This writ petition is directed against the order dated 9-12-1987 assed by the Secretary Co- operatives, respondent No.1.
2. Brief facts of the case are that Muhammad Ramzan, respondent No.2 was the President of the Co-operative Credit and Thrift Society, Kothewala. He obtained a loan of Rs.35,000.30 from the Punjab Co-operative Bank Ltd., on 17-5-1978 in the, name of the Society. Prior to that Hafiz Khuda Bakhsh, father of the petitioner and respondent No.2, wanted to get a loan amount of Rs.49,067 from respondent No.3 and mortgaged his land in favour of the Agricultural Development Bank, Multan in August, 1974 in respect of which mutation No.231 was sanctioned on 29-5-1975. However, the loan amount was never disbursed to Hafiz Khuda Bakhsh till his death which took place on 7-8- 1979.
3. After the death of the petitioner's father mutation of his inheritance being No.596 was sanctioned on 15-12-1981 in favour of the petitioner, Muhammad Ramzan, respondent No.2, Mst. Rahim Khatoon, respondent No.6, Mst. Ata Illahee, Mst. Raj Illahee, and Mst. Taj Illahee. Mortgage of land in favour of the Agricultural Development Bank terminated on 26-8-1982 in respect of which mutation No.682 was sanctioned on 27-11-1982. Muhammad Ramzan respondent No.2 mortgaged his share of the land in favour of the UBL Gulzar Pur in lieu of Rs.44,000 as is borne out by mutation No.745, sanctioned on 23-7--1983.
4. Subsequently it came to the notice of the officials of the Co-operative Department that Muhammad Ramzan, respondent No.2 had misappropriated the amount of Rs.35,000, which he had borrowed from the Punjab Co-operative Bank in the name of Co-operative Credit and Thrift Society. The dispute was referred to arbitration under section 54 of the Co-operative Societies Act, 1925. The Assistant Registrar, Co-operative Societies, Multan, appointed Ghulam Yasin as the arbitrator who gave an award against Muhammad Ramzan on 13-6-1984. Muhammad Ramzan was held to be liable to pay total amount of Rs.62,073.31. On the basis of award, the Assistant Registrar ordered recovery of the amount vide his order dated 13-6-1984. Muhammad Ramzan challenged the award before the Secretary, Co-operative, (Punjab Government), Lahore. He urged before respondent No.1 that the Department could satisfy the award by sale of the agricultural land measuring 94 kanals 8 marlas mortgaged with the Society by his father on 27-1-1975. This was accepted by respondent No.1, who disposed of the appeal vide his order dated 9-12-1987 with the observation that 94 kanals and 8 marlas of land mortgaged with the Society through registered deed dated 27-1--1975 could be disposed of for the satisfaction of the decretal amount.
5. In the appeal/review before the Secretary, Co-operative (respondent No.1), petitioner or his sisters were not impleaded as respondents. The petitioner had, in fact, purchased the share from his three sisters through a registered sale deed 17-4-1985 which was incorporated in mutation No.145 sanctioned on 18-4--1985. The petitioner filed a review petition against the order dated 9- 12-1987 which was dismissed by respondent No.1 vide his order dated 14-4-1988, holding it to be incompetent. Hence this petition.
6. The learned counsel for the petitioner contended that the petitioner was condemned unheard before respondent No.1. His review petition was held to be incompetent and he was not heard on merits. He further contended that no appeal was competent against the award given by the arbitrator under section 54 of the Co-operative Societies Act. Similarly revisional powers under section 64-A of the Act could not be exercised as the. Same covered administrative or departmental inquiries or proceedings and not arbitration proceedings. In this connection he placed reliance on Sh. Haider v. Registrar Co-operative Societies and others PLD 1966 Kar.177. He argued that the mortgage executed by the late father of the petitioner was terminated on 26-8- 1982. Moreover, the deceased father of the petitioner had not obtained loan from the Agricultural Development Bank. It was held by the arbitrator that the Co-operative Society Respondent No.3 did not advance any loan to Khuda Bakhsh deceased. He explained that the deceased owned 378 Kanals and 10 Marlas of land. The land mortgaged to the Agricultural Development Bank, Multan, was redeemed on 17-11-1982 through mutation of redemption No.682. There being no mortgage in favour of the Society there was no question of sale of a land belonging to the petitioner for recovery of the loan advanced to Muhammad Ramzan, respondent No.2. On the other hand learned counsel for respondent No.2 urged that the petitioner had submitted to the jurisdiction of the Secretary by riling a review petition before him. He pointed out that in the writ petition the jurisdiction of the respondent No.1 was challenged. He further submitted that the petitioner was heard in the review application. Therefore, his grievance that he was not heard in the appeal, no longer held any ground. Lastly he submitted that notwithstanding the mortgage in favour of Agricultural Development Bank of Pakistan, land could be mortgaged to the Society. In this connection he referred to Iqrarnama dated 27-1--1975 executed by Khuda Bakhsh in favour of the Society.
7. I have given my anxious consideration to the contentions raised by the learned counsel for the parties. Admittedly Khuda Bakhsh deceased father of the petitioner, and respondent No.2 had mortgaged his land on 20-8-1974 to the Agricultural Development Bank, Multan. In the second mortgage which is said to have been executed on 27-1-1975, there is no reference to the earlier mortgage. Instead, it mentions that the land was free from all encumbrances like sale, mortgage etc. The alleged mortgage deed dated 27-1-1975 is challenged by the petitioner as being a forged document. It was pointed out that Khuda Bakhsh deceased had never obtained any loan from the Society. Had he done so some proceedings for the recovery of the loan would have been taken against him. However, no proceedings were taken against the deceased either before or after his death. Be that as it may, the fact remains that the petitioner was condemned unheard before respondent No.1. The petitioner is one of the heirs of Khuda Bakhsh deceased and had even purchased the share of his three sisters through a registered sale deed. The order dated 9-12-1987 passed by respondent No.1 definitely affects the rights and interest of the petitioner. He was entitled to a hearing before respondent No.1. The order passed in his absence is violative of the principle, "audi alteram partem" and, hence a nullity in the eye of law. There is also considerable force m the argument of the learned counsel for the petitioner that no revision against the award dated 13-6- 1984 was competent. The award was given by the arbitrator under section 54 of the Co-operative Societies Act and the aggrieved party could have preferred an appeal under section 56 of the Act to the Registrar. However, no appeal was fled and the award attained finality. Subsequently, the Assistant Registrar merely ordered recovery of the amount on 13-6-1984 on the basis of the award, which had attained finality. Even a revision petition was not competent against the said order. The powers under section 64-A of the Co-operative Societies Act extend to administrative or departmental inquiries or proceeding and not the arbitration proceedings as held in Sheikh Haider v. Registrar and others PLD 1966 Kar.177. The arbitrator definitely was not an officer subordinate to the Provincial Government or the Registrar. Hence, the Government or for that matter the Registrar have no jurisdiction under section 64-A to modify, annul or reverse the award given by the arbitrator or the Registrar's nominee under section 54 of the Act. Looked at from this angle, the impugned order is clearly without jurisdiction. The petitioner has mentioned in para 2 of the writ petition that the order of respondent No.1 was illegal, without lawful authority and of no legal effect and the prayer was also to the same strain. He can advance reasons in support of his main contention particularly when the same are purely legal. The mere fact that the petitioner attempted to have the order recalled and filed a review application before respondent No.1 was not sufficient to debar him for challenging the order on the ground that the same was without jurisdiction. The petitioner is, therefore, within his rights to substantiate his challenge to the impugned order as being without lawful authority and of no legal effect on the additional reason that the said order was beyond the purview of Section 64-A of the Co-operative Societies Act, 1925.
8. For the foregoing reasons, this writ petition is allowed and the order dated 9-12-1987 is declared to be without jurisdiction, without lawful authority and of no legal effect. However, the Society is at liberty to take any step permissible under the law for the recovery of the loan against Muhammad Ramzan. In this process if the interest/rights of the petitioner or his sisters are in any manner involved, they must be given an opportunity of being heard before passing any order adverse to them. The parties are left to bear their own costs.