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2025 Supreme(Online)(KER) 15085

HIGH COURT OF KERALA
VIJU ABRAHAM, J
H.PREMKUMAR – Appellant
Versus
STATE OF KERALA – Respondent
WP(C) 17537/2022



Advocates:
S.P.ARAVINDAKSHAN PILLAY, N.SANTHA, V.VARGHESE, PETER JOSE CHRISTO, S.A.ANAND, K.N.REMYA, L.ANNAPOORNA, VISHNU V.K., ABHIRAMI K. UDAY

Corporate management is liable for actions of its Manager; individual Managers cannot be held personally liable for prior decisions.

Headnote:(A) Kerala Education Act - Section 2 - Kerala Education Rules - Chapter III, Rule 7 - Writ petition challenging recovery notices issued against the petitioner as Manager of educational agency for alleged illegal appointments made prior to his tenure - Court held that liability cannot be imposed on the petitioner personally for actions taken by previous management, emphasizing that the corporate entity is responsible for the actions of its Manager. (Paras 2, 3)

(B) Corporate Management - The change in management does not absolve the corporate entity from liability for actions taken by its previous Manager, as the management is bound by the actions of the Manager. (Paras 3)

Facts of the case:
The petitioner, as Corporate Manager of TD Schools, challenged recovery notices for excess salary paid to teachers appointed illegally by a previous Manager. The court found that the petitioner could not be held liable for actions taken before his tenure.

Findings of Court:
The court set aside the recovery order against the petitioner and directed the Government to reconsider the matter with notice to the corporate educational agency.

Issues: Whether the petitioner can be held personally liable for actions taken by a previous Manager and the implications of corporate management liability.

Ratio Decidendi: The court ruled that the corporate educational agency is responsible for the actions of its Manager, and the petitioner cannot be personally liable for decisions made prior to his appointment.

Result: Ext.P8 set aside and matter remitted for reconsideration.

JUDGMENT

Petitioner has approached this Court challenging Ext.P8 order.

2. Brief facts necessary for disposal of the writ petition are as follows: It is averred that at the time of filing of the writ petition petitioner is the Corporate Manager of the TD.Schools, Thuravoor/Alappuzha which is an educational agency as defined in the Kerala Education Act and Rules, which runs various educational institutions. Petitioner took charge as Corporate Manager of TD Schools on 21.12.2017. It is the contention of the petitioner that before he took charge as Corporate Manager of TD Schools the previous Manager has made appointment of Smt.Priya G. and Smt.Vidya Nandini P.J. as HSA(Hindi) on 03.06.2013 and 01.06.2015 respectively and the said appointments were duly approved and they were drawing salary and allowances. Later these two appointments were found to be illegal by the 3rd respondent on the ground that a senior HST(Hindi) was working on protection and that it was suppressing the above fact that the Manager made appointments of Smt.Priya G. and Smt.Vidya Nandini P.J. and got it approved. Thereupon Ext.P1 order was issued by the 3rd respondent. Pursuant to Ext.P1 the petitioner who was the then Manager by Ext.P2 terminated the services of Smt.Priya G. and Smt.Vidya Nandini P.J. While so the petitioner was served with Exts.P5 and P6 revenue recovery demand notices. It is the contention of the petitioner that a perusal of Exts.P5 and P6 would reveal that the amounts sought to be recovered from the petitioner are in respect of the alleged excess salary drawn by the aforementioned teachers (Smt.Priya G. and Smt.Vidya Nandini P.J.). Aggrieved by the same the petitioner has approached this Court filing W.P.(C) No.29000 of 2020 which was allowed as per Ext.P7 judgment by setting aside Exs.P8 and P9 (Exts.P5 and P6 herein). Petitioner contends that there is a specific finding in Ext.P7 that the petitioner cannot be imputed or mulcted with the liability as has now been attempted through the notices and that the matter has to be considered by the Government afresh and the recovery proceedings against the petitioner was stayed till a decision is taken by the Government. Later Ext.P8 order is issued by the Government whereby the liability is still fastened on the petitioner but limiting the same to Rs.14,85,432/-. Petitioner would contend that the schools are run by a corporate educational agency and petitioner in his capacity as an office bearer of the Gowda Saraswatha Brahmins Temple Committee officiated as the Manager of the corporate agency. It is further submitted that the petitioner took charge as Corporate Manager only on 21.12.2017 whereas the alleged illegal appointments were made during 2013 and 2015 during which period the petitioner was not the Manager. It is further submitted that the petitioner is not the present Manager of the Schools also. An educational agency as defined in Section 2 of the Kerala Education Act means any person or body of persons permitted to establish and maintain any private school under this Act. In Chapter I Rule 2(8) the management shall have the meaning as ‘Manager’. Chapter III Rule 7 deals with action against Manager or Educational Agency in the event of mismanagement. Rule 7(4) mandates that in the case of a Manager who commits serious irregularities causing monetary loss to teachers/Government, the loss sustained by teachers/Government shall be recoverable from the Manager under the provisions of the Revenue Recovery Act. Chapter III Rule 3 mandates that the management of the schools under the educational agency shall vest in the Manager. But Sub-rule (4) of the said Rule mandates that the Educational Agency shall be bound by the actions of the Manager.

3. The learned Government Pleader submits that the petitioner being the Manager at the relevant time when the action was initiated is bound to be proceeded against for recovery of the amount due and that is why revenue recovery notices were issued in the

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