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  • provisions of section 24 of the Co-operative Society Act (Act II of 1912),
  • section 42. Section 35
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Cites
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Citation Codes
Equivalent Citations
citation codes
Case Number
Judges
Acts
  • provisions of section 24 of the Co-operative Society Act (Act II of 1912),
  • section 42. Section 35
Smart Summary

Factual and Procedural Background

This appeal arises from execution proceedings initiated by the heirs of judgment-debtors. The original suit was filed against a Co-operative Loan Society with unlimited liability, as well as against the society's secretary, chairman, and two members who signed the bond concerning the money lent by the plaintiff. Although the suit was arguably wrongly constituted—since only the Co-operative Society should have been sued—the decree was granted in part against both the Society and the chairman personally. No appeal was filed against the decree, which now stands. The appellants are the heirs of the chairman defendant seeking to challenge execution against them.

Legal Issues Presented

  1. Whether the decree passed against the chairman personally can be set aside or construed as only against the Co-operative Society.
  2. Whether the heirs of the chairman can invoke the protection under section 24 of the Co-operative Society Act (Act II of 1912) to limit their liability for the debts of the Society after the chairman’s death.

Arguments of the Parties

The opinion does not contain a detailed account of the parties' legal arguments.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The court reasoned that although the suit was arguably wrongly framed by joining the chairman and other members personally along with the Co-operative Society, the decree passed against the chairman was valid and final, as no appeal was taken. Therefore, the decree-holder is entitled to execute the decree against the heirs of the chairman.

Regarding the applicability of section 24 of the Co-operative Society Act, the court held that this provision applies only in the context of liquidation proceedings under section 42 of the Act. Sections 35 and following outline the procedure for liquidation, including the Registrar's power to order dissolution under section 39. Only after dissolution and liquidation does the liability of members under section 42 arise, making section 24 operative. Since there was no liquidation or dissolution in the present case, the appellants cannot rely on section 24 to limit their liability.

Consequently, the court found no merit in the appeal and dismissed it with costs.

Holding and Implications

The appeal is dismissed.

The direct effect of this decision is that the decree-holder is entitled to execute the decree against the heirs of the chairman defendant personally. No new precedent was established, and the ruling affirms the finality of the decree and the limited scope of section 24 of the Co-operative Society Act to liquidation scenarios only.

    Kudratulla Sarkar And Others v. Upendra Kumar Chowdhury

    Greaves, J.:— This is an appeal in execution proceedings by the heirs of the judgment-debtors. The suit in which the decree was obtained was a suit against a Co-operative Loan Society with unlimited liability and against the secretary, the chairman and two members who signed the bond in respect of the money lent by the plaintiff in the suit. The suit was, I think, dearly wrongly constituted as the Co-operative Society alone should have been sued. But the suit was decreed in part and, I think, it is clear from the decree and the plaint that the only possible construction that we can put upon the decree is that it was a decree not only as against the Co-operative Society but against the chairman, who as already stated was one of the defendants, personally, and it his heirs who are the appellants before us. Although I think the suit was wrongly framed it is not possible for us in execution be set aside the decree that was passed against the chairman defendant. For some reason or other no appeal was preferred against the decree and that decree accordingly stands, and I think it is impossible for us be construe the decree as we are asked be construe it as merely a decree against the Co-operative Society and as regards the other defendants as merely indicative of their ultimate liability under the provisions of the Act. The first point, I think, accordingly fails and we are bound to hold that the decree-holder is entitled to execute the decree against the heirs of the chairman defendant.

    2. So far as the second point is concerned under the provisions of section 24 of the Co-operative Society Act (Act II of 1912), it is provided that the estate of a deceased member shall be liable for a period of one year from the time of his decease for the debts of the Society as they existed at the time of his decease.

    3. I think the Courts below quite rightly construed section 24 as only coming into operation in liquidation proceedings under section 42. Section 35 and the following sections provide that if the lender has not been paid he may obtain an enquiry by the Registrar who in certain events has the power to order dissolution of the Society under the provisions of section 39 and it is only after the dissolution has been directed under section 39 that the liability of the members under the provisions of section 42, in my opinion, arises and the provisions of section 24, are, as I have already stated, only operative if there has been liquidation of the registered society. I think, therefore the present appellants cannot call in aid the provisions of section 24 as an answer to the claim of the decree-holder be execute the decree.

    4. For the reasons stated, therefore, the appeal fails and must be dismissed with costs.

    5. We assess the hearing fee at one gold mohur.

    Graham, J.:— I agree.

    6. Appeal dismissed.

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    Comments

    Kudratulla Sarkar And Others v. Upendra Kumar Chowdhury
    (Jun 20, 1924)