- (1.) This is an appeal by special leave from a judgment of the Allahabad High court. The facts may be briefly stated: The appellant was the treasurer of government Treasury at Lakhimpur, District Kheri, in the State of Uttar Pradesh and the respondent as a body incorporated under Section 18 of the U. P. Co-operative Societies Act, 1912 (Act 11 of 1912) , hereinafter called the Act, carried on the business of banking at that place. According to the bye-laws of the Bank an Honorary Treasurer was elected who held the office for a year. A sum of Rs. 10,000. 00 was kept deposited with me Treasurer for disbursement on the Bank's account. When the appellant was re-elected as Honorary Treasurer in 1946 he represented that he did not have sufficient time to carry out the responsibilities of the post himself and he could act through his nominee only. It is stated that with the concurrence of the authorities of the Bank and with their knowledge one Mool Chand was nominated to act on his behalf. It appears that a good deal of money was embezzled from the Bank and on 12/12/1952 the Managing Director lodged a report with the police. After investigation Mool Chand and Hazari Lal the Manager of the Bank were challaned. The Managing Director reported the matter to the Deputy Registrar, co-operative Societies, U. P. A meeting of the Board of Directors was called for 18/12/1952 which was attended by the Deputy Registrar Shri Pant. According to the appellant Shri Pant stated at the meeting of the Board of Directors that the appellant being a Treasurer was liable to make good the loss and in case some difficulty was felt the matter might be referred to him according to the provisions of Rule 15 of the U. P. Co-operative Societies Rules, 1936 and be would pass a decree in favour of the respondent on the following day. A claim was filed with Shri Pant the same afternoon and the summons served on the appellant in the evening on the same date. It was alleged that on the following day in spite of the appellant having submitted to Shri Pant that a copy of the claim had not been served on him with thesummons and that the time was too short to enter upon the defence Shri Pant made an award in the sum of Rs. 1,04,319-7-4 against the appellant.
(2.) The appellant filed a suit on 8/01/1953 for a declaration that the award, dated 19/12/1952 made by Shri Pant the Deputy Registrar, Co-operative Societies was ultra vires and therefore void. This suit was decreed by the Trial court on 24/08/1957. When the matter came before the High court on appeal filed by the respondent a division bench referred the question of the validity of Rule 115 of the Rules which had been canvassed to a larger bench. The full bench upheld the validity of the aforesaid Rules. The division bench by an order, dated 18/01/1966 allowed the appeal and set aside the decree passed by the first court. The result was that the appellant's suit was dismissed.
(3.) Counsel for the appellant sought to raise a number of points before us but the controversy was confined to two matters only and it was agreed that no other question required determination. The first point was that the Deputy Registrar had gathered information relating to the alleged embezzlement behind the back of the appellant and had based the award on that information apart from other evidence. The second was that there had been a complete failure to afford a proper opportunity to the appellant to defend himself and properly present his case.;