“2. The appellant is a cooperative society registered under the provisions of the Tamil Nadu Cooperative Societies Act, 1961. Respondents 1-14 were for the year 1974-75 members of its Board of Management. An enquiry under Section 65 of the said Act into the affairs of the appellant-society was ordered by the Deputy Registrar of Cooperative Societies on 26-9-1976 in relation to sales and purchases of Cholam and Ragi. The inquiry report revealed that there had been a loss in the business of Cholam and Ragi during the said year in the sum of Rs 1,31,990.33; that the amount of Rs 6661 had been paid in excess of the prevailing market rate of Ragi; and that a loss in the sum of Rs 8638.35 had occurred due to reduction in retail prices. Accordingly, surcharge proceedings were initiated by the Registrar of Cooperative Societies against Respondents 1-14 under the provisions of Article 71 of the said Act, which makes members in management of a Cooperative Society liable in the event of wilful negligence. In these proceedings the Registrar found Respondents 1-14 liable to pay the sum of Rs 1,23,350.98, with interest thereon at the rate of twelve-and-a-half per cent per annum from the date of his order till the date of realisation, to the appellant society. Respondents 1-14 preferred appeals to the Special Tribunal for Cooperative Cases, which dismissed the appeals.
