Madras High Court
Maria Arputham vs The Special Officer/Secretary on 8 August, 2023
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 08.08.2023
CORAM:
THE HONOURABLE DR.JUSTICE ANITA SUMANTH
AND
THE HONOURABLE MR.JUSTICE R.VIJAYAKUMAR
W.A.(MD)No.1312 of 2014
and
M.P.(MD)No.1 of 2014
and
C.M.P.(MD)No.8732 of 2022
1.Maria Arputham
2.L.Jani Anparasu
3.Latheesh-J-Lal ...Appellants
/Vs./
1.The Special Officer/Secretary,
Moonchirai Co-operative Primary Agriculture and
Rural Development Bank Ltd.,
Marthandam, Kanyakumari District.
2.The Co-operative Tribunal/District Court,
Kanyakumari at Nagercoil,
Kanyakumari District.
3.Kanyakumari District,
Central Co-operative Bank,
Nagercoil,
Kanyakumari District.
1/10
https://www.mhc.tn.gov.in/judis
4.The Joint Registrar of
Co-operative Societies,
Nagercoil,
Kanyakumari District.
5.The Deputy Registrar of
Co-operative Societies,
Thuckalay,
Kanyakumari District.
6.The Sale Officer,
Co-operative Deputy Registrar Office,
Thuckalay,
Kanyakumari District.
7.The Registrar (Co-operative Societies),
Kilpauk,
Chennai-10. ...Respondents
PRAYER:- Writ Appeal - filed under Clause 15 of the Letter Patent Act,
to set aside the order dated 21.07.2014 made in W.P.(MD)No.14150 of
2011 on the file of this Court.
For Appellants : Mr.S.Vashik Ali
for Mr.K.Sree Kumaran Nair
For R2 to R7 : Mr.K.S.Selvaganesan
Additional Government Pleader
For R1 : Ms.B.Gayathri
for Ms.J.Anandavalli
https://www.mhc.tn.gov.in/judis
JUDGMENT
(Judgment of the Court was delivered by DR.ANITA SUMANTH , J.)
One Lawrance (in short 'employee') has been employed as
Secretary in charge of Moonchirai Co-operative Primary Agriculture
Rural Development Bank Limited at Marthandam, (in short 'Bank').
While so, he had disbursed certain loans in the year 2001 according
sanctions on 17.03.2001 and 31.03.2001. The disbursals came under the
scanner of the bank in 2009 and the Bank proposed enquiry into the
same. While so, the employee had passed away on 10.08.2006 and hence,
the enquiry had, in effect, been conducted as against a deceased person.
2. The enquiry commenced in the year 2009 and concluded
with report dated 08.05.2009. Pending further proceedings, his
properties were subject to an order of conditional attachment on
20.03.2009. The order of attachment was served on the legal heirs of
said employee on 21.03.2009.
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3. The legal heirs challenged the coercive recovery proceedings
before the Co-operative Tribunal / District Court at Nagercoil and the
Tribunal passed an order dated 13.08.2010 in C.M.A.No.10 of 2009 to
the effect that their contentions were well placed. Their specific
contention had been to the effect that no enquiry could have taken place
post the demise of the employee concerned and hence, any consequence
of the same, including the impugned attachment, was also illegal.
4.Challenging the order passed by the Tribunal, W.P.(MD)No.
14150 of 2011 had come to be filed by the Bank seeking quash of the
order passed by the Tribunal on 13.08.2010. That writ petition was
allowed, the Writ Court being of the view that despite the demise of the
employee as early as on 10.08.2005, there was nothing that stood in the
way of proceedings being taken under the provisions of the Tamil Nadu
Cooperative Societies Act, 1983 (in short 'Act') as per statute.
5.A distinction was noted as between disciplinary proceedings
abating with demise of the employee, but sufficient statutory sanction
being available for continuance of proceedings for levy of surcharge. In
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fine, it was directed by the writ Court that the District Registrar could
proceed with enquiry under Section 87 of the Act and pass orders within
the time frame that was fixed.
6. As against that order, the legal heirs of the employee are in
appeal before us. They would submit that in this case, enquiry had itself
been undertaken post demise of the employee. There was no
justification, legally or otherwise, for any proceedings to have been
initiated pursuant to an employee's demise. The statutory scheme for
levy of surcharge contemplates sufficient opportunity to be granted to the
employer to make submissions in his defence and since the employee had
passed away in 2005, nothing survives as far as the issue identified by
the Bank for enquiry was concerned.
7. Per contra, our attention has drawn to the provisions of Sections
81 and 87 of Act, that provide for enquiry and levy of surcharge, pointing
out that the statutory scheme enabled the authorities to proceed with the
matter even in case of demise of the employee.
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8. Having heard the learned counsel on either side, we are of the
view that the order of the Writ Court requires re-consideration. Section
81 provides for enquiry in respect of alleged misappropriation, fraudulent
retention of money or property, breach of trust, corrupt practice or
mismanagement in relation to that society or into any particular aspect of
working of that society. Needless to say, such enquiry could be
conducted only in the context of that employee continue in employment
of the society concerned and thus on the demise of the particular
employee, all cause of action as against that employee would cease.
9.Further, the examination into whether the employee has engaged
in acts of dereliction of duty or other lapses leading to loss suffered by
the Society can also be decided only after hearing the employee
concerned and his version of events/his defence. In the present case,
enquiry has been commenced in February 2009 concluding with the
order of attachment dated 20.03.2009, whereas the employee has himself
passed away in 2005. We are of the view that with his demise, all cause
for enquiry into any allegations in regard to his service would come to a
standstill.
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10.That apart, the direction of the learned Judge is specific to the
effect that the authorities can proceed with enquiry under Section 87 of
the Act. Such proceedings for levy of surcharge are only in consequence
of enquiry undertaken under Section 81 of the Act. In fact it is
mandatory that the copy of enquiry report under Section 81 be furnished
to the noticee, charges framed relating specifically to the delinquent
employee, and a show cause notice issued to him soliciting his defence.
11.The employee in question has passed away in 2005. The
question of the legal heirs responding to the charges or show cause notice
does not arise as they would be wholly unaware of the actions of the
employee in his official capacity. They are also not expected to be in
possession of official documents and details of matters concerning the
Bank to offer any explanation / defence on his behalf, let alone, an
informed explanation.
12.Hence, it is only after an order levying surcharge under Section
87 has been passed after hearing the employee that it would bear any
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consequence at all. That is to say, it is only once the surcharge has been
quantified by the authorities by way of an order under Section 87, is it
permissible for authorities to take action as against the legal heirs for
recovery of the amount determined.
13. In light of the discussion as above, the appellants succeed and
this writ appeal is allowed. No costs. Consequently, connected
miscellaneous petitions are closed.
[A.S.M.J.,] & [R.V.J.,]
08.08.2023
NCC :Yes/No
Index :Yes/No
Internet:Yes
ta
To
1.The Co-operative Tribunal/District Court,
Kanyakumari at Nagercoil,
Kanyakumari District.
2.Kanyakumari District,
Central Co-operative Bank,
Nagercoil,
Kanyakumari District.
https://www.mhc.tn.gov.in/judis
3.The Joint Registrar of
Co-operative Societies,
Nagercoil,
Kanyakumari District.
4.The Deputy Registrar of
Co-operative Societies,
Thuckalay,
Kanyakumari District.
5.The Sale Officer,
Co-operative Deputy Registrar Office,
Thuckalay,
Kanyakumari District.
6.The Registrar (Co-operative Societies),
Kilpauk,
Chennai-10.
https://www.mhc.tn.gov.in/judis
DR.ANITA SUMANTH, J.
AND
R.VIJAYAKUMAR, J.
ta
Order made in
W.A.(MD)No.1312 of 2014
Dated:
08.08.2023
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