A) ABSTRACT / HEADNOTE
The case of Co-operative Society of Debts v. Nandlal concerns the execution of arbitral awards under the Co-operative Credit Societies Act, 1340 Fasli (Hyderabad). The key issue revolves around the power of the Registrar in post-award execution procedures. Specifically, the judgment explores whether the Registrar, after sending a certified award for execution to a civil court, retains jurisdiction to interfere with execution proceedings, such as by accepting partial payments or issuing directions to civil courts to halt the execution.
The Supreme Court clarified that once the Registrar issues a certificate to a civil court under Section 42 of the Act, he ceases to possess control over the execution process. The Court held that the Registrar does not have the status or powers of a civil court executing its own decree. Execution powers lie solely with the civil court. The Registrar’s intervention post-certification—such as staying execution or condoning default—was deemed ultra vires.
The decision illustrates the doctrine of separation of roles between administrative bodies and judicial authorities in execution matters. It reinforces the autonomy of the executing court once the execution process is initiated through proper certification.
Keywords: Co-operative Credit Societies Act 1340 F., Registrar’s powers, decree execution, arbitral award, default clause, execution court jurisdiction, Hyderabad Law, administrative overreach, civil court, Section 42 powers.
B) CASE DETAILS
i) Judgement Cause Title:
Co-operative Society of Debts v. Nandlal
ii) Case Number:
Civil Appeal No. 374/4 of 1356 Fasli
iii) Judgement Date:
12th October 1950
iv) Court:
Supreme Court of India (Hyderabad Bench)
v) Quorum:
Mehr Chand Mahajan, R.S. Naik JJ.
vi) Author:
Mehr Chand Mahajan, J.
vii) Citation:
1950 AIR (SC) 741, [1950] SCR 741
viii) Legal Provisions Involved:
Section 42 of the Co-operative Credit Societies Act, 1340 Fasli (Hyderabad)
ix) Judgments Overruled by the Case (if any):
None explicitly overruled, but lower court judgments were reversed.
x) Case is Related to which Law Subjects:
Civil Law, Arbitration Law, Administrative Law
C) INTRODUCTION AND BACKGROUND OF JUDGEMENT
This appeal arose under Article 374(4) of the Constitution from a decree passed by the High Court of Hyderabad. It emerged from execution proceedings of an arbitral award rendered under the Co-operative Credit Societies Act. The award had been passed by an arbitrator concerning a debt dispute between a society and its member, Nandlal.
The focal contention involved the Registrar’s competence to interfere with execution after sending the award for enforcement. The appellant-society contended that once the execution was initiated in civil court, the Registrar could not halt proceedings or accept partial payments to stay the execution. The High Court had sustained the Registrar’s intervention, but the Supreme Court overturned that stance.
This case presents a landmark interpretation on the limitation of quasi-judicial powers conferred upon administrative functionaries under special legislation and their interplay with established procedural law under the Civil Procedure Code.
D) FACTS OF THE CASE
Raja Nandlal, a member and debtor of the appellant Co-operative Society, had a dispute resolved under the arbitration mechanism provided in the Co-operative Credit Societies Act, 1340 F.. On 19th Meher 1352 F., the arbitrator passed an award for Rs. 8,100 payable in six monthly instalments, with 6% interest, and with a default clause—making the entire amount due upon default of any instalment.
On 2nd Dai 1353 F., under Section 42 of the Act, a certificate was issued for execution of this award by Moulvi Mohammed Hasan, an officer of the Registrar’s office. The decree-holder filed an execution application in the Civil Court, Balda, for Rs. 10,339 including interest, asserting that default had occurred on the first instalment.
However, the judgment-debtor deposited Rs. 1,000 with the Registrar’s office post-default. Initially, the Registrar refused to accept the deposit due to the default clause. Later, however, the Assistant Madadgar Nazim, Mohammed Aihsan, issued a letter to the civil court, claiming Rs. 1,034 had been deposited and execution should be stayed.
The Civil Court, siding with the Registrar’s request, stayed proceedings. The decree-holder’s appeal to the Sadar Adalat was only partially successful—it ruled that execution could proceed only for future instalments. The High Court confirmed this view but simultaneously declared that the Registrar retained authority to adjourn execution.
This conflicting stance led the decree-holder to appeal to the Supreme Court under Article 374(4).
E) LEGAL ISSUES RAISED
i) Whether the Registrar under Section 42 of the Co-operative Credit Societies Act, 1340 F., retains power to intervene in execution proceedings post-certification?
ii) Whether the Registrar has jurisdiction to accept payments after default and condone default to stop execution?
iii) Whether a decree passed by an arbitrator under the Act is subject to conditional execution in civil courts on Registrar’s discretion?
iv) Whether the execution of an award becomes invalid due to procedural defects in certificate issuance?
F) PETITIONER / APPELLANT’S ARGUMENTS
i) The counsels for Petitioner / Appellant submitted that:
The Registrar had no statutory authority to interfere once execution had commenced in a civil court under Section 42. The power to execute an award vested solely in the civil court, akin to a court executing its own decree under the Civil Procedure Code.
They argued that accepting Rs. 1,034 after default, and thereby stopping execution, violated the default clause in the original award. According to their interpretation, default triggered automatic liability for the entire sum.
They emphasized that under civil procedural jurisprudence, execution is a matter for the executing court alone, and third parties, including the Registrar, cannot issue directions post-certification. The Registrar accepting partial payments outside the executing court was a jurisdictional overreach.
They cited the analogy of Section 38-39 CPC, distinguishing between the court passing the decree and executing it, reinforcing that the Registrar here did not function as an executing court.
G) RESPONDENT’S ARGUMENTS
i) The counsels for Respondent submitted that:
The Registrar retained supervisory control under Section 42, including the power to condone defaults and oversee award execution. The acceptance of the partial instalment indicated his discretion to treat the default as condoned.
They claimed that the original execution process suffered from procedural irregularity as the certificate was issued by a Madadgar Nazim, not the Registrar directly. This defect vitiated the authority of the execution certificate.
They relied on the principle that administrative discretion in co-operative society matters must be liberally construed to promote equity and conciliation. Thus, stopping execution upon part-payment was not illegal.
H) RELATED LEGAL PROVISIONS
i) Section 42 of the Co-operative Credit Societies Act, 1340 F. (Hyderabad):
This section enables the Registrar to enforce arbitral awards through either civil courts or revenue officers via certification. However, it does not grant him the power to execute the award himself or control the civil court’s processes.
“The civil court will treat the award in the same way as its own decree.”
This language implies judicial finality, not continuous oversight.
ii) Civil Procedure Code, 1908 (CPC):
Section 38: Court which passed the decree
Section 39: Transfer of decree for execution
These reinforce that the executing court gains complete control over execution processes.
