GOPAKUMAR.J v. THE GENERAL MANAGER THIRUVANANTHAPURAM URBAN CO-OPERATIVE BANK LTD

APPENDIX(WPC NO.16914/2012) PETITIONER'S EXHIBITS EXT.P1A TRUE COPY OF THE LOAN APPLICATION SUBMITTED BY MR.SUBHASH.EXT.P2A TRUE COPY OF THE SALARY RECOVERY UNDERTAKING ISSUED BY THEFIRST RESPONDENT.EXT.P3A TRUE COPY OF THE BOND EXECUTED DATED 7.5.1999 TO AVAIL THELOAN.EXT.P4A TRUE COPY OF THE LETTER ISSUED BY THE BANK DATED27.7.2011.EXT.P5A TRUE COPY OF THE JUDGMENT REPORTED IN 2009(4)KHC 185. RESPONDENTS' EXHIBITS -NILTRUE COPYpmsP.A. to Judge HARUN-UL-RASHID, J.------------------------W.P.(C).No.16914 Of 2012----------------------Dated this the 27th day of November, 2012.J U D G M E N TThe writ petition is filed seeking a direction directing the 1strespondent to pay the gratuity to the petitioner amounting toRs.5,94,552/- with interest from 28.6.2011 @ 14% being paid tofixed deposit and for other incidental reliefs. 2.The petitioner retired from the service of the 1strespondent bank on 31.5.2011 after completing 33 years inservice. It is submitted that at the time of retirement, the LifeInsurance Corporation of India paid Rs.5,94,552/- towardsgratuity on 28.6.2011. It is pointed out that while the petitionerwas in service the gratuity limit payable to the employees wasraised to Rs.10 Lakhs with effect from 24.5.2010. It is said thatgratuity amount disbursed by the LIC was credited in the accountof the bank, but not paid to the petitioner on the ground that thepetitioner stood as a surety in a loan transaction of Subhash inThiruvananthapuram Service Co-operative Bank. The said loanamount was not paid in time by the principal lonee and thereforesome amount was recovered from the salary of the petitioner. It ::2::W.P.(C).No.16914 Of 2012is pointed out that since the retirement of the petitioner, recoveryfrom salary was discontinued. Now the gratuity amount due tothe petitioner was withheld on the basis of Ext.P4communication. 3.The 1st respondent filed a counter affidavit. It iscontended that the remedy available to the petitioner is toapproach the authority under the Payment of Gratuity Act, if hehas a case that payment of gratuity has not been paid, that thepetitioner had availed a short term loan, STL No.73, from themain branch of the 1st respondent amounting to Rs.66,708/- andanother loan of Rs.32,507/- from the Trivandrum Urban BankEmployees Society. It is pointed out that the petitioner closedboth loans on 4.9.2012 and 1.8.2012 respectively, after filing thiswrit petition. It is also pointed out that he stood as a surety toloan No.HPL 1959 in the Thiruvananthapuram Service Co-operative Bank Ltd. in which an outstanding amount ofRs.1,18,784/- is due to the said bank. On receipt ofcommunication, prior to the retirement of the petitioner,requesting to withhold the gratuity amount of the petitioner fromthe said bank, two notices were sent to the petitioner by speed ::3::W.P.(C).No.16914 Of 2012post requesting to clear the liability and to collect the gratuityamount of Rs.5,94,552/-. It is said that both notices werereturned with the endorsement 'returned unclaimed'. It ispointed out that the petitioner has not cleared the liability tilldate and has not approached the 1st respondent bank fordisbursement of gratuity amount. It is submitted that thegratuity amount of Rs.5,94,552/- has been credited by the 1strespondent in a suspense account on 28.6.2011. The bank alsointimated the petitioner to collect the gratuity amount afterclosing the outstanding liability on 14.7.2011. 4.Thiruvananthapuram Service Co-operative Bank wasimpleaded as the additional 3rd respondent. The additional 3rdrespondent filed a counter affidavit. It is pointed out in thecounter affidavit that the petitioner is a surety in a Hire Purchaseloan transaction bearing No.HPL 2291/1999 with the 3rdrespondent bank and the bank has sanctioned the loan solely onthe basis of the undertaking of the sureties to the effect that theyare jointly and severally liable to the loan transaction along withthe principal debtor and will pay back the loan amount in casethe principal debtor has committed default in the repayment of ::4::W.P.(C).No.16914 Of 2012the loan amount. It is also averred that the employer of thesureties also undertaken in their salary confirmation letter thatthey will effect the recovery from salary as required underSection 37 of the Kerala Co-operative Societies Act. It is statedthat the Hire Purchase loan was sanctioned solely on the securityof the salary certificates of the sureties. The petitioner and othersurety have produced their salary certificates for the security ofthe loan amount. It is also said that the salary certificate wassent to the 1st respondent bank for confirmation and afterconfirmation loan was sanctioned on 27.3.1999. It is said thatfrom the very beginning the principal debtor has become adefaulter in repaying the loan amount. Therefore, the 3rdrespondent bank by letter dated 8.8.2000, marked as Ext.R3(a),requested the employer of the sureties to effect recovery fromthe salary of the sureties. Though reminders are issued no salaryrecovery was effected till 2010. It is said that it was due to thehigh hand influence of the sureties over their employer. It is saidthat as on 31.8.2012 an amount of Rs.1,30,292/- is due in theloan account. Ext.R3(c) is the copy of the demand notice dated27.1.2006 issued to the sureties and principal debtor, including ::5::W.P.(C).No.16914 Of 2012the petitioner, intimating them that an amount of Rs.81,990/- isoutstanding in the loan account and directed to close the loantransaction. The 3rd respondent thereafter also issued manyrequests to the 1st respondent to effect salary recovery from thesalary of the petitioner and other surety since the loan wassanctioned solely on the security of the salary certificate of thesureties and no collateral security of any kind is obtained fromthe principal debtor for the loan. It is also submitted by the 3rdrespondent that instead of remitting the amount the petitionerand the other surety evaded payment and thereby acted againstthe loan undertaking. The 3rd respondent also issued a notice on6.4.2011, marked as Ext.R3(f), to the 1st respondent stating thatthe petitioner is indebted a sum of Rs.1,18,013/-, that he isgoing to retire on 31.5.2011 and therefore, requested to recoverthe said amount from the pensionary benefits of the petitionerand remit the same to the bank. On 18.5.2011, another requestwas issued stating that the amount outstanding in the loanaccount No.HPL 2291 is Rs.1,18,784/- and requested to recoverthe said amount from the pensionary benefits. It is furtherrequested that the retirement benefits of the petitioner may be ::6::W.P.(C).No.16914 Of 2012disbursed only after producing a NOC from the 3rd respondentbank to that extent. Ext.R3(g) is the copy of the communicationdated 18.5.2011 issued to the 1st respondent. It is contended bythe additional 3rd respondent that in the circumstance, thepetitioner cannot evade from his liability to pay off the debt aftertaking out a contention that the DCRG amount payable under thePayment of Gratuity Act is not liable to be attached or recoveredsince he has successfully evaded payment to the loan accountwhich was sanctioned solely on the basis of the salary certificatesof the sureties and avoided which was requested by the petitionerwhile in service after making his influence over his employer.5.Going by the averments in the counter affidavits filedby the 1st respondent and additional 3rd respondent, it is clearthat the petitioner is indebted a sum of Rs.1,18,784/- as on18.5.2011. Several requests were made by the additional 3rdrespondent to the bank stating that the retirement benefits of thepetitioner may be disbursed only after recovering all the amountsdue from the petitioner. Till date the petitioner has not clearedthe liability and has not approached the 1st respondent bank fordisbursement of the gratuity amount. In the circumstance, the ::7::W.P.(C).No.16914 Of 2012petitioner has a duty to close the outstanding liability andthereafter collect the retirement benefits including gratuity. In the facts and circumstances, the writ petition is disposedof directing the 1st respondent to pay the gratuity amount due tothe petitioner on condition that the petitioner shall remit theamounts due to the 1st respondent and the additional 3rdrespondent (Thiruvananthapuram Service Co-operative BankLtd.No.131). The gratuity amount shall be disbursed only afterthe petitioner closing the entire liability. The above directions areissued without prejudice to the creditor bank to proceed againstthe petitioner, borrower and co-sureties. HARUN-UL-RASHID, Judge.bkn/-