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2024 Supreme(Online)(Kar) 40814
IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 4TH DAY OF JANUARY, 2024 BEFORE THE HON'BLE MR JUSTICE ANANT RAMANATH HEGDE WRIT PETITION NO. 9354 OF 2014 (CS-RES)
BETWEEN:
M/S. SADOLALU VYAVASAYA SEVA SAHAKARA BANK LTD., NOW KNOWN AS PRIMARY AGRICULTURE CREDIT CO-OPERATIVE SOCIETY LTD., SADOLALU VILLAGE, KASABA HOBLI, MADDUR TALUK, DISTRICT MANDYA - 571 428, (REPRESENTED BY ITS CEO- MR. K.R. DINESH)
…PETITIONER (BY SRI. A.C. NANJA REDDY, ADVOCATE)
AND:
1. MR. S. BOREGOWDA, S/O LATE SIDDEGOWDA, Digitally signed AGED ABOUT 70 YEARS, by BELUR RANGADHAMA R/AT SADOLALU VILLAGE, NANDINI KASABA HOBLI, MADDUR TALUK, Location: HIGH COURT OF DISTRICT MANDYA - 571 428.
KARNATAKA SINCE DECEASED REPRESENTED BY HIS LRS.
1(A). SMT. GOWRAMMA, W/O LATE S. BOREGOWDA, SINCE DECEASED BY WIFE, AGED ABOUT 75 YEARS.
1(B). SRI. S.B SIDDEGOWDA, S/O LATE S. BOREGOWDA, AGED ABOUT 51 YEARS, SINCE DECEASED BY LRS.
1(C). SRI. S.B VENKATESH, S/O LATE S. BOREGOWDA, AGED ABOUT 49 YEARS, 1(D). SRI S.B. SHIVAKUMAR, S/O LATE S. BOREGOWDA, AGED ABOUT 47 YEARS, ALL ARE RESIDING AT SADOLALU, VILLAGE MADDUR (T)
MADYA DISTRICT.
2. THE ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES, MANDYA SUB DIVISION, MANDYA - 571 401.
…RESPONDENTS (BY SRI. M.R. RAJAGOPAL, SENIOR COUNSEL ALONG WITH SRI. H.N. BASAVARAJU.,ADVOCATE FOR R1(A TO D);
SRI. M. SRINIVAS KUMAR, HCGP FOR R2)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO SET ASIDE THE IMPUGNED ORDER DATED 26.10.2013 PASSED BY HON'BLE KAT IN APPEAL NO.734/2011[CS] AT MYSORE CAMP -
VIDE ANN-D AND ETC., THIS PETITION, COMING ON FOR HEARING, THIS DAY, THE COURT MADE THE FOLLOWING:
ORDER
Heard the learned counsel for both the parties.
2. The petitioner is before this Court questioning the Order dated 26.10.2013 passed by the Karnataka Appellate Tribunal in Appeal No.734/2011. The aforementioned Appeal was filed by the contesting respondent Boregowda who is no more and represented by his legal representatives.
3. The aforementioned appeal was filed challenging the Order dated 08.07.2011 passed by the Assistant Registrar of Cooperative Societies, Mandya. In terms of the aforementioned Order dated 08.07.2011, the Assistant Registrar of Cooperative Societies directed to recover a sum of Rs.2,08,050/- with interest at the rate of 12% per annum from the 1st respondent. The said Order is apparently passed under Section 69 of the Karnataka Cooperative Societies' Act, 1959.
4. It is necessary to refer to the relevant facts.
The petitioner is the Cooperative Society. The original respondent Sri. Boregowda was the Secretary of the said Society. The petitioner is alleging that the 1st respondent has misappropriated certain amount. A dispute was raised under Section 70 of the Karnataka Cooperative Societies Act, 1959 to recover the amount alleged to have been misappropriated by the said Secretary. The said dispute under Section 70 was decided in terms of an Award dated 24.03.2003. The Arbitrator has dismissed the claim under Section 70 for want of evidence. The Society did not question the said Order.
5. The Society thereafter initiated proceedings under Section 69 of the Karnataka Cooperative Societies Act, 1959 based on the Audit Report. The Society made a claim that when under Section 70, dispute has raised, the materials were not there with the Society to substantiate its claim before the Appellate Tribunal. However, in the subsequent audit conducted by the auditor, the misappropriation is identified and based on the said report, an application is filed under Sections 68 and 69 to recover the amount which is misappropriated. The claim was accepted by the Assistant Registrar in exercise of his jurisdiction under Section 69 of the Act.
6. Aggrieved by the said Order, the ex-employee filed an appeal before the Karnataka Appellate Tribunal. The Karnataka Appellate Tribunal has allowed the appeal on the premise that the earlier claim under Section 70 of the Karnataka Cooperative Societies Act, 1959 is rejected and the Society cannot make a further claim in respect of the same amount pertaining to the same transaction which is adjudicated earlier. Accordingly, the appeal was allowed and order passed under Section 69 was set-aside.
7. Learned counsel appearing for the petitioner would submit that the Appellate Authority is not justified in allowing the appeal on the premise that the earlier dispute under Section 70 is adjudicated against the Society. He would contend that the Society is entitled to raise a dispute under Sections 68 and 69 after collecting the materials on record to substantiate its claim. It is also his contention that the audit report is not questioned by the respondent as such, the Order of the Appellate Authority is erroneous.
8. Learned Senior Counsel Sri. M.R. Rajagopal appearing for the 1st respondent would contend that the Society cannot raise a dispute for the second time after having lost the battle in the first round. It is also his contention that Section 70(2)(d) of the Act enables the Society to raise a dispute to recover the alleged dues payable to the Society and the said dispute is adjudicated based on the materials available on record. The Society is not enabled under law to raise one more dispute under Section 69 in respect of the same transaction which was alleged earlier. It is also his contention that the Appellate Authority has taken a view that the audit report is not proved in accordance with law as the Auditor is not examined.
9. This Court has considered the contentions raised by the parties under Section 70(2)(d) of the Karnataka Cooperative Societies Act, 1959 which reads as under :
