The Judgment of the Court was delivered by
Lokeshwar Singh Panta, J.:— Petitioner-S.S Rana has filed this writ petition under Articles 226/227 of the Constitution of India for issuance of an appropriate writ, order or direction to the respondents. The reliefs sought for in the writ petition are as under:
“(a) Order that the termination of services of the petitioner without supply of enquiry report is illegal and the termination of his services vide Annexure P-16 dated 18.11.1993 be kindly quashed and set aside, along with appellate order dated 16.1.1996 Annexure P-24:
(b) That the Enquiry held by the Enquiry Officer be kindly held vitiated by the procedural irregularities as the circumstances appearing against the petitioner were not pointed out nor was the defence statement invited/called for:
(c) That the petitioner be held entitle to all the consequential benefits after quashing of the punishment order dated 18.11.1993 annexure P-16 along with appellate order dated 16.1.1996 Annexure P-24, such as re-instatement in service, arrears of back wages arrears of ex-gratia payment as well as promotion in the category of officer Grade-I with effect from the date his immediate junior Sh. BB. Gupta has been so promoted during the year 1992. The arrears as detailed above may kindly be ordered to be paid along with interest at the rate of 18% p.a:
(d) That exemplary cost of this petition be kindly allowed against the respondent No. 2 Bank for causing hardship to the petitioner for keeping the appeal pending for unjustified period of above two years:
(e) That respondents be directed to produce the record of the case for perusal by this Hon'ble Court;
(f) That any other order deem just and proper in the facts and circumstances of the case, may kindly be passed in favour of the petitioner and justice be done to parties.
2. The case of the petitioner is that he is a matriculate and was initially appointed as clerk in the Kangra Central Co-operative Bank Limited-respondent No. 2-Bank herein with his posting at Bank Branch, Hamirpur. Subsequently in the year 1965, he was promoted as Cashier and thereafter as Branch Manager in the year 1970 and was posted at Kangra Branch Daulatpur Chowk, District Unatill 1973. Subsequently, the petitioner was transferred to branch office, Jawali where he remained posted from the years 1975 to 1975. In the year 1975, the petitioner was posted in the Head Office of respondent No. 2-Bank at Dharamshala and was deployed as statistical Incharge in his original capacity as Branch Manager where he served the Bank till the year 1982. The petitioner was again posted as Branch Manager in the Bank Branch, Raja-ka-Talab, Tehsil Nurpur, District Kangra in the year 1982 where he remained posted till the year 1987 and from 1987 to 1988 the petitioner remained posted at Branch office Kotla Nurpur. Again the petitioner was posted at Bank Branch Raja-ka-Talab wher he worked from the year 1988 to February, 1991. Form March 1991 to the year 1992, the petitioner remained posted as Branch Manager at Dehra and was finally posted during the year 1992 as Branch Manager at Chanaur, Tehsil Dehra.
3. According to the petitioner all through his service career he has maintained highly exemplary service record and nothing adverse had ever been recorded or communicated to him upto the year 1998. He was awarded appreciation letters/momentos. The petitioner stated that in the normal course of service, he was to retire/superannuate on 30.9.1996 The petitioner as Branch Manager was exercising his powers of sanctioning advance leans to the secondary co-operative Societies. When the petitioner was serving as Branch Manager, Kotla, respondent No. 2-Bank communicated a circular dated 10.12.1973 issued by the Bank on the subject of sanction of medium term loan for agricultural purposes vide letter dated 16.12.1987 The circular stipulated advancement of medium term agricultural loans upto the amount of Rs. 10,000/- by the Branch Manager and copies of the letters dated 16.12.1987 and 10.12.1973 are annexed with the writ petition as Annexures P-1 and P-2 respectively. Respondent No. 2-Bank revised the powers of its officers for sanction of medium term agricultural loans vide circular dated 28.4.1988, a copy of the same is annexed as Annexure: P-3. The powers of the Branch Manager to advance medium term loan was enhanced to Rs. 30,000/-. Respondent No. 2-Bank appreciated the over all increase in the business of the Branch of Raja-ka-Talab of which the petitioner was Branch Manager and in recognition of his service the Chairman of the respondent-Bank sent a letter dated 18.7.1987 to him, a copy of whereof is annexed as Annexure P-4. Similarly, the Board of Directors of respondent No. 2-Bank vide resolution No. 22 dated 6.4.1987 resolved to give momento to the petitioner for his good performance as Branch Manager. The petitioner was summoned to the Head Office of respondent No. 2-Bank on 18.6.1987 for presentation of the memento and award of appreciation letter dated 12.6.1987, a copy thereof is placed on record as Annexure: P-5.
4. Under the Himachal Pradesh Co-opertive Societies Act, 1968 (for short ‘the Act’) the audit of every registered Co-operative Society is required to be held once in a each year. Under Rule 83 of the Himachal Pradesh Co-operative Society Rules, 1978 (hereinafter referred to ‘the Rules’), the annual audit of Co-operative Societies is to be conducted. The financial transactions of the branches of respondent No. 2 functioning under the control and supervision of the petitioner were found correct upto to 1991 and no discrepancy etc. was ever pointed out by the audit party.
5. A memorandum of chargesheet dated 14.9.1991 mark Annexure P-6 was issued by the Managing Director of respondent No. 2-Bank to the petitioner proposing to hold an, inquiry against him under Rule 56(b) of Rules relating to the terms of employment and working condition of the employees of the Bank read with Section 35(b)(4) of the Act. In the memorandum, seven articles of charges were levelled against the petitioner pertaining to imputations of misconduct when he was working as Branch manger in Raja ka-Talab, a copy of the chargesheet along with list of documents and list of witnesses is placed on record as Annexure P-6. The petitioner was called upon to submit his reply to the chargesheet within two weeks from the receipt of the memorandum of charges The petitioner was not in possession of the documents relied upon against him as the had been transferred to Dehra Branch of respondent No. 2-Bank, therefore, the petitioner vide his letter dated 24.9.1991 simply denied all the charges levelled against him. Shri N.C Katoch, Deputy General, Manager (Administration) of respondent No. 2-Bank vide letter dated 15.2.1991 (Annexure P-8) was appointed as Inquiry Officer to conduct the enquiry against the petitioner. During the pendency of the inquiry, the respondent No. 2-Bank with held the ex gratia payment of the petitioner for the year 1990-91.
6. The petitioner was informed by respondent No. 2-Bank vide notice dated 3.2.1999 (Annexure P-10) that preliminary hearing of the departmental inquiry against him shall be held on 15.2.1992 at 11.30 AM in branch office, Jawalamukhi. The petitioner appeared before the Inquiry Officer on 15.2.1992 On 10.12.1992 the petitioner was informed that the hearing of the departmental inquiry shall be held on 10.12.1992 at 1 p.m in the Branch Office at Jawalamukhi. Subsequently, on 10.12.1992 the venue of the inquiry was shifted to Raja-ka-Talab and the petitioner was accordingly informed vide letter dated 1.12.1991 (Annexure P-12). The inquiry scheduled to be held for 10.12.1992 was postponed till further orders by respondent No. 2-Bank as per communication dated 9.12.1992 (Annexure P-13) sent to the petitioner. The petitioner stated that during inquiry proceedings held on different dates no witness mentioned in the list of witness was ever examined by the Inquiry Officer in the presence of the petitioner nor any opportunity of cross-examination of the witnesses was ever afforded to him. The Inquiry Officer during the hearing of the inquiry had simply consulted the various documents listed in the Annexures to the chargesheet. The petitioner during the course of inquiry or while scrutiny of documents or after conclusion of the inquiry was never put any query/question nor was apprised of any evidence which might have surfaced against him. The petitioner produced two witnesses in his defence who said that the disbursement of medium term agricultural loans was made in the Branch premises in the presence of the petitioner being the Branch Manager. During the hearing of the the inquiry, the Inquiry Oficer obtained initials of the petitioner, his defence assistant as well as the Presenting Oficer of respondent No. 2-Bank on the proceedings of the inquiry which was concluded on 12.4.1993 Thereafter the petitioner was not informed about any further proceedings nor was the inquiry report supplied to him at any point of time. The Managing Director of respondent No. 2-Bank vide order dated 18.11.1993, a copy thereof is placed on record as Annexure P-16 terminated the services of the petitioner with immediate effect. The petitioner in the absence of the inquiry report was in total darkness as to how the charges were proved against him and what were the basis for finding the petitioner guality. The petitioner was not served the punishment order but on learning about the same from perusing of caveat proposed to be filed by respondent No. 2-Bank against his termination, the petitioner preferred an appeal against the penalty order (Annexure P-16) to the prescribed authority (Administration) of respondent No. 2-Bank, as the Board of Directors of respondent No. 2-Bank was superseded in December, 1990 otherwise the Board of Directors is the prescribed authority under Rule 64(9) Chapter-14 of the Kangra Central Co-operative Bank Employees (Terms of Employment and Working Condition) Rules, 1980 (hereinafter referred to Employees Rules, 1980). According to the petitioner as he was not served the order of removal dated 18.11.1993, he reported for his duty as Branch Manager in Bank Branch, Chanaur. Respondent No. 2-Bank vide letter dated 14.12.1993 (Annexure P-18) took an exception to it and asked him not to put his presence in the Bank Branch, Chanaur after 14.12.1993 The petitioner was not paid any salary/emoluments for the months of November, 1993 onwards. The petitioner also stared that he had verbal permission of the Administrator of respondent No. 2-Bank to join his duty pending the decision of the appeal preferred by him. Therefore, on receipt of letter (Annexure P-18), the petitioner vide communication dated 29.12.1993 represented to the Administrator requesting him to allow the petitioner to work in absence of receipt of termination order. The petitioner submitted a reminder dated 1.3.1994 (Annexure P-20) to the nominated Board of Directors for taking early decision on this appeal. The appeal was kept pending and consequently another reminder was sent by the petitioner on 31.3.1994 (Annexure P-21). The General Manager of respondent No. 2-Bank by latter dated 22.11.1994 requested the petitioner to appear before the Board of Directors on 28.11.1994 at 11 A.M in the Head office at Dharamshala for personal hearing. The petitioner in compliance to the said letter appeared before the Board of Directors. He was given an ineffective formal hearing by the Board of Directors and no further action was intimated to the petitioner for about more than two years. The petitioner vide his appeal/representation dated 26.12.1995 (Annexure P-23) made a last attempt for getting his statutory appeal decided which was pending for more than two years. Thereafter, the petitioner was constrained to give a final notice for decision of the appeal within 15 days in order to enable him to approach the Court of law in the absence of decision of the appellate authority. Respondent No. 2-Bank vide communication of Managing Director dated 16.1.1996 (Annexure P-24) informed the petitioner that his appeal was considered by the Board of Directors and the same was rejected vide resolution No. 19 dated 18.11.1995 According to the petitioner he was to retire/superannuate in due course on 30.9.1996 and he would have become entitled for payment of pension apart from other retiral benefits on his superannuation. Respondent No. 2-Bank also with-held his ex gratia amount of Rs. 50,000/- from the year 1990 onwards because of punishment order.
7. On these premises, the petitioner submitted that the inquiry held against him was in utter disregard on the principles of service jurisprudence and natural justice without affording him an opportunity to furnish his defence statement; the report of the inquiry was never supplied to him before passing of the order of termination of service; he was not given any show cause notice against the proposed punishment likely to be afflicated upon him and the statutory appeal of the petitioner was kept pending by the Appellate Authority for more than two year and lateron it was dealt with in a casual and unlawful manner.
8. In its reply filed by respondent No. 2-Bank supported by an affidavit of Shri Prabodh Saxena the then Managing Director preliminary objection was raised stating that respondent No. 2-Bank being a Co-operative Society registered under the Himachal Pradesh Co-operative Societies Act, 1968 is not a State within the meaning of Article 12 of the Constitution nor it is an instrumentality of the State, therefore, the writ petition is not maintainable as held by the Division Bench of this Court vide its judgment dated 5.3.1993 in CWP. No. 17 of 1979 titled C.K Malhotra v. H.P State Co-operative Bank Ltd. connected matters. On merit, it is stated that it was expected from the petitioner to act with due care and caution before fresh loans would have been advanced by him as recovery of earlier loans was irregular, as the petitioner did not bother/care to watch the interest of the Bank and continued to advance fresh loans to the concerned societies inspite of the fact that the recovery of the earlier loans was irregular which resulted in huge loss to the Bank by blockade of huge funds. It is stated that the petitioner never demanded the documents relied upon against him in the inquiry. He did not care to give proper reply to the charge sheet and simply denied seven charges in seven lines for the sake of denying these charges. The petitioner was afforded full opportunity by the Inquiry Officer during the course of inquiry proceedings to defend his case as such there was no question of denial of right of the petitioner to cross-examine the witnesses. It is also stated that after the close of inquiry, the inquiry report was submitted by the Inquiry Officer to the Disciplinary Authority; the Inquiry Officer to the Disciplinary Authority; the Disciplinary Authority too found the petitioner guilty of the charges levelled against him and decided to terminate his services as the petitioner was found having caused huge loss to the Ban due to his gross violation of instructions on the subject and repeatedly exceeding his loan sanctioning powers. Respondent No. 2-Bank further stated that the appeal of the petitioner was placed before the Board of Directors of the Bank in its meeting held on 3/4.6.1994 and the same was referred to the Executive Committee for consideration. The Executive Committee in its meeting held on 14.6.1994 resolved to refer the matter again to the Board of Directors with his complete report. Thereafter the Board vide its resolution No. 5 dated 19.8.1994 authorized the Managing Director to submit his report to the Board with the direction that the petitioner be also called for personal hearing by the Board. The Managing Director submitted his report before the Board of Directors in its meeting held on 18.11.1995 The petitioner was also heard by the Board. The Board fully concurred with the report of Managing Director that the petitioner was guilty of gross financial irregularities in the advancement of loans and his termination from the service of the Bank was found perfectly in order. Consequently, the Board vide its resolution No. 19 dated 18.11.1995 resolved to reject the appeal of the petitioner. Respondent No. 2-Bank also stated that the payment of ex-gratia to the petitioner has been with held as he has been found guilty of financial irregularities resulting the huge loss to the Bank to the tune of over Rs. 17 lacs and so far question of his promotion in the year 1992 was concerned he was not at all eligible as he was chargesheeted for the major misconduct and departmental inquiry was being held against him. It is also stated that the petitioner has the remedy to prefer a second appeal before the Registrar, Co-operative Societies, H.P against his termination order but he chose to file the present writ petition without exhausting the remedy of appeal.
9. In his rejoinder, the petitioner stated that respondent No. 2 Bank is the State within the meaning of Article 12 of the Constitution of India as it is discharging statutory function after being registered under the Co-operative Societies Act within the design and parameters of the Constitution of India. The State of Himachal Pradesh has got deep and pervasive control over the functioning of respondent No. 2-Bank and, therefore it cannot claim immunity from the extra ordinary writ jurisdiction of this Court. The petitioner has reiterated and re-asserted his entire averments made in the writ petition and denied the counter averments of the respondent No. 2-Bank made in its reply.
10. I have heard learned counsel for the parties. Mr. Rakesh Kanwar, learned counsel for the respondent No. 2-Bank contended that respondent No. 2-Bank is not discharging the public services in holding departmental inquiry against the petitioner for his mis-conduct. According to the learned counsel, respondent No. 2-Bank is discharging normal banking business and not public service and the present case is covered by a Division Bench of this Court in Chandresh Kumar Malhotra v. H.P State Coop. Bank, 1993 (2) Sim. L.C 243 in which it was held that respondent No. 2-Bank is not other authority and, as such, cannot be characterised as State within the meaning of Article 12 of the Constitution and the same is also not the authority within the meaning and for the purpose of Article 226 of the Constitution. He also submitted that it is settled position that Byelaws or service Rules/regulations framed by the Society have no force of law therefore, the petitioner has no legal right to approach this Court under Article 226 of the Constitution of India.
11. Per contra, Mr. O.P Thakur, learned counsel for the petitioner contended that in the light of the judgments of the Supreme Court in Ajay Hasia v. Khalid Mujib Sehravardi, (1981) 1 SCC 722 : [1980 (3) SLR 467 (SC)], B.S Minhas v. Indian Statistical Institute, (1983) 4 SCC 582 : [1983 (3) SLR 150 (SC)], Andi Mukta S.M.V.S.J.M.S Trust v. V.R Rudani, (1989) 2 SCC 691 : [1990 (7) SLR 154 (SC)], Whirlpool Corporation v. Registrar of Trade Marks, Mumbai, (1998) 8 SCC 1, U.P State Cooperative Land Development Bank Ltd. v. Chandera Bhan Dubey, (1999) 1 SCC 741, Director of Settlements, A.P v. M.R Apparao, (2002) 4 SCC 638 and Pradeep Kumar Biswas v. Indian Institute of Chemical Biology, (2002) 5 SCC 111 : [2002 (3) SLR 433 (SC)] : Respondent No. 2-Bank is wholly covered by the definition of State under Article 12 of the Constitution of India and it is performing legal duty as an authority under the Banking Regulations Act and therefore, respondent No. 2-Bank is amenable to the writ jurisdiction under Article 226 of the Constitution of India.
12. I have carefully considered the respective contentions of the learned counsel for the parties on the preliminary issue of the maintainability and also on the merits of the case. A Division Bench of this Court in C.K Malhotra's case (supra) exhaustively and meticulously considered the issue of maintainability of the writ petition filed by the employees against three Co-operative Societies, namely, H.P State Co-operative Bank Limited. The Mall, Shimla, The Kangra Central Co-operative Bank Limited, Dharamshala (respondent No. 2-Bank herein) and the H.P State Co-operative Marketing and Development Federation Limited, Shimla. The learned Judges while deciding the preliminary issue in the case of C.K Malhotra have considered the decision of the Supreme Court in Rajasthan State Electricity Board, Jaipur v. Mohan Lal, AIR 1967 SC 1857; Praga Tools Corporation v. C.V Imanual, (1969) 1 SCC 585 : AIR 1969 SC 1306 : [1971 (1) SLR 791 (SC)]; Dr. Dr S.L Agarwal v. General Manager, Hindustan Steel Ltd.† , (1970) 1 SCC 177 : AIR 1970 SC 1150 : Sabhajit Tewary v. Union of India, (1975) 1 SCC 485 : AIR 1975 SC 1329 : [1975 (1) SLR 422 (SC)] : Sukhdev Singh v. Bhagatram Sardar Singh Raghuvanshi, (1975) 1 SCC 421 : AIR 1975 SC 1331 : [1975 (1) SLR 605 (SC)] : Ramana Dayaram Shetty v. The International Airport Authority of India, (1979) 3 SCC 489 : AIR 1979 SC 1628; Ajay Hasia etc. v. Khalid Mujib Sehrawardi etc., (1981) 1 SCC 722 : AIR 1981 SC 487; State of West Bengal v. Nripendra Nath Bagchi, AIR 1966 SC 447; Chief Justice of Andhra Pradesh v. L.V.A Dikshitulu etc., (1979) 2 SCC 34 : AIR 1979 SC 193 : [1979 (1) SLR 1 (SC)]; P.K Ramachandra Iyer v. Union of India, (1984) 2 SCC 141 : [1983 (3) SLR 495 (SC)]; Biha. State Harijan Kalyan Parishad v. Union of India, (1985) 2 SCC 644; Board of Trustees, Ayurvedic and Unani Tibia College, Delhi v. State of Delhi, AIR 1962 SC 458; Daman Singh v. State of Punjab, (1985) 2 SCC 670; M.C Mehta v. Union of India, (1987) 1 SCC 395 : AIR 1987 SC 1086; Tekraj Vasandi alias K.L Basandhi v. Union of India, (1988) 1 SCC 236 : AIR 1988 SC 469 : [1988 (3) SLR 345 (SC)]; Central Inland Water Transport Corporation Ltd. v. Brojo Nath Ganguly, (1986) 3 SCC 156 : AIR 1986 SC 1571 : [1986 (2) SLR 345 (SC)]; Prathama Bank, Head Office Moradabad through its Chairman v. Vijay Kumar Goel, (1989) 4 SCC 441 : AIR 1989 SC 1977; Chander Mohan Khanna v. National Council of Educational Research and Training, (1991) 4 SCC 578 : [1991 (6) SLR 68 (SC)]; Som Prakash Rekhi v. Union of India, (1981) 1 SCC 449 : AIR 1981 SC 212 : [1981 (1) SLR 154 (SC)]; Ajmer Singh v. The Registrar, Co-operative Societies, Punjab Chandigarh, AIR 1981 P & H 107 : [1980 (3) SLR 347 (Pb. & Hry.)]; A Full Bench of Kerala High Court in P. Bhaskaran v. Additional Secretary, Agricultural (Co-operation) Department, Trivandruam, AIR 1988 Ker 75; A Full Bench judgment of Madras High Court in R. Thamilarasan and v. The Director of Handlooms and Textiles, Madras, 1989 (1) Labour Law Journal 588; and A Full Bench decision in Sri Konaseema Cooperative Central Bank Ltd., Amalapuram v. N. Seetharama Raju, AIR 1990 AP 171 and some other judgments of the other High Courts on the question of whether the various authorities, Corporations and ‘Societies’ involved in those cases are instrumental or the agency of the ‘State’ for the purpose of Article 12 and whether the State Govt. has pervasive control over such ‘authorities’, ‘Corporations’ and ‘Societies’ and also whether such authorities are amenable to the writ jurisdiction of the Supreme Court under Article 32 of the Constitution of India and of the High Court under Article 226 of the Constitution of India. In the case of C.K Malhotra, the learned Judges have also considered the relevant provisions of Section 3 of the H.P Co-operative Societies Act dealing with the appointment of Registrar and other officers to assist him; registration of co-operative Societies under Section 5; the main purpose of Section 6 and under Section 4 of the Act. The Court stated in paragraphs 58 of the report that the main object of a Society should be the promotion of the economic and social interest of its members or of the public, in accordance with the provisions of the co-operative principles. Further it is observed that the amendment in the bye-laws of the Co-operative Society shall not be valid unless approved by the Resolution of general meeting as provided under Section 11 of the Act. The amendments are thereafter to be got registered with the Registrar, who is also empowered to refuse registration under certain eventualities. The Registrars is empowered under Section 11-A of the Act to direct the amendment of the bye-laws, if found necessary or desirable in the public interest or in the interest of Society or in the interest of co-operative movement. If the society fails to make amendment, within the time specified by the Registrar, after giving the society an opportunity of being heard, the Registrar can order the amendment to be carried out in the bye-laws. The amalgamation, transfer of assets and liabilities, conversion and division of Societies is envisaged under Section 14, subject to the approval of the Registrar who is also empowered to direct amalgamation, conversion and reorganisation of the Societies, if he is satisfied that it is essential or desirable in the public interest of co-operative movement for the purpose of securing of proper amalgamation of any Society or Societies under Section 14-A of the Act. The judgment proceeded to observe that Section 18 of the Act enumerates two other type of members, namely, nominal or associate members and section 20 says that nominal or associate members shall have no right to vote, otherwise every member of the Society shall have one vote in the affairs of the Society. Third proviso to Section 20 says that where the Government is a member of the Society, each person nominated by the Government shall have one vote. The final authority in a co-operative society shall vest in the general body of members in a general meeting under Section 31. Section 35 deals with the nominees of the Government and other nominees on the Committee of the Co-operative Society. Section 35-A empowers the Registrar to constitute new Committee in certain cases. The State Govt. can appoint the Managing Director of the Society under Section 35-B of the Act which was inserted by the Himachal Pradesh Co-operative Societies (Amendment) Act, 1986. The powers and functions of Managing Directors are also given under Section 35-B. Section 48 enumerates the forms of State Aid to Co-operative Societies. The other relevant sections of the Act, namely, 56, 60, 61, 62, 63, 64, 65, 66, 67, 68, 69, 71, 72 and 73, 78, 79, 83, 90 and 109 are also considered by the learned Judge in paragraphs 70, 71, 72 and 73 of the report on the question of pervasive control of the State Govt. over the societies.
13. In exercise of the powers under Section 109 of the Act, the State Government has framed rules known as the Himachal Pradesh Co-operative Societies Rules, 1971 (hereinafter referred to Rules 1971). The relevant rules are dealt with in paras-74 and 75 of the report. After noticing the Government's contribution to the share capital of the respondent 2-Bank, bye-laws 37 of respondent No. 2-Bank, the learned Judge held that in framing and determining the general policy of respondent No. 2-Bank, the role played is by the general Body and there is absolutely no control either of the Registrar or of the State Government. Further it is said that the policy of the society has to be strictly in consonance with the privations of Section 4 of the Act, wherein it is stated that the main objects have to be the promotion of the economic and social interests of its members or the public in accordance with the co-operative principles. The learned Judges of the Division Bench applying the six tests summarised by the Supreme Court in International Airport Authority's case held that mandamus can be issued to compel an authority to do something and it must be shown that Statute impose a legal duty on that authority and the aggrieved party has a legal right under the Statute to enforce its performance. It is further held that the rights which the petitioners in that case are claiming are not the rights under the Statutes, but the same are claimed under the Bye-laws of Society which have no force of law. The Societies are also not discharging any public duty or any public functions and, as such, the writ of Mandamus would not lie. The Bench in para-98 of the judgment summoned up as under:
“Consequently, we have no hesitation in holding that the three Societies, namely, The Himachal Pradesh State Co-operative Bank Ltd. The Kangra Central Co-operation Bank Ltd., and the Himachal Pradesh State Co-operative Marketing and Development Federation Ltd., are not other authorities and as such, cannot be characterised as ‘State’ when the meaning of Art. 12 of the Constitution and the same are also not authority within the meaning and for the purpose of Article 226 of the Constitution. Order passed by the Societies under their respective service regulations against its employees, as such, or in connection with employment cannot be corrected by way of writ petitions The petitions also would not be maintainable in order to challenge the action of the registrar since the same is not an exercise of statutory power conferred upon him under the provisions of the Act or the Rules but an exercise of powers by him under service regulations framed under By-laws having no force of law. The writ petition also will not be maintainable since none of the three Societies are discharging any public functions.
In view of our having upheld that preliminary objection all the writ petitions are dismissed as not maintainable in this Court for the reliefs claimed.”
14. One Ajmer Singh filed a CWP. No. 341 of 1993 against the Hamirpur District Co-operative Marketing and Consumers Federation Ltd. and others in this Court challenging the validity of impugned order of the Administrator of the Societies appointed by the Registrar under the H.P Co-operative Societies Act, reverting Ajmer Singh to the post of Salesman. The said petition was referred by a Division Bench by order dated 16.4.1993 to the Full Bench. The opinion of the division Bench was that the decision in the writ petition registered as CWP. No. 17 of 1979, C.K Malhotra v. H.P State Co-operative Bank Ltd., 1993 (2) Sim L.C 243 was not in tune with the decisions of the apex Court reported in several judgments mentioned in the 1st paragraph of the judgment of the Full Bench. In that case the Full Bench held that since the main order was passed by the Administrator appointed by the Registrar, he is an authority under Article 12 of the Constitution and thus amenable to the writ jurisdiction. In paragraph-13 of the judgment reported in 1995 (1) Sim. L.C 395, the Full Bench observed as under:
“13. In view of the above legal position, we hold that the present writ petition is ‘maintainable and this court can issued appropriate writ. We, therefore, need not consider as to whether respondent No. 1 Co-operative Society is an authority under Article 12 of the Constitution or whether the said authority is discharging public duties in the case in hand.
Further; in para-14, the Court said: We may state here that in C.K Malhotra (supra), this aspect of the matter was no considered as there was no such occasion and, therefore, the law laid down by the Division Bench of this Court in the above, case need not detain us for deciding the present dispute.”
15. The Full Bench, has not considered it necessary to record any finding about the correctness and validity of the judgment of the Division Bench in C.K Malhotra's case whereby and hereunder it was held that respondent No. 2 cannot be characterised as State within the meaning of Article 12 of the Constitution and the same is also not within the meaning of Article 226 of the Constitution of India.
16. In Civil Writ Petition No. 692 of 1993 titled, A.D Kashyap v. The Board of Directors of the H.P State Co-operative Bank Ltd. The Mall, Shimla the Division Bench of this Court dated 23.4.2003 relying upon the earlier judgment of the Division Bench in Chandresh Kumar Malhotra's case and the ratio of the judgment of the Full Bench in Ajmer Singh's case again held that the writ petition was not maintainable against the order of the Managing Director of the Bank whereby punishment was imposed upon the petitioner A.D Kashyap.
17. I have considered the judgments of the apex Court relied upon by the learned counsel for the petitioner. In Whirlpool Corporation v. Registrar of Trade Marks, Mumbai, (1998) 8 SCC 1 the scope and power of the High Court to issue prerogative writs under articles 226 of the Constitution has been considered. In paragraphs 14 and 15 off the report, the Supreme Court held as under:
“14. The power to issue prerogative writs under Article 226 of the Constitution is plenary in nature and is not limited by any other provision of the Constitution. This power can be exercised by the High Court not only for issuing writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari for the enforcement of any of the Fundamental Rights contained in Part III of the Constitution but also for any other purpose.
18. Under Article 226 of the Constitution, the High Court, having regard to the facts of the cases, has a discretion to entertain or not to entertain a writ petition. But the High Court has imposed upon itself certain restrictions one of which is that if an effective and efficacious remedy is available, the High Court would not normally exercise its jurisdiction. But the alternative remedy has been consistently held by this Court not to operate as a bar in at least three contingencies, namely, where the writ petition has been filed for the enforcement of any of the Fundamental Rights or where there has been violation of the principle of natural justice or where the order or proceedings are wholly without jurisdiction or the vires of an Act is challenged. There is a plethora of case-law on this point but to cut down this circle of forensic whirlpool, we would rely on some only decision of the evolutionary ear of the constitutional law as they still hold the field.
19. In this case the issue whether Co-operative Societies can be characterised as a State within the meaning of Article 12, was not directly in issue before the Supreme Court.
20. In U.P State Cooperative Land Development Bank Ltd. v. Chandra Bhan Dubey, (1999) 1 SCC 741 : [1999 (2) SLR 576 (SC)], their Lordships considering the cases of the dismissed employees of the U.P State Cooperative Land Development Bank on the touch stone of the powers of the High Court under Article 226 and the provision of Article 12 of the Constitution of India held as under:
“The appellant U.P State Cooperative Land Development Bank though a cooperative society registered under the U.P Cooperative Societies Act, 1965 (for short the Societies Act) is constituted under the Uttar Pradesh Cooperative Land Development Bank Act, 1964 (for short the Bank Act). In exercise of power conferred on the State Government by Section 30 of the Bank Act, rules were framed called the U.P Cooperative Land Development Banks Rules, 1971. The service condition of the employees of the appellant are found in the Societies Act and the Regulations framed by the U.P Cooperative Institutional Service Board constituted under Section 122 of the Societies Act as well as to the Service Rules framed by the appellant under Regulation 102 of the Service Regulations. Service Rules framed by the appellant operate only after their approval by the Institutional Service Board. Any order of dismissal by the appellant can be issued only after its approval by the aforesaid Board. Under Section 3 of the Bank Act the sole State Land Development Bank is the appellant. It has thus exclusive jurisdiction for the whole of the State of Uttar Pradesh. It can admit as members land development banks whose number can be as many as may be deemed necessary by the Registrar of the Cooperative Societies for the State of Uttar Pradesh. The appellant is also vested with various powers under the Bank Act which powers are not available to a cooperative society registered merely under the Societies Act. Under the Bank Act, Registrar of the Cooperative Societies for the State of Uttar Pradesh shall the trustee for the purpose of securing the fulfilment of the obligations of the State Land Development Bank to the holders of debentures issued by the Board of Directors. The powers and functions of the trustee shall be governed by the provisions of the Bank Act and by the instrument of trust executed between the appellant and the trustee as modified or substituted from time to time by their mutual agreement and with the approval of the State Government. The trustee is to be a corporation sole. The Board of Directors of the appellant may from time to time issue debentures of various denominations with the previous sanction of the State Government may impose against the unconditional guarantee by the State Government for repayment in full of the principal and payment of interest thereon or on the security of mortgages, charges or hypothecations etc. Under Section 9 of the Bank Act, the State Government constitutes a Guarantee Fund on such terms and conditions as it may deem, fit, for the purpose of meeting losses that might arise on account of loans advanced by the land development banks on the security of mortgages not being fully recovered due to such circumtances as may be prescribed. The appellant and the land development banks shall contribute to such Fund at such rates as may be prescribed. Under Rule 6 of the Bank Rules, the Guarantee Fund shall be maintained by the Finance Department of the State Government in the Public Accounts Section of the State Accounts and all contributions to the Fund and interest earned on investment made from the Fund shall be credited direct to the Fund. All these provisions unmistakably show that the affairs of the appellant are controlled by the State Government though it functions as a cooperative society and it is certainly an extended arm of the State and thus an instrumentality of the State or authority as mentioned under Article 12 of the Constitution.”
21. Further in para-27 of the report it is said:
“In view of the fact that control of the State Government on the appellant is all pervasive and the employees had statutory protection and therefore the appellant being an authority or even instrumentality of the State, would be amenable to writ jurisdiction of the High Court under Article 226 of the Constitution, it may not be necessary to examine any further the question if Article 226 makes a divide between public law and private law. Prima facie from the language of Article 226, there does not appear to exist such a divide. The judgment further proceeded to hold that the Constitution's not a statute. It is a fountainhead of all the statutes. When the language of Article 226 is clear, one cannot put shackles on the High Court by putting an interpretation on the words which would limit their jurisdiction. Wen any citizen or person is wronged, the High Court will step in to protect him, be that wrong be done by the State, an instrumentality of the State, a company or a cooperative society or association or body of individuals, whether incorporated or not, or even an individual.”
22. In the case on hand, the respondent-Bank framed The Kangra Central Cooperative Bank Employees (Terms of Employment and Working Conditions) Rules, 1980. The Rules shall come into force from such date as the Registrar Co-operative Societies, Himachal Pradesh may appoint in this behalf. The Rules shall be subject to the provisions of the Himachal Pradesh State Co-operative Societies Act, 1968 or any other Co-operative Societies Act in force for the time being. The various categories of the Bank employees, their designation and pay scales are given in Rule 4(a) of the Terms of Employment and Working Conditions Rules. Under the Bye-laws No. 4 the objects of the respondent No. 2-Bank are specified. Respondent No. 2-Bank is admittedly a Society registered under the H.P Cooperative Societies Act and not under the provisions of the Banking Regulation Act. There is no pervasive control of the State Govt. over the employees of the Bank nor over its financial resources etc.
23. In Director of Settlements, A.P v. M.R Apparao, (2002) 4 SCC 638, the question for consideration was in regard to the application of Article 141 of the Constitution of India besides the said question, the Supreme Court also held that the powers of High Courts under Article 226 though are discretionary and no limits can be placed upon their discretion, they must be exercised along the recognized lines and subject to certain self-imposed limitations. The judgment proceeded to hold that the expression “for any other purpose” in Article 226, makes the jurisdiction of the High Courts more extensive yet the Courts must exercise the same with certain restraints and within some parameters. One of the conditions for exercising power under Article 226 for issuance of a mandamus is that, the Court must come to the conclusion that the aggrieved person has a legal right, which entitles him to any of the rights and that such right has been infrinsed. In Pradeep Kumar Biswas v. Indian Institute of Chemical Biology, (2002) 5 SCC 111, the question before the apex Court was whether the Council before the Apex Court was whether the Council of Scientific and Industrial Research is a State within the meaning of Article 12 of the Constitution of India. The majority of 5: 2 is thus:
“The Constitution has to an extent defined the word “State” in Article 12 itself as including “the Government… under the control of the Government of India”. That an “inclusive” definition is generally not exhaustive is statement of the abvious and as far as Article 12 is concerned, has been so held by the Supreme Court. The words “State” and “authority” used in Article 12 therefore remain among “the great generalities of the Constitution: the content of which has been and continues to be supplied by courts from time to time.”
24. It is also held as under:
“The significance of Article 12 lies in the fact that it occurs in Part III of the Constitution which deals with fundamental rights. The various articles in Part 111 have placed responsibilities and obligations on the “State” vis-a-vis the individual to ensure constitutional protection of the individual's rights against the State, including the right to equality under Article 14 and equality of opportunity in matters of public employment under Article 16 and most importantly, the right to enforce all or any of these fundamental rights against the “state” as defined in Article 12 either under Articles 32 or under Article 226.
25. Further it is said:—
“Initially the definition of State was treated as exhaustive and confined to the authorities or those which could be read ejusdem generis with the authorities mentioned in the definition of Article 12 itself. The next stage was reached when the definition of “State” came to be understood with reference to the remedies available against it. Thus, a statutory corporation, with regulations framed by such corporation pursuant to statutory powers was considered a State, and the public duty was limited to those which were created by statute.”
26. It is also held as under:—
“The picture that emerges from the case-law is that the tests formulated in Ajay Hasisa case, (1981) 1 SCC 722 for determining as to when a corporation can be said to be an instrumentality or agency of the Government are not a rigid set of principles so that if a body fails within any one of them it must, exhypothesi, be considered to be a State within the meaning of Article 12. The question in each case would be-whether in the light of the cumulative facts as established, the body is financially, functionally and administratively dominated by or under the control of the Government. Such control must be particular to the body in question and must be pervasive. If this is found then the body is a State within Article 12. On the other hand, when the control is merely regulatory whether under statute or otherwise, it would not serve to make the body a State.”.
27. On consideration of the propositions of law laid down in the earlier decisions, their Lordships held that, from the Rules and Regulations, 1999 of CSIR, the dominant role played by the Government of India in the Governing Body of CSIR is evident. In the light of the various parameters of the management and control of CSIR of the Government of India, CSIR is held to be a State and the judgment in Sabhajit Rewari's case, 1975 (1) SSC 485 was overruled. The above decisions of the Hon'ble Supreme Court in the facts and circumstances of the case on hand do not help the petitioner to contend that the State Government has a passive control over the functions and duties of the employees of respondent No. 2-Bank nor the Bank is wholly controlled by the State Government, therefore, in my view the ratio of the judgment of the Division Bench in C.K Mlalhotra's case (supra) and subsequent decision of another Division Bench in A.D Kashyap v. The Board of Directors of the H.P State Co-operative Bank Ltd. (supra) directly and squarely apply to the facts of the case in hand. In the light of the said decisions of the Division Benches, this writ petition is not maintainable since the respondent-Bank is not discharging any public function or public duties in the matter if dealing with the misconduct of the petitioner.
28. For the above said reasons, the writ petition is dismissed as not maintainable in his Court for the reliefs claimed by the petitioner. The submissions of the learned counsel for the petitioner on the merits of the case are left open without recording any finding as the petition is dismissed on preliminary objection of maintainability. Costs on parties.
29. Petition dismissed.