Jayaprakasan K V v. Kerala State Financial Enterprises Limited and Others

**IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT** **THE HONOURABLE MRS. JUSTICE ANU SIVARAMAN** **FRIDAY, THE 20TH DAY OF SEPTEMBER 2019 / 29TH BHADRA, 1941** # **WP(C).No.37076 OF 2017(H)** ## **PETITIONER:** **JAYAPRAKASAN K V AGED 52 YEARS GENERAL MANAGER (FIANCE),CORPORATE OFFICE, KSFE,BHADRATHA, TRICHUR-680020** **BY ADV. SRI.S.B.PREMACHANDRA PRABHU** ## **RESPONDENTS:** - **1 KERALA STATE FINANCIAL ENTERPRISES LIMITED REPRESENTED BY ITS MANAGING DIRECTOR,'BHADRATHA', THRISSUR PIN-680020** - **2 THE CHAIRMAN OF BOARD OF DIRECTORS KERALA STATE FINANCIAL ENTERPRISES LTD, 'BHADRATHA', THRISSUR PIN-680020** - **3 ADDITIONAL CHIEF SECRETARY TO GOVERNMENT TAXES (H)DEPARTMENT, THIRUVANANTHAPURAMPIN-695001** - **4 SARATH CHANDRAN.S S/O. P.SAILENDRAN NAIR,49/1196C, JANANI, PONEKKARA ROAD,EDAPPALLY, KOCHI-682024** - **ADV. SRI.M.GOPIKRISHNAN NAMBIAR ADV. SRI.P.GOPINATH ADV. SRI.K.JOHN MATHAI ADV. SRI.JOSON MANAVALAN ADV. SRI.KURYAN THOMAS ADV. SRI.PAULOSE C. ABRAHAM ADV. SMT.REKHA VASUDEVAN** **SR. ADV. GOPINATHAMENON FOR KSFE** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 25-072019, THE COURT ON 20-09-2019 DELIVERED THE FOLLOWING:** **WP(C).No.37076 OF 2017(H) 2** ## **JUDGMENT** This writ petition is filed by the petitioner who had been appointed as General Manager(Finance) in the Kerala State Financial Enterprises Limited challenging Ext.P9 decision of the Board of Directors. 2. Heard Adv.S.B.Premachandra Prabhu, counsel for the petitioner, Adv. Gopinath Menon, Senior Counsel appearing for first and second respondents, Adv. Sunilkumar Kuriakose, Government Pleader as well as Adv.Rekha Vasudevan, counsel appearing for the fourth respondent. 3. It is submitted that the petitioner had been appointed as Senior Manager under the first respondent in the ## **WP(C).No.37076 OF 2017(H) 3** year 1993. He had been promoted as Assistant General Manager in the year 2008. Pursuant to a selection process, the petitioner was appointed as General Manager (Finance) by Ext.P1 order dated 25.4.2015. 4. It is submitted that on allegations of corruption, the fourth respondent had been proceeded against and his services were terminated by Exts.P3 and P4 decisions of the Board of Directors of the first respondent. By Ext.P5 dated 14.8.2014, the decision to dismiss the fourth respondent from service and directing the recovery of amounts misappropriated by him was duly intimated to the fourth respondent. 5. The fourth respondent had **WP(C).No.37076 OF 2017(H) 4** challenged the action of the first respondent before this Court by filing WP(C)No.23247 of 2014. It is stated that a detailed counter affidavit had been placed on record in the writ petition by the first respondent, justifying the decision and re-iterating the contentions against the fourth respondent. By Ext.P8 judgment, the writ petition was disposed of directing the second respondent consider the representation preferred by the fourth respondent against the order of dismissal and pass orders thereon. It is stated that, thereafter, in a meeting convened on 30.10.2017, the Board of Directors decided to re-instate the fourth respondent in service as General Manager (Finance). The said decision ## **WP(C).No.37076 OF 2017(H) 5** which is produced as Ext.P9 is under challenge in this writ petition. 6. The learned counsel for the petitioner would contend that Ext.P9 is clearly vitiated by extraneous consideration and that the reinstatement of the fourth respondent, by displacing the petitioner is completely unwarranted and unsustainable. It is contended that the petitioner had been appointed as General Manager (Finance) after undergoing a due selection procedure. It is stated that the petitioner is therefore a direct appointee to the post of General Manager (Finance) and there can be no reversion of the petitioner to a lower post. 7. A counter affidavit has been filed **WP(C).No.37076 OF 2017(H) 6** |on behalf of first and second| |---| |respondents. It is stated that the writ| |petition is not maintainable, since the| |appointment of the petitioner was| |specifically made subject to the out come| |of WP(C)No.23247/2014 and since the| |challenge<br>is<br>against<br>Exhibit<br>P9| |proceedings to which the petitioner is a| |complete stranger. The allegations of| |extraneous considerations are refuted and| |it is contended that the Board of| |Directors has taken an informed decision| |taking note of the factual and legal| |aspects of the matter. It is stated that| |the petitioner has no <br>_locus standi_<br>to| |challenge the decision. It is further| |submitted that the petitioner has been| |given protection of pay and is not in any| **WP(C).No.37076 OF 2017(H) 7** way affected by the decision taken to reinstate the 4th respondent. 8. The learned counsel for the first respondent would rely on the decision of the Apex Court in _**Zunjarrao Bhikaji**_ _**Nagarkar v. Union of India and others**_ _**[AIR 1999 SC 2881]**_ . It is contended that every error of judgment would not constitute a misconduct and there must be reasonable basis for the disciplinary authority to proceed against a delinquent officer. Negligence in quasi judicial adjudication, to be actionable, should be culpable negligence. 9. A counter affidavit has been placed on record by the fourth respondent contending that the petitioner is a complete stranger to the disciplinary ## **WP(C).No.37076 OF 2017(H) 8** proceedings initiated against him and that the petitioner has absolutely no _locus standi_ to challenge the decision taken by the Board of Directors on a representation preferred by the petitioner, seeking exoneration from the disciplinary proceedings. It is stated that Ext.P1 order of appointment of the petitioner itself would show that the appointment was specifically made subject to the result of WP(C)No.23247 of 2014 filed by the fourth respondent. It is stated that there was an interim order dated 12.1.2015 in WP(C)No.23247 of 2014 that appointment, if any, made to the post of General Manager(Finance) shall be subject to result of the writ petition. It is stated that situation is squarely ## **WP(C).No.37076 OF 2017(H) 9** covered by a Division Bench decision of this court in _**Sathyan Naravoor Vs. Union of India and Ors [2017 KHC 162]**_ **.** It is stated that a detailed report had been filed in the vigilance enquiry directed by the Enquiry Commissioner and Special Judge, Trissur as Ext.R4(C) which shows that the allegation against the fourth respondent were a result of victimization by the Managing Director. It is stated that by Ext.R4(B), the Enquiry Commissioner and Special Judge had found that there is no ground to proceed against the fourth respondent and no material was gathered to attract any of the offenses punishable under the Prevention of Corruption Act. It is stated that it was thereafter that the ## **WP(C).No.37076 OF 2017(H) 10** petitioner had submitted a representation before the second respondent and by Ext.P8 judgment dated 13.6.2017, the same was directed to be considered. It is stated that it is evident from Ext.P9 that all aspects of the matter had been taken into consideration by the second respondent while passing Ext.P9 order and that it is not open to the petitioner to challenge the decision. 10. A reply affidavit has been filed by the petitioner refuting the allegations and contenting that the allegations of corruption against the 4th respondent were serious in nature and that the order impugned is against the interest of the organisation, as also against public interest. ## **WP(C).No.37076 OF 2017(H) 11** 11. The challenge in this writ petition is raised against Ext.P9 decision of the Board of Directors of the first respondent company. It appears that the entire factual aspects of the matter had been considered by the Board. The resolution was to revoke the punishment of dismissal imposed on the fourth respondent and to reinstate him the service of General Manager(Finance). It was further resolved that the denial of salary and benefits for the entire period he was kept under dismissal would be imposed as a punishment on the fourth respondent. The fact that the post had been filled up on 16.4.2015 by appointing the petitioner herein through an open interview had also been considered. It ## **WP(C).No.37076 OF 2017(H) 12** was found that the appointment of the petitioner was specifically made subject to the out come of the writ petition filed by the fourth respondent. In the above view of the matter, the petitioner was directed to be relieved from the post of General Manager (Finance), and posted as Assistant General Manager. It was further decided to protect his present salary and emoluments by granting personal pay as necessary to make the salary equal to the pay he was drawing as General Manager (Finance). 12. A Division Bench of this Court in _**Sathyan Naravoor's Case (Supra)**_ had held, after referring to earlier decisions by the Apex Court, that the question of initiation or continuation of ## **WP(C).No.37076 OF 2017(H) 13** disciplinary proceedings against an employee is a matter which has to be considered by the employer and a stranger to the proceedings can have no right to challenge the decision taken by the employer to drop the disciplinary proceedings or to reinstate the employee. It was held by a Division Bench of this Court as follows:- _''37. In the instant case, the question as to whether disciplinary proceedings will have to be initiated against the 5th respondent or the proceedings already initiated has to be proceeded further is exclusively within the domain of the State. The appellant, who is admittedly a stranger, cannot be said to have any interest in such matters. Therefore, the appellant has no legal right to challenge Ext.P3 Confidential Verification Report obtained in the course of the disciplinary proceedings initiated_ **WP(C).No.37076 OF 2017(H) 14** _against the 5th respondent and also the conclusion of the competent authority in agreeing with the recommendation of the Enguiry Officer that no further action is required in the matter. For the very same reason, the appellant has no leagl right to challenge the action of the State Government in dropping the disciplinary proceedings initiated against the 5th respondent, by ratifying the action of the said respondent in taking up employment during the period of leave without Government permission and remitting the remuneration to the Management Institute, and deciding that no further action is required in the matter. Therefore, as rightly contended by the learned Advocate General, the challenge made in the writ petition against the action of the State Government in dropping the disciplinary proceedings against the 5th respondent, by ratifying the action of the said respondent in taking up employment during the period of leave without Government permission and remitting the remuneration to the Management Institute, is not legally maintainable.''_ ## **WP(C).No.37076 OF 2017(H) 15** 13. Though it is contended by the learned counsel for the petitioner that the petitioner is not a stranger to the proceedings since he is directly affected by the outcome of Ext.P9, I am of the opinion that since the initial appointment of the petitioner itself was subject to outcome of WP(C)No.23247 of 2014, the contention that he was directly affected and has a right to challenge Ext.P9 is completely misplaced. Moreover, the petitioner who had been treated as a direct appointee to the post has not been thrown out of service. He has been accommodated in the post of Assistant General Manager and has even been granted protection of pay that he was drawing as General Manager (Finance). **WP(C).No.37076 OF 2017(H) 16** The prayers sought for in the writ petition, therefore, cannot be granted. The Writ Petition is accordingly dismissed. SD/- **ANU SIVARAMAN** **JUDGE** ACM **WP(C).No.37076 OF 2017(H) 17** ## **APPENDIX** **PETITIONER'S/S EXHIBITS:** **EXHIBIT P1: TRUE COPY OF THE APPOINTMENT ORDER GIVEN TO THE PETITIONER DATED 25.4.2015** **EXHIBIT P2: TRUE COPY OF THE ENQUIRY REPORT DATED 3.7.2014** **EXHIBIT P3: TRUE COPY OF THE BOARD DECISION OF THE 2ND RESPONDENT DATED 13.8.2014** **EXHIBIT P4; TRUE COPY OF THE BOARD DECISION OF THE 2ND RESPONDENT DATED 29.8.2014** - **EXHIBIT P5: TRUE COPY OF THE MEMO GIVEN BY THE 1ST RESPONDENT TO THE 4TH RESPONDENT DATED 14.8.2014** - **EXHIBIT P6: TRUE COPY OF THE COUNTER AFFIDAVIT FILED BY THE KERALA STATE FINANCIAL ENTERPRISES LTD IN WPC NO.23247/2014 (WITHOUT THE EXHIBITS) DATED 17.11.2014** - **EXHIBIT P7: TRUE COPY OF THE REPLY GIVEN BY THE 1ST RESPONDENT TO THE 3RD RESPONDENT DATED 31.12.2016** **EXHIBIT P8: TRUE COPY OF THE JUDGMENT OF THIS HON'BLE COURT IN WPC NO.23247/2014 DATED 13.6.2017** **EXHIBIT P9:** **TRUE COPY OF THE RELEVANT EXTRACT OF THE BOARD DECISION DATED 30.10.2017** **WP(C).No.37076 OF 2017(H) 18** **EXHIBIT P10** **TRUE COPY OF THE ASSEMBLY COMMITTEE REPORT.** **RESPONDENT'S EXHIBITS :-** - **EXHIBIT R4(A)** **EXHIBIT R4(B)** **EXHIBIT R4(C)** **EXHIBIT R4(D)** **EXHIBIT R4(E)** **TRUE COPY OF THE INTERIM ORDER DATED 12.1.2015 IN WP(C)NO.23247 OF 2014 OF THIS HONOURABLE COURT** **TRUE COPY OF THE REPORT SUBMITTED BY THE FINANCE INSPECTION TEAM DATED 7.6.2018 ALONG WITH THE FORWARDING LETTER DATED 4.8.2018** - **TRUE COPY OF THE REPORT DATED 24.10.2017 SUBMITTED BY THE DEPUTY SUPERINTENDENT OF POLICE, VACB THRISSUR** - **TRUE COPY OF THE ORDER DATED 30.8.2018 IN CRIMINAL MP 550/2017 OF THE HONOURABLE ENQUIRY COMMISSIONER AND SPECIAL JUDGE, THRISSUR** - **TRUE COPY OF THE ORDER BEARING REF NO.50962 DATED 24.11.2017 ISSUED BY THE MANAGING DIRECTOR OF THE 1ST RESPONDENT.**