Madras High Court
C. Ramalingam vs The Joint Registrar Of ... on 10 October, 2023
W.P.No.13663 of 2020
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 10.10.2023
CORAM:
THE HONOURABLE MS.JUSTICE R.N.MANJULA
W.P.No.13663 of 2020
&
W.M.P.Nos.16989 of 2020 & 26743 of 2023
1. C. Ramalingam
2. R. Ramasamy
3. N. Chinnappan ... Petitioners
versus
1.The Joint Registrar of Co-operative Societies,
Namakkal Region,
Namkkal.
2. The Deputy Registrar of Co-operative Societies,
Thiruchengode Circle,
Thiruchengode,
Namakkal District.
3. The President,
S-1394, Kurumbalamahadevi Primary,
Agricultural Co-operative Credit Society Ltd.,
Kurumbalamahadevi & Post,
P. Velur Taluk,
Namakkal District ... Respondents
1/11
https://www.mhc.tn.gov.in/judis
W.P.No.13663 of 2020
Prayer: Writ Petition filed under Article 226 of the Constitution of India,
praying to issue a Writ of declaration declaring the Surcharge award passed
by the second respondent u/s.87 of the Tamilnadu Co-operative Societies
Act, 1983 in Na.Ka.3540/2004/Sa.Pa. Dated 30.08.2004 is time barred and
unenforceable against the petitioners and consequently direct the
respondents to settle and disburse all the retirement benefits viz Provident
fund, Gratuity, Earned leave salary and security deposit and other monetary
benefits with interest at 12% interest p.a. from the date of retirement till the
date of actual payment.
For Petitioner : Mr. S. Kamadevan
For Respondents : Mr.G. Nanmaran,
Special Government Pleader
ORDER
Challenging the Surcharge Award passed by the second respondent in
Na.Ka.No.3540/2004/Sa.Pa, dated 30.08.2004, the present writ petition has
been filed.
2. The first petitioner was appointed as clerk on 05.05.1976, the
second petitioner was appointed as clerk on 01.06.1974 and the third
petitioner was appointed as Attender on 01.09.1972 in the third respondent
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W.P.No.13663 of 2020
society. The surcharge award was passed against the ex-Board of Directors
and the employees of the society on 30.08.2004 for payment of the revised
scale of pay pursuant to the settlement entered under Section 18(1) of the ID
Act.
3. The respondents permitted this petitioners to retire from service on
attaining superannuation, but further stated that the settlement of terminal
benefits will be subject to the outcome of the Surcharge proceedings. Since
the petitioners have not done any misappropriation or mismanagement, they
have filed this writ petition seeking declaration declaring the surcharge
award passed by the 2nd respondent in Na.Ka.3540/2004/Sa.Pa dated
30.08.2004 is time barred and enforceable against the petitioners and
consequently direct the respondents to disburse all the retirement benefits
and other monetary benefits with interest .
4. Heard both sides and perused the materials available on records
carefully.
5. It is the submission of the learned counsel for the petitioners that
Section 87(1) of the Co-Operative Societies Act does not include the salary
paid to the petitioners on an understanding that there is a settlement, for
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W.P.No.13663 of 2020
which the petitioners are entitled to get the salary so fixed. Admittedly, no
disciplinary proceedings have been initiated against the petitioners on the
allegations that they had involved in any mismanagement or
misappropriation in order to cause loss to the society. Even when there is
loss caused to the Society, the surcharge proceedings can be initiated unless
there is any willful negligence, misappropriation or mismanagement on the
part of the employee. In this regard, I feel it is relevant to refer the judgment
of the Division Bench of this Court reported in 2016 (4) LW 452
( S.Ramadevi /vs/ The Special Officer, Ambur Co-operative Sugar Mills,
Vadapudupet, Vellore District.) , wherein it is held that merely because loss
was caused to the Society, the Surcharge proceedings cannot be initiated
unless there is any willful negligence on the part of the employee or the
employee had voluntarily involved in any mismanagement or
misappropriation. In the similar line of observation, this Court has passed
the order in C.R.P.No.825 of 2020 also and the relevant part of the said
order is extracted as under :-
“ 28. As rightly pointed out by the learned Counsel for
the Revision Petitioner, by any stretch of imagination, the
definition of Section 87(1) of the Co-operative Societies Act
cannot be invoked in this particular case. None of the wording
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W.P.No.13663 of 2020
in Section 87 (1) of the Act attracts the conduct of the
Petitioner attracting the surcharge proceedings. Also, as
rightly pointed out by the learned Counsel for the Revision
Petitioner, the memo issued is not found acceptable as it is
silent about which Rule was violated . The vague definition,
“that the Society suffered loss”, will not be acceptable in any
Court of law in the light of the rulings cited by the learned
Counsel for the Petitioner in (i) (1994) 2 SCC 521 in the case
of Shyam Babu Verma and Others Vs. Union of India and
others, (ii) (2013) 16 SCC 482 in the case of Premlata Joshi
Vs. Chief Secretary, State of Uttarakhand and Others and
(iii) (2015) 4 SCC 334 in the case of State of Punjab and
others Vs. Rafiq Masih (White Washer) and others.
29.As per the reported ruling of the Hon'ble Supreme
Court in (1994) 2 SCC 521 in the case of Shyam Babu Verma
and Others Vs. Union of India and others, it was held that the
higher pay scale was erroneously given to the Petitioners
since 1973. The pay scale of the Petitioners reduced in 1984.
Since the Petitioner received higher scale due to no fault of
theirs, it shall only be just and proper not to recover any
excess amount already paid to them. Here also, the facts of the
case before this Court attracts the same ratio as laid down by
the Hon'ble Supreme Court for no fault of his the Petitioner
had works as Clerk of the H.H.484 Alaganandal Primary
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W.P.No.13663 of 2020
Agricultural Co-operative Bank. Based on the promotion
granted to him by the authority empowered to grant promotion
namely the Special Officer of H.H.484 Alaganandal Primary
Agricultural Co-operative Bank. It was not sent for approval
is not the fault of the Petitioner herein. Merely stating that the
society suffered loss cannot at all be accepted in the light of
the previous inspection in which loss was not found out, except
the salary paid to the Petitioner as Clerk for the work done by
him, that cannot be recovered.
30.As per the reported ruling in (2013) 16 SCC 482 in
the case of Premlata Joshi Vs. Chief Secretary, State of
Uttarakhand and Others, as far as payment of excess salary
made to the appellant in promotional post is concerned, we
are of the opinion that the promotion given to her is because
of the wrong exercise of the department in not applying Rules
correctly and it is not because of any misrepresentation or
suppression by the appellant, no recovery amount is called
for. This ratio squarely applies to the facts of the case before
this Court.
31.As per the reported ruling of the Hon'ble Supreme
Court in (2015) 4 SCC 334 in the case of State of Punjab and
others Vs. Rafiq Masih (White Washer) and others, the
recovery of amount paid in excess without fault of recipient,
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W.P.No.13663 of 2020
benefit of non-recovery, recoveries would be impermissible in
the following circumstances: (i) Recovery from employees
belonging to Class III and IV (Group C and D); (ii) Recovery
from retired employees, or employees who are due to retire
within one year of order of recovery; (iii) Recovery from
employees to whom excess payment have been made for a
period in excess of five years, before order of recovery is
issued; (iv) Recovery where employee is wrongfully required
to discharge duties of higher post and has been paid
accordingly and (v) In any other case, where Court concludes
that the recovery if effected from an employee would be
iniquitous or harsh or arbitrary to such an extent, as would
far outweigh equitable balance of employer's right to recover.
The observation of the Hon'ble Supreme Court is applicable to
the facts of the case as the Petitioner was appointed as Office
Assistant on compassionate ground, subsequently, considering
the financial status of H.H.484 Alaganandal Primary
Agricultural Co-operative Bank and the fact that the clerical
posts are vacant and qualified person is available as Office
Assistant, the Special Officer of the H.H.484 Alaganandal
Primary Agricultural Co-operative Bank had by the board
proceedings promoted him as Clerk which was not sent for
approval by inadvertence, there cannot be any recovery from
the Petitioner as he had worked as Clerk of H.H.484
Alaganandal Primary Agricultural Co-operative Bank.
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W.P.No.13663 of 2020
32. In the light of the above rulings and the wordings
under Section 87(1) of the Act do not indicate any wrongful
act committed by the Petitioner, it is a fact that he had worked
as a Clerk based on the promotion granted to him and drawn
salary as Clerk of the Co-operative Bank which cannot be
faulted. Therefore, the surcharge proceedings passed by the
original authority is found to be non-application of mind of
the original authority. The Appellate Authority also had not
applied its mind to the grounds of appeal preferred by the
Petitioner. Therefore, the order of the learned Principal
District Judge/Appellate Tribunal under the Co-operative
Societies Act, Thiruvannamalai confirming the surcharge
proceedings is also to be set aside.”
6. The very allegation of the first respondent is that loss has been
caused to the Society due to the wrong fixation of salary and disbursal to
the petitioners, who are the employees of the Society. Nowhere it is stated
that the petitioners had misrepresented something or involved in any act of
negligence that would cause loss to the Society. Neither it has been stated
that the petitioners have been involved in misappropriation nor any other
action of misconduct that has resulted in the loss of Society. Under such
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W.P.No.13663 of 2020
circumstances, it is wrong on the part of the respondents to presume that
Section 87(1) of the Co-Operative Societies Act is applicable to the present
context and initiate surcharge proceedings against the petitioners. In view of
the above settled legal position, the surcharge proceedings against the
petitioners lack in legality and hence, the same is liable to be quashed.
7. Accordingly, this Writ Petition is allowed and the Surcharge Award
passed by the second respondent in Na.Ka.No.3540/2004/Sa.Pa.dated
30.08.2004 is quashed and the respondents are directed to settle all the
retirement benefits with interest at the rate of 9% from the date of
retirement till the date of disbursement. No costs. Consequently, connected
Miscellaneous Petitions are closed.
10.10.2023
Speaking order / Non-speaking order
Index : Yes / No
Neutral Citation : Yes / No
mrp
https://www.mhc.tn.gov.in/judis
W.P.No.13663 of 2020
To
1.The Joint Registrar of Co-operative Societies,
Namakkal Region,
Namkkal.
2. The Deputy Registrar of Co-operative Societies,
Thiruchengode Circle,
Thiruchengode,
Namakkal District.
3. The President,
S-1394, Kurumbalamahadevi Primary,
Agricultural Co-operative Credit Society Ltd.,
Kurumbalamahadevi & Post,
P. Velur Taluk, Namakkal District
https://www.mhc.tn.gov.in/judis
W.P.No.13663 of 2020
R.N.MANJULA, J.
mrp
W.P.No.13663 of 2020
& W.M.P.Nos.16989 of 2020
& 26743 of 2023
10.10.2023
https://www.mhc.tn.gov.in/judis
