TaxTMI 
TaxTMI 
1962 (3) TMI 99
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....utta. It carries on the business of manufacturing sugar in its factory at Sugauli in the district of Champaran, in Bihar. The first respondent is the Assistant Registrar, Co- operative Societies, Motihari Circle, Motihari, in the State of Bihar; the second respondent is the Union of Co-operative Societies, and is registered under the Bihar and Orissa Co- operative Societies Act (B. & O. Act VI of 1935) (to be referred to hereinafter as the Act); the third respondent is the State of Bihar. On August 14, 1961, respondent No. 2 made a reference under s.48 of the Act, against the appellant, claiming the sum of ₹ 1,20,809/- odd, as commission and interest for supply of sugarcane during the crushing season 1959-60. The said reference was registered by the first respondent as Award Case No. 101 of 1961, on August 17, 1961.. Notice of the said reference was issued to the appellant. On September 26, 1961, the appellant took a preliminary objection to the jurisdiction of the first respondent to entertain the reference and to adjudicate upon it, and prayed that the reference be rejected. The first respondent, following a decision of the Patna High Court, reported in Union of India v. R....
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....mon interests of its members in accordance with cooperative principles, or a ,society' established with the object of facilitating the operation of such a society, may be registered under the Act. On such registration, the Society becomes a body corporate with perpetual succession and' a common sea], and with power to acquire and hold property, to enter into contracts, to institute and defend suits, etc. Under s. 15, a registered society shall receive deposits and loans from members and non-members only to such extent and under such conditions as may be prescribed. Under a. 16, ordinarily a registered society shall not make a loan to any person other than a member, except with the, general or special sanction of the Registrar and subject to such restrictions as he may impose. Section 17 further provides for such prohibitions and restrictions, in respect of the transactions of registered society with persons other than members, as the Provincial Government may by rules prescribe. Section 48 makes it obligatory that any dispute touching the business. of' a registered society, among members, past members, persons claiming through members, past members or deceased members a....
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....rms and conditions as may be prescribed by the Registrar, act as agent for the financing bank and as such agent carry out, with or without any commission, all or any transactions connected with loans or advances made or to be made by the financing bank." A consequential change was made 'in s. 23 of the Act of 1935, by inserting a. 23-A, so as to make a debt or an outstanding demand to a registered society from a non-member a first charge on the property of the non-member. The most important amendment was made by a. 6, in s. 48 of the main Act as follows "6. In sub-section (1) of section 48 of the said Act-(&) after clause (d), the word "shall be inserted and thereafter the following clause shall be inserted, namely :- "(e) between a financing bank authorised under the provisions of sub-section (1) of section 16 and a person who is not a member of a registered society;" and (b) in Explanation (1), after the words "from a member," the word "non-member" shall be inserted. an(-] after the words "of a deceased member" the words "or nonmember" shall be inserted. It is not necessary to refer to the other conseque....
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....heir or legal representative of a deceased member or non-member or from sureties of members, past members or deceased members, whether such sureties are members or non- members, shall be a dispute touching the business of the society within the meaning of this subsection even in case such debt or demand s admitted and the only point at issue is the ability to pay the manner of enforcement of payment. (9) Save as expressly provided in this section, a decision of the Registrar under this section, and subject to tile orders of the Registrar on appeal of review, a decision given in a dispute transferred or referred under clause (b) or (c) of sub-section (2), shall be final." From the provisions of the Act, set out above, it is manifest that the act created a special tribunal, namely, the registrar of Co-operative Societies, to deal with certain disputes specified in s. 48(1)(a) to (e). This special tribunal was created with a view to shortening litigation and providing speedy relief to registered societies and their members in their disputes inter se in respect of the business of the society. Before the amendments introduced by the Act of 1948 the disputes which could be, ent....