Madras High Court
The S-439 vs S.Paulraj on 14 March, 2019
Author: T.S.Sivagnanam
Bench: T.S.Sivagnanam
1 In the High Court of Judicature at Madras Dated : 14.3.2019 Coram :
The Honourable Mr.Justice T.S.SIVAGNANAM and The Honourable Mrs.Justice V.BHAVANI SUBBAROYAN Writ Appeal No.718 of 2019 & CMP.No.5839 of 2019 The S-439, Salem Agricultural Producer's Coop. Marketing Society Ltd., Salem-9. ...Appellant Vs
1.S.Paulraj
2.The Deputy Registrar of Cooperative Societies, Salem Circle, Salem.
3.The Principal District Judge-cum-
Tribunal for Cooperative Cases, Salem. ...Respondents APPEAL under Clause 15 of the Letters Patent against the order dated 23.8.2018 passed in W.P.No.37716 of 2016.
For Appellant : Mr.M.S.Palanisamy For Respondent-1: Mr.S.Venkataraman For Respondent-2: Mr.L.P.Shanmugasundaram, SGP (Co.op.) Judgment was delivered by T.S.SIVAGNANAM,J We have heard Mr.M.S.Palanisamy, learned counsel for the appellant, http://www.judis.nic.in 2 Mr.S.Venkataraman, learned counsel appearing for the first respondent and Mr.L.P.Shanmugasundaram, learned Special Government Pleader accepting notice for the second respondent.
2. This appeal filed by appellant – the second respondent in W.P.No. 37716 of 2016 is directed against the order dated 23.8.2018 passed in the said writ petition.
3. The said writ petition was filed by the first respondent herein challenging the judgment of the Principal District Court-cum-Tribunal for Cooperative Cases (hereinafter called the Tribunal) in CMA (CS) No.48 of 2004 dated 06.1.2016.
4. CMA (CS).No.48 of 2004 was filed by the first respondent herein challenging the surcharge order dated 23.4.2002. However, it was dismissed by judgment dated 06.1.2016. Aggrieved by that, the first respondent challenged the same by filing the said writ petition. The grounds of challenge as could be seen from the order impugned before us (order in the writ petition) were that the co-delinquent – one Govindasamy, who was working as Assistant in the appellant society, died during the pendency of the surcharge proceedings leaving no legal heirs as he was an unmarried person and that the other co-delinquent – one Mr.V.Rajendran filed a writ petition in http://www.judis.nic.in 3 W.P.No.664 of 2009 challenging the order passed by the same Tribunal in CMA (CS) No.33 of 2004, which was dismissed by judgment dated 12.9.2008. Ultimately, W.P.No.664 of 2009 was allowed by order dated 17.9.2013 as confirmed by a Division Bench of this Court vide judgment dated 01.3.2018 in WA.No.264 of 2014.
5. It was contended before the learned Single Judge by the first respondent herein that the discharge of the said Mr.Govindasamy on the ground that he died without any legal heirs, was illegal and contrary to the provisions of Rule 118 of the Tamil Nadu Cooperative Societies Rules, 1988, which mandates that in the event of death of a judgment debtor, his legal heirs should be made liable to the extent of the property of the deceased inherited by them. It was also submitted that the order dated 17.9.2013 passed in W.P.No.664 of 2009 filed by the said Mr.V.Rajendran having become final, as W.A.No.264 of 2014 filed by the society was dismissed by the Division Bench of this Court vide judgment dated 01.3.2018, the first respondent – was liable to be exonerated.
6. Before the learned Single Judge, it appears that on behalf of the official respondents, it was stated that the said Mr.Govindasamy was exonerated on a technical ground and that the Department was empowered to proceed against the legal representatives of the said Mr.Govindasamy http://www.judis.nic.in 4 under the provisions of the Tamil Nadu Cooperative Societies Act, 1983 (for short, the Act). However, such a contention raised by the learned Special Government Pleader was negatived on the ground that the same could not be adjudicated in a writ petition filed by the first respondent herein. Further, the learned Single Judge pointed out that the Hon'ble Supreme Court held that in respect of the Departmental disciplinary proceedings or similar surcharge proceedings, if the co-delinquents were exonerated, then the proceedings were liable to be quashed in respect of other delinquents also. Consequently, W.P.No.37716 of 2016 was allowed by order dated 23.8.2018 and the judgment delivered by the Tribunal in CMA (CS).No.48 of 2004 dated 06.1.2016 was quashed. The learned Single Judge observed that the appellant/official respondent was at liberty to proceed against the other responsible employees or officials in respect of their negligence or dereliction of duty so as to recover the financial loss occurred to the appellant and that while doing so, the point of limitation could not be held against the official respondents to proceed against the officials.
7. In this appeal, the appellant has challenged the order passed in the present writ petition primarily on the ground that a serious factual error has crept into the entire proceedings i.e. the proceedings, which were initiated by the said Mr.V.Rajendran as well as the proceedings initiated by the first respondent herein – writ petitioner. Therefore, it is submitted that the http://www.judis.nic.in 5 correctness of the impugned order passed by the Tribunal in the case of the first respondent herein/writ petitioner requires to be tested in the facts and circumstances and therefore, the appellant has pressed for an opportunity to enable them to argue the merits of the matter.
8. We have carefully considered the contentions raised by the submissions made on either side.
9. The surcharge proceedings were initiated by issuance of a notice dated 26.7.2001 under Section 87 of the Act. There were totally 10 articles of charge and against five persons, the allegations were made in the surcharge proceedings namely (1) Mr.S.Paulraj, the first respondent herein (writ petitioner), who was the then Special Officer of the appellant society; (2) one Mr.M.Ramamoorthy, who was the then Special Officer appeared to have taken charge after the first respondent herein – writ petitioner was transferred; (3) the said Mr.V.Rajendran, who was the then Section Officer of the appellant society; (4) the said Mr.Govindasamy, the then Supervisor of the appellant society and (5) one Mr.S.Eswaramurthy, who was an employee of the appellant society.
10. The first respondent – writ petitioner and others submitted their explanation to the allegations in the surcharge notice and the explanation http://www.judis.nic.in 6 submitted by the first respondent – writ petitioner was dated 03.11.2001. However, the second respondent herein, vide order dated 23.4.2002, had exonerated the said Mr.Ramamoorthy as well as the said Mr.Govindasamy on the ground that he died during the pendency of the surcharge proceedings after recording the facts that he was unmarried, that he had no legal heirs and that all terminal benefits were disbursed. The other three persons namely the first respondent herein – writ petitioner, the said Mr.S. Eswaramurthy and the said Mr.V.Rajendran were made either individually or jointly and severally liable to make good the loss to the society.
11. At this juncture, it will be beneficial to refer to the conclusion arrived at in the surcharge order dated 23.4.2002 fixing the responsibility and making each of the employees liable, which reads as follows :
S. Revenue Loss Amount Name & designation of the N officers held liable Item Details o.
1 Charge Purchase of shikkakai 2,61,616.20 Mr.S.Paulraj, Ex. Dy. Registrar/ 1 Spl.Officer and Mr.N. Eswaramurthy, employee of the society are made jointly and severally liable 2 Charge Purchase of chillies 6,46,923.30 Mr.S.Paulraj, Ex. Dy. Registrar/ 2 Spl.Officer and Mr.N. Eswaramurthy, employee of the society are made jointly and severally liable 3 Charge Viralli Manjal 2,87,412.50 Mr.S.Paulraj, Ex. Dy. Registrar/ 3(a) Spl.Officer and Mr.V. Rajendran, employee of the society are made jointly and severally liable Charge Turmeric 6,76,381.35 3(b) 4 Charge Purchase of turmeric 2,15,129.00 Mr.S.Paulraj, Ex. Dy. Registrar/ 4(a) through packing division Spl.Officer and Mr.N. http://www.judis.nic.in 7 Charge Purchase of turmeric 2,15,680.30 Eswaramurthy, employee of the 4(b) through packing division society are made jointly and severally liable 5 Charge Distribution of variety 3,45,660.20 Mr.S.Paulraj, Ex. Dy. Registrar/ 5 rice under agency Spl.Officer and Mr.V. Rajendran, system to cooperative employee of the society are stores made jointly and severally liable 6 Charge Revenue loss in 70,175.20 Mr.N.Eswaramurthy, employee 8 purchase of ponni boiled of the society is wholly rice responsible 7 Charge Loss of purchase of 35,864.35 Mr.S.Paulraj, Ex.Special Officer 10 supermax blade is wholly responsible Total 27,54,842.40
12. The total amount recoverable in the light of the said order dated 23.4.2002 was Rs.27,54,842.40 Ps. The said Mr.V.Rajendran – an employee of the society filed CMA (CS).No.33 of 2004 before the Tribunal as against the surcharge order dated 23.4.2002. The first respondent herein also filed an appeal in CMA(CS) No.48 of 2004 before the same Tribunal.
13. The appeal in CMA (CS) No.33 of 2004 filed by the said Mr.V. Rajendran was taken up by the Tribunal in the year 2008 and by order dated 12.9.2008, it was dismissed. Before the Tribunal, a submission was made on behalf of the appellant therein namely the said Mr.V.Rajendran that no surcharge proceedings were initiated against the Special Officer – the first respondent herein and the Section Superintendent – the said Mr.Govindasamy and that it was a clear case of discrimination. http://www.judis.nic.in 8
14. The Tribunal, in its judgment dated 12.9.2008, in paragraph 8, recorded that the learned counsel, who appeared for the Deputy Registrar of Cooperative Societies, Salem Circle, submitted that the surcharge action initiated against the said Mr.S.Paulraj, Special Officer (the first respondent herein) was dropped, as he had taken statutory action to recover the dues from the traders. The Tribunal further held that the said Mr.Govindasamy, who was the then Section Superintendent and who was unmarried, died without leaving any legal heirs and that Section 87 of the Act provided for initiation of proceedings against the legal heirs of the employee, who had committed breach of trust, misappropriation, etc. The Tribunal, after noting the submissions, held that the contention raised by the appellant therein – the said Mr.V.Rajendran that surcharge action was not initiated against the Special Officer and the Section Superintendent was unsustainable in law. A further contention that the proceedings were barred by limitation was raised in the appeal and it was rejected by the Tribunal.
15. Therefore, the said Mr.V.Rajendran filed W.P.No.664 of 2009 challenging the judgment dated 12.9.2008 rendered by the Tribunal in CMA (CS) No.33 of 2004. Ultimately, W.P.No.664 of 2009 was allowed on 17.9.2013. When we examined the reason for allowing W.P.No.664 of 2009, we find that the learned Single Judge, in paragraph 18, noted that the Special Officer – the first respondent herein was held responsible in all items, http://www.judis.nic.in 9 that the Section Superintendent (the said Mr.Govindasamy) was also held responsible for almost all the items and that the said Mr.V.Rajendran, clerk could not be held responsible for the loss while the Special Officer and the Section Superintendent were let off on unsustainable grounds. The learned Single Judge, in the order dated 17.9.2013, faulted with the society as to why no action was initiated against the legal heirs of the said Mr.Govindasamy and his properties, which were inherited by those legal heirs.
16. It is not clear as to how the learned Single Judge recorded a finding that the first respondent herein had been let off in the surcharge proceedings. Since the said Mr.S.Paulraj – the first respondent herein was not let off, the surcharge proceedings were initiated, which concluded in the surcharge order against him on 23.4.2002. He challenged the said order dated 23.4.2002 by way of separate appeal before the Tribunal by filing CMA (CS) No.48 of 2004 and the same was pending as on the date of disposal of the first writ petition namely W.P.No.664 of 2009.
17. Subsequently, CMA (CS) No.48 of 2004 filed by the first respondent herein was heard by the Tribunal and it was rejected by judgment dated 06.1.2016. This was challenged by the first respondent herein by filing the present writ petition. In the meantime, the appellant http://www.judis.nic.in 10 society challenged the order dated 17.9.2013 in W.P.No.664 of 2009 filed by the said Mr.V.Rajendran by filing W.A.No.264 of 2014 and it came to be dismissed by a Division Bench of this Court by judgment dated 01.3.2018. In paragraph of the judgment dated 01.3.2018, a Division Bench of this Court noted that the said Mr.S.Paulraj – the first respondent herein was exonerated on the ground that he had initiated steps to recover the dues from the traders.
18. We can safely assume that this observation was made based upon the observations made by the Tribunal in CMA (CS) No.33 of 2004 filed by the said Mr.V.Rajendran in paragraph 8 of the judgment dated 12.9.2008. This has been pointed out by us in the preceding paragraphs. However, what had been recorded was the submissions of the learned counsel for the appellant and it was never the case that the first respondent herein – the said Mr.S.Paulraj was exonerated of the charges. Therefore, based on the said finding that the first respondent herein was exonerated, the Division Bench of this Court proceeded to reject the appeal filed by the appellant as against the order dated 17.9.2013.
19. Mr.S.Venkataraman, learned counsel appearing for the first respondent herein would strenuously contend that in paragraph 11 of the judgment of Division Bench dated 01.3.2018, it was held that the charge http://www.judis.nic.in 11 relating to the purchase price of turmeric was vague.
20. We find from the said show cause notice dated 26.7.2001, the charges/allegations were on several grounds and the purchase price of turmeric was one among several grounds. Therefore, based on such contentions, the first respondent herein ought not to have taken a plea that the prayer sought for by him in the present writ petition should be allowed.
21. The same submission appeared to have been made before the learned Single Judge in the present writ petition by contending that the said Mr.V.Rajendran filed W.P.No.664 of 2009 before this Court, which was affirmed by the Division Bench. What is important to be noted is that W.P. No.664 of 2009 filed by the said Mr.V.Rajendran was allowed on the ground that the first respondent herein was exonerated of the charges. Thus, we are of the considered view that a factual error has occurred thereby the correctness of the judgment passed by the Tribunal in CMA (CS) No.48 of 2004 dated 06.1.2016 was never tested.
22. Mr.M.S.Palanisamy, learned counsel appearing for the appellant submits that the charge relating to purchase price of turmeric cannot be stated to be vague and in this regard, elaborately he referred to the allegations in the surcharge notice as well as the finding recorded by the http://www.judis.nic.in 12 second respondent in the surcharge order dated 23.4.2002.
23. Mr.S.Venkataraman, learned counsel appearing for the first respondent herein – writ petitioner would accept that the first respondent herein was never exonerated of the charge. But, the grievance of the first respondent is that the said Mr.Govindasamy was let off, that the charge against the said Mr.V.Rajendran was quashed and that therefore, the first respondent should be exonerated.
24. However, such a contention is not acceptable since the liability on each of the counts is joint and several and certain counts are exclusively on the first respondent. Therefore, we are of the considered view that the present writ petition namely W.P.No.37716 of 2016 should be heard and decided on merits. Since the first respondent accepted the fact that he was never exonerated of the charge and that there was a surcharge order against him, as against which, he filed an appeal, which was dismissed by the Tribunal.
25. For the above reasons, the writ appeal is allowed and the order dated 23.8.2018 made in W.P.No.37716 of 2016 is set aside. W.P.No.37716 of 2016 is restored to the file of this Court. Registry is directed to list W.P.No. 37716 of 2016 before the concerned learned Single Judge to be heard and http://www.judis.nic.in 13 decided on merits and it is open to the parties to canvass all contentions before the learned Single Judge. No costs. Consequently, the connected CMP is closed.
14.3.2019 Internet : Yes To
1.The Deputy Registrar of Cooperative Societies, Salem Circle, Salem.
2.The Principal District Judge-cum-Tribunal for Cooperative Cases, Salem. RS http://www.judis.nic.in 14 T.S.SIVAGNANAM,J AND V.BHAVANI SUBBAROYAN,J RS WA.No.718 of 2019 & CMP.No.5839 of 2019 14.3.2019 http://www.judis.nic.in