IN THE HIGH COURT OF KERALA AT ERNAKULAM
WP(C).No. 19 of 2011(B)
1. MEENACHIL EAST URBAN CO-OPERATIVE BANK
... Petitioner
2. CHAIRMAN, MEENACHIL EAST URBAN
Vs
1. P.J.JOSE, PURAYIDATHIL HOUSE,
... Respondent
2. CO-OPERATIVE ARITRATION COURT,
3. JOINT REGISTRAR OF CO-OPERATIVE
For Petitioner :SRI.O.V.RADHAKRISHNAN (SR.)
For Respondent :SRI.P.DEEPAK
The Hon'ble MR. Justice P.N.RAVINDRAN
Dated :12/01/2011
O R D E R
P.N.RAVINDRAN, J.
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W.P.(C) No. 19 OF 2011
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Dated this the 12th day of January, 2011
J U D G M E N T
Ext.P9 interim order passed by the Co-operative Arbitration
Court, Thiruvananthapuram on an application filed by the first
respondent is under challenge in this writ petition. The brief facts of
the case are as follows:-
2. The first respondent was the Branch Manager/Chief
Accountant of the Erattupetta branch of the first petitioner bank.
Pursuant to an inspection conducted by the Joint Manager of the
bank on 22.3.2008 which resulted in Ext.R1(c) report, the first
respondent and Sri. S.Dilip Kumar, Cashier of the said branch were
placed under suspension pending enquiry. Ext.P1 proceedings
dated 22.3.2008 is the order passed by the Chairman of the bank
placing the first respondent under suspension. Disciplinary action
was initiated against the first respondent as well as the Cashier.
Ext.P2 is the memo of charges dated 19.5.2008 issued to the first
respondent. An enquiry into the charges levelled against the first
respondent in Ext.P2 memo was held by an enquiry officer. In
Ext.P3 enquiry report dated 24.2.2009, the enquiry officer found the
first respondent guilty of all the charges levelled against him. The
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sub-committee of the bank thereupon issued notice to the first
respondent, considered his objections and decided to dismiss him
from service with effect from 16.3.2009. Ext.P4 communication was
thereupon issued on 18.3.2009 by the convenor of the sub-
committee.
3. The first respondent challenged the order dismissing him
from service in appeal before the Board of Directors of the bank. The
Board that met on 15.6.2009 considered the appeal and resolved to
reject it by Ext.P5 resolution. The decision was communicated to the
first respondent by Ext.P6 letter dated 24.6.2009. The first
respondent thereupon filed ARC No.99 of 2009 in the Co-operative
Arbitration Court, Thiruvananthapuram on 10.7.2009. Though in that
appeal he had filed an application for interim relief, the application
was not numbered for sometime. Later, it was numbered as I.A.
No.159 of 2010. The first respondent later filed W.P.(C) No.33445 of
2010 in this Court wherein he prayed for a direction to the Co-
operative Arbitration Court to pass expeditious orders on the
interlocutory application and in the arbitration case. By Ext.P8
judgment delivered on 15.11.2010, more than one year after the
arbitration case was filed, a learned single Judge of this Court
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directed the Co-operative Arbitration Court to pass orders on the
interlocutory application within 10 days from the date of receipt of a
copy of the judgment and in the arbitration case within a period of
three months thereafter. The Co-operative Arbitration Court
thereupon considered the interlocutory application with notice to the
first respondent herein and passed Ext.P9 order staying the
operation of Ext.P4 order dismissing the first respondent from service
till the disposal of the arbitration case. Ext.P9 is under challenge in
this writ petition.
4. The petitioners contend that though the Co-operative
Arbitration Court has the power to pass interim orders, it erred in
passing an order staying the order of dismissal passed on 18.3.2009,
which had taken effect that day and was affirmed in appeal by the
Board of Directors on 15.6.2009. Relying on the decision of the Apex
Court in State of Rajasthan & Ors. v. Om Prakash Dadhich & Anr.
(2009 (16) SCC 242) it is contended that the Arbitration Court should
not have passed an interim order which has the effect of reinstating
the first respondent in service at the preliminary stage and that the
Arbitration Court could have granted reinstatement in service only in
the main case and not by way of interim relief. The petitioners also
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contended that Ext.P4 order of dismissal has merged with Ext.P5
appeal order of the Board and as the appellate order has not been
challenged in the arbitration case, the Arbitration Court erred in
passing an order staying the operation of Ext.P4, which has no
independent existence after Ext.P5 appellate order.
5. I heard Sri. O.V.Radhakrishnan, learned Senior Advocate
appearing for the petitioners, Sri.Sri.P.Ravindran, learned Senior
Advocate appearing for the first respondent and Sri.P.M.Manoj,
learned Government Pleader appearing for respondents 2 and 3. the
learned Senior Advocate appearing for the first respondent
contended with reference to the findings in Ext.R1(c) report
submitted by the General Manager of the bank, who was examined
as MW1 in the enquiry, that the findings and observations in
paragraph 35 and 36 of Ext.P3 enquiry report are perverse. The
learned Senior Advocate contended that as the Cashier (Sri.S.Dilip
Kumar) had admitted that he had misappropriated the money, the
finding of the enquiry officer that the statements made by MW1 and
MW3 that the first respondent would not have purposefully
misappropriated the funds cannot be relied on unless the Cashier
admits the liability, is a perverse finding. The learned Senior
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Advocate also contended that the very enquiry held against the first
respondent is bad for the reason that even before the written
statement of defence was submitted to Ext.P2 memo of charges and
it was considered by the disciplinary authority, the disciplinary
authority had delegated its power to the enquiry authority. The
learned counsel also contend that further proceedings pursuant to
the submission of the enquiry report were held without affording the
first respondent an opportunity to object to the findings in the enquiry
and therefore, the Co-operative Arbitration Court was perfectly right
in passing an interim order staying the operation of the order
dismissing the first respondent from service.
6. I have considered the submissions made at the Bar by the
learned counsel on either side. It is not in dispute that Ext.P4 order
dismissing the first respondent from service took effect on 18.3.2009
when a copy thereof was served on him. Ext.P4 order was upheld by
the Managing Committee of the first petitioner bank by Ext.P5 order
dated 15.6.2009. Though the first respondent moved the Co-
operative Arbitration Court by filing ARC No.99 of 2009 on 10.7.2009,
he did not move for interim reliefs immediately thereafter. He did not
also move this Court seeking expeditious disposal of the arbitration
WPC No.19/2011 6
case or the application for interim relief filed by him in the arbitration
case. He moved this Court seeking such a direction only in
November, 2010, more than one year and three months after the
arbitration case was filed. It was thereafter that the Arbitration Court
passed Ext.P9 order on 4.12.2010 staying the operation of Ext.P4
order dismissing the first respondent from service. In my opinion, in
view of the fact that more than one year and three months had
passed after the dismissal of the first respondent, by the time the
application for interim relief was considered, the Arbitration Court
ought to have declined to stay the operation of Ext.P4 order. Ex.P9
order passed by the Arbitration Court staying the operation of Ext.P4
order, more than one year and three months after it was passed and
it had taken effect, cannot in my opinion be sustained. The
Arbitration Court could not have by an interim order granted a relief
which could have been granted only in the main case. By Ext.P8
judgment this Court had also directed that the arbitration case itself
should be disposed of within three months from the date on which
orders are passed on the application for interim relief. The said
period of three months will expire on 4.3.2011. Therefore, the
Arbitration Court will have to necessarily hear and dispose of the
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arbitration case by that date.
In such circumstances, I allow the writ petition, set aside Ext.P9
and direct the Co-operative Arbitration Court to dispose of the
arbitration case, untrammelled by the observations in this judgment
and in Ext.P9 order, within the time limit fixed by this Court in Ext.P8
judgment.
P.N.RAVINDRAN,
(JUDGE)
vps
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