Patnaik, J.
1. The petitioner in O.P. No. 8055 of 1990-H has preferred this writ appeal against the judgment dated 12-10-1990 by which the awards under Exts. P-11 and P-12 by the Assistant Registrar of Co-operative Societies (General), Cannnore and the Kerala Co-operative Tribunal, Trivandrum were upheld and the petitioner/appellant and the second respondent have been directed to pay a sum of Rs. 91,048/- with 18% interest per annum with effect from 18-11-1982 until realisation to the Cannanore District Wholesale Co-operative Consumer Stores Ltd., (for short, the Consumer Stores).
2. The Consumer Stores was established to do the business of distributing consumer items to the public. It placed an order for the supply of a vehicle with the second respondent herein (M/s. C. C. Automobiles Ltd., Calicut) which was necessary for transporting the consumer items. The first respondent (the Consumer Stores) placed its order for a mini lorry with the second respondent and paid an advance of Rs. 3,000/- and afterwards remitted Rs. 88,048/- by cheque on 18-11-1982. The second respondent, thereafter, informed the first respondent that they would transfer the amount to the principal dealer of the vehicles, namely, petitioner/appellant for supply of the van, by their letter dated 23-11-1982. But, in spite of the payment in full the petitioner/appellant failed to supply the Van to the first respondent. The first respondent being a Co-operative institution filed a petition before the Assistant Registrar of Cooperative Societies (General), Cannanore -- 3rd respondent--under Section 69 of the Kerala Cooperative Societies Act, 1969 (for short, the Act) making a claim for the aforesaid amount with interest from the second respondent. During the course of hearing, the petitioner/appellant was impleaded as a party on the allegation of the second respondent that the amount was due from the petitioner/appellant.
3. The third respondent -- Assistant Registrar of Co-operative Societies (General), Cannanore -- allowed the petition and held that the petitioner/appellant and the second respondent are jointly and severally liable to pay the amount. The petitioner/appellant filed an appeal before the 4th respondent--The Kerala Co-operative Tribunal, Trivandrum -- challenging the above decision as well as the jurisdiction of the third respondent to decide the dispute under Section 69 of the Act. The Tribunal confirmed the award of the 3rd respondent and further held that the third respondent had the jurisdiction to decide this dispute. With the above observation, the appeal was dismissed by Ext. P-12 judgment.
4. The learned single Judge, by the impugned judgment, by relying on the decision in Meeran Unni v. Kottayam Dist. Co-operative Bank, 1985 Ker LT 384: (AIR 1985 Ker 189) (FB), held that the third respondent lacked jurisdiction to decide this dispute inasmuch as it is not one which falls within the purview of Section 69(1)(f) of the Act. Nevertheless the learned single Judge observed that there is concurrent findings on facts. The concurrent findings would show that the petitioner/appellant is also liable to pay the amount to the first respondent -- Consumer Stores. The learned single Judge did not find any failure of justice in the findings of the two Courts below though he said that on a closer analysis of Section 69(1)(f) of the Act the dispute does not strictly fall within its purview. It was also observed by the learned single Judge, by relying on the decision in Iyyappan Mills Ltd. v. Iyyappan Mills Workers Union, 1961 Ker LT 589: (AIR 1962 Ker 11), that the High Court must not exercise jurisdiction under Article 226 of the Constitution for the mere absence of jurisdiction of a Court or Tribunal unless there is substantial injustice or substantial miscarriage or failure of justice.
5. The learned counsel for the appellant contended that the impugned award passed under Section 69 of the Act being a nullity and is prejudicial to the appellant, it cannot be said that no substantial injustice was done. It is further contended that the impugned award makes the appellant liable to pay a huge amount under a void decree. This cannot be said to be one which has not resulted in grave injustice to the appellant.
6. Learned counsel or the first respondent contended by relying on the decision in lyyappan Mills Ltd. case, 1961 Ker LT 589:(AIR 1962 Ker 11) that the same result would have followed if a civil suit had been instituted for recovery of the amount from the petitioner/appellant as well as the second respondent and as such no substantial injustice has resulted from the award, even though the award is held to be one passed without jurisdiction. Though the learned counsel for the first respondent made an attempt to prove that the 4th and 5th respondents had jurisdiction to decide such a dispute, yet we find that the finding arrived at by the learned single Judge that they lacked jurisdiction to decide the dispute is unassailable: The finding was based upon the dictum laid down by a Full Bench of this Court in Meeran Unni's case, 1985 Ker LT 384 : (AIR 1985-Ker 189).
7. We, therefore, find that the 4th respondent and the 5lh respondent had no jurisdiction to decide the dispute under Section 69 of the Act and as such the award is a nullity. Consequently, the finding of the Tribunal (5th respondent) which is contrary to law js patently erroneous.
8. The main question that arises for consideration in this appeal is whether, in spite of the fact that the award is anullity for having been passedwithout jurisdiction under the law, issue of a writ of certiorari quashing the impugned award can be refused on the ground that no substantial injustice or prejudice has been caused to the petitioner/ appellant.
9. The Supreme Court in State of U. P. v. Mohammad Nooh, AIR 1958 SC 86 laid down as follows (para 11):
'On the authorities referred to above it appears to us that there may conceivably be cases -- and the instant case is in point -- where the error, irregularity or illegality touching jurisdiction or procedure committed by an inferior Court or tribunal of first instance is so patent and loudly obstrusive that it leaves on its decision an indelible stamp of infirmity or vice which cannot be obliterated or cured on appeal or revision. If an inferior Court or tribunal of first instance acts wholly without jurisdiction or patently in excess of jurisdiction or manifestly conducts the proceedings before it in a manner which is contrary to the rules of natural justice and all accepted rules of procedure and which offends the superior Court's sense of fair play the superior Court may, we think, quite properly exercise its power to issue the prerogative writ of certiorari to correct the error of the Court or tribunal of first instance, even if an appeal to another inferior Court or tribunal was available and recourse was not had to it or if recourse was had to it, it confirmed what ex facie was a nullity for reasons aforementioned. This would be so all the more if the tribunals holding the original trial and the tribunals hearing the appeal or revision were merely departmental tribunals composed of persons belonging to the departmental heirarchy without adequate legal training and background and whose glaring lapses occasionally come to our notice. The superior Court wilt ordinarily decline to interfere by issuing certiorari and all we say is that in a proper case of the kind mentioned above it has the power to do so and may and should exercise it. We say no more than that.'
In the book 'Russell on the Law of Arbitration (20th Edn.) at page 267, the author observed as follows :
'In cases where an arbitrator enters into the consideratidn of matters which are not referred to him, or which he has no jurisdiction to try, 'the question is not one of waiver or estoppel, but of authority' and a party continuing to attend the reference after objection taken and protest made does not give the arbitrator authority to make an award.
Where an arbitrator who had allowed the time to expire for making his award proceeded with the reference notwithstanding an objection taken and protest made on that ground by a party to the reference, it was held that party, by continuing to attend and contest the case before the arbitrator, did not give the arbitrator authority to make an award. Ringland v. Lowndes, (1864) 33 LJCP 337.
If a party to a reference objects that the arbitrators are entering upon the consideration of a matter not referred to them and protests against it, and the arbitrators nevertheless go into the question and receive evidence on it, and the party, still under protest, continues to attend before the arbitrators and cross-examines the witnesses on the point objected to, he does not thereby waive his objection, nor is he estopped from saying that the arbitrators have exceeded their authority by awarding on the matter.
Continuing to take part in the proceedings after protests made does not amount to a consent.
It should in this connection be remembered that it is proper for an arbitrator to make such inquiries as are necessary to enable him to decide whether he has or has not jurisdiction over a matter which one or other party asks him to consider.
The rule that an appearance before an arbitrator solely to protest against his jurisdiction is not a submission to his jurisdiction, and that indeed a party may safely do more than merely protest against an arbitrator purporting to exercise jurisdiction without thereby submitting to his jurisdiction, may be contracted with the -- much criticised -- rules applicable to so-called voluntary submissions to the jurisdiction of a Court. Before a Court, even appearance in order solely to protest jurisdiction may, if unsuccessful, be deemed to be a voluntary submission to jurisdiction. The reason advanced for this difference of approach, namely that an arbitrator's jurisdiction is always wholly consensual, whereas a Court has compulsory jurisdiction is somewhat unconvincing. It is difficult to see how the nature of the jurisdiction can affect the voluntariness of the submission; indeed if it had any effect it would appear to be the converse to that advanced, for the more compulsory the jurisdiction the less the affected party is a volunteer. Or, if the reasoning be that the affected party cannot refuse to volunteer when a Court has compulsory jurisdiction, why pretend that his volunteering or not is relevant.'
Similarly, Thomas M. Cooley in his book 'A Treatise on the Constitutional Limitations' (1972 Edition), at pages 397 to 399, has said :
'The proceedings in any Court are void if it wants jurisdiction of the case in which it has assumed to act. Jurisdiction is, first, of the subject-matter; and, second, of the persons whose rights are to be passed upon.
A Court has jurisdiction of any subject-matter, if, by the law of its organization, it has authority to take cognizance of, try, and determine cases of that description. If it assumes to acting case over which the law does not give it authority, the proceeding and judgment will be altogether void, and rights of property cannot be divested by means of it.
And on this point there is an important maxim of the law, that consent will not confer jurisdiction, by which is meant that the consent of parties cannot empower a Court to act upon subjects which are not submitted to its judgment by the law. The law creates Courts, and with reference to considerations of general public policy defines and limits their jurisdiction; and this can neither be enlarged nor restricted by the act of the parties.
Accordingly, where a Court by law has no jurisdiction of the subject-matter of a controversy, a party whose rights are sought to be affected by it is at liberty to repudiate its proceedings and refuse to be bound by them, notwithstanding he may once have consented to its action, either by voluntarily commencing the proceeding as plaintiff, or as defendant by appearing and pleading to the merits, or by any other formal or informal action. This right he may avail himself of at any stage of the case; and the maxim that requires one to move promptly who would take advantage of an irregularity does not apply here, since this is not mere irregular action, but a total want of power to act at all. Consent is sometimes implied from failure to object; but there can be no waiver of rights by laches in a case where consent would be altogether nugatory.'
10. The case at hand is one relating to claim of refund of money arising out of a contract between the first respondent and the petitioner/appellant. Clause (f) of Section 69 of the Act contemplates that it is only in the case where the Society has or had business transaction with any person or any person claiming through such a person that a dispute can be decided by a Co-operative Arbitration Court. Here, admittedly the vehicle was intended to carry on the business of the Society. That is the solitary incidental act of commercial transaction that was entered into between them and it cannot be said that the Society has or had business transactions with the petitioner/appellant. As has been rightly decided by the Full Bench of this Court that an incidental transaction would not give rise between a Co-operative Society and any other person would not amount to a dispute coming within the purview of Section 69 of the Act. This dispute essentially is one which could be decided only by a competent Civil Court in a properly constituted civil suit. The award under question was passed summarily by the 4th and 5th respondents. It may be true that both parties have led evidence. But, a suit of which cognizance could be taken by the Civil Court, if decided by an Arbitrator under the Co-operative Societies Act, who has no jurisdiction, it cannot be said that no prejudice was caused to the petitioner/appellant. The contention that the Civil Court would have come to the same conclusion, had a suit been filed, is based on a speculation or hypothetical expectation.
11. Learned counsel for the respondent referred to the decision of this Court in Iyyappan Mills Ltd. case, 1961 Ker LT 589: (AIR 1962 Ker 11) and the decisions of the Supreme Court in Sangram Singh v. Election Tribunal, Kotah, AIR 1955 SC 425; A. M. Allison v. B. L. Sen, AIR 1957 SC 227 : 1957 SCR 359; Balvantrai v. M. N. Nagrashna, AIR 1960 SC 407; B. C. Trivedi v. M. N. Nagrashna, AIR 1960 SC 1292 and Babu Raj v. State of Kerala, (1994) 2 Ker LT 679 (FB), in support of his contention that if no substantial injustice has been done in the case the Court in exercise of its extraordinary jurisdiction under Article 226 of the Constitution shall not intefere with the Award.
12. In Sangram Singh's case, AIR 1955 SC 425, it is clearly laid down that certiorari will be issued when the Court or Tribunal acts illegally inthe exercise of its undoubted jurisdiction's when it decides without giving an opportunity to the parties to be heard, or violates the principles of natural justice. It implies that unless a judgment or order of an inferior tribunal is not perverse or otherwise illegal, no writ of certiorari would lie. What is emphasised in this dictum is that the Tribunal whose order is challenged should have undoubted jurisdiction to decide the matter. In this case, it has been held by the learned single Judge, with whom we concur, that the Arbitrator and the Tribunal acted without jurisdiction.
In Allison's case, 1957 SCR 359 : (AIR 1957 SC 227), the Supreme Court laid down that a writ of certiorari cannot be had as a matter of course. But, the facts of this case are clearly distinguishable. It was a case under Section 20 of the Minimum Wages Act, 1948. The State Government fixed the minimum basic wages for tea-estate labourers. There was no dispute that the management in fact paid the minimum wages as fixed by the Government. But, what the labourers claimed is that they have not been paid the extra wages for plucking green tea leaves in excess of the basic work-load or task. It was found that such a claim for extra wages certainly does not amount to a claim arising out of the payment of less than the minimum rates of wages. It was contended that the Commissioner who decided the case in favour of the labourers had no jurisdiction inasmuch as it was not a case of a complaint of payment of less wages than what is fixed. In that context, the Supreme Court held as follows (Para 16 of AIR):
'We do not propose to decide this question of jurisdiction as in the instant cases we have, in addition to the determination of the Deputy Commissioner, Sibsagar, the adjudication of the main disputes between the parties by the High Court itself. Whatever infirmities might possibly have attached to the orders passed by the Deputy Commissioner, Sibsagar, on the score of want of jurisdiction, we feel that having regard to the circumstance that the matters have been pending since September, 1952, right up to the end of the year 1956, no useful purpose will be served by our interfering at this stage, as the Deputy Commissioner, Sibsagar, and the High Court both came to the same conclusion.'
Thus, it can be seen that in Allison's case the Supreme Court did not decide the question of jurisdiction of the Deputy Commissioner in deciding the dispute. Further, there was a concurrent finding of fact by both the Commissioner and the High Court. The matter was not brought before the Supreme Court on appeal for which a concurrent finding of fact was not interfered and finally it was found that the High Court being satisfied that there was no failure of justice, the award of the Commissioner could not set aside on the ground that the Commissioner had no jurisdiction to pass such an award.
But, in the present case, we hold that substantial injustice has been caused to the petitioner/ appellant on a consideration of the judgment under appeal. In that case, there was no alternative forum to agitate the matter. But, in this case, the appropriate legal forum to adjudicate the dispute was the Civil Court and not the arbitrator under Section 69 of the Act. The decree of the arbitration Court being void cannot be executed according to law.
The facts in Balvantrai's case, AIR 1960 SC 407 were as follows :
''Certain employees of the appellant mill made an application to the Authority under the Payment of Wages Act claiming that they were entitled to be paid according to a particular scale. The Authority held that the folders were entitled to the scale, rejecting the objection of the appellant to its jurisdiction to entertain such application. The appellant then filed a writ petition but that was summarily dismissed by the High Court. The appellant thereafter appealed to the Supreme Court by special leave and contended that the Authority had no jurisdiction to entertain the application and also disputed its decision on merits.'
On a consideration, the Supreme Court held as follows (Para 4 of AIR):
'We have heard the learned counsel for the parties at length, and there appears to be some force in the contention of the appellant so far as the jurisdiction of the Authority is concerned; but we do not propose to decide this question of jurisdiction in the instant case because we have in addition to the determination of the Authority the fact that the appellant went to the High Court by a writ petition against the decision of the Authority and its petition was dismissed by the High Court. The present appeal is not directly from the judgment of the Authority but is from the order ofthe High Court dismissing the writ petition. Whatever infirmities might have attached to the order of the Authority, there would in our opinion be no reason to interfere with the order of the High Court dismissing the writ petition, if we come to the conclusion that the order passed by the Authority in this case has not resulted in any failure of justice.'
In this case also the Supreme Court declined to give any finding as to whether the order under challenge was passed by an authority having jurisdiction or not. Since the issue of jurisdiction was not clearly found against the workmen who filed the case under the Payment of Wages Act, the Court rendered the above finding. The facts are also clearly distinguishable between the present case and the above case. In the above said case, a review petition was also filed and in AIR 1960 SC 1292 it is laid down as follows :
'It is not unknown to law that decisions of original Courts and tribunals may be allowed to stand even though there may be some doubt as to the jurisdiction of such Courts or tribunals. There are provisions in the revenue laws where in case of doubt whether the Civil Court or the Revenue Court has jurisdiction the decision of the original Court is allowed to stand in certain circumstances if there has been no failure of justice.
Therefore, when in an appeal by special leave under Article 136, the judgment of the Supreme Court leaves the question of the jurisdiction of the lower tribunal open on the ground that there was no failure of justice and, in consequence, the Court refused to exercise its jurisdiction under Article 136, it cannot be said that something was done which was unknown to law.'
Thus, the question of jurisdiction of the lower tribunal to decide the dispute was left open, meaning thereby that the question of want of jurisdiction of the tribunal whose order was under challenge was. not decided at all.
In Iyyappan Mills Ltd., 1961 Ker LT 589 : (AIR 1962 Ker 11), a broad proposition has been laid down that the lack of jurisdiction of the subordinate tribunal by itself is not substantial or manifest injustice. It was a case under the Industrial Disputes Act. The Management decided to close the factory and in the course of conciliation in the matter of payment of retrenchment benefits to the workmen, the management had agreed to offer such compensation. On the basis of that concession, the tribunal awarded retrenchment compensation to the workmen, in spite of the fact that the Tribunal has no jurisdiction to give such a finding. In this context, it has been laid down as follows (Para 8 of AIR):
'The foregoing extracts from several judgments of the Supreme Court leave no room to doubt that the powers of the High Court under Article 226 of the Constitution are very wide and discretionary and the High Court may not exercise them unless there is substantial injustice or substantial miscarriage or failure of justice. The mere absence of jurisdiction of a subordinate Court or tribunal or the mere presence of errors apparent on the face of the record without any resultant manifest injustice is not sufficient to call for the exercise of the discretionary powers of the High Court under Article 226 of the Constitution. The lack of jurisdiction of the subordinate tribunal, by itself, is not substantial or manifest injustice. In the case before us the Tribunal acted in excess of jurisdiction in recording a finding that the closure, though bona fide and justifiable, amounted to retrenchment and therefore workers were entitled to retrenchment compensation. Strictly speaking, that portion of the finding of the Tribunal in the award is beyond or without jurisdiction. Even so, what the Tribunal has granted as retrenchment compensation are only the amounts offered by the management in its notice at the time of the closure. It may also be noted that 16 out of 51 workers have already been paid compensation at this rate. Therefore, in our opinion, no manifest injustice or substantial miscarriage or failure of justice has resulted by the said finding or direction of the Tribunal, though the order is in excess of jurisdiction.'
Thus, on facts no substantial injustice is foundto have been caused to the management by passing an order by the Tribunal which has no jurisdiction to do so.The facts in Babu Raj's case, (1994) 2 Ker LT679 (FB) are clearly distinguishable from thepresent case. That was a case relating to Rule31 (e) of the State and Subordinate Services Rules,1958 (Kerala). In that case, it has been laid downas follows:
'The extraordinary jurisdiction conferred under Article 226 of the Constitution, is neitherappellate nor revisional, but to advance substantial justice to the parties when there is infraction of any statutory provision or rule. Even if a legal lacuna is traced out in the orders impugned, the discretionary power need not be exercised unless such lacuna has resulted in substantial injustice to the party concerned.'
In the case at hand, the lacuna in the award is not a formal one. But, it being one of without jurisdiction, it affects the root of the matter. The Tribunal, who has no inherent jurisdiction, imposed a heavy liability and the decree thereunder if executed would result in substantial or manifest injustice.
13. For the reasons stated above, we find that the judgment under appeal cannot be sustained. However, we make it clear that the first respondent is at liberty to move the Civil Court, if so advised, for an adjudication of the claim against the petitioner/appellant.
14. The writ appeal is allowed. The judgment in the O.P. is set aside. Exts.P-11 and P-12 in O.P. No. 8055 of 1990 are quashed. No costs.