Sri V.Hanumantha Rao & Ors. v. Sri Lagadapati Rajagopal & Ors.

Order

These Civil Revision Petitions arise out of the orders passed on interlocutory applications in O.P.No.1340 of 2009 on the file of III Additional Chief Judge, City Civil Court, Hyderabad. Since common questions of fact and law are involved in all these revision petitions, they are heard together and are being disposed of by this common order.

2. Background facts in a nutshell leading to filing of these revisions are:- Andhra Pradesh Olympic Association (hereinafter referred to as ‘APOA’) is a Society registered under Societies Registration Act (21 of 1860) now governed under the Andhra Pradesh Societies Registration Act, 2001. It has got its own Constitution, Memorandum of Association and By-laws. Clause 19 of the constitution of APOA deals with election process. The Executive Committee decided in its meeting held on 17.05.2009 to conduct elections to the Executive Committee for a term of four years i.e., from 2009 to 2013. The Executive Committee also appointed A.Ramulu as Returning Officer and K.Ramji as Assistant Returning Officer. The Returning Officer issued election schedule for the posts of President, Vice-Presidents, General Secretary, Joint Secretaries, Treasurer, and Executive Committee Members. Election schedule issued by the Returning Officer is as follows: The date of issue of Nomination Forms

12.00 Noon (Monday) to 08.06.2009 (Monday) to 4.00 P.M. on 01.06.2009 Last Nominations receipt of

5.00 P.M. on 08-06-2009 (Monday) Scrutiny of Nominations

5.00 P.M. on 09-06-2009 (Tuesday) Display of valid Nominations after scrutiny on the Notice Board of A.P. Olympic Association

5.00 P.M. on 10-06-2009 (Wednesday) Last date and time for withdrawals Display of Final List of Nominations on the Notice Board of A.P. Olympic Association Elections (if necessary) Counting of Votes Declaration of Results By 4.00 P.M. on 13-6-2009 (Saturday) 5.00 P.M. on 16-6-2009 (Tuesday) On 21-06-2009 (Sunday) between 2.00 P.M. and 4.00 P.M. followed by counting on 21st June, 2009 (Sunday) Immediately after conclusion of voting. After completing the process of counting on 21-6-2009 (Sunday) Final list of contesting candidates for election to the Executive Committee of the APOA has been notified by the Returning Officer on 16.06.2009 at 5.00 P.M. The final list of contesting candidates is as follows: S.No. Name of Post No. of Posts S.No. Name of the candidates

01. PRESIDENT ONE (1) 02 VICE PRESIDENT FOUR (4) 1 2 3

9. S.KODANDARAMAIAH LAGADAPATI RAJAGOPAL K.E.PRABHAKAR CH.AMAR KUMAR BAJRANG SHARMA Name Association represented VOLLEYBALL ATHLETIC ANDHRA KABADDI BALL ANDHRA BADMINTON AQUATIC DR.BANDA PRAKASH JUDO G.GOPICHAND GUNTUR DOA A.P.JITHENDER REDDY D.KRISHNA DAS SOFTBALL

SRIKAKULAM DOA A.MOGILAIAH KARIMNAGAR DOA A.NARSING RAO WRESTLING C.B.R.PRASAD

10. K.RANGA RAO CYCLING ATHLETIC 03 04 GENERAL SECRETARY ONE (1) JOINT SECRETARIES THREE (3) 05 TREASURER

06. EXECUTIVE COMMITTEE MEMBERS (DOA) ONE (1) FIVE (5) 06 (B) EXECUTIVE COMMITTEE MEMBERS (SSA) TEN (10)

17. G.M.SAMPATH KUMAR S.M. SULTAN L.VENKATARAM REDDY DR.S.VENUGOPALA CHARY B.K.HARANATH K.JAGADISHWER YADAV CHERUKURI SATYANARAYANA P.MALLA REDDY MACHA RAMALINGA REDDY E.MUKESH HYDERABAD DOA TABLE TENNIS VOLLEYBALL ADILABAD DOA HYDERABAD CARROM HYDERABAD KABADDI ARCHERY RANGA REDDY DOA WOMEN CRICKET ATYA PATYA S.R.PREMRAJ SEPAK TAKRAW B.VENKATRAMAIAH WEIGHT-LIFTING K.P.RAO KRISHNA DOA RAMPERSHAD SRIVASTAV R.NARAYANA REDDY ROLLER SKATING ADILABAD DOA K.PADMANABHAM E.G. DOA N.RAJESHWER REDDY T.RAJU M.A.RAWOOF R.SURYANARAYANA M.SWAMY CHARAN MAHABOOBNAGAR DOA MEDAK DOA KURNOOL DOA VIZIANAGARAM DOA WARANGAL DOA BENNY FRANCIS TELANGANA AMATEUR BUILDERS BODY T.HARSHA VARDHAN PRASAD J.JAIRAJ TAEKWONDO KORFBALL B.KAILASH YADAV JUDO P.KANTHAIAH P.MALLESHA HYDERABAD HOCKEY POWERLIFTING PARAG WADHAVKAR WUSHU PHANIRAJ PAMPATI FENCING A.PRASANNA KUMAR REDDY N.POTHURAJU RAMAKRISHNA R.D.PRASAD WOMEN HOCKEY BODY ANDHRA BUILDING ATYA PATYA M.RAMAKRISHNA AQUATIC M.A.SALEEM R.SATYANARAYANA TELANGANA AMATEUR BODYBUILDERS CYCLE POLO S.SOMESHWAR RAO NETBALL K.SURYANARAYANA WEIGHTLIFTING R.VENKATA RAO ANDHRA BADMINTON BALL

18. K.VIJAYA REDDY PRASAD HYDERABAD BALL BADMINTON

3. In the meanwhile a suit being O.S.No.723 of 2009 on the file of the Junior Civil Judge, Visakhapatnam, came to be filed by Visakha Olympic Association represented by its President Sri T.Harshavardhan Reddy to stall the election scheduled on 21.06.2009. One K.P.Rao, Consultant and Secretary, Krishna District Olympic Association also filed O.P.No.1170 of 2009 on the file of the Chief Judge, City Civil Court, Hyderabad, under Section 23 of the A.P. Societies Registration Act, questioning the entire election process commenced by the Returning Officer- A.Ramulu. Visakha Olympic Association and K.P.Rao failed to get any interim orders in the proceedings initiated by them. There was no legal hurdle for holding the election on 21.06.2009. A General Body meeting was convened on the same day. A.Ramulu-3rd respondent rescued himself from acting as Returning Officer. The General Body seemed to have requested Indian Olympic Association Observer Sri Gurbir Singh to act as Returning Officer in place of A.Ramulu. Election as scheduled was not held. The General Body took up various items of agenda including the election to the Executive Committee. Some of the members in the General Body proposed the names of the candidates as office bearers of APOA, for the election of which schedule had already been given, and all the office bearers of APOA were stated to have been elected unanimously. The entire process of electing office bearers of APOA was stated to be in the presence of Gurbir Singh; who has been nominated as independent observer on behalf of the Indian Olympic Association. V.Hanumantha Rao, S.Kodanda Ramaiah, A.Narsinga Rao and Sri M.A.Rawoof have filed O.P.No.1340 of 2009 on the file of III Additional Chief Judge, City Civil Court, Hyderabad challenging the legality and validity of, and the mode and manner in which the election of the President and the General Secretary of APOA was held in Annual General Body Meeting dated

21.6.2009. They also moved I.A.No.2362 of 2009 under Order XL read with Sections 94 and 151 CPC to appoint a Receiver by suspending the self- declared alleged unanimous election of the respondents 1 and 2 (Lagadapati Rajagopal and K.Jagadishwer Yadav) to office bearer posts of President and Secretary of APOA pending disposal of the O.P.; I.A.No.2360 of 2009 under Sections 36 to 39 of the Specific Relief Act read with Sections 94 and 151 CPC to grant ad-interim injunction restraining the respondents 4 and 5 not to grant affiliation/recognition to the self-declared alleged unanimous election of the respondents 1 and 2 to office bearers posts of President and Secretary of APOA pending disposal of the O.P.; and I.A.No.2361 of 2009 under Sections 36 to 39 of the Specific Relief Act read with Sections 94 and 151 CPC to grant ad-interim injunction restraining respondents 1 and 2 or any of their nominees from operating, withdrawing or meddling with the funds of APOA lying in the respondents 6 and 7 Banks pending disposal of the O.P Whereas, Lagadapati Rajagopal-1st respondent in the O.P., filed I.A.No.2850 of 2009 under Sections 7 and 8(1) of the Arbitration and Conciliation Act, 1996 read with Section 21(1) of CPC with a prayer to dismiss the O.P. in view of the arbitration clause contained in Clause 27 of the Constitution of APOA and specific bar contained in Sections 7 and 8(1) of the Arbitration and Conciliation Act, 1996.

4. On behalf of the petitioners in all the I.As, 16 documents were marked as Exs.P-1 to P-16 and on behalf of the respondents, two documents were marked as Exs.R-1 and R-2. On considering the material brought on record and on hearing the counsel appearing for the parties, the learned III Additional Chief Judge, City Civil Court, Hyderabad, by a common order dated 18.08.2009 dismissed all the applications. Hence, the petitioners in O.P.No.1340 of 2009 have filed CRP Nos.4782, 4783 and 4784 of 2009 assailing the orders passed in I.A.Nos.2362, 2361 and 2360 of 2009 respectively and whereas, the 1st respondent in O.P.No.1340 of 2009 has filed CRP No.5692 of 2009 assailing the order passed in I.A.No.2850 of 2009.

5. Heard Sri Unnam Muralidhar Rao, learned counsel appearing for the petitioners in C.R.P.Nos.4782 to 4784 of 2009 and Sri K.G.K.Prasad, learned counsel appearing for the 1st respondent in C.R.P.Nos.4782 to 4784 of 2009 and petitioner in C.R.P.No.5692 of 2009. Sri S. Satyam Reddy, learned counsel appearing for the 2nd respondent in C.R.P.Nos.4782 to 4784 of 2009 adopted the arguments of Sri K.G.K.Prasad.

6. The parties will hereinafter be referred as they are arrayed in O.P.No.1340 of 2009.

7. Learned counsel appearing for the petitioners (petitioners in O.P.No.1340 of 2009) submits that the Returning Officer having issued election schedule ought not have given a go-bye to the procedure contemplated in the election schedule. A further submission has been made that the successor in office of the Returning Officer has to commence the proceedings from where his predecessor left. Once the election schedule has been issued, it is impermissible for the general body to cancel election of office bearers of APOA through ballot papers and put it as one of the items of agenda in the general body meeting. The learned counsel took me to the provisions of the Constitution of APOA. Much emphasis has been laid on Clause 19 of the Constitution of APOA, which reads as hereunder: “19. ELECTION PROCESS: i) The Executive Committee shall decide on the election schedule and appoint a returning officer for the purpose. ii) The General Secretary shall, as per the resolution of the Executive Committee, send notices to all the eligible members, i.e, the members in good standing, as per clause 9, and not otherwise disqualified, enclosing thereto the list of eligible voters, election schedule, nomination forms and the address of the returning officer to whom the nominations are to be sent. iii) The notice shall be despatched to the official address of the members and members of the Executive Committee by registered post with acknowledgement due or delivered personally obtaining acknowledgement, at-least 21 days before the date of the scheduled meeting. iv) The postal receipt of registration or acknowledgement of service of notice shall be deemed to be conclusive and final evidence of despatch and non-receipt of the notice sent so, shall not be a ground for questioning the election held thereafter. v) The acknowledgement by the returning officer in the prescribed form shall be the only evidence for the receipt of nomination form. vi) A candidate, contesting for one office shall not be entitled to contest for another office. vii) Employees of Sports Authority of Andhra Pradesh and Sports Authority of India are not eligible to seek election to the Executive Committee of A.P. Olympic Association or to the Executive Committee of its affiliated units. viii) In case of a contest, the returning officer shall prepare a ballot paper in consultation with the General Secretary. ix) The elections are to be held, by the Returning Officer on the floor of the General Body Meeting of the Association specifically convened for the purpose. Counting is to be carried out in the General Body Meeting and the results of the elections shall be declared there only. The Returning Officer is empowered to appoint Assistant Returning Officers of his choice, from amongst the non- contestants, for assisting him in conducting the elections. The results declared are to be signed by the returning officer and also are to be countersigned by the President of the General Body meeting. The result/results so announced shall be final and binding on all members concerned. x) Voting by proxy is not permissible. xi) Entry to the General Body meeting shall be restricted only to the eligible members in good standing and on production of identification cards issued for the purpose.” The learned counsel would further contend that since election of the respondents 1 and 2 is not in accordance with the provisions of the Constitution of APOA, they are to be restrained from acting as the President and the General Secretary respectively pending O.P.No.1340 of 2009 and a Receiver is to be appointed to manage the affairs of APOA pending the O.P., and that the lower Court has failed to exercise its discretionary power properly and therefore, the same is required to be corrected by this Court in exercise of supervisory jurisdiction under Article 227 of the Constitution of India.

8. In support of his submissions reliance has been placed on the following decisions: 1) Indian Potash Ltd. Vs. Potash Research Institute of India [1] 2) The Church of North India V. The Anglican Church of India[2] (Patna High Court) 3) K.Murugan Vs. Fencing Association of India3 4) Gegong Apang and others Vs. Sanjoy Tassar4 5) A.P. Foot Ball Association Vs. District Foot Ball Association5 6) Manohar Lal Chopra Vs. Raj Bhadur Rao Raja Seth Hiralal6 7) Shavax Vs. Masood Hosain7 8) Naresh Chandra Vs. District Magistrate, Nainital8 9) Shridhar Misra Vs. Jaichandra9 10) Ujjal Vs. Netai Chand Koley10 11) N.Radhakrishnan Vs. Maestro Engineers and others11 12) G.S.Mander Vs. Indian Olympic Association12 13) Andhra Evangelical Luthern Church, Guntur Vs. B.Syamsundar and others13 14) Natraj Studios (P) Ltd. Vs. Navarang Studios14 15) Rajkot Municipal Corporation Vs. State15 16) Jamiruddin Ansari Vs. Central Bureau of Investigation16 17) State of U.P Vs. Tipper Chand17 18) Yeswant Vs. Usha Kumar18 19) Union of India Vs. Naresh Chand19 20) Industrial Credit and Investment Corporation of India Ltd. Vs. Karnataka Ball Bearings Corporation Ltd.20

9. Sri K.G.K.Prasad, learned counsel appearing for the 1st respondent in C.R.P.No.4782 to 4784 of 2009 and the petitioner in C.R.P.No.5692 of 2009 submits that in view of Clause 27 of the constitution of APOA, the dispute among the members of the APOA is required to be settled through arbitration, and, therefore, the O.P filed by the petitioners invoking the jurisdiction of the Court is to be rejected at the threshold. Reference to arbitration under Section 8 of the Arbitration and Conciliation Act, 1996 is peremptory in nature and where an arbitration agreement exists, the Court has to direct the parties to go for arbitration. He would also submit that general body of the association of APOA is the supreme authority and the resolutions passed by the general body cannot be put to judicial scrutiny and none of the members of the annual general body meeting can be permitted to question the resolutions passed on 21.06.2009 including the election of the office bearers of the association. He would further submit that the general body is competent to appoint a successor-in-office of Ramulu, who rescued himself from discharging his duties as Returning Officer and as the members of the general body of APOA elected the office bearers unanimously, their election cannot be questioned by any of the members of the association on whatsoever ground may be. In elaborating his argument, learned counsel would contend that the provisions of Section 23 of the Andhra Pradesh Societies Registration Act, 2001 have to yield to the provisions of Section 8 of the Arbitration and Conciliation Act, 1996 and in which case reference of disputes among members to the arbitrator is mandatory. The learned counsel would also submit that the power of superintendence conferred on the High Court under Article 227 is very limited and in the given facts and circumstances, the trial Court exercised discretion properly in dismissing the applications filed by the petitioners seeking appointment of receiver and restraining the respondents 1 and 2 from discharging the functions as President and General Secretary and therefore, the orders passed by the trial Court do not warrant interference by this Court in exercise of powers under Article 227 of the Constitution of India.

10. In support of his submissions, reliance has been placed on the decisions of the Supreme Court in Thirumuruga Kirupananda Variyar Thavathiru Sundara Swamigal Medical Educational and charitable Trust Vs. State of Tamilandu21, Agri Gold Exims Ltd.Vs. Sri Lakshmi Knits & Wovens22, Rashtriya Ispat Nigam Ltd. Vs. Verma Transport Co.23 and M/s.Jhabbu Mal Jang Bahadur Vs. Nanak Chand Aggrawal and another24 .

11. Learned counsel contends that the 3rd petitioner-A.Narsing Rao has filed memo as well as petition before the District Judge to dismiss the O.P, in so far as he is concerned, and in which case, C.R.P Nos. 4782 of 2009, 4783 and 4784 of 2009 arising out of orders passed in I.A.No.2362 of 2009, I.A.No.2361 of 2009, I.A.No.2360 of 2009 in O.P.No.1340 of 2009 respectively on the file of the III Additional Chief Judge, City Civil Court, Hyderabad are liable to be dismissed. Copies of the memo as well as the petition filed by Narsing Rao before the District Court have been placed on record. Learned counsel appearing for the petitioners in C.R.P.Nos.4782 to 4784 of 2009 filed counter memo on 10.12.2009 with a prayer to treat the three C.R.Ps to have been filed only by petitioners 1, 2 and 4. Subsequently, the learned counsel appearing for the petitioners placed on record another memo withdrawing the earlier counter memo along with a copy of the petition filed by Narsing Rao-3rd respondent in the trial Court. Since the petitions filed by Narsing Rao are stated to be pending in the trial Court, I have chosen to ignore the memos and counter memo filed by the parties for the purpose of deciding these revisions on merits.

12. I do not want to burden the judgment by referring the proposition of law laid down in the judgments cited by the learned counsel appearing for the parties. It is suffice to refer some of the judgments cited by the learned counsel.

13. In Shridhar Misra Vs. Jaichandra (9 supra), the Allahabad High Court held that ordinarily the Civil Court will not interfere with the internal management of a Society registered under the Societies Registration Act at the instance of some of the members of the Society. But this rule is subject to the following exceptions: (1) where the impugned action is ultra vires the Society; (2) the act complained of constitutes a fraud; and (3) where the impugned action is illegal. If a case falls under any of these exceptions, it is open to some of the members of the Society to file a suit in the Civil Court challenging the act done in the name of the Society.

14. In Agri Gold Exims Ltd. Vs. Sri Lakshmi Knits & Wovens (22 supra), the Supreme Court held that in view of proviso to Section 8 of the Arbitration and Conciliation Act, 1996 wherever arbitration agreement exists, the Court is under obligation to refer the parties to arbitration.

15. In Rashtriya Ispat Nigam Ltd. v. Verma Transport Co., (23 supra) , the Supreme Court considered the distinction between Section 34 of the repealed 1940 Act and Section 8 of 1996 Act and held as hereunder: Section 34 of the repealed 1940 Act employs the expression `steps in the proceedings’. Only in terms of Section 21 of the 1940 Act, the dispute could be referred to arbitration provided the parties thereto agreed. Under the 1940 Act, the suit was not barred. The Court would not automatically refer the dispute to an Arbitral Tribunal. In the event, it having arrived at a satisfaction that there is no sufficient reason that the dispute should not be referred and no steps in relation thereto was taken by the applicant, it could stay the suit. Section 8 of the 1996 Act contemplates some departure from Section 34 of the 1940 Act. Whereas Section 34 of the 1940 Act contemplated stay of the suit; Section 8 of the 1996 Act mandates a reference. Exercise of discretion by the judicial authority, which was the hallmark of Section 34 of the 1940 Act, has been taken away under the 1996 Act. The direction to make reference is not only mandatory, but the arbitration proceedings to be commenced or continued and conclusion thereof by an arbitral award remain unhampered by such pendency. Section 8 of the 1996 Act is peremptory in nature. In a case where there exists an arbitration agreement, the Court is under obligation to refer the parties to arbitration in terms of the arbitration agreement.

16. The proposition of law laid down in Abdul Kadir Shamsuddin Bubere Vs. Madhav Prabhakr Oak and another[ AIR 1962 SC 406] and Haryana Telecome Ltd. Vs. Sterlite Industries (India) Ltd. [ AIR 1999 SC 2354] has been referred with approval in N.Radhakrishnan Vs. Maestro Engineers and others [12 supra], and it has been held as hereunder:- “Sub-section (1) of Section 8 provides that where the judicial authority before whom an action is brought in a matter, will refer the parties to arbitration the said matter in accordance with the arbitration agreement. This, however, postulates, in our opinion, that what can be referred to the Arbitrator is only that dispute or matter which the Arbitrator is competent or empowered to decide”.

17. In Andhra Evangelical Luthern Church, Guntur Vs. B.Syamsundar and others (13 supra), a learned Single Judge of this Court considered Section 23 of the A.P. Societies Registration Act, 2001 and observed as hereunder:- “ The Andhra Pradesh Societies Registration Act, 2001 is a comprehensive enactment, which deals with the registration, management, administration, dissolution and winding up of the societies in the State of Andhra Pradesh. The provisions of the present Act govern the activities of such societies in all aspects. In view of the language of sub-section (2) of section 32, the activity of those societies registered under the repealed enactments also is governed by the provisions of the new Act of 2001. Section 23 of the Act deals with the disputes regarding the management. The disputes arising among the “committee” which is defined to mean a body of the persons to whom the management of the society is entrusted by its bye-laws or the members of the society in respect of any matter relating to the affairs of the society is required to be resolved under the provisions of either the Arbitration and Conciliation Act, 1996 or by filing an application to the District Court concerned. Therefore, in my view, the jurisdiction of the Civil Courts to entertain the disputes, which would fall within the ambit of Section 23 of the Act, is by a necessary implication barred. The dispute involved in the present case is in my view squarely falls within the ambit of Section 23 of the Andhra Pradesh Societies Registration Act, 2001 extracted above. The legal principle regarding the exclusion of the jurisdiction of the Civil Court fell for consideration of their Lordships of the Supreme Court in the decision reported in Venkataraman & Co. Vs. State of Madras [AIR 1966 SC 1089]. A Constitutional Bench of majority held as follows: “If a statute imposes liability and creates an effective machinery for deciding questions of law or fact arising in regard to that liability, it may, by necessary implication, bar the maintainability of a civil suit in respect of the said liability….”

18. M/s. Jhabbu Mal Jang Bahadur Vs. Nanak Chand Aggrawal (24 supra), it has been held that whether a matter should be referred to arbitration or not will also be a difference arising out of the agreement capable of being resolved by arbitration. Paragraph 3 of the judgment needs to be noted and it is thus:- “ I have heard Mr.Ahluwalia. It appears to me that the present arbitration court even be covered by the original arbitration clause because in every difference one party is in the right and the other is in the wrong, and it is only when there has been an effective adjudication that the right to arbitrate under a clause like this ceases to exist: Chandan Mull Vs. Donald Cambell (1919)23 Cal WN 707 at p.713 (PN HL). Moreover, the Courts below have overlooked the agreement contained in Ext.P3 itself by which the parties had agreed to refer any dispute out of their mutual accounts to the arbitration of the said Association or their nominee. An award made on such an agreement was good, whether it was made on the original contract or the settlement contract; vide Uttam Chand Sailgram Vs. Mahmood Jewa Mamooji, (1919) 23 Cal WN 704: (AIR 1920 Cal 143). Mr. Ahluwalia also pointed out that in Madan Lal v. Sunder Lal, AIR 1967 SC1233, the Supreme Court has held that if a party wants an award to be set aside on any of the grounds mentioned in S.30 of the Act, it must, after receipt of notice, make an application to that end. If no such application is made, the award cannot be set aside on any of the grounds specified in that Section. I wonder if the Courts can set aside an award suomotu under S.17 of the Act, but assuming that they can do so, they could not have done so in this case. When a man is under a liability and keeps silence even after service of a notice, he should be presumed to be differing with the claimant and that will be a difference within the meaning of S.2(a) of the Act. Difference is such a wide term that it can include almost everything on which the parties are not at one: vide Ghulam Qadir Baksh vs. State of Jammu and Kashmir, AIR 1972 J and K 44. Whether a matter should be referred to arbitration or not will also be a difference arising out of the agreement capable of being resolved by arbitration. Relying upon Pearl Hosiery Mills v. Union of India, AIR 1979 Delhi 64; National Small Industrial Corporation Vs. Punjab Tin Print, 1979 Rajdhani LR 289: (AIR 1979 Delhi 58) and Hindustan Copper v. Assam Bearing 1980 Rajdhani LR (Note) 29: (AIR 1980 Delhi 238), I have held in Prem Kumar v. Harbans Singh, FAO 255/80 decided on April 22, 1981 [Reported in 1981 Rajdhani LR 652] that dispute means that One party has a claim and the other party says for some specific reason that this is not a correct claim. What is to be seen is whether there has been a breach by one side or the other or whether circumstances have arisen which have discharged one or both parties from further performance; Union of India v. Birla Cotton Spinning and Weaving Mills, AIR 1967 SC 688 para 8. If one party asserts in right and the other repudiates, that is a dispute. It is analogous to a cause of action; vide Jammu Forest Co. Vs. State of Jammu and Kashmir, AIR 1968 J AND K 86, and Nandram Hanutram Vs. Raghunath and Sons Ltd., AIR 1954 Cal 245. Although it is true that there can be no arbitration without a difference, yet it appears to me that the Courts below have fallen into error in invalidating the award on the ground that there was no dispute or difference”.

19. In view of the rival contentions of the parties, the issues that arise for consideration are:-

1. Whether O.P.No.1340 of 2009 filed by the petitioners questioning the election of President and General Secretary of APOA is maintainable?

2. Whether the petitioners made out valid grounds for appointing a Receiver to discharge the functions of the President and the General Secretary of APOA?

3. Whether the petitioners are entitled for temporary injunction pending disposal of the O.P restraining the respondents 1 and 2 or their nominees from operating/withdrawing or meddling with the funds of APOA lying in the respondents 6 and 7 banks pending disposal of the O.P.?

4. Whether the petitioners are entitled for temporary injunction restraining the respondents 4 and 5 from granting affiliation/recognition to the self-declared alleged unanimous election of respondents 1 and 2 to office bearer posts of President and the General Secretary of APOA.

20. ISSUE No.1: Three provisions are required to be noted at this juncture and they are:- i) Section 23 of the Andhra Pradesh Societies Registration Act, 2001; ii) Section 8 of the Arbitration and Conciliation Act, 1996 and; iii) Clause 27 of the Constitution of APOA. Section 23 of the Andhra Pradesh Societies Registration Act, 2001 reads as hereunder:-

23.Dispute regarding management:- In the event of any dispute arising among the Committee or the members of the society, in respect of any matter relating to the affairs of the society, any member of the society may proceed with the dispute under the provisions of the Arbitration and Conciliation Act, 1996, (Central Act 26 of 1996) or may file an application in the District Court concerned and the said Court shall after necessary inquiry pass such order as it may deem fit. Section 8 of the Arbitration and Conciliation Act, 1996 read as hereunder:-

8.Power to refer parties to arbitration where there is an arbitration agreement:- (1) A judicial authority before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration. (2) The application referred to in sub-section (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof. (3) Not withstanding that an application has been made under sub-section (1) and that the issue is pending before the judicial authority, an arbitration may be commenced or continued and an arbitral award made. Clause 27 of the Constitution of APOA reads as hereunder:- “In the event of any dispute arising between the Association and/or its members and/or between sports persons, officials, units and/or its members and/or between members who are within the purview of this Association on any matter whatsoever, the same shall be settled by arbitration only, under the provisions of the Arbitration and Conciliation Act, 1996 (Central Act 26 of 1996). The decision of the Arbitration Committee shall be final and binding on all the parties and no member OR unit of any. Member or other persons who are under the purview of the Association shall approach any Court of Law without referring a dispute for arbitration.

21. It is also pertinent to note Clause 17 of the Constitution of APOA which deals with SUB-COMMITTEES and it is thus:- i)The Executive Committee, in it’s first meeting immediately after the elections, shall appoint the following Committees: a. Disciplinary Committee b. Finance Committee c. Rules Committee d. Building Committee e. Arbitration Committee ii) The executive committee may in addition appoint such other sub committees, as it may think fit from time to time. Each committee will have one Chairman and one Convener. The President and the General Secretary of the Association shall be the ex-officio members of all the sub-committees except the Disciplinary Committee.

22. Sri K.G.K.Prasad, learned counsel by emphasizing Clause 27 of the Constitution of APOA contends that the dispute as to the election of the office bearers of the APOA is required to be settled by way of arbitration. He would also contend that in view of some conflict between Section 8 of the Arbitration and Conciliation Act, 1996 and Section 23 of the Andhra Pradesh Societies Registration Act, 2001, the provisions of Section 8 of the Arbitration and Conciliation Act, 1996 have a precedence, it being a Central enactment and whereas the Andhra Pradesh Societies Registration Act, 1996 being a State enactment, by virtue of Clause (4) of Article 254 of the Constitution of India.

23. In support of his submissions, reliance has been placed on the judgment of Thirumuruga Kirupananda Variyar Thavathiru Sundara Swamigal Medical Educational and charitable Trust Vs. State of Tamilandu, (21 supra), wherein it has been held that (1)If any provision of a law made by the Legislature of a State is repugnant to any provision of a law made by Parliament which Parliament is competent to enact, or to any provision of an existing law with respect to one of the matters enumerated in the Concurrent List, then, subject to the provisions of clause (2), the law made by Parliament, whether passed before or after the law made by the Legislature of such State, or, as the case may be, the existing law, shall prevail and the law made by the Legislature of the State shall, to the extent of the repugnancy, be void. (2)Where a law made by the Legislature of a State with respect to one of the matters enumerated in the Concurrent List contains any provision repugnant to the provisions of an earlier law made by Parliament or an existing law with respect to that matter, then, the law so made by the Legislature of such State shall, if it has been reserved for the consideration of the President and has received his assent, prevail in that State: It is further held that Clause (1) of Article 254 gives overriding effect to the provisions of a law made by Parliament which Parliament is competent to enact or to any provision of any existing law in respect of one of the matters enumerated in List III and if a law made by the Legislature of the State is repugnant to the provisions of the law made by Parliament, the law made by the Legislature of the State is to be treated as void to the extent of repugnancy. Clause (1) is, however, subject to clause (2). Under clause (2), the law made by the Legislature of a State with respect to one of the matters enumerated in List III will prevail over the provisions of an earlier law made by Parliament or an existing law with respect to that matter if the law made by the Legislature of the State has been reserved for consideration by the President and has received his assent. The proviso to clause (2) curtails the ambit of clause (2) by providing that Parliament can enact a law with respect to the same matter on which the Stat Legislature has made the law and by such law the Parliament can add to, amend, vary or repeal the law made by the Legislature of a State. The provision corresponding to Article 254 was contained in Section 107 of the Government of India Act, 1935. The only difference between that provision and Article 254 is that there was no provision similar to the proviso to clause (2) of Article 254 in Section 107 of the Government of India Act, 1935. As a result of the proviso in Article 254, the legislative power of Parliament has been enlarged in the sense that it can add to, amend, vary or repeal the law made by the Legislature of the State.

24. Even assuming that the dispute with regard to election of the office bearers of the APOA is required to be adjudicated by arbitration committee, as per Clause (17) of the Constitution of APOA, President and General Secretary of the association shall be the Ex-officio members of all the sub committees except the disciplinary committee. Arbitration Committee is one of the sub committees. If the dispute with regard to election of the President and General Secretary is required to be adjudicated by arbitration committee, the very same President and General Secretary have to participate in arbitral proceedings as ex-officio members of the committee. It is well settled that one cannot be judge of his own cause. The concept of natural justice entails two ideas: (i) Nemo Judex in re sua, i.e. the authority deciding the matter should be free from bios; and (ii) audi alteram partem, i.e., a person affected by a decision has a right to be heard. The maxim nemo judex in re sua literally means that a man should not be a judge in his own cause. This is known as the rule against bias. That bias disqualifying an individual from acting as Judge flows from two principles: (1) No one should be a judge in his own cause; and (2) Justice must not only be done but seen to be done. A conjoint reading of all the provisions of the Constitution of APOA indicates that the dispute with regard to election of office bearers of APOA stands outside the scope of Clause (27) of the Constitution of APOA.

25. A close reading of Section 23 of the Andhra Pradesh Societies Registration Act, 2001 and Section 8 of the Arbitration and Conciliation Act, 1996 indicate that there is no conflict between these two provisions. Section 23 of the A.P. Societies Registration Act gives an option to any member of the society to invoke either the provisions of the Arbitration and Conciliation Act or prefer an application before the District Court concerned for resolution of the dispute. There is nothing in the Section to infer that in case of any dispute, the same is required to be resolved only by way of making an application under the provisions of Arbitration and Conciliation Act. Section 8 of the Arbitration and Conciliation Act comes into operation when there is an agreement between the parties to get the dispute resolved only by way of invoking the provisions of the Act. Therefore, the contention of the learned counsel appearing for the respondents 1 and 2 that there is repugnancy between the provisions of Section 23(2) of A.P. Societies Registration Act and Section 8 of Arbitration and Conciliation Act cannot be sustained.

26. Section 23 of the A.P. Societies Registration Act fell for consideration before the learned Single Judge of this Court in Andhra Evangelical Luthern Church, Guntur Vs. B.Syamsundar and others (13 supra), wherein it has been held as hereunder:- “ It can be seen from the above, the disputes arising among the “committee” which is defined to mean a body of the persons to whom the management of the society is entrusted by its bye-laws or the members of the society in respect of any matter relating to the affairs of the society is required to be resolved under the provisions of either the Arbitration and Conciliation Act, 1996 or by filing an application to the District Court concerned. Therefore, in my view, the jurisdiction of the Civil Courts to entertain the disputes, which would fall within the ambit of Section 23 of the Act, is by a necessary implication barred. The dispute involved in the present case is in my view squarely falls within the ambit of Section 23 of the Andhra Pradesh Societies Registration Act, 2001 extracted above.” In view of the above discussion, I find that O.P.No.1340 of 2009 filed by the petitioners questioning the election of President and General Secretary is maintainable.

27. ISSUE Nos.2 to 4: The cardinal principles to be considered for granting an injunction are:- (1) Prima facie case ; (2) Balance of convenience and (3) Irreparable injury In Dalpath Kumar Vs. Prahlad Singh [1992 (1) SCC 719], the Supreme Court held that all the three conditions are to be satisfied without emphasizing any one among the three. Prima facie case means a bonafide contention between the parties or serious questions to be tried; Balance of convenience means weighing competing possibilities or probabilities of likelihood of injury, i.e., amount of substantial mischief or injury, which is likely to be caused if injunction is refused and comparing it with that which is likely to be caused to the other side if injunction is granted. Whether it would cause great inconvenience to the petitioners if the injunction were not granted than the inconvenience which the opposite party or persons claiming through the opposite party would be put to if the temporary injunction were granted. Irreparable injury means a material injury that cannot be adequately compensated by way of damages, but does not mean that there must be physical possibility of repairing the injury. The Madras High Court in Krishna Swamy Vs. Thangavelu [AIR 1955 MADRAS 430] laid down five principles, which are described as Panch Sadachar of Court exercising equity jurisdiction to appointment of receiver pending the suit. (1) The appointment of receiver in a pending suit is a matter resting in the discretion of the Court; (2) The Court should not appoint a receiver except upon proof that prima facie that the plaintiff has a very excellent chance of succeeding in the suit; (3) Apart from some conflicting claim to the property the plaintiff must loss demanding show some emergency or danger or immediate action and therefore the element of danger is an important consideration; (4) Where the property is shown to be in media, that is to say in the enjoyment of none; (5) The conduct of the party who made the application shall be free from blame. The above five principles have been reiterated by our High Court in Mangamma Vs. Brahma Reddy [1989(1) ALT 331].

28. In Naresh Chandra Vs. District Magistrate, Nainital’ case (8 supra), the Allahabad High Court held that in the case of falsehood and fraud by a party to a legislation, any Court has a power inherent to protect itself and further stall the perpetuation of fraud, nicety of Law and the Court’s reception to it are for those who come clean and parties harbouring falsehoods and deceit are to be shown the door out of Court.

29. APOA is governed by its own Constitution. The Constitution is a contract between the Society and its members and the Society is bound by its own Rules including the Rule with regard to election of the managing committee. It is not in dispute that the executive committee appointed the 3rd respondent- Ramulu as Returning Officer for conducting election to the posts of office bearers of the APOA for the years 2009 to 2013. Final list of contesting candidates for election to the Executive Committee has also been notified by the Returning Officer. As seen from the notification, dated 16.6.2009, there is a contest for each post. In case of contest, the returning officer shall prepare a ballot paper in consultation with the General Secretary. Annual General Body meeting came to be convened on 21.6.2009. It is evident from sub-clause (ix) of Clause 19 that the elections are to be held, by the Returning Officer on the floor of the General Body Meeting of the Association specifically convened for the purpose. Counting is to be carried out in the General Body Meeting and the results of the elections shall be declared there only.

30. The election procedure enumerated in Clause 19 does not give any room for doubt that once there is a contest, election is to be held through ballot papers. Prima facie, General Body cannot usurp the power of the Returning Officer and proceed with the election of office bearers by way of nominations. The way in which the respondents 1 and 2 have been elected as President and General Secretary of `APOA’ indicates that it is contrary to sub-rule (ix) of Clause 19. Of course, it is the contention of Mr.K.G.K.Prasad, learned counsel appearing for the respondent No.1 in C.R.P.Nos.4782 to 4784 of 2009 that the General Body is the Supreme body and it can elect the office bearers of the association.

31. I have gone through the copy of the caveat filed by the 2nd respondent K.Jagadishwar Yadav in the Court of Chief Judge, City Civil Court, Hydeabad, which has been marked as Ex.P-13. In paragraph (3) of the affidavit filed in support of the petition, it is stated as hereunder:- “ It is humbly submitted that the 1st respondent herein has unsuccessfully filed his nomination to the post of President of the Andhra Pradesh Olympic Association. The returning officer of the election, inadvertently has accepted his nomination. The same was rejected by the General Body. One Sri K.E.Prabhar, M.L.A., who has filed his nomination to the post of President, withdrew from the contest. Hence, Sri L.Raja Gopal only remained in the contest to the post of President. Therefore, the General Body has unanimously elected him as its President. Sri B.K.Harnath has filed his nomination to the post of General Secretary of the Andhra Pradesh Olympic Association. He withdrew his nomination and hence the caveator herein has only remained in the contest as such he got elected unanimously to the post of General Secretary on 21-06-2009”.

32. In the counter affidavit filed in the I.A.Nos.2360, 2361 and 2362 of 2009, the 2nd respondent K.Jagadishwer Yadav stated in paragraph 16 as hereunder:- 16) In reply to para-19, I submit that because of the unruly behaviour of the first petitioner, the Returning Officer has withdrawn himself from the responsibility in the midst of the the Electoral College unanimously elections and resolved to give the responsibility to the Observer appointed by Indian Olympic Association which is supreme body since there therefore was unanimity amongst the members. The election was conducted between 2.00 PM and 4.00 PM”.

33. The plea taken by the 2nd respondent in the counter substantially differs from the plea taken by him in the caveat petition. Be that as it may, no election was held pursuant to the election schedule issued by the Returning Officer. Even if, there is any change of the Returning Officer, the successor in office of the Returning Officer has to commence the proceedings from where his predecessor left. When the list of contesting candidates has been finalized and notified, it is not within the purview of the Annual General Body meeting to give a go-bye to the election schedule and usurp the role assigned to the Returning Officer. The procedure adopted by the General Body of APOA in the meeting held on 21.06.2009, even if it is true, is contrary to its own constitution. Therefore, I find that the petitioners made out a prima facie case in their favour. The balance of convenience is also in favour of the petitioners since the very election of the respondents 1 and 2 is contrary to the constitution of APOA. If respondents 1 and 2 are allowed to discharge the functions of the President and Secretary, there is every likelihood of great injury being caused to the association, which cannot be rectified in terms of money. Therefore, the respondents 1 and 2 are to be restrained from discharging the functions as President and General Secretary of APOA.

34. The next question that falls for consideration is: Whether the circumstances of the case warrant appointment of a Receiver?

35. The constitution of APOA provides a mechanism for interim arrangements in the event of the posts of President and General Secretary falling vacant. Clause 16 of the Constitution of APOA reads as hereunder:-

16. FILLING UP OF VACANCIES OF EXECUTIVE COMMITTEE: i) President: In the case of death or resignation, an emergency meeting of Executive Committee is to be convened immediately thereafter by the General Secretary and the vacancy is to be filled by co-opting one of the Vice-Presidents as President. The Vice- President, so co-opted shall temporarily hold the office till the immediate next Annual General Body meeting. The President of the Association is to be elected, thereafter, in that General Body meeting with the subject figuring as an independent item in the Agenda. The President so elected will hold the office for the remaining period till the next elections are held for the Executive Committee. ii) Vice-President: In the case of death or resignation, the vacancy is to be filled by co-option in the immediate next Executive Committee meeting and such co-opted person shall hold the office till the next elections are held. iii) General Secretary: In case of death, the President shall immediately, nominate one of the Joint Secretaries to function as General Secretary. In case of resignation, the same is to be accepted after the charge is duly handed over satisfactorily, to one of the Joint Secretaries nominated by the President, who shall thereafter function as General Secretary. The General Secretary so appointed shall call for an Extra-ordinary General body Meeting within 90 days of his appointment by the President to elect the General Secretary. The General Secretary, so elected shall hold the office till the next elections are held. iv) Treasurer: In case of death, the President shall immediately nominate one of the Office Bearers other than the General Secretary, as Treasurer. In case of resignation, the same is to be accepted after the charge is duly handed over satisfactorily, to one of the Joint Secretaries nominated by the President, who shall thereafter function as Treasurer. The Treasurer so appointed shall hold the office, till the next Annual General Body meeting. The Treasurer of the Association is to be elected thereafter, in that General Body meeting, with the subject figuring as a specific item on the Agenda. v) Joint Secretary: In the case of death or resignation, the vacancy arising is to be filled by co-option in the immediate next executive committee meeting. The co-opted person shall hold the office till the next elections are held. vi) Executive Committee Member: In the case of death or resignation, vacancy arising is to be filled by co-option in the immediate next Executive Committee Meeting. The co-opted person shall hold the office till the next elections are held.

36. In Shavax Vs. Masood Hosain (7 supra), a Division Bench of this Court held that: “Under Section 44 of the Specific Relief Act, the appointment of a Receiver pending a suit is a matter resting in the discretion of the Court, the mode and effect of his appointment, rights, powers, duties and liabilities being regulated by the Code of Civil Procedure. The exercise of the power being discretionary, it would be difficult, even if it were possible, to define with any precision, the limits of that power. The exercise of that discretion in the ultimate analysis must be guided by the circumstances of each particular case. The opinion of the Court of first instance in these matters is of great weight. It is probably the best tribunal to decide whether it is necessary or expedient, having regard to the circumstances of the case, that a Receiver should be appointed, and a party, who, in appeal, attacks the exercise of this discretion, should show that the discretion has been improperly exercised.” There is no allegation against the executive committee as a whole that the members of the executive committee are mismanaging or misappropriating or tarnishing the image of the society. In the absence of such allegations, the appointment of a receiver to manage the affairs of the society is not warranted. Since a separate mechanism has been provided in the constitution of APOA for filling up casual vacancies; it is left open to the executive committee to make interim arrangements by nominating one of the Vice Presidents to discharge the functions of the President and one of the Joint Secretaries to discharge the functions of General Secretary pending disposal of O.P.No.1340 of 2009. Hence I find that the circumstances of the case do not warrant appointment of receiver to discharge the functions of President and General Secretary pending disposal of O.P.

38. In view of the above discussion, issues 3 and 4 are held in favour of the petitioners and whereas issue No.2 is held against the petitioners. Accordingly, C.R.P.Nos.4782 of 2009 and 5692 of 2009 are dismissed and whereas C.R.P.Nos.4783 and 4784 of 2009 are allowed. Consequently, I.A.Nos.2360 of 2009 and 2361 of 2009 stand allowed. There shall be no order as to costs.

39. Since the issue is with regard to validity of the election for the post of President and General Secretary of APOA, I deem it appropriate to direct the learned III Additional Chief Judge, City Civil Court, Hyderabad to dispose of O.P.No.1340 of 2009 as expeditiously as possible, preferably, within three months from the date of receipt of a copy of this order. _____________________ B.SESHASAYANA REDDY, J Sri K.G.K.Prasad, learned counsel appearing for the 1st respondent in C.R.P.Nos.4782 to 4784 of 2009 and petitioner in C.R.P.No.5692 of 2009 made a request to keep the order passed today in abeyance for a limited period, so as to enable the petitioner in C.R.P.No.5692 of 2009 to approach the Supreme Court and obtain necessary orders. In the given facts and circumstances of the case, I am of the view that this is not a fit case to grant suspension of the common order passed in these revision petitions. Accordingly, the request made by the learned counsel is rejected. _____________________ B.SESHASAYANA REDDY, J Dt.16–02-2010 Note:- Furnish order copy within two days (B/o) CS/RAR THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY C.R.P.Nos.4782, 4783. 4784 and 5692 of 2009 Date: 16th February, 2010 [1] AIR 2005 DELHI 226 [2] 2001 A I H C 1822 3 (1991)2 Supreme Court Cases 412 4 AIR 2001 GAUHATI 1 5 1982 (1) ALT 63 6 AIR 1962 Supreme Court 527 7 AIR 1965 ANDHRA PRADESH 143 8 AIR 1990 ALLAHABAD 188 9 AIR 1959 ALLAHABAD 598 10 AIR 1969 CALCUTTA 224 11 2009 (6) ALD 130 (SC) 12 1995-DL-1-142 13 2003(2) ALD 191 14 AIR 1981 SUPREME COURT 537 15 AIR 1997 GUJARAT 46 (Paragraph 6) 16 (2009) 6 Supreme Court Cases 316, Paragraphs 65, 66 and 67 17 AIR 1980 SUPREME COURT 1522 (paragraph 2) 18 AIR 1985 MADRAS 272 19 AIR 1978 CALCUTTA 307 (Paragraphs 14, 15 and 16) 20 AIR 1999 SUPREME COURT 3438 21 AIR 1996 SUPREME COURT 2384 22 (2007)3 Supreme Court Cases 686 23 (2006) 7 SCC 275 24 AIR 1982 DELHI 55