POOSAPATI MADHAVA VARMA Vs. DISTRICT COLLECTOR VISAKHAPATNAM

JUDGEMENT

(1.) The petitioner in W P. No 530 of 1978 was the President of the Visakhapatnam District Co-operative Marketing Society Limited Visakhapatnam (referred to in this judgment as the Society) between the years 1946 and 1972 and the petitioner in W,P. No. 1533 of 19i8 was one of the Directors of the Committee during the period 11-2-1962 to 1-6-1-72 The Society paid a sum of RS 10.000/- to the Assistant Procurement Officer of the Society of food grains for the Society through purchasing agents. The purchasing agents presented a bill for RS. 15,764.27 and this was settled on 31-7-1947. Later on it was found that when the bill was settled, the amount. of RS. 10.000.00 was not deducted from the bill. Thereupon the Society filed a claim No. 51/48-49 before the Deputy Registrar. Visakhapatnam claiming the sum of RS. 10.000.00- from the purchasing agents The claim was allowed. The purchasing agents preferred a revision petition to the Joint Registrar of the Co-operative Society who held that the Assistant Procurement Officer himself was responsible for the amount and he had to make the same. Against the judgment the Society preferred a provision petition to the Government of Andhra Pradesh who observed in their Memorandum D/- 26-5-1965 that Society should have proceeded against the Assistant Procurement Officer for his negligence and dereliction of his duty resulting in loss to the Society. After receipt of one memo the Assistant Procurement officer was kept under suspension and subsequently by a resolution dated 9-12-1968 or the Board of Directors he was ordered to be removed and an order of removal was passed. No steps were however taken to recover the amount from the Assistant Procurement Officer. Thereupon, the District Collector issued a notice under S. 60 (1) of the Act to all the Directors stating that they had caused deficiency in the assets of the Society by their willful negligence in not recovering the amount from the Assistant Procurement Officer and requiring them to re-pay the amount. The President as well as the other Directors submitted their explanation. They contended that it was the responsibility of the Business manager of the Society to collect the amount an; the Directors could not be made liable The district Collector did not accept their explanation and held that the deficiency of RS, 10000/- was caused on ac count of willful negligence on the par of the Directors. As against the said order, the petitioners in both the Writ Petitions preferred appeals to the Sub ordinate Judge Visakhapatnam under Sec. 76 of the Act. The learned Subordinate Judge held that in the circumstances of the case, the petitioners were guilty of willful negligence resulting loss to the society and hence the president and other directors were both jointly and severally liable to make good to the society in a sum of RS 10,000/- with interest at 12% from 25-5-1965. Challenging the validity of the said order the President of the society has file W. P, No. 530/78 and one of the Director has filed W. P, No, 1533/78.

(2.) The common question for consideration is whether the President an Directors can be said to be guilty willful negligence in not recovering the amount from the Assistant Procurement officer.

(3.) The main contention before the District Collector as well as the Subordinate Judge in appeal was that was the duty of the office Manager to recover the amount and hence the President Find the Directors are not. liable This contention is obviously untenable as under the Co-operative Societies Act the entire management of the society vested in the committee.