I D Kotwal (Since Deceased) vs Amanath Co-Operative Bank Ltd
2022 Latest Caselaw 724 Kant

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        IN THE HIGH COURT OF KARNATAKA
                DHARWAD BENCH

     DATED THIS THE 17th DAY OF JANUARY, 2022

                        BEFORE

       THE HON'BLE MR. JUSTICE R. NATARAJ

       WRIT PETITION NO.6771/2008 (S-DIS)

BETWEEN

1.    I D KOTWAL (SINCE DECEASED)
      REP. BY MRS MUNIRA BEGAUM KOTWAL,
      AGED 45 YEARS, R/O NO.454, RAGHUNATH PETH,
      ANGOL, BELGAUM.

2.    M M ANAGOLKAR S/O MOHAMMED ISHAQ,
      AGED ABOUT 52 YEARS,
      R/O NO.1006/B, KALIGAR GALLI,
      BELGAUM.

3.    H R JAMADAR S/O IBRAHIM SAHEB
      SINCE DECEASED BY HIS LRS

3(a). SHABANA W/O H JAMADAR,
      AGE: 46 YEARS,

3(b). ASIFF S/O H JAMADAR,
      AGE: 22 YEARS,

3(c). GAZALA D/O H JAMADAR,
      AGE: 17 YEARS,

3(d). HAJARA W/O IBRAHIM SAHEB,
      AGE: 77 YEARS,

ALL ARE R/O H.NO.3856/B-2,
KOTWAL GALLI, TQ.-DIST: BELGAUM.
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4.    I I YERAGATTI S/O IBRAHIM SAB,
      AGED ABOUT 56 YEARS,
      R/O NO.2536, KHATAL SHIVALI GALLI,
      BELGAUM.
                                              ...PETITIONERS
(BY SRI.VEERESH R BUDIHAL, ADV.)

AND

1.    AMANATH CO-OPERATIVE BANK LTD.,
      CORPORATE OFFICE, NO.43,
      HOSPITAL ROAD, SHIVAJI NAGAR,
      BANGALORE-560001,
      REP. BY ITS GENERAL MANAGER.

2.    THE DEPUTY REGISTRAR OF CO-OPERATIVE
      SOCIETIES, BELGAUM.

3.    THE ADDITIONAL REGISTRAR OF
      CO-OPERATIVE SOCIETIES,
      ALI ASKAR ROAD, BANGALORE-560 001.
                                          ....RESPONDENTS
(BY SRI.UMESH P HAKKARKI, ADV. FOR
 SRI.MALLIKARJUNSWAMY B HIREMATH, ADV. FOR R1;
 SRI.VINAYAK S KULKARNI, AGA FOR R2 & R3)

      THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF
THE CONSTITUTION OF INDIA PRAYING TO CALL FOR THE RECORDS
PERTAINING TO JUDGMENT DT. 28.6.2007 PASSED IN APPEAL
NOS.1220 AND 1278 TO 1280/2003 ON THE FILE OF THE KARNATAKA
APPELLATE TRIBUNAL, BANGALORE AND PERUSE THE SAME; QUASH
THE JUDGMENT DT. 28.6.2007 PASSED IN APPEAL NOS. 1220 AND
1278 TO 1280/2003 ON THE FILE OF THE KARNATAKA APPELLATE
TRIBUNAL, BANGALORE ANNEXURE X. AS A CONSEQUENCE OF
QUASHING THE JUDGEMENT OF THE TRIBUNAL, DIRECT THE R1-BANK
TO REINSTATE THE PETITIONERS INTO SERVICE WITH ALL SERVICE
BENEFITS INCLUSIVE OF MONETARY BENEFITS AS DIRECTED BY THE
R2 IN ITS JUDGMENT AND AWARD DT.5.7.2003 VIDE ANNEXURE U BY
THE DEPUTY REGISTRAR OF CO-OPERATIVE SOCIETIES, BALGAUM.

     THIS PETITION COMING ON FOR FINAL HEARING, THIS DAY,
THE COURT MADE THE FOLLOWING:
                                  :3:


                               ORDER

The petitioners herein were the employees of Belgaum

Muslim Co-operative Bank Limited, Belgaum (henceforth referred

to as 'Belgaum Bank').

2. A public notice dated 03.11.1991 was caused by the

Chairman of Belgaum Bank indicating therein that the Registrar

of Co-operative Societies had prepared a scheme of

amalgamation of Belgaum Bank with Amanath Co-operative Bank

Limited, Bangalore (henceforth referred to as 'Amanath Bank')

under Section 14-B(1) of the Karnataka Co-operative Societies

Act, 1959 (henceforth referred to as 'the Act, 1959'). The

petitioners and other employees objected to this notification

contending that the entire staff deserves to be absorbed by

Amanath Bank and that they should be given the pay and other

benefits on par with the employees holding similar post in

Amanath Bank. The objections of the petitioners were forwarded

to the Registrar of Co-operative Societies, who after overruling

the objections issued notification dated 21.12.1991 under

Section 14-A and 14-B of the Act, 1959 to amalgamate both

Banks on terms and conditions set out in the Scheme of

Amalgamation. As a result of the amalgamation, Belgaum Bank

was amalgamated with Amanath Bank with effect from

01.01.1992. The petitioners claim that pursuant to condition

Nos.10, 11 and 12 of the Scheme of amalgamation, they

continued in service with Amanath Bank. The Scheme provided

that "Subject to paragraph 11, all the employees of the

transferor bank shall continue in service and be deemed to have

been appointed by the transferee bank on the same

remuneration and on the same terms and conditions of service

as were applicable to such employees."

3. In deference to the Scheme of Amalgamation, the

Registrar of Co-operative Societies by an order dated 28.12.1991

constituted a Screening Committee consisting of five members

including two Joint Registrars of the Department of Co-operation.

The Screening Committee recorded the statement of each of the

staff of Belgaum Bank including the petitioners. While petitioner

No.1 expressed his willingness to resign or seek voluntary

retirement from Belgaum Bank and did not wish to continue in

the service with Amanath Bank, the petitioner Nos.2 to 4

requested the screening committee to recommend their

absorption in Amanath Bank.

4. It is claimed that the screening committee held

proceedings dated 01.12.1994 and recommended absorption of

the services of nine employees of Belgaum Bank and not to

absorb/ continue the services of the petitioners and four others

at Amanath Bank. At a meeting of the Board of the Amanath

Bank held on 01.12.1994, a resolution was passed to absorb nine

employees with effect from 01.01.1992 and not to absorb the

petitioners herein and four other employees. Consequent

thereto, the Amanath Bank issued an order of termination dated

29.12.1994, terminating their services with effect from the said

date and relieving them forthwith on 29.12.1994. The petitioners

assailed this order in a dispute under Section 70 of the Act, 1959

before the Competent Authority. The Competent Authority held

that the resolution of the Amanath Bank not to absorb the

services of the petitioners pursuant to the report of the screening

committee was illegal and consequently set aside the same. The

foremost ground on which the Competent Authority held so, was

that though the screening committee comprised of five

members, yet on the date when its recommendation was

forwarded, one member had expired, while the others did not

attend the meeting and therefore there was no full participation

in the meeting.

5. Being aggrieved by the aforesaid order of the

Competent Authority, the Amanath Bank filed an appeal before

the Karnataka Appellate Tribunal under Section 105 of the Act,

1959. The Tribunal secured the records and found that the

screening committee had conducted an extensive enquiry

regarding the suitability and eligibility of the petitioners for

absorption. The Tribunal also found that there were glaring

irregularities and illegalities that stared in the face of the

petitioners seeking absorption. It also found that though the

screening committee was constituted by an order dated

28.12.1991, requiring it to submit its report within sixty days,

the Tribunal found that it was impossible for the committee

constituted by the Registrar on 28.12.1991 to complete its work

within 01.01.1992, which was the appointed date. Having regard

to the above and also having regard to the finding recorded by

the screening committee, the Tribunal held that the petitioners

were not entitled to be absorbed and hence, allowed the appeal

and set aside the order passed by the authority under Section 70

of the Act, 1959.

6. Being aggrieved by the aforesaid order of the

Tribunal, this writ petition is filed.

7. Learned counsel for the petitioners submitted that

the amalgamation contemplated that both the Banks stood

amalgamated with effect from 01.01.1992. He submitted that

the petitioners continued in the employment of the Amanath

Bank even thereafter which was the subject however to

certification by the screening committee. He submitted that if the

petitioners were not suitable or there were any allegations of

misconduct against them, it was incumbent upon Amanath Bank

to conduct an enquiry before condemning them unheard.

8. He also submitted that the scheme of amalgamation

provided for absorption of the services of the staff of Belgaum

Bank and therefore, if the petitioners were to be terminated on

the ground of the alleged misappropriation or any misfeasance,

the petitioners had to be heard.

9. Per contra, the learned counsel for respondent No.1-

Amanath Bank submits that the petitioners did appear before the

screening committee and they admitted the finding recorded by

the Amanath Bank during moratorium period and therefore, he

submitted that there was nothing amiss about the screening

committee recording the finding against the petitioners. Insofar

as the allegation that though the screening committee comprised

of five members, only three members had participated in the

meeting and recommended the case of the petitioners, the

learned counsel contended that the screening committee did

record the evidence of the petitioners and found that the

petitioners were ineligible to be absorbed. He submitted that the

screening committee at that point in time was comprised of

members, who belonged to the Department of Co-operation and

therefore, they had formalized their recommendation. He

submitted that this act on the part of the screening committee

cannot be found fault with. He therefore submitted that the

petitioners do not deserve any leniency as they were unfit for

absorption.

10. I have considered the submissions made by the

learned counsel for the parties.

11. Though the petitioners had objected to the scheme of

amalgamation, yet, none of them followed it through by

challenging the scheme of amalgamation or challenged the

process of absorption of the staff of the erstwhile Belgaum Bank

by the Amanath Bank. Therefore, it has to be construed that all

the petitioners had accepted to go through the process of

screening by the committee. They had tacitly accepted to subject

themselves for an enquiry at the hands of the screening

committee. The evidence on record in the form of statement of

the petitioners before the screening committee, clearly indicates

that the petitioners themselves admitted of wrong doing. They

did not challenge the imputation made against them, on the

contrary, voluntarily accepted their involvement in certain

illegalities. If the screening committee which was constituted for

the purpose of identifying suitable eligible candidates had

recorded the statement of the petitioners and if after such

recording, if one of the members of the committee had expired,

still there was requisite quorum of the screening committee,

which could consider the suitability and eligibility of the

petitioners.

12. If the committee constituted by the Registrar of Co-

operative Societies found them unfit to be absorbed in Amanath

Bank, the respondent No.1 cannot be accused of any misgiving.

Since the scheme of absorption was based on the subjective

satisfaction of the screening committee, the petitioners, who are

found unfit, cannot claim any right to be absorbed.

13. In that view of the matter, there is no merit in this

writ petition and the same is dismissed.

14. The petitioners are entitled to file appropriate

representation before the concerned authority claiming the

terminal benefits, if any, payable by Amanath Bank. If such a

representation is filed, the same shall be considered in

accordance with law and appropriate orders would be passed

within a period of six months from the date of receipt of such a

representation.

Sd/-

JUDGE KGK