U.P. COOPERATIVE FEDERATION LTD.versusRAM SINGH YADAV AND ORS.

A                    U.P. COOPERATIVE FEDERATION LTD.
                                            v.
                          RAM SINGH YADAV AND ORS.

                                 DECEMBER I, 1997

B             [SUJATA V. MANOHAR AND D.P. WADHWA, JJ.]


          Service Law :

            UP. Cooperative Societies Employees' Service Regulations, 1975 :
C    Regulations 19, 84 and 85. Termination or removal from service-Inference
    of-Employee's service terminated by Employer on ground that he absconded
    from 21. 7.1977-However, neither one month's notice or salary in lieu thereof
    given to employee as prescribed in Regulation 19-No departmental enquiry
     held-Employee did not work during the period from 21. 7.1977 to 3. 7.1989,
D    the date of High Court judgment-Held, Jn the absence of departmental
    enquiry, termination was in fact removal from service-Employee, therfore,
     entitled to be reinstated but it was open to the Employer to initiate disciplinary
    proceedings against him-However, employee not entitled to pay and
     allowances since he did not work during the period from 21.7.1977 to
     3.7.1989-U.P. Cooperative Societies Act, 1965, S. 122.
E
          Misconduct-Wilful absence-Disciplinary proceedings-initiation of-
    During pendency of appeal-Employee's services terminated by Employer on
    ground of wilful absence-High Court set aside termination-Employer
    appealed in Supreme Court against High Court's judgment-Employee again
    absented himself from duty during pendency of appeal-Held : It is always
F   open to the employer to initiate disciplinary proceedings against the employee
    for his remaining absent unauthorisedly or not joining duty during the
    pendericy of the appeal, if circumstances warrant.

          Misconduct-Wilfal absence-Employee contended that he did not join
    new posting on transfer on the ground that he was wrongly reverted from
G   Assistant to Chaukidar-Held : this was not a valid ground for not joining
    his new posting-Further, employee's claim for po'st of Assistant otherwise
    also not valid.

         The appellant-Federation terminated the services of the respondent
H   from 21-7-1997 on the ground of wilful absence in that he abandoned his
                                           622
                U.P. CO-OP.FEDERATION v. R.S. YADAV                        623
services. However, respondent was not given one month's notice or salary in A
lieu thereof as prescribed in Regulation 19 of the U.P. Cooperative Societies
Employees' Service Regulations, 1975. While in service the respondent was
transferred but be did not join his new posting because, according to him,
he was wrongly reverted from Assistant to Chaukidar. On appeal the High
Court set aside the order of termination on the ground that no disciplinary B
proceedings were initiated against the respondent and his service could not
have been terminated without there being an enquiry officer appointed and
no enquiry ever having been conducted against the respondent on the alleged
ground of his abandoning his job. Being aggrieved the appellant-Federation
preferred the present appeal. During the pendency of this appeal the
respondent again absented himself from duty. The respondent also had not C
worked from 21-7-1977 to the date of the High Court judgment i.e.,
3-7-1989.
      Partly allowing the appeal, the Court
       HELD : 1. The impugned order of termination of service of the
respondent is in fact removal of the respondent from the service since             D
procedure prescribed in Regulation 19,84 and 85 of the U.P. Cooperative
Societies Employees' Service Regulations, 1975 have not been met. There
is no charge sheet, no enquiry officer and no enquiry proceedings. Therefore,
the respondent is entitled to be reinstated though it does not precl.ude the
appellant form holding an enquiry or passing proper order in accordance            E
with law. However, since the respondent has not worked from 21-7-1977 till
the impugned judgment dated 3-7-1989 of the High Court the respondent
would not be entitled to pay and allowances for that period. This is so as the
respondent is at fault in not joining his new posting without any valid reason.
    .                                                     [632-G-H; 633-A-B)
                                                                                   F
      2. Admittedly, during the pendency of the appeal the respondent again
absented himself from duty. The appellant chose not to take action against
the respondent because of the pendency of this appeal. It is always open to
the appellant to initiate disciplinary proceedings against the respondent for
his remaining absent unauthorisedly or not joining duty during the pendency
of this appeal, if circumstances so warrant. (632-D)                               G
      3. For not joining the duty the respondent appears to take shelter on
his plea that he could not have been reverted from the post of Assistant and
be would not join the new posting as Chaukidar. Letter terminating the
service describes the respondent as Chaukidar. It is difficult to understand
the plea raised by the respondent that he was entitled to the post of Assistant,   H
    624                      SUPREME COURT REPORTS [1997] SUPP. 5 S.C.R.

A   or that he was justified in not joining his new posting unless he was given
    posting as Assistant. His not joining the posting on that account does not
    appear to be based on any of his legal rights under the Regulations. Moreover,
    there is no order by the competent authority by which it could be said the
    respondent was promoted as Assistant. 1631-F]

B           CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3052 of
    1992.

         From the Judgment and Order dated 3.7.89 of the Allahabad High Court
    in W.P.No. 161 I of 1978.

C        Mrs. Rani Chhabra Ms. Rachna Srivastava and Ms. Richi Goyal for the
    Appellant.
         Mrs. M. Qamaruddin J.A. Warsi and Shahid Hussain for the
    Respondents.
            The Judgment of the Court was delivered by
D         D.P. W ADHW A, J. This appeal is directed against the judgment dated
    July 3, 1989 of the Division Bench of the High Court of Judicature at Allahabad
    (Lucknow Bench) allowing the writ petition of the respondent. The respondent
    who was an employee with the appellant challenged the order dated May 25,
    1978 of the Joint Managing Director of the appellant terminating his services
E   on the ground that he abandoned his services from July 2 I, 1977 and that the
    respondent would not be entitled to any pay and allowances. The order
    terminating the services of the respondent, however, says that "as such he
    is absent since 21 July, 1977, and his services are terminated for the reason
    of being absconded in this way." By the impugned judgment, the High Court
    set aside the order dated May 25, I 978 on the ground that no disciplinary
F   proceedings were initiated against the respondent and his services could not
    have been terminated without there being an enquiry officer appointed and
    no enquiry ever having been conducted against the respondent on the alleged
    ground of his abandoning his job.

            The appellant is a co-operative society registered under the U.P. Co-
G operative Societies Act, 1965 (for short 'the Act'). It is, therefore, governed
    by the provisions of that Act and the Rules framed thereunder. Section I 22
    of the Act prescribes constitution of an Authority to control employees of
    co-operative societies. This section we may reproduce as under :

             "122. Authority to control employees of co-operative societies:- (I)
H            The State Government may constitute an authority or authorities, in
     U.P. CO-OP.FEDERATION v. R.S. Y ADAV [D.P. WADHWA, J.]                625.

        such manner as may be prescribed, for the recruitment, training and        A
        disciplinary control of the employees of co-operative societies, or a
        class of co-operative societies, and may require such authority· or
        authorities to frame Regulations regarding recruitment, emoluments,
        terms and conditions of service including disciplinary control of such
        employees and subject to the provisions contained in Section 70,           B
        settlement of disputes between an employee of a co-operative society
        and the society.

        (2) The Regulations framed under sub-section (I) shall be subject to
        the approval of the State Government and shall, after such approval,
        be published in the Gazette, and take effect from the date of such         C
        publication and shall supersede any Regulations made under Section
        121.

      The State Government framed the U.P. Co-operative Societies Employees'
Service Regulations, 1975 which were published in the U.P. Gazette dated 6th
January, 1976. The Regulations were applicable with effect from the date of        D
their publication in the U.P. Gazette. Clause (xi) of Regulation 2 defines
'employee' which means a person in whole-time service of a co-operative
society, but does not include a casual worker employed on daily wages or a
person in part-time service of a society. Under Regulation 5 recruitment for
all appointments in a co-operative society shall be made through the Board
which means the U.P. Co-operative Institutional Service Board. The constitution    E
and the functions for this Board may, however, be not relevant at this stage
as the respondent was appointed on January 22, 1973 as a Helper, a Class IV
employee, temporarily by the Secretary of the appellant, viz., prior to the
coming into force of the Regulations. Under Regulation I 02 a co-operative
society is empowered to frame service rules for its employees which, however,      F
are to be subject to the provisions of the Regulation. The Regulations,
however, apply to the existing employees of a co-operative society which
were on its roll on the date the Regulations took effect. Under Regulation I 03,
the Regulations shall be deemed inoperative to the extent they are inconsistent
with any of the provision of the Industrial Disputes Act, 1947, U.P. Dookan
Aur Vanijay Adhisthan Adhiniyam, 1963, Workman's compensation Act, 1923            G
and any other labour laws for the time being in force. Regulations I 02 and
I 03 may be set out as under :

        "102. (I) Subject to the provisions of these regulations, a co-operative
        society shall within three months from the date of coming into force
        of these regulations (unless an extension of time is allowed by the        H
    626                    SUPREME COURT REPORTS [1997] SUPP. 5 S.C.R.

A         Board in writing) frame service rules for its employees.

          (I l)The service rules framed under sub-section (i) shall be submitted
          to the Board for approval and shall be operative only after the approval.

          (iii) Notwithstanding, anything contained in these Regulations the
          existing employees shall have an option to continue to be governed
B         by the existing service rules, if any, in the society only in respect of
          their emoluments and benefits or to opt the new service rules on these
          matters.

          Explanations-( 1) Provisions relating to pay, increments and
          allowances (other then travelling allowance), probation, confirmation,
c         retirement, provident found, and gratuity, shall be deemed as included
          in the term "emoluments and benefits".

          (2) In case of any doubt or dispute in interpretation in respect of the
          matter mentioned (1) above, reference shall be made to the Board
          whose decision shall be final.
D
          (3) Existing service rules means authentic service rules framed by and
          with the approval of the competent authority.

          103. The provisions of these regulations to the extent of their
          inconsistency, with any of the provisions of the Industrial Disputes
E         Act, 1947, U.P. Dookan Aur Vanijay Adhisthan Adhiniyam, 1962,
          Workman's Compensation Act, 1923 and any other labour laws for the
          time being in force, if applicable to any co-operative society or class
          of co-operative societies, shall be deemed to be inoperative".
          Regulation 19 provides for termination of services of an employee.
          This Regulation, in relevant part, is as under :
F
          "19. Termination-Service of an employee shall be terminable :-

          (a) in case of a temporary employee, on one month's notice in writing
          on either side, or in lieu thereof by payment of one month's salary by
          the party which gives notice:
G         Provided that in case of direct appointment made for a specific period,
          it shall not be necessary to give any notice or any pay in lieu thereof.

          Explanation.- 'Specific period' means stated period of less then six
          months.

H         (b) by three months' notice in writing on either side in case of a
    U.P. CO-OP. FEDER:A TION v. R.S. YADAY (D.P. WADHWA, J.]              627
        confinned employee.                                                       A
        Explanation. (1) A notice given by an employee under Regulation
       No. 19 shall be deemed to be proper only ifhe remains on duty during
       the period of the notice :

        Provided that the employee may be allcwed on request to avail such        B
        portion of earned leave as may be due to him which shall however not
        exceed the notice period."

      Under Regulation 33, the salary accruing to an employee ceases when
the employee ceases to be in the service of the co-operative society. Jn case
of an employee who is dismissed or removed from service or dies while in the      C
service of the co-operative society the salary shall cease from the date of his
dismissal, removal or death, as the case may be. Chapter VII of the Regulations
contains provisions for penalties, disciplinary proceedings and appeals. Under
Regulation 84, an employee can be removed from service and he is to be
provided with the copy of the order of punishment. The penalty of removal         D
from service cannot be imposed without recourse to disciplinary proceedings.
An employee cannot be removed or dismissed by an authority other then by
which he was appointed unless the appointing authority has made prior
delegation of such authority to such other person or authority in writing.
Regulation 85 provides in detail as to how disciplinary proceedings are to be
conducted. Any order of removal or dismissal from the service or reduction        E
in rank or grade held substantively by the employee cannot be passed except
with the prior concurrence of the Board (Regulation 87). The order imposing
penalty is also appealable under the Regulations.

      Our attention has been draw to the Service Rules of the appellant which
are stated to be in force from July I, 1956 and particularly to Rules 17 and      F
18 thereof which are reproduced as under:

       "17. If any employee behaves carelessly and commits irregularities or
       his actions are prejudicial to the interest of the Federation an enquiry
       may be instituted. The employee will be called upon to explain the         G
       charges that may be framed against him. He will be required to submit
       his explanation to the enquiring officer to be deputed by the secretary.
       Such an employee will also be given opportunity to be heard in
       person if he is so desires. If no explanation is received or the
       explanations submitted is unsatisfactory, the punishment that is
       proposed to be given to him will be communicated to him, and he will       H
    628                     SUPREME COURT REPORTS [1997] SUPP. 5 S.C.R.

A          be required to show cause why the proposed punishment may no.t be
           given to him. If no further explanation is received or the explanation
           is unsatisfactory, the Executive Committee or Secretary as the case
           may be, will award the punishment to him ifthe Executive Committee
           or the Secretary is satisfied that the punishment is deserved.

B          18. Notwithstanding anything contained in Rule 17, if any employee
           is guilty of any misconduct as defined herein he shall be liable to be
           dismissed without notice or any compensation in lieu of notice. The
           following acts and omissions shall be treated as misconduct:

            (a)   Wilful insubordination or disobedience, whether alone or in
C                 combination with others, to any lawful and reasonable order
                  issued or authorised by the authorities

            (b)   Theft, fraud, or dishonesty in connection with the business or
                  property of P.C.F.
            (c)   Wilful damage to or loss of goods or property of P.C.F.
D
            (d) Taking bribes or any illegal gratification.

            (e)   Habitual absence without leave, or absence without leave, for
                  more then 15 days in one stretch.
            (f)   While absent from duty with or without leave, failure without
E                 sufficient cause to rejoin duties within a reasonable time when
                  specifically called upon to do so by a competent authority.
            (g) Habitual breach of any law or rule applicable to P.C.F.

            (h)   Riotous or disorderly behaviour during working hours, or any
                  behaviour subversive of disciplines.
F
          In awarding punishment under this Rules the gravity of the misconduct,
    the previous record of the employees, and any other extenuating or aggravating
    circumstances that may exist shall be taken in to account."
                                                                                     ....
G          It will be thus seen that under Rule 18, an employees is guitly of
    misconduct if he is absent from duty with or without leave or he failed,
    without sufficient cause, to rejoin duties within a reasonable time when
    specifically called upon to do so by a competent authority. In such a case
    the employee is liable to be dismissed without notice or any compensation
    in lieu of notice. Indeed, in awarding punishment under Rule 18, the gravity
H   of misconduct, the previous record of the employee or any other extenuating
    U.P. CO-OP. FEDERATION v. R.S. YADAV [D.P. WADHWA, J.]                629

or aggravating circumstances that may exist shall be taken into account. If we    A
rely on this submission of the appellant that in the present case action has
been taken under Rule 18, it would appear to us that the respondent has not
been removed from service or his services have not been terminated but he
has been dismissed. In that case it will be clearly in violation of Regulation
84.lt is not necessary for us to examine all the Service Rules of the appellant   B
but Rules 17 and 18 cannot stand in face of Regulations 84 and 85 and in view
of Regulation I 02. That, therefore, does not appear to be a correct submission
in the circumstances of the case.

      As noticed above, the respondent was employed as Helper, a class-IV
post, by the Secretary of the appellant on a consolidated salary of Rs.125/ C
-per month on temporary basis and his services were terminated on May 25,
1978. During the period of his employment which was initially at Sitapur, the
respondent was transferred to Unnao, Gorakhpur and then finally to Lucknow
as and when the need arose on completion of any particular project which
was being handled by the appellant. On November I, 1975, an order was D
issued by the Secretary of the appellant to the District Superintendent of the
appellant to absorb services of Mates including that of the respondent who
were working under A.R.C. in the cloth scheme which had been completed.
It was mentioned in the order that if any Mate was. found unsuitable, the
Secretary should be informed and further that if in any district some people E
had been appointed on daily wages then those appointment should be
cancelled and the services of Mates should be used. It was also mentioned
that the appointment should, however, be totally temporary and could be
terminated any time without any notice. From November 1,1976, the respondent
was given a regular scale of pay in the pay-scale of Rs.165-215. It appears
from the record, however, that there were persistent complaints against the F
respondent about his working. He was accused of inefficiency, indiscipline
and even insubordination. So much even a memo was issued to him but no
action was taken against the respondent. He was, however, transferred from
one office to another of the appellant but all at Lucknow. Lastly the respondent
was transferred form PCF Lucknow to PCF Press. This was by order dated G
July 14, 1977. By this order three employees were transferred and the order
reads as under:

        "The following assistants/Chaukidar are transferred at places written
        against their names. They after being relieved from their place of work
        may assume their work at New Place with immediate effect.                 H
    630                      SUPREME COURT REPORTS (1997] SUPP. 5 S.C.R.

A Si.        Name of the            Present place           New place
    No.      employee Mis             ~f work                of work
    I.      Sh.Ram Singh            PCF Lucknow              PCF Press
          Yadav

B 2.        Rahim Bun               PCF Lucknow             PCF Press

    3.      Vishun Kumar            PCF Lucknow             Head office
                                                                Sd/-N.P. Aggarwal
                                                                         Secretary

c          Office U.P.Co-operative Federation Limited 6, Camper Road, Lucknow.

           Sd/- PCF/1/674/85 dated July14, 1977

          · Copy to the following for information and necessary action.

D          I. Concerned Employee

          2. Dist. Superintendent PCF Lucknow

          3. Superintendent Coal Dump, Lucknow

          4. Regional Officer, Lucknow
E         5. Deputy Managing Director/ Account/ Press

          6. The Accounts Officer (General)

          7. Pay Bill Assistant

          8. Superintendent (Nazarat)
F
           Respondent admits that he so transferred and also the fact that he did
    not join new posting. While the appellant complains that the respondent
    abandoned his work and did not report for duty when transferred on May
    30, 1977 to Regional office at Lucknow and then ultimately to PCF Press on
G   July 14,1977, the respondent says that no order was served upon him when
    he was transferred to Regional Office on May 30, 1977. He nevertheless
    admits his transfer to PCF Press his non joining there. But his case is that
    when he was transferred on May 30, 1977 he was reverted from the post of
    assistant, on which he was officiating, to that of Chaukidar. His grievance is
    that though he qualified interrned.iate Science Examination and was entitled to
H   be considered for appointment to the post of assistant in the appellant as and
        U.P. CO-OP.FEDERATION v. R.S. YADAV [D.P. WADHWA, J.]                631

  when vacancies for such posts arose out he was not so considered in               A
  violation of regulation 27. Under this Regulation out of the total vacancies
  to be provided for, 50 per cent shall, as far as possible, be filled up by
  promotion from amongst the eligible employees and further promotion to
  higher posts shall be made on the basis of seniority-cum-merit. Respondent
  has also based his claim on two communications where he was described as
  assistant. One such communication is dated March 23, 1976 by the District         B
  Superintendent PCF where he was been addressed as "Sri Ram Singh Yadav
  (Assistant) PCF Lucknow" and ordering him to keep entire record pertaining
  to wheat purchases for planning year 1976-77 and conducting necessary
  proceedings in respect thereof. The other such communication also by the
  Distt. Superintendent, PCF, Lucknow is dated April 6, 1976. This communication    C
  is addressed to as many as five employees and the respondent is described
. as Assistant and detail of his work is "to help Ram in wheat delivery". This
  communication dated April 6, 1976 is an order which starts as under:

         "Under planing for purchasing of wheat in Rabi, year 1976, the
         employees in District Office are posted in duty accordingly. This work     D
         will be additional to their regular job and job of purchasing the wheat
         will be done in priority."

         There is, however, no order by the competent authority by which it
 could be said the respondent was promoted as Assistant. As a matter of fact        E
 it is the case of the respondent himself that he was wrongly reverted and he
 also complains that he was wrongly ignored for promotion to the post of
 Assistant which promotion was denied to him. For not joining the duty the
 respondent appears to take shelter on his plea that he could not h'ave been
 reverted from the post of Assistant and he would not join the new posting
 as Chaukidar. Letter terminating the services describes the respondents as         F
 Chaukidar. It is difficult to understand the plea raised by the respondent that
 he was entitled to the post of Assistant or he was justified in not joining his
 new posting unless he was given posting as Assistant. His not joining the
 posting on that account does not appear to be based on any his legal rights
 under the Regulations.
                                                                                    G
        When leave was granted on special leave petition filed by the appellant
 in this case, on the interim application it was ordered that there would be stay
 of payment of back wages to the respondent until further orders. Record of
 this appeal shows that there has been controversy again if after the impugned
 judgment of the High Court the respondent ever joined his service. On the          H
    632                      SUPREME COURT REPORTS [1997] SUPP. 5 S.C.R.

A   other hand, it was stated by the appellant that the respondent had moved the
    High Court for taking contempt proceedings against the officer of the appellant
    for not allowing him to join the duty. This Court recorded that the respondent
    it seemed was not reporting for duty whereas on the other hand he took out
    contempt proceedings in the High Court. The Court noted that the registered
B   letters dated 2.3.90 and 25.9.90 were sent to the respondent to join duty but
    he did not appear to have responded to the same and instead to put pressure
    he had taken out contempt proceeding in the High Court. This Court expressed
    unhappiness about the manner in which the respondent was proceeding with
    the matter. It was directed that in order to give a last chance to the respondent
    he should report for duty latest by 15th January, 1994, failing which, the Court
C   would be constrained to infer that he was not interested in the job. The matter
    did not end there. The appellant again approached this Court complaining
    that though in pursuance of earlier order the respondent did join the duty but
    he again absented. Be that as it may, we are not concerned with the conduct
    of the respondent or any action which the appellant could take against him
D   for his alleged misconduct during the pendency of this appeal. It would,
    however, appear that because of the pendency of this appeal the appellant
    chose not to take any action against the respondent. It is always open to the
    appellant to initiate disciplinary proceedings against the respondent for his
    remaining absent unauthorisedly or not joining duty during the pendency of
    this appeal if circumstances so warrant.
E
           It could not be denied that the respondent is an employee within the
    meaning of clause (xi) of Regulation 2 of the Regulations. He is in the whole-
    time service of the appellant. He is not a casual worker employed on daily
    wages or a person in part-time service of the appellant. It is not material for
    us to examine therefore if the respondent is temporary or has been substantively
F   appointed to the post he is holding. The impugned order in is fact an order
    of removal of the respondent from service. It is not a termination in the strict
    sense within the meaning of Regulation 19 as the requirements of that
    Regulation have not been met and that is also not the case of the appellant
    that the action was under Regulation 19. That being so the impugned order
G   of termination is in fact removal of the respondent from the service and
    procedure as prescribed in Regulation 84 and 85 had therefore to be met. That
    has admittedly not been done. There is no chargesheet, no enquiry officer
    and no enquiry proceeding. Regulation prescribe detail procedure for conduct
    of the disciplinary proceedings. Provisions of Regulations 84 and 85 have
    certainly been violated to the prejudice of the respondent. We therefore
H   uphold the order of the High Court setting aside the termination of service
"

             U.P. CO-OP. FED ERA HON v. R.S. YAO AV [D.P. WAOHWA. J.]        633
    of the respondent by order dated May 25, 1978 to the extent that the respondent A
    has to be reinstated in the service though it does not preclude the appellant
    from holding an enquiry or passing proper order in accordance with law.
    However, since on the admission of the respondent himself that he has not
    worked from July 21, 1977 till the impugned judgment dated July 3, 1989 of
    the High Court the respondent would not be entitled to any pay and allowances
    for that period. This is so as respondent is at fault in not joining his new B
    posting without any valid reason. Though ultimately if there is no enquiry or
    the respondent is exonerated this period shall be counted towards his
    pensionary and other benefits.

          The appeal is thus partly allowed to .the extent mentioned above. There   C
    will, however, be no order as to costs.

    v.s.s.                                                      Appeal allowed.




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