President and Disciplinary Authority The Merchants’ Souharda Sahakara Bank Niyamita Chitradurga v. G. Devadas S/o C. G. Govinda Naik
2016-07-18
B.S.PATIL
body2016
DigiLaw.ai
ORDER : Petitioner No.1 is the President of the Merchants’ Souharda Sahakara Bank Niyamita. 2nd petitioner is its Chief Executive Officer. They have filed this Writ Petition challenging the order passed by the Karnataka Appellate Tribunal in Appeal No.452/2010 on 12.01.2016 thereby setting aside the order passed by the Joint Registrar of Co-operative Societies-respondent No.2 herein and directing reinstatement of the 1st respondent into service with all service and financial benefits but reserving liberty in favour of the Bank to continue the domestic enquiry from the stage at which it had been stopped, by affording an opportunity to the official to defend himself against the charges leveled against him. 2. Briefly stated, the facts involved in the case are that respondent No.1 was working as Head Cashier in the Merchants’ Souharda Sahakara Bank Niyamita, Chitradurga. He was placed under suspension on 29.03.2006 pending criminal investigation and disciplinary enquiry. A charge sheet dated 24.07.2007 was issued alleging that he had committed misconduct in not discharging his duties as a responsible and trustworthy official of the Bank as he had indulged in irregularities with regard to alleged loss of Rs.10 lakhs. In the Statement of Imputation of charges, it was alleged against him that he had misappropriated a sum of Rs.10 Lakhs belonging to the Bank and had falsely reported to the higher officers that the said amount had disappeared. 3. In the enquiry three witnesses were examined. The three witnesses in their allegedly deposition admitted that respondent No.1 was not responsible for the loss caused to the Bank. At this stage, the enquiry was abandoned by the Bank and the Bank proceeded to pass an order dismissing respondent No.1 from his service vide order dated 24.10.2008. Respondent No.1 raised a dispute before the Joint Registrar of Co-operative Societies under Section 39 of the Karnataka Souharda Sahakari Act, 1997. 4. The Joint Registrar, at the request of the Bank permitted the Bank to lead evidence and after recording evidence of two witnesses and after accepting in evidence certain documents by providing opportunity to the 1st respondent to cross-examine the witnesses, he recorded a finding that the dispute was not with regard to misappropriation of the funds of the Bank but was with regard to breach of trust by the employee and loss of confidence in him by the Bank.
It further found that no material was produced by the 1st respondent-employee to support his contention that he was not guilty of charges levelled against him. The Joint Registrar came to the conclusion that as the petitioner had not produced any document to establish that he had not misappropriated any amount and had not indulged in any act of breach of trust and as the Bank had adduced evidence, the dismissal order could not be interfered with. 5. This order was challenged before the Tribunal. The Tribunal has found fault with the order passed by the Joint Registrar. It has proceeded, upon examination of the records to record a finding that the Bank acted in great haste by circumventing the procedure in dismissing the appeal filed before it and the said conduct of the respondent-Bank smacked of malafides against the appellant. It also found fault with the resolution of the Board and held that no valid reason was forthcoming why appellant was dismissed when charges leveled against him had not been proved in the domestic enquiry. 6. Further, the Tribunal held that charges leveled against the appellant were grave in nature and hence he was entitled for a free and fair opportunity of defending himself which had been clearly denied by the Bank. Though evidence had been let-in by the Bank before the Joint Registrar, the Tribunal found that the Joint Registrar had failed to analyze the evidence. In so far as the evidence that was placed by the Bank, this is what the Tribunal has recorded at Paragraph 11 of its judgment: “We have also gone through the evidence produced by the respondent-Bank before the court below. The only document produced before the court are Xerox copies of various extracts and books of accounts of the respondent-Bank found at Pages 142 to 154 but none of these documents have either been explained by the witness as to how they conclusively prove that the appellant had indeed committed the misappropriation of Rs.10 lakhs nor have they been explained by respondent 3 in the impugned order to show how he arrived at the conclusion that the evidence produced the respondent-Bank corroborates or proves the allegation of misappropriation against the appellant.
Viewed from any angle the order of dismissal is vitiated by the denial of opportunity to the appellant to defend himself in a proper manner in the domestic enquiry and the unwarranted premature decision of the Board of Management to dismiss the appellant from service without the charges levelled against him having been proved in the domestic enquiry is illegal arbitrary and clearly violative of principles of natural justice.” The Tribunal has further found that the Joint Registrar without analyzing the evidence produced and without discussing the evidence had come to an erroneous conclusion that Bank’s order of dismissal was proper. 7. The main contention urged by the learned counsel for the petitioner is that the Tribunal was in error in passing the impugned order directing reinstatement of the respondent-official with full financial benefits having come to the conclusion that Joint Registrar had failed to analyze the evidence and record specific finding with regard to the guilt of the official. He urges that it was the duty of the Tribunal to consider the evidence on record and come to an independent conclusion with regard to proof of charge levelled against him as the Tribunal was acting as a Appellate Authority. He has placed reliance on the judgment of this Court in the case of THE HASSAN CO-OPERATIVE MILK PRODUCERS’ SOCIETIES UNION LIMITED VS. THE ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES in W.P. No. 25516 of 2010 disposed of on 21st December 2011 to contend that Joint Registrar had rightly permitted the Bank to adduce evidence in proof of the charges levelled against the official and indeed the Bank had examined two witnesses and produced number of documents. Therefore, if the Joint Registrar had failed to analyze the said evidence, it was the duty of the Tribunal to undertake that exercise and come to an independent conclusion in that regard. He has placed reliance on the judgment of the Apex Court in the case of THE WORKMEN OF M/S.FIRESTONE TYRE & RUBBER CO. OF INDIA P. LTD. VS. THE MANAGEMENT AND OTHERS reported in AIR 1973 SC 1227 to emphasis the fact that Bank was entitled to lead evidence and place materials before the Joint Registrar to sustain the order of dismissal even though the enquiry conducted was defective. 8.
OF INDIA P. LTD. VS. THE MANAGEMENT AND OTHERS reported in AIR 1973 SC 1227 to emphasis the fact that Bank was entitled to lead evidence and place materials before the Joint Registrar to sustain the order of dismissal even though the enquiry conducted was defective. 8. Counsel appearing for the respondent urges that this is a clear case of victimization and unfair practice adopted against the 1st respondent as he was dismissed without holding any enquiry and no evidence to prove the charge of misconduct or breach of trust had been led even before the Joint Registrar and therefore, the order passed by the Tribunal was right and justified. 9. Having heard the learned counsel for both parties, the only point arise for consideration is: “Whether the Tribunal was right and justified in allowing the appeal directing reinstatement with all financial benefits with liberty to the Bank to continue disciplinary enquiry from the stage where it was stopped?” 10. On careful consideration of the entire material on record and the findings recorded by both the authorities viz., Joint Registrar and the Appellate Tribunal, I find that while the Joint Registrar has proceeded on an erroneous basis that burden was on the appellant before him to prove his innocence and defence as against the allegation of misconduct and breach of trust, the Tribunal has erred in not examining the nature of evidence placed before the Joint Registrar to record an independent conclusion as to whether any of the charges levelled against the official-respondent were proved on the strength of the evidence placed before the Joint Registrar. As adverted to above, two witnesses have been examined by the Bank before the Joint Registrar. Certain documents have been produced. The Joint Registrar has not analyzed the evidence and has not come to any conclusion as to whether the said evidence was sufficient to prove the charge. On the other hand he proceeds on an erroneous basis that it was the appellant before him who had to establish his innocence. He has proceeded on the basis that the charge was only limited to breach of trust and not with regard to misappropriation. Indeed, the charge framed encompassed both aspects with regard to alleged misappropriation of Rs.10 Lakhs and breach of trust. This is evident from a reading of Charge No.1 along with the Imputation of Charge.
He has proceeded on the basis that the charge was only limited to breach of trust and not with regard to misappropriation. Indeed, the charge framed encompassed both aspects with regard to alleged misappropriation of Rs.10 Lakhs and breach of trust. This is evident from a reading of Charge No.1 along with the Imputation of Charge. It is the burden of the Management of the Bank to establish the same by leading evidence. The Tribunal has not undertaken the exercise of examining the evidence placed before the Joint Registrar. It has principally kept in mind the conduct of the Bank in abandoning the enquiry half way and hastily proceeding to dismiss the employee/1st respondent from service. 11. As rightly pointed out by counsel for the petitioner by referring to the judgment of the Supreme Court in the case of THE HASSAN CO-OPERATIVE MILK PRODUCERS’ SOCIETIES UNION LIMITED VS. THE ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES and the judgment of this Court dated 21st December 2011 in W.P.No.25516 of 2010, the Management could adduce evidence before the Joint Registrar and make an effort to sustain the order of dismissal. Question is whether it has successfully done so. Doubtless, it has adduced evidence but the effect of the evidence has not been considered either by the Joint Registrar or by the Tribunal. The Tribunal has summed up saying that evidence adduced did not prove the guilt but it has not gone into the nature of the evidence adduced. 12. Therefore, in my view, the order passed by the Tribunal cannot be sustained. As the Tribunal is entitled to re-appreciate the evidence and come to an independent conclusion, I do not find it just and proper to remit the matter back to the Joint Registrar by setting aside the order of the Tribunal. Ends of justice will be met if the matter is remitted to the Tribunal with a direction to the Tribunal to reconsider the matter by examining the evidence adduced in accordance with law both in domestic enquiry and also in the course of proceedings before the Joint Registrar and come to a definite conclusion on merits with regard to charges levelled. It is made clear that the Tribunal shall dispose of the case within two months from the date of receipt of a copy of this order. 13. Accordingly, Writ Petition is allowed in part.
It is made clear that the Tribunal shall dispose of the case within two months from the date of receipt of a copy of this order. 13. Accordingly, Writ Petition is allowed in part. The impugned order dated 12th January 2016 passed in Appeal No. 452/2010 by the Karnataka Appellate Tribunal is set aside. The matter is remitted to the Tribunal for fresh consideration in the light of the observations made above and dispose of the same in accordance with law within an outer limit of two months. The Bank shall pay cost of the proceedings to the employee-respondent No.1 in a sum of Rs.25,000/- as it is the Bank which is responsible for the delay and the matter is now remanded for fresh enquiry, due to the mistake of the Bank. The lower court records are directed to be sent to the Tribunal immediately. Both parties are directed to appear before the Tribunal on 2nd August 2016.