1984 Supreme(P&H) 315
PUNJAB & HARYANA HIGH COURT
J.V.Gupta, J.
Phool Singh
Versus
Ladwa Co-operative Marketing-cum-processing Society Ltd., Ladwa
Civil Revision No. 2719 of 1983,
Decided On : MAY 1, 1984
An award given under section 55 of the Punjab Co-operative Societies Act against a non-member of the society is illegal and a nullity, and the surety cannot be held liable for an amount greater than what he had agreed to.
Headnote:
EXECUTION OF AWARD - PUNJAB CO-OPERATIVE SOCIETIES ACT, 1961 - SECTIONS 55, 63 - AWARD GIVEN UNDER SECTION 55 - EXECUTION AGAINST SURETY - SURETY NOT A MEMBER OF THE SOCIETY - AWARD HELD TO BE ILLEGAL AND A NULLITY - EXECUTION PETITION DISMISSED.
Fact of the Case:
The decree-holder, a cooperative society, filed an execution petition to recover a sum of money based on an award given by an arbitrator. The judgment-debtor, who was proceeded ex parte, and his father, who was alleged to be the surety for the amount decreed, filed an objection petition challenging the legality of the award and the execution proceedings. The executing court dismissed the objection petition, relying on a previous judgment of the court.
Finding of the Court:
The court found that the executing court did not consider the objections raised by the judgment-debtor in light of a subsequent Full Bench decision that overruled the previous judgment relied upon by the executing court. The court also noted that the judgment-debtor did not lead any evidence despite being given multiple opportunities.
Issues: 1. Whether the award given under section 55 of the Punjab Co-operative Societies Act was legal and valid. 2. Whether the surety, who was not a member of the society, could be held liable for the amount decreed. 3. Whether the executing court erred in dismissing the objection petition without considering the objections raised by the judgment-debtor.
Ratio Decidendi: The court held that the award was illegal and a nullity since the judgment-debtor was not a member of the society and the surety could not be held liable for an amount greater than what he had agreed to. The court also held that the executing court erred in dismissing the objection petition without considering the objections raised by the judgment-debtor in light of the subsequent Full Bench decision.
Final Decision: The court set aside the order of the executing court and remanded the matter back for a fresh decision on the extent of the liability of the surety, Phool Singh, over and above Rs. 10,000/-.
J.V.Gupta, J.
1. This petition is directed against the order of the executing Court whereby the objection petition filed on behalf of the petitioner under section 47 read with section 151 of the Code of Civil Procedure and section 63(a) of the Punjab Co-operative Societies Act was dismissed.
2. The decree-holder, i.e. the Ladwa Co-operative Marketing-cum-Processing Society Ltd., Ladwa, District Kurukshetra filed execution petition for the recovery of Rs. 56,884/84 paise, on the basis of the award dated 15.2.74 given by the Arbitrator and on the basis of which the necessary certificate dated 3.6.1975 under section 63 of the Punjab Co-operative Societies Act Ex. AW.1/1 was issued by the Assistant Registrar. The execution application was filed against judgment-debtor No. 1 Gian Singh who was proceeded ex-parte and against his father Phool Singh who was alleged to be the surety for the amount decreed. Judgment-debtor Phool Singh filed objection petition dated 11.11.1974 inter alia on the ground that he had stood surety for the judgment-debtor, his son, only to the extent of Rs. 10,000/- and that he was not afforded any opportunity of being heard and thus, the award was illegal and a nullity and could not be executed as such. This objection-petition was contested on behalf of the decree-holder. Ultimately, the executing Court framed as many as 5 issues. The objector was given many opportunities to lead evidence, but in spite of that, no evidence was led on his behalf, inasmuch as he himself also did not enter in the witness box. On the other hand, the decree-holder examined AW.10 Brij Bhushan and produced 2 documents, namely Ex. AW.1/1 certificate and Ex. A1 copy of the award. In the absence of any evidence led by the judgment-debtor, the executing Court decided all the issues against the objector and thus, dismissed the objection petition. One of the objections was that since the objector was not a party to the arbitration proceedings, no execution could be taken against him, but the same was negatived by the executing Court, relying upon a judgments of this Court in Sunder Singh and another v. Central Co-operative Bank Ltd., Karnal, 1973 PLJ 433.
3. Dissatisfied with the same, the objector filed an appeal in the Court of the District Judge, Kurukshetra which was ultimately found to be not competent and as such, was dismissed, being not maintainable, vide order dated 5.9.1983. Consequently the revision petition against the order of the executing Court dated 8.4.1983, was filed in this Court on 27.10.1983. Along with the petition, an application under section 5 of the Limitation Act for condonation of delay was also filed. The petitioner also filed an affidavit of Shri Sat Pal Singh, Advocate, Kurukshetra, on whose advice, the appeal was filed in the Court of the District Judge. He has stated therein that it was he who had advised Phool Singh to file the appeal in the Court of the District Judge, Kurukshetra which was duly admitted to a hearing by the office without any objection having been raised.
4. At the time of motion hearing, the petitioner objector was directed to deposit a sum of Rs. 10,000/-, because he admitted his liability to that extent. Consequently, the said amount was deposited by him on 29.11.83 in the executing Court. After the deposit of the said amount, the petition was admitted to a hearing after notice of motion.
5. The learned counsel for the respondent-society raised a preliminary objection that the revision petition was barred by time and no ground for condonation of delay has been made out. According to the learned counsel, the mere fact that the appeal was filed on the wrong advice of the learned counsel, Shri Sat Pal Singh, was itself no ground for condonation of delay.
6. After hearing the learned counsel for the parties on the preliminary objection, I find that from the affidavit filed by Shri Sat Pal Singh, Advocate, Kurukshetra and the fact that the office of the District Judge, Kurukshetra