NOHARLAL VERMA Vrs. DISTRICT CO-OPERATIVE CENTRAL BANK LTD. JAGADALPUR

IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION


CIVIL APPEAL NO. 6161 OF 2008
ARISING OUT OF
SPECIAL LEAVE PETITION (CIVIL) NO. 16541 OF 2005



NOHARLAL VERMA ... APPELLANT

VERSUS

DISTRICT CO-OPERATIVE CENTRAL
BANK LIMITED, JAGDALPUR ... RESPONDENT



J U D G M E N T

C.K. THAKKER, J.

1. Leave granted.


2. The present appeal is directed against judgment and order passed by the Division Bench of the High Court of Chhattisgarh on May 04, 2005 in Writ Petition No. 283 of 2001. By the said order, the High Court dismissed the Writ 2 Petition filed by the appellant-petitioner and confirmed the order passed by the Madhya Pradesh State Co-operative Tribunal, Bhopal on January 22, 2001 in Second Appeal No. 560 of 1999.

3. Short facts giving rise to the present appeal are that the appellant herein was working as Manager in the Large Area Multi- Purpose Society (`LAMPS' for short). Between August, 1977 and August, 1981, the appellant was the Manager in the Schedule Tribe Service Co-operative Society, Kanker. He, at that time, committed financial irregularities.

Disciplinary proceedings were initiated against him and by an order dated April 29, 1982, passed by the Chairman, District Co-operative Central Bank Ltd., Jagdalpur (Bastar), he was removed from service. The appellant preferred a departmental appeal on April 30, 1982. Since he had not been communicated anything as to what had happened to the said appeal, the appellant on June 30, 1982 filed an application 3 under Section 55 of the Madhya Pradesh Co- operative Societies Act, 1960 (hereinafter referred to as `the Act') to the Joint Registrar, Co-operative Societies, Raipur.

According to the appellant, the application was made to the Joint Registrar, Raipur as District Bastar/Jagdalpur was within the territorial jurisdiction of Raipur. As stated by the petitioner, Joint Registrar then came to be appointed for District Bastar for Jagdalpur Area. Another application was, therefore, made on October 08, 1985 by the petitioner before the Joint Registrar, Co-operative Societies, Jagdalpur. On February 19, 1986, the Joint Registrar, Jagdalpur dismissed the application filed by the petitioner as time barred. The appellant preferred an appeal against the said order before the Board of Revenue, Gwalior.

However, the said appeal was also dismissed by the Board on June 14, 1990.

4. On October 22, 1990, the application filed by the petitioner on June 30, 1982 before 4 the Joint Registrar, Raipur was forwarded to Deputy Registrar, Kanker for adjudication. The Deputy Registrar, Kanker treated the case as within the period of limitation, considered it on merits and set aside the order of removal vide his order dated May 18, 1994. He also directed the Bank to pay all dues to the applicant.

5. The respondent Bank challenged the said order by approaching the State Co-operative Tribunal. The Tribunal allowed the appeal filed by the Bank on the ground of res judicata observing that an application filed by the appellant was dismissed by Joint Registrar, Jagdalpur and the said order was confirmed by the Board of Revenue, Gwalior dismissing the appeal which had become final.

6. The appellant being aggrieved by the order passed by the Tribunal preferred Writ Petition No. 283 of 2001 in the High Court of Chhatisgarh, which as stated above, was dismissed by the High Court. The said order is challenged in the present appeal.

7. On July 06, 2006, notice was issued to the respondents. Affidavit-in-reply and affidavit-in-rejoinder were thereafter filed.

An order was passed directing the Registry to place the matter for final hearing and that is how the matter has been placed before us.

8. We have heard the learned counsel for the parties.

9. The learned counsel for the appellant contended that the Tribunal as well as the High Court were wrong in dismissing the claim of the appellant. It was contended that the Tribunal was not right in holding that the appeal filed by the appellant was barred by res judicata.

The High Court was, therefore, right in observing that the Tribunal committed an error of law in treating the appeal as barred by res judicata. The High Court, however, went wrong in not allowing the writ petition and in coming to the conclusion that the application filed by the appellant/petitioner under Section 55 of the Act was barred by limitation and the Registrar had no power, authority or jurisdiction to entertain such dispute. The counsel contended that when the matter came up before the Tribunal, it was stated on behalf of the respondent-Bank through its counsel that the application was `within time' and hence, it was decided on merits. Thereafter, it was not open to the Bank to contend that the

application was beyond time and delay could not

be condoned.

10. The learned counsel submitted that

even on merits, the case did not call for

punishment of removal. Certain allegations were

made and even if it is assumed for the sake of

argument that all the allegations were true,

the appellant could not have been removed from

service. No financial loss has been caused to

the respondent-Bank. The appellant has

enormously suffered and he is out of employment

since more than fifteen years. Hence, even if
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this Court comes to the conclusion that

proceedings could have been initiated against

the appellant and he could have been punished,

on the facts and in the circumstances of the

case, this Court may direct the Bank to re-

instate the appellant without back wages so

that the appellant as well as his family

members would not be deprived of livelihood and

would not starve.

11. The learned counsel for the

respondent-Bank, on the other hand, supported

the order passed by the Tribunal and confirmed

by the High Court. It was contended that the

High Court was right in holding that the

application filed by the appellant was barred

by limitation. The counsel urged that the Act

provides by laying down maximum period of

limitation beyond which no application can be

entertained by the Registrar. If it is so, no

grievance can be made if the application filed

by the appellant was treated as barred by time.

The counsel did not seriously challenge the
8

view taken by the authorities that the

application could not be dismissed on the

ground of res judicata but submitted that the

application was time barred.

12. The counsel also submitted that the

Deputy Registrar, Co-operative Societies,

Kanker was not right when he stated that

consent was given by the counsel appearing on

behalf of the Bank that the application filed

by the appellant under Section 55 of the Act be

treated within time and the application was

admitted. The counsel, however, stated that

even if the counsel for the Bank had stated

that the application submitted by the appellant

could be treated within the period of

limitation, such concession being concession

against law would not bind the Bank. If the

statute stipulates a particular period of

limitation, no concession or order would make

an application barred by time to be within the

limitation and the authority had no
9

jurisdiction to consider such application on

merits.

13. On merits, the counsel urged that

considering the totality of facts and

circumstances, particularly, charges levelled

against the appellant and proved at the inquiry

which related to financial irregularities, if

the appellant was removed from service, it

cannot be said that no order of removal could

have been passed. The appellant was a Bank

employee and holding the office of Manager, a

position of trust. It is in the light of the

said fact that his case was required to be

considered which was done and punishment was

imposed.

14. Having heard the learned counsel for

the parties and having applied our mind to the

facts and circumstances of the case, in our

opinion, the appeal filed by the appellant

deserves to be dismissed. The High Court has

not committed any error of law which requires

to be interfered with in exercise of
1

discretionary and equitable jurisdiction under

Article 136 of the Constitution.

15. So far as res judicata is concerned,

in our opinion, the appellant is right in

submitting that the Tribunal was not justified

in holding that the application filed by the

appellant was barred by res judicata. It is

clear from the facts stated hereinabove that

the application was filed by the appellant to

Joint Registrar, Raipur. It was pending.

Meanwhile, however, District Bastar had its own

Registry and hence, an application was

submitted to District Registrar, Bastar. The

application preferred by the appellant to the

Joint Registrar, Raipur, in the circumstances,

became infructuous. It was not decided on

merits. As per settled law, such decision does

not operate as res judicata. The High Court

was, therefore, right in coming to the

conclusion that the Tribunal was in error in

dismissing the application on the ground of

res judicata. That part of the order passed by
1

the Tribunal was, therefore, rightly not

approved by the High Court.

16. But so far as limitation is concerned,

admittedly, the disciplinary proceedings

culminated against the appellant in an order of

removal. Such order was passed on April 29,

1982. An application against the said order was

made for the first time by the appellant/

applicant on June 30, 1982, i.e. after more

than two months.

17. Now, Section 55 of the Act empowers

the Registrar to determine conditions of

employment in societies. The said section, as

it then stood, read as under;

55. Registrar's power to determine
conditions of employment in
societies.-(1) The Registrar may, from
time to time, frame rules governing
the terms and conditions of employment
in a society or class of societies and
the society or class of societies to
which such terms and conditions of
employment are applicable shall comply
with the order that may be issued by
the Registrar in this behalf.

Provided that in the case of co-
operative credit structure, the
Registrar may frame rules governing
1

the terms and conditions of employment
on the basis of the guidelines
specified by the National Bank.

(2) Where a dispute, including a
dispute regarding terms of employment
working conditions and disciplinary
action taken by a society, arises
between a society and its employees,
the Registrar or any officer appointed
by him not below the rank of Assistant
Registrar shall decide the dispute and
his decision shall be binding on the
society and its employees:

Provided that the Registrar or the
officer referred to above shall not
entertain the dispute unless presented
to him within thirty days from the
date of order sought to be impugned:

Provided further that in computing the
period of limitation under the
foregoing proviso, the time requisite
for obtaining copy of the order shall
be exclused. (emphasis supplied)


18. Plain reading of the aforesaid

provision makes it more than clear that when a

dispute regarding terms of employment, working

conditions and disciplinary action taken by a

society and its employees arises, the officer

specified therein will decide such dispute

which shall be binding on the society and its
1

employees. The first proviso to sub-section

(2) of the said section prohibits the Registrar

from entertaining the dispute unless such

dispute is presented to him within thirty days

from the date of the order impugned. The second

proviso declares that in computing the period

of limitation, the time requisite for obtaining

copy of the order would be excluded. It is

thus clear that if an employee, aggrieved by

any decision taken by the society intends to

approach the Registrar, he must invoke

provisions of Section 55 of the Act by filing

an application within thirty days from the date

of such order or action.

19. In the instant case, admittedly, the

order of removal was passed by the Bank against

the appellant on April 29, 1982. Even the

first petition under Section 55 of the Act was

filed by the appellant/applicant on June 30,

1982, i.e. after two months which was time-

barred. The High Court considered the first

petition filed by the appellant herein before
1

the Registrar, Raipur, but even that petition

was barred by time. The High Court was,

therefore, right in dismissing the writ

petition holding that the application filed by

the applicant was not within the period of

limitation prescribed by Section 55 of the Act.

20. Learned counsel for the appellant,

however, submitted that the petition filed by

the applicant ought to have been treated within

the period of limitation. In support of such

contention, he relied on two aspects.

21. Firstly, the provisions of appeals and

revisions under the Act. Chapter X provides for

filing of appeals and revisions. Referring to

rule making power of the State (Section 95),

the counsel submitted that the State Government

has power to prescribe procedure in presenting

and disposal of appeals [Clause (gg) of sub-

section (2) of Section 95]. In exercise of the

said power, the State Government has framed

rules known as the Madhya Pradesh Co-operative

Societies Rules, 1962 (hereinafter referred to
1

as `the Rules'). Chapter IX as then stood

provided procedure in "Appeals and Revisions".

Rule 59 of the Rules laid down procedure in

filing an appeal to the State Government or to

the Registrar. Sub-rules (6), (7) and (8) to

which our attention has been invited by the

learned counsel read thus;

(6) If the appellate authority finds
that the appeal presented does not
conform to any of the said provisions,
it shall make a notice on the appeal
to that effect and may call upon the
appellant or his agent to remedy the
defects within a period of seven days
of the receipt of the notice to do so
or in case the appeal has not been
presented within the prescribed time
limit to show cause within the said
period of seven days why it should not
be dismissed as time-barred by the
appellate authority.

(7) If the defect is remedies or the
cause shown by the appellant or his
agent satisfies the appellate
authority, the appellate authority may
proceed to consider the appeal.

(8) If the appellant or his agent
fails to remedy the defects or to show
cause to the satisfaction of the
appellate authority within the said
period, the appellate authority may,
if the appeal is not presented within
the time-limit, dismiss the appeal as
time, barred. In cases where it is
1

considered necessary to give a
hearing, the appellate authority may
fix a date for hearing, of which due
notice shall be given to the appellant
or his agent.


22. We are of the view that the aforesaid

provisions do not apply to the case on hand.

Apart from the fact that Rule 59 merely lays

down procedure of appeals instituted within the

period of limitation and provides for removal

of defects, neither the provisions relating to

appeals nor of revisions apply to the case on

hand.

23. In our view, the scheme of the Act is

clear. Chapter X of the parent Act which deals

with appeals and revisions applies to those

cases where orders have been passed by the

authorities and officers under the Act and a

person is aggrieved by such orders. In the

present case, the action is taken not by an

authority or officer under the Act but by the

respondent-Bank. The appellant, therefore,

rightly applied to the Registrar under Section
1

55 of the Act complaining against such action.

The appellant could not have preferred an

appeal under the Act either to the Registrar or

to the State Tribunal. The provisions of

Chapter X of the Act relating to appeals and

procedure laid down in Chapter IX of the Rules,

therefore, had no application. The first

ground in support of the application that it

should be treated as within the period of

limitation has thus no force.

24. Secondly, the appellant contended that

the learned counsel appearing for the Bank

conceded that the application filed by the

appellant/applicant was within time and hence,

the Registrar took up for consideration the

said application and decided on merits.

Thereafter, it was not open to the Bank to

contend that the application was barred by

limitation. The order of the High Court,

therefore, deserves to be set aside. It was

also submitted that had it been contended

before the Registrar that the application was
1

not within the period of limitation prescribed

by law, the appellant could have satisfied the

authority or would have taken other steps, but

he was deprived by the concession on behalf of

the Bank. It has caused serious prejudice to

the appellant and the Bank cannot be allowed to

`blow hot and cold' by taking inconsistent

pleas and by raising `technical' defence of

limitation.

25. The learned counsel for the

respondent-Bank rightly submitted that the plea

raised by the appellant has no force. It was

submitted that there was no concession by the

Bank. Relying on Zimni, the counsel submitted

that on July 06, 1993, i.e. the day on which

the concession was said to have been made, the

Presiding Officer was not present as he was on

a tour. No proceeding took place on that day.

It was, therefore, factually incorrect to state

that a concession was made on behalf of the

Bank and it did not object that the application

was barred by time.
1

26. But even otherwise, according to the

counsel, if the application was not within the

period of limitation, the so-called concession

would neither bind the Bank nor invest

jurisdiction or power in the authority to

entertain such application which was barred by

limitation. In other words, according to the

counsel, the concession was against the

provision of law, which would not bind the

Bank.

27. Now, limitation goes to the root of

the matter. If a suit, appeal or application is

barred by limitation, a Court or an

Adjudicating Authority has no jurisdiction,

power or authority to entertain such suit,

appeal or application and to decide it on

merits.

28. Sub-section (1) of Section 3 of the

Limitation Act, 1963 reads as under;

(3) Bar of limitation.--(1) Subject to
the provisions contained in Sections 4
to 24 (inclusive), every suit
instituted, appeal preferred, and
application made after the prescribed
2

period shall be dismissed although
limitation has not been set up as a
defence. (emphasis supplied)


29. Bare reading of the aforesaid

provision leaves no room for doubt that if a

suit is instituted, appeal is preferred or

application is made after the prescribed

period, it has to be dismissed even though no

such plea has been raised or defence has been

set up. In other words, even in absence of such

plea by the defendant, respondent or opponent,

the Court or Authority must dismiss such suit,

appeal or application, if it is satisfied that

the suit, appeal or application is barred by

limitation.

30. As stated earlier, Section 55 allows

an aggrieved party to approach the Registrar

within a period of thirty days. There is no

provision analogous to Section 5 of the

Limitation act, 1963 allowing the Registrar to

condone delay if "sufficient cause" is shown.

In view of this fact, in our opinion, the
2

contention of the learned counsel for the Bank

is well founded that the application submitted

by the appellant was barred by time.

31. To us, the High Court was right in

observing that the Tribunal was in error in

allowing the appeal and dismissing the claim of

the appellant on the ground of res judicata.

The High Court, therefore, considered the said

question independently and held that the Bank

was right in submitting that the appellant had

not approached the Registrar within the period

prescribed by law and his application was

liable to be dismissed.

32. So far as the prayer by the appellant

that he has sufficiently suffered and should be

re-instated in service without back wages also

cannot be accepted. The appellant was holding

position of trust and was Manager of a Bank.

The charges leveled against him were serious in

nature concerning misappropriation of money.

It is true that the amount was not big and it

was also repaid and the Bank has not suffered.
2

But even then the Manager of a Co-operative

Bank was involved in financial irregularities.

The Bank was satisfied that he should not be

retained in service and passed an order of

removal.

33. In our opinion, by no stretch of

imagination, it can be said that such

punishment is grossly disproportionate or

excessively high. Normally in exercise of

power of `judicial review', a writ court will

not substitute its own judgment or decision for

the judgment or decision of a disciplinary

authority unless it comes to the conclusion

that it has shocked the conscience of the Court

or the punishment is such that no `reasonable

man' would impose such punishment or in the

words of Lord Scarman in Notinghamshire County

Council v. Secretary of State, 1986 AC 240 :

(1986) 1 All ER 199 that the decision is so

absurd that one is satisfied that the decision

maker at the time of making decision `must have

taken leave of his senses'.
2

34. In our considered opinion, the case

does not fall in any of the categories

enumerated by the Courts in several cases. We,

therefore, see no infirmity even in the final

decision taken by the Bank which deserves

interference by this Court.

35. For the foregoing reasons, the appeal

deserves to be dismissed and is dismissed,

however, without any order as to costs.

.............................................J.
(C.K. THAKKER)


New Delhi, .............................................J.
October 20, 2008. (D.K. JAIN)