H. P. State Cooperative Bank Ltd. v. State of Himachal Pradesh
2025-10-08
Sandeep Sharma
body2025
DailyLaw.ai
JUDGMENT : Sandeep Sharma, J. After an inordinate delay of 11 years, petitioner herein i.e. HP State Cooperative Bank Ltd., has approached this Court in the instant proceedings filed under Article 226 of the Constitution of India, laying therein challenge to order dated 25.6. 2011, passed by the Under Secretary (Cooperation) to the Government of Himachal Pradesh, thereby dismissing the appeal filed by the petitioner against the order/award dated 7.8.2007 passed by the learned Additional Registrar (Monitoring) Cooperative Societies in Arbitration proceedings instituted under Sections 72 and 73 of the HP Cooperative Societies Act, 1968 ( in short the “Act”). 2. In nutshell, facts of the case as emerge from the pleadings adduced on record by the respective parties are that private respondent namely Prem Chand Kashyap, joined the petitioner–bank in the year 1975 as Cashier cum Clerk (Recovery). In the year 1988, management of the Bhagat Urban Cooperative Bank, Solan, vide resolution dated 20.4.1988, decided to fill up the post of Manager on deputation basis and as such, requested the Managing Director of the petitioner bank to spare the services of any officer of the bank, who may be well converse with the commercial banking. 3. Pursuant to auctions called for by the petitioner-bank, respondent No.3 also opted for the post of Manager of Bhagat Urban Cooperative Bank and conveyed his written option to the post of General Manager in the year 1988. Respondent No.3, who at the relevant time, was Grade-III employee of the petitioner bank, joined the Bhagat Urban Cooperative Bank as Manager in the October 1988 and remained there until 31.12.1996. During his deputation with Bhagat Urban Cooperative Bank, petitioner bank also promoted the respondent No.3 to the post of Officer Grade-II being parent organization. He was further promoted to the post of Officer Grade-I and his pay was fixed vide office order dated 1.8.1996. After afore date, private respondent made an application for his permanent absorption in the Bhagat Urban Cooperative Bank, which prayer of him was acceded to by the petitioner-Bank and accordingly, private respondent was absorbed permanently with the Bhagat Urban Cooperative Bank w.e.f. 1.1.1997. With effect from 1.1.1997, till his superannuation in the year 2014, private respondent worked as an employee of Bhagat Urban Cooperative Bank Solan. 4.
With effect from 1.1.1997, till his superannuation in the year 2014, private respondent worked as an employee of Bhagat Urban Cooperative Bank Solan. 4. In March 2003, petitioner Bank introduced a pension scheme (Annexure P-11) for its employees namely “The Himachal Pradesh State Cooperative Bank Limited; Employees Contributory Pension Scheme 2003” (in short the “Scheme”), which was duly approved by the Registrar (Cooperative Societies) and same was made effective from 1.1.1996. Clause I 1 (2) of the Scheme clearly provides that same shall be deemed to have come into operation w.e.f. 1.1.1996. Since in terms of afore Scheme, all employees, who are on the rolls of the bank on the date of commencement of the Scheme i.e. 1.1.1996, were eligible for Scheme, respondent No.3, who admittedly on 1.1.1996 was an employee of petitioner-Bank, also gave his option to become member of the Scheme w.e.f. 1.1.1996 and while doing so, he also undertook to remit the entire amount of contribution to the pension fund (Annexure P-12). Private respondent wrote an application with regard to his intention to become member of the Scheme to the General Manager of the petitioner-Bank on 18.7.2003, which was subsequently, placed before the Board of Trust of the Pension Scheme, however, same was rejected on 27.9.2004 vide communication dated 1.8.2005. 5. Precisely, the application made by respondent No.3 came to be rejected on the ground that Scheme had come into force w.e.f. 1.1.1996 and those employees, who were serving the bank at the time of commencement of the Scheme, were eligible to become members of the said Pension Scheme. Since respondent No.3 had left the institution in the year 1998 on account of his deputation with Bhagat Urban Cooperative Bank till 13.12.2009 and thereafter, he was permanently absorbed w.e.f. year 1997 and as such, he is not entitled to become member of the Scheme. 6. Being aggrieved and dissatisfied with aforesaid decision taken by the petitioner-Bank, respondent filed arbitration case under Sections 72 and 73 of the Act, which subsequently, came to be decided by the learned Additional Registrar (Monitoring) Cooperative Societies vide award dated 7.8.2007 (Annexure P-14). Vide afore award, learned Arbitrator held respondent No.3 entitled for membership on the ground that he was an employee of the petitioner bank on the date of commencement of Pension Scheme and as such, he is duly covered under the said Pension Scheme. 7.
Vide afore award, learned Arbitrator held respondent No.3 entitled for membership on the ground that he was an employee of the petitioner bank on the date of commencement of Pension Scheme and as such, he is duly covered under the said Pension Scheme. 7. Since afore decision rendered in the arbitration proceedings was not acceptable to the petitioner bank, it filed appeal (case No. 58/07) under Section 93 of the Act before Under Secretary (Cooperation) to the Government of Himachal Pradesh, which also came to be rejected vide order dated 25.6.2011 (Annexure P-16) . 8. Now after an inordinate delay of 11 years, petitioner has approached this Court in the instant proceedings, laying therein challenge to aforesaid order dated 25.6.2011 passed by the appellate authority. 9. It is averred at the behest of the petitioner bank that since Execution Petition filed by the private respondent for execution of order dated 25.6.2011 was dismissed in default in the year 2015 and thereafter, respondent No.3 remained silent upto year 2023, whereafter he again filed execution petition, there was no occasion, if any, for the petitioner bank to file appropriate proceedings, laying therein challenge to order dated 25.6.2011. Aforesaid explanation rendered on record at the behest of the petitioner-Bank qua inordinate delay in filing the petition, deserves outright rejection being totally absurd. Once competent court of law had passed an order dated 25.6.2011, thereby directing the petitioner bank to enroll respondent No.3 as member of the Scheme, as a result thereof, he would have reaped the benefit of pension in terms of the Scheme, there was no option left to the petitioner bank either to implement the mandate contained in order dated 25.6.2011 or to lay challenge to the same in the competent court of law within reasonable time. 10. No doubt, there is no prescribed period of limitation to file writ petition, but certainly by now it is well settled that if there is no prescribed period of limitation, appropriate proceedings, if intended to be filed, should be filed within reasonable period. Delay of 11 years cannot be said to be reasonable period especially for the grounds attempted to be set out by the respondents for condonation of delay. 11.
Delay of 11 years cannot be said to be reasonable period especially for the grounds attempted to be set out by the respondents for condonation of delay. 11. Hon'ble Apex Court in case tilted as Shivamma (Dead) by LRs vs. Karnataka Housing Board & others, Civil Appeal 11794 of 2025, decided on 12.09.2025, held that a different yardstick for condonation of delay cannot be adopted merely because the Government is involved. Since public interest is best served by ensuring efficiency and diligence in governmental functioning, a liberal inclination towards the State or any of its instrumentalities, in matters of condonation of delay, cannot be adopted, merely on the presumption that, if the delay is not condoned, public interest runs the risk of suffering, by a meritorious matter being thrown out. At this stage, it would be profitable to reproduce relevant paras of aforesaid judgment herein below:- “228. Limitation laws are themselves grounded in public policy, as already discussed in the preceding paragraphs of this judgment, it is based on the maxim ‘interest reipublicae ut sit finis litium’ i.e., “it is for the general welfare that a period be put to litigation”. Therefore, public interest is better served by timely governmental action than by condoning repeated lapses. State cannot simultaneously seek to represent the interest of the public and yet consistently fail to protect that very interest by allowing limitation periods to lapse. 229. Public interest is best served by ensuring efficiency and diligence in governmental functioning, rather than by condoning its lapses as a matter of course. Thus, a liberal inclination towards the State or any of its instrumentalities, in matters of condonation of delay, cannot be adopted, merely on the presumption that, if the delay is not condoned, public interest runs the risk of suffering, by a meritorious matter being thrown out. Public interest lies not in condoning governmental indifference, but in compelling efficiency, responsibility, and timely action. 230. To permit condonation of delay to become a matter of course for the Government would have the deleterious effect of institutionalising inefficiency. It would, in substance, incentivise indolence and foster a culture where accountability for delay is eroded. If the State is assured that its lapses will invariably be excused under the rubric of “public interest,” there would remain little incentive for its officers to act with vigilance or for its instrumentalities to streamline procedures for timely action.
It would, in substance, incentivise indolence and foster a culture where accountability for delay is eroded. If the State is assured that its lapses will invariably be excused under the rubric of “public interest,” there would remain little incentive for its officers to act with vigilance or for its instrumentalities to streamline procedures for timely action. The consequence would not be the advancement of public interest but rather its betrayal. 231. Public interest, therefore, does not lie in condoning governmental negligence, but in compelling efficiency, responsibility, and timely decision-making. This Court has time and again emphasised that liberal condonation of delay on behalf of the State, merely on the ground that refusal might cause the dismissal of a potentially meritorious matter, is a misplaced proposition. Public interest is not synonymous with the cause of the Government; it is, instead, synonymous with the enforcement of rule of law, certainty in legal rights, and an administrative machinery that functions with diligence and accountability. 232. It must, therefore, be underscored that the guiding principle is not the protection of governmental indifference but the promotion of responsible governance. The State is under a higher duty to act in time, for in every matter it litigates, it does so not in its private capacity, but as the trustee of the people’s interest. Hence, repeated indulgence in condoning delays on grounds of bureaucratic inefficiency would amount to eroding the very object of limitation statutes, which are enacted in every civilised jurisdiction for the sake of finality, certainty, and public order. 233. Any other view, would invariably defeat the sound public policy embodied in the Limitation Act and fail in enthusing efficiency in administration, and bring a balance between accountability and autonomy of action, It would result in giving immunity or carte blanche power to act as it pleases with the public at whim or vagary and inevitably spell doom all over the collective responsibility that the State and its instrumentalities are entrusted with. Thus, we are of the considered opinion, that delay cannot be condoned, merely because not doing so would result in non-suiting the State and thereby run the ostensible risk of public interest suffering.
Thus, we are of the considered opinion, that delay cannot be condoned, merely because not doing so would result in non-suiting the State and thereby run the ostensible risk of public interest suffering. Such by no stretch can be the sole consideration for the purpose of Section 5 of the Limitation Act, as to do so would be to ignore the provision of Section 3 and the overarching public policy of giving quietus to lis that forms the bedrock of the Limitation Act”. 12. Though being totally unsatisfied by the explanation rendered on record qua the inordinate delay in filing the petition at hand, coupled with the various pronouncements made in that regard by the Hon’ble Apex Court, there appears to be no justification for this court to proceed with the matter further, but yet to settle the controversy for all times to come, this Court shall also make an endeavour to ascertain the correctness of the rival submissions made by the learned counsel for the parties vis-à-vis legality of impugned order as well as award dated 25.6.2011 in the instant proceedings. 13. In nutshell, case of the petitioner bank is that since on 1.1.1996, private respondent had gone on deputation to Bhagat Urban Cooperative Bank, Solan and thereafter, he was permanently absorbed on 1.1.1997, he cannot claim any membership in terms of provisions contained in the Scheme. 14. Mr. Sunil Mohan Goel, learned senior counsel, appearing for the petitioner, duly assisted by Mr. Raman Jamalta, Advocate, vehemently argued that bare reading of Scheme in its entirety clearly suggests that same is applicable to only such of the employees of the petitioner bank, who retired from the bank, but certainly, same was not applicable to the private respondent, who though was initially recruited by the petitioner bank, but ultimately, retired from Bhagat Urban Cooperative Bank, Solan. While referring to the various provisions contained under the Scheme, Mr. Goel, argued that employees in terms of Scheme would mean “a member in service of the bank at the commencement of the scheme”, but he was unable to dispute the fact that Scheme though was launched in the year 2003, but was made effective w.e.f. 1.1.1996, on which date, petitioner was admittedly the employee of the petitioner bank.
Goel, argued that employees in terms of Scheme would mean “a member in service of the bank at the commencement of the scheme”, but he was unable to dispute the fact that Scheme though was launched in the year 2003, but was made effective w.e.f. 1.1.1996, on which date, petitioner was admittedly the employee of the petitioner bank. While referring to Clause III i.e. Membership, he submitted that though retired employee on or after 1.6.1997, can opt for the Scheme but since private respondent never retired from the petitioner-Bank, he cannot claim membership, merely on the ground that he was on the rolls of the bank on the date of commencement of the Scheme. He submitted that to become member in terms of the Scheme, employee concerned, besides on the rolls of the bank, should have been retired from bank itself. 15. To the contrary, Ms. Meenakshi Sharma, learned counsel for the petitioner, vehemently argued that bare perusal of the Scheme itself suggests that all employees, who were on rolls of the bank on the commencement of the Scheme i.e. 1.1.1996 are eligible to become member. True, it is that respondent was permanently absorbed in Bhagat Urban Cooperative Bank, Solan, w.e.f. 1.1.1997, but thereafter, for all intents and purposes, he would be deemed to have been retiered from the petitioner bank w.e.f. 1.1.1997. If it is so, he is otherwise eligible to become member of the Scheme. While referring to the definition of “service” given in the Scheme, Ms. Sharma, further argued that the “services” would mean service rendered in the bank as regular employee and service rendered in any other institution/society/Govt. on deputation basis or otherwise. She submitted that since petitioner w.e.f. 1.1.1988 till 1.1.1997, remained on deputation with Bhagat Urban Cooperative Bank Solan for all intents and purposes, he shall be deemed to be employee of petitioner bank w.e.f. 1.1.1997, whereafter he was permanently absorbed in the Bhagat Urban Cooperative Bank. If it is so, he is very much entitled to membership in terms of Clause III of the Scheme. 16.
If it is so, he is very much entitled to membership in terms of Clause III of the Scheme. 16. Having heard learned counsel for the parties and perused material available on record vis-à-vis reasoning assigned in the order impugned in the instant proceedings, this Court finds that respondent herein had joined the petitioner-Bank as Cashier cum Clerk and thereafter, in the year 1988, he was promoted by the petitioner bank to join services of the Bhagat Bank on deputation basis. Most importantly, while private respondent was on deputation with Bhagat Bank, he was granted two promotions; firstly, as Grade-II employee and thereafter, as Grade-I. W.e.f. 1.1.1997, private respondent came to be absorbed in Bhagat Bank, pursuant to valid permission given in that regard by the petitioner bank. No doubt, after 1.1.1997, for all intents and purposes, respondent became employee of Bhagat Urban Cooperative Bank, Solan, but question which needs to be determined in the case at hand, is “whether in terms of scheme which though was framed in the year 2003, but was made effective w.e.f. 1.1.1996, respondent being old employee of the petitioner-Bank can claim membership or not”. 17. At this stage, it would be apt to take note of relevant provisions contain in the Scheme, which read as under: “Contributory Pension Scherme-2003 for the employees of the Himachal Pradesh State Cooperative Bank Ltd. 1. Short Title, Extent and Commencement. 1. This Scheme may be called "H.P. State Cooperative Bank Ltd; Employees Contributory Pension Scheme-2003" 2. Save as otherwise expressly provided in this scheme; the Scheme shall be deemed to have come into force/commenced w.e.f.01/01/1996 3. This Scheme shall commence from 01/01/2003 onwards for the purpose of payment of pension. Based on the available balance in the Contributory Pension Fund and projected inflows and outflows in the succeeding five years, the scheme shall be reviewed and necessary revision in the contribution etc., if required shall be made. 4. This Scheme shall apply to members of the Scheme only. II. Definition In this scheme unless the context otherwise requires:- a. "Scheme means "H.P. State Cooperative Bank Ltd; Employees Contributory Pension Scheme-2003" as amended from time to time b. "Bank" means the H.P. State Cooperative Bank Ltd H.O. The Mall Shimla. c. "Board" means Board of Directors of the Bank.
This Scheme shall apply to members of the Scheme only. II. Definition In this scheme unless the context otherwise requires:- a. "Scheme means "H.P. State Cooperative Bank Ltd; Employees Contributory Pension Scheme-2003" as amended from time to time b. "Bank" means the H.P. State Cooperative Bank Ltd H.O. The Mall Shimla. c. "Board" means Board of Directors of the Bank. d. "Registrar" means Registrar Cooperative Societies H.P. e. "Service Rules" means H.P. State Cooperative Bank Rules relating to the terms of employee and working condition of the employees 1979 as amended from time to time. f. "Competent authority" means the authority appointed/constituted by the Board/Trust for the purpose of the Scheme. g. "Employees" means a member in the service of the Bank at the commencement of the Scheme, on full time work on regular scale as defined in the Service-Rules of the Bank and, who opts and is governed by this scheme but shall not include person include person employed on contract, part time, daily wage basis, on consolidated basis, work charged or employed under any project / Scheme financed by any other authority, h. "Qualifying Service" means the service which qualifies for person under this scheme. It shall be reckoned in term of in term of completed year, provided that the fraction equal to six months and above shall be counted as full year. I. "Service" means services rendered in the Bank as regular employee and service rendered in any other institution/ society/Govt. on deputation or otherwise as ordered by the competent authority subject to having contributed towards Pension Fund at the provided rate. ‘ J. "Contribution" means as prescribed contribution of the member. k. "Date of Retirement" means the last date of the month in which an employee attains the age of superannuation or the date on which he is retired by the Bank or the date on which an employee is deemed to have retired. 1. "Calendar Year" means a year commencing on 1st day of January and ending on 31st of December. m. "Trust" means the Trust to be constituted by the Board of Directors of the Bank to manage and run the affairs of the Contributory Pension Scheme smoothly for the welfare of the employees. n. "Members" means an employee who opts for the Contributory Pension Scheme and pays the prescribed contribution.
m. "Trust" means the Trust to be constituted by the Board of Directors of the Bank to manage and run the affairs of the Contributory Pension Scheme smoothly for the welfare of the employees. n. "Members" means an employee who opts for the Contributory Pension Scheme and pays the prescribed contribution. o. "In service employee" means all employees of the Bank who are on the regular pay scale of the Bank on the date of commencement of this scheme to be recruited in future. p. "Retired Employees" means an employee who attains the age of superannuation and is retired from the Bank but not compulsory retired as a measure of punishment, terminated or dismissed employee. q. "Family" means the wife/husband of the employee and children son(s) or unmarried daughter(s)who have not attained the age of 25 years and includes legally adopted son(s) daughter(s) III. Membership: The membership will be open to:- a) All employees who are on the rolls of the Bank on the date of commencement of the Scheme i.e. 01/01/1996 to become eligible for the scheme, who opts for the same and pays contribution b) Employees recruited after 01/06/1997 who opts for the scheme and pays contribution on prescribed rates c) A retired employee on or after 01/01/1996 from the service of the Bank, who opts for the scheme and pays contribution in manner prescribed in the scheme. IV. Option A. The employee retired from service from 01/01/1996 to 31/12/2002 may opt the scheme for and upto 120 months prior to the date of retirement and pays contribution in the prescribed manner. B. The in service employee as on 31/12/2003 who intend to acquire qualifying service as on this date may opt and contribute to the scheme for and upto the period of 120 months subject to condition that the option and contribution cannot be made prior to the date of regular appointment in the Bank. C. The employees recruited after 31/12/2002 shall be entitled to opt for the scheme from the date of his appointment.” 18. In terms of Scheme, an “employee” would mean a member in service of the bank at the commencement of the scheme on full time work on regular scale as defined in the Service Rules of the bank,. Admittedly, at the time of commencement of Scheme i.e. w.e.f. 1.1.1996, private respondent was regular employee of petitioner-Bank.
In terms of Scheme, an “employee” would mean a member in service of the bank at the commencement of the scheme on full time work on regular scale as defined in the Service Rules of the bank,. Admittedly, at the time of commencement of Scheme i.e. w.e.f. 1.1.1996, private respondent was regular employee of petitioner-Bank. “Services” would mean service rendered in the bank as regular employee and service rendered in any other institution/society/Govt. on deputation basis or otherwise. Admittedly, petitioner herein remained on deputation at Bhagat Bank w.e.e.f 1.1.1988 till 1.1.1997 and as such, for the period he remained on deputation with Bhagat Bank, respondent shall be deemed to be in the service of the petitioner-Bank. Most importantly, “In Service Employee” as has been defined in the Scheme would mean “ all employees of the bank who are on the regular pay scales of the bank on the date of commencement of the Scheme to be recruited or to be recruited in future” Admittedly, at the time of commencement of Scheme, respondent was an employee of the petitioner-bank and as such, he is deemed to be in “Service Employee” at the time of commencement of the Scheme. 19. As per Clause-III, “Membership”, as extracted herein above, clearly reveals that all employees, who are on the rolls of the bank at the time of commencement of the Scheme i.e. 1.1.1996 are eligible to become member subject to their giving option and deposit of contribution earlier received by them. As has been taken note herein above, at the time of commencement of scheme i.e. 1.1.1996, private respondent was on the rolls of the petitioner bank and as such, he is eligible to become member of the Scheme. As per clause (c) of Clause III of Membership, a retired employee on or after 1.1.1996 from the service of the bank can also become member subject to their opting for Scheme and paying contribution in a manner prescribed in the Scheme, meaning thereby, even such employees, who have retired after 1.1.1996, could become members of the Scheme. 20.
As per clause (c) of Clause III of Membership, a retired employee on or after 1.1.1996 from the service of the bank can also become member subject to their opting for Scheme and paying contribution in a manner prescribed in the Scheme, meaning thereby, even such employees, who have retired after 1.1.1996, could become members of the Scheme. 20. Though this court is fully convinced that petitioner on account of his being on the rolls of the bank at the time of commencement of scheme on 1.1.1996 is eligible to become member but even if it is presumed that he is ceased to be on the rolls of the petitioner bank after 1.1.1997, on account of his joining Bhagat Urban Cooperative Bank, he shall be entitled to become member in terms of afore clause (c), which provides for Membership on account of his having left the job of the bank after 1.1.1996. 21. Though at this stage, Mr. Sunil Mohan Goel, learned counsel for the petitioner attempted to argue that petitioner never retired from bank, rather w.e.f. 1.1.1997 he resigned from the bank for joining at Bhagat Urban Cooperative Bank, but such argument of him is wholly untenable for the reason that though private respondent submitted resignation on 1.1.1997, enabling him to be permanently absorbed in Bhagat Urban Cooperative Bank, but for all intents and purposes, he would be considered to be retired from the service of the petitioner bank w.e.f. 1.1.1997. 22. Since respondent No.3 was on the rolls of the bank on the date of commencement of the Scheme w.e.f. 1.1.1996, no illegality can be said to have been committed by the Arbitrator and thereafter, by Under Secretary (Cooperation) to the Government of Himachal Pradesh, thereby rejecting the claim of the petitioner-bank. 23. Scheme provides for option of “In Service Candidate” and option by “retired employees”. Admittedly, till 1.1.1997, respondent No.3 can be said to be “in service candidate”, but thereafter on account of his absorption in Bhagat Urban Cooperative Bank Solan, he would be deemed to have retired from the service of petitioner bank. If it is so, petitioner bank while extending benefit of the Scheme, may have to consider the respondent as retired employee of the bank, who otherwise while opting for scheme had expressed his intention to deposit the contribution towards the Scheme. 24.
If it is so, petitioner bank while extending benefit of the Scheme, may have to consider the respondent as retired employee of the bank, who otherwise while opting for scheme had expressed his intention to deposit the contribution towards the Scheme. 24. Consequently, in view of the detailed discussion made herein above as well as law taken into consideration, petition having been filed by the petitioner- bank is dismissed on both the counts i.e. limitation as well as merit. Since respondent No.3 has been fighting for his rightful claim for quite long, this court hopes and trusts that needful for providing membership to respondent No.3 shall be done by the petitioner expeditiously, preferably, within four weeks from the date he makes contribution as per the Scheme. 25. In the aforesaid terms, present petition is disposed of alongwith pending applications, if any.