Case Note & Summary
The dispute arose from the termination of an employee, the respondent, who was initially employed in the Cane Development Department and later transferred to a Co-operative Society. After being acquitted of embezzlement charges, he faced disciplinary proceedings leading to his dismissal. The respondent filed a civil suit challenging the dismissal, which was initially decreed in his favor. However, the First Appellate Court dismissed the suit, asserting that the dispute was 'touching the business of the society' and thus barred from civil court jurisdiction. The High Court reversed this decision, ruling that the dispute fell under the U.P. Sugarcane (Regulation of Supplies and Purchases) Act, 1953, which did not mandate compulsory arbitration for such disputes. The Supreme Court, upon review, held that the respondent was not an 'officer' of the society as defined by the Co-operative Societies Act, thus the civil court had jurisdiction to hear the case. The court emphasized that a dispute arising from disciplinary action does not pertain to the business of the society as defined under the relevant rules, and therefore, the civil court's jurisdiction was not excluded. The appeal was dismissed, affirming the High Court's ruling that the civil court could adjudicate the matter.
Headnote
A) Co-operative Societies Act - Jurisdiction of Civil Court - Disciplinary Proceedings - The civil court has jurisdiction to entertain a suit arising out of disciplinary proceedings against an employee of a co-operative society if the employee is not classified as an officer under the Act. The court held that the definition of 'officer' does not include every employee, and thus the jurisdiction of civil courts is not barred in such cases (Paras 568-570).
Issue of Consideration
Whether the civil court has jurisdiction to entertain a suit arising out of a disciplinary proceeding held by a Cane Growers’ Cooperative Society against its employee.
Final Decision
The Supreme Court dismissed the appeal, affirming the High Court's ruling that the civil court had jurisdiction to entertain the suit. The court held that the respondent was not an officer of the society and that disputes arising from disciplinary actions do not touch the business of the society as defined under the relevant rules.
Law Points
- Jurisdiction of Civil Court
- Disciplinary Proceedings
- Co-operative Societies Act
- Arbitration
- Definition of Officer
Case Details
1980 LawText (SC) (08) 25
Civil Appeal No. 433 of 1977
Desai, D.A., Shingal, P.N.
1981 AIR 152, 1981 SCR (1) 558
A. P. S. Chauhan, Guj Raj Singh Chauhan, T. S. Arora, Indra Makwana
U.P. Co-operative Cane Union Federation Ltd., District Co-operative Sugarcane Development Society Ltd.
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Nature of Litigation
Dispute regarding the dismissal of an employee from a co-operative society.
Remedy Sought
The respondent sought a declaration that his dismissal was invalid and that he continued to be in service.
Filing Reason
The respondent filed the suit after being dismissed from service following disciplinary proceedings.
Previous Decisions
The trial court initially decreed the suit, but the First Appellate Court dismissed it, leading to a reversal by the High Court.
Issues
Whether the civil court has jurisdiction to entertain a suit arising out of disciplinary proceedings held by a Cane Growers’ Cooperative Society against its employee.
Whether the respondent qualifies as an 'officer' under the Co-operative Societies Act.
Submissions/Arguments
The appellants argued that the dispute was between an officer of a co-operative society and the society, thus barred from civil court jurisdiction.
The respondent contended that he was not an officer and that the civil court had jurisdiction to hear the case.
Ratio Decidendi
The court clarified that not all employees are classified as officers under the Co-operative Societies Act, and disputes arising from disciplinary actions do not fall within the jurisdiction of compulsory arbitration, thus allowing civil court jurisdiction.
Judgment Excerpts
The civil court has jurisdiction to entertain a suit arising out of disciplinary proceedings against an employee of a co-operative society if the employee is not classified as an officer under the Act.
A dispute arising out of a disciplinary proceeding resulting in dismissal of an employee of the society cannot be said to be 'a dispute touching the business' of the society within the meaning of the Rule 115.
Procedural History
The respondent filed a civil suit in 1964, which was decreed in 1967. The First Appellate Court dismissed the suit, asserting civil court jurisdiction was barred. The High Court reversed this decision, leading to the Supreme Court appeal.
Acts & Sections
- Co-operative Societies Act, 1912: 2(d), 43
- U.P. Sugarcane (Regulation of Supplies and Purchases) Act, 1953: 28(2n)
