HC dismisses plea of former chairman-cum-MD J&K Bank

J&K High Court on Wednesday dismissed as “not maintainable” a plea by Parvez Ahmad Negroo against his removal as Chairman & Managing Director of J&K Bank.

In his petition, Nengroo had challenged communication dated 08.06.2019 addressed by the Additional Secretary, Finance Department, of the erstwhile J&K State, to the Company Secretary, J&K Bank Limited, by virtue of which he had ceased to be the Chairman-cum-Managing Director of the J&K Bank.

Through the same communication, R K Chibber was appointed as the interim Chairman-cum-Managing Director of the Bank.

While dismissing the petition at its threshold, a bench of Justice Ali Muhammad Magrey, held that the nomination of the petitioner as Director on the Board and his appointment as Chairman-cum-Chief Executive Officer of the Bank was “contractual in nature and not governed by any statute or the service conditions ordinarily applicable to the employees of the Bank”.

The court, however, left the petitioner free to approach the civil court for seeking redressal of his contractual dispute(s) with the Bank.

Citing law, the court held that “contractual duties are enforceable as matters of private law by ordinary contractual remedies such as damages, injunction, specific performance and declaration”.

It said: “In terms of Rule/Regulation 2(k) and 2(l) of the Pension Regulations, the petitioner is deemed to have retired from the service of the Bank with effect from 06.10.2016, therefore, his tenure as being the Chairman and CEO of the Bank is not governed by the Service Rules of the Bank”.

Notably, the communication dated 09.07.2019 had conveyed to the petitioner that he was deemed to have retired from the service of the Bank with effect from 06.10.2016.

“Since all the other reliefs prayed for by the petitioner in this petition are relatable to the two prayers for issue of the writs of Certiorari to quash the two communications dated 08.06.2019 and 09.07.2019, this petition for these reliefs as well would not survive before this Court in its extraordinary writ jurisdiction” the court said.

“If the petitioner is deemed to have retired as an employee of the Bank with effect from 06.10.2016, the date he was nominated as the Government Director on the Board and appointed as Chairman of the Bank, the question is what would his relationship with the Bank be during the period he would remain or remained as nominated Director on the Board of the Bank and its Chairman-cum-Chief Executive Officer, especially so when, admittedly, this period is to be excluded while computing the qualifying service?” the Court asked.

The court said that in the instant case the petitioner had obviously the choice to decline the nomination as Director on the Board and to be the Chairman and CEO of the Bank.

“But he accepted the position and thereby, by operation of the relevant Regulation(s), of his own volition agreed to be deemed to have retired from the employment of the Bank. He, thus, having seceded his relationship with the Bank as its employee, the period during which he remained as nominated Director on the Board and Chairman and CEO of the Bank would not constitute employment to be governed by the service conditions of the Bank”, it said.

“If that be so, as it actually is, the only relationship of the petitioner with the Bank while being a Government Director on the Board and Chairman/CEO of the Bank cannot but be contractual in nature”.

With regard to the contention that concept of deemed retirement has no relation with one’s service and is even otherwise not applicable to Chairman/CEO and whole-time Directors who are serving employees of the Bank, the court said: “One thing has to be borne in mind that neither the position of Director, nor of the Chairman/CEO or the Managing Director are promotional posts in the service of the Bank”.

“Nomination of the petitioner as Government Director on the Board or his appointment as Chairman/CEO of the Board of the Bank is not an elevation in the sense of promotion as construed in ordinary service parlance,” it said.