Kottappady Service Co operative Bank v. Kerala Co operative Tribunal
2014-11-12
A.V.RAMAKRISHNA PILLAI
body2014
DigiLaw.ai
JUDGMENT : 1. A Service Co-operative Bank and its Board of Directors are before this Court with a prayer to quash Ext.P12 award passed by the third respondent and Ext.P15 judgment passed by the Kerala Co-operative Tribunal, Thiruvananthapuram in Appeal No.6/2011 confirming Ext.P12. 2. The second respondent was working in-charge of the Manager of the Panipra Branch of the Kottappady Service Co-operative Bank Ltd. She was dismissed from the service of the bank for serious charges of misappropriation, forgery, misconduct and manipulation of Books and Accounts. The disciplinary proceedings were initiated as provided under Rule 198 of the Co-operative Societies Act and Rules which ended in the dismissal. The appeal filed before the Board of Directors was dismissed and the matter was challenged before the 4th respondent under Rule 176, who allowed the petition. This was challenged before the Government by the bank, but without success. 3. The bank approached this Court with WPC No.29734/2007 which was disposed of by Ext.P10 judgment directing the 4th respondent to forward Ext.P3 in this writ petition to the appropriate Arbitration Court which treated it as an application for the purpose of commencement of the proceedings in terms of Section 69 of the Act. 4. The petitioners have a case that the third respondent has not commenced the proceedings-stipulated under Section 69 and corresponding rules and erroneously continued the proceedings. However, the third respondent heard the matter and disposed of the same by accepting the contentions of the second respondent and ordered reinstatement in service with back wages and all service benefits as per Ext.P12. 5. Aggrieved by Ext.P12, the petitioners filed a statutory appeal before the first respondent Tribunal under Section 82(1) of the Act. The Tribunal, after hearing the interlocutory application, passed a detailed order by which Ext.P12 order was stayed till the disposal of the appeal. Thereafter the first respondent, after hearing the parties, dismissed the appeal confirming Ext.P12 award. Though Ext.P15 was received by the petitioners on 27.4.2012, in the interregnum, the secretary of the bank retired and a new secretary has taken charge. According to the petitioners, he was not familiar with the matter and therefore, he took some time to compile all the papers to get ready to file this writ petition before this Court, since the records are voluminous. Hence, the writ petition could not be filed during the third week of July 2012 only.
According to the petitioners, he was not familiar with the matter and therefore, he took some time to compile all the papers to get ready to file this writ petition before this Court, since the records are voluminous. Hence, the writ petition could not be filed during the third week of July 2012 only. The decision to challenge Ext.P15 was also taken by the second petitioner in the meantime. 6. In a detailed counter affidavit filed by the second respondent, she justified the impugned order. She contended as follows: It was submitted that she was dismissed as per Ext.P1 and that the dismissal was confirmed in Ext.P2. But the averment that the dismissal was ordered after a proper domestic enquiry is incorrect. The enquiry report, Ext.P26, was rendered by a biased enquiry officer in violation of all principles of natural justice as was rightly held in Ext.P6 by the 4th respondent in Ext.P9 by the Government and in Ext.P12 and P15 respectively by respondents 3 and 1. The averment that Exts.P6 and P9 were passed without proper consideration is incorrect. Ext.P6 was passed after due consideration of all relevant materials including Exts.P3 to P5. Ext.P9 was also passed by the Government after proper consideration of all relevant materials. The contention that Ext.P3 was wrongly entertained by the 4th respondent was not raised before respondents 3 and 1 in Exts.P4, P5 and P11. Ext.P3 was rightly entertained by the third respondent as it was done in obedience to the direction in Ext.P10 judgment of this Court. The required fees was also remitted. If at all there is any delay in payment of fees, it is not an incurable defect as held by this Court in Narayanan Nair v. Co-operative Tribunal ( 1998 (2) KLT 596 ). The contention in this regard is liable to be rejected. The second respondent did not commit any misconduct attributed to the second respondent in Ext.P24 charge sheet. The findings rendered in Ext.P26 enquiry report are perverse and unsustainable. The award Ext.P12 was properly made and the challenge against it is baseless. The second respondent had 22 years of blemishless service under the petitioners, when the second respondent was suspended pending disciplinary proceedings culminating in Ext.P1 dismissal.
The findings rendered in Ext.P26 enquiry report are perverse and unsustainable. The award Ext.P12 was properly made and the challenge against it is baseless. The second respondent had 22 years of blemishless service under the petitioners, when the second respondent was suspended pending disciplinary proceedings culminating in Ext.P1 dismissal. The second respondent’s history is as under: Joined service as a Junior Clerk on : 22.9.1981 Promoted Senior Clerk : 1.9.1983 Promoted as Accountant : 1.7.1995 Promoted as Chief Accountant : 1.2.1997 It is true that Ext.P13 appeal filed by the petitioners before the 1st respondent and Ext.P14 order staying operation of Ext.P12 were passed as stated in paragraph 4 of the writ petition. Ext.P14 has no relevance in the light of Ext.P15. Ext.P15 was passed as stated in paragraph 5 of the writ petition. That order is correct and sustainable; it is contended. Averments in paragraph 6 of the writ petition are not disputed. There was no need to initiate disciplinary proceedings against the second respondent for misappropriation of funds during 2000-2002. The second respondent joined the Panipra branch only on 1.8.2000. The second respondent detected certain irregularities in that branch and as a result, the second respondent made reports dated 12.8.2002 and 19.9.2002 to the petitioners regarding those irregularities. Those reports are Exts.P20 and P21 respectively. They were admitted in Ext.P12 case in evidence as Exts.A1 and A2 respectively. Instead of proceedings against persons responsible for the irregularities, the 1st respondent placed the second respondent also under suspension along with Sajith Kumar, the head clerk and three others. Disciplinary proceedings were also initiated against them. The second respondent submitted convincing explanations against the charge pleading not guilty to the same. Rejecting the explanations without just cause, the first respondent ordered domestic enquiry through Advocate Sri. Paul Varghese. The enquiry officer submitted his report dated 25.2.2003 which was produced and marked in reference in Exts.P12 and Ext.A3. In that report, it was found that Sri. Sajith Kumar and others committed misappropriation and they are liable for the misconducts attributed to them. It was found therein that he was also partly responsible as he did not exercise his supervisory power to the extent to which it was expected. Based on that report, Sajithkumar was dismissed. The second respondent and others were reinstated in service.
Sajith Kumar and others committed misappropriation and they are liable for the misconducts attributed to them. It was found therein that he was also partly responsible as he did not exercise his supervisory power to the extent to which it was expected. Based on that report, Sajithkumar was dismissed. The second respondent and others were reinstated in service. The co-operative Department conducted an enquiry under Section 65 of the Co-operative Societies Act to the irregularities said to have been done in the first petitioner bank and filed a report, portions of which alone are produced as Ext.P16. The second respondent is not having a copy of the full text of that report. It was prayed that the petitioner be directed to produce a copy of the full text of the report of which Ext.P16 is a part. It is reported towards the end of Ext.P16 that the Secretary, Director Board members of the bank and some of its employees are liable to be proceeded for recovery of the loss sustained by the bank. It is also mentioned in the report that the second respondent’s report Exts.P20 and P21 brought to light the irregularities. The first petitioner bank, instead of adopting the recommendations in Ext.P16, insisted on recovery of the amount from the second respondent also. They also wanted the second respondent to withdraw the reports Exts.P20 and P21 earlier made by the second respondent. The second respondent did not oblige as a result the Secretary and the members of the Director Board of the bank initiated fresh disciplinary proceedings against the second respondent on fabricated complaints resulting in Ext.P26 report and Ext.P1 dismissal. The averment that Ext.P16 covers the issue involved and therefore, respondents 1 and 3 should have upheld the second respondent’s dismissal is incorrect and unsustainable. Ext.P17 complaint was raised without any basis at the instance of the Secretary and members of the Director Board held responsible in Ext.P16 for the irregularities and misappropriation in an attempt to escape from their liabilities. The disciplinary proceedings initiated against the second respondent was only to victimize the second respondent. Ext.P1 dismissal order is illegal and unsustainable. It was set aside in Exts.P12 and P15 on valid grounds. It is true that Ext.P18, ARC No.202/2006, was filed by the first petitioner before the Asst.
The disciplinary proceedings initiated against the second respondent was only to victimize the second respondent. Ext.P1 dismissal order is illegal and unsustainable. It was set aside in Exts.P12 and P15 on valid grounds. It is true that Ext.P18, ARC No.202/2006, was filed by the first petitioner before the Asst. Registrar of Co-operative Societies, Kothamangalam and that Ext.P19 written statement was filed by the second respondent in that case. Ext.P18 is filed on the basis of Ext.P16 report. Ext.P16 did not say that the second respondent has misappropriated the bank funds. The only adverse finding against the second respondent is that the second respondent failed to properly supervise the affairs in the bank. The second respondent’s duty to supervise the affairs of Panipra Branch arose only from 1.8.2000 on which date only the second respondent took charge of that branch. Ext.P16 report mainly relates to the periods prior to that date. Ext.P16 categorically found that the secretary and the members of the Director Board of the bank are responsible for the misappropriation. When that is so, the bank should have proceeded against those persons and Sajith Kumar only. The real culprits were excluded from Ext.P18 without any reason. It is true that Ext.P18 is pending, but those who are responsible have remitted the entire liability to the bank and no purpose is likely to be served in continuing that case. The second respondent submitted W.P.(C) No.14654/2012 before this Court for a direction to the Assistant Registrar dealing with Ext.P18 case to dispose of the same at an early date. This Court by judgment dated 5.7.2012 directed the Assistant Registrar to dispose of Ext.P18 case within three months from the date of the judgment. True copy of that judgment is produced and marked as Ext.R2 (A). Notice of Ext.P18 case was served on the second respondent only in December 2011. The second respondent submitted Ext.P19 written statement soon thereafter. The contention that the issues involved is covered by Ext.P16 is not correct. As a matter of fact the Secretary and Director Board members of the bank challenged Ext.P16 before this Court in W.P.(C) No.16069 of 2005 and obtained a stay of further proceedings on the basis of Ext.P16. During the pendency of the case, the amounts due to the bank were realised from those responsible and so, W.P.(C) No.16069 of 2005 was dismissed by this Court as per judgment dated 16.1.2009.
During the pendency of the case, the amounts due to the bank were realised from those responsible and so, W.P.(C) No.16069 of 2005 was dismissed by this Court as per judgment dated 16.1.2009. True copy is produced and marked as Ext.R2(B). The Joint Registrar of Co-operative societies, Ernakulam as per order dated 18.1.2010, true copy of which is produced and marked as Ext.R2(C) closed further proceedings under Section 68 of the Act on the basis of Ext.P16. In the above circumstances, the plea that the second respondent is guilty of misappropriation on the strength of Ext.P16 is incorrect and unsustainable; it is contended. The second respondent also contended that the averments in paragraph 12 of the writ petition are incorrect. Exts.P22 and P23 were not produced before the enquiry officer who gave Ext.P26 report. Sri. Binu, the complainant in Ext.P17 was also not examined before the enquiry officer. Exts.P22.and P23 series are not covered in Ext.P24 charge. When that is the position, the petitioners have no right to rely on Exts.P22 and P23 in support of their plea that the second respondent is guilty of the charges attributed to the second respondent in Ext.P24. Exts.P20 and P21 are reports made by the second respondent in the ordinary course of the second respondent’s official duty and the allegation that the second respondent gave those reports is an attempt to wash the second respondent’s hands from the sins of mischief is incorrect. The second respondent has not committed any sins or mischief. It is evident from Ext.P16 that misappropriations took place in the branch during the periods when the second respondent was on leave. That is sufficient circumstance to find that the second respondent is innocent of the allegations against the second respondent. They also contended that the averments in paragraph 13 of the writ petition are not fully correct. Exts.P24 charge was answered in Ext.P25 explanation. The second respondent did not admit in Ext.P25 as stated in paragraph 13. The second respondent’s convincing explanations were rejected and a biased enquiry officer was appointed to conduct an enquiry. The second respondent’s request to substitute the enquiry officer was rejected. The report Ext.P26 is made in violation of all the principles of natural justice by a biased enquiry officer. The reasons stated in Ext.P28 for the refusal to reinstate the second respondent are not correct.
The second respondent’s request to substitute the enquiry officer was rejected. The report Ext.P26 is made in violation of all the principles of natural justice by a biased enquiry officer. The reasons stated in Ext.P28 for the refusal to reinstate the second respondent are not correct. All the authorities have found that the second respondent is not guilty of the charges raised against the second respondent. Exts.P12 and P15 which are validly made and legally sustainable, have granted relief of reinstatement to the second respondent with backwages. The second respondent was placed under suspension from 14.10.2003 even without payment of subsistence allowance. The petitioners are liable to be directed to pay the second respondent the subsistence allowance till the date of the writ petition and wages thereafter during the pendency of the writ petition. The second respondent was not employed elsewhere from the date of the second respondent’s suspension and the second respondent is depending on the meagre pension received by the second respondent’s husband. The petitioners were protracting the trial and disposal of ARC No.86/2008 by seeking adjournments after adjournments at the Emakulam camp sitting of the third respondent. On the second respondent’s representation, the case was posted to Trivandrum to a specific date so as to enable disposal of the same at an early date. Ext.P29 case was filed by the petitioners before this Court in this background. 7. The petitioners have filed a reply affidavit to the counter affidavit. 8. I have heard the learned senior counsel for the petitioners, the learned senior counsel for the second respondent and the learned Government Pleader in the matter. 9. The learned senior counsel for the petitioners gave a brief description of the circumstances under which the second respondent was dismissed from service as per Ext.P1 order, while she was working as the Chief Accountant and in charge of the Manager of the Panipra branch of the bank. It was pointed out that she was working as Chief Accountant of the bank for a quite long period and when the new branch at Panipra branch was started, she was put in charge including supervisory, making accountable for all transactions of new branch at Panipra. This was taking into account of her experience in banking operations. Along with her, Mr.
This was taking into account of her experience in banking operations. Along with her, Mr. Sajithkunriar was the head clerk and T.N. Narayanan Kartha, Attender were also posted to the said branch from the very date of commencement of the business at new branch i.e. 1.8.2000 till she was suspended from service on 26.11.2002. The learned senior counsel would point out that the petitioners were compelled to initiate proceedings against the second respondent, when it was detected large scale misappropriation of funds during 2000-2002. Manipulation and falsification of accounts, forgery and other illegal methods were adopted for misappropriation. The responsible employees including the 2nd respondent were subjected to domestic enquiry and all of them were punished proportionately, according to their roles. The second respondent was also punished with a lenient view by an order dated 21.4.2003 vide Rule 198(l)(e) of the Rules and by which recovery was ordered from her salary at the rate of Rs.500/- per month till the loss is recovered. Even though an appeal was filed by her, the same was rejected by order dated 7.8.2003. Sajith Kumar, the Head Clerk was also punished and dismissed from service. At this time, Section 65 enquiry was not contemplated and some of the findings and charges of the 4th respondent could not be included in the earlier enquiry. While so, the second petitioner received a complaint from K.V. Binu, a member, suspecting manipulation and falsification of his account at Panipra Branch. He had also raised suspicion about the functioning of the 2nd respondent. The second respondent, pending enquiry of the complaint was suspended from service with effect from 14.10.2003. A sub committee was constituted to take up the issue and to act accordingly. In the meanwhile, the Joint Registrar ordered an enquiry under Section 65 of the Act and appointed the Assistant Registrar (General) Kothamangalam as Enquiry Officer. Thereafter the former invoked section 32 and the then Board was removed and replaced by an administrator. Later, an administrative committee was appointed. The said administrative committee decided to proceed with the disciplinary action against the second respondent initiated by the earlier committee which was superceded. Meanwhile, the report under Section 65 came out which revealed that a large scale misappropriation has taken place to the tune of Rs.39.36 lakhs in which the liability of the second respondent was fixed as Rs.15,77,240/-.
The said administrative committee decided to proceed with the disciplinary action against the second respondent initiated by the earlier committee which was superceded. Meanwhile, the report under Section 65 came out which revealed that a large scale misappropriation has taken place to the tune of Rs.39.36 lakhs in which the liability of the second respondent was fixed as Rs.15,77,240/-. In the same report, the liability of the above said Sajithkumar was fixed as Rs.21,38,472/-. The abstract of the report was placed before the Arbitrator and it was marked as Ext.B21 in the award. A true copy of Section 65 enquiry report dated 14.8.2003 is produced along with the deposition of the 2nd respondent during the said enquiry and the same is marked as Ext.P16. The abstract of the report which is marked as Ext.B21 in the award forms part of Ext.P16. The deposition attached to Section 65 enquiry report would reveal that there exists a gross negligence, dereliction of duty and serious lapse in exercising supervisory function as Branch Manager; it was pointed out by the learned senior counsel for the petitioner. It was further submitted that Ext.P16 is clinching and conclusive regarding the nature of the case and the courts below should have considered this matter in proper perspective while deciding the issue. 10. It was argued that the Arbitration Court did not consider the document and a specific ground was also raised before the Tribunal in paragraph U of the grounds. It was also argued that the aforesaid section 65 enquiry report has become final and therefore, it is a document which further fortifies that the delinquent is guilty of the charges levelled against her. In that respect also, the finding of the Tribunal requires re-consideration; so submitted the learned senior counsel for the petitioner. 11. It is relevant to note that Ext.P16 covers the issue contained in the earlier disciplinary proceedings as well. A fresh complaint said to have been received from Binu is produced and marked as Ext.P17. The petitioners allege that based on Exts.P16 and P17, an enquiry was conducted by the sub committee which revealed more misappropriation other than which were the subject matter of the earlier enquiry. It was in this context, the petitioner was suspended on 14.10.2003 and disciplinary proceedings initiated against her which culminated in the dismissal of her by Ext.P1 order. 12.
The petitioners allege that based on Exts.P16 and P17, an enquiry was conducted by the sub committee which revealed more misappropriation other than which were the subject matter of the earlier enquiry. It was in this context, the petitioner was suspended on 14.10.2003 and disciplinary proceedings initiated against her which culminated in the dismissal of her by Ext.P1 order. 12. It was further pointed out by the learned senior counsel for the petitioners, in the aforesaid circumstances, the petitioner bank initiated steps to recover the lost amount found in Section 65 enquiry report by filing arbitration case, viz. ARC No.202 of 2006 for the recovery of an amount of 60,62,054/-from Sajithkumar and the 2nd respondent. Ext.P8 is the copy of the ARC. According to the petitioners, Ext.P18 is pending disposal before the arbitrator. The second respondent filed a written statement to the above ARC in which she has stated that the bank received the money alleged to have been lost and consequently, the 4th respondent has concluded the proceedings under Section 68. The copy of the written statement dated 12.1.2012 is produced and marked as Ext.P19. It was pointed out that this statement will not absolve the second respondent from the liability and will not save her from the charge of misappropriation of accounts and forgery. It was pointed out that she has no case that she has cleared the liability from her pocket. Ext.P19 statement has been made on 12.1.2012, i.e. after the passing of Ext.P12 award by the third respondent. Ext.P18 was filed on 17.11.2006. It contains the amount pertaining to the entire period during which the 2nd respondent was in charge of the Panipra branch, i.e. from 1.8.2000 to 26.11.2002. 13. As already pointed out, Ext.P18 is filed on the basis of Ext.P16 report under Section 65 of the Act which covers the issue contained in both the disciplinary actions and also the issues involved in Ext.P17 complaint of Binu. However, the recovery under Rule 198(l)(e) on the basis of earlier disciplinary action could not be continued as the second respondent was again suspended, as stated above on 14.10.2003. Therefore, the balance of the liability fixed in the earlier disciplinary action also was included in Ext.P18 ARC proceedings. The petitioners further pointed out that only after indulging in all these misconduct, she addressed to the secretary of the bank to take action.
Therefore, the balance of the liability fixed in the earlier disciplinary action also was included in Ext.P18 ARC proceedings. The petitioners further pointed out that only after indulging in all these misconduct, she addressed to the secretary of the bank to take action. True copy of the said reports are marked as Exts.P20 and P21. This, according to the petitioners, was a clear attempt to wash her hands from the sins of mischief which were done under the nose with her connivance. It was pointed out that altogether 102 items of documents spreading from 2.8.2000 to 29.8.2002 found to have forged in different accounts without the signatures of the account holders resulting in large misappropriation. True copies of the list of documents are produced and marked as Ext.P22. True copies of some of the instruments showing the above malpractice are produced and marked as Ext.P23 series. The petitioners allege that the second respondent has passed all these instruments for payment assigning her signature in the capacity of Branch Manager. Therefore, it was pointed out that only after becoming a party to the above acts, she has written Exts.P20 and P29 to hide herself and to escape from the responsibility. It was pointed out by the learned senior counsel for the petitioner that it is in the above background that the petitioners, after a preliminary enquiry, framed charges against the second respondent and the statement of allegations with memo of charges was issued on 6.5.2004. Ext.P24 is the statement of allegations. The second respondent submitted a final reply on 31.5.2004 as evidenced by Ext.P25. As Ext.P25 was found to be unsatisfactory, the petitioners appointed an enquiry officer to conduct the enquiry. The enquiry officer after enquiry filed Ext.P26. Subsequent to Ext.P15 judgment, the second respondent filed a petition before the 4th respondent to direct the petitioners to implement the same and to reinstate her with back wages. Accordingly, the Assistant Registrar sent a letter dated 26.5.2012 to the petitioners to which the petitioners have sent a reply dated 5.7.2012 as evidenced by Ext.P28. The learned senior counsel for the petitioners would argue that Exts.P12 and P15 are unsustainable on facts and law. 14. The first question that has to be considered is as to whether the termination is vitiated by irregularity, impropriety or illegality, as pointed out in Ext.P15.
The learned senior counsel for the petitioners would argue that Exts.P12 and P15 are unsustainable on facts and law. 14. The first question that has to be considered is as to whether the termination is vitiated by irregularity, impropriety or illegality, as pointed out in Ext.P15. The Arbitration Court relying on the testimony of PW1, who was the secretary of the appellant bank, found that Adv. Sri. S. Chandran, who was the enquiry officer in the enquiry against the second respondent has appeared for the petitioner before the Joint Registrar in the petition filed under 176 of the Rules challenging her dismissal which was on the basis of the first report and she challenged the order therein before the Government preferring an appeal. The Arbitration Court, based on judicial pronouncement of this Court, found that the enquiry officer was biased. This was accepted by the learned Tribunal also. The Arbitration Court as well as the learned Tribunal came to the aforesaid conclusion on the basis of the enquiry report submitted by the Advocate Commissioner which was marked as Ext.B21 in the arbitration case. 15. Yet another reason pointed out by the Arbitration Court to enter into a finding that the enquiry was vitiated was that the copy of the relevant documents asked for by the respondents were not furnished and it has caused prejudice to the second respondent. The Arbitration Tribunal, after going through the entire proceedings, found that the complaint of the second respondent regarding non-receipt of the copy of the documents is true and the same has caused serious prejudice to her. I see no reason to upset the said finding of fact entered into by the learned Tribunal. 16. The learned Tribunal has rightly pointed out that though the disciplinary proceedings initiated against the employees of the Co-operative Societies are not governed by any specific Rules, Regulations or statutory provisions, the obligation in the matter of such enquiries to observe the principles of natural justice is a must in the light of the decision of the Apex Court reported in (State Bank of Patiala and others v. S.K. Sharma) AIR 1996 SC 1669 . 17.
17. Though the Arbitration Court found that the enquiry was vitiated due to non-payment of subsistence allowance to the second respondent, the same was negatived by the learned Tribunal on the ground that the second respondent had no case that the non-payment of subsistence allowance has prejudicially affected the proper defence of the charges. 18. There was yet another finding by the Arbitration Court that the non-examination of the enquiry officer by the petitioners are fatal to their case. This finding also was negatived by the learned Appellate Tribunal as it was the burden of the second respondent to summon the enquiry officer and to examine him. 19. Yet another reason found by the Arbitration Court was that the enquiry officer has not permitted the second respondent to file a representation through a union representative. However, the learned Tribunal found that it was not at all possible to take that there was a refusal of permission to represent the second respondent and it has caused prejudice to her. The learned Tribunal, after correctly appreciating the evidence in the enquiry has found that the finding of the enquiry officer that the petitioners herein have succeeded in establishing the charge levelled against the second respondent as per the charge memo dated 8.5.2004 was perverse in the sense that it was unsupported by the evidence on record. It was after re-appreciating the evidence, the learned Tribunal has entered into a finding and this court finds no reason to anull the same. However, the learned Tribunal refused to interfere with the decision of the arbitrator directing the petitioners to reinstate the second respondent in service along with her back wages. 20. Now, the remaining question that has to be answered is whether the learned Tribunal was justified in ordering reinstatement of the second respondent. 21. The question regarding the legality of the order of reinstatement has to be considered in the light of the propositions laid down by this Court as well as the Apex Court as to whether the case of the employees falls within the exceptions laid down by the courts to the general rule that the contract of personal service is not specifically enforcible. 22. Here, admittedly, the second respondent was under the service of the petitioner bank. 23.
22. Here, admittedly, the second respondent was under the service of the petitioner bank. 23. The argument advanced by the learned senior counsel for the petitioners is that the learned Tribunal misdirected itself, as if it was a court established under the Industrial Disputes Act. It is well settled that the Co-operative Societies Act and Rules never intended to follow the procedure of a court constituted under the I.D. Act. The Co-operative Societies Act and Rules provide that the Co-operative Arbitration Courts have the same powers as are vested in a civil court under the Code of Civil Procedure in the matters specified in the Act. The second respondent was not an employee who can be categorised as a workman under the I.D. Act. Therefore, the observation contained in paragraph 21 of the impugned judgment indicating an analogy drawn to that of an industrial dispute is totally out of place and erroneous. 24. As the second respondent was working in the supervisory category, she cannot be considered to be a workman akin to the Industrial Disputes Act. In such circumstances, the Co-operative Arbitration Court cannot act as a Labour Court. In such case, the statute also does not contemplate to adopt such a procedure. 25. This court in Trivandrum Co-op. Urban Bank Ltd. v. Joint Registrar of Co-operative societies ( 2001 (1) KLT 99 ) has observed that the jurisdiction of the Registrar under Section 69 of the Act is co-terminus with that of the civil court. Therefore, the question that looms large for consideration is that whether the contract of service of the second respondent could be specifically enforced against the petitioner bank. 26. The question whether a contract of personal service can ordinarily be enforced by a civil court has come up before the consideration of the Apex Court in so many cases. In S.R. Tewari v. The District Board Agra ( AIR 1964 SC 1680 ), the Apex Court observed as follows: “Under the common law, the court will not ordinarily force an employer to retain the services of an employee whom he no longer wishes to employ. But this rule is subject to certain well-recognized exceptions.
In S.R. Tewari v. The District Board Agra ( AIR 1964 SC 1680 ), the Apex Court observed as follows: “Under the common law, the court will not ordinarily force an employer to retain the services of an employee whom he no longer wishes to employ. But this rule is subject to certain well-recognized exceptions. It is open to the courts in an appropriate case to declare that a public servant who is dismissed from service in contravention of Article 311 continues to remain in service, even though by so doing the State is in effect forced to continue to employ the servant whom it does not desire to employ. Similarly under the industrial law, jurisdiction of the labour and industrial tribunals to compel the employer to employ a worker, whom he does not desire to employ, is recognized. The courts are also invested with the power to declare invalid with the power to declare invalid the act of a statutory body, if by doing the act the body has acted in breach of a mandatory obligation imposed by statute, even if by making the declaration the body is compelled to do something which it does not desire to do”. 27. In Executive Committee of U.P. State Warehousing corporation Ltd.v.Chandra Kiran Tyagi ( AIR 1970 SC 1244 ), the Apex Court observed that the position in law is that nodeclaration to enforce a contract of personal service would be normally granted, though there are certain well recognised exceptions to the said rules. The exceptions pointed out are (1) A public servant who has been dismissed from service in contravention of Article 311 of the constitution. (2) The employee who is dismissed is a workman under the industrial law. (3) A statutory body when it has acted in breach of a mandatory obligation imposed by a statute. 28. In Indian Airlines Corporation v Sukhdeo Rai ( AIR 1971 SC 1828 ), it was observed by the Apex Court as follows: “It is a well settled principle that when there is a purported termination of a contract of service, a declaration, that the contract of service still subsisted, would not be made in the absence of special circumstances because of the principle that courts do not ordinarily grant specific performance of service. This is so, even in cases where the authority appoint an employee was acting in exercise of statutory authority.
This is so, even in cases where the authority appoint an employee was acting in exercise of statutory authority. The relationship between the person appointed and the employer would in such cases be contractual, i.e. as between a master and servant, and the termination of that relationship would not entitle the servant to a declaration that his employment had not been validly determined”. 29. The matter was exhaustively reviewed by the Apex Court in Sirsi Municipality v. Cegelia Kom Francis Tellis ( AIR 1973 SC 855 ), wherein the Apex Court has observed as under: “The cases of dismissal of a servant fall under three broad heads, purely by contract of employment. Any breach of contract in such a case is enforced by a suit for wrongful dismissal and damages. Just as a contract of employment is not capable of specific performance, similarly, breach of contract of employment is not capable of founding a declaratory judgment of subsistence of employment. A declaration of unlawful termination and restoration to service in such a case ofcontract of employment would be indirectly an instance of specific performance of contract for personal serviced Such a declaration is not permissible under the Law of Specific Relief Act. The second type of cases of master and servant arises under Industrial Law Under that branch of law, a servant who is wrongfully dismissed may be reinstated. This is a special provision under Industrial Law. This relief is a departure from the relief available under the Indian Contract Act and the Specific Relief Act which do not provide for reinstatement of a servant. The third category of cases of master and servant arises in regard to the servant in the employment of the State or of other public or local authorities or bodies created under statute”. 30. This was later followed by the Apex Court in Executive Committee of Vaish Degree college, shamli and others v. Lakshmi Narain and others (AIR1976 SC 888 (1). Therefore, it is well settled that except under the aforesaid three circumstances, a contract of personal service cannot be specifically enforced. It is clear that the second respondent will not come within any of these categories. Therefore, the order of reinstatement which indirectly enforces the personal contract of service is against law.
Therefore, it is well settled that except under the aforesaid three circumstances, a contract of personal service cannot be specifically enforced. It is clear that the second respondent will not come within any of these categories. Therefore, the order of reinstatement which indirectly enforces the personal contract of service is against law. The result is that the reinstatement with back wages and confirmation of the same by the first respondent is liable to be set aside. 31. Then, the next question that has to be answered is whether the second respondent should be relieved without any remedy. While discussing the evidence before the arbitrator, the learned Tribunal has found that the enquiry was vitiated and therefore, the dismissal was bad in the eye of law. Therefore, it is necessary to award a just compensation to the 2nd respondent as the contract of service is not specifically enforced. 32. The quantum of compensation has to be arrived at taking into account the service of the second respondent under the petitioner bank, the salary which she was drawing at the time of dismissal, the remaining period of service had she not been removed from the service, amount, if any, to be recovered by the petitioner for her etc. As there are no materials at present before this Court, this Court is of the view that the matter can be sent back to the Tribunal for adjudicating on the question of compensation to be awarded to the second respondent. In the result, this writ petition is disposed of upholding the finding of the Arbitration Court as well as the Tribunal that the enquiry and the consequential dismissal of the second respondent was vitiated for the reasons stated in the impugned award and judgment. However, the order of reinstating the second respondent with back wages is hereby set aside. The matter is remitted back to the Tribunal to consider the quantum of compensation to be awarded to the second respondent consequent to her termination from the service of the petitioners. It shall be open to the second respondent and the petitioners to adduce evidence in support of their rival contentions. The Tribunal shall consider the matter in the light of what has been stated above within a period of six months and shall give a verdict after considering the evidence.