1. This writ petition has been filed challenging recovery proceedings initiated against the petitioner under the provisions of the Kerala State Co-operative (Agricultural and Rural Development Banks) Act, 1984 (hereinafter referred to as the ‘CARD Act’). According to the petitioner, the provisions of Section 19 of the CARD Act enable a Bank to which the provisions of the said Act apply to bring mortgaged property to sale without the intervention of any Court, and since the provisions of the CARD Act do not create a mechanism for the adjudication of disputes, the provision is arbitrary and unconstitutional. It is contended that the provision is also in conflict with certain provisions of the Kerala Co-operative Societies Act, 1969 (hereinafter referred to as the ‘1969 Act’).
Brief Facts:-
2. The petitioner availed a house maintenance loan from the 6th respondent, a Primary Co-operative Agricultural Development Bank. Alleging default in repayment of the loan, the 6th respondent initiated action under the provisions of the CARD Act and brought the property of the petitioner that was mortgaged to sale. According to the petitioner, the 6th respondent itself purchased the property in the auction for an amount that is considerably below the actual market value of the property. The petitioner also states that the 6th respondent had charged interest on the loan beyond contractual rates.
3. Sri. V. Sethunath, the learned counsel appearing for the petitioner, contends that the provisions of Section 19 of the CARD Act confer unbridled and arbitrary powers on the Primary Credit Societies, as the Societies are empowered to sell properties that have been mortgaged to secure the repayment of a loan without the intervention of the Court and without any adjudication. It is submitted that Banks/Primary Credit Societies like the 6th respondent are therefore empowered to determine for themselves the amount due from the borrower and also to sell the property that has been mortgaged to recover such amount, in some cases even without fixing a reserve price. It is submitted that this Court, in Sosamma John v. Thrissur Co-operative Agricultural and Rural Development Bank and Others, 2018 (2) KHC 498, has taken the view that the sale of property without fixing a reserve price cannot be sustained in law. The learned counsel for the petitioner contends that without resorting to the procedure under Section 69 of the 1969 Act, a Bank/Primary Credit Society exercising powers under Section 19 of the CARD Act cannot proceed to sell properties that are mortgaged.
4. Sri. P. P. Tajudeen learned Special Government Pleader, and Smt. C. S. Sheeja learned Senior Government Pleader appearing for respondents 1 to 5, 7 and 8, would submit that the contention taken by the petitioner cannot be accepted. It is submitted that the Supreme Court in Mardia Chemicals Ltd. and Others v. Union of India and Others, (2004) 4 SCC 311, upheld the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as the ‘SARFAESI Act’), where a similar power has been given to Banks and Financial Institutions to which the provisions of that Act apply to sell properties that are mortgaged/hypothecated etc. without the intervention of the Court. It is submitted that borrowers who are aggrieved by the action of Banks/Financial Institutions under the provisions of the SARFAESI Act have to then approach the Debts Recovery Tribunal by filing an application under Section 17 of the SARFAESI Act, and all contentions have to be adjudicated by the Debts Recovery Tribunal. It is submitted that although Circular No.12/2025 issued by the Registrar of Co-operative Societies indicated that the provisions of Section 69 of the 1969 Act cannot be invoked by a borrower, by a subsequent communication dated 01-11-2025 issued by the Registrar of Co-operative Societies, it has been clarified that the provisions of Section 69 of the 1969 Act can be invoked even by the borrower in the event of any dispute with the Bank/Society. It is submitted that, although the 6th respondent is a Primary Co-operative Agricultural and Rural Development Bank, as it is also a Society registered under the provisions of the 1969 Act, the jurisdiction under Section 69 of the 1969 Act can be invoked in the event of any dispute with the 6th respondent. It is pointed out that no provision in the CARD Act would exclude the jurisdiction of the arbitrator appointed under the provisions of Section 69 of the 1969 Act. It is submitted that all the contentions taken by the petitioner can be properly raised before the arbitrator, and thus the contention of the petitioner that the provisions of Section 19 of the CARD Act are arbitrary and unconstitutional cannot be sustained. It is further submitted that although Section 69 of the 1969 Act can be invoked by the borrowers, the right to raise a dispute must be exercised within a reasonable time. Reference is made in this regard to the decisions of this Court in Thajuddin Shameer v. Secretary Coastal Urban Co-operative Bank Ltd, 2004 (1) KLT 909 and Sarojini Amma v. Trivandrum District Co-operative Bank Ltd, 2005 (3) KLT 655.
5. Heard the learned counsel appearing for the 6th respondent also.
6. On an analysis of the submissions made across the bar, I conclude that the challenge to the provisions of Section 19 of the CARD Act cannot be sustained for reasons indicated below.
7. A Bank to which the provisions of the CARD Act apply is also a Society registered under the provisions of the 1969 Act. Unless expressly or by necessary implication, there is a specific exclusion of any of the provisions of the 1969 Act, such provisions will apply to a Bank to which the provisions of the CARD Act apply. This is clear from the definition of 'Primary Co-operative Agricultural Rural Development Bank' in Section 2(oc) of the 1969 Act, from a reading of Rule 15(1) of the Kerala Co-operative Societies Rules, 1969 (dealing with the ‘Classification of Societies according to types’), as well as from the definitions of ‘Co-operative Society’, ‘Primary Agricultural Credit Society’ and ‘Primary Bank’ in Sections 2(d), 2(g) and 2(h) of the CARD Act. In Irinjalakuda Cooperative Agricultural and Rural Development Bank Ltd. v. Kerala State Cooperative Agricultural and Rural Development Bank Ltd, 2009 (1) KHC 925, this Court took the view that a Bank/Primary Credit Society to which the provisions of the CARD Act apply is a society in terms of the provisions contained in the 1969 Act. It was held:-
“12. The registration of a cooperative society, even as a Primary Cooperative Agricultural and Rural Development Bank, could be had only under the KCS Act and not under the CARD Act since the latter does not deal with the subject of registration but, as rightly pointed out on behalf of the petitioner, the said statute governs the financial relationship between the KSCARD Bank and PCARD Banks, and also provides machinery for recovery etc. The legislative competence to categorize cooperative societies registered or deemed to be registered under the KCS Act into different categories is beyond dispute. Even by primary legislation, different types of cooperative societies are defined ”
Emphasis supplied
Therefore, I have no hesitation to hold that even a Bank/Society to which the provisions of the CARD Act apply will, for all purposes not covered by the provisions of the CARD Act, be governed by the provisions of the 1969 Act.
8. Section 69 of the 1969 Act reads thus:-
“69. Disputes to be decided by Co-operative Arbitration Court and Registrar.- (1) Notwithstanding anything contained in any law for the time being in force, if a dispute arises,-
(a) among members, past members and persons claiming through members, past members and deceased members;or
(b) between a member, past member or person claiming through a member, a past member or deceased member and the society, its committee or any officer, agent or employee of the society; or
(c) between the society or its committee and any past committee, any officer, agent or employee or any past officer, past agent or past employee or the nominee, heirs or legal representatives of any deceased officer, deceased agent or deceased employee of the society; or
(d) between the society and any other society; or
(e) between a society and the members of a society affiliated to it; or
(f) between the society and a person, other than a member of the society, who has been granted a loan by the society or with whom the society has or had business transactions or any person claiming through such a person; or
(g) between the society and a surety of a member, past member, deceased member or employee or a person, other than a member, who has been granted a loan by the society, whether such a surety is or is not a member of the society;or
(h) between the society and a creditor of the society, or
(i) between the co-operative society and its subsidiaries under section 14AA; or
(j) between the members of the partnership formed under Section 14B, such dispute shall be referred to be Co-operative Arbitration Court constituted under Section 70A in the case of non-monetary disputes and to the Registrar, in the case of monetary disputes and the Arbitation Court, or the Registrar, as the case may be, shall decide such dispute and no other Court or other authority shall have jurisdiction to entertain any suit or other proceedings in the respect of such disputes.
(2) For the purposes of sub-section (1), the following shall also be deemed to be disputes, namely:-
(a) a claim by the society for any debt or demand due to it from a member or the nominee, heirs or legal representatives of a deceased member, whether such debt or demand be admitted or not;
(b) a claim by a surety against the principal debtor, where the society has recovered from the surety any amount in respect of any debt or demand due to it from the principal debtor, as a result of the default of the principal debtor, whether such debt or demand is admitted or not;
(c) any dispute arising in connection with the election of the Board of Management or any officer of the society;
Explanation:- A dispute arising at any stage of an election commencing from the convening of the general body meeting for the election, shall be deemed to be a dispute arising in connection with the election;
(d) any dispute arising in connection with employment of officers and servants of the different classes of societies specified in sub-section (1) of Sec.80, including their promotion and inter se seniority.
(3) No dispute arising in connection with the election of the Board of Management or an officer of the society shall be entertained by the Cooperative Arbitration Court unless it is referred to it within one month from the date of the election.
(4) All monetary disputes mentioned in Schedule III to the Act shall be filed within the time limit specified in the said Schedule.”
The fact that Section 19 of the CARD Act begins with a non obstante clause excluding the applicability of the 1969 Act, the Transfer of Property Act and any other law for the time being in force does not in any manner stand in the way of holding that a Society to which the provisions of the CARD Act apply will, for all purposes not covered by the provisions of the CARD Act, be governed by the provisions of the 1969 Act (including the provisions of Section 69 of the 1969 Act) as the non obstante clause in Section 19 is only for the limited purpose of enabling the Bank/Primary Credit Societies to initiate the sale of property mortgaged with the Bank/ Society without the intervention of a Court. Similar provisions are made in the SARFAESI Act as well.
9. At this juncture, it must be noted that the CARD Act does not expressly exclude the jurisdiction of the Civil Court. If the CARD Act is determined to be a standalone Act, then a suit would be maintainable in respect of any action taken under the CARD Act. However, since it has been held that the provisions of the 1969 Act continue to apply to a Bank/Society to which the provisions of the CARD Act apply (unless it is expressly or by necessary implication excluded), Section 100 of the 1969 Act, which specifically excludes the jurisdiction of Civil Courts, will also apply and thus the jurisdiction of the Civil Court stands excluded in respect of all matters arising under the CARD Act.
10. In Mardia Chemicals (supra), the Supreme Court compared the remedy under Section 17 of the SARFAESI Act to a suit under the Code of Civil Procedure, 1908. It was observed:-
“59. We may like to observe that proceedings under Section 17 of the Act, in fact, are not appellate proceedings. It seems to be a misnomer. In fact it is the initial action which is brought before a forum as prescribed under the Act, raising grievance against the action or measures taken by one of the parties to the contract. It is the stage of initial proceeding like filing a suit in civil court. As a matter of fact proceedings under Section 17 of the Act are in lieu of a civil suit which remedy is ordinarily available but for the bar under Section 34 of the Act in the present case. We may refer to a decision of this Court in Ganga Bai v. Vijay Kumar where in respect of original and appellate proceedings a distinction has been drawn as follows: (SCC p. 397, para 15)
“There is a basic distinction between the right of suit and the right of appeal. There is an inherent right in every person to bring a suit of civil nature and unless the suit is barred by statute one may, at one's peril, bring a suit of one's choice. It is no answer to a suit, howsoever frivolous to claim, that the law confers no such right to sue. A suit for its maintainability requires no authority of law and it is enough that no statute bars the suit. But the position in regard to appeals is quite the opposite. The right of appeal inheres in no one and therefore an appeal for its maintainability must have the clear authority of law. That explains why the right of appeal is described as a creature of statute.”
60-61 …………
62. As indicated earlier, the position of the appeal under Section 17 of the Act is like that of a suit in the court of the first instance under the Code of Civil Procedure. No doubt, in suits also it is permissible, in given facts and circumstances and under the provisions of the law to attach the property before a decree is passed or to appoint a receiver and to make a provision by way of interim measure in respect of the property in suit. But for obtaining such orders a case for the same is to be made out in accordance with the relevant provisions under the law. There is no such provision under the Act.”
In the same case, the Supreme Court also held that the failure to establish an adjudicatory mechanism would make the provisions of the SARFAESI Act unconstitutional. It was observed:-
“68. The main thrust of the petitioners as indicated in the earlier part of this judgment to challenge the validity of the impugned enactment is that no adjudicatory mechanism is available to the borrower to ventilate his grievance through an independent adjudicatory authority. Access to justice, it is submitted, is the hallmark of our system. Section 34 of the Act bars the jurisdiction of the civil courts to entertain a suit in matters of recovery of loans. The remedy of appeal available under the Act as contained in Section 17 can be availed only after measures have already been taken by the secured creditor under sub-section (4) of Section 13 of the Act which includes sale of the secured assets, taking over its management and all transferable rights thereto. Virtually it is no remedy at all also in view of the onerous condition of deposit of 75% of the claim of the secured creditor. Before filing an appeal under Section 17 of the Act, decision is to be taken in respect of all matters by the bank or financial institution itself which can hardly be said to be an independent agency; rather they are a party to the transaction having unilateral power to initiate action under sub-section (4) of Section 13 of the Act. So far as remedy under Article 226 of the Constitution of India is concerned, the submission is that it may not always be available since the dispute may be only between two private parties, the banking companies, cooperative banks or financial institutions, foreign banks, some of them may not be authorities within the meaning of Article 12 of the Constitution of India against whom a writ petition could be maintainable. Thus the position that emerges is that a borrower is virtually left with no remedy. Where access to the court is prohibited and no proper adjudicatory mechanism is provided such a law is unconstitutional and cannot survive. In support of the aforesaid contentions besides others, reliance has particularly been placed upon the case L. Chandra Kumar v. Union of India and Surya Dev Rai v. Ram Chander Rai . A reference has also been made to the decision of Kihoto Hollohan. In the case of L. Chandra Kumar it is held, some adjudicatory process through an independent agency is essential for determining the rights of the parties, more particularly when the consequences which flow from the offending Act defeat the civil rights of a party.
69. On behalf of the respondents time and again stress has been given on the contention that in a contractual matter between the two private parties they are supposed to act in terms of the contract and no question of compliance with the principles of natural justice arises nor the question of judicial review of such actions needs to be provided for. However, at the very outset, it may be pointed that the contract between the parties as in the present cases, is no more as private as sought to be asserted on behalf of the respondents. If that was so, in that event parties would be at liberty to seek redressal of their grievances on account of breach of contract or otherwise taking recourse to the normal process of law as available, by approaching the ordinary civil courts. But we find that a contract which has been entered into between the two private parties, in some respects has been superseded by the statutory provisions or it may be said that such contracts are now governed by the statutory provisions relating to recovery of debts and bar of jurisdiction of the civil court to entertain any dispute in respect of such matters. Hence, it cannot be pleaded that the petitioners cannot complain of the conduct of the banking companies and financial institutions for whatever goes on between the two is absolutely a matter of contract between private parties, therefore, no adjudication may be necessary.”
Emphasis is supplied
The remedy under Section 69 of the 1969 Act must, therefore, be viewed as a remedy akin to the remedy under Section 17 of the SARFAESI Act. Thus, in cases where action is taken under the CARD Act, the person aggrieved by such proceedings will be entitled to initiate proceedings under Section 69 of the 1969 Act to have any dispute with the Bank/Society adjudicated. It is only that the role is reversed, just like in proceedings under the SARFAESI Act. Thus, it will be open to the petitioner to invoke the provisions of Section 69 of the 1969 Act if the petitioner has any grievance or dispute that could be adjudicated in terms of the provisions of Section 69 of the 1969 Act, even in a case where action has been initiated under the provisions of the CARD Act. The challenge to the provisions of Section 19 of the CARD Act on the ground that the provisions do not contemplate any machinery for adjudication must, therefore, fail.
11. The challenge to the provisions of Section 19 of the CARD Act must fail for another reason. It is settled law that a statutory provision can be challenged only if :
i. The provision is violative of the provisions contained in Part III of the Constitution of India;
ii. The provision is bad for lack of legislative competence;
iii. The provision violates the Basic Structure of the Constitution of India; or;
iv. The provision is manifestly arbitrary (In Shayara Bano v. Union of India; (2017) 9 SCC 1, the Supreme Court held that a statutory provision can also be challenged if it is manifestly arbitrary. The meaning and content of the term ‘manifest arbitrariness’ has also been elaborated by the Supreme Court in the aforesaid decision. (See paragraph 101 of the SCC Report))
While the learned counsel for the petitioner may be right in contending that the provisions of Section 19 of the CARD Act would be arbitrary if no remedy were available to a borrower facing proceedings under the said provisions to challenge the action of the Banks/Primary Credit Societies, since it is clear that the petitioner can invoke the provisions of Section 69 of the 1969 Act, I find that Section 19 of the CARD Act cannot be challenged on any of the grounds referred to above especially when similar provisions in the SARFAESI Act have been held valid in Mardia Chemicals (supra).
12. As a corollary to the determination of the aforementioned issue, it is imperative to ascertain the period within which proceedings have to be initiated by the borrower under Section 69 of the 1969 Act when proceedings are commenced under the provisions of the CARD Act. Section 69(4) of the 1969 Act (inserted by Act 8 of 2013) reads thus:-
“(4) All monetary disputes mentioned in Schedule III to the Act shall be filed within the time limit specified in the said Schedule”
Thus, the provisions of Schedule III of the 1969 Act do not provide a period of limitation where the borrower wishes to challenge the proceedings initiated under the provisions of the CARD Act.
13. In Ajaib Singh v. Sirhind Cooperative Marketing-cum-Processing Service Society Ltd., (1999) 6 SCC 82, the Supreme Court, while considering the question as to whether any period of limitation has been prescribed in respect of proceedings under the Industrial Disputes Act, 1947 held:-
“10. It follows, therefore, that the provisions of Article 137 of the Schedule to the Limitation Act, 1963 are not applicable to the proceedings under the Act and that the relief under it cannot be denied to the workman merely on the ground of delay. The plea of delay if raised by the employer is required to be proved as a matter of fact by showing the real prejudice and not as a merely hypothetical defence. No reference to the Labour Court can be generally questioned on the ground of delay alone. Even in a case where the delay is shown to be existing, the tribunal, labour court or board, dealing with the case can appropriately mould the relief by declining to grant back wages to the workman till the date he raised the demand regarding his illegal retrenchment/ termination or dismissal. The court may also in appropriate cases direct the payment of part of the back wages instead of full back wages. Reliance of the learned counsel for the respondent management on the Full Bench judgment of the Punjab and Haryana High Court in Ram Chander Morya v. State of Haryana is also of no help to him. In that case the High Court nowhere held that the provisions of Article 137 of the Limitation Act were applicable in the proceedings under the Act. The Court specifically held “neither any limitation has been provided nor any guidelines to determine as to what shall be the period of limitation in such cases”. However, it went on further to say that
“reasonable time in the cases of labour for demand of reference or dispute by appropriate Government to labour tribunals will be five years after which the Government can refuse to make a reference on the ground of delay and laches if there is no explanation to the delay”.
We are of the opinion that the Punjab and Haryana High Court was not justified in prescribing the limitation for getting the reference made or an application under Section 33-C of the Act to be adjudicated. It is not the function of the court to prescribe the limitation where the legislature in its wisdom had thought it fit not to prescribe any period. The courts admittedly interpret law and do not make laws. Personal views of the Judges presiding over the Court cannot be stretched to authorise them to interpret law in such a manner which would amount to legislation intentionally left over by the legislature. The judgment of the Full Bench of the Punjab and Haryana High Court has completely ignored the object of the Act and various pronouncements of this Court as noted hereinabove and thus is not a good law on the point of the applicability of the period of limitation for the purposes of invoking the jurisdiction of the courts/boards and tribunal under the Act.”
(Emphasis is supplied)
Thus, it is evident that when the statute does not prescribe a period of limitation, this Court should not step in to determine or fix any such period of limitation.
14. Regardless of the circumstances, given the nature of the proceedings under the CARD Act and the fact that when property is sold under its provisions, third-party rights may invariably be involved, the rights under Section 69 must be invoked by the borrowers within a reasonable timeframe. The law on the point is well settled. It has been consistently held that when the statute does not prescribe any period of limitation to raise a challenge before any authority, such a challenge must be raised within a reasonable time. This aspect was considered recently by the Supreme Court in North Eastern Chemicals Industries (P) Ltd. v. Ashok Paper Mill (Assam) Ltd., (2023) 19 SCC 798. It was held:-
31. This dispute concerns the exercise of a statutory right. The issue of no express limitation being provided in regard to the exercise of a right to assail the order has captured the attention of this Court, earlier, on certain occasions. We may refer to some decisions hereinbelow.
32. In State of Punjab v. Bhatinda District Coop. Milk Producers Union Ltd., this Court observed that:(SCC p.367 para. 18)
“18. It is trite that if no period of limitation has been prescribed, statutory authority must exercise its jurisdiction within a reasonable period. What, however, shall be the reasonable period would depend upon the nature of the statute, rights and liabilities thereunder and other relevant factors.”
The principle stands reiterated in SEBI v. Sunil Krishna Khaitan.
33. In Jagdish v. State of Karnataka, this Court referred to a number of decisions to reiterate that where the statute in question does not prescribe a limitation, the rights conferred therein must be exercised within reasonable time.
34. This aspect of reasonable time was recently discussed by this Court in Madras Aluminium Co. Ltd v. T.N. SEB, having referred a three-Judge Bench decision in SEBI v. Bhavesh Pabari stating that the concept is to be applied and judged in each case per its own peculiar facts.”
In SEBI v. Bhavesh Pabari, (2019) 5 SCC 90, which was referred to and followed in North Eastern Chemicals Industries (P) Ltd (supra), it was held:-
“35. ……There are judgments which hold that when the period of limitation is not prescribed, such power must be exercised within a reasonable time. What would be reasonable time, would depend upon the facts and circumstances of the case, nature of the default/statute, prejudice caused, whether the third- party rights had been created, etc.”
In Thajuddin Shameer (supra), this court was dealing with the dismissal of two revision petitions filed before the Co-operative Tribunal under the provisions of Section 84 of the 1969 Act as barred by limitation. It was held:-
“…The Legislature has chosen to prescribe periods of limitation for filing appeal under S.82 before the Tribunal, appeal under S.83 before the Government, review before the Tribunal under S.85 and revision before the Government under S.87. Only in the case of revision under S.84 before the Tribunal, the Legislature has chosen not to prescribe any time limit. So revisions were being entertained without any reference to the delay in filing them. There is no decision of this Court directly on this point. But the Tribunal has relied on a decision of the Full Bench of this Court in Moideen Koya v. Kunhammed Haji, interpreting S.20 of the Buildings (Lease and Rent Control) Act to dismiss the revisions. ………..
5. Interpreting this provision, a Single Judge of this Court in Narayanan v. Rent Controller has held that though no time limit was prescribed under S.20, the power of revision should be invoked within a reasonable time limit, say 90 days. If the revision is filed beyond that period, the delay should be satisfactorily explained. The relevant portion of the judgment reads as follows:
"11. It may at this juncture point out that the District Court has committed a gross error in entertaining the Revision Petition filed after a long lapse of 10 years, 7 months and 21 days. It is true that S.20 of the Act does not specify any time limit for approaching the Revisional Court. On the other hand, it enables the District Court at any time to call for and examine the records of the Appellate Authority in relation to any order passed or proceedings taken, for the purpose of satisfying itself as to the legality, regularity or propriety of the said order or proceedings. That does not however mean that the District Court can exercise its jurisdiction at any future time without any limitation whatsoever. The exercise of revisional power is entirely discretionary, and should be in the interests of justice. S.20 does not confer any right on the petitioner but only vests a power in the District Court. It is a privilege conferred on the petitioner, and not a right. The petitioner is therefore expected to be diligent in invoking the revisional power. He must come to court without undue delay - I should say, at the earliest. As noted by a Full Bench of the High Court of Bombay in a case arising under S.622 of the Code of Civil Procedure, 1882, delay in approaching the court is one of the factors on which the exercise of the discretion rests. The court observed:-
'The court will in all cases, regard its exercise of the extraordinary jurisdiction as discretional and subject to considerations of the importance of the particular case, or of an applicant, and of his merits with respect to the case in which the interference of the court is sought.' (Shiva Nathaji v. Joma Kashinath (ILR 7 Bom. 831)
12. Krishna Iyer, J., had occasion to deal with a case where the Revisional Court entertained the revision after a period of two years from the date of the Appellate Authority's order. The Judge observed:
'The revision was filed, as I said earlier, over 2 years after the appeal was disposed of, but was admitted and heard, because by a strange omission in the statute, as both sides submitted, no period of limitation is fixed in the matter of entertaining a revision. Litigation can become a long-acting torment if an order can be challenged years later on the pre text that there is no period of limitation fixed in the statute. Of course, it is for the Legislature to remedy this lacuna, but it is certainly open to the Revisional Court to decline to exercise its discretion when a party moves for relief after a period of indiscrete delay.' (Padmanabha Pillai v. Narayana Pillai)
13. It is well to remember at this stage that the Limitation Act, 1908 had not prescribed any period of limitation for a Revision Petition under S.115 of the Code of Civil Procedure, 1908. Nevertheless it had been the accepted rule of practice and discretion in almost all High Courts that the party aggrieved must approach the High Court for the exercise of its revisional jurisdiction under S.115 within a period of 90 days, namely the period prescribed for filing an appeal. (Vide Mulla on the Code of Civil Procedure 14th Edition, Volume I, page 696, Note 37 and AIR Commentaries on the Code of Civil Procedure 10th Edition Volume Two, page 388, Note 17). This was the conventional period within which any suitor was required to approach the High Court, subject of course to extension of the time on sufficient cause being shown. Any application for revision beyond this period was treated as belated. The Limitation Act of 1963 gave legislative recognition to this conventional period by its Art.131 in the Schedule to the Act. Even a petition under Art.226 of the Constitution has normally to be filed within a period of 90 days. It has been so held in the decisions in Vekitasubramonia Iyer v. Catholic Bank of India Ltd. and Gopalakrishnan v.State of Kerala.
14. When this is the well established practice even in relation to proceedings under S.115 of the Code of Civil Procedure or Art.226 of the Constitution, there is no reason why the Revisional Court should be permitted to deal with a Revision Petition under S.20 of the Act, without any limit of time.
15. It must be observed here that expedition is the watchword in proceedings under the Act. When S.24 hope fully prescribes a period of four months for passing final orders by the Rent Control Court, and S.18 prescribes a bare period of thirty days for filing an appeal and a petition under Art.227 of the Constitution which lies against the order of the Revisional Court has ordinarily to be filed within ninety days, it cannot be that the intermediate authority, namely the Revisional Court alone should have an unlimited period of time within which to exercise its jurisdiction. The words 'at any time' have to be delimited to reasonable levels having regard to prevalent practice and the nature of the power to be exercised. A period of ninety days should be treated as the reasonable time within which an aggrieved party should move under S.20. Any delay thereafter has to be explained satisfactorily before the court can be requested to exercise its discretion in favour of the petitioner.
16. It is axiomatic that any authority exercising discretionary powers should act reasonably. Reasonableness is the touchstone of all judicial and quasi judicial actions. (See in this connection: Secretary of State v. Metropolitan Borough of Tameside (1976 (3) All England Law Reports 665). The District Court functioning under S.20 should therefore, exercise its power in a reasonable manner. Any delay in invoking the power makes its exercise oppressive, arbitrary and unreasonable. Since ninety days has all along been accepted as a reasonable period for invoking the power of revision, the District Court should act only if approached by the aggrieved party within ninety days. That is not to say that it will not, in appropriate cases, where the delay is properly and satisfactorily explained, interfere, or exercise its discretion, even if approached beyond this period. Sufficient cause should be established in all such cases."
6. This decision was followed by a Division Bench of this Court in Thomas v. Mukunda Menon (1992 (2) KLT 9). A Full Bench of this Court in Moideeen Koya v. Kunhammed Haji (1999 (2) KLT 646 FB), considered the above said decisions and held that even if there was delay, court could entertain the Revision Petition, if the same was explained properly.
7. The wordings of S.84 of the Co-operative Societies Act and that of S.20 of the Buildings(Lease and Rent Control) Act are similar, as much as in both the cases the discretion is conferred on the concerned revisional authority to revise the orders, provided the jurisdictional pre-conditions are disclosed. S.29 of the Interpretation and General Clauses Act, 1125 deals with the situation where a power is conferred and no time limit is prescribed for the exercise of the same. The said section reads as follows:
"29. Provisions when no time prescribed:
Where no time is prescribed or allowed within which anything shall be done, such thing shall be done with all convenient speed, and as often as the prescribed occasion arises."
8. The occasion arises in this case only when the facts of a particular case are brought to the notice of the Tribunal. A Tribunal does not normally call for the records of the cases decided by the arbitrators. So, here the delay is occasioned in presenting the facts before the Tribunal to persuade it to exercise its power under S.84. Therefore, the provisions of S.29 will not govern the presentation of the petition for revision, but may govern exercise of power by the Tribunal.
9. Since there is no binding decision on this point under S.84, I think the principle laid down by this Court under S.20 of the Buildings (Lease and Rent Control) Act can be safely followed in this case also. So, if a revision is filed beyond a reasonable time limit, say 90 days, the petitioner should explain in the revision, the reason for the delay. Since there is no limitation prescribed, there need not be any separate petition to condone the delay. The facts which will explain the reasons for the delay should be pleaded in the Revision Petition. If the Tribunal is satisfied that the petitioner was prevented by good reasons from approaching it earlier, the revision can be entertained.” (The decision rendered by this Court in the case of Sarojini Amma (supra) reiterates this position.)
Accordingly, I hold that till the legislature steps in to determine the period of limitation for borrowers to initiate proceedings under Section 69 of the 1969 Act challenging the proceedings initiated under the CARD Act, such applications will have to be filed without undue delay and at any rate within a period of 90 days from the date on which the cause of action accrues. This period is fixed as the reasonable time within which a borrower facing legal proceedings under the CARD Act must initiate proceedings under Section 69 of the 1969 Act taking into consideration the nature of the proceedings, the urgency of a prompt resolution of disputes, and the fact that the proceedings under the CARD Act, which may be challenged by the borrower, invariably involve third-party rights.
15. Since it has been held that borrowers facing proceedings under the CARD Act may initiate proceedings under Section 69 of the 1969 Act, in the event of any dispute, it must also be determined whether the arbitrator will have the power to grant a stay of proceedings pending adjudication of the dispute. Section 70(6) of the 1969 Act empowers the Registrar or any person invested with powers in this behalf to pass necessary interlocutory orders. Further, under Section 98 of the 1969 Act, the Tribunal, Registrar, arbitrator or any other person deciding a dispute under the 1969 Act is vested with all the powers of a Civil Court while trying a suit under the Code of Civil Procedure, 1908 in respect of specified matters. Therefore, the petitioner can seek and obtain necessary interim reliefs during the pendency of the adjudication of the dispute, subject to satisfying the adjudicating authority of the existence of grounds justifying the grant of an interlocutory order staying further proceedings. If an application for interim relief is filed, the competent authority will examine such application on the touchstone of three well-settled parameters viz., prima facie case, balance of convenience and irreparable injury. These principles will govern the exercise of discretion either to grant or refuse an application for interim relief. It is also clarified that the competent authority has the discretion to either deny an interim order or grant a conditional interim order, after evaluation of the specific facts and circumstances of each case.
16. In light of the above findings, this writ petition is dismissed repelling the challenge made to the provisions of Section 19 of the CARD Act. The Registrar of Co-operative Societies shall, if necessary, and taking into consideration the declaration of law in this judgment, issue appropriate orders nominating the competent authority/arbitrator who will have the jurisdiction to consider disputes raised in respect of proceedings under the CARD Act. The dismissal of this writ petition shall not preclude the petitioner from raising all disputes before the arbitrator under Section 69 of the 1969 Act. Since this Writ Petition has been pending before this Court seeking reliefs as aforesaid, the petitioner will be permitted to file a suitable application under Section 69 of the 1969 Act, provided such application is filed before the competent authority within a period of one month from the date of receipt of a certified copy of this judgment.
The Writ petition is ordered accordingly.
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