Writ Petition No.7100 of 2000

15th July, 2004

Petitioner Counsel: Mr. S. V. PALSULEDESAI
Respondent Counsel: Mr. S. M. GORWADKAR

Cases Cited:
Federal Bank Ltd. Vs. Sagar Thomas, 2003(III) CLR 801 [Para 2,4]
Ram Sahan Rai Vs. Sachiv Samanava Prabandhak, (2001)3 SCC 323 [Para 3]
Sri Konaseema Co-operative Central Bank Ltd., Amalapuram Vs. N. Seetharama Raju, AIR 1990 Andhra Pradesh 171 [Para 3]
Uttar Pradesh State Co-operative Land Development Bank. Ltd. Vs. Chandra Bhan Dubey, 1999(1) L.L.N. 1081 [Para 3,4]

JUDGMENT

V. M. KANADE, J.:- By this Petition, petitioner seeks appropriate writ, direction or order under Article 226 of the Constitution of India quashing the order of termination dated 14/11/2000 passed by respondent No-1 - Bank and seeks further direction that the petitioner be reinstated in service with all consequential benefits.

2. Petitioner was appointed as a clerk in the year 1964 in the respondent No.1 - the Ratnagiri District Central Co-operative Bank Ltd. which is a Bank registered under the Maharashtra Co-operative Societies Act, 1960. Petitioner's case is that he was promoted and appointed as Manager of respondent No.1. Petitioner's case is that his services were terminated after holding an inquiry. Petitioner is challenging the said order of termination on various grounds. The learned Counsel appearing on behalf of the respondents, inter alia, submitted that a Writ Petition under Article 226 of the Constitution of India would not be maintainable against respondent No.1 which is a Bank registered under the Co-operative Societies Act. He relied upon the judgment of the Apex Court in the case of Federal Bank Ltd. Vs. Sagar Thomas & Ors. reported in 2003(III) CLR 801 wherein the Apex Court has held that private Bank cannot be classified in one polity in the category of discharging duties amounting to public nature.

3. The learned Counsel appearing on behalf of the petitioner relied upon the judgment of the Apex Court in the case of Ram Sahan Rai Vs. Sachiv Samanava Prabandhak and anr. reported in (2001)3 SCC 323. The Apex court in the said case, after examining the status of the District Co-operative bank, came to the conclusion that the State Government had all-pervasive control over the Bank and its employees which were governed by the statutory rules and, therefore, the Apex Court held that the defendant - Bank was an instrumentality of the State. The learned Counsel appearing on behalf of the petitioner further relied on the Full Bench decision of the Andhra Pradesh High Court in the case of Sri. Konaseema Co-operative Central Bank Ltd., Amalapuram and another Vs. N. Seetharama Raju reported in AIR 1990 Andhra Pradesh 171. In the said case, Full Bench of the Andhra Pradesh High Court held that if a particular co-operative Society can be characterized as a 'State' within the meaning of Art.12 of the Constitution (applying the test evolved by the Supreme Court in that behalf), it will be amenable to the writ jurisdiction of the High Court. It further held that even if a Society cannot be characterized as a 'State' within the meaning of Article 12, even so a writ would lie against it to enforce a statutory public duty which an employee is entitled to enforce against the Society. He further relied upon the judgment of the Apex Court in the case of Uttar Pradesh State Co-operative Land Development Bank. Ltd. Vs. Chandra Bhan Dubey and others, reported in 1999(1) L.L.N. 1081 wherein the Apex Court has held that the Uttar Pradesh State Co-operative Land Development Bank Ltd. is an instrumentality of State or an authority within the meaning of Article 12 and that the service conditions of its employees are statutory in nature.FINDINGS :

4. There cannot be any dispute regarding the ratio laid down by the Apex Court and the Andhra Pradesh High Court in the aforesaid judgments referred to by the learned Counsel appearing on behalf of the petitioner. However, the ratio of the said judgments will not be applicable to the facts of the present case. Respondent No.1 is a Bank registered under the provisions of the Maharashtra Co-operative Societies Act. The conditions of service of the employees of the said Bank are governed by its Bye-laws and rules. No attempt is made to indicate that the respondent No.1 - Bank is a State within the meaning of Article 12 of the Constitution of India. The Apex Court in the case of Federal Bank Ltd. (supra) held that the activities of the Bank cannot be classified as one falling in the category of discharging duties, functions of public nature. The Apex Court in para 41, page 816 of the said judgment has observed as under :-

"41. Such private companies would normally not be amenable to the writ jurisdiction under Article 226 of the Constitution. But in certain circumstances a writ may issue to such private bodies or persons as there may be statutes which need to be complied with by all concerned including the private companies. For example, there are certain legislations like the Industrial Disputes Act, the Minimum Wages Act, the Factories Act or for maintaining proper environment say Air (Prevention and Control of Pollution) Act, 1981 or Water (Prevention and Control of Pollution) Act, 1974 etc. or statutes of the like nature which fasten certain duties and responsibilities statutorily upon such private bodies which they are bound to comply with. If they violate such a statutory provision a writ would certainly be issued for compliance of those provisions. For instance, if a private employer dispenses with the service of its employee in violation of the provisions contained under the Industrial Disputes Act, in innumerable cases the High Court interfered and have issued the writ to the private bodies and the companies in that regard. But the difficulty in issuing a writ may arise where there may not be any non-compliance or violation of any statutory provision by the private body. In that event a writ may not be issued at all. Other remedies, as may be available, may have to be resorted to."

In para 43 of the said judgment, the Apex Court has further observed as under :-

"43. There are a number of such companies carrying on the profession of banking. There is nothing which can be said to be close to the governmental functions. It is an old profession in one form or the other carried on by individuals or by a group of them. Losses incurred in the business are theirs as well as the profits. Any business or commercial activity, may be banking, manufacturing units or related to any other kind of business generating resources, employment, production and resulting in circulation of money, are no doubt, such which do have impact on the economy of the country in general. But such activities cannot be classified one falling in the category of discharging duties, functions of public nature. Thus the case does not fall in the fifth category of cases enumerated in the case of Ajay Hasia (supra). Again we find that the activity which is carried on by the appellant is not one which may have been earlier carried on by the government and transferred to the appellant-company. For the sake of argument even if it may be assumed that one or the other test as provided in the case of Ajay Hasia (supra) may be attracted that by itself would not be sufficient to hold that it is an agency of the State or a company carrying on the functions of public nature. In this connection, observations made in the case of Pradeep Kumar Biswas (supra) quoted earlier would also be relevant."

The judgment relied upon by the petitioner in the case of Uttar Pradesh State Co-operative Land Development Bank Ltd. (supra) which is referred to by the Apex Court in para 44 of its judgment in the case of Federal Bank Ltd. (supra) has been distinguished. In the present case also, from the averments made in the petition, it cannot be said that the respondent No.1 - Bank is a State within the meaning of Article 12 of the Constitution of India. Therefore, writ under Article 226 of the Constitution of India cannot be issued for purpose of quashing the order of termination which has been issued pursuant to the disciplinary action which is taken against the employee by the respondent No.1 Bank. There is, therefore, no merit in the submissions made by the learned Counsel appearing on behalf of the petitioner. Writ Petition is dismissed on the ground that writ petition is not maintainable. Rule is discharged with no order as to costs. It will, however, be open for the petitioner to seek recourse to any alternative remedy which may be available to him before other competent forum.

Petition dismissed