ORDER
Patil, J.
1. This Writ Petition is directed against the order dated 29.11.2000 passed in Revision Petition No. 29/2000 by the KAT, Bangalore, vide Annexure-B.
2. The petitioner is a co-operative society registered under the provisions of Karnataka Co-operative Societies Act, 1959. Respondent Nos. 1 to 3 were the employees of the petitioner at the relevant period Respondent No. 1 was the Cane Accountant, respondent No. 2 was the Accountant of the State Accounts working on deputation and respondent No.3 was performing the duties of collecting cash, cheques/drafts etc. given in favour of the factory. Be that as it may Respondents 1 to 3, at the relevant period, had delivered sugar in violation of the conditions after accepting cheques and thereafter delayed in presenting the same to the Bank for encashment. Thus, the factory has suffered loss. That under such circumstances, the Director of Sugar/Additional Registrar of Cooperative Societies, on 29.5.1981, ordered for enquiry under Section 64 of the Karnataka Co-operative Societies Act. Accordingly, the Joint Registrar of Co-operative Societies, Belgaum, held an enquiry and submitted a report holding that the petitioner has suffered loss by way of interest to the tune of Rs. 2,03,108.08. The said report was accepted by the Director of Sugar and further orders were issued on 31.3.1989 under Section 68 of the Act to take suitable action for recovery of the said amount from respondents 1 to 3 as per the report. On the basis of the enquiry report submitted under Section 64 of the Act and the order of the Director of Sugar dated 31.3.1989 issued under Section 68 of the Act, the petitioner filed a dispute before the Director of Sugar for recovery of Rs. 2,03,108.08 from respondents 1 to 3. The Director, after satisfying himself regarding the maintainability of the dispute, entertained the same and referred it to respondent No.4 for disposal Respondents 1 to 3 filed an application before respondent No.4 raising the question of limitation. The said application was rejected holding that the dispute was maintainable and was within time. Feeling aggrieved by the said order, respondents 1 to 3 filed a revision before the Karnataka Appellate Tribunal in Revision Petition No. 29/2000. The said revision petition came up for consideration on 29.11.2000. The KAT, after considering the oral and documentary evidence available on the file, allowed the revision and set aside the order passed by respondent No. 4, holding that the said dispute is barred by limitation. Feeling aggrieved by the order passed by the KAT, the petitioner has presented this Writ Petition.
3. The Principal submission canvassed by the learned Counsel for the petitioner is that the KAT was in error in reversing the order of respondent No. 4 and dismissing the dispute as barred by time contrary to the relevant provisions of the Co-operative Societies Act and Rules. Further, he vehemently submitted that enquiry has been initiated against respondent 1 to 3 by the competent authority under Section 64 of the Co-operative Societies Act and after holding enquiry, it is found that respondents 1 to 3 have misappropriated and mismanaged the affair of the petitioner – Factory thereby the petitioner incurred loss to the tune of Rs. 2,03,108.08. In pursuance of the said report, the Director of Sugar has passed an order dated 31.3.1989 under Section 68 of the Act. After passing the said order and after satisfying himself regarding the maintainability of the dispute, he has referred the matter to respondent No. 4 for disposal. This fact has been over sighted by the KAT. Further, he pointed out that in the order passed by the 4th respondent vide Annexure-A, reasons are assigned why there is no delay and this fact has not at all taken into consideration by the Tribunal. The Tribunal has passed the impugned order only on the ground that the petitioner – factory has incurred loss during the years 1972 to 1977 and the cause of action arose soon after the last transaction which took place during the year 1977 and from the year 1977, the dispute should have been raised within six years and therefore it is barred by time. He therefore submitted that the reasoning given by the Tribunal is not in accordance with law and hence the impugned order is liable to be set aside.
4. Per contra, the learned Counsel appearing for respondents 1 to 3, interalia, contended and justified the impugned order passed by the Tribunal. He submitted that during the course of argument before the revisional authority, the counsel appeared for the petitioner has not brought to the notice of the Tribunal that proceedings has been initiated under Section 64 and order has been passed under Section 68 of the Act. He submitted that it is a fact that the petitioner – factory incurred loss during 1977. The cause of action arise in the year and the dispute should have been presented/referred to the 4th respondent within six years from that date. But, in the instant case, dispute has been referred to 4th respondent in the year 1991 which is beyond the prescribed limitation and therefore the Tribunal is right in passing the impugned order. He submitted that the petitioner has not made out any good grounds to interfere with the impugned order and therefore the Writ Petition is liable to be dismissed.
5. Per contra, the learned Government Pleader appearing for 4th respondent, interalia, contended and justified the order passed by 4th respondent dated 4.4.2000 holding that the dispute referred to the 4th respondent by the Director of Sugar is within the limitation period because the enquiry initiated against respondents 1 to 3 under Section 64 of the Act has been concluded and the same was submitted to the Director of Sugar who in turn passed the order dated 31.3.1989 under Section 68 of the Act and from that date, limitation should be calculated. Therefore, from the date of the order passed by the Director of Sugar under Section 68 of the Act i.e. 31.3.1989, the dispute is well within the prescribed limitation. He submitted that this aspect of the matter has not at all been taken into consideration by the Tribunal and hence the impugned order is liable to be set aside.
6. I have heard the learned Counsel for the petitioner and the learned Counsel appearing for the respondents and perused the orders passed by KAT and the 4th respondent.
7. After careful perusal of the order passed by 4th respondent, I do not find any error of law or illegality. In the instant case, there was misappropriation/mismanagement committed by respondents 1 to 3 during the years 1972 to 1977 and in view of the same, the petitioner -factory has suffered loss. The Director of Sugar ordered enquiry under Section 64 of the Act on 29.5.1981 and in pursuance of the said order, the Joint Registrar of Co-operative Societies, Belgaum, after conducting enquiry as envisaged under the relevant provisions of the Act, has submitted the report holding that the petitioner – factory has suffered loss to the tune of Rs. 2,03,108.08. The said report was accepted by the Director of Sugar and accordingly, on 31.3.1989, he passed an order under Section 68 of the Act. In pursuance of the said order, the petitioner raised a dispute before the Director of Sugar for recovery of Rs. 2,03,108.08 from respondents 1 to 3. The Director of Sugar entertained the same and referred to it 4th respondent for disposal. When the matter was pending adjudication before the 4th respondent, after receipt of notice, respondents 1 to 3 raised preliminary objection regarding the maintainability of the dispute. The 4th respondent, after considering their objections and after taking into consideration the relevant provisions of the Act, has held that the said dispute referred to him is well within the time from the date of order passed by the Director of Sugar in the year 1989. Feeling aggrieved by the said order, respondents 1 to 3 filed a revision before the KAT. The Tribunal allowed the revision and set aside the order passed by 4th respondent contrary to the relevant provisions of the Act and without taking into consideration the material facts available on the records. The Tribunal has over sighted regarding the enquiry initiated against respondents 1 to 3. If this aspects of the matter is taken into consideration, the Tribunal ought not to have held that the dispute raised under Section 70 of the Co-operative Societies Act is barred by time. The said reasoning/finding given by the Tribunal without reference to the order passed by the Director of Sugar is not sustainable in law. In my considered view, the Tribunal has committed an error in holding that in the instant case cause of action arose in the year 1977 and the dispute ought to have been raised within six years from that date and not from the date of the order passed by the Director of Sugar.
8. Having regard to the facts and circumstances of the case as stated above, the impugned order passed by the KAT cannot be sustained and it is liable to be set aside.
9. For the foregoing reasons, the Writ Petition stands disposed of with the following directions:
1. Writ Petition is allowed. The impugned order passed by the KAT dated 29.11.2000 in Revision Petition No. 29/ 2000 is hereby set aside. The matter stands remitted back to the 4th respondent for fresh consideration.
2. The 4th respondent is directed to decide the dispute in strict compliance of the mandatory provisions of Karnataka Co-operative Societies Act and Rules after affording opportunity to the petitioner and respondents 1 to 3, as expeditiously as possible.
10. The learned Government Pleader is permitted to file his memo of appearance within four weeks from today.
