Co-operative Court Will Have Jurisdiction To Decide Disputes Regarding Management Of Affairs U/S 91 Maharashtra Cooperative Societies Act: Bombay HC

The Bench of Justice Sharmila U Deshmukh observed, “It is well settled that the Co-operative Court established under the MCS Act is a substitute for Civil Court and the jurisdiction of the Co-operative Court will not go beyond the jurisdiction vested in the Civil Court. The claim of the Petitioner Society was that the Respondents were permissive user of the premises and upon permission being withdrawn, the Respondents were liable to vacate and hand over possession of the premises to the Society. The dispute is not a dispute between the employer and employee regarding the service of the employee but dispute regarding the recovery of the assets of the Society. The scope of jurisdiction of Co-operative Court cannot be wider than the Civil Court. As the Civil Court would have the jurisdiction to grant the relief of recovery of possession of the premises from the user whose permission to use the premises has been withdrawn by the owner, the Co-operative Court would have the jurisdiction to decide the present dispute regarding the management of the affairs of the Society.”

Advocate N. N Bhadrashete appeared for the Petitioner whereas Advocate Vishal C. Ghosalkar appeared for the Respondents.

A writ petition under Article 227 of the Constitution of India was filed assailing the judgment passed in an appeal by the Maharashtra State Co-operative Appellate Court (‘Co-operative Court’), Mumbai allowing the Appeal resulting in quashing and setting aside of the judgment passed by the Trial Court.

The Petitioner Society filed a dispute in the Co-operative Court under Section 91 of the MCS Act seeking eviction of the Respondents from the room reserved by the Petitioner as servant quarters. The Co-operative Court had held that as per the definition of Section 2(k) of the Industrial Disputes Act, the present dispute would not fall within the ambit of Section 91 of the MCS Act 1960.

The primary issue before the Court for consideration was whether the Co-operative Court had the jurisdiction to decide the dispute under Section 91 of the MCS Act.

The Court said that the plain reading of Section 91 of the MCS Act would indicate that Sub-Section (1) of Section 91 is prefaced with a non-obstante clause and provides that a specified class of disputes arising between a specified class of parties can only be referred by any of the parties to the dispute to the Co-operative Court and the subject matter of lis and the parties to the lis must fall within the provisions of Section 91 of the MCS Act.

The Court further added that the claim in the present case arose out of the dispute concerning the assets of the Society which the Society has as its object to maintain and administer, the recovery whereof from the occupier, whose permissive user has been withdrawn by the Society, could have been entertained also by the Civil Court but not by the Industrial Court and as such, the Co-operative Court would have the jurisdiction to entertain and adjudicate the dispute, and therefore the Co-operative Court would have the jurisdiction to entertain and try the dispute.

The Court relied on the judgments of Maharashtra Cooperative Housing Finance Society Ltd. Bombay And Ors., (1984 Bombay) and Nowroji Mansion Co-operative Housing Society vs. Kanta Ruben Narshia & Anr. (2013 Bombay).

The Court concluded, “The claim in the present case arises out of the dispute concerning the assets of the Society which the Society has as its object to maintain and administer, the recovery whereof from the occupier, whose permissive user has been withdrawn by the Society, could have been entertained also by the Civil Court but not by the Industrial Court and as such, the Co-operative Court would have the jurisdiction to entertain and adjudicate the dispute…In light of the above, in my view, the dispute falls within Section 91 of MCS Act and Co-operative Court will have the jurisdiction to entertain and try the dispute.”

Accordingly, the Court quashed and set aside the impugned judgment.

Cause Title: Hemprabha Co-operative Housing Society v. Kishore C Waghela and Ors. (Neutral Citation: 2024:BHC-AS:28760)

Appearances:

Petitioner: Advocate N. N Bhadrashete

Respondents: Advocate Vishal C. Ghosalkar

Click here to read/download the Judgment