The separate legal entity status of a Co-operative Society and the interpretation of legal provisions regarding the liability of individuals associated with Co-operative Societies under Section 409, Indian Penal Code.

M.R. Sharma, J. - Leave granted. Notice. Bailabe warrants.

2. One of the points which arise in this case is whether a Secretary or a person working on behalf of the Co-operative Society can be convicted under Section 409, Indian Penal Code or not. In this connection, the learned defence Counsel drew our attention to a Single Bench decision of this Court in Gurmit Singh and another v. The State of Punjab, 1977 Chandigarh Law Reporter (P&H) 53. Therein after referring to Section 21 of the Indian Penal Code, the learned Judge held that an employee of Co-operative Society was not the servant of a Corporation established under a State Act. With utmost respect to the learned Judge, we are unable to concerned with this view. Sir John Salmond in his famous back on Jurisprudence 12th Ed has held with the subject of "Corporation" as under :-

"Corporations are of two kinds distinguished in English law as corporations aggregate and corporations sole Persons, says Coke are of two sorts, persons natural created of God, .......and persons incorporate or politique created by the policy of man (and therefore they are called bodies politique); and those be of two sorts, viz., either sole, or aggregate of many. A Corporation aggregate is an incorporated group of co-existing persons and a Corporation sole is an incorporated series of successive persons. The former is that which has several members at a time, while the latter is that which has only one member at a time. Corporations aggregate are by far the more numerous and important. Examples are a registered company, consisting of all the shareholders, and a municipal corporation, consisting of the inhabitants of the borough."

It deserves particular mention that even a Company registered under the Companies Act was regarded as a Corporation. Under Section 7 of the Punjab Co-operative Societies Act, 1961, an application has to be made to the Registrar for the purpose of registration of a Co-operative Society. This application has to be decided by him within a period of two months. If the application is granted, the Registrar has to give a certificate of registration to the Co-operative Society. It is not disputed that after a Co-operative Society is registered, it becomes a separate entity and has the capacity to sue and be used. Section 409, Indian Penal Code lays down that a public servant or a person working as a merchant, factor, or a broker or agent in connection with any business can be sued liable under Section 409, Indian Penal Code. We are accordingly of the view that the case deserves to be decided by a larger Bench preferably a Full Bench.

3. Let the papers be placed before the Honble Chief Justice for obtaining appropriate orders.

Sd/- M.R. Sharma

Judge

Sd/- Surinder Singh,

Judge

September 16, 1983.