THE HON'BLE SRI JUSTICE L.NARASIMHA REDDY WRIT PETITION No.17718 of 2009 ORDER: The petitioner is working as Cashier in the District Cooperative Central Bank Limited, East Godavari District, respondent No.5 herein. Varahi Primary Agricultural Cooperative Credit Society Limited, respondent No.4 herein, is under the managerial control of respondent No.5. On noticing that certain irregularities have taken place in the management of respondent No.4, enquiry under Section 51 of the Andhra Pradesh Cooperative Societies Act, 1964 (for short ‘the Act’) was conducted by the Divisional Cooperative Officer, Rajahmundry. He submitted a report, dated 16.11.2007. On the basis of the same, the Deputy Registrar of Cooperative Societies Limited, respondent No.3 herein, initiated surcharge proceedings under Section 60 of the Act. Through his order, dated 05.12.2008, respondent No.3 held that the petitioner is also liable along with certain others for misappropriation of Rs.24,80,233/-. The petitioner challenges the said order. The principal contention urged by the petitioner is that he was not issued any show cause notice in the surcharge proceedings and the liability was fastened upon him without giving any opportunity. It is also stated that there was no finding against him in the enquiry report. On behalf of respondent Nos.2 and 3, a counter-affidavit is filed. Though it is mentioned that notices were issued to the petitioner, no particulars thereof are mentioned. Heard the learned counsel for the petitioner, the learned Government Pleader for Cooperation for respondents 1 to 3 and the learned counsel for respondent Nos.4 and 5. In the inspection conducted by the Divisional Cooperative Officer, Rajahmundry into the allegations of misappropriation of funds by the staff of respondent No.4-Society, he recorded certain findings. The report, in turn, became the basis for initiation of surcharge proceedings under Section 60 of the Act by respondent No.3. A detailed order, running into 24 pages, was passed by respondent No.3. A perusal of the same discloses that the notices under Section 61 of the Act were issued to Sri Sathi Veer Reddy, Sri M.Subrahmanya Sarma and Sri B.Dhana Raju. It is well settled that irrespective of the observations or findings in the report of audit, inspection or enquiry under the provisions of the Act, the liability can be fastened against an employee or an elected representative of the society under Section 60 of the Act, on the basis of the independent enquiry and evidence. Even where specific findings are recorded in the enquiry, inspection and audit, they cannot constitute the ground for fastening the liability under Section 60 of the Act, unless they are supported by independent evidence. Respondent No.3 has chosen to proceed only against three persons named above. No notice was issued to the petitioner. It is only at the end of his discussion that he recorded a finding to the effect that the petitioner, who was functioning as a Cashier in Rayavaram Branch of the District Cooperative Central Bank Limited, played active role and gave a helping hand to the three persons referred to above. On that basis, he held that the petitioner is also liable along with the three individuals. The findings recorded against the petitioner cannot be sustained in law. He was not issued any notice requiring him to explain his role, much less he was given an opportunity of being heard in such proceedings. Hence, the writ petition is allowed and the surcharge proceedings insofar as it relates to the petitioner are set aside. This order, however, shall not preclude the respondents from proceeding against the petitioner in accordance with law, if there exists sufficient material. There shall be no order as to costs. ______________________ L.NARASIMHA REDDY,J Dt: 20.04.2010. kdl