IMPORTANT POINT
Mere negligence in discharging duties does not warrant the initiation of Surcharge Proceedings under the Co-operative Societies Act.

ORDER :

(Prayer: Civil Revision Petition filed under Article 227 of Constitution of India, praying to set aside the C.T.A.No.09/2015, on the file of the Principal District Munsif cum Special Tribunal for Co-operative Society Cases, Vellore, dated 26.04.2017 in partly allowing 02/2014-2015, on the file of the Deputy Registrar of Co-operative Societies (Dairying), dated 10.06.2015, is even otherwise illegal, incompetent.)

1. These Civil Revision Petitions are filed challenging the order passed by the Co-operative Special Tribunal, Vellore. The Civil Revision Petition Nos.1799 to 1806 of 2023 are filed by the Vellore-Tiruvannamalai District Milk Producers Co-operative Union Limited and the Deputy Registrar of Co-operative Societies (Dairying Vellore). The other Civil Revision Petitions are filed by the delinquent employees.

2. For the sake of convenience, the petitioners in CRP.No.1799 to 1806 of 2023 are referred to as petitioners in this order. The petitioners in other revisions who are the delinquent employees are referred to as respondents in this order.

3. The first petitioner herein by his letter on 14.06.2014 requested the second petitioner to enquire into the irregularities in the daily remittance of the amounts collected from milk agents at Vaniyampadi Milk Marketing Unit. The second respondent by his proceedings dated 14.06.2014 appointed one Radhakrishnan, Co-operative Sub Registrar as enquiry officer to conduct enquiry under Section 81 of the Act. During the course of the enquiry, it was found by him that the daily collection of the advance amounts from the agents were not remitted into the bank accounts during the period from 10.06.2013 to 30.10.2013. It was found by the enquiry officer that amount collected from milk agents for supply of milk had been shown to be remitted into Vaniyampadi Branch, Canara Bank account of the first petitioner union by fabricating the bank remittance challans. But the amounts have not been really remitted into the bank. A sum of Rs.54,39,289/- was found to be misappropriated by falsification of challan. The Enquiry Officer also found that a sum of Rs.1,69,195/- had been paid as commission to the milk agents without remitting Rs.54,39,289/- collected from them and thus caused loss to the Society. It was also found that one Raja Moorthy, Selection Grade Secretary at Vaniyambadi claimed a sum of Rs.5,593/- as travelling allowance without travelling around Vaniyambadi and Tirupathur area for collection of the amount. Thus Enquiry Officer found that Society suffered a loss to the tune of Rs.56,14,077.50 paise.

4. Based on the findings of the 81 enquiry, the second petitioner herein initiated Surcharge Proceedings under Section 87 of Co-operative Societies Act against the respondents and finally passed Surcharge Order against the respondents and others. The second petitioner fixed the liability jointly and severally on the respondents and others in following manner.

5. Aggrieved by the said Surcharge Order, the respondents and some other delinquent employees preferred an appeal before the Co-operative Special Tribunal, Vellore. The Tribunal allowed the appeal and set aside the surcharge order passed against the respondents. However, the Tribunal found the respondents were negligent in discharging their duties, while cross checking the accounts and therefore, imposed a fine of Rs.1,00,000/- on each of the respondents. The Tribunal ordered that fine amount shall be paid to the first petitioner Union.

6. Aggrieved by the order passed by the Co-operative Special Tribunal setting aside the Surcharge Order passed against the respondents and others, the petitioners preferred Civil Revision Petition Nos.1799 to 1806 of 2023. Aggrieved by the imposition of fine amount, the respondents herein namely Saraswathi, Sripathy, Ganesan, Jwala Rani and Ulaganathan preferred Civil Revision Petition Nos.2622, 2627, 2628 and 3037 of 2017 and 1782/2023, respectively.

7. The learned counsel appearing for the petitioners su