IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA CWP (T) No.9979 of 2008 Date of decision : August 10, 2011 Mohinder Singh Guleri …Petitioner. Versus The Kangra Central Cooperative Bank …Respondent. Coram The Hon’ble Mr. Justice Surjit Singh, Judge. Whether approved for reporting?1 Yes. For the Petitioner : Mr. Ranjan Sharma, Advocate. For the Respondent : Mr. J.L. Bhardwaj, Advocate. Surjit Singh, Judge(Oral) Petitioner was appointed as Clerk on the establishment of Kangra Central Cooperative Bank, respondent herein, in the year 1971. In the year 1985, petitioner was promoted as Branch Manager. Thereafter, he was charge-sheeted for some acts of serious misconduct, in respect of which major penalty could have been imposed. He was found guilty of those acts of misconduct, during the course of regular enquiry and was visited with the penalties of (a) reversion from the post of Branch Manager to that of Cashier; (b) reversion to lower grade of pay; (c) downgrading of seniority; and (d) forfeiture of service already rendered. This order of penalty was passed on 10th October, 1988, vide Annexure A-1. Petitioner retired in the year 1997. So long as he Whether reporters of the local papers may be allowed to see the judgment? …2… had been in service, he did not challenge the aforesaid order, copy Annexure A-1. It was in the year 2003 that he filed an Original Application before the erstwhile H.P. State Administrative Tribunal, challenging the legality of order Annexure A-1, on the grounds that under Rule 55(a) of the Kangra Central Cooperative Bank Employees (Terms of Employment and Working Conditions) Rules, 1980, applicable to the Staff and Officers of the respondent-bank, some of the penalties imposed vide Annexure A-1 were not prescribed and, hence, such penalties could not have been imposed. The penalties, which are alleged to be not prescribed by the Rules, are downgrading of seniority and forfeiture of service. On the abolition of the H.P. State Administrative Tribunal, the matter has come to this Court. 2. Respondent-bank, in its reply, has taken the plea that the petition is hopelessly barred by time. Also, it is alleged that the respondent-bank is not an instrumentality of the State and, hence, this Court cannot grant any relief to the petitioner, by pressing into service Article 226 of the Constitution of India. 3. I have heard learned counsel for the parties and gone through the record. 4. As regards objection that the respondent-bank is not an instrumentality of the State, it is true that the Hon’ble Supreme Court in S.S. Rana versus Registrar, …3… Coop. Societies and another, (2006) 11 SCC 634, has held that the respondent-bank is not an instrumentality of the State, but it was held so, for the reason that material on the record of that case did not show that the State had more than 50 per cent of the capital share in the bank. However, a Bench of this Court in Kuldeep Singh and others versus State of H.P. and others, 2011(2) Him L.R. 899, held that the material placed on record of that case established that the State had about 60 per cent share in the capital of the bank and, hence, it (respondent-bank) is an instrumentality of the State. 5. Supreme Court’s judgment in S.S. Rana’s case (supra), saying that the respondent-bank is not an instrumentality of the State, was rendered, on account of lack of material on record, indicating that the bank was owned/controlled by the State, because of latter’s share in capital being more than 50 per cent. Had any material been there, on the record of the case, before the Hon’ble Supreme Court, suggesting that the State had more than 50 per cent share in the capital of the bank, the aforesaid finding could not have been there. In the case that was dealt with by this Court, i.e. Kuldeep Singh’s case (supra), material was placed on record, showing that the State had about 50 per cent share in the capital of the bank and it was held that the respondent-bank is an …4… instrumentality of the State, despite the aforesaid judgment of the Hon’ble Supreme Court. 6. As regards the objection that the petition is hopelessly bared by time, suffice to say is that the petitioner has a continuing cause of action, because the penalty of forfeiture of service has brought down the length of service to a level that the petitioner has not been granted any pension or other retiral benefits, to which he would have been entitled, but for the penalty of forfeiture of service. If the penalty of forfeiture of service is held to be illegal, being not one of the penalties prescribed in the Service Condition Rules, forfeited service shall be added to the qualifying service of the petitioner and that will make him entitled to pension and the right to pension being a continuing right, so long as the petitioner is alive, question of limitation or latches does not arise. 7. Penalties, which can be imposed upon the employees of the respondent-bank, for an act of misconduct, rendering the employee liable for major penalties, are prescribed in Rule 55(a) of the Kangra Central Cooperative Bank Employees (Terms of Employment and Working Conditions) Rules, 1980. Following penalties are prescribed in the said Rule, for a person found guilty of major misconduct: …5… “i) Withholding of annual increments with or without commutative effects. ii) Barring of promotion to the higher grade for the specific period. iii) Reversion to next lower grade/post. iv) Termination or discharge. v) Dismissal.” 8. Admittedly, the petitioner was held guilty of major misconduct and that is why one of the penalties he was visited with was reversion from the post of Branch Manager to that of the Cashier. The Rule does not provide for downgrading of seniority and forfeiture of service. Therefore, these two penalties, imposed by the respondent-bank, are illegal; rather without jurisdiction and as such nonest. They are required to be ignored. If the penalty of forfeiture of service is ignored, the petitioner is to be deemed to have rendered service to the respondent-bank from the year 1971 to the date of his superannuation, in the year 1997 and that will entitle him to pensionary and other retiral benefits. 9. It has also been pointed out by the learned counsel for the petitioner that the petitioner was drawing salary of `1430/-, at the time when the impugned order of penalty Annexure A-1 was passed. According to him, maximum pay in the pay-scale of the post of Cashier was `1420/- and, therefore, petitioner’s pay, on reversion to the post of Cashier, should have been fixed at least at …6… `1420/-, but the respondent-bank fixed it at `760/-, i.e. the minimum pay in the pay-scale of the post of Cashier. This order of reducing the pay of the petitioner to a level below the maximum of the pay of the Cashier, which was lower than the pay, which the petitioner was drawing as Branch Manager, is illegal, because the above re- produced Rule does not provide for imposition of penalty of reduction in pay, though it does provide for reversion to next lower grade/post. Consequently, action of the respondent-bank, in fixing the pay of the petitioner at the minimum of the pay-scale of the post of Cashier, i.e. at `760/- is also illegal and without jurisdiction. Petitioner’s pay was required to be fixed at `1420/-, the maximum of the pay-scale of the post of Cashier. 10. In view of the abovestated position, penalties of forfeiture of service and downgrading of seniority, as imposed vide Annexure A-1, are quashed and set aside. Also, action of the respondent-bank, in reducing the pay of the petitioner to `760/-, the minimum of the pay-scale of the post of Cashier, is quashed. The respondent-bank is directed to fix the pay of the petitioner at `1420/-, which is the maximum of the pay-scale of the post of Cashier, because at the time of his reversion, he was drawing pay at the rate of `1430/-. However, the petitioner shall not be entitled to any arrears, as his claim for arrears of salary was barred by time, when the …7… petition was filed. He retired in the year 1997 and the petition was filed in the year 2003. He shall be sanctioned pension and given other retiral benefits, to which he may be entitled as per Kangra Central Cooperative Bank Employees (Terms of Employment and Working Conditions) Rules, 1980, by being treated in service of the respondent-bank from the year 1971, when he joined as Clerk, upto to his superannuation in the year 1997. He shall also be paid arrears of pension from three years to be counted backward from the date of the institution of the petition, which is 26th February, 2003, to this day and monthly pension from this day onward. Petition stands disposed of. Pending application(s), if any, also stand disposed of. August 10, 2011(sd) ( Surjit Singh ), J