S B NANDAGOPALAN Vs. DEPUTY REGISTRAR SURCHARGE OFFICER

JUDGEMENT

(1.) THIS Writ petition is focussed to get, issued a Writ of Certiorari calling for the records relating to the impugned notice ref. Na. Ka. No. 5209/2003, sapa. Tha. Thi. 4/2005 dated 1. 7. 2005 and quash the same.

(2.) BROADLY, but briefly, precisely, but narratively, the case of the petitioners as stood exposited from the petition could be portrayed and parodied thus: the petitioners who are ten in number, are indubitably and indisputably, the members of the Paramakudi Co-Op, Urban Bank Ltd. , Paramakudi, Ramnad district. While so, they borrowed loans from the said Co-op. , Bank. However, according to the respondents, the petitioners availed those loans by fraudulent means, so to say, by colluding with the officers and furnishing the lesser security. Subsequently, the respondents have chosen to initiate surcharge proceedings by invoking Section 87 of the Tamil Nadu Co-operative Societies Act as according to them, they came to know of such alleged fraudulent act from the enquriy report under Section 81 of the said Act. The grievance of the petitioners is that as per Section 87 of the Act, surcharge proceedings could be initiated only as against the paid servants and officers and Directors both past and present and none else. Accordingly, they prayed for quashment of the surcharge proceedings.

(3.) PER contra, denying and disputing, challenging and impugning the allegations/averments in the writ petition, the second respondent filed the counter with the averments which would run thus: the petitioners are not third parties to the Bank or to the transactions referred to in the writ petition. They are the members of the Bank and they borrowed a sum of Rs. 119 lakhs by fraudulent means to wit, by colluding with the officers and furnishing lesser security grossly disproportionate to the amount availed as loans by them. Under Section 87 of the said Act, if a member indulges in fraudulent act and avails loan and thereby caused loss to the society, certainly as against him, surcharge proceedings can be initiated. Based on the enquiry report of the officer concerned, under Section 81 of the said Act, further steps have been taken which cannot be found fault with by filing a writ petition in the manner in which the petitioner has done in this case.