Bant Singh vs State of Punjab

D.V. Sehgal, J.

This judgment will also dispose of C.W.P. Nos. 2052 to 2059 of 1985, 2176 of 1985, 2177 of 1985 and 2199 to 2205 of 1985.

I take the facts of the present case Bant Singh petitioner is a member of the Bir Kalan Cooperative Agricultural Service Society Ltd. respondent No. 6. He used to take loans from it and was paying the same back from time to time through Ram Singh respondent No. 4, who was its Cashier and who used to record entries to this effect in the passbook in the petitioner''s possession issued by the Society, respondent No. 6. A claim for Rs. 8415/ was made by respondent No. 6 against the petitioner. Since he had made the payment of this amount which was duly entered in the pass book in his possession, he denied his liability. The dispute was referred for arbitration under sections 55/56 of the Punjab Cooperative Societies Act, 1961, which was adjudicated upon by the Assistant Registrar, Cooperative Societies, Malerkotla, respondent No. 2, as Arbitrator Respondent No. 6 with a view to recover the amount of Rs. 8415/ besides interest thereon arrayed the petitioner, Darbara Singh exSecretary of respondent No. 6 Ram Singh, its exCashier, and Jatinder Singh its exAdministrator. Respondent No. 2 vide his award Annexure P. 1 recorded a finding to the effect that the principal amount of Rs. 8011.25 and interest amounting to Rs. 335.74 was paid by the petitioner to Ram Singh cashier respondent No. 4. He also produced a receipt for Rs. 8415/ which is in the handwriting of respondent No. 4. The Arbitrator, however, found that this amount had not been entered by Ram Singh in the books of account of the Society nor had he deposited the same in the Central Cooperative Bank on behalf of the Society. Vide award Annexure P. 1 respondent No. 2, held the petitioner and respondents No. 3 and 4, the exSecretary and the exCashier of the Societyrespondent No. 6, equally liable to pay the amount of Rs. 8415/ as principal and Rs. 250/ as costs besides interest at the rate of 141/2 per cent per annum to the Societyrespondent No. 6. No reasons have been recorded in Annexure P. 1 as to why the petitioner despite proof of the fact that he had paid the entire amount of loan with interest was being made to share the liability for the amount along with respondents No. 3 and 4, the exSecretary and the exCashier of respondent No. 6, who apparently been held liable for defalcation and illegal misappropriation of the amount paid by the petitioner to respondent No. 6 through its Cashier respondent No. 4. The appeal filed by the petitioner was dismissed vide order Annexure P.2 and his revision also met the same fate and was dismissed by the Deputy Secretary, Cooperation (Appeals), Punjab, vide order Annexure P. 3.

In the absence of any evidence or a finding to the effect that there was any collusion between the petitioner and the exCashier and the exSecretary of the Society the payment found to have been made of the entire amount of loan along with interest to respondent No. 6 through its Cashier respondent No. 4, for which he holds a valid receipt executed by respondent No. 4, and payment of which is also evidenced by the entry in the passbook in his possession, there is no earthly reason for making the petitioner liable to pay the said amount twice over. He could not be made liable to share the liability determined by respondent No. 2 vide Annexure P. 1 with respondents No. 3 and 4, the persons held responsible for defalcation and misappropriation of the amount to their own use.

I, therefore, allow these petitions, quash the award and the orders passed in appeal and revision Annexures P.1, P.2, and P.3 in so far as the petitioners are held liable thereby for payment of the amount due to respondent No. 6. The liability determined through the award Annexure P. 1 shall instead be shared equally by the exSecretary and the exCashier. There shall, however, be no order as to costs.