Johnson John, J.

1. These intra court appeals are filed against the common judgment dated 24.06.2022 in W.P.(C) Nos. 29313 and 29169 of 2018.

FACTUAL BACKGROUND:

2. The writ petitioners, while working as part-time sweepers, under the erstwhile Thrissur District Co-operative Bank Ltd. (subsequently merged with the Kerala State Co-operative Bank), were terminated from service with immediate effect as per Exhibit P7 order dated 09.11.2017 and thereafter, as per order dated 13.08.2018, the entire selection process in connection with the appointment of the writ petitioners were cancelled and the Bank decided to initiate fresh selection process. The writ petitions are filed challenging the said orders and also to reinstate the petitioners in service forthwith, with consequential benefits and continuity of service.

3. The Bank invited applications for the post of part-time sweepers as per Exhibit P1 notification dated 21.05.2015 and the said notification was challenged by an employee of Peringandur Service Co-operative Bank in W.P.(C) No. 20561 of 2015 for non compliance of the reservation provided in Rule 187 of the Kerala Co-operative Societies Rules, 1969 (‘KCS Rules’ for short). The said writ petition was allowed by this Court as per Exhibit P2 judgment dated 07.08.2015 and against the said judgment, the Bank filed W.A. No. 2048 of 2015, wherein this Court stayed the operation of Exhibit P2 judgment by an interim order and thereafter, the Bank proceeded with the selection process and on the basis of the rank list prepared, the petitioners were appointed.

4. Thereafter, the elected Managing Committee of the Bank was replaced by an Administrator and as per the decision of the Administrator, the Bank filed memo to withdraw the appeal and at that stage, the petitioners have taken steps to implead themselves in the writ appeal and therefore, the Division Bench disposed the Writ Appeal by reserving the right of the petitioners to challenge the judgment in W.P. (C) No. 20561 of 2015. Subsequently, the petitioners filed W. A. No. 2258 of 2017 and the said writ appeal was allowed declaring that Exhibit P1 notification issued by the Bank is legal and valid and it was further held that the contention of the Administrator that many of the appointees are ineligible, is beyond the scope of the issues involved in the said proceedings.

5. As per the impugned common judgment, the orders of the Administrator terminating the service of the petitioners, cancelling the selection process and the appointment are set aside and also ordered that all necessary consequences shall follow forthwith.

6. W. A. Nos. 1601 and 1642 of 2022 are filed by the respondent Co-operative Bank and its Administrator. The appellants in W.A Nos. 1990 and 1991 of 2022 were not parties in the writ petitions and their applications for leave to file appeals on the ground that they also applied to the post of part-time sweeper pursuant to the notification issued by the Bank were allowed and hence, the said appeals were also numbered.

7. Heard Sri. P.C. Sasidharan, the learned Senior counsel appearing for the appellants in W. A. Nos. 1601 and 1642 of 2022 and Adv. O.V. Maniprasad appearing for the appellants in W. A. Nos. 1990 and 1991 of 2022 and also heard Sri. P.N. Mohanan, Sri. N. Anand and Smt. K.P. Santhi appearing for party respondents and Adv. A. Sreekala and Sri. Saneej M.S., learned Government Pleaders appearing for the official respondents.

Arguments Advanced:

8. The learned Senior counsel appearing for the appellant Bank argued that when the Administrator found that the entire selection process as also the rank list is vitiated and non est in the eye of law for various reasons, including non compliance of Rule 187 of the KCS Rules regarding reservation and appointing 18 persons for filling up 9 posts and for interviewing candidates who were disqualified during scrutiny and accepting fake and fraudulent certificates as proof of qualification and age, proceedings were initiated for terminating the employees.

9. It is pointed out that in the judgment of this Court in W.A. No. 2258 of 2017, it is specifically stated that the court is only considering the validity of the notification and that the contentions of the Administrator that many of the appointees are ineligible and there is non compliance of Rule 187 of the KCS Rules are not issues arising in the said proceedings and hence, the said issues were left open and therefore, the Administrator is justified in initiating the proceedings for terminating the service and cancelling the appointments of the petitioners.

10. It is argued that the statutory remedy available to the petitioners is to raise a dispute under Section 69 of the Kerala Co-operative Societies Act, 1969 (‘the Act’ for short) and also cited the decision of a larger Bench this Court in Association of Milma Officers' Ksheera Bhavan, Tvm and another v. State of Kerala and Others [2015 (1) KHC 779], wherein it is held that in the absence of any statutory violation or breach of public duty, a writ petition cannot be entertained against the co-operative societies registered under the Act. The learned Senior counsel also argued that the administrative authority has inherent power to correct accidental mistakes and cited the decision of the Honourable Supreme Court in State of U.P. v. U.P. State Law Officers' Association and others [(1994) 2 SCC 204] to canvass the position that those who come by the back door have to go by the same door.

11. Adv. Sri. P.N Mohanan argued that the appointment of the petitioners were after a selection process conducted by the then Managing Committee in a proper and legal manner and subsequently, the elected Managing Committee of the Bank was replaced by an Administrator and the impugned orders of the Administrator terminating the service of the petitioners and cancelling the selection process and appointment orders are passed without authority and without appointing an Inquiry officer to conduct an independent and impartial inquiry regarding the allegations.

12. It is argued that the writ appeal filed by the previous elected Managing Committee was withdrawn by the Administrator without proper authority. It is also pointed out that petitioners 1 to 3 and 7 in W.P.(C) No. 29169 of 2018 and petitioners 1 to 4 and 8 to 11 in W.P.(C) No. 29313 of 2018 have already completed their period of probation and were confirmed in service and as far as the other petitioners, their services cannot be terminated during probation period without prior permission of the Registrar as provided in Rule 184 of the KCS Rules. It is argued that the service of an employee who successfully completed the probation can be terminated only after initiating disciplinary proceedings as contemplated under Rule 198 of the KCS Rules.

ISSUES FOR CONSIDERATION:

13. In the light of the factual background mentioned above, the rival arguments advanced and the statutory framework governing the powers of the Administrator and the recruitment process, the following issues arise for consideration:

                  1. Whether the contentions challenging the maintainability of the writ petitions are legally sustainable?

                  2. Whether the Administrator can terminate the service of employees appointed by the previous Managing Committee without a formal inquiry and inquiry report?

                  3. Is there any valid ground for interference in the common judgment under challenge?

STATUTORY FRAMEWORK:

14. It is necessary to examine the statutory framework governing the powers of the Administrator and the recruitment process before examining the issues. Section 28 of the Act shows that the general body of the society shall constitute a committee for a period of five years in accordance with the bye-laws and entrust the management of the affairs of the society to such committee and Section 32 empowers the Registrar to appoint Administrator or administrative committee to manage the affairs of the society, subject to satisfaction of the grounds mentioned in clauses (a) to (d) of Section 32.

15. Section 32(4) of the Act provides that the committee or Administrator or Administrators so appointed shall, subject to the control of the Registrar and to such instructions as he may from time to time give, have power to exercise all or any of the powers and functions of the committee or of any officer of the society and take such action as may be required in the interests of the society. Section 80 of the Act deals with appointment of officers etc. of Co-operative Societies and Rule 182(2) of the KCS Rules provides that the committee shall be the authority competent to appoint employees in a co-operative Society.

16. Rule 184(3) of the KCS Rules provides that if the appointing authority decides that the probationer is not suitable for such appointment, it shall by order in writing discharge him from service or in case of promotion revert him to the lower category and the first proviso thereto shows that no such order shall be passed unless the prior approval of the Registrar therefore has been obtained and unless the person concerned has been given a reasonable opportunity of showing cause against the action proposed to be taken in regard to him.

17. The procedure for initiating disciplinary action and punishment that can be imposed are provided in Rule 198, and sub-Rule (2) of Rule 198 provides that no kind of punishment shall be awarded to an employee unless he has been informed in writing of the grounds on which it is proposed to take action against and he has been afforded an opportunity, including a personal hearing to defend himself. Every order awarding punishment shall be communicated to the employee concerned in writing stating the grounds on which the punishment has been awarded.

18. Rule 198(2A) provides that the committee of a society shall constitute a disciplinary sub-committee consisting of not more than three of its members, of whom one shall be designated as Chairman, but the President of the committee of the society shall not be a member in the disciplinary sub-committee. Rule 198(2B) provides that the disciplinary sub-committee so constituted shall inquire into the charges against the employee either by themselves or by engaging an external agency. The authority competent to impose various penalties on different categories of employees are shown in the table provided in sub-Rule (3) of Rule 198. Therefore, the rival submissions and the legality of the impugned orders are required to be examined in view of the aforesaid statutory framework.

ANALYSIS AND CONCLUSIONS:

19. It is not in dispute that the writ petitioners participated in the selection process initiated as per Exhibit P1 notification and they were subsequently appointed as per the rank list approved by the elected Managing Committee. Even though, the validity of Exhibit P1 notification was challenged, this Court upheld the validity of the notification as per the judgment in W.A. No. 2258 of 2017. It is also not in dispute that after the appointment of the Administrator, W.A. No. 2048 of 2015 filed by the Bank against the judgment in W.P.(C) No. 20561 of 2015 was withdrawn as not pressed at the instance of the Administrator.This Court disposed the said writ appeal by reserving the right of the petitioners to challenge the judgment in W.P.(C) No. 20561 of 2015 and accordingly, the petitioners filed W.A No. 2258 of 2017.

20. In Exhibit P7 order dated 09.11.2017, it is stated that as per the decision of the Administrator dated 09.11.2017, the petitioner was terminated from service with immediate effect. In Exhibit P10 memo dated 20.07.2018, the petitioners were directed to show cause within ten days regarding the allegations mentioned therein in connection with their age and educational qualifications and subsequently, as per Exhibit P14 order dated 13.08.2018, the appointment of the petitioners as part-time sweepers are cancelled and it is also stated that the Bank would initiate a fresh selection process based on the notification which was upheld by this Court by giving opportunities to all the applicants.

21. It is well settled that administrative committee cannot appoint employees on permanent basis in a co-operative society; however, to ensure smooth administration, under compelling circumstance, they can resort to temporary appointments which shall not give the appointees any vested right, as held by this Court in Rajan N. v. State of Kerala and Others [2016 (2) KHC 805]. It is also well settled that major policy decisions cannot be taken by an Administrator and such decisions are to be taken by the committee, as held by this Court in Trissur District Co-operative Bank v. State of Kerala [2003 (2) KLT 606]. In Gangadharan v. Administrator [1988 (1) KLT 624], it was held that it is desirable to limit the power of Administrators to discharge only routine functions, in as much as the Administrator or administrative committee are nominees of Registrar and therefore, it is not desirable that they should be enabled to exercise all the powers and functions of the Managing Committee.

22. It is pertinent to note that before issuing Exhibit P7 order terminating the service of the petitioners, the Administrator has not ordered any independent inquiry regarding the allegations against the petitioners and there is also no material to show that the Administrator obtained the concurrence of the Registrar before terminating the petitioners from the service of the society with effect from 09.11.2017. Exhibit P10 memo is seen issued on 20.07.2018 after terminating the service of the petitioners on 09.11.2017.

23. It is pointed out that the Administrator issued Exhibit P10 memo without reinstating the petitioners on the basis of the judgment of this Court in W.A. No. 2258 of 2017 and without obtaining any concurrence from the Registrar. Exhibit P14 order dated 13.08.2018 cancelling the entire selection process and appointment order is also without conducting any independent inquiry and without giving opportunity to the petitioners to substantiate their contentions before an Inquiry Officer.

24. The larger Bench decision of this Court in Association of Milma Officers' Ksheera Bhavan (supra) would show that a writ petition would lie against a Co-operative Society when the duty owned by the Co-operative Society is of a public nature or when there is infringement of any statutory rules by such a Co-operative Society. In Debashish Mohapatra & Ors.v. District and Session Judge, Jagatsinghpur & Ors. [2026 LiveLaw (SC) 721], the Honourable Supreme Court held that the termination of services of confirmed Government servants through a simpliciter administrative order, without conducting a departmental enquiry, is a manifest violation of the procedural safeguards guaranteed under Article 311(2) of the Constitution. It is further held that constitutional intent is clear that in a democratic republic governed by the rule of law, public employment cannot be terminated at the unfettered discretion of the employer. In paragraphs 15 and 16 of the said judgment, the Honourable Supreme Court held thus:

                  “15. The framers of the Constitution, conscious of the abuse of executive power that had characterised colonial administration, deliberately incorporated these protections so as to secure fairness, impartiality, and procedural propriety in matters affecting public servants. Article 311 thus represents not merely a service protection but a constitutional commitment to the rule of law.

                  16. The Constitution, however, recognises limited exceptions to this requirement. The second proviso to Article 311(2) contemplates three situations in which an inquiry may be dispensed with: first, where dismissal, removal, or reduction in rank is founded upon conduct which has led to a criminal conviction; secondly, where the competent authority records in writing its satisfaction that it is not reasonably practicable to hold such inquiry; and thirdly, where the President or the Governor, as the case may be, is satisfied that in the interest of the security of the State it is not expedient to hold the inquiry. Thus, save and except these narrowly tailored exceptions, the holding of an inquiry prior to dismissal, removal, or reduction in rank remains the constitutional rule and not a matter of discretion.”

25. Co-operative Banks operate under the statutory supervision of the Reserve Bank of India and are governed by the Banking Regulation Act, 1949. Therefore, the employment under a Co-operative Bank carries an element of public nature and because of this public law element, service or employment disputes involving statutory rules in Co-operative Banks are amenable to a challenge under Article 226 of the Constitution of India. In that circumstance, the principles laid down by the Honourable Supreme Court in Debashish Mohapatra (supra) are applicable in the present case.

26. The learned Senior counsel for the appellant Bank argued that after the amalgamation of the erstwhile District Co-operative Banks with the Kerala State Co-operative Bank, all recruitments are to be made by the Kerala State Co-operative Bank based on the recruitment rules framed by it as per G.O.(P) No.119/2021/Co-op. dated 02.08.2021 and therefore, the appellants cannot make any appointments in violation of the above recruitment rules. But, the learned counsel for the respondents pointed out that in view of the special provisions relating to the amalgamation inserted by Act 1 of 2019 as Chapter XC, the arguments of the learned counsel for the appellants cannot be accepted. Sub-Sections 12 and 13 of Section 74H of the Act reads thus:

                  74H. Amalgamation of District Co-operative Banks to the Kerala State

                  Co-operative Bank.—

                  xxx

                  (12) Any proceedings, suits, decrees, recovery certificates, appeals, and all other legal proceedings pending or existing immediately before the date of amalgamation before any Court or Tribunal or any other authority, by or against the transferor bank may, as from the date of amalgamation be continued and enforced by or against the transferee bank.

                  (13) Every permanent and regular employee of the transferor bank or employees on probation, serving in the employment of the transferor bank immediately before the date of amalgamation, shall become, on and from the date of amalgamation, an employee of the transferee bank and shall hold office therein or serve the transferee bank, as the case may be, and shall continue to work in accordance therewith.”

                  In view of the above special provisions in the Act relating to the amalgamation, the arguments of the learned counsel for the appellants in this regard are not legally sustainable.

27. Another argument of the learned Senior counsel for the appellant Bank is that the administrative authority has inherent power to correct accidental mistakes and that the Administrator has the power to initiate disciplinary action. But, it is pertinent to note that in this case, the Administrator has terminated the service of employees and also cancelled the selection process and appointment order issued by the previous Managing Committee and therefore, it cannot be treated as mere correction of mistakes.

28. In State of West Bengal and others v. Jai Hind Private Limited [(2026) 5 SCC 481], the Honourable Supreme Court held that quasi judicial authorities can exercise only those powers which are expressly conferred upon them by the statute and hence, the power of review of their earlier orders are not available, unless it is conferred expressly or by necessary implication in the statute. Therefore, the arguments of the learned counsel for the appellant Bank that the Administrator is competent to review the earlier decision taken by the elected Managing Committee in connection with the selection process and appointment cannot be accepted.

29. The third party appellants in W.A. Nos. 1990 and 1991 of 2022 have no case that they challenged the selection process at any point of time before the pronouncement of the impugned common judgment. It is pertinent to note that the learned single Judge has observed in paragraph 33 of the impugned judgment that no candidate had challenged the selection process at any point of time and therefore, it can be seen that the third party appeals filed by them are only an afterthought so as to support the writ appeals filed by the Bank and the impugned orders passed by the Administrator.

30. In this case, the appellant Bank has not conducted any departmental enquiry and no opportunity was given to the petitioners to substantiate their contentions before an Inquiry Officer. Section 32(4) of the Act clearly shows that the Administrator can exercise his powers only subject to the control of the Registrar and according to his instructions and in the absence of any material to show concurrence of the Registrar in support of the impugned orders passed by the Administrator, it cannot be held that the Administrator exercised his powers in accordance with the mandate under Section 32(4) of the Act.

31. As noted earlier, the Administrator chose not to appoint an Inquiry Officer to inquire into the allegations and give the petitioners a proper opportunity to substantiate their contentions.

32. This Court has a constitutional obligation to ensure fairness. Here, the employees were appointed through a duly initiated public selection process and had rendered long years of service, yet they were terminated without any proper inquiry. In such circumstances, this Court must reinstate them with continuity of service and all consequential benefits. Accordingly, the issues are answered against the appellants, and the appeals are liable to be dismissed.

In the result, the appeals are dismissed.