{"id":100439,"date":"2010-09-28T00:00:00","date_gmt":"2010-09-27T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/vinubhai-vs-district-on-28-september-2010"},"modified":"2016-12-27T02:30:52","modified_gmt":"2016-12-26T21:00:52","slug":"vinubhai-vs-district-on-28-september-2010","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/vinubhai-vs-district-on-28-september-2010","title":{"rendered":"Vinubhai vs District on 28 September, 2010"},"content":{"rendered":"<div class=\"docsource_main\">Gujarat High Court<\/div>\n<div class=\"doc_title\">Vinubhai vs District on 28 September, 2010<\/div>\n<div class=\"doc_author\">Author: Ks Jhaveri,&amp;Nbsp;<\/div>\n<pre>   Gujarat High Court Case Information System \n\n  \n  \n    \n\n \n \n    \t      \n         \n\t    \n\t\t   Print\n\t\t\t\t          \n\n  \n\n\n\t \n\t \n\t \n\t \n\t \n\t \n\t \n\t \n\t \n\t \n\t \n\t \n\t \n\t\n\n\n \n\n\n\t \n\nSCA\/15465\/2004\t 7\/ 7\tJUDGMENT \n \n \n\n\t\n\n \n\nIN\nTHE HIGH COURT OF GUJARAT AT AHMEDABAD\n \n\n \n\n\n \n\nSPECIAL\nCIVIL APPLICATION No. 15465 of 2004\n \n\n \n \nFor\nApproval and Signature:  \n \nHONOURABLE\nMR.JUSTICE KS JHAVERI\n \n \n=========================================================\n\n \n\t  \n\t \n\t  \n\t\t \n\t\t\t \n\n1\n\t\t\n\t\t \n\t\t\t \n\nWhether\n\t\t\tReporters of Local Papers may be allowed to see the judgment ?\n\t\t\n\t\n\n \n\t  \n\t \n\t  \n\t\t \n\t\t\t \n\n2\n\t\t\n\t\t \n\t\t\t \n\nTo be\n\t\t\treferred to the Reporter or not ?\n\t\t\n\t\n\n \n\t  \n\t \n\t  \n\t\t \n\t\t\t \n\n3\n\t\t\n\t\t \n\t\t\t \n\nWhether\n\t\t\ttheir Lordships wish to see the fair copy of the judgment ?\n\t\t\n\t\n\n \n\t  \n\t \n\t  \n\t\t \n\t\t\t \n\n4\n\t\t\n\t\t \n\t\t\t \n\nWhether\n\t\t\tthis case involves a substantial question of law as to the\n\t\t\tinterpretation of the constitution of India, 1950 or any order\n\t\t\tmade thereunder ?\n\t\t\n\t\n\n \n\t  \n\t \n\t  \n\t\t \n\t\t\t \n\n5\n\t\t\n\t\t \n\t\t\t \n\nWhether\n\t\t\tit is to be circulated to the civil judge ?\n\t\t\n\t\n\n \n\n \n=========================================================\n\n \n\nVINUBHAI\nJETHABHAI PATEL &amp; 5 - Petitioner(s)\n \n\nVersus\n \n\nDISTRICT\nREGISTRAR &amp; 2 - Respondent(s)\n \n\n=========================================================\n \nAppearance\n: \nMR\nBAIJU JOSHI for\nPetitioner(s) : 1 - 6. \nGOVERNMENT PLEADER for Respondent(s) : 1 -\n2. \nRULE SERVED BY DS for Respondent(s) : 1 - 2. \nMR SN THAKKAR\nfor Respondent(s) :\n3, \n=========================================================\n\n\n \n\t  \n\t \n\t  \n\t\t \n\t\t\t \n\nCORAM\n\t\t\t: \n\t\t\t\n\t\t\n\t\t \n\t\t\t \n\nHONOURABLE\n\t\t\tMR.JUSTICE KS JHAVERI\n\t\t\n\t\n\n \n\n \n \n\n\n \n\nDate\n: 28\/09\/2010 \n\n \n\n \n \nORAL\nJUDGMENT<\/pre>\n<p>\tBy<br \/>\nway of the present petition, the petitioners have challenged the<br \/>\norder dated 18.10.2004 passed by the Gujarat State Cooperative<br \/>\nTribunal in Appeal No.1324 of<br \/>\n2003 filed by the petitioners, whereby the appeal has been dismissed.\n<\/p>\n<p>2.\tThe<br \/>\nbrief facts of the case are that, the petitioners are Members of the<br \/>\nManaging Committee of the respondent No.3-Society registered under<br \/>\nthe Gujarat Cooperative Societies Act, 1963 (hereinafter referred to<br \/>\nas &#8216;the Act&#8217; for short) and the said Society was under liquidation<br \/>\nand the Liquidator had taken over the charge of the said Society.\n<\/p>\n<p>2.1\tIt<br \/>\nis alleged that the audit of the respondent No.3-Society for the<br \/>\nperiod from 1.7.2000 to 31.3.2001 was held and certain irregularities<br \/>\nwere found  and upon the remarks of the Auditor, the respondent No.1\n<\/p>\n<p>&#8211; District Registrar, Cooperative Societies, Sabarkantha issued<br \/>\na show cause notice on 19.7.2002 to the petitioners to the effect<br \/>\nthat due to the irregularities committed by the Members of the<br \/>\nManaging Committee in respect of sales and purchase of wheat, there<br \/>\nwas loss of Rs.96,556\/- and in addition to that, inclusive of<br \/>\nweighing charges, godown rent and interest, in all, there was a total<br \/>\nloss of Rs.1,65,350\/- to the Society.  The petitioners filed their<br \/>\nreply to the said show cause notice on 26.8.2002 denying all the<br \/>\ncharges levelled against the members of the Managing Committee.  It<br \/>\nis alleged that, without considering the reply of the petitioners,<br \/>\nthe respondent No.1 had initiated proceedings on 30.11.2002,  under<br \/>\nSection 93 of the Act and appointed the respondent No.2 as Enquiry<br \/>\nOfficer to hold inquiry under<br \/>\nSection 93  of the Act against the petitioners.\n<\/p>\n<p>2.2\tPursuant<br \/>\nto the aforesaid order, the respondent No.2 issued a show cause<br \/>\nnotice on 10.2.2003, which according to the petitioners was vitiated<br \/>\nright from the beginning, i.e. at the stage of issuance of the show<br \/>\ncause notice by the Enquiry Officer.  The petitioners filed a<br \/>\ndetailed reply on 21.2.2003 to the said show cause notice, but<br \/>\nwithout considering the same, the respondent No.2 issued a charge<br \/>\nsheet against the petitioners on 6.5.2003. The petitioners gave a<br \/>\ndetailed reply on 24.6.2003 as well as another reply on 28.7.2003. It<br \/>\nis alleged that, without considering the replies given by the<br \/>\npetitioners, the respondent No.2 submitted a report of enquiry held<br \/>\nunder Section 93 of the Act to the respondent No.1 holding all the<br \/>\nMembers of the Managing Committee were equally responsible and<br \/>\nsuggested to recover the amount from the Members of the Managing<br \/>\nCommittee of the respondent No.3- Society.\n<\/p>\n<p>2.3\tAccording<br \/>\nto the petitioners, under the provisions of the Act and the Rules<br \/>\nframed thereunder, no person can hold the office or become a Member<br \/>\nof the Managing Committee when any order is passed against him under<br \/>\nSection 93 of the Act as provided under Rule 32 of the Gujarat<br \/>\nCooperative Societies Rules.  It is alleged that, by virtue of the<br \/>\nenquiry report, none of the petitioners is in a position to hold the<br \/>\noffice of the Member of the Managing<br \/>\nCommittee of any Society for the alleged irregularities, which is not<br \/>\neven a misconduct or misappropriation.\n<\/p>\n<p>2.4\tBeing<br \/>\ndissatisfied with the report submitted by the respondent No.2 to the<br \/>\nrespondent No.1 dated 4.8.2003, the petitioner preferred an appeal<br \/>\nbeing Appeal No.1324 of 2003 before the Gujarat State Cooperative<br \/>\nTribunal, at Ahmedabad. The Tribunal, after hearing the parties,<br \/>\ngranted interim relief vide order dated 7.10.2003 and stayed the<br \/>\norder until 17.10.2003 by observing that it appears that there is no<br \/>\npersonal interest of the Members of the Managing Committee and there<br \/>\nare also other issues which require consideration and therefore, the<br \/>\nappeal was admitted.  But, ultimately, the Tribunal dismissed the<br \/>\nappeal on 18.10.2004 and the said order is under challenge in this<br \/>\npetition, as aforesaid.\n<\/p>\n<p>3.\tI<br \/>\nhave heard learned advocates for the parties. Learned advocate<br \/>\nMr.Joshi appearing for the petitioners submitted that the petitioners<br \/>\nhave been working as Members of the Society for a long time and they<br \/>\nhave not committed any irregularity or misappropriation of the funds<br \/>\nof the Society. He submitted that there was overall slackness in the<br \/>\nbusiness of wheat, the wheat lying in the godown might get spoiled<br \/>\nand, with a view to see that there might not be total loss in the<br \/>\nsales and purchases of wheat, it was decided to sell such wheat at a<br \/>\nlesser price than the market value in the interest of the Society<br \/>\nand therefore, the Members of the Managing Committee had acted in the<br \/>\ninterest of the Society with bona fide intention and therefore, the<br \/>\ninquiry conducted under Section 93 of the Act holding the Members of<br \/>\nthe Managing Committee responsible for the loss caused to the Society<br \/>\nis against the provisions of law and hence, the order dated<br \/>\n18.10.2004 passed by the Tribunal and the enquiry report submitted by<br \/>\nthe respondent No.2 to the respondent NO.1 is required to be quashed<br \/>\nand set aside. He further submitted that the action taken by the<br \/>\nMembers of the Managing Committee and the Resolution passed by the<br \/>\nsaid Committee had been approved by the General Body, which is<br \/>\nsupreme, under the provisions of the Act and therefore, when the<br \/>\naction taken by the Managing Committee which is approved by the<br \/>\nGeneral Body, it is not proper to hold anybody responsible under<br \/>\nSection 93 of the Act as it is well settled proposition. He has<br \/>\nrelied upon a judgment reported in 2003 (1) GLR 462, wherein it has<br \/>\nbeen held that, &#8220;where the General Body approved the proposal<br \/>\nand pursuant thereto expenditure was incurred, it was not proper to<br \/>\nhold anybody responsible under Section 93 of the Act.&#8221;<br \/>\nTherefore, according to him, when the Resolution passed by the<br \/>\nManaging Committee approved by the General Body in the Annual General<br \/>\nMeeting, no proceeding under Section 93 of the Act can be initiated<br \/>\nholding the Members of the Managing Committee responsible for the<br \/>\nloss incurred to the respondent Society.\n<\/p>\n<p>4.\tOn<br \/>\nbehalf of the respondent No.3, an affidavit-in-reply has been filed<br \/>\nby the Official Liquidator controverting the averments made in the<br \/>\npetition. In reply thereto, the petitioners have filed a rejoinder<br \/>\ndenying the averments made in the affidavit-in-reply. The petitioner<br \/>\nNo.1 has also filed a further rejoinder wherein it is stated that the<br \/>\npetitioners have deposited the entire amount towards the alleged loss<br \/>\nincurred to the respondent Society and hence, the petition deserves<br \/>\nto be allowed.\n<\/p>\n<p>5.\tLearned<br \/>\nadvocate Mr.Joshi has further submitted that, as aforesaid, the<br \/>\npetitioners have have already paid the amount to the Society towards<br \/>\nthe alleged loss incurred during the interregnum period and<br \/>\ntherefore, no action may be taken against the petitioners under the<br \/>\nprovisions of Section 93 of the Act and hence, the petition is<br \/>\nrequired to be allowed. He also submitted that the amount which has<br \/>\nbeen deposited by the petitioners can be appropriated for the benefit<br \/>\nof the Society and the alleged act on the part of the petitioners may<br \/>\nnot be treated as disqualification of the Members of the Society.\n<\/p>\n<p>6.\tFrom<br \/>\nthe facts of the case, it is found that the action taken by the<br \/>\nMembers of the Managing Committee and the resolution passed by the<br \/>\nManaging Committee had been approved by the General Body. It is also<br \/>\na fact that bye-law No.2(4) of the Society empowers to carry on the<br \/>\nbusiness in a particular manner in the interest of the respondent<br \/>\nSociety and the finding states that the Managing Committee ought to<br \/>\nhave taken care, which would mean that there was no mens rea<br \/>\nor mala fide intention on the part of the Managing Committee. It also<br \/>\ncannot be said that there was personal interest involved. Having<br \/>\nconsidered the overall facts and circumstances of the case, I am of<br \/>\nthe view that interests of justice would be met by passing the<br \/>\nfollowing order:\n<\/p>\n<p>\tThe<br \/>\nimpugned order dated 18.10.2004 passed by the Gujarat State<br \/>\nCooperative Tribunal, at Ahmedabad in Appeal No. 1324 of 2003 and the<br \/>\nenquiry report submitted by the respondent No.2 to the respondent<br \/>\nNo.1 are hereby quashed and set aside.  Considering the fact that the<br \/>\nentire amount as  alleged to have been incurred as loss to the<br \/>\nSociety has already been deposited by the petitioners, the action on<br \/>\ntheir part will not be treated as disqualification as per the<br \/>\nprovisions of Section 93 of the Act. Further, as suggested by learned<br \/>\nadvocate Mr.Joshi, the amount which has been so deposited by the<br \/>\npetitioners with the Society towards the alleged loss, may be<br \/>\nappropriated for the benefit of the Society.\n<\/p>\n<p>7.\tThe<br \/>\npetition is allowed accordingly and rule is made absolute, with no<br \/>\norder as to costs.\n<\/p>\n<pre>Sreeram.\t\t\t\t\t\t(K.S.Jhaveri,\nJ.)\n\n    \n\n \n\t   \n      \n      \n\t    \n\t\t   \u00a0\u00a0\u00a0\n\t   \n      \n\t  \t    \n\t\t   Top\n\t   \n      \n\n\n<\/pre>\n","protected":false},"excerpt":{"rendered":"<p>Gujarat High Court Vinubhai vs District on 28 September, 2010 Author: Ks Jhaveri,&amp;Nbsp; Gujarat High Court Case Information System Print SCA\/15465\/2004 7\/ 7 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No. 15465 of 2004 For Approval and Signature: HONOURABLE MR.JUSTICE KS JHAVERI ========================================================= 1 Whether Reporters of Local Papers may [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[16,8],"tags":[],"class_list":["post-100439","post","type-post","status-publish","format-standard","hentry","category-gujarat-high-court","category-high-court"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Vinubhai vs District on 28 September, 2010 - Free Judgements of Supreme Court &amp; 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