{"id":190106,"date":"2010-09-17T00:00:00","date_gmt":"2010-09-16T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/t-s-muthiah-vs-the-state-through-the-on-17-september-2010"},"modified":"2016-06-19T07:27:15","modified_gmt":"2016-06-19T01:57:15","slug":"t-s-muthiah-vs-the-state-through-the-on-17-september-2010","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/t-s-muthiah-vs-the-state-through-the-on-17-september-2010","title":{"rendered":"T.S.Muthiah vs The State Through The on 17 September, 2010"},"content":{"rendered":"<div class=\"docsource_main\">Madras High Court<\/div>\n<div class=\"doc_title\">T.S.Muthiah vs The State Through The on 17 September, 2010<\/div>\n<pre>       \n\n  \n\n  \n\n \n \n BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT\n\nDATED: 17\/09\/2010\n\nCORAM\nTHE HONOURABLE MS.JUSTICE R.MALA\n\nCrl.O.P(MD)No.1446 of 2010\nCrl.O.P(MD)No.1447 of 2010\nCrl.O.P(MD)No.1448 of 2010\nCrl.O.P(MD)No.1453 of 2010\nand\nCrl.O.P(MD)No.1458 of 2010\nand M.P.(MD) Nos.2 of 2010 (in each Crl.O.Ps.)\n\nT.S.Muthiah\t\t\t.. Petitioner in all the petitions\n\nVs\n\nThe State through the\nDeputy Superintendent of Police,\nEconomic Offences Wing of Police,\nTirunelveli.\nCrime No.8 of 2003\t\t... Respondent in all the petitions<\/pre>\n<p>\tCriminal Original Petitions under Section 482 of the Code of Criminal<br \/>\nProcedure, to call for the records relating to the proceedings in C.C.Nos.2, 4,<br \/>\n3, 5, 1 of 2006 respectively on the file of the learned Judicial Magistrate<br \/>\nNo.II, Tirunelveli and quash the same.\n<\/p>\n<pre>!For Petitioner    ... Mr.G.Prabhu Rajadurai\n^For Respondent    ... Mr.L.Murugan, Govt. Advocate (Crl. Side)\n\n:COMMON ORDER\n<\/pre>\n<p>\tIn view of the fact that the petitioner and the respondent, in all the<br \/>\npetitions, are one and the same and as all the cases are with similar issues,<br \/>\nboth factual and legal, they have been taken up together for disposal.\n<\/p>\n<p>\t2. The petitioner is arrayed as A3, A3, A2, A3 and A2 in C.C.Nos.2, 4, 3,<br \/>\n5 and 1  of 2006 respectively. He joined as a Junior Assistant in Treasuries and<br \/>\nAccounts Department in the year 1964 and he retired from his service on<br \/>\n31.07.2001 and he is drawing pension for the past 8 years.  While he was in<br \/>\nservice, he was a member in Tirunelveli District Public Servants Co-operative<br \/>\nThrift Society and he was elected as a Board of Directors in the year 1996 for a<br \/>\ntenure of 5 years  and he was selected by the Board to function as its<br \/>\nPresident.  The Secretary of the said Society, namely one A.Kartheesan, in<br \/>\ncollusion with one H.Ganesan, working in the Co-operative Central Bank,<br \/>\nmisappropriated the funds of the said Society to the tune of Rs.1,15,31,600\/-<br \/>\nand hence, the respondent-Police registered a case in crime No.8 of 2003 on<br \/>\n11.12.2003 against them for the commission of offences under Sections 408 and<br \/>\n477-A read with 120-B, I.P.C.  After investigation, the charge sheet has been<br \/>\nfiled, which were taken on file in C.C.Nos.2, 4, 3, 5 and 1  of 2006<br \/>\nrespectively by the learned Judicial Magistrate No.II, Tirunelveli, wherein the<br \/>\npetitioner and other Executive Committee members were arraigned on the<br \/>\nallegations that they failed in their duty to administer and supervise the<br \/>\nfunctions of the society as provided under the Bye-Laws of the said Society.\n<\/p>\n<p>\t3. It is stated by the learned counsel for the petitioner that the<br \/>\npetitioner is totally innocent and had nothing to do with the said offences and<br \/>\neven by the wordings in the charge sheet, they only failed to comply with the<br \/>\nBye-Laws of the said Society and hence, the other accused filed petitions in<br \/>\nCrl.O.P.Nos.1187 and 1188 of 2006 and Crl.O.P.Nos.4513, 4569, 4570 and 4576 of<br \/>\n2008 and Crl.O.P.No.10148 of 2009 to discharge them from the charges levelled<br \/>\nagainst them and the same were allowed, quashing the complaints against them.<br \/>\nSince, the present petitioner is also placed in similar footing with such<br \/>\ncircumstances, the petitioner has come forward with the present Crl.O.Ps. for<br \/>\nquashing the complaints in C.C.Nos.2, 4, 3, 5, 1  of 2006 respectively on the<br \/>\nfile of the Judicial Magistrate No.II, Tirunelveli.  To substantiate his<br \/>\ncontentions, learned counsel for the petitioner relied upon various orders of<br \/>\nthis Court.\n<\/p>\n<p>\t4. The learned Government Advocate (Criminal Side) appearing for the<br \/>\nrespondent-Police, would submit that the petitioner was a President of the<br \/>\nSociety and his duty is to supervise the work of the staff, but he was negligent<br \/>\nin performing his duty; only due to his negligence, the offences had been<br \/>\ncommitted; the amount of misappropriation is more than one crore of rupees; but,<br \/>\nhe has fairly conceded that similarly placed accused were either discharged or<br \/>\ncharges against them are quashed and hence, he prayed for the dismissal of the<br \/>\nCrl.O.Ps.\n<\/p>\n<p>\t5. Heard the learned counsel appearing for the petitioner as well as the<br \/>\nlearned Government Advocate (Criminal Side) and perused the entire materials<br \/>\navailable on record.\n<\/p>\n<p>\t6. The petitioner was a President of the Tirunelveli District Public<br \/>\nServants Co-operative Thrift Society and he was arrayed as A3, A3, A2, A3 and A2<br \/>\nin C.C.Nos.2, 4, 3, 5 and 1  of 2006 respectively, on the file of the learned<br \/>\nJudicial Magistrate No.II, Tirunelveli.  The case of the prosecution is that a<br \/>\nloan obtained from the Central Co-operative Bank was distributed to the members<br \/>\nof the Tirunelveli District Public Servants           Co-operative Thrift<br \/>\nSociety, that the Society collected money towards repayment of loans from the<br \/>\nmembers concerned, but in remitting such loan amounts in the Central Co-<br \/>\noperative Bank, the Secretary of the Society viz., A.Kartheesan\/A1, tampered<br \/>\nwith the challans so that the counter-foils thereto reflected the position of<br \/>\nremittances with the Central Co-operative Bank in a higher sum while the actual<br \/>\nremittance was of a lesser sum.  A.1, who was the Secretary of the Tirunelveli<br \/>\nDistrict Public Servants Co-operative Thrift Society is said to have indulged in<br \/>\nsuch action with the collusion of A.2, who was the assistant. The differential<br \/>\nsums are said to have been misappropriated by A.1 and A.2. The other accused are<br \/>\nthe Directors of the Tirunelveli District Public Servants Co-operative Thrift<br \/>\nSociety. The allegations against the petitioner and others, is that they failed<br \/>\nto maintain the accounts of the society as Directors and that they failed to<br \/>\ntake action against the Secretary who indulged in malpractice and thereby<br \/>\ninstigated and abetted the Secretary in the misappropriation committed by him.\n<\/p>\n<p>\t7. As per Section 84 of the Tamil Nadu Co-operative Societies Act, for<br \/>\nmaintenance of accounts and books of the Registered Society, the Chief Executive<br \/>\ni.e. the Principal Paid Officer or the President of the Society is the<br \/>\nresponsible person.  It is appropriate to extract Section 84 of the Tamil Nadu<br \/>\nCo-operative Societies Act and Clause 26 of the Bye-Laws of the Tirunelveli<br \/>\nDistrict Public Servants Co-operative Thrift Society, as follows:<br \/>\n\t&#8220;Section 84 of the Tamil Nadu Co-operative Societies Act: Maintenance of<br \/>\naccounts and books by registered society &#8211;The Chief Executive that is, the<br \/>\nPrincipal Paid Officer of every registered Society by whatsoever designation he<br \/>\nis called, or the president of that society, if there is no such chief executive<br \/>\nin that society, shall be bound to keep and maintain such accounts and books<br \/>\nrelating to that society in such manner as may be prescribed. He shall be<br \/>\nresponsible for the correct and up to date maintenance of such accounts and<br \/>\nbooks and for producing them when called for in connection with audit under<br \/>\nSection 80 or inquiry under Section 81 or inspection or investigation under<br \/>\nsection 82 or Inspection of books under Section 83.&#8221;\n<\/p>\n<p>\t&#8220;Clause 26 of the bye-laws of the Society: It shall be the duty of the<br \/>\nBoard of Directors to maintain such accounts and registers are prescribed by<br \/>\nRule 13 of the rules under the Act and by the Registrar from time to time, to<br \/>\nplace before a general body meeting of the member the Registrar&#8217;s notes of audit<br \/>\nor inspection within one month from the date of receipt to correspond with the<br \/>\nRegistrar and to do all other business relating to the Society.&#8221;\n<\/p>\n<p>Thus, it is seen that Bye-Law 26 of the Society deals that the Board of<br \/>\nDirectors to maintain the accounts and registers as are prescribed by Rule 13 of<br \/>\nthe rules under the Act.\n<\/p>\n<p>\t8. At this juncture, it is appropriate to quote the observations of the<br \/>\nSupreme Court made in paragraph 15 of the decision reported in <a href=\"\/doc\/1998529\/\">Babaji Kondaji<br \/>\nGarad v. Nasik Merchants Co-operative Bank Ltd.,Nasik,<\/a> (1984) 2 SCC 50:<br \/>\n\t&#8220;15. Section 73-B provides a legislative mandate. Rule 61 has a status of<br \/>\nsubsidiary legislation or delegated legislation. By-law of a co-operative<br \/>\nsociety can at best have the status of an article of association of a company<br \/>\ngoverned by the Companies Act, 1956 and as held by this Court in <a href=\"\/doc\/1778556\/\">Co-operative<br \/>\nCentral Bank Ltd. v. Additional Industrial Tribunal, Andhra Pradesh<\/a> (1969 (2)<br \/>\nSCC 43 : 1970 (1) SCR 205)  the by-laws of a co-operative society framed in<br \/>\npursuance of the provision of the relevant Act cannot be held to be law or  to<br \/>\nhave the force of law. They are neither statutory in character nor they have<br \/>\nstatutory flavour so as to be raised to the status of law. Now if there is any<br \/>\nconflict between the statute and the subordinate legislation, it does not<br \/>\nrequire elaborate reasoning to firmly state that the statute prevails over<br \/>\nsubordinate legislation and the by-law if not in conformity with the statute in<br \/>\norder to give effect to the statutory provision the rule or by-law has to be<br \/>\nignored. The statutory provision has precedence and must be complied with.<br \/>\nFurther the opinion of the Deputy Registrar as expressed in his circular dated<br \/>\nFebruary 1, 1979 and his letter dated June 4, 1979 has no relevance because his<br \/>\nlack of knowledge or misunderstanding of law as expressed in his opinion has no<br \/>\nrelevance. The High Court relying upon the aforementioned two documents observed<br \/>\nas under:\n<\/p>\n<p>\t&#8220;There is no inconsistency between Section 73-B and the by-laws because<br \/>\neven Government has construed Section 73-B in such manner that even though the<br \/>\nby-laws are not amended and reserved seats remained unfilled by election the<br \/>\nsame can be filled up by co-option.&#8221;\n<\/p>\n<p>With respect, we find it difficult to subscribe to this untenable approach that<br \/>\na view of law or a legal provision expressed by a Government officer can afford<br \/>\nreliable basis or even guidance in the matter of construction of a legislative<br \/>\nmeasure.  It is the function of the court to construe legislative measures and<br \/>\nin reaching the correct meaning of statutory provision, opinion of executive<br \/>\nbranch is hardly relevant.  Nor can the court abdicate in favour of such<br \/>\nopinion.&#8221;\n<\/p>\n<p>\t9.    A perusal of the order of the lower Court in the connected<br \/>\nproceedings, reflects that it has arrived at the finding, on consideration of<br \/>\nClause 26 of the Bye-Laws, informing that all the Board members were responsible<br \/>\nfor the day-to-day activities of the Society, that such Directors being aware of<br \/>\nthe misappropriation done by the Secretary, had not taken any action against<br \/>\nhim, despite passing a resolution to suspend him and that it was the illegal<br \/>\nomission in taking action against the Secretary that had permitted the<br \/>\ncontinuance of offences till the year 2002. The contention made that the<br \/>\npetitioners in the connected cases, have not been included in the original First<br \/>\nInformation Report, was also negated on the ground that those petitioners stand<br \/>\nimplicated after investigation in the case. The lower Court also has<br \/>\ndistinguished the quashing of proceedings against the Supervisor of the Society<br \/>\non the ground that in her case, no mens-rea in sharing the common purpose in<br \/>\nswindling the amount was made out, nor was there anything to show that she had<br \/>\ncolluded with others in the perpetration of the crime.\n<\/p>\n<p>\t10.  Following the abovesaid decision of the Apex Court in <a href=\"\/doc\/1998529\/\">Babaji Kondaji<br \/>\nGarad v. Nasik Merchants Co-operative Bank Ltd., Nasik,<\/a> (1984) 2 SCC 50, this<br \/>\nCourt is of the considered opinion that where the Tamil Nadu Co-operative<br \/>\nSocieties Act did not hold the Director responsible for the day-to-day affairs<br \/>\nof the Society, such persons could not be held so liable on the basis of the<br \/>\nBye-Laws of the Society. The Bye-Laws in this case, i.e. Clause 26 cannot over-<br \/>\nride Section 84 of the parent Act, i.e. Tamil Nadu Co-operative Societies Act.<br \/>\nThe contention that it was for the Registrar to suspend or take action against<br \/>\nthe Secretary for the misappropriation committed and that the petitioner and<br \/>\nother Directors could only recommend the same, deserves acceptance.  When once<br \/>\nit is seen that the Directors and the present petitioner as President, have<br \/>\nnothing to do with the day-to-day affairs of the Society, the allegations of<br \/>\ntampering with the records and misappropriation of funds would, in the facts of<br \/>\nthe case, stand scrutiny, if at all, only against the A.1 and A.2. This court in<br \/>\nallowing the petitions for quash, under orders in Crl. O.P. Nos.4513, 4569, 4570<br \/>\nand 4576 of 2008 dated 04.11.2009, filed by persons similarly placed as the<br \/>\npetitioner, has reasoned as follows:\n<\/p>\n<p>\t&#8220;8. The specific case of the prosecution is that at the time of<br \/>\nregistering F.I.R., the Secretary, who corrected the challans and deposited a<br \/>\nlesser amount and who informed the Sangam as if that he deposited the actual<br \/>\nmoney collected from the members of the Society, for which the second accused,<br \/>\nwho is working as a Clerk in the Central Co-operative Bank aided the first<br \/>\naccused. The records produced on behalf of the prosecution and the statements<br \/>\ndoes not disclose any involvement of the present petitioners.  As far as the<br \/>\noffence under Sections 408 and 477(A) are concerned, Section 408 I.P.C. deals<br \/>\nwith criminal breach of trust and no stretch of imagination, the petitioner was<br \/>\nentrusted with the money and Section 477 (A) I.P.C is concerned, he is not<br \/>\nhaving any direct access to the records which were altered by the first and<br \/>\nsecond accused concerned.  As far as the offence under Section 109 I.P.C is<br \/>\nconcerned, the prosecution also has miserably failed to prove that there is an<br \/>\ninducement by the present petitioner to commit the above said offences by the<br \/>\nfirst and second accused concerned.\t9. It is further stated that only due to the<br \/>\nreport given by the present petitioner, the case is registered and investigation<br \/>\nconducted by the officers concerned.\n<\/p>\n<p>\t10. Considering the above said facts and circumstances, this Court is of<br \/>\nthe opinion that the lack of supervision, the present petitioners cannot be<br \/>\nroped into a criminal prosecution for the said offence concerned and<br \/>\naccordingly, the charge sheets filed against the petitioner are liable to be<br \/>\nquashed.&#8221;\n<\/p>\n<p>\t11.  Considering the above said orders of this Court and for the above<br \/>\nsaid reasons, I am of the considered view that for the lack of supervision, the<br \/>\npresent petitioner cannot be roped into a criminal prosecution for the offences<br \/>\nconcerned and accordingly, the charge sheets filed against the petitioner, are<br \/>\nliable to be quashed.\n<\/p>\n<p>\t12. Accordingly, these criminal original petitions are allowed and the<br \/>\nproceedings in C.C.Nos.1 to 5 of 2006 on the file of the learned Judicial<br \/>\nMagistrate No.II, Tirunelveli, shall stand quashed, insofar as the petitioner is<br \/>\nconcerned. Consequently, connected miscellaneous petitions are closed.\n<\/p>\n<p>Arul<\/p>\n<p>To<\/p>\n<p>1.The Deputy Superintendent of Police, Economic Offences Wing of Police,<br \/>\n  Tirunelveli.\n<\/p>\n<p>2.The Judicial Magistrate No.II, Tirunelveli.\n<\/p>\n<p>3.The Additional Public Prosecutor,<br \/>\n  Madurai Bench of Madras High Court at Madurai.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Madras High Court T.S.Muthiah vs The State Through The on 17 September, 2010 BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 17\/09\/2010 CORAM THE HONOURABLE MS.JUSTICE R.MALA Crl.O.P(MD)No.1446 of 2010 Crl.O.P(MD)No.1447 of 2010 Crl.O.P(MD)No.1448 of 2010 Crl.O.P(MD)No.1453 of 2010 and Crl.O.P(MD)No.1458 of 2010 and M.P.(MD) Nos.2 of 2010 (in each Crl.O.Ps.) T.S.Muthiah .. Petitioner [&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":[8,13],"tags":[],"class_list":["post-190106","post","type-post","status-publish","format-standard","hentry","category-high-court","category-madras-high-court"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>T.S.Muthiah vs The State Through The on 17 September, 2010 - Free Judgements of Supreme Court &amp; High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/t-s-muthiah-vs-the-state-through-the-on-17-september-2010\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"T.S.Muthiah vs The State Through The on 17 September, 2010 - Free Judgements of Supreme Court &amp; 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