1. This judgment will govern Second Appeal No. 184-B of 1934 as well as this case. The main point involved is the same in both cases. We will deal with First Appeal No. 12-B of 1934 first. Defendant 1 is the Co-operative Central Bank of Malkapur. It obtained an award against defendant 2, which is the Jawala Bazar Co-operative Society, from the Registrar of the Co-operative Societies under the rules framed in accordance with Section 43(1) of the Co-operative Societies Act (Act 2 of 1912), in respect of a debt which the Jawala Bazar Co-operative Society owed the Central Bank. Defendant 3 is a member of the Jawala Bazar Society and a portion of his property has been attached in execution of this award which under R. 32 is executable in the same manner as a decree. Defendant 3 did not resist but the plaintiff, who is his son, objected claiming the property as his own and he also set up the usual pleas about the father's illegal and immoral actions. His objection was overruled and so he filed the usual declaratory suit out of which this appeal arises.
2. So far as the facts are concerned, we need not say much because in the view we take, it is unnecessary to go into them. We will content ourselves with stating that we agree with the conclusions of the learned Judge of the lower Court who found all these pleas about illegality and immorality, etc., against the plaintiff. We are left then with this problem. There is an award executable as a decree which is being enforced against the father of a joint Hindu family; the father raises no objection whatever; can the son who was not a party to the award challenge it at the execution stage of the proceedings? We think he can, but only to the extent necessary to protect his own interests. He cannot be allowed to fight his father's battles though he may use the same weapons which his father used or might have used. The position is peculiar. Ordinarily, an objector's interests are not bound up with those of the judgment-debtor and so he cannot challenge the decree in execution. All he can do is to prove that the property attached is his property and not the judgment-debtor's. But in a joint Hindu family the interests of the judgment-debtors and the objectors are often largely interlocked. The interests of all members of a joint Hindu family are usually co-extensive, though some of them may have greater powers than others. Of course, when the judgment-debtor represented, or can be assumed to have represented, the family, or the sons, as the case may be, and the decree or award was against him in that capacity, all would be bound, but when those conditions do not obtain, the others are not bound and they can fight the decree or award in exactly the same way as they could have done if they had been joined in the first instance, because the ground of their liability is the assumption that the father represented them and that therefore they were impliedly parties to the suit: apart from that their interests in the property, which is what the decree-holder wants to proceed against here, would clearly not be liable. They can only be reached through the Page: 436father. Therefore the sons can show that the decree ought never to at all, not even against the father, if it is necessary for them to do so, as it is here. They cannot nullify its effects as against him; the decree will stand so far as he is concerned and his interests will be bound but that will not fetter the sons' rights to protect themselves in every way open to them. The test is always the same though it can be posed in various ways: was the decree obtained against the father person, ally or in a representative capacity? The question was considered by their Lordships of the Privy Council in 51 Bom 450 (1927) 14 AIR PC 56 , 101 IC 44 , 51 Bom 450 , 54 IA 122 (PC) at p. 453, which was a case of a father's decree and also in 36 All 383 (1914) 1 AIR PC 136 , 24 IC 504 , 36 All 383 , 41 IA 216 (PC) at p. 387, a case of a manager. In the latter case, their Lordships of the Privy Council stated that the principle applies even to foreclosure actions. The matter was considered by one of us (Bose, J.) in 31 NLR 352 (1935) 22 AIR Nag 14 , 154 IC 333 , 31 NLR 352 and it was pointed out that even when the decree does not purport on the face of it to be against a manager in his representative capacity, that can be proved by extraneous circumstances and evidence. Execution proceedings against the family property have been successfully resisted on this score in Madras, Allahabad and Lahore in the following among other cases: 8 Mad 208, (1885) 8 Mad 208 10 Mad 316, (1887) 10 Mad 316 12 All 209, (1890) 12 All 209 , 1890 AWN 38 16 All 449 (1894) 16 All 449 , 1894 AWN 169 and 3 Lah 288. (1922) 9 AIR Lah 200 , 66 IC 485 , 3 Lah 288 The two Allahabad decisions are cases in which sons resisted execution in respect of the decrees passed against their fathers: See also, 14 Pat 732 (1935) 22 AIR Pat 275 , 157 IC 53 , 14 Pat 732 , 16 PLT 393 (FB) at p. 758. We are therefore clear that sons can resist in suitable circumstances, and if they can do that, then, they must be allowed to urge in their defence every ground which would have been available to them if they had been joined as parties in the first instance.
3. That brings us to the next question: could the fathers have resisted either at the execution stage or when the award was made? The award is in these terms:
On 1st July 1930 the sum due from the Jawala Bazar Co-operative Society to the Bank was Rs. 36,383-13-9…. I therefore in this my award order that the Jawala Bazar Co-operative Society consisting of the following members or past members all of whom are jointly and severally liable for the debts of the Society pay at once to the Malkapur Central Bank, etc.
4. Then follows a list of members and we find that the plaintiff's father, defendant 3, is among them. On the face of it, this is an award against the Jawala Bazar Co-operative Society alone and not against its members, but we are asked by the Central Bank to construe it as an award against the members as well. A Division Bench of this Court construing a similar award refused to do that in 20 NLJ 6 (1936) 20 NLJ 6 and we have grave doubts whether we can do so either. Even if the language can be regarded as ambiguous and so construed in this sense, not that we think it can, but even if it can when read along with the various rules and circulars to be found in the Co-operative Manual, then the question arises whether it was legally possible for the Registrar to make an award against the members personally for a debt of the Society. We are clear that it was not.
5. As was pointed out in the decision we have just cited:
A Co-operative Society being a statutory corporation is a legal person and its debts are distinct from the liability of its members which members can only be reached by creditors of the corporation in winding up proceedings.
6. This is also the sense in which the Act we are now considering, viz. the Co-operative Societies Act of 1912, and the rules framed under it, have been interpreted by other High Courts. There is for instance a Full Bench decision by five Judges of the Patna High Court in which the matter has been elaborately discussed, 11 Pat 174. (1931) 18 AIR Pat 321 , 134 IC 421 , 11 Pat 174 , 12 PLT 619 (FB) Similar conclusions have been reached in 57 Bom 319, (1933) 20 AIR Bom 191 , 147 IC 1233 , 57 Bom 319 , 35 Bom LR 282 AIR 1925 Cal 203 (1925) 12 AIR Cal 203 , 84 IC 999 , 40 CLJ 254 and Page: 437AIR 1934 Mad 181. South Kanara Central Co-operative Bank, Ltd., (1934) 21 AIR Mad 181 , 150 IC 172 , 66 MLJ 474 But it was contended that the Co-operative Societies in these Provinces differ from those in other parts of India because of bye-law 5 which it was said does not obtain elsewhere. But all that bye-law says is this: “The members of this association are jointly and severally liable for all liabilities of the association.” It says nothing which the Act itself does not say except to make it clear that the liabilities are unlimited. S. 4 contemplates societies with either limited or unlimited liability, so it is necessary to state either in the bye laws or in the rules which of these two alternatives is being adopted, and that is all that bye-law 5 does. In the Patna case a similar provision was embodied in the rules, R. 13; here we find it in the bye-law, that is the only difference. In any case the bye-laws of a statutory corporation cannot travel beyond the powers vested in it by the Act. It is evident from the rulings we have just cited that a body corporate whose members can be made liable for its debts can only be created by statute not even the Crown which can create corporations of another nature has that prerogative. Therefore either the statute must itself define this extraordinary liability or at the very least give the corporation the right to do so in its bye-laws. In no event can the liability of a member for the debts and engagements of such a corporation travel beyond the limits allowed by the statute.
7. That the statute now in question, namely the Co-operative Societies Act of 1912 does not itself give the creditors the right to proceed against a member personally is clear from the decisions on which we have relied. Such members can only be reached in liquidation. In the Patna case the Full Bench held that it was impossible to say that the rule with which they were dealing, (R. 13 in their case), which provides that the members are liable jointly and severally for the debts of the society, entitled the creditors to sue for execution against an individual member. We find it equally impossible to construe bye-law 5 in this sense. We have dealt with this somewhat fully without however covering the same ground as the cases we have quoted, partly because the matter was argued before us at length, but mainly out of deference to the authors of the various Government Circulars which endeavour to interpret the Act. We were referred to Ch. 11, Para. 1(2) and 6 of Part. 2 of the Co-operative Manual issued by the Local Government, pp. 171-173 and told that the idea in these Provinces is that it is neither desirable nor necessary to kill a society by sending it into liquidation for the recovery of money which can easily be obtained by direct execution against the members personally.
8. We are by no means sure that these circulars mean this, but if they do, then we are of opinion that they go too far. As we have said neither the Act nor the rules confer any such powers on the contrary the fact that it was felt necessary expressly to confer these powers on Government by S. 44(2) indicates that they do not exist apart from the Act. It shows in addition that the intention of the Legislature was to confine these privileges to Government. Also a good part of Ss. 36-39 would then be otiose, for, there is no point in prescribing an elaborate procedure with numerous safeguards which a creditor must follow before he can send a society into liquidation if he is allowed to get all that he wants by the simple process of execution. It would all be pointless if the assets of a member could be reached by a creditor direct. We are thus clear on all hands, firstly, that the award in question was not against defendant 3 personally and secondly, that a member's liability, to make good the debts of a society does not arise till liquidation and that therefore thirdly no award in favour of a creditor for a debt of the Society can either be made or enforced against a member personally. It follows that there is no award which can be enforced against defendant 3 and much less against his son, the plaintiff. But we make it clear again that the son cannot fight his father's battle and that he is allowed to set up and establish these pleas in this case only in order to protect his own interests. He cannot obtain a declaration that the entire property is not liable to attachment and sale but only that his half share in it is not so liable. We repeat that we are not concerned here with the father.
9. In addition to these pleas the plaintiff also claimed that the property in dispute was his own separate property because of a partition effected between his father and himself on 30th June 1930. The debt in suit, so far as the father is concerned, did not crystallize as a debt till the date of the Page: 438award which was on 8th October 1930. Till then there was only an inchoate liability. Of course in the view we take, there was no liability even then, but because the father has not contested the execution proceedings it has to be assumed as against him that a personal liability not binding on the sons was brought into existence on that date. But even so, the liability would be post partition and therefore the property assigned to the sons' share before this liability accrued would not be attachable. The lower Court shut out oral evidence of partition, that is to say of a division of the property, because it considered that the two receipts filed amounted to documents of partition and since they were unregistered they could not be used to prove a division of the property by metes and bounds and so it held that no oral evidence could be admitted either.
10. It can be accepted at once that mere lists of property do not form an instrument of partition and so would not require registration, but what we have to determine here is whether these documents are mere lists or in themselves purport to “create, declare, assign, limit or extinguish…. any right, title or interest” in the property which is admittedly over Rs. 100 in value. The question is whether these lists merely contain the recital of past events or in themselves embody the expression of will necessary to effect the change in the legal relation contemplated: 11 Pat 272 (1932) 19 AIR PC 55 , 136 IC 798 , 11 Pat 272 , 59 IA 130 (PC) at p. 279 and 50 Cal 338 (1923) 10 AIR PC 50 , 71 IC 650 , 50 Cal 338 , 1 Rang 66 , 50 IA 77 (PC) at page 345. Ex. P-13 which is one of these documents calls itself a receipt and recites:
As of late you and I have not been palling on smoothly, one joint estate having been privately partitioned through the mediation of panchas and with our consent, the share of each has been put in our respective possession, and we have become separate from each other. According to the said partition, the following moveable, immovable and other properties have been allotted to out respective shares.
11. So far there is no doubt that the document recites a past event. But it must be remembered that in every case in which a transaction is ultimately reduced to writing, negotiations have to be carried on ahead of time and that ultimately finality is reached, before the writing is commenced. There is ordinarily at that stage a complete contract, unless the intention of the parties is that it is not to be binding until formally embodied in a written instrument of title, and unless of course, writing or registration is required by law. Ordinarily, these negotiations are carried on orally and finality is also reached orally. But if the parties intend that the oral contract so concluded should not be binding until embodied in a document, or even at some subsequent stage agree to substitute a written instrument for the oral agreement, then the ultimate contract is deemed to be contained in that instrument alone and no oral evidence of its terms can be given thereafter. This has been dealt with by one of us (Bose J.) at length in Second Appeal No. 251 of 1935, reported in, (1937) 24 AIR Nag 289 , 171 IC 553 , ILR (1938) Nag 31 Therefore these recitals though relevant are not conclusive in themselves. Ex. P-13 after setting out in the utmost detail every item of property moveable and immovable allotted to one side then continues:
I have received all the aforesaid moveable property in my possession. The said moveable and immovable property according to the list, has been allotted to me. I have also received possession of papers, etc. in this connexion. The following moveable and immovable property has been allotted to your share.
12. The words ‘according to the list’ are important. They cannot refer to the document itself, for, apart from the context making that unlikely, the document calls itself a receipt and not a list. The words therefore must have reference to a previous list. If so, then, what was the point in copying out that list again, amplifying it, signing it and attesting it with all the formality of an instrument of title? Unless the document was intended to embody the actual will of the parties and be the sole repository of their intention, all this elaborate procedure would be pointless. The document then concludes:
As all the debts incurred by me have been incurred personally for me, I have undertaken liability to pay all. I am fully responsible for all those debts, or the moveable and immovable property allotted to your share is not at all liable for all these debts. I have taken more land and site, and all the amounts to be received from others in my share and have undertaken liability for all the debts. You are therefore not responsible for any debts. Be it known.
13. The document is then signed and witnessed by no less than four persons. The other document is a counter, part and executed by the other side. We have not the Page: 439slightest doubt that they were not just casual lists but were intended by the parties to embody, and do in fact embody, the actual and legally effective transaction of partition. This we find from a perusal of the document itself. It is perhaps a moot point whether oral evidence is admissible to determine the intention of the parties. It is certainly not admissible if the document is unambiguous, but if there is doubt, then it is permissible and that is what their Lordships of the Privy Council did in similar circumstances in 50 Cal 338 (1923) 10 AIR PC 50 , 71 IC 650 , 50 Cal 338 , 1 Rang 66 , 50 IA 77 (PC) at p. 345. When we turn to the oral evidence, we find that those who were immediately concerned with the document referred to it as “the partition deed.” P.W 1, the scribe, refers to it in those terms and so does P.W 7, who not only attested the document but was one of the panchas called to effect the partition. In the circumstances, there can be no doubt whatever as to what the documents were meant to be. We therefore uphold the finding of the lower Court.
14. The effect of that is that the plaintiff is not able to prove that the property was divided by metes and bounds and that the property now under attachment fell to their share. That is enough for the present purpose. It is immaterial whether the documents can be used to prove a severance of status, for we have already held that the sons' interests are not bound. The decree of the lower Court is reversed and in its place a decree will now be drawn up declaring that the plaintiff's share in the plaint property is not liable to attachment in execution of the award No. 207/30 obtained by defendant 1 against defendant 3 and directing his share be released from attachment. As the plaintiff succeeds he will receive his costs from defendant 1 in both Courts. Defendants 2 and 3 will bear their own costs throughout. We desire to add that the pious obligation rule cannot obtain here because the father's liability which is sought to be enforced was created by the award itself and so cannot be regarded as an antecedent debt. Turning next to Second Appeal No. 184-B of 1935, the facts are a little different but it can be decided along the same lines. The proceedings here are in execution and we are at the objection stage of the case. The decree-holder is the Central Bank of Akola and the judgment-debtor the Co-operative Society of Goregaon Khurd No. 2. The award which is couched in exactly the same terms as before was obtained on 15th January 1926 and in the list of members was one Namdeo who died on 16th November 1929. On 17th December 1930, the registration of the Society was cancelled and a liquidator was appointed. Execution is now sought against respondents 1 and 2 Purushottam and Krishna, who are the sons of Namdeo, under Section 50 of the CPC. Their property has been attached. The liquidator has also been joined and is respondent 3 before us. In this case the Bank has lost, though it had succeeded in the first Court. The Bank is therefore the appellant here.
15. The ground on which its execution application was dismissed by the lower Appellate Court is that of limitation. S. 24 of the Act was applied and it was held that the application having been made more than a year after the death of Namdeo it was barred by time. It is not necessary for us to go into that question because for the reasons already given, we are of opinion that the award was not against Namdeo and could not have been executed against him personally: still less can it be executed against his legal representatives. The fact of liquidation cannot make any difference for, under S. 42, the liquidator is the only person competent to collect the assets of the Society from its members and distribute them rateable among the creditors. This appeal is therefore dismissed. The appellant will pay respondents 1 and 2 their costs. Respondent 3, who is the liquidator and whose interests we are told are the same as the appellants, will bear his own costs as also will the appellant.
V.B.B/R.K
16. Order accordingly.