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Writ Petition No.24 of 1986, decided on 7th March, 1987.

‑‑‑ S. 44‑‑Co‑operative Societies Act (VII of 1925)‑‑Writ petition, maintainability of‑‑Respondent, a Bank, registered under Cooperative Societies Act, 1925 as adopted in Azad Kashmir having Chief Secretary, Secretary Finance, Secretary Co‑operative Development, Commissioner, Revenue Commissioner, Secretary Agriculture and Registrar Co‑operative as its ex officio Members with Chief Secretary as ex officio President and Chairman of Board of Directors‑‑ Contention that respondent‑Bank did not perform functions in connection with affairs of Azad Jammu and Kashmir or Local Authority and as such was not amenable to writ Jurisdiction of High Court, held, was devoid of any force.

‑‑‑ S.44‑‑Co‑operative Societies Act (VII of 1925), S. 70‑A‑‑Writ Jurisdiction‑‑‑ Alternate remedy‑‑Respondent, Azad Kashmir Government Co‑operative Bank passing order treating period of extension in service beyond the age of 60 years granted earlier to petitioner as re‑employment‑‑Jurisdiction of civil Court to determine validity of such order barred under S.70‑A of Cooperative Societies Act, 1925‑‑ Contention that alternate remedy was available to petitioner against impugned order in a civil 'Court, held, was., therefore, without any merit.

‑‑‑ S. 44‑‑Writ jurisdiction‑‑Respondent, Azad Kashmir Government Co‑operative Bank by impugned order treating period of extension in service granted to petitioner by its earlier order as re‑employment‑‑No material on record indicating that petitioner had in fact accepted his retirement in terms of impugned order by his conduct‑ ‑Petitioner on the other hand shown to have claimed amount of pension under protest reserving his right to challenge impugned order in Court of law‑‑Objection that petitioner had waived his right to challenge impugned order in a writ petition, held, was without any valid basis.

‑‑‑ S.44‑‑Azad Jammu and Kashmir Government Co‑operative Bank (Staff) Service Rules, 1984, R.1 (b)‑‑General Clauses Act (X of 1897), S.21‑ Locus poenitentiae principle of‑‑Maxim. audi alteram partem (no one should be condemned u n heard) ‑‑Petitioner, General Manager, Azad Jammu and Kashmir Government Co‑operative Bank, given two years extension in service from date of completion of age of 60 years under decision of Board of Directors of Bank‑‑Order passed on basis of such decision found to be perfectly valid lawful and effective‑‑No law or Rules prescribing age of superannuation of employees of Bank existing at relevant time and it could not be contended that petitioner had by operation of law retired on his completing age of 60 years and as such decision of Board of Directors extending his service beyond said age was ab initio void and unlawful‑‑Board of Directors of Bank in a subsequent meeting deciding to consider petitioner having retired on his attaining age of 60 years and to treat period of his service after said age as period of his re‑employment‑‑impugned order issued on basis of such decision, held, had the effect of cancelling or, at least, amending the previous decision of Board of Directors whereby petitioner's service was extended for two years from date of his completing age of 60 years and that the Board of Directors had no powers to cancel or amend the same‑‑Previous decision of Board of Directors allowing petitioner to remain in service for a period of two years, after attaining age of 60 years, had been acted upon and carried into effect when subsequent decision amending same was taken and since under said decision, a decisive step had been taken and petitioner had become entitled to count period of his service rendered under it towards his pension and other retirement benefits, same could not be rescinded or' amended by their subsequent decision either in exercise of powers under S.21 of General Clauses Act, 1897, or under rule of locus poenitentiae‑‑Previous decision of Board of Directors could also not be undone in view of provisions of R. (b) of Azad Jammu and Kashmir Government Co‑operative Bank (Staff) Service Rules, 1984 which creates a bar to reopening of cases relating to service matters of employees of the Bank‑‑Impugned order having been made without hearing petition or giving him an opportunity of being heard was also bad in law being violative of principle of natural justice i.e. audi alteram partem‑‑Impugned order declared to have been made without lawful authority and of no legal effect and consequently set aside.

Venkatesh Yesheant Deapnande v. Emperor A I R 1938 Nag. 513; Shah Baz s case P L D 1956 F C 46; Mahboob Rabbani v. Government of West Pakistan P L D 1963 Lah. 53; Farid Khan v. State P L D 1965 Pesh. 31; Habibullah Lone v. The State Writ Petition No. 20 of 1978 and Sattar Muhammad v. Chief Conservator of Forests P L D 1980 S C (AJ&K) 46 ref.

Abdur Rashid for petitioner.

Muhammad Hanif Khan and Shahad Ahmad for Respondents.

The brief facts of the case as alleged in this writ petition are that Qazi Abdul Hayee, petitioner was an employee of the Azad Kashmir Government Co‑operative Bank Ltd. (hereinafter referred to as respondent‑bank) who continued to remain in service of the respondent bank even after his attaining the age of 60 years on 18‑2‑1982. The Board of Directors of the respondent‑Bank in their meeting held on 20‑1‑1983 considered the matter of retiring or extending the service of the petitioner and accorded sanction to the grant of two years extension in his service from 19‑2‑1982, the date on which he had completed 60 years of his age. After the expiry of his above period of extension in service, the petitioner was re‑employed for a further period of six months vide decision of the Board of Directors taken in a meeting held on 3‑3‑1984.

The petitioner, after his being relieved from the services of the respondent‑Bank, took up the matter of his pension and other allied benefits with the various authorities as a result of which the question of validity of the decision of the Board of Directors, dated 20‑1‑1983 pertaining to the extension in service of the petitioner was considered in the meeting of the Board of Directors held on 16‑2‑1985 and it was decided to seek the opinion of the Law Department in the matter and accordingly the summary of the case was sent to the said Department. The Law Department, in reply, gave the opinion to the effect that since there existed no rules pertaining to the conditions of service of the respondent‑Bank, the Board of Directors was competent to sanction two years extension in the service of the petitioner and as such by re‑opening the matter, the period of extension could not be treated as his re‑employment. But, in spite of the above opinion, the Board of Directors in its meeting held on 10‑8‑1985, took the decision to consider the petitioner having retired from 19‑2‑1982 on his attaining the age of 60 years and to treat the period of his service in the Bank after the said date as the period of his re‑employment and subsequently on the basis of the above decision, the impugned order was issued on 1‑1‑1986 under the signature of the Secretary of the respondent‑Bank and the Board of Directors whereby the petitioner was retired from the service of the respondent‑Bank with effect from 18‑2‑1982 afternoon and his period of employment in the service of the respondent‑Bank from 19‑2‑1982 to 12‑11‑1984 afternoon was treated as his re‑employment and accordingly his pension and other retirement benefits were determined as follows: ‑---------

(i) Gross pension w.e.f. 19‑2‑1982. Rs.1,368.96

(ii) th share of the surrender value. Rs. 54,785.00

(iii) th share of the commutation value. Rs.48,814.00

(iv) Net pension payable from 19‑2‑1982. Rs. 684.48

3. Feeling aggrieved by the above impugned order, the petitioner has filed this writ petition in which the validity of the same has been challenged and the prayer has been made to declare it to have been made without lawful authority and of no legal effect and that the petitioner is entitled to the benefits of extensions given in his service and to further direct the respondents to proceed in the case of the petitioner in respect of the grant of his pension and other allied benefits in accordance with law.

4. The case of the petitioner is that the impugned order is unlawful as the decision of the Board of Directors, dated 20‑1‑1983, extending his services for two years from the date of his completing the age of 60 years, could not be rescinded or cancelled and his extended period of service treated as re‑employment and that it has been made without giving the petitioner an opportunity of being heard as was required under the principle of natural justice.

5. The writ petition has been contested by the respondents both on legal grounds as well as on merits. In the written statement, preliminary objection has been taken as to the maintainability of this writ petition on the ground that the respondent‑Bank is a Corporate body not performing functions in connection with the affairs of the Azad Kashmir or Local Authority and that the petitioner had waived his right to challenge the impugned order by accepting the date of his retirement, and pension and other retirement benefits sanctioned under it.

6. On the merits, it is alleged that the age of retirement of the employees of the respondent‑Bank was 60 years in view of which the previous decision of the Board of Directors for extension of the services of the petitioner upto to the age of 62 years, was without jurisdiction and ab initio void and that in fact the Board of Directors, in their meeting held on 20‑1‑1983 had decided to re‑employee the petitioner for two years from the date of his completing the age of 60 years but the petitioner while recording its minutes had intentionally inserted the word "retirement" instead of "re‑employment" in them and got them signed from the Chairman of the Board of Directors, keeping him in dark for which reason the Board of Directors had corrected their said decision by treating the period of his employment in the bank after attaining the age of superannuation as re‑employment in pursuance whereof the impugned order was issued.

7. First of all, I proceed to take up and decide the preliminary objections taken with regard to the maintainability of this writ petition, by the learned counsel for the respondents. It has been contended by the learned counsel for the respondents that the respondent‑Bank being not a person performing functions in connection with the affairs of the Azad Jammu and Kashmir or Local Authority, no writ petition was competent against it and the only remedy available to the petitioner against the impugned order was to file a civil suit against it. The above argument is devoid of any force. The respondent‑Bank has been registered under the Co‑operative Societies Act, 1925 as adopted in Azad Kashmir and under its Bye Laws, the Chief Secretary, Secretary Finance, Secretary Co‑operative, Development Commissioner, Revenue Commissioner, Secretary Agriculture and Registrar Co‑operative are its ex officio members out of whom the Chief Secretary is also ex officio President and Chairman of the Board of Directors. Thus, it cannot be said that the respondent‑Bank does not perform functions in connection with the affairs of the Azad Jammu and Kashmir or Local Authority and as such is not amenable to the writ jurisdiction of this Court. As regards the contention of the learned counsel for the respondents that alternate remedy is available to the petitioner against the impugned order in a civil Court, it ha s equally no merits in it, as contrary to the above contention, under section 70‑A of the aforesaid Co‑operative Societies Act, the jurisdiction of the civil Court is barred to determine the validity of an order passed by a financing bank or Co‑operative Bank. This Court had already admitted and decided many writ petitions) filed against the dissolved Co‑operative Banks.

8. The other preliminary objection of the learned counsel for the respondents that the petitioner having accepted the impugned order had waived his right to challenge the same in a writ petition, is without any valid basis. No material has been placed on the record indicating that the petitioner had in fact accepted the order of his retirement in terms of impugned order by his conduct and later on the other hand, the perusal of Annexure 'G' filed by the petitioner with replication which is a copy of his pension bill, would show that he had claimed the amount of pension granted under the impugned order under protest reserving his right to challenge the same in the Court of Law.

9. For the foregoing reasons, the above preliminary objections of the learned counsel for the respondents are overruled.

10. After disposing of the above preliminary objections raised on behalf of the respondents, now I proceed to take up the case on merits. The learned counsel for the petitioner, in the first place, has assailed the impugned order on the ground that it amounts to cancellation or at least amendment of a previous decision of the Board of Directors made on 20‑1‑1983 whereby the petitioner was retained in the services of the Bank for a further period of two years from 19‑2‑1982 the date on which he completed the age of 60 years, which could not be undone as the said previous order had been carried into effect and the petitioner, under it, had not only completed the period of his extended service but had even after its expiry served the Bank for a further period of six months for which he was re‑employed. In this connection, it is further contended by him that the said previous decision had perfected as past and closed transaction and could not be re‑opened by way of impugned order not only on that account but also in view of the provisions made in Rule 1(b) of the Azad Jammu and Kashmir Government Co‑operative Bank (Staff) Service Rules, 1984.

11. In reply to the above contentions of the learned counsel for the petitioner, it has been argued by the learned counsel for the respondents that the Board of Directors in its meeting, dated 20‑1‑1983 had taken the decision for re‑employment of the petitioner for two years from the date he had attained the age of 60 years but the petitioner while recording minutes of the proceedings of the said meeting, had intentionally recorded in them his re‑employment as extension in service and got them signed deceitfully by the Chairman of the Board of Directors and that in any event, the previous decision of giving extension to the petitioner in the services of the respondent‑Bank was without jurisdiction and void ab initio because he stood retired on his attaining the age of 60 years in accordance with the service rules of the respondent‑Bank under which the Board of Directors had no authority to extend his services beyond the above age of his retirement.

12. After giving my due consideration to the above arguments addressed at the Bar, in the light of the record of the case and the law applicable to it, I am of the view, that the impugned order have had the effect of cancelling or, at least, amending the previous decision of the Board of Directors, dated 20‑1‑1983 whereby the services of the petitioner were extended in the respondent‑Bank for two years, from the date of his completing the age of 60 years and that the respondent-- Bank or Board of Directors had no powers to cancel or amend the same.

13. The bare reading of the copy of extract of the proceedings of the meeting of the Board of Directors held on 20‑1‑1983 filed as Annexure 'A' with the writ petition, would show that the services of the petitioner who had continued to render services in the Bank even after completing 60 years age, was given extension in service for two years upto his attaining the age of 62 years on the ground of non‑existence of any service Rules of the respondent‑Bank prescribing age of retirement of its employees. The contention of the respondents, as taken in the written statement and also repeated by the counsel in their arguments that in the said meeting, the decision was taken to re‑employee the petitioner for two years after his attaining the age of 60 years, but the petitioner while recording its minutes has inserted the word "extension" instead of "re‑employment" in them and got them deceitfully signed from the Chairman of the Board of Directors, is not supported by any evidence on the record. No material has been placed on the record to show of the minutes of the meeting in question were either recorded by the petitioner and got signed by him from the Chairman of the Board of Directors or it was his duty to record such minutes in the performance of his official functions. Such an evidence could easily be produced by the respondents from the official record of the Bank. Thus, when there is no evidence that it was the petitioner who had recorded the minutes of the proceeding under discussion or got them signed from the Chairman of the Board of Directors, the above allegation of his recording the decision of his retirement as that of extension in service in the minutes of the proceedings of the meeting of the Board of Directors, does not appear to have any basis and is not worthy of any consideration. Not only in the aforesaid minutes, the decision to extend the service of the petitioner is recorded but in the subsequent official record of the bank also the services of the petitioner are recorded to have been extended. In Annexures 'B' and 'C' which are the copies of resolutions adopted in the meetings of the Board of Directors of the Bank on 3‑3‑1984 and 16‑2‑1985, respectively, it is clearly mentioned that the petitioner was given extension in service upto 18‑2‑1984. Had the decision to re‑employ the petitioner been inadvertently or deceitfully been recorded as extension in his service then in the subsequent minutes of the proceedings of the meeting of the Board of Directors, the same should not have been again recorded as that of extension in service but of his re‑employment. Even, otherwise, the presumption of correctness is attached to the minutes of the proceedings of the meeting of the Board of Directors as the same have been recorded in performance of official duties of the Bank.

14. Similarly, the alternative position taken by the respondents that under the Service Rules of the Bank, the petitioner stood automatically retired on the date he had completed his 60 years of age and consequently the decision of the Board of Directors for extension of his services in the Bank was without jurisdiction and void ab initio for which reason it cannot be made the basis for granting the relief prayed for in the present writ petition, is also without any substance. The learned counsel for the respondents have not referred to any such service Rules of the Bank prescribing the age of retirement of its employees. The perusal of the Annexures 'A', 'B', 'C' and 'E' would show that no service Rules of the Bank existed before making the same in 1984 and referred to in early part of the judgment, as in the said documents, it is clearly mentioned that no such Rules existed and it was due to their non‑existence that the petitioner continued to remain in service of the Bank even after attaining the age of 60 years and was first given extension in service and then re‑employed. Thus, when there was no Law or Rules prescribing the age of superannuation of the employees of the Bank at the relevant time, it cannot be contended that the petitioner had by operation of law retired on his completing the age of 60 years and as such the decision of the Board of Directors extending his services beyond the said date was ab initio void and unlawful. It is true that under Service Rules, 1984, an employee of the Bank shall retire on the day on which he attains his 60th birthday but these Rules cannot be given retrospective effect as regards the age of superannuation of such an employee.

15. In this view of the matter, the decision of the Board of Directors, for extension of the services of the petitioner, was perfectly valid, lawful and is an effective order as the Board of Directors is empowered to appoint the General Manager and other officers of the Bank.

16. After having come to the conclusion that the previous decision of the Board of Directors under which two years extension in service was granted to the petitioner, was competently made, the next question that arises for determination is as to whether the same could be subsequently cancelled or amended and fresh decision taken re‑employing the petitioner for the said period instead of treating it as extension in service. In the facts and circumstances of the case, the answer to the above question, in my view, is definitely in negative. Even if, it is assumed that the Board of Directors do possess the powers to rescind, alter or modify its previous decision under section 21 of the General Clauses Act or Rule of locus poenitentiae but such powers are not unlimited or unabridged but are subject to the condition that such a previous order has not been carried into effect and acted upon when it is sought to be cancelled or amended. If the previous order has been given effect to and a person in whose favour the same is made, has acquired a vested right under it then neither locus poenitentiae is left to rescind or alter it nor the provisions of section 21 of the General Clauses Act can be pressed into service. In support of the above view, there is long array of authorities of the superior Courts out of which following few may be referred to.

17. In "Ventakesh Yesheant Deapnande v. Emperor" A I R 1938 Nag. 513 where the question arose whether the Government could recall its previous unconditional order of remission of sentence to a prisoner, the Full Bench ruled that it could not do so as the same had become effective on account of the prisoner having become entitled to be released under it and that any locus poenitentiae was clearly at an end when the subsequent order amending it was passed. The above rule was approved in Shah Baz's case P L D 1956 F C 46, wherein, while upholding the order of the Government, cancelling its previous order of remission of sentence to a prisoner which had not become effective, made the following observations:‑--------

"Locus poenitentise in law refers to the power of receding till a decisive step is taken. If a decisive step is taken other considerations would arise, but if that step was yet to be taken, we see no reason to restrict the power to modify or cancel."

18. In 'Mahboob Rabbani v. Government of West Pakistan' P L D 1963 Lah. 53, the question which fell for determination was whether the early Notification, dated 10‑9‑1957, sanctioning the earned leave to a Professor of the College after his retirement from service was lawfully rescinded by subsequent Notification, dated 1‑6‑1959, it was held that the same could not be withdrawn or cancelled in exercise of power under section 21 of the General Clauses Act, inasmuch as the same had become effective and that the power under the aforesaid provisions of law could be exercised only if the order which is sought to be cancelled, had not been carried into effect.

19. Justice Anwarul Haq in a Full Bench case titled "Farid Khan v. State" P L D 1965 Pesh. 31, held that the test for determining whether there is locus poenitentiae or not is to ascertain whether a decisive step has been taken in pursuance of the earlier order which is sought to be recalled or rescinded; until that decisive step is taken, locus poenitentiae exists for the Government to recall or rescind that order. In a Division Bench case of this Court in Writ Petition No.20 of 1978, entitled "Habibullah Lone v. The State", it has been held that an order cannot be altered or rescinded if an immediate fixed right of present or future enjoyments has accrued to a party because such a right is a fixed right in contradiction of being expectant or contingent right. In the above case, under Government Order, dated 9‑2‑1976, the petitioner therein was sanctioned escalation in schedule rates on which he had carried out the contract for the construction of a road but subsequently, the Government vide its order, dated 21‑6‑1978, had cancelled it and also called upon the petitioner to refund certain amount which he had received under the aforesaid previous order. The writ petition was accepted and subsequent order of the Government cancelling its previous order was held to be without lawful authority on the ground that under the previous order, the petitioner had acquired a vested right and the same had also been given effect too, as the petitioner had received part of the amount payable under it. The Supreme Court of Azad Jammu and Kashmir, in the case of 'Sattar Muhammad v. Chief Conservator of Forests P L D 1980 S C (A J & K) 46 while discussing doctrine of locus poenitentiae, has held that an authority that has power to make an order, has also the power to undo it or retrace step subject to exception that where the order has taken legal effect and in pursuance thereof, certain rights have been created in favour of an individual such an order cannot be withdrawn or recalled to the detriment of those rights.

20. When the principle of law enunciated in the authorities referred to above and many others are applied to the facts of the present case, an inescapable conclusion to which one comes is that the Board of Directors had no power to cancel or amend its previous decision taken in its meeting held on 20‑1‑1983, extending the service of the petitioner in respondent‑Bank for two years from 19‑2‑1982 and instead retire him and treat the period of his service rendered by him after the said date as re‑employment. It is undisputed that the petitioner had not only completed the extended period of service under the early decision of the Board of Directors but even after that had served the Bank for a further period of six months for which he was re‑employed. Thus there remains no manner of doubt that the previous decision of the Board whereby the petitioner was allowed to remain in services of the respondent‑Bank for a period of two years, after his attaining the age of 60 years, had been acted upon and carried into effect when the subsequent decision amending the same was taken and under which the petitioner stood retired with effect from the date he completed the above age. Since under the previous decision of the Board of Directors, a decisive step had been taken and the petitioner had become entitled to count the period of his service rendered under it towards his pension and other retirement benefits, the same could not be rescinded or amended by their subsequent decision either in exercise of the powers under section 21 of the General Clauses Act or under the rule of locus poenitentiae. Even, otherwise, the previous decision of the Board of Directors could not be undone in view of the provisions of Rule 1(b) of the Azad Jammu and Kashmir Government Co‑operative Bank (Staff) Service Rules, 1984 which create a bar to the re‑opening of cases pertaining to the service matters of the employees of the Bank which already stood decided before the enforcement of the said Rules.

21. It has been next contended by the learned counsel for the petitioner that the order impugned in this writ petition is also unlawful inasmuch as the same has been made without giving an opportunity of being heard to the petitioner. The above contention has also much force in it. As said earlier, the previous decision of the Board of Directors made on 20‑1‑1983, had been carried into effect, as a result of which the petitioner had become entitled to all the privileges and benefits admissible to him under the Rules of the Bank for the services he had rendered in pursuance thereof. The subsequent decision of the Board of Directors having the effect of amending its above previous decision has adversely effected the rights of the petitioner as it would deprive him of all the benefits and rights which had accrued to him for the services rendered by him under the previous order. The impugned order has been made in pursuance of the subsequent decision of the Board of Directors referred to above and as such it could not be passed without observing the principle of natural justice embodied in the maxim, 'Audi Alteram Partem'. It is an admitted fact that the impugned order has been made without hearing the petitioner or giving him an opportunity of being heard, for which reason it is bad in law, having been made in violation of aforesaid principle of natural justice.

22. The upshot of the above discussion is that the Board of Directors had no power to rescind or amend its previous decision according to which the petitioner had been retained in the service of the Bank for a further period of two years from the date he had completed the age of sixty years, for the simple reason that it had been carried into effect and under the same, the petitioner had acquired vested rights.

23. For the foregoing reasons, the impugned order, dated 1‑1‑1986 which has proceeded on the basis of the subsequent illegal decision of the Board of Directors taken in its meeting held on 10‑8‑1985, is declared to have been made without lawful authority and of no legal effect and consequently it is set aside. The petitioner shall be entitled to all the service benefits admissible to him under the relevant Rules of the respondent‑Bank for the extended period of services rendered by him under the previous decision of the Board of Directors, dated 20‑1‑1983. The parties shad bear their own costs.

S.Q./291/A.H Petition allowed.

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