1. (28th June 1938).- This appeal arises out of a suit for damages : (a) for malicious prosecution, and (b) for wrongful dismissal from service. There are nine defendants to the suit. Defendant 1 is the Chatra Serampore Co-operative Credit Society, a Society established under the Co-operative Societies Act and carrying on banking business. The plaintiff Becharam was the Manager of the Society. He was dismissed on the 29th May 1929. Defendant 2 Bhupendra is a Government Inspector of Co-operative Societies. He was appointed Manager of the Society with the consent of the Registrar of Co-operative Societies for 6 months in the place of the plaintiff, and discharged his duties as such in addition to his own duties as Inspector. Defendants 3 to 9 were some of the members of the Managing Committee of the Society at the material time. The claim for damages for malicious prosecution is against all the defendants, and the other claim is against defendant 1, hereafter to be called the Society. In the plaint damages for malicious prosecution have been assessed at Rs. 2600 being made up of Rs. 2200 said to have been incurred as out of pocket costs by the plaintiff in defending the criminal cases started against him and Rupees 400 on account of his suffering in mind, body and reputation by reason of the prosecution. Damages for wrongful dismissal have been assessed in the plaint at Rupees 7500, Rs. 6663 being for loss of pay from 29th May 1929 to 4th June 1931, when the plaintiff was acquitted of the criminal charge, and Rs. 837 being the Society's contribution to his provident fund which was forfeited on his dismissal. The Sub-ordinate Judge upheld the plaintiff's contention, but reduced the claim for damages. He awarded Rs. 1928 as damages for malicious prosecution against defendants 1 and 3 to 9, defendant 2 being absolved from liability, and Rs. 1662 which represents a sum total of three months pay at Rs. 275 a month and the aforesaid sum of Rs. 837, as damages against the Society for wrongful dismissal. Defendants 1 and 3 to 9 have preferred this appeal. The plaintiff has filed a memorandum of cross-objection. He has not sought therein to make Bhupendra (defendant 2) liable, but has asked for mere damages against the Society for wrongful dismissal.
2. The prosecution against him was started on a letter which Bhupendra handed to the Sub-Divisional Magistrate on 25th April 1929 and was treated on 26th April 1929 as a first information report (Ex. BB, paper-book, Part II, p. 749). He was sent up before the Magistrate with Jiten, the accountant of the Society, on 17th May 1929 on a charge under Sections 477.A and 120 B, I.P.C. Another case under Section 409, I. P. C, was also started against him, but that case was not tried on the merits, the proceedings having been quashed by this Court on a reference from the Sessions Judge after his acquittal on the first mentioned charges. The subject-matter of the first mentioned charges was entries in the fair cash book of the Society in respect of six sums of money, namely Rs. 1462-9-6, Rs. 221-15-3, Rs. 297.10-9, Rs. 25, Rs. 31.4-0 and Rs. 18-12.0. After preliminary investigation by the Magistrate, he and his co-accused were committed to the Sessions, but this Court quashed the commitment order on the ground that the offences charged were not exclusively triable by the Court of Session, and directed that they be tried by the Magistrate. The Magistrate convicted the plaintiff and Jiten under Sections 477-A and 120-B, I.P.C., on 23rd May 1930, (Ex.FF; II-796) and sentenced the plaintiff to two years' rigorous imprisonment. On appeal the learned Sessions Judge acquitted both on 4th June 1931, (Ex. 1; II.806). Jiten had not filed any suit for damages. The questions in this appeal are:
(i) Was the criminal law set in motion against Becharam, the plaintiff by defendants 1 and 3 to 9 or any one of them? (ii) Was there any reasonable and probable cause for the prosecution? (iii)' Did any of the said defendants act with malice? and (iv) Was the plaintiff's dismissal wrongful. The question raised in the cross-objection is whether the plaintiff is entitled to damages on the ground of loss of pay till the date of expiry of six months leave previously granted to him, i.e. for an additional period of three months and 10 days from 29th May to 8th December.
3. Before we take up these points specifically, it is necessary to give a short account of the plaintiff's career and of the affairs of the Society till the prosecution was started against him. In 1914 the plaintiff was a teacher of a local school at Serampore. He subsequently became its head-master and continued to be so till 1926. In 1914 he became a member of the Society, and in 1915 a member of the Managing Committee, which position he filled till the middle of the year 1923. Prom 16th September 1915 to 22nd June 1923 he was the Honorary Secretary and Treasurer, but honorary in name only from 1920, for since then he was given allowance first at the rate of Rs. 600 and then at the rate of Rs. 1200 a year. For the greater part of this period the business of the Society was on a comparatively moderate scale and all the members of the staff were honorary workers. For general supervision and management there was a Board called the Managing Committee, one member of which committee was annually elected Secretary. There was a sub-committee formed from among the members of the Managing Committee, which was called the Working Committee, and its function was to scrutinize applications for loans by members of the Society and recommend them for sanction by the Managing Committee. The plaintiff was a member of this Working Committee so long as he continued to be a member of the Managing Committee.
4. In 1923 he was re-elected a member of the Managing Committee, but the Registrar of Co-operative Societies, 'Bengal, vetoed his election, apparently on the ground that he had been too long on the Committee. This veto made it impossible for him to continue as Secretary. The Society however considered that it could not lose his services, as he was at the helm of its affairs for a long time, and during his time the volume of business had increased largely if not wholly, through his exertions. The Managing Committee therefore found a way to get round the Registrar's veto. A (resolution was passed on 22nd June 1923, [Ex. 2 (q); II. 20] by which another member of the Managing Committee, Mr. Bhattacharya, was appointed Honorary Secretary in his place, and he was appointed 'Manager' from 23rd June 1923 with powers to receive and disburse moneys and to sign all papers and documents on behalf of the Society. His pay was fixed at Rs. 100 a month by a resolution of the said Committee passed at the next meeting. As these resolutions involved a financial obligation, the plaintiff's appointment had to be brought to the notice of the members of the Society assembled at an ordinary .general meeting under bye-law 22 (5), and by a resolution dated 27th January 1924 passed at such a meeting, the members confirmed the action of the Managing Committee in appointing him at a pay of Rs. 100 a month [Ex. 2 (u); II-26]. He got an increment in his salary of Rs. 25 in June 1925, and another increment of Rs. 25 in June 1926. Up to December 1926, he was a part-time officer of the Society. Prom January 1927 he was made a whole time officer with an increment pay of Rs. 250 [Ex. (2); II-37], and this again was raised from April 1927 to Rs. 275 a month.
5. During the time that he was whole time manager, there was a run on the Society. The run ceased admittedly in the early part of 1928, but the time of its commencement and its cause are matters of controversy. We shall hereafter record our findings thereon. The plaintiff's case is that he had to meet this run single handed, and the strain involved told on his health. He actually applied on grounds of ill. health for six months' leave in September 1928. This was refused on the ground that he could not be spared at that time. A second application made in October 1928 met with the same fate [Ex. 2 (z-16) and 2 (z-17); II-50]. He again renewed his application in January 1929, and this time it was granted by the Managing Committee, leave on full pay being sanctioned for six months with effect from 1st February 1929, Ex. 2 [z-18) II-52]. By the same resolution the Registrar of Co-operative Societies was re-quested to depute an experienced officer of his department to officiate as manager. On the 30th January 1928, Bhupendra, an Inspector of Co-operative Societies, whose jurisdiction was not Serampore where the Society was located but Hughli Sudder, was selected by the Registrar, He could not however take over charge on 1st February. He did so on 9th March following, and from that day plaintiff availed himself of his leave. At the time of taking over charge, Bhupen found the fair cash book had not been signed by the plaintiff, and on his insisting on his signing before he made them over, the latter refused to do so. The matter was brought to the notice of the Managing Committee, which by a, resolution dated 14th March 1929 deter-mined that as the cash books had not been written up from day to day and the plain tiff had no opportunity to check them, it would not be fair to hold him responsible for them. [Ex. 2 (z-22); II-59], This was a unanimous resolution and showed that the Managing Committee was treating the plaintiff with the utmost consideration up to that date. They believed up to that time in his honesty.
6. The audit of the Society's accounts for the year 1926.1927 was made by the Government Inspector P.C. Mazumdar. During the year under audit, he found a sum of Rs. 1462-9-6 shown in the fair cash book as deposited under suspense account on 31st July 1926 (II-573). It was shown in next year's account as withdrawn on 31st May 1927 (II-591). He apparently called for an explanation from some officer of the Society. The explanation as given was noted in his balance sheet, viz. that the amount represented interest due to depositors which had not been paid out to them up to 31st July 1926, and so had been kept in suspense account, but it was according to their directions later on treated as their investments and so adjusted to loan account on 31st May 1927. (Ex. E; II-711). As the withdrawal entry fell within the next year's audit which was done later by another Government Inspector, Provash Chandra Pathak, this officer naturally looked into this item. There being no vouchers in support of the said entries, he regarded them as suspicious and brought them to the notice of Mr. Sandel, the Chairman of the Managing Committee, towards the middle of February 1929, and in his presence Mr. Sandel asked Jiten, the accountant to explain. Jiten prevaricated and was then and there suspended till he offered a satisfactory explanation (Ex. M. II-736). This was on 15th February 1929. Next day the plaintiff was called to explain the entries, but he pleaded want of knowledge [Ex. M(2); II-738].
7. On 17th February 1929 Jiten submitted a written explanation in which he stated that both the entries were fictitious, having been 'made simply to adjust mistakes in totals ' (Ex. M (1): (II-737). Mr. Sandel forwarded this explanation to the plaintiff with a request that it might be sent to Pathak with his report. The plaintiff never made his report, and Pathak has stated on oath that he found Jiten's explanation to be false, as there were no mistakes in total in the fair cash books. Jiten's explanation was moreover inconsistent with the explanation given to P.C. Mazumdar a year earlier as noted by him in the balance sheet. Pathak completed his audit in February 1929, and on his own responsibility and without any request from any member of the Managing Committee started a prosecution against Jiten on 2nd March 1929. Up to this time no suspicion arose against the plaintiff, but in course of further investigation by Pathak the latter detected what according to his opinion were cases of gross neglect of duties and mismanagement by the plaintiff. These were brought to the notice of the Managing Committee which passed resolutions thereon. Later on, on 20th April 1929 the cashier was examined before the Managing Committee, and Pathak pointed out other entries in the fair cash books. The proceedings of the meeting of the Managing Committee dated 22nd April 1929 (Ex. A-14; II73) are very important, because it was followed by certain action on the part of Bhupen which resulted in the plaintiff's prosecution.
8. We now take up for consideration the plaintiff's claim for damages for malicious prosecution, and we shall deal with that claim under the following heads : (a) was there reasonable and probable cause for his prosecution; (b) was the prosecution actuated by malice? and (c) who was responsible for the prosecution? Up to 30th March 1929, none of the members of the Managing Committee had any reason to believe that the plaintiff was in any way concerned directly or indirectly with any criminal offence. Pathak believed that Jiten only was concerned in what he considered to be fraud. The resolution of the Managing Committee dated 30th March 1929 (Ex. A. 18; II-63) called upon the plaintiff to submit written explanations for acts which were mere acts of mismanagement. There was no breath of suspicion then that he was concerned with what appeared to be the frauds of Jiten. The Managing Committee on further reports from Pathak started a more comprehensive enquiry from about the 7th April. The case against the plain-tiff was considered at the meeting of the 7th April, and more fully at the meetings of 20th April and 22nd April 1929. The members of the Managing Committee had before them the statement of the cashier Haradhone, and Pathak pointed out to them many irregular entries from the fair cash books. Among these entries was an entry of Rs. 297-10-9 shown as paid for law expenses. There was no voucher from the law clerk. The latter was examined and he denied receipt of the same. The entry was in Jiten's handwriting. On the materials thus placed before the committee, any prudent man would be justified in believing honestly that Jiten was guilty of falsifying accounts dishonestly and liable to be punished under Section 477-A, I.P.C.
9. There were other suspicious entries in regard to other items in the handwriting of Jiten. Pathak also drew the attention of the members of the Managing Committee to various other entries in the rough and fair cash books, and pointed out the discrepancies between these two sets of books. Many entries appearing in the rough cash books on the credit side representing money actually collected from debtors had not been posted in the fair cash books on corresponding dates, and the cash balances appearing in the fair cash books were less than those appearing in the rough cash books. Many of these entries in the fair cash books were in the plaintiff's hand writing. The rough cash book was written up from day to day. Every transaction was entered contemporaneously, but it was an unauthorized book. The fair cash book was the Society's authorized book. The statements of Pathak, who was an experienced Government auditor, an independent man, who had no motive to do the plaintiff an unmerited wrong, was bound to carry weight with any reasonable man. His statements, backed by entries from the fair cash books, could be reasonably taken as connecting the plaintiff with a criminal cons piracy with Jiten. Seven of the members of the committee were for sending at once an information to the police against the plaintiff, but nine were in favour of making further investigations through a sub-committee. Of these nine, one, Mr. Dhanapati Banerji, immediately after tie votes were recorded, felt that he had not done right in not voting with the seven.
10. Of the remaining eight, two at least, if not three, were partisans of the plaintiff and were prepared to shield him in any event. They are Kalidas Goswami and the plaintiff's nephew Haran Chandra Bose, both of whom have been examined as witnesses on his behalf. Their evidence is anything but satisfactory and discloses a strong bias for the plaintiff. The third man, Durga Das Roy, avoided attending a subsequent meeting, being apprehensive of his own arrest. He was the Secretary, and the mismanagement of the affairs of the Society was to a great extent due to his own laches and to his taking his duties as Secretary very lightly. On 25th April 1929 Bhupen and Pathak went together to the Sub-Divisional Magistrate with the letter attached to Ex. BB (II-750), written by Bhupen and signed by him as Manager of the Society and Inspector of Co-operative Societies. The police at the request of the Magistrate at once took up the matter. The conduct of the prosecution in the Court was later on placed in the hands of Mr. Krishna Mohan Bhattacharya, the Public Prosecutor. Krishna Mohan Babu has not been examined in the case, but there is only hearsay evidence coming from Mr. Sudhir Chandra Roy, who was later on appointed by the Crown to conduct the case in the Magistrate's Court, that Krishna Mohan Babu was unwilling to make the plaintiff an accused. This evidence is not admissible, and even if admissible has insignificant value. Mr. Sudhir Chandra Roy on being engaged withdrew the prosecution against Jiten on 17th May 1929, and on the same day filed a fresh complaint charging both Jiten and the plaintiff. He gave up his brief just before the committal order to the Sessions, as he thought that uncalled for aspersion against him had been made by the members of the Managing Committee. His evidence gives indication that he has not forgotten the incident. It is not necessary to comment on his evidence in detail. On examining the evidence we find that he on his own initiative consulted Mr. Sandell and other persons connected with the Society and got whatever assistance he required from them, and on his advice documentary and oral evidence was given by the prosecution, and we conclude that he held the opinion that the case was a good one for the prosecution. The plea now advanced by him that he felt that the accused would be given the benefit of doubt, as corroborative evidence was wanting, is a thin excuse. He does not state on what points he required corroborative evidence, which could not be or was not supplied. The case conducted by another pleader engaged by the Crown ended in a conviction by the trial Court.
11. The order of the acquittal is conclusive as to the innocence of the plaintiff on the charges on which he was tried, but in our judgment it is permissible for us to look into the nature of the entries made in the fair cash books which formed the subject-matter of the charges and examine the facts and circumstances for the purpose of seeing whether a reasonable man would have been justified in launching the prosecution. We have already found that the item of Rs. 297 odd, said to have been paid to the law clerk, could have justified proceedings against Jiten. The entries relating to Rs. 1462 odd and Rs. 221 which also formed the subject-matter of investigation by the Criminal Court, were admittedly false or fictitious entries. The sums due to Benodini and her brother on account of interest were admittedly not entered on the credit side of the fair cash book. All the entries of this date were made by the plaintiff. He himself had made the transference entry in their pass books, but in the Criminal Court he gave it as his explanation that in copying the entries of the pass books into the fair book, he entered the cash deposit made on that date by them and shown in their pass books, but overlooked the entries about transfer made therein in his own hand. There was similar omission in the case of another depositor. The cash book was falsified admittedly,. and the only question left was whether the falsification was wilful and with intent to defraud. One or two false or fictitious entries may have been due to carelessness but when there are many such entries and' in respect of the same, different explanations were given at different times, it may be by Jiten, and these explanations seemed to an expert, an auditor, to be false, when the auditor after the account papers gave as his considered opinion that the plaintiff was involved in the matter, when the trial Court convicted him and the Appellate Court in respect of one entry at least (re: Rs. 297) thought the explanation given by the accused was thin, it would in our judgment, be safe to hold that the prosecutor had a genuine belief based on reasonable grounds that the plaintiff was guilty.
12. The test formulated by Hawkins J. in Hicks v. Faulkner (1882) 8 QBD 167 at p. 171, which has all along been regarded as the leading case on the subject and has been approved by the House of Lords quite recently in Herniman v. Smith (1938) 1 All ER 1, has in our judgment been satisfied. The fact of conviction by the Magistrate is weighty evidence, though not conclusive evidence, that the facts disclosed a prima facie case against plaintiff, a case which required investigation by the Criminal Court. The facts disclosed by Pathak before the members of the Managing Committee on 20th and 22nd April would have justified a prosecutor in concluding honestly and fairly that the plaintiff was guilty. The fact that the majority of the members of the Committee carried on 22nd April an amendment for further investigation into the conduct of the plaintiff by a subcommittee before rushing to the Criminal Court is no doubt a circumstance which has to be taken into consideration, but in our judgment that cannot outweigh the other facts and lead us to an adverse decision against the appellants on the issue of absence of probable and reasonable cause. Putting the matter in the most favour-able light for the plaintiff, it means that the Managing Committee genuinely and honestly believed, and had reasonable grounds for believing, that a prosecution was justifiable, still they resolved to act very cautiously; and merely because this caution was frustrated by the action of the Manager, it cannot be said probable and reasonable cause was wanting. In Herniman v. Smith (1936) 2 All ER 1377, Scott L. J. said thus:
If in any case the facts known to the would-be prosecutor reasonably are such as to cause him fairly and honestly to conclude that the defendant (accused) is guilty of the offence, there is no law which compels to prosecute further enquiries in order to ascertain whether there is further information obtainable in support of the prosecution on which he has decided.
13. This passage which in our judgment lays down the principle correctly takes away the point from Mr. Sudhir Chandra Roy's evidence that he felt the absence of corroborative evidence and had formed the opinion that without it the plaintiff had the chance of getting the benefit of doubt. The decision of the Court of Appeal in the aforesaid case was affirmed by the House of Lords, Herniman v. Smith (1938) 1 All ER 1, where Lord Atkins laid down the further proposition that where the facts available to the prosecutor at or before he puts the criminal law in motion make out a prima facie case against the accused, he is under no duty to ascertain whether there is a defence to the charge. It is of the highest importance that a lay member of the community acting honestly and reasonably should be free to initiate criminal proceedings without fear of an action for malicious prosecution succeeding against him.
14. Our finding on the issue of probable and reasonable cause puts an end to the plaintiff's claim for damages for malicious prosecution, but as the other two questions have been canvassed before us at length, we proceed to record our findings thereon. The facts do not establish any malice on the part of any of the appellants before us. A prosecution is malicious only if it is commenced or continued with a desire to use the criminal law for a purpose for which it is not intended. In the plaint the plaintiff's case of malice centres round Bhupen. He states that Bhupen to show himself off to the Society as a zealous and competent officer and thereby to strengthen his claim to the permanent managership magnified petty irregularities into serious crimes, and by misrepresentations brought round to his view some of the members of the Managing Committee who were already inimically disposed towards him from before, conspired with them when he was on leave, flouted the resolution of the Managing Committee of 22nd April 1929, which had postponed the lodging of an information to the police against him till the decision of the sub-committee appointed thereby, and finally influenced the Subdivisional Magistrate to take action against him. In the evidence the plaintiff tried to establish that Bhupen had a grudge against him from 1923 on account of a dispute in course of an audit in that year when Bhupen was the auditor. His cross-examination, however demolishes the case of grudge on the part of Bhupen, and the evidence of Satya Charan Mukherji on the point does not carry conviction. The cross examination of the plaintiff at pp. 131, 1, 21; 132, 1, 8 and 130, 1, 10 leaves the allegations made in the first part of para. 13, those made in para. 14 and the material allegations in para. 16 of the plaint without a tittle of evidence to support the same. The ulterior motive ascribed to Bhupen for magnifying petty irregularities receive no support from the facts as established.
15. As has been pointed out by the learned Subordinate Judge, the office of a Manager under the Society was no allurement to Bhupen, a Government servant having security in his service which was moreover pensionable. He was drawing at the time a pay of Rs. 170 with reasonable prospect of advancement. Further, he lodged the information against the plaintiff in pursuance of an order given to him by his superior officer, the Assistant Registrar, which he as a subordinate officer was bound to obey, (Ex. D-3 11-745), an order which was passed on him not on any report made by him to the Assistant Registrar, but on the report of Mr. Pathak. The learned Subordinate Judge in our judgment is right in holding that there was no malice on the part of Bhupen in starting or assisting the criminal prosecution. The suit against Bhupen has been dismissed on this finding, and the plaintiff has not appealed from this part of the judgment and decree. This finding in our judgment has the legal effect of absolving the Society from liability, so far as the action for malicious prosecution is concerned. We shall assume in favour of the plaintiff for present purpose that Bhupen moved the Subdivisional Magistrate to start criminal proceedings against the plaintiff only as the Manager of the Society, and that even if he had acted in excess of authority, his action was ratified by the Society. Even if he had no express authority to lay the information and there was no ratification, the principle that a master is liable for the tortuous actions of his servant acting within the scope of his employment would still be applicable to the case of the Society, a corporation notwithstanding the resolution of 22nd April 1929, seeing that the lodging of a first information report against another employee of the Society falls within scope of his employment as manager of the Society. All the same, we do not think that the Society can be held liable, the case of malice against Bhupen having been negatived.
16. At some time an opinion prevailed that a corporation aggregate cannot in law be made liable in any action, to sustain which proof of malice is required. This opinion proceeds upon the view that malice being a state of mind cannot be imputed to a corporation aggregate which has no mind. A very strong exposition of this view finds expression in the judgment of Lord Bramwell in Abrath v. North Eastern Railway Co. (1886) 11 AC 247. His Lordship punctuated with emphasis and illustrated with examples the proposition that a corporation aggregate can never be liable in an action for malicious prosecution even if all its members, all its office-bearers or all its servants were actuated by malice in starting a criminal prosecution. The decision of the majority of the House of Lords, however, indicates that this dictum had not their approval. The question came up later on before the Privy Council in Citizens Life Assurance Co. Ltd. v. Brown (1904) AC 423 a case of malicious libel. Lord Lindley held that the doctrine that a corporation cannot be made liable on an action for malicious prosecution was an exploded one. 'To talk', said his Lordship, 'of imputing malice to corporations, appears to their Lordships to introduce metaphysical subtleties which are needless and fallacious'. The principle of liability was formulated by him in these terms:
If it is once granted that corporations are for civil purpose to be regarded as persons, i.e. as principals acting by agents and servants, it is difficult to see why the ordinary doctrines of agency and of master and servant are not to be applied to corporations as well as to ordinary individuals. These doctrines have been so applied in a great variety of cases, in question arising out of contract, and in questions arising out of torts and frauds; and to apply them to one class of libels and to deny their applications to another class of libels on the ground that malice cannot be imputed to a body corporate appears to their Lordships to be contrary to sound legal principles.
17. The principle, therefore, is now well established that a corporation would be liable in an action for damages, if a like action against its agents or servants acting with authority or within the scope of their employment would have been maintainable against them, if they had acted as principals. Absence of malice on the part of Bhupen would have protected Bhupen from an action for malicious prosecution, if he on his own behalf and as principal had prosecuted the plaintiff. His action would not have been tortuous, and so no vicarious liability can be fastened on the Society for an act of its servant or agent (Bhupen) which was not in itself an actionable one.
18. With regard to defendants 3 to 9, there is no satisfactory evidence of malice. The evidence given by or on behalf of the plain-tiff that some of them had previous grudge against him is not reliable. It is belied by the documentary evidence on record. These defendants were unanimous with the other members of the Managing Committee, against whom nothing has been said and who have not been made defendants, in appreciating the plaintiff's past work. On 15th April 1928, they had voted for an increase of his salary by Rs. 25 a month [Ex. A (1) II-47]. They considered his services invaluable and indispensable when they twice refused his application for leave in September and October 1928, and also when they sanctioned his leave in January 1929 on full pay [Ex. 2 (Z-16) and 2 (Z-17); II-59], and even as late as 14th March 1929 treated him with utmost consideration [Ex. 2 (Z-22); II-59]. Their opinion was changed only when later on Pathak, a responsible officer of the Co. operative Department and a disinterested person who had examined with care the affairs of the Society, had placed before them at regular meetings of the Managing Committee facts affecting his capacity and honesty. The charge laid against them in the plaint that they were won over by the wilful misrepresentations of Bhupen, and later on entered into a conspiracy with the latter, has not in our judgment been established.
19. We may note in passing that the allegation that they were won over by misrepresentations is in itself sufficient to acquit them of mala fides. There is not a tittle of reliable evidence in support of the averment made in para. 17 of the plaint that they flouted the resolution of the Managing Committee dated 22nd April 1929 and instigated Bhupen to report against the plaintiff to the Registrar and to the Sub-Divisional Magistrate. At that meeting the original motion for informing the police was negatived, and a sub-committee was formed to investigate into the case against the plaintiff. But the resolution of the same meeting was that a copy of the proceedings be forwarded to the Registrar and the Subdivisional Magistrate. It was left to Kalidas Gossain and to Haran Chandra Bose, two of the plaintiff's witnesses and partisans to say that there was no such resolution, and that Mr. San-dell in spite of protests from the former recorded the same in the proceeding book. The cross-examination of the former at page 159 and of the latter at page 188 has exposed their lying statements. These defendants had nothing to do with the initiation or continuance of the criminal proceedings. Some of them helped Mr. Sudhir Roy with facts on which he wanted information, and Mr. Sandell deposed in the criminal case because he was a material witness and had been summoned as a witness. The charge was not false to their knowledge; there was no evidence that any of them misled the police, or produced before it any suborned evidence to induce them to send up an innocent man for trial before the Magistrate. None of them can be called the prosecutors of the plaintiff on the principle formulated in Gaya Prasad v. Bhagat Singh (1908) 30 All 525 at p. 192. We accordingly hold that there is no case against them and must consequently discharge the decree for damages for malicious prosecution passed against them and defendant 1.
20. The only other point that remains to be considered on this part of the case is whether defendant 1 or any of the defendants 3 to 9 was responsible for the plaintiff's prosecution, i.e. can be regarded as his accusers. We have already held that defendants 3 to 9 were not. The letter to the Sub-Divisional Magistrate on which he directed the police to take action was writ-ten by Bhupen. It was Pathak and Bhupen who approached the Magistrate. But as that letter was signed by Bhupen also as Manager of the Society, the Society occupies in our judgment the position of an accuser. Our decision is against defendant 1 on this point, but it does not, in view of our preceding findings, affect the decree which we have passed above.
21. There only remains for consideration the plaintiff's claim for damages for wrongful dismissal. He was at first asked to submit his explanation within a fortnight on two charges formulated against him in the meeting of the Managing Committee held on 30th March 1929, (Ex. A-18; II-63); one of them concerned his work of management, re: loan to Aziz and his relations, but the other was of a more serious nature; it was his preferential treatment to debtors to the detriment of the Society's interest. The debtors to whom he accorded such undue and preferential treatment were either his or Jiten's relations. This is a finding of the learned Subordinate Judge based on good evidence. The plaintiff did not submit any explanation in time and pleaded on 14th April 1929, that for submitting an explanation he required information which he had asked for from Jiten, [Ex. 5 (a) dated 14th April 1929; II-759]. This was a false excuse. He states in his examination-in-chief that he could not submit any explanation as he was not given facilities for examining the books (1-72,R 12-18). This is also a false statement. His statement in cross-examination at p. 114, 1. 12-20, shows that he never cared to obtain any information from the records in the Society's office. Later on, he wrote a letter on 4th May 1929, to the Secretary of the Society (Ex. 5; II-741). It is no explanation of the specific charges he was required to meet. Only general statements in the nature of platitudes were made therein. In the course of time, other facts were found against him, and the charges on which the Society proceeded to dismiss him summarily are summarized in the proceedings of the meeting of the Managing Committee held on 29th May 1929 (Ex. A-15; II-77). We have to see which of these charges have been established, and if those which have been established entitled defendant 1 to dismiss him summarily. In considering this question we have also to take into account other matters not mentioned in this part of the proceedings of 29th May 1929, but which transpired later, for, it is an established proposition that a dismissal can be justified on a ground not stated or known to the master at the time of dismissal: Smith's Law of Master and Servant, p. 80, Edn. 8.
22. The charges formulated against the plain-tiff arrange themselves under three main heads : (1) acts of mismanagement, (2) acts of bad faith and (3) acts which were detrimental to the financial position of the Society. Under the first head come the following : (a) lack of supervision over the day to day administration, (b) bad investments and wilful failure to take steps to realize them, (c) allowing large claims to be barred by limitation, (d) allowing Jiten and his own son Sudir to act without security in spite of resolutions of the Managing Committee, (e) payments made to the building contractor in excess of the amount sanctioned, (f) loans advanced to minors, (g) issuing shares in excess of the authorized capital.
23. Under the second head come the following : (a) Preferential treatment to his own relations and relatives of Jiten to the detriment of the interests of the Society, (b) temporary misappropriation of the Society's money for financing his private business and that of his son, (c) large amount; of paper transactions made to mislead the members of the Society and to serve personal ends, (d) alteration of a resolution of the Managing Committee relating to further loans to bustee people, (e) forging the name of a dead depositor.
24. Under the third head falls the manner in which he conducted his own money lending business. We will take up these seriatim. (His Lordship then discussed the evidence and proceeded.) In our judgment the Society or any Bank cannot with safety to itself continue the services of a manager guilty of such acts and any Bank would be justified in dismissing him. This was not merely carrying on business by the employee in competition with the employer, but at the cost of the employer. These charges which have been established against the plaintiff would, in our judgment, entitle a master to dismiss his servant summarily. In considering the question whether a summary dismissal is justified, the principles formulated by the Judicial Committee in Jupiter General Insurance Co. v. Ardeshir Bomanji 0065/1937 must be kept in view. The position of the employee and the nature of business entrusted to him must be considered. A single act of negligence on his part would not ordinarily be sufficient to justify a summary dismissal. It is a strong measure and must be justified only when a strong case is made out. There is abundant authority for the view that where conduct consists of an accumulation of acts which occurring singly would not in themselves justify dismissal, dismissal may be justified. Manifold charges, some of them of a serious nature, have in this case been established, and taking their cumulative effect into account, we are of opinion that the dismissal was justified provided the Managing Committee was legally competent to dismiss him. This raises the question as to whether the Managing Committee had such power. The Managing Committee was the governing body of the Society. It was its executive. It was responsible for the good management of its affairs. Through appointment of competent members of the staff, management could be carried on. The Managing Committee had therefore the power to appoint and did appoint the plaintiff, but as the appointment of the plaintiff at a salary involved financial obligations, under bye-law 23 (v) it had to be brought to the notice of the members assembled at an ordinary general meeting. Bye-law 23 defines the business of an ordinary general meeting. The relevant portion runs thus:
The business of an ordinary general meeting shall be...
(5) to take notice of any subjects which affect the financial position of the Society and to pass resolutions with regard to them,
(Exhibit 0, portion not printed). In accordance with this bye-law, the fact of the appointment of the plaintiff at a salary was tabled as an item of business at an ordinary general meeting long after he had been actually appointed by the Managing Committee. The members assembled at the general meeting could have turned it down on the ground that the Society could not then bear the burden of his salary. If however they were of opinion that a salaried manager was desirable and that the pay was such as the Society could bear having regard to its financial position and the amount of work of the Society, they could not in our judgment pass a resolution for having another man on the same pay. In no sense could they be regarded as the appointing authority. The Managing Committee had the power to appoint the plaintiff and did appoint him, and so had the legal authority to dismiss him. Even if this view is wrong, there is a resolution of the members of the Society assembled at the general meeting held on 30th May 1926 [Ex. 2 (z); II-35] by which the Managing Committee was authorized to dismiss the staff, and this authority according to the construction we put on the said resolution continued till the next annual general meeting which was held in the year 1931. We accordingly hold that the plaintiff's dismissal was by a competent authority and was justified.
25. The result is that this appeal is allowed and the cross objections dismissed. The plaintiff's suit is dismissed with one set of costs throughout. Hearing fee is assessed at Rs. 250. The same to be apportioned between the defendants in the following manner : (a) defendant 1 will get from the plaintiff half of the costs of this Court and of the Court below; (b) defendants 3 to 9 will get equally between them half of the costs of this Court, and (c) they would get equally between them half of the costs of the lower Court less what has been awarded to defendant 2 by the decree of the said Court.
26. 26th July 1938. - It is represented to us to-day that there may be some dispute later on between the parties on the ground that the last portion of our judgment dealing with costs is liable to be misinterpreted. We directed that one set of the lower Court's costs is to be paid by the plaintiff to the defendants. By that we meant one set of pleader's fee, although there was separate representation of the different defendants, calculated on the total claim which was Rs. 10,100, that is to say, pleader's fee was to be taken to be Rs. 352, and that was to be apportioned amongst the defendants in the following way, namely half of the pleader's fee, that is Rs. 176, would have to be paid by the plaintiff to defendant 1 and the other half, namely Rs. 176, to be paid by the plaintiff to defendants 2 to 9 to be divided among said defendants 2 to 9. As there was no appeal against defendant 2, we could not disturb the decree for costs made in his favour by the lower Court and therefore we directed that out of the sum of Rs. 176 payable by the plaintiff on account of the pleader's fee, defendant 2 would get whatever had been awarded to him by the decree of the lower Court, namely Rs. 117-5-4 and the remainder, that is, Rs. 58.10-8 was to be divided equally between defendants 3 to 9. The decree of this Court would accordingly be drawn up on the terms indicated above, that is to say defendant 1 would get from the plaintiff all other items of costs mentioned at p. 270 of part I of the paper-book, but in the place of Rs. 117-5-4 against the item 'pleader's fee,' the amount is to be Rs. 176. Defendants 3 to 9 would get from the plaintiff all the items of costs mentioned at p. 269 of part I of the paper-book, but the pleader's fee is to be Rs. 58-10-8 instead of Rs. 117-5-4 as stated therein, and the total of the said amount would be divided equally between defendants 3 to 9. So far as the schedule of costs awarded to defendant 2 mentioned at page 271 of the paper-book is concerned, that would remain unaffected. There was no ambiguity in the order for costs in this Court. That order stands.