Madras High Court
P.Veeran vs The Presiding Officer/ on 24 July, 2014
Author: T.Raja
Bench: T.Raja
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 24.07.2014 CORAM THE HONOURABLE MR.JUSTICE T.RAJA W.P.Nos.10 to 14 of 2010 P.Veeran .. Petitioner in W.P.No.10 of 2010 M.Arjunan .. Petitioner in W.P.No.11 of 2010 G.Velmurugan .. Petitioner in W.P.No.12 of 2010 R.Alwar .. Petitioner in W.P.No.13 of 2010 M.Balu .. Petitioner in W.P.No.14 of 2010 -vs- The Presiding Officer/ Cooperative Tribunal Principal District Court Villupuram .. 1st respondent in all the writ petitions The Deputy Registrar of Cooperative Societies Tindivanam Circle Tindivanam Villupuram District .. 2nd respondent in all the writ petitions The Special Officer CL.SPL.154 Brammadesam Primary Agricultural Cooperative Bank Brammadesam and Post Tindivanam Taluk Villupuram District .. 3rd respondent in all the writ petitions Petitions under Article 226 of the Constitution of India, praying for the issue of a Writ of Certiorari, calling for the entire records relating to the impugned order passed by the second respondent in his proceedings Na.Ka.3330/2005/Ku.Na dated 21.07.2008 confirmed by the District Court, Villupuram in C.M.A.Nos.22/2008, 18/2008, 21/2008, 16/2008 and 20/2008 respectively dated 26.10.2009 and quash the same. For Petitioners :: Mr.C.Prakasam For Respondents :: R1-Tribunal Ms.P.Rajalakshmi Government Advocate for R2 Mr.M.Dhandapani for R3 ORDER
These five writ petitions have been filed by Mr.P.Veeran, Mr.M.Arjunan, Mr.G.Velmurugan, Mr.R.Alwar and Mr.M.Balu respectively challenging the impugned order passed by the Deputy Registrar of Cooperative Societies, Tindivanam Circle, the second respondent herein in his proceedings Na.Ka.No.3330/2005/Ku.Na dated 21.07.2008, as confirmed by the Cooperative Tribunal/Principal District Court, Villupuram in C.M.A.Nos.22/2008, 18/2008, 21/2008, 16/2008 and 20/2008 respectively dated 26.10.2009, the first respondent herein and to quash the same.
2. Learned counsel for the petitioners submitted that Mr.P.Veeran, the petitioner in W.P.No.10 of 2010 was appointed as a Salesman (PDS) on 6.7.91 in Brammadesam Primary Agricultural Cooperative Bank, the third respondent herein. After eight years, he was promoted as Attender on 2.5.99. Again after eight months, he was promoted as Clerk on 1.1.2000 in the same bank. While he was serving as Clerk, the second respondent-Deputy Registrar of Cooperative Societies initiated surcharge proceedings under Section 87 on the basis of the report submitted by the enquiry officer for conducting an enquiry under Section 81 of the Tamil Nadu Cooperative Societies Act, 1983 (for short, ''the Act''). However, when the second respondent issued a show cause notice under Section 87(1) of the Act, the petitioner submitted a detailed explanation before the second respondent raising the limitation point and also non-furnishing of the enquiry report under Section 81 of the Act. In spite of the above detailed objection, the second respondent passed the order under Section 87 of the Act in his proceedings Na.Ka.No.3330/2005/Ku.Na dated 21.07.2008, as against which an appeal was preferred under Section 152 of the Act before the Cooperative Tribunal, Villupuram in C.M.A.No.22 of 2008 and the Cooperative Tribunal also dismissed the same confirming the order passed by the second respondent, as a result, the first respondent has committed a serious mistake in not properly considering that the surcharge order passed under Section 87(1) on the basis of the enquiry report cannot be accepted, since the copy of the enquiry report was not even served on the petitioner. When the impugned order under Section 87(1) of the Act cannot be passed without the service of the enquiry report under Section 81 of the Act to the petitioner, both the respondents have failed to consider this legal aspect. Moreover, the Rules 104(9)(a) and 173 of the Tamil Nadu Cooperative Societies Rules were also overlooked, ignoring the vital legal submissions made by the petitioner, the second respondent wrongly fastened the liability for a sum of Rs.3,58,64,452/- in item nos.1 to 12 and 14 and 15 of the surcharge order issued to him. The said order cannot stand to legal scrutiny, since the petitioner was appointed as Salesman on 6.7.91 and then promoted as Attender on 2.5.99, then as Clerk on 1.1.2000 and he was not assigned with any specific duties and responsibilities as Clerk on 1.1.2000. Therefore, implicating the petitioner in the surcharge proceedings in item nos.1 to 12 and 14 and 15 for the period covering 28.3.88 and 31.3.2005 cannot be legally acceptable. Moreover, when the surcharge order covers the period from 28.3.88 to 31.3.2005, the second respondent commenced the proceedings to issue surcharge order only on 15.2.2008, in the meanwhile, seven years period had expired on 28.3.95. Moreover, as mentioned above, when the petitioner was appointed only as Salesman (PDS) on 6.7.91 and Attender on 2.5.99 and again as Clerk on 1.1.2000, the surcharge order covering the period commencing from 28.3.88 till he was appointed on 6.7.91 cannot be held against him. Even this glaring mistake has not been properly seen by the second respondent and, without application of mind, the first respondent also accepted the same, therefore, the ground taken by the petitioner that he was no way connected to the irregularities, for which the surcharge proceedings were initiated from 28.3.88 to 31.3.2005, should be accepted by this Court.
3. Learned counsel further submitted that Mr.M.Arjunan, the petitioner in W.P.No.11 of 2010, was also appointed as Clerk in the third respondent bank on 19.3.96 and subsequently promoted as Senior Clerk on 18.5.2001. While so, it is not known how the initiation of surcharge proceedings under Section 87 of the Act can be put against him, when no power or responsibility was fixed on him as Senior Clerk, while fastening the liability for a sum of Rs.3,52,18,452/- in respect of item nos.1 to 4, 6 to 12 and 14 and 15 of the surcharge order, as the respondents ought to have considered carefully and clearly the nature of misconduct and the extent of deliberate negligence committed by the petitioner in the post of Clerk in the third respondent bank. When he was appointed as Clerk only on 19.3.96 and promoted as Senior Clerk only on 18.5.2001, the question of fastening the liability covering the period from 28.3.88 till he was appointed on 19.3.96 in the surcharge order is absolutely unreasonable and untenable. Therefore, the surcharge proceedings initiated against the petitioner should be held as vitiated, because no action shall be commenced against the petitioner when he was not given any power to sanction or disburse the loan nor any commission or omission of a particular act in the bank has been proved against him. Therefore, he should have been excluded from the purview of the surcharge order, because he was appointed as Clerk in the bank on 19.3.96, when the surcharge order covers the period from 28.3.88 to 31.3.2005. Adding further, the learned counsel has stated that had the surcharge order covered the period after the petitioner's appointment, one can at least appreciate that there was some reasonableness, despite the admitted fact that he was not assigned any responsibility or power to disburse the loan, as he was only a Clerk. Even for the sake of arguments, if the surcharge order covering the period from 28.3.88 to 31.3.2005 is to be accepted, the petitioner came into the services of the bank as Clerk only on 19.3.96 and got promotion as Senior Clerk only on 18.5.2001. Therefore, when he was neither serving as Clerk during the relevant point of time i.e., from 1988, the period of commission and omission for which the surcharge proceedings were initiated even before he entered into the services of the bank is absolutely unacceptable. But these vital aspects have been completely overlooked by both the respondents 1 and 2.
4. Canvassing the case of Mr.G.Velmurugan, the petitioner in W.P.No.12 of 2010, again it was stated that he was also appointed as Clerk in the bank on 5.12.96, but he was also covered under the surcharge proceedings initiated under Section 87 of the Act on the basis of the report submitted by the enquiry officer. However, the petitioner submitted a detailed explanation before the second respondent raising the limitation point and also non-furnishing of Section 81 enquiry report and also two other vital facts that when the petitioner was appointed for the first time as Clerk in the third respondent bank on 5.12.96, the surcharge order covering the period from 28.3.88 to 31.3.2005 cannot be put against the petitioner when he was not even appointed on 28.3.88, as his appointment to the post of Clerk was only on 5.12.96. When the period of eight long years from 28.3.88 to 5.12.96 had not been properly considered, the impugned order holding him responsible for the misappropriation that had taken place even before he entered the services of the bank, is not only highly unimaginable, but also far from acceptance. Since these clear and vital aspects have been completely overlooked by both the respondents 1 and 2, the impugned orders are liable to be set aside.
5. While taking on the case of Mr.R.Alwar, the petitioner in W.P.No.13 of 2010, the learned counsel submitted that he was appointed as Salesman (PDS) in the third respondent bank on 1.10.86 and after 10 years, he was promoted as Clerk/Fertiliser Salesman on 2.12.96. While he was serving as Fertiliser Salesman, the second respondent initiated surcharge proceedings under Section 87 of the Act on the basis of the report submitted by the enquiry officer. The petitioner immediately submitted a detailed explanation before the second respondent by raising the limitation point and also the non-furnishing of the enquiry report under Section 81. But the second respondent passed the order under Section 87 of the Act in his proceedings Na.Ka.No.3330/2005/Ku.Na., dated 21.7.2008, against which a statutory appeal was preferred under Section 152 of the Act before the first respondent Tribunal in C.M.A.No.16 of 2008. But the second and first respondents have failed to take into account a very crucial aspect that when the surcharge proceedings were initiated for the period covering 28.3.88 to 31.3.2005, the petitioner was not holding any sensitive post, except as Fertiliser Salesman, that too from 2.12.96 in the third respondent bank. Moreover, when the petitioner entered into the service of the third respondent only as a Salesman (PDS) on 1.10.86 and subsequently promoted as Fertiliser Salesman from 2.12.96, without there being any proof or evidence to show that he was entrusted with any power to give or disburse any loan, he cannot be held responsible by the surcharge proceedings for all the acts and omissions that had taken place in the third respondent bank from 28.3.88 to 31.3.2005. Admittedly, the petitioner was not holding the post of Secretary or Assistant Secretary or any other important position, therefore, it is not known how the second respondent could hold that the petitioner, who was serving only as Fertiliser Salesman, can cause any commission or omission, more particularly, the allegations mentioned in item nos.1 to 5 and 7.
6. Again arguing the case of Mr.M.Balu, the petitioner in W.P.No.14 of 2010, the learned counsel submitted that the petitioner was appointed as Packer in the third respondent bank on 26.5.96. He got promoted as Salesman (PDS) in the same bank on 20.10.98 and once again further got promoted as Attender on 27.3.2001. In the absence of any specific circular or order giving any responsibility or power to him to sanction or disburse any loan amount, he should not have been wrongly implicated in the surcharge proceedings in item nos.1 to 8, 14 and 15 for the period from 28.3.88 to 31.3.2005, hence, the petitioner should be excluded from the purview of the surcharge proceedings covering the above said period. Arguing further, it was stated that the petitioner being only an Attender, no order was passed assigning any specific duties and responsibilities from the date of his appointment till he was dismissed from service. Moreover, the respondents failed to consider that the allegations against him were rather vague and general, but not specific and to the point. That apart, nowhere in the surcharge proceedings, the respondents indicated that how far the petitioner was liable for the alleged financial loss incurred by the bank under various heads during the relevant period. When there is no single event or incident shown that the petitioner had wantonly caused financial loss to the society, moreover, when he was only an Attender and not assigned any specific power or duty, it is highly impossible to connect his involvement in the transactions alleged to have occurred in the third respondent bank. Concluding his arguments, he has stated that the petitioner, being an Attender in the bank, did not know anything about what had happened in the bank during the relevant period, but he was made as a scapegoat for what was not done or not decided by him, but for what was done by the Secretary as Chief Executive Officer of the bank. These vital aspects have been completely overlooked by both the respondents 1 and 2.
7. Detailed stereo-typed counter affidavits have been filed by the third respondent bank in all the writ petitions. Mr.M.Dhandapani, learned counsel appearing for the third respondent Bank, going by the averments made in the counter affidavits, submitted that the petitioners having been appointed in the bank as Salesman, Clerk/Fertiliser Salesman, Attender respectively during the relevant period of time as stated therein, have committed various irregularities including misappropriation of the bank's fund in connivance with the president, special officer and cooperative bank's staff in various items of fraud and misappropriation as detailed in the column mentioned in pages 5 to 7 of the counter affidavits, therefore, they are liable for the said loss as indicated in the surcharge order. Adding further, he has also stated that when 29 benami loans to the tune of Rs.11,21,239/- and 371 bogus loans to the tune of Rs.1,21,91,920/- were given, the petitioners were all serving, therefore, they were all held responsible for the irregularities, malpractices and misappropriation committed during the relevant period. Since the respondents 1 and 2 have correctly appreciated the said facts, the impugned orders are perfectly in order and no interference is called for with the same, he pleaded.
8. On perusal of the counter affidavits, this Court is unable to see any specific irregularity, malpractice or misappropriation said to have been committed by the petitioners during the relevant period, as the allegations are very vague and general, but not specific to the point. Moreover, when the petitioners have all been appointed to the ministerial posts without any specific duties, responsibilities or power to sanction and disburse the loan amounts to the borrowers, this Court is at a loss to understand as to how the respondents had fastened the liability in respect of various items of fraud and misappropriation on the part of the petitioners. Inasmuch as the surcharge proceedings were initiated for the acts of commissions and omissions said to have taken place from 28.3.88 to 31.3.2005 in the third respondent bank, holding the petitioners responsible for the said acts even before they entered the service of the bank, is highly unacceptable for the following reasons.
9. Mr.P.Veeran, the petitioner in W.P.No.10 of 2010 was appointed as Salesman (PDS) in the third respondent bank on 6.7.91 and thereafter he was promoted as Attender on 2.5.99 and further promoted as Clerk only on 1.1.2000. Similarly, Mr.M.Arjunan, the petitioner in W.P.No.11 of 2010, was also appointed as Clerk in the third respondent bank on 19.3.96 and subsequently he was promoted as Senior Clerk on 18.5.2001. In the same way, Mr.G.Velmurugan, the petitioner in W.P.No.12 of 2010, was also appointed as Clerk in the bank on 5.12.96 and Mr.R.Alwar, the petitioner in W.P.No.13 of 2010, was appointed as Salesman (PDS) in the third respondent bank on 1.10.86 and after 10 years, he was promoted as Clerk/Fertiliser Salesman on 2.12.96. Likewise, Mr.M.Balu, the petitioner in W.P.No.14 of 2010, was appointed as Packer in the third respondent bank on 26.5.96 and he got promoted as Salesman (PDS) on 20.10.98 and once again further got promoted as Attender on 27.3.2001. As stated already, the surcharge proceedings were initiated for the period covering from 28.3.88 to 31.3.2005. But, surprisingly, all the petitioners were appointed during 1991 and 1996 respectively in the third respondent bank, except Mr.R.Alwar who was appointed only as Salesman on 1.10.86. But the second respondent fastened the liability on all the petitioners for the alleged irregularities, malpractices and misappropriation even before they entered the service of the bank for the period from 28.3.88. Moreover, as pleaded by the learned counsel for the petitioners, when no specific duties and responsibilities were assigned to the petitioners in respect of the sanction and disbursement of the loans to the borrowers, since they were all holding only the ministerial posts, the impugned surcharge order passed by the second respondent holding all the petitioners responsible, in my view, is per se arbitrary, unreasonable and beyond the scope of any imagination. Further, this apparent and glaring omission ought not to have been lost sight of by the first respondent-Tribunal as well. Therefore, the impugned orders of the respondents 1 and 2 are liable to be interfered with not only on the ground of total non-application of mind for yet another reason that the counter affidavits do not point out any specific commissions and omissions said to have been committed by the petitioners resulting in loss to the third respondent bank. When there is no single event or incident shown in the counter affidavits that the petitioners had wantonly caused financial loss to the bank, that too, when they were not assigned with any specific power, it is highly impossible to connect their involvement in the transactions alleged to have occurred in the third respondent bank. For all these reasons, the impugned orders are set aside and the writ petitions are allowed. Consequently, M.P.Nos.1 and 2 of 2010 are closed. No costs.
Index : yes 24.07.2014
Issue copy on 23.9.2014
ss
To
1. The Presiding Officer
Cooperative Tribunal
Principal District Court
Villupuram
2. The Deputy Registrar of
Cooperative Societies
Tindivanam Circle
Tindivanam
Villupuram District
3. The Special Officer
CL.SPL.154 Brammadesam Primary
Agricultural Cooperative Bank
Brammadesam and Post
Tindivanam Taluk
Villupuram District
T.RAJA, J.
ss
Order in
W.P.Nos.10 to 14 of 2010
24.07.2014