JUDGMENT
Mhase S.B., J.
1. Heard. Rule returnable forthwith.
2. The order passed in Appeal from Order No. 926 of 2006 decided by the Maharashtra Co-operative Appellate Court (Mumbai) Bench, Pune at Pune (in short “Cooperative Appellate Court”) is under challenge. So also the order dated 16th August 2007 passed in Review Application No. 3 of 2007 is under challenge.
3. The dispute bearing C.C. No. 238 of 2003 was filed by the respondent – society against the petitioner for recovery of the amount of loan which was advanced to the petitioner. The said dispute was decided ex parte on 4th March 2004. Thereafter the petitioners have filed application for setting aside the ex parte award passed in the said dispute.
4. There was delay in filing the said application, therefore a delay condonation application was also filed. The Co-operative Court allowed the Miscellaneous Application No. 126 of 2004 and condoned the delay subject to payment of Rs. 750/-. Accordingly a cost of Rs. 750/- was paid. Thereafter the restoration application was decided by the Co-operative Court which was also bearing Miscellaneous Application No. 126 of 2004 and the ex parte decree was set aside and the suit was directed to be proceeded with. The order passed by the Co-operative Court setting aside the ex parte decree was challenged by the respondent – society before the Co-operative Appellate Court being Appeal from Order No. 926 of 2006. That appeal was partly allowed and the petitioner was directed to deposit the amount of Rs. 70,000/- by three monthly instalments of Rs. 20,000/- and last instalment of Rs. 10,000/ -. It was further directed that the first instalment of Rs. 20,000/- shall be paid on or before 1st February 2007, the second instalment of Rs. 20,000/- shall become due on 1st of March 2007 and the third instalment of Rs. 20,000/- shall become due on 1st of April, 2007. The last instalment of Rs. 10,000/- shall become due on 1st May 2007. It is further provided in the order that failure to deposit any instalment will automatically lead for setting aside the impugned order under challenge and the appellant shall be at liberty to proceed ahead with the pending Darkhast for recovery of the decretal amount by following the due process of law.
5. It appears from the judgment of the “Co-operative Appellate Court that the Co-operative Appellate Court proceeded to deal with the matter under assumption that the Co-operative Court set aside the order without condonation of delay. However, that was an error. In fact the Co-operative Court initially condoned the delay and cost of Rs. 750/-, as imposed, was paid. Therefore the Cooperative Court was justified in proceeding further to set aside the award so that the dispute can be heard on merit. However, this aspect has been ignored by the Co-operative Appellate Court and Co-operative Appellate Court, instead, directly proceeded to pass the award for instalments of the loan amounts as stated earlier. This was a mistake. In order to point out this mistake to the notice of the Co-operative Appellate Court, Review Petition bearing No. 3 of 2007 was filed by the petitioner. However, unfortunately the same has also been rejected by the Co-operative Appellate Court.
6. Whenever the ex parte award is passed and the defendant or the opponent approaches the Court for setting aside the said award, the award can be set aside by the Cooperative Court in order to give opportunity to the Opponent in the said proceeding to contest the claim. If there is delay in making the application for setting aside the award, such delay condonation application can b£ considered by the Co-operative Court.
7. In the present matter the delay condonation application and the application for setting aside the award both were preferred, and stage by stage the Co-operative Court has decided it and ultimately has allowed them. When the matter reached the Co-operative Appellate Court, the Appellate Court should have looked into these aspects. However, this Court finds that the Co-operative Appellate Court ignoring the record and proceedings has unfortunately concluded that the restoration application has been disposed of by the Co-operative Court without condoning the delay. Assuming for a moment that the same mistake was committed by the Appellate Court, in that circumstances the Appellate Court should have set aside the order of setting aside award and further given direction to the Co-operative Court to consider the application for condonation of delay on its own merit and thereafter to proceed for deciding the application for setting aside the award. The Appellate Court unfortunately ignored this aspect of the matter also, and directly entered into the merit of the matter assuming and usurping the jurisdiction of the Co-operative Court strait-away proceeded to pass the award for instalments of the main loan amount.
8. This procedure which the Appellate Court has followed is absolutely illegal, contrary to the principles of law and procedure established. Above all when these facts were brought to the notice of the Appellate Court by filing a review application, unfortunately, the Appellate Court did not take cognizance of these facts and giving flimsy reasons rejected the review application. No doubt the loan amounts are required to be recovered and the societies may find it difficult to recover the amount, however, that does not mean that the Appellate Court shall usurp the original jurisdiction of the Co-operative Courts under the pretext and in the manner in which it has been done in the present matter so as to pass the order in favour of the society.
9. Less said the better, this Court only directs That henceforth the Appellate Court will take a serious view of the matter and will find out and will properly scrutinise the record and will follow the proper procedures. The order passed by the Appellate Court in Appeal No. 926 of 2006 and Review Application No. 3 of 2007 are bad and illegal. Therefore, these orders are hereby set aside. The order passed by the Co-operative Court restoring the dispute bearing C.C. No. 238 of 2003 is hereby confirmed. The Co-operative Court is hereby further directed to proceed with the matter in accordance with law after giving an opportunity to both sides. If the defendant petitioner has not yet filed any written statement in the main dispute, within a period of three weeks the defendant shall file the written statement and after filing of the written statement the Co-operative Court shall fix the issues and points for determination and thereafter allow both parties to lead evidence in respect of the disputed issues and shall decide the matter on its own merits within a period of six months from the date of receipt of the order from this Court. Rule made absolute accordingly.