The court affirmed that suspension under Section 59 of the Act is a procedural measure pending inquiry, requiring the authority to apply its mind to the facts and evidence.

ORDER :

(Subba Reddy Satti, J.)

The above writ petition is filed challenging the proceedings issued by the 2nd respondent vide Rc.No.857/2022-C dated 22.05.2024 and the consequential suspension order issued by the 3rd respondent vide File No.1/2024 dated 31.08.2024, as illegal, arbitrary and contrary to the service conditions and provisions of the Andhra Pradesh Cooperative Societies Act, 1964 (for short “the Act”).

2. a) Petitioner, working as a clerk in the 3rd respondent society was entrusted the duties of computer operator and later appointed as Chief Executive Officer from 08.09.2021 to 01.10.2021 for 22 days. The Joint Registrar-District Cooperative Officer ordered an inquiry under Section 51 of the Act, into the affairs of the 3rd respondent-society. The inquiry officer submitted a report on the affairs of the Society and reported that an amount of Rs.438.58 lakhs was misappropriated. The inquiry officer named some of the employees and concluded that those employees are jointly and severally liable.

b) The 2nd respondent, by exercising the powers under Section 59 of the Act, directed the Person-in-Charge Committee of the 3rd respondent to suspend the petitioner and other employees by proceedings Rc.No.857/2022-C dated 22.05.2024 (Ex.P2). Thereafter, three men committee by proceedings vide File No.1/2024 dated 31.08.2024 (Ex.P1) placed the petitioner under suspension.

3. Heard Sri K.Chidambaram, learned senior counsel assisted by Sri Yashwanth Gade, learned counsel for petitioner, Sri R.S.Manidhar Pingali, learned Assistant Government Pleader for Services for respondents 1 & 2 and Sri Ganta Prasad, learned standing counsel for 3rd respondent.

4. Learned senior counsel for the petitioner would mainly contend that as per Section 59 of the Act, the 2nd respondent has to form an opinion and if any prima facie evidence against the employee is found, then alone, can direct the Society to place the employee under suspension. He would submit that case at hand, the proceedings Ex.P2 do not indicate the forming of such an opinion and thus, the 2nd respondent had not properly exercised the power and the authority carried away by the observations made by the inquiry officer. Thus, the proceedings are liable to be set aside.

5. Per contra, learned standing counsel for the 3rd respondent-Society would submit that after the inquiry report was submitted to the 2nd respondent by the inquiry officer, the 2nd respondent, in turn, forwarded the same with notings to the Joint Registrar-District Cooperative Officer vide File No.857/2022-C dated 11.03.2024. He would submit that the 2nd respondent on application of mind to the facts, directed the 3rd respondent to place the petitioner under suspension. He would further submit that suspension is not a punishment and the suspension order was passed on prima facie evidence. He would also submit that the suspension is for six months as per the service regulations and the same can be extended for six more months with the approval of the committee by recording reasons, after review. Thus, prayed to dismiss the writ petition.

6. Now, the points for consideration are:

1) Whether the 2nd respondent exercised jurisdiction strictly in consonance with Section 59 of the Act and directed the 3rd respondent-society to place the petitioner under suspension?

2) Whether Ex.P2 discerns application of mind by the authority?

7. Before delving into the matter, it is appropriate to extract Section 59 of the Act, which reads thus:

59. Suspension of officer or servant of society:—

(1) Where in the course of an audit under Section 50 or an inquiry under Section 51 or an inspection under Section 52 or Section 53, it is brought to the notice of the Registrar that a paid officer or servant of a society has committed or has been otherwise responsible for misappropriation, breach of trust or other offence, in relation to the society, the Registrar may, if in his opinion there is prima facie evidence against such paid officer or