1980 PLP 699 (SCMR)

Nemo for Respondent. Date of hearing : 4th March, 1980. NASIM HASAN SHAH, J.‑This is a petition for special leave to appeal against the judgment of a learned Single Judge of the Lahore High Court dated 8th May. 1979 dismissing the Civil Revision Petition (C. R. P. 205/76) filed by the petitioner. The relevant facts are that the petitioner‑bank was carrying on business at Sheikhupura and registered with the Registrar of Cooperative Societies, Punjab. Later on, the Bank was dissolved and it is now function ing in the name and style of Punjab Provincial Cooperative Bank Ltd, Sheikhupura Branch. The petitioner was appointed to act as its treasurer for the whole of District Sheikhupura in 1953 by the respondent. The said district has a District Treasury at Sheikhupura and two Sub -Treasuries; one at Ferozewala and other at Nankana Sahib. After the said appointment, the petitioner executed an agreement dated 25th November, 1955 in favour of the respondent by virtue of which, among other things, he undertook to indemnify the defendant for any loss or embezzlement etc. which might occur in the Government money etc. in the District Treasury and the Sub‑Treasuries. One Zaheeruddin, an employee of the petitioner worked as Sub‑Treasurer in the Ferozewala Sub‑Treasury for a period of more than 10 years and after his transfer, he was detected by the Sub‑Treasury Officer, Ferozewala for defalcation of the amount of Rs. 6,17,

000. A case was 'registered against said Zaheeruddin under section 409, P. P. C. and it was discovered that Zaheeruddin had committed the defalcation of the amount at different occasions during the period from 1961 to 1966. He also made a con fessional statement on 15th June, 1966 before the Magistrate Ist Class disclosing the commission of the defalcation of the amount by him at different occasions during the aforesaid period for 5/6 years. Ultimately the petitioner was convicted by the Military Court and sentenced. An amount of Rs. 89,000 was recovered by the police and stands deposited in the Government Treasury. After the said conviction and sentence of Zaheeruddin, the Collector, Sheikhupura District, issued a show‑cause notice dated 19th September, 1972 to the petitioner to explain within 14 days of the receipt of the said notice as to why the said defalcated amount of Rs. 6,17,000 plus interest due thereon should not be recovered from the petitioner as arrears of land revenue in terms of the aforesaid agreement dated 25th November, 1955 whereby the petitioner had undertaken to indemnify the defendant for any loss or embezzlement etc. in the Sub‑Treasury. The petitioner contested its liability but the Collector, Sheikhupura vide his order dated 12th May, 1973 held the petitioner liable for the defalcation and forfeited the security rendered by the petitioner which was pledged in favour of the Collector/ D. C. Sheikhupura. The petitioner challenged the said order dated 12th May, 1973 bf the Collector before the Commissioner, Lahore Division, in appeal but the same was rejected on 29th September, 1973. Thereafter, the petitioner filed a suit on 1st September, 1973. Along-with the suit, an application was also filed under Order XXXIX, rules 1 and 2 for issuance of a temporary injunction restraining the respondent from realising from the petitioner the amount of defalcation of Rs. 6,17,000 pending decision of the suit. The learned trial Court rejected the application for temporary injunction vide its order dated 5th March, 1974. Against the said order, the petitioner filed an appeal before the Additional District Judge, Sheikhupura which, too, was dismissed on 24th February, 1976. The petitioner,‑then, challenged the aforesaid order/judgment by a civil review petition (C. R. P. 205/76) which was dismissed by a learned Single Judge of the said Court vide order dated 8th May, 1979. The main plea raised before the High Court and repeated before us was that there were detailed rules in the Subsidiary Treasury Rules and the Punjab Finance Rules which provide for a double lock system maintenance of one key by the Treasury Officer/Sub‑Treasury Officer, details (inspection of the Treasury or Sub‑Treasury by Government Officers including the Collector/Treasury Officer/Sub‑Treasury Officer and also personal responsibility of the Treasury Officer. These officers had failed to carry out their duties and in these circumstances, the petitioner, who was the principal of the agent against whom the defalcation charge had been found correct could not be held responsible for this amount. The learned Judge in the High Court in rejecting this contention observed that it may be that the petitioner was a principal of Zaheeruddin but the petitioner was himself an agent of the plaintiff. This Treasury was given on contract to him on his entering into an agreement dated 25th November, 1955 by which he took the responsibility of making good the loss that the Government might suffer on account of an embezzlement of misappropriation by any employee of the plaintiff. In these circumstances, the only question that may arise is whether the loss was suffered on account of lack of control or otherwise. That is a question that cannot be decided at this stage and will require substantial evidence. Prima facie, the plaintiff is responsible for making less of the Government on the admitted facts. Therefore, be bas a prima facie case entitling him to grant him a temporary injunction. We de not think that the above view is misconceived and requires any interference. The grant of interlocutory injunction being in the discretion of the trial Court and upheld by the Appellate Court the same could have been interfered with by the High Court only if the Additional District Judge or the trial Judge has acted illegally or with material irregularity in the exercise of their jurisdiction which was not the case here. Consequently, no ground for interference exists. Mr. Mohammad Ilyas Khan, learned counsel for the petitioner, tried to raise a new point that the Punjab Provincial Cooperative Bank was not liable for the debt in dispute and could not, therefore, be proceeded against in connection with the aforesaid defalcation. In this connection, we may simply observe that the petitioner may amend his suit which is still pending so as to take above legal defence, if such amendment is permissible under the law. This petition, with the above observation, is hereby dismissed. Petition dismissed.