IN THE HIGH COURT OF JUDICATURE AT MADRAS Dated : 29..08..2008 C O R A M The Honourable Mr. A.K. Ganguly, Chief Justice and The Honourable Mr. Justice F.M. Ibrahim Kalifulla Writ Appeal No.949 of 2008 S.V.K. Sahasranamam .. Appellant versus 1. The Deputy Registrar of Co-op. Societies, Tiruvannamalai Circle, Tiruvannamalai, Tiruvannamalai District. 2. The Inspector of Police, CCIW CID, Tiruvannamalai, Tiruvannamalai District. 3. The Enquiry Officer, Arudurapattu Primay Agricultural Coop. Bank, Arudurapattu, Tiruvannamalai Taluk & District. .. Respondents - - - - - Prayer : Writ Appeal under Clause 15 of the Letters Patent against the order of a learned single Judge of this Court dated 25.6.2008 made in W.P. No.20310 of 2007 presented under Article 226 of the constitution of India to issue a Writ of certiorari calling for the entire records relating to the impugned order passed by the 3rd respondent in his proceedings No.Nil dated 23.11.2000 and quash the same in so far as the petitioner's concerned. - - - - - For Appellant : Mr. C. Prakasam For Respondents : Mr. J. Raja Kalifulla, Govt. Pleader - - - - - J U D G M E N T ( Delivered by The Honourable the Chief Justice ) Heard the learned counsel for parties. https://hcservices.ecourts.gov.in/hcservices/ 2. This writ appeal has been filed challenging the order of a learned Judge of the writ court dated 25.6.2008 by which the learned Judge declined to quash a report dated 23.11.2000 submitted by an Enquiry Officer after conducting an enquiry under Section 81 of the Tamil Nadu Co-operative Societies Act, 1983 (hereinafter referred to as 'the said Act') in respect of the concerned Co-operative Society. 3. The writ petitioner, who is the appellant before us, was working as a Co-operative Sub Registrar (Prosecution) at the Office of the Deputy Registrar of Co-operative Socieites, Ponneri Circle, Ponneri, Tiruvallur District. It is the case of the appellant that he was working as a Special Officer in the Arudarupattu Primary Agricultural Co-operative Bank in Tiruvannamalai Taluk and District at the time when the enquiry was directed against him under Section 81 of the said Act. After completion of the enquiry and submission of the enquiry report on 23.11.2000, surcharge proceedings have been initiated under Section 87 of the said Act and criminal proceedings have also been initiated against the appellant. The writ petition was filed challenging the said enquiry report, inter alia, on the ground that the enquiry report was submitted beyond the period prescribed therefor under Section 81(4) of the said Act. 4. Section 81 of the said Act provides for holding of enquiry by the Registrar of Co-operative Societies, of his own motion, on the application of a majority of the board or of not less than one-third of the members or on the request of the financing bank or of the District Collector. In the instant case, the Registrar started the enquiry on his own motion. Sub-section (4) of Section 81 provides as follows : "The inquiry shall be completed within a period of three months from the date of ordering the inquiry or such further period or periods not exceeding three months at a time as the next higher authority may permit, provided that such extended periods shall not exceed six months in the aggregate." In the instant case, the enquiry was initiated on 10.11.1999 and the report was submitted by the Enquiry Officer on 23.11.2000. The learned Judge of the writ court refused to set aside the enquiry proceedings by relying upon two judgments of the Supreme Court in the case of State of U.P. vs. Babu Ram Upadhya reported in A.I.R. 1961 S.C. 751 and in the case of State of U.P. vs. Manbodhan Lal reported in A.I.R. 1957 S.C. 912. 5. Therefore, the question which is falling for consideration before this Court is, whether the time limit which is provided under Section 81(4) of the said Act is mandatory or not and whether the https://hcservices.ecourts.gov.in/hcservices/ word "shall" used in Section 81(4) of the said Act has to be construed as mandatory or not. 6. It is well settled that the question whether an expression used in a section is mandatory or not has to be decided on various factors and the mere expression of the word "shall" alone is not decisive of the matter. This question came up for consideration before the Privy Council in the celebrated case of Montreal Street Railway Company vs. Normandin reported in A.I.R. 1917 Privy Council 142. Sir Arthur Channel, speaking for the Judicial Committee of the Privy Council, clarified the position at page 144 of the report as follows :- "The question whether provisions in a statute are directory or imperative has very frequently arisen in this country, but it has been said that no general rule can be laid down, and that in every case the object of the statutes must be looked at." The learned Judge relied on Maxwell on "The Interpretation of Statutes" and the portion on which reliance was placed is set out hereinbelow :- "where the prescription of a statute relate to the performance of a public duty and where the invalidation of acts done in neglect of them would work serious general inconvenience or injustice to persons who have no control over those entrusted with the duty without promoting the essential aims of the legislature, such prescriptions seem to be generally understood as mere instructions for the guidance and government of those on whom the duty is imposed, or, in other words, as directory only. The neglect of them may be penal, indeed, but it does not affect the validity of the act done in disregard of them." The aforesaid principles have been followed by the Constitution Bench of the Supreme Court in the case of State of U.P. vs. Manbodhan Lal (supra), wherein paragraphs 10 and 11 at pages 917 and 918 of the report are relevant and they are extracted hereunder :- "The question may be looked at from another point of view. Does the Constitution provide for the contingency as to what is to happen in the event of non-compliance with the requirements of Article 320(3)(c)? It does not, either in express terms or by implication, provide that the result of such a non-compliance is to invalidate the proceedings ending with the final order of the Government. https://hcservices.ecourts.gov.in/hcservices/ This aspect of the relevant provisions of Part XIV of the Constitution, has a direct bearing on the question whether Article 320 is mandatory. The question whether a certain provision in a statute imposing a duty on a public body or authority was mandatory or only directory, arose before their Lordships of the Judicial Committee of the Privy Council in the case of Montreal Street Railway Company v. Normandin, 1917 A.C. 170(B). In that case the question mooted was whether the omission to revise the jury lists as directed by the statute, had the effect of nullifying the verdict given by a jury. Their Lordships held that the irregularities in the due revision of the jury lists, will not ipso facto avoid the verdict of a jury. The Board made the following observations in the course of their judgment: “...The question whether provisions in a statute are directory or imperative has very frequently arisen in this country, but it has been said that no general rule can be laid down, and that in every case the object of the statute must be looked at. The cases on the subject will be found collected in Maxwell on Statutes, 5th Edn., p. 596 and following pages. When the provisions of a statute relate to the performance of a public duty and the case is such that to hold null and void acts done in neglect of this duty would work serious general inconvenience, or injustice to persons who have no control over those entrusted with the duty, and at the same time would not promote the main object of the legislature, it has been the practice to hold such provisions to be directory only, the neglect of them, though punishable, not affecting the validity of the acts done.” The principle laid down in this case was adopted be the Federal Court in the case of Biswanath Khemka v. King- Emperor, 1945 F.C.R. 99 : A.I.R. 1945 FC 76 (C). In that case, the Federal Court had to consider the effect of non- compliance with the provisions of Section 256 of the Government of India Act, 1935, requiring consultation between public authorities before the conferment of magisterial powers or of enhanced magisterial powers, etc. The Court repelled the contention that the provisions of Section 256, aforesaid, were mandatory. It was further held that non-compliance with that section would not render the appointment otherwise regularly and validly made, invalid or inoperative. That decision is particularly important as the words of the section then before their https://hcservices.ecourts.gov.in/hcservices/ Lordships of the Federal Court, were very emphatic and of a prohibitory character. An examination of the terms of Article 320 shows that the word “shall” appears in almost every paragraph and every clause or sub-clause of that article. If it were held that the provisions of Article 320(3)(c) are mandatory in terms, the other clauses or sub-clauses of that article, will have to be equally held to be mandatory. If they are so held, any appointments made to the public services of the Union or a State, without observing strictly, the terms of these sub-clauses in clause (3) of Article 320, would adversely affect the person so appointed to a public service, without any fault on his part and without his having any say in the matter. This result could not have been contemplated by the makers of the Constitution. Hence, the use of the word “shall” in a statute, though generally taken in a mandatory sense, does not necessarily mean that in every case it shall have that effect, that is to say, that unless the words of the statute are punctiliously followed, the proceeding or the outcome of the proceeding, would be invalid. On the other hand, it is not always correct to say that where the word “may” has been used, the statute is only permissive or directory in the sense that non- compliance with those provisions will not render the proceeding invalid. In that connection, the following quotation from Crawford on Statutory Construction — Article 261 at p. 516, is pertinent: “The question as to whether a statute is mandatory or directory depends upon the intent of the legislature and not upon the language in which the intent is clothed. The meaning and intention of the legislature must govern, and these are to be ascertained, not only from the phraseology of the provision, but also by considering its nature, its design, and the consequences which would follow from construing it the one way or the other....” The very same passage from the judgment of the Privy Council referred to above has been approvingly quoted by the Supreme Court in extenso. Similar principles have been reiterated in a subsequent Constitution Bench judgment of the Supreme Court in the case of State of U.P. vs. Babu Ram Upadhya (supra). Justice K. Subba Rao, as His Lordship then was, speaking for the majority, quoting the same passage from https://hcservices.ecourts.gov.in/hcservices/ Montreal Street Railway Company (supra), has come to the same conclusion [See page 765] :- "The relevant rules of interpretation may be briefly stated thus: When a statute uses the word “shall”, prima facie, it is mandatory, but the Court may ascertain the real intention of the legislature by carefully attending to the whole scope of the statute. For ascertaining the real intention of the Legislature the Court may consider, inter alia, the nature and the design of the statute, and the consequences which would follow from construing it the one way or the other, the impact of other provisions whereby the necessity of complying with the provisions in question is avoided, the circumstance, namely, that the statute provides for a contingency of the non-compliance with the provisions, the fact that the non-compliance with the provisions is or is not visited by some penalty, the serious or trivial consequences that flow therefrom, and, above all, whether the object of the legislation will be defeated or furthered." The decision of the Supreme Court in State of U.P. vs. Manbodhan Lal (supra) was also reiterated. 7. In our view, the learned Judge of the writ court, therefore, placed reliance on the correct proposition of law and the judgment of the Apex Court and the formulation of the principles of the Privy Council. Subsequently also, in a two judge bench decision of the Supreme Court in the case of T.V. Usman vs. Food Inspector, Tellicherry Municipality reported in A.I.R. 1994 S.C. 1818, the same principles have been reiterated [See paragraph 14]:- "In Maxwell on Interpretation of Statutes, Eleventh Edn., at page 362 it is stated as under: “Where, indeed, the whole aim and object of the legislature would be plainly defeated if the command to do the thing in a particular manner did not imply a prohibition to do it in any other manner, no doubt can be entertained as to the intention; that is to say, such a requirement would be imperative.” It is further stated on page 364 that: “The general rule is, that an absolute enactment must be obeyed or fulfilled exactly, but it is sufficient if a directory enactment be obeyed or fulfilled substantially. https://hcservices.ecourts.gov.in/hcservices/ * * * When a public duty is imposed and the statute requires that it shall be performed in a certain manner, or within a certain time, or under other specified conditions, such prescriptions may well be regarded as intended to be directory only in cases when injustice or inconvenience to others who have no control over those exercising the duty would result if such requirements were essential and imperative.” In Craies’ Statute Law, Seventh Edn., at page 62 it is stated thus: “When a statute is passed for the purpose of enabling something to be done, and prescribes the formalities which are to attend its performance, those prescribed formalities which are essential to the validity of the thing when done are called imperative or absolute; but those which are not essential and may be disregarded without invalidating the thing to be done, are called directory.” (emphasis in original) At page 250 it is further stated thus: “The question whether the provisions in a statute are directory or imperative has frequently arisen in this country, but it has been said that no general rule can be laid down and that in every case the object of the statute must be looked at. ... When the provisions of a statute relate to the performance of a public duty and the case is such that to hold null and void acts done in respect of this duty would work serious general inconvenience or injustice to persons who have no control over those entrusted with the duty, and at the same time would not promote the main object of the legislature, it has been the practice to hold such provisions to be directory only, the neglect of them, though punishable not affecting the validity of acts done.” In Dattatraya Moreshwar v. State of Bombay, A.I.R. 1952 S.C. 181, it was held as under: “Generally speaking the provisions of a statute creating public duties are directory and those conferring private rights are imperative. When the provisions of a statute relate to the performance of a public duty and the case is such that to hold null and void acts done in neglect of this duty would work serious general inconvenience or injustice to persons who have no control over those entrusted with the duty and at the same time would not promote the main object of the legislature, it has been the practice of the Courts to hold such provisions to be directory only, the neglect of them not affecting the validity of the acts done.” https://hcservices.ecourts.gov.in/hcservices/ In Rule 7(3) no doubt the expression “shall” is used but it must be borne in mind that the rule deals with stages prior to launching the prosecution and it is also clear that by the date of receipt of the report of the Public Analyst the case is not yet instituted in the court and it is only on the basis of this report of the Public Analyst that the authority concerned has to take a decision whether to institute a prosecution or not. There is no time-limit prescribed within which the prosecution has to be instituted and when there is no such limit prescribed then there is no valid reason for holding the period of 45 days as mandatory. Of course that does not mean that the Public Analyst can ignore the time-limit prescribed under the rules. He must in all cases try to comply with the time-limit. But if there is some delay, in a given case, there is no reason to hold that the very report is void and on that basis to hold that even prosecution cannot be launched. May be, in a given case, if there is inordinate delay, the court may not attach any value to the report but merely because the time-limit is prescribed, it cannot be said that even a slight delay would render the report void or inadmissible in law. In this context it must be noted that Rule 7(3) is only a procedural provision meant to speed up the process of investigation on the basis of which the prosecution has to be launched. No doubt, sub-section (2) of Section 13 of the Act confers valuable right on the accused under which provision the accused can make an application to the court within a period of 10 days from the receipt of copy of the report of Public Analyst to get the samples of food analysed in the Central Food Laboratory and in case the sample is found by the said Central Food Laboratory unfit for analysis due to decomposition by passage of time or for any other reason attributable to the lapses on the side of prosecution, that valuable right would stand denied. This would constitute prejudice to the accused entitling him to acquittal but mere delay as such will not per se be fatal to the prosecution case even in cases where the sample continues to remain fit for analysis in spite of the delay because the accused is in no way prejudiced on the merits of the case in respect of such delay. Therefore it must be shown that the delay has led to the denial of right conferred under Section 13(2) and that depends on the facts of each case and violation of the time-limit given in sub-rule (3) of Rule 7 by itself cannot be a ground for the prosecution case being thrown out." 8. The learned counsel for the appellant, however, relied on a recent judgment of the Supreme Court in the case of Vidya Vikas Mandal vs. Education Officer reported in (2008) 1 S.C.C. (L&S) 759. https://hcservices.ecourts.gov.in/hcservices/ In that case, the learned Judges of the Supreme Court came to a finding that submission of enquiry report beyond the time limit prescribed therefor was not sustainable. This Court is of the opinion that the consideration in a departmental enquiry is totally different from the consideration which weighs with the Court in another enquiry which is of a public nature and which in the nature of a fact finding enquiry in order to find out whether the affairs of a co-operative society are conducted properly or they are conducted in an illegal manner by way of indulging in corruption, resulting in erosion of public funds. Therefore, the judgment of the Supreme Court given in a different fact situation in the case of Vidya Vikas Mandal (supra) cannot be pressed into service in the facts of the present case. 9. It is nobody's case that in the instant case, the proceeding under Section 81 of the said Act amounts to an enquiry which can be called a departmental or disciplinary enquiry. It cannot be disputed that an enquiry under Section 81 of the said Act is an enquiry in public interest in order to find out whether the affairs of a co- operative society are conducted legally and whether there are financial improprieties in the matter of conduct of its affairs. Such an enquiry cannot be prima facie compared to an enquiry against any individual employee. It is obviously true that as a follow up action on such enquiry under Section 81, various other steps may be taken, viz. surcharge proceedings can be initiated under Section 87 and steps can be also taken for initiating criminal proceedings. In the instant case, both these steps have been taken. 10. Before the learned Judge of the writ court, the appellant relied on two learned single Bench judgments of this Court rendered in the case of T.V. Ekambaram vs. The Co- operative Tribunal-cum-District Judge, Madurai reported in 2000 (2) C.T.C. 659 and in the case of Gabriel vs. The Deputy Registrar (Housing), Cuddalore reported in 2003 (3) C.T.C. 23. In both these two judgments, the provisions of Section 87 of the said Act which relate to surcharge proceedings were examined and the learned Judges in both the aforesaid judgments construed the following proviso to Section 87 : "Provided further that the action commenced under this sub-section shall be completed within a period of six months from the date of such commencement or such further period or periods as the next higher authority may permit but such extended period or periods shall not exceed six months in the aggregate." Considering the said time limit of six months, the learned Judges came to the conclusion that the said period of six months is mandatory. https://hcservices.ecourts.gov.in/hcservices/ 11. We are constrained to hold that even though no appeal has been taken to us from the said judgments, yet having regard to the well settled legal position which has been referred to hereinabove, the finding of the learned Judges in these two judgments that the period of six months in the second proviso to Section 87 of the said Act is mandatory is not a correct finding in law. We find that even though before the learned Judge of the writ court those two judgments of the learned single Bench were cited, the learned Judge of the writ court was not swayed by those two decisions and came to a correct finding, relying upon the well settled proposition laid down by the Supreme Court as pointed above hereinabove. 12. We, therefore, affirm the order of the learned single Judge in this case. We are of the view that in a case where there are allegations of embezzlement and misappropriation of public funds, the members of general public who have been cheated have no control over those who hold the enquiry in respect of the time limit. To hold that such an enquiry which has been continued beyond the time limit is bad would cause great injustice. 13. Therefore, if such enquiry is continued beyond the time limit mentioned in the relevant statute, the said time cannot be held to be mandatory in view of the principles laid down in Montreal Street Railway Company (supra), which has been affirmed by the Supreme Court. 14. The writ appeal is thus dismissed. There shall be no order as to costs. Consequently, M.P. No.1 of 2008 is closed. Sd/- Asst. Registrar. /true copy/ Sub Asst. Registrar. ab/pv To 1. The Deputy Registrar of Co-op. Societies, Tiruvannamalai Circle, Tiruvannamalai, Tiruvannamalai District. 2. The Inspector of Police, CCIW CID, Tiruvannamalai, Tiruvannamalai District. https://hcservices.ecourts.gov.in/hcservices/ 3. The Enquiry Officer, Arudurapattu Primay Agricultural Coop. Bank, Arudurapattu, Tiruvannamalai Taluk & District. + 1 CC to the Government Pleader SR NO 49219 + 1 CC To Mr.C.Prakasam, Advocate SR NO.49361 Writ Appeal No.949 of 2008 MRD(CO) SRA(22/09/2008) https://hcservices.ecourts.gov.in/hcservices/