S. Nagendra Vs. The Joint Registrar Of Co-Operative Societies Mysore Division and Others - Court Judgment

SooperKanoon Citationsooperkanoon.com/1173291
CourtKarnataka High Court
Decided OnDec-09-2014
Case NumberW.P.No. 53901 of 2014 (CS-RES)
JudgeB.S. PATIL
AppellantS. Nagendra
RespondentThe Joint Registrar Of Co-Operative Societies Mysore Division and Others
Excerpt:
(prayer: this writ petition is filed under articles 226 and 227 of the constitution of india, praying to quash the order dtd 05.04.2008 produced at annx-f passed by r-1 in surcharge no.1:2002-03 and annx-h dtd 26.09.2014 passed by hon'ble karnataka appellate tribunal in appeal no.319/2008 and annx-j issued by the r-5 in surcharge no.15/2008-09.) 1. order dated 26.09.2014 passed by the karnataka appellate tribunal, bangalore, dismissing appeal no.319/2008 is called in question in this writ petition. the said appeal was filed challenging the order dated 05.04.2008 passed by the joint registrar of co-operative societies, mysore, directing petitioner and 3rd respondent herein to pay a sum of rs.1,97,625/- along with interest at 12% to the 2nd respondent - mandya district co-operative agriculture produce marketing union limited. 2. petitioner herein was the chairman of the managing committee of the 2nd respondent - union. 2nd respondent is a union registered under the provisions of the karnataka co- operative societies act, 1959 (for short 'the act'). on the basis of allegations of certain irregularities committed by petitioner and 3rd respondent in his capacity as managing director of 2nd respondent - union, enquiry was initiated under section 64 of the act. based on the report submitted, an order was passed under section 68 of the act by the joint registrar of co- operative societies, mysore, holding that petitioner and managing director were responsible for unauthorizedly supplying fertilizers to one m/s. chamundeshwari traders - 4th respondent herein, though the said m/s. chamundeshwari traders was not the member of 2nd respondent - union. it was also alleged that no steps were taken by petitioner and the managing director to recover the dues payable by the said m/s.chamundeshwari traders. the joint registrar of co- operative societies, therefore, found the petitioner and 3rd respondent jointly and severally liable to pay a sum of rs.1,97,625/- along with interest at 12% to the 2nd respondent - union. 3. aggrieved by the said order, appeals were preferred before the karnataka appellate tribunal under section 105 of the act by petitioner and the 3rd respondent. appellate tribunal has considered the matter, re-appreciated the entire materials on record and has come to the conclusion that there were no grounds made out for interfering with the order passed by the joint registrar. consequently, appeals have been dismissed by a common judgment. 4. i have heard the learned counsel appearing for the parties. 5. on perusal of the impugned order, it is seen that petitioner herein contended before the tribunal that he had no knowledge about the audit report and that on completion of his term of president of the union, he learnt about the audit report and that it was the duty of the subsequent managing committee and the administrator to initiate action against chamundeshwari traders for recovery of the amount due from them to the union. 6. the tribunal has appreciated this contention and has come to the conclusion that the subsequent managing committee and the administrator of the union did not file any suit against chamundeshwari traders for reasons best known to them. their conduct also disclosed that they were not diligent in performing their duties, but that itself will not be a ground to exonerate the petitioner of his liability. 7. the tribunal has concurred with the findings recorded by the joint registrar that chamundeshwari traders was not one of the members of the 2nd respondent - union. the entire transaction with the said trader took place during the regime of petitioner as president. the tribunal has gone through the documents placed on record in the enquiry to hold that they reflected that all transactions with chamundeshwari traders had taken place as per the instructions of petitioner herein who was holding the post of president of the union and that there was no consent or approval of the managing committee enabling or authorizing such dealing with a non-member. the tribunal has also come to the conclusion that if the petitioner and the managing director had taken immediate action for recovery of amount due from chamundeshwari traders, they could have avoided the loss caused to the 2nd respondent - union. 8. bye-law no.7(53) of the union states that if any member of the union acts against the provisions of the act or bye-laws, they would be responsible for the 2nd respondent - union. in fact, the tribunal has referred to this bye-law and the omissions and commissions of the petitioner before concurring with the findings recorded by the joint registrar of co-operative societies. 9. in paragraph no.23 of the order, the tribunal has repelled the contention urged by petitioner that it was the managing director of the union who was responsible. the tribunal has also rejected the contention of the petitioner that it was not a case of misappropriation or misuse of funds of the union and the petitioner could not be held liable because he had not given consent for transacting with chamundeshwari traders by signing the bills. 10. findings of the tribunal disclose that on examination of the audit report and the enquiry report, it was clearly established that petitioner herein in his capacity as president of the union violated the bye-laws of the union and acted against the interest of the union in transacting with a non-member and in not initiating steps to recover the amount due from chamundeshwari traders. these findings are based on the materials on record. in the absence of any apparent illegality committed in appreciating any of the important materials on record or in coming to a perverse conclusion, this court in exercise of the power of judicial review will not upset such findings of facts to arrive at a different conclusion. 11. hence, in my view no case is made out for interference with the well considered order passed by the karnataka appellate tribunal. therefore, this writ petition being devoid of merits is dismissed.
Judgment:

(Prayer: This Writ Petition Is Filed Under Articles 226 and 227 Of The Constitution Of India, Praying To Quash The Order Dtd 05.04.2008 Produced At Annx-F Passed By R-1 In Surcharge No.1:2002-03 And Annx-H Dtd 26.09.2014 Passed By Hon'ble Karnataka Appellate Tribunal In Appeal No.319/2008 And Annx-J Issued By The R-5 In Surcharge No.15/2008-09.)

1. Order dated 26.09.2014 passed by the Karnataka Appellate Tribunal, Bangalore, dismissing appeal No.319/2008 is called in question in this writ petition. The said appeal was filed challenging the order dated 05.04.2008 passed by the Joint Registrar of Co-operative Societies, Mysore, directing petitioner and 3rd respondent herein to pay a sum of Rs.1,97,625/- along with interest at 12% to the 2nd respondent - Mandya District Co-operative Agriculture Produce Marketing Union Limited.

2. Petitioner herein was the Chairman of the managing committee of the 2nd respondent - Union. 2nd respondent is a union registered under the provisions of the Karnataka Co- operative Societies Act, 1959 (for short 'the Act'). On the basis of allegations of certain irregularities committed by petitioner and 3rd respondent in his capacity as managing director of 2nd respondent - Union, enquiry was initiated under Section 64 of the Act. Based on the report submitted, an order was passed under Section 68 of the Act by the Joint Registrar of Co- operative Societies, Mysore, holding that petitioner and managing director were responsible for unauthorizedly supplying fertilizers to one M/s. Chamundeshwari Traders - 4th respondent herein, though the said M/s. Chamundeshwari Traders was not the member of 2nd respondent - Union. It was also alleged that no steps were taken by petitioner and the managing director to recover the dues payable by the said M/s.Chamundeshwari Traders. The Joint Registrar of Co- operative Societies, therefore, found the petitioner and 3rd respondent jointly and severally liable to pay a sum of Rs.1,97,625/- along with interest at 12% to the 2nd respondent - Union.

3. Aggrieved by the said order, appeals were preferred before the Karnataka Appellate Tribunal under Section 105 of the Act by petitioner and the 3rd respondent. Appellate Tribunal has considered the matter, re-appreciated the entire materials on record and has come to the conclusion that there were no grounds made out for interfering with the order passed by the Joint Registrar. Consequently, appeals have been dismissed by a common judgment.

4. I have heard the learned counsel appearing for the parties.

5. On perusal of the impugned order, it is seen that petitioner herein contended before the Tribunal that he had no knowledge about the audit report and that on completion of his term of president of the Union, he learnt about the audit report and that it was the duty of the subsequent managing committee and the administrator to initiate action against Chamundeshwari Traders for recovery of the amount due from them to the Union.

6. The Tribunal has appreciated this contention and has come to the conclusion that the subsequent managing committee and the administrator of the Union did not file any suit against Chamundeshwari Traders for reasons best known to them. Their conduct also disclosed that they were not diligent in performing their duties, but that itself will not be a ground to exonerate the petitioner of his liability.

7. The Tribunal has concurred with the findings recorded by the Joint Registrar that Chamundeshwari Traders was not one of the members of the 2nd respondent - Union. The entire transaction with the said trader took place during the regime of petitioner as president. The Tribunal has gone through the documents placed on record in the enquiry to hold that they reflected that all transactions with Chamundeshwari Traders had taken place as per the instructions of petitioner herein who was holding the post of president of the Union and that there was no consent or approval of the managing committee enabling or authorizing such dealing with a non-member. The Tribunal has also come to the conclusion that if the petitioner and the managing director had taken immediate action for recovery of amount due from Chamundeshwari Traders, they could have avoided the loss caused to the 2nd respondent - Union.

8. Bye-law No.7(53) of the Union states that if any member of the Union acts against the provisions of the Act or bye-laws, they would be responsible for the 2nd respondent - Union. In fact, the Tribunal has referred to this bye-law and the omissions and commissions of the petitioner before concurring with the findings recorded by the Joint Registrar of Co-operative Societies.

9. In paragraph No.23 of the order, the Tribunal has repelled the contention urged by petitioner that it was the managing director of the Union who was responsible. The Tribunal has also rejected the contention of the petitioner that it was not a case of misappropriation or misuse of funds of the Union and the petitioner could not be held liable because he had not given consent for transacting with Chamundeshwari Traders by signing the bills.

10. Findings of the Tribunal disclose that on examination of the audit report and the enquiry report, it was clearly established that petitioner herein in his capacity as president of the Union violated the bye-laws of the Union and acted against the interest of the Union in transacting with a non-member and in not initiating steps to recover the amount due from Chamundeshwari Traders. These findings are based on the materials on record. In the absence of any apparent illegality committed in appreciating any of the important materials on record or in coming to a perverse conclusion, this Court in exercise of the power of judicial review will not upset such findings of facts to arrive at a different conclusion.

11. Hence, in my view no case is made out for interference with the well considered order passed by the Karnataka Appellate Tribunal. Therefore, this writ petition being devoid of merits is dismissed.