BINDESHWARI PRASAD Vs. SHIVA SUTT SINGH

JUDGEMENT

(1.) These appeals arise out of a suit instituted by seven out of eight members of a Hindu joint family (the eighth member being defendant 2 in the suit) under the following circumstances.

(2.) In village Rajpur where the plaintiffs and defendant 2 reside there was a Co- operative Society established under the Co-operative Societies Act of 1912 which consisted of about 251 members including Lachhmi Narain Singh, defendant 2. Lachhmi Narain, to use the words of the Subordinate Judge who has tried the suit, occupied a unique position in this organization, because he was at once the Secretary of the Society and the Guarantee Union, a Director of the Central Co- operative Bank and a member of the managing committee of the Bank. He had thus no difficulty in securing large loans for his own family from the Society with the result that its course of time the Society became indebted to the Central Cooperative Bank to the extent of Rs. 34,922 and as it could not repay the debt, the Registrar had to cancel its registration in 1927 and place it in the hands of a liquidator. Defendant 1 who was appointed the liquidator of the Society then proceeded to determine the contribution to be made by the various members of the Society under Section 42, Co-operative Societies Act, and fixed the liability of Lachhmi Narain at Rs. 20,510-5-9. The order of the liquidator which is on the record shows that Lachhmi Narain owed to the Society Rs. 18,645-12.2 and to this was added a comparatively small sum of Rs. 1800 as the cost of liquidation. The liability of the other twenty-four members who had to contribute among themselves a little less than Rs. 16,000 was also fixed on the same principle. The figures quoted above are sufficient to indicate that the downfall of the Society was due largely to the continued borrowings of Lachhmi and a further example of his unscrupulous conduct is furnished by the fact that he subsequently made away with the papers of the Society and did not return them to the Liquidator until after a criminal prosecution had been started against him.

(3.) The Liquidator's contribution order being approved by the Registrar, the latter submitted a requisition to the Certificate Officer of Gaya for realising Rs. 20, 510 odd from Lachhmi Narain through certificate proceedings under the Public Demands Recovery Act. The certificate was duly issued but when the Certificate Officer proceeded to execute the certificate by the sale of certain properties belonging to Lachhmi Narain and other members of his family, defendants 2 and 3, two brothers of Lachhmi Narain, came forward and objected to the sale on the ground that the properties sought to be sold belonged to the entire joint family and could not be sold in execution of a certificate against Lachhmi Narain alone. This objection was upheld by the Certificate Officer and the Collector, but the Commissioner to whom the matter was taken in revision directed the Certificate Officer to enquire whether Lachhmi Narain was a member of the Rajpur Co- operative Society in his personal capacity or as karta or representative of the joint family composed of himself, his father, brothers and sons. The Certificate Officer after considering the evidence adduced before him, which included the evidence of plaintiff 1 father of Lachhmi Narain, found that Lachhmi Narain represented the family and had borrowed money in that capacity from the Society for family purposes. This finding was accepted by the Commissioner and he dismissed the objection of Lachhmi Narain's brothers on 18 February 1931. Sometime later a similar objection was preferred before the Certificate Officer by Shiva Dutt, father of Lachhmi Narain and the other plaintiffs namely two brothers and four sons of Lachhmi Narain but it was rejected by the Certificate Officer on 29 June 1931.