Darshan Singh and Others Vs The State of Punjab

@JUDGMENTTAG-ORDER

Jat Singh Sekhon, J.@mdashDarshan Singh, petitioner No. 1, is Ex-President of the Managing Committee of the Burj Hanumangarh Cooperative Agricultural Service Society, Burj Hanumangarh tehsil Fazilka, while Sukh-deep Singh and Hari Singh, petitioners Nos. 2 and 3, are the Ex/Members of the Managing Committee of that Society. These three petitioners through this petition filed u/s 482 of the Code of Criminal Procedure, 1973, seek the quashment of the proceedings in case bearing first information report No, 171 dated 3-8-1989 registered against them along with others for offences under Sections 408, 409, 465, 468 and 471 read with Section 120B of the Indian Penal Code at Police Station Sadar Abohar, inter alia, on the ground that since the Arbitrator appointed u/s 56 of the Punjab Co-operative Societies Act, 1961, has given award exonerating these petitioners from the above-referred charges, the continuance of the criminal proceedings is in abuse of the process of the Court as the judgment of the Civil Court is binding upon the Criminal Court.

2. In the Return filed by Iqbal Singh, Station House Officer, Police Station Sadar Abohar, on behalf of the respondents, it is stated that the awards of the Arbitrator u/s 56 of the Punjab Co-operative Societies Act are of no consequence as therein the liability of the petitioners having signed the loan papers has not been discussed at all. It is further stated that the award of an Arbitrator u/s 56 of the Punjab Co-operative Societies Act cannot be equated with the judgment of the Civil Court as this award has been deemingly treated as decree for the purposes of its execution etc.

3. The resume of relevant facts figuring in the first information report, based upon the audit report, copy Annexure P-1, and reproduced in the petition reads as under:

"Keeping in view the resolution passed by the Managing Committee of the Society and the audit report, a report has been made that the employees of the Society have, by misusing their positions, embezzled an amount of Rs. 3,67,466.77 paise belonging to the society by spending it for their personal use. The details of that are given in the resolution of the Committee and the special audit report. So a case may be registered against the accused employees for misappropriating a sum of Rs. 3,67,465.77 paise and action be taken against them. Sd/- Assistant Registrar, Cooperative Societies, Fazilka. According to the resolution dated 20-3-1989, the Managing Committee under the Presidentship of Shri Baljit Singh, the following resolutions have been passed today:

(1) The job of writing down today''s proceedings is given to Satnam Dass SINIF-cum-clerk.

(2) The audit of the society for the year 8-5-87 conducted by the audit department is complete. During the course of audit, the audit department has found that some former employees of the society, employees of Bank and the former Managing Committee had misused and misappropriated an amount of Rs. 3,67,465.77 paise and also found serious irregularities. The Assistant Registrar, Cooperative Societies, Fazilka, has in this connection vide letter No. 1303 dated 15-2-88 directed to prepare an F.I.R. against the persons found guilty according to the special audit report. So, the Registrar, Co-operative Societies, Fazilka is requested through this resolution to lodge an F.I.R. against the persons found guilty according to the special audit report. The details are as follows:

Brief contents of special report --

(a) amount embezzled Rs. 3,20,763.30 paise

(b) amount misused; Rs. 36,758.22 paise

(c) serious irregularities Rs. 9,944.25 paise Total: Rs. 3,67,465.77 paise.

(2) Amount embezzled and persons responsible: Rs. 3,20,763.30 paise

(1) Mohinder Pal, Ex-Secretary : Rs. 1,98,948/-.

(2) Gurmel Singh, Ex-Salesman : Rs. 12,390.55 paise

(3) Mohinder Pal, Ex-Secretary and Satnam Dass, Ex-S.M.C.C. Rs. 14,300/-

(4) Mohinder Pal, Ex-Secretary and Gurmel Singh, Ex-Salesman (Fertilizer) : Rs. 14,271/-

(5) Ram Chander, Cashier/ Manager, C.B. Kundal Branch : Rs. 6,000/-

(6) Raj Kumar, Manager and Surinder Kumar, Kundal Branch : Rs. 4,062/-

(7) Mohinder Pal, Gurmel Singh, Raja Ram, Raj Kumar, Ram Chander, Surinder Kumar and the Managing Committee consisting of Darshan Singh, Inder Singh, Sukh-deep Singh and Hari Singh : Rs. 70191.75 paise. Total: Rs. 3,20,763.30 paise

(8) Amount misused Mohinder Pal, Ex-Secretary: Rs. 36,788.22 paise

(9) Serious irregularities Mohinder Pal, Ex-Secretary : Rs. 9,944.25 paise. Grand Total: Rs. 3,67,465.77 paise. Sd/- Baljit Singh, President, etc. Certified that the copy is correct according to the original which is in the proceedings book. Sd/- Secretary, Burj Hanumangarh Co-op. Agricultural Service Society. Forwarded to the Registrar, Cooperative Societies, Fazilka, with recommendation for getting an F.I.R. registered. Sd/- Inspector, Co-operative Societies. Summoned record was brought by the office of Burj Hanumangarh Co-operative Agricultural Service Society, Burj Hanumangarh. I have examined the record and prima facie offences under Sections 408/409/465/468/471 and 120B, IPC are made out and the offences are under the jurisdiction of Police Station Sadar Abohar Sd/- A.D.A. II 13-7-88. Please register and investigate the case. Sd/- Surjit Singh, SSP Ferozepur 22-7-88."

4. I have heard the learned counsel for the parties besides perusing the record.

5. There is no dispute between the parties regarding the legal proposition that the judgment in rem of the civil court is binding upon the criminal Court. The Calcutta High Court in Rajendra Kumar Ruia Vs. State of West Bengal, , had observed that where the civil lialibity in respect of same item of property subject matter of charge of misappropriation in a criminal complaint has been determined by a competent civil court, the judgment of that Court would be the best evidence of the civil rights of the parties and as such the complaint ought not be proceeded with during the pendency of the civil proceedings by way of appeal. It was further held that if the civil proceedings had terminated determining the civil rights in favour of the accused, the criminal proceedings must be dropped since its continuation will be an abuse of the process of the Court.

6. The apex Court in Karam Chand Ganga Prasad and Another Vs. Union of India (UOI) and Others, , has also held that the decisions of the civil court are binding on criminal Courts but the converse is not true. In that case before the Supreme Court, the Delhi High Court had dismissed the writ petition of the accused filed under Article 226 of the Constitution on the ground of pendency of criminal proceedings on the same facts against the accused. Under these circumstances, it was observed that the High Court had wrongly dismissed the writ petition as findings of the criminal Courts are not binding upon the civil Courts. A single Bench of this Court in Major Singh and Others Vs. State of Punjab, , has also observed that the decision of the civil Court on same facts is binding upon criminal Court.

7. Mr. G.S. Cheema, the learned Assistant Advocate General, on the other hand, has relied upon the judgment of the Full Bench of the Lahore High Court in B.N. Kashyap v. Emperor AIR 1945 Lah 23 : (1945) Cri LJ 296), in support of his contention that the judgment of the civil Court on certain facts in action in personam is not relevant before the criminal Court when it is called upon to give findings on the same facts. A Division Bench of this Court in Laxmi Narain v. State of Haryana, Criminal Revision No. 245 of 1979, has also observed that where the concerned authority under the Punjab Co-operative Societies Act had given the award against the accused, criminal prosecution on the same facts is also maintainable. In that case, the Division Bench at page 10 of the judgment had observed as under:

"The civil liability of an accused who misappropriates an individual''s property or the property of an institution like the Cooperative Society etc. is based upon the right of such individual or institution to be reimbursed by such person to the extent of the misappropriated amount, while his criminal liability springs from the fact that the society at large is interested in seeing that the individuals constituting the society do not deviate from the right conduct and thus law envisages imposition of punishment, physical or otherwise, to deter such persons and others from doing so in future. It is for this reason that the State, which represents the society, takes upon itself the role of a prosecutor. Even when an individual upon whom the crime had been committed refrains from prosecuting the accused and even when he petitions that the accused should not be prosecuted, the State is not only not debarred from prosecuting the accused, but it is in law duty bound to initiate the criminal proceedings and punish the accused for the crime."

8. From the perusal of the above observations of the Division Bench, it can be well-inferred that although it was not specifically held that the judgment in rem on the civil side is only binding on the criminal Court regarding the same cause of action but obliquely it amounts to the same thing as the remarks that the criminal liability springs from the fact that the society at large is interested in seeing that the individuals constituting the society do not deviate from the right conduct and thus law envisages imposition of punishment, clearly spells out the same.

9. It appears that this aspect of the controversy whether the judgments in personam is binding upon the criminal Court on the same facts was not directly in issue before the Calcutta High Court in Rajendra Kumar Ruia''s case (supra) as well as before the Supreme Court in M/s. Karamchand Ganga Pershad''s case (supra). Admittedly, the proceedings before the Arbitrator u/s 56 of the Co-operative Societies Act are proceedings in personam as these are based upon the right of the individual Co-operative Society reimburse the loss incurred due to the misappropriation of the amount by the person concerned. The State being not a party to such proceedings, such like award cannot be treated as a judgment in rem.

10. Faced with the above referred difficulty, Mr. H.S. Gill, the learned counsel for the petitioner, tried to distinguish the findings of the Division Bench of this Court contending that in that case, the award has been given against the accused-petitioner, whereas in the case in hand, the accused-petitioner had been exonerated by the Arbitrator. It is further maintained that since the award of the Arbitrator is to be treated as decree, such decree will amount to be the decision of the civil Court. Mr. Gill also contended that the legal import of the awards rendered by the Arbitrator should be taken into consideration and not the reasons for such award. No doubt, the view of the Calcutta High Court in Rajendra Kumar Ruia''s case (supra) supports the contention of Mr. Gill, yet all the same, it is of no consequence as the perusal of the awards, copies Annexures P-2 to P-5 reveal that the present petitioners were not found to have embezzled the fertilizer loan but Mohinder Pal, Secretary of the Society, had done so in the dispute subject matter of awards, copies Annexures P-2 and P-3, while there was no embezzlement regarding the allegations subject matter of award, copy Annexure P-4, as Surinder Singh was the genuine person to whom the loan for fertilizer was advanced by the Society. The award, copy Annexure P-5, shows that Surender Kumar, Cashier, and Gurmail Singh, Salesman of the Society, were liable to pay the amount embezzled in that case. There is no indication from these awards regarding the present petitioners having conspired with their co-accused and Gurmail Singh aforesaid in the embezzlement of this amount by attesting the loan papers. On the other hand, the perusal of the awards, copies Annexures P-2, P-3 and P-5 as well as the extract of the audit report, copy Annexure P-1, reveal that the loans in these cases were sanctioned in favour of the persons who are not members of the Society or residing in the area of the Society or owning any land under the jurisdiction of that Society. If that is so, then the above referred awards are not of much relevance to exonerate the petitioners from the above referred charges, especially when the case is still under investigation.

11. Under those circumstances no interference is called for in the investigation of the case u/s 482 of the Code of Criminal Procedure. The petition stands disposed of accordingly.

12. The above observations will have no bearing on the final fate of the case.