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2022 Supreme(Online)(KER) 17114

HIGH COURT OF KERALA
K VINOD CHANDRAN, C. JAYACHANDRAN, JJ
OLLUR TOWN CO-OPERATIVE SOCIETY LTD NO.R 1120,
– Appellant
Versus

DERLY K.J – Respondent
RP 1122 2022



Advocates:
T.R.HARIKUMAR, ARJUN RAGHAVAN, JELSON J.EDAMPADAM

Only the appointing authority can issue disciplinary charges, and back wages remain discretionary post reinstatement based on the disciplinary outcome.

Headnote:

Review - Disciplinary Proceedings - Act Section List - The court examined the validity of disciplinary actions based on authority to issue charges, as per recent judicial interpretations, and emphasized the need for fair procedures and proper authority in disciplinary matters.

Fact of the Case:

The disciplinary enquiry against the 1st respondent, an Accountant, concluded with dismissal based on alleged misconduct, which was later contested as invalid due to the issuing authority not being competent as per judicial precedent.

Issues: Whether the disciplinary proceedings were valid and whether the employee was entitled to back wages after reinstatement.

Ratio Decidendi: The court held that only the appointing authority can issue a memo of charges, and irregularities in the disciplinary process require a fresh enquiry and consideration of back wages at the conclusion of new proceedings.

Final Decision: The review petitions were allowed, directing a fresh enquiry and reconsideration of back wages.

O R D E R

K.Vinod Chandran, J.

The review petitions arise from a common judgment in two writ appeals and one writ petition. The subject matter of the writ petitions was the disciplinary enquiry initiated against the 1st respondent herein, who was the Accountant of the Society; the review petitioner herein. Disciplinary proceedings were initiated on charges of misconducts, including calculation of interest on certain specified accounts, which the delinquent employee asserted would not give rise to a charge of misconduct, especially if the other similar accounts are verified. The disciplinary enquiry ended in the dismissal of the delinquent, upon which the delinquent approached the Arbitration Court, which confirmed the order of the Disciplinary Authority.

2. On a challenge before the Co-operative Tribunal, the enquiry report was set aside and there was a direction to the Arbitration Court to verify the correctness of the enquiry proceedings and the enquiry report afresh. The employer filed the writ petition, in which it was directed that the employer will be allowed to adduce evidence before the Arbitration Court, thus ensuring that the allegation raised of a fair opportunity having not been given to the delinquent could be rectified atleast before the Arbitration Court. Both the employer and the employee filed writ appeals, which were disposed of by the common judgment, in which we called for a writ petition filed by the employee challenging the invalidity of the memo of charges;

which was also disposed of by the common judgment.

3. We found that the memo of charges was issued by the Disciplinary Sub-Committee, while the appointing authority was the Managing Committee. Kodanchery Service Co-operative Bank Ltd. v. Joshy Varghese [ 2020 (4) KLT 129 ] found that only an appointing authority can issue a memo of charges. The enquiry, hence, stood vitiated by reason of the subsequent declaration of law by this Court. We held so and directed the enquiry to be commenced from the stage at which the enquiry was found to have been vitiated. Liberty was granted to the employer to consider the objections to the show- cause notice filed by the employee and either accept the objections, dropping the proceedings, or issue a fresh memo of charges. We also directed that the period when the delinquent employee stood terminated shall be considered as spent on service and the entire benefits due to her shall be paid within a period of one month. The review is filed only as against the direction to pay the back wages. As of now, the employee is reinstated in service, a fresh memo of charges issued and the delinquent placed under suspension.

4. Sri.Arjun Raghavan, learned Counsel appearing for the employer Society, would place reliance on the decision in Chairman-cum-M.D., Coal India Ltd. v. Ananta Saha [ (2011) 5 SCC 142 ], wherein it is held that the question of back wages should be determined by the Disciplinary Authority in accordance with law, only on the conclusion of the fresh enquiry, especially when it is the settled law that if the enquiry ends in a termination, the same would relate back to the date of the earlier termination; when de novo proceedings are directed by a judicial forum. It is also argued that if a binding precedent was not noticed, it is a self evident error as has been spoken of in State of Rajasthan v. Surendra Mohnot [ (2014) 14 SCC 77 ].

5. Sri.Jelson P.Edumpadam, the learned Counsel appearing for the respondent employee, however would resist the review petition placing reliance on Deepali Gundu Surwase v. Kranti Junior Adhyapak Mahavidyalaya [ (2013) 10 SCC 324 ], wherein it has been declared that when the employer acts in gross violation of the statutory provision or gives short shrift to principles of natural justice or is guilty of having victimized the employee, then the Court or Tribunal would be fully justified in directing payment of full back wages. It is asserted that, termination is a definite consequence in the

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