B. S. A. SWAMY, J. ( 1 ) THE plaintiff in O. S. No. 131 of 1983 on the file of Subordinate Judge Court, cuddapah filed this appeal questioning the correctness of the decree and judgment wherein the suit was decreed against the first defendant-Co-operative Society and the third defendant, the paid Secretary while dismissing the suit against the President of the society second defendant on the ground that the Paid-Secretary is wholly responsible for the maintenance of the day to day affairs of the society basing on the bye-laws marked as Ex. B. 1. ( 2 ) THE parties are referred to as arrayed in the suit. The plaintiff-Corporation represented by its District Manager, cuddapah appointed Simhadripuram Cooperating marketing Society, Pulivendla on the recommendation of the District Collector, cuddapah for supply of levy sugar to fair price shop dealers on commission basis. The duty of the Co-operative Society is to receive the levy sugar from the transport contractor and store the same in the godowns and issue the levy sugar after collecting demand drafts from the persons to whom the permits are issued by the plaintiff- corporation and deposit in the bank. The society has to send fortnightly returns showing the stock received, permits received, drafts received from fair price shop dealers, sugar delivered and the balance of stock of sugar remaining to the District supply authorities. ( 3 ) IN the annexure the relevant portion reads as follows:"and whereas the Commission agent has qualified for such appointment and has agreed to perform the duties hereinafter described under the terms and conditions mentioned below: (1) Receipt of sugar, unloading the same from trucks, weighment and stocking in the go downs, meeting the handling charges; (2) Storage and Insurance of stocks; (3) Issue of sugar after weighment to fair price shops and load the same into vehicles/carts of the fair price shops meeting the handling charges. (4) Issue of release orders to fair price shops against allotment made by the Tahsildars duly collecting the payments in the form of D. D. s. , banker Cheques or pay order obtained in favour of A. P. State Civil supplies Corporation Limited. (5) Depositing of D. Ds. Banker cheques or pay orders daily into the corporation s Depository account opened at the Taluk Headquarters. (6) Maintenance of various registers prescribed for the purpose. (7) Giving Bank Guarantee for Rs. (5) Depositing of D. Ds. Banker cheques or pay orders daily into the corporation s Depository account opened at the Taluk Headquarters. (6) Maintenance of various registers prescribed for the purpose. (7) Giving Bank Guarantee for Rs. 10,000/- before signing the agreement. The case of the plaintiff is that initially the society was appointed as Commission Agent for a period of one year from 4-5-1980 to 3-5-1981 and was renewed for another period of one year from 4-5-1981. It is also his case that the transport agents delivered 14,767,20 Qts. of levy sugar from March, 1980 to November, 1981 and the defendants acknowledged the same. As per the books of accounts maintained by the Corporation and the acknowledgment receipt submitted by the defendants, the commission agent received the stock as mentioned above and remitted an amount of Rs. 45,15,029-98 ps. only towards the cost of 13, 950-30 Qtls. of levy sugar. The then District Manager inspected the society s premises on 6-11 -1981 and on 23-11 -1981 and found no representative of the President and third defendant were available to show the stock register. Once again the District Manager visited the defendants-society. On 24-11 -1981 the plaintiff Corporation issued a notice to the first and second respondents to send fortnightly returns for which there was no reply. Lastly on 27-11-1981 the District mananer visited the premises of the first defendant. As the second and third defendants were not available he waited till the afternoon of 28-11 -1981 and afterwards locked the premises in the presence of panchayatdars. On 17-12-1981 the District manager of the plaintiff Corporation opened the lock in the presence of the Tahsildar, village Munsif and other mediators and found stock of 242-91 Qtls. of sugar only. The difference of levy sugar came to 577. 99 quintals. Thereafter the plaintiff Corporation gave legal notice to all the defendants. Notices sent to the President and paid- secretary were returned unserved. Thereafter the present suit was filed claiming a sum of Rs. 4,19,620-74 ps. at the rate of 200 percent of wholesale issue price of sugar for the missing stocks as per the terms of the agreement. By the time the suit is filed there seemed to be some change in the office of the President. Thereafter the present suit was filed claiming a sum of Rs. 4,19,620-74 ps. at the rate of 200 percent of wholesale issue price of sugar for the missing stocks as per the terms of the agreement. By the time the suit is filed there seemed to be some change in the office of the President. First defendant filed his written statement and contended that the second defendant who is the President of the society at the time of this transaction had done in his personal capacity and he has not handed over the records maintained to the present President. So the first defendant is not at all liable for this amount. It is open to the plaintiff Corporation to take appropriate action against the second defendant and the corporation cannot proceed against the first defendant-society. The second defendant i. e. the former President, in his written statement contended that as per Rule 31 of the bye-laws of the society (1) the Secretary or the Manager of the society shall be responsbile for the general conduct, supervision and management of the day to day business and affairs and the administration of the society, (2) further he shall be the Officer to sue or to be sued on behalf of the society, (3) all bonds, agreeemnts and contracts made by the society shall be in his name. It is useful to extract the next few sentences in the written statement. to the knowledge of this defendant the society stocks were checked by the d. S. O. Cuddapah and found to be correct as on 11-8-1981. Upto 13-10-1981 this defendant was in head quarters at Pulivendla. After that, dondlavagu Society elections and due to family and personal troubles this defendant left the village as he was mentally upset. After that date what happened to the Society transactions this defendant is not aware of. Even earlier transactions also the third defendant used to look after, excepting at odd hours that too in the absence of third defendant, when this defendant received stocks. After the receipt of stocks third defendant was the person dealing with the stocks and its disbursement". After that date what happened to the Society transactions this defendant is not aware of. Even earlier transactions also the third defendant used to look after, excepting at odd hours that too in the absence of third defendant, when this defendant received stocks. After the receipt of stocks third defendant was the person dealing with the stocks and its disbursement". ( 4 ) FROM this statement it is seen that all is we , I with the affairs of the society in dealing with the levy sugar upto 13-10-1981 and something fishy taken place after that date and before 6-11 -1981 i. e. first time when the officials of the Corporation visited the society i. e. almost within a span of three weeks the sugar seemed to have been missing from the godown of the society. The third defendant i. e. the Secretary in his written statement stated that he was only a clerk appointed on salary and he has nothing to do with the omissions and commissions committed by the first and second defendants in relation to the plaintiff. It is only the first and second defendants who entered into agreement with the plaintiff and functioned as Commission agents for the plaintiff. He is not aware of the transactions of levy sugar deficit, sale, non-remittance or otherwise with the affairs and activities of the plaintiff and the defendants 1 and 2. He also admitted that he was implicated in a false criminal case in Cr. No. 62 of 1982 of the pulivendala Police Station. On the basis of the above pleadings the following issues were framed by the trial Court. (1) Whether the plaintiff is entitled to recover the suit claim against which defendant of all defendants and against what items? (2) Whether the suit is not maintainable as pleaded by second defendant? (3) To what relief? ( 5 ) ON behalf of the plaintiff initially one raghavendra Rao was examined as P. W. 1 but due to his transfer his cross-examination could not take place and the evidence of this witness was eschewed by the Court. Thereafter the Assistant Manager was examined as P. W. 2 in this case and Ex. A-1 the Photostat copy of the agreement dated 14-5-1981 entered into between the plaintiff corporation and the society, Ex. A-2 statement showing the datewise and lorry- wise sugar entrusted to first defendant society, Ex. Thereafter the Assistant Manager was examined as P. W. 2 in this case and Ex. A-1 the Photostat copy of the agreement dated 14-5-1981 entered into between the plaintiff corporation and the society, Ex. A-2 statement showing the datewise and lorry- wise sugar entrusted to first defendant society, Ex. A-3 carbon copy of Panchanama for the seizure of 242. 91 Qts. of sugar made on 17-12-1981, Ex. A-4 is the true copy of the complaint given by the District Manager to the S. H. O. Pulivendla Police station, ex. A-5 is the office copy of the registered notice dated 18-8-1982 issued to the defendants, Exs. A-6 and A-7 are the returned registered postal covers with acknowledgments addressed to second defendant and third defendant. At the time of trial, the defendants 1 and 3 - the Cooperative society and the 3rd Defendant secretary of the society did not participate in the trial and the President i. e. second defendant alone participated in the enquiry and got himself examined as D. W. 1 and marked Ex. B-1 copy of the bye-laws of the society. Having extracted the factual background of the case the learned Judge in pare 11 observed as hereunder:"11. All the defendants have filed written statements. In this case only second defendant who entered into an agreement under Ex. A-1 with the plaintiff Corporation has contested the suit. The other defendants have remained ex parte. On the other hand second defendant is not disputing regarding shortage of sugar of first defendant society that was supplied by the Corporation and the liability there under towards the value of the deficit of sugar 577. 99 quintals. Second defendant who is contesting the suit is not disputing the evidence of P. W. 2 regarding the shortage of sugar and its value". ( 6 ) THE learned Subordinate Judge by giving much importance to the bye-laws of the society and the admissions made by p. W. 2 in the witness box held that the secretary of the society is personally responsible for all the transactions of the society and the responsibility of the president is only to conduct meetings and give guidelines. Having taken that view while decreeing the suit against the society and secretary dismissed the suit against the president by holding that the suit against second defendant in his personal capacity is not maintainable. Having taken that view while decreeing the suit against the society and secretary dismissed the suit against the president by holding that the suit against second defendant in his personal capacity is not maintainable. ( 7 ) AGGRIEVED by the said Judgment and decree, the Corporation filed this appeal. ( 8 ) THE sole contention that was raised in the appeal by Mr. Subba Reddy is that the learned Subordinate Judge having decreed the suit against Defendants 1 and 3 gravely erred in dismissing the suit against the president of the society relying on the bye- laws of the society, which have no force of law. ( 9 ) THE appeal stood dismissed for default against R-1 and R-3 by the order of the court dated 6-3-2002. The effect of dismissal of the suit would be that the decree passed by the trial court against those respondents became final. Since the issue raised in this appeal is whether the President of the society is also liable for the suit amounts or not, the appeal survives against the President of the society, who is represented by a counsel before this Court. ( 10 ) THE first respondent Co-operative society is a registered society under the provisions of the A. P. Co-operative Societies act, 1964 (for short "the Act") and as per section 9 of the Act, a society registered under the provisions of the Act, is a body corporate by the name under which it is registered having perpetual succession and a common seal. The society is entitled to acquire, hold and dispose of property, to 9nter into contracts on its behalf, to institute and defend suits and other legal proceedings and to do all other things necessary for the purpose for which it was constituted. ( 11 ) FROM this it is seen that the society is alone entitled to enter into contracts with others and the society being a body corporate, it will be entering into contract represented by its President. ( 12 ) UNDER Section 30 of the Act, the ultimate authority of the society is vested in the general body and under Section 31 of the Act, the genera! body of the society shall constitute a committee in accordance with the bye-laws and entrust the management of the affairs of the society to such committee. ( 12 ) UNDER Section 30 of the Act, the ultimate authority of the society is vested in the general body and under Section 31 of the Act, the genera! body of the society shall constitute a committee in accordance with the bye-laws and entrust the management of the affairs of the society to such committee. ( 13 ) UNDER Rule 22 of the A. P. Cooperative societies Rules, 1964 (for short "the Rules), the procedure to elect the members of the Committee was specified. ( 14) UNDER Rule-22 (9) the President and other office bearers of the society are to be elected. ( 15 ) FROM the above, it is seen that while day-to-day affairs of the society have to be carried out by the Committee elected by the members of the society, and for all practical purposes, its President will represent all the transactions. Hence, it cannot be said that under the bye-laws of the society, the paid secretary is responsible for maintenance of the accounts and the President has no responsibility whatsoever in the affairs of the society. ( 16 ) THE law is well settled that bye-laws of a society have no statutory force and as such they are unenforceable. Hence, whatever may be stated in the bye-laws of the society, under the statutory provisions of the society, it is the managing committee that is responsible for the activities of the society and the President merely represents the society in its transactions with others or with the members of the society. In fact, in this case also, the 2nd defendant in his capacity as President of the society entered into agreement with the Corporation. Now to wriggle out of his obligation he has gone to the extent of stating in his written statement that the agreement entered into between him and the Corporation is invalid under law. ( 17 ) BE that as it may, no issue was framed to the effect that whether the agreement entered into by the President with the Corporation is an invalid one in the light of the provisions of the bye-laws of the society. Having entered into an agreement with the plaintiff-Corporation he cannot turn round and contend that he is not under obligation to account for the stocks of sugar received by him. Having entered into an agreement with the plaintiff-Corporation he cannot turn round and contend that he is not under obligation to account for the stocks of sugar received by him. ( 18 ) UNDER Section 213 of Indian Contract act, an agent is bound to render proper accounts to his principal on demand. Admittedly, in this case the President of the society having entered into an agreement, cannot contend that he is not the agent, but someone is the agent. Such a plea cannot be allowed to be taken by the President in the light of Section 213 of the Contract Act. Viewed from any angle (ie.) either from the provisions of the Co-operative Societies Act or under the Indian Contract Act, the president of the society cannot escape his liability from reimbursing the Corporation for the stocks of sugar that were found missing in the godown of the society. Hence, to that extent the judgment and decree of the courts below cannot be sustained in law and I hold that the President is also liable to compensate the plaintiff-Corporation by way of liquidated damages for the stocks of sugar that was missing by the society concerned. ( 19 ) AT this stage, Mr. M. N. Narasimha reddy appearing for the President tried to attack the judgment of the trial Court both on technical grounds as well as on merits. His case is that since the suit was dismissed against him there was no occasion to file appeal against the judgment and decree, since the appellate court is taking a different view from that of the trial court with regard to liability of his client, he is entitled to canvass the correctness of the judgment under order 41, Rule 33 of CPC. It is useful to extract the same for brevity and better understanding of the matter. It is useful to extract the same for brevity and better understanding of the matter. "order 41, Rule 33: The Appellate court shall have power to pass any decree and make any order which ought to have been passed or made and to pass or make such further or other decree or order as the case may require, and this power may be exercised by the Court notwithstanding that the appeal is as to part only of the decree and may be exercised in favour of all or any of the respondents or parties, although such respondents or parties may not have filed any appeal or objection and may, where there have been decrees in cross-suits or where two or more decrees are passed in one suit, be exercised in respect of all or any of the decrees, although an appeal may not have been filed against such decrees. Provided that the Appellate Court shall not make any order under Sec. 35-A, in pursuance of any objection on which the Court from whose decree the appeal is preferred has omitted or refused to make such order". ( 20 ) FROM the above, it is seen that the appellate Court is given the power to pass any decree that would have been passed in the ends of justice notwithstanding that the appeal is filed only on a part of the decree or order and such a power can be exercised in favour of all or any of the respondents or parties, although such respondents or parties may not have filed any appeal or objection. I find sufficient force in the contention of Mr. M. N. Narasimha Reddy and permitted him to argue on the correctness of the judgment of the trial court. ( 21 ) MR. M. N. Narasimha Reddy firstly contended that the agreement contained an arbitration clause and in view of Sections 31 to 33 of the old Arbitration Act, the suit itself is not maintainable. It is true that the agreement contained an arbitration clause, which is as follows:"all disputes and the differences arising out of or in anyway attaching of concerning this agreement whatsoever shall be the managing director of the A. P. State Civil Supplies Corporation limited. . . . . . . . It is true that the agreement contained an arbitration clause, which is as follows:"all disputes and the differences arising out of or in anyway attaching of concerning this agreement whatsoever shall be the managing director of the A. P. State Civil Supplies Corporation limited. . . . . . . . and the award of such arbitrator or a person nominated by him the award of such arbitrator shall be final and binding on the parties". Hence Mr. M. N. Narasimha reddy contends that the suit is liable to be dismissed. ( 22 ) COUNTERING the argument of the learned counsel Sri N. Subba Reddy appearing for the Corporation brought to my notice Section 34 of the Arbitration Act, 1940. Under Section 34 of the Act, if any party commences any legal proceedings without first approaching arbitrator, the other side before filing the written statement has to raise an objection that the Court cannot proceed with the hearing of the suit in the light of the arbitration clause contained in the agreement and if the Court is satisfied, it can stay the proceedings until arbitration proceedings are completed. ( 23 ) ADMITTEDLY, in this case the respondent did not raise this objection either before filing the written statement or after filing of the written statement. On the other hand, he actively participated in the suit before the trial Court and as such it is too late in the day to contend that the suit is not maintainable in law. Accordingly, this contention is rejected. ( 24 ) NEXTLY, Mr. M. N. Narasimha Reddy contended that Ex. A-2 said to be a statement of account for the sugar supplied to the society datewise and lorrywise is not based on any record. The statement was neither signed nor certified by anyone that it is true extract of the same record from the plaintiff s office. In fact, in the statement it is not even mentioned that the statement relates to the first respondent society. Further, the statement does not even contain the name of the society to which the stocks of sugar was supplied. Likewise only a carbon copy of the mediators report that was drawn at the time of opening the seals of the godown on 17-12-1981 was marked as ex. A-3. Further, the statement does not even contain the name of the society to which the stocks of sugar was supplied. Likewise only a carbon copy of the mediators report that was drawn at the time of opening the seals of the godown on 17-12-1981 was marked as ex. A-3. Neither the original was marked nor any person who witnessed the verification of the stock was examined to prove that the contents of Ex. A-3 mediators report are correct. P. W. 2 in the witness box stated that the original records were seized by the police in connection with the investigation on a complaint given by the Corporation. Hence, these documents are sought to be marked. Had the counsel for the respondent raised any objection about the inadmissibility of these two documents in evidence, perhaps the plaintiff Corporation would have tried to get the original from the police or would have filed an application before the court to summon the original documents. But no objection was raised with regard to marking of these two documents as exhibits. In fact, as stated earlier, the trial court in para 11 of the judgment categorically stated that the President of the society did not dispute with regard to shortage of sugar nor disputed the evidence of P. W. 2 regarding the shortage of sugar and its value. Admittedly, these two documents not being the originals, have to be considered as secondary evidence and marking of the documents will be only after laying a foundation for receiving the documents as secondary evidence. ( 25 ) WITH regard to admissibility of secondary evidence, their Lordships of the supreme Court in R. V. E. Venkatachala gounder v. Arulmigu Viswesaraswami and v. P. Temple after surveying the case law held in pare 20 as follows:"20. . . . . . . . . . . The objection as to admissibility of documents in evidence may be classified into two clauses: (i) an objection that the document which is sought to be proved is itself inadmissible in evidence; and (ii) where the objection does not dispute the admissibility of the document in evidence but is directed towards the mode of proof alleging the same to be irregular or insufficient. In the first case, merely because a document has been marked as "an exhibit" an objection as to its admissibility is not excluded and is available to be raised even at a later stage or even in appeal or revision. In the latter case, the objection should be taken when the evidence is tendered and once the document has been admitted in evidence and marked as an exhibit, the objection that it should not have been admitted in evidence or that the mode adopted for proving the document is irregular cannot be allowed to be raised at any stage subsequent to the marking of the document as an exhibit. The latter proposition is a rule of fair play. The crucial test is whether an objection, if taken at the appropriate point of time, would have enabled the party tendering the evidence to cure the defect and resort to such mode of proof as would be regular. The omission to object becomes fatal because by his failure the party entitled to object allows the party tendering the evidence to act on an assumption that the opposite party is not serious about the mode of proof. On the other hand, a prompt objection does not prejudice the party tendering the evidence, for two reasons: firstly, it enables the court to apply its mind and pronounce its decision on the question of admissibility then and there; and secondly, in the event of finding of the court on the mode of proof sought to be adopted going against the party tendering the evidence, the opportunity of seeking indulgence of the court for permitting a regular mode or method of proof and thereby removing the objection raised by the opposite party, is available to the party leading the evidence. Such practice and procedure is fair to both the parties. Out of the two types of objections, referred to hereinabove, in the latter case, failure to raise a prompt and timely objection amounts to waiver of the necessity for insisting on formal proof of a document, the document itself which is sought to be provided being admissible in evidence. In the first case, acquiescence would be no bar to raising the objection in a superior court". In the first case, acquiescence would be no bar to raising the objection in a superior court". ( 26 ) FROM the above, it is seen that if the very document is inadmissible in evidence, the acquiescence of the other party at the time of marking of the document would be no bar to raise the objection in the appellate forum. On the other hand, if the objection is with regard to mode of proof, it cannot be allowed to raise at the time of appellate stage. ( 27 ) MR. M. N. Narasimha Reddy sternly contends that even though the principle laid down in this judgment is applicable to ex. A-3-carbon copy of the mediators panchanama, certainly the statement is inadmissible in evidence and he is entitled to raise objection at the appellate stage. This question was squarely answered by the supreme Court by observing that "the crucial test is whether an objection, if taken at the appropriate point of time, would have enabled the party tendering the evidence to cure the defect and resort to such mode of proof as would be regular. The omission to object becomes fatal because by his failure the party entitled to object allows the party tendering the evidence to act on an assumption that the opposite party is not serious about the mode of proof. ( 28 ) IN the light of these observations of the Supreme Court, let me examine the correctness of contention of mr. M. N. Narasimha Reddy with regard to ex. A-2. ( 29 ) EX. A-2 is a statement containing the particulars of supply of sugar datewise and lorry numbers in which the sugar was transported to the respondent society was given. It is not in dispute that the respondent was acting as a Commission agent to the plaintiff-corporation and the particulars of this statement would have been found in the ledger, account books maintained by the plaintiff corporation. P. W. 2 in his evidence deposed that the books were seized by the police in connection with the investigation into the complaint given by the Corporation. If the counsel appearing for the President in the lower court raised an objection, the officials of the plaintiff Corporation would have brought the originals and proved their case. P. W. 2 in his evidence deposed that the books were seized by the police in connection with the investigation into the complaint given by the Corporation. If the counsel appearing for the President in the lower court raised an objection, the officials of the plaintiff Corporation would have brought the originals and proved their case. On the other hand, in the written statement as well as in the evidence, the president categorically stated that upto 11-08-1981 the the stocks in the Society s godown were tallying with the stocks supplied by the Corporation in the following words "to the knowledge of this defendant the society s stocks were checked by the d. S. O. , Cuddapah as on 11-08-1981". Even in the evidence also he repeated the same by stating that "on 11-08-1981 accounts of d-1 society were checked by the District supply Officer, Cuddapah, and found to be correct". From this, the statement of account filed by the plaintiff Corporation is not being seriously disputed by the President of the society. He wants to get over his liability by throwing the blame on the Paid-Secretary of the society. Had the plaintiff Corporation marked this document with reference to registers maintained by it with regard to supply of stocks of defendant company, things would have been in happier position. But on that ground it is not possible to reject ex. A-2, since D-2 himself was admitting the receipts of the stocks and tallying of the stocks in the society s godown with the stocks supplied by the Corporation till 11-08-1981. Even at this stage, the successor-in-office categorically stated that all the registers and other documents relating to supply of sugar are very much with the President of the society and they were not handed over either to the society or to the secretary. If the President really feels that there is something wrong in the accounts, nothing prevented him to get the certified copy of the acccunts from the plaintiff Corporation and file the same in this court as an additional evidence to prove his bonafides and that the case was falsely foisted against him. Without doing so, the respondent is trying to beat the bush around to escape the liability. Hence, I cannot give much credence to this contention of the counsel and it is accordingly rejected. ( 30 ) MR. Without doing so, the respondent is trying to beat the bush around to escape the liability. Hence, I cannot give much credence to this contention of the counsel and it is accordingly rejected. ( 30 ) MR. M. N. Narasimha Reddy further contended that though in para 3 of the plaint, the plaintiff Corporation stated that the defendant was appointed as Commission agent on 4-5-1980, that agreement was not marked as an exhibit, but the next agreement dated 4-5-1981 whereunder the agency was renewed for one more year and the same was marked as Ex. A-1. In fact, in the case of account they referred to only the latter agreement (i. e.) 4-5-1981, but not the agreement dated 4-5-1980. Nextly, if the statement Ex. A-2 is seen that the sugar that was supplied to the society prior to 4-5-1980 was shown which comes to 1500 bags. If this 1500 bags are deducted from the sugar stock that was supplied to the respondent society after 4-5-1980 there will not be any shortage of sugar. It is true that for reasons best known to it the plaintiff Corporation stated that the society was acting as commission agent w. e. f. 4-5-1980 but in ex. A-2 statement it is shown that from 22-3-1980 to 27-4-1980 on fifteen occasions the sugar was supplied and there was no mention about the supply of this sugar in the plaint. They stated in para 3 of the plaint that the society was acting as commission agent from 4-5-1980. But in pare 5 it is stated that "the plaintiff submits that the transport contractors for levy sugar to Cuddapah district, for the year 1981-82 viz. , b. Satyanarayana, B. Venkatasubbaiah and t. V. Krishna Rao delivered 14767. 20 quintals of levy sugar to the defendants from march 1980 to November, 1981, and the 1 st defendant acknowledged the receipt of the same. ( 31 ) FROM this it is evident that the society is receiving stocks from March, 1980 and the total number of bags that were delivered to the society and the amount received by the plaintiff Corporation. We should keep in mind that the total number of bags of sugar delivered, the amount paid by the defendant finally and the stocks found at the time of opening of the godown on 17-12-1981 are not at all disputed by the President. We should keep in mind that the total number of bags of sugar delivered, the amount paid by the defendant finally and the stocks found at the time of opening of the godown on 17-12-1981 are not at all disputed by the President. When p. W. 2 was in the witness box, the President did not choose to point out this discrepancy nor elicited anything contra in his favour. Though the plaintiff stated that the society was appointed as commission agent from 4-5-1980, the record proves otherwise and the society was functioning as a commission agent even prior to that date. Hence, in the absence of any cross-examination on this aspect during the trial, it will be difficult to accept the contention of the learned counsel. ( 32 ) NEXTLY, the learned counsel contended that unless there is positive evidence with regard to the quantity received by the society and the quantity available at the time of physical verification, the quantity of deficiency cannot be determined and in the absence of any proof, the court below gravely erred in decreeing the suit. Again, if we see the judgment of the trial court, learned Judge categorically recorded a finding that Defendant No. 2 (i. e.) President of the society did not dispute regarding the shortage of sugar nor contesting the evidence of P. W. 2 regarding the shortage of sugar and its value. ( 33 ) THE specific case of the plaintiff corporation is that though they might have stated that the society was functioning as commission agent from 4-5-1980 either wantonly or inadvertently, the fact remains that the supplies are being made from march, 1980 and according to them the sugar that was supplied during March, 1980 to November, 1981 was 14,767,20 qunitals and after deducting 13,950,30 quintals of sugar for which the society admittedly paid an amount of Rs. 45,15,029-98 Ps. the stock found in the godown (i. e.) 242. 91 quintals of sugar leaving a balance of 577. 99 quintals of levy of sugar. It is also to be kept in mind that the 2nd respondent President of the society from 1979 to end of 1982 (i. e.) the whole transaction has taken place during his tenure as President of the society. Hence, I cannot absolve him of his liability by raising these technical objections in the appeal having admitted his liability before the trial Court. Hence, I cannot absolve him of his liability by raising these technical objections in the appeal having admitted his liability before the trial Court. ( 34 ) LASTLY, Mr. M. N. Narasimha Reddy contended that the plaintiff Corporation is not justified in collecting liquidated damages at 200% of the wholesale issue price as penalty and such a clause is unreasonable and arbitrary without any reason. ( 35 ) HE also brought to the notice of the court that under Section 74 of Indian contract Act, the Court is bound to award reasonable compensation not exceeding the amount specified in the contract, but not to the maximum compensation fixed in the contract. ( 36 ) COUNTERING the above arguments, mr. N. Subba Reddy contended that this court should not forget the fact that at that time there was acute shortage of sugar and it was not available at fair price to the consumers. The sugar was included as one of the essential commodities and decided to supply to the consumers in limited quantities by subsidising the price. The question of pilferage will arise only when the sugar available in the open market at a higher price, may be at the prevailing market price or a little less. That is the reason why the agreement provides the payment of compensation twice the wholesale price. He also contended that when once the agreement specifies the compensation to liquidated damages, the Court shall not interfere with the agreement. In support of his contention, he cited a case reported in Oil and Natural Gas Corporation Ltd. , v. Saw pipes Ltd. In this case the respondent company agreed to supply 26th diameter and 30" diameter casing pipes to the appellant by its letter dated 27-12-1995. As per the terms and conditions of contract, the goods were required to be supplied on or before 14-11-1996. But the respondent company sought for extension of time for supply of the pipes on the ground that Italian suppliers were forced with labour problems and was unable to deliver the material as per the agreed schedule, and therefore, it sought for extension of time for 45 days. The appellant company extended the time with a specific statement that the amount equivalent to liquidated damages for delay in supply of pipes would be recovered from the respondent. Thereafter, the appellant company withheld liquidated damages. The appellant company extended the time with a specific statement that the amount equivalent to liquidated damages for delay in supply of pipes would be recovered from the respondent. Thereafter, the appellant company withheld liquidated damages. the issue was referred to the Tribunal, which held that the strikes affecting the supply of raw material to the claimant are not with the definition of "force majeure" in the contract between the parties, and hence, on that ground, it cannot be said that the amount of liquidated damages was wrongfully withheld by the appellant. But at the same time, the tribunal held that the appellant company failed to establish its case that it has suffered any loss in terms of money because of delay in supply of goods under the contract. Hence, the Arbitral Tribunal held that the appellant has wrongfully withheld the agreed amount. Questioning this award, the appellant company filed this appeal by contending that the award passed by the arbitrator is on the face of it illegal and erroneous as it arrived at the conclusion that the appellant was required to prove the loss suffered by it before recovering the liquidated damages. ( 37 ) CONSIDERING the scope of Section 74 of the Indian Contract Act, their Lordships of the Supreme Court having surveyed the case law, summarised the position in paragraph 68 of the Judgment, which is as follows:"68. From the aforesaid discussion, it can be held that: (1) Terms of the contract are required to be taken into consideration before arriving at the conclusion whether the party claiming damages is entitled to the same. (2) If the terms are clear and unambiguous stipulating the liquidated damages in case of the breach of the contract unless it is held that such estimate of damages/ compensation is unreasonable or is by way of penalty, party who has committed the breach is required to pay such compensation and that is what is provided in Section 73 of the contract Act. (3) Section 74 is to be read along with section 73 and, therefore, in every case of breach of contract, the person aggrieved by the breach is not required to prove actual loss or damage suffered by him before he can claim a decree. (3) Section 74 is to be read along with section 73 and, therefore, in every case of breach of contract, the person aggrieved by the breach is not required to prove actual loss or damage suffered by him before he can claim a decree. The court is competent to award reasonable compensation in case of breach even if no actual damage is proved to have been suffered in consequence of the breach of a contract. (4) ln some contracts, it would be impossible for the court to assess the compensation arising from breach and if the compensation contemplated is not by way of penalty or unreasonable, the court can award the same if it is genuine pre-estimate by the parties as the measure of reasonable compensation. ( 38 ) FOLLOWING the above judgment, it is seen that liquidated damages were specified in the contract itself and the person aggrieved by the breach is not required to prove actual loss or damage suffered by him before he can claim a decree for the specified liquidated damages. Though the court is given discretion to award reasonable compensation even if no actual damage has been suffered by the aggrieved party, in this case it is to be seen that the supplies of sugar was made in the year 1981 and till now the Corporation was not able to recover even a single paise from any of the defendants for over almost 23 years and the monies of the Corporation was locked up. Hence, it cannot be said that the Corporation has not suffered any damage because of breach of contract by the defendant. Hence, i am not inclined to exercise my discretion in reducing the compensation than what was specified in the agreement. ( 39 ) LASTLY, Mr. M. N. Narasimha Reddy brought to the notice of this Court that from the terms of the agreement itself the corporation is entitled to recover from the bills payable to the commission agents and the security deposits made by the commission agent or from the bank which has given guarantee if the security deposits fall short of such loss. As per the agreement, the society has given bank guarantee for rs. 10,0007- and as per the information furnished by the appellant, the same was encashed already. As per the agreement commission payable to the society for the sale of sugar an amount of Rs. As per the agreement, the society has given bank guarantee for rs. 10,0007- and as per the information furnished by the appellant, the same was encashed already. As per the agreement commission payable to the society for the sale of sugar an amount of Rs. 18,464/- was payable at the rate of Rs. 1. 25 per bag for 14,767. 20 bags. The plaintiff Corporation already paid an amount of Rs. 7,517. 50 Ps. on 27-1-1981 and Rs. 2,553. 75 ps. on 16-7-1981, in all Rs. 10,071. 25 Ps. Leaving balance of Rs. 8,392. 75 ps. This amount shall be deducted from the principal amount. Hence, the appellant is directed to deduct the amount of Rs. 8,392. 75 Ps. payable towards the commission to the defendant society from the principal amount payable by the society. The balance alone shall be recoverable by the society. It is made clear that the decree passed by this Court is joint and several in nature and it can be executed either against the society or the individuals concerned and if there are any internal disputes among them, it is always open to them to work out their remedies in accordance with law. ( 40 ) BEFORE parting with the case, I have no hesitation to hold that this suit was filed only as an eye wash and to overcome the audit objection in recovering the public monies that were misappropriated by the defendants. I am really unable to understand why the plaintiff Corporation waited till the amounts are accumulated and why they made supplies before the bills for the earlier supplies were cleared and accounted for contrary to the terms of the agreement. Further, the way in which they conducted the cases show that the Advocate who conducted the case, does not know the fundamentals of filing a suit and mark the documents, more so, secondary evidence. It is not known why the Advocate has not taken steps to call for the records from the police and marked the same. Further it is interesting to note that the officer- P. W. 2 of the plaintiff corporation practically conceded or pleaded the case of President by saying that the paid-Secretary alone is responsible for payment of amount. Admittedly, the bye- laws of the society were marked by the president much later to the evidence he has given in this case by recalling him. Admittedly, the bye- laws of the society were marked by the president much later to the evidence he has given in this case by recalling him. But, if we see the evidence of P. W. 2, it is seen that every word is spoken in favour the president. In fact, the Court relying, on his statement decreed the suit. It is also interesting to note that though offence was reported to the police way back in the year 1981 and the F. I. R. was registered in Crime no. 62 of 1982, I was told till this day not even the charge-sheet was filed. I do not know what type of evidence the investigating agency will collect in future. ( 41 ) ALL this will lead to the irresistible conclusion that these proceedings were initiated to save the skin of the officer and to shield the persons concerned in embezzling the public monies. It is for the Government to lake such steps that are available to save the public monies to prevent the swindling of public monies in this manner. ( 42 ) IN the result, the appeal is allowed and the suit is decreed against Defendant no. 2 also along with Defendants 1 and 3. It is made clear that this decree is joint and several in nature and it can be executed against any of the defendants. There shall be no order as to costs throughout.