TaxTMI 
TaxTMI 
TaxTMI 
2016 (9) TMI 1612
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....duled property admeasuring 8000 sq. mts. The principal borrower failed to repay the loan installments. That being so, recovery proceedings were initiated Under Sections 74 and 76 of the said Act by the Bank against Respondent No. 3 and two sureties of the said loan. The Assistant Registrar of Cooperative Societies, by an Award dated 5.10.2007, noticed that despite being duly served summons by Registered post A.D., all the three opponents remained absent. As a result, an ex-parte award was passed holding all the three opponents jointly and severally liable to pay the loan dues amounting to Rs. 55,04,583/-. It may be mentioned that interest was payable at 21% compounded under the said deed of mortgage dated 2.12.1997. 3. A demand notice dated 12.6.2001 was then issued by the Bank under Rule 22 of the Multi State Co-operative Society Rules, 1985 against all the three said persons for a principal amount of Rs. 60,59,646/- together with further interest at 19% per annum from 1.4.2001 till the date of payment. 4. In spite of receiving the said notice, the defaulters failed to pay any amount towards bank dues, and the bank then referred the said award for execution to the Sale and Recov....
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.... under the Arbitration and Conciliation Act, 1996 [hereinafter referred to as "the 1996 Act"], and this being the case, the auction proceedings were set aside by the High Court stating that the award dated 5.10.2000 would be liable to be executed only in the manner provided by the 1996 Act. It is the correctness of this judgment that has to be inquired into in the present appeal. 8. Learned Counsel for the Appellants has placed the relevant provisions of both the 1984 Act and 2002 Act, and has relied in particular on Section 126(6) of the 2002 Act to contend that all legal proceedings that had been initiated under the 1984 Act would continue under that Act. This being the case, it is clear that as execution proceedings were initiated prior to 19th August, 2002, which is the date of coming into force of the 2002 Act, the said proceedings would be saved despite repeal of the 1984 Act by the 2002 Act. 9. On the other hand, learned Counsel appearing on behalf of the Respondent, argued that, under the 2002 Act, the 1996 Act alone would get attracted, and that, therefore, the High Court judgment was correct. Learned Counsel further argued that even if the impugned judgment were to be s....
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....society for any debt or demand due to it from a member or the nominee, heirs or legal representatives of a deceased member, whether such debt or demand be admitted or not; (b) a claim by a surety against the principal debtor where the multi-State co-operative society has recovered from the surety any amount in respect of any debt or demand due to it from the principal debtor as a result of the default of the principal debtor, whether such debt or demand is admitted or not; (3) If any question arises whether a dispute referred to the Central Registrar is or is not a dispute touching the constitution, management or business of a multi-State co-operative society, the decision thereon of the Central Registrar shall be final and shall not be called in question in any court. 76. Settlement of disputes.-(1) The Central Registrar may, on receipt of the reference of dispute Under Section 74,- (a) elect to decide the dispute himself, or (b) transfer it for disposal to any other person who has been invested by the Central Government with powers in that behalf. (2) The Central Registrar may withdraw any reference transferred under Clause (b) of Sub-section (1) and decide it himself....
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....ociety, its board or any officer, agent or employee of the multi-State co-operative society or liquidator, past or present, or (c) between the multi-State co-operative society or its board and any past board, any officer, agent or employee, or any past officer, past agent or past employee, heirs or legal representatives of any deceased officer, deceased agent or deceased employee of the multi-State co-operative society, or (d) between the multi-State co-operative and any other multi-State co-operative society, between a multi-State co-operative society and liquidator of another multi-State co-operative society and the liquidator of another multi-State co-operative society. Such dispute shall be referred to arbitration. (2) For the purposes of Sub-section (1), the following shall be deemed to be disputes touching the constitution, management or business of a multi-State co-operative society, namely: (a) a claim by the multi-State co-operative society for any debt or demand due to it from a member or the nominee, heirs or legal representatives of a deceased member, whether such debt or demand be admitted or not; (b) a claim by a surety against the principal debtor where t....
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....sion or order, as the case may be; or (c) be executed by the Central Registrar or any person authorized by him in writing in this behalf, by attachment and sale or sale without attachment of any property of the person or a multi-State co-operative society against whom the decision or order has been made. 126. Repeal and saving. (1) The Multi-State Co-operative Societies Act, 1984 (51 of 1984) is hereby repealed. (2) Without prejudice to the provisions contained in the General Clauses Act, 1897 (10 of 1897) with respect to repeals, any notification, rule, order, requirement, registration, certificate, notice, decision, direction, approval, authorisation, consent, application, request or thing made, issued, given or done under the Multi-State Co-operative Societies Act, 1984 (51 of 1984) shall, if in force at the commencement of this Act, continue to be in force and have effect as if made, issued, given or done under the corresponding provisions of this Act. (3) Every multi-State co-operative society, existing immediately before the commencement of this Act which has been registered under the Co-operative Societies Act, 1912 (2 of 1912) or under any other Act relating to co-o....
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....itration are now to be settled or decided by the Arbitrator to be appointed by the Central Registrar, and the provisions, therefore, of the 1996 Arbitration and Conciliation Act shall apply to such arbitration as if the proceedings for arbitration were referred for settlement or decision under the provisions of the said Act. 13. Thus it can be seen that Section 84(4) and (5) of the new Act provide for a different scheme. Equally, Section 94 which provides for execution of certain decisions and orders made under the 2002 Act, mentions various Sections, but Section 84 is conspicuous by its absence. This is obviously for the reason that the entire proceedings have now to be conducted under the 1996 Act, including execution of the arbitration Award made under the said Act. The question before the High Court was whether proceedings initiated under the old Act could continue under the said Act. 14. For this, it is important to advert to Section 126(6), which has been completely missed by the High Court. By this Section, any legal proceeding pending before any authority at the commencement of the 2002 Act shall be continued to be before that authority as if the 2002 Act had not been pas....
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....he judgment under appeal is incorrect, and would have to be set aside. 20. In the affidavit in reply filed by the bank to the Writ Petition, the bank states that it has recovered the entire loan due together with interest amounting to Rs. 85,15,311.75 as against Rs. 86 lakhs received in the auction proceedings, and admits that the balance amount of Rs. 74,688.25 over and above the loan dues are payable to the borrower. This being the case, and in order to do complete justice between the parties, it is ordered that the amount of Rs. 74,688.25, together with interest at the rate of 19 per cent compounded per annum with effect from 1st April, 2007, be paid by the bank to the borrower within a period of four weeks from the date of pronouncement of this judgment. 21. Learned Counsel for the Respondent exhorted us to send the matter back for a decision on grounds (V) and (VI) of the Writ Petition which read as follows: (V) The Petitioner further submits that the said Sale Certificate issued by Respondent No. 2 pursuant to the notice dated 17.3.2007 is also void being passed under the colour of powers, in as much as the Respondent No. 2 could not give a go-bye to the mandate of Rule 3....
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....eat clarity and particularity. Also, the Appellant cannot claim to be in the dark as every auction sale was publicly advertised in newspapers. We, therefore, do not accede to counsel's fervent plea to remit the rest of the Writ Petition to the High Court for hearing. 23. We therefore set aside the judgment under appeal as a whole. There will not be any order as to costs. 1(13) (a) Where immovable property has been sold by the Sale Officer, any person either owning such property or holding an interest therein by virtue of a title acquired before such sale may apply to have the sale set aside on his depositing with the recovery officer- (i) for payment to the purchaser a sum equal to five per cent of the purchase money, and (ii) for payment to the decree-holder, the amount of arrears specified in the proclamation of sale as that for the recovery of which the sale was ordered together with interest thereon and the expenses of attachment, if any, and sale and other costs due in respect of such amount, less amount which may since the date of such proclamation have been received by the decree-holder. (b) If such deposit and application are made within thirty days from the da....