Madras High Court
V.Rajendran vs The Deputy Registrar Of Coop. Societies on 17 September, 2013
Author: D.Hariparanthaman
Bench: D.Hariparanthaman
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 17.09.2013 CORAM: THE HONOURABLE MR. JUSTICE D.HARIPARANTHAMAN Writ Petition No.664 of 2009 and M.P.No.1 of 2009 V.Rajendran ... Petitioner vs. 1.The Deputy Registrar of Coop. Societies, Salem Circle, Cherry Road, Salem. 2.The Special Officer, S 439 Salem Agricultural Producers Coop. Marketing Society Ltd., Suramangalam Road, Salem 9. 3.S.Paulraj 4.The Principal District Judge/Cum Special Tribunal for Coop. Cases, Salem ... Respondents Petition filed under Article 226 of the Constitution of India for the issuance of writ of Certiorari, calling for the record to the judgment and decree dated 12.09.2008 of the 4th respondent made in C M A (CS) 33 of 2004 under Section 152 of the Tamil Nadu Coop. Societies Act 1983 quash the same. For Petitioner : Mr.S.Venkataraman For Respondents : Mr.L.P.Shanmugasundaram, Spl.G.P. For R1 Mr.A.Arumugam for R2 Mr.S.P.Harikrishnan for R3 O R D E R
The petitioner was employed as an Assistant during the period between 1992 and 1993 in the second respondent Co-operative Society. During the said period, the third respondent was the Special Officer and one S.Govindasamy was the Superintendent of the Society.
2. An enquiry under Section 81 of the Tamil Nadu Cooperative Societies Act, 1983 (for short Act) was initiated against the Special Officer the third respondent herein, one S.Govindasamy and the petitioner, with regard to the affairs of the Society, particularly to the loss caused to the society on account of purchase of turmeric and other items for higher price than the Erode Turmeric Market Price and sale of those items at a lesser price on receiving commission from Traders.
3. The Sub-Registrar of Cooperative Societies, Salem, who enquired into the matter under Section 81 of the Act gave his report dated Nil that a loss to the tune of Rs.63,89,799.85 in respect of 10 items was caused to the Society and the same shall be recovered from the Deputy Registrar/Special Officer of the Society and other employees, who are responsible for the same.
4. Based on the aforesaid report, Surcharge proceedings was initiated under Section 87 of the Act by the first respondent against the third respondent - Deputy Registrar/Special Officer, S.Govindasamy - Superintendent, the petitioner - Clerk and S.Selvarasan Junior Assistant that they were jointly and severally responsible for the loss caused to the Society. Enquiry was held with regard to the loss caused in respect of 10 items.
5. As far as the petitioner is concerned, he was held responsible along with others for the loss in respect of Item 3-A relating to the purchase of Virali Turmeric, Item 3-B relating to purchase of Turmeric and Item No.5 relating to supply of Rice.
6. As far as item 3-A is concerned, the Surcharge Notice under Section 87 of the Act dated 26.07.2001 states that the petitioner along with S.Paulraj - Deputy Registrar/Special Officer and S.Govindasamy - Superintendent jointly and severally liable to pay Rs.2,87,412.50 in the purchase of Virali Turmeric.
7. Likewise, as far as item 3-B is concerned, the Surcharge Notice under Section 87 of the Act dated 26.07.2001 states that the petitioner along with S.Paulraj - Deputy Registrar/Special Officer, S.Govindasamy - Superintendent and S.Selvarasan Junior Assistant jointly and severally liable to pay Rs.6,76,381.35 in the purchase of Turmeric.
8. As far as item 5 is concerned, the Surcharge Notice under Section 87 of the Act dated 26.07.2001 states that the petitioner along with S.Paulraj - Deputy Registrar/Special Officer and S.Govindasamy - Superintendent jointly and severally liable to pay Rs.3,45,660.20 in the purchase of Rice.
9. The Surcharge proceedings issued under Section 87 of the Act against S.Govindasamy was dropped on the ground that he died during the mean time. Paragraph 7 of the order dated 23.04.2002 passed by the first respondent under Section 87 of the Act is extracted hereunder:-
"7. jpU v!;/nfhtpe;jrhkp. r';f fz;fhzpg;ghsh; 23/7/2001 md;W ,we;J tpl;ljhf r';fj;jhy; bjhptpf;fgl;Ls;sJ/ ,th; Xa;t[ bgw;W Xa;t{jpag; gyd;fs; KGika[k; bgw;Wf;bfhz;L tpl;lhh;/ jpUkzkhfhj ,tUf;F thhpRfs; vtUkpy;iy/ ,e;epiyapy; ,thpd; tpsf;fj;ijg; bgWk; nfs;tpa[k;. neuo tprhuiz bra;a[k; epiya[k; vHtpy;iy/ ,dthhpahd KiwnfLfs; kw;Wk; mit bjhlh;ghf nkw;bfhs;sg;gl;l neuo tprhuiz gw;wpa tpguk; gpd;tUkhW//"
10. The petitioner thereafter filed an appeal against the sur-charge order dated 23.04.2002 in CMA(CS) No.33 of 2004 under Section 152 of the Act before the Tribunal. The Tribunal passed the impugned order dated 12.09.2008 rejecting the appeal. The petitioner has filed this writ petition to quash the order dated 12.09.2008 in CMA(CS) No.33 of 2004.
11. The learned counsel for the petitioner submitted that as per Section 87 of the Act, it is not a mere negligence for which employee can be proceeded against and there should have been categorical finding that it was due to 'Willful' negligence. But according to him, there is no finding at all in the order dated 23.04.2002 of the first respondent passed under Section 87 that the loss caused to the society was due to 'willful' negligence of the petitioner. This vital and relevant aspect was not considered by the Tribunal, rendering its findings perverse.
12. Further more, it is submitted that when action was dropped against the Special Officer on the sole ground that he took action under the statutes for recovery of the loss from the traders, the same yardstick shall be applied to the petitioner. But the Tribunal failed to consider the same in a proper perspective.
13. Thirdly, the learned counsel for the petitioner has submitted that action was dropped as against Govindasamy on the ground that he died. No action was taken against the legal heirs of Govindasamy on the ground that he was unmarried. It is stated that the parents of the said Govindasamy are alive and other relatives are also there and they inherited the properties of Govindasamy.
14. It was submitted that dropping action against Special Officer as well as Superintendent and taking action against lower level employee namely, the Clerk is totally discriminatory.
15. On the other hand, learned counsel for respondents 1 and 2 has relied on the counter affidavit filed and reiterated the stand taken in the counter affidavit and they sought to sustain the impugned order.
16. I have considered the submissions made by the learned counsel on either side.
17. As rightly contended by the learned counsel for the petitioner, Section 87 of the Act, makes it very clear that for an order to be passed under Section 87 of the Act directing an employee to pay the loss caused to the Society, there should be a categorical finding that the loss was caused due to 'willful' negligence and mere negligence is not sufficient. The authority should have held that the loss was caused due to willful action of the petitioner. The learned counsel for the petitioner has submitted that neither the first respondent nor the Tribunal went into this aspect and therefore, no finding was given by both the authorities as to the "willful" action of the petitioner. He has taken me through the order of the Tribunal and the Tribunal nowhere held that the loss was caused due to the willful act of the petitioner.
18. Action under Section 87 of the Act was initiated in respect of 10 items. The petitioner was concerned with Item Nos.3-A, 3-B and 5. But the Special Officer was held responsible in all the items and the Superintendent was also held responsible for almost all the items. I am of the considered view that the clerk cannot be held responsible for the loss, while the Special Officer and the Superintendent are let off on unsustainable grounds.
19. The issue raised by the petitioner was dealt by the Tribunal in Paragraph 8. Paragraph 8 is extracted here under:-
"8. The learned counsel appearing for the appellant submits that the surcharge proceedings has not been initiated against the Special Officer and Section Superintendent and that there is clear discrimination in initiating the surcharge action. Therefore, he should be exonerated from the liability on this score. The counsel appeared for the 1st respondent submits that the surcharge action initiated against Special Officer was dropped as he had taken statutory action to recover the dues from the traders. The section Superintendent is unmarried and died without leaving any legal heirs. Of course the old section 71 of the Act did not provide any initiation of surcharge action against the legal heirs of the employee but the present Act Section 87 provides for initiation of Surcharge action against the legal heirs of the employee, who had committed breach trust, misappropriation etc., Now the Superintendent died unmarried leaving no legal heirs behind him. Therefore, the contention of the appellant that surcharge was not initiated against Special Officer and Superintendent is unsustainable in law. In view of the above discussions it is decided that the society suffered loss to the wilful negligence of the appellant as such he is liable for the amount mentioned in the surcharge action and these points are answered accordingly."
20. The Tribunal accepted the submission of the first respondent that the surcharge action initiated against the Special Officer was dropped on the sole ground that he had initiated action to recover the dues from the traders. If that reason is sufficient to drop action against the Special Officer, in my considered view, the same shall be a valid reason to drop action against the petitioner.
21. Likewise, the petitioner has categorically pleaded in Ground I in the affidavit filed in support of the writ petition that though Govindasamy was unmarried person and died he left behind him his parents and others to inherit his properties. But still no action was initiated against those legal heirs to recover the loss caused to the society. It is relevant to extract ground I, which reads as follows:-
"I. It is equally an error when the 4th respondent has absolved the Superintendent of the society of the charges on the ground that the said person who was unmarried, died without leaving behind any legal heir. Such a conclusion is erroneous on the face of it. It is submitted that the said Superintendent who had complete hand in the transaction complained in the surcharge as immediate subordinate to the Special Officer and who was a party to all the decisions, was not only permitted to retire from service during the pendency of the proceedings, but was paid all his retirement benefits. But at the same time the retirement benefits of the petitioner came to be withheld due to the surcharge proceedings. It is submitted that the Superintendent who died in the course of the proceedings left behind his retirement benefits and several movable and immovable properties earned in the course of his service. It is submitted that after his death, though he did not leave behind any direct legal heir as he was not married, yet the fact remained that all his properties were inherited by his parents and other legal heirs. The 4th respondent has erroneously proceeded on the basis that a person could have legal heir only if he was married and not otherwise. The Hindu Law provides for other legal heirs which law has been lost sight of by the 4th respondent. The 4th respondent has failed to apply Rule 118 of the 1988 coop Rules wherein the procedure has been laid down when the judgment debtor dies before full satisfaction of the decree. It enables the society to proceed against the legal representatives of the deceased and such legal representatives need not necessarily be legal heirs. But all these legal grounds have been buried under the carpet only with the sole motive to victimise the petitioner. "
There is no answer for the aforesaid assertion of the petitioner.
22. For the foregoing reasons, I am of the view that the impugned order is liable to be set aside. Accordingly, the impugned order is set aside. The writ petition stands allowed. The second respondent society is directed to return the amount of Rs.75,000/- deposited by the petitioner pursuant to the order dated 19.01.2009 made in M.P.No.1 of 2009 within a period of four weeks from today. No costs.
17.09.2013 Index:Yes/No Internet:Yes/No svki D.HARIPARANTHAMAN,J.
Svki To
1.The Deputy Registrar of Coop. Societies, Salem Circle, Cherry Road, Salem.
2.The Special Officer, S 439 Salem Agricultural Producers Coop.
Marketing Society Ltd., Suramangalam Road, Salem 9.
3.The Principal District Judge/Cum Special Tribunal for Coop. Cases, Salem W.P.No.664 of 2009 17.09.2013