Regular Second Appeal No.2775 of 1983 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Regular Second Appeal No.2775 of 1983 Date of Order: October 24, 2008 Ram Murti & Others ...Appellants Versus The Registrar, Co-operative Societies, Haryana & Others ..Respondents CORAM: HON'BLE MR. JUSTICE RAJIVE BHALLA Present: Mr. R.S.Mittal, Senior Advocate with Mr. Sudhir Mittal, Advocate for the appellants. Mr. L.N.Verma, Advocate for respondents No.5 to 7, 8, 10 to 20. RAJIVE BHALLA, J (Oral). The appellants, challenge the judgment and decree passed by the Additional District Judge, Sirsa, dated 21.07.1983, accepting the appeal filed by the respondents, thereby reversing the judgment and decree passed by the Sub Judge IIIrd Class, Sirsa, dated 24.09.1981 and as a consequence dismissing the suit. The appellants-plaintiffs filed a suit for declaration to the effect that the order dated 26.09.1978 passed by the Assistant Registrar, Co- operative Societies (Recovery Officer), Sirsa, releasing the land sold in auction to the appellants was without jurisdiction, nonest, null and void. In addition, the appellants prayed for grant of a declaration that they have become owners of the aforementioned land on the following facts. Land measuring 209 kanals was attached, so as to satisfy an award, for Rs.72,000/-, passed under the Punjab Co-operative Societies Act, 1961 (as applicable to the State of Haryana)(hereinafter referred to as 'the Act'). The land was sold by way of a public auction to the appellant (since deceased), the highest bidder on 28.08.1978 for a sum of Rs. Regular Second Appeal No.2775 of 1983 -2- 50,000/-. He deposited an amount of Rs.12,500/- on the spot. Another amount of Rs.5,000/- was deposited on 27.09.1978. The Recovery Officer, however, set aside the auction before it could be confirmed, as a relative of the judgment debtor deposited Rs. 52,500/-. In response, the respondents, by way of separate written statements raised a preliminary objection that in view of Section 82(3) of the Act, the suit was barred. In addition, it was pleaded that the respondents could deposit the decretal amount with the recovery officer, before confirmation of the sale and, therefore, the recovery officer did not commit any error in setting aside the auction and releasing the land from attachment. On the pleadings of the parties, the learned trial Court framed the following issues:- 1. Whether the impugned order of the Assistant Registrar is null and void and is liable to be set aside? If so its effect? 2. Whether the suit is not maintainable in the present form? 3. Whether the plaintiffs have no locus-standi to file this suit? 4. Whether the plaintiffs are estopped from filing the suit by their own act and conduct as alleged in the written statement? 5. Whether the Civil Court has jurisdiction to try this suit? 6. Whether the plaint is under valued for purpose of court fee and jurisdiction? 7. Relief. Upon an appraisal of the pleadings, the evidence adduced and the arguments addressed, the trial Court decreed the suit by holding that Regular Second Appeal No.2775 of 1983 -3- the order dated 26.09.1978, passed by the Recovery Officer is illegal, void and without jurisdiction as it is contrary to the provisions of Rule 72(13(1) of the Punjab State Co-operatives Societies Rules, 1963 (hereinafter referred to as 'the Rules'). It was held that as neither the decretal amount nor an amount equal to 5% of the purchase money was deposited, the recovery officer had no jurisdiction to set aside the auction and the sale. As regards, the bar enacted by Section 82 of the Act, to the filing of a civil suit, the trial Court held that as Section 82 commences with the words “save as provided in this Act” , the suit would fall within the meaning of these words and jurisdiction to entertain the suit was not barred as the order was without jurisdiction. Aggrieved by the aforementioned judgment and decree, the respondents filed an appeal. The Additional District Judge, Sirsa, reversed the trial Court's judgment and dismissed the suit by holding that Section 82 (3) of the Act enacted a specific bar to the jurisdiction of civil Court's to entertain such a suit. It was held that as Rule 72 (13)(b)(ii) of the Rules empowers a recovery officer to cancel an auction. Any error in the exercise of his powers under Rule 72(13)(b)(ii) would not render such an order void so as to confer jurisdiction upon a civil court to entertain a challenge thereto. Counsel for the appellants submits that the appellant was the highest bidder. His bid was accepted and he deposited the bid amount. The appellant purchased stamp papers for execution of the sale deed but before the sale deed could be executed, the recovery officer set aside the auction on the ground that one Mani Ram a relative of the judgment debtor had deposited a sum of Rs.52500/- on 25.09.1978. It is submitted that, though, the recovery officer was empowered under Rule 72(13)(ii) to release the land, he could only do so in accordance with the provisions of the aforementioned rule. Before proceeding to cancel the auction and Regular Second Appeal No.2775 of 1983 -4- release the land from attachment, the mandatory provisions of Rule 72(13) (ii) were not adhered to as neither the entire decretal amount nor a sum equal to 5% of the purchase money was deposited. The order passed by the recovery officer was, therefore, void and without jurisdiction. The learned trial court rightly held that as the order passed by the recovery officer was without jurisdiction, the jurisdiction of a civil Court to adjudicate the suit was not barred. The first appellate Court on the other hand did not appreciate the dispute in its correct perspective and proceeded to hold that challenge to the order of release, passed under Rule 72(13(ii) could not be adjudicated by a civil court. It is submitted that the first appellate Court ignored the fact that the recovery officer violated the mandatory provisions of Rule 72(13)(i) of the Rules and thereby committed an error of jurisdiction that rendered his order void ab-initio. It is further argued that the bar contained in Section 82 (3) of the Act, comes into play only where the order passed is in accordance with the jurisdiction conferred. Where the authority, exceeds its jurisdiction or assumes jurisdiction where there is none, the bar contained in Section 82(3) of the Act would not come into play so as to oust the jurisdiction of a civil court to entertain a challenge to such an order. Reliance for the above arguments is placed upon Dhulabhai etc. v. State of Madhya Pradesh and another, AIR 1969 SC 78 and Dhruv Green Field Ltd. v. Hukam Singh and others 2002(6) SCC 416. Counsel for the respondents on the other hand contends that Punjab Cooperative Societies Act, 1961 and the Rules framed thereunder are a complete code in themselves. An order passed by an authority, duly conferred with the powers, by the Act and the Rules cannot be challenged before a civil Court as Section 82(3) enacts a specific bar. It is submitted that Rule 72(13)(ii) empowers a recovery officer to set aside a sale on deposit of the arrears due to the decree holder and a sum equal to 5% Regular Second Appeal No.2775 of 1983 -5- of the purchase money. A sum of Rs. 52500/- i.e. Rs.50,000/- towards auction money and Rs.2500/- towards 5% of the auction money was deposited. The recovery officer, therefore, rightly set aside the auction and released the land. The order passed by the recovery officer is neither without jurisdiction nor illegal for violation of any provision of the Act or the Rules. It is further submitted that the Act provides a complete procedure for filing of appeals/revision and the appellant if aggrieved should have adopted the procedure prescribed under the Act, instead of filing a suit. Where an order is merely erroneous or alleged to violate provisions of an Act or its Rules it cannot be said to suffer from lack of jurisdiction as to confer jurisdiction upon a civil court to entertain a suit challenging its legality. I have heard counsel for the parties and perused the impugned judgments. The substantial question of law that arises for adjudication is:- “Whether the first appellate Court was right in holding that the jurisdiction to entertain the suit was barred in view of Section 82 (3) of the Punjab Co-operative Societies Act, 1961.” The question, therefore, that requires adjudication is whether the civil court could entertain challenge to an order passed by a recovery officer exercising jurisdiction under the provisions of the Act and the Rules. The first appellate Court, accepted the appeal and held that it was no part of the trial Court's jurisdiction to examine whether or not the recovery officer had followed or violated the Rules as Rule 72 (13)(b)(i) confers powers upon a recovery officer to cancel an auction. The learned trial court on the other hand has held to the contrary. Counsel for the appellant accepts the fact that a recovery officer is empowered by Rule 72(13)(b)(ii) to order cancellation of a sale. His submission, however, is that as the recovery officer did not exercise Regular Second Appeal No.2775 of 1983 -6- jurisdiction, in accordance with the rules, a civil Court is, therefore, competent to entertain a challenge thereto despite the express bar enacted by Section 82(3) of the Act. The arguments addressed by counsel for the appellant in my considered opinion cannot be accepted. The Punjab Co-operative Societies Act, 1961 is a complete Code conferring jurisdiction upon a hierarchy of officers to pass orders in accordance with the jurisdiction and powers conferred upon them. Section 68 of the Act confers power of appeal. The State Government or the Registrar are empowered suo-motu or on an application of a party to examine the record of any proceeding in which no appeal lies to the Government or to the Registrar. Section 82 (3) enacts a bar to the jurisdiction of civil or revenue courts and reads as follows:- “82(3):- Save as provided in this Act, no order, decision or award made under this Act shall be questioned in any court on any ground whatsoever.” Section 82(3) postulates that save as provided under this Act no order or decision or award made under this Act shall be questioned in any Court on any ground whatsoever. Section 82(3) is, therefore, categoric in its intent that an order passed under the Act shall not be called into question in any Court on any ground whatsoever. Ouster of the jurisdiction of civil courts, though, frowned upon has been grudgingly accepted by courts. A statutory clause that seeks to oust the jurisdiction of a civil Court shall be constructed strictly but shall not operate where the authority exercising powers appropriates or assumes to itself jurisdiction where there is none or to put it differently, the order impugned discloses an inherent lack of jurisdiction as opposed to a mere erroneous, incorrect or illegal exercise of jurisdiction. An order that discloses an inherent lack of jurisdiction or an illegal assumption thereof would necessarily be Regular Second Appeal No.2775 of 1983 -7- void and therefore, subject to challenge before a civil Court. Section 82 (3) of the Act would not operate to protect such an order from scrutiny by a civil Court.. The judgments relied upon by counsel for the appellant do not suggest that where the infractions are mere errors committed in the exercise of jurisdiction, as opposed to an inherent lack thereof or an illegal assumption thereof, civil Courts would be entitled to entertain challenge to such an order. An officer conferred that jurisdiction, may in the exercise of his powers pass an erroneous or an incorrect order. But this erroneous or incorrect exercise of jurisdiction would not confer power upon a civil Court to entertain a suit challenging such an order where its jurisdiction is specifically barred. Section 72(13)(ii) of the Rules reads as follows:- “72(13)(ii):- If such deposit and [application are made within thirty days from the date of sale, the Recovery Officer shall pass an order setting aside the sale and shall repay to the purchaser the purchase money so far deposited together with the five per cent deposited by the applicant. Provided that if more persons than one have made deposits and applications under this sub-rule, the application of the first depositor to the officer authorised to set aside the sale shall be accepted.” The above rule clearly confers jurisdiction upon the recovery officer to cancel a sale. The recovery officer, passed an order cancelling the auction. The learned trial Court held that the order was illegal as the recovery officer did not comply with the provisions of the rule. The trial Court, in essence, held that the recovery officer committed an error of jurisdiction as opposed to a lack of jurisdiction or an illegal assumption of jurisdiction. The first appellate Court on the other hand rightly held that in Regular Second Appeal No.2775 of 1983 -8- view of the specific bar contained in Section 82(3) of the Act as the recovery officer was conferred with power to pass an order cancelling the auction, the mere fact that he may have committed an error in exercising his powers, would not confer jurisdiction upon a civil court to scrutinise the legality of the order. The case as set out by the appellant is not one of inherent lack of jurisdiction or an erroneous assumption of jurisdiction but one of an incorrect or illegal exercise of jurisdiction. The error, if any, did not entitle the trial Court, in the exercise of its original jurisdiction, to entertain the suit. The first appellate Court, therefore, rightly held that the suit was not maintainable and, therefore, it did not commit any error, that would require interference. The substantial question of law is answered accordingly. In view of what has been stated herein above, the appeal does not merit acceptance and is dismissed with no order as to costs. October 24th , 2008 (RAJIVE BHALLA) nt JUDGE