Mere negligence is not sufficient to hold individuals responsible under Section 87 of the Tamil Nadu Co-operative Societies Act, 1993, unless such negligence is also wilful.

1. In both these Civil Revision Petitions, the petitioners are aggrieved against the surcharge proceedings initiated under Section 87 of the Tamil Nadu Co-operative Societies Act ,1993.

2. By an order dated 21.3.2002, the 6th respondent herein passed the surcharge order thereby directing the petitioner in C.R.P.No.1276 of 2009, one S.Annathurai since deceased (whose legal representatives (LRs) were brought on record and they are the petitioners in C.R.P.No. 940 of 2010) and the respondents 1 and 2 herein to pay jointly and severally a sum of Rs.6,20,000/-with interest. The said surcharge proceedings were initiated on the ground that the respondents 1 and 2 herein have fabricated and forged the withdrawal slips in respect of inoperative S.B. Accounts and thereby caused loss to the Society to the tune of Rs. 6.20 lakhs. The allegation made against the petitioner in C.R.P.(NPD) No. 1276 of 2009 herein and the said Annathurai, who were working as Manager and Assistant Manager, respectively, was that they were negligent in their part in not preventing the said commissioning of the offence. Therefore, for their act of negligence, they were also held responsible for the loss sustained by the Society and consequently the surcharge proceedings were initiated and ultimately an order of recovery was made on 21.3.2002 as stated supra. Aggrieved against the same, an appeal preferred by them before the Tribunal also ended against them. During the pendency of the appeal, the said Annathurai died and the petitioners in C.R.P. No.940 of 2010 were brought on record as his LRs. Aggrieved against the said order of the Tribunal, the present Civil Revision Petitions are filed. Though in C.R.P.No. 940 of 2010 the petitioners are only the LRs of the deceased employee, who challenged the surcharge proceedings before the Tribunal, for the sake of convenience, I shall address the said Annadurai as the petitioner in C.R.P. (NPD) No.940 of 2010.

3. Though notice was served on the respondents, the respondents 1 and 2 have chosen not to appear before this court either in person or through counsel. Their names have been printed in the cause list. The only contesting respondent is the 6th respondent, who is represented by the learned Government Advocate. Heard the learned counsel appearing for the petitioners as well as the sixth respondent.

4. The learned counsel appearing for the petitioner in C.R.P.No. 1276 of 2009 submitted that a reading of the surcharge proceedings would show that only the respondents 1 and 2 herein have committed the offence and the petitioner who was working as the Manager was held responsible by stating that he was negligent as he had not prevented the same. The learned counsel submitted that the conduct of the petitioner at the best be treated only a dereliction of duty and there was no wilful negligence either pleaded or proved against the petitioner as required under Section 87 of the Tamil Nadu Cooperative Societies Act. In the absence of wilful negligence on the part of the petitioner, no surcharge proceedings could be initiated. In support of his submissions the learned counsel relied on the decisions reported in 1999 (3) MLJ 310 (M.SAMBANDAM VS. THE DEPUTY REGISTRAR (CREDIT) CO-OPERATIVE SOCIETIES) ;2009 (4) MLJ 992 ( K.AJAY KUMAR GOSH AND OTHERS VS. TRIBUNAL FOR CO-OPERATIVE CASES); R.GANAPATHY VS. DEPUTY REGISTRAR OF CO-OPERATIVE SOCIETIES (HOUSING) TIRUNELVELI AND ANOTHER ( 2009 (6) MLJ 1066) and contended that mere negligence is not sufficient to attract proceedings under Section 87 unless such negligence was also wilful. He further submitted that a criminal case filed against the petitioner though originally ended in conviction before the trial Court, ended in acquittal before the appellate Court in C.A.No. 485 of 2004 and hence the surcharge order passed against the petitioner cannot be sustained any more.

5. The learned counsel appearing in C.R.P. (NPD) No. 940 of 2010 also contended that the petitioner was f