:1: :1: :1: IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL CIVIL CIVIL APPELLATE JURISDICTION APPELLATE JURISDICTION APPELLATE JURISDICTION WRIT PETITION NO. 963 OF 2008 Dr.Daulatrao S.Aher, Nashik ...Petitioner Versus The Hon’ble Minister for Co-operation Maharashtra State, Mumbai and Ors. ....Respondents ====== Mr.C.J.Sawant, Sr.Counsel i/by. Mr.Suresh M.Sabrad Adv. for the petitioners. Ms.P.S.Cardozo, AGP for respondent nos.1 and 2. Mr.Tejesh Dande, Adv. for respondent no.3. CORAM: S.C.DHARMADHIKARI, J. DATED: 13TH MARCH, 2008. P.C. P.C. P.C. : : : 1. This Writ Petition is directed against an Order passed by the Respondent no.1 on 31.12.2007 on an Revision Application which was filed by about 21 Applicants before him. 2. The petitioner is Applicant no.1. All these applicants were the Directors at one time of the :2: :2: :2: Respondent no.3 Sugar Factory, 3. There was a complaint made with regard to the misappropriation and misapplication/diversion of stocks of Sugar which was meant for export. The allegation appears to be that this stock which was earmarked for export, has been diverted and sold in domestic market. Upon such complaint, and acting on the Report, the Commissioner of Sugar acted of the Special Auditor, Co-operative Societies (Class-I)(Sugar) dated 16.5.2002, further steps were taken. The Auditor had recommended that the Respondent Kharkhana suffered a loss and therefore legal action be taken against the concerned persons. 4. Acting upon this report on 28.5.2002, Mr.B.K.Agle was appoionted as Inquiry Officer. Mr.B.K.Agle issued Notices under Rule 72 of the Maharashtra Co-operative Societies Rules, 1961 to the concerned persons. After they appeared, an Application was made on 8.2.2003 by these Applicants before the Officer, that they be discharged. On 20.7.2005 an Order was passed by the said Inquiry Officer on the :3: :3: :3: Applications for discharge. He rejected those Applications and decided to proceed in accordance with Section 88 of the MCS Act, 1960. 5. Aggrieved by that order of 20.7.2005, the Applicants approached the Minister and that is how he was seized of the Revision Application. On 23.12.2005 the Minster stayed further proceeding before the Inquiry Officer and thereafter heard the Revision Application. The Revision Application has been rejected on 31.12.2007 and that is why this Writ Petition under Article 226 and 227 of the Constitution of India. The Minister has observed that when the Inquiry proceeds they will have full opportunity to defend themselves. Further, the Applicants will have an access to all the documents and Records and they can prove their case by relying upon the same, so also, by leading evidence. Further, the order passed by the Inquiry Officer, if adverse to the petitioners, remedies under the Co-operative Societies are still available. In such circumstances, the Minister found no case for interference at this stage. :4: :4: :4: 6. Mr.Sawant Learned Senior Counsel appearing for the petitioner, contended before me that the impugned order proceeds on the basis that there is due compliance made with the Mandate of Section 88 read with Rule 72. Mr.Sawant, has contended that the said provisions contemplate that the authority/Inquiry Officer proceeds in the manner set out in Rule 72. He submits that Rule 72 sub-rule 1 contemplates further inquiries for finding out the extent to which the person has taken any part in the organisation or management of a Society. Thus, mere Report is not enough to direct issuance of Notice. The further inquiry may be discretionary but prima-facie it must indicate that the person proceeded against has committed the acts listed more particularly in Rule 72(1). 7. Mr.Sawant has invited my attention to these Rules and an Order passed by the Learned Single Judge of this court on the earlier Writ Petition being Writ Petition No.2294 of 2003. He submits that the Respondent no.2 was directed to decide the Application for discharge and thereafter proceed in accordance with :5: :5: :5: law. He submits that neither the order passed by this court has been adhered to nor the Rules in question. He submits that the Inquiry Officer holds that what he has already done, amounts to charges being framed. Inviting my attention to the order passed by the Inquiry Officer on 6.1.2003, he submits that the impugned order proceeds on the basis that what has been done on 6.1.2003 is framing of charges and nothing further was required to be done. 8. Mr.Sawant, submits that, this communication of 6.1.2003 is addressed to each one of the Applicant who has been proceeded against by the authorised officer. The communication is identical. As to how the individual officer or Director is responsible for the alleged diversion of stocks has not been spelt out. Further, what is the act of omission or commission which has resulted in the loss is also not spelt out. Mr.Sawant, submits that, Rule 72(1) and (2) contemplates that every person who has been proceeded against must be informed about his act with particulars. Naturally, the charges have to be specific. In such circumstances, the Minister was :6: :6: :6: obliged to apply his mind to the grievance raised in the Revision Application which have not been considered by him. In such circumstances, both orders namely dated 20.7.2005 of the Inquiry Officer and 31.12.2007 of the Minister (Revisional Authority) are vitiated by total non-application of mind and wholly erroneous. 9. Mr.Sawant, also makes a serious grievance and points out that merits apart, the Inquiry Officer in the earlier round of litigation (Writ Petition No.2294 of 2003) himself filed a detailed Affidavit and justified his action of issuance of the communication dated 6.01.2003 and virtually held the petitioner and other Applicants guilty. A copy of this Affidavit is annexed as Annexure-F to the Writ Petition and my attention has been invited to para-10, 11(a) to 11(c) and 12, so also, the penultimate paragraph namely paras-27 and 28. He has also justified the letter dated 6.1.2003 by terming the same as chargesheet. Thus, this Inquiry Officer has prejudged the issue and he is therefore unlikely to be impartial and fair during the course of the proceedings Hence, assuming without admitting that a proper chargesheet is framed, :7: :7: :7: no useful purpose will be served by submitting oneself to the jurisdiction of such an Officer, is his submission. 10. The learned AGP on the other hand has supported the Revisional Authority’s order and so also, the act of the Inquiry Officer. She submits that the petitions are delaying tactics and the Inquiry is sought to be stalled on some ground or the other. There is every reason to proceed with the inquiry as expeditiously as possible. Similar contentions have been canvassed by Mr.Dande. Mr.Dande, appearing for Respondent no.3, at one stage urged that if this court is of the opinion that the Inquiry Officer should be replaced, then, appropriate orders may be passed in the interest of justice and considering the fact that the inquiry must proceed. 11. I had called upon the learned AGP to take instructions in the light of the specific contentions reproduced above and the averments in the Writ Petition. This Writ Petition was placed before me for admission on 13.2.2008 and at the request of AGP it was :8: :8: :8: adjourned to 15.2.2008. Thereafter, it has been adjourned to 18.2.2008, 5.3.2008 and heard finally on 13.3.2008. During the course of hearing, there is no Affidavit-in-reply filed on behalf of the State Government or the Inquiry officer. 12. I am quite aware that this court should not stall any inquiry, and proceedings such as these, should not be interfered with. It is clear from the reading of the Revisional Authorities’ order, that it has proceeded only on the basis that the allegations being serious, the inquiry must proceed. That is the anxiety of Respondent no.3 also. There is much substance in this anxiety to proceed with such an Inquiry. Equally such an inquiry should not be a farce. The inquiry has to abide by the procedure that is specifically set out in law. Further, the inquiry being of the nature specified under Sub-Rule 8 read with Rule 72 and entire object being to fasten the liability for the acts of omission and commission, then, it goes without saying that such inquiries must abide by the principles of natural justice as well. In the present case, the Inquiry Officer has proceeded and :9: :9: :9: held that prima-facie there is substance in the allegations of the petitioner and others. He has rejected other Applications for discharge. He has not issued any further communication but has emphasized that he has framed charges already on 6.1.2003. It is in such circumstances, and the Affidavit filed by the Inquiry Officer being placed on record, that although I permit the inquiry to proceed and issue no directions with regard to the Inquiry Officer’s Authority and power the Inquiry Officer to continue the same, I grant liberty to the petitioners to raise all contentions that are urged before the Minister and the Inquiry Officer earlier, so also, reiterated in the Writ Petition, during the course of inquiry. If the Inquiry officer does not permit the same to be raised, then, ofcourse the remedy of the petitioner to challenge the same in Revision or Appeal, if adverse, is also intact. Further, during the course of such Revision or Appeal as well all contentions including the alleged bias of the Inquiry officer are available for being raised. These contentions are open and the orders shall not be construed as having expressed any final opinion. The Inquiry Officer, shall, if the said contentions and :10: :10: :10: objections are raised, deal with them and pass a speaking order. With all these clarifications, there is no reason to interfere at this stage. More so, considering the anxiety of the Government and the Society that the Inquiry should not be stalled or delayed any further. Writ Petition is disposed off with the above clarification. No costs. sd/- *******