IN THE HIGH COURT FOR THE STATES OF PUNJAB AND HARYANA AT CHANDIGARH (1) CWP No.12692 of 2009 Hardev Singh … Petitioner Versus Secretary (Cooperation), Punjab Civil Secretariat, Chandigarh and others. …Respondents (2) CWP No.12694 of 2009 Ranbir Singh … Petitioner Versus Secretary (Cooperation), Punjab Civil Secretariat, Chandigarh and others. …Respondents CORAM : HON’BLE MR.JUSTICE MEHINDER SINGH SULLAR Present: Mr.B.S.Sehra, Advocate for the petitioner Mr.Palwinder Singh, Sr.DAG, Punjab for respondent Nos.1 to 3. Mr.Rakesh Verma, Advocate for respondent Nos.4 and 5. Date of decision : 18.04.2011 Mehinder Singh Sullar , J . (Oral) As identical questions of law and facts are involved, therefore, I propose to decide the above indicated two writ petitions by means of a common order, to avoid the repetition. However, the epitome of facts, which needs a necessary mention for deciding the instant writ petitions and emanating from the record is that petitioner-Hardev Singh in CWP No.12692 of 2009 had applied for a loan of Rs.7 lacs, while petitioner- Ranbir Singh in CWP No.12694 of 2009 applied for a loan of Rs.5 lacs for CWP No.12692 and 12694 of 2009 the purpose of running the Transport business of trucks and spare motor parts, which was sanctioned by the Ludhiana Primary Cooperative Agricultural Development Bank Ltd. Ludhiana-respondent No.4 (for brevity ‘the bank’), which is governed by the provisions of The Punjab Cooperative Societies Act, 1961 (hereinafter to be referred as ‘the ‘Act’). They submitted their respective documents and project reports. Petitioner- Hardev Singh claimed that only part amount of loan i.e. Rs.2,70,000/- in two installments of Rs.1,35000/- each was advanced to him while an amount of Rs.2,97,000/- in two installments of Rs.1,62,000/- and Rs.1,35,000/- was advanced to the petitioner-Ranbir Singh by the bank for the purpose of purchasing the machinery. According to the petitioners, the bank did not release the remaining amount of the loan despite repeated requests which necessitated them to raise a dispute under Section 55 of the Act before the Arbitrator claiming the compensation in this regard. 2. The reference petitions filed by them, were dismissed by the Arbitrator vide impugned Award dated 27.6.2006 (Annexure P-1). Dissatisfied with the award (Annexure P-1), the petitioners preferred appeals, which were dismissed as well, by the appellate authority, by means of orders dated 15.1.2007 (Annexure P-2). The revision petitions filed by them also met with the same fate and were dismissed by the Secretary, Cooperation (A), Punjab, Chandigarh-respondent No.1 (exercising the powers of the State Govt.), by way of impugned order dated 26.8.2008 (Annexure P-3). 3. Petitioners still did not feel satisfied and preferred the present writ petitions, challenging the impugned orders (Annexures P-1 to P-3), invoking the provisions of Article 226 and 227 of the Constitution of India. 2 CWP No.12692 and 12694 of 2009 4. The case set up by the petitioners, in brief insofar as relevant, was that they have suffered huge losses and they were neither required to pay/return the loan amount advanced to them by the bank as the same has been spent on the purchase of machinery nor the bank was entitled to recover the interest on it. 5. Leveling a variety of allegations and narrating the sequence of events, in all, the petitioners have challenged the impugned orders, inter alia, on the grounds (i) that the authorities did not apply their legal mind while deciding the subject matter of dispute and (ii) the impugned orders were stated to be non-speaking, arbitrary and illegal. On the basis of the aforesaid allegations, the petitioners sought the quashment of the impugned orders (Annexures P-1 to P-3) in the manner indicated hereinabove. 6. The respondents contested the claim of the petitioners and respondent Nos.4 and 5 filed their written statement, inter alia, pleading certain preliminary objections of maintainability of the petitions, cause of action and locus standi of the petitioners. 7. On merits, the contesting respondents claimed that, having released the two installments of the loan to the petitioners, the Inspector of the bank visited and inspected their units. During the course of inspection, it revealed that petitioners had mis-utilized the loan which was advanced to them and was not utilized for the purpose as per the bilateral agreement between the parties. Keeping in view the report of the Inspector, the bank stopped the advancement of the remaining amount of loan as per the terms and conditions of the agreement. Not only that, the petitioners filed their respective affidavits along with the loan applications, in which, they have specifically mentioned that they will not mis-utilize the loan advanced to 3 CWP No.12692 and 12694 of 2009 them but they have violated the terms and conditions of the agreement with impunity. 8. According to the contesting respondents that they have raised arbitration reference under Sections 55-56 of the Act against the petitioners and Arbitrator passed the award dated 4.5.2000 (Annexure R-1) in both the cases, against them after considering the pros and cons of the matters which was stated to have already attained the finality. In all, according to the respondents, since the petitioners have violated the terms and conditions of the loan agreement, so the Arbitrator, Appellate Authority and Revisional Authority have rightly negatived their claim, by way of impugned orders (Annexures P-1 to P-3), which were stated to be legal and valid. It will not be out of place to mention here that contesting respondents have stoutly out- rightly denied all other allegations contained in the writ petitions and prayed for their dismissal. 9. Having heard learned counsel for the parties, having gone through the record with their valuable assistance and after bestowal of thoughts over the entire matter, to my mind, there is no merit in the instant writ petitions in this context. 10. Ex-facie, the arguments of the learned counsel that since the respondents-bank did not make the payment of entire loan amount, causing huge losses to the petitioners so they are entitled to claim the compensation in this behalf, but the authorities below fell in error in declining their claim, are not only devoid of merits but misplaced as well. 11. As is evident from the record that the petitioners applied for loan for a specific purpose after submitting their respective loan documents and project reports, and executed loan agreements in this regard. They have 4 CWP No.12692 and 12694 of 2009 also filed their affidavits that they will not mis-utilize the loan amount. It is not a matter of dispute that the bank had advanced two installment of loan to the petitioners. The Inspector of the bank visited their units. During the course of inspection, it revealed that the petitioners have mis-utilized the amount of loan and have not spent the same for the purpose for which it was taken as per terms and conditions of the loan agreement. Even they did not submit the utilization certificate. That means the bank have the valid reasons to withhold the remaining amount of loan and petitioners cannot claim any compensation by raising such frivolous dispute in this regard under Section 55 of the Act. The Arbitrator has noticed that they have mis-utilized the loan amount and raised a false dispute by filing the frivolous petition, in order to delay the repayment of the loan. Moreover, it stands proved on record that in the wake of dispute raised by the contesting respondents, the Arbitrator has passed the awards (Annexure R-1) against the petitioners which have already attained the finality. Therefore, the contrary argument of the learned counsel that the petitioners are entitled to compensation, ‘stircto- sensu’ deserves to be and is hereby repelled under the present set of circumstances. 12. There is another aspect of the matter, which can be viewed from a different angle. It is not a matter of dispute that petitioners had applied for loan which was sanctioned and two installments were released to them. Instead of utilizing the loan amount for the purpose it was taken as per terms and conditions of the loan agreement, they mis-utilized the loan which came to the notice of the authorities at the time of inspection of their respective units. Instead of paying the loan amount, in pursuance of the award (Annexure R-1), the petitioners have raised another dispute. The 5 CWP No.12692 and 12694 of 2009 Arbitrator after taking into consideration entire material and the report of the Inspector of the bank, came to the definite conclusion that the petitioners are at fault and they cannot claim compensation in the indicated arbitration proceedings and rightly negatived their claim vide impugned award (Annexure P-1). 13. Not only that, the matter was re-examined by the appellate authority by way of impugned order (Annexure P-2) and again by revisional authority, by means of two impugned orders (Annexure P-3), the operative part of which is as under:- “I have heard the arguments adduced by the counsel for the parties and perused the record of the case. I find that the petitioners have given their respective affidavits in the Bank that they will properly utilize the loan amount as meant for. But they did not do so and not submitted the utilization certificate of the loan amount received by them. Therefore, the Bank has not further advanced the remaining loan amount to the petitioners. Further, it is fact that the petitioner-Hardev Singh took loan of Rs.2,70,000/- in two installments of Rs.1.35 lacs each while petitioner-Ranbir Singh took loan of Rs.2,97,000/- in two installments of Rs.1.62 lacs and Rs.1.35 lcas from the Bank and instead of paying back the installments of advanced amount, they are restoring to unwarranted litigation as to delay the payment of the loan amount. Therefore, I find no merits in the revision petition and the same is dismissed accordingly.” 14. Meaning thereby, the authorities have recorded the valid reasons and rightly negatived the claim of the petitioners on the basis of evidence on record by virtue of the impugned orders (Annexures P-1 to P- 3). Such orders containing valid reasons, cannot legally be interfered with, in exercise of writ jurisdiction of this Court unless, the same are perverse 6 CWP No.12692 and 12694 of 2009 and without jurisdiction. As no such patent illegality or legal infirmity has been pointed out by the learned counsel for the petitioners, therefore, the impugned orders are hereby maintained in the obtaining circumstances of the case. 15. No other legal point, worth consideration, has either been urged or pressed by the learned counsel for the parties. 16. In the light of aforesaid reasons, as there is no merit, therefore, the instnat writ petitions are hereby dismissed as such. (Mehinder Singh Sullar) Judge 18.04.2011 sd Whether to be referred to reporter? Yes. 7