B. Nair & Ors. Vs. State Of Kerala & Ors.  INSC 994 (27 May 2008)
S.B. SINHA & LOKESHWAR SINGH PANTA
[Arising out of SLP (Civil) No. 1826 of 2007] WITH
Civil Appeal Nos. 4177,4178 of 2008 [Arising out of SLP (C) Nos. 1227 and 3596
of 2007] REPORTABLE S.B. SINHA, J.
1. Leave granted.
2. Appellants are before us aggrieved by and dissatisfied with a judgment
and order dated 18.07.2006 passed by the Kerala High Court in Writ Appeal
Nos.2275, 2527 and 2622 of 2005 affirming the judgment and order dated 7.9.2005
passed by a learned single judge of the said Court.
3. Recruitment to the posts is made by the respondent No. 4 Commission. A
requisition was made for filing up of 214 posts.
Allegedly, the respondent No.2 approved only 208 posts. 201 vacancies were
filled up. Contending inter alia that the Respondent - Cooperative Bank could
fill 16 more vacancies, a writ petition was filed. A learned single judge of
the High Court opined that having regard to the approved vacancy position, six
more vacancies could be filled up and one vacancy having arisen due to
non-joining of the same could also be filled up. A direction was, therefore,
issued to fill up seven more vacancies. An intra- court appeal was preferred
thereagainst, which by reason of the impugned judgment has been dismissed
The vacancies already stand reported to the Public Service Commission
in implementation of the interim order passed on 10.12.2004 and this report
shall be deemed to have been in respect of the vacancies occurred before the
expiry of the list, limited to the vacancies available. There cannot have any
dispute on that. In Ext.P10, the Registrar had approved the staff strength
sanctioning only 208 posts of clerk/cashier. Out of that, only 201 are in
position. Therefore, there are remaining 7 vacancies. These 7 vacancies shall
be taken as, as mentioned above, reported before 31.12.2004 and the candidates
shall be advised as if the report had been received before the expiry of the
said date, following the appropriate ratio and communal rotation as applicable
to the post. As the Public Service Commission had received the report regarding
the Non Joining Duty vacancy only on 10.5.2005, they need consider it as one in
respect of the vacancies that had arisen after the expiry of the list. When the
Registrar had sanctioned only 208 posts, whatever be the resolution in
Ext.R4(g) or the contentions raised in the counter affidavit, the bank is
disabled from appointing persons any more than what is contained in the order
of the Registrar. Moreover, because of the computerization of the branches and
other modern facilities introduced in the banking business, necessarily there
may be reduction in the number of vacancies. Therefore, the view taken by the
learned Single Judge to direct 7 vacancies to be advised, cannot be said to be
unjustified to invite interference in these appeals.
4. Mr. Sree Kumar, learned counsel appearing on behalf of the appellants
submits that the High Court committed a serious error in so far it failed to take
into consideration that having regard to the decision of the said Court in
Elampal Service Coop. Bank Ltd. v. Government of Kerala, [2000 (3) KLT 389],
approval of Registrar in such matters was not necessary and in any event
profitability or otherwise of the Cooperative Bank being not a relevant factor
for determining the cadre strength and, thus, the impugned judgment cannot be
5. Mr. Roy Abhraham; Mr. P.V. Dinesh and Mr. Vipin Nair, lerned counsel
appearing on behalf of the Respondent Cooperative Bank, Kerala Public Service
Commission and the State of Kerala, on the other hand, submit that the ranked
list having expired on 31st December, 2004 the High Court could not have issued
any writ on the petition filed by the appellants herein, particularly in view
of the fact that the Bank had taken a policy decision not to fill up any other
or further post. It was furthermore submitted that in terms of Rule 182 of the
Kerala Cooperative Societies Rules, 1969, the approval of the Registrar is imperative.
6. Indisputably requisition was made by the respondent-Bank to the
Commission for appointment of 220 clerk-cum-cashier in the Bank.
After the processes were gone into ranked list was prepared on or about 18th September, 2001. Its validity expired on or about 31st December, 2004. Some persons did not join the posts. The vacancies remained unfilled.
Another requisition for filling up of the vacancies position was notified
again on or about 10th May, 2005 by which date the validity of the earlier ranked
list expired. It is now accepted at the Bar that pursuant or in furtherance
thereof the Commission has already conducted an examination on 10th May, 2008, and in terms thereof a fresh rank list would be prepared.
7. A decision on the part of an employer whether to fill up the existing
vacancies or not is within its domain. On this limited ground in absence of
discrimination or arbitrariness, a writ court ordinarily would not interfere in
such matters. This has been so held by this Court in Deepa Keyes v. Kerala
State Electricity Board, [(2007) 6 SCC 194] observing that the rank list having
expired and the validity having not been extended, no relief could be granted
to the appellants therein.
8. Similar view has also been expressed by this Court in K.
Thulaseedharan v. Kerala State Public Service Commission, Trivandrum and
others, [ (2007) 6 SCC 190 ]
9. Recruitment to a post having regard to the provisions contained in
Article 320 of the Constitution of India must be made by the Committee in terms
of the Statutory Rules.
Rule 188 of the 1969 Rules provides for a staff pattern in the following
terms :- 188. Staff Pattern. Every society shall adopt the staff pattern
indicated in Appendix III to these rules, according to the type and class to
which it belongs :
Provided that where any society cannot adopt such staff pattern due to its
financial position, the members of the committee may work; in an honorary
capacity in lieu of appointing any paid employee :
Provided further that where any society is in need of any change in the
pattern of staff including the scale of pay under special circumstances the
same may be made by the society with the prior approval of the Registrar of
10. A Division Bench of the Kerala High Court in Elampal Service Cooperative
Bank Ltd. (supra) opined that the power of the Registrar either to rescind a
resolution or reclassification made by the Cooperative Society can be exercised
so as to enable him to set them aside, stating:- If reclassification made
by the petitioner Bank is incorrect, the Registrar is not helpless in setting
aside the resolution passed.
11. Rules appear to have undergone a change in 2004 by way of Kerala
Cooperative Societies (Amendment) Rules, 2004. Note 4 Appended to Appendix II
under Serial No.2m under Class IV of the 1969 Rules reads as under :- Note
4 :- Classification made by the Societies should be got certified and approved
by the registrar of Co-operative Societies before being implemented.
12. Thus, it may not be entirely correct that the Registrar will have no say
in the matter. Financial heath of a bank is a relevant factor.
13. In this case from the profit and loss account it appeared that the
statement for classifying the branches were not prepared scientifically and
hence a true picture of the financial position was not reflected therein. The
Registrar has the responsibility to see that the Cooperative Societies function
effectively and efficiently. A Cooperative Bank, according to the guidelines
issued by NABARD, should be in a position to maintain the cost of management to
working fund at the optimum level of 2 %. The cost of management, however, of
the Cooperative Bank in question was found to be 8 %, which according to the
Registrar, was at an alarming level as has been observed by the Auditor.
14. The cadre strength of a Cooperative Society would depend upon its
classification thus, although the Registrar may not have anything to do
therewith directly, but the same would follow as a necessary corollary.
15. It furthermore appeared that the classification norms which were
prescribed by the Government long time back may not be valid in the present day
situation having regard to the computerization programme resorted to by the
In its counter-affidavit the State of Kerala averred:- The Central
Banks Conference, which is the forum constituted to take stock of the progress
and to review the problem faced by the credit structure in the state consisting
the representatives of District Co-operative Banks, Kerala State Co-operative
Bank, Government, Registrar of Co-operative Societies, has of the view that the
present classification norms needs changes in par with the present credit
scenario and slow growth of the movement, threat posed by the new generation banks
in the wake globalization and liberalization, a committee has been constituted
to study the aspect and the committee recommended to change the classifications
of District Co-operative Bank urgently, lest the very existence of the banks
will be in peril. The proposal is under active consideration of the Government,
and it is expected that the classification norms will be revised soon.
16. In the absence of any material it is difficult for a court to arrive at
a firm conclusion that having regard to the fact that over a period of time the
Cooperative Bank had opened many more new branches or the volume of its
operation had increased requiring appointments of more persons. What would be
the effect of computerisation is also not known.
Only because the Bank has sent a requisition or had been making recruitments
in other categories of staff by itself may not be a ground for issuance of a
writ of or in the nature of mandamus, although the Cooperative Bank had adopted
a policy decision not to fill up more than 201 vacancies which stands filled up
to 208 vacancies in terms of the judgment of the learned Single Judge of the
17. In Shankarsan Dash v. Union of India [(1991) 3 SCC 47], this Court held:
7 . It is not correct to say that if a number of vacancies are notified
for appointment and adequate number of candidates are found fit, the successful
candidates acquire an indefeasible right to be appointed which cannot be
legitimately denied. Ordinarily the notification merely amounts to an invitation
to qualified candidates to apply for recruitment and on their selection they do
not acquire any right to the post. Unless the relevant recruitment rules so
indicate, the State is under no legal duty to fill up all or any of the
vacancies. However, it does not mean that the State has the licence of acting
in an arbitrary manner. The decision not to fill up the vacancies has to be
taken bona fide for appropriate reasons. And if the vacancies or any of them
are filled up, the State is bound to respect the comparative merit of the
candidates, as reflected at the recruitment test, and no discrimination can be
permitted. This correct position has been consistently followed by this Court,
and we do not find any discordant note in the decisions in State of Haryana v.
Subhash Chander Marwaha, Neelima Shangla v. State of Haryana, or Jatendra Kumar
v. State of Punjab. [See also Jitendra Kumar & Ors. v. State of
Haryana & Anr., [ 2008 (2) SCC 161 ].
18. The question as to whether there existed 7 vacancies or 16 vacancies in
the aforementioned situation looses all significance. We would assume that as
per the requisition, 9 more vacancies could be filled up but it is trite that
if the employer takes a policy decision not to fill up any existing vacancy,
only because a persons name is found in the select list, the same by
itself would be a ground to compel the bank to fill them up.
19. Rules of the Cooperative Societies as has been interpreted by this Court
in Deepa Keyes (supra) and K. Thulaseedharan (supra) clearly show that after
the expiry of rank list, vacancies should not be directed to be filled up.
20. This Court furthermore cannot issue a direction only on
21. For the reasons aforementioned no relief can be granted to the
appellants. The appeals fail and are dismissed. However, in the facts and
circumstances of the case, there shall be no order as to costs.
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