JAI PAL Vs. STATE OF HARYANA AND OTHERS

JUDGEMENT

(1.) The petitioner has been working as Manager of Jhansa Co- operative Agriculture and Service Society Ltd; Jhansa, Tehsil and District Kurukshetra, (hereafter the Society). The accounts of the Society for the period July 1, 1975 to June 30, 1977, was audited by the Inspector Audit of the Co-operative Societies, Thanesar and an embezzlement of Rs. 58093.34 was detected. The Society consequently referred the dispute under section 55 of the Punjab Co-operative Societies Act, 1961, (hereafter the Act) against the petitioner as also respondent Nos. 4 to 6 for an amount of Rs. 71,262.60 including Rs. 6689.83 as interest and Rs. 6,478.83 as costs. The arbitration case was decided by the Deputy Registrar who vide award dated August 19, 1980, (P.1) made the petitioner liable to pay Rs. 40,822.65. The petitioner filed an appeal against the award of Deputy Registrar (P.1) which was dismissed by the Joint Secretary (Co-operative) exercising the powers of the Government under section 68/69 of the Act vide order dated June 25, 1981. (P.3). The petitioner has assailed the orders P.1 and P.3 in the present writ.

(2.) The learned counsel for the petitioner has argued that the embezzlement was detected during the audit and as such the proceedings could be initiated under section 54 of the Act. In view of the fact that the proceedings could be initiated under section 54 of the Act, the dispute could not be referred for arbitration under section 55 of the Act. The impugned order P.1 is liable to be set aside on this ground. The order P.3 upholding the order P.1 in appeal can also be not sustained. Reliance has been placed on Pentakota Siramulu v. Co-operative Marketing Society Ltd., Anakapalli and another, 1965 AIR(SC) 621. The contention of the learned counsel for the petitioner must prevail.

(3.) In Pentakota Sriramulu's case , their Lordships of the Supreme Court examined the implications of sections 49 and 51 of the Madras Co-operative Societies Act, 1932, which provisions are analogous to sections 54 and 55 respectively of the Act. Their Lordships observed:-