HON’BLE SRI JUSTICE G. KRISHNA MOHAN REDDY CRIMINAL PETITION No.499 OF 2009 DATE.09-12-2011 ORDER: This Criminal Petition is filed by the Petitioner/Accused No.1 (For short, ‘A-1’) under Section 482 of Cr.P.C. seeking to quash proceedings in Calender Case No.346 of 2003, pending on the file of the Court of Judicial Magistrate of First Class, Pithapuram, East Godavari District, registered for offences punishable under Sections 409, 420 and 477 I.P.C. 2. Whereas the petitioner is A-1, the respondent No.2 is the de- facto complainant in the Calender Case. For the sake of convenience, I refer the parties as arrayed in the Calender Case. 3. Briefly the prosecution version which is to be considered here is as follows : A-1 worked as the Secretary of the Chebrolu Primary Agricultural Co-operative Society (For short, ‘PACS’) Limited, during the period from 1979 to 1990 along with other staff including one clerk namely A.S.G.N. Prasad (A-2) who used to attend the office files in his absence and the Circle Supervisor of the District Co-operative Central Branch Bank namely Yellamilli Mohana Rao (A-3) who used to supervise the affairs of the society periodically. While so, on certain allegations, an inspection was conducted against A-1 and two others and the Inspecting Officer submitted his report dated 24-12-1992 alleging that A-1 and the others committed certain irregularities. Basing upon the said report, Surcharge proceedings were initiated and ultimately the Deputy Registrar of Co-operative Societies, Kakinada passed Surcharge Orders under Section 60 of the A.P. Co-operative Societies Act, 1964 on 31-01-1994 directing A-1 to pay a sum of Rs.1,63,141-84 with 18% interest p.a. Challenging the same, A-1 filed O.A. No.14 of 1994 before the A.P. Co-operative Tribunal, Vijayawada, which however, was dismissed by the Tribunal on 14-03-2000. Challenging the said order, A-1 filed Writ Petition No.23585 of 2000 before this Court and this Court after hearing arguments, allowed the Writ Petition and quashed the impugned Surcharge orders and remanded the matter to the Deputy Registrar for fresh enquiry. At that juncture, the de-facto complainant addressed a letter to the Collector, East Godavari District seeking sanction to prosecute the petitioner and the other two on the ground that A-1 violated the Surcharge proceedings. The Collector in turn gave sanction for their prosecution vide his proceedings dated 06-08-1994. Subsequently, the de-facto complainant lodged a report before the Station House Officer, Gollaprolu alleging that A-1 had misappropriated an amount of Rs.1,63,141-84 and A-2 and A-3 abetted him to commit the offence. Hence, A-1 to A-3 are liable to be punished for the alleged offences. 4. It is the contention of learned counsel for A-1 that only on the basis of the Surcharge proceedings the Criminal case was launched and subsequently the Surcharge proceedings were dropped and by virtue of Section 51 of the A.P. C-operative Societies Act, 1964 necessary enquiry has to be conducted by the concerned Deputy Registrar of Co-operative Societies only and in the enquiry, if it is revealed that A-1 involved in the misappropriation of the funds of the department, Surcharge proceedings are to be initiated under Section 60 of the Act and when the Surcharge proceedings issued to the effect that A-1 along with A-2 and A-3 committed the alleged offences were dropped and therefore he was not found guilty of committing the offences, the question of filing any Criminal case against him on the same ground would not arise at all and accordingly the Calender Case No.346 of 2003 is also liable to be quashed. In support of his contention, he has filed order dated 15-12-2006, passed by this Court in W.P. No.7794 of 2004. 5. The point for consideration is whether sufficient grounds are there in order to quash the proceedings as prayed for? 6. In fact, by virtue of Section 51 of the Act, an enquiry had to be conducted against A-1 to A-3 with regards to the allegations of misappropriation of the funds of the department and by virtue of Section 60 of the Act, necessary Surcharge proceedings were to be issued when once A-1 to A-3 were found to have misappropriated the funds of the department on the basis of the enquiry conducted. Those proceedings are the basis for the initiation of the criminal case. I do not find any legality in prosecuting A-1 on the ground that though the Surcharge proceedings were issued, ultimately those proceedings were dropped. Similar observations were made by this Court in W.P. No.7794 of 2004, a copy of which is filed before this Court under similar circumstances which are applicable here. Accordingly, the proceedings in the Calender Case are liable to be quashed. Accordingly, the Criminal Petition is allowed quashing the proceedings in C.C. No.346 of 2003 pending on the file of the Court of Judicial Magistrate of First Class, Pithapuram, East Godavari District insofar as A-1 is concerned. __________________________ G. KRISHNA MOHAN REDDY, J Dated:09-12-2011. Dsh. THE HON’BLE SRI JUSTICE G. KRISHNA MOHAN REDDY 343 CRIMINAL PETITION No.499 OF 2009 December, 09, 2011 DSH