IMPORTANT POINT
Retired employees are entitled to gratuity and provident fund unless disciplinary proceedings are initiated against them, and provisions of the Payment of Gratuity Act prevail over state laws.

JUDGMENT :

The petitioner retired from the service of the 2nd respondent Bank on 31.5.2018 as Secretary. On getting information that the Branch Manager and employees of Thazhakkara branch of the Society were indulging in certain misleads, a surprise inspection was ordered at the instance of the petitioner. The preliminary enquiry revealed serious lapses and illegal acts committed by the Branch Manager. The Managing committee, which met on 22.12.2016, decided to suspend the Branch Manager, and he was suspended on 22.12.2016. The Cashier and Clerk were also placed under suspension. Based on the inspection conducted, with the help of the Computer expert, it was found that there was malpractice to the tune of Rs.14,82,88,905/- and a crime was registered as Crime No.134 of 2017 by Mavelikkara Police station for the offences punishable under Sections 406, 408, 409, 417, 420, 465, 468, 120B, 34 and 471 (wrongly shown as 571) of the Indian Penal Code and Section 65 of the Information Technology (Amendment) Act, 2008. The three employees, who were responsible for the entire misappropriation, executed an agreement dated 27.10.2017 agreeing that if the loss is found to be of their deeds, the same can be recovered from their properties.

2. On 13.6.2017, the petitioner was suspended on the grounds of supervisory lapses, and she retired on 30.5.2018 without being reinstated in service. No disciplinary proceedings were initiated against the petitioner. The department conducted an inquiry under Section 65 of the Kerala Co-operative Societies Act, 1969 (for short ‘the KCS Act’). Based on the enquiry report, proceedings under Section 68 of the KCS Act were also initiated. Since she retired from the service, she is entitled to gratuity, Provident Fund, welfare fund, terminal leave surrender and other reliefs, which were denied to the petitioner. Therefore, she approached this court by filing W.P.(C.) No.19820 of 2018 for a direction to disburse the retiral benefits. The said Writ Petition was heard along with a batch of cases, and by judgment dated 2.7.2019, it was observed that since proceedings under Section 68 of the KCS Act, in respect of imposition of surcharge under the Act, are pending, the reliefs sought in the Writ Petition cannot be granted at the stage. The petitioner was given the liberty to seek reliefs after conclusion of the proceedings.

3. An arbitration case was filed against the Branch Manager and other employees as ARC No.1 of 2017, and this Court directed disposal of the said case within 6 months. On 28.2.2020, the 3rd respondent issued Ext.P3 Surcharge proceedings under Section 68(2) of the KCS Act. There is no allegation in Ext.P3 against the petitioner for misappropriation of any amounts. Surcharge proceedings are initiated only on the grounds of supervisory lapses on the side of the petitioner as Secretary. The petitioner has filed a statutory appeal under Section 83 of the KCS Act before the Government against Ext.P3, which is still pending. In the said circumstances, the petitioner has approached this Court with the following reliefs:

i) to issue a writ of mandamus or any other appropriate writ, order or direction, directing the respondents to disburse gratuity, provident fund, terminal leave surrender and family welfare fund along with interest, within a time limit prescribed by this Hon’ble Court; and

ii) to grant such other reliefs as this Honourable Court may deem fit in the circumstances of this case.

4. Respondent Nos.1 and 2 filed a counter affidavit contending that the Writ petition is not maintainable as respondent Nos.1 and 2 do not come within the definition of State under Article 12 of the Constitution of India. The petitioner also has an alternate remedy under Section 69 of the KCS Act. Res-judicata is another ground raised in the counter affidavit, as the petitioner has already approached this court by filing W.P.(C) No.19820 of 2018 seeking the same relief, and this court has declined the prayers therein.

5. Th