Full Judgment Text
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PETITIONER:
YOGENDRA PRASAD
Vs.
RESPONDENT:
ADDL. REGISTRAR, CO-OP. SOCIETIES, BIHAR AND ORS.
DATE OF JUDGMENT17/09/1991
BENCH:
PUNCHHI, M.M.
BENCH:
PUNCHHI, M.M.
RAMASWAMY, K.
CITATION:
1991 AIR 2137 1991 SCR Supl. (1) 143
1992 SCC Supl. (1) 720
ACT:
Bihar and Orissa Cooperative Societies Act, 1935--Sec-
tions 48 (6), 56 - Legislative intention--Revisionary powers
of Registrar--Construction, nature and ambit of.
Bihar and Orissa Cooperative Societies Act, 1935--Sec-
tions 40, 48--Initiation of proceeding u/s. 40 prior to
proceeding u/s. 48--Whether amounts to double jeopardy.
Bihar and Orissa Cooperative Societies Act, 1935--Sec-
tions 2(1),2(a),6,26,56--"Registrar"--Construction---Whether
assistants of Registrar eligible to exercise powers of
Registrar.
HEADNOTE:
The appellant, an Ex-Treasurer of a Co-operative Society
was said to have defalcated a sum of Rs. 95,790.54 and for
recovery thereof, proceedings were initiated under section
48 of the Bihar and Orissa Co-operative Societies Act, 1935
with interest accrued thereon of Rs. 25,55 as on December
30, 1976.
The Registrar referred the matter to the Asstt. Regis-
trar who on enquiry and having given the opportunity to the
appellant passed an award, against which appeal was filed.
The Deputy Registrar allowed the appeal on the ground
that the appellant was surcharged.
On revision, the first respondent set aside the appel-
late order and confirmed the award with a further direction
to pay interest till date of recovery.
The appellant filed a writ petition which was dismissed
in limine by the High Court against which this appeal by
special leave.
The appellant contended that the Registrar had no revi-
sional
144
jurisdiction under Section 56 since the award of the Asstt.
Registrar was by the Registrar under the Act acting as
Registrar’s delegate; that surcharge proceedings against the
appellant were initiated under Section 40 in which the
appellant was found payable of partial amount, as against
which, the society filed an appeal before the Government,
which was pending and the award amounted to double jeopardy
for the same liability and therefore, it was illegal.
Dismissing the appeal, this Court,
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HELD: 1. A bare reading of the relevant provisions in
Section 48 clearly manifests the legislative intention that
the Registrar on reference, himself may decide the dispute
or transfer it for disposal to a person exercising powers of
the Registrar in this behalf. If the Registrar himself
decides the dispute under Section 48(3) the question of
either appeal or revision to him does not arise except a
review. This dichotomy is to be maintained when a revisional
power is to be exercised by the Registrar. The power of
revision is conferred expressly only, either on application
or suo moto, against any order passed by "a person exercis-
ing the powers of the Registrar". Obviously it refers to the
person appointed to assist him under s. 6(2) (a) of the Act.
[148G-H, 149 A]
2. The Registrar under s. 6(1) of the Act has his pre-
eminent supervisory authority over the function and orders
of the Registrars appointed under s. 6(2)(a) to assist him
in the discharge of the duties or functions under the Act
except over his delegate under sub-section (4) of s. 6. His
supervisory or revisional power is to correct all palpable
material errors in the orders passed or the action taken by
the subordinate officers feeding injustice. Merely because
the Asstt. Registrar on reference exercised the powers under
sub,section (3) of s. 48. The Registrar is not denuded of
his supervisory or revisional powers under s. 56 of the Act.
Therefore, the Addl. Registrar as delegate of the Registrar
is clearly within his power to exercise his revisional power
over the appellate order under S. 48(6) of the Act. It is
accordingly legal and valid. [149 E-G]
3. The language in s. 56 was couched very widely without
being hedged with any limitation like the revisional powers
under s. 115 C.P.C. or the similar language used in sister
Acts in some other States. The reason appears to be obvious.
The order of the Dy. Registrar by language
145
of sub-section (6) ors. 48, undoubtedly shall be final. When
the legislature gives ’finality’ to an order, it is normally
not open to revision. But still it must be construed in the
light of the scheme of the Act, its operation and resultant
effect. The language in s. 56 is not hedged with any limita-
tion of the finality in sub-section (6) of Section 48. The
revisional power under section 56 is independent of the
appellate powers under section 48(6). The latter is amenable
to revision by the Registrar. [150 D-F]
4. The proceedings under s. 40 are not in substitution
of s. 48, but are independent of and in addition to the
normal civil remedy under s. 48. The culpable negligence,
misconduct, misappropriation, fraudulent conduct etc. are
relevant facts to be established in the proceedings under
section 40. But that is not so under section 48. Therefore,
mere initiation or an order passed under s. 40 does not
divest the jurisdiction or power of the Registrar under s.
48 when it was referred to for a decision of the dispute.
Exercise of the jurisdiction to pass an award under s. 48(3)
or revision under s. 56 does not amount to double jeopardy.
[151 C-D]
5. Section 2(i) of the Act defines "Registrar", which
means a person appointed to perform the duties of Registrar
or Co-operative Societies under this Act. The State Govern-
ment may appoint a person to be the Registrar of the Co-
operative Societies besides Additional Registrar and also
appoint persons to assist such Registrar. Under sub-section
2(a) the persons appointed to assist the Registrar are
entitled to exercise all or any of the powers of the Regis-
trar under the Act except under s. 26. Sub-section (4) of
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Section 6 gives power to the Registrar to delegate, transfer
or assign to the Addl. Registrar all the powers including
the powers under s. 26 and 56 and thereupon the Addl. Regis-
trar as a delegate of the Registrar is empowered to exercise
powers so transferred or assigned or delegated to him.
Section 6 thereby makes a clear distinction between the
exercise of the powers of the Registrar, by the Addl. Regis-
trar as a delegate of the Registrar and of the Asstt.
Registrars or Dy. Registrars appointed to assist the Regis-
trar empowered as such in the discharge of their functions
under the Act. Such assistants are entitled by statutory
operation to exercise the powers under the Act conferred by
the State Govt. except to the extent expressly excluded by
the statute. [147 B, 148 A-B]
Din Dayal Singh v. The Bihar State Cooperative Marketing
Union Ltd.,
146
AIR 1976 Patna 179, over-ruled
Chintapalli Agency Taluk Arrack Sales Co-op. Society
Ltd. v. Secretary (Food & Agricultural), Govt. of Andhra
Pradesh, [1978] 1 SCR 563, followed.
Roop Chand v. State of Punjab, [1963] Suppl. 1 SCR 539,
distinguished.
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No.2168 of
1980.
From the Judgment and Order dated 2.8.1979 of the Patna
High Court in C.W.J.C. No.1819 of 1979.
R.K. Khanna and R.P. Singh for the Appellant.
L.C. Goyal for the Respondents.
The Judgment of the Court was delivered by
K. RAMASWAMY, J. The appellant, the Ex-Treasurer of the
Gopalganj Co-op. Development & Cane Marketing Union, Gopal-
ganj, was said to have defalcated a sum of Rs. 95,790.54 and
for recovery thereof, proceedings were initiated under s. 48
of the Bihar and Orissa Co-operative Societies Act, VI of
1935, for short ’the Act’ with interest accrued thereon of
Rs. 25,555 as on December 30, 1976. The Registrar referred
the matter to the Asstt. Registrar, Gopalganj, who on en-
quiry and having given the opportunity to the appellant
passed an award in Case No. 400 of 1975 on December 30, 1976
for the aforesaid sums. On appeal, the Deputy Registrar set
aside the award on the ground that the appellant was surch-
arged in Surcharge Case No. 18 of 1976. On further revision,
the first respondent set aside the appellate order and
confirmed the award with a further direction to pay interest
till date of recovery. The appellant filed C.W.J.C. No. 1819
of 1979 which was dismissed in limine by the Patna High
Court on August 2, 1979. Thus this appeal by Special Leave.
The learned counsel for the appellant raised two- fold
contentions. His first contention is that the Registrar has
no revisional jurisdiction under s. 56 since the award of
the Asstt. Registrar is by the Registrar under the Act and
the Asstt. Registrar acted as his delegate. In support
thereof he placed strong reliance on Din Dayal Singh v. The
Bihar State Cooperative Marketing Union Ltd, AIR 1976 Patna
179. It is further contended that surcharge proceedings
against the appellant were initiated under s. 40 in
147
which the appellant was found payable of partial amount as
against which the society filed an appeal before the Govern-
ment which is pending. The award amounts to double jeopardy
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for the same liability. Therefore, it is illegal. We find no
substance in either contention.
Section 2 (i) of the Act defines ’Registrar’, which
means a person appointed to perform the duties of Registrar
of Co-operative Societies under this Act. Section 6 in
Chapter II provides thus:
"6. The Registrar-- (1) The State Government
may appoint a person to be registrar of Co-
operative Societies for the State or any
portion of it, and may appoint persons to
assist such Registrar.
(2) The State Government may, by general or
special order published in the Official Ga-
zette, confer -
(a) on any person appointed under sub- section
(1), to assist the Registrar, all or any of
the powers of the Registrar under this Act
except the powers under Section 26; and
(b) on any Co-operative Federation or financ-
ing bank all or any of the powers of the
Registrar under Section 20, sub-section (3) of
Section 28 and Section 33.
(3) Where the State Government is of opinion
that the Registrar needs the assistance of
Additional Registrar for speedy disposal of
business, it may by order published in the
Official Gazette, appoint such number of
Additional Registrar as it may deem fit.
(4) Notwithstanding anything to the contrary
contained in any other provision of the Act,
the Registrar may delegate, transfer or assign
to the Additional Registrar such of his powers
and functions and duties as he may consider
necessary including the power under sections
26 and 56 and the Additional Registrar shall,
thereupon have powers of Registrar in matters
so delegated, transferred or assigned to him."
From a reading of sub-sections (1) to (3) of s. 6, it is
clear that the State Government may appoint a person to be
the Registrar of the Cooperative Societies besides Addition-
al Registrar and also appoint persons to assist such Regis-
trar. Under sub-section 2 (a) the persons appointed to
148
assist the Registrar are entitled to exercise all or any of
the powers of the Registrar under the Act except under s.
26. Sub-section (4) gives power to the Registrar to dele-
gate, transfer or assign to the Addl. Registrar all the
powers including the power under ss. 26 and 56 and thereupon
the Addl. Registrar as a delegate of the Registrar is empow-
ered to exercise powers so transferred or assigned or dele-
gated to him. Section 6 thereby makes a clear distinction
between the. exercise of the powers of the Registrar, by the
Addl. Registrars as a delegate of the Registrar and of the
Assn. Registrars or Dy. Registrars appointed to assist the
Registrar empowered as such in the discharge of their func-
tions under the Act. Such assistants are entitled by statu-
tory operation to exercise the powers under the Act con-
ferred by the State Govt. except to the extent expressly
excluded by the statute.
Section 48 provides procedure to adjudicate any dispute
touching the business of a registered Society other than a
dispute regarding disciplinary action taken by the Society
or its Managing Committee against a paid servant of the
society, arising amongst its members covered by clauses (a)
to (e) and (c) covering any officer, agent or servant of the
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society (past or present). Such disputes shall be referred
to the Registrar. Under sub-section (2) thereof the Regis-
trar may on receipt of such reference (a) decides the dis-
pute by himself or (b) transfer for disposal to "any person
exercising the powers of the Registrar in this behalf’...
Under sub-section (3) the Registrar (Assistant or Deputy) on
reference shall dispose of the same in th manner provided
and the rules. A right of appeal under s.48 (6) is provided
against the award made under sub-section (3). Sub-section
(9) provides the subject to the orders of the Registrar on
appeal or review a decision given in a dispute transferred
or referred under clauses (b) and (c) shall be final. Sec-
tion 56 provides power of revision thus:
Power of revision by Registrar - The Registrar
may on application or of his own motion revise
any order passed by a person exercising the
powers of a Registrar or by a liquidator under
s. 44"
A bare reading of these relevant provisions clearly
manifests the legislative intention that the Registrar on
reference, himself may decide the dispute or transfer it for
disposal to a person exercising powers of the Registrar in
this behalf. If the Registrar himself decides the dispute
under s. 48(3) the question of either appeal or revision to
him does not arise except a review. This dichotomy is to be
maintained when a revisional power is to be exercised by the
Registrar. The power of the revision is conferred expressly
only, either on application or suo moto, against any
149
order passed by "a person exercising the powers of the
Registrar". Obviously it refers to the person appointed to
assist him under s. 6(2)(a) of the Act.
In Chintapalli Agency Taluk Arrack Sales Co-op. Society
Ltd. v. Society (Food & Agriculture), Govt. of Andhra
Pradesh, [1978] 1 S C R 563 a similar question had arisen.
The Dy. Registrar of Co-operative Societies gave notice to
the appellant and amended under s. 16 (5) of the A.P. Co-
operative Societies Act, the Bye-laws of the Society so as
to restrict the area of operation within the specified area.
On a revision filed against the order under s. 77, the
Registrar gave certain directions which was assailed being
without jurisdiction. When it came before the High Court,
the High Court allowed the writ petition. On appeal this
court held that the power of the Registrar is in accordance
with the pre-eminent position accorded by the Act to the
Registrar under whose supervision any other person appointed
under s.3 (1) may function and act. "It is, therefore, not
correct that the Registrar could not exercise powers under
s. 77 in examining the correctness, legality or propriety of
the proceedings initiated by the Dy. Registrar under s.
16(5) of the Act". It was further held that the power under
s.16 is that of the Registrar, but the Dy. Registrar is
empowered by the Government to exercise the powers, but
under the general superintendence of the Registrar. Accord-
ingly it was held that the revision was maintainable. The
same ratio applies to the facts on hand. The Registrar under
s. 6 (1) of the Act has his pre-eminent supervisory authori-
ty over the functions and orders of the Registrars appointed
under s. 6(2) (a) to assist him in the discharge of the
duties or functions under the Act except over his delegate
under sub-section (4) of s. 6. His supervisory or revisional
power is to correct all palpable material errors in the
orders passed or the action taken by the subordinate offi-
cers feeding injustice. The language couched in s. 56 advis-
edly was wide of the mark to reach injustice whenever found
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in the orders or actions of his subordinate officers. Merely
because the Asstt. Registrar on reference exercised the
power under sub-s. (3) of s.48, the Registrar is not denuded
of his supervisory or revisional powers under s. 56 of the
Act. Therefore, the Addl. Registrar as delegate of the
Registrar is clearly within his power to exercise his revi-
sional power over the appellate order under s. 48 (6) of the
Act. It is accordingly legal and valid. The ratio in Roop
Chand v. State of Punjab, [1963] Suppl. 1 SCR 539 is clearly
distinguishable. Therein the State Govt. have expressly
delegated their power to the Asstt. Director. Thereby the
Subordinate Officer exercised the powers of the State Govt.
as their delegate. The Govt. was thereafter devoid of powers
to exercise the revisional powers over the subordinate
officers. This court in Chintapalli Agency’s case (supra)
distinguished Roop
150
Chand’s ratio. Din Dayal Singh’s case (supra) no doubt
supports the contention of the appellant. Relying upon the
language in sub-section (9) of s. 48 "save as expressly
provided in this section ", the Division Bench construed
that the appellate order of the Deputy Registrar passed
under s. 48 (6) was otherwise provided and so was not amena-
ble to revision under s. 56. The learned Judges construed
that since the appellate order shall be final. The effect of
language under sub-sec. (9) of s. 48 was to exclude the
revisional jurisdiction of the Registrar under s. 36. In
addition, the Division Bench also construed that the Regis-
trar himself referred the dispute to the Asstt. Registrar
and any person exercising the power of the Registrar in this
behalf is to be in the parameters of his delegate and that,
therefore, the Registrar himself cannot revise his own order
under s. 56. We find it difficult to approve the ratio of
the High Court. At the cost of repetition we point out that
s. 6, sub-section (1) and sub-section 2 (a) make a distinc-
tion between "the Registrar" and "a person exercising the
powers of the Registrar". Sub-section (4) further amplifies
the exercise of the power of the Registrar by the Additional
Registrar as his delegate. That apart, it is clear that the
Registrar is the final supervisory authority over the subor-
dinate officers exercising the powers or performing the
duties under the Act. The language in s. 56 was couched
very widely without being hedged with any limitation like
the revisional powers under s. 115 C.P.C. or the similar
language used in sister Acts in some other States like A.P.
The reason appears to be obvious. The order of the Dy.
Registrar by language of sub-section (6) of s. 48, undoubt-
edly shall be final. We are aware that when the legislature
gives "finality" to an order, it is normally not open to
revision. But still in must be construed in the light of the
scheme of the Act, its operation and resultant effect. The
language in s.56 is not hedged with any limitation of the
finality in sub-section (6) of s. 48. Thus we hold that the
revisional power under s. 56 is independent of the appellate
power under section 48(6). The letter is amenable to revi-
sion by the Registrar. The ratio of the Division Bench in
Din Dayal’s case (supra) is, therefore, not good law.
The second contention that the award of the Asstt.
Registrar amounts to double jeopardy offending his right
under Art. 20 is misconceived and without substance. Un-
doubtedly s. 40 gives power to the Registrar to initiate
surcharge proceedings, on receipt of audit report under s.
33 or an enquiry under s. 35 or on inspection under Ss. 34,
36 or 37 or of the winding up proceedings, if it appears to
the Registrar that any person who has taken part in the
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organisation or the management of the society or any past or
present officers of the society made any illegal payment
under clause (a); or by reason of his culpable negligence or
mis-
151
conduct causes loss or deficiency to the funds of the socie-
ty under clause (b); or failed to bring into account any
sums which ought to have been brought into the account under
clause (d); or misappropriated or fraudulently retained any
property of the society or of the financing bank etc. The
proceedings under s. ,18 are in the nature of a civil suit,
otherwise cognisable by a civil court under s. 9 of the
C.P.C. The statute has taken out the jurisdication of the
civil court and expressly conferred on the Registrar or a
person exercising the powers of the Registrar to decide the
dispute touching the business or management of the society
between its members, past members etc. or their office
bearers, agent or officers or servants of the society etc.
The proceedings under s. 40 are not in substitution of s.
48, but are independent of and in addition to the normal
civil remedy under s. ,18. The culpable negligence, miscon-
duct, misappropriation, fraudulent conduct etc. are relevant
facts to be established in the proceedings under s. 40. But
that is not so under s. 48. Therefore, mere initiation or an
order passed under s. 40 does not divest the jurisdiction or
power of the Registrar under s. 48 when it was referred to
for a decision of the dispute. Exercise of the jurisdiction
to pass an award under s. ,18(3) or revision under s.-56
does not amount to double jeopardy. We are informed that an
appeal before the Government is pending against surcharge
order under s. 40. We express no opinion thereon. We hold
that exercise of the power to pass an award under s. 48 does
not amount to double jeopardy. The appellate order of the
Dy. Registrar is obviously and palpably illegal and rightly
corrected. The appeal is accordingly dismissed, but since
none appeared for the respondents we order no costs.
V.P.R Appeal dismissed.
152