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Issues: (i) Whether a dispute falling within the scope of section 40 of the Bihar and Orissa Co-operative Societies Act, 1935 was excluded from the purview of section 48 of that Act. (ii) Whether the six-year limitation contained in section 40 governed a reference under section 48.
Issue (i): Whether a dispute falling within the scope of section 40 of the Bihar and Orissa Co-operative Societies Act, 1935 was excluded from the purview of section 48 of that Act.
Analysis: Section 40 provided a surcharge remedy for specified acts of misappropriation or wrongful payment, while section 48 created a wider machinery for disputes touching the business of a registered society, including disputes between the society and its past or present officer, agent or servant. The availability of a specific surcharge remedy did not, by itself, exclude the dispute reference mechanism. Where both remedies were available, the principle of election applied, and section 48 continued to be available unless the statutory conditions for its invocation were absent. The claim against the respondent, being one by the society against a past officer, was within clause (c) of section 48(1).
Conclusion: The dispute was not excluded from section 48 merely because section 40 was also attracted.
Issue (ii): Whether the six-year limitation contained in section 40 governed a reference under section 48.
Analysis: The six-year bar in the second proviso to section 40 was confined to proceedings under section 40 and could not be transplanted into section 48. The limitation relevant to section 48 had to be found within section 48 itself, including its proviso, and the facts did not bring the respondent within any bar under section 32 or section 63. The earlier decision relied on by the High Court was distinguishable on its facts and did not control the present case.
Conclusion: The limitation in section 40 did not apply to the section 48 reference.
Final Conclusion: The High Court's view that section 48 was unavailable was set aside, and the writ petition was sent back for reconsideration on the remaining unresolved questions.
Ratio Decidendi: The existence of a special surcharge remedy under section 40 does not exclude the wider dispute jurisdiction under section 48, and the limitation attached to section 40 cannot govern proceedings under section 48 unless the statute expressly so provides.
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