Madhya Pradesh High Court
Bhagwati Prasad Parashar vs District Central Cooperative Bank Ltd. on 19 August, 2025
NEUTRAL CITATION NO. 2025:MPHC-GWL:17943 1
IN THE HIGH COURT OF MADHYA PRADESH
AT GWALIOR
BEFORE
HON'BLE SHRI JUSTICE ASHISH SHROTI
WRIT PETITION No. 15390 of 2022
JITENDRA SINGH GURJAR
Versus
DISTRICT CENTRAL COOPERATIVE BANK LTD. & ANOTHER
----------------------------------------------------------------------------------------------------------
Appearance:
Shri Alok Kumar Sharma - Advocate for the petitioner.
Shri R.B.S. Tomar - Advocate for the respondents.
----------------------------------------------------------------------------------------------------------
WITH
RIT PETITION No. 15391 of 2022
MAHENDRA SINGH BHADORIA
Versus
DISTRICT CENTRAL COOPERATIVE BANK LTD. & ANOTHER
----------------------------------------------------------------------------------------------------------
Appearance:
Shri Alok Kumar Sharma - Advocate for the petitioner.
Shri R.B.S. Tomar - Advocate for the respondents.
------------------------------------------------------------------------------------------
WRIT PETITION No. 15392 of 2022
ARVIND SINGH TOMAR
Versus
DISTRICT CENTRAL COOPERATIVE BANK LTD. & ANOTHER
----------------------------------------------------------------------------------------------------------
Appearance:
Shri Alok Kumar Sharma - Advocate for the petitioner.
Shri R.B.S. Tomar - Advocate for the respondents.
------------------------------------------------------------------------------------------
Signature Not Verified
Signed by: VIPIN KUMAR
AGRAHARI
Signing time: 8/19/2025
5:16:40 PM
NEUTRAL CITATION NO. 2025:MPHC-GWL:17943 2
WRIT PETITION No. 15421 of 2022
JUGAL KISHORE PATHAK
Versus
DISTRICT CENTRAL COOPERATIVE BANK LTD. & ANOTHER
----------------------------------------------------------------------------------------------------------
Appearance:
Shri Ankur Maheshwari - Advocate for the petitioner.
Shri R.B.S. Tomar - Advocate for the respondents.
------------------------------------------------------------------------------------------
WRIT PETITION No. 15429 of 2022
BHAGWATI PRASAD PARASHAR
Versus
DISTRICT CENTRAL COOPERATIVE BANK LTD & ANOTHER
----------------------------------------------------------------------------------------------------------
Appearance:
Shri Alok Kumar Sharma - Advocate for the petitioner.
Shri R.B.S. Tomar - Advocate for the respondents.
------------------------------------------------------------------------------------------
WRIT PETITION No. 15604 of 2022
PREM DUTT SHARMA
Versus
DISTRICT CENTRAL COOPERATIVE BANK LTD & ANOTHER
----------------------------------------------------------------------------------------------------------
Appearance:
Shri Alok Kumar Sharma - Advocate for the petitioner.
Shri R.B.S. Tomar - Advocate for the respondents.
------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
Whether approved for reporting: Yes/No.
Reserved for order on: 30/07/2025
--------------------------------------------------------------------------------------------------------
ORDER
(Passed on 19/08/2025)
The petitioners in this batch of writ petitions are aggrieved by the
order passed by the Chief Executive Officer of respondent-Bank whereby
they have been directed to be compulsorily retired from service in public
interest. Since, the issue involved in all these petitions is common, the
same are being decided by this common order.
[2]. The petitioners have invoked Article 226 of Constitution of India,
being aggrieved by the order, dated 24.06.2022, passed by respondent
no.2-Chief Executive Officer, District Cooperative Central Bank Mydt.,
Gwalior, (hereinafter referred to as "Bank") whereby they have been
retired compulsorily in public interest exercising power under Rule 71.2 of
Service Rules. The petitioners have also prayed for a direction to the
respondents to reinstate them in service with full arrears of salary and
interest.
[3]. The facts necessary of decision of this case are that:
i. The petitioner, Jitendra Singh Gurjar in W.P. No.15390/22, was
initially appointed as Clerk in the Bank on 07.07.1990 (Annexure P/3) and
was subsequently promoted to the post of Assistant Accountant vide order,
dated 05.09.1998, (Annexure P/4). At the time when the impugned action
is taken by the respondents, the petitioner was working as In-charge
Branch Manager at Cheenor Branch of the Bank;
ii. The petitioner, Bhagwati Prasad Parashar in W.P. No.15429/22,
was initially appointed as Clerk in the Bank on 22.01.2001 (Annexure
P/3). At the time when the impugned action is taken by the respondents, he
was working as In-charge Branch Manager at Antari Branch of the Bank;
iii. The petitioner, Prem Dutt Sharma in W.P. No.15604/22, was
initially appointed as Clerk in the Bank on 31.12.1988 (Annexure P/3) and
was subsequently promoted to the post of Assistant Accountant vide order,
dated 05.09.1998, (Annexure P/4). At the time when the impugned action
is taken by the respondents, the petitioner was working as In-charge
Branch Manager at Dabra Branch of the Bank;
iv. The petitioner, Mahendra Singh Bhadoira in W.P. No.15391/22,
was initially appointed as Clerk in the Bank on 01.07.1991 (Annexure
P/3) and was subsequently promoted to the post of Assistant Accountant
vide order, dated 05.09.1998, (Annexure P/4). At the time when the
impugned action is taken by the respondents, the petitioner was working
as In-charge Branch Manager at Ghatigaon Branch of the Bank;
v. The petitioner, Arvind Singh Tomar in W.P. No.15392/22, was
initially appointed as Clerk in the Bank on 22.04.1995 (Annexure P/3). At
the time when the impugned action is taken by the respondents, the
petitioner was working as In-charge Branch Manager at Murar Branch of
the Bank.
vi. The petitioner, Jugal Kishore Pathak in W.P. No.15421/22, was
initially appointed as Clerk in the Bank on 07.07.1990 (Annexure P/3) and
was subsequently promoted to the post of Assistant Accountant vide order,
dated 05.09.1998, (Annexure P/4). At the time when the impugned action
is taken by the respondents, the petitioner was working as In-charge
Branch Manager at Cheenor Branch of the Bank.
[4]. The matter of continuance of petitioners in service, on completion
of 50 years of age or 20 years of service, was placed before the Staff Sub-
Committee in its meeting held on 17.06.2022 (Annexure R/1). The
petitioners were given opportunity of personal hearing by the Committee.
The Committee was of the view that the petitioners have failed to achieve
desired targets in the matter of recovery of loan dues, deposits and also in
the matter of disbursement of loan in last five years. It was opined that the
petitioners have failed to perform their duty efficiently and because of
their lethargic performance, the Bank is put to business losses. After
having examined the petitioners' service record, the Committee opined
that they are not able to perform their duty efficiently and are, therefore,
liable to be compulsorily retired from service under Rule 71.2 of Service
Rules. Accordingly, the respondent no.2 passed separate impugned orders
on 24.06.2022 whereby the petitioners are retired compulsorily from
service in public interest.
[5]. The learned counsel for petitioners, challenging the impugned order,
submitted that before passing of impugned order, the petitioners were
served with a show cause, dated 08.12.2021, to which they submitted
reply. However, instead of conducting enquiry into the allegations made in
the show cause notice, the respondents adopted a shortcut method and
removed the petitioners from service by exercising powers under Rule
71.2 of Bank's Service Rules. It is his submission that since in the show
cause notice, punishment of compulsory retirement was proposed, the
impugned order could not be passed without conducting enquiry. He
submitted that the impugned orders are stigmatic and should have been
preceded by a departmental enquiry.
[6]. The learned counsel further submitted that for compulsorily retiring
an employee, the respondents are required to examine petitioners' entire
service record including his ACRs whereas the Staff Sub-Committee
considered petitioners' record only for the limited period during which
they remained posted as In-charge Branch Manager. He submitted that the
Staff Sub-Committee failed to examine their entire service record.
Referring to copy of ACRs filed on record, learned counsel submitted that
the petitioners' ACRs were all good and they cannot be said to be a
deadwood. It is his further submission that the respondents failed to
consider the reply to show cause notice given by the petitioners. He also
submitted that the impugned orders does not assign any reason for
compulsorily retiring the petitioners which is in violation of principles of
natural justice.
[7]. The learned counsel for the petitioners also submitted that there
were three members in Staff Sub-Committee, however, its minutes has
been signed by only two members and, therefore, the recommendations
made by Committee are vitiated. He, therefore, prayed for indulgence by
this Court.
[8]. On the other hand, the learned counsel for respondents supported
the impugned orders and submitted that the petitioners failed to show any
improvement in their working for last at least five years and the Bank was
made to suffer losses due to their lethargic performance. He submitted that
the petitioners failed to perform so as to establish their utility for the Bank.
The learned counsel submitted that a decision of compulsory retirement of
an employee can be challenged only on the ground of mala-fide or when
the decision taken is so absurd that a prudent man cannot reach to such
conclusion. The sufficiency of material is not a ground to interfere in the
matter and it is the subjective satisfaction of employer to retire an
employee compulsorily. The learned counsel also submitted that the
minutes of meeting of Staff Sub-Committee has been signed by two
members which constitutes majority and, therefore, non-signing of the
same by one member is of no consequence. He further submitted that the
CEO of the Bank is the petitioners' appointing authority and was,
therefore, competent to pass the impugned order. He also submitted that
the petitioners were already nearing their normal age of retirement i.e. 60
years and, therefore, no prejudice is caused to them because of premature
retirement. They have been paid all their retiral dues. The learned counsel
for respondents, therefore, prayed for dismissal of the petitions.
[9]. Considered the arguments and perused the records.
[10]. Before adverting to the merits of the case, it is profitable to discuss
the law with regard to scope of interference by this Court in the matter of
compulsory retirement. More than four decades ago, the issue was
considered by Apex Court in the case of Union of India Vs. M.E. Reddy
reported in (1980)2 SCC 15 wherein the nature of order of compulsory
retirement of an employee is explained by Apex Court as under:
"12. An order of compulsory retirement on one hand causes no
prejudice to the government servant who is made to lead a
restful life enjoying full pensionary and other benefits and on
the other gives a new animation and equanimity to the
Services. The employees should try to understand the true
spirit behind the rule which is not to penalise them but
amounts just to a fruitful incident of the Service made in the
larger interest of the country. Even if the employee feels that
he has suffered, he should derive sufficient solace and
consolation from the fact that this is his small contribution to
his country, for every good cause claims its martyr."
[11]. Again, in the case of Baikuntha Nath Das Vs. District Medical
Officer reported in (1992)2 SCC 299, the Apex Court laid down following
parameters to be followed in the matter of considering cases of
compulsory retirement:
"34. The following principles emerge from the above
discussion:
(i) An order of compulsory retirement is not a punishment. It
implies no stigma nor any suggestion of misbehaviour.
(ii) The order has to be passed by the government on forming
the opinion that it is in the public interest to retire a
government servant compulsorily. The order is passed on the
subjective satisfaction of the government.
(iii) Principles of natural justice have no place in the context of
an order of compulsory retirement. This does not mean that
judicial scrutiny is excluded altogether. While the High Court
or this Court would not examine the matter as an appellate
court, they may interfere if they are satisfied that the order is
passed (a) mala fide or (b) that it is based on no evidence or
(c) that it is arbitrary -- in the sense that no reasonable person
would form the requisite opinion on the given material; in
short, if it is found to be a perverse order.
(iv) The government (or the Review Committee, as the case
may be) shall have to consider the entire record of service
before taking a decision in the matter -- of course attaching
more importance to record of and performance during the later
years. The record to be so considered would naturally include
the entries in the confidential records/character rolls, both
favourable and adverse. If a government servant is promoted
to a higher post notwithstanding the adverse remarks, such
remarks lose their sting, more so, if the promotion is based
upon merit (selection) and not upon seniority.
(v)An order of compulsory retirement is not liable to be
quashed by a Court merely on the showing that while passing
it uncommunicated adverse remarks were also taken into
consideration. That circumstance by itself cannot be a basis for
interference.
Interference is permissible only on the grounds mentioned in
(iii) above. This aspect has been discussed in paras 30 to 32
above."
[12]. It is thus evident that an order of compulsory retirement causes no
prejudice to the employee and rather he is made to lead a restful life
enjoying full retiral benefits. On the other hand, it gives a room to new and
energetic and more efficient employee to serve the department better. The
order of compulsory retirement is not passed in order to penalize the
employee but, as observed by Apex Court, it amounts just to a fruitful
incident of the Service made in the larger interest of the country. It is also
evident that retiring an employee compulsorily is the decision of employer
based upon its subjective satisfaction and interference in such matters can
be made only when the decision is actuated with any mala-fide or it is
based on no evidence or it is so arbitrary that no reasonable person would
form the requisite opinion on the given material.
[13]. The petitioners' service conditions are governed by "Jila Sahakari
Kendriya Bank Maryadit Ke Sevayukton Ke (Niyojan, Nibandhan Tatha
Karyastithi) Seva Niyam" (hereinafter referred to as "Rules"). Rule 6.6.1
provides for constitution of Staff Sub-Committee. Rule 15.1 defines the
appointing authority in respect of Bank's officers/employees. So far as the
petitioners are concerned, their appointing authority is the Chief Executive
Officer of the Bank. Further, Rule 48.1 & 48.2 defines major and minor
punishments respectively while Rule 59.3 provides for procedure for
inflicting punishment.
[14]. Rule 71.2 of the Rules provides for compulsory retirement of an
employee of the Bank. Since, the impugned action has been taken under
this Rule, the same is reproduced hereunder for ready reference:
"71-2 vfuok;Z lsok fuo`r
cSad] fdlh lsok;qDr dks mlds }kjk 50 o"kZ dh vk;q izkIr djus ds
i'pkr ;k 20 o"kZ dh lsok iw.kZ djus ds i'pkr bueas ls tks Hkh
iwoksZRrj gks] 3 ekg dk uksfVl ¼lwpuk½ ;k uksfVl ds cnys 3 ekg
dk osru nsdj lsokfuo`Rr dj ldsxk rFkkfi bl fu;e ds v/khu
fdlh lsok;qDr dks lsokfuo`Rr djus ds iwoZ pfj=koyh ds vk/kkj
ij mlds dk;Z dk ewY;kadu ,oa ijh{k.k ds vk/kkj ij LVkQ
milfefr dk iwoZ vuqeksnu vko';d gksxkA"
[15]. Coming on to merits of the cases, in none of the writ petitions, the
petitioners have alleged any mala-fide against any authority nor is anyone
impleaded in its personal capacity. Thus, the impugned decision is to be
examined on remaining two grounds viz; whether it is based on 'no
evidence' or it is so arbitrary that no reasonable person would form such
opinion.
[16]. As reflected from the minutes of meeting of Staff Sub-Committee,
dated 17.06.2022, a finding is recorded that the petitioners have failed to
perform their duties efficiently inasmuch as there was negligible recovery
of loan, deposits and disbursement of loan in last five years. The Bank is a
financial institution and disbursement and recovery of loan is the
backbone for its survival. The Committee has recorded a finding that the
petitioners have failed to take interest in enhancing the Bank's business
and because of their lethargic performance, the Bank has suffered business
losses during last five years. The figures have been given in the minutes to
show the performance of the petitioners in the last five years in the matters
of recovery, deposits and disbursement of loan. Therefore, based upon the
petitioners' performance, if the Bank has recorded a finding that their
further continuance in service is not useful for the Bank, the same cannot
be said to be arbitrary to the extent that no reasonable person can reach to
such conclusion. Further, in the writ petition, the petitioners have not
denied the facts and figures given in the minutes of meeting of Committee.
Therefore, the same is presumed to be correct and if that be so, the
decision of Bank to compulsorily retire petitioners, cannot be said to be
without any evidence.
[17]. The learned counsel for petitioners strongly raised an objection that
the impugned order is stigmatic inasmuch as before issuing impugned
order, a show cause notice was issued to them proposing punishment of
compulsory retirement. It is his submission that the petitioners have been
compulsorily retired as a shortcut method to avoid conducing
departmental enquiry.
[18]. As seen from provisions of Rule 48.1 & 48.2 of Service Rules,
compulsory retirement of an employee is not a codified punishment, either
minor or major. Therefore, issuance of show cause notice proposing
punishment of compulsory retirement was wholly a misconceived act on
the part of the Bank officials. In fact, if the allegations made in the show
cause notice are seen, the same are nothing but the act of inefficiency of
petitioners in achieving desired target of recovery, deposits and
disbursement of loan. The same do not in fact constitute any misconduct
and could be a basis of compulsory retirement only under Rule 71.2 of
Service Rules. Thus, merely because a show cause notice was served to
the petitioners before issuance of impugned order, it cannot be said that
the impugned order is stigmatic and/or the same is passed as a short cut
method to avoid conducting enquiry.
[19]. The Apex Court was dealing with somewhat similar situation in the
case of State of U.P. Vs. Abhai Kishore Masta reported in (1995) 1 SCC
336 wherein the Apex Court held thus:
"8. In the State of U.P. Vs. Madan Mohan Nagar [(1967) 2
SCR 333 : AIR 1967 SC 1260] it has been held by a
Constitution Bench that the test to be applied in such matters
is "does the order of compulsory retirement cast an aspersion
or attach a stigma to the officer when it purports to retire him
compulsorily?" It was observed that if the charge or
imputation against the officer is made the condition of the
exercise of the power it must be held to be by way of
punishment --otherwise not. In other words if it is found that
the authority has adopted an easier course of retiring the
employee under Rule 56(j) instead of proceeding with and
concluding the enquiry or where it is found that the main
reason for compulsorily retiring the employee is the pendency
of the disciplinary proceeding or the levelling of the charges,
as the case may be, it would be a case for holding it to be
penal. But there may also be a case where the order of
compulsory retirement is not really or mainly based upon the
charges or the pendency of disciplinary enquiry. As a matter of
fact, in many cases, it may happen that the authority competent
to retire compulsorily under Rule 56(j) and authority
competent to impose the punishment in the disciplinary
enquiry are different. It may also be that the charges
communicated or the pendency of the disciplinary enquiry is
only one of the several circumstances taken into consideration.
In such cases it cannot be said that merely because the order of
compulsory retirement is made after the charges are
communicated or during the pendency of disciplinary enquiry,
it is penal in nature."
[20]. If the facts of these cases are examined keeping in view the
aforesaid legal position, it is found that the allegations made in show
cause notices and the foundation of passing impugned orders are similar.
As stated above, the so called allegations in fact do not constitute
misconduct but are the narration of inefficient performance of the
petitioners putting the Bank to business losses. Since, compulsory
retirement is not a codified punishment in Service Rules, proposing the
same as a punishment was only a misconceived act of Bank's official.
Therefore, the impugned order cannot be said to be stigmatic merely
because it was preceded by a show cause notice.
[21]. The next argument advanced by learned counsel for petitioners is
that the minutes of Staff Sub-Committee is vitiated because it was not
signed by the third member i.e. Deputy Registrar, Cooperative Societies.
[22]. As per Rule 6.6.1, in case of supersession of Bank, the Staff Sub-
Committee consists of three members viz; Administrator, one
representative nominated by State Govt. & the Chief Executive Officer of
the Bank. Admittedly, the minutes have been signed by Administrator and
CEO of the Bank. The question, therefore, is as to whether the minutes of
meeting would be vitiated for want of signature by third member?
[23]. The learned counsel for respondents submitted that the
Administrator was attending the meeting in dual capacity namely, as
Administrator as also the representative member of State Government. He
also submitted that the minutes were signed by majority and, therefore,
non-signing by third member would not vitiate the proceedings.
[24]. In this regard, if the provisions of Rule 71.2 of Service Rules are
seen, the power to compulsorily retire an employee lies with the Bank and
not with the Staff Sub-Committee. As per Rule 15.1, CEO is the
appointing authority of the petitioners. Therefore, the final decision is to
be taken by CEO. Since, the orders of compulsory retirement has been
passed by CEO of the Bank, the same would not be vitiated for want of
signature of one of the members of Staff Sub-Committee. Further, the
recommendation of Committee are made by two members which forms the
majority, therefore, non-signing of the same by one member would not
vitiate the entire proceedings.
[25]. The Apex Court was considering the similar situation, though in a
different context, in the case of State of M.P. Vs. Parvez Khan reported in
(2015) 2 SCC 591. It was a case where the matter was to be considered by
Screening Committee but was considered by Superintendent of Police who
happens to be the appointing authority. The Apex Court held as under:
"13. From the above observations of this Court, it is clear that
a candidate to be recruited to the police service must be
worthy of confidence and must be a person of utmost rectitude
and must have impeccable character and integrity. A person
having criminal antecedents will not fit in this category. Even
if he is acquitted or discharged, it cannot be presumed that he
was completely exonerated. Persons who are likely to erode
the credibility of the police ought not to enter the police force.
No doubt the Screening Committee has not been
constituted in the case considered by this Court, as rightly
pointed out by the learned counsel for the respondent, in
the present case, the Superintendent of Police has gone
into the matter. The Superintendent of Police is the
appointing authority. There is no allegation of mala fides
against the person taking the said decision nor the decision
is shown to be perverse or irrational. There is no material
to show that the appellant was falsely implicated. Basis of
impugned judgment [Parvez Khan vs. State of M.P., Writ
Appeal No. 262 of 2010, decided on 20-3-2012 (MP)] is
acquittal for want of evidence or discharge based on
compounding."
[26]. Like in the case before the Apex Court, in the present case also,
CEO is the appointing authority of petitioners. There is no allegation of
mala-fide levelled against him. Further, the decision taken has been found
to be based on cogent reasons and cannot be said to be perverse. Thus,
merely because the minutes of meeting of Staff Sub-committee was not
signed by one of its members, no benefit can be given to the petitioners.
[27]. The learned counsel for petitioners next contended that the
respondents were required to examine the entire service record before
taking the decision in these matters. He refers to ACRs of petitioners and
submitted that their ACRs are good and based upon the same, the
petitioners cannot be termed as deadwood.
[28]. In view of the discussion made above, this Court is of the
considered opinion that the decision to retire petitioners is based upon
sufficient reasoning and is the subjective satisfaction of employer. No
ground is therefore, made out for interference in the matter. Consequently,
the petitions fails and are dismissed.
(ASHISH SHROTI)
JUDGE
Vpn/-
