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IN THE HIGH COURT OF JUDICATURE AT MADRAS
S.M. SUBRAMANIAM, J.
S. Ranganathan - Petitioner
Versus
The Deputy Registrar of Cooperative Societies, Chidambaram & Others - Respondent
W.P. No. 18916 of 2018 & W.M.P. Nos. 22305 & 22306 of 2018
Decided on : 06-03-2019
Enquiry Report - Tamil Nadu Co-operative Societies Act - 81 - The judgment discusses the provisions of Section 81 of the Tamil Nadu Co-operative Societies Act, 1983, which empowers the Registrar to hold an inquiry into the constitution, working, and financing condition of a registered society or any alleged misappropriation, fraudulent retention of money, breach of trust, corrupt practice, or mismanagement. The court interprets that any number of such inquiries can be ordered in the interest of the administration of the Cooperative Societies. The judgment emphasizes that the purpose of Section 81 is to ensure proper monitoring and control of the financial aspects of the Cooperative Societies.
Fact of the Case:
The writ petition challenges the enquiry report under Section 81 of the Tamil Nadu Co-operative Societies Act, 1983, and the consequent order of suspension passed against the petitioner, who was the Secretary of the Cooperative Society, based on allegations of certain loan transactions.
Finding of the Court:
The court finds that the second enquiry under Section 81 of the Act was permissible, as the first Enquiry Officer's report was found to be incomplete and the lapses committed necessitated a fresh enquiry to identify misappropriation of funds or irregularities in the administration of the Cooperative Societies.
Issues: The issues revolve around the permissibility of a second enquiry under Section 81 of the Act, the authority of the Registrar to order multiple inquiries, and the obligations of the employees of the Cooperative Societies during such enquiries.
Ratio Decidendi: The court holds that Section 81 of the Act allows for any number of enquiries to be ordered in the interest of the administration of the Cooperative Societies, and the Registrar is duty-bound to identify and initiate suitable actions against any irregularities or mismanagement.
Final Decision: The writ petition is dismissed as the court finds no error or infirmity in the second enquiry ordered under Section 81 of the Act, and the relief sought in the petition is devoid of merits.
Key Points: - The writ petition challenges an enquiry report under Section 81 of the Tamil Nadu Co-operative Societies Act and a consequent order of suspension (!) . - The court found that a second enquiry under Section 81 of the Act was permissible because the first Enquiry Officer's report was incomplete (!) . - Section 81 of the Tamil Nadu Co-operative Societies Act empowers the Registrar to hold inquiries into the constitution, working, and financing condition of a registered society, or into alleged misappropriation, breach of trust, or mismanagement (!) . - The purpose of Section 81 is to ensure proper monitoring and control of the financial aspects of Cooperative Societies (!) . - The court interprets that any number of inquiries can be ordered under Section 81 in the interest of the administration of Cooperative Societies (!) (!) . - Employees of Cooperative Societies are bound to cooperate with the Enquiry Officer by submitting necessary documents (!) . - The report of an enquiry under Section 81 is a fact-finding report and is a source for further actions, not a cause of action for employees to challenge the report itself (!) . - Actions permissible based on an Section 81 enquiry report include surcharge proceedings, disciplinary proceedings against employees, criminal prosecution, and superseding the elected board (!) (!) . - The Registrar is duty-bound to identify and initiate suitable actions against any irregularities or mismanagement (!) . - The writ petition was dismissed as the court found no error or infirmity in the second enquiry ordered under Section 81 of the Act (!) (!) .
(Prayer: Writ Petition filed under Article 226 of the Constitution of India praying to issue a Writ of Certiorari, calling for the records of the enquiry report under Section 81 of the Tamil Nadu Co-operative Societies Act, dated 29.11.2012 on the file of the respondents 1 and 3 and consequent order of suspension passed by the second respondent dated 6.10.2017 and quash the same.)
1. The enquiry report submitted under Section 81 of the Tamil Nadu Co-operative Societies Act, 1983 dated 29.11.2012, is under challenge in the present writ petition.
2. The learned counsel for the writ petitioner is working as Secretary of the second respondent-Cooperative Society and in respect of certain loan transactions, the allegations were made out against the functions of the Cooperative Society.
3. When it was brought to the notice of the Registrar/ Competent Authority, an enquiry under Section 81 of the Tamil Nadu Cooperative Societies Act, 1983 (hereinafter referred to as the 'Act') was ordered. The learned counsel for the writ petitioner states that the enquiry was already conducted by one Enquiry Officer, who in turn submitted his report.
4. Having not satisfied with the enquiry report in respect of certain transactions, another enquiry was ordered by the Registrar under Section 81 of the Act.
5. The learned counsel for the writ petitioner states that the second enquiry under Section 81 of the Act is impermissible. There is no necessity for the Registrar to order for the second enquiry under Section 81 of the Act, as the actions were initiated based on the enquiry report submitted by the Enquiry Officer appointed at the first instance.
6. At the outset, it is contended that second enquiry in respect of the same incident is impermissible under Section 81 of the Act.
7. The learned Special Government Pleader, appearing on behalf of the respondents, states that the Enquiry Officer, appointed at the first instance, conducted an enquiry and submitted his report. However, the competent authority found that the report submitted by the Enquiry Officer was not a full-fledged one and the Enquiry Officer had not assessed the quantum of civil liability and had not assessed the quantum of criminal liability. But he only recommended for disciplinary action against the writ petitioner.
8. Upon the scrutiny of the enquiry report, these lapses were found by the Deputy Registrar of Cooperative Societies. Thus, another Enquiry Officer was appointed to conduct the enquiry under Section 81 of the Act.
9. This apart, the person initially authorised to conduct the enquiry was charge sheeted for his lapses committed in performing his duty as an Enquiry Officer and as per Section 81(5) of the Act, the first respondent ordered for a fresh enquiry against the affairs of the second respondent-Society in proceedings dated 12.10.2011.
10. The learned Special Government Pleader for the respondents relied on the Circular No.36/2010 dated 20.12.2010, states that if at all there is any defect in the report of the Enquiry Officer, the said Enquiry Officer shall be called upon to rectify the defects or deficiencies or discrepancies on the spot. If any additional information is needed, the Enquiry Officer should be asked to furnish them without any delay. The enquiry report is perfunctory or incomplete. The Assistant Registrar/Joint Registrar or Deputy Registrar may order for a fresh enquiry and should take severe disciplinary action against the Enquiry Officer, who has given such perfunctory or incomplete report. Under these circumstances, the first respondent had ordered for a second enquiry and took severe actions against the previous Enquiry Officer.
11. The facts and circumstances of the case on hand are to be considered.
12. The fact remains that the first Enquiry Officer conducted an enquiry and committed certain lapses, deficiencies and discrepancies. Those lapses were found by the competent authorities and actions were initiated against the first Enquiry Officer. Und
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