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Issues involved:
The appeal challenges the constitutionality of Rule 5 of the Orissa Insurance Co-operative Society Ltd. Service Rules, impugning it as void under Article 14 of the Constitution of India. Details of the Judgment: Issue 1: Constitutionality of Rule 5 The appellant's service was terminated under Rule 5 without conducting an inquiry or giving an opportunity, based on charges that were subsequently dropped. The appellant argued that Rule 5 is ultra vires of Article 14. The respondent contended that Rule 5 provides guidelines for termination, with objective consideration by the Board of Directors. The Court held that Rule 5 is not arbitrary or void, as it allows for a policy decision based on the need for the employee's service. Issue 2: Termination of Service The Board of Management did not abolish the appellant's post but terminated his service due to loss of confidence. The Court found the termination illegal as Rule 8 for misconduct was available but not utilized. The Court directed the respondent to pay compensation of Rs. 1,00,000 to the appellant instead of reinstatement, considering the circumstances since 1973. Conclusion: The Court allowed the appeal, directing the respondent to pay compensation to the appellant. It emphasized the need for the respondent to revise its rules in line with constitutional principles. The intervention application was dismissed, and the appeal was allowed without costs.
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