1 BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 11 .11.2011 CORAM: THE HONOURABLE MRS.JUSTICE ARUNA JAGADEESAN SA(MD)No.158 of 2008 1.The Secretary, TNSPL 171 Alagappapuram Primary Agricultural Cooperative Bank Kattarankulam Village, Kovilpatti Taluk Tuticorin 2.The Special Officer, TNSPL 171 Alagappapuram Primary Agricultural Cooperative Bank Kattarankulam Village, Kovilpatti Taluk Tuticorin Appellants Vs N.Kendiarsamy Respondent Prayer:- This Second Appeal is filed against the Judgement and Decree dated 23.11.2005 passed in AS.No.45/2005 by the learned Subordinate Judge, Kovilpatti, confirming the Judgement and Decree dated 06.04.2004 passed in OS.No.177/2003 by the learned District Munsif, Kovilpatti. For Appellants : Mr.S.Pon Senthil Kumaran For Respondents : Mr.R.Devaraj JUDGEMENT This Second Appeal is filed against the Judgement and Decree dated 23.11.2005 passed in AS.No.45/2005 by the learned Subordinate Judge, Kovilpatti, confirming the Judgement and Decree dated 06.04.2004 passed in OS.No.177/2003 by the learned District Munsif, Kovilpatti. 2. The case of the Plaintiff, who is the Respondent herein, as set out in the plaint in is as follows:- a. Originally the suit property belonged to one M.Sudalaimuthu, who was working as the Secretary in the 1st Defendant Bank. On 16.4.2003, M.Sudalaimuthu executed a registered General Power of Attorney in favour of one G.Sudalaimuthu in respect of the suit property. On the basis of the said Power of Attorney, the said Power Agent entered into a registered sale agreement with the Plaintiff agreeing to sell the suit property for a valid consideration and received an advance of Rs.20,000/- and on the basis of the sale agreement, the Plaintiff purchased the suit property under the sale deed dated 21.7.2003. Thus, the Plaintiff became the owner of the suit property and has been in possession and enjoyment of the same. On coming to know that the Defendants Bank was initiating disciplinary proceedings against the above said M.Sudalaimuthu for his alleged misappropriation of funds, the Plaintiff sent a notice to the 2nd Defendant, which was refused to be received by the Defendants. Again on coming to know that the Defendants' Bank was attempting to attach the suit property for the alleged dues from the above said M.Sudalaimuthu, the Plaintiff issued another notice to the 2nd Defendant and the Deputy Registrar of Cooperative Societies on 16.08.2003 informing them of the https://hcservices.ecourts.gov.in/hcservices/ 2 above facts and calling upon them not to proceed against the suit property, as the suit property belonged to the Plaintiff. b. The reply sent by the 2nd Defendant contained false allegations. On 22.8.2003, the Defendants Bank affixed a notice on the suit property, in spite of the protest by the Plaintiff. The Plaintiff purchased the suit property for a valid consideration. The Defendants' Bank have no right either to attach or to proceed against the property of the Plaintiff for the alleged dues of the above said M.Sudalaimuthu. In spite of the repeated requests, the Defendants' Bank is trying to attach the suit property. Hence, the suit has been filed for permanent injunction restraining the Defendants from interfering with the peaceful possession and enjoyment of the suit property by the Plaintiff either by getting it attached or by proceedings against it for the alleged dues of the above said M.Sudalaimuthu. 3. In the Written Statement filed by the Defendants, it is averred as follows:- a. The averments relating to Power of Attorney dated 16.4.2003 and possession of the suit property by the Plaintiff are false. While M.Sudalaimuthu was working as the Secretary of the Appellants' Bank for the past 20 years, he misappropriated the funds of the Bank to the tune of Rs.10,56,037/- and from 5.7.2003, he was not coming for duty and absconding. Hence, departmental proceedings were initiated and he was suspended. In order to cheat the Defendants' Bank, M.Sudalaimuthu and G.Sudalaimuthu colluded together and created concocted documents. In the departmental proceedings, the suit property was attached and since the attachment was completed, as against the same, the Plaintiff has to file an appeal, but whereas, he has filed this suit without impleading M.Sudalaimuthu and hence, the suit is not maintainable in law and the suit is liable to be dismissed. 4. Before the Trial Court, on the side of the Plaintiff, Exs.A1 to A10 were marked and PW.1 was examined. On behalf of the Defendants, Ex.B1 to B3 were marked and DW.1 was examined. 5. On consideration of the oral as well as the documentary evidence, the Trial Court decreed the suit and the appeal filed as against the same filed by the Defendants was dismissed, confirming the Judgement and Decree of the Trial Court. As against the same, this Second Appeal has been filed by the Defendants. 6. This Second Appeal has been entertained on the following substantial question of law:- "Whether the suit as framed is maintainable, in view of the provisions of the Tamil Nadu Cooperative Societies Act and more particularly under Sections 90 and 156 of the said Act?" . 7. I have heard the submissions made by the learned counsel on either side and also pursed the materials on record and the impugned judgements of the courts below. 8. The suit property originally belonged to one M.Sudalaimuthu, who was working as the Secretary in the Defendants' Bank. On 16.4.2003, M.Sudalaimuthu executed a registered General Power of Attorney under https://hcservices.ecourts.gov.in/hcservices/ 3 Ex.A2 in favour of one G.Sudalaimuthu in respect of the suit property. On the basis of Ex.A2, the G.Sudalaimuthu entered into a registered sale agreement with the Plaintiff agreeing to sell the suit property and received an advance of Rs.20,000/-. On the basis of the said sale agreement, the Plaintiff purchased the suit property under the sale deed Ex.A1 dated 21.7.2003. According to the Appellants' Bank, the said M.Sudalaimuthu has committed misappropriation of funds to the tune of Rs.10,56,037/-, for which disciplinary proceedings were taken against him and he was suspended. It is also said that the Appellants gave a public notice on 18.07.2003 not to deal with the suit property in any manner. The Appellants have also approached the Registrar and an order of attachment has been passed in respect of the suit property. 9. It is contended by the Appellants' Bank that the Respondent/plaintiff himself has stated in paragraph 4 of the plaint about the attachment proceedings taken by the Appellants against the suit property and Exs.A1, A6, A8 and A9 also indicated the same. Therefore, it is submitted that the Plaintiff was very much aware of the action taken by the Appellants against the suit property and if he had any objection or claim regarding the property, then he ought to have availed the remedy under Rule 135(1) of the Tamil Nadu Cooperative Societies Act. 10. Mr.Pon Senthil Kumaran, the learned counsel for the Appellants would contend that the suit filed by the Respondent/Plaintiff is not maintainable, when the jurisdiction of the civil court is specifically excluded under Section 156 of the Tamil Nadu Cooperative Societies Act. The learned counsel for the Appellants relying on the various provisions of the said Act and the Rules, particularly, Section 90, Section 167, Section 152 and Section 156 and Rule 135, which provide to the aggrieved party an adequate remedy to pursue his objection as regards the question as to whether the property belonging to the Plaintiff could be attached or not, submitted that the Plaintiff's recourse to the civil court was statutorily barred. 11. On the other hand, Mr.R.Devaraj, the learned counsel for the Respondent/Plaintiff contends that the property exclusively belonged to the Plaintiff and did not belong to the debtor and even before attachment of the property, the property had been purchased by him. Therefore, he would submit that the property could not be attached and that the bar of the civil court's jurisdiction under Section 156 will not be applicable to the facts of this case and relied on the decision of this court reported in 1997-1-CTC-378 (Mattadhari Primary Agricultural Coop. Bank Vs. Saroja Ammal and another). 12. At this juncture, it is relevant to refer to Section 156 of the Act, which reads as follows:- "156. Bar of jurisdiction of civil courts:- Notwithstanding anything contained in any other law for the time being in force, no order or award passed, decision or action taken or direction issued under this Act by an Arbitrator, a Liquidator, the Registrar or an officer authorised or empowered by him, the Tribunal or the Government or any officer subordinate to them, shall be liable to be called in question in any Court and no injunction shall be granted by any court in respect of anything which is done or intended to https://hcservices.ecourts.gov.in/hcservices/ 4 be done by or under this Act." 13. Section 156 deals with the bar of jurisdiction of civil courts in respect of orders passed by the statutory authorities under the Act. There is also bar against grant of injunction by any court. It is clear from a reading of Section 156 that to get protection under the Act, the authority under the Act must pass orders or awards or take action or issue direction, for which they are empowered under the Act. 14. Section 167 of the Act deals with furnishing of security and attachment of property. According to this Section, when the Registrar is satisfied on the application of a registered Society in respect of proceedings detailed therein that any party or person is about to dispose of the property with intent to defeat or delay the execution of any order that may be passed against him, the Registrar may, apart from directing the party to furnish security, separately order conditional attachment of the said property. The mode of attachment is specified in Rule 140. 15. Rule 135 relates to investigation of claims and objections to attachment of property. Rule 135(1) reads as follows:- "Investigation of claims and objections to attachment of property:- (1) Where any claim is preferred to, or any objection is made to, the attachment of any property attached under these Rules on the ground that such property is not liable to such attachment, the Sale Officer shall investigate the claim or objection and dispose of it on merits: Provided that no such investigation shall be made when the Sale Officer considers that the claim or objection is frivolous." 16. According to this Rule, the Sale Officer shall investigate the claim or objection and dispose of it on merits. The learned counsel for the Appellants relied upon this rule and contend that the present suit is not maintainable, since the Plaintiff can raise his objection or claim before the competent authority. It is also useful to refer to Rule 140(2), wherein it is stated that when a claim is preferred to property attached under sub rule (1), such a claim should be investigated in the manner and by the authority specified. So, even a third party can prefer a claim with regard to the property attached. Therefore, it is clear that the Plaintiff, a purchaser of the suit property can prefer a claim under Rule 135 of the Tamil Nadu Cooperative Societies Rules, 1988. 17. Reliance was placed on the decision reported in 1997-1-CTC- 378 (Mattadhari Primary Agricultural Coop. Bank Vs. Saroja Ammal and another) by the learned counsel for the Respondent relating to the statutory bar on civil court's jurisdiction under Section 156 of the Act. In the said decision, this court came to the conclusion that the Plaintiff was not a member of Primary Agricultural Coop. Bank and therefore, statutory bar would not operate. The analogy in the decision cited above, which is a finding on a preliminary issue, cannot be made applicable to the case on hand. https://hcservices.ecourts.gov.in/hcservices/ 5 18. At this juncture, it is relevant to refer to Section 152 of the Act, which states about the appeals. The said section contains provisions for an appeal to specified statutory authority by an aggrieved person as defined in the Explanation to sub section (2) against orders passed under certain categorised sections. The said appellate provision is very comprehensive in nature. Section 152(1) of the said Act clearly says that any person aggrieved by any decision or award passed or order made or proceedings taken under sub section (1) of Section 87, sub section (2), Sub section (3) or sub section (4) of Section 90, Section 118, Section 119, Section 143 Section 144 or Section 167 may appeal to the Tribunal. The said right of appeal has been given from orders passed under various provisions. 19. The Honourable Supreme Court in the case reported in 2009-3- MLJ-1032 (A.Balaraman and others vs. The Deputy Registrar of Cooperative Societies, Cheyyar and others) has made it clear that when an appellate provision is provided under the Tamil Nadu Cooperative Societies Act, 1983, which is very comprehensive, any person, who is aggrieved by any of the proceedings mentioned in Section 152(1)(a) of the said Act, can file an appeal. It is laid as follows:- "6. Such principles have been explained by the Honourable Supreme Court in the case of Titaghur Paper Mills Co. Limited Vs. State of Orissa (AIR-1983-SC-603:1983-2-SCC-433) and it is held as follows:- "It is now well recognized that where a right or liability is created by a statute which gives a special remedy for enforcing it, the remedy provided by that statute only must be availed of. This rule was stated with great clarity by Willes, J. in Wolverhampton New Waterworks Co. Vs. Hawkesford (1859-6-CBNS-336 at P.356) in the following passage:- "There are three classes of cases in which a liability may be established founded upon statute... But there is a third class, viz. where a liability not existing at common law is created by a statute which at the same time gives a special and particular remedy for enforcing it..... the remedy provided by the statute must be followed, and it is not competent to the party to pursue the course applicable to cases of the second class. The form given by the statute must be adopted and adhered to." The rule laid down in this passage was approved by the House of Lords in Neville Vs. London Express Newspapers Limited (1919-AC-368) and has been reaffirmed by the Privy Council in Attorney General of Trinad and Tobago Vs. Gordon Grant & Co., (1935-AC-532) and Secretary of State Vs. Mask & Co. (AIR- 1940-PC-105). It has also been held to be equally applicable to enforcement of rights and has been followed by this Court throughout. The High Court was therefore justified in dismissing the writ petitions in limine." 7. In view of the well settled legal principle, it is not possible for this Court to take a different view and go against the order passed by the learned Judge of the writ https://hcservices.ecourts.gov.in/hcservices/ 6 court. We do not find any error in the judgement of the learned Judge of the writ Court..." By applying the said principles laid down by the Honourable Supreme Court to the facts of the case, I am of the considered view that when the remedy is provided under the Act, the Respondent/Plaintiff cannot be permitted to have recourse to the civil court by filing a suit. 20. Having regard to the fact that the Plaintiff had approached the civil court directly without approaching the competent authority by invoking the relevant provisions of the Act, the question is whether the Plaintiff should be deprived of his right to pursue his remedy under the Act. As pointed by the Honourable Supreme Court, Section 152 of the Act provides the hierarchy of authorities, before whom appeals could be filed as against various orders and award, to be passed under the Act and a period of limitation of 60 days is prescribed under Section 152(3) of the Act. The said provision also gives power to the appellate authority to condone the delay in filing such appeal, to entertain the same, in the event of Appellant showing sufficient cause for not preferring the appeal within the said period. Therefore, having regard to the fact that the Plaintiff has been pursuing the remedy before the civil court and it appears to be in a bona fide manner, he can be permitted to file an appeal before appropriate authority. Having regard to the circumstances and the facts of the case, the Plaintiff cannot be deprived of raising his legitimate objections and the Plaintiff is permitted to file an appeal before the appropriate authority within two months from the date of receipt of a copy of the order. If the Respondent/Plaintiff has approached within the said period as specified above, the Appellate Authority shall entertain the appeal on file without insisting on the question of limitation, since the matter was kept pending n this court. 21. In the result, with the above said observations, this second appeal is allowed. However, in the circumstances of the case, there will be no order as to costs. Sd/- Assistant Registrar (RTI) /True Copy/ Sub Assistant Registrar(CS) To: 1.The Subordinate Judge, Kovilpatti 2.The District Munsif, Kovilpatti 3.The Record Keeper, VR Section, Madurai Bench of Madras, High Court, Madurai +1cc to Mr.S.Ponsenthilkumaran, Advocate, Sr.No.39197 srcm GH : 21.11.2011 : 6p/5c Judgement in SA(MD)No.158 of 2008 11.11.2011 https://hcservices.ecourts.gov.in/hcservices/