BOARD OF DIRECTORS THE THRISSUR DISTRICT CO-OPERATIVE BANK LTD. v. K. B. SUNNY
2016-03-17
A.M.SHAFFIQUE, ASHOK BHUSHAN
body2016
DigiLaw.ai
JUDGMENT : Ashok Bhushan, J. Heard Sri. George Poonthottam, learned counsel for the appellants and Sri. M.M. Monaye, learned counsel appearing for the 1st respondent. 2. This writ appeal has been filed against the judgment dated 21/01/2016 in W.P.C.No.829/2016 by which the learned Single Judge has allowed the writ petition by setting aside Exts.P3 to P5. 3. The short facts which are necessary to be noticed for deciding the writ appeal are: The writ petitioners were working as Clerks in the Kodungalloor Branch of the 3rd respondent Bank. Letter dated 21/12/2015 was issued by the General Manager of the Bank to the petitioners directing that, on account of serious irregularities in the grant of gold loans at Kodungalloor Branch as per enquiry report in which petitioners were found prima facie guilty, they were suspended from the service of the bank with effect from the date pending detailed enquiry of the case. The Board of Directors of the Bank ratified the said decision. The writ petition was filed on 07/01/2016 challenging Exts.P3, P4 and P5 orders of suspension issued by the General Manager to the writ petitioners. In the writ petition, a statement was filed by the Bank wherein the order of ratification issued by the Board of Directors of the Bank as well as the order of the Government of Kerala on 30/09/1986 along with revised service regulations were brought on record. 4. The learned Single Judge, by the impugned judgment, held that the General Manager has no statutory power to issue the orders of suspension as per Rule 198(6) of the Co-operative Societies Rules (hereinafter referred to as 'the Rules'). Only the appointing authority has power to issue suspension order. Having come to the said finding, the learned Single Judge had set aside the suspension orders issued to the petitioners. Aggrieved by the said judgment, this writ appeal has been filed. 5.
Only the appointing authority has power to issue suspension order. Having come to the said finding, the learned Single Judge had set aside the suspension orders issued to the petitioners. Aggrieved by the said judgment, this writ appeal has been filed. 5. The learned counsel for the appellants contends that under Section 80(8) and (9) of the Co-operative Societies Act (hereinafter referred to as 'the Act'), the State Government is empowered to frame regulations regarding any class of employees of the Co-operative Society and the regulation which have been brought on record along with the statement dated 18/01/2016 are service regulations for the employees of District/Central Co-operative Banks of Kerala and under Regulation No.4(iii) of the said Regulations, in appropriate cases, an employee of the Bank can be placed under suspension by the General Manager subject to ratification by the Board of Directors. It is submitted that the suspension orders are in accordance with the said statutory provision. Hence the General Manager was fully competent to suspend the petitioners. It is submitted that the learned Single Judge committed error in holding that the suspension orders are contrary to statutory provisions. It is further submitted that the view of the learned Single Judge was that according to rule 198(6), only the appointing authority can suspend the employee. 6. Sri. M.M. Monaye, refuting the submission of the learned counsel for the appellants and supporting the judgment of the learned Single Judge contends that as per Rule 198(6), it is only the appointing authority who can place an employee under suspension and the General Manager has no statutory power to place the petitioners under suspension. Hence the learned Single Judge has not committed any error in allowing the writ petition. 7. We have considered the submission of the learned counsel for the parties and perused the records. Statutory provisions which have been referred to and relied by the learned counsel for the appellants is under Sections 80(8) and (9) which are to the following effect: "80. Officers, etc. of Co-operative Societies:- (1) xxxx xxxxx (8) Government shall, by order, frame uniform service Rules and Conduct Rules for the employees of any or all classes of the co-operative societies.
Officers, etc. of Co-operative Societies:- (1) xxxx xxxxx (8) Government shall, by order, frame uniform service Rules and Conduct Rules for the employees of any or all classes of the co-operative societies. (9) Suspension and disciplinary action in relation to an officer, employee or servant of a co-operative society shall be such, as may be prescribed." Rules have been framed under the Rules, namely Rule 198 which provides for disciplinary action. Rule 198(6) is relevant which is quoted as below: "198(6): An authority competent to appoint an employee may suspend him pending enquiry into serious charges against such employee. No employee shall however be kept under suspension for a period exceeding six months at a time. In no case an employee shall be kept under suspension for a continuous period exceeding one year without the prior approval of the Registrar. An employee under suspension shall be entitled to subsistence allowance payable under the Kerala Payment of Subsistence Allowance Act, 1972 (27 of 1973)." 8. There cannot be any dispute that under the provisions of Rule 198(6), the appointing authority is statutorily empowered to place an employee under suspension. However, the Bank has already brought on record the revised service regulations of the employees of the District/Central Co-operative Bank dated 30/09/1986 in which Rule 4(iii) reads as follows: (iii) In appropriate cases an employee may be kept under suspension pending enquiry. In the case of General Manager and Deputy General Manager the powers for suspension pending enquiry shall be exercised by the President and in all other case by the General Manager, subject to ratification by the Board of Directors. In the normal circumstance no employee shall be kept under suspension pending enquiry for more than one year. In cases where it is found necessary to extend the period of suspension beyond one year the prior permission of Registrar of Co-operative Societies shall be taken." 9. As noted above, under Section 80(8) of the Act, the State Government is fully empowered to frame service regulations for any class of employees of the Co-operative Societies. Regulations framed are referable to delegated legislative power given to the State Government under Section 80(8) of the Act. Regulation 4(iii) of the Revised Regulations, as quoted above, in no manner contravenes the provision of 198(6) or any other provision in the Act.
Regulations framed are referable to delegated legislative power given to the State Government under Section 80(8) of the Act. Regulation 4(iii) of the Revised Regulations, as quoted above, in no manner contravenes the provision of 198(6) or any other provision in the Act. The regulations, in essence, provide that suspension can be made in appropriate cases by the General Manager with regard to clerical staff subject to ratification of the Board of Directors. The power of Board of Directors, with regard to suspension, has been retained and any action taken by the General Manager is subject to ratification which clearly retains the power of the appointing authority with regard to suspension. Regulations 4(iii) cannot be said to contravene Rule 198(6) in any manner. When the State Government have been given a general power to frame rules for regulating the service conditions of employees, service condition can be framed which may also include the procedure and manner for ordering suspension and the Regulation 4(iii) is fully covered by the statutory power given by the State under Section 80(8) of the Act. We are of the view that the emergency power given to General Manager to suspend has to survive along with the statutory provision under Rule 198 (6) that is the appointing authority who ultimately retains the power of ratification of suspension. We are thus of the view that the learned Single Judge committed error in holding that the General Manager has no power to suspend the employees. 10. The learned counsel for the appellants submits that although suspension was ordered on 21/12/2015, till date, charge memo has not been issued. The learned counsel appearing for the Bank submits that charge memo shall be issued within a period of four weeks from the date of receipt of a copy of this judgment and disciplinary enquiry shall also be completed as expeditiously as possible. Recording the aforesaid submission of the learned Counsel appearing for the Bank, we allow the writ appeal setting aside the judgment of the learned Single Judge dated 21/01/2016 in W.P.C.No.829/2016.