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Judgment
Heard Mr. R. Mazumdar, the learned counsel for the petitioner and also heard Mr. K.K. Mahanta, the learned senior counsel assisted by Mr. K.
Singha for the respondents.
By filing this writ petition, the petitioner has challenged the Order dated 04.05.2015 by which he was terminated from service from the post of
Office Assistant under the respondent Bank. The petitioner has also challenged the decision of the Board of Governors taken in its 64th Meeting held
on 11.12.2015 by which the appeal preferred by the petitioner against his termination from service was rejected.
Brief facts of the case may be noticed at the outset. The petitioner was appointed on 01.08.1985 as Office Assistant under the establishment of the
respondent No. 1. The petitioner took an amount of Rs. 95,000/- from one Nibedita Gohain (respondent No. 5) through Bank Account in personal
relation for the purpose of marriage of his daughter scheduled to be solemnized on 05.02.2015 with a promise to return the amount after the marriage.
However, on 24.02.2015, the respondent No. 5 filed a complaint before the respondent No. 1 stating that the petitioner took the aforesaid amount with
a promise to give her a job under the respondent Institute. As a result of the complaint, the respondent No. 2 on 15.02.2015 issued a notice to the
petitioner asking him to give an explanation on or before 03.03.2015 about the complaint made against him by the respondent No. 5. The petitioner
submitted his reply on 03.03.2015 denying the allegations that he had taken the money with a promise to give a job to the respondent No. 5. He
explained that he was entrusted to inform all the trainees about the training of recovery agent scheduled to be held w.e.f. 17.11.2014. As such, the
petitioner informed all the trainees including the respondent No. 5 and gradually, the petitioner and the respondent No. 5 developed a relationship as a
family. When the petitioner discussed about the upcoming marriage of his daughter scheduled to be solemnized on 05.02.2015, the respondent No. 5
willingly agreed to provide financial assistance. Therefore, the petitioner took the aforesaid amount through his Bank Account and the respondent No.
5 also attended the marriage. During the training period, the respondent No. 5 was having financial hardship and the petitioner helped her. When the
examination results were declared, the respondent No. 5 failed in the examination. On coming to know the result, she came to Guwahati and
demanded that the petitioner should arrange for passing her in the exam, which however was refused by the petitioner. Thereupon, the respondent No.
5 filed the complaint against the petitioner.
The respondent No. 3 on 11.03.2015 framed charges against the petitioner charging the petitioner that he had borrowed money in his individual
capacity from a person who was not associated with the institution and also for trying to give unfair assistance by taking money. The petitioner filed
his reply on 23.03.2015 against the charge sheet denying the allegations whereafter, the appointed Inquiry Officer issued a notice on 25.03.2015 asking
the petitioner to appear before him on 27.03.2015. Thereafter, the Inquiry Officer submitted his Inquiry Report on 07.04.2015 by concluding that the
charges made against the petitioner was proved. The petitioner was then served with a copy of the Inquiry Report on 08.04.2015 and against the
Inquiry Report, the petitioner filed a representation before the respondent No. 3 on 20.04.2015 stating that he took the money from the respondent No.
5 in his personal capacity and not on official capacity and prayed for his exoneration. However, the respondent No. 2 vide Order dated 04.05.2015
removed the petitioner from service with immediate effect. Against his removal order, the petitioner filed an appeal before the Board of Governors of
the Institution stating that the act of borrowing money from personal friend did not amount to a breach of the Staff Rules and therefore, the impugned
order be set aside.
The further case of the petitioner is that on 30.06.2015, the respondent No. 5 lodged an FIR before the Director, Guwahati City Police stating that
the petitioner took an amount of Rs. 1,25,000/- from her. Since the amount was not returned back to her nor was she given a job and besides this,
misbehaved with her, she filed a complaint before the Basishtha Police Station on 13.03.2015. The Officer-in-charge of the Police Station called the
petitioner and to which the petitioner admitted to the accusation and he promised to return the money in two installments. The petitioner thereafter paid
an amount of Rs. 70,000/- but the remaining balance of Rs. 55,000/-having not been returned, the respondent No. 5 filed the aforesaid First
Information Report(FIR). The case was received and registered as Basishtha PS Case No. 806/2015 under Sections 406/420/354 IPC. The petitioner
was arrested during the investigation but he was subsequently released on bail.
As per the appeal filed by the petitioner before the Board of Governors, the petitioner was informed by the respondent No. 2 vide his
Communication dated 17.12.2015 that his appeal was considered in the 64th Meeting of the Board of Governors held on 11.12.2015 and after
deliberation, the penalty of removal from service imposed upon him was concurred. Thus, being aggrieved, the petitioner is before this Court.
Mr. R. Mazumdar, the learned counsel for the petitioner submits that the impugned order of removal from service was passed in gross violation of
the provision of the IIBM Staff Service Rules, 1985 (in short ‘Service Rules’). He submits that no proper inquiry was conducted so as to verify
the action taken against the petitioner. The learned counsel submits that as reasonable opportunity was not granted to the petitioner before the penalty
was imposed upon him, the provisions under Article 311 (2) of the Constitution of India has been given a go by. He therefore prays that Court may
interfere in the matter and pass appropriate order/orders.
Mr. K.K. Mahanta, the learned senior counsel appearing for the respondent Institution submits that the respondents have a preliminary objection on
the maintainability of the writ petition. He submits that the writ petitioner being an employee of the respondent Institution, the terms and conditions of
his service are governed by the IIBM Staff Service Rules, 1985 as revised from time to time. The terms and conditions having been accepted by the
petitioner, the writ petitioner is not entitled to seek any relief contrary to the terms and conditions of the Service Rules. The learned senior counsel
further submits that the IIBM is a Society registered under the Societies Registration Act, 1860 and therefore, it does not come under the purview of
the Article 12 of the Constitution of India and therefore, is not amenable under the writ jurisdiction of this Court i.e. Article 226 of the Constitution of
India. He further submits that the matter involves disputed question of facts and therefore, this Court may not examine the matter in exercise of its
writ jurisdiction. In support of his submission, the learned senior counsel relies upon the following authorities:-
1) Tekraj Vasandi @ K.L. Basandhi Vs. Union of India and Others, (1988) 1 SCC 236.
2) Federal Bank Limited Vs. Sagar Thomas and Others, (2003) 10 SCC 733.
3) Balmer Lawrie & Company Limited and Others Vs. Partha Sarathi Sen Roy and Others, 2013 (8) SCC 345.
4) Ramana Dayaram Shetty Vs. International Airport Authority of India and Others, (1979) 3 SCC 489.
5) Ajay Hasia and Others Vs. Khalid Mujib Sehravardi and Others, (1981) 1 SCC 722.
6) Pradeep Kumar Biswas Vs. Indian Institute of Chemical Biology and Others , (2002) 5 SCC 111.
7) Chander Mohan Khanna Vs. National Council of Educational Research and Training and Others, (1991) 4 SCC 578.
8) Zee Telefilms Ltd. and Another Vs. Union of India and Others, (2005) 4 SCC 649.
9) Lieutenant Governor of Delhi and Others Vs. V.K. Sodhi and Others, (2007) 15 SCC 136.
Mr. R. Mazumdar, the learned counsel for the petitioner by referring to the affidavit-in-reply filed by the petitioner on 21.04.2017 submits that the
respondent Bank is established and registered under the Societies Registration Act, 1860 and functioning as well as receiving aids from the Reserve
Bank of India and other Public Sector Bank and as such, the Institute falls under the “other authority†within the meaning of Article 12 of the
Constitution of India. He further submits that the aims and functions of the respondent Bank is that of an important arms of the Sponsor Banks to
realize the social and economic goals set for them by the Government in the North East Region. He submits that in fact vide Judgment and Order
dated 12.03.2015 passed in WP(C) No. 6277/2012, this Court was pleased to reject the objection raised by the respondent authority and held that the
Institute deals with public function and therefore, writ petition under Article 226 of the Constitution is maintainable. In support of his submission, the
learned counsel relies upon the following authorities:-
1) Board of Control for Cricket in India Vs. Cricket Association of Bihar and Others, (2015) 3 SCC 251.
2) Janet Jeyapaul Vs. SRM University and Others, (2015) 16 SCC 530.
Since the respondent Institution has raised the question of maintainability of the writ petition, as agreed to by the parties the same is taken up for
consideration before proceeding with the merit of the case. According to the respondent Institution, besides the petitioner being covered under the
Service Rules, the IIBM being a Society registered under the Society Registration Act, 1860, it does not fall under the provision of Article 12 of the
Constitution of India. Besides this, the issue involves disputed question of facts and therefore, the same cannot be examined under the writ jurisdiction
of this Court. A perusal of the Memorandum of Association of the IIBM would go to show that the Institution has been set up for the benefit of the
entire North Eastern Region and its activities includes the development, training and education of the personnel involved in the extension of banking
facilities. The objects of the Institution is to plan, promote and provide for education and training in operations of the Region and undertake, organize
and facilitate Conferences, Seminars, Study Courses, Lectures and similar other activities for the purpose. Besides this, the Institution has the object of
establishing and maintaining funds with the contributions/ donations from various sources, receipts by way of fees from organisations deputing
personnel to training programmes and with all other monies acquired by the Society in any other way. Management of the Institution is under the
control of the Governing Board who are representatives from different Banks and including the North Eastern Council. Under the rules of the
Societies, the General Body of the Society shall comprise of ordinary members and honorary members. The ordinary members shall consist of persons
who have signed the Memorandum of Association and the nominees of this Sponsor Banks. The Governing Board may admit and confer honorary
membership on any Indian or non-Indian eminent in public life and interested in the furtherance of the society and its objects but with the prior
approval of the Government of India. One third of the total membership of the General Body subject to a minimum of 10 members shall form a
quorum for a general meeting of the Society. The Chairman shall preside at all meetings of the Society and in his absence any member of the Board
appointed by the Chairman in writing shall preside the meeting. Every question shall be decided by the General Body by a majority of those present
and entitled to vote. Amongst the powers and functions of the Board, the Board is empowered to determine the duties and conduct, salaries and
allowances and other conditions of service of Officers and other employees of the Society. The establishment and maintenance of provident and other
funds for officers and other employees of the Society and besides this, the Board shall approve budget estimates for every financial year before the
end of preceding year for submission to the Sponsor Banks for application of funds. The Board is also empowered to determine the nature of courses
of study, training and research in banking and allied subjects. The Board also has the power to make, adopt, amend, alter or rescind the Bye laws as it
may find necessary for the management of the affairs of the Society. The Society also shall cause to be maintained such books of accounts and other
books in relation to its accounts in such form and in such manner as may in consultation with the Auditors of the society, be prescribed. The Annual
Accounts of the Society shall be audited by such body cited by auditor as the Board may appoint and a copy of the annual accounts of Society
together with the audit report and activities undertaken during the year shall be furnished to the ordinary members of the Society.
Let us now examine the authorities relied upon by the parties. The Apex Court in the case of Board of Control for Cricket in India (Supra) held
that Article 12 of the Constitution of India gives an inclusive definition of the expression ‘State’ and says that for the purpose of Part-III of the
Constitution, the expression ‘State’ includes Parliament of India, the Government and Legislature of each of the States and local or other
authorities within the territory of India or under the control of the Government of India. The Apex Court found that the BCCI thus discharged several
importance public functions which make it amenable to writ jurisdiction of the High Court under Article 226 of the Constitution of India.
The Apex Court in the case of Janet Jeyapaul (Supra) held that the respondent SRM University being engaged imparting education in higher
studies to students at large, it was discharging public function. Further, it was notified as Deemed University under the UGC Act and therefore the
provision under the UGC Act are applicable to the University. As such, it was held that the University was an authority within the meeting of Article
12 of the Constitution of India and amendable to the writ jurisdiction of the High Court. In coming to such conclusion, the Apex Court also took into
account the earlier decision rendered in Anti Mukta Satguru shree Mukta Ji vandas Swami Surarna Jayanti Mahotsal Smarat Trust Vs. V.R. Udani
reported in (1989) 2 SCC 691, wherein it was held that the term ‘authority’ used in Article 226 of the Constitution in the context, must receive a
liberal meaning unlike the term in Article 12. Article 12 is relevant only for the purpose of enforcement of fundamental right under Article 32. Article
226 confers power on the High Courts to issue writs for enforcement of the fundamental rights as well as non-fundamental rights. The words ‘any
person or authority’ used in Article 226 are therefore, not to be confined only to statutory authorities and instrumentality of the State. They may
confer any other person or body performs public duty. The form of body concerned is not very much relevant. What is relevant is the nature of the
duty imposed on the body. The duty must be judged in the light of positive obligation owned by the person or authority to the affected party. No matter
by what means the duty is imposed, if a positive obligation exists, mandamus cannot be denied.
The above principle was also the finding of the Apex Court in Federal Bank Limited (Supra), where it was held that a mandamus can be issued to
any person or authority performing public duty owing positive obligation to the affected party.
In the case of Ramana Dayaram Shetty (S), the Apex Court held that a Corporation may be created in one of two ways. It may be either
established by statute or incorporated under a law such as the Companies Act, 1956 or the Societies Registration Act, 1860. Where a corporation is
wholly controlled by the Government not only its policy-making but also in carrying out the functions entrusted to it by the law establishing it or by the
charter of its incorporation, there can be no doubt that it would be an instrumentality or agency of the Government.
In Chander Mohan Khanna (Supra), the Apex Court held that the object of the National Council of Educational Research and Training (NCERT)
is to assist and advise the Ministry of Education and Social Welfare in the implementation of the governmental policies and major programmes in the
field of education particularly School Education. The Government control is confined only to the proper utilization of the grant. The NCERT is thus
largely an autonomous body and therefore, does not satisfy the requirement of State under Article 12 of the Constitution. In Zee Telefilms Ltd. and
Another (Supra), the Apex Court while considering the test to see as to whether the authority would come under the purview of the definition of
‘State’ under Article 12 of the Constitution of India examined the concept of public function and public duty. The Apex Court held that public
law is a term of art with definite legal consequences. The concept of public law function is yet to be crystallised. The power of judicial review
however can be exercised by the Apex Court under Article 32 and by the High Courts under Article 226 of the Constitution of India only in a case
where the dispute involves a public law element as contradistinguished from a private law dispute. The general purview however is that whenever the
State or an instrumentality of the State is involved, it would be regarded as an issue within the meaning of public law. But where individuals are at
loggerheads, the remedy therefore has to be resorted to in private law field. Situation however changes with the advancement of the State function
particularly when it enters in the fields of commerce, industry and business as a result whereof either private bodies take up public functions and duties
or they are allowed to do so. The distinction has narrowed down but again concededly such a distinction still exists. Drawing inspiration from the
decisions of the Apex Court as also other Courts, it was held that when essential governmental functions are placed or allowed to be performed by a
private body, they must be held to have undertaken a public duty or public function.
From the above authorities and upon giving due consideration to the aims and objects, duties and functions of the Indian Institute of Bank
Management, this Court is of the considered view that the respondent Management may perhaps be not termed as ‘State’ or the
‘Authority’ as provided under Article 12 of the Constitution of India. But however, the words ‘any person or authority’ in Article 226 of
the Constitution of India as observed by the Apex Court in Janet Jeyapaul(Supra), V.R. Rudani (Supra) and Federal Bank Limited (Supra) is wide
enough and cannot be confined only to statutory authorities and instrumentalities of the state. They may cover any other person or body performing
public duty. The form of the body concerned is not very much relevant but what is relevant is the nature of the duty imposed upon the body. The duty
must be judged in the light of the positive obligation and if such positive obligation exists, mandamus cannot be denied. Therefore, I am of the
considered view that the writ petition against the respondent Institution is maintainable.
Now coming to the merit of the case, it is the case of the petitioner that due opportunity was not granted to him during the inquiry and therefore,
the impugned penalty is vitiated for non-following of and violation of Article 311 (2) of the Constitution of India. The petitioner also contends that the
livelihood of the petitioner cannot be taken away by a whimsical order and in violation of principles of natural justice, administrative fair play and good
conscience. The action of the respondent authorities is only hit by Articles 14, 16, 19 and 21 of the Constitution of India.
As may be noticed, the petitioner was given a show cause notice on 25.02.2015 by the respondent No. 2 asking him to submit an explanation on
the complaint submitted by the respondent No. 5 that he had taken a sum of Rs. 95,000/-by promising her to give a job under the respondent Institute.
The petitioner submitted his reply denying the charges. He however stated that he has taken the money as a loan because of his daughter’s
upcoming marriage on 05.02.2015 and that he would return the same after the marriage. However, the respondent authority not being satisfied with
the explanation issued a charge sheet against the petitioner on 11.03.2015 stating that the petitioner had breach/ violated the Service Rules particularly
Rule 31 (a) and Rule 31(k) (i). Accordingly, the charge sheet was issued to the petitioner under Rule 38 of the Service Rules. As per the charge
sheet, the petitioner was asked to answer the charge in writing or in person within a period of 7 days from the date of the charge sheet. Along with
the charge sheet, list of documents were enclosed which included the complaint submitted by the respondent No. 5, the pay slip by which the money
was deposited in the account of the petitioner etc. Since the petitioner did not respond to the charge sheet within the stipulated time, a reminder was
issued to him vide Communication dated 19.03.2015 granting him two more days to make his submission either written or oral. Thereafter, the
petitioner submitted his reply to the charge sheet on 23.03.2015 which in fact was beyond the stipulated time and the extended time granted to him. On
receiving the reply of the petitioner to the charge sheet, the disciplinary authority appointed an Inquiry Officer to inquire into the charges made out
against the petitioner and the said Inquiry Officer vide his communication dated 25.03.2015 informed the petitioner about his appointment by the
disciplinary authority and that inquiry would be conducted on 27.03.2015 at 2.30 pm. The petitioner was asked to attend inquiry in person and also to
bring his witnesses in his defence if any. The petitioner was further informed that if he wished to be assisted by any of the employees of the IIBM, he
may do so. It was further provided that if the petitioner failed to attend the hearing, the hearing of the inquiry would be conducted ex parte. During the
inquiry as can be seen from the Inquiry Report, the petitioner admitted to the charge that he had borrowed money in his individual capacity from a
person not having dealings with the Institute. As for the 2nd charge that the petitioner in performing his official duties acted otherwise than in the best
interest of the Institute by failing to bring to the notice of the authorities the alleged unfair assistance sought by the person from whom he had
borrowed the money. This charge was denied by the petitioner but the Inquiry Officer in view of the complaint submitted by the respondent No. 5 and
also in view of the failure on the part of the petitioner to report the pressure put on him by the respondent No. 5 had resulted in spoiling the image and
reputation of the Institute. Accordingly, the Inquiry Officer held both the charges to be proved. After the Inquiry Report was submitted in the above
manner, the petitioner was given an opportunity to submit his representation and accordingly, the petitioner submitted his representation on 20.04.2015.
In his representation, the petitioner stated that he regretted the entire matter of charge framed against him. He admitted the charges which was
committed in his personal capacity and beyond his official duties. Therefore, he was not guilty for the charges though the charges are said to have
been proved by the Inquiry Officer. Accordingly, he prayed that no disciplinary action be taken against him. He expressed regret about incident and
promised that he will not enter into such controversy in future. However, the representation of the petitioner was not accepted by the respondent
authority and accordingly, vide the impugned Order dated 04.05.2015, the petitioner was removed from service.
As per the charge sheet, the petitioner was charged to have violated Rule 31 (1) and 31 (k)(i) of the Service Rules. Rule 31 (a) provides that no
employee shall in the performance of his/her official duties or in the exercise of powers conferred on him/ her, act otherwise than in the best interest
of the Institute. Rule 31 (k)(i) further provides that no employee shall in his/ her individual capacity borrow money or permit any member of his/ her
family to borrow money or otherwise place himself/ herself or a member of his/ her family under a pecuniary obligation to a broker or a money lender
or a subordinate employee of the Institute or any person, association of persons, firm, company or institution, whether incorporated or not having
dealings with the Institute. Provided further that an employee may accept a loan subject to other provisions of these rules from a relative or personal
friend or operate and credit account with a bonafide tradesman.
From the above provision, it can be seen that the petitioner as per his own admission had borrowed the money from the respondent No. 5 and
therefore, Rule 31 (k)(i) is attracted. With the admission of borrowing money and in view of the provision of 31(k)(i), Rule 31 (a) will also be
attracted. The petitioner therefore, cannot say that money was borrowed in his personal capacity. Whether the respondent No. 5 had given him the
money for a return favour is therefore of less consequence.
In so far as the claim of the petitioner that adequate opportunity was not granted to him during the inquiry proceedings, I find no material on the
record which substantiate such averments. Rather the petitioner appears to have been given all the opportunity and nowhere has he mentioned as to
what sort of defence he would like to produce. In other words, the petitioner has not been able to show that any form of prejudice has been caused to
him. Thus, upon due consideration, I do not find any merit in the writ petition and accordingly, the same is dismissed. No cost.