IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD TUESDAY, THE TWENTY FIRST DAY OF JULY TWO THOUSAND AND NINE PRESENT THE HON'BLE SRI JUSTICE GHULAM MOHAMMED and THE HON'BLE SRI JUSTICE VILAS V. AFZULPURKAR WRIT APPEAL NO : 2263 of 2005 (Writ Appeal under Clause 15 of the Letters Patent against the Order dated 05/10/2005 in WP NO : 21064 OF 2005 on the file of the High Court.) Between: 1 Bhimavaram Co-Operative Urban Bank Ltd., rep. by its Secretary, Bhimavaram, W.G.District. 2 Bhimavaram Co-operative Urban Bank Ltd. Rep by its Special Officer, Bhimavaram, West Godavari District. ..... APPELLANT AND 1 R.N. Gopopal, S/o. Subbarayudu, M/s Bhimavaram Co-operative Uban Bank Ltd. Bhimavaram, R/o. Bhimavaram, West Godavari District 2 District Co-Operative Officer ( F.A.C.), W.G. District at Eluru. .....RESPONDENT(S) Counsel for the Appellant: MR.Y.V.RAVI PRASAD Counsel for the Respondents : GP FOR COOPERATION The Court made the following : THE HON’BLE SRI JUSTICE GHULAM MOHAMMED AND THE HON’BLE SRI JUSTICE VILAS V. AFZULPURKAR W.A.No. 2263 of 2005 ORDER: (Hon’ble Sri Justice Ghulam Mohammed) 1. This writ appeal is directed against the order dated 5.10.2005 passed by a learned single Judge of this Court in W.P.No. 21064 of 2005. The parties are being referred to as they are arrayed in the writ petition. 2. The writ petition was filed challenging a Memo No. ROC (Co-Operation) No. 906/05-F1, dated 19.7.2005 issued by the 1st respondent. The said memo states that the writ petitioner is going to be retired from service on 31.7.2005 due to his superannuation and the 2nd respondent was directed not to pay any benefits on his retirement pending inquiry into the allegations. 3. The petitioner worked as a secretary in Bhimavaram Co-Operative Urban Bank Limited-2nd respondent and he retired from service on 31.7.2005. By the impugned memo, the petitioner’s retirement benefits were directed not to be paid pending inquiry into allegations. The learned single Judge has gone into the issues and considered the rival contentions of the parties, and found that no disciplinary proceedings were pending against the petitioner and the impugned memo was issued in contemplation of an enquiry into the allegations leveled against the petitioner and as such the petitioner could not be denied retirement benefits. Accordingly the learned single Judge allowed the writ petition directing the 2nd respondent to release of retirement benefits to the petitioner. Aggrieved thereby, the present writ appeal is filed by 2nd respondent. 4. The learned counsel appearing for the 2nd respondent-appellant contended that an inquiry into the affairs of Bhimavaram Co-Operative Urban Bank Limited, Bhimavaram was ordered under Section 51 of the Andhra Pradesh Co-Operative Societies Act, 1964 (for short “the Act”) and the inquiry revealed that the Managing Committee of the said bank irregularly spent an amount of Rs.6.80 lakhs towards legal fee for filing writ petitions in the High Court against the instructions issued by the Reserve Bank of India and accordingly a surcharge order was passed under section 60 (1) of the Act for an amount of Rs.6.80 lakhs together with interest at 18% per annum against the managing committee members of the co-operative bank. He submits that the managing committee members filed appeals before the Andhra Pradesh Co-Operative Tribunal, Vijayawada in O.A.Nos.96 and 98 of 2007 and the matter was remanded back to the Deputy Registrar of Cooperative Societies, Bhimavaram with a direction to conduct a fresh surcharge inquiry under Section 60 of the Act. The learned counsel submits that as the enquiry is not concluded, and in order to protect the interest of the cooperative bank, the impugned memo was issued by the 2nd respondent. 5. On the other hand, the learned counsel for the writ petitioner contended that the learned single Judge has considered the matter in a right prospective manner and there is no justification to interfere with his order and he has drawn our attention to Section 4 (6) of the Payment of Gratuity Act, 1972 and contended that gratuity payable to an employee, wholly or partially, shall be forfeited if the services of such employee have been terminated for any misconduct and this is not a such case, particularly when once the relationship of employee and employer comes to an end with the retirement of the petitioner on attaining the age of superannuation without any disciplinary proceedings. He has relied on a judgment of this Court reported in Y. Tatachary Vs. Acharya N.G. Ranga Agricultural University, Hyderabad [1] and in paras 7 and 8 this court held, “7. An employee is entitled to pension and gratuity earned by him on his superannuation. The very object of payment of pension to an employee, who served the University faithfully, is to mitigate his financial constraints and enable him and his family enjoy a happy life after retirement. It is not disputed that the Legislature paid special attention to the pensionary benefits of an employee viz., that an employee is entitled to pension in accordance with the statutory rules governing and it can be denied only in cases where the employee was awarded with punishment of stoppage of pension, and also in cases where the pension is sought to be attached in execution of a decree for recovery of any amount by a Competent Court and for the recovery of the loss caused by the employee during his employment. It is well-settled principle of law, and it cannot be gainsaid that not more than one-third of the pension can ever be deducted even for recovery of any loss caused by an employee during the course of his/her employment. 8. Rule 44 of the Pension Rules for University Teachers, 1992 mandates that gratuity shall not be paid to the teacher of the university unless the departmental proceedings or judicial proceedings are concluded and final orders thereon are passed. In the instant case, admittedly, there is no departmental proceedings or judicial proceedings, pending against the petitioner in which final orders are being awaited.” 6. We have considered the submissions of the learned counsel for the parties and we are of the opinion that in terms of Section 4 (6) of the Payment of Gratuity Act 1972 an employer can withhold the gratuity of an employee if the services of the employee have been terminated for any act, wilful omission or negligence causing any damage or loss or destruction of property belonging to the employer or for any misconduct. In this case, the services of the petitioner were not terminated and he retired from service on attaining the age of superannuation. The impugned memo issued by the 1st respondent directing the 2nd respondent to withhold the retirement benefits of the petitioner is not sustainable in law as it was passed without conducting any enquiry. The enquiry is still pending, as according to the learned counsel for the appellant, with Deputy Registrar of Cooperative Societies, Bhimavaram by virtue of remand order of the Andhra Pradesh Co-Operative Tribunal, Vijayawada referred to above. In the circumstances, the petitioner cannot be fastened with any liability without any enquiry. We do not find any infirmity or illegality in the order of the learned single Judge. 7. The writ appeal fails and it is accordingly dismissed. No order as to costs. _____________________________ JUSTICE GHULAM MOHAMMED ________________________________ JUSTICE VILAS V. AFZULPURKAR Dt. 21.7.2009 KR ........REGISTRAR To 1. 2.2 CD copies Form-NIC-OGS/WA {JGK} [1] 2000 (2) ALD 567 (DB)