Jose M Joseph vs Idukki District Co-Operative ...
2021 Latest Caselaw 14616 Ker

          IN THE HIGH COURT OF KERALA AT ERNAKULAM
                             PRESENT
              THE HONOURABLE MR. JUSTICE AMIT RAWAL
   FRIDAY, THE 2ND DAY OF JULY 2021 / 11TH ASHADHA, 1943
                     WP(C) NO. 14970 OF 2020
PETITIONER:

         Mr.JOSE M JOSEPH,
         AGED 59 YEARS,
         MAHAKKATTU HOUSE,NEDUMKANDAM.P.O,
         IDUKKI DISTRICT.

         BY ADVS.
         MADHU RADHAKRISHNAN
         SRI.NELSON JOSEPH
         SRI.M.D.JOSEPH


RESPONDENTS:

    1    IDUKKI DISTRICT CO-OPERATIVE BANK LTD.,
         NOW CALLED THE KERALA STATE CO-OPERATIVE BANK
         PB NO.6515, CO-BANK TOWERS,
         PALAYAM,THIRUVANANTHAPURAM-695033,
         REPRESENTED BY ITS CHIEF EXECUTIVE OFFICER.

    2    BRANCH MANAGER,
         VANDANMEDU BRANCH OF IDUKKI DISTRICT
         CO-OPERATIVE BANK
         NOW CALLED THE KERALA STATE CO-OPERATIVE BANK,
         VANDANMEDU,IDUKKI,PIN-685515.

    3    KERALA STATE CO-OPERATIVE EMPLOYEES PENSION
         BOARD,
         CO-BANK TOWERS,
         THIRUVANANTHAPURAM-695033,
         REPRESENTED BY ITS CHAIRMAN.

    4    KERALA STATE CO-OPERATIVE EMPLOYEES FUND BOARD,
         3RD FLOOR, KERALA STATE CO-OPERATIVE BANK
         BUILDING,THIRUVANANTHAPURAM-695001,
         REPRESENTED BY ITS SECRETARY.
 W.P.(C).No.14970/20
                                2




             BY ADVS.
             SRI.GILBERT GEORGE CORREYA, SC, KERALA STATE CO-
             OPERATIVE BANK LTD.
             SRI.M.SASINDRAN


    THIS WRIT PETITION (CIVIL) HAVING COME UP FOR
ADMISSION ON 02.07.2021, THE COURT ON 14.07.2021
DELIVERED THE FOLLOWING:
 W.P.(C).No.14970/20
                               3




                            JUDGMENT

Question of law to be decided in the present writ

petition is as to whether a disciplinary enquiry can be

initiated against the retired employee of the Co-operative

Societies in the absence of service of memo of charge

except show cause notice Ext.P10 which is under challenge.

2. To answer the question, the facts in brief are:

petitioner joined the service with the 1 st respondent -Idukki

District Co-operative Bank- through Public Service

Commission on 03.12.2001 and confirmed on 03.12.2002.

From time to time he was promoted and had also received

Certificate of Performance dated 16.04.2012 Ext.P9. While

working as a Branch Manager, on 20.09.2018, he was

transferred to the Head Office and at the relevant point of

time all the documents were handed over to the Branch

Accountant. To the utter surprise of the petitioner, before

he would retire on 31.10.2018, was served with the W.P.(C).No.14970/20

impugned suspension order dated 26.10.2018 Ext.P10.

3. Learned counsel appearing on behalf of the

petitioner submitted that even after two years of his

retirement petitioner was not served with the memo of

charge and thus the provisions of Rule 198(7) of Kerala Co-

operative Societies Rules, which is applicable to the

employees of Co-operative Societies, would not come into

play as it is only in those circumstances where memo of

charge, if had been served upon the petitioner in service,

would there be continuation of disciplinary proceedings.

4. In support of the aforementioned contention,

reliance has been laid to the following judgments:

Satheesan Vs. Kannur District Co-operative Bank

(2020 (4) KLT 236), Chairman-Cum-Managing

Director, Coal India Ltd. and Others. Vs. Ananta Saha

and Others (2011) 5 SCC (LS) 750), Dev Prakash

Tewari Vs. U.P. Co-operative Institutional Service W.P.(C).No.14970/20

Board (2014) 7 SCC 260). In all the aforementioned

judgments it has been consistently held that in the absence

of any rules Department cannot take the aid of Explanation

(a) to Rule 3 of Part III of the Kerala Service Rules. It only

applies to State employees and not to the Co-operative

employees. Only rules relating to leave as prescribed under

the Kerala Service Rules, as per the provisions of Rule

190(8) of Co-operative Societies Rules, is made applicable

and no other provisions. In such circumstances

respondents are not permitted to withhold the retirement

benefits in the absence of initiation of any proceedings prior

to the retirement of the petitioner. It is settled law that if

initial action is not in consonance with law, subsequent

proceedings would not ratify .

5. On the other hand, learned counsel appearing on

behalf of the respondents submitted that petitioner had

committed certain irregularities while processing the loan W.P.(C).No.14970/20

without proper documentation and necessary evaluation

resulting into increased liability of the Bank and detailed

enquiry before, show cause notice was conducted and found

that substantial amount was outstanding. Petitioner did not

respond to the show cause notice and the proceedings in

this regard are in progress. In fact the Bank had taken all

the measures to quantify the liability of the petitioner

which has been quantified in terms of money. In support of

the contention relied upon the unreported judgment of this

Court in S.Yadava Vs. Kerala State Co-operative Bank

and Others rendered in W.P.(C) No.23480 of 2020, wherein

this Court by referring to the provisions of definition of

"dispute" as defined in Section 2(i) of the Kerala Co-

operative Societies Act (hereinafter referred to as "the Act",

for short) and Section 69(1)(h) held that once the charge

sheet was served during the period of service of the

employee disciplinary proceedings can be initiated if at all W.P.(C).No.14970/20

the employee had retired, Society is not prevented to

initiate the proceedings under Section 69 of Act. The

judgment has been assailed in the writ appeal but there is

no interim stay and urges this Court for dismissal of the writ

petition.

6. I have heard counsel for the parties and appraised

the paper books.

7. The factum of the retirement of the petitioner on

31.08.2018 and service of show cause notice dated

26.10.2018 in the absence of any charge memo are not in

dispute. The contents of the show cause notice reads as

under:

"As per reference No.(1) a report pertaining to the anomalies that you had carried out regarding Loan distribution while holding the position of branch Manager, Vandanmedu has been received. Apart from that, the Regional Manager reported that there occurred some serious defaults on your part while performing your entrusted works. In the above circumstances, it is W.P.(C).No.14970/20

informed that you are suspended from the service pending investigation.

Your retirement benefits will be on hold until you have compensated the economic loss to the bank due to your above anomalies."

It is also matter of the fact that till date i.e., after two years

of retirement of the petitioner no charge memo has been

served. Rule 198(7) of Kerala Co-operative Rules reads as

under:

7. Section 198 of the Act is extracted hereunder:

"198.Disciplinary Action:- (1) Any member of the establishment of a Co-operative Society may for good and sufficient reasons, be punished by imposing any of the following penalties, namely:-

             (a)    Censure;
             (b)    Fine (in the case of employees in the last
             grade);
             (c)    Withholding of increments with or without
             cumulative effect
             (d)    Withholding of promotion;
             (e)    Recovery from pay of the whole or part of any

pecuniary loss caused to the society, by negligence or breach of orders or otherwise;

             (f)    Reduction to a lower rank;
             (g)    Compulsory retirement;
             (h)    Dismissal from service.
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(1.7)In the event of any pendency of disciplinary proceedings W.P.(C).No.14970/20

against any employee of a co-operative society or any co-

operative institution pursuant to any charge of grave

misconduct, irregularity, corruption or other charge involving

moral turpitude, no retirement benefits shall be sanctioned to

such employee or retired employee and in case of sanctioning

of any retirement benefits to any such employee or retired

employee, the name and designation of the sanctioning

authority together with the reason for such sanctioning shall

be recorded by the sanctioning authority by himself and such

authority shall be held responsible for any loss to the society

owing to such sanctioning of retirement benefits if found that

such sanctioning was unwarranted."

On perusal of the provisions extracted above, it is evident

that enquiry can also continue against the retired employee

for recovery from the pay of whole or part of any pecuniary

loss caused to the Society by negligence or breach of orders

or otherwise. But the fact of the matter is that the

respondents had not served any memo of charges, thus it

would not have deeming fiction of pendency of disciplinary W.P.(C).No.14970/20

proceedings as service of memo of charges would relate

back to initiation of disciplinary proceedings. In the

absence any memo of charges the show cause notice is

without jurisdiction. Any objection with regard to the

maintainability of the writ petition raised at this point of

time cannot be also ground for, it is settled law that writ

jurisdiction under Article 226 of the Constitutional of India

despite efficacious remedy can always be invoked if prima

facie it is found that the order is without jurisdiction and

arbitrary in nature.

In view of what has been observed above, without

issuance of charge memo, issuance of show cause notice

was without jurisdiction. I am in concurrence with the

judgments cited in support of the petitioner wherein it has

been categorically held that in the absence of any

provisions of Rules, which have not been contradicted, the

retirement benefits of the employee in the absence of W.P.(C).No.14970/20

pendency of disciplinary proceedings cannot be withheld.

This Court in the unreported judgment though

negated the argument of the learned counsel representing

the respondents regarding the applicability of the Kerala

Service Rules as there is no such provisions or notification

adopting the aforementioned provision except to the leave

as per Rule 198 of the Kerala Co-operative Societies Rules.

Thus I am of the view that show cause notice Ext.P10 issued

was without jurisdiction is not sustainable in law, is thereby

quashed. Writ petition stands allowed. Respondents are

directed to release the terminal benefits of the petitioner in

accordance with law, as early as possible, within a period of

two months from the date of receipt of a certified copy of

the judgment.

Sd/-

AMIT RAWAL JUDGE VV W.P.(C).No.14970/20

APPENDIX OF WP(C) 14970/2020

PETITIONER EXHIBITS

EXHIBIT P1 TRUE COPY OF THE EMPLOYMENT ADVICE LETTER DATED 31-10-2001 BY THE KERALA STATE PUBLIC SERVICE COMMISSION

EXHIBIT P2 TRUE COPY OF THE CONFIRMATION PROCEEDINGS DATED 1-1-2003 BY THE 1ST RESPONDENT

EXHIBIT P3 TRUE COPY OF THE SERVICE ORDER SO NO.260/06-07 DATED 2-5-2006

EXHIBIT P4 TRUE COPY OF THE SERVICE ORDER SO NO.49/09-10 DATED 28-7-2009

EXHIBIT P5 TRUE COPY OF THE SERVICE ORDER SO NO.10/10-11 DATED 8-6-2010

EXHIBIT P6 TRUE COPY OF THE SERVICE ORDER SO NO.49/10-11 DATED 10-12-2010

EXHIBIT P7 TRUE COPY OF THE SERVICE ORDER SO NO.44/12-13 DATED 11-12-2012

EXHIBIT P8 CERTIFICATE OF TRAINING TO THE PETITIONER DATED 24-7-2004

EXHIBIT P9 TRUE COPY OF CERTIFICATE OF PERFORMANCE DATED 16-4-2012

EXHIBIT P10 TRUE COPY OF ORDER DATED 26-10-2018 BY 1ST RESPONDENT W.P.(C).No.14970/20

EXHIBIT P11 TRUE COPY OF THE RELEVANT PAGES FROM REVISED SERVICE REGULATION OF THE 1ST RESPONDENT.