IN THE HIGH COURT OF ORISSA AT CUTTACK

W.P.(C) No.10228 of 2006

Ramesh Chandra Pani …. Petitioner

Mr. Manoj Kumar Mohanty, Advocate

-versus

State of Orissa and others …. Opposite Parties

Mr. S. N. Das, ASC and 

Mr. A. Mohanty, Advocate for Opp. Party No.2

 CORAM:

 THE CHIEF JUSTICE

 JUSTICE R. K. PATTANAIK 

ORDER

07.03.2022

Order No.

 Dr. S. Muralidhar, CJ.  

08. 1. The present petition has been filed challenging two orders,  one is an order dated 12th August 2004 passed by the Directorate  of Textiles, Orissa ordering that a sum of Rs.14,16,442.40  pursuant to an Award dated 1st November 2003 of the Arbitrator,  Directorate of Textiles, Orissa is recoverable from the Petitioner  and ordering that recovery from his salary under Rules 182 and  183 of the Orissa Treasury Code (OTC) commencing from the  month of August 2004 till his retirement. 

2. The further challenge in the present petition is to an order dated 17th April 2006 of the Orissa Administrative Tribunal  (OAT), Bhubaneswar in O.A. No.1028 of 2004 whereby the  application filed by the Petitioner challenging the above  recovery order was dismissed. The OAT held that the absence of

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any attachment order by a Court of Law as required under Rule  182 of the OTC was a ‘mere technicality’ and that sufficient  opportunity has already been granted to the Petitioner to pay the  amount awarded against him. What weighed with the OAT was  that the Petitioner never challenged the award which was passed  after he had contested the claim.

3. The background facts are that for the period between 23rd April 1984 and 1st August 1989, the Petitioner worked on  deputation with the Orissa State Handloom Weavers’ Co Operative Society Limited, Bhubaneswar (Society). According  to the Petitioner, long after he was repatriated to his parent  Department in the Government of Odisha, he was informed that  some shortage was detected on the basis of an audit report  concerning the Society and the shortage was in the sum of  Rs.7,92,046.08, which was liable to be recovered from him.

4. The dispute that ensued was referred to the Arbitrator under  Section 68 of the Orissa Cooperative Societies Act, 1962 (Act)  and was registered as Dispute Case No.2 of 1997. The Petitioner  contested the case by appearing before the Arbitrator and making  his submissions. On 1st November, 2003, the Arbitrator delivered  a judgment/Award holding that the Society was entitled to  recover from the Petitioner the aforementioned sum together  with the interest @12% per annum from the date of filing of the  dispute till the date of its realization.

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5. On 22nd March 2004, the Secretary of the Society wrote to the  Petitioner stating that in terms of the above Award/ Judgment, he  was liable to pay the Society Rs.14,16,442.40 which included the  interest amount. When the Petitioner did not respond to the  above demand, the first impugned order dated 12th August 2004  was issued by the Directorate of Textiles, Orissa stating that the  above amount would be recovered from the salary of the  Petitioner under Rules 182 and 183 of the OTC commencing  from August, 2004.

6. The Petitioner then challenged the above order before the  OAT by filing OA No.1028 of 2004. Till the said petition was  disposed of by the second impugned order dated 17th April 2006  of the OAT, there was an interim stay granted by the OAT  restraining the Directorate of Textiles and Handlooms, Orissa as  well as the Society from making any recovery from the  Petitioner’s salary pursuant to the order dated 12th August, 2004.

7. When the present petition was listed before this Court on 14th August 2006, while directing notice to issue in the petition, this  Court ordered that no recovery would be made from the  Petitioner “otherwise than in accordance with law relating to the  execution of the award”. The said interim order is continuing till  date.

8. At the outset, Mr. Mohanty, learned counsel for the Petitioner  informs the Court that the Petitioner has since superannuated.

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The main plank of his submission is that without instituting a  proper execution proceeding, the Opposite Party- Society could  not seek to recover any amount from the Petitioner pursuant to  the Award in terms of Rule 182 of the OTC. Reliance is placed

on the decision of this Court in Swastik Agency v. State Bank of  India, 2009 (II) OLR 201. Mr. Moahnty also relied on the  decision in Competent Authority v. Barangore Jute Factory  (2005) 13 SCC 477 in which it was held that where a statute  required a particular act to be done in a particular manner, it had to be done in that manner alone.

9. Mr. Das, learned Additional Standing Counsel appearing for  the State-Opposite Parties points out that the Award dated 1st November 2003 became final. In other words, the Petitioner did  not question the Award which required him to pay the Society  over Rs.14 lakhs. Since the Petitioner made no effort to make  any payment whatsoever, the Society had to resort to recovery  by invoking Rule 182 of the OTC. In response to the plea that an

execution proceeding should have been instituted, Mr. Das  points out that throughout there has been a stay of further steps  to be taken by the Society, first by the OAT and then by this  Court. Therefore, there was no occasion for execution  proceedings to be filed by the Society.

10. The above submissions have been considered. In the first  place, it must be noted that the Award dated 1st November 2003  is categorical regarding the liability of the Petitioner to make

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payment to the Society of the principal sum of Rs.7,92,046.05  together with the interest @12% per annum. The Petitioner does  not dispute that as on as 22nd March 2004, he was liable to pay  the Society Rs.14,16,442.40. Even today before this Court Mr.  Mohanty did not even for a moment suggest that the Petitioner is  not liable to pay the Society the aforementioned sum. The  burden of his song is only about the procedure. He repeatedly  urged that without filing an execution proceeding, no step could  be taken by the Society to recover even one paisa.

11. The fact of the matter is for nearly 18 years now and the  Petitioner has succeeded in avoiding to make any payment  towards the liability of Rs.14,16,442.40 which together with  further interest calculated from that date would indeed be a very  substantial sum. The Petitioner has superannuated in the  meanwhile. Mr. Mohanty glibly states before the Court that he  does not know what the net worth of his client is.

12. The Court exercising jurisdiction under Article 226 of the  Constitution is also a Court of equity. It will have to be mindful  of the interests of justice and ensure that in rigidly applying  technical rules of procedure miscarriage of justice does not  result. A handloom weavers’ cooperative society which is owed over Rs.15 lakhs for over eighteen years has been rendered  helpless in seeking to recover even a tiny fraction of the said  amount an account of successive interim orders passed first by  the OAT and then by this Court. There was no corresponding

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burden on the Petitioner to deposit at least some part of the said  amount as a condition for stay to be granted. Meanwhile, the  Petitioner has superannuated and the Court is not informed what  his present assets are.

13. Turning to the decisions cited by the Petitioner, it is seen that  in Swastik Agency v. State Bank of India (supra), the case arose  under the Securitization and Reconstruction of the Financial  Assets and Enforcement of Security Interest (SARFAESI) Act,  2002. What appears to have weighed with the Court was that the  property which was put to auction for recovering the dues of the  Bank appeared to have been greatly undervalued. This is  apparent from the following observation:

“71. It is evident that the property has been assessed  at Rs.4.15 lakhs and reserve price was fixed at  Rs.3.95 lakhs, but it has fetched the value to the tune  of Rs.13.95 lakhs. The difference between the value  assessed and value received is more than three times.  Therefore, even by stretch of imagination, it cannot  be held that the valuation has been made correctly. As  a consequence reserve price had been fixed at a lower  side and auction on the basis of such report cannot be  held to be fair and reasonable as large number of  persons who might have indulged in purchasing  property of higher value like instant, had been misled  and they did not participate. Thus the auction sale is  stood vitiated.”

14. Even while the Court in the said case set aside the auction  sale it put the Petitioner there to terms as it should have while  exercising its jurisdiction under Article 226 of the Constitution.  It specifically required the Petitioner to deposit the re-computed

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demand from the Bank within four weeks from the date of  receipt “failing which the bank shall be at liberty to proceed  against the Petitioner for making full recovery of its outstanding  dues in accordance with law.” Therefore, even when the Court  detected a procedural illegality, the relief was moulded to ensure  that equities were balanced and that the defaulting party viz., the  Petitioner in that case was not allowed to escape liability by not  making any payment whatsoever. 

15. The decision in Competent Authority v. Barangore Jute  Factory (supra) was in the context of acquisition of land under  the National Highways Act, 1956. A notification which specified  a plot number, a part whereof was intended to be acquired, did  not specify that part. It is in that context that it was held that the  notification stood vitiated. The Court fails to appreciate how the  said decision would come to aid of the Petitioner in the present  context which has been outlined hereinbefore. 

16. Even today, the Petitioner is not prepared to even make a  statement about discharging the humongous liability he owes to  the Cooperative Society. The Petitioner has avoided the admitted  liability for over eighteen years now. Under Article 226 of the  Constitution, the Court does not consider it to be a balance of  equities to simply quash the impugned orders requiring recovery  to be made from the Petitioner.

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17. From the submissions of Mr. Das, learned Additional  Standing Counsel, it appears that Opposite Parties are conscious  of the requirement of having to comply with Rule 182 of the  OTC and it is only because of the interim order of this Court that  those steps were not taken. 

18. In the circumstances, the Court sees no reason why it should  interfere either with the order dated 12th August 2004 or  subsequent order dated 17th April 2006 of the OAT. The interim  order dated 14th August 2006 stands vacated. The writ petition is  dismissed. But, in the circumstances with no order as to costs. 

 (Dr. S. Muralidhar)   Chief Justice

  (R. K. Pattanaik) 

 Judge

S.K. Guin

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