IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE ANTONY DOMINIC MONDAY, THE 27TH JULY 2009 / 5TH SRAVANA 1931 WP(C).No. 13380 of 2005(P) -------------------------- PETITIONER(S): ------------------ S.VIJAYAN, PANAMBIL HOUSE, S.L. PURAM, ALAPPUZHA. BY ADV. SRI.P.P.JACOB RESPONDENT(S): -------------------- 1. S.L.PURAM SERVICE CO-OPERATIVE BANK LTD. NO.A.64, S.L. PURAM, ALAPPUZHA, REP. BY ITS SECRETARY. 2. THE JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES (G), ALAPPUZHA. 3. STATE OF KERALA, REP. BY ITS SECRETARY TO GOVERNMENT CO-OPERATION (C) DEPARTMENT, SECRETARIAT, TRIVANDRUM. ADV. SRI.S.P.ARAVINDAKSHAN PILLAY FOR R1 SMT.N.SANTHA FOR R1 GOVT.PLEADER SRI.K.S.MOHAMMED HASHIM THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 15/07/2009, ALONG WITH WPC NO. 15389 OF 2005, THE COURT ON 27/07/2009 DELIVERED THE FOLLOWING: WPC NO.13380/2005 APPENDIX PETITIONER'S EXHIBITS EXT.P1: TRUE PHOTOCOPY OF JUDGMENT IN R.P.700/03 DT 21.6.2004. EXT.P2: TRUE PHOTOCOPY OF ORDER ISSUED BY 2ND RESPONDENT DT 10.11.2004. EXT.P3: TRUE PHOTOCOPY OF JUDGMENT IN WPC 1777/05 DT 1.2.2005. EXT.P4: TRUE COPY OF ORDER OF THE 3RD RESPONDENT DT 6.4.2005. EXT.P5: TRUE COPY OF PETITION FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DT 19.4.2005. EXT.P6: TRUE PHOTOCOPY OF THE DEPOSITIONS OF THE SECRETARY IN CHARGE AND PRESIDENT RELIEF ON THE DOMESTIC ENQUIRY. EXT.P7: TRUE PHOTOCOPY OF THE JUDGMENT IN C.C.C.972/97 DT 22.7.03. EXT.P8: TRUE PHOTOCOPY OF THE LETTER ISSUED BY FIRST RESPONDENT DT 16.3.2007. //TRUE COPY// P.A. TO JUDGE Rp ANTONY DOMINIC, J. ================ W.P.(C) NO. 13380 & 15389 OF 2005 ========================== Dated this the 27th day of July, 2009 J U D G M E N T WP(C) NO.13380/05 is filed by the Secretary of S.L.Puram Service Co-operative Bank which has filed WP(C) No.15389/05. The issue raised being common, these writ petitions are disposed of together and the parties are referred to as the Bank and Secretary. 2. For convenience, I shall be referring to the exhibits as produced in WP(C) No.15389/05. 3. The petitioner in WP(C) No.13380/05 was the Secretary of S.L.Puram Service Co-operative Bank. It is stated that in view of the enormous responsibilities attached to that post and the volume of business, an Assistant Secretary was appointed in the Bank. Thereafter in terms of Rule 196 of the Kerala Co-operative Societies Rules, amending the byelaws, substantial portion of the duties which were discharged by the Secretary were entrusted to the Assistant Secretary. While so, on 4/4/94, Ext.R3(g) show cause notice was issued to the Assistant Secretary mainly alleging misappropriation and other lapses committed by him. He filed WPC 13380 & 15389/05 :2 : Ext.R3(h) reply on the same day admitting misappropriation and undertaking to remit the amount. The Secretary reported the matter to the President and thereupon the Assistant Secretary was placed under suspension. He was chargesheeted, an enquiry was held and was found guilty. Accordingly, the Assistant Secretary was terminated from service w.e.f. 21/4/95 and to recover the losses, ARC 1309/1995, 1311/95 and 1312/95 were filed and by Ext.R3(k) order dated 15/11/96, his properties were also attached. 4. Meanwhile, the Department initiated an enquiry against the Bank under Section 65 of the Kerala Co-operative Societies Act, (hereinafter referred to as 'Act' for short) and during its pendency, on 18/5/95, a memo was issued to the Secretary alleging misconducts against him. Subsequently on 7/6/95, the Managing committee by Ext.R3(l) proceedings, resolved to await the outcome of Section 65 enquiry for taking further action against the Secretary. It was at that stage, according to the Secretary, the term of the Committee expired and on 29/6/95, election was held and a new set of office bearers assumed charge. Subsequently, on 21/11/96 by Ext.R3(p) order, the WPC 13380 & 15389/05 :3 : Secretary was placed under suspension and later, Exts.P1 and P2 memo of charges were issued to him. A reading of these documents show that 11 charges were levelled against the Secretary, out of which 9 were charges of misappropriation of Bank's funds. Charge Nos. 10 and 11 related to defaults committed in realising interest due to the Bank. Secretary filed Exts.P3 and P4 explanations. The disciplinary authority was not satisfied with the explanation submitted and appointed an Advocate as Enquiry Officer to conduct a domestic enquiry. 5. In the meanwhile, by Ext.P5 order, the Joint Registrar approved extension of the period of suspension by six months from 20/11/97. Witnesses were examined in the enquiry and copy of the deposition is produced as Ext.P6 in WP(C) No.13380/05 filed by the Secretary. A reading of these depositions show that witnesses were consistent in their evidence that in all cases of misappropriation, documents were manipulated by Assistant Secretary himself and none of them implicated the Secretary in any manner. However, Ext.P6 report was submitted by the enquiry officer, which shows that despite the oral evidence as above and against the charges of WPC 13380 & 15389/05 :4 : misappropriation, the enquiry officer found that the Secretary was responsible for the misconducts committed and that the misconducts were committed with his connivance. It is to be noticed that there was no charge to this effect in Exts.P1 and P2. The report of the enquiry was accepted by the Sub Committee of the Board, which issued Ext.P7 show cause calling upon the Secretary why the punishment of dismissal shall not be imposed. He submitted Ext.P8 reply and was granted an opportunity of personal hearing on 15/5/98. During the course of the hearing, the Secretary also submitted Ext.P9 representation pleading for leniency in the matter. However, the Sub Committee issued Ext.P10 order dated 15/5/98 dismissing the Secretary from service. He filed Ext.P11 appeal to the Managing Committee, which was also rejected by Ext.P12 order. 6. Thereafter, the Secretary moved the Joint Registrar under Rule 176 of the Rules challenging the suspension, dismissal and rejection of his appeal. Joint Registrar heard the parties pursuant to Ext.P13, and by Ext.P14 order, the resolutions were rescinded and it was also held that the continuance of the suspension beyond 20/5/97 was illegal. Bank thereupon filed WPC 13380 & 15389/05 :5 : Ext.P15 appeal to the Government under Section 83(1)(j) of the Act, in which the Government passed Ext.P16 order staying Ext.P14 order of the Joint Registrar. The appeal was considered and by Ext.P17 order, Ext.P15 appeal was rejected. Exts.P14 and P17 were challenged by the Bank in OP. No.16355/2000. That original petition was disposed of by this Court as per Ext.P18 judgment, the operative portion of which reads as under. Therefore, I dispose of the original petition with the following directions. (1) The sub-committee will consider the enquiry report pertaining to the 3rd respondent afresh, by constituting a new sub-committee. The third respondent will be afforded an opportunity for hearing by the sub-committee. (2) It will be open to the sub committee to pass appropriate orders thereafter. (3) In case, the third respondent is aggrieved by the order thus passed by the sub committee, it will be open to the third respondent to file an appeal before the managing committee. (4) The third respondent will be deemed to be under suspension till appropriate orders are passed by the sub committee and the continuance of the suspension will depend on the orders to be passed by the sub committee. (5) Since the third respondent is under suspension, there will be direction to the petitioner bank to see that the entire subsistence allowance due to the third respondent as applicable to the Secretary is paid WPC 13380 & 15389/05 :6 : forthwith, at any rate, within a period of one month from today. In order to enable the matter to be thus considered afresh, I quash Exts.P9, P14 and P18 orders. 7. Accordingly, Ext.P19 show cause notice was issued by the Sub Committee enclosing a copy of Ext.P6 report submitted by the enquiry officer and in response, the Secretary submitted Ext.P20 reply. While so, the 2nd respondent passed order dated 9/7/02 directing that the proceedings against the Secretary be completed before 31.7.02 and to send an action taken report before 5.8.2002. Against this proceedings, Bank filed an appeal to the Government and stay sought was declined by the Appellate Authority. This order was challenged before this Court in OP No.23039/02. The original petition was disposed of by Ext.P21 judgment directing the Government to pass orders in the appeal filed by the Bank with notice to the parties and to keep in abeyance order dated 9.7.2002 in the meanwhile. It was also directed that until orders are passed as above, the parties will be governed by Ext.P18 judgment in OP No.16355/2000. Finally, order was passed by the Government on 26/8/2003 and the Bank was directed to pass final orders in the disciplinary proceedings against the Secretary as directed by the Joint Registrar. WPC 13380 & 15389/05 :7 : Accordingly, personal hearing was granted and the Secretary appeared before the Sub Committee. The Sub Committee issued Ext.P22 show cause notice proposing the punishment of compulsory retirement to which the Secretary submitted Ext.P23 reply and was granted a personal hearing. Finally, Ext.P24 resolution was passed on 30/4/2003 imposing a punishment of compulsory retirement on the Secretary. 8. Against the punishment thus imposed, Ext.P25 appeal was filed before the Managing committee. While the appeal was pending, he also filed Ext.P26 representation to the President of the Bank expressing his willingness to go on voluntary retirement. Managing Committee dismissed Ext.P25 appeal as per Resolution dated 31/1/2004 with a further direction to treat his period of suspension as duty for pension and gratuity and to limit his other monetary benefits to the subsistence allowance that was already paid. On that day, viz., 31/1/2004, Secretary also attained the age of superannuation. The resolution rejecting his appeal was communicated to the Secretary by Ext.P27 order dated 6.2.2004. 9. In the meanwhile, the Bank filed RP No.700/03 seeking review of Ext.P18 judgment. Review petition was disposed of by WPC 13380 & 15389/05 :8 : Ext.P28 order dated 21.6.2004 and Para 2 and 3 of the order, being relevant, are extracted below for reference. 2. Learned counsel appearing for the Bank submits that since the petitioner has already invoked one statutory remedy of appeal before the appellate authority, it is only appropriate that he pursues his statutory remedies either before the Joint Registrar of Co-operative Societies under Rule 176 or by way of an arbitration. Since reference is already therein to the order passed by the Joint Registrar of Co-operative Societies, learned counsel for the petitioner submits that he may be permitted to pursue his remedy before the Joint Registrar under Rule 176 of the Kerala Co-operative Societies Rules. In the facts and circumstances, it is only appropriate that the Joint Registrar of Co-operative Societies, Alappuzha entertains the petition preferred by the petitioner in the matter. Therefore, I dispose of the Review Petition as follows: 3. In the event of the Review Petitioner filing an appropriate petition under Rule 176 of the Kerala Co- operative Societies Rules, 1969, within a period of one month from today, the same shall be treated to have been filed in time taking note of the pendency of the Review petitions before this Court. Thereafter, the Joint Registrar of Co-operative Societies, Alappuzha will consider the same on merits with notice to the review petitioner and the respondent Bank. Appropriate orders in accordance with law thereon shall be passed within a period of four months from the date of receipt of the petition under Rule 176. It is made clear that in the event of the Joint Registrar rescinding the impugned resolutions, appropriate consequential orders shall also be passed including that on back wages taking note of the fact that the petitioner has already crossed the age of superannuation. (emphasis supplied) 10. Accordingly, Secretary moved the 2nd respondent by a WPC 13380 & 15389/05 :9 : petition seeking to invoke his power under Rule 176 of the Rules to rescind Ext.P26 and the resolution dated 31.1.2004. On its receipt, the 2nd respondent issued Ext.P29 notice calling upon the Bank why the resolutions shall not be rescinded. In Ext.P30 reply filed by the Bank, among others, it is stated that it had not received a copy of the petition filed by the Secretary and that therefore they could not file an effective reply. The Bank also sought a copy of the petition for filing a detailed reply. However, without giving copy as sought for, the 2nd respondent issued Ext.P31 proceedings rescinding the resolutions and ordering to pay all dues to the Secretary as if he had continued in service without any break. Against Ext.P31, Bank filed Ext.P32 appeal before the Government under Section 83(i)(j) of the Act and also sought stay of Ext.P31. By order dated 5/1/2005, prayer for stay of Ext.P31 was rejected. At that stage, the Secretary filed WP(C) No.1777/05 before this Court for implementing Ext.P31 order passed by the Joint Registrar. That writ petition was heard and disposed of by Ext.P33 judgment directing an expeditious disposal of Ext.P32 appeal, the operative portion of the judgment reads as under. WPC 13380 & 15389/05 :10 : Be that as it may, the facts remains that the appeal as referred to in Ext.P3 is pending before the Government. There will be a direction to the 4th respondent to dispose of the appeal referred to in Ext.P3 with notice to the petitioner and the first respondent. This shall be done within six weeks from the date of production of a copy of this judgment by either party. Depending on the orders thus passed, action will be taken by the first respondent to settle the dues of the petitioner, needless to say, without prejudice to the right of the first respondent to take recourse to the constitutional remedies if so advised. In the meanwhile, taking note of the factual matrix as appearing in the writ petition, petitioner shall be paid an amount of Rs.3 lakhs within a week from today. Subject to the payment of the amount as above, there shall be no coercive steps pursuant to Ext.P2. 11. Accordingly, the appeal was considered and by Ext.P34 Government Order, the same was dismissed. It is thereupon that the Secretary filed WP(C) No.13380/05 for the implementation of Exts.P31 and P34 referred to above and the Bank has filed WP(C) No.15389/05 seeking to quash Exts.P31 and P34. 12. On behalf of the Bank, the contentions raised are mainly two fold. The first one is that the Joint Registrar had no jurisdiction under Rule 176 to interfere in a disciplinary matter and that the remedy available to the Secretary was to have pursued his grievance under Section 69(2)(d) of the Act, it being a dispute. It was then contended that in Ext.P31, documents which WPC 13380 & 15389/05 :11 : were not disclosed to the Bank were relied on and therefore the order is passed in violation of the principles of natural justice. Lastly, it was contended that at any rate, the Bank should not have been saddled with the liability to pay back wages for the whole period as the Secretary did not work during the period in question. 13. On behalf of the Secretary, the petitioner in WP(C) No.13380/05, it was contended that this is a case of no evidence in the disciplinary enquiry and inspite of it, the enquiry officer submitted his report with perverse findings of guilt and therefore, he is entitled to have the reliefs that were granted by the Joint Registrar and the Government. In so far as the case of the Bank that the Joint Registrar had no jurisdiction to have entertained the matter, learned counsel for the Secretary relied heavily on Ext.P28 order passed by this Court in the review petition. He also contended that even if there is substance in the plea, in the facts of this case, there is no warrant for interference with the orders. According to him, so long as Ext.P28 inter party order remains in force, it was not open to the Bank to contend that Joint Registrar had no jurisdiction in the matter. WPC 13380 & 15389/05 :12 : 14. The first contention to be addressed is whether the Joint Registrar had jurisdiction to have entertained the petition filed by the Secretary. Rule 176 of the Co-operative Societies Rules confer power on the Registrar to rescind any resolution if it appears to him that such resolution is ultra vires the objects of the society, or is against the provisions of the Act, Rules Bye-laws or of any direction or instructions issued by the Department, or is calculated to disturb the peaceful and orderly working of the Society or is contrary to the better interest of the Society. Section 69 of the Act was amended w.e.f. 2/1/2003 and Section 69(2)(d) provides that any dispute arising in connection with employment of officers and servants of different classes of societies specified in Section 80(1) including their promotion and inter se seniority shall be deemed to be a dispute for the purpose of Section 69(1). According to the counsel, Section 69(2)(d) provides for a specific remedy and the general power contained in Rule 176 cannot be invoked in a dispute in connection with the employment of staff in the societies. Counsel referred me to the decisions of this Court in Parappuram Milk Producer's Co-operative Society v. Deputy Director, Department of Dairy Development (1999 WPC 13380 & 15389/05 :13 : (1) KLT 121), Prakasini v. Joint Registrar (2006(1) KLT 199) and Raveendran v. State of Kerala (2007(3) KLT 558). 15. In Parappuram Milk Producer's Co-operative Society v. Deputy Director, Department of Dairy Development(1999(1) KLT 121), a Division Bench of this Court held that under Rule 176, the Joint Registrar can rescind the resolution only in the circumstances specified in the Rule and that taking of disciplinary action against an erring employee is not intended to disturb the peaceful and orderly working of the society or cannot be said to be contrary to the better interest of the society or ultra vires the objects of the society. Proceeding further, referring to Section 69(2)(d), it is also held that an employee can approach the Arbitrator and that in proceedings under Rule 176, the Joint Registrar can certainly examine whether Rule 198 or any other provision of the Act or Rules or bye-laws were violated or not, while taking disciplinary action, notwithstanding the right of appeal or any other alternate remedy. However, subsequent to the amendment of the Act, w.e.f. 2/1/2003, the scope of Rule 176 vis-a-vis Section 69 was examined by this Court and in Prakasini v. Joint Registrar WPC 13380 & 15389/05 :14 : (2006(1) KLT 199), it has been held as follows. Before the said P1 decision was taken, amendments made as per Act 1 of 2000 to S.69 of the Co-operative Societies Act were given effect to, with effect from 2.1.2003. Thereby Clause (d) of sub-s.2 of S.69 brought all disputes in connection with the employment, including their promotion and inter se seniority under the canopy of the word 'disputes' for the purpose of S.69(1). The last limb of S.69(1) provides that such disputes shall be decided by the arbitration court or the Registrar, as the case may be and no other court or authority shall have jurisdiction to entertain any suit or other proceedings in respect of such dispute. In my considered view, this is a clear statutory exclusion of the authority under R.176 of the KCS Rules, which otherwise was being exercised in relation to such disputes. So much so, there cannot be any statutory adjudication by any authority other than the arbitration court or the Registrar, as the case may be of any dispute in relation to a decision as to inter se seniority between employees, taken by the employer on or after 2.1.2003. In that view of the matter, Ext.P4 decision of the Joint Registrar of Co-operative Societies in purported exercise of authority under R.176 of the Rules and Ext.P5 appellate order passed by the Government lack in jurisdiction and they cannot, therefore, stand, they being void. 16. This issue was again considered by a Division Bench in Raveendran v. State of Kerala (2007(3) KLT 558), where, after referring to Section 69, it was held that on a reading of the statutory provision, it was clear that any dispute arising in connection with employment of officers and staff of different classes of societies is to be decided only by the Arbitration Court. WPC 13380 & 15389/05 :15 : The Division Bench has expressly endorsed the view taken in Prakasini's case referred to above. Therefore, it would appear that the effect of the amendment introduced to Section 69 w.e.f. 2/1/2003 is that the Registrar, who had a limited power under Rule 176 is now deprived of that power and the jurisdiction is now conferred exclusively on the Arbitration Court. 17. Inspite of the above, question would still survive whether in the facts of this case, the proceedings deserve to be interfered with. Ext.P28 order dated 21/6/2004 passed by this Court in RP NO.700/03 would show that none other than the petitioner themselves had contended that the remedy available to the Secretary was to pursue the matter under Rule 176 or in Arbitration. It was thereupon that the petitioner chose to pursue his remedy under Rule 176. Accordingly, this Court directed that in the event the petitioner files a petition under Rule 176 of the Rules, the same will be considered on merits with notice to both parties. It was accordingly that the Secretary filed a petition to rescind the resolution resulting in Ext.P31 order which was confirmed by the Government in Ext.P34. Not only that the petitioner did not challenge Ext.P28 order passed by the learned WPC 13380 & 15389/05 :16 : Single Judge but also that no contention was raised before the Joint Registrar that the petition filed under Rule 176 was not maintainable. 18. The effect of inter party judgments which have attained finality has been considered by a Division Bench of this Court in Union of India v. Central Administrative Tribunal, Ernakulam Bench (2002(1) KLT 840). In that judgment, it has been held that such judgments which have attained finality cannot be nullified and set at naught even by subsequent decisions of the Apex Court even though issue involved may be the same. That apart, in Sooryanathan v. State of Kerala (2004(1) KLT 383), a learned Single Judge of this Court took the view that when the High Court, a superior court of unlimited jurisdiction, directs consideration of matter, there is nothing wrong in the disposal of the matter on merits, irrespective of the dispute on its maintainability. It is also held that an order of this Court, unless it is modified in appropriate proceedings like appeal or review, is binding on all parties and the concept of voidness is not at all applicable to the orders of superior courts of unlimited jurisdiction. If the principles thus laid down in the aforesaid two WPC 13380 & 15389/05 :17 : judgments are applied to the case in hand, it can be seen that the Bank, the Secretary and the Joint Registrar are bound by Ext.P28 order where the Joint Registrar was asked to consider the petition filed under Rule 176 on merits and pass orders thereon. Consequently, the Joint Registrar, who was bound by Ext.P28 order of this Court, could not have avoided consideration of the issue on merits. Further, in view of the fact that Ext.P28 has attained finality and is binding on the parties in these writ petitions, it is also not open to the petitioner Bank to now contend that the remedy of the Secretary was to have pursued the proceedings not under Rule 176, but under Section 69(2)(d) of the Act. 19. There is yet another way of looking at the problem. The disciplinary proceedings in question was initiated in 1996 and the Secretary was dismissed by order dated 15/5/98. Thereafter, after several rounds of litigation, he was compulsory retired on 30/4/2003 and he also attained the age of superannuation on 31/1/2004. If at this distance of time, I am to hold that the remedy of the Secretary was