TMI Blog1931 (6) TMI 8X X X X Extracts X X X X X X X X Extracts X X X X ..... egistrar for an award under the Act and obtained one, which under the Act has the effect of a civil Court decree. Having discovered that the loan which had become the subject matter of the award, had been advanced through the Gajadharpur Society to two or three only or the thirteen members of that society the Central Bank applied to the Munsif for execution under the Civil Procedure Code against these members. 2. An objection was taken by the members which objection was overruled. There was an appeal to the learned District Judge of Gaya and he was of the opinion that as the village society was a body corporate, having become such under Section 18 of the Act, execution could not be levied against a member of that body corporate but only against the society itself and its assets. It is against that decision that there was an appeal to a Divisional Bench of this Court and the matter has now been referred to this Bench; the main reason for the reference being that in this province it has been the custom to execute decrees, not against the society itself, but against the individual members. There is no doubt in my mind that the view which was taken by the learned District Judge was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the law. 6. At Common law the Grown could create a body corporate under its prerogative but the Crown had no power to create a corporation and at the same time to render its members liable for its debts--Elve v. Boyton [1891] 1 Ch. 501, the judgment of Lindley, L.J. It necessitated a statute to effect this. An instance of that in England is 6 Geo. 4, Ch. 91 which enabled the Crown by Letters Patent to create corporations and to regulate the liability of members. That and some earlier Acts were repealed by an Act of 7 Wm. 4 and 1, Vict. Ch. 73. These Acts not only provided for the liability of all members of a body corporate but allowed under certain circumstances a judgment creditor to execute against an individual member. These Acts are mentioned purely for the purpose of showing that apart from statute neither was there any liability upon any individual members of the corporation nor was there any method by which judgments could be satisfied by execution against them. 7. An important piece of legislation on this point is the Act of 7 and 8, Vict. Ch. 110, Section 25, which indicates the view not only of lawyers and the Courts but the Legislature in the matter. After pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ord Lindley was referring to societies registered under the English Act of 1893 which differs in no material respect from the Act which we have to construe and contains Section 21 similar to Section 18 in this Act, which provides that on registration a society is rendered a body corporate. Indeed it must be obvious that the principles which apply to one body corporate must be those which apply to another, unless it is by statute provided otherwise. The objects for which a body corporate comes into existence or the rules or regulations under which the relations of the members inter se are governed can have no possible effect upon the legal conception which arises by the use of the expression body corporate. Now with these observations I propose to examine the Act and consider the arguments of the learned Government Pleader thereon. 11. Section 4 is the first important section upon which reliance is placed. This, as I have already stated was a society the liability of which is unlimited and it was stated in the course of the argument that before registering the society, not only were the rules submitted to the registrar to be examined under the provisions of Section 9 but the st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or may attempt to enforce his right is to be inferred. Rule 13 provides that the members are liable jointly and severally for the debts of the society. This rule, as in the case of the other rules is, one that regulates the relations between member inter se, and by applying for registration on the basis of these rules, and tinder this one in particular, the member agreed to make himself liable for all the debts of the society. Being a society of unlimited liability the liability of the member would be good for all the debts of the society whether there were this rule or not, unless indeed it can be said that the rule if properly construed means that one member may be liable for the whole of the debts of a society and cannot demand that the debts be proportioned amongst all the members. But it is impossible to say that this rule entitles a creditor to sue for execution against an individual member. It is true that the rules become part of the Act, but if indeed the rule either enlarges or modifies the Act (which it cannot be held to have been done in this case) it would be ultra vires. And indeed Section 9 provides that if the registrar is satisfied that a society has complied with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Section 42 at the instance of a creditor under Section 36 if indeed the creditor is entitled in law to proceed direct against any member of the society he likes to choose to recover the debts of the society. 16. The next section we come to is Section 44 which seems to me to be a complete answer to the whole argument which has been addressed to us. Section 44 allows the Government in cases where there are sums due to it from a registered society or from an officer or member or past member to recover such sums firstly from the property of the society, secondly in the case of a society of which the liability of the member is limited from the members subject to the limit of their liability, and thirdly in the case of other societies from the members. It is admitted that this is an exception in favour of the Government. If indeed it is an exception in favour of the Crown then the rule to which it is an exception must be contrary to the exception the rule being that a creditor cannot recover from the member of the society. 17. Some argument was advanced that under the rules it is indicated that such an execution can be levied and that the section itself does not preclude executi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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