Dharam Pal vs The State of Haryana and another

D.V. Sehgal, J.—Dharam Pal Petitioner is practising as an Advocate at Kaithal, District Kurukshetra. He is an elected Sarpanch of village Chhot. He is also a member of the Block Samiti, Kaithal. He is a Director of the Kaithal Co-operative Marketing-cum Processing Society Limited, Kaithal. He was also elected to the office of Director, Kurukshetra Central Co-operative Bank Limited, Kurukshetra. In this capacity, he sought election to the office of Director, Haryana Co-operative Bank Limited, Chandigarh (hereinafter referred to as the Bank'') and was duly elected to the said office. He claims that, since his election as director of the Bank, he has been taking keen interest in the development of the co-operative movement

On 7-11-1985 he was staying in the Guest House of the bank, located in House No. 713, Sector 8, Chandigarh. Jaibir Singh Verma, member of the Haryana Subordinate Services Selection Board, was also staying there. He states that the Directors of the Bank had been feeling inconvenience during their stay in the Guest House of the Bank at Chandigarh as it mostly remained occupied by persons not entitled to occupy the same He objected to the stay of Mr Jaibir Singh Verma who took it ill and there was some unpleasentness between them at night on 11-7-1985. Shri Verma is stated to have reported the matter to the Managing Director of the bank who, in turn, recommended to the Registrar, Co operative Societies Respondent No. 2, that action should be taken against the Petitioner u/s 34 of the Haryana Co-operative Societies Act, 1984 (hereinafter referred to as the ''Act'') Respondent No. 2, vide an order dated 7-8-1985, in the purported exercise of power under Sub-section (2) of Section 35 of the Act. suspended the Petitioner from the membership of the Committee of the Bank and also served him with a notice to show cause as to why he should not be removed from the membership of the Committee of the Bank u/s 35(1) of the Act. He submitted his reply to show cause notice but no action on the same was taken for quite some time. He, therefore, filed Civil Writ Petition No. 4398 of 1985 in this Court, challenging the order of his suspension and the show cause notice served on him for his removal from the membership of the Committee of the Bank. The aforesaid writ petition came up for mention hearing before the Division Bench after notice to the Respondents after hearing the learned Counsel for the parties, a direction was issued to Respondent No. 2 to complete the enquiry in pursuance of the show cause notice and pass an appropriate order by 5-12-1985. After receiving evidence and hearing arguments of the parties, Respondent No. 2 passed the impugned order dated 4-12-1985 (Annexure P 1) directing removal of the Petitioner from the membership of Managing Committee of the Bank. The Petitioner challenged the aforsaid order by filing Civil Writ Petition No 5825 of 1985. It came up for motion hearing on 25-2-1986. After hearing the learned Counsel for the parties, the Division Bench passed the following orders:

It is not disputed that an appeal lies against the impugned order consequently, we direct the Petitioner to file an appeal against the impugned order within a fortnight from today. If such an appeal is filed within the aforesaid time; as stated by Mr. Bish-noi, the learned Counsel for the State, the same shall disposed of on merits by the competent authority within two months of the receipt of the appeal and objection with regard to limitation shall not be entertained. In case the appeal is not filed within a fortnight, then the same shall not be entertained. With these observations, the petition stands disposed of

In pursuance of the above order of the Division Bench of this Court, the Petitioner filed an appeal u/s 114 of the Act against the order of Respondent (Annexure P-1) before the Commissioner-cum Secretary to Government, Haryana Co-operative Department, vide memorandum of appeal Annexure P.2. The same has however, been dismissed by the said Appellate Authority, vide order dated 2-5-1986 (Annexure P-3). The Petitioner has, therefore filed the present writ-petition against the impugned orders, Annexure P-1 and P-3, with a prayer that the same are ultra vires the provisions of Section 35(1) of the Act and are violative of the principles of natural justice.

The petition has been opposed by the Respondent and a written statement on their behalf has been filed by the Addl Registrar (Credit), Co operative Societies of Haryana. It has been asserted than the impugned orders have been passed in pursuance of the power vested by the Act and that the Petitioner was afforded reasonable opportunity to explain his position. The impugned orders were passed after due enquiry and consideration of the reply filed by the Petitioner.

I have heard the learned Counsel for the parties. The first contention raised by the learned Counsel for the Petitioner is that the impugned orders are ultra vires the provisions of Section 35(1) of the Act. Here, it is necessary to reproduce the said provision:

35 (1) If in the opinion of the Registrar, any member of the Committee persistently makes default or is negligent in the performance of the duties imposed on him by this Act or rules or bye-laws commits any act which is prejudicial to the interest of the society or its members, the Registrar may after giving the member an opportunity to state his objections, if any, by order in writing, remove the member and get the vacancy filled up for the remaining period of the outgoing member, according to the provisions of the Act, rules and bye-laws.

Respondent No. 2 has held that the Petitioner had committed an act which is prejudicial to the interest of the Society. He has referred to the bye-laws of the Bank and the objects of the Society which, inter alia, are to the following effect:-(1) to (6)........ (7) to undertake such other activities are incidental to the attainment of the objects

He has observed that the interest of an institution does not consist only of its financial position and business transactions but also includes good will and good reputation. The occurrence of the incident which the Petitioner was alleged to be involved in the Guest House was considered as one spoiling the reputation of the Bank, especially when it emanated from an office bearer of the Bank i. e., the Petitioner as its Director. It was further opined that a person, who is connected with an institution, is supposed to conduct himself in such a way as does not bring bad name to it.

Learned Counsel for the Petitioner has, however, contended that the altercation between the Petitioner and Jaibir Singh Verma was in nature of a private dispute which was, in no way, related to any activity or even an incidental activity aimed at attaining any of the objects of the Bank. The Petitioner, therefore, could not be said to have committed any act which is prejudicial to the interest of the Bank. His removal, therefore, could not be ordered by Respondent No. 2 u/s 35(1) ibid.

I have considered the rival contentions of the parties on this aspect. If the incident of an ugly nature was described by Shri Verma in his letter addressed to the Managing Director of the Bank to which a defined reference shall be presently made, had taken place and the Petitioner was resposible for the same, I have no doubt in my mind that it was bound to affect the good will of the Bank and a misconduct of this nature on the part of the Petitioner would faill within the ambit of Section 35(1) ibid and Respondent No 2 was empowered to remove him from the membership of the Managing Committee of the Bank on that account. I find support for this view from Bhagat Ram Patanga Vs. The State of Punjab, ., wherein it has been observed:-

I cannot be said that it is only when a person abuses his position as a member of the Committee and shows favour to others or gains undue advantage to him that he can be considered to have flagrantly abused his position as a member of the Committee A position is said to be abused when it is put to a bad use or for wrong purpose. It may no doubt vary with the circumstances Where a person who, as a member of the Committee, is entitled to be present at the time of the meeting of the members of the Committee brings in rowdies for creating disturbance so that the Committee meeting may not be held peacefully and properly, he can be considered to have flagrantly abused in his position as a member of the Committee while participating in the meeting of the Committee. Hence, the government would be justified in coming to the conclusion that action has to be taken against that member u/s 16(l)(e).

lo Bhagat Ram Patanga''s case (supra), the Petitioner was a member of the Municipal Committee and he was held guilty of misconduct within the meaning of section 16(l)(e) of the Punjab Municipal Act, 1911, which, inter alia, provides as under:-

(1) The State Government may, by notification, remove any member of the Committee:-

(e) if, in the opinion of the State Government, he has flagrantly abused his position as a member of the Committee or has through negligence or misconduct been responsible for the loss, or misapplication of any money or property of the Committee.

I have no doubt in my mind that if the misconduct alleged against the Petitioner is proved, then he misused his position as a Director of the Bank and committed an act prejudicial to its interest

The next contention raised by the learned Counsel for the Petitioner is that the allegations against him were not proved. The finding that has been returned is not based on any evidence. In fact, the Petitioner was not afforded opportunity to defend himself in accordance with law and full material was not disclosed to him On my direction, learned Counsel for the Respondents placed before me the relevant file of enquiry against the Petitioner. Shri Jaibir Singh Verma, in his D O letter dated 12-7-1985 translation of which is enclosed as annexure R-l, addressed to the Managing Director of the Bank, had, inter-alia, made the following allegations:-

On 11-(sic)-1985 as a member of the Haryana Subordinate Services Selection Board had stayed in room No 4 of the Rest House of the Haryana State Co-operative Bank Ltd, Chandigarh, situated in Kothi No. 713, Sector 8, Chandigarh. My sister, sister''s husband and one or more relative were also staying there. At about 12.30 at night, one person, namely, Shri Dharam Pal (who was saying himself as Director of the HARCO BANK) along with three other persons under the influence of liquor entered into my room without my permission. These persons misbehaved, abused and threatened us to take our life. They did not spare even my sister who was sleeping on the roof along with her husband 1 hey also misbehaved with my sister by insulting her.

The show-cause notice dated 7-8-1985, which was issued by Respondent No. 2 to the Petitioner, contains the following allegations:-

It has been reported that Shri Jaibir Singh Verma, member, Haryana Subordinate Services Selection Board, was staying in the Rest House of the Haryana State Co-operative Bank Limited (hereinafter called the Bank) (Kothi No. 713, Sector 8. Chandigarh), on 11-7-1985, along with his relatives. On that day, i e., 11.7.1985, you were also staying in the aforesaid Rest House along with three other persons. You, under the influence of liquor, misbehaved with Shri Verma and his relatives. This act of yours is unbecoming of a Director of the Bank and is considered to be prejudicial to the interest of the Bank

The allegations were denied by the Petitioner through a reply to the show-cause notice, which was submitted to Respondent No. 1 Admittedly, a copy of letter dated 12-7-1985 from Shri Jaibir Singh Verma, which was the basis of issuance of the show-cause notice, was not supplied to the Petitioner along with the same. Respondent No. 2 required the parties, vide order dated 29-11-1985, to produce their evidence before him on 2-12-1985. On that day, Shri R. C. Tandon, ex-Managing Director of the Bank (PW 1) and Khiali Ram Tiwari, peon in the Guest House of the Bank as (PW 2) were produced in support of the allegations contained in the show-cause notice Shri Jaibir Singh Verma was not produced as a witness and, in fact, a statement was made on behalf of the Bank that Shri verma could not be contacted as he was away in connection with the marriage of bis daughter at Hissar on 6-12-1985. It was not possible even to produce him on 5.12.1985 to which date the case was sought to be adjourned. Therefore, the evidence on behalf of the Bank was closed by its representative. Shri R. C. Tandon PW 1 was not a witness to the incident and his statement is, therefore, not of much consequence. Khali Ram Tiwari PW 2 gives only the following details of the incident:-

This incident took place on 11.7.1985 at 7.30 P.M. Shri Dharam Pal, Director, came along with three other persons. Shri Bishan Dutt peon was also present there, who was on daily wages basis He is now no longer in a Bank''s services. Shri Jaibir Singh Verma occupied Room No. 4 on that day at 8.30 P.M He was accomoanied by his sister and brother in-law. Shri Bishan Dutt peon brought food for Shri Jaibir Singh Verma and his guests. Shri Dharam Pal and his guests stayed in Room No. 2 and after taking some drink went to market for taking meal. They went at 9.30 P.M. and came back at 10.30 P M. Shri Jaibir Singh Verma slept in Room No. 4 and his guests slept on the roof. Shri Dharam Pal and his guests came at 10.30 P. M. Shri Dharam Pal and his one guest slept on the roof on the cots and his two guests stayed/slept in Room No. 2. We also went to sleep at 11.00 P. M. after finishing our work. At about 12:30 A. M there was a great ''Roullah'' and Shri Dharam Pal asked for the register to find out as to who was sleeping in Room No. 4. Shri Dharam Pal asked Shri Jaibir Singh Verma to leave the premises. There was a quarrel between Dharam Pal and Jaibir Singh Verma Shri Verma asked for telephone so that he could summon the police but he was informed that there was no telephone in the Rest House. Shri Verma said that he would report the matter to the Bank authorities next morning. Thereafter, there was peace in the Rest House.

Crosss examination: I had complained to M. D. Shri Tandon about the incident next morning. Shri Tandon had asked me to give in writing. I and Shri Bhishan Dutt gave the matter in writing to Shri Tandon. I must have informed him at about 10.30 A. M about the incident to Shri Tandon, the then Managing Director. I do not remember whether Shri Verma had stayed in the Rest House earlier and this may be checked from the register. On being asked, Shri Bishan Dutt had brought wine I did not bring.

The Petitioner, in his statement narrated the incident thus:-

On 11-7-1985 I along with three other guests had come to the Rest House of the HARCO BANK. We reached there at about 9.30 P. M. My two guests stayed in Room No. 2. I along with another guest went up-stairs for sleeping. There were already three person including one lady. We found that they were the guests of Shri Verma. Shri Verma was in the room in the down-stairs. I came down and sent for Shri Verma through the peon (Shri Bishan Dutt). I told Shri Verma that I am a Director of the HARCO BANK. He told me that my all guests could sleep in the room and should not sleep up stairs. I said that there was shortage of cots in the room. Shri Verma made a personal issue of this. I asked him whether he had a permit He said that he had no permit. I sent for the register and got made entries in the register. These were cut off later on by the Bank authorities. There was no "ROULA" and all allegations regarding drinking were false

Cross-examination......... Nil.

The crucial allegations against the Petitioner, which constituted ''misconduct'', were the following:-

(1) That he and his guests took liquor in the Guest House.

(2) That at mid-night he entered the room occupied by Shri Jaibir Singh Verma without his permission.

(3) That he, under the influence of liquor, misbehaved with Shri Verma and his relatives including his sister.

It is to be noted that none of the above allegations is proved from the statement of Khiali Ram Tewari PW. 2. In fact, there is no evidence to support these allegations Khiali Ram Tiwari comes in the picture only when he is called by the Petitioner and is asked how Shri Jaibir Singh Verma was staying in the Guest House and whether he had any permit for his stay there. Khiali Ram Tiwari PW. 2 does not say that the Petitioner was under the influence of liquor. He does not even say that the Petitioner and his guests had taken liquor in the Guest House All that he states is that they had taken "some drinks" and had then left for taking their meals in the market and came back at 10.30 p.m. What happened between 11.00 p m. and the time when he was called by the Petitioner at about 12.30 a.m. is not to his knowledge nor does he depose anything about it. When questioned about the allegations against the Petitioner having taken drinks, Khiali Ram Tiwari, PW. 2 stated that wine was brought by Bishan Dutt and he did not bring the same. The Petitioner, in his statement, had denied that there was any noise and had also denied the allegations regarding drinking. His statement also does not show that he misbehave either with Shri Jaibir Singh Verma or his guests including his sister. Thus, to prove the core of the allegations, the evidence, that was material, consisted of the statements of Shri Jaibir Singh Verma and Shri Bishan Dutt, none of whom was examined nor was the Petitioner given an opportunity to cross examine them. In my view, therefore, the allegation of misconduct have been wrongly held to have been proved. In fact, there is no evidence to support the same. The finding, therefore, is preverse and is not sustainable.

I am quite conscious of the fact that, while exercising extraordinary jurisdiction under Article 226 of the Constitution. I am not supposed to disturb a finding of fact by reappreciating the evidence but when a finding is not supported by any evidence on the record, the same cannot be sustained and can be impugned in writ jurisdiction. Another aspect which has impelled me to go into this matter is that, by not producing Shri Jaibir Singh Verma and Bishan Dutt peon, and particularly the former, in the witness box, the Petitioner has been denied the opportunity of cross-examining them so as to bring out the truth. It is to be | noted that the Petitioner as director of the Bank is holding an elected | office. The choice of the electors in a democratic polity has a very vital role to play. An elected representative is not to be lightly removed from his office. Bare allegations, however serious they may be; are not, by themselves, a sufficient excuse to direct removal of an elected office bearer. The allegations against him have to be proved strictly in accordance with the rules of natural justice as are by now well recognized by a catena of judicial decisions. I am, therefore of the firm opinion that the allegations of misconduct against the Petitioner do not stand proved as there is no evidence worth the name on the record to support the same. His removal from the office of the Director of Bank, in the circumstances, through the impugned orders, is therefore, not warranted.

Consequently, I allow this petition and quash the impugned orders Annexure P. 1 and P 3. There shall, however, be no order as to costs.