SAVCAR U VAIKUNTA BHAT Vs. KSARVOTHAMA RAO, OFFICIAL LIQUIDATOR OF UPPINANGADY CO-OPERATIVE SOCIETY NO1198, SUB-DEPUTY REGISTRAR OF THE MANGALORE SECTION

JUDGEMENT

(1.) The main question argued in this appeal is whether the suit is barred by Section 42(6) of the Co-operative Societies Act. The facts necessary for the disposal of this question may be briefly stated. The plaintiff became a member of the Rural Credit Society, Uppinangady, in 1914. His case ? is that he resigned his membership and withdrew his share capital in 1918; The society went into liquidation in 1923, and one Giriappa became the liquidator and he passed an order on 9 July 1925, that the plaintiff was not liable; subsequently the present liquidator Mr. Kannan Nair succeeded him and he passed an order Ex. II. on 6 December 1927 directing the plaintiff to contribute a sum of Rs. 500. To avoid coercive process, the plaintiff paid the amount and seeks a refund of the same. The plaintiff's contention is that under Section 23 of the Co-operative Societies Act, 1912, which governs the case his liability continued only for two years from the date of his ceasing to be a member and this liability ceased in 1920 and the liquidator has no jurisdiction under Section 42(2)(b) of the Act to levy any contribution from him. The answer of the liquidator is that the order made by him being a matter connected with the dissolution of the society, no suit will lie to contest the same by reason of Section 42(6) of the Act which runs as follows: Save in so far as hereinbefore expressly provided, no Civil Court shall have any jurisdiction in respect of any matter connected with the dissolution of a registered society under this Act.

(2.) It is a cardinal principle of the construction of Statutes that an enactment which seeks to oust the jurisdiction of Civil Courts should be construed strictly. The construction of the said clause in accordance with this principle is that before the jurisdiction of the Civil Court is ousted it must be a matter within the jurisdiction of the liquidator, though it may be a matter connected with the dissolution of the society. Therefore the question is, has the liquidator jurisdiction to pass the order in question under Section 42(2)(b) which is in these terms: A liquidator appointed under Sub-section 1 shall have power to determine the contribution to be made by the members and past members of the society respectively to the assets of the society.

(3.) Thus the condition precedent to the exercise of jurisdiction by the liquidator is that the person who is directed to contribute should be a member or a past member. If it is disputed, the liquidator would have no jurisdiction to determine the liability, but if there is no question that a person is a member or a past member the liquidator will have jurisdiction to assess the contribution according to the provisions of the Act. In this case the plainti ft is admittedly a past member, i.e., once a member but has now ceased to be. The liability of such a past member is determined by Section 23 which provides thus: The liability of a past member for the debts of a registered society as they existed at the time when he ceased to be a member shall continue for a period of two years from the date of his ceasing to be a member.