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TMI Blog2019 (6) TMI 1725X X X X Extracts X X X X X X X X Extracts X X X X ..... of contract from creating a lease of its property in favour of any villager. A person who deals with a society or corporate body must no doubt familiarize himself with the constitution of the society or corporate body (in case of a company, it would be its Memorandum and Articles of Association), but once it is found that there is no restriction on the authority of the person to execute the act in such constitution, there is no further duty on the person to enquire into the internal management of the society or the corporate body and assess whether or not due procedure has been followed for executing the act in accordance with the rules of management applicable to the society or corporate body, as the case may be. There is one more reason why the onus was on the plaintiff in the present case. Under Section 106 of the Evidence Act, the burden of proving any fact which is especially within the knowledge of any person is upon that person. Its own internal statute was a matter which was clearly within the special knowledge of the plaintiff. The impugned order of the learned Ad-hoc District Judge is accordingly set aside and the suit of the plaintiff is dismissed. - Hon'ble Judges ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and had caused irreparable loss to the plaintiff and was an abuse of authority by the President. The learned Judge, accordingly, held that the plaintiff had proved its case of nullity and invalidity of the subject Lease Deed. The other issues framed in the suit merely followed the decision of the Court on issue No. 1, since they concerned the reliefs to be granted to the plaintiff-society based on the decision on that issue. 5. Learned Counsel for the appellants (defendants) submits that the act of the plaintiff-society in creating a lease in favour of the defendants cannot be termed as an ultra vires act. Learned Counsel submits that it has come in evidence that the plaintiff society had created a number of such leases in favour of residents of the village. Learned Counsel submits that so far as the authority of the President is concerned, the bye-laws or charter of the society authorised him to represent the society both within and outside the Court in all matters save and except those which involved important steps and which were prescribed in the internal statue of the society. Learned Counsel submits that the doctrine of indoor management requires that onus to prove want of au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whether in Court or outside and whether actively or passively. The only restriction against such Manager or President is that he shall not take any initiative on important subjects prescribed in the internal statute of the society without the resolution of the Administrative Body. There is indeed nothing in the charter or otherwise to show that the society is forbidden by law or as a matter of contract from creating a lease of its property in favour of any villager. In fact, if anything, the evidence on record suggests that there were a number of other leases created by the society in favour of villagers of properties owned by it. Once it is held that the act of the society in creating the lease in favour of the defendants is not ultra vires, the question of authority of any particular office bearer of the society to act on its behalf in that respect, is really a matter of its internal management. A person who deals with a society or corporate body must no doubt familiarize himself with the constitution of the society or corporate body (in case of a company, it would be its Memorandum and Articles of Association), but once it is found that there is no restriction on the authority ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o represent it in and out of Court in any matter, whether actively or passively, save and except those important subjects which are prescribed in the internal statute of the society. In respect of these latter subjects, the President cannot act except with a resolution of the administrative body of the society. This being clearly the charter of the society, the defendants were entitled to assume that the President had the requisite authority It the defendants, acting on such assumption, entered into the subject lease, they are protected by the doctrine of indoor management. 10. If it is the plaintiff's case that the President in fact did not have such authority because the subject was one which was prescribed in the internal statute of the society, it was indeed for the plaintiff to produce and prove such internal statute. Neither in the Trial Court nor in this Court is there any attempt made by the plaintiff to produce or prove any such internal statute. In the premises, it must assumed that such internal statue entailing restrictions on the President to act or take initiative in the matter does not exist. 11. Learned Counsel for the respondent-plaintiff is not right in submit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Trial Court could never have come to the conclusion that the plaintiff has made out a case of lack of authority in its President to execute the Lease Deed; as we have noted above, the burden of proving such lack was exclusively on the plaintiff and it woefully failed in discharging it. 15. The impugned order of the learned Ad-hoc District Judge is accordingly set aside and the suit of the plaintiff is dismissed. In the facts of the case, there shall be no order as to costs. First Appeal No. 8 of 2010 16. The companion appeal, namely, First Appeal No. 8 of 2010, involves a similar decree and judgment passed by the Trial Court in a companion Special Civil Suit. That suit was in respect of a similar Lease Deed in favour of the defendants in respect of another piece of land. The basis, on which the suit was filed, was more or less the same as the basis on which the suit described above was filed. So also, the basis of the judgment delivered by the Trial Court is the same as the one in the case above. Mr. Lotlikar, learned Senior Counsel appearing for the respondent/plaintiff, submits that in addition to the invalidity of the Lease Deed on account of lack of authority on the part of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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