Find a Lawyer

Regular Second Appeal No. 637 of 1978, decided on 9th December, 1981. Co‑operative Societies Act (VII of 1925)‑

S. 70 read with Civil Procedure Code (V of 1908), O. VII, r. 11(d) Suit against society‑Bar against institution of suit without notice Held, applicable to both members and non‑members‑‑Suit against society by a non‑member without serving prescribed notice‑Held, barred by S. 70 of Act.

Kh. Muhammad Tufail for Appellant .

Asif Sajjad Jan and Nisar Ahmad Butt for Respondents.

Dates of hearing : 11th and 23rd November, 1981.

The appellant, Sunshine Biscuit Limited, is a Private Limited Company with Sh. Rohail Asghar as its Managing Director/Chief Executive. The appellant took industrial loan from respondent No. 2, National Industrial Co‑operative Bank Ltd. Dispute regarding the re‑payment of that loan arose between the appellant and respondent No. 2 which was referred to the arbitration of respondent No. 1, Muhammad Hasan Lodhi. That reference was challenged by the appellant by means of a declaratory suit. Conceding that respondent No. 2 was a society registered under the Co‑operative Societies Act, 1925, hereinafter referred to as the said Act, it was alleged by the appellant that the appellant was not a member of the society and, there fore, the dispute could not be referred to arbitration. Plaint in that suit was, however, rejected by a Civil Judge, under clause (d) of rule 11 of Order VII of the Code of Civil Procedure. His reasoning was .that no notice under section 70 of the said Act was given before the filing of the suit and, therefore, the suit was not competent. First appeal preferred by the appellant was also dismissed by an Additional District Judge. The appellant has; there fore, come up in second appeal to this Court.

2. According to section 70 of the said Act no suit can be instituted "against a society or any of its officers in respect of any act touching they business of the society until the expiration of two months next after notice in writing has been delivered to the Registrar, or left at his office, stating the cause of action, the name, description and place of residence of the plaintiff and the relief which he claims". The plaint is also required to "contain a statement that such notice has been so delivered or left." It is not the case of the appellant that the dispute involved in this case does not relate to the business of the society. It is also not his plea that notice as contemplated by section 70 of the said Act was given before the institu tion of the suit. It has not been provided in section 70 that bar against the institution of suit without notice is applicable to the members of the society but not to the others. It was, therefore, necessary for the appellant to serve the notice in question before filing the suit and since such a notice was not given, the suit was barred by section 70. In this view of the matter, the plaint was rightly rejected by the learned trial Court under clause (d) of rule 11 of Order VII of the Code of Civil Procedure.

3. There is no merit in this appeal. It is dismissed with costs.

S. Q. Appeal dismissed.

Find a Lawyer Near You

Dealing with a matter like this? Connect with a verified advocate in your city — free on SJP Lawyers Directory.