JUDGMENT ML SRINIVASAN, C.J.—The petitioner Federation was superseded under Section 37 of the H.P. Co-operative Societies Act, 1968, (hereinafter referred to as "the Act"). The second respondent herein is appointed as Administrator and he took over on 22-8-1978 in addition to his own duties as District Co-operative and Supplies Officer, Bilaspur. The third respondent was appointed as Executive Officer of the Federation on deputation basis for a period of two years from the Fisheries Department and he joined as such on 9-4-1979. The petitioner invited tenders through advertisement from the Fish contractors/firms in order to undertake the sale of fish to be supplied for the Federation during the year 1980-81. M/s. Rupika Enterprises entered into an agreement with the Federation for supply of fish catch for the period 14-4-1980 to 31-3-1981. The Firm furnished a bank guarantee of Rs. 1,00,000/- to the Federation till 26-4-1980 to ensure payment of sale proceeds. The bank guarantee purported to have been issued by the Punjab and Sind Bank, Tilak Nagar, New Delhi, favouring the Federation. During the course of annual audit for the year commencing from 1-7-1979 and ending 30-6-1980. The Inspector audit pointed out some irregularities which had been committed by the third respondent, Executive Officer and it was also pointed out that the bank guarantee furnished by Rupika Enterprises and accepted by the third respondent was a fake one. After calling for explanation from respondents 2 and 3, the Registrar made a reference for arbitration to the Registrar Co-operative Societies against M/s. Rupika Enterprises. An award was passed on 3-11-1981 for a sum of Rs. 2,05,948.51 as principal on 1-12-1980. The Federation was also permitted to execute the award as if the amount is due as arrears of land revenue by sale of movable and immovable properties of the firm. 2. Even before the award was completely executed and the amount could be realised, proceedings were initiated by the Addl. Registrar Co-operative Societies in 1984, under Section 69 of the Act against respondents 2 and 3. By order dated 2-4-1985 respondents 2 and 3 were directed to discharge their liabilities by payment of the entire amount to the Federation under intimation to the Director of Cooperation. Aggrieved by the said order, respondents 2 and 3 preferred appeals before the Commissioner-cum-Secretary (Co-operation) to the Government of Himachal Pradesh. By order dated 2-4-1985 respondents 2 and 3 were directed to discharge their liabilities by payment of the entire amount to the Federation under intimation to the Director of Cooperation. Aggrieved by the said order, respondents 2 and 3 preferred appeals before the Commissioner-cum-Secretary (Co-operation) to the Government of Himachal Pradesh. By order dated 13-4-1989 the Secretary set-aside the order of the Registrar and advised the Registrar as well as the Federation to take steps to recover the award money from M/s. Rupika Enterprises. 3. It is the said order of the Appellate Authority which is under challenge in this writ petition. The main reason given by the Appellate Authority is that two parallel proceedings have been initiated against respondents 2 and 3 in the present case and it should not have been done so by the Registrar. The relevant part of the order of the Appellate Authority is found in the following passage : "After going through the record, I find that two parallel proceedings were initiated in this case. In the arbitration case, the Registrar, Co-operative Societies, vide his order dated 3-11-1981 had announced his award in favour of Fish Federation. In this order, he did not make any mention about the carelessness of both the appellants. It was not desirable to initiate surcharge proceedings when the award has already been announced by the learned Registrar, Co-operative Societies. It appears that the existence of award was ignored altogether. The conditions precedent for making order of surcharge were also not taken care of. It is a settled law that two provisions of award and surcharge are not intended to operate on parallel lines. The recovery of awarded amount from respondent No. 2 was the course open to the Fish Federation and they should have taken steps to recover that amount. The learned Registrar, Co-operative Societies ought not have taken course to surcharge proceedings simultaneously for which he has already held M/s. Rupika Enterprises responsible and liable to repay the awarded amount. There is nothing on record that the awarded amount cannot be recovered from respondent No. 2. Shri P.C. Parban has mentioned in his appeal that the firm approached him on 9-10-1980 and gave in writing that they would arrange payment of arrears in four equal instalments of Rs. There is nothing on record that the awarded amount cannot be recovered from respondent No. 2. Shri P.C. Parban has mentioned in his appeal that the firm approached him on 9-10-1980 and gave in writing that they would arrange payment of arrears in four equal instalments of Rs. 50,000/- each on 20-10-1980, 5-11-1980, 15-11-1980 and 5-12-1980 and that if they were resumed supplies of fish, they would make daily payments of the fish delivered to them. The firm also mentioned in writing that they were taking legal action against the bank for refusing to honour the guarantee bond. It is also on record that the supply of fish was resumed on receipt of payment of Rs. 50,000/- on 9-10-1980. The firm continued lifting fish against daily cash payments up to 30-11-1980. However, firm could not make more payments to liquidate the arrears and consequently, the contract was cancelled. 9. Shri P.C. Parban also lodged an FIR at Bilaspur Police Station in colsultation with the District Attorney. The contractor is also reported to have admitted in writing before the Registrar, Co-operative Societies vide his letter dated 25-3-1983 that the contractor firm had to pay a sum of Rs. 2.05 lacs as arrears to the Fish Federation. It appears that Shri P.C. Parban had been making efforts to recover the arrears from respondent No. 2." 4. It is contended by the learned Counsel for the writ petitioner that a proceeding under Section 69 of the Act is independent of a proceeding under Section 72 under which an award has been passed. According to him the award _ has been passed against the firm M/s. Rupika Enterprises and the proceeding under Section 69 is taken against the persons who were in the management of the society. It is contended that there is no bar to such parallel proceedings and the order of the Commissioner-cum-Secretary is, therefore, vitiated. Reliance is placed upon the judgment of the Supreme Court in Yogendra Prasad v. Addi Registrar, Co-operative Societies, Bihar and others, AIR 1991 SC 2137. In that case, the proceedings were under the Bihar and Orissa Co-operative Societies Act (6 of 1935). The appellant before the Supreme Court was the ex-treasurer of the Cooperative Development and Cane Marketing Union. He had defalcated a sum of Rs. In that case, the proceedings were under the Bihar and Orissa Co-operative Societies Act (6 of 1935). The appellant before the Supreme Court was the ex-treasurer of the Cooperative Development and Cane Marketing Union. He had defalcated a sum of Rs. 95,790.54 and for the recovery of the said amount, proceedings were initiated under Section 48 of the Bihar and Orissa Co-operative Societies Act and the Registrar referred the matter to the Asstt Registrar, who, on inquiry, after giving an opportunity to the appellant, passed an award on 30-12-1976 for the said amount. On appeal, the Deputy Registrar set aside the award on the ground that the appellant was surcharged in Surcharge Case No. 18 of 1976 and on further revision, the first respondent set aside the appellate order and confirmed the award with a further direction to pay interest till date of recovery, The writ petition filed by the appellant was dismissed by the High Court and on Special Leave, the Supreme Court held that there was no bar to the proceedings under Section 48 for passing an award after arbitration because of the proceedings for surcharge. It is pointed out by the Supreme Court that the surcharge proceedings were pending before the Government and there was no statutory bar for the proceedings in arbitration and it was held that the award could not be challenged. 5. That decision will have relevance in the present proceedings. Language of Section 69 is very significant. It reads as follows : "69. 5. That decision will have relevance in the present proceedings. Language of Section 69 is very significant. It reads as follows : "69. Surcharge :-(1) If in the course of an audit, inquiry, inspection or the winding up of a co-operative society, it is found that any person who is or was entrusted with the organisation or management of such society, has made any payment contrary to the provisions of this Act, the rules or the bye-laws or has caused any deficiency in the assets of the society by breach of trust, or wilful negligence or has misappropriated or fraudulently retained any money or other property belonging to the society, the Registrar may, of his own motion or on the application of the committee liquidator, or any creditor, inquire himself or direct any person authorised by him, by an order in writing in this behalf, to inquire into the conduct of such person; Provided that no such inquiry shall be held after the expiry of six years from the date on which any act of commission or omission referred to in this sub-section comes to knowledge. (2) Where an inquiry is made under sub-section (1), the Registrar may, after giving the person concerned an opportunity of being heard, make an order requiring him to repay or restore the money or property or any part thereof with interest at such rate, or to pay contribution and cost or compensation to such extent, as the Registrar may consider just and equitable. (3) This section shall apply notwithstanding that the act is one for which the offender may be criminally responsible." 6. In sub-section (1) of Section 69, if it is found in the course of an audit, inquiry, inspection or the winding up of a cooperative society, that any person who is entrusted with the organisation or management of the society, has made any payment contrary to the provisions of this Act, the Rules or the Bye-Laws, then an inquiry can be heid under the said section. Secondly, if any such person had caused any deficiency in the assets of the society by breach of trust or wilful negligence, then also an inquiry can be initiated. Thirdly, if any such person has mis-appropriated or fraudulently retained any money or other property belonging to the society, then also, the Registrar can initiate an action. Secondly, if any such person had caused any deficiency in the assets of the society by breach of trust or wilful negligence, then also an inquiry can be initiated. Thirdly, if any such person has mis-appropriated or fraudulently retained any money or other property belonging to the society, then also, the Registrar can initiate an action. Thus, in three different contingencies, action can be initiated under Section 69(1) of the Act. In this case, contingencies 1 and 3 will not apply. It is not the case of the petitioner that respondents 2 and 3 had made any payment contrary to the provisions of the Act, Rules or Bye-laws; nor is it the case of the petitioner that respondents 2 and 3 had misappropriated or fraudulently retained any money or other property belonging to the society. On the other hand, the only case of the petitioner is that respondents 2 and 3 have caused deficiency in the assets of the society by wilful negligence on their part. In order to make out a case on this ground, two things are required to be established : (1) There must be a deficiency in the assets and (2) there should be wilful negligence on the part of the person concerned. Even the first requisite is not satisfied in the present case. Unless and until it is shown that there is a deficiency in the assets of the society, the proceedings under Section 69 of the Act cannot be initiated. 7. We have already stated that an award has been passed by the Registrar under the provisions of Section 72 of the Act. The award has not become time-barred and it is being executed at the time when the Registrar initiated proceedings under Section 69 of the Act. The Appellate Authority has referred to the fact that certain payments are being made towards the amount due under the award and that the proceedings in execution are being continued. In such a situation, there was no authority at all for the Registrar to initiate proceedings under Section 69 of the Act. 8. Learned Counsel for the petitioner draws our attention to the orders passed by the Chief Judicial Magistrate, Bilaspur found in Annexures P -1 and P-2. In such a situation, there was no authority at all for the Registrar to initiate proceedings under Section 69 of the Act. 8. Learned Counsel for the petitioner draws our attention to the orders passed by the Chief Judicial Magistrate, Bilaspur found in Annexures P -1 and P-2. By the order passed in Annexure P-1 dated 5 6-1986, the Chief Judicial Magistrate held that there was a prima facie case under Sections 420,465,468,471/34 IPC against the first accused, namely, Jaspal Singh who entered into an agreement with the petitioner Federation and filed forged power of attorney and bank guarantee and entered into correspondence with them. By the second order dated 31-1-1989 Annexure P-2, the Chief Judicial Magistrate declared the accused to be an absconder and directed issue of proclamation in accordance with the procedure envisaged in Section 82 of the Code of Criminal Procedure. These two orders came into existence in 1986 and 1989, but the Registrar had initiated proceedings even in 1984 under Section 69 of the Act. 9. Hence those proceedings were totally unwarranted. The Commissioner has rightly pointed out that the parallel proceedings on the ground of deficiency in the assets could not have been initiated, when it was not found that the award had become inexecutable. If the award had become inexecutable, the question whether it had become so on account of the wilful negligence of respondents 2 and 3, resulting in deficiency in the assets of the society, could be gone into by the Registrar. But that has not at all been done in the present proceedings. Hence the order passed by the Registrar has been rightly set aside by the appellate Authority. In our opinion, there is no merits in this writ petition and it is dismissed. No costs. Petition dismissed.