference in the language of the two parts has significance, especially when the definitions in Rule 2 are taken into reckoning. The word default is defined in Rule 2(d) as a failure to repay, while, as extracted above, defaulter means a person against whom a decree has been obtained. This Court had in Rajagopalan v. Baby Alex (1994 (2) KLT 974) and in Surendran Nair v. State of Kerala (2004 (1) KLT 407) noted the distinction in the language used in the two parts of Rule 44(1)(c)(i).

7. In the instant case, we are concerned with the latte