IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. C.W.P. No. 7114 of 2007 DATE OF DECISION : 05.11.2008 Subhash Chander .... PETITIONER Versus State of Punjab and others ..... RESPONDENTS CORAM :- HON'BLE MR. JUSTICE SATISH KUMAR MITTAL HON'BLE MR. JUSTICE JASWANT SINGH Present: Mr. R.K. Sharma, Advocate, for the petitioner. Mr. N.D.S. Mann, Addl. A.G., Punjab, for respondents No.1 to 3. Mr. Arun Kumar Singal, Advocate, for respondent No.4. Mr. A.K. Jaiswal, Advocate, for respondents No.6 to 12 and 14. * * * SATISH KUMAR MITTAL , J. Petitioner Subhash Chander has filed this petition under Articles 226/227 of the Constitution of India for quashing the order dated 5.3.2004 (Annexure P-6) passed by the Additional Registrar (G), Cooperative Societies, Punjab (respondent No.2 herein); order dated 31.7.2006 (Annexure P-7), passed by the Financial Commissioner, Cooperation, Punjab, whereby the revision filed by the petitioner against the aforesaid order has been dismissed, as well as the order dated 4.12.2006 (Annexure P-10), whereby the application of the petitioner to re-consider CWP No. 7114 of 2007 -2- the aforesaid order dated 4.12.2006 has been dismissed by the Financial Commissioner, Cooperation, Punjab. The brief facts of the case are that at one point of time, the petitioner was working as a Salesman in the Rail Majra Cooperative Agricultural Service Society Ltd., Rail Majra, Tehsil Balachaur, District Nawanshahar – respondent No.4 (hereinafter referred to as `the respondent Society'). Subsequently, he became the Secretary of the respondent Society. In the year 1995, vide resolution dated 15.6.1995, the respondent Society prepared an arbitration case for recovery of Rs. 91,095.07 against Shri Jalsu Ram, its Ex-Secretary, and some loanee members. Subsequently, vide another resolution dated 6.11.1995, the respondent Society prepared the arbitration case with regard to an amount of Rs. 33,352/- against aforesaid Jalsu Ram, relating to the share money received by him from the members, but not deposited in the bank. Further, vide resolution dated 6.6.1996, the third arbitration case was prepared against said Jalsu Ram for recovery of an amount of Rs. 1,90,000/- on the basis of the audit report of the year 1994- 95, which was shown as outstanding against him. When those arbitration cases were pending, a complaint was made against the petitioner, to the Deputy Registrar, Cooperative Societies, Nawanshahar, on which he got an enquiry conducted with respect to embezzlement of the funds of the respondent Society. In that enquiry, the petitioner was found guilty of the charge. In the meanwhile, the Administrator also requested the Deputy Registrar, who had appointed the Administrator, to allow the impleading of CWP No. 7114 of 2007 -3- the petitioner as respondent in the arbitration case to meet the ends of justice. Accordingly, the Deputy Registrar, vide his order dated 12.8.2002, ordered for impleading the petitioner as party. Then, the Administrator of the respondent Society, exercising the powers of the Managing Committee of the respondent Society, passed the resolution on 18.11.2002, impleading the petitioner as party in the arbitration case, pending before the Assistant Registrar, Cooperative Societies. Against the abovesaid resolution dated 18.11.2002, the petitioner filed a revision before the Registrar, Cooperative Societies, who entrusted the case to the Joint Registrar, Cooperative Societies (respondent No.3 herein). The Joint Registrar, vide his order dated 21.5.2003 set aside the resolution dated 18.11.2002, passed by the Administrator of the respondent Society on the ground that at the relevant time i.e. from 1.4.1994 to 1.3.1995, the period for which the irregularities were pointed out by the audit report, the petitioner was not in service of the respondent Society. Against the said order, Amrik Singh (deceased husband of respondent No.6 herein) and respondents No.7 to 14 herein filed a revision on the ground that the petitioner, by concealing the material facts from the Court, had got the resolution dated 18.11.2002 set aside. Respondent No.2, vide his order dated 5.3.2004, set aside the aforesaid order dated 21.5.2003, while observing as under :- “... It would be appropriate to implead Sh. Subhash Chander as a necessary party in the Arbitration case prepared by the society CWP No. 7114 of 2007 -4- so that Arbitrator could finalize the matter after giving opportunity of hearing to all the concerned with the affairs of the society including Sh. Subhash Chander who were not connected with the affairs of the society at a time when embezzlement of the funds of the society had taken place. It is also mentioned here that impleading Sh. Subhash Chander as a party in the arbitration reference does not mean that the responsibility of financial lapses in the society has been fastened on him. The arbitrator decides the case on the merit giving the reasoning and identify the relevant persons responsible for financial lapse in the society. Therefore, in the interest of justice it would not be inappropriate to implead Sh. Subhash Chander as a party who if not found guilty of any lapses may be proved innocent. Therefore, the decision given by the Joint Registrar Cooperative Societies (Farming) dated 21.5.2003 is set aside.” Against the said order, the petitioner filed revision petition before the Government and the same was dismissed by the Financial Commissioner, Cooperation, Punjab, vide order dated 31.7.2006. Against the said order, the petitioner filed Civil Writ Petition No. 15416 of 2006, which was disposed of by this Court, with a direction to the petitioner to make necessary application before the Financial Commissioner for re- considering the matter on all the points, raised by him. In pursuance of the said direction, the petitioner was again heard by the Financial Commissioner, Cooperation, Punjab, and the said application was dismissed, while observing as under :- “I have considered the arguments given by the counsel CWP No. 7114 of 2007 -5- and have gone through the record of the case. I find that the impugned order dated 5.3.2004 of the Additional Registrar is under the provisions of the Punjab Cooperative Societies Act, 1961 and no illegality on the count can be found with this order of the Additional Registrar. In fact, in the order dated 5.3.2004 no adverse findings regarding the embezzlement has been made against the petitioner. The order only says that the petitioner be impleaded as a necessary party in the arbitration case and the Arbitrator should finalize the matter by giving opportunity of hearing to all concerned persons including the petitioner. I do not understand as to how the petitioner is aggrieved by this order of the Additional Registrar. The petitioner should present his case before the Arbitrator. The Arbitrator will go through the merits of the case and fix responsibility where it lies. The contention of the petitioner that certain documents have been taken into account by the Additional Registrar in his order dated 5.3.2004 is pre mature at this stage as no findings on the same have been given. In fact, the entire case is open for adjudication before the Arbitrator. Accordingly, I find no merit in the application and the same is dismissed.” Hence, the petitioner has filed this petition. We have heard learned counsel for the parties and perused the impugned orders. During the course of hearing, it has not been disputed by learned counsel for the petitioner that the Administrator of the respondent Society was having the power to pass the resolution in question for impleading the petitioner as a party in the arbitration reference. Learned counsel for the petitioner contends that the respondent CWP No. 7114 of 2007 -6- Society, vide resolution dated 18.11.2002, had wrongly ordered for impleading of the petitioner as party in the arbitration references, particularly when the petitioner was not working as Secretary at the relevant time. He further contends that respondent No.2, vide order dated 5.3.2004, has illegally set aside the order dated 21.5.2003, passed by respondent No.3, without having any jurisdiction. He has further pointed out that during the course of hearing, respondent No.2 has wrongly relied upon the documents, produced by the respondent Society. Therefore, the impugned order is liable to be set aside. After hearing counsel for the parties, we do not find any merit in the instant petition. It is undisputed position that though at the relevant time, the petitioner was not working as a Secretary, but at that time, he was working as a Salesman in the respondent Society and subsequently, he became Secretary of the respondent Society. It is also undisputed position that during the course of hearing before respondent No.2, a document was produced, in which the petitioner himself had given in writing that he had recovered an amount of Rs. 85,100/- from 12 loanee members and had used this amount for his personal work, after making entries in the Cash Book of the respondent Society in the year 1994-95. In these facts and circumstances, respondent No.2 has rightly held that the petitioner was necessary party in the arbitration cases and no prejudice will be caused to any body, if he is impleaded as a party. In the said order, it has been specifically mentioned that by impleading the petitioner as a party in the CWP No. 7114 of 2007 -7- arbitration reference, he will not be deemed to be responsible for financial lapses in the respondent Society. The Arbitrator will decide all these issues, after giving full opportunity to all the parties. It has been further held that the Additional Registrar has the power under the Punjab Cooperative Societies Act, 1961 (hereinafter referred to as `the Act'), to set aside the order of the Joint Registrar, therefore, respondent No.2 has rightly set aside the order dated 21.5.2003, passed by respondent No.3, while upholding the resolution dated 18.11.2002. Therefore, in our opinion, the resolution of the respondent Society to implead the petitioner as a party in the arbitration case, which has been upheld by the authorities under the Act, does not require any interference, particularly when it has already been mentioned in the impugned order that by impleading the petitioner, it will not be taken that he was guilty of embezzling the disputed amount. The issue as to who is responsible will be decided by the Arbitrator after providing full opportunity of hearing to all the parties. In view of the above, we do not find any ground to interfere in the impugned order, in exercise of the writ jurisdiction of this Court under Article 226 of the Constitution of India. Dismissed. ( SATISH KUMAR MITTAL ) JUDGE November 05, 2008 ( JASWANT SINGH ) ndj JUDGE