B. Preethakumari v. Joint Registrar of Co-Operative Societies (General)
2022-08-30
ALEXANDER THOMAS, ANU SIVARAMAN, VIJU ABRAHAM
body2022
DigiLaw.ai
ORDER : Alexander Thomas, J. The above matters have been placed before this Full Bench on the basis of an order dated 25.06.2020, rendered by a Division Bench of this Court, referring some of the cases to the Full Bench, which in turn, was on the basis of an order dated 06.11.2019, rendered by the learned Single Judge, in some of those cases. As per the afore order dated 06.11.2019, the learned Single Judge has taken the view that the dictum laid down by the Division Bench of this Court, in the case in Ambika v. Kottappady Service Co-operative Bank Ltd. [ 2018 (3) KLT 779 (DB)], requires reconsideration and that the proposition laid down in Ambika’s case supra [ 2018 (3) KLT 779 (DB)] is doubted and after citing various decisions therein, more particularly, the decision of the Apex Court in the case in State Bank of India (SBI) & Ors v. S.N. Goyal [ 2008 (8) SCC 92 ], the learned Single Judge has doubted the correctness of the proposition rendered by the Division Bench of this Court in Ambika’s case supra [ 2018 (3) KLT 779 (DB)]. 2. The Division Bench, as per the afore order dated 25.06.2020, has noted that the afore view taken by the learned Single Judge is that, in the light of the judgment of the Apex Court in S.N.Goyal's case supra [ 2008 (8) SCC 92 ], the decision of the Division Bench of this Court in Ambika’s case supra [ 2018 (3) KLT 779 (DB)] requires reconsideration and therefore, opined that, being a bench of co-equal strength, it is only befitting to have an authoritative pronouncement on the issue by a larger bench. It is on that basis that the reference has been placed before this Full Bench for solving the above said issue. 3.
It is on that basis that the reference has been placed before this Full Bench for solving the above said issue. 3. The Division Bench of this Court in Ambika’s case supra [ 2018 (3) KLT 779 (DB)], after placing reliance on paragraphs 9 and 10 of the decision of the Apex Court in Maharashtra State Co-operative Housing Finance Corporation Ltd. v. Prabhakar Sitaram Bhadange [ 2017(5) SCC 623 ], has taken the view that, since the Registrar/Co-operative Arbitration Court, whose jurisdiction is coterminous with that of the Civil Court, cannot specifically enforce a contract of personal service, which is barred under Sec.14(c) read with Sec. 41(e) of the Specific Relief Act, 1963 and that therefore, the order of such an adjudicatory forum, ordering the reinstatement in service of a dismissed employee of a Co-operative society, would amount to specifically enforcing a contract of personal service, which cannot be granted by the court. Whereas, Sec.11A of the Industrial Disputes Act, 1947 empowers the Labour Court/Industrial Tribunal for the reinstatement of the workman, on such terms and conditions as stipulated and that such a power is wholly absent for the Civil Court, etc. We are essentially called upon to decide on the correctness or otherwise of the above said dictum laid down by the Division Bench of this Court in Ambika’s case supra [ 2018 (3) KLT 779 (DB)] as to whether the Co-operative Arbitration Court, which is an adjudicatory body under Sec.69 of the Kerala Co-operative Societies Act (‘KCS Act’ for short), has the power to order reinstatement of an employee, who has been terminated from service for misconduct, etc. 4. At the outset, it has to be noted that the subject matter of consideration of the decision of the Apex Court in Prabhakar Sitaram's case supra [ 2017(5) SCC 623 ] was as to whether the adjudicatory forum viz., the notified Registrar, constituted in terms of Sec.91 of the Maharashtra State Co-operative Societies Act, for resolving disputes, has the power to entertain service disputes of employees of co-operative societies, as per the provisions of the said Acts and Rules framed thereunder and for consideration of reliefs, including reinstatement in service, etc. Para 4 of the decision in Prabhakar Sitaram’s case supra has extracted the provision contained in Sec.91 of the Maharashtra Co-operative Societies Act, 1960 (Maharashtra Act No. XXIV of 1961).
Para 4 of the decision in Prabhakar Sitaram’s case supra has extracted the provision contained in Sec.91 of the Maharashtra Co-operative Societies Act, 1960 (Maharashtra Act No. XXIV of 1961). Section 91 thereof deals with disputes and the same reads as follows :- “Sec.91. Disputes.- (1) Notwithstanding anything contained in any other law for the time being in force, any dispute touching the constitution, elections of the committee or its officers other than elections of committees of the specified societies including its officer, conduct of general meetings, management or business of society shall be referred by any of the parties to the dispute, or by a federal society to which the society is affiliated or by a creditor of the society, to the Co-operative Court if both the parties thereto are one or other of the following : (a) a society, its committee, any past committee, any past or present officer, any past or present agent, any past or present servant or nominee, heir or legal representative of any deceased officer, deceased agent or deceased servant of the society, or Liquidator of the society; or the Official Assignee of a de-registered society; (b) a member, past member or a person claiming through a member, past member or a deceased member of society, or a society which is a member of the society or a person who claims to be a member of the society; (c) a person other than a member of the society, with whom the society has any transactions in respect of which any restrictions or regulations have been imposed, made or prescribed under section 43, 44 or 45, and any person claiming through such person; (d) a surety of a member, past member or deceased member, or surety of a person other than a member with whom the society has any transactions in respect of which restrictions have been prescribed under section 45, whether such surety or person is or is not a member of the society; (e) Any other society or the Liquidator of such a society or deregistered society or the Official Assignee of such a de-registered society.
Provided that, an industrial dispute as defined in clause (k) of section 2 of the Industrial Disputes Act, 1947, or rejection of nomination paper at the election to a committee of any society other than a notified society under section 73-IC or a society specified by or under section 73-G, or refusal of admission to membership by a society to any person qualified there for or any proceeding for the recovery of the amount as arrears of land revenue on a certificate granted by the Registrar under sub-section (1) or (2) of section 101 or sub-section (1) of Section 137 or the recovery proceeding of the Registrar or any officer subordinate to him or an officer of society notified by the State Government, who is empowered by the Registrar under sub-section (1) of section 156 shall not be deemed to be a dispute for the purposes of this section. (2) Sub section (2) deleted (3) Save as otherwise provided under sub-section (2) of section 93, no Court shall have jurisdiction to entertain any suit or other proceedings in respect of any dispute referred to in sub-section (1). Explanation 1- A dispute between the Liquidator of a society 6or Official Assignee of a deregistered society and 7the members (including past members, or nominees, heirs or legal representative or deceased members) of the same society shall not be referred to the Co-operative Court under provisions of sub-section (1).
Explanation 1- A dispute between the Liquidator of a society 6or Official Assignee of a deregistered society and 7the members (including past members, or nominees, heirs or legal representative or deceased members) of the same society shall not be referred to the Co-operative Court under provisions of sub-section (1). Explanation 2 - for the purposes of this sub-section a dispute shall include- (i) a claim by or against a society for any debt or demand due to it from a member or due from it to a member, past member or the nominee, heir or legal representative of a deceased member, or servant or employee whether such a debt or demand be admitted or not; (ii) a claim by a surety for any sum or demand due to him from the principal borrower in respect of a loan by a society and recovered from the surety owing to the default of the principal borrower, whether such a sum or demand be admitted or not; (iii) a claim by a society for any loss caused to it by a member, past member or deceased member, by any officer, past officer; or deceased officer, by any agent, past agent or deceased agent, or by any servant, past servant or deceased servant, or by its committee, past or present, whether such loss be admitted or not; (iv) a refusal or failure by a member, past member or a nominee, heir or legal representative of a deceased member, to deliver, possession to a society of land or any other asset resumed by it for breach of condition as the assignment.” Therein the Apex Court, after elaborate consideration, has held that the word “Officers” used in Sec.91(1) is used in an altogether different sense, viz. election of the committee or its officers and that thus, the word “Officers” appearing in Sec.91 has reference to election and that it is in the same hue that the expression “Officer” occurs a second time as well in Sec. 91(1)(a). These aspects have been so held by the Apex Court in para 13 of Prabhakar Sitaram's case supra [ 2017(5) SCC 623 ], which reads as follows:- “13. When we read the provision in the aforesaid manner, we arrive at a firm conclusion that service dispute between the employees of such Co-operative society and the management of the society are not covered by the aforesaid provision.
When we read the provision in the aforesaid manner, we arrive at a firm conclusion that service dispute between the employees of such Co-operative society and the management of the society are not covered by the aforesaid provision. The context in which the word “officers” is used is altogether different, namely, election of the committee or its officers. Thus, the word “officers” has reference to elections. It is in the same hue expression “officer” occurs second time as well.” The Apex Court also considered the further argument that such service disputes should be treated as disputes, which touch the “management” or “business” of the society. After referring to various other case laws on the subject, especially those rendered by the Apex Court, it was held that a petition filed by an aggrieved employee of a co-operative society, registered under the Maharashtra Co-operative Societies Act, for adjudication of service disputes, including that in relation to dismissal from service, etc., is not maintainable and that the aggrieved employee therein will be at liberty to file a civil suit (see para 22 thereof). Some of the parties provided a copy of Maharashtra State Co-operative Societies Act, 1960 and the Rules framed thereunder as is available in the internet. 5. We note that various clauses of definitions contained in Sec.2 of the Maharashtra Co-operative Societies Rules do not provide for a definition of ‘dispute or disputes’, which is appearing in Sec.91. So also, on going through the Maharashtra Co-operative Societies Rules, framed under the above said Act, we note that there are no statutory provisions in those statutory rules, which deal with the matters in connection with recruitment and various conditions of service of employees of Co-operative Societies registered under the said Act, including matters relating to termination from service for misconduct or otherwise. On the other hand, what we could note is that Rule 8 of the Maharashtra State Co-operative Societies Rules, 1961, deals with matters in respect of which the Registrar may direct the Co-operative society to make bye-laws, in respect of all or any of the matters mentioned in clauses 8(1)(a) to (z) therein.
On the other hand, what we could note is that Rule 8 of the Maharashtra State Co-operative Societies Rules, 1961, deals with matters in respect of which the Registrar may direct the Co-operative society to make bye-laws, in respect of all or any of the matters mentioned in clauses 8(1)(a) to (z) therein. Clause (q) of Rule 8(1) says that the Registrar may require a co-operative society to make bye-laws, in respect of the method of recruitment, the conditions of service and the authority competent to fix, revise or regulate the scale of pay and allowances of salaried officers and servants of the society and the procedure to be followed in the disposal of disciplinary cases against them, etc. So, these Rules make it clear that the power to make bye-laws, in respect of the subjects mentioned in Rule 8, is vested with the co-operative society and the Registrar may require the co-operative society to make bye-laws, in respect of the matters covered by Clauses (a) to (z) of Rule 8(1) of the Maharashtra State Co-operative Societies Rules. Rule 8(2) deals with certain other matters on which the co-operative society may make bye-laws. We find from the Maharashtra State Co-operative Societies Act and Rules framed thereunder that there are no specific statutory provisions, either in the Act or in the Rules thereunder, which mandate specifically about the matters of recruitment and conditions of service of employees of the co-operative societies, except that Rule 8 of the Co-operative Societies Act envisages that the co-operative society may make bye-laws in that regard and that the Registrar may direct the society to make bye-laws on those subjects, as above. In the light of these aspects, it is to be noted that the notified adjudicatory forum, viz., notified Registrar, under Sec.91 of the Maharashtra State Co-operative Societies Act, does not have the jurisdiction to entertain any application or petition preferred by the aggrieved employee for adjudication of service disputes, more so particularly, in the light of the aforesaid categorical legal position laid down by the Apex Court in Prabhakar Sitaram's case supra [ 2017(5) SCC 623 ]. 6.
6. Now, we would proceed to make a brief overview of the various provisions in the Kerala Co-operative Societies Act (for short ‘KCS Act’) and Kerala Co-operative Societies Rules (for short ‘KCS Rules’), which deal with matters concerning recruitment and conditions of service of employees, including that for suspension, disciplinary action, procedure for imposition of major penalty like dismissal from service etc. Brief overview of the relevant provisions of the KCS Act and KCS Rules:- 7. The preamble to the KCS Act, 1969 (State Act 21 of 1969) and its amended provisions say that the same has been enacted to provide for the orderly development of co-operative societies in the State and that it is essential to organize co-operative societies, in accordance with Co-operative principles, as self governing, democratic institutions, to achieve the objects of equity, social justice and economic development, as envisaged in the Directive Principles of State Policy of the Constitution of India etc. The above Act came into force on 15.05.1969. 8. Sec.2(i) deals with the definition of ‘dispute’ and the same reads as follows:- “Sec.2(i) "dispute" means any matter touching the business, constitution, establishments or management of a society capable of being the subject of litigation and includes a claim in respect of any sum payable to or by a society, whether such claim be admitted or not;” (emphasis supplied). Chapter IX deals with settlement of disputes and the said Chapter comprises of Secs. 69, 69A, 70, 70A and 70B. 9. Sec.69 deals with disputes to be decided by the Co-operative Arbitration Court and the Registrar. So, the word “disputes” referred to in Sec. 69, etc. should be understood in the light of Section 2(i) of the KCS Act. 10. Secs. 61(1) and 62 of the KCS Act and Rules 58 and 59, respectively of the KCS Rules, appearing in Chapter VI thereof, deal with Provident Fund and Gratuity, as above. Incidentally, it may not be out of place to note that Sec. 80(7) of the Act mandates that notwithstanding anything contained in the bye-laws, a society shall not pay bonus to its employees exceeding the amount and the rate fixed by the Government or the Registrar from time to time. 11. Chapter XII of the KCS Act comprising of Secs.80 to 80E thereof, deals with establishment. So also, Chapter XV of the KCS Rules comprising of Rules 182 to Rule 202 thereof, deals with establishment.
11. Chapter XII of the KCS Act comprising of Secs.80 to 80E thereof, deals with establishment. So also, Chapter XV of the KCS Rules comprising of Rules 182 to Rule 202 thereof, deals with establishment. 12. Sec. 80 of the KCS Act deals with officers and employees of the co-operative societies. Sec.80(1) stipulates that the Government shall classify the societies in the State according to their type and financial position. Rule 182 deals with classification under Sec.80. Sec. 80(2) mandates that the Government shall, in consultation with the Registrar, fix or alter the number and designation of the officers and servants of the different classes of societies specified in Sec. 80(1). Sec.80(3) mandates that the Government shall make rules either prospectively or retrospectively regulating the qualification, remuneration, allowances and other conditions of service of the officers and servants of the different classes of societies specified in Sec. 80(1). Sec. 80(8) further mandates that the Government shall, by order, frame uniform Service Rules and Conduct Rules for the employees of any or all classes of the Co-operative societies. Sec. 80(9) stipulates that suspension and disciplinary action in relation to an officer, employee or servant of a co-operative society shall be such, as may be prescribed. Sec. 2(o) defines the word ‘prescribed’ as to mean prescribed by rules made under the Act. Since Sec.80 is a very crucial provision as regards the present issue, it may be pertinent to quote the entire sub-sections of Sec.80 of the Act, which read as follows:- “Sec.80. Officers, etc. of co-operative societies.-(1) The Government shall classify the societies in the State according to their type and financial position. (2) the Government shall, in consultation with the Registrar, fix or alter the number and designation of the officers and servants of the different classes of societies specified in sub-section (1). (3) The Government shall, make rules either prospectively or retrospectively regulating the qualification, remuneration, allowances and other conditions of service of the officers and servants of the different classes of societies specified in sub-section (1).
(3) The Government shall, make rules either prospectively or retrospectively regulating the qualification, remuneration, allowances and other conditions of service of the officers and servants of the different classes of societies specified in sub-section (1). (3A) Notwithstanding anything contained in this Act or the rules made or orders issued thereunder or in the bye-laws of any society relating to the recruitment and conditions of service of officers and servants of societies, all appointments of officers and servants of the societies mentioned in the Scheduled I for which direct recruitment is resorted to shall be made from a select list of candidates furnished by the Kerala Public Service Commission and in making such recruitment the reservation principles under rule 14 to 17 of the Kerala State and Subordinate Service Rules, 1958 shall be followed. (3AA) Notwithstanding anything contained in this Act or any other law, or judgment or order of any court, all appointments already made on the advice by the Kerala Public Service Commission following the reservation principles under rule 14 to 17 of the Kerala State and Subordinate Service Rules, 1958 to the societies mentioned in the schedule for which direct recruitment shall be resorted to shall be deemed to have been validly done as if such provisions were in force at that time. (3B) All appointments made by direct recruitment to the societies referred to in sub-section (3A) on or after the 25th day of April, 1995 and before the date of publication of the Kerala Co-operative Societies (Amendment) Ordinance, 1995 (Ordinance No. 10 of 1995) shall be invalid. (4) Notwithstanding anything contained in sub-section (1) or sub-section (2), ten per cent of the posts of employees of every society shall be reserved for appointment from persons belonging to the Scheduled Castes and Scheduled Tribes where the method of appointment to such posts is by direct recruitment. (5) Notwithstanding anything contained in sub-section (1) or (2), three per cent of the total posts of employees of every society shall be reserved for physically handicapped persons having disability of forty per cent or above, as certified by the medical board and the procedure of appointment shall be such as may be prescribed: Provided that in societies where there are more than ten and less than thirty three employees including cadre and sanctioned posts, there shall be reserved a minimum of one employee belonging to physically handicapped persons.
(6) Government shall have power to fix or alter the maximum and minimum limit of establishment expenses of co-operative societies including the pay and allowances and other benefits of employees of Co-operative societies: Provided that societies run on net loss can give pay and allowances to its employees below the minimum limit fixed by the Government. (7) Notwithstanding anything contained in the bye-laws, a society shall not pay bonus to its employees exceeding the amount and the rate fixed by the Government or the Registrar from time to time. (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. (10) The Government may, on mutually agreed terms and on application of a society, depute a Government servant to the service of the society for the purpose of managing its affairs and the Government servant so deputed shall exercise such powers and perform such duties as may be prescribed.” 13. Sec.80 (3A) of the Act mandates that notwithstanding anything contained in this Act or the rules made or orders issued thereunder or in the bye-laws of any society relating to the recruitment and conditions of service of officers and servants of societies, all appointments of officers and servants of the societies mentioned in the Schedule I for which direct recruitment is resorted to shall be made from a select list of candidates furnished by the Kerala Public Service Commission (PSC) and in making such recruitment the reservation principles under Rules 14 to 17 of the Kerala State and Subordinate Service Rules, 1958 shall be followed. 14. So even the power of selection and preparation of select list is no longer vested with the employer co-operative society concerned, as far as such societies in Schedule I are concerned and the same would fall exclusively within the province and domain of the Kerala Public Service Commission and this provision is engrafted in the parent Act, as per an amendment. Further, serious inroads have also been made in respect of the power of selection of such co-operative societies included in the Schedule I, as can be seen from a reading of Sub-section (3AA) and (3B) of Sec. 80 of the KCS Act.
Further, serious inroads have also been made in respect of the power of selection of such co-operative societies included in the Schedule I, as can be seen from a reading of Sub-section (3AA) and (3B) of Sec. 80 of the KCS Act. Sec. 80(4) mandates that notwithstanding anything contained in sub-section (1) or sub-section (2), 10% of the posts of employees of every society shall be reserved for appointment from persons belonging to the SC/ST, where the method of appointment to such posts is by direct recruitment. 15. Sub-section (5) of Sec. 80 of the KCS Act further stipulates that notwithstanding anything contained in sub-section (1) or (2), 3% of the total posts of employees of every society shall be reserved for physically handicapped persons having disability of 40% or above, as certified by the medical board and the procedure of appointment shall be such as may be prescribed. Proviso thereto is not very relevant for the present purposes. 16. Very pertinently, Sec. 80(6) further mandates that the government shall have power to fix or alter the maximum and minimum limit of establishment expenses of co-operative societies including the pay and allowances and other benefits of employees of co-operative societies. Proviso thereto stipulates that the societies run on net loss can give pay and allowances to its employees below the minimum limit fixed by the Government. Provisions, other than that for Disciplinary Action 17. An overview of the various provisions contained in the KCS Act and Rules mentioned hereinabove, would make it clear like the day light that various aspects, relating to even selection of open market candidates, by way of direct recruitment, when the candidate would not have even entered the service and also various aspects relating to conditions of service of in-service employees are extensively and widely covered and provided by the provisions of the Act as well as the statutory Rules framed thereunder. In that regard, it may be relevant to provide a brief outline of the relevant provisions in the KCS Act and KCS Rules, a tabular representation of which is given below: Kerala Co-operative Societies Act, 1969 Sec.80A Pension Scheme and the modalities of a Self Financing Pension Scheme.
In that regard, it may be relevant to provide a brief outline of the relevant provisions in the KCS Act and KCS Rules, a tabular representation of which is given below: Kerala Co-operative Societies Act, 1969 Sec.80A Pension Scheme and the modalities of a Self Financing Pension Scheme. Sec.80B The establishment and constitution of Co-operative Service Examination Board for the conduct of written examination for all direct recruitment to posts of and above the category of Junior Clerks in the societies and other methods of appointments, like deputation, contract basis, etc., in respect of persons, who are professionally or technically qualified or persons with experience and expertise. Sec.80C Framing of Kerala State Co-operative Employees Welfare Scheme Sec. 80D The establishment of the Kerala State Co-operative Employees' Welfare Board Sec.82 Appeals to Tribunal Sec. 84 Revision by Tribunal Sec. 109 The power to frame Rules Kerala Co-operative Societies Rules, 1969 Rule 182 Appointments for posts, below the category of Junior clerks, to be made after conducting written examination and interview and the modalities of selection for direct recruitment, in respect of societies covered under Sec.80B Rule 183 Age limit for candidates for appointment by direct recruitment and the relevant cut off dates for determining such age limits. Rule 184 Probation of candidates appointed by direct recruitment and by promotion and also makes serious inroads into the freedom/power of the Co-operative society employer to discharge a probationer. Rule 185 Promotion and cases of relaxation of qualification, other than basic qualification and pass in competitive examinations. Rule 186 Prescriptions of qualifications Rule 187 Setting apart and reserving 50% of the vacancies in Apex Society or Central Societies to the employees of similar or higher categories of the member societies. Rule 188 Staff pattern of societies to be adopted according to the type and class to which it belongs. Rule 188A Employment assistance to dependents of employees who die in harness. Rule 189 Remuneration and allowances, wherein the Government is empowered to fix or alter the maximum and minimum limit of establishment expenses of each class of societies mentioned.
Rule 188 Staff pattern of societies to be adopted according to the type and class to which it belongs. Rule 188A Employment assistance to dependents of employees who die in harness. Rule 189 Remuneration and allowances, wherein the Government is empowered to fix or alter the maximum and minimum limit of establishment expenses of each class of societies mentioned. Rules 190 & 191 Leave rules and medical allowances Rule 192 Securities to be furnished by the employees' Societies Rules 193, 194 & 195 Duties and responsibilities and conduct, prohibition of pecuniary transactions and prohibition of personal contracts of employees of Co-operative societies Rule 197 Maintenance of service register Rule 199 Travelling allowance and other allowances Rules 200 & 201 Savings clause and special provisions in respect of certain promotions 18. It may not be far off the mark to observe that various scenarios from the “cradle to grave” in the service life of an employee, right from the time of his birth in service up to his demitting the employment and even in regard to retirement benefits thereafter, are extensively and widely covered by the provisions in the Act and the Rules. Even after an employee demits employment in a co-operative society, there are provisions which regulate the grant of retiral benefits, including pension, as mandated in the Rules. We are saying so, as regards the KCS Act and KCS Rules in contradistinction to the provisions in the Maharashtra State Co-operative Societies Act and the Rules framed thereunder. Provisions in the KCS Rules regarding disciplinary action including suspension, disciplinary enquiry, penalty etc. 19. Now, we will have to focus on Rule 198, which deals with disciplinary action, including aspects relating to suspension, disciplinary enquiry and imposition of penalties, etc. 20. Rule 198(6) mandates that an authority competent to appoint an employee may suspend him from service, pending enquiry into serious charges against such employees and no employee shall be kept under suspension for a period exceeding six months at a time and in no case shall an employee be kept under suspension for a continuous period exceeding one year, without the prior approval of the Registrar. The second limb of Rule 198(6) mandates that an employee under suspension shall be entitled to subsistence allowance, payable under the Kerala Payment of Subsistence Allowances Act, 1972 (State Act 27 of 1973).
The second limb of Rule 198(6) mandates that an employee under suspension shall be entitled to subsistence allowance, payable under the Kerala Payment of Subsistence Allowances Act, 1972 (State Act 27 of 1973). The proviso thereto further mandates that an employee, not coming under the purview of the Kerala Payment of Subsistence Allowance Act 1972, shall be entitled to Subsistence Allowance, at the rate admissible to State Government Employees, as prescribed under the Kerala Service Rules. Since some of the sub-rules in Rule 198 are very cardinal and crucial for the present issues, it may be better to extract the entire contents of Rule 198, which deals with disciplinary action and its various sub-rules, which reads as follows:- “Rule 198. Disciplinary action.— (1) Any member of the establishment of a co-operative Society may, for good and sufficient reasons, be punished by imposing any of the following penalties, namely: (a) Censure; (b) Fine (in the case of employees in the last grade); (c) Withholding of increments with or without cumulative effect. (d) Withholding of promotion; (e) Recovery from pay of the whole or part of any pecuniary loss caused to the society, by negligences or breach of orders or otherwise; (f) Reduction to a lower rank; (g) Compulsory retirement; (h) Dismissal from service. (2) No kind of punishment shall be awarded to an employee unless he has been informed in writing of the grounds on which it is proposed to take action against and he has been afforded an opportunity including a personal hearing to defend himself. Every order awarding punishment shall be communicated to the employee concerned in writing stating the grounds on which the punishment has been awarded: (2A) The committee of a society shall constitute a disciplinary subcommittee consisting of not more than three of its members, of whom one shall be designated as Chairman, but the President of the committee of the society shall not be a member in the disciplinary sub-committee. (2B) The disciplinary sub-committee so constituted shall inquire into the charges against the employee either by themselves or by engaging an external agency.
(2B) The disciplinary sub-committee so constituted shall inquire into the charges against the employee either by themselves or by engaging an external agency. (3) The authority competent to impose the various penalties on different categories of employees shall be as shown in the table below: Authority competent to impose Rank of the employee Penalties under (a) to (c) Penalties under (d) to (h) Secretary/Manager or other Chief Executive Officer and all employees holding posts higher than that of Sr. Clerk/ Sr. Assistant/ I Grade Assistant/ Equivalent other employees with same or identical scale of pay All other employees President/Chairman Secretary/Manager or other Chief Executive Officer. Sub-Committee/ Executive Committee President (4) An appeal shall lie against every order imposing a penalty to the competent appellate authority, shown in the table below:- Secretary/Manager or other Chief Executive Officer and all employees holding posts higher than that of Sr. Clerk/ Sr. Assistant/ I Grade Assistant/ Equivalent other employees with same or identical scale of pay All other employees Executive Committee or Board of Management President Board of Management Executive Committee/Board of Management (5) No appeal shall be entertained if it is not preferred within a period of three months from the date of the order imposing the penalty. Provided that where the penalties are imposed on employee by an administrator or an administrative committee, such employees can file appeal before the forthcoming elected committee and in such cases the restriction of three months shall not be applicable. (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). Provided that an employee not coming under the purview of the Kerala Payment of Subsistence Allowance Act, 1972 (27 of 1973) shall be entitled to subsistence allowance at the rate admissible to State Government Employees as prescribed under the Kerala Service Rules.
Provided that an employee not coming under the purview of the Kerala Payment of Subsistence Allowance Act, 1972 (27 of 1973) shall be entitled to subsistence allowance at the rate admissible to State Government Employees as prescribed under the Kerala Service Rules. (7) In the event of any pendancy of disciplinary proceedings against any employee of a co-operative society or any co-operative institution pursuant to any charge of grave misconduct, irregularity, corruption or other charge involving moral turpitude, no retirement benefits shall be sanctioned to such employee or retired employee and in case of sanctioning of any retirement benefits to any such employee or retired employee, the name and designation of the sanctioning authority together with the reason for such sanctioning shall be recorded by the sanctioning authority by himself and such authority shall be held responsible for any loss to the society owing to such sanctioning of retirement benefits if found that such sanctioning was unwarranted. (8) In respect of all employees save the Chief Executive Officer of a society, no retirement benefits shall be sanctioned and disbursed until after the due issuance of a nonliability certificate by the Chief Executive Officer and approval of the same by the committee of the society within thirty days from the date of retirement of such employee. In the event of the retirement of the Chief Executive Officer, the non-liability certificate shall be issued by the committee of the Society. For any loss to the society due to the non-adherence of the forgoing procedure, the Chief Executive Officer along with the committee of the society shall be held responsible collectively and severally in respect of the issuance of Non-liability Certificate to any employee other than the Chief Executive Officer and the members of the committee shall be held collectively and severally responsible for the issuance of Non-liability Certificate to the Chief Executive Officer.” 21. The penalties that can be imposed on an employee are mentioned in Clauses (a) to (h) of Rule 198(1) as above, and Clauses (f), (g) and (h) thereof deal with reduction to a lower rank, compulsory retirement and dismissal from service, respectively.
The penalties that can be imposed on an employee are mentioned in Clauses (a) to (h) of Rule 198(1) as above, and Clauses (f), (g) and (h) thereof deal with reduction to a lower rank, compulsory retirement and dismissal from service, respectively. More importantly, Rule 198(2) mandates that no kind of punishment shall be awarded to an employee, unless he has been informed in writing of the grounds on which it is proposed to take action against and he has been afforded an opportunity, including a personal hearing, to defend himself and every order awarding punishment shall be communicated to the employee concerned in writing, stating the grounds on which the punishment has been awarded. Sub-rules (2A) and (2B) have been introduced subsequently as per amendments. Rule 198(2A) mandates that the committee of a society shall constitute a disciplinary sub-committee, consisting of not more than three of its members, of whom one shall be designated as Chairman, but the President of the committee of the society shall not be a member in the disciplinary sub-committee and Rule 198(2B) further mandates that the disciplinary sub-committee, so constituted, shall inquire into the charges against the employee, either by themselves or by engaging an external agency. The authorities competent to impose various penalties on different categories of employees shall be as shown in the table appended to Sub-rule (3) thereof. Sub-rule (4) of Rule 198, specifically mandates that an appeal shall lie against every order, imposing a penalty, to the competent appellate authority shown in the table appended thereto. In other words, as per the provisions contained in Sub-rule (4) of Rule 198, it has been statutorily mandated that appellate remedy shall be provided, in the case of an order imposing penalty to every employee, who suffers from the imposition of penalty and the competent appellate authority is also designated thereunder. In other words, no co-operative society has the discretion or freedom to say that they will not provide any appellate remedy, as above, or that they have the freedom to constitute an appellate body, other than the one mandated as per Rule 198(4).
In other words, no co-operative society has the discretion or freedom to say that they will not provide any appellate remedy, as above, or that they have the freedom to constitute an appellate body, other than the one mandated as per Rule 198(4). In other words, the freedom, if any, of the co-operative society to insist that they may or may not provide for appellate remedy or that, if provided, the appellate body will be in the manner deemed fit by them, etc., is no longer available to them with the intervention and inroads made by the statutory provision as per Rule 198(4). The result is that, every co-operative society is obliged to provide an appellate remedy to an aggrieved employee who suffers from any of the penalties mentioned therein and the appellate body shall be the body, as designated in the table appended under Rule 198(4), subject to the bias - avoidance norm that none of the members of the disciplinary subcommittee, who inflicted the penalty, should partake in the decision making process of the appellate body. So also, after the introduction of Sub-rules (2A) and (2B) of Rule 198, no co-operative society has the freedom to say that they will not constitute a disciplinary sub committee or that the charges against the employees shall be entered into by a body that the society may constitute, in the manner it deems fit, by taking up the plea that the disciplinary authority has the discretion either to conduct the disciplinary enquiry by themselves or delegate the process of such disciplinary enquiry to a person or body. Such a freedom is totally taken away and the disciplinary sub-committee, as mandated under Rule 198(2A), shall necessarily be constituted by the co-operative society concerned, which shall consist of not more than three members, one of whom shall be designated as Chairman or Chairperson but the President of the Managing Committee of the society shall not be a member of the disciplinary sub-committee. So also, it is such a disciplinary sub committee, so constituted in terms of Sub-rule (2A), that shall inquire into the charges against the employee, either by themselves or by engaging any external agency, as mandated in Rule 198(2B).
So also, it is such a disciplinary sub committee, so constituted in terms of Sub-rule (2A), that shall inquire into the charges against the employee, either by themselves or by engaging any external agency, as mandated in Rule 198(2B). The freedom to engage an external agency to conduct the disciplinary enquiry is only with the disciplinary sub committee, constituted under Sub-rule (2A) supra and not to the managing committee/ Executive Committee/ Board of Management/Board of Directors of the Co-operative Society concerned. Therefore, serious inroads have been made into the freedom of the contract, that may be entered into by the co-operative society employer, for regulating various conditions of service, more particularly in regard to disciplinary action and suspension, in view of the mandates of the various Rules and Subrules concerned, which, in the case of disciplinary action, is Rule 198 as above. 22. Now, we would come to sub-rule 198 (2) of the KCS Rules, the ‘heart and soul’ of the provisions contained in the KCS Rules, which is crucial and cardinal for the resolution of the issues posed in this Reference to the Full Bench. The said provision, as per Rule 198 (2), mandates that no punishment shall be awarded to an employee, unless he has been informed in writing of the grounds on which it is proposed to take action against and he has been afforded an opportunity, including a personal hearing, to defend himself and every order, awarding punishment shall be communicated to the employee concerned in writing stating the grounds on which the punishment has been awarded. Of course, Rule 198(2B) is vitally the other side of the same coin, which is that the charges shall be enquired into by the disciplinary sub committee, constituted as per sub-rule (2A) supra, as envisaged in sub-rule (2B) supra. It is only after compliance with the above said provisions, contained in sub-rule (2A) and sub-rule (2B), that the competent authority can take a decision regarding the issue as to whether or not the penalties mentioned therein could be imposed. The impact of these provisions in the KCS Rules, more particularly those as per Sub-rules (2) and (2A) etc., of Rule 198 as to whether the said provisions would constitute a statutory mandate and if so, what is the effect of such contravention, would be considered later. Provisions in the KCS Act for settlement of disputes. 23.
The impact of these provisions in the KCS Rules, more particularly those as per Sub-rules (2) and (2A) etc., of Rule 198 as to whether the said provisions would constitute a statutory mandate and if so, what is the effect of such contravention, would be considered later. Provisions in the KCS Act for settlement of disputes. 23. Sec. 69 of the KCS Act deals with disputes to be decided by the Co-operative Arbitration Court and the Registrar. The said provision is included in Chapter IX of the Act which deals with settlement of disputes. Section 69 of the KCS Act provides as follows:- “Sec. 69: Disputes to be decided by Co-operative Arbitration Court and Registrar.
23. Sec. 69 of the KCS Act deals with disputes to be decided by the Co-operative Arbitration Court and the Registrar. The said provision is included in Chapter IX of the Act which deals with settlement of disputes. Section 69 of the KCS Act provides as follows:- “Sec. 69: Disputes to be decided by Co-operative Arbitration Court and Registrar. (1) Notwithstanding anything contained in any law for the time being in force, if a dispute arises:- (a) among members; past members and persons claiming through members, past members and deceased members; or (b) between a member, past member or person claiming through a member, a past member or deceased member and the society, its committee or any officer, agent or employee of the society; or (c) between the society or its committee and any past committee, any officer, agent or employee or any past officer, past agent or past employee or the nominee, heirs or legal representatives of any deceased officer, deceased agent or deceased employee of the society; or (d) between the society and any other society; or (e) between a society and the members of a society affiliated to it; or (f) between the society and a person, other than a member of the society, who has been granted a loan by the society or with whom the society has or had business transactions or any person claiming through such a person; or (g) between the society and a surety of a member, past member, deceased member or employee or a person, other than a member, who has been granted a loan by the society, whether such a surety is or is not a member of the society; or (h) between the society and a creditor of the society; such dispute shall be referred to the Co-operative Arbitration Court constituted under Sec.70A, in the case of non-monetary disputes and to the Registrar, in the case of monetary disputes and the Arbitration Court, or the Registrar, as the case may be, shall decide such dispute and no other Court or other authority shall have jurisdiction to entertain any suit or other proceedings in respect of such dispute.
(2) For the purposes of sub-section (1), the following shall also be deemed to be disputes, namely: (a) a claim by the society for any debt or demand due to it from a member or the nominee, heirs or legal representatives of a deceased member, whether such debt or demand be admitted or not; (b) a claim by a surety against the principal debtor, where the society has recovered from the surety any amount in respect of any debt or demand due to it from the principal debtor, as a result of the default of the principal debtor, whether such debt or demand is admitted or not; (c) any dispute arising in connection with the election of the Board of Management or any officer of the society; Explanation.-- A dispute arising at any stage of an election commencing from the convening of the general body meeting for the election shall be deemed to be a dispute arising in connection with the election. (d) any dispute arising in connection with employment of officers and servants of the different classes of societies specified in sub-section (1) of S.80, including their promotion and inter se seniority. (3) No dispute arising in connection with the election of the Board of Management or an officer of the society shall be entertained by the Co-operative Arbitration Court unless it is referred to it within one month from the date of the election. (4) All monetary disputes mentioned in Schedule III to the Act shall be filed within the time limit specified in the said Schedule.” 24. As mentioned earlier, the word ‘dispute’ is specifically and expressly defined as per Sec. 2(i) of the KCS Act, which reads as follows:- 'Sec.2(i) "dispute" means any matter touching the business, constitution, establishments or management of a society capable of being the subject of litigation and includes a claim in respect of any sum payable to or by a society, whether such claim be admitted or not.” (emphasis supplied) 25. The latter part of Sec. 69(1) of the KCS Act [i.e., just before the wordings in Sub-section (2) of Sec.69] mandates that no other court or other authority shall have jurisdiction to entertain any suit or other proceedings in respect of such disputes.
The latter part of Sec. 69(1) of the KCS Act [i.e., just before the wordings in Sub-section (2) of Sec.69] mandates that no other court or other authority shall have jurisdiction to entertain any suit or other proceedings in respect of such disputes. So, the mandate in the second part of Sec. 69(1) supra is that no other court or other authority shall have the jurisdiction to entertain any suit or other proceedings in respect of such disputes, which are to be decided by the Co-operative Arbitration Court and the Registrar, as provided in that Section. The second part of Sec.69(1) of the KCS Act [i.e., just before the wordings in Sub-section (2) of Sec.69] stipulates that such disputes, viz. disputes enumerated in clauses (a) to (h) under Sec.69(1) shall be referred to the Co-operative Arbitration Court constituted under Sec.70A, in the case of non-monetary disputes and to the Registrar in the case of monetary disputes and further that, the Arbitration Court or the Registrar, as the case may be, shall decide such dispute and that no other court shall have jurisdiction to entertain any suit or other proceedings in respect of such dispute. In other words, where the dispute which falls under clauses (a) to (h) of Sec.69(1) is raised, then such disputes, which are non-monetary disputes, will have to be referred to the Co-operative Arbitration Court constituted under Sec. 70A and such disputes, which are monetary disputes, will have be referred to the Registrar and it is for such forum to decide such disputes and no court or authority, other than the Co-operative Arbitration Court, in the case of such non-monetary disputes and Registrar in the case of monetary disputes shall have the jurisdiction to entertain any suit or any other proceedings in respect of such disputes. So also, Sec.100 of the KCS Act deals with the bar of jurisdiction of courts, wherein it is stipulated therein that no civil or revenue court shall have any jurisdiction, in respect of any matter for which provision is made in the Act, viz., KCS Act. The above said provision in the matter of Co-operative Arbitration Court, has been introduced as an amendment as per State Act 1 of 2000 made effective from 2.3.2003. 26.
The above said provision in the matter of Co-operative Arbitration Court, has been introduced as an amendment as per State Act 1 of 2000 made effective from 2.3.2003. 26. Sec.69(1)(c) inter alia stipulates that, notwithstanding anything contained in any law for the time being in force, if a dispute arises between the society or its committee on the one hand and any past committee, any officer, agent or employee or any past officer, past agent or past employee or the nominee, heirs or legal representatives of any deceased officer, deceased agent or deceased employee of the society, etc., then no court or authority, other than the Co-operative Arbitration Court or notified Registrar, as the case may be, shall have jurisdiction to entertain any suit or other proceedings in respect of such dispute. Further Sec. 69(2) stipulates that, for the purposes of Sec.69(1), the claims or disputes mentioned thereunder shall also be deemed to be disputes. Clause (d) of Sec.69(2) has been introduced as per amendment vide State Act 1 of 2000 made effective from 02.01.2003. Hence, it is specifically stipulated in Sec. 69(2)(d) that any dispute, arising in connection with employment of officers and servants of the different classes of societies specified in Sec. 80(1), including their promotion and inter se seniority shall also be deemed to be disputes within the purview of Sec.69(1). 27. Sec.70 deals with award on disputes and Sec.70(1) stipulates that the Co-operative Arbitration Court, on receipt of reference under sub-section (1) of section 69, shall pass an award within one year, etc., in accordance with the provisions of this Act and the rules and the bye-laws made thereunder and such award shall, subject to the provisions of Sec.82, be final. Sec.70(2) empowers the Co-operative Arbitration Court with the discretion to make interlocutory orders, as it may deem necessary in the interest of justice, pending award of a dispute referred to it under Sec.69. Further, Sec.70(3) mandates that the Co-operative Arbitration Court shall have the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 (Central Act 5 of 1908), while trying a suit in respect of the matters mentioned therein. Section 70(3) of the KCS Act, provides as follows:- “Sec. 70: Award on disputes (1).....
Further, Sec.70(3) mandates that the Co-operative Arbitration Court shall have the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 (Central Act 5 of 1908), while trying a suit in respect of the matters mentioned therein. Section 70(3) of the KCS Act, provides as follows:- “Sec. 70: Award on disputes (1)..... xxx xxx xxx (3) The Co-operative Arbitration Court shall have the same powers as are vested in a civil Court under the Code of Civil Procedure, 1908 (Central Act 5 of 1908), while trying a suit in respect of the following matters, namely:- (i) the summoning and enforcing the attendance of any defendant or witness and examining the witness on oath; (ii) the discovery and production of any document or other material object producible as evidence; (iii) the reception of evidence on affidavits; (iv) issuing of any commission for the examination of any witness; and (v) any other matter which may be prescribed.” The constitution of the Co-operative Arbitration Courts is dealt with in Sec. 70A. Chapter XIII of the Act deals with appeals, revision and review and comprises of Secs. 81 to 87 thereof. Sec. 82 of the KCS Act provides for appeals to the Tribunal. Sub-section (2) of Sec. 82 of the KCS Act states that an order passed by the Tribunal, under sub-section (1), shall be final. 28. Section 81 deals with the constitution of the Tribunal and Section 81(2) stipulates that a person shall not be qualified for appointment as a member of the Tribunal unless he is or has been holding the post of a District Judge in the State. 29. Sec.84 provides for revision by Tribunal, wherein it is stipulated that the Tribunal may call for and examine the record of any proceedings in which an appeal lies to it, for the purpose of satisfying itself as to the legality or propriety of any decision or order passed and if in any case it shall appear to the Tribunal that any such decision or order should be modified, annulled or revised, the Tribunal may pass such order thereon, as it may deem fit. Two provisos are appended to Sec.84.
Two provisos are appended to Sec.84. Sec. 86 stipulates that, where an appeal is made to the Tribunal under section 82 or where the Tribunal calls for the record of a case under sec.84, then it may, in order to prevent the ends of justice being defeated, make such interlocutory orders, pending the decision of the appeal or revision as it may deem fit. Sec.85 of the KCS Act deals with review of orders by the Tribunal. 30. Chapter XII of the KCS Rules, comprising of Rules 95 to 125, deals with appeals, revision and review and various provisions regarding those subject matters. Rule 115 of the KCS Rules deals with fresh evidence in appeal and Rule 122 thereof deals with the application of Code of Civil Procedure. etc. Chapter IX of the KCS Rules deals with settlement of disputes. Rule 67 thereof deals with reference of disputes, payment of expenses and decisions on disputes. Sub-rules (5) to (9) of Rule 67 deal with certain procedures for exercise of powers of the Co-operative Arbitration Court, as mentioned therein. Case laws regarding the jurisdiction of the adjudicatory forum under Sec.69 to deal with service disputes: 31. The various case laws which came up for consideration before the different benches of this Court since 1978, as to whether a service dispute between an employee of any co-operative society and the employer co-operative society is triable by the forum prescribed under the KCS Act or the Industrial Disputes Act (ID Act) or under both the Acts, as per the choice of the aggrieved person to select the forum under any of the Acts, for deciding such service disputes, has been briefly narrated in paras 9 to 17 of the decision of the Apex Court in the case in K.A.Annamma v. Secretary, Cochin Co-operative Hospital Society Ltd. [ (2018) 2 SCC 729 ]. Hence, there is no necessity to refer those case laws except to note a previous decision of the Full Bench of this Court in the case in K.Balachandran v. Dy. Registrar of Co-operative Societies [ 1978 KLT 249 = AIR 1978 Ker.126]. The question that was raised in K.Balachandran's case supra [ 1978 KLT 249 (FB)] was as to whether the notified Registrar has jurisdictional competence under Sec.69 to decide on the disputes relating to relative seniority of the employees of co-operative society.
Registrar of Co-operative Societies [ 1978 KLT 249 = AIR 1978 Ker.126]. The question that was raised in K.Balachandran's case supra [ 1978 KLT 249 (FB)] was as to whether the notified Registrar has jurisdictional competence under Sec.69 to decide on the disputes relating to relative seniority of the employees of co-operative society. The Full Bench in K.Balachandran's case supra [ 1978 KLT 249 ] has noted, in para No.3 thereof, that it is beyond dispute that no rules or bye-laws, regulating seniority and promotion as between the appellant therein and R-4 therein, or in respect of the employees of the Co-operative Society have been framed and hence, it was held that, in the absence of such rules, regulations or bye-laws, a dispute as to seniority or promotion cannot be entertained or made the subject of litigation in a civil court, etc. A reference to para No.4 thereof would make it clear that the learned Addl. Advocate General had sought to sustain the Registrar's powers under Rules 176 and 185 of the KCS Rules. 32. A reading of para 1 in K.Balachandran's case supra [ 1978 KLT 249 ] would indicate that the impugned promotions were made, in the facts of that case, on 1.5.1969 and the impugned reversion was made on 1.1.1970. 33. The Full Bench has held, in para 5 thereof, that Rule 185 had no application to the facts of the said case, as the rule came into force only on 1.1.1974, i.e., after the date of the proceedings impugned therein. Since the proceedings impugned in those cases were issued much before the engraftment of Rule 185 in the statute book, which was made effective only on 1.1.1974, it was held that the said rule has no application in the facts and circumstances of that case considered by the Full Bench. 34. Various decisions of this Court, including the Full Bench decision in K.Balachandran's case supra [ 1978 KLT 249 ], have been considered by the Apex Court in K.A.Annamma's case supra [ (2018) 2 SCC 729 ]. Prior thereto, the matter was referred to a Larger Bench of 5 Judges of this Court in the case in Chirayinkeezhu Service Co-operative Bank Ltd. v. Santhosh, [ 2015 (4) KLT 163 (LB) = 2015 SCC Online Ker.27282].
Prior thereto, the matter was referred to a Larger Bench of 5 Judges of this Court in the case in Chirayinkeezhu Service Co-operative Bank Ltd. v. Santhosh, [ 2015 (4) KLT 163 (LB) = 2015 SCC Online Ker.27282]. The Larger Bench in Santhosh's case supra [ 2015 (4) KLT 163 (LB)] rendered its decision, wherein 3 Judges formed the majority opinion and 2 Judges rendered the minority view therein. The majority view of 3 Judges in Santhosh's case supra [ 2015 (4) KLT 163 (LB)] held that the service disputes arising between the employee of the co-operative society and the employer of the co-operative society is triable only by the forum prescribed under the KCS Act, 1969 and the jurisdiction of the ID Act is excluded and barred to try such service disputes. Whereas the minority opinion of 2 Judges in that case was to the effect that such service dispute was triable both under the KCS Act and the ID Act. In other words, it was held that both the Acts possess and enjoy concurrent jurisdiction to decide such service disputes and that it is for the aggrieved employee to choose the forum of his/her choice out of the two Acts to get the service disputes settled, subject to proving the ingredients of the definition of “workman” “industrial dispute” and that the co-operative society is an “industry” as defined under the ID Act if he/she desires to invoke the jurisdiction of the ID Act for deciding his/her service disputes. 35. It appears that the decision in K.Santhosh's case supra [ 2015 (4) KLT 163 (LB)] was not directly challenged in SLP proceedings before the Apex Court. An identical issue arose before the Apex Court, in respect of another employee dismissed from service by another co-operative society. The employee (K.A.Annamma) challenged the dismissal order of the employer therein (Cochin Co-operative Hospital Society Ltd.), which led to the Industrial Dispute reference to the Labour Court under Sec. 10 of the ID Act and the Labour Court had passed an award, holding that the dismissal order is bad in law and the same was set aside and since the appellant therein had attained the age of superannuation in the meanwhile, the Labour Court ordered that she was entitled to get all monetary and service benefits as permissible in law.
The award of the Labour Court was challenged by the employer, by instituting W.P.(C).No. 18354/2010 before this Court. Relying on the majority view of the Larger Bench decision in K.Santhosh's case supra [ 2015 (4) KLT 163 (LB)], the learned Single Judge allowed the writ plea of the employer resulting in setting aside of the award of the Labour Court. A reading of para 20 of the decision in K.A.Annamma's case supra [ (2018) 2 SCC 729 ] would indicate that thereafter Special Leave petition was preferred by the said employee before the Apex Court, which led to the rendering of the decision in K.A.Annamma's case supra [ (2018) 2 SCC 729 ]. 36. The Apex Court, after elaborate consideration of the issue and after placing reliance on yet another decision of the Apex Court in Dharappa v. Bijapur Co-op. Milk Products Society Union Ltd., [ (2007) 9 SCC 109 ], has categorically held, in para 67 thereof, that their Lordships of the Apex Court are of the considered opinion that the majority view of the Larger Bench in K.Santhosh's case supra [ 2015 (4) KLT 163 (LB)] cannot be upheld and that the view of the minority judges in K.Santhosh's case supra [ 2015 (4) KLT 163 (LB)] deserves to be upheld and was accordingly upheld. Thus, the Apex Court has categorically declared, in para 67 of K.A.Annamma's case supra [ (2018) 2 SCC 729 ], the position of law that the KCS Act and the ID Act both possess and enjoy concurrent jurisdiction to decide any service dispute arising between the employee of a co-operative society and the employer co-operative society concerned. Further, it was also declared, in para 68 of K.A.Annamma's case supra [ (2018) 2 SCC 729 ], that it is the choice of the employee concerned to choose any one forum out of the two fora available to him/her under the two Acts, viz., KCS Act and the ID Act, to get his /her service disputes decided. But that this would be subject to satisfying the test laid down under the ID Act that the employee concerned is a workman and the dispute raised by him/her is an industrial dispute and that the co-operative society (employer) is an industry as defined under the ID Act, 1947.
But that this would be subject to satisfying the test laid down under the ID Act that the employee concerned is a workman and the dispute raised by him/her is an industrial dispute and that the co-operative society (employer) is an industry as defined under the ID Act, 1947. In K.A.Annamma's case supra, [ (2018) 2 SCC 729 ], the Apex Court has noted its earlier decision in Dharappa's case supra, [ (2007) 9 SCC 109 ], which dealt with the provisions contained in the Karnataka Co-operate Societies Act and it was noted that the amendment of Sec. 70 of the Karnataka Act, which was made w.e.f. 20.6.2000 expressly barred the jurisdiction of the Civil, Labour, & Industrial Tribunal from deciding service disputes. It will be pertinent to refer to paras 67 and 68 of the decision in K.A.Annamma's case supra, [ (2018) 2 SCC 729 ], which read as follows: “67. In the light of the foregoing discussion, we are of the considered opinion that the view of majority Judges cannot be upheld whereas the view of the minority Judges in Santhosh case [Chirayinkeezhu Service Coop. Bank Ltd. v. K. Santhosh, 2015 SCC OnLine Ker 27282 : (2015) 4 KLT 163 ] deserves to be upheld and is accordingly upheld. We accordingly hold that the KCS Act and the ID Act both possess and enjoy the concurrent jurisdiction to decide any service dispute arising between the Co-operative society's employee and his/her employer (Co-operative society). 68. We also hold that it is the choice of the employee concerned to choose any one forum out of the two forums available to him/her under the two Acts (the KCS Act and the ID Act) to get his/her service dispute decided. It is, however, subject to satisfying the test laid down under the ID Act that the employee concerned is a “workman”, the dispute raised by him/her is an “industrial dispute” and the Co-operative society (employer) is an “industry” as defined under the ID Act.” 37. So, the issue as to the jurisdiction of the adjudicatory forum, under Sec.69 of the KCS Act viz., the Co-operative Arbitration Court, to entertain and decide on service disputes, as above, is no longer res integra and is covered by the dictum laid down by the Apex Court in K.A.Annamma's case supra [ 2018 (2) SCC 729 ].
So, the issue as to the jurisdiction of the adjudicatory forum, under Sec.69 of the KCS Act viz., the Co-operative Arbitration Court, to entertain and decide on service disputes, as above, is no longer res integra and is covered by the dictum laid down by the Apex Court in K.A.Annamma's case supra [ 2018 (2) SCC 729 ]. In other words, if the employee concerned is a “workman” within the meaning of the ID Act and the dispute raised would satisfy the definition of “Industrial dispute” and the Co-operative society employer is an “industry” as per the ID Act, etc. then, the choice is on the employee to opt for any one out of the two fora available to him/her, i.e., either under the KCS Act or under the ID Act. So, in a case of dismissal of an employee for misconduct, etc. there cannot be any dispute that the same would amount to industrial dispute and the employee is “workman” within the meaning of the ID Act. So also, there cannot be any dispute regarding the jurisdiction of the Co-operative Arbitration court to entertain service disputes in terms of Sec. 69 of the KCS Act. The issue is as to whether the Co-operative Arbitration Court has the power to order the relief of reinstatement in service, where the dismissal is found to be illegal or ultra vires, in view of the inhibition contained in Sec.41(e) read with the Sec. 14(c) of the Specific Relief Act, which is based on the general rule of non enforceability of specific performance of contract of personal service. Of course, there is no dispute that the Labour Court/Industrial Tribunal constituted under the ID Act has the discretionary power to order even the relief of reinstatement in appropriate cases, in view of the powers conferred on the said forum, more particularly, as per the provisions in Sec. 11 A of the ID Act. 38. It is by now well established that,in a case of termination from service, including dismissal for misconduct, etc.
38. It is by now well established that,in a case of termination from service, including dismissal for misconduct, etc. of an employee covered by a contract of personal service, in view of the restrictions contained in Sec. 14 (c) read with Sec. 41(e) of the Specific Relief Act, 1963, there will be a bar for enforcement of such contract of personal service and so, the civil court does not have jurisdiction to grant the relief of reinstatement, as it is considered that such relief would amount to enforcing a contract of personal service and that at best, the civil court, on finding that the dismissal is wrongful, can award damages and not reinstatement. Even in such a scenario, three exceptions have been culled out to the said bar of enforcement of specific performance of personal services, etc.: (i) in a case where a public servant/ Government servant has been dismissed from service, etc., in contravention of the mandate contained in Art.311 of the Constitution of India; (ii) In the case of an employee, who seeks adjudication before the Labour Court/Industrial Tribunal under the Industrial Disputes Act, where the said forum under the ID Act has the power to grant the relief of reinstatement; and (iii) where the employer is a statutory body and the employee is terminated from service in breach of the mandatory statutory obligations, then the court could order reinstatement in appropriate cases. The essential premise, in exceptions as in the first and third scenarios above is that in such a case, the civil court or the court concerned is not enforcing a contract of personal service, but that where the termination of service by way of dismissal, etc. is found to be made in contravention of a statutory mandate, then the very order of termination from service is found to be statutorily invalid and the said legal position is so declared and the employee is then put back to the prior position before the rendering of the statutorily invalid order of termination from service, etc. The premise in the second exception covered by the Labour Court and Industrial Tribunal as per the ID Act is that such a forum under the ID Act has got special powers as per the industrial law jurisprudence and as per the provisions contained in the ID Act, like Sec. 11A, etc.
The premise in the second exception covered by the Labour Court and Industrial Tribunal as per the ID Act is that such a forum under the ID Act has got special powers as per the industrial law jurisprudence and as per the provisions contained in the ID Act, like Sec. 11A, etc. We would now deal with various case laws on such matters. High Commissioner for India & High Commissioner for Pakistan v. I.M.Lall ( AIR 1948 PC 121 = 1948 Federal Court Reports 44 Privy Council) by Lord Thankerton 39. The respondent therein was the member of the Indian Civil Service (ICS) and he was removed as per order dated 10.8.1940, whereby he was ordered to be removed from the Indian Civil Service by the order of the Secretary of State for India. The respondent filed a civil suit, initially before the subordinate court at Lahore and later it was transferred to the High Court concerned and was heard by the Division Bench of the High Court, as a court of first instance. After trial, the High Court granted the decree in favour of the respondent therein (plaintiff) to the extent of granting a declaration that the order, removing the respondent from office, was wrongful, void, illegal and inoperative and that he was still a member of the ICS. The matter was entertained in appeal by the Federal Court, which, by a majority, varied the decree of the High Court by ordering that, in the place of the declaration that the order removing the plaintiff from office was wrongful, void, illegal and inoperative, etc. it shall be substituted by an order declaring that the plaintiff was wrongfully dismissed from the ICS and the Federal Court remitted the original suit to High Court to take such action, in regard to any application by the respondent therein, for leave to amend the claimed damages and to the assessment of such damages, etc. 40. Earlier, the Government of India Act, 1919 governed the field. However, later the Government of India Act, 1935 came into force and the impugned dismissal from service in that case was rendered on 10.8.1940, at a time when the Government of India Act, 1935 was in force. 41.
40. Earlier, the Government of India Act, 1919 governed the field. However, later the Government of India Act, 1935 came into force and the impugned dismissal from service in that case was rendered on 10.8.1940, at a time when the Government of India Act, 1935 was in force. 41. Sec. 240 of the Government of India Act, (GOI Act) 1935, as noted in pages 57 and 58 of the afore Federal Court Report, reads as follows: “Sec.420 (1) Except as expressly provided by this Act, every person who is a member of a civil service of the Crown in India or holds any civil post under the Crown in India, holds office during His Majesty's pleasure. (2) No such person as aforesaid shall be dismissed from the service of His Majesty by any authority subordinate to that by which he was appointed. (3) No such person as aforesaid shall be dismissed or reduced in rank until he has been given a reasonable opportunity of showing cause against the action proposed to be taken in regard to him: Provided that this sub-section shall not apply (a) where a person is dismissed or reduced in rank on the ground of conduct which has led to his conviction on a criminal charge, or (b) where an authority empowered to dismiss a person or reduce him in rank is satisfied that for some reason, to be recorded by that authority in writing, it is not reasonably practicable to give to that person an opportunity of showing cause. (4) Notwithstanding that a person holding a civil post under the Crown in India holds office during His Majesty's pleasure, any contract under which a person, not being a member of a Civil service of the Crown in India, is appointed under this Act to hold such a post may, if the Governor- General, or, as the case may be, the Governor, deems it necessary in order to secure the service of a person having special qualifications, provide for the payment to him of compensation if before the expiration of an agreed period that post is abolished or he is, for reasons not connected with any misconduct on his part, required to vacate that post.” The afore Sec. 240 of the Government of India Act, (GOI Act) 1935, is broadly analogous to the corresponding provisions contained in Art.311 (2) of the Constitution of India.
Therein it is mandated that, no member of the civil service or holder of civil post shall be dismissed or removed or reduced in rank until he has been given a reasonable opportunity of showing cause against the action proposed to be taken, etc. The judicial committee of the Privy Council held therein that the person,who is to be dismissed or reduced in rank must know that the punishment is proposed for certain acts or omissions on his part and must be told the grounds on which it is proposed to take such action and must be given a reasonable opportunity of showing cause as to why such punishment shall not be imposed. The judicial committee found therein that the impugned removal of the plaintiff therein was in breach and contravention of the statutory mandate contained in Sec. 240(3) of the Government of India Act, 1935. Hence, it was declared that the purported dismissal/ removal of the plaintiff therein was void and inoperative and that therefore he remained a member of the ICS, as on the date of institution of the civil suit on 2oth July, 1942, etc. Incidentally, the judicial committee in I.M.Lall's case supra ( AIR 1948 PC 121 ) has also noted two of their previous decisions rendered on 8.12.1936, one in R.T.Rangachari vs. The Secretary of State for India in Council (ILR 1937 Mad. 517 = AIR 1937 PC 27 ) and the other in R.Venkata Rao vs. Secretary of State for India in Council [ AIR 1937 PC 31 : 1937 ILR Mad. 532(PC)]. Both those cases arose out of the issues as to the provisions contained in the earlier Government of India Act, 1919, as it was rendered prior to the coming into force of the GOI Act, 1935. Both those cases considered the impact of Sec. 96B of the GOI Act, 1919. The relevant portion of Sec.96B of the above Act reads as follows: “Sec.96B.
Both those cases considered the impact of Sec. 96B of the GOI Act, 1919. The relevant portion of Sec.96B of the above Act reads as follows: “Sec.96B. (1) Subject to the provisions of this Act and of rules made thereunder, every person in the civil service of the Crown in India holds office during His Majesty's pleasure, and may be employed in any manner required by a proper authority within the scope of his duty, but no person in that service may be dismissed by any authority subordinate to that by which he was appointed, and the Secretary of State in Council may (except so far as he may provide by rules to the contrary) reinstate any person in that service who has been dismissed....” 42. Lord Roche, speaking for the Judicial Committee of the Privy Council found in R.T. Rangachari's case supra [1937 ILR Madras 517 (PC) = AIR 1937 PC 27 ] that the impugned dismissal of the civil servant in that case, by an authority subordinate to that, by which he was appointed, was contrary to the mandate contained in Sec. 96B(1) of the GOI Act, 1919, and hence, bad and inoperative. The Privy Council held therein that it is manifest that the stipulation or proviso as to dismissal is itself of statutory force and stands on a footing quite different from matters of rule which are of infinite variety and can be changed from time to time. So it can be seen that the conventional approach taken in old decisions as in R.T.Rangachari's case supra ( AIR 1937 PC 27 ), I.M.Lall's case supra ( AIR 1948 PC 121 ), etc. was that the order of termination from service, by way of dismissal, etc., can be held to be statutorily invalid and thus, inoperative and ultra vires, only if the mandate contained in a parent enactment, like the Govt. of India Act, etc. is violated and not in a case, where there is no violation of the provisions contained in the parent enactment, like Sec.240 of the Government of India Act, 1935, Sec.96B of GOI Act, 1919, but what was involved is only violation of the provisions contained in the Rules framed as subordinate legislation under the parent enactment.
of India Act, etc. is violated and not in a case, where there is no violation of the provisions contained in the parent enactment, like Sec.240 of the Government of India Act, 1935, Sec.96B of GOI Act, 1919, but what was involved is only violation of the provisions contained in the Rules framed as subordinate legislation under the parent enactment. The approach then was that to hold that there is a breach or a contravention of the statutory mandate, a provision contained in the parent enactment should be contravened and so long as there is no breach of the Act of the Legislature, what is involved is only a violation of the rule framed as subordinate legislation under the parent enactment, then it cannot be treated as a contravention to the statutory mandate. The perspective then taken was that the breach or contravention of the provision of the Act of the Legislature would be quite different from matters of violation of a rule, which can be changed from time to time. So, in I.M.Lall's case supra ( AIR 1948 PC 121 ) and R.T.Rangachari's case supra ( AIR 1937 PC 27 ), it was found that violation of the provisions, contained in Sec. 240(3) of the GOI Act, 1935 and Sec. 96(B)(1) of the GOI Act, 1919, would lead to the situation of contravention of the statutory mandate and hence, would make such orders inoperative and void, whereas in R.Venkata Rao's case supra [ AIR 1937 PC 31 : 1937 ILR Mad. 532] it was held that there was no violation of any provisions of the parent enactment, and what was established was only a violation of the provisions contained in the rule. 43. We would see, from the subsequent discussion of case laws, that the said perspective has been given a go-bye in various decisions of the Apex Court, especially in the 5-Judge Bench decision in Sirsi Municipality v. Cecelia Kom Francis Tellis [ (1973) 1 SCC 409 ] as well as the decision of the Constitution Bench of the 5-Judges of the Apex Court in the celebrated case in Sukhdev Singh & Ors.
v. Bhagatram Sardar Singh Raghuvanshi & Anr., (1975) 1 SCC 421 , wherein it has been categorically held that the provisions in statutory rules framed under an Act, will also have statutory force and that violation of the said statutory mandate would lead to a scenario of statutory invalidity and ultra vires. As a matter of fact, in this context it may be relevant to note that the 3-Judge Bench of the Apex Court in S.R.Tewari v. District Board, Agra, ( AIR 1964 SC 1680 ) has observed in para No.6 thereof that though the civil court has no jurisdiction to force an employer to retain the services of a servant, whom he no longer wishes to employ and every employer is entitled to discharge a servant for whose service he has no need and it must be pointed out that powers of a statutory body are always subject to the statute which has constituted it, and must be exercised consistently with the statute, and the Courts have, in appropriate cases, the power to declare an action of the body illegal or ultra vires, even if the action relates to determination of employment of a servant. S.R.Tewari v. District Board, Agra ( AIR 1964 SC 1680 ):- 44. It has been held in para 5 of the above decision that under 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 and that it is open to the courts in appropriate cases to declare that a Government servant, who is dismissed from service, in contravention of Art.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. So also, under the Industrial law, jurisdiction of the Labour Court and the Industrial Tribunal could be invoked to compel the employer to employ a worker, whom he does not desire to employ, if grounds are made out.
So also, under the Industrial law, jurisdiction of the Labour Court and the Industrial Tribunal could be invoked to compel the employer to employ a worker, whom he does not desire to employ, if grounds are made out. Further that, the third category of cases was that the courts are also invested with the power to declare invalid the act of a statutory body, if by doing the act of dismissal etc., the body has acted in breach of a mandatory obligation imposed by a statute, even if by making the declaration, the body is compelled to do something which it does not desire to do. Further, it has also been categorically held by the Apex Court, in para 6 thereof, that the powers of a statutory body are always subject to the statute, which has constituted it, and must be exercised consistently with the statute, and the Courts have, in appropriate cases, the power to declare an action of the body illegal or ultra vires, even if the action relates to determination of employment of a servant. The said case concerned an employee of the District Board, Agra, which was constituted as per the Uttar Pradesh District Boards Act, 1922. Sec.82 of the District Board's Act empowered the Board to appoint and to determine the employment of an engineer of the Board, unless the determination was by way of punishment, it could be made in the manner provided by Rule 3A Cl. (iv), after giving notice of three months or a sum equal to the salary for three months, in lieu of notice. Therein, an engineer of the District Board was terminated from service, in accordance with Rule 3A(iv) supra. The Apex Court held, on facts, that the termination of service in that case was by taking recourse to Rule 3A(iv) by giving the requisite notice, etc. and that it was never contended that the order, terminating the employment, was one, in reality, of the nature of dismissal as punishment. Mafatlal Narandas Barot v. J.D.Rathod, Divisional Controller, State Transport Department ( AIR 1966 SC 1364 ):- 45. The above decision is rendered by a Constitution Bench of the Apex Court, which concerned the employee of the Gujarat State Road Transport Corporation, which is an autonomous statutory corporation, formed under the provisions of the Road Transport Corporations Act, 1950.
Mafatlal Narandas Barot v. J.D.Rathod, Divisional Controller, State Transport Department ( AIR 1966 SC 1364 ):- 45. The above decision is rendered by a Constitution Bench of the Apex Court, which concerned the employee of the Gujarat State Road Transport Corporation, which is an autonomous statutory corporation, formed under the provisions of the Road Transport Corporations Act, 1950. It was noted therein that as the employee being not a Government servant, could not invoke the protection of Art.311 of the Constitution of India. Regulation 4(b) of the Regulations, framed under the above Act, mandated that a person against whom an action is proposed to be taken for any act of misconduct shall be provided with a copy of the charges as well as statement of allegations that has been made against him and over which enquiry is being held, etc. The Apex Court found that the order of termination, imposed on the appellant employee therein, is bad in law, since it contravenes the provisions contained in Regulation 4(b) and also the principles of natural justice. Hence, the impugned order of termination from service was quashed, but with liberty to the respondent authority to make a fresh disciplinary enquiry against the appellant, after affording him reasonable opportunity to show cause as mandated in Regulation 4(b) supra. The above case is a landmark decision of the Constitution Bench of 5-Judges of the Apex Court, wherein it was held that where a statutory corporation contravenes the mandatory provisions of the Regulations framed under the Act, in effecting an order of termination from service of an employee, then the same would be statutorily invalid. Prabhakar Ramkrishna Jodh v. A.L.Pande & Anr. [ (1965) 2 SCR 713 ]:- 46. The above decision has been rendered by a Bench of 4 Judges of the Apex Court. The appellant therein was appointed as a Lecturer in a private college affiliated to the University of Saugar, which was regulated by the University of Saugar Act, 1946 and the private college was managed by a governing body, established under Clause 3 of the College Code, which is an Ordinance made under the provisions of the said Act. On issuance of memo of charges, the appellant had submitted an explanation thereto, denying all the charges, and requested the governing body to supply particulars on which the first charge was based. The governing body terminated the services of the appellant therein.
On issuance of memo of charges, the appellant had submitted an explanation thereto, denying all the charges, and requested the governing body to supply particulars on which the first charge was based. The governing body terminated the services of the appellant therein. The appellant challenged the said impugned action by writ proceedings, instituted before the Madhya Pradesh High Court. He urged that the governing body of the college had made the order of termination from service in violation of the provisions contained in Clause 8(vi)(a) of the College Code and therefore, the order of the governing body was ultra vires and illegal. The High Court rejected the contention of the appellant on the ground that the conditions of service of the appellant were governed, not by the College Code, but by the contract made between the governing body of the college and the appellant. The matter was taken up to the Apex Court and it was held therein that the College Code is an Ordinance framed under the provisions of Sec.32 of the Act read with Sec. 6(6) of the Act and Clause 8 of the Ordinance dealt with the conditions of service of affiliated colleges, which has inter alia stipulated that the governing body of the college shall not terminate the service or reduce the pay of a teacher confirmed in service without holding a full enquiry in the matter, wherein the teacher shall be given in writing, a statement of charges against him and afforded every possible opportunity of defending himself and that no such order of termination from service or reduction of pay shall have effect unless passed by a majority of two-thirds of the members of the governing body and that, at the request of the teacher concerned, any difference or dispute, either arising out of the contract, or, otherwise, shall be referred to a Tribunal of Arbitration, consisting of the functionaries mentioned therein and the decision of the Tribunal was to be final and binding on both sides, etc. 47. The Apex Court held in para 5 thereof that the provisions of Ordinance 20 or the "College Code" have the force of law and it confers legal rights on the teachers of the affiliated colleges and it is not a correct proposition to say that the "College Code" merely regulates the legal relationship between the affiliated colleges and the University alone.
It was held therein that the provisions of the "College Code" relating to the pay scale of teachers and their security of tenure would properly fall within the statutory power of affiliation granted to the University under the Act. Further, it was held that, though clause 7 of the Ordinance provides that all teachers of affiliated colleges shall be appointed on a written contract, in the form prescribed in Schedule A, that does not mean that teachers have merely a contractual remedy against the Governing Body of the College. That on the other hand, their Lordships of the Apex Court had taken the categorical view that the provisions of clause 8 of the College Code, relating to security of the tenure of teachers are part and parcel of the teachers' service conditions and, that the College Code has been validly made by the University, in exercise of the statutory power and therefore, have the force and effect of law and the College Code thus creates legal rights, in favour of teachers of affiliated colleges and the view taken by the High Court was held to be erroneous. On the factual plea raised by the college that there was no violation of the procedure prescribed under Clause 8(vi)(a) of the College Code, the Apex Court noted that the said factual question was not investigated by the High Court and hence the matter was remitted to the High Court for deciding the said question of fact whether there was any violation of procedure prescribed under Clause 8(vi)(a) of the College Code and whether the order of the governing body, terminating the service of the appellant, is consequently illegal and ultra vires, etc. In para 7 of the decision in P.R.Jodh's case supra [ (1965) 2 SCR 713 ] the Apex Court has observed that the college management had raised yet another plea that the governing body of the college was not a statutory body performing public duties, etc. However, the Apex Court has clearly held in para 7 thereof that it is conceded by the respondent college authorities therein that these objections, that the governing body of the college was not a statutory body, was not pressed before the High Court and that therefore, the Apex Court was unable to entertain those preliminary arguments at that stage and was overruled.
Hence, it can be noted that the Apex Court had not held therein as to whether the governing body of the college was a statutory body or non statutory body. However, the legal position has been categorically declared by the 4-Judge Bench of the Apex Court in para 5 of P.R. Jodh's case supra [ (1965) 2 SCR 713 ], which reads as follows: “5. It is not disputed on behalf of the respondents that the “College Code” has been made by the University in exercise of statutory power conferred by Section 32 and under Section 6(6) of the Act. It is also conceded on behalf of the respondents that the “College Code” is intra vires of the powers of the University contained in Section 32 read with Section 6(6) of the Act. In our opinion, the provisions of Ordinance 20, otherwise called the “College Code” have the force of law. It confers legal rights on the teachers of the affiliated colleges and it is not a correct proposition to say that the “College Code” merely regulates the legal relationship between the affiliated colleges and the University alone. We do not agree with the High Court that the provisions of the “College Code” constitute power of management. On the contrary we are of the view that the provisions of the “College Code” relating to the pay scale of teachers and their security of tenure properly fall within the statutory power of affiliation granted to the University under the Act. It is true that clause 7 of the Ordinance provides that all teachers of affiliated colleges shall be appointed on a written contract in the form prescribed in Schedule A but that does not mean that teachers have merely a contractual remedy against the Governing Body of the College. On the other hand, we are of opinion that the provisions of clause 8 of the Ordinance relating to security of the tenure of teachers are part and parcel of the teachers, service conditions and, as we have already pointed out, the provisions of the “College Code” in this regard are validly made by the University in exercise of the statutory power and have, therefore, the force and effect of law. It follows, therefore, that the “College Code” creates legal rights in favour of teachers of affiliated colleges and the view taken by the High Court is erroneous.” 48.
It follows, therefore, that the “College Code” creates legal rights in favour of teachers of affiliated colleges and the view taken by the High Court is erroneous.” 48. The various aspects, emanating from the 4-Judge Bench decision in P.R. Jodh's case supra [ (1965) 2 SCR 713 ] and that in the 3-Judge Bench in Shri Vidya Ram Misra's case [ (1972) 1 SCC 623 ] has been considered in detail by a Full Bench of this Court in John Kuriakose v. State of Kerala [ 2015 (1) KLT 720 (F.B.)] (see para Nos.20, 21, 22, 23 and 24). It can thus be seen from para 7 of the decision in P.R. Jodh's case supra [ (1965) 2 SCR 713 ] that the Apex Court has not decided therein as to whether the governing body of the college therein was a statutory body or a non statutory body, but has laid down the position of law in para 5 thereof quoted above, which has also been explained and affirmed in the latter part of para 9 of Shri Vidya Ram Misra's case [ (1972) 1 SCC 623 ]. Sirsi Municipality v. Cecelia Kom Francis Tellis [ (1973) 1 SCC 409 ] 49. This decision has been rendered by a Five Judges' Constitution Bench of the Apex Court, which concerned the dismissal order imposed on a mid-wife of a municipal hospital, administered by the Sirsi Municipality. Sec.46 of the Bombay District Municipalities Act, 1901 mandated that the municipality shall make rules in respect of matters enumerated in that provision and clause (g) of Sec. 46 empowered the municipality to inter alia frame rules, regulating the period of service, conditions of service, etc. Rule 143, more particularly sub-rule (1), provided that no officer or servant shall be dismissed without a reasonable opportunity being given to him of being heard in his defense and any written defense tendered shall be recorded and the written order shall be passed thereon and sub-rule (2) thereof further mandated that every order of dismissal or confirming dismissal shall be in writing and shall specify the charge or charges brought, the defense and the reasons for the order [see paras 3 & 5 of Sirsi Municipality's case supra [ (1973) 1 SCC 409 ]. 50.
50. The lady patient concerned therein was admitted to the maternity section and she later died and it was alleged that her death was caused due to the alleged negligence of the staff of the municipal hospital concerned. On the basis of certain reports of a Committee, the President of the Municipal Council send a notice to the respondent therein, who was then working as a midwife in that hospital, that the death of the lady patient in the maternity section occurred due to the negligence of the respondent. She was given notice to appear before the Municipal Council and she sent a reply denying her negligence. Later, the respondent insisted that the charges against her be given in writing and that she would reply in writing. The municipality did not accede to her request. The Municipal Council had passed a resolution dismissing her from service. 51. Later, the respondent therein filed a civil suit for a declaration that the dismissal by the appellant-Sirsi Municipality was illegal and void, on the ground that the dismissal order was rendered in contravention of the statutory mandate, contained in Rule 143 supra, framed under Sec.46(1) of the Bombay District Municipalities Act, 1901. A declaration was also sought that her status as midwife in the municipal hospital remained unaffected and that the respondent was an employee of the municipality as before [see paras 7 to 11 of the SCC report supra]. 52. Ultimately, the High Court upheld the findings of the Trial Court and the first Appellate Court that the respondent-employee was not given a reasonable opportunity of defending herself against the charge on which she was dismissed and the municipality thus, acted in contravention of the statutory mandate contained in Rule 143 supra. The High Court found that the resolution of the municipality dismissing her, was clearly in violation of Rule 143 and declared it as invalid and inoperative and also declared that the respondent was deemed to have continued in service, from the date of dismissal to the date of the suit. The matter was taken up before the Apex Court, where the contention of the appellant-Municipality was that the rules and bye-laws of the municipality were only for the guidance of the municipality and that the respondent could not challenge the resolution or action of the municipality on the ground of contravention of rules and byelaws.
The matter was taken up before the Apex Court, where the contention of the appellant-Municipality was that the rules and bye-laws of the municipality were only for the guidance of the municipality and that the respondent could not challenge the resolution or action of the municipality on the ground of contravention of rules and byelaws. The Apex Court in Sirsi Municipality's case supra [ (1973) 1 SCC 409 ], in para 15 thereof, held that cases of dismissal of a servant fall under three broad heads and the first head relates to relationship of master and servant, governed purely by contract of employment and any breach of contract in such a case is enforced by a suit only for wrongful dismissal and damages. That, just as a contract of employment is not capable of specific performance, similarly a breach of contract of employment is not capable of finding a declaratory judgment of subsistence of employment and a declaration of unlawful termination and restoration to service, in such a case of contract of employment, would be indirectly an instance of specific performance of contract for personal service and such a declaration is not permissible, in view of the bar contained in the Specific Relief Act (SR Act). 53. In para 16 thereof, the Apex Court held that the second type of cases of master and servant arises under the Industrial laws, whereunder a workman, who is wrongfully dismissed, could be reinstated and this is a special provision under the Industrial laws and this relief is a departure from the reliefs available under the Indian Contract Act and the Specific Relief Act, which do not provide for reinstatement of a servant. 54. In para 17 thereof, the Apex Court held that there is a third category of cases of master and servant, which arises in regard to the servant in the employment of the State or of other public or local authorities or bodies created under statute. 55. In para 18 thereof, it was held that termination or dismissal of what is described as a pure contract of master and servant is not declared to be a nullity, however wrongful or illegal it may be. The reason being that dismissal, in breach of contract, is remedied by damages.
55. In para 18 thereof, it was held that termination or dismissal of what is described as a pure contract of master and servant is not declared to be a nullity, however wrongful or illegal it may be. The reason being that dismissal, in breach of contract, is remedied by damages. But that, in the case of employees of the State or of local authorities or statutory bodies, the courts have declared, in appropriate cases, the dismissal to be invalid, if the dismissal is contrary to the rules of natural justice or if the dismissal is in violation of the provisions of the statute. Very clearly it was further held that, apart from the intervention of statutes, there would not be a declaration of nullity, in the case of termination or dismissal of a servant of the State or of other local authorities or statutory bodies. Paras 15 to 18 of Sirsi Municipality's case supra [ (1973) 1 SCC 409 ], read as follows : “15. The cases of dismissal of a servant fall under three broad heads. The first head relates to relationship of master and servant governed 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 finding a declaratory judgment of subsistence of employment. A declaration of unlawful termination and restoration to service in such a case of contract of employment would be indirectly an instance of specific performance of contract for personal services. Such a declaration is not permissible under the Law of Specific Relief Act. 16. 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 reliefs available under the Indian Contract Act and the Specific Relief Act which do not provide for reinstatement of a servant. 17. 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. 18.
17. 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. 18. Termination or dismissal of what is described as a pure contract of master and servant is not declared to be a nullity however wrongful or illegal it may be. The reason is that dismissal in breach of contract is remedied by damages. It the case of servant of the State or of local authorities or statutory bodies, courts have declared in appropriate cases the dismissal to be invalid if the dismissal is contrary to rules of natural justice or if the dismissal is in violation of the provisions of the statute. Apart from the intervention of statute there would not be a declaration of nullity in the case of termination or dismissal of a servant of the State or of other local authorities or statutory bodies.” 56. The bar under the Specific Relief Act in a civil court granting specific performance of a contract of personal service and the three exceptions thereto, as dealt with in various judgments, have also been considered in detail in the subsequent paragraphs in Sirsi Municipality's case supra [ (1973) 1 SCC 409 ]. Some of the decisions referred to therein are the cases in Executive Committee of U.P Warehousing Corporation v. Chandra Kiran Tyagi [ 1969 (2) SCC 838 ], Indian Airlines Corporation v. Sukhdeo Rai [ (1971) 2 SCC 192 ], etc., wherein it was held that dismissal of employees of those statutory corporations, in violation of the regulations framed under the Act by the employer-Corporation, may not give a right of action for declaration that the dismissal order is statutorily invalid, etc. However, in para 24 of Sirsi Municipality's case supra [ (1973) 1 SCC 409 ], the Apex Court has referred to various other decisions, in cases as in S.R Tewari v. The District Board, Agra & Anr. [ AIR 1964 SC 1680 ], Life Insurance Corporation of India & Ors. v. Sunil Kumar Mukherjee & Ors. [ AIR 1964 SC 847 ], Calcutta Dock Labour Board v. Jaffar Imam & Ors. [ AIR 1966 SC 282 ], Mafatlal Narandas Barot vs. J D Rathod, Divisional Controller, State Transport Mehsana & Anr.
[ AIR 1964 SC 1680 ], Life Insurance Corporation of India & Ors. v. Sunil Kumar Mukherjee & Ors. [ AIR 1964 SC 847 ], Calcutta Dock Labour Board v. Jaffar Imam & Ors. [ AIR 1966 SC 282 ], Mafatlal Narandas Barot vs. J D Rathod, Divisional Controller, State Transport Mehsana & Anr. [ AIR 1966 SC 1364 ], which dealt with the power of statutory authorities and bodies to dismiss employees. It was held therein that those decisions established the position that the dismissal of a servant by statutory, including competent local authorities or bodies, in breach of the provisions of the statutes or orders or schemes made under the statute, which regulate the exercise of their power, is invalid or ultra vires and the principle of pure master and servant contractual relationship has no application in such cases. 57. Various English decisions, as in Vine v. National Dock Labour Board [(1956) 3 All ER 939], Barber v. Manchester Regional Hospital Board & Anr. [(1958) 1 All ER 322], Ridge v. Baldwin [1964 AC 40], Malloch v. Aberdeen Corporation [(1971) 2 All ER 1278], McClelland v. Northern Ireland General Health Services Board [(1957) 1 WLR 594], are also referred to in para 28 of Sirsi Municipality's case supra [ (1973) 1 SCC 409 ]. The Apex Court has categorically held in para 29 thereof, that those decision supra indicate that statutory provisions may limit the power of dismissal and where such limitation is disregarded, a dismissal may be held invalid and in this respect, employment under statutory bodies differs from ordinary private employment and where a public body is empowered to terminate employment, on specified grounds, or where a public body does not observe the procedure laid down by legislation, e.g. improperly delegates power of dismissal to another body, etc., the courts have declared such dismissal from public employment to be statutorily invalid. It was also observed in para 30 thereof, that the cases of statutory status of an employee can also form the subject matter of protection of rights of an employee under the statute. Paras 29 & 30 of Sirsi Municipality's case supra [ (1973) 1 SCC 409 ] read as follows : “29. These decisions indicate that statutory provisions may limit the power of dismissal. Where such limitation is disregarded a dismissal may be held invalid.
Paras 29 & 30 of Sirsi Municipality's case supra [ (1973) 1 SCC 409 ] read as follows : “29. These decisions indicate that statutory provisions may limit the power of dismissal. Where such limitation is disregarded a dismissal may be held invalid. In this respect employment under statutory bodies differs from ordinary private employment. Where a public body is empowered to terminate employment on specified grounds or where a public body does not observe the procedure laid down by legislation, e.g. improperly delegates power of dismissal to another body the courts have declared such dismissal from public employment to be invalid. 30. The cases of a statutory status of an employee can also form the subject-matter of protection of the rights of an employee under the statute. In Vine case, the removal of Vine's name from the register was held to be a nullity. The statutory scheme of employment was held to confer on the worker a status. An unlawful act of the Board was found to be interference with status. The status of the dock worker was recognised by this Court in Jaffar Imam case. In Jaffar Imam case, the termination of the employment in breach of Clause 36(3) of the scheme made by the Central Government in exercise of the power conferred on it by Section 4(1) of the Dock Workers (Regulation of Employment) Act, 1948 was held to be bad. The ground given by this court was that before any disciplinary action was taken under clause 36(1) and (2) of the scheme in Jaffar Imam case, the person concerned was to be given an opportunity to show cause as to why the proposed action should not be taken against him.” 58. Ultimately, the Constitution Bench in para 32 of Sirsi Municipality's case supra [ (1973) 1 SCC 409 ], has held that the pre-eminent question is whether the dismissal is in violation of the Rule framed by the municipality and whether Rule 143 imposes a mandatory obligation. In answer thereof, the Apex Court has held therein that the said rules were made in exercise of the power conferred on the municipality by statute and that the rules are binding on the municipality and they cannot be amended without the assent of the State Government.
In answer thereof, the Apex Court has held therein that the said rules were made in exercise of the power conferred on the municipality by statute and that the rules are binding on the municipality and they cannot be amended without the assent of the State Government. Further that, the dismissal of the respondent was rightly found by the High Court to be in violation of Rule 143, which imposed a mandatory obligation and the respondent-employee was dismissed without a reasonable opportunity of being heard in her defense and that the dismissal by the municipality was without recording any written statement, which might have been tendered and the dismissal by the municipality was without written order, as mandated in the rules and that, for all these reasons, the impugned dismissal, inflicted on her, was held to be ultra vires. Hence, it was further declared therein in para 33 thereof that the High Court was right in declaring the dismissal of the respondent to be illegal and void and that the appeal is therefore, dismissed. Paras 32 & 33 of Sirsi Municipality's case supra [ (1973) 1 SCC 409 ], read as follows : “32. In the present appeal, the pre-eminent question is whether the dismissal is in violation of Rule 143. Rule 143 imposes a mandatory obligation. The rules were made in exercise of power conferred on the municipality by statute. The rules are binding on the municipality. They cannot be amended without the assent of the State Government. The dismissal of the respondent was rightly found by the High Court to be in violation of Rule 143 which imposed a mandatory obligation. The respondent was dismissed without a reasonable opportunity of being heard in her defence. The dismissal by the municipality was without recording any written statement which might have been tendered. The dismissal by the municipality was without written order. The dismissal was ultra vires. 33. For the foregoing reasons the High Court was correct in declaring the dismissal of the respondent to be illegal and void. The appeal is therefore dismissed. In view of the fact that this Court directed the appellant would in any event pay the respondents costs, the respondent will be paid these costs.” 59.
The dismissal was ultra vires. 33. For the foregoing reasons the High Court was correct in declaring the dismissal of the respondent to be illegal and void. The appeal is therefore dismissed. In view of the fact that this Court directed the appellant would in any event pay the respondents costs, the respondent will be paid these costs.” 59. The majority judgment in Sirsi Municipality's case supra [ (1973) 1 SCC 409 ] was rendered on behalf of Four Judges out of the Five learned Judges of the Constitution Bench. A concurring judgment was also pronounced in that case and the learned Judge has fully concurred with the majority judgment. The aforecited judgments in Indian Airlines Corporation v. Sukhdeo Rai [ (1971) 2 SCC 192 ] & Executive Committee of U P Warehousing Corporation v. Chandra Kiran Tyagi [ (1969) 2 SCC 838 ], have been seriously critiqued in para 42 of the concurring judgment. It was held that the Court is unable to reconcile the decision in C.K.Tyagi's case supra as well as in Sirsi Municipality's case supra [ (1973) 1 SCC 409 ], wherein no express provision in the enactment was contravened by the impugned dismissal, but a rule, made under powers conferred by the statute (enactment), which protects the employee concerned from punishment, by way of dismissal, contrary to the rules of natural justice, was violated and that if a guaranteed “statutory status” means only an express statutory protection, such as the one found in Article 311 of the Constitution of India, and a rule made under a statutory power is not enough to confer it, there was none either in C.K.Tyagi's case supra or in Sirsi Municipality's case supra [ (1973) 1 SCC 409 ]. Further, it was held that an express statutory provision or guarantee is not the only basis of a mandatory duty or obligation and such a mandatory obligation can be imposed either by a rule made in exercise of a statutory power or it may arise by implication when exercising a quasi-judicial function. It may be pertinent to refer to para 42 of the concurring judgment in Sirsi Municipality's case supra [ (1973) 1 SCC 409 ], which reads as follows : “42.
It may be pertinent to refer to para 42 of the concurring judgment in Sirsi Municipality's case supra [ (1973) 1 SCC 409 ], which reads as follows : “42. Although Indian Airlines Corporation v. Sukhdeo Rai [ (1971) 2 SCC 192 : 1971 Supp SCR 510] which was cited on behalf of the appellant, could perhaps be distinguished on facts, I am unable to reconcile the decision of this Court in the case of Executive Committee of U.P. State Warehousing Corporation Ltd. v. Chandra Kiran Tyagi [ (1969) 2 SCC 838 : (1970) 2 SCR 250 ] , with our view in the case before us. In Tyagi case, as in the case before us, no express statutory provision was contravened by the impugned dismissal, but a rule, made under powers conferred by statute, which protects the servant concerned from punishment by way of dismissal contrary to rules of natural justice, was violated. If a guaranteed “statutory status” means only an express statutory protection, such as the one found in Article 311 of the Constitution, and a rule made under a statutory power is not enough to confer it, there was none either in Tyagi case, or in the case before us. An express statutory provision or guarantee is not the only basis of a mandatory duty or obligation. It can be imposed either by a rule made in exercise of a statutory power or it may arise by implication when exercising a quasi-judical function.” 60. Sirsi Municipality's case supra [ (1973) 1 SCC 409 ] is a landmark judgment of the Constitution Bench of the Apex Court, which has categorically held that, even violation of a rule framed by the employer municipality under the Municipalities Act, in effecting the dismissal of a municipal employee, would amount to statutory contravention and that it would render the dismissal order statutorily invalid and void and that such cases would lead to the declaration of statutory invalidity and ultra vires and the inoperativeness of the dismissal order and that the employee would be deemed to have continued in service from the day of dismissal, etc., was granted. It is also relevant to note that Sirsi Municipality's case supra [ (1973) 1 SCC 409 ] arose out of civil suit proceedings and the subsequent civil appellate proceedings arising therefrom. 61.
It is also relevant to note that Sirsi Municipality's case supra [ (1973) 1 SCC 409 ] arose out of civil suit proceedings and the subsequent civil appellate proceedings arising therefrom. 61. Further, it is also relevant to note that, it has been held, in para 47 of the concurring judgment in Sirsi Municipality's case supra [ (1973) 1 SCC 409 ] that, since the case involved dismissal for misconduct, casting serious stigma on the affected employee, it cannot be a case in which mere damages for a simple breach of contract could afford adequate relief and that damages could not wipe off the stigma attached to the record of the employee and that therefore, in such cases the law requires that, before the future of a servant is allowed to be marred by a blot on the record of the employee concerned, rules of natural justice must be complied with. Hence, it was ordered that the decision to dismiss the respondent employee therein, was void and inoperative for contravention of the statutory mandate and therefore, there seem to be no reason why a declaration to that effect be not granted. Para 47 of Sirsi Municipality's case supra [ (1973) 1 SCC 409 ], reads as follows: “47. If the decision to dismiss the respondent was void and inoperative in law, there seems no reason why a declaration to that effect be not granted. Such a case would be covered by the principles laid down by this court in: Life Insurance Corporation of India v. Sunil Kumar Mukherjee [ AIR 1964 SC 847 : (1964) 5 SCR 52 : (1964) 1 SCJ 275] and S.R. Tewari v. District Board Agra. [ AIR 1964 SC 1680 : (1964) 3 SCR 55 : (1964) 2 SCJ 300 ]. This could not be a case in which damages for a simple breach of contract could afford adequate relief. Damages could not wipe off the stigma attached to the record of the servant. The law requires that, before the future of a servant is allowed to be marred by a blot on the record of the servant concerned, rules of natural justice must be complied with.” Executive Committee of Vaish Degree College, Shamli & Ors. v. Lakshmi Narain & Ors.[ (1976)2 SCC 58 ] [For short, “Vaish Degree College's case”] 62.
The law requires that, before the future of a servant is allowed to be marred by a blot on the record of the servant concerned, rules of natural justice must be complied with.” Executive Committee of Vaish Degree College, Shamli & Ors. v. Lakshmi Narain & Ors.[ (1976)2 SCC 58 ] [For short, “Vaish Degree College's case”] 62. The above decision was rendered by a Three Judge Bench of the Apex Court and it related to the case of a person, appointed on permanent basis, as a Principal of a private college, whose appointment was formerly approved by the Vice-Chancellor of the University concerned. He was later terminated from service, but without securing the prior approval of the Vice- Chancellor, as required in the provision contained in the University Act concerned. The employer was a private college, affiliated to the university concerned. The impugned dismissal was challenged by the employee concerned by filing a civil suit, which later led to civil appellate proceedings like First Appeal, Second Appeal and the matter ultimately reached the Apex Court. After surveying the previous case laws, as in Executive Committee of U P Warehousing Corporation v. C.K.Tyagi's case supra [ (1969) 2 SCC 838 ], Indian Airlines Corporation v. Sukhdeo Rai's case supra [ (1971) 2 SCC 192 ], Sirsi Municipality's case supra [ (1973) 1 SCC 409 ], the Apex Court, in the majority judgment held, in para 18 of Vaish Degree College's case supra [ (1976) 2 SCC 58 ], that a contract of personal service cannot ordinarily be specifically enforced by a civil court and a court normally would not give a declaration that the contract subsists and the employee, even after having been removed or dismissed from service, can be deemed to be in service, against the will and consent of the employer. But that, this rule of bar of specific performance of contract of personal service is however, subject to three well recognised exceptions — (i) where a government servant is sought to be removed from service in contravention of the provisions of Article 311 of the Constitution of India; (ii) where a workman is sought to be reinstated as per the Industrial Disputes Act; and (iii) where a statutory body acts in breach or violation of the mandatory provisions of the statute. 63.
63. The bar of specific performance of contract of personal service and the three exceptions thereto, as referred to in para 18 of Vaish Degree College's case supra [ (1976) 2 SCC 58 ], reads as follows : “18. On a consideration of the authorities mentioned above, it is, therefore, clear that a contract of personal service cannot ordinarily be specifically enforced and a court normally would not give a declaration that the contract subsists and the employee, even after having been removed from service can be deemed to be in service against the will and consent of the employer. This rule, however, is subject to three well recognised exceptions — (i) where a public servant is sought to be removed from service in contravention of the provisions of Article 311 of the Constitution of India; (ii) where a worker is sought to be reinstated on being dismissed under the Industrial Law; and (iii) where a statutory body acts in breach or violation of the mandatory provisions of the statute.” 64. The Apex Court held that, it has been well-settled, by the Constitution Bench in Sukhdev Singh & Ors. v. Bhagatram Sardar Singh Raghuvanshi & Anr., [ (1975) 1 SCC 421 (para 25 thereof page 435 of the SCC report)] that, a company incorporated under the Companies Act is not created by the Companies Act, but comes into existence in accordance with the provisions of the Act and it is not a statutory body because it is not created by the statute and it is a body created in accordance with the provisions of the statute concerned viz., Companies Act. On this basis, it was held by the Apex Court that Vaish Degree College, which is a private college, registered under the provisions of the Societies Registration Act, though affiliated to the University concerned, cannot be treated as a statutory body. Further, it was also found that concurring fact findings were made by all the courts below that the plaintiff therein (employee) had never executed an agreement with the Executive Committee of the college, in the form prescribed by the statutes framed under the University Act. 65.
Further, it was also found that concurring fact findings were made by all the courts below that the plaintiff therein (employee) had never executed an agreement with the Executive Committee of the college, in the form prescribed by the statutes framed under the University Act. 65. The dictum laid down by the Four Judge Bench of the Apex Court in P.R.Jodh's case supra [ (1965) 2 SCR 713 ] was distinguished and it was held that the provision of the university statute, relied on in Vaish Degree College's case supra [ (1976) 2 SCC 58 ], did not apply proprio vigore (see para 13 of Vaish Degree College's case supra). In para 19 of Vaish Degree College's case supra [ (1976) 2 SCC 58 ], the Apex Court held that, since the Executive Committee of the college in that case was not a statutory body, the said case would not fall within any of the three exceptions, stated in para 18 thereof, and that prima facie, the plaintiff was not entitled to any declaration or injunction. The Apex Court also recorded therein the contention that, in Sirsi Municipality's case supra[ (1973) 1 SCC 409 ], a fourth category, namely, an institution, which even though was a nonstatutory body, but was a local or public authority, was also conceived. Para 19 of Vaish Degree College's case supra [ (1976) 2 SCC 58 ], reads as follows : “19. In view of our finding that the Executive Committee of the college in the instant case was not a statutory body, the present case does not fall within any of the excepted categories mentioned above, and hence prima facie, the plaintiff/respondent is not entitled to any declaration or injunction. The learned Counsel for the respondent, however, placed great reliance on the decision of this Court in Sirsi Municipality case in order to contend that this decision had included within the fold of its exceptions a fourth category, namely, an institution which even though was a non-statutory body, but was a local or a public authority.
The learned Counsel for the respondent, however, placed great reliance on the decision of this Court in Sirsi Municipality case in order to contend that this decision had included within the fold of its exceptions a fourth category, namely, an institution which even though was a non-statutory body, but was a local or a public authority. Reliance was placed particularly on the following observations of Ray, J., as he then was, in that case: [SCC p. 413 : SCC(L&S) p. 210, paras 17, 18] “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. In the case of servant of the State or of local authorities or statutory bodies, courts have declared in appropriate cases the dismissal to be invalid if the dismissal is contrary to rules of natural justice or if the dismissal is in violation of the provisions of the statute.” 66. In para 20 of the majority judgment, it has been held that, assumed for argument sake, without deciding that Sirsi Municipality's case supra [ (1973) 1 SCC 409 ] has extended the scope of the exceptions, so that the appellant-Executive Committee of the college, though a non-statutory body, will still be bound by the statutory provisions of law. On this premise, the Apex Court considered the contention of the plaintiff-employee that there has been an infraction of a mandatory provision of the Act, which stipulated that the dismissal or removal from service of a teacher of a private college shall be reported to the Vice-Chancellor and that the impugned order shall not take effect until it has been approved by the Vice-Chancellor, etc., and that therefore, the impugned decision in that case was invalid. Thereafter, it has been observed in para 20 thereof, that the question still remains whether, even if there has been violation of the mandatory provisions of the statute, should the court, in exercise of its discretion, grant a declaration or an injunction to the plaintiff, in the peculiar facts and circumstances of the case. Ultimately, it was held that the discretion need not be exercised, to grant such a declaration or injunction sought for in that case, for the reasons stated in para 28 thereof, and accordingly, ordered that the plaintiff therein should be given damages of Rs.21,000/-.
Ultimately, it was held that the discretion need not be exercised, to grant such a declaration or injunction sought for in that case, for the reasons stated in para 28 thereof, and accordingly, ordered that the plaintiff therein should be given damages of Rs.21,000/-. So, it can be seen from a reading of the majority judgment of Vaish Degree College's case supra [ (1976) 2 SCC 58 ] that, though it was found that the Executive Committee of the private college in that case was not a statutory body and that the said case does not fall within the exceptional categories to the general bar. In para 20 thereof, it was held that, assuming for argument's sake, but not deciding that the decision in that case has extended the scope of the exceptions, still, it was held that the discretion to grant declaration or injunction should not be exercised, in the facts and circumstances of that case. 67. A concurring judgment was also rendered in Vaish Degree College's case supra [ (1976) 2 SCC 58 ] by Hon'ble Justice P.N.Bhagwati (as His Lordship then was), wherein the final conclusion, raised by the majority judgment, was concurred with and relief granted was confined to award of damages of Rs.21,000/- to the dismissed Principal of the private college. 68. Para 31 of the concurring judgment deals with the rationale for the bar, emanating from the Specific Relief Act, for enforcement of the specific performance of a contract of personal service. However, it was also categorically held therein that the said rationale, obviously, can have an application only where the contract of employment is a contract of personal service involving personal relations and it can have little relevance to conditions of employment in modern large scale industry and enterprise or statutory bodies or public authorities, where there is professional management of impersonal nature.
That, it is difficult to regard the contract of employment, in such cases, as a contract of personal service, save in exceptional cases and that there is no reason why specific performance should be refused in cases of this kind, where the contract of employment does not involve relationships of personal character and that these doctrines of contract of service, as personal, non-assignable, unenforceable and so on, grew up in an age when the contract of service was still frequently a “personal relation” between the owner of a small workshop or trade or business and his servant. That the modern conditions have now vastly changed and those old doctrines have to be adjusted and reformulated, in order to suit the needs of a changing society and that we cannot doggedly hold fast to these doctrines, which correspond to the social realities of an earlier generation, far removed from ours, etc. 69. Further, it was also held in the latter part of para 31 of the concurring judgment that, it is quite possible, within the limits of the doctrine, that a contract of personal service cannot be specifically enforced, to take the view that, in a case of employment under a statutory body or public authority, where there is ordinarily no element of personal relationship, the employee may refuse to accept the repudiation of the contract of employment by the statutory body or public authority and seek reinstatement, on the basis that the repudiation is ineffective and the contract is continuing, etc. It may be pertinent to refer to the abovesaid observations, in the latter part of para 31 of concurring judgment of Vaish Degree College's case supra [ (1976) 2 SCC 58 ], which reads as follows : “31......................... This rationale obviously can have application only where the contract of employment is a contract of personal service involving personal relations. It can have little relevance to conditions of employment in modern large-scale industry and enterprise or statutory bodies or public authorities where there is professional management of impersonal nature. It is difficult to regard the contract of employment in such cases as a contract of personal service save in exceptional cases. There is no reason why specific performance should be refused in cases of this kind where the contract of employment does not involve relationship of personal character.
It is difficult to regard the contract of employment in such cases as a contract of personal service save in exceptional cases. There is no reason why specific performance should be refused in cases of this kind where the contract of employment does not involve relationship of personal character. It must be noted that all these doctrines of contract of service as personal, non-assignable, unenforceable, and so on, grew up in an age when the contract of service was still frequently a “personal relation” between the owner of a small workshop or trade or business and his servant. The conditions have now vastly changed and these doctrines have to be adjusted and reformulated in order to suit needs of a changing society. We cannot doggedly hold fast to these doctrines which correspond to the social realities of an earlier generation far removed from ours. …............................................................................. It is, therefore, …........................ quite possible, within the limits of the doctrine that a contract of personal service cannot be specifically enforced, to take the view that in case of employment under a statutory body or public authority where there is ordinarily no element of personal relationship, the employee may refuse to accept the repudiation of the contract of employment by the statutory body or public authority and seek reinstatement on the basis that the repudiation is ineffective and the contract is continuing.” 70. Para 32 of the majority judgment of Vaish Degree College's case supra [ (1976) 2 SCC 58 ] deals with the cases where the relationship between the employer and employee is governed by statute or subordinate legislation and where the termination may, in a given situation, be null and void, etc. It was held therein that the doctrine, that a contract of personal service cannot be specifically enforced, would not stand in the way of the employee, because the termination being null and void, in such a case, there being no repudiation at all in the eye of law, there would be no question of enforcing specific performance of the contract of employment and what the employee would be claiming, in such a case, is not enforcement of a contract of personal service but declaration of statutory invalidity of an act done by the employer. 71.
71. In para 33 of the concurring judgment, two questions have been considered, first, as to what is the 'statutory body' contemplated, which is conceived in the exception and second, as to whether the three exceptions, mentioned supra, intended to be exhaustive? It was held that, obviously, a body or authority created by a statute, would be a statutory body, but even a body or authority, which is created under a statute, as for example, the State Road Transport Corporation, which is created by the State under the Road Transport Corporations Act, 1950, would also be a statutory body and that what other kinds of statutory bodies would be included is a matter not free from difficulty. Further that, the three exceptions, mentioned supra in the case laws, are not intended to be and cannot be exhaustive and the categories of exceptions to the general rule should not be closed, because any attempt at rigid and exhaustive formulation of legal rules and any attempt to put the law in a straitjacket formula, is bound to stifle the growth of law and seriously cripple its capacity to adapt itself to the changing needs of society. Further, it has also been observed, in the latter part of para 33 thereof, that it is not necessary to decide whether Vaish Degree College is or is not a statutory body or a public authority, etc. 72. After considering the impact of the section in the University Act concerned, which mandated prior approval of the Vice-Chancellor for the dismissal of the teacher, it has been held, in para 34 of the concurring judgment of Vaish Degree College's case supra [ (1976) 2 SCC 58 ], that the language of that section is absolute and peremptory and leaves no doubt as to its meaning and that it provides that the termination of service of a teacher, by the management, shall not take effect, that is, it shall be ineffective and inoperative, unless the Vice-Chancellor, on being informed, has approved of the termination of service and that, when this section of the University Act, which is a law made by the Legislature, has enacted that the termination of service shall be ineffective or, in other words, it shall have no validity or force, unless it has been approved by the Vice-Chancellor, it is difficult to see how it can be regarded as effectively terminating the service. 73.
73. Further, it has also been held in para 34 that the above said provision of the University Act would operate, irrespective as to whether the management is or is not a statutory body and such a consideration as to whether the college management is or is not a statutory body, is entirely irrelevant to the applicability of the said section of the University Act. That, when the section says that the termination of service shall not have any effect, the Court must refuse to recognise the termination as valid and effective, and when the Court does so, it merely enforces the law and there is no question of transgressing the principle that a contract of personal service cannot be enforced and hence, it was held that there can be no doubt that the termination of service of the 1st respondent therein by the appellant-college, was ineffective and void and it did not operate to put an end to the employment, etc. 74. However, in para 35 of the concurring judgment, it was held that the discretion to grant a declaration or injunction, as sought for in the said suit, need not be granted, taking into consideration the facts and circumstances of that case and has concurred with the ultimate conclusion of the majority judgment that the relief of declaration or injunction need not be granted but that, damages of Rs.21,000/- need alone be granted. It was held that, ordinarily, an employee, whose termination of service is found to be null and void or ineffective, by reason of a statutory provision and that would include subordinate legislation, which has the force of law, should be awarded a declaration that he continues in service, etc. In para 35 of the concurring judgment, it was held that His Lordship agrees with the view of the majority Judges that, having regard to the peculiar facts and circumstances of this case, it is not a fit and proper case, where the relief of declaration and injunction should be granted and that instead, he could be awarded Rs.21,000/-, as a fair and just compensation. Sukhdev Singh & Ors. v. Bhagatram Sardar Singh Raghuvanshi & Anr. [ (1975) 1 SCC 421 ] ( “Sukhdev Singh's case” for short) 75. The decision in Sukhdev Singh's case supra has been rendered by a Constitution Bench of 5 Judges of the Apex Court.
Sukhdev Singh & Ors. v. Bhagatram Sardar Singh Raghuvanshi & Anr. [ (1975) 1 SCC 421 ] ( “Sukhdev Singh's case” for short) 75. The decision in Sukhdev Singh's case supra has been rendered by a Constitution Bench of 5 Judges of the Apex Court. One of the main issues considered therein was as to whether the contravention of statutory regulation, framed under the enactments constituting the public sector corporations concerned therein, like Oil & Natural Gas Commission Act, Life Insurance Corporation Act, Industrial Finance Corporation Act, in effecting termination of service of employees would have the effect of rendering it statutorily invalid, etc., and also as to whether those Corporations could be considered as "other authority", so as to fulfill the definition of "State", as per Article 12 of the Constitution of India. It has been held, in para 17 of the majority judgment of Sukhdev Singh's case supra, that the subordinate legislation has, if validly made, the full force and effect of a statute. That is so whether or not the statute, under which it is made, provides expressly that it is to have effect as if enacted therein. If an instrument, made in the exercise of delegated powers, directs or forbids the doing of a particular thing, the result of a breach thereof is, in the absence of a provision to the contrary, the same as if the command or prohibition had been contained in the enabling statute (parent act) itself. Similarly, if such an instrument authorizes or requires the doing of any act, the principles to be applied in determining whether a person injured by the act has any right of action, in respect of the injury, are not different from those applicable whether the injury results from an act done under the direct authority of an enactment. 76. Further, it has been held in para 33 thereof that Corporations, like the Oil & Natural Gas Corporation, the Life Insurance Corporation and the Industrial Finance Corporation, are all required, by the enactments concerned, to frame regulations inter alia for the purpose of the duties and conduct and conditions of service of officers and other employees. These regulations impose obligation on those statutory authorities, who cannot deviate from the conditions of service. Any deviation will be enforced by a legal sanction of declaration by courts to invalidate actions in violation of the rules and regulations.
These regulations impose obligation on those statutory authorities, who cannot deviate from the conditions of service. Any deviation will be enforced by a legal sanction of declaration by courts to invalidate actions in violation of the rules and regulations. That the existence of rules and regulations under the statute is to ensure regular conduct with a distinctive attitude to that conduct as a standard. In that regard, very crucially, it has been further held in para 33 thereof that the statutory regulations, in the cases under consideration, give the employees a statutory status and impose restriction on the employer and the employee with no option to vary the conditions. That, an ordinary individual, in the case of a master and servant contractual relationship, enforces breach of contractual terms, and the remedy in such a contractual relationship of master and servant is damages because personal service is not capable of enforcement. In cases of statutory bodies, there is no personal element whatsoever because of the impersonal character of statutory bodies. Further, that failure to observe such requirements is enforced by courts by declaring dismissal in violation of rules and regulations to be void, and that Courts have repeatedly held that whenever a person's right is affected by decision taken under statutory powers, the Court would presume the existence of a duty to observe the rules of natural justice and compliance with rules and regulations imposed by the statute. (See pages 438 & 439 of SCC Report) 77. So also, it has been categorically held in para 23 thereof, that the noticeable feature in such cases is that those employer bodies have no free hand in framing the conditions and terms of service of their employees and these bodies are bound to apply the terms and conditions as laid down in the regulations, and the statutory bodies are not free to make such terms as they think fit and proper. The regulations prescribe the terms of appointment, conditions of service and procedure for dismissing employees. Very crucially, it has been held therein that these regulations in the statutes are described as “status fetters on the freedom of contract”. (See page 434 of SCC Report) 78.
The regulations prescribe the terms of appointment, conditions of service and procedure for dismissing employees. Very crucially, it has been held therein that these regulations in the statutes are described as “status fetters on the freedom of contract”. (See page 434 of SCC Report) 78. It will be pertinent to refer to the relevant portions of paras 23 & 33 of Sukhdev Singh's case supra [ (1975) 1 SCC 421 ], which read as follows: "23.The noticeable feature is that these statutory bodies have no free hand in framing the conditions and terms of service of their employees. These statutory bodies are bound to apply the terms and conditions as laid down in the regulations. The statutory bodies are not free to make such terms as they think fit and proper. Regulations prescribe the terms of appointment, conditions of service and procedure for dismissing employees. These regulations in the statutes are described as “status fetters on freedom of contract” (emphasis supplied)..................... xxxx xxxx xxxx xxxx 33.There is no substantial difference between a rule and a regulation inasmuch as both are subordinate legislation under powers conferred by the statute. A regulation framed under a statute applies uniform treatment to every one or to all members of some group or class. The Oil and Natural Gas Commission, the Life Insurance Corporation and Industrial Finance Corporation are all required by the statute to frame regulations inter alia for the purpose of the duties and conduct and conditions of service of officers and other employees. These regulations impose obligation on the statutory authorities. The statutory authorities cannot deviate from the conditions of service. Any deviation will be enforced by legal sanction of declaration by courts to invalidate actions in violation of rules and regulations. The existence of rules and regulations under statute is to ensure regular conduct with a distinctive attitude to that conduct as a standard. The statutory regulations in the cases under consideration give the employees a statutory status and impose restriction on the employer and the employee with no option to vary the conditions. An ordinary individual in a case of master and servant contractual relationship enforces breach of contractual terms. The remedy in such contractual relationship of master and servant is damages because personal service is not capable of enforcement. In cases of statutory bodies, there is no personal element whatsoever because of the impersonal character of statutory bodies.
An ordinary individual in a case of master and servant contractual relationship enforces breach of contractual terms. The remedy in such contractual relationship of master and servant is damages because personal service is not capable of enforcement. In cases of statutory bodies, there is no personal element whatsoever because of the impersonal character of statutory bodies. In the case of statutory bodies it has been said that the element of public employment or service and the support of statute require observance of rules and regulations. Failure to observe requirements by statutory bodies is enforced by courts by declaring dismissal in violation of rules and regulations to be void. This Court has repeatedly observed that whenever a man's rights are affected by decision taken under statutory powers, the Court would presume the existence of a duty to observe the rules of natural justice and compliance with rules and regulations imposed by statute. " 79. So also, it has been held in para 67 thereof, that the rules and regulations framed by the Oil and Natural Gas Corporation, Life Insurance Corporation and the Industrial Finance Corporation have the force of law. The employees of these statutory bodies have a statutory status and they are entitled to declaration of being in employment when their dismissal or removal is in contravention of statutory provisions. It has also been held that, going by various tests, those Corporations considered in those cases would also satisfy the definition of “other authorities” within the meaning of "State" as per Article 12 of the Constitution of India. 80. The Hon'ble Mr.Justice K.K.Mathew, has rendered a concurring judgment in Sukhdev Singh's case supra [ (1975) 1 SCC 421 ]. In that regard, it will be pertinent to refer to para 117 of the concurring judgment, wherein the concept of contract of personal employment and that it is incompatible with the modern days of large, impersonal, corporate employees have been stated. It was held therein that modern conditions have now vastly changed and it is difficult to regard the contract of employment with large scale industries and government enterprises, conducted by bodies, which are created under special statutes, as mere contract of personal service.
It was held therein that modern conditions have now vastly changed and it is difficult to regard the contract of employment with large scale industries and government enterprises, conducted by bodies, which are created under special statutes, as mere contract of personal service. Where large number of people are unemployed and it is extremely difficult to find employment, an employee, who is discharged from service, might have to remain without means of subsistence for a considerably long time and damages in the shape of wages for a certain period may not be an adequate compensation to the employee for non-employment. In other words, damages would be a poor substitute for reinstatement. It will be pertinent to refer to para 117 of Sukhdev Singh's case supra, which reads as follows : (See pages 459 & 460 of SCC Report) "117.The original concept of employment was that of master and servant. It was therefore held that a court will not specifically enforce a contract of employment. The law has adhered to the age-old rule that an employer may dismiss the employee at will. Certainly, an employee can never expect to be completely free to do what he likes to do. He must face the prospect of discharge for failing or refusing to do his work in accordance with his employers directions. Such control by the employer over the employee is fundamental to the employment relationship. But there are innumerable facets of the employee's life that have little or no relevance to the employment relationship and over which the employer should not be allowed to exercise control. It is no doubt difficult to draw a line between reasonable demands of an employer and those which are unreasonable as having no relation to the employment itself. The rule that an employer can arbitrarily discharge an employee with or without regard to the actuating motive is a rule settled beyond doubt. But the rule became settled at a time when the words “master” and “servant” were taken more literally than they are now and when, as in early Roman law, the rights of the servant, like the rights of any other member of the household, were not his own, but those of his pater familias. The overtones of this ancient doctrine are discernible in the judicial opinion which rationalised the employer's absolute right to discharge the employee.
The overtones of this ancient doctrine are discernible in the judicial opinion which rationalised the employer's absolute right to discharge the employee. Such a philosophy of the employer's dominion over his employee may have been in tune with the rustic simplicity of bygone days. But that philosophy is incompatible with these days of large, impersonal, corporate employers. The conditions have now vastly changed and it is difficult to regard the contract of employment with large scale industries and government enterprises conducted by bodies which are created under special statutes as mere contract of personal service. Where large number of people are unemployed and it is extremely difficult to find employment, an employee who is discharged from service might have to remain without means of subsistence for a considerably long time and damages in the shape of wages for a certain period may not be an adequate compensation to the employee for non-employment. In other words, damages would be a poor substitute for reinstatement. The traditional rule has survived because of the sustenance it received from the law of contracts. From the contractual principle of mutuality of obligation, it was reasoned that if the employee can quit his job at will, then so too must the employer have the right to terminate the relationship for any or no reason. And there are a number of cases in which even contracts for permanent employment i.e. for indefinite terms, have been held unenforceable on the ground that they lack mutuality of obligation. But these cases demonstrate that mutuality is a high-sounding phrase of little use as an analytical tool and it would seem clear that mutuality of obligation is not an inexorable requirement and that lack of mutuality is simply, as many courts have come to recognize, an imperfect way of referring to the real obstacle to enforcing any kind of contractual limitation on the employer's right of discharge i.e. lack of consideration. If there is anything in contract law which seems likely to advance the present inquiry, it is the growing tendency to protect individuals from contracts of adhesion, from overreaching terms often found in standard forms of contract used by large commercial establishments. Judicial disfavour of contracts of adhesion has been said to reflect the assumed need to protect the weaker contracting party against the harshness of the common law and the abuses of freedom of contract.
Judicial disfavour of contracts of adhesion has been said to reflect the assumed need to protect the weaker contracting party against the harshness of the common law and the abuses of freedom of contract. The same philosophy seems to provide an appropriate answer to the argument, which still seems to have some vitality, that “the servant cannot complain, as he takes the employment on the terms which are offered to him”." 81. Further, very crucially, it has been held in para 31 of Sukhdev Singh's case supra, that the earlier decisions of the Apex Court in U. P. Warehousing Corporation Ltd. v. C. K. Tyagi [ (1969) 2 SCC 838 ] and Indian Airlines Corporation v. Sukhdeo Rai [ (1971) 2 SCC 192 ], are in direct conflict with the decision of the Constitution Bench of 5 Judges', in Mafatlal Narandas Barot's case [ AIR 1966 SC 1364 ]. In other words, the earlier dicta laid down in decisions as in C. K. Tyagi's case supra and Indian Airlines Corporation's case supra, that mere violation of statutes, framed by the employer Corporation under the relevant enactments, may not be sufficient to hold that dismissal or termination of service in breach thereof would make such orders statutorily invalid and ultra vires, in the absence of any specific prescriptions in the parent enactments, etc., have thus been overruled by the Constitution Bench of the Apex Court in Sukhdev Singh’s case supra [ (1975) 1 SCC 421 ]. (See para 31 on page 438 of the SCC Report of Sukhdev Singh’s case) 82. Further, in para 32 of Sukhdev Singh’s case supra, the Constitution Bench has relied on the earlier dictum laid down by the Constitution Bench in Sirsi Municipality's case supra [ (1973) 1 SCC 409 ], and has held that, where a State or public authority dismisses an employee in violation of the mandatory procedural requirements, on grounds which are not sanctioned or supported by statutes, the Courts may exercise its jurisdiction to declare the act of dismissal to be a nullity, and the ratio is that rules and regulations are binding on the authority. Managing Director, U. P. Warehousing Corporation & Anr. v. Vijay Narayan Vajpayee [ (1980) 3 SCC 459 ] ( “The second U. P. Warehousing Corporation's case” for short ) 83.
Managing Director, U. P. Warehousing Corporation & Anr. v. Vijay Narayan Vajpayee [ (1980) 3 SCC 459 ] ( “The second U. P. Warehousing Corporation's case” for short ) 83. This was a case involving an employee of the Uttar Pradesh State Warehousing Corporation, which was the subject matter of consideration in C. K. Tyagi's case supra [ (1969) 2 SCC 838 ]. In para 9 thereof, the Apex Court has dealt with the bar of specific performance of contract of personal service, and the 3 well known exceptions thereto, involving: Dismissal of government servants in contravention of Article 311 of the Constitution of India. Dismissal of the workmen in contravention of the provisions contained in the Industrial Disputes Act. Dismissal of employees from statutory bodies in breach of a mandatory obligation, imposed by the statutory rules/regulations etc. 84. In para 10 thereof, their Lordships of the Apex Court have categorically held that the authority of the dictum laid down earlier, in the case of the very same employer corporation (U. P. Warehousing Corporation) in C. K. Tyagi's case supra, has been eroded by the later decisions, pronounced by the Constitution Bench more particularly, in the celebrated Sukhdev Singh’s case supra. Further, it has also been reiterated in para 11 thereof, that the decisions in C. K. Tyagi's case supra and Indian Airlines Corporation's case supra are in direct conflict with the earlier decision of the Constitution Bench in Mafatlal Narandas Barot's case supra, and that they were wrongly decided. It was reiterated therein that these statutory bodies have no free hand. 85. It was reiterated, in para 10 of the second U. P. Warehousing Corporation's case supra [ (1980) 3 SCC 459 ] that, in view of the regulations governing the field, the form and content of contract with a particular employee is prescriptive and statutory, and that these bodies have no free hand in framing the conditions and terms of services of their employees, and that they are bound to apply the terms and conditions as laid down in the regulations, and these regulations give the employees a statutory status, and impose obligations on the statutory authorities, who cannot deviate from the conditions of service, etc. Then, ultimately, the Apex Court upheld the direction for reinstatement, but interfered with the consequential relief for grant of full backwages.
Then, ultimately, the Apex Court upheld the direction for reinstatement, but interfered with the consequential relief for grant of full backwages. Indrapal Gupta v Managing Committe, Model Inter College, Thora [ (1984) 3 SCC 384 = AIR 1984 SC 1110 ] ( "Indrapal Gupta's case" for short ) 86. The Indrapal Gupta's case supra was rendered by 3 Judges' Bench of the Apex Court, and it was concerned with a case of termination from service of a probationary appointee Headmaster of a private intermediate college. The college was regulated in accordance with the procedure contained in the U. P. Intermediate Education Act, 1921, whereby Sec. 16-G provided that every person, employed in a recognised institution, shall be governed by such conditions of service as may be prescribed by Regulations, and that the Regulations may be made in respect of the period of probation, the conditions of confirmation and the procedure for the imposition of punishment. The Board of High School and Intermediate Education was authorized to make Regulations in respect of all matters, which, by the Act, are to be provided for by the Regulations, with the previous sanction of the State Government. Regulations 35 to 38 of the Act provided for the procedure for termination of the services of an employee by way of punishment, in the matter of prescribed requirement of framing of articles of charge, communications thereof, written statement of defense, hearing in person, oral enquiry etc. In that case, a probationary appointee in the post of Headmaster was discharged from service. The Apex Court held that the factual materials indicated that the termination of service was not merely a discharge in respect of a probationer, but was on the ground of alleged misconduct, and the discharge order was a mere camouflage, for an order imposing penalty of termination of service on the ground of misconduct. Further, the Apex Court has categorically held, in para 6 of Indrapal Gupta's case supra, that the above said provisions in the Regulations, relating to the procedure to be followed by the College, for imposing the punishment of dismissal or removal from service, are virtually the same as provided by Article 311(2) of the Constitution of India, and the principles, which should govern this case should, therefore, be the same as those underlying Article 311(2).
Therefore, the principles which govern this field should be the same as those underlying Article 311 (2). The relevant portion of para 6 thereof, reads as follows: “6. It is seen from the foregoing that the above provisions relating to the procedure to be followed before imposing the punishment of dismissal or removal from service are virtually the same as provided by Article 311(2) of the Constitution and the principles which should govern this case should, therefore, be the same as those underlying Article 311(2).” 87. In that view of the matter, the Apex Court has declared that the termination from service of the probationary appointee was ultra vires, and held that he continues to be in service of the college and that he is entitled to all benefits flowing from the said declaration, including salary and allowances, as there was no break in service. Manmohan Singh Jaitla v. Commissioner, Union Territory of Chandigarh & Ors. [1984 Supp SCC 540] (“ Manmohan Singh Jaitla's case” for short) 88. The case concerned the termination from service of a Headmaster and teacher of an aided private high school governed by the Punjab Aided Schools (Security of Service) Act, 1969. It was found that the school was receiving 95% of its expenses as a grant from the government. A reading of para 4 of Manmohan Singh Jaitla's case supra would indicate that, Sec. 3 of the said 1969 Act provided that no employee shall be dismissed or removed or reduced in rank, except after an inquiry to be held in the manner prescribed therein. Sub-section (2) provides that no order of dismissal or removal or reduction in the rank of an employee shall take effect, unless it has been confirmed by the Deputy Commissioner, who may refuse to do so, if, in his opinion, the provisions of sub-section (1) have not been complied with. Sub-section (5) permits an aggrieved person to prefer an appeal against any decision or order of the Deputy Commissioner, under the section, within a period of thirty days, to the Commissioner, etc. 89. The Apex Court found that, earlier a disciplinary enquiry was initiated against the Headmaster concerned and the same was dropped and later, he was given notice that his services were no longer required from the date of issuance of the impugned notice therein.
89. The Apex Court found that, earlier a disciplinary enquiry was initiated against the Headmaster concerned and the same was dropped and later, he was given notice that his services were no longer required from the date of issuance of the impugned notice therein. The Apex court held, in para 6 thereof, that Sec. 3 of the above Act makes it mandatory and obligatory to hold a disciplinary enquiry, before an employee of an aided school can be either dismissed or removed or reduced in rank, and that, in order to circumvent this mandatory provision, a resort to the provisions of the agreement, in the context of the fact that an enquiry was commenced and given up, clearly indicates the true nature of the order as well as the colourable exercise of power. Accordingly, the Apex Court ordered, in paras 10 & 11 thereof, that the impugned termination of service of the Headmaster concerned and the teacher concerned, being in contravention of the statute, would be liable for interdiction and ordered that the said 2 dismissed employees shall be reinstated in service, with continuity of service and with full backwages. Vidya Dhar Pande v. Vidyut Grih Siksha Samiti & Ors. [ (1988) 4 SCC 734 ] (“ Vidya Dhar Pande's case” for short) 90. The case concerned the dismissal of the Headmaster of a private school, registered under the provisions of the Madhya Pradesh Non-trading Corporation Act, 1962, and the school was receiving a 100% grant from the Government. It was found that the dismissal was in violation of Regulations 71 & 79 of the Regulations framed by the Board of Secondary Education under Section 28(2)(d) of the Madhya Pradesh Madhyamik Shiksha Adhiniyam, 1965. In writ proceedings, the Madhya Pradesh High Court held that the Regulations framed by the Board of Secondary Education under the said Act, does not have any statutory force, and so the termination of service, in violation of Regulations 71 & 79, does not entitle the aggrieved employee to get a declaration that the termination was invalid and illegal, and for direction for reinstatement in service with 50% of backwages, etc. The Apex Court referred to Regulation 61 thereof, which stipulated that no educational institution shall be recognised, or continued to be recognised unless it complies with the requirements therein.
The Apex Court referred to Regulation 61 thereof, which stipulated that no educational institution shall be recognised, or continued to be recognised unless it complies with the requirements therein. Further, that Regulation 71 prescribed the probation of Principals, Headmasters, Lecturers, and Teachers, except those appointed temporarily for a period of less than one year, and also provisions relating to declaration of probation and deemed confirmation. Regulation 79(1) stipulated that the Managing Committee shall not terminate the services and reduce the pay of Principal or Head Master, appointed on written contract, without first obtaining the Director's sanction for holding a full enquiry into the charges against him, and the incumbent shall be given in writing a statement of the charges against him, and also be afforded an opportunity of defending himself. Regulation 79(2) stipulated that no decision, as to termination of service or reduction of a Principal or a Headmaster, shall be valid, unless passed at a Special Meeting by a majority of two-thirds of members of the Managing Committee. These aspects are borne out from a reading of para 3 of Vidya Dhar Pande's case supra. Para 4 thereof, referred to Sec.28(2)(d) of the Act, which authorized framing of Regulations to regulate the conditions of recognition of institutions for the purposes of admission to the privileges of the Board and framing of a School Code to ensure a minimum standard of efficient and uniform management of such schools. In para 5, the Apex Court held that Section 28(2)(d) confers power on the Board to make Regulations regarding the conditions of the institutions as well as for framing of a “School Code” to ensure a minimum standard of efficient and uniform management of such schools. Regulation 71 prescribed the probation of the appointees mentioned therein and about confirmation and deemed confirmation. 91. In para 9 thereof, the Apex Court referred to the dictum laid down by the Constitution Bench in Sukhdev Singh's case supra, and in para 11 thereof, it has been held that the earlier dictum, laid down in C. K. Tyagi's case supra and Indian Airlines Corporation's case supra, stand overruled by the Constitution Bench decision in Sukhdev Singh's case supra, and that they are in conflict with the Constitution Bench decision in Mafatlal Narandas Barot's case supra.
In paras 13 to 15, their Lordships have relied on the dictum in P. R. Jodh's case supra [ (1965) 2 SCR 713 ], Manmohan Singh Jaitla's case supra [1984 Supp SCC 540] and Indrapal Gupta's case supra [ (1984) 3 SCC 384 ]. 92. In para 16 of Vidya Dhar Pande's case supra, the Apex Court has held that the irresistible conclusion to be drawn from the above said case laws is that the impugned order of termination of the appellant therein, from the post of Headmaster of the Higher Secondary School, is in breach of Regulation 79, framed under the said Act, and therefore the same is illegal and liable to be quashed, as the said Regulation has the statutory force, and that the appellant is to be reinstated in service as Headmaster with 50% of backwages. It was also inter alia held, that the said private school therein, run by a trust, receiving 100% grant from the Government, is amenable to writ jurisdiction for violation of the provisions of the above said Regulations, in passing the order of termination from service. State Bank of India & Ors. v. S. N. Goyal [ (2008) 8 SCC 92 ] (“ S. N. Goyal's case” for short) 93. In this case, the Apex Court has laid down the legal principles and the scenarios in which the exceptions to the bar of specific performance of contractual personal service would arise. This is the landmark case, where the Apex Court has accepted the exceptions in the case of a non statutory body, as envisaged in the concurring judgment in Vaish Degree College's case supra [ (1976) 2 SCC 58 ]. In para 17 of S. N. Goyal's case supra, the Apex Court has referred to the general principle that, where the relationship of master and servant is purely contractual, it is well settled that a contract of personal service is not specifically enforceable, having regard to the bar contained in Section 14 of the Specific Relief Act, 1963 (“S. R. Act” for short). Even if the termination of the contract of employment (by dismissal or otherwise) is found to be illegal or in breach, the remedy of the employee is only to seek damages and not specific performance.
Even if the termination of the contract of employment (by dismissal or otherwise) is found to be illegal or in breach, the remedy of the employee is only to seek damages and not specific performance. Courts will neither declare such termination to be a nullity nor declare that the contract of employment subsists nor grant the consequential relief of reinstatement. However, it was laid down therein, that the three well-recognised exceptions to this rule are: where a civil servant is removed from service in contravention of the provisions of Article 311 of the Constitution of India (or any law made under Article 309); where a workman having the protection of the Industrial Disputes Act, 1947 is wrongly terminated from service; and where an employee of a statutory body is terminated from service in breach or violation of any mandatory provision of a statute or statutory rules. 94. Further, the Apex Court expatiated by holding thereunder that there is a clear distinction between public employment, governed by statutory rules and private employment, governed purely by contract. The test for deciding the nature of relief—damages or reinstatement with consequential reliefs—is whether the employment is governed purely by contract or by a statute or statutory rules. Even where the employer is a statutory body, where the relationship is purely governed by contract with no element of statutory governance, the contract of personal service will not be specifically enforceable. Conversely, where the employer is a non-statutory body, but the employment is governed by a statute or statutory rules, a declaration that the termination is null and void and that the employee should be reinstated can be granted by courts, where there is contravention of statutory rules. It may be pertinent to refer to the contents of para 17 of S. N. Goyal's case supra, which reads as follows: "17.Where the relationship of master and servant is purely contractual, it is well settled that a contract of personal service is not specifically enforceable, having regard to the bar contained in Section 14 of the Specific Relief Act, 1963. Even if the termination of the contract of employment (by dismissal or otherwise) is found to be illegal or in breach, the remedy of the employee is only to seek damages and not specific performance.
Even if the termination of the contract of employment (by dismissal or otherwise) is found to be illegal or in breach, the remedy of the employee is only to seek damages and not specific performance. Courts will neither declare such termination to be a nullity nor declare that the contract of employment subsists nor grant the consequential relief of reinstatement. The three well-recognised exceptions to this rule are: (i) where a civil servant is removed from service in contravention of the provisions of Article 311 of the Constitution of India (or any law made under Article 309); (ii) where a workman having the protection of the Industrial Disputes Act, 1947 is wrongly terminated from service; and (iii) where an employee of a statutory body is terminated from service in breach or violation of any mandatory provision of a statute or statutory rules. There is thus a clear distinction between public employment governed by statutory rules and private employment governed purely by contract. The test for deciding the nature of relief—damages or reinstatement with consequential reliefs—is whether the employment is governed purely by contract or by a statute or statutory rules. Even where the employer is a statutory body, where the relationship is purely governed by contract with no element of statutory governance, the contract of personal service will not be specifically enforceable. Conversely, where the employer is a non-statutory body, but the employment is governed by a statute or statutory rules, a declaration that the termination is null and void and that the employee should be reinstated can be granted by courts. (Vide S.B. Dutt (Dr.) v. University of Delhi [ AIR 1958 SC 1050 ], U.P. Warehousing Corpn. v. Chandra Kiran Tyagi [ (1969) 2 SCC 838 : (1970) 2 SCR 250 ], Sirsi Municipality v. Cecelia Kom Francis Tellis [ (1973) 1 SCC 409 : 1973 SCC (L&S) 207 : (1973) 3 SCR 348 ], Vaish Degree College v. Lakshmi Narain [ (1976) 2 SCC 58 : 1976 SCC (L&S) 176 : (1976) 2 SCR 1006 ], J. Tiwari v. Jwala Devi Vidya Mandir [ (1979) 4 SCC 160 : 1979 SCC (L&S) 356 : AIR 1981 SC 122 ] and Dipak Kumar Biswas v. Director of Public Instruction [ (1987) 2 SCC 252 : (1987) 3 ATC 505 : AIR 1987 SC 1422 ] .)” 95.
So, it can be seen that the Apex Court has categorically declared the law, that where an employee of a statutory body is terminated from service, in breach of the mandate of statute or statutory rules, then it would form a well recognized exception to the general bar emanating from Sec.14(c) read with Sec.41(e) of the S. R. Act. So also, it has been held therein that, even if the employer is a statutory body, but where the relationship of employer-employee is purely governed by contract, with no element of statutory governance, then the contract of personal service may not be specifically enforceable. Further, conversely, it has been held that, where the employer is a non-statutory body, but the employment is governed by a statute or statutory rules, then declaration that the termination is null and void and that the employee should be reinstated in service could be granted by the Courts, where the termination from service is rendered in violation of the statutory mandate. 96. As mentioned above, this is the landmark case where the Apex Court has expanded the exceptions to the general bar of specific performance of contract of personal service, as envisaged in the concurring judgment of the Apex Court in Vaish Degree College's case supra. Rajasthan State Road Transport Corporation & Anr. v. Bal Mukund Bairwa (2) [ (2009) 4 SCC 299 ] (“Bal Mukund Bairwa’s case ” for short) 97. The Three Judges' Bench of the Apex Court in the afore Bal Mukund Bairwa’s case supra has laid down the legal principles on two aspects. One, regarding the respective jurisdictions of the civil court and the labour court, and secondly, on the issue of bar in Sec. 14 of the S. R. Act against the specific performance of a contract of personal service. Paras 38 & 39 thereof are relevant for our present purposes, inasmuch as they deal with the issues regarding the bar as per Sec. 14 of the S. R. Act against the specific performance of a contract of personal service. Paras 38 & 39 of Bal Mukund Bairwa’s case supra, read as follows: “38.Where the relationship between the parties as employer and employee is contractual, the right to enforce the contract of service depending on personal volition of an employer is prohibited in terms of Section 14(1)(b) of the Specific Relief Act, 1963.
Paras 38 & 39 of Bal Mukund Bairwa’s case supra, read as follows: “38.Where the relationship between the parties as employer and employee is contractual, the right to enforce the contract of service depending on personal volition of an employer is prohibited in terms of Section 14(1)(b) of the Specific Relief Act, 1963. It has, however, four exceptions, namely, (1) when an employee enjoys a status i.e. his conditions of service are governed by the rules framed under the proviso appended to Article 309 of the Constitution of India or a statute and would otherwise be governed by Article 311(2) of the Constitution of India; (2) where the conditions of service are governed by statute or statutory regulation and in the event mandatory provisions thereof have been breached; (3) when the service of the employee is otherwise protected by a statute; and (4) where a right is claimed under the Industrial Disputes Act or sister laws, termination of service having been effected in breach of the provisions thereof. 39.The appellant Corporation is bound to comply with the mandatory provisions of the statute or the regulations framed under it. A subordinate legislation when validly framed becomes a part of the Act. It is also bound to follow the principles of natural justice. In the event it is found that the action on the part of the State is violative of the constitutional provisions or the mandatory requirements of a statute or statutory rules, the civil court would have the jurisdiction to direct reinstatement with full back wages. ” 98. The legal position adumbrated by the Apex Court in para 38 of Bal Mukund Bairwa’s case supra is, that where the relationship between the parties as employer and employee is contractual, the right to enforce the contract of service, depending on personal volition of an employer, is prohibited in terms of Section 14 of the S. R. Act.
” 98. The legal position adumbrated by the Apex Court in para 38 of Bal Mukund Bairwa’s case supra is, that where the relationship between the parties as employer and employee is contractual, the right to enforce the contract of service, depending on personal volition of an employer, is prohibited in terms of Section 14 of the S. R. Act. But that, it has 4 exceptions, namely, (1) when an employee enjoys a status i.e., his conditions of service are governed by the rules framed under the proviso appended to Article 309 of the Constitution of India or a statute and would otherwise be governed by Article 311(2) of the Constitution of India; (2) where the conditions of service are governed by statute or statutory regulation and in the event mandatory provisions thereof have been breached; (3) when the service of the employee is otherwise protected by a statute; and (4) where a right is claimed under the Industrial Disputes Act or sister laws, termination of service having been effected in breach of the provisions thereof. Further, it has been inter alia stated in para 39 thereof that, the Corporation is bound to comply with the mandatory provisions of the statute or the regulations framed under it and that, a subordinate legislation, when validly framed, becomes a part of the Act, etc. Scenarios (2) & (3) mentioned in para 38 of Bal Mukund Bairwa’s case supra, does not make any distinction as to whether the employer is a statutory body or a non statutory body, and this appears to be in consonance with the views in paras 33 & 34 of the concurring judgment of the Apex Court in Vaish Degree College's case supra [ (1976) 2 SCC 58 ], wherein it was held that, it may make no difference as to whether the employer is a statutory body or a non statutory body, but the crucial aspect is that the employer should have terminated the service of the employee concerned, in breach of the statutory provisions, and the consideration as to whether the employer is a statutory body or a non statutory body is entirely irrelevant to the applicability of the statutory provision in question. 99. So also, scenario (3), covered by para 38 of Bal Mukund Bairwa’s case supra, conceives of a case where the service of an employee is otherwise protected by a statute.
99. So also, scenario (3), covered by para 38 of Bal Mukund Bairwa’s case supra, conceives of a case where the service of an employee is otherwise protected by a statute. Here also, no distinction has been laid down by the Apex Court, as to whether the employer is a statutory body or a non statutory body, but the heart of the matter is that, the service conditions of an employee should be protected by a statute, and the impugned termination from service is in breach of such statutory provisions. Further, it has also been held, in para 39 thereof, that a subordinate legislation, when validly made, becomes part of the parent act, and the employer corporation is bound to comply with the mandatory provisions of the statute or the regulations framed thereunder. [The main aspects dealt with in decisions as in Rajasthan State Road Transportation Corporation & Anr. v. Krishna Kant & Ors. [ (1995) 5 SCC 75 ] (3 Judges' Bench), Rajasthan State Road Transport Corporation & Anr. v. Bal Mukund Bairwa (2) [ (2009) 4 SCC 299 ] (3 Judges' Bench), Rajasthan State Road Transport Corporation & Ors. v. Deen Dayal Sharma [ (2010) 6 SCC 697 ] (2 Judges' Bench) are that certified standing orders framed in accordance with the Industrial Employment (Standing Orders) Act, 1946, are statutorily imposed conditions of service and are binding both upon the employers and employees, though they do not amount to ‘statutory provisions’, and as to the effect of violation of those standing orders and the reliefs that could be sought for before the appropriate forum, etc. Those aspects have no relevance to the present cases.] 100. However, it is to be noted, that in Deen Dayal Sharma's case supra [ (2010) 6 SCC 697 ], the Apex Court has again reiterated the legal position settled in paras 38 & 39 of Bal Mukund Bairwa’s case supra [ (2009) 4 SCC 299 ] {See para 11 of Deen Dayal Sharma's case supra}. So, it can been seen, that the legal position settled by the Apex Court in paras 38 & 39, more particularly in para 39 of Bal Mukund Bairwa’s case supra, is broadly in consonance with the legal position settled in the concluding part of para 17 of S. N. Goyal's case supra [ (2008) 8 SCC 92 ] quoted hereinabove.
So, it can been seen, that the legal position settled by the Apex Court in paras 38 & 39, more particularly in para 39 of Bal Mukund Bairwa’s case supra, is broadly in consonance with the legal position settled in the concluding part of para 17 of S. N. Goyal's case supra [ (2008) 8 SCC 92 ] quoted hereinabove. In other words, these two decisions are also broadly in consonance with the legal perspectives in paras 33 & 34 of the concurring judgment of the Apex Court in Vaish Degree College's case supra [ (1976) 2 SCC 58 ], to the effect that it may not be very material or relevant as to whether the employer body is a statutory body or a non statutory body, but as to whether the impugned dismissal or termination of service of the employee has been rendered in breach or contravention of the mandate of statutory provisions, etc. Ramswarup Gupta v. M. P. State Co-operative Marketing Federation Ltd. & Ors. [ AIR 1976 MP 152 (FB)] ( "Ramswarup's case" for short ) 101. The Full Bench of the Madhya Pradesh High Court, in Ramswarup's case supra, while considering the provisions contained in the M. P. Co-operative Societies Act, 1961, has held in para 3 thereof, that before any institution can be said to be a statutory body, it must be created by a Statute and must owe its existence to the Statute and it will be necessary to mark a distinction between an institution, which is not created by or under a Statute but is governed by certain statutory provisions for the proper maintenance and administration of its affairs, and the one which is created by the statute and owes its existence to the same. That there are a number of institutions, which, though not created by or under any statute, are, after formation, governed by certain statutory provisions regulating their affairs. Simply by doing so, they do not become statutory bodies. For instance, a company being incorporated, in accordance with the provisions of the Companies Act, cannot be said to be a body created by the Companies Act. A company so registered and incorporated, in accordance with the provisions of the Companies Act, cannot be a statutory body, because it is not created by the Statute.
For instance, a company being incorporated, in accordance with the provisions of the Companies Act, cannot be said to be a body created by the Companies Act. A company so registered and incorporated, in accordance with the provisions of the Companies Act, cannot be a statutory body, because it is not created by the Statute. It is nothing but a body created in accordance with and governed by the provisions of the Statute. The same is the case of a Co-operative Society, registered under the provisions of the Co-operative Societies Act, and such a co-operative society cannot be said to be a statutory body, like the Oil and Natural Gas Corporation or the Life Insurance Corporation, which owe their existence to the Statute itself and have been created by the Statute, as referred to in Sukhdev Singh's case supra [ (1975) 1 SCC 421 ]. 102. In para 4 thereof, it was held by the Full Bench of the Madhya Pradesh High Court, that, normally, such co-operative societies may not be amenable to writ jurisdiction of the High Court, except in cases where, according to the provisions of the statute or rules or regulations framed under the Act, by which the Society is governed, there is a statutory or public duty imposed on it, and the enforcement of which is being sought, and that Co-operative society may be amenable to writ jurisdiction only in cases wherein due performance of public or statutory duty is imposed by a statute, creating a corresponding legal right and interest. In para 6 of Ramswarup's case supra, the Full Bench construed the impact of Sec.55 of the M. P. Co-operative Societies Act and sub-section (1) contained a mandate that the Society shall comply to such rules or orders issued by the Registrar and Sec. 55(2) provided a forum for deciding a dispute regarding the terms of employment, working conditions and the disciplinary action taken by the Society, which may arise between the Society and its employee.
It was held therein that, according to the rules framed under Sec.55(1) of the Act or direction issued by the Registrar, in exercise of the powers thereunder, there are provisions governing the terms of employment of any servant of the society and they prohibit the society from dismissing its employees, without complying with the requirements, as stated in the rules and if the society terminates the services of its employee, without complying the same, the employee concerned can always approach the High Court for enforcing the legal right, which has been created in his favour, due to the corresponding legal obligation and duty imposed on the society to act in a particular manner. Such an employee will approach the Court, not for enforcement of contract of service, but for the enforcement of the legal right, created in his favour, by virtue of the provisions that he could not be dealt otherwise in the matter of his employment in violation of the provisions of the rules. However, if there is no such rule or statutory provisions, regarding the terms of employment of a particular employee, the same will be definitely governed by the general law of master and servant and since it will not be a case of breach of any statutory provision or failure to perform a legal obligation or legal duty imposed by law, such an employee cannot approach the High Court for claiming a writ for reinstatement or directions to the Society to deal with him in any particular manner. Sevaram Totaram Pargir v. Board of Revenue, M. P., Gwalior & Anr. [1983 LAB IC 1565 ( FB)] ( “Sevaram's case” for short ) 103. Construing the provisions of Sec. 55 of the M. P. Co-operative Societies Act, the Full Bench of the Madhya Pradesh High Court held, in para 4 of Sevaram's case supra, that Section 55(2) authorizes the Registrar or any other officer appointed by him, not below the rank of the Assistant Registrar, to “decide” a dispute referred to him, regarding disciplinary action taken by the society against his employees and this may also include a decision whether the disciplinary action was in contravention of the rule framed under Section 55(1) of the Act.
If the Registrar, hearing such a dispute, finds that the disciplinary action is in breach of the rules, it cannot be denied that he will have jurisdiction to set aside that disciplinary action, including the dismissal of the employee. This would only mean conceding jurisdiction to the authority appointed under section 55(2), when seized of a dispute referred to thereunder, a right to declare the action of the employer illegal, being in contravention of the statutory rules. The necessary consequence of setting aside the dismissal or removal of an employee, in breach of the rules, is that the employee is restored back to his status, which he had vis-a-vis his employer (society), before the termination of his services. The authority hearing the dispute under section 55(2) must, therefore, be held to have that power and jurisdiction to direct the restoration of such status, which would only mean that it shall have the jurisdiction to direct reinstatement of the employee the moment it concludes that the action of the employer (society), in dismissing and/or removing its employee, is in breach of the statutory rules. K. C. John v. Liquidator [ 2006 (1) KLT 11 (FB)] ( “John's case” for short ) 104. The Full Bench of this Court has held in para 8 of John's case supra, that the words "person or authority" used in Article 226 of the Constitution of India are not only confined to statutory authorities and instrumentalities of the State [as conceived in Article 12 of the Constitution], and that the form of the body concerned may not be very relevant and what is relevant is the nature of the duty imposed on the body and the duty must be adjudged, in the light of positive obligation owned by the person or authority to the affected party. No matter by what means the duty is imposed, if a positive obligation exists, mandamus cannot be denied, as held in Praga Tools Corporation's case [ (1969) 1 SCC 585 ]. In other words, to be enforceable by mandamus, under Article 226, a public duty does not necessarily have to be one imposed by statute. A mandamus, as per Article 226, can be issued even in a case of breach of duties imposed by Charter, common law, custom or even contract, because, mandamus is a very wide remedy, etc. 105.
In other words, to be enforceable by mandamus, under Article 226, a public duty does not necessarily have to be one imposed by statute. A mandamus, as per Article 226, can be issued even in a case of breach of duties imposed by Charter, common law, custom or even contract, because, mandamus is a very wide remedy, etc. 105. The Full Bench of this Court, in para 12 of John's case supra, has placed reliance on the decision of the Apex Court in U.P. State Co-operative Land Development Bank Ltd. v. Chandra Bhan Dubey [ (1999) 1 SCC 741 ]. Association of MILMA Officers v. State of Kerala [ 2015 (1) KLT 849 (LB)] (“MILMA Officers' case” for short) 106. A Larger Bench of Five Judges' of this Court in MILMA Officers' case supra, after placing reliance on the dictum laid down by the Full Bench of this Court in John's case supra [ 2006 (1) KLT 11 ], and that of the Apex Court in A.Umarani v. Registrar, Co-operative Societies & Anr. [ (2004) 7 SCC 112 ] as well as that of the Apex Court in U.P. State Co-operative Land Development Bank Ltd. v. Chandra Bhan Dubey [ (1999) 1 SCC 741 ] has held that writ remedy may lie against a Co-operative Society when the duty owned by the Co-operative Society is of a public nature or when there is a contravention of any statutory rules by a Co-operative Society. On facts, it was held by the Full Bench in MILMA Officers' case supra in para 16 thereof, that the staff regulations, relied on in that case, was not shown to be a statutory regulation, framed in exercise of any statutory power and so the said staff regulations, being not of statutory nature, the violation of such non statutory provisions could not be the subject matter of challenge. 107. In this regard, it may be pertinent to refer to paras 29 & 30 of the earlier Full Bench ruling of this Court in P.Bhaskaran & Ors. v. Additional Secretary & Ors. [ 1987 (2) KLT 903 (FB)] that Co-operative Societies are not created by the Co-operative Societies Act and that they are not statutory bodies. They are only functioning in accordance with the provisions of the Act. These institutions would have legal existence even if the Co-operative Societies Act was not in force.
v. Additional Secretary & Ors. [ 1987 (2) KLT 903 (FB)] that Co-operative Societies are not created by the Co-operative Societies Act and that they are not statutory bodies. They are only functioning in accordance with the provisions of the Act. These institutions would have legal existence even if the Co-operative Societies Act was not in force. Moreover, the Government has no shares in the Co-operative Societies. There is no deep and pervasive State control. The management of the societies does not vest in the Government or in the representatives of the Government. The management is under the effective control of a committee elected by the members of the societies. The statutory regulation or restriction, in the functioning of the societies, is not “an imprint of State under Art. 12”. The Co-operative Society may not fulfill the definition of 'State' as per Article 12. Therefore, no writ under Article 226 would lie against the Co-operative Society, governed by the Kerala Co-operative Societies Act. 108. The Larger Bench of this Court in MILMA Officers' case supra [ 2015 (1) KLT 849 (LB)] has held that the Writ Petitions against Co-operative Societies are maintainable in certain circumstances, where the action complained of is any statutory violation on the part of the Co-operative Society or the action of the Co-operative Society falls in a public domain or breach of public duty and that, in the absence of breach of any statutory duty or public duty, a Writ Petition cannot be entertained against a Co-operative Society. It was also held in the supra Larger Bench that the Full Bench decision in K. C. John v. Liquidator [ 2006 (1) KLT 11 (FB)] has laid down the correct law and the Larger Bench approves the said decision. However, it was also held by the Larger Bench in MILMA Officers' case supra, that the earlier decision of the Full Bench in P.Bhaskaran & Ors. v. Additional Secretary & Ors. [ 1987 (2) KLT 903 (FB)] confines to only consideration of a Co-operative Society under Article 12 of the Constitution and in regard to it, a writ petition cannot be maintainable against a Co-operative Society on that basis. But that, the writ proceedings could be maintainable against a Co-operative Society, in cases of contravention or breach of statutory duty or public duty, etc., as held in John's case supra.
But that, the writ proceedings could be maintainable against a Co-operative Society, in cases of contravention or breach of statutory duty or public duty, etc., as held in John's case supra. A reading of the above Larger Bench decision of this Court in MILMA Officers' case supra and that of the earlier Full Bench decision of this Court in P.Bhaskaran's case supra would indicate that the view taken by the earlier Full Bench, in para 29 of P.Bhaskaran's case supra [ 1987 (2) KLT 903 (FB)], to the extent that Co-operative Societies are not created by the Co-operative Societies Act and so, they are not statutory bodies, etc., has not been in any manner modified or diluted. A.Umarani v. Registrar, Co-operative Societies & Anr. [ (2004) 7 SCC 112 ] ( “Umarani's case supra” for short ) 109. A Three Judges' Bench of the Apex Court, in para 60 of Umarani's case supra, has held that their Lordships of the Supreme Court do not intend to express any opinion as to whether the co-operative society is a “State”, within the meaning of Article 12 of the Constitution of India, but that it is beyond any cavil of doubt that the writ petition will be maintainable when the action of the co-operative society is violative of mandatory statutory provisions.(Emphasis supplied) Inter alia, it was also held therein, that in the facts of the case, the State had no administrative control over the day-to-day affairs of the co-operative society considered therein, except the nodal center functions and supervisions of the co-operative society, and that the State has not created any post nor could it do so on its own, and that the State has not borne any part of its financial burden, and therefore it was impermissible for the State to direct regularisation of the services of the employees of the Co-operative societies. Akalakunnam Village Service Co-operative Bank Ltd. & Anr. v. Binu N. & Ors. [ (2014) 9 SCC 294 ] (“Akalakunnam Village Service Co-operative Bank's case” for short) 110. These cases arose out of the judgments of this Court concerning irregularities in the selection by way of direct recruitment to certain posts in the Co-operative Societies concerned therein, on the ground that the impugned selection was in violation of the guidelines issued by the Registrar under Rule 182(5) of the Kerala Co-operative Societies Rules.
These cases arose out of the judgments of this Court concerning irregularities in the selection by way of direct recruitment to certain posts in the Co-operative Societies concerned therein, on the ground that the impugned selection was in violation of the guidelines issued by the Registrar under Rule 182(5) of the Kerala Co-operative Societies Rules. The learned Single Judge of this Court held, that the selection notification and the impugned selection process, for direct recruitment, in those cases were in violation of the guidelines and circulars issued by the Registrar under Rule 182(5) of the Kerala Co-operative Societies Rules, and hence, had quashed the selection notification and impugned selection process, and directed the Co-operative Bank to conduct selection afresh, after inviting applications, in accordance with the guidelines and circulars issued by the Registrar of Co- operative Societies, in terms of the above said statutory rules. The said judgment of the learned Single Judge was confirmed in Writ Appeal and the matter was taken up before the Apex Court, which led to the aforecited decision. 111. The decision of this Court that the impugned action of the Co-operative Societies, being in contravention of the statutory guidelines, could be interdicted, etc. was upheld by the Apex Court. In that case, what was involved was the violation of guidelines and circulars issued by the Registrar of Co-operative Societies, in terms of the mandate contained in Rule 182(5) of the Kerala Co-operative Societies Rules, in the matter of selection by way of direct recruitment of open market candidates, to the posts covered in that Rule. In other words, it has been held that the impugned action of the Society could be interdicted where it is in breach or contravention of the statutory norms. Incidentally, it has also been held therein that the dispute regarding the alleged selection irregularities, committed by the Co-operative Society, in direct recruitment of open market candidates, cannot be the subject matter of dispute adjudication, in terms of Sec.69 of the Kerala Co-operative Societies Act. None of the present cases before this Full Bench raises the said issue, inasmuch as these cases are concerned with service disputes of in-service employees of the Co-operative Society and not alleged selection irregularities in direct recruitment of open market candidates.
None of the present cases before this Full Bench raises the said issue, inasmuch as these cases are concerned with service disputes of in-service employees of the Co-operative Society and not alleged selection irregularities in direct recruitment of open market candidates. The jurisdictional competence of the adjudicatory forum, under Sec.69 of the Kerala Co-operative Societies Act, to enter service disputes of in-service employees is now well settled, in terms of the legal position enunciated by the Apex Court in the aforecited K. A. Annamma's case supra [ (2018) 2 SCC 729 ]. U. P. State Co-operative Land Development Bank Ltd. v. Chandra Bhan Dubey & Ors. [ (1999) 1 SCC 741 ] 112. The appellant Co-operative Society therein was a Co-operative Society registered under the Uttar Pradesh Co-operative Societies Act, 1965 and was also constituted under the Uttar Pradesh Co-operative Land Development Bank Act, 1964 and was governed by two sets of Acts and Rules framed thereunder: (1) The general Act contained in the Uttar Pradesh Co-operative Societies Act and (2) The special enactment as per Uttar Pradesh Co-operative Land Development Bank Act. Sec.122 of the Uttar Pradesh Co-operative Societies Act dealt with the authority to control employees of Co-operative societies and also empowered framing of regulations by the authority to regulate recruitment, emoluments, terms and conditions of service, including disciplinary control of such employees, subject to the provisions contained in Sec.70 thereof, regarding settlement of disputes between an employee of the co-operative society and the society. The provisions in sub-section 2 thereof stipulated that regulations framed under Sub-section 1 shall be subject to the approval of the State Government and after such approval, shall be published in the Gazette and take effect from the date of publication and supersede any regulations made under Sec.121 etc. 113. Para 12 of the above decision would indicate that the State Government had constituted the Uttar Pradesh Co-operative Institutional Service Board (the Service Board), with the approval of the Governor and the U.P. Co-operative Societies Employees' Service Regulations, 1975 was also published in the U.P. Gazette. Para 14 thereof would indicate that Chapter VII of the Regulations contained provisions for penalties, disciplinary proceedings and appeals and Regulation 84 stipulated that an employee can be removed from service for which he has to be provided with the copy of the order of punishment.
Para 14 thereof would indicate that Chapter VII of the Regulations contained provisions for penalties, disciplinary proceedings and appeals and Regulation 84 stipulated that an employee can be removed from service for which he has to be provided with the copy of the order of punishment. The penalty of removal from service cannot be imposed without recourse to disciplinary proceedings and an employee cannot be removed or dismissed by an authority, other than by which he was appointed unless the appointing authority has made prior delegation of such authority to such other person or authority in writing. Regulation 85 provided details as to how disciplinary proceedings are to be conducted and any order of removal or dismissal from the service or reduction in rank or grade, held substantively by the employee, cannot be passed except with the prior concurrence of the Service Board as mandated under Regulation 87 thereof. Regulation 85 stipulated that the disciplinary proceedings against an employee shall be conducted by the enquiry officer with due observance of the principles of natural justice, which also stipulated issuance of charge sheet containing specific charges and to mention evidence in support of each charge and the opportunity of the employee to cross-examine witnesses, etc. 114. In para 21, the Apex Court has held that the exercise of power of dismissal by the appellant Co-operative Society has to be in accordance with the afore statutory regulations and with the prior approval of the statutory body, and in Sukhdev Singh's case supra [ (1975) 1 SCC 421 ], the Constitution Bench has held that regulations being framed under statutory provisions would have the force of law. In para 20 thereof, the Apex Court, while considering the provisions contained in the special enactments therein viz.
In para 20 thereof, the Apex Court, while considering the provisions contained in the special enactments therein viz. U. P. State Co-operative Land Development Bank Act and the U. P. State Co-operative Land Development Bank Rules and certain other provisions, also noted that the said co-operative society is also vested with the powers under the Bank Act (Special Act), which are not available to a co-operative society, registered merely under the Societies Act (General Enactment) and that, as per the provisions of the Bank Act (Special Act), the Registrar of the Co-operative Societies of the State of U. P. shall be the trustee for the purpose of securing the fulfillment of the obligations of the State Land Development Bank to holders of debentures, issued by the Board of Directors, and the powers and functions of the trustee shall be governed by the provisions of the Bank Act, and the instrument of trust should be executed between the appellant Society and the trustee, as modified or substituted from time to time by their mutual agreement and with the prior approval of the State Government, etc. And that the trustee is to be a corporation sole and also held that the said U. P. State Co-operative Land Development Bank Ltd. is an extended arm of the State and thus, an instrumentality of the 'State' or authority, so as to fulfill the definition of 'State' as per Article 12 of the Constitution of India. 115. These issues regarding the applicability of 'Article 12' tests may not have relevance in the present cases before this Full Bench, inasmuch as there is no dispute that the Co-operative Societies concerned in these cases may not fulfill the definition of 'State' as per Article 12 and what is more important is whether the impugned action of the Co-operative Society is in contravention of the statutory mandate. 116. It has been further held by the Apex Court, in paras 22 to 26 of U. P. State Co-operative Land Development Bank's case supra that, where the impugned action of dismissal by a Co-operative Society is in breach of the statutory provisions contained in the Rules, etc. then interdiction given by writ remedy under Article 226 is feasible.
116. It has been further held by the Apex Court, in paras 22 to 26 of U. P. State Co-operative Land Development Bank's case supra that, where the impugned action of dismissal by a Co-operative Society is in breach of the statutory provisions contained in the Rules, etc. then interdiction given by writ remedy under Article 226 is feasible. In other words, it is to be noted that, even if a Co-operative Society is not an 'instrumentality or other authority', so as to fulfill the definition of 'State' as per Article 12 where the impugned action of the Co-operative Society, like dismissal of an employee, etc., is in contravention of the provisions contained in the Rules framed under the Act, then the same could be interdicted, even in writ proceedings under Article 226. Ram Sahan Rai v. Sachiv Samanaya Prabandhak & Anr. [ (2001) 3 SCC 323 ] 117. In this case, it was held that the status of the defendant District Co-operative Bank is of a co-operative society registered under the U. P. Co-operative Societies Act, 1965 and the aforementioned U. P. Co-operative Land Development Bank Act, 1964. It has been inter alia held therein, by the Apex Court, that removal from service of an employee, from the service of such a Co-operative Society, for alleged misconduct, without following the mandatory provisions of rules and regulations and principles of natural justice, would attract the third exception to the rule of non-enforceability of contract of personal service and that therefore, the High Court erred in holding that the civil suit, challenging the order of removal so passed, was not maintainable. The Apex Court has also found therein that the defendant District Co-operative Bank-employer therein was an instrumentality of the State, as per Art. 12. Dr. John Kuriakose v. State of Kerala [ 2015 (1) KLT 720 (FB)] ("Dr. John Kuriakose's case" for short) 118. Dr. John Kuriakose's case has been rendered by a Full Bench of this Court considering the termination of service of a Principal of a private aided college affiliated to the Mahatma Gandhi University, whose initial appointment as Principal by the Management was duly approved by the University, in terms of the statutory provisions and regulations framed under the University Act.
Dr. John Kuriakose's case has been rendered by a Full Bench of this Court considering the termination of service of a Principal of a private aided college affiliated to the Mahatma Gandhi University, whose initial appointment as Principal by the Management was duly approved by the University, in terms of the statutory provisions and regulations framed under the University Act. Statute 75 of the University Statutes, framed under the University Act, provided for the procedure of imposition of major penalty and this procedure was made applicable to private institutions, both minority and non-minority. The impugned termination of service of the petitioner therein was found to be in contravention of the University Statutes, which regulates the manner and method of taking disciplinary action for the imposition of penalty and consequent termination of service, etc. The Full Bench, after consideration of the various provisions of the Mahatma Gandhi University Act and the statutes and regulations framed thereunder, found that the selection and appointment of teachers and Principals, of even minority private aided colleges, which is receiving aid from the Government and affiliated to the University, has to be regulated according to the provisions of the statute and the contention of the Management, that the minority institution has unfettered freedom and discretion, in termination of services of the teachers and principals, whose appointments have been approved by the University, was negatived. 119. The Full Bench in Dr. John Kuriakose's case has specifically relied on the dictum laid down by the Four Judges' decision in P. R. Jodh's case supra [ (1965) 2 SCR 713 ] and has also noted that the subsequent ruling of the Apex Court in the Three Judges' Bench decision in Vidya Ram Misra v. Managing Committee, Shri Jai Narain College [ (1972) 1 SCC 623 ] wherein, it was noted, in the latter portion of para 9 thereof, that the 4 Judges' Bench in P. R. Jodh's case supra came to the conclusion that the College Code had the force of law and conferred rights on teachers of affiliated colleges and the right to challenge the order, terminating service of the teacher, passed in violation of the provision of the said College Code, followed “as the night the day” and the fact that the appellant had entered into a contract was considered as immaterial etc. 120.
120. The Full Bench has also noted that, in para 7 of P. R. Jodh's case supra, the issue raised by the appellant college therein, that the governing body was not a statutory body performing public duties, etc., was not earlier raised before the High Court and hence, the Apex Court is unable to entertain the said preliminary objection, as to whether or not the governing body of the college therein is a non statutory body. A detailed discussion has been made in paras 20 to 25 thereof about the decisions of the Apex Court in P. R. Jodh's case supra, Vidya Ram Misra's case supra etc. Ultimately, it was held by the Full Bench, in para 25 thereof, that in view of the ratio decidendi laid down in the 4 Judges' decision of the Apex Court in P. R. Jodh's case supra, interdiction, even by judicial review under Article 226, could be entertained at the instance of a teacher of a private aided college affiliated to the University, whose service conditions are governed by statutory provisions, etc. 121. In other words, the Full Bench has clearly held therein that, where the impugned action of dismissal, termination of service of a teacher of a private aided college affiliated to the University is in breach of statutory mandate, then, interdiction by the Court is justified. However, in that case, since the petitioner therein was out of service for a long period and his impending superannuation from service was very near, the Full Bench did not grant the relief of reinstatement of service, but only ordered that the College Management should pay compensation, by way of payment of a lump sum amount of Rupees Fifty Lakhs, in lieu of the salary, which the petitioner would have received, if he had been in service. The Apex Court, in SLP (C) No. 7478/2015, found that there are no grounds to interfere with the impugned judgment of the Full Bench in Dr. John Kuriakose's case, but reduced the compensation to be paid to Rupees Ten lakhs and to pay the other outstanding dues payable to him. Union of India v. Millenium Mumbai Broadcast (P) Ltd. [ AIR 2006 SC 2751 = (2006) 10 SCC 510 ] ("Millenium Mumbai's case" for short) 122.
John Kuriakose's case, but reduced the compensation to be paid to Rupees Ten lakhs and to pay the other outstanding dues payable to him. Union of India v. Millenium Mumbai Broadcast (P) Ltd. [ AIR 2006 SC 2751 = (2006) 10 SCC 510 ] ("Millenium Mumbai's case" for short) 122. The above decision in the Civil appeal before the Apex Court arose out of the judgment and order of the Telecom Disputes Settlement and Appellate Tribunal. The matter relates to the construction of the agreement and license to operate FM Broadcasting service and the clause regarding the revocation of license. The Apex Court has inter alia held, in para 33 of the said decision, that provisions of the Specific Relief Act would not apply to contracts which are governed by statutory provisions. On this basis, the Apex Court has rejected the contention of the Union of India that the impugned direction issued by the Tribunal therein was contrary to Sec.14(1)(c) of the Specific Relief Act, 1963 which stood then, which dealt with a contract, which in its nature is determinable. Resolution of the main issue regarding the correctness or otherwise of the dictum laid down by the Division Bench of this Court in Ambika's case supra [ 2018 (3) KLT 779 (DB)] 123. The Division Bench of this Court in Ambika's case supra has mainly placed reliance on paras 9 & 10 of the decision of the Apex Court in Prabhakar Sitaram's case supra [ (2017) 5 SCC 623 ] to come to the conclusion that, since the adjudicatory Forum, under Sec.69 of the KCS Act, is co-terminus with the jurisdictional civil court, such an adjudicatory Forum cannot specifically enforce a contract of personal service, as it is barred by Sec. 14 read with Sec. 41(e) of the Specific Relief Act, 1963. 124. In Prabhakar Sitaram's case supra [ (2017) 5 SCC 623 ], the Apex Court was deciding the issue as to whether the adjudicatory Forum, under Sec.91 of the Maharashtra Co-operative Societies Act, is having the competence to entertain a petition for service disputes of employees of such co-operative societies.
124. In Prabhakar Sitaram's case supra [ (2017) 5 SCC 623 ], the Apex Court was deciding the issue as to whether the adjudicatory Forum, under Sec.91 of the Maharashtra Co-operative Societies Act, is having the competence to entertain a petition for service disputes of employees of such co-operative societies. The Apex Court, in para 13 of Prabhakar Sitaram's case supra [ (2017) 5 SCC 623 ], has categorically held that, going by the provisions contained in the said Maharashtra Act, service disputes between the employees of such co-operative societies and the management of the society are not covered by Sec.91 thereof and that the context in which the word “officers”, used in Sec.91(1) of the Maharashtra Act, is altogether different, namely, it is in the context of election of the committee of its officers and the word “officers” appearing therein has reference to elections and it is in the same hue that the word “officer” is used a second time as well in clause(a) of Sec.91(1). 125. After considering the various provisions of the Maharashtra Act and the Rules, it has been held by the Apex Court that, the power of adjudication conferred on the Registrar, as per Sec.91 of the Maharashtra Act, will not cover service disputes between employees and management of Co-operative societies. Further, in para 11 thereof, the Apex Court, after referring to the provision contained in Sec.91 of the Maharashtra Act, has also observed that some of the States have statutes which contain provisions regarding management regulations of the co-operative society, where specific machinery, under these respective State Co-operative Societies Acts, is provided for the resolution of employment disputes as well, between the Co-operative societies and its employees and even by excluding the applicability of labour laws. After referring to the case laws on those aspects, the Apex Court has also clearly held, in the concluding portion of para 11 thereof that, ultimately, the outcome depends upon the powers that are given to the Co-operative Court or the stipulated Tribunal under the respective State Co-operative Societies Acts (see para 11 on page 631 of the SCC report).
After referring to the case laws on those aspects, the Apex Court has also clearly held, in the concluding portion of para 11 thereof that, ultimately, the outcome depends upon the powers that are given to the Co-operative Court or the stipulated Tribunal under the respective State Co-operative Societies Acts (see para 11 on page 631 of the SCC report). So also, the Apex Court has also categorically held, in the latter portion of para 20 thereof (see page 634 of the SCC report), that their Lordships may hasten to add that, if the provision is couched in a language, to include such service disputes (and that in that regard such provisions are contained in the Co-operative Societies Acts of certain States) and if it is found that the Co-operative Society Act provides for a complete machinery for the redressal of grievances of the employees, then even the jurisdiction of the Labour Court/Industrial Tribunal, under the Industrial Disputes Act, shall be barred, having regard to the provisions of such special statutes vis-a-vis the general statutes like the ID Act. It may be pertinent to refer to some of the relevant portions of paras 11 & 20 thereof, which reads as follows : “11. ...................................... We may also mention at this stage that some of the States have statutes which contain provisions regarding management and regulations of the Co-operative society, where specific machinery under these State Co-operative Societies Acts is provided for resolution of employment disputes as well, between the Co-operative societies and its employees, ....................................Ultimately, the outcome depends upon the powers that are given to the Co-operative Court or the stipulated tribunal created under such Acts. ............................” “20. .......................................We may hasten to add that if the provision is couched in a language to include such disputes (and we find such provisions in the Co-operative Societies Acts of certain States) and it is found that the Co-operative Society Act provides for complete machinery of redressal of grievances of the employees, then even the jurisdiction of the Labour Court/Industrial Tribunal under the Industrial Disputes Act shall be barred having regard to the provisions of such a special statute vis-à-vis general statute like the Industrial Disputes Act...........................” 126. Paras 9 & 10 of Prabhakar Sitaram's case supra [ (2017) 5 SCC 623 ] read as follows : “9. We may also clarify one more aspect.
Paras 9 & 10 of Prabhakar Sitaram's case supra [ (2017) 5 SCC 623 ] read as follows : “9. We may also clarify one more aspect. Contract of personal services is not enforceable under the common law. Section 14, read with Section 41(e) of the Specific Relief Act, 1963, specifically bars the enforcement of such a contract. It is for this reason the principle of law which is well established is that the civil court does not have the jurisdiction to grant relief of reinstatement as giving of such relief would amount to enforcing the contract of personal services. However, as laid down in the cases referred to above, and also in [Vaish Degree College v. Lakshmi Narain, (1976) 2 SCC 58 : 1976 SCC (L&S) 176] , there are three exceptions to the aforesaid rule where the contract of personal services can be enforced: (a) in the case of a public servant who has been dismissed from service in contravention of Article 311 of the Constitution of India; (b) in the case of an employee who could be reinstated in an industrial adjudication by the Labour Court or an Industrial Tribunal; and (c) in the case of a statutory body, its employee could be reinstated when it has acted in breach of the mandatory obligations imposed by the statute. 10. Even when the employees falling under any of the aforesaid three categories raise dispute qua their termination, the civil court is not empowered to grant reinstatement and the remedy would be, in the first two categories, by way of writ petition under Article 226 of the Constitution or the Administrative Tribunal Act, as the case may be, and in the third category, it would be under the Industrial Disputes Act. An employee who does not fall in any of the aforesaid exceptions cannot claim reinstatement. His only remedy is to file a suit in the civil court seeking declaration that termination was wrongful and claim damages for such wrongful termination of services. Admittedly, the appellant Corporation is not “State” under Article 12 of the Constitution. The respondent also cannot be treated as a government/public servant as he was not under the employment of any Government.
His only remedy is to file a suit in the civil court seeking declaration that termination was wrongful and claim damages for such wrongful termination of services. Admittedly, the appellant Corporation is not “State” under Article 12 of the Constitution. The respondent also cannot be treated as a government/public servant as he was not under the employment of any Government. He was also not “workman” under the Industrial Disputes Act as he was working as Manager with the appellant Corporation.” There is no dispute that a civil court is barred from specifically enforcing a contract of personal service, in view of the provisions contained in Sec.14(c) (as it now stands amended), read with Sec.41(e) of the Specific Relief Act, 1963. Sec.14 of the SR Act, 1963 deals with contracts which are not specifically enforceable. Clause (c) of Sec.14 of the SR Act reads as follows : “Sec.14. Contract not specifically enforceable.- The following contracts cannot be specifically enforced, namely:- (a) …................................. (b) …................................. (c) a contract which is so dependent on the personal qualifications of the parties that the Court cannot enforce specific performance of its material terms; and (d) ….............................” Clause (e) of Sec.41 of the SR Act reads as follows : “Sec.41. Injunction when refused.- An injunction cannot be granted – (a) …............................. (b) …............................. (c) …............................. (d) …............................ (e) to prevent the breach of a contract the performance of which would not be specifically enforced; (f) …........................... (g) …........................... (h) …........................... (i) …........................... (j) …...........................” 127. Going by the well-established legal position, the bar contained in the Specific Relief Act for a civil court to enforce a contract of personal service, is subject to three broad exceptions - (1) where a government servant has been dismissed from service in contravention of Article 311 of the Constitution of India or any law made under Article 309 of the Constitution of India, etc. (2) where an employee, who is a workman, as per the Industrial Disputes Act, could be reinstated in service, consequent to adjudication by the Labour Court of the Industrial Tribunal. (3) where a statutory body has terminated the service of its employee in breach of mandatory obligations imposed by the statutory provisions, including statutory rules, then the Court could order the reinstatement of such an employee.
(3) where a statutory body has terminated the service of its employee in breach of mandatory obligations imposed by the statutory provisions, including statutory rules, then the Court could order the reinstatement of such an employee. {see Privy Council decision in I.M.Lall's case supra [AIR 1948 PC 149 (Privy Council)], Mafatlal Narain Das's case supra [ AIR 1966 SC 1364 – Constitution Bench], Sirsi Muncipality's case supra [ (1973) 1 SCC 409 – Constitution Bench], Sukh Dev Singh's case supra [ (1975) 1 SCC 421 – Constitution Bench], Vaish Degree College's case supra [ (1976) 2 SCC 58 ], U.P Warehousing Corporation's case supra [ (1980) 3 SCC 459 ], etc.} 128. Vaish Degree College's case supra [ (1976) 2 SCC 58 ] has considered whether there are further extensions of the above said three exceptions to the general bar, especially in relation to dismissal or termination of service of employees of non-statutory bodies, which is in breach of statutory rules. As discussed hereinabove, in para 19 of Vaish Degree College's case supra [ (1976) 2 SCC 58 ], the Apex Court has referred to the issue of extension of the three exceptions, by way of a fourth category, inasmuch as the private college considered therein was held to be a non-statutory body and cases of dismissal of employees of a non-statutory body, etc. However, in para 20 thereof, the majority judgment has not finally decided the said issue, regarding the exception in the case of non-statutory bodies, acting in breach of statutory provisions, but held that, even if it is assumed so, for argument sake, still the said case was not a fit and proper case to exercise discretion for grant of the relief of declaration and injunction. Thereafter, the majority judgment has proceeded to award a compensation of Rs.21,000/- to the plaintiff therein. The concurring judgment also holds that, in the peculiar facts of that case, the plaintiff is not otherwise entitled for the discretionary relief of injunction and declaration and the ends of justice would be subserved by awarding him a fair and just compensation of Rs.21,000/-.
The concurring judgment also holds that, in the peculiar facts of that case, the plaintiff is not otherwise entitled for the discretionary relief of injunction and declaration and the ends of justice would be subserved by awarding him a fair and just compensation of Rs.21,000/-. Further, the concurring judgment has held that, while considering the exceptions to the bar of specific performance, contained in the Specific Relief Act, it is immaterial as to whether the employer body is a statutory body or a non-statutory body (see paras 33 & 34 of Vaish Degree Colleges's case supra). 129. Thereafter, the concurring judgment has held that, irrespective as to whether the employer body is a statutory body or a non-statutory body, the provision of law enacted in the section in the University Act concerned, which mandated restrictions on dismissal, etc., would apply and operate irrespective as to whether the management of the college is or is not a statutory body and that, when the termination of service of the employee is in contravention of the statutory mandate, it would result in statutory invalidity of such dismissal orders. The crucial aspect of the legal position enunciated in the concurring judgment of Justice P.N.Bhagwati (as His Lordship then was) is that, it is immaterial as to whether the employer body is a statutory or non-statutory and what is important is whether there is a contravention of the statutory mandate, etc. Further, as held consistently in the various aforecited case laws, where it is found that the impugned dismissal or termination from service is in contravention of the statutory mandate, then the courts could only declare the statutory invalidity of such impugned action and hold that it is statutorily invalid or ultra vires, etc. and correspondingly, hold that the impugned dismissal order is thus, invalid and ultra vires and legally inoperative and hence, restore the position of the employee, as it stood prior to the ultra vires order and that, in such cases, what the court orders and declares is not one of enforcement of specific performance of contract of personal service, but only a declaration that the impugned dismissal order is statutorily invalid or ultra vires, as it is in contravention of the mandatory statute.
So, the main issue involved in these cases is as to whether there could be extensions to the three exceptions carved out in the case laws referred to hereinabove and whether such an exception would involve the case of dismissal or termination of service of an employee of a non-statutory body in contravention of the mandate of the statutory rules framed under the Act. 130. An overview of the provisions of the Kerala Co-operative Societies Act and Rules have been dealt with in the earlier portions of this judgment. Sec.9 mandates that the registration of a Co-operative Society shall render it into a body corporate. The provisions of the Act and Rules, dealt with hereinabove, would clearly indicate that very wide and extensive coverage of statutory provisions have been made to regulate various aspects, commencing from recruitment, conditions of service, various service benefits like gratuity, provident fund, pension, pension scheme, wages, pay and allowances and various other financial and service benefits, norms for promotion and direct recruitment, qualifications for appointment and also provisions for statutory protection, even in discharge of a probationer, various aspects of disciplinary action, including suspension, enquiry process, imposition of minor/major penalties, etc. The provisions contained in the Kerala Co-operative Societies Act and Rules are quite unlike the provisions contained in the Maharashtra Co-operative Societies Act and the Rules framed thereunder, about which reference has also been made by the Apex Court in Prabhakar Sitaram Bhadange's case supra [ (2017) 5 SCC 623 ]. 131. Suffice to say, the provisions of the Kerala Co-operative Societies Act and Rules regulate various aspects from "cradle to grave" in the service life of an employee of a co-operative society, right from the commencement of the birth of an employee in the establishment up to the day he/she demits employment and even thereafter, in the matter of retirement benefits, etc. 132. The Apex Court has already held in the decisions, as in Umarani's case supra [ (2004) 7 SCC 112 ], Akalakunnam Village Service Co-operative Bank's case supra [ (2014) 9 SCC 294 ] etc., that the impugned action of the co-operative society, in violation and contravention of the provisions contained in the Act and Rules framed thereunder and the circulars issued in terms of the rules, etc would invite judicial interdiction.
As a matter of fact, Akalakunnam Village Service Co-operative Bank's case supra was in respect of a co-operative society registered under the Kerala Co-operative Societies Act and Rules. 133. We are mainly concerned with disciplinary action of employees of Co-operative societies registered as per the Kerala Co-operative Societies Act and Rules. Sec.80(3) of the Act mandates that the Government shall make rules either prospectively or retrospectively regulating qualifications, remuneration, allowances and other conditions of service of the employees. Sec.80(9) also, in particular, mandates that suspension or disciplinary action in relation to an officer, employee or servant of a co-operative society shall be as such, as may be prescribed by the rules. Sec.80(8) empowers that the Government shall, by order, frame uniform Service Rules and Conduct Rules of the employees of any or all classes of the co-operative societies. Sec.109 (2) (xxxviii) authorizes the Government to frame rules either prospectively or retrospectively to carry out the purposes of the Act and also in particular to frame rules on any matter required or allowed by the Act or be prescribed by the rules. The Kerala Co-operative Societies Rules have been so framed under the enabling provisions contained in the Kerala Co-operative Societies Act. Rule 198 thereof deals with disciplinary action. Specific mandatory restrictions are placed even in the freedom of contract of the employer Co-operative society to deal with the subject matter of suspension from service, as can be seen from the restrictions imposed in Sub-rule 6 of Rule 198. Particular stipulation is made therein that, no employee shall be kept under suspension for a period exceeding 6 months at a time, and that in no case, an employee shall be kept under suspension for a continuous period exceeding one year without the prior approval of the Registrar. Further, serious inroads are also made into the freedom of contract of the employer co-operative society to regulate the suspension period, by mandating that an employee under suspension from service shall be entitled to subsistence allowance payable in terms of the Kerala Payment of Subsistence Allowance Act, 1972, subject to the proviso that, an employer not coming under the purview of the Kerala Payment of Subsistence Allowance Act, shall be entitled to subsistence allowance, at the rate admissible to State Government Employees as prescribed under the Kerala Service Rules (KSR).
So also, even in the discharge of a probationary appointee, it is stipulated in Rule 184. The first proviso to Rule 184(3) of the Kerala Co-operative Societies Rules mandates that no order of discharge of a probationer shall be passed unless the prior approval of the notified Registrar therefor has been obtained, and unless the person concerned has been given a reasonable opportunity of showing cause against the action proposed to be taken in regard to him, etc. 134.Such is the intensity and level of the statutory protection given even in the case of suspension from service of an employee or even in discharge of a probationer. The entire text of Rule 198, dealing with disciplinary action, has already been quoted hereinabove. Various penalties, imposed on the employee concerned, are dealt with in Clauses (a) to (h) of Rule 198(1). 135. The competent authorities, who alone can impose the penalties, are mentioned in the table appended under Sub-rule 3 of Rule 198. Rule 198(2) mandates that no kind of punishment shall be awarded to an employee unless he/she has been informed in writing on the grounds on which it was proposed to take action against, and he has been afforded opportunity, including personal hearing, to defend himself, and every order awarding punishment shall be communicated to the employee concerned in writing stating the grounds on which the punishment has been awarded. More crucially, Sub-rule (2B) of Rule 198 mandates that the disciplinary subcommittee, so constituted in terms of Sub-rule (2A) of Rule 198, shall enquire into the charges against the employee, either by themselves or by engaging external agencies etc. So, the heart and soul of the statutory protection granted to the employees of Co-operative Societies, are those contained in Rules 198(2) and 198(2B). Various provisions in Rule 198, more particularly the above said Sub-rules, would clearly postulate that the disciplinary subcommittee will have to conduct inquiry into the charges against the employee, either by themselves or by engaging an external agency, and the employee should be informed in writing on the grounds on which it is proposed to take action against him, and he should be afforded reasonable opportunity to defend himself, and the order imposing punishment shall state, in writing, the grounds on which the impugned penalty has been awarded, etc.
Further, the Managing Committee of a Society shall constitute a Disciplinary Sub Committee consisting of not more than 3 of its members, of whom one shall be designated as Chairman. The President of the Managing Committee of the Society shall not be the member of the Disciplinary Sub Committee. It is this Disciplinary Sub Committee, that is so constituted in terms of Sub-rule (2A), that will have to enquire into the charges against the employee, either by themselves or by engaging an external agency, as per Sub-rule (2B) supra etc. 136. Further, Rule 198(4) mandates that the Co-operative Society employer shall necessarily provide an appellate remedy to an employee, who is awarded a penalty, and the constitution of the appellate committee is also specifically mandated in that Rule. So, in other words, these statutory rules make serious inroads into the freedom of contract of a Co-operative Society employer, on various crucial aspects, including the mandatory procedure for initiation and completion of penalty proceedings, and also as to the constitution of a disciplinary subcommittee and also as to the authorities who could competently impose the penalties, and also to provide and constitute the appellate committee. In other words, no Co-operative Society, in exercise of the freedom of contract, can make any prescription to regulate the disciplinary action, in any manner, other than the one stipulated in Rule 198 as above. Prior to the introduction of Sub-rule (2A) of Rule 198, Sub-rule (3) thereof only generally mentioned about a sub committee but as to the nature of its constitution and the number of its members, etc. were not stipulated in the Rules, and it was left to the freedom of the Co-operative Societies concerned. With the introduction of Sub-rule (2A) of Rule 198, no Co-operative society has the freedom to say that they will not constitute a disciplinary sub committee or that the number of members of the said sub committee will be in the manner deemed fit by the society, etc. Whereas, now the rule stipulates that every Co-operative Society employer is under the mandatory and statutory obligation to necessarily constitute a disciplinary sub committee which cannot exceed 3, of whom 1 shall be the Chairman. But, in no case can the President of the Society be a member of the disciplinary sub committee.
Whereas, now the rule stipulates that every Co-operative Society employer is under the mandatory and statutory obligation to necessarily constitute a disciplinary sub committee which cannot exceed 3, of whom 1 shall be the Chairman. But, in no case can the President of the Society be a member of the disciplinary sub committee. So also, no Co-operative Society can have a save, that they will not provide an appellate remedy or that they will constitute the appellate committee in the manner they deem fit. By virtue of the stipulation in Rule 198(4), every Co-operative Society is under the bounden obligation to necessarily provide an appellate remedy, in the manner mandated therein, to an employee, who has been awarded a penalty, and every Co-operative Society is bound to constitute the appellate committee, etc. 137. Of course, to avoid issues of bias, it has been held that the members of the disciplinary sub committee, who have imposed the penalty, shall not be members of the appellate committee, and presumably it is in these aspects that it is stipulated in Rule 198(2A) that the President of the Managing Committee of the Society shall not be a member of the Disciplinary Sub Committee, etc. Therefore, deep and wide inroads are made in the freedom of contract of a co-operative society employer, in the manner and method of conduct of initiation and finalization of disciplinary action, right from the stage of suspension of service onwards. In the light of these aspects, we have no hesitation to hold that the prescriptions contained in Rule 198(2) are mandatory and not merely directory and the breach of the mandatory provisions of the Rules would invite invalidation. 138. We are constrained to hold so in view of the aforecited case laws, but also in view of certain case laws rendered by the Apex Court in Manmohan Singh Jaitla's case supra [1984 Supp SCC 540], Indrapal Gupta's case supra [ (1984) 3 SCC 384 ] and Vidya Dhar Pande's case supra [ (1988) 4 SCC 734 ].
138. We are constrained to hold so in view of the aforecited case laws, but also in view of certain case laws rendered by the Apex Court in Manmohan Singh Jaitla's case supra [1984 Supp SCC 540], Indrapal Gupta's case supra [ (1984) 3 SCC 384 ] and Vidya Dhar Pande's case supra [ (1988) 4 SCC 734 ]. Indrapal Gupta's case supra was in respect of a private college recognized under the U. P. Intermediate Education Act, 1921, whereby Sec. 16-G provided that every person employed in a recognised institution shall be governed by such conditions of service as may be prescribed by Regulations and that the Regulations may be made in respect of the period of probation, the conditions of confirmation and the procedure for the imposition of punishment. The regulations were made by the Board of Intermediate Education, constituted under the above Act. The Apex Court found that the so-called termination simpliciter of a probationer was, in fact, on account of alleged misconduct. Accordingly, it was held, that such termination from service of the employee which was found to be in breach of the mandatory provisions contained in Regulations 35 to 38 made thereunder in the matter of framing of charges, conduct of enquiry, imposition of penalty, etc., would render the termination order ultra vires. More crucially, it has been declared by the Apex Court, in para 6 thereof, that the above provisions, in Regulations 35 to 38 thereof, relating to the procedure to be followed before imposing punishment or dismissal or termination from service, are almost similar to those provided in Article 311(2) of the Constitution, and that the legal principles, which govern such a case should, therefore, be the same as those underlying Article 311(2) of the Constitution of India. 139. A similar view has been reiterated by the Apex Court, in cases as in Manmohan Singh Jaitla's case supra and Vidya Dhar Pande's case supra, about which reference have already been made in the preceding paragraphs. In other words, we are of the firm view that, though a Co-operative society, registered under the Kerala Co-operative Societies Act and Rules, is not a statutory body, dismissal or termination of service of an employee, in breach of the mandatory provisions contained in the said Rules, more particularly Rule 198 thereof, would render the order statutorily invalid and ultra vires.
Sec.70(3) of the Act stipulates that the Co-operative Arbitration Court shall have the powers, as are vested in a civil court under the CPC, while trying a suit in respect of the matters mentioned therein, viz., (i) summoning or enforcement of attendance of any defendant or witness and examining the witness on oath (ii) the discovery and production of any document or other material object producible as evidence (iii) reception of evidence on affidavits (iv) issuing of any commission for the examination of witness and (v) any other matter which may be prescribed. 140. Further, crucially, Sec.70(1) of the Act mandates that the Co-operative Arbitration Court, on receipt of a reference of a dispute, under Sec.69(1), shall pass an award within the stipulated time mentioned therein, in accordance with the provisions of the Kerala Co-operative Societies Act and Rules and the bye-laws made thereunder and such award shall, subject to the provisions of Sec.82, be final. Appellate remedy therefrom is made to a Tribunal constituted in terms of Sec.82. A provision similar as in Sec.70(1) as it stands now, has been introduced as per the afore Amendment Act 1 of 2000. Prior to said amendment, similar provision as in Sec.70(1), was contained in Sec.70(3) of the unamended Act, which stated that the adjudicatory authority/notified Registrar, on a reference of a dispute under Sec.69(1), shall pass award in accordance with the provisions of the Kerala Co-operative Societies Act and Rules and bye-laws made thereunder, etc. So, in other words, a specific mandate is made in Sec.70(1) that, the adjudicatory forum (which in the case of service disputes, being a non monetary dispute, will have to be adjudicated by the Co-operative Arbitration Court) should, on a reference of a dispute under Sec.69(1), shall pass award to enforce the provisions of the Act and the Rules etc. So, in other words, the adjudicatory forum has been given the mandate to render the award, in accordance with the Act and the Rules and is given the statutory power as adjudicatory authority, to interdict in decisions which are in breach and contravention of the mandate of the statute. Hence, the Co-operative Arbitration Court is under the statutory obligation to render its award in a Sec. 69 dispute, strictly in accordance with the provisions of the Act and Rules, etc., in view of the mandate contained in Sec. 70 (1) of the Act.
Hence, the Co-operative Arbitration Court is under the statutory obligation to render its award in a Sec. 69 dispute, strictly in accordance with the provisions of the Act and Rules, etc., in view of the mandate contained in Sec. 70 (1) of the Act. So, in other words, if the impugned action involves breach of statutory provisions, then the Co-operative arbitration court is under a statutory obligation to interdict with such contravention, so that the award is rendered to resolve the dispute, to enforce the statutory mandate. So, apart from the general law perspective of exceptions and extended exceptions to the bar of specific performance of contract of service, the Co-operative Arbitration Court is mandated by the Legislature to render the award in resolution of the dispute so as to enforce the statutory mandate. 141. Sec.70(1) also speaks about the “bye-laws of co-operative societies”. Sec.2(b) defines “bye-laws” to be registered bye-laws of a Co-operative society, for the time being in force. Sec.7(d) mandates that the proposed bye-laws, for registration, are not contrary to the provisions of the KCS Act & the KCS Rules. Sec. 13A of the KCS Act, which deals with the subject matter of bye-laws, mandates that every co-operative society shall make its bye-laws consistent with the provisions of the KCS Act & the KCS Rules and that no provision in the bye-laws of a co-operative society shall be contrary to the provisions of the Act and the Rules. We need not get into the issue regarding the effect of contraventions of the provisions of the bye-laws, for the purpose of this reference. Ordinarily, bye-laws of a co-operative society are non-statutory provisions. But, certain bye-laws framed by the society, on account of the mandate contained in the Rules, may have some bearing on the adjudication of service disputes, in terms of Sec.69(1). Rule 196 of the KCS Rules envisages framing of rules by the societies and it stipulates that necessary bye-laws shall be framed and implemented by the societies, regarding the duties and responsibilities of the employees, not inconsistent with the provisions of the KCS Act and other Acts relevant to it.
Rule 196 of the KCS Rules envisages framing of rules by the societies and it stipulates that necessary bye-laws shall be framed and implemented by the societies, regarding the duties and responsibilities of the employees, not inconsistent with the provisions of the KCS Act and other Acts relevant to it. So, in a case where issues raised in Sec.69 (1) dispute before the Co-operative Arbitration Court, as to whether the allegations of dereliction of duty or misconduct, etc., are made out, then the stipulations in the bye-laws framed by the mandate of Rule 196, regarding the duties and responsibilities of the employees, etc., may have direct or intimate bearing, on issues as to whether dereliction of duties and responsibilities or misconduct have arisen in a particular case, etc. So also, the second limb of Rule 185, which deals with promotion, mandates that feeder categories, for the purpose of promotion, shall be specified by the Society, by framing suitable regulations with the approval of the Registrar. If such regulations are framed by the Co-operative Society, with the approval of the Registrar, laying down the feeder categories for the purpose of promotion, then service disputes relating to promotion, etc., will be intimately or even directly connected with the issues of the feeder categories envisaged, as per the regulations framed by the Society, in terms of Rule.185. So, these norms may be framed by the co-operative society themselves, but on account of the mandate contained in the Rules or the Act, may have direct bearing on the issues to be resolved in the disputes before the Co-operative Arbitration Court under Sec.69(1). Thereunder, by virtue of the stipulations in Sec.70(1), the Co-operative Arbitration Court may have to examine the impact of such bye-laws or regulations that are framed by the Co-operative societies, by virtue of the mandate contained in the Rule, etc. It is also pertinent to bear in mind that the service regulations, considered by the Apex Court in the U.P. State Co-operative Land Development Bank's case supra [ (1999) 1 SCC 741 ], were framed by the Service Board constituted in terms of Sec.122 of the U.P Co-operative Societies Act, which also empowered such service board/authority to frame regulations regarding recruitment, conditions of service, including disciplinary control of the employees, but subject to the provisions contained in Sec.70 of the said Act, (see paras 11 to 16, etc. thereof).
thereof). We are only making these prima facie observations and there is no necessity for us to render any final opinion on the issues relating to the impact of registered bye-laws in the dispute resolution process, in terms of Sec.69. However, there cannot be any doubt that, if there is any contravention of the statutory mandate in the impugned action, then certainly the Co-operative Arbitration Court can interdict with the same. In other words, where an order of dismissal or termination from service is rendered by a co-operative society, in violation and breach of the statutory mandate contained in the KCS Rules, the same would render it statutorily invalid and ultra vires and the co-operative arbitration court has the power to declare such an action to be statutorily invalid and therefore, can also consequently order that the employee be restored to the position, which stood prior to the invalid dismissal order and thus, order for reinstatement. So, in such a case, the exception in the case of employees suffering decisions of non-statutory bodies, acting in contravention of the statutory mandate, would apply to the bar of specific performance. In such a case, what is involved is not specific performance of the contract of personal service, but declaration of the statutory invalidity and the restoration of the employee to the prior position, etc. The efficacy of a non statutory bye-law, in its application to conditions of service of employees of a non statutory body, has been dealt with in B.S. Minhas vs. Indian Statistical Institute & Ors. [ (1983) 4 SCC 582 , paras 23 to 26]. 142. Further, very crucially, it has been held by the Constitution Bench in Sukhdev Singh's case supra that the subordinate legislation, if validly made, has the full force and effect of a statute (See para 17). Further that, there is no substantial difference between a rule and regulation, framed under the powers conferred by a statute (See para 33). Further that, the statutory bodies have no free hand in framing the conditions and terms of service of their employees and they are bound to apply the terms and conditions, as laid down in the regulations, and those bodies are not free to make such terms, as they deem fit and proper, and that the regulations prescribe the terms of appointment, conditions of service and procedure for dismissing employees.
Very crucially, it has been held that these regulations in the statutes are described as “status fetters on the freedom of contract”. (See para 23) 143. As held in the concurring judgments in Sirsi Municipality's case supra [ (1973) 1 SCC 409 ], Sukhdev Singh's case supra [ (1975) 1 SCC 421 ], Vaish Degree College's case supra [ (1976) 2 SCC 58 ], where the dismissal order is rendered in utter breach of the statutory mandate, especially when it casts stigma for alleged misconduct, without following the procedure, then the ordinary approach is that a relief of reinstatement could be granted {see para 47 of Sirsi Municipality's case supra [ (1973) 1 SCC 409 ], para 121 of Sukhdev Singh's case supra [ (1975) 1 SCC 421 ] & para 35 of Vaish Degree College's case supra [ (1976) 2 SCC 58 ]}. However, it has also been held in both the majority judgment and concurring judgment in Vaish Degree College's case supra [ (1976) 2 SCC 58 ] that, even if the employee is otherwise entitled for a declaration that the impugned action is statutorily invalid, etc., still the court has a discretion, in consideration of the facts and circumstances of the case, to decide whether such a relief of declaration and injunction should be granted and the courts could, in appropriate cases award compensation for proper and justifiable reasons in that regard {see paras 20, 27, 28 & 35 of Vaish Degree College's case supra [ (1976) 2 SCC 58 ]}. These aspects would also regulate the discretion of the Co-operative Arbitration Court in considering appropriate reliefs, in the facts and circumstances of the case, and to adjudge as to whether any rare and exceptional case is made out in a particular case, so as to award an alternate relief of compensation instead of reinstatement. 144. It has been observed, in para 10 of Prabhakar Sitaram's case supra [ (2017) 5 SCC 623 ], that even when the cases of the employees fall under any of the three exceptions, the civil court is not empowered to grant reinstatement and the remedy would be, in the cases of government servants covered by Article 311 and employees of statutory bodies, to initiate writ proceedings under Article 226 of the Constitution or to approach the Administrative Tribunal constituted as per the Administrative Tribunals Act, etc. 145.
145. It can be seen from the aforesaid case laws, as in I.M.Lall's case supra [AIR 1948 PC 149 (Privy Council)], Sirsi Municipality's case supra [ (1973) 1 SCC 409 (Constitution Bench)], Vaish Degree College's case supra [ (1976) 2 SCC 58 ], First U.P Warehousing Corporation's case supra [ 1969 (2) SCC 838 ], Indian Airlines Corporation's case supra [ (1971) 2 SCC 192 ], S N Goyal's case supra, [ (2008) 8 SCC 92 ], etc., that those cases emanated from civil suit proceedings and civil appeals thereafter. While laying down the general bar, it has been held that the civil court is barred by Sec.14 & Sec.41 of the Specific Relief Act to specifically enforce a contract of personal service, but that still, there are three broad exceptions, as mentioned hereinabove. In all such cases where the exceptions are found to be satisfied, then the civil court's decision to order reinstatement, etc., has been upheld by the Apex Court. As a matter of fact, in the celebrated decision of the Privy Council in I.M.Lall's case supra [AIR 1948 PC 149], it involved the dismissal from service of an officer in the Indian Civil Service, who filed a civil suit, which was decreed and which was later partially reversed by the First Appellate Court and the Privy Council ultimately upheld the declaration of nullity of the dismissal order, as it was found to be in contravention of the mandatory requirements of Sec.240(3) of the Government of India Act, 1935. The afore observations in para 10 of Prabhakar Sitaram's case supra [ (2017) 5 SCC 623 ], will have to be construed, in the light of the observations made therein, in cases where the Administrative Tribunal is established in terms of the provisions of the Administrative Tribunals Act, 1985 and Article 323A of the Constitution of India and in such cases, the jurisdiction of the civil court is barred and so also, the jurisdiction of the High Court, as the Court of first instance, as per Article 226, is also excluded.
In such a case, even if the exception is made out, the employee cannot approach the civil court, as jurisdiction of the civil court is barred and the aggrieved party will have to then move the Administrative Tribunal, as the court of first instance and then later move the Division Bench of the High Court, if necessary, as held in L.Chandra Kumar v. Union of India & Ors. [ (1997) 3 SCC 261 ]. It is only to be noted that, even if the Society registered, as per the provisions of the KCS Act & the KCS Rules, is not to be treated as “State” as per Article 12 of the Constitution of India, so long as there is contravention of the statutory mandate, judicial interdiction in appropriate remedies, could be invokable. This reference is not concerned with the issue as to whether the employer is ‘other authority’ or ‘State’ within the meaning of Article 12 of the Constitution of India. 146. The legal position regarding the interplay of issues of Article 12 State & Article 226 and independent maintainability of Article 226, in the case of co-operative societies have already been dealt with in detail by the Larger Bench of this Court in Association of Milma Officers' case supra [ 2015 (1) KLT 849 (LB)] as well as by the Full Bench of this Court in John Kuriakose's case supra [ 2015 (1) KLT 720 (F.B.)]. The dictum laid down in the earlier Full Bench of this Court in Bhaskaran's case supra [ 1987 (2) KLT 903 (FB)], has also been explained and modulated by the Larger Bench in Association of Milma Officers' case supra [ 2015 (1) KLT 849 (LB)]. Therefore, we need not get into any of those issues, except to state that, even if writ remedy is maintainable in regard to any impugned action of a co-operative society, on account of contravention of statutory mandate, the exercise of the jurisdiction is subject to the well-known rule of prudence and discretion that, where efficacious and alternate remedy is available, then the party will have to be delegated to such alternate remedies. 147.
147. Further, the jurisdiction of the State Arbitration Court, to entertain service disputes, in terms of Sec.69 of the KCS Act, is now well-settled, in view of the authoritative pronouncement of the decision of the Apex Court in that regard in the case in K A Annamma's case supra [ (2018) 2 SCC 729 ]. 148. The upshot of the above discussion is that, in the adjudication of a service dispute, under Sec.69 of the KCS Act, if it is found that the penalty, like dismissal, etc., has been imposed in contravention of the statutory mandate, contained in the KCS Act and the KCS Rules, more particularly Rule 198, etc., then the State Arbitration Court has the power to declare such impugned action to be statutorily invalid and ultra vires and can consequently restore the position of the employee to the position that existed prior to the impugned decision, etc., and consequently, order for reinstatement. However, as mentioned hereinabove, the Co-operative Arbitration Court should exercise its discretion in a judicial and judicious manner and, if it is found that there are rare and exceptional circumstances, which warrant not to grant the relief of reinstatement, then such discretion should also be exercised, so as to consider the grant of compensation, in lieu of reinstatement. The ordinary perspective in such cases, especially involving dismissal, casts a stigma for misconduct and it is in violation of the statutory mandate, reinstatement would be the appropriate relief. However, in exceptional cases, such discretion to grant reinstatement may not be exercised, but only for compelling and good reasons, as held in cases as in Vaish Degree College's case supra [ (1976) 2 SCC 58 ], etc. 149. But, where the intervention is made solely on account of violation of the principles of natural justice and the prescribed procedure in that regard, then the court, after setting aside the impugned order, could give liberty to the employer-co-operative society to take fresh disciplinary action or to continue the disciplinary action at the stage where it has stopped. Correctness of Cheranallur Service Co-operative Bank’s case supra [ 2012 (3) KHC 834 = 2012 (4) KLT SN 2 (C No.2)] 150. The Division Bench of this Court in Ambika’s case supra [ 2018 (3) KLT 779 (DB)], in para 4 thereof, has referred to a judgment of the learned Single Judge of this Court in Cheranallur Service Co-operative Bank Vs.
The Division Bench of this Court in Ambika’s case supra [ 2018 (3) KLT 779 (DB)], in para 4 thereof, has referred to a judgment of the learned Single Judge of this Court in Cheranallur Service Co-operative Bank Vs. State of Kerala & Ors., [ 2012 (3) KHC 834 = 2012 (4) KLT SN 2 (C No.2)] and has held in para 7 thereof that the decision in Cheranallur Service Co-operative Bank’s case (supra), to the extent that it holds that the Co-operative Arbitration Court can direct reinstatement in service of the delinquent, will stand overruled. 151. It has been inter alia held in para No.16 of the decision by the learned Single Judge in Cheranallur’s case supra [ 2012 (3) KHC 834 ] that if the Labour Court or Industrial Tribunal, constituted under the Industrial Disputes Act, can order reinstatement of service of w0rkman, who is governed by the ID Act, then there is nothing wrong in the Co-operative Arbitration Court directing reinstatement to service, etc. It may be pertinent to refer to the relevant portion of para 16 of Cheranallur’s case supra [ 2012 (3) KHC 834 ], which reads as follows: “16. .... ... If the Labour Court or the Industrial Tribunal constituted under the Industrial Disputes Act can order reinstatement in service of a workman who is governed by the Industrial Disputes Act, I find nothing wrong in the Co - operative Arbitration Court directing reinstatement in service. That apart, under S.100 of the Act, the jurisdiction of a civil or Revenue Court is barred only in respect of any matter for which any provision is made in the Act. S.69 of the Act makes a provision for adjudication of disputes in connection with employment of officers and servants of the different classes of co - operative societies, which as held by this Court would take in disputes arising under disciplinary proceedings also. Therefore, merely because S.100 bars the jurisdiction of a Civil Court in respect of matters for which provision has been made in the Act, it cannot be said that the Co - operative Arbitration Court could not have entertained the dispute. In the absence of a challenge by the petitioner to the constitutional validity of sub-section (2) of S.69 of the Act, the contention that the Co - operative Arbitration Court cannot order reinstatement, is liable to be rejected.” (Emphasis supplied) 152.
In the absence of a challenge by the petitioner to the constitutional validity of sub-section (2) of S.69 of the Act, the contention that the Co - operative Arbitration Court cannot order reinstatement, is liable to be rejected.” (Emphasis supplied) 152. The commonality and separateness of the exercise of jurisdiction by civil courts, Labour Courts and Industrial Tribunals as per the ID Act has been dealt with by the Apex Court in the landmark decision in The Premier Automobiles Ltd vs Kamlekar Shantaram Wadke of Bombay & Ors. [ (1976) 1 SCC 496 , para 23] 153. The pre-Sec.11A of the ID Act legal position, as it stood prior to 15.12.1971 has been dealt with in para 32 of the celebrated decision of the Apex Court in Workmen v. Firestone Tyre & Rubber Co. of India (P) Ltd., [ (1973) 1 SCC 813 ] (See pages 827, 828 and 829 of the SCC report). So also, the legal position after the introduction of Sec.11A of the ID Act made effective from 15.12.1971, has been dealt with in the subsequent paras of Firestone’s case supra (paras 33 onwards). 154. The jurisprudential foundation of the special powers available with the Industrial Tribunal/Labour Court, as per the ID Act, to order for reinstatement/discharge of dismissed employees, despite contract of personal service has been delineated in the celebrated decision of the Federal Court of India in Western India Automobile Association v. Industrial Tribunal, Bombay & Ors [1949 FCR (Federal Court Reports) 321 = AIR 1949 FC 111], which in turn arose out of the judgment dated 9.9.1948 of the Division Bench of Bombay High Court in Appeal Nos.31 & 39 of 1948 [Reported in AIR 1949 Bom. 141 = ILR 1949 Bom. 591] 155. The special and distinctive features of the adjudicatory functions or powers of the fora, established in terms of the industrial law jurisprudence, have been dealt with in the decision of the Privy Council in the case as in Labour Relations Board of Saskatchewan v. John East Iron Works Ltd. [ AIR 1949 PC 129 ] paras 26, 27 etc. 156. The Industrial Disputes jurisprudence and particularly rights, which are exclusively based on the Industrial Disputes Act, stem not from the special requirements of obligations of contract of employment, but from the readjustments calibrated by the rougher jurisprudence of social justice and industrial laws.
156. The Industrial Disputes jurisprudence and particularly rights, which are exclusively based on the Industrial Disputes Act, stem not from the special requirements of obligations of contract of employment, but from the readjustments calibrated by the rougher jurisprudence of social justice and industrial laws. So, the special powers, which are exercisable only by the Labour Court or the Industrial Tribunal, cannot be assumed by Civil Courts and other Courts and adjudicatory forums like the Co-operative Arbitration Court. The Co-operative Arbitration Court will have the discretion to grant relief of reinstatement of a dismissed/discharged employee of a co-operative society, not because it can assume the powers of a Labour Court/Industrial Tribunal, as per the ID Act, but only in cases where the impugned action of dismissal/discharge etc. has been rendered in contravention of the statutory mandate. So, the reasoning of the learned Single Judge in para 16 of Cheranallur’s case supra, as if the Co-operative Arbitration Court will derive its power of reinstatement of a dismissed employee by assuming the powers of a Labour Court/Industrial Tribunal, as per the ID Act, is not a tenable and legally correct approach. However, the conclusion made by the learned Single Judge in Cheranallur’s case supra that, in appropriate cases, the Co-operative Arbitration Court will have discretion to order for reinstatement where the impugned action is in contravention of the statutory mandate, is correct and tenable. 157. The main reasoning given by the Full Bench of the Madhya Pradesh High Court in Sevaram's case supra [1983 LAB. I. C. 1565], as can be seen from para No.4 thereof, is that the adjudicatory forum, under Sec. 55(2) of the Madhya Pradesh Co-operative Societies Act, could set aside the dismissal order and restore back the status of the employee, before his termination of service, if it is found that the impugned action of dismissal is in contravention of statutory rules.
However, an additional reasoning is given in the latter portion of para No.4 thereof, whereby the Full Bench of the Madhya Pradesh High Court has held that the said conclusion could also be arrived at on the basis that similarly placed employee covered by the Industrial Disputes Acts, could be entitled for reinstatement in case the dismissal or removal is found to be illegal and therefore, an employee of the co-operative society, similarly placed, should not be denied the similar relief of reinstatement, while the adjudicatory forum under the M.P.Co-operative Societies Act adjudicates the dispute. In view of the above aspects, we are not in a position to agree with the additional reasoning of the Full Bench of the Madhya Pradesh High Court, as if the adjudicatory forum under the Co-operative Societies Act could assume the powers of the Labour Court or the Industrial Tribunal, as per the ID Act. So also, a further additional reasoning is also given in para No.6 of the decision in Sevaram's case supra [1983 LAB. I. C. 1565], whereby, it has been held that the adjudicatory forum as per Sec. 55(2) of the M.P. Co-operative Societies Act would also assume the powers of the statutory appellate authority, hearing appeals against the original action of dismissal, etc. We are not in a position to agree to that reasoning for the simple reason that the basis for interdiction of a adjudicatory forum, like the Co-operative Arbitration Court is mainly on account of the aspect of breach of the statutory mandate and not on the basis that the said adjudicatory forum would assume the powers of an appellate authority, dealing with an appeal against the original action. 158. However, in view of the above said aspects, we are in concurrence with the conclusion arrived at by the Full Bench of the Madhya Pradesh High Court in Sevaram's case supra [1983 LAB. I. C. 1565] that the adjudicatory forum therein as per the Co-operative Societies Act, could set aside the impugned order of dismissal or removal and restore back the status of the employee, where it is found that the impugned action in contravention of the statutory mandate. Some aspects arising out of K.K.Saksena's case supra [ (2015) 4 SCC 670 ] 159.
Some aspects arising out of K.K.Saksena's case supra [ (2015) 4 SCC 670 ] 159. A discussion on these matters may not be complete without reference to the decision of the Apex Court in K.K.Saksena's case supra [ (2015) 4 SCC 670 ]. The Apex Court has held in para 52 of the decision in K.K.Saksena's case supra [ (2015) 4 SCC 670 ] as follows: “52. It is trite that contract of personal service cannot be enforced. There are three exceptions to this rule, namely: (i) when the employee is a public servant working under the Union of India or State; (ii) when such an employee is employed by an authority/body which is a State within the meaning of Article 12 of the Constitution of India; and (iii) when such an employee is “workmen” within the meaning of Section 2(s) of the Industrial Disputes Act, 1947 and raises a dispute regarding his termination by invoking the machinery under the said Act. In the first two cases, the employment ceases to have private law character and “status” to such an employment is attached. In the third category of cases, it is the Industrial Disputes Act which confers jurisdiction on the Labour Court/Industrial Tribunal to grant reinstatement in case termination is found to be illegal.” 160. It appears that the exception attracted in the case of Article 12 "State” body has not been envisaged in any of the Apex Court judgments rendered prior to K.K.Saksena's case supra [ (2015) 4 SCC 670 ] and subsequently, as in decisions in Prabhakar Sitaram's case supra [ (2017) 5 SCC 623 ]. All those decisions, other than K.K.Saksena's case supra [ (2015) 4 SCC 670 ], have envisaged the exception in that regard, as applicable to the statutory body violating statutory mandate and the extended exceptions thereto. 161. In this case, we are more concerned with the cases of nonstatutory bodies attracting the extended exception to the general bar of specific performance. A non-statutory body may or may not satisfy the test of Art. 12 “State”.
161. In this case, we are more concerned with the cases of nonstatutory bodies attracting the extended exception to the general bar of specific performance. A non-statutory body may or may not satisfy the test of Art. 12 “State”. If a non-statutory body, which is not regulated and controlled by statutes (like a society registered under the Societies Registration Act, etc), but by the nature of its composition would satisfy the parameters of Art.12 “State”, then it could attract the extended exception to the general bar as envisaged in clause (2) of para 52 of K.K.Saksena's case supra [ (2015) 4 SCC 670 ]. But, if a non-statutory body like a co-operative society registered as per the KCS Act and the KCS Rules, which may not satisfy the test of “State” as per Art.12 of the Constitution of India, but is regulated and controlled by statutes, then the impugned action of such a non-statutory body in contravention of the statutory mandate would attract the extended exception to the general bar of specific performance as held in the various decisions cited herein before. So, in such a case, the mere aspect that such a nonstatutory body may not satisfy the definition of Art.12 test, will not be material in attracting the extended exception to the general bar, so long as such a non-statutory body is regulated by statutes and where its impugned action is in breach of the statutory provisions. SUMMING UP: 162. The upshot of the above discussion may be summed up as follows: (1) The Apex Court has categorically held in K.A.Annamma's case supra [ (2018) 2 SCC 729 ] that the Co-operative Arbitration Court has jurisdiction to entertain service disputes of employees of co-operative societies, in terms of Sec. 69 of the KCS Act. (2)(a) The Co-operative Societies involved in these cases, registered under the Kerala Co-operative Societies Act (“KCS Act”) and the Kerala Co-operative Societies Rules (“KCS Rules”), cannot be said to be statutory bodies and so also, it may not satisfy the definition of Article 12 of the Constitution of India.
(2)(a) The Co-operative Societies involved in these cases, registered under the Kerala Co-operative Societies Act (“KCS Act”) and the Kerala Co-operative Societies Rules (“KCS Rules”), cannot be said to be statutory bodies and so also, it may not satisfy the definition of Article 12 of the Constitution of India. However, if the impugned action of dismissal/termination of service of an employee is rendered by a Co-operative Society, which is a non-statutory body, in contravention and derogation of the statutory mandate contained in the Act and the Rules, more particularly, Rule 198 of the KCS Rules, then the case of exception of a non-statutory body, acting in breach of statutory mandate, would be attracted and so the bar of specific performance of contract of personal service will not arise and in such cases, what is involved is a declaration of the statutory invalidity and ultra vires nature of the impugned action and consequently, restoring the employee to the prior position and thus, consequently the State Co-operative Arbitration Court will have the discretionary power to order for reinstatement of an employee of a Co-operative Society, if such an exception is made out in such scenarios. (b) It is also held that the Co-operative Arbitration Court is under the statutory obligation to render its award in a Sec. 69 dispute, strictly in accordance with the provisions of the Act and Rules, in view of the mandate contained in Sec. 70 (1) of the Act. Hence, if the dismissal order is rendered by a Co-operative Society, in contravention of the statutes governing the field then the Co-operative Arbitration Court will derive its power to order reinstatement, as the said forum is under the statutory obligation to enforce the provisions of the Act and Rules. (c) The approach made in the decision of this court in Cheranallur's case supra [ 2012 (3) KHC 834 ], as if the Co-operative arbitration court will derive its power to reinstatement of a dismissed employee, as the said forum can assume the powers of the Labour Court/Industrial Tribunal as per the ID Act, is not tenable and legally correct.
(c) The approach made in the decision of this court in Cheranallur's case supra [ 2012 (3) KHC 834 ], as if the Co-operative arbitration court will derive its power to reinstatement of a dismissed employee, as the said forum can assume the powers of the Labour Court/Industrial Tribunal as per the ID Act, is not tenable and legally correct. However the conclusion made in the decision of this court in Cheranallur's case supra [ 2012 (3) KHC 834 ] that the Co-operative Arbitration Court has the power to order reinstatement of a dismissed employee is correct but on the reason that such impugned action is rendered in breach of the statutory mandate. (3) (a) Ordinarily, where dismissal order involves casting of stigma on the basis of alleged misconduct and if such an order is in contravention of statutory mandate, then the relief of reinstatement in service could be granted [see the above case law discussion on Sirsi Municipality's case supra [ (1973) 1 SCC 409 ], Sukhdev Singh's case supra [ (1975) 1 SCC 421 , etc]. (b) However, if the facts and circumstances of the case disclose that it is not a fit case to exercise discretion to grant an order of reinstatement, then the Co-operative Arbitration Court could, for special and good reasons, to be recorded in writing, consider an alternative relief of granting compensation [see Vaish Degree College's case supra, (1976) 2 SCC 58 , John Kuriakose's case supra ( 2015 (1) KLT 720 ) (F.B.) etc.]. (c) In cases where the interference is mainly on the ground of contravention of the due procedure for conduct of enquiry, etc., then it is well settled that the Court, while setting aside the impugned dismissal or removal order may direct reinstatement of the employee, but liberty will have to be given to the employer to start the disciplinary proceedings from the appropriate stage etc. (4) The dictum laid down by the Apex Court in Prabhakar Sitaram's case supra [ (2017) 5 SCC 623 ] that the adjudicatory forum set up, as per Sec. 9(1) of the Maharashtra Co-operative Societies Act, does not have jurisdiction to entertain service disputes and also, consequently, does not have competence to order for reinstatement of a dismissed employee, does not have any application in the cases covered by Sec. 69 of the Kerala Co-operative Societies Act.
(5) Even if a non-statutory body, like a co-operative society registered under the KCS Act & KCS Rules, does not satisfy the definition of “state”, as per Art. 12, it will attract the extended exception to the general bar of specific performance, if it is controlled and regulated by statutory provisions and if its impugned action has been rendered in violation of such statutory provisions. (6) The legal position laid down by the Division Bench of the is Court in Ambika's case supra [ 2018 (3) KLT 779 (DB)] to the extent that the Co-operative Arbitration Court does not have any power to order reinstatement of an employee of a Co-operative Society does not reflect the correct legal position and the same will stand overruled. CONCLUSION In the light of above said aspects, it is held that the legal position held by the Division Bench of this Court in Ambika's case supra [ 2018 (3) KLT 779 (DB)], to the extent that the Co-operative Arbitration Court does not have the power to order for reinstatement of an employee of the co-operative society, even if the impugned action of dismissal has been rendered in breach of statutory mandate, does not reflect the correct legal position and the same will stand overruled. Before parting with these cases, we are obliged to place on record our high appreciation for the valuable service rendered by all the Advocates concerned, who have appeared in these cases, more particularly to Sri. M.M. Monaye, learned Advocate, Sri. N. Manoj Kumar, learned State Attorney, Sri. Saigi Jacob Palatty, learned Senior Government Pleader, Sri. Ashok B. Shenoy, learned Amicus Curiae appointed by this Court in their assistance to us for resolving the issues involved herein. The Registry will send back the cases involved in this Reference Order to the Division Bench for disposal, in the light of the legal principles laid down above.