Judgment:
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED :
01. 08.2013 CORAM THE HONOURABLE MR.JUSTICE T.RAJA W.P.No.13501 of 2010 S.Chandramouli .. Petitioner -vs- 1. The Registrar of Co-operative Societies (Housing) Nandhanam, Chennai-35 2. Tiruchirapalli Co-operative Building Society rep by its Special Officer Annanagar, Thennur Tiruchirapalli 620 017 .. Respondents Petition under Article 226 of the Constitution of India, praying for the issue of a Writ of Certiorarified Mandamus, calling for the records of the 1st respondent in Revision Petition Rc.No.3375/08 SF1 dated 06.04.2010 confirming the order of 2nd respondent in his proceedings Ref.Nil dated 14.03.2009 and quash the same and consequently direct the respondents to pay all backwages and other monetary benefits. For Petitioner :: Mr.M.S.Palaniswamy For Respondents :: Ms.T.P.Savitha Government Advocate for R1 Mr.R.K.Chandramohan for R2 ORDER
The present writ petition has been directed against the impugned order passed by the first respondent, the Registrar of Co-operative Societies (Housing), Chennai in Revision Petition Rc.No.3375/08 SF1 dated 06.04.2010, confirming the order of dismissal passed against the petitioner by the second respondent, the Special Officer, Tiruchirappalli Co-operative Building Society, in his proceedings Ref.Nil dated 14.03.2009, to quash the same with a consequential direction to the respondents to pay all the backwages and other monetary benefits.
2. Mr.M.S.Palaniswamy, learned counsel for the petitioner, attacking the impugned orders of both the respondents, contended that when the petitioner was working as a Secretary in the second respondent-Tiruchirappalli Co-operative Building Society from 2.8.76, he was only a paid officer responsible for the administration of the society subject to the control of the President or, in his absence, the Vice President, besides, the bye-law No.21(i)(a) & (b) specifically states that the Secretary cannot act on his own, but to act subject to the control of the president of the society. Moreover, when the loan application submitted by one Mr.J.Manikandan was approved and released, the Board was dissolved and in that place, the Special Officer, a Government servant, was appointed, resultantly, the said Special Officer was exercising the powers vested in the elected Board of Management. Therefore, when it is absolutely clear and unambiguous that the petitioner, as a Secretary, is under the control of the Special Officer of the society and the Special Officer, in turn, was working under the control of the Registrar of Co-operative Societies (Housing), any order or direction issued by the Registrar or Special Officer will have to be implemented by the Secretary. Moreover, a circular issued by the Registrar of Co-operative Societies (Housing) dated 18.8.88 clearly mentions the duties of the Co-operative Sub Registrars. One of the duties to be discharged by the Co-operative Sub Registrar is the investigation and scrutiny of the loan applications. While scrutinising the loan application, it is his responsibility to see that the applicant is coming within the income group, that he possesses a clear title to the properties offered for mortgage, that the properties provide adequate security for the loans and that the applicant has the required repaying capacity. Further, the said circular also makes it clear that the Co-operative Sub Registrar should verify the value of the properties offered for mortgage and indicate how he has arrived at that valuation by giving the details thereon. Moreover, he should also inspect the site with the site plan and measure the length and breadth correctly and see whether there are corner stones demarcating the site to avoid conflicting claims by neighbours on either side. Again it mandated the Co-operative Sub Registrar to see that all the columns in the loan applications are correctly filled up and that all the certificates required are furnished while dealing with the loan applications. That apart, to safeguard the funds of the society, utmost care is required in the recommendation of the loan applications. Finally, it also required the Co-operative Sub Registrar to write the report by himself and avoid entrusting work to others, particularly, the employees of the society. When the circular dated 18.8.88 issued by the first respondent-Registrar clearly prescribes the functions and responsibilities of the Co-operative Sub Registrar in the matter of granting housing loan to any applicant, question of making allegation against the petitioner that he has released loans to the members without verifying the level of construction is absolutely unfounded, because, when he was served with the charge memo on 25.6.2005 alleging inter alia that he had released the loan to the members without verifying the level of construction and that the first instalment was paid before the construction reached the level prescribed, are totally untenable and unsustainable, for the reason that he has no power to sanction the loan or order for payment of the instalments. Moreover, when the Co-operative Sub Registrar sent his report that he had inspected the site and was satisfied with the progress of construction and therefore recommended for the release of instalment, the petitioner, being a mere Secretary, cannot cross-check the report sent by the Co-operative Sub Registrar or overwrite the same. Further, when the bye-laws of the society clearly lay down the duties of the Secretary that he is only an executive and nowhere connected with the sanctioning power, the petitioner cannot be held responsible for any payment made contrary to the rules and regulations. Moreover, when seven loans were granted to Mr.J.Manikandan, two loans were already discharged and in respect of the remaining five loans remaining unsettled, suits were filed and they were all decreed. Only the execution petitions are pending. Therefore, when the two loans are fully secured and in respect of the other five loans, suits filed by the society had been decreed, there is no question of any loss caused to the second respondent society, as stated by the learned counsel for the second respondent.
3. Mr.M.S.Palaniswamy, learned counsel for the petitioner, while elaborating the conduct of the second respondent in proceeding against the petitioner with mala fide intention, stated that the second respondent, even after placing the petitioner under suspension, has not even paid the subsistence allowance in full. The non-payment of the subsistence allowance also clearly shows the prejudicial mind of the second respondent since, unless the subsistence allowance is paid to the petitioner, he will not be in a position to defend his case properly. Moreover, when repeated representations were made for supply of the relevant documents for prosecuting his defence, the petitioner was not supplied with the crucial documents stating that the documents are with the learned Chief Judicial Magistrate, Tiruchirappalli, hence, the same could not be supplied. Contending further, it was argued that when the allegation made against the petitioner showed that the petitioner had violated bye-law No.21(1)(b) and 45 to 52 of the bye-laws, since bye-law No.21(1)(b) clearly states that the Secretary can administer the society subject to the control of the President. Similarly, bye-law No.45 also says that the loan application shall be dealt with by the Board of Directors. Again bye-law No.46 states that with the approval of the general body, the Board of Directors shall act in the prescribed manner. Although the Secretary receives the loan application and places it before the Board or the Special Officer, as the case may be, only the Board or the Special Officer should take a final decision to make disbursement under bye-law No.52. Therefore, for the reason that the petitioner, being a Secretary, has to only receive the loan application and place it before the Board of the Special Officer and the final decision for disbursement of the loan should be taken as per bye-law No.52, the said aspect has been completely overlooked by the enquiry officer and also the disciplinary authority. Moreover, when the loan was sanctioned by the Special Officer along with the Sub Registrar, no action was taken against the Special Officer or the Sub Registrar. Only the petitioner alone is singled out and he has been made as a scapegoat. In any event, even this significant aspect has not been properly considered by the disciplinary authority as well as the first respondent. Therefore, it was pleaded that the impugned orders dismissing the petitioner from service even without paying the subsistence allowance in full during the period of suspension is nothing but a clear, mala fide, vindictive attitude of the respondents and, therefore, the same is required to be interfered with.
4. Per contra, Mr.R.K.Chandramohan, learned counsel for the second respondent, reiterating the statements made in the counter affidavit, further contended that while the petitioner was serving as the Secretary of the society, he failed to do his lawful duties and wilfully issued false certificates as though the building were in existence. Further, he recommended the sanction of loan to the members of the society and thereby caused loss to the society, apart from damaging the reputation of the society. Moreover, the charges mentioned in the charge memo are all about the laches in discharging the duties and responsibilities as Secretary. Therefore, he cannot shift the liability against the Sub Registrar of the society. When the petitioner was Secretary, he was an employee of the society, whereas the Sub Registrar was a government employee. Hence, the petitioner alone is responsible for all the acts of the society. Even as per the bye-law of the society, Secretary alone is responsible for all the acts. When he alone received the loan application, he was supposed to scrutinise the same and after full scrutiny, he should place it before the officials. The Co-operative Sub Registrar has nothing to do with the charges levelled against the petitioner. Moreover, when the applicants filed applications seeking housing loan, the petitioner, after receiving the loan application from one member called Mr.Manikandan, only on the basis of the scrutiny and recommendation by the Secretary, loan was sanctioned. But later it came to light that the loan sanctioned to the said member Mr.Manikandan was based on bogus patta. Moreover, the loans were sanctioned to Mr.Akbar Ali, Mr.Ponnusamy and Mr.Sivakumar even before the buildings reached the lintel level. The loan record relating to one member Mrs.Ruby Sulochana Bai shows that the loan was sanctioned to that member even before the basement level was completed, for which statutory action has been taken under the Tamil Nadu Co-operative Societies Act and an execution petition also has been filed. Further when the loans sanctioned to Mrs.N.Lakshmi and Mr.Dhandapani were alone discharged by them, it shows that the petitioner had recommended for the release of loan even without creating assets. Therefore, the charges levelled against him that he failed to discharge his lawful duties is well founded. Therefore, the stand taken by the petitioner today to try to shift the responsibility on others cannot be espoused by this Court. While replying to the submission as to the non-payment of the subsistence allowance in full, it was contended that the said allegation was not just and lawful, inasmuch as the petitioner was placed under suspension on 10.5.2002 on the basis of his arrest by the Vigilance and Anti-Corruption wing, charges were framed against him and the domestic enquiry was also ordered for taking disciplinary action. In the meanwhile, the petitioner came to this Court by filing writ petition and only by virtue of the order passed by this Court, he was paid with 50% of salary as subsistence allowance upto the period of dismissal from service. Therefore, the allegation that the petitioner was not paid with full subsistence allowance is not correct. Further, when the enquiry officer, after giving a fair and reasonable opportunity, found him guilty on the basis of evidence produced by the society, the disciplinary authority also accepted the findings of the enquiry officer and finally, losing confidence, thought it fit to dismiss him from service. That order of dismissal finally passed by the second respondent was also confirmed by the first respondent. Therefore, when the disciplinary authority and the revisional authority have repeatedly found that the charges levelled against the petitioner for causing loss to the society were finally proved and the further continuance of the petitioner in the society would cause further harm to the society, passed the order of dismissal. Therefore, the order of dismissal passed by the disciplinary authority and confirmed by the revisional authority do not call for any interference by this Court.
5. Heard the learned counsel for the parties. When the petitioner was serving as Secretary in the second respondent society, he was issued with a charge memo on 25.6.2005 containing charges, seven in number, for the various laches committed by him in the sanction of loan, as stated in the earlier portion of the order. After the receipt of charge memo, the petitioner submitted his explanation on 19.9.2005. When the explanation submitted by the petitioner was not satisfactory, the disciplinary authority appointed an enquiry officer to go into the charges levelled against the petitioner and based on the findings of the enquiry officer, a show cause notice was issued to the petitioner on 24.2.2006. However, the petitioner came to this Court by filing writ petition challenging the said show cause notice and this Court, by order dated 13.7.2007, while disposing of the writ petition, vacated the stay that was granted on 4.4.2006 and directed the petitioner to submit his explanation. However, he did not submit his explanation. Therefore, the disciplinary authority dismissed him from service on 28.9.2007. In the meanwhile, he was also arrested by the Vigilance and Anti-Corruption officials on the allegation of accepting bribe from another society member. Aggrieved by the order of dismissal, he filed a revision petition under Section 153 of the Tamil Nadu Co-operative Societies Act before the Registrar of Co-operative Societies (Housing). However, the revision petition was allowed directing the Special Officer to obtain a written reply from the petitioner for the show cause notice issued already and, after a personal hearing, to dispose of the matter. Subsequently, the petitioner submitted his explanation on 9.1.2009 and after granting a personal hearing on 24.1.2009, the Special Officer issued the dismissal order on 14.3.2009. The said order was again challenged in the revision petition. The issue revolving around the whole charge memo shows that six housing loans were sanctioned and the instalments of the loans were released without following the bye-laws of the society, because in five cases, the petitioner had released the instalments when the houses were constructed only upto basement level. Moreover, when the second instalment should be released only after the house has reached lintel level, the petitioner had released even the second instalment without verifying the stage of construction. In the sixth case, all the three instalments were released for house upgradation even though the roof was not laid. In one another case, a mortgage loan was sanctioned showing the completed house as mortgage, whereas only a vacant land was available without any house at all. As per the duties and responsibilities of the Secretary, he is only a servant of the society, therefore, the arguments advanced by the learned counsel for the petitioner that the petitioner had no power to issue loan, but he simply signed in the stage certificate along with the Co-operative Sub Registrar and Board member present do not stand to reason, because many Co-operative Sub Registrars had signed/certified the building stage and recommended to disburse the second instalment, therefore, the petitioner also had simply signed, as he has no power to cross check the recommendation made by the Co-operative Sub Registrar is vividly showing the irresponsible conduct of the petitioner in disbursing the loan money belonging to the co-operative society.
6. The report of the enquiry officer shows that when a member of the second respondent society by name Mr.T.Dhandapani residing at Ezhil Nagar, Kailasapuram, Tiruchirappalli made an application for housing loan, he was sanctioned loan in Loan No.1774 . Although the said member was sanctioned with the first instalment amount of Rs.92,000/- on 19.11.2001 and the second instalment amount of Rs.69,000/- on 7.12.2001, the fact remains, even after sanction of 70% of loan amount, the construction was only at the basement level In fact, when the first instalment of 40% of the loan should be sanctioned after the completion of the basement and the second instalment should be sanctioned only after completion of the lintel level or window level, even before the completion of the lintel level, the second instalment of Rs.69,000/- was paid. Therefore, the stand taken by the petitioner that only on the recommendation of the Co-operative Sub Registrar, the petitioner had sanctioned the first and second instalments of loan to the member Mr.T.Dhandapani, when the construction was made only upto the basement level, is absolutely bereft of any substance. The reason being that when the circular dated 18.8.88 issued by the Registrar of Co-operative Societies (Housing) clearly states that the Co-operative Sub Registrar should verify the stage of construction and recommend the drawal and disbursement of the loan as per the norms fixed in this respect, there is no record produced by the petitioner to show that the Co-operative Sub Registrar had recommended for disbursement of either the first instalment or the second instalment in favour of the member Mr.T.Dhandapani. However, one another loan application submitted by Mr.J.Manikandan dated 7.12.2001 was shown before this Court by the learned counsel for the petitioner to say that only after the approval granted by the Special Officer and the Co-operative Sub Registrar, the petitioner has signed as Secretary, therefore, the petitioner cannot be held responsible, because he was only a subordinate to both the Special Officer and the Sub Registrar, cannot take the case of the petitioner to any logical conclusion to help his case for the reason that the said document viz., mortgage deed dated 7.12.2001 of Mr.J.Manikandan for a loan of Rs.2,40,000/- does not show that the petitioner, being a Secretary, had signed only after the recommendation made by the Special Officer and the Co-operative Sub Registrar. On the other hand, it is the case of the second respondent that only after the recommendation made by the petitioner as Secretary of the society, the Special Officer and the Sub Registrar had forwarded and thereby the petitioner has mislead his superior officers, hence, the petitioner cannot get away from the charges. Similarly, in respect of sanction of housing loan of Rs.1,00,000/- to one Mrs.Ruby Sulochanabai, another member of the society is concerned, although the allegation made against the petitioner that he had sanctioned Rs.40,000/- even without the construction was completed upto the basement level, again the petitioner has not shown any satisfactory explanation, except taking the same defence that the petitioner being an employee of the society, had acted only on the recommendation of the Sub Registrar, when there was no recommendation made by the Sub Registrar having been placed before this Court directing the petitioner to sanction 40% of the loan of Rs.1,00,000/-.
7. Further, in respect of sanction of Rs.3,50,000/- loan to one another member Mr.A.Akbar Ali is concerned, the petitioner, being the Secretary, after visiting the construction site had certified that the construction had reached the lintel level, but in fact the construction was completed only just above the basement level. Therefore, when there was a specific allegation made against the petitioner that he had mislead the society as though the construction of the house by Mr.A.Akbar Ali had reached the lintel level, the petitioner had not even offered any satisfactory explanation. Moreover, on the date when the petitioner gave a wrong certificate that the construction of the house by Mr.A.Akbar Ali reached the lintel level, the petitioner is solely responsible for such sanction, as he has not properly explained his case. Similarly, one another charge levelled against the petitioner is that he had wrongly recommended for payment of housing loan of Rs.3,50,000/- to one Mr.T.Sivakumar as though the construction reached the lintel level, and when there was no such construction upto the lintel level, the sanction of 70% of the loan was again not properly explained either before the enquiry officer or before the disciplinary authority as well the revisional authority. Therefore, the enquiry officer has rightly found him guilty of all the charges. As highlighted above, when there was no explanation not to accept the findings of the enquiry officer, the disciplinary authority, agreeing with the findings of the enquiry officer, finally passed the order of dismissal and the same was also approved by the revisional authority.
8. One another aspect that requires to be mentioned here is that although both the learned counsel for the petitioner and the respondents repeatedly argued the matter for several occasions before this Court, none of the learned counsel brought to the notice of this Court the status of the criminal case registered against the petitioner by the Vigilance and Anti-Corruption department. Be that as it may, when there is no recommendation made by the Co-operative Sub Registrar or the Special Officer to the petitioner to sanction the loan, in the absence of any such approval, it is absolutely untenable for the petitioner to take a plea that only after the recommendation made by the Co-operative Sub Registrar and the Special Officer, he had disbursed the instalments of the loan to the members in question. Therefore, this Court, finding no infirmity or error in the impugned orders passed by both the respondents, dismisses the writ petition as devoid of merits. Consequently, M.P.No.2 of 2010 is also dismissed. No costs. ss To 1. The Registrar of Co-operative Societies (Housing) Nandhanam Chennai 600 035 2. The Special Officer Tiruchirapalli Co-operative Building Society Annanagar, Thennur Tiruchirapalli 620 017