IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED;22.07.2011 CORAM; THE HONOURABLE MR.JUSTICE T.RAJA W.P.NO.27699 OF 2004 B.Navaneetha Kannan ..Petitioner vs 1.The Administrator/Managing Director The Pondicherry Co-operative Milk Producer's Union Ltd., No.P.1, Vazhudavoor Road Kurumampet Pondicherry 605 009 2.The Registrar of Co-operative Societies Government of Pondicherry Thattanchavadi Pondicherry 605 009 ..Respondents Writ Petition is filed under Article 226 of the Constitution of India praying for issuance of a writ of Certiorarified Mandamus to call for the records in pursuant to the impugned dismissal order passed by the 1st respondent in Ref.Ponlait/Estt/P.A.No.4/2004 dated 25.08.2004 and the subsequent Appeal Rejection order passed by the same 1st respondent in Ref.Ponlait/Estt/P.A.No.4/2004 dated 30th June 2010 and quash the same consequently directing the respondents to pay all the cumulative monetary benefits arising therefrom. (Prayer amended as per order dated 17.8.10 by KBKVJ in WPMP 399/2010 in WP 27699/2004) for petitioner :Mr.V.Prakash senior counsel for Mr.T.Kalaimani for respondents :Mr.L.Swaminathan (for R1) Ms.N.Mala Additional Government Pleader (Pondicherry) (for R2) https://hcservices.ecourts.gov.in/hcservices/ O R D E R The petitioner B.Navaneetha Kannan has filed the present writ petition initially against the dismissal order passed by the first respondent in Ref.Ponlait/Estt/P.A.No.4/2004 dated 25.8.2004 and quash the same and for a consequential direction to the respondents to reinstate the petitioner in service with all attendant benefits. At the very outset, it is relevant to mention that during the pendency of the Writ Petition, the petitioner has amended the prayer to quash the order dated 25.08.2004 and the subsequent Appeal Rejection Order passed by the first respondent in Ref.Ponlait/Estt/P.A.No.4/2004 dated 30th June 2010 and quash the same, consequently directing the respondents to pay all the cumulative monetary benefits arising therefrom. 2. (i) The petitioner joined the services of the Pondicherry Co-operative Milk Producers Union Ltd., as Dairy Assistant in the year 1971 and he was promoted to the post of Assistant General Manager in the said Union Ltd. While he was serving, he was also holding the additional charge of the post of Managing Director, Pondicherry Co-operative Milk Producers' Union during the period from May 1995 to January 2001. For about 5 1/2 years, the petitioner was functioning as Managing Director. While so, he was placed under suspension by proceedings dated 30.6.2002. Aggrieved by the suspension order, the petitioner filed W.P.No.25595/2002 on the file of this Court under Article 226 of the Constitution of India. At the time of admission of W.P.No.25595/2002 itself, the writ petition was withdrawn and the petitioner was reinstated into service on 15.02.2003. (ii) In the meanwhile, the second respondent has issued a direction to the first respondent to constitute an Expert Panel as per the bye-laws to select the Managing Director and accordingly, when an advertisement was given in a daily newspaper for the post of Managing Director on 29.10.1999, four applications were received. Out of the same, three were found ineligible as per the terms mentioned in the advertisement and bye-laws and the petitioner was the only eligible candidate. At that point of time, the second respondent issued a direction to the first respondent not to consider the petitioner's application for the post. On that basis, the Expert Panel adjourned the proceedings sine die without appointing the petitioner. Therefore, the petitioner preferred W.P.No.18210/1999 against the direction issued by the second respondent not to consider the petitioner's application. Subsequently, the first respondent also filed another Writ Petition-W.P.No.4785/1999 against the direction. Both Writ Petitions were taken up together and, by a common order, dated 5.5.2000, in W.P.No.18210/1999, the impugned direction challenged by the petitioner dated 9.11.1999 was quashed as prayed by the petitioner and finally, a direction was issued to the Expert https://hcservices.ecourts.gov.in/hcservices/ Panel to consider the petitioner and the other Writ Petition- W.P.No.4785/1999 was dismissed. (iii) Thereafter, when the order of the Court was not properly implemented, the petitioner preferred Contempt Petition Nos.497 and 631 of 2000 and WMP Nos.23143, 23144, 23318 and 18717 of 2000. This Court, by taking up both the Contempt Petitions together passed an order on 22.1.2001, appointing one Mr.Uddipt Ray, I.A.S., Joint Secretary, Government of Pondicherry, as the Special Officer to exercise all powers of the Chairman, Board of Directors and Managing Director of the Union and also to take all necessary steps to select and appoint the Managing Director within four months. As a result, the Chairman and the Board of Directors were restrained from acting in their capacity until further orders. In the meanwhile, the petitioner was directed to go on Special Leave with payment of full salary until further orders. Subsequently, the appointment of the Special Officer was stayed and the Board was permitted to proceed with the selection of Managing Director. Again, interview for the post of Managing Director was conducted on 11.6.2001 and one Rajeswaran was selected to the post of Managing Director. But the petitioner's name was at the second place in the selection list, thereby, the position was, in case Rajeswaran did not report, the petitioner would be appointed. However, Rajeswaran was appointed as Managing Director on 11.7.2001. Subsequently, the respondent Management filed W.A.No.315/2001. By order dated 8.2.2002 the first Bench of this Court passed an order to take back the petitioner's services. Accordingly, the petitioner joined services on 1.3.2002 as Assistant General Manager. In view of the aforementioned circumstances by which the petitioner was placed for appointment to the post of Managing Director, Mr.Rajeswaran started giving trouble from the date of appointment and finally the said Rajeswaran as Managing Director placed the petitioner under suspension without giving any specific reason on 1.7.2002 which continued till 14.2.2003. Subsequently, the said Rajeswaran who had grudge against the petitioner has given a newspaper publication in three Tamil dailies asking the public not to have touch with him. In these circumstances the petitioner was issued with a charge memo containing 9 charges on 12.8.2002 for allegations that he along with the Chairman took a circuitous route for the Agri.Tech.99 Exhibition at Isreal from 2.9.2000 to 10.9.2000 instead of resorting to the direct route. (iv) In the meanwhile, the said Rajeswaran, Managing Director was also placed under suspension by the Deputy Registrar of Co- operative Societies. Subsequently, the said Deputy Registrar was appointed as Special Officer. Immediately, on receipt of the abovesaid charges, the petitioner submitted his explanations. The disciplinary authority not being satisfied with the said explanations dated 3.2.2003 ordered for appointment of the Enquiry Officer to go into the charges framed against the petitioner. The Enquiry Officer https://hcservices.ecourts.gov.in/hcservices/ also commenced the enquiry on 27.9.2003. On completion of the enquiry, the Enquiry Officer submitted his report on 28.11.2003. (v) After the Enquiry Officer accepting the explanation offered by the petitioner, the Chairman, by proceedings dated 19.11.2002, had dropped charges 7 and 8 relating to the price of ghee per kilo gram. Further, the Enquiry Officer not only held that the management has not proved charge Nos.1 and 2 but also, by accepting the evidence of Mr.Gunasekaran, exonerated the petitioner from charge No.5. In respect of charge No.6, the Enquiry Officer, acting upon the evidence of Sakthivel, Deputy Manager, came to the conclusion that the loss was not due to the charged officer. Accordingly, charge No.6 was also not proved. In respect of charge No.5 that he acted against the interest of the Union by placing orders for the purchase of disposable cups without calling for quotations, the Enquiry Officer exonerated the petitioner. Regarding charges 3 and 4 alleging inaction of the petitioner against the Junior Assistant G.Arumugam, by accepting the evidence of Mr.G.Arumugam, the Enquiry Officer held that the management has failed to prove the said charges as well. As regards charge No.9 pertaining to the allegations that the petitioner, during his suspension went to Chennai leaving the Head quarters, it was specifically held that he went to Lawspet in Pondicherry to consult his lawyer and he did not leave Pondicherry. Accordingly, Charge No.9 was also dismissed. (vi) Finally, the Enquiry Officer after thorough enquiry, has come to the conclusion that no charges have been made out and so, concluding exonerated the petitioner based on the evidence and documents produced by both sides. After submission of the report by the Enquiry Officer, the respondent ordered for a de novo enquiry for a purported reason that the Enquiry Officer has forwarded the report to the Disciplinary authority through the Presenting Officer of the Department. Besides, the Disciplinary Authority, after receipt of the enquiry report, while differing from the report of the enquiry officer, without issuing a show cause notice, calling upon the petitioner to show cause as to why the disciplinary authority should not ignore such report, hastily proceeded to hold a de novo enquiry. When the disciplinary authority issued an order for holding a de novo enquiry on 21.1.2004, the petitioner, by filing W.P.No.2394/2004 challenged, the said order on the ground that the disciplinary authority failed to give an opportunity of representation to the charged employee before differing with the findings, which is against the ruling of the Hon'ble Apex Court in the decision rendered in MANAGING DIRECTOR, E.C.I.L., HYDERABAD v. B.KARUNAKAR (II) (1993 (4) SCC 727). This Court, by an interim order, dated 9.2.2004 passed in W.P.M.P.No.2702/2004 in W.P.No.2394/2004 directed that the enquiry may go on, however, to withhold the result till further orders. Subsequently, the enquiry proceedings were conducted and thereafter, when the petitioner wanted to choose one Dr.T.Velayutham a retired Government employee as a defence assistant the said request of the https://hcservices.ecourts.gov.in/hcservices/ petitioner was not considered. Nonetheless, a Writ Appeal came to be filed in W.A.No.2642/2004. (vii) Mr.V.Prakash, learned senior counsel further contended that the de novo enquiry proceedings, dated 21.1.2004, shall be held as void-ab-initio for the reason that the first Enquiry Officer conducted a detailed exhaustive enquiry dealing with all charges from 1 to 9. Except charge Nos.7 and 8 which were already dropped by the Government, the Enquiry Officer categorically found the petitioner "not guilty" of any of the charges. Accordingly, the Enquiry Officer submitted his report on completion of the enquiry. After completion of the first enquiry, the decision to initiate de novo enquiry dated 21.1.2004, once again subjecting the petitioner to second enquiry, is in total violation of the principles of natural justice and also against the dictum laid down in MANAGING DIRECTOR, E.C.I.L., HYDERABAD V. B.KARUNAKAR(II) (1993 (4) SCC 727) (viii) As per the judgment of the Constitution Bench when the first enquiry officer's findings recorded in favour of the delinquent officer are proposed to be overturned by the disciplinary authority, the principles of natural justice requires that the employee should have a fair opportunity to meet, explain and to controvert before he is condemned. In other words, it was contended by the learned senior counsel that when the findings in favour of the delinquent officer are proposed to be overturned by the Disciplinary Authority, a fair opportunity should be granted to the delinquent officer before the disciplinary authority proceeds to differ with such conclusion, as otherwise, he would be condemned unheard. (ix) In the present case, curiously, in respect of charges 1 to 6 and charge No.9, a de novo enquiry was ordered and the second enquiry officer once again proceeded against the petitioner also to deal with charge Nos.7 and 8 which were already dropped by the Chairman, and it was found that the petitioner was guilty of charge Nos.7 and 8 as well. This approach of the second Enquiry Officer holding the petitioner guilty of even charge Nos.7 and 8 which were already dropped by the Chairman itself, goes without saying that not only the Enquiry Officer conducted the de-nove enquiry without application of mind, but also, the disciplinary authority, while passing the dismissal order against the petitioner by accepting the findings of the second Enquiry Officer, repeated the same irregularities and mistake of non-application of mind in accepting the findings of the second enquiry officer even though charge Nos.7 and 8 which were already dropped by the Government. (x) Adding his submission, the learned senior counsel submitted that the learned single judge passed an order dated 20.6.2004, in W.P.No.2394/2004, directing the respondents to conduct an enquiry on day-to-day basis and complete the same on or before 15.7.2004. Having aggrieved by the said order the petitioner preferred https://hcservices.ecourts.gov.in/hcservices/ W.A.No.2642/2004. The First Bench of this Court, by order dated 12.7.2004, directed the matter to be posted on 19.7.2004 and in the meanwhile, the enquiry may be completed and even the findings can be recorded by the Enquiry Officer and the same may be placed before the Court in a sealed cover. According to the learned senior counsel appearing for the petitioner, in spite of such clear and specific direction by the Division Bench of this Court to record only the findings of the enquiry officer, the respondent once again, defying the order passed by this Court, straight away passed the final order, dismissing the petitioner from service. This shows the second motivated action against the petitioner. (xi) Further when W.A.No.2642/2004 was taken up on 20.7.2004, on being apprised of the dismissal order, the Division Bench, after noting that the petitioner was dismissed from service as against which he had also filed W.P.No.27699/2004, dismissed the Writ Appeal as having become infructuous, however, with liberty to raise the grounds which have been raised in W.A.No.2642/2004 in the pending Writ Petition-W.P.No.27699/2004, wherein, the order of dismissal was under challenge. Therefore, the learned senior counsel has submitted that when the Division Bench has given him liberty to raise all the grounds which have been raised in the W.A.No.2642/2004, in W.P.No.27699/2004 challenging the order of dismissal, the petitioner is entitled to raise all the issues including the validity of the direction to hold a de novo enquiry against the petitioner. On that basis, the learned senior counsel has further argued that the entire exercise of the respondent from holding of the de novo enquiry upto the passing of the dismissal order against the petitioner, is not only unlawful and unjustified, but also a deliberated and motivated move totally contrary to the dictum laid down by the judgment of the Constitution Bench in B.KARUNAKAR CASE, followed by another judgment of the Apex Court in PUNJAB NATIONAL BANK AND OTHERS V. KUNJ BEHARI MISRA (1998)7 SCC 84. Since the respondents have failed to follow the principles of natural justice by adhering to the proper procedure as mandated by the Supreme Court in B.KARUNAKAR case in the matter of holding de novo enquiry, the entire disciplinary proceedings resulting from the de novo enquiry shall be declared to be void on the ground of gross violation of principles of natural justice. On these basis, the learned senior counsel prayed for allowing the present Writ Petition. 3 (i)Per contra, Mr.L.Swaminathan, the learned counsel appearing for the first respondent submitted that when the petitioner suffered departmental proceedings, an Enquiry Officer by name P.Elangovan, Advocate, was appointed and one Mr.K.Rajamanickam was appointed as Presenting Officer. Thereafter, the Enquiry Officer after completing the enquiry, submitted his enquiry report to the Presenting Officer without directly addressing the Disciplinary Authority. The Enquiry Officer by his letter dated 26.12.2003, informed the Disciplinary Authority marking a copy that he has also submitted an enquiry report https://hcservices.ecourts.gov.in/hcservices/ to the Presenting Officer. In view of the enquiry officer submitting his report to the Presenting Officer, instead of the disciplinary authority, the disciplinary authority ordered for a de novo enquiry on 21.1.2004. Aggrieved by the decision taken to initiate de-novo enquiry, the petitioner filed W.P.No.2394/2004. (ii) This Court, by an interim order dated 9.2.2004, directed that the enquiry may go on having suspending the result of the same till further orders. Thereafter, a second charge memo was issued to the petitioner on 18.5.2004. After that, the petitioner wrote a letter to the Disciplinary Authority informing his request to engage a defence assistance. Since there was no provision for engaging a defence assistant, the enquiry as ordered by this Court was further proceeded and subsequently, when this Court, by its order dated 28.6.2004, directed the petitioner to appear for the enquiry, again, the petitioner failed to appear. As against that, when the petitioner filed W.A.No.2642/2004, by order dated 12.7.2004, the Division Bench of this Court also directed to complete the enquiry and place the findings in a sealed cover. Only on the basis of the said direction the respondent completed the said enquiry and thereafter the sealed cover was also placed before this Court. Again this Court by order dated 3.8.2004 after noting that except charge No.9, other charges were held to have been proved, directed the respondent to issue a second show cause notice and, on receipt of the same, the writ petitioner was also directed to submit his explanation. When this matter was posted after two weeks the respondent subsequently, on completion of the formalities, passed the dismissal order. Thereafter, when the matter was listed on 27.6.2004, this Court, by taking note of the fact that the petitioner was dismissed from service and the dismissal order also has been challenged by the petitioner in W.P.No.27699/2004, by giving liberty to the petitioner to raise all the grounds raised in W.A.No.2642/2004 in the pending W.P.No.27699/2004, dismissed W.A.No.2642/2004. Therefore, the petitioner is not entitled to re-open the previous enquiry proceedings, which were concluded on 28.11.2003. (iii)The learned counsel for the respondent further contended that the petitioner, having caused heavy loss to the respondent, has deliberately abstained himself from participating in the second denovo enquiry proceedings. Only after completion of the de novo enquiry, the second Enquiry Officer found him guilty of all the charges except charge No.9 and held that the petitioner has deliberately misused the union funds. Therefore, the dismissal order cannot be found fault with. On that basis, the learned counsel for the first respondent prayed for dismissal of the writ petition as devoid of merits. 4.(i) Supporting the stand of the first respondent, Ms.N.Mala, Additional Government Pleader appearing for respondent No.2, adopted the arguments of the learned counsel appearing for the respondent https://hcservices.ecourts.gov.in/hcservices/ No.1 and reiterated that the present writ petition has no merit for consideration. (ii) In support of her submission the learned counsel further pleaded that it is an admitted case that the petitioner was directed to appear for the de novo enquiry. But, unfortunately, the petitioner did not appear for such enquiry and therefore, the Enquiry Officer, after giving all particulars, completed the enquiry finding him guilty of all the charges except charge No.9 and thereafter, when an order of dismissal was passed the petitioner kept quiet without challenging the said dismissal order for about four years. But when he challenged the dismissal order by preferring appeal before the Administrator of PONLAIT, the appellate authority, on 30.6.2010 dismissed the said appeal dated 28.10.2008. Therefore, the rejection of the appeal preferred by the petitioner is justified. 5. Considered the rival submissions as advanced on either side. 6. The petitioner was originally appointed as Dairy Assistant. After putting in 25 years of service, he was promoted to the post of Assistant General Manager. The second respondent issued a direction to the first respondent to constitute an Expert Panel as per the bye- law to select the Managing Director. Accordingly, an advertisement was given in a newspaper for the post of Managing Director on 29.10.1999. When four applications were received by the respondent including the petitioner's one, 3 out of the 4 were found ineligible in terms of the advertisement and the bye-laws. Therefore, the petitioner was the only eligible candidate. But the second respondent issued a direction to the first respondent not to consider the petitioner's application for the said post. Accepting the said recommendation, the Expert Panel adjourned the proceedings sine-die which compelled the petitioner to prefer W.P.No.18210 of 1999 against the direction issued by the said respondent. The first respondent also preferred another W.P.No.4785/1999 challenging the said direction. This Court, by clubbing both Writ Petitions together passed a common order on 5.5.2000. While W.P.No.18210/1999 filed by the petitioner was partly allowed with a direction to fill up the post of the Managing Director without any further delay, the other one viz., W.P.No.4785/1999 was dismissed. Since this Court, in the above order dated 5.5.2000, has given three months' time-limit to fill up the post of Managing Director by constituting Expert Panel to select and appoint the Managing Director according to the bye-laws read with the provisions of the Act and when the respondent failed to implement the order, the petitioner filed Contempt Petitions in Contempt Application Nos.497 and 631 of 2000. In the said Contempt Applications, this Court, by taking note of the fact that the order, dated 5.5.2000, passed in W.P.No.18210/1999 was not complied with by constituting an Expert Committee, appointed one Uddipt Ray, Joint Secretary, Government of Pondicherry, as Special Officer to exercise all the powers of the Chairman, Board of Directors and Managing https://hcservices.ecourts.gov.in/hcservices/ Director and to arrange to select and appoint the Managing Director within another four months' time. The Chairman and the Board of Directors were restrained from acting in their capacity until further orders. The order passed by this Court in the said Contempt Petitions being the root cause for these proceedings, is extracted hereunder: (i) The petitioner, Managing Director in-charge shall keep himself away from the activities of the Pondicherry Cooperative Milk Producers' Union in any capacity by proceeding on leave until further orders and shall not in any manner interfere whatsoever with the affairs of the Union or the management of the union by the Administrator appointed by this Court. However, full salary alone shall be paid to him in the substantive post until further orders without any other benefit or facility. (ii) The Chairman of the Pondicherry Co-operative Milk Producers' Union and the newly elected Chairman or Board of Directors if any, shall also not act in their respective capacity until further orders of this Court and the Administrator appointed by this court shall act in the place of the Board or Committee or Committees as well as the Managing Director to manage the affairs of the Society and exercise full control, supervision over the affairs of the Pondicherry Cooperative Milk Producers' Union until further orders and the Administrator take all such actions as may be required in the interest of the Society. (iii) The Chief Secretary to the Government of Union Territory of Pondicherry is suo-motu impleaded as party to the present writ proceedings. (iv) Mr.Uddipt Ray, I.A.S., Joint Secretary (Revenue) in the services of the Union Territory of Pondicherry is appointed as the Administrator to manage and administer, control and supervise every affairs of the Union and also exercise all the powers of the Chairman, Board of Directors and Managing Director of the said Union or Committee or Committees or of the Cooperative Union and shall be the sole repository exercising powers until further orders. (v) The administrator shall initiate immediate action to fill up the post of Managing Director by inviting fresh applications in terms and as per the byelaws that existed as on 5.5.2000. (vi) On the communication received from the said Administrator appointed by this court, the National Dairy Development Board, the Government of Pondicherry shall in the level as prescribed in the byelaws nominate their representatives respectively to be the Committee members and https://hcservices.ecourts.gov.in/hcservices/ select the Managing Director of the Pondicherry Cooperative Milk Producers' Union without delay and take all steps to fill up the said post. (vii) The Administrator shall be one of selection the committee members as representing the said Cooperative Milk Producers' Union as its Chairman or Committee and the Administrator shall be the Co-ordinator and the representative of the National Dairy Development Corporation shall be the Chairman of the Selection Committee. The majority decision of the selection committee shall be final and on the majority decision the candidate selected shall be appointed as Managing Director by the Administrator and the said appointment shall be deemed to have been made as per byelaws and the same will be treated as per statutory provisions of the Pondicherry Cooperative Societies Act, 1972 and thereafter the Administrator shall hand over