Full Judgment Text
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 563 OF 2011
[Arising out of SLP(C) No.20193 of 2008]
HASSAN DISTRICT CENTRAL CO-
OOPERATIVE BANK LTD.
.......APPELLANT
Versus
JOINT REGISTRAR OF CO-OOPERATIVE
SOCIETIES & ANR.
.....RESPONDENTS
O R D E R
Leave granted.
2. The second respondent was an employee of the
appellant Bank. Rule 153 of the Staff Service Rules of
the employees of the Hassan District Co-operative Central
Bank Ltd., provides for compulsory retirement and relevant
portion thereof is extracted below:
“153. COMPULSORY RETIREMENT
The Board has the right to compusorily
retire an employee after completion of ten
years of service or on attainment of the age of
45 years whichever is earlier, if the Board
decides that his/her services are not
satisfactory as could be found from the service
records and personal files. The grounds on
which such compulsory retirement of an employee
may be effected are indicated in rules
governing compulsory retirement.
RULES GOVERNING COMPULSORY RETIREMENT:
xxx xxx xxx xxx”
....2.
- 2 -
Exercising the power under the said Rules, the Board of
Directors passed a resolution dated 13.8.2002 to
compulsorily retire the second respondent from the service
of the appellant in terms of Rule 153. In pursuance of it,
an office order dated 30.9.2002 was issued compulsorily
retiring the second respondent from services with effect
from 1.10.2002 by paying three months salary in lieu of
notice.
3. The second respondent raised a dispute under
Section 70(2) of the Karnataka Co-operative Societies Act,
1959 ('Act' for short). The Joint Registrar, by Award dated
5.11.2005, allowed the dispute holding that the appellant-
bank had not followed the procedure contemplated under Rule
153 in passing the order of compulsory retirement.
Consequently, he set aside the order of compulsory
retirement reserving liberty to the appellant to impose any
other appropriate punishment in accordance with the service
rules.
4. As the said order was not implemented for
more than a year, the second respondent filed W.P.
No.8823/2007 seeking a direction to the appellant to
reinstate him in service as ordered by the Joint Registrar
and for a further direction to pay him the salary dues from
30.9.2002
.....3.
- 3 -
with all consequential benefits. A learned single Judge of
the High Court, by order dated 20.9.2007, disposed of the
said writ petition with a direction to the appellant to
comply with the order passed by the Joint Registrar. He
also directed the appellant to dispose of the
representation submitted by the second respondent herein
seeking certain reliefs. Learned single Judge passed the
said order as the Bank had not challenged the order of the
Joint Registrar.
5. The Bank filed a writ appeal challenging the
order of the learned single Judge on 19.11.2007. On the
same day, the Bank also filed an appeal before the
Karnataka Appellate Tribunal challenging the Award of the
Joint Registrar dated 5.11.2005 (which is stated to be
still pending). A Division Bench of the High Court
dismissed the writ appeal by the impugned order dated
19.2.2008. While doing so, the High Court has held that
Rule 153 of the appellant's Staff Services Rules was
contrary to Rule 18 of the Karnataka Co-operative Societies
Rules, and, therefore, “unenforceable”. The said order is
challenged in this appeal by special leave.
6. The first contention raised by the appellant
was
......4.
- 4 -
that in an appeal filed by the appellant Bank against the
order of learned single Judge disposing of employee's writ
petition for implementation of the Award of Joint
Registrar, the Division Bench could not have held that Rule
153 of the Staff Services Rules was ineffective or
unenforceable, as such a prayer was not made by any one.
Learned counsel for the contesting respondent (second
respondent) very fairly conceded that the Division Bench
could not have pronounced upon the validity of Rule 153 of
the Staff Services Rules when that was not under challenge
and that too in an appeal by the Bank challenging the order
directing implementation of the Award of the Joint
Registrar. Therefore, the order of the Division Bench, to
the extent it invalidates Rule 153, is liable to be set
aside.
7. Insofar as the order of the Division Bench
affirming the direction of the learned single Judge for
implementation of the Award of the Joint Registrar, all
that is to be observed is that if the appellant succeeds in
the appeal filed before the Karnataka Appellate Tribunal
against the award dated 5.11.2005 of the Joint Registrar,
it need not implement the said Award dated 5.11.2005. This
is so because the learned single Judge directed
.......5.
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implementation of the said order only on the ground that it
had not been challenged. If the appellant loses the said
appeal pending before the Karnataka Appellate Tribunal,
obviously it has to implement the Award dated 5.11.2005.
8. Therefore, we dispose of this appeal as
follows:
(i) The order of the High Court declaring/observing that
Rule 153 of the Appellant's Staff Service Rules is invalid
and unenforceable is set aside.
(ii) The direction of the learned single Judge affirmed
by the Division Bench that the award dated 5.11.2005 has to
be implemented is subject to the outcome of the pending
appeal of the appellant against the said award, before
the Karnataka Appellate Tribunal.
(iii) We request the Karnataka Appellate Tribunal to
dispose of the pending appeal expeditiously.
(iv) If the award of the Joint Registrar is not stayed by
the Karnataka Appellate Tribunal, the appellant is bound to
implement the order, unless it is set aside.
......................J.
( R.V.
RAVEENDRAN )
New Delhi; ......................J.
January 14, 2011. ( A.K. PATNAIK )