IN THE HIGH COURT OF JUDICATURE AT MADRAS
D. BHARATHA CHAKRAVARTHY, J.
The Managing Director and Chief Executive Officer, Karur Vysya Bank Limited – Appellant
Versus
The Joint Commissioner of Labour Appellate Authority Under The Tamil Nadu Shops and Establishments Act, Erode – Respondent
W.P. Nos. 20688, 20691 of 2023, W.M.P. Nos. 20045, 20048 of 2023
Decided On : 19-02-2026
| Table of Content |
|---|
| 1. overview of the case and core issues faced by the appellant against reinstatement. (Para 1 , 2) |
| 2. discussion surrounding the dismissal procedure and employee's circumstances before the authority. (Para 3 , 4 , 5) |
| 3. the procedural fairness and jurisdiction concerns raised by the management. (Para 6 , 7 , 8 , 10) |
| 4. court's analysis of jurisdiction issues and directives on procedural compliance. (Para 12 , 14 , 30) |
ORDER :
1. These writ petitions are filed challenging the impugned award passed by the first respondent under Section 41 of the Tamil Nadu Shops and Establishments Act (XXXVI of 1947), whereby the appeal filed by the Workman against non-employment was allowed and reinstatement with back wages was ordered.
2. The brief facts leading to the filing of the writ petitions are that the petitioner-Management, namely, Karur Vysya Bank Limited, is a banking company with its Central Office at Karur and has several branches throughout the State of Tamil Nadu and across India. The employee, namely, Mr P. Kalamaegam, was working as Chief Manager in the Tirupur Main Branch between 16.04.2010 and 08.05.2013, and at the Tiruchengode Branch between 10.05.2013 and 01.12.2013. It is the case of the Management that during inspections of the two branches, sometime during the month of August 2013, certain shortcomings were noted, and it was found that 21 loan accounts, which had been sanctioned by the employee under his discretionary powers, had become Non-Performing Assets. There were also 19 similar instances in which certain lapses were recorded. In the meantime, the employee was transferred to Hyderabad and was working there. A charge-memorandum dated 27.01.2014 was issued to him. He submitted his explanation. A disciplinary enquiry was conducted. By an order dated 31.03.2016, he was dismissed from service.
3. Aggrieved thereby, the Workman originally filed an appeal under Section 41 of the Act before the Joint Commissioner of Labour, who is the Appellate Authority under the Tamil Nadu Shops and Establishments Act, Salem. When the matter was pending, he also attained the age of superannuation with effect from 31.01.2021. It is seen that the appeal was finally argued at Salem after the detailed enquiry and marking of documents. At that stage, a memo seems to have been filed on behalf of the employee, requesting the transfer of the case to the Joint Commissioner at Erode on the ground that the charges related to his action as Manager at Tirupur and Tiruchengode, and the Joint Commissioner at Erode, more particularly, had the territorial jurisdiction. It is seen from the original records, as submitted on behalf of the Appellate Authority, that on consideration of the memorandum, the Joint Commissioner himself, on 13.03.2023, transferred the matter to Erode. Thereafter, a notice of hearing was served on both parties to appear for the hearing on 11.04.2023. It is seen that the very same individual who was posted as Joint Commissioner at Salem was, in the meanwhile, transferred to Erode. Under the said circumstances, on 11.04.2023, both sides’ Counsel appeared in the enquiry and argued the matter, and from the records it is only written that the petitioner is present and the respondent is present, Orders reserved. Both Counsel for the Management and the employee have also signed. Thereafter, the impugned award was pronounced on 09.05.2023. Aggrieved by the same, the present writ petition is filed.
4. The Learned Counsel for the petitioner-Management assails the impugned award on the following grounds:
(i) When the notice of hearing was served by mentioning the date as 11.04.2023, in the impugned award, it is mentioned as if the hearing was concluded on 04.04.2013 which is was also a holiday on account of Mahavir Jayanti and, therefore, it can be seen that after the transfer, no opportunity whatsoever has been granted to the Management and therefore the impugned order is liable to be set aside for violating the principles of natur
The appellate authority must ensure proper jurisdiction and procedural fairness in employment dismissal cases while providing detailed findings on all charges.
Jurisdiction of the Appellate Authority under the Tamil Nadu Shops and Establishment Act, 1947.
Special Co-operative Societies Act and bye-laws exclude Shops Act jurisdiction for employee disciplinary appeals in co-operative banks.
Special Co-operative Societies Act prevails over general Shops Act; appeal under Shops Act not maintainable for co-operative bank employees.
Special Co-operative Societies Act prevails over general Shops Act; appeal under Shops Act Section 41 not maintainable for co-operative bank employees.
The appellate authority under Section 41(2) retains the power to modify disciplinary sanctions and must ensure proportionality while addressing misconduct.
The Tamil Nadu Shops and Establishments Act is not applicable to cooperative bank employees governed by the Tamil Nadu Cooperative Societies Act, establishing the primacy of special laws over general....
The jurisdictional issue can be raised at any stage of the proceeding and must be considered based on the date of cause of action. The court's jurisdiction is to be determined by the statutory mandat....
The main legal point established is that termination without a proper enquiry and imposition of shockingly disproportionate penalties is not sustainable under the applicable rules.
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