Shaji Sebastian v. Kerala Malanadkarsheka Produce Co-operative Society Limited & Ors

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** # **PRESENT** **THE HONOURABLE MR.JUSTICE C.T.RAVIKUMAR** ## **&** **THE HONOURABLE MR. JUSTICE K.HARIPAL** **FRIDAY, THE 09TH DAY OF APRIL 2021 / 19TH CHAITHRA, 1943** ## **WA.No.274 OF 2021** **AGAINST THE JUDGMENT DATED 19.11.2020 IN WP(C) 9100/2016(J) OF HIGH COURT OF KERALA** ## **APPELLANT/2ND RESPONDENT:** **SHAJI SEBASTIAN AGED 49 YEARS S/O.SEBASTIAN, CHETTANIYIL HOUSE, KOODATHAYI BAZAR, KOZHIKODE-673603.** **BY ADVS. SRI.GEORGE POONTHOTTAM (SR.) SMT.M.MANJU SRI.R.SUDHISH** ## **RESPONDENTS/PETITIONER & RESPONDENTS 1 & 3:** **1 KERALA MALANADKARSHAKA PRODUCE CO-OPERATIVE SOCIETY LIMITED NO.F-1777 REPRESENTED BY ITS SECRETARY, THIRUVAMBADY.P.O, KOZHIKODE-673603.** **2 THE KERALA CO-OPERATIVE TRIBUNAL, THIRUVANANTHAPURAM-695001.** W.A.No.274 of 2021 2 **3 PRASHANTH KUMAR.P.N, S/O NARAYANAN NAIR, PUTHIYOTHIL HOUUSE, THIRUVAMBADI.P.O, KOZHIKODE-673603.** **R1 BY ADV. SRI.P.RAVINDRAN (SR.) R1 BY ADV. SRI.T.R.HARIKUMAR R2 BY SPL.G.P.SRI.MOHAMAD HASHIM** **THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 09-04-2021 THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** W.A.No.274 of 2021 3 ## **JUDGMENT** ## **Ravikumar, J.** This intra-court appeal is filed by the 2[nd] respondent in W.P.(C)No.9100 of 2016 on being aggrieved by the judgment dated 19.11.2020 passed thereon. The writ petition was filed by Kerala Malanad Karshaka Produce Co-operative Society Ltd. No.F-1777, the first respondent herein, seeking the following relief:- “to call for the records leading to the issuance of Exhibit-P6 order and set aside the same to the extent it directs the society to reinstate the 2[nd] respondent within three days from the date of receipt of the order.” The writ petition was disposed of as per the impugned judgment with the following directions:- - “1) The committee of the petitioner Society shall issue memo of charges to the 2[nd] respondent and the disciplinary proceedings shall be completed within a period of three months from the date of receipt of a copy of this judgment. - 2) The 2[nd] respondent shall make an application for subsistence allowance producing a non employment certificate, within a period of two weeks from today. If such an application is filed, it will be considered and orders passed without delay. The amount of subsistence allowance found due shall be released within one month from the date of receipt of a copy of this judgment.” W.A.No.274 of 2021 4 Obviously, the second respondent feels aggrieved by the said directions and seeks for dismissal of the writ petition by allowing the writ appeal. 2. A succinct narration of facts is required for a proper disposal of this appeal. The appellant while working as the Secretary of the first respondent Society was placed under suspension on 22.12.2009 in contemplation of disciplinary proceedings. It pertains to alleged irregularity and misappropriation in issuing cheques worth Rs.40,55,000/- and grant of permission for drawal of money other than through the account of the account holder. Subsequently, a three member disciplinary committee was constituted by the Managing Committee of the Society and the said disciplinary committee sought explanation from the appellant in respect of the allegations on irregularities and misappropriation allegedly occurred during the period from 2007 to 2009. Dissatisfied with the explanation the subcommittee ordered domestic enquiry and appointed an enquiry officer and the same was approved by the Managing Committee on 2.6.2010. In the enquiry conducted thereafter the charges framed against the appellant were held as proved and a report in that regard was submitted to the sub-committee on 22.10.2010. Based on the same a show cause notice was issued to the appellant along with copy of the W.A.No.274 of 2021 5 enquiry report. The disciplinary proceedings ultimately culminated in an order dismissing the appellant from service with effect from 22.12.2009 viz., the date on which he was suspended. The appellant filed a statutory appeal before the Board of Directors of the Society challenging the order of the sub-committee. The matter was remanded by the Board of Directors to the disciplinary sub-committee for considering the matter afresh. The appellant filed ARC.No.169 of 2011 challenging the orders of the sub-committee and also that of the Board of Directors contending that there was no quorum for considering the appeal by the appellate authority viz., the Board of Directors. Pending the Arbitration Case the sub-committee issued show cause notice to the appellant and after affording an opportunity of being heard he was dismissed from service as per proceedings dated 27.4.2011. Later, the Arbitrator held the Arbitration Case as not maintainable on the ground that the appellant herein ought to have availed the statutory remedy of appeal against the said proceedings dated 27.4.2011, as per Ext.P1 order dated 18.11.2014. Against the said award in ARC.No.169 of 2011 the appellant preferred an appeal under Section 82 of the Kerala Cooperative Societies Act before the Kerala Co-operative Tribunal. The Tribunal allowed the appeal as per Ext.P2 judgment on the following lines:- W.A.No.274 of 2021 6 - “1. Declared that the Ext.B44 order dated 23-03-2011 passed by the Board of Management in the statutory Appeal filed by the Plaintiff is null and void and is set aside. 2. Declared that Ext.B42 order passed by disciplinary subcommittee on 18-01-2011 as null and void and that order is set aside. 3. The disciplinary subcommittee of 1[st] respondent is directed to consider the explanation of Plaintiff regarding the acceptability and legality of the domestic enquiry report, the correctness of the finding of guilt of the Plaintiff in the report and other objections regarding the enquiry on a judicious application of its mind on the basis of evidence and legal principles and pass a considered and speaking order after hearing the Plaintiff and Defendant. 4. If copy of the enquiry report is not served to Plaintiff, serve him a copy and give him an opportunity to file his objection. 5. Subcommittee shall issue notice to Plaintiff for appearance before it and pass the order in the enquiry as per law. 6. Subcommittee shall take a decision in the enquiry as directed above and in accordance with law within one month from the dae of receipt of copy of this judgment. 7. While taking the decision, the Subcommittee shall pass an order whether Plaintiff is entitled to reinstatement in service with back wages and continuity in service.” 3. Subsequent to Ext.P2 judgment, the Managing Committee of the Society, with a view to implement Ext.P2 judgment of the Tribunal, took decisions on 9.1.2016 to constitute a disciplinary sub-committee consisting of three of its members and to file an application seeking extension of time for compliance with the directions W.A.No.274 of 2021 7 in Ext.P2, by six months. In tune with the said decision I.A.No.3 of 2016 was filed in A.P.No.95 of 2014 on 14.1.2016 seeking extension of time by six months before the Tribunal. That application was allowed by the Tribunal as per Ext.P6 as hereunder:- - “1. Application allowed with a direction to Applicant to pass orders to reinstate the Respondent in service of Applicant Society subject to the result of disciplinary enquiry within three days from the date of receipt of this order and allow Respondent to join service of applicant within three days from the date of order of Applicant and to complete the disciplinary proceedings within six months. 2. On failure Respondent is at liberty to initiate all legal proceedings against the Applicant, its Secretary and Members of disciplinary subcommittee for disobedience of the directions in the judgment of this Tribunal in A.P.No.95/2014 dated 28.11.2015 and the order in this application.” 4. It is challenging Ext.P6 order that W.P.(C)No.9100 of 2016 was filed and the learned Single Judge after hearing rival contentions and perusing the materials on record disposed of the writ petition with the afore-extracted directions. It is the said judgment that is under challenge in this appeal. 5. Heard Sri.George Poonthottam, the learned Senior Counsel appearing for the appellant, the learned Senior Counsel Sri.P.Raveendran appearing for the first respondent and also the W.A.No.274 of 2021 8 learned Special Government Pleader Sri.Mohamad Hashim. 6. The core contention of the appellant is that by giving a direction to the first respondent society to issue fresh memo of charges to him and to complete the disciplinary proceedings within a period of three months from the date of receipt of copy of the judgment the writ court had virtually given an opportunity to the society to fill up the lacuna in the proceedings. His further contentions as revealed from grounds A, B & C are as follows: “A. the judgment of the learned single Judge directing the Committee of the Society to issue memo of charges to the 2[nd] respondent and the disciplinary proceedings shall be completed within a period pf 3 months from the date of receipt of a copy of judgment is illegal, improper, unjustifiable and against the pleadings and prayer of the writ petition. Hence, the same is liable to be set aside. There was no such case for the writ petitioner in the writ. B. The learned Single Judge ought to have direct the petitioner Society to reinstate the 2[nd] respondent in the Service of Society as ordered by the Co-operative Appellate Tribunal in order dated 12.1.2016 in I.A. No 3 of 2016 in A.P. No 95 of 2014. C. the learned Single Judge failed to consider the Exhibit P2 Judgment in Appeal No. 95 of 2014 of the Kerala Co-opeartive Tribunal. The Appellate Tribunal declared the order passed by the Board dated 23.3.2011 is null and void and is set aside and also declared the Order passed by the disciplinary committee on 18.1.2011 as null and void and the same is set aside. Therefore the appellant who was W.A.No.274 of 2021 9 kept out of service under suspension for more than 1 year is liable to be reinstated as directed by the impugned Exhibit P6 order.” It is the further contention that taking note of the fact that the appellant has been out of service since 22.12.2009 the learned Single Judge ought to have directed the society to reinstate him in service as ordered by the Co-operative Tribunal in the order dated 12.1.2016 in I.A.No.3 of 2016 in Appeal No.95 of 2014. The respondents strongly resisted the claims and contentions of the appellant. 7. We have already narrated the chronology of events which ultimately culminated in the impugned judgment. The charges against the appellant were pertaining to the alleged irregularity and misappropriation in issuing cheques worth Rs.40,55,000/- and permitting drawal of money other than through the account of the account holder during the period 2007-2009 while he was working as the Secretary of the society. The disciplinary proceedings initiated, initially culminated in his dismissal from service. The statutory appellate authority viz., the Board of Directors of the society set aside the order and remanded the matter to the disciplinary sub-committee for considering the matter afresh. The challenge against the order of dismissal as also the order of the Board of Directors in W.A.No.274 of 2021 10 ARC.No.169/2011 turned futile and the arbitration case was held as not maintainable. The challenge against the order in the said ARC culminated in Ext.P2 judgment of the Kerala Co-operative Tribunal and thereafter Ext.P6 order was passed in I.A.No.3/2016 filed in the said appeal. The learned Single Judge as per the impugned judgment directed the Committee of the society to issue memo of charges to the appellant and also to complete the disciplinary proceedings within three months from the date of receipt of copy of the judgment. It is in the said circumstances that the appellant has raised the aforementioned grounds to challenge the judgment of the learned Single Judge. While considering the challenge it is relevant to refer to the indisputable and undisputed position revealed from the materials on record that the memo of charges in respect of the alleged incident which led to the initiation of disciplinary proceedings, was issued by the disciplinary subcommittee constituted by the Managing Committee and not by the Managing Committee of the society. Evidently, the learned Single Judge issued the direction to the Committee of the society to issue memo of charges taking into account the said indisputable and undisputed factual position in the light of the Division Bench decision of this Court **-** in **Kodenchery Service Co operative Bank Ltd.** v. **Joshy Varghese** reported in **2020 (4) KLT 129** . In the said decision in which one of us W.A.No.274 of 2021 11 (C.T.Ravikumar, J) was a party, the Division Bench held that the provision under Rule 198(2A) of the KCS Rules empowers only the Committee of a society, which is the appointing authority of its employees, to issue memo of charges and the provision under Rule 198(2B) of the KCS Rules empowers the disciplinary sub-committee so constituted by the Committee to inquire into the charges against the employee concerned, either by itself or by engaging an external agency. Ergo, framing and issuance of charge memo by the disciplinary subcommittee constituted by the Committee of the society is wholly invalid, as held by the learned Single Judge. The Writ Court also held that the failure on the part of the delinquent employee to raise objection against the issuance of memo of charges by the disciplinary sub-committee or his participation in the disciplinary proceedings are inconsequential and such action/omission could not validate the proceedings based on such charge memo issued by the disciplinary sub-committee. We also find no error or illegality in the said finding as the disciplinary subcommittee was incompetent to issue memo of charges. 8. In the context of the decision in **Joshy Varghese'** case (supra) and the factual aspects obtained in the instant case it is relevant to refer to the decision of the Hon'ble Apex Court in **Murthy** v. W.A.No.274 of 2021 12 **State of Karnataka ((2003) 7 SCC 517)** . The ratio of the said decision is that the exposition of law by the Hon'ble Apex Court on any particular issue has to be treated as the law from the inception and has to be applied in pending matters irrespective of the stage of the proceedings. Applying the said position the Writ Court cannot be found fault with in applying the dictum in **Joshy Varghese'** case (supra) to hold that the disciplinary sub-committee was incompetent to issue memo of charges and in other words, issuing direction to the Committee of the society to issue memo of charges and to ensure completion of the disciplinary proceedings within the time stipulated in the judgment. In such circumstances, once the Committee of the society issues the memo of charges necessarily the task of enquiring into the charges either by itself or by engaging an extenal agency would be that of the disciplinary sub-committee constituted by the Managing Committee. In view of the said legal position obtained in this case we find absolutely no error or illegality in the judgment of the learned Single Judge in issuing direction to the committee of the society to issue memo of charges to the appellant and to complete the disciplinary proceedings within the stipulated time. It is to be noted that now, in this case, pursuant to the impugned judgment of the Writ Court memo of charges was issued by the Committee and a disciplinary W.A.No.274 of 2021 13 sub-committee has been constituted to inquire into the charges. 9. We will now consider the contention of the appellant that in the circumstances obtained in the case the learned Single Judge ought to have ordered for reinstatement of the appellant into the service of the society as ordered by the Co-operative Appellate Tribunal in Ext.P6 order in I.A.No.3 of 2016 in A.P.No.95 of 2014. As noticed hereinbefore, earlier the appellant was dismissed from service as per order of the disciplinary sub-committee. However, the same was interfered with and the matter was remanded for fresh consideration by the statutory appellate authority namely, the Board of Directors of the society. Continuance of the disciplinary proceedings subsequent to the said order would undoubtedly indicate that the appellant is still within the disciplinary control of the employer namely, the society. Obviously, the claim of the appellant for reinstatement is founded on sub-rule (6) of Rule 198 of the KCS Rules. In this context, it is also relevant to note that as per the impugned Ext.P6 order in I.A.No.3/2016 in A.P.No.95/2014 the Co-operative Tribunal directed the first respondent society to reinstate the appellant. The respondents herein would contend that as long as in Ext.P2 judgment of the Tribunal there was no positive direction to reinstate the appellant into the service of the W.A.No.274 of 2021 14 society and what was directed thereunder was to consider and pass orders by the disciplinary sub-committee on the entitlement of the appellant for reinstatement in service with backwages and continuity in service the Tribunal was not empowered and therefore, legally not justified in issuing a positive direction for reinstatement of the appellant in an interlocutory application filed in the disposed appeal viz., in Ext.P6 order in I.A.No.3 of 2016 in A.P.No.95 of 2014. True that the learned Single Judge considered the contention of the appellant herein for reinstatement but found that Ext.P2 judgment of the Tribunal had become final and as per the same even after setting aside the orders of the disciplinary sub-committee and the orders passed in appeal by the Managing Committee the Tribunal declined the request for reinstatement with backwages. It was also observed in paragraph 8 of the impugned judgment that the order of reinstatement issued by the Tribunal as per Ext.P6 was stayed by this Court and the said order was in force till 19.11.2020, the date of disposal of the writ petition. But then, the fact is that relying on the decision in **Joshy Varghese** case (supra) the learned Single Judge directed the committee of the society to issue memo of charges to the appellant. There can be no doubt with respect to the position that one can only say that disciplinary proceeding is initiated only on the issuance of memo of charges to the W.A.No.274 of 2021 15 delinquent employee. But then, the fact obtained in the case is that disciplinary proceedings were actually initiated against the appellant and it entered in its logical conclusion, but it was interfered with. He was placed under suspension as early as on 22.12.2009. We are of the considered view that taking into account all the aforesaid circumstances and the rival contentions the question of reinstatement has to be considered. This issue was not actually pointedly posed for consideration and considered by the writ court. In the said circumstances, leaving open the factual and legal contentions on the said issue to be raised by both sides and without making any observation on the same the matter is remanded to the writ court to decide only on the entitlement or otherwise of the appellant herein for reinstatement into the service of the society pending disciplinary proceedings. Ordered accordingly. The appeal stands disposed of as above. Sd/- **Judge** **C.T.RAVIKUMAR** Sd/- **K.HARIPAL Judge** TKS