The Kerala State Co-Operative ... vs Syamala.K.S
2022 Latest Caselaw 6724 Ker

               IN THE HIGH COURT OF KERALA AT ERNAKULAM
                                PRESENT
          THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN
     TUESDAY, THE 14TH DAY OF JUNE 2022 / 24TH JYAISHTA, 1944
                        WP(C) NO. 4457 OF 2020
PETITIONER:

          THE KERALA STATE CO-OPERATIVE BANK LTD.
          KOTTAYAM, (THE ERSTWHILE KOTTAYAM DISTRICT CO-OPERATIVE
          BANK LTD), REPRESENTED BY ITS GENERAL MANAGER,
          KOTTAYAM-686001.

          BY ADVS.
          T.A.SHAJI (SR.)
          SRI.S.ABHILASH VISHNU
          SRI.ATHUL SHAJI
          SHRI.NIKHIL SUNNY MOOKEN



RESPONDENTS:

    1     SYAMALA.K.S., KOTTACHIRAYIL HOUSE, MEVADA P.O, PALA,
          KOTTAYAM DISTRICT, PIN-686573.

    2     JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES(GENERAL)
          KOTTAYAM, PIN-686001.

    3     KERALA STATE CO-OPERATIVE EMPLOYEES PENSION BOARD
          REPRESENTED BY ITS SECRETARY, P B NO. 85, KERALA NIVAS,
          T.C. 27/156, 157, CHINMAYA LANE, KUNNUMPURAM, NEAR
          AYURVEDA COLLEGE, THIRUVANANTHAPURAM-695001.

          BY ADVS.
          SRI.P.N.MOHANAN, SC
          SRI.M.SASINDRAN, SC
          SRI.C.P.SABARI
          SMT.AMRUTHA SURESH
          SRI.H.MAHADEVAN



     THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
14.06.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
 WP(C) NO. 4457 OF 2020
                                     2


                                  JUDGMENT

The petitioner impugns Ext.P8 order of the Kerala Co-

operative Tribunal, Thiruvananthapuram (for short, 'the

Tribunal'), in which the claim of the first respondent herein -

who was their erstwhile employee, for pensionary benefits,

consequent to her retirement, has been directed to be

acceded to by them.

2. Sri.Athul Shaji, learned standing counsel for the

petitioner, submitted that Ext.P8, to the extent to which it

directs his client to disburse the pensionary benefits to the

first respondent, is illegal and unlawful because: for the first,

the Tribunal did not obtain any jurisdiction to issue such an

order; and, for the second, since the petitioner is still

subjected to a disciplinary action, which is still pending. He

argued that, therefore, as per Rule 198(7) of the Co-

operative Societies Rules ('KCS Rules' for short), the first

respondent cannot seek her retiral benefits to be disbursed

until the disciplinary enquiry against her is completed.

3. Sri.Athul Shaji, thereafter, explained that the

disciplinary enquiry against the first respondent was, in fact,

completed in the year 2013, consequent to which, she filed WP(C) NO. 4457 OF 2020

an appeal before the Statutory Appellate Authority - the

Managing Committee of the Bank - which ended in Ext.P8

order confirming the order of punishment, imposing a

penalty of recovery of loss caused to the Bank from her. He

argued that, therefore, until such recovery is effected, the

Tribunal could not have directed her pensionary benefits to

be released; and then added vehemently that the said order

is without competence because the proceedings before the

Tribunal arose from a non-maintainable appeal against

Ext.P7 order of the Co-operative Arbitration Court, in a suit

filed by the first respondent against the disciplinary action

and punishment imposed against her. The learned counsel,

therefore, prayed that this writ petition be allowed.

4. In response, Sri.C.P.Sabari - learned counsel for the

first respondent, submitted that, even going by Exts.P5 and

P6 orders of disciplinary enquiry against his client, the

punishment imposed is as per Rule 198(1)(e) of the Kerala

Co-operative Societies Rules (KCS Rules), which only allows

recovery from pay, of the whole or part of any pecuniary loss

caused to the society. He argued that this will not permit

recovery from pension or other retiral benefits and that this WP(C) NO. 4457 OF 2020

is more so, because his client has now retired from service.

He then added that the alleged pecuniary loss to the Bank

has not been yet quantified and that if any proceedings for

the same had been initiated by them, she would have been

able to convince its appropriate Authority that she was not

responsible for such - even if assuming that any such loss

had been occasioned - because she was only the sanctioning

Authority of the loans in question and nothing else. He then

further submitted that the Bank appears to be making an

allegation that there is a loss of Rs.62 lakhs, but that, as has

been correctly referred in Ext.P8, this has not been

quantified, nor as the Bank been able to explain how they say

so, when every loan was supported by collateral and

sufficient other security. Sri.C.P.Sabari, therefore, prayed

that this writ petition be dismissed.

5. Sri.Sreehari I., learned counsel appearing for the

standing counsel for the Employees' Pension Board,

submitted that they have not yet obtained the pension docket

with regard to the first respondent from the petitioner -

Bank; nor have they paid the eligible contribution. He

submitted that as soon as this is done, necessary steps will WP(C) NO. 4457 OF 2020

be taken to disburse the eligible pension to the first

respondent.

6. As I have said above, the specific stand of the

petitioner - Bank is that the disciplinary enquiry against the

first respondent is still pending and therefore, that the

Arbitration Court could not have issued Ext.P7, asking them

to disburse the eligible pensionary benefits to her.

7. The afore argument has an inherent problem

embedded to it because, the Bank admits unequivocally that

they have not yet quantified the liability against the first

respondent and that the punishment imposed against her is

only under Section 198(1)(e) of the KCS Rules. This

punishment postulates the recovery from the pay of an

employee, but is conspicuously silent as to such action being

issued against the retiral benefits. Therefore, the Bank can

only act under the provisions of Section 198(8) of the KCS

Rules, through which, a Non-liability Certificate will require

to be obtained by the first respondent before her pensionary

benefits can be claimed. Normally, if the Bank had

approached a competent Authority under Section 69 of the

Kerala Co-operative Societies Act (for short 'KCS Act') and WP(C) NO. 4457 OF 2020

had obtained an Award, then they could have withheld the

Non-Liability Certificate, or issued one, accounting for the

said liability or loss, had it been legally quantified.

8. In the case at hand, the Bank has not, concededly,

approached any Authority under Section 69 of the KCS Act,

but they still maintain that there is a loss caused to them, on

account of omissions from the part of the first respondent.

This is egregiously improper because Ext.P6 final order was

issued as early as in the year 2014; and for the last eight

years, they have chosen not to approach any Authority for

quantification of the alleged loss, saying that the first

respondent had, in the meanwhile, approached the

Arbitration Court and the Tribunal against the attempt to

recover amounts from her pensionary benefits. The first

respondent was certainly at liberty to have invoked any

remedy that may be available to her in law, but I do not

understand how this could have been cited by the petitioner -

Bank to say that they had not initiated any action for

quantification of the alleged liability.

9. This is crucial because, had the Bank initiated any

action for qualification, it would have been available for the WP(C) NO. 4457 OF 2020

first respondent to establish that she was not responsible for

it, even assuming that loss had been caused to them; and

therefore any continued inaction on the part of the Bank in

such direction and to then rely upon the same to deny

payment of the pensionary benefits, is an affront to the KCS

Act and Rules, in particular Rule 198(8) of the latter.

10. In the afore circumstances, I do not understand why

the petitioner Bank challenges Ext.P8; but since I notice that

it is only because Arbitration Tribunal has directed them to

pay the pensionary benefits, I deem it appropriate to read it

down in the manner that I proposed hereunder.

11. Resultantly, I order this writ petition, clarifying that,

notwithstanding Ext.P8 order of the Arbitration Tribunal,

the petitioner Bank will be at liberty to initiate any action as

may be available to them in law, subject to the laws of

Limitation, to seek quantification of the alleged liability

against the first respondent.

However, whether they do so or otherwise, the entire

pensionary benefits due to the petitioner shall be disbursed

by the Bank within a period of four months from the date of

receipt of a copy of this judgment and they are at liberty to WP(C) NO. 4457 OF 2020

try and obtain interdictory orders from the competent

Authority in the meanwhile; in which event, the afore

direction will stand deferred, until such time as such orders

operate.

Sd/- DEVAN RAMACHANDRAN JUDGE stu WP(C) NO. 4457 OF 2020

APPENDIX OF WP(C) 4457/2020

PETITIONER EXHIBITS

EXHIBIT P1 TRUE COPY OF SUSPENSION ORDER ISSUED BY THE PART TIME ADMINISTRATOR TO THE 1ST RESPONDENT DATED 19.09.2012.

EXHIBIT P2 TRUE COPY OF CHARGE MEMO ISSUED BY GENERAL MANAGER OF THE PETITIONER BANK TO THE 1ST RESPONDENT DATED 19.10.2012.

EXHIBIT P3 TRUE COPY OF THE ENQUIRY REPORT SUBMITTED BY THE ENQUIRY OFFICER TO THE PETITIONER BANK DATED 02.12.2013.

EXHIBIT P4 TRUE COPY OF LETTER SENT BY THE 1ST RESPONDENT TO THE DISCIPLINARY SUB COMMITTEE DATED 30.04.2014.

EXHIBIT P5 TRUE COPY OF THE ORDER ISSUED BY THE CHAIRMAN OF DISCIPLINARY SUB COMMITTEE DATED 19.07.2014.

EXHIBIT P6 TRUE COPY OF ORDER ISSUED BY THE BOARD OF DIRECTORS ON THE APPEAL FILED BY THE 1ST RESPONDENT HEREIN DATED 20.12.2014.

EXHIBIT P7 TRUE COPY OF THE AWARD PASSED BY THE CO-

OPERATIVE ARBITRATION COURT, THIRUVANANTHAPURAM DATED 10.10.2018.

EXHIBIT P8 TRUE COPY OF JUDGMENT OF KERALA CO-

OPERATIVE TRIBUNAL DATED 22.11.2019.