Vijayakumar v. Adat Farmers Service Co-Operative Bank Ltd. and others

**IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT:** **THE HONOURABLE MR. JUSTICE ANIL K.NARENDRAN** **TUESDAY, THE 3RD DAY OF JULY 2018 / 12TH ASHADHA, 1940** **WP(C).No. 1465 of 2018** ## **PETITIONER** **VIJAYAKUMAR. K KEEZHCHERY HOUSE, PURANATTUKARA P.O., THRISSUR DISTRICT -680 551.** **BY ADVS.SRI.V.G.ARUN SRI.T.R.HARIKUMAR** ## **RESPONDENTS** **1. THE ADAT FARMERS SERVICE CO-OPERATIVE BANK LTD. NO.R 689 REPRESENTED BY ITS MANAGING DIRECTOR, PURANATTUKARA P.O, THRISSUR DISTRICT-680 551.** **2. THE ADMINISTRATIVE COMMITTEE OF THE ADAT FARMERS SERVICE CO-OPERATIVE BANK LTD. NO. R 689, REPRESENTED BY ITS CONVENER, PURANATTUKARA P.O, THRISSUR DISTRICT-680 551.** **3. THE REGISTRAR OF CO-OPERATIVE SOCIETIES THIRUVANANTHAPURAM -695 001.** **4. STATE OF KERALA REPRESENTED BY THE SECRETARY TO GOVERNMENT, CO-OPERATION (C) DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM-695 001.** **R1 AND R2 BY SRI.P.C.SASIDHARAN, SC R3,R4 BY SENIOR GOVERNMENT PLEADER SRI.K.P. HARISH** **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 03-07-2018,THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **mks 11/07/2018** **WP(C).No. 1465 of 2018 (G)** ## **APPENDIX** ## **PETITIONER(S)' EXHIBITS** - **EXHIBIT P1 A TRUE COPY OF THE NOTICE ISSUED BY THE 1ST RESPONDENT DATED 04.07.2017 EXHIBIT P2 A TRUE COPY OF THE SUSPENSION ORDER DATED 11.07.2017 ISSUED BY THE 1ST RESPONDENT EXHIBIT P3 A TRUE COPY OF THE MEMO OF CHARGES AND STATEMENT OF ALLEGATIONS ALONG WITH COVER LETTER DATED 11.08.2017 EXHIBIT P4 A TRUE COPY OF THE EXPLANATION TO THE MEMO OF CHARGES SUBMITTED BY THE PETITIONER DATED 02.09.2017 EXHIBIT P5 A TRUE COPY OF THE NOTICE DATED 24.10.2017 ISSUED BY THE 1ST RESPONDENT EXHIBIT P6 A TRUE COPY OF THE DISMISSAL ORDER DATED 14.11.2017 ISSUED BY THE 2ND RESPONDENT EXHIBIT P7 A TRUE COPY OF THE APPEAL PETITION FILED BY THE PETITIONER DATED 27.11.2017. EXHIBIT P8 A TRUE COPY OF THE COMMUNICATION DATED 09.12.2017 ISSUED BY THE 1ST RESPONDENT.** ## **RESPONDENTS EXHIBITS** ## **NIL** ## **/TRUE COPY/** **P.S. TO JUDGE** **mks 11/07/2018** ## **ANIL K.NARENDRAN, J.** ## **================= W.P.(C).No.1465 of 2018** ## **====================== Dated this the 03[rd] day of July, 2018** ## **J U D G M E N T** The petitioner, who was working as Accountant-incharge/Branch Manager of Rice Mill Branch of the 1[st] respondent Co-operative Bank has filed this writ petition under Article 226 of the Constitution of India, seeking a writ of certiorari to quash Ext.P6 order of dismissal dated 14.11.2017, issued by the 2[nd] respondent Administrative Committee, and Ext.P8 communication dated 09.12.2017, issued by the 1[st] respondent Co-operative Bank, which is a Co-operative society registered under the Kerala Co-operative Societies Act, 1969 (for brevity, 'the Act'). The petitioner has also sought for a writ of mandamus commanding 2[nd] respondent to consider and pass orders on Ext.P7 appeal filed against Ext.P6 order of dismissal, expeditiously. 2. On 16.01.2018, when this writ petition came up for W.P.(C) .No.1465 of 2018 2 admission, the learned counsel for 1[st] respondent Bank and also the learned Government Pleader for respondents 3 and 4 sought time to get instructions. 3. A counter affidavit has been filed on behalf of the 2[nd] respondent, contending that, in view of the proviso to subrule (5) of Rule 198 of the Kerala Co-operative Societies Rules, 1969 (for brevity, 'the Rules'), an appeal against Ext.P6 order of dismissal can be entertained only by the elected committee. Ext.P7 appeal preferred before the Convenor of the Administrative Committee is not maintainable, since Ext.P6 order of dismissal is one issued by that Administrative Committee. 4. The issue to be decided in this writ petition is what is the remedy open to the petitioner to challenge Ext.P6 order of dismissal issued by the 2[nd] respondent Administrative Committee of the 1[st] respondent Bank. 5. Rule 198 of the Kerala Co-operative Societies Rules deals with disciplinary action. Sub-rule (1) of Rule 198 provides that, any member under the establishment of a Co- W.P.(C) .No.1465 of 2018 3 operative Society may, for good and sufficient reasons, be punished by imposing penalty enumerated in clauses (a) to (h). As per sub-rule (3) of Rule 198, the authority competent to impose various penalties on different categories of employees shall be as shown in the table below that sub-rule. As per sub-rule (4) of Rule 198, an appeal shall lie against every order imposing a penalty to the competent appellate authority, as shown in the table below that sub-rule. 6. In the case of employees of the rank of Secretary/Manager or other Chief Executive Officer and all employees holding posts higher than Senior Clerk/Senior Assistant/First Grade Assistant/equivalent other employees with same or identical scale of pay, the authority competent to impose penalties under clauses (d) to (h) of sub-rule (1) of Rule 198 is the Sub-committee/ Executive Committee; and the authority competent to dispose of the appeal filed against order such is the Board of every imposing penalty Management. Sub-rule (5) of Rule 198 provides that, no appeal shall be entertained, if it is preferred within a period of W.P.(C) .No.1465 of 2018 4 three months from the date of the order imposing penalty. However, going by the proviso to sub-rule (5), where the penalty is imposed on an employee by an Administrator or an Administrative Committee, such employee can file appeal before the forthcoming elected committee and in such cases, the restriction of three months shall not be applicable. 7. The fact that the 1[st] respondent Bank is presently managed by an Administrative Committee, is not in dispute. The elected Managing Committee of the 1[st] respondent Bank was superseded under Section 32 of the Kerala Co-operative Societies Act, 1969 (for brevity 'the Act') and an Administrator was appointed, who was later replaced by an Administrative Committee consisting of three officers, after finalisation of the proceedings initiated under Section 32 of the Act. 8. A reading of the provisions of Rule 198 of the Rules, especially sub-rules (4) and (5) would show that, if there is no elected committee and the affairs of the Society is being managed by the Administrator/Administrative Committee, the employee can file appeal before the forthcoming elected W.P.(C) .No.1465 of 2018 5 committee, as provided in the proviso to sub-rule (5) of Rule 198, and in such cases the restriction of three months period prescribed in sub-rule (5) of Rule 198 has no application. 9. In the instant case, the 1[st] respondent Bank is the Administrator and thereafter an managed by by Administrative Committee, for nearly two years. Ext.P5 order of dismissal is one issued by the 2[nd] respondent Administrative Committee. Therefore, the petitioner cannot file an appeal under sub-rule (4) of rule 198 of the Rules before the 2[nd] respondent Administrative Committee, since the said Committee which had exercised the powers of the disciplinary authority cannot exercise the powers of the appellate authority, insofar as Ext.P6 order of dismissal is concerned. 10. In **Mathewkunju v. Registrar of Co-operative Societies (2000 (1) KLT 817)** , a decision relied on by the learned counsel for the petitioner, this Court held that there is nothing preventing the Administrator from hearing the appeal filed by an employee under Sub-rue (4) of Rule 198 of W.P.(C) .No.1465 of 2018 6 the Rules. In the said case, the disciplinary proceedings initiated against respondents 4 to 6 therein, who were employees of the Kerala State Co-operative Marketing Federation Ltd, culminated in imposing punishment by the disciplinary authority competent as per sub-rule (3) of Rule 198, to impose the penalties under clauses (d) to (h) of subrule (1) of Rule 198 of the Rules. The 4[th] and 6[th] respondents were permitted to retire from service voluntarily and the 5[th] respondent was dismissed from service. They filed appeal before the Managing Committee of the Federation, under sub-rule (4) of Rule 198. On 25.01.1999, the appeals were considered by the Board and it was decided to give personal hearing. Since the committee was superseded on 27.01.1999, the same could not be given. The question before this Court was whether the Administrator, who is to exercise all the functions of the Board of Management, can dispose of the appeal. This court held that, sine the Administrator comes into play when the Board of Management was superseded, to exercise the functions of the Board of Management, there is W.P.(C) .No.1465 of 2018 7 nothing preventing the Administrator from hearing the appeals which were pending before the Board of Management. Paragraph 10 of the said judgment reads thus; “10. The provisions of R. 188 deals with disciplinary proceedings with regard to the employees of the society. These provisions have been introduced by virtue of the power given under S. 109 of the Cooperative Societies Act. The rules prescribe the various authorities, who are to pass orders regarding the punishments and also stipulates the Appellate Authority, who are to hear such matters. These authorities, according to me, are the creations of the Rules. By virtue of the Rules, the Original Authority and the Appellate Authority are given the function on duty to hear disciplinary matters against the employees. In many cases, function is given to the Board of Management, because it is the ultimate body. It is not given to the Board of Management by virtue of any power given by the General Body or by the Bye-laws. It is only given by the Rules. The Board of Management is a fluctuating body. After the term of a particular Board is over, another Board may be constituted. The administrator comes into when the Board of was play Management superseded to exercise the functions of the Board of Management. I see no reason why the appellate W.P.(C) .No.1465 of 2018 8 power to be exercised by the Board of Management cannot be exercised by the administrator. There is no policy involved in these matters. Admittedly, the administrator is to hear appeals against the order of the Lower Authority and the duty of the Appellate Authority is to find out whether the order passed by the Lower Authority is correct in accordance with law and if it is wrong, set aside and pass orders according to law. Hence I am of the view that there is nothing preventing the administrator from hearing the appeals. It was then submitted that the administrator is appointed by the Government or Registrar and in many cases his actions are not impartial. I don't think, this general accusation can be taken into account in the interpretation of R. 198 of the Co-operative Societies Rules. Suffice it to say if in the exercise of such appellate power, the administrator does not act impartially or bonafide, then it is always for the Registrar to correct such orders under his powers in view of R. 176 of the Cooperative Societies Rules.” 11. In the instant case, the 2[nd] respondent Administrative Committee had exercised the of the already power disciplinary authority, while issuing Ext. P6 order of dismissal. Therefore, the said committee cannot exercise the power of W.P.(C) .No.1465 of 2018 9 the appellate authority under sub-rule (4) of Rule 198 of the Rules. At the same time, an employee of the 1[st] respondent Bank, who has been awarded with a major penalty of reduction to a lower rank or compulsory retirement or dismissal from service, ie., penalties specified under clauses (f) to (h) of sub-rule (1) of Rule 198 cannot be denied an opportunity to challenge that order, before an appropriate forum, within a reasonable time. 12. The appellate authority under sub-rule (4) of Rule 198 is a fact finding authority, which has to consider the entire questions arising on facts, by examining the evidence and other materials on record. It is a well settled principle of law that this Court exercising the power of judicial review under Article 226 of the Constitution of India does not act as an appellate authority, as judicial review is not akin to adjudication of merit by re-appreciating the evidence as an appellate authority. 13. In **Government of Andhra Pradesh and Others** v. **Mohamed Nasrullah Khan [(2006) 2 SCC 373],** the Apex W.P.(C) .No.1465 of 2018 10 Court held that the jurisdiction of this Court under Article 226 of the Constitution is circumscribed and confined to correct errors of law or procedural error, if any, resulting in manifest miscarriage of justice or violation of principles of natural justice. 14. In **Mahalingam R.** v. **Chairman, TNPSC [(2013) 14 scc 379]** the Apex Court reiterated that the scope of judicial review in matters involving challenge to the disciplinary action taken by the employer is very limited. The Courts are primarily concerned with the question whether the enquiry has been held by the competent authority in accordance with the prescribed procedure and whether the rules of natural justice have been followed. The Court can also consider whether there was some tangible evidence for proving the charge against the delinquent and such evidence reasonably supports the conclusions recorded by the competent authority. If the Court comes to the conclusion that the enquiry was held in consonance with the prescribed procedure and the rules of natural justice and the conclusion W.P.(C) .No.1465 of 2018 11 recorded by the disciplinary authority is supported by some tangible evidence, then there is no scope for interference with the discretion exercised by the disciplinary authority to impose the particular punishment except when the same is found to be wholly disproportionate to the misconduct found proved or shocks the conscience of the Court. 15. As per clause (c) of sub-section (1) of Section 69 of the Act, if a dispute arises between the society or its committee and any past committee, any officer, agent or employee or any past officer, past agent or past employee or the nominee, heirs or legal representatives of any deceased officer, deceased agent or deceased employee of the society, such dispute can be referred to the Co-operative Arbitration Court constituted under Section 70A of the Act, in the case of non-monetary disputes, and the said court shall decide such dispute, and no other court or authority shall have jurisdiction to entertain any suit or other proceedings in respect of such dispute. As per clause (d) of sub-section (2) of Section 69, any dispute arising in connection with employment of officers and W.P.(C) .No.1465 of 2018 12 servants of the different classes of societies specified in subsection (1) of Section 80, including their promotion and inter- se seniority, shall also be deemed to be disputes, for the purpose of sub-section (1) of Section 69 of the Act. 16. Therefore, in a case where an employee of a Cooperative Society is imposed with a major penalty of reduction to a lower rank or compulsory retirement or dismissal from service, i.e, penalties specified under clauses (f) to (h) of sub-rule (1) of Rule 198 of the Kerala Co-operative Societies Rules, by the Administrator/Administrative Committee, by exercising the power of the disciplinary authority under sub-rule (3) of Rule 198, such an employee can, in the absence of an appellate authority competent to entertain an appeal under sub-rule (4) of Rule 198, approach the Co-operative Arbitration Court constituted under Section 70A of the Act challenging such order of reduction to a lower rank or compulsory retirement or dismissal from service, invoking Section 69 of the Act, in view of the provisions under clause (c) of sub-section (1) of Section 69, read with clause (d) W.P.(C) .No.1465 of 2018 13 of sub-section (2) of Section 69. In the result, this writ petition is disposed of by holding that, in the absence of an appellate authority competent to entertain an appeal under sub-rule (4) of Rule 198, the petitioner can challenge Ext.P6 order of dismissal by approaching the Co-operative Arbitration Court having jurisdiction, by invoking Section 69 of the Act, in view of the provisions under clause (c) of sub-section (1) of Section 69, read with clause (d) of sub-section (2) of Section 69. **Sd/ANIL K.NARENDRAN JUDGE** SB/03/07/2018