Allowed

Haim Singh v. State of Haryana & Ors.

Punjab & Haryana HC5 Jan 2012CWP/5293/2009

Case brief

AI extract

What is this about?

Petitioner challenged an arbitration award and subsequent revisional order in a dispute arising between two employee-members of a cooperative society regarding alleged embezzlement. The Court held that inter se employee disputes do not fall within the arbitration ambit of the Act and quashed the orders.

What did the court decide?

The writ petition is allowed, and the impugned orders dated 18.07.2007 and 12.01.2009 are quashed with no order as to costs.

Haim Singh Vs State of Haryana & Ors. — Cooperative Societies | Punjab & Haryana HC (2012)

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CWP No.5293 of 2009

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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH

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CWP No.5293 of 2009 Date of Decision: 05.01.2012

Haim Singh, Salesman

..... Petitioner

Versus

The State of Haryana, through Special Secretary to Government of Haryana Cooperation Department, Chandigarh and others

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..... Respondents

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CORAM:- HON'BLE MR. JUSTICE RAJIV NARAIN RAINA

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Present: Mr. R.D. Gupta, Advocate, for the petitioner.

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Mr. A.P. Setia, Advocate, for respondent No.5.

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Mr. S.S. Antal, Advocate, for respondent No.6.

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To be referred to the Reporters or not?

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Whether the judgment should be reported in the Digest?

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RAJIV NARAIN RAINA, J.

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The challenge in this petition filed under Articles 226 and 227 of the Constitution is to the Arbitration Award dated 18.07.2007 passed by the Assistant Registrar, Cooperative Societies, Ambala acting as an Arbitrator under Section 102 of the Haryana Cooperative Societies Act, 1984 (for short 'the Act') directing the petitioner Haim Singh, Salesman to pay an amount of Rs.1,61,500/- along with 18% interest within a period of one month and for quashing the impugned order dated 12.01.2009 passed by the

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CWP No.5293 of 2009

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Special Secretary to Government of Haryana, Cooperation Department, Chandigarh exercising revisional jurisdiction against the order dated 18.07.2007.

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The short issue involved as projected by the learned counsel for the petitioner is that an inter se dispute between two employees would not form subject matter of arbitration proceedings under the Act. Arbitration disputes under the Act are envisaged and contemplated between a society and a member/s but not disputes between two employees i.e. the petitioner and one Gulab Singh – respondent No.5. The short facts necessary for adjudication of this matter are that the petitioner was working as a salesman under the control and supervision of the Manager of the respondent Society namely Sh. Gulab Singh during the year 2007. In the year 2007, objection was raised in the audit report when audit was carried out by the Audit Department that they had been an embezzlement of a sum of Rs.1,61,500/during the year 1992-93 when both the petitioner and said Gulab Singh were working together in the society. It is the petitioner's case that he has been unlawfully saddled with payment of amount of Rs.1,61,500/- and that this amount stood duly paid to the society and further to the respondent – Bank.

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Learned counsel for the petitioner has pointed out from the written statement filed by respondent No.5 – Gulab Singh an admission that being in charge of the society he was made to deposit the said amount by the Divisional Officer of the Bank and a verbal understanding was reached between the petitioner and the respondent No.5 that the latter will make the payment to the Society within a short period and as a guarantee to this

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CWP No.5293 of 2009

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promise he agreed to sign a payment voucher of the same amount to be shown as advanced to him in case he does not pay the same. It is not disputed that no financial loss has been occasioned either to the society or to the bank by the events of 1992-93. Respondent No.5 has remained silent all along having once made good the amount of embezzelment. If there was a verbal understanding between the petitioner and respondent No.5 then it would be a personal and private dispute between them which has nothing to do with the respondent Society and the respondent Bank.

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I have heard learned counsel for the parties at length. Learned counsel for the petitioner has relied upon a decision of this Court reported in Nanak Chand, Inspector Cooperative Societies, Sohna, Distt. Gurgaon v. State of Haryana, 1997(2) R.C.R. (Civil) 408 to contend that arbitration under the cooperative law is not permissible viz-a-viz an inter se dispute between employees. It may or may not be that the petitioner had or had not embezzled money in the year 1992-93. The remedies against such action could have been both criminal and civil. The society was not a complainant. The alleged embezzlement came to light in 2007. Respondent No.5 sat back happily from 1992-93 without claiming the amount from the petitioner. I pointedly asked Learned counsel for respondent No.5 as to his client's silence throughout this period but he had nothing to offer by way of explanation. I feel that both the petitioner and respondent No.5 cannot be said to be above-board. But, it is not possible for this Court to consider seriously disputed questions of fact between them. Yet what remains at the end of the day, in my considered view, is that the arbitration proceedings initiated and concluded under the Act were wholly nonest and ab initio

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CWP No.5293 of 2009

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void. Consequently, I have no hesitation in quashing both the impugned orders as being misdirected and suffering from inherent lack of jurisdiction. I would leave the private parties to seek remedies, if any, available to them against each other in accordance with law.

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The learned counsel for respondent No.6 - Bank did not dispute that no financial loss had been occasioned to the Bank and that the dispute was essentially a private dispute without any public law element involved therein.

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In view of the above, the writ petition is allowed. The impugned orders dated 18.07.2007 and 12.01.2009 are hereby quashed with no order as to costs.

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05.01.2012 manju

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(RAJIV NARAIN RAINA) JUDGE

Haim Singh v. State of Haryana & Ors.

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Haim Singh v. State of Haryana & Ors.

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