Madras High Court
M.H. Damodaran vs The Special Officer, Madurai ... on 26 September, 2006
Author: N. Paul Vasanthakumar
Bench: N. Paul Vasanthakumar
ORDER N. Paul Vasanthakumar, J.
1. Prayer in the writ petition is to quash the order of the respondent dated 31.1.2006.
2. The brief facts necessary for disposal of the writ petition as stated in the affidvit in support of the writ petition are that the petitioner while working as Assistant Manager of the respondent Bank, a proceeding under Section 138 of Negotiable Instruments Act was initiated against him by one Santharam in STC No. 330 of 2004 on the file of the Judicial Magistrate Court-IV, Madurai, on the allegation that the cheque issued by the petitioner in his favour was dishonoured due to want of funds. The learned Magistrate convicted the petitioner to undergo six months imprisonment. As against the said conviction, petitioner filed C.A. No. 254 of 2005 and got suspension of sentence in Crl.M.P. No. 58 of 2006 before the Principal Sessions Court, Madurai. The said Santharam informed the respondent about the conviction, pursuant to which the respondent issued a memo to the petitioner on 30.12.2005 and stated that under Rule 149(4) of the Tamil Nadu Co-Operative Society Rules, 1988, petitioner is liable to be dismissed from service as he has been convicted by the Criminal Court. Petitioner submitted explanation on 3.1.2006 and stated that the conviction and sentence was suspended. But without conducting any enquiry or any other proceeding, respondent terminated the petitioner from service on 31.1.2006. The said order of termination is challenged in this writ petition on the ground that under Rule 149(4) an employee can be dismissed from service if a conviction is made in a case involving moral turpitude, but the dishonour of cheque due to want of funds will not come within the purview of moral turpitude and therefore the respondent is not justified in terminating the petitioner's service under Rule 149(4) of the Tamil Nadu Co-Operative Societies Rules, 1988.
3. The respondent filed counter affidavit, wherein it is stated that the writ petition against the respondent is not maintainable as per the Larger Bench Judgment of this Court (M. Thanikachalam and Ors. v. Madhuranthakam Agricultural Producers' Co-Operative Marketing Society and Ors.) and Full Bench decision reported 2004 (2) LLN 1086 (P. Pitchumani and Ors. v. Management of Sri Chakra Tyres Ltd. and Ors.) and the petitioner's remedy is only to approach the Labour Court. It is also stated in the counter affidavit that in view of the conviction order passed by the learned Judicial Magistrate, the petitioner stands disqualified from continuing in the post as per Rule 149(4) of the Tamil Nadu Co-Operative Societies Rules, 1988. It is also stated that the petitioner also violated bye-law No. 10 of the respondent Bank wherein it is stated that an employee shall not have any pecuniary transaction with a person having business connection with the Bank. Since the petitioner is disqualified to continue in the post he was terminated without conducting any enquiry, under Rule 149(4) of the Rules.
4. The learned Counsel appearing for the petitioner, at the time of argument produced the copy of the judgment of the appellate Court made in C.A. No. 254 of 2005 on the file of the Additional District Judge, Fast Track Court-II, Madurai dated 7.6.2006, allowing the appeal based on the compromise entered into between the petitioner and the said Santharam under Section 147 of the Negotiable Instruments Act. Consequently, the complaint filed against the petitioner under Section 138 of the Negotiable Instruments Act was also dismissed as not pressed. The appellate Court set aside the conviction order of the Judicial Magistrate-IV, Madurai, made in STC No. 330 of 2004 dated 6.12.2005 and allowed the appeal. The learned Counsel appearing for the petitioner, relying on the said judgment argued that the termination order cannot stand, particularly after acquittal of the petitioner by the appellate Court, wherein the complaint itself was dismissed as not pressed.
5. The learned Counsel appearing for the respondent/Co-Operative Society argued that committing an act of offence punishable under Section 138 of the Negotiable Instruments Act definitely attracts moral turpitude as it is an act amounting to cheating, punishable under Section 420 IPC. It is further submitted that the acquittal by the appellate Court is not on merits and due to compounding of the offence made between the parties and therefore the respondent is justified in terminating the petitioner from service. The learned Counsel also argued that if on any account the petitioner is entitled to succeed due to the technical plea of not attracting the violation of moral turpitude, still the petitioner can be proceeded for violation of bye-law/rule No. 10 of the respondent Bank and the respondent may be given liberty to proceed against the said violation.
6. I have considered the rival submissions made by the learned Counsel appearing for the petitioner as well as the respondent.
7. The point arises for consideration in this case is whether the petitioner, who was originally convicted for the offence under Section 138 of the Negotiable Instruments Act, gets disqualification automatically as per Rule 149(4) of the Tamil Nadu Co-Operative Societies Rules, 1988.
8. For proper understanding, Rule 149(4) of the Tamil Nadu Co-Operative Societies Rules, 1988, is extracted hereunder, Rule 149(4) No person shall be appointed to the service of any society, if he has been found guilty of any offence involving moral turpitude. An employee shall cease to be as such in a society, if he is found guilty of any such offence.
A reading of the above rule makes it clear that offences involving moral tupitude alone are treated as disqualification to continue in employment.
9. Whether the involvement of an employee in a case under Section 138 of Negotiatble Instruments Act and punishment awarded in the said proceeding will attract moral turpitude is considered by a Division Bench of the Kerala High Court in the decision reported in 1996 Crl.L J 4289 (C.S. Nair v. General manager, State Bank of Travancore, Thiruvananthapuram) and in para 6 and 10 it is held as follows,
6. We are of the view, that an offence under Section 138 of the Act need not necessarily take within its wings the offence of cheating as defined in Section 415 of the Indian Penal Code. A cause of action for a criminal prosecution under Section 138 of the Act will arise, not on the date of issuance of the cheque, but only when the drawer of the cheque fails to pay the amount within the statutory period after he is called upon by the payee through a notice. A person sometimes may issue a cheque knowing that there is no sufficient fund in his account but still with a hope that he would be able to make arrangements with his bankers to honour the cheque as and when it is presented by the drawee. Section 138 is in fact incorporated by the Negotiable Instruments Act only to give more credibility for cheques and not to cover the areas which are already within the jurisdiction of Criminal Court for the offence of cheating. So the question whether the act of issuing a cheque without sufficient funds will involve moral turpitude has to be considered de hors the element of cheating.
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10. Corpus Juris Secendum on which reliance was placed by the appellant's counsel states that moral turpitude implies something immoral in itself, regardless of whether it is punishable by law as a crime, since an act may involve moral turpitude even though it is not a crime (vide Page 1203, Vol.58). It must not merely be mala prohibita, but the act itself must be inherently immoral. It further states that the term moral turpitude "does not refer to conduct which before it was made punishable as a crime, was generally regarded as morally wrong or corrupt, as offensive to the moral sense as ordinarily developed." Penal statutes always make a distinction between intentional and unintentional acts and the punishments also vary. A person may cause the death of another by his rash and negligent driving, which act, though may be an offence, does not involve moral turpitude, but if a person with a deliberate intention drives a vehicles to kill another, it is an offence which involves moral turpitude.
Though the act and the result of that act may be the same in both, the main and important difference between the two is the lack of intention in the former, and the presence of it in the latter. At this stage we may say that prior to the insertion of Section 138 in the Act, issuance of a cheque without sufficient funds was not made an offence unless it falls within Section 415 of I.P.C. As the act of issuing a cheque without sufficient funds was not generally regarded as morally wrong or corrupt we are fortified in our view, that, the offence under Section 138 will not normally involve moral turpitude.
Ultimately the Division Bench in para 12 held that the question whether an offence involve moral turpitude or not has to be decided on the facts of each case. All offences do not necessarily involve moral turpitude. Section 138 of the Negotiable Instruments Act is no exception to the said principle and therefore in that case involvement of moral turpitude has not arisen.
10. In the decision reported in 2005 (3) LLN 1129 (K.S.R.T.C. v. Abdul Latheef), a Division Bench of the Kerala High Court, in para 3 held as follows,
3. When the requirement in Section 138 of the Negotiable Instruments Act is satisfied, one will be deemed to have committed offence. It is only a deeming provision. Offence under Section 138 of the Act being an offence in the commercial practice cannot be taken as one involving moral turpitude, in the absence of any other cogent material to discern moral turpitude. No such special circumstance is pointed out by the appellant. In such circumstances also the direction to reinstate the first respondent cannot be said to be unjustified.
11. The Honourable Supreme Court in the decision (Pawan Kumar v. State of Haryana) held that whether an offence involve moral turpitude or not has to be decided with free guiding principles. The same is held in para 12 of the Judgment, which reads thus,
12. "Moral turpitude" is an expression which is used in legal as also societal parlance to describe conduct which is inherently base, vile, depraved or having any connection showing depravity. The Government of Haryana while considering the question of rehabilitation of ex-convicts took a policy decision on 2-2-1973 (Annexure E in the Paper-book), accepting the recommendations of the Government of India, that ex-convicts who were convicted for offences involving moral turpitude should not however be taken in government service. A list of offences which were considered involving moral turpitude was prepared for information and guidance in that connection. Significantly Section 294 IPC is not found enlisted in the list of offences constituting moral turpitude. Later, on further consideration, the Government of Haryana on 17/26-3-1975 explained the policy decision of 2.2.1973 and decided to modify the earlier decision by streamlining determination of moral turpitude as follows:
... The following terms should ordinarily be applied in judging whether a certain offence involves moral turpitude or not; (1) whether the act leading to a conviction was such as could shock the moral conscience of society in general. (2) whether the motive which led to the act was a base one.
(3) whether on account of the act having been committed the perpetrator could be considered to be of a depraved charcter or a person who was to be looked down upon by the society.
Decision in each case will, however, depend on the circumstances of the case and the competent authority has to exercise its discretion while taking a decision in accordance with the above-mentioned principles. A list of offences which involve moral turpitude is enclosed for your information and guidance. This list, however, cannot be said to be exhaustive and there might be offences which are not included in it but which in certain situations and circumstances may involve moral turpitude.
Section 294 IPC still remains out of the list. Thus, the conviction of the appellant under Section 294 IPC on its own would not involve moral turpitude depriving him of the opportunity to serve the State unless the facts and circumstances, which led to the conviction, met the requirements of the policy decision above-quoted.
12. The above cited two Division Bench decisions of the Kerala High Court are directly applicable to the facts of this case, which clearly state that the offence under Section 138 of the Negotiable Instruments Act is not an offence involving moral turpitude. Therefore, I am of the view that the respondents ought not to have passed the impugned order on the basis of Rule 149(4) of the Tamilnadu Co-operative Societies Rules, 1988.
13. Further, it is to be noted that the complaint filed by the complainant against the petitioner was also dismissed due to compounding of the offence and the conviction and sentence passed by the learned Judicial Magistrate was also set aside by the appellate court by Judgment dated 7.6.2006. This subsequent event is also relevant for consideration in this case. On that score also the termination order passed by the respondent cannot be treated as valid. A Division Bench of this Court in the decision (The Secretary, Vallalar Gurukulam Higher Secondary School, Vadalur, Cuddalore District v. District Educational Officer, Cuddalore, Cuddalore District and Anr.) in para 6 held thus, ... Once a person is acquitted in a criminal case, it has to be deemed that he never committed that offence. This is because every judgment operates retrospectively unless expressly made prospectively, unlike a legislation which normally operates prospectively unless expressly made retrospectively. Since the employee has been acquitted in the criminal case that judgment will operate retrospectively and it has to be deemed that the teacher concerned was never guilty of that offence. Consequently, he is entitled to his salary for the period of his unemployment and he is entitled to reinstatement. We see no infirmily in the order of the learned single Judge. The position may have been different if disciplinary proceedings had also been instituted against the respondent, but that was not done.
14. The next point urged by the learned Counsel for the respondent that the writ petition filed challenging the order of termination passed by the respondent is not maintainable in view of fact that the first respondent is not a State, also cannot hold good because even as per the Full Bench decision, if a monstrosity of the illegality is pointed out in exceptional cases, writ petition is maintainable against the Co-Operative Societies. Here in this case, the respondent without conducting any enquiry had chosen to terminate the services of the petitioner based on his conviction under Section 138 of the Negotiable Instruments Act by invoking Rule 149(4) of the Tamil Nadu Co-Operative Societies Rules, 1988. The respondent failed to consider whether the petitioner's involvement in the said offence involve moral turpitude. The offence having no involvement of moral turpitude as held by the Division Bench of the Kerala High Court, I am of the view that monstrosity of the illegality is proved in this case and therefore the writ petition filed by the petitioner is maintainable as held by the Larger Bench of this Court in the decision (M. Thanikachalam and Ors. v. Madhuranthakam Agricultural Producers' Co-Operative Marketing Society and Ors.) wherein in para 56 it is held as follows,
56. What is necessary to be seen is, if the order passed is without jurisdiction, or before passing any order, it is required to hear the affected party, as per the statute, but not followed, meaning thereby, if the principles of natural justice is not followed, or if there is any flagrant violation of law, or if situations warrant, due to the prevailing of monstrous situation, a writ petition can lie. It is also settled that before invoking the writ jurisdiction, the Court has to satisfy that some special circumstances exist to persuade it to deviate from the settled proposition of law regarding the exercise of a writ jurisdiction under Article 226 and only in such circumstances, efficacious alternate remedy is not a bar to entertain a writ petition. At the same time, as stated above, mere mentioning that there is no efficacious alternative remedy will not give a right to invoke the extraordinary jurisdiction under Article 226 of the Constitution. That apart, we cannot lose sight of the fact that, it may not be possible to dispose of writ immediately. Rather they may be pending for some years or even a decade. As such, the argument that they have no efficacious alternative remedy is not acceptable in toto and writ petition is not maintainable on this count also. It is also to be seen that while agitating the issue before the competent authority, to avail efficacious alternative remedy, the other party will get an opportunity and also cross examine the witness and one has to prove his case. Under the circumstances, a writ petition cannot be entertained to circumvent the other remedies available under the statute. So, no writ will lies. Similarly by merely using the word 'monstrosity', without making any specific averment that there is an outrageous or offensive wrong, no writ will lie, as the facts needs investigation. However, no straight jacket formula can be followed, as each case depends upon the facts and circumstances of its own.
15. The learned Counsel for the respondent has further contended that the petitioner has been dismissed not only on the ground of invoking Rule 149(4) but also for the violation of special bye-law No. 10 of the respondent Bank, which reads as follows,
10. No employee shall have pecuniary transactions with individuals or institutions coming in contact with him in the course of his official duties or accept directly or indirectly on his own behalf or on behalf of any other person, or permit any member of his family to accept any gift, gratuity or reward from any person with whom he is concerned in the performance of his work, provided this rule shall not apply to any borrowings by an employee on the security of his own deposits, savings, insurance policy, etc., from other institutions.
For violation of the bye-law/rule 9 or 10 or 11, bye-law/rule 12 provides for punishment, which reads as follows,
12. Any employee who contravenes the provisions of Rules 9, 10 or 11 shall be liable for such punishment as the authority competent to award it may decide.
It is true that in the notice served prior to the termination, the allegation of violation of rule/bye-law 10 is stated. But no enquiry or opportunity of hearing was given by the respondent for disproving the said violation and no decision was taken on the basis of the proof of violation of bye-law/rule No. 10. Hence the impugned order having been passed without any enquiry being conducted it cannot be sustained on the ground of alleged violation of bye-law/rule 10 of the respondent bank.
16. For the foregoing reasons, the impugned order of termination is set aside with liberty to the respondent to proceed against the petitioner, for the alleged violation of bye-law/rule No. 10 of the respondent bank, if it is warranted.
The writ petition is allowed in the above terms. No costs. Connected miscellaneous petition is closed.