Gopal Prasad vs Birbahadur Singh & 2 Ors

This revision petition has been filed by the petitioner Gopal Prasad against the order dated 21.08.2017 of the State Consumer Disputes Redressal Commission, Bihar, (in short 'the State Commission') passed in Appeal No.431 of 2013.

Brief facts of the case are that the petitioner is the former elected Chairman of the Primary Agriculture Cooperative Society. Two cheques of Rs.2,25,000/- and Rs.25,000/- were issued to the respondent No.1/complainant by the society. The cheque of Rs.25,000/- was enchased. However, the cheque of Rs.2,25,000/- was returned unpaid due to insufficient money in the account of the Society. Respondent No.1 filed a consumer complaint bearing No.61/2011 before the District Consumer Forum, Gopalganj, (in short 'the District Forum') and the same was allowed vide order dated 13.08.2013 passed by the District Forum, wherein both the opposite parties i.e. the petitioner/Chairman of the Society and the Manager/Secretary of the Primary Agriculture Cooperative Society were jointly and severally directed to pay the amount.

Aggrieved by the order of the District Forum, the petitioner herein preferred an appeal bearing No.431 of 2013 before the State Commission. However, the State Commission did not allow the appeal in his favour and maintained the order of the District Forum against the petitioner herein.

Hence the present revision petition.

Heard the learned counsel for the petitioner at the admission stage. Learned counsel for the petitioner stated that the petitioner was a former elected Chairman of the Primary Agriculture Cooperative Society and he was not responsible for day to day affairs of the account keeping, which was the sole job of the Manager of the Society. The account is maintained by the Manager, however, the cheques are signed by the Chairman as well as by the Manager jointly. Learned counsel further stated that as per the provisions of Section 34 of the Bihar Cooperative Societies Act, the Manager under the supervision and control of the Managing Committee shall be responsible for security and maintenance of the papers relating to the assets including cash and stock of the Society. Thus, it is very clear that it was the Manager, who should have been made responsible for paying the amount and not the Chairman.

Learned counsel for the petitioner further stated that the petitioner has already lodged an FIR against the Management/Secretary of the Society for embezzlement and therefore, Chairman cannot be made responsible for the acts of embezzlement done by the Manager.

I have given a thoughtful consideration to the arguments advanced by the learned counsel for the petitioner and have examined the material on record. First of all, the Chairman is heading the Management Committee also. Moreover, under Section 28 of the Bihar Cooperative Societies Act, it is clearly mentioned that the Chairman will exercise general supervision over all activities of the Society. Furthermore, even under Section 34 dealing with the powers and duties of the Manager, it is clear that the Manager will perform these duties under the general directions of the Management Committee and under the control of the Chairman. From these provisions, it is clear the Chairman cannot dissociate himself from the financial actions and activities of the Society and particularly when he is signing the cheque as a joint signatory with the Manager. The involvement of the Chairman as a joint signatory perhaps has been kept to insure that the Manager does not have unfettered power in respect of issuing the cheques. As a senior functionary of the Society, the Chairman is supposed to exercise direct supervision over financial activities and particularly, if he is signing a particular cheque. He should have insured that the account of the Society had sufficient funds.

Even under the Negotiable Instruments Act, 1881, the signatory of the cheque is responsible if the cheque amount is not paid and the cheque is bounced. From this angle also, the Chairman cannot escape the responsibility from compensating the complainant.

Based on the above discussion, I find no merit in the revision petition filed by the petitioner against the order dated 21.08.2017 of the State Commission, which could justify any interference from this Commission. Accordingly, the RP No.883 of 2018 is dismissed at the admission stage.