K.Vadivelu v. The Additional Registrar of Co-operative Societies

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED: 22.11.2010CORAM:THE HON`BLE MR.JUSTICE B.RAJENDRANWP.Nos. 15358 to 15360 of 2009andM.P.Nos.2,2 and 2 of 2009 and 1,1 and 1 of 2010K.Vadivelu.. Petitioner in WP.No.15358/2009S.Tharani Kumar.. Petitioner in WP.No.15359/2009V.Susila.. Petitioner in WP.No.15360/2009vs.1. The Additional Registrar of Co-operative Societies Chennai Region, Chennai - 182. The Deputy Registrar of Co-operative Societies (Credit) Kuralagam, Chennai -1083. The Management of the Central Excise Staff Co- operative Thrift and Credit Society Ltd., No.120, Nungambakkam High Road Chennai – 600 represented by its Special Officer.. Respondents in all WPsWrit petitions filed under Article 226 of the Constitutionof India praying for issuance of Writ of certiorarified mandamuscalling for the records on the file of the 1st respondent relatingto the impugned order in Revision Petition bearing No.15/2007RC.No.6804/207/C2 dated 17.6.2008 and quash the same andconsequently direct the 3rd respondent to continue to pay the salaryin accordance with resolution No.4 of the III respondent dated16.10.1997 and also refund the amount so far recovered from themonthly salary of the petitioner. For petitioners:Mr.Hari BabiFor R1 and R2:Mr.R.MuraliGovernment AdvocateFor R3:Mr.AbdulwahabC O M M O N O R D E R https://hcservices.ecourts.gov.in/hcservices/ By consent of both sides, the writ petitions themselves aretaken up for disposal.2.Since the issue involved in these writ petitionsis identical in nature, all the writ petitions are taken uptogether and common order is passed.3. The prayer in the writ petitions is for issuance ofWrit of certiorarified mandamus calling for the records on the fileof the 1st respondent relating to the impugned order in RevisionPetition bearing No.15/2007 RC.No.6804/207/C2 dated 17.6.2008 andquash the same and consequently direct the 3rd respondent tocontinue to pay the salary in accordance with resolution No.4 ofthe 3rd respondent dated 16.10.1997 and also refund the amount sofar recovered from the monthly salary of the petitioner. 4.The petitioners would contend that the Specialbylaws relating to the Employees Service condition of the Societyempowers the Board of Management to fix the pay scales. Pursuantto the representations made by the employees to the Management, theBoard of Directors in their resolution dated 20.11.1997 resolved toto refix the pay scales on par with the recommendations of the 5thPay Commission. Further, the society was financially sound and itis earning more than 2 crores and as much as the expenses is notover 2% to 3%, the revision made by the society was well withinthe norms. But subsequently, under Section 82 of the Act, theinvestigation was made and the report was filed pointing out thatthere are excess payment and ordered for recovery of amount andrevision of scale of pay with effect from 01.1.1996 as the revisedpay was not in accordance with the terms and conditions prescribedin G.O.Ms.No.89 dated 16.5.2000. Further the revised pay was alsonot approved by the Registrar and based on the report of theinvestigation, the impugned order of recovery was ordered. Eventhough the G.O.is applicable to all the employees in the societies,only about 475 societies could able to implement therecommendations because of the poor financial conditions. Sincethe society is a sound and financial society and that the totalexpenditure did not exceed the limit, the recovery is not correct.Hence, they have filed the writ petitions challenging the impugnedorder of recovery.5. The first respondent filed a detailed counter and alsovacate stay petition contending that the revision of scale of paywas not brought to the knowledge of the Registrar and his approvalwas not obtained by the society and, therefore, the Managementcould not have implemented the resolution relating to the revisionof pay. Since the pay revisions were not approved by the Registrar,it becomes illegal and objectionable. As irregularity was foundunder Section 82 of the Co-operative Societies Act, 1983, the stepswere taken by the Department to recover the excess payments videG.O.Ms.No.89 dated 16.5.2000. In fact, the Government, inG.O.Ms.No.89 dated 16.5.2000, ordered for adoption of the revisedpay scales as recommended by the Committee and issued suitable https://hcservices.ecourts.gov.in/hcservices/ instruction to the Registrar of Co-operative Societies to ensurethe proper implementation of the revision of pay scales in all theemployees co-operative societies. As there was a deviation, theaction was rightly initiated. The society is bound to adhere theinstruction of the Government. The third respondent Society hasobeyed the instruction of the Registrar with regard to therevision. Hence, there is no illegality in the action and if atall, if the petitioners are aggrieved, they should have approachedthe appropriate forum for redressal of grievance as provided underlaw. Further, the revision petition filed before the firstrespondent under Section 153 of the Act was heard and final ordershave been passed in accordance with law on 17.7.2008. 6. The third respondent also filed a counter in tune withthe counter filed by the first respondent.7. The only point for consideration in this writ petitionis as to whether the impugned order under which the recovery wasmade in respect of the salary, which is paid not in accordance withG.O.Ms.No.89 dated 16.5.2000, was valid under law?8. Before going to into the merits of the case, thelearned Government Pleader brought to the notice of this Court thedecision of the Division Bench of this Court in TAMIL NADU VATTAKOOTURAVU VEETU VASATHI SANGANGALIN ANAITHU PANIYALARGAL MADYASANGAM, REP.BY ITS GENERAL SECRETARY, R. RAGHAVENDRAN V. DEPUTYREGISTRAR OF CO-OPERATIVE SOCIETIES (HOUSING) CUDDALORE CIRCLE,CUDDALORE DISTRICT AND OTHERS (2008) 2 MLJ 385, wherein this Courtfollowing the earlier decision of the Division Bench of this Courtin TIRUCHIRAPPALLI HIRUTHAYAPURAM CO-OPERATIVE SOCIETIES,TIRUCHIRAPALLI ( 1992 – I – LLJ 747) has held as follows:"Impugned orders passed by the firstrespondent in pursuance of the directions issued bythe Registrar under Section 181 of the Act of 1983and by invoking Section 166 of the said Act werewell within the powers and jurisdiction of the firstrespondent. Appellant, not having challenged thedirections of the Registrar and so long as saiddirections remains in force, cannot be permitted tochallenge the consequential orders passed by thefirst respondent under Section 166 of the Act of1983 which were impugned in the writ petitions.Writ appeals are dismissed."From the above judgment, it is clear that the individual societiescannot enter into any settlement with regard to pay revisionwithout the approval of the registrar.9. In this case, it is very clearly admitted that therewas no approval by the registrar. Further, in identical matters,in SALEM, NAMAKKAL & ERODE DISTRICT TALUK CO-OPERATIVE HOUSINGSOCIETIES EMPLOYEES UNION AND OTHERS V. THE REGISTRAR OF CO-OPERATIVE SOCIETIES (HOUSING) AND OTHERS, the learned single judgeof this Court has held as follows: 16.However, this issue has been squarely gone into by a https://hcservices.ecourts.gov.in/hcservices/ division bench of this court in Tamil Nadu VattaKooturavu Veetu Vasathi Sangangalin Anaithu PaniyalargalMadya Sangam Vs. Deputy Registrar of CooperativeSocieties (Housing), Cuddalore Circle, and othersreported in 2008 (2) LLN 236. In that case, the divisionbench after referring to Tiruchirappalli HiruthayapuramCooperative Bank Employees union's case held that maynot be a good law after introduction of Rule 149 of theTamil Nadu Cooperative Societies Rules. The divisionbench also referred to the judgment of the Supreme Courtin Ghaziabad Zila Sahkari Bank Ltd. Vs. AdditionalLabour Commissioner and others reported in 2007 (4) LLN32 and in paragraph 16 held as follows:"16.In the light of the above factors, we areconvinced that the orders impugned in thewrit petitions issued by the first respondentdirecting the respective co-operativesocieties to cancel the settlements whichcame to be arrived in contravention of thedirections issued by the Registrar of the Co-operative Societies, dated 16 October 1997,issued under S.181 of the Act 1983 byinvoking S.166 of the Act 1983 are perfectlyjustified. We are also convinced that theDivision Bench decision in TiruchirapalliHiruthayapuram Co-operative Bank EmployeesUnion V. Joint Registrar of Co-operativeSocieties, Tiruchirapalli (vide supra), uponwhich heavy reliance was placed upon by theappellant does not in any way support thestand of the appellant. On the other hand, wecan only state that the subsequent directionissued by the Registrar of Co-operativeSocieties, dated 16 October 1997, by invokingthe powers vested in him under S.181 of theAct 1983 was validly made and the impugnedorders, dated 12 March 1999 and 8 April 1999,passed in pursuance of the said directions ofthe Registrar, dated 16 October 1997, as wellas by applying S.166 of the Act 1983 were allin tune with the observations made in theabove referred to Division Bench decision andtherefore, we do not find any scope tointerfere with the impugned orders. Moreover,so long as the directions issued by theRegistrar, dated 16 October 1997, under S.181of the Act 1983 remains in force, thesubsequent directions and the impugned ordersissued by the first respondent by invokingS.166 of the Act 1983 were well within thepowers and jurisdiction of the firstrespondent. " https://hcservices.ecourts.gov.in/hcservices/

17.Therefore, Mr.V.Ajoy Khose, learned counselcontended that denying wages which was already paid,would amount to infringement of Article 21 of theConstitution. Therefore, a writ will lie in respect ofconstitutional infringement. But, even that question wasconsidered by the Full Bench of this court in T.K.AnandaSayanan Vs. Joint Registrar, Co-operative Societies,Vellore Region, Vellore and another reported in 2007 (5)MLJ 637. In paragraph 16 of the said judgment, it wasobserved as follows:"16.For every alleged or imagined invasion ofhis rights, an employee of a co-operativesociety cannot move the writ Court on theground that his rights under Article 21 havebeen infringed. The effect of the SupremeCourt cases cited in K.Marappan V. DeputyRegistrar of Co-operative Societies, Namakkalcase (supra) and the propositions set down inK.Marappan V. Deputy Registrar of Co-operative Societies, Namakkal case (supra)cannot be set at naught merely by mentioningArticle 21, even if the order is illegal." 18.In the present case, the challenge is only to thecircular sent by the Registrar of Cooperative Societies(Housing) to various societies. As and when thesocieties take action in terms of the circular, theremedy for the union or workers is to raise anindustrial dispute and to allege all infringements ofsettlements or their right to get a particular wagescale irrespective of whether it was within 1% or 3% ofinterest margin as permitted by the Registrar. Time andagain, this court has held that those non statutorydirections are not binding on industrial adjudicatorsand in a regularly raised dispute, such industrialadjudicating authorities like Labour Court/IndustrialTribunal can go into the question of validity of nonstatutory circulars and also determine the wage in thelight of relevant industrial law, such as payingcapacity of employer, region-cum-industry principle andother relevant considerations. Merely because Section 9-A is infringed that will not enable them to approachthis court under Article 226 of the Constitution ascooperative societies were held to be not a State withinthe meaning of Article 12 of the Constitution, even ifthey were presided by Special Officers. At the maximum,issuance of a notice under Section 9-A of the I.D. Actwill enable parties to approach the industrialadjudicating machinery as held by the Supreme Court inThe Life Insurance Corporation of India Vs. D.J.Bahadurreported in AIR 1980 SC 2181. https://hcservices.ecourts.gov.in/hcservices/

19.In view of the such remedies available to theparties and in the light of the binding precedent inMarappan's case (cited supra) and the division benchjudgment in 2008 (2) LLN 236, all the writ petitionswill stand dismissed. No costs. Consequently, connectedmiscellaneous petitions will stand dismissed. 10. In P.RAMAN V. THE JOINT REGISTRAR OF CO-OP SOCIETIESCADRE AUTHORITY IN RESPECT OF PRIMARY AGRICULTURAL CO-OPERATIVEBANK LTD AND ANOTHER, (CDJ 2010 MHC 2595), the learned single judgehas held as follows:7. Learned counsel appearing for the 2nd respondentsubmitted that in view of wrong calculation, a hugemoney belonging to the Co-operative Societies has beenwrongly paid and therefore, the Deputy Registrar of Co-operative Societies has ordered for enquiry underSection 87 of Tamil Nadu Co-operative Societies Act,1983. Based on the order passed by the DeputyRegistrar of Co-operative Societies, an enquiry wasconducted and the enquiry officer has gone into thequestion whether the petitioner's backwages should beworked out on the basis of the 18(1) settlement or onthe basis of G.O.Ms.No.131. In the final result, theenquiry officer concluded that the backwages were overpaid to the petitioner, by wrongly calculating on thebasis of the 18(1) settlement, when the backwages wereto be calculated only in terms of G.O.Ms.No.131, dated04.06.1999. Therefore, the stand taken by therespondents that they have not in any way attempted toreduce the backwages, cannot be rejected, for thesimple reason that the petitioner has admittedlyreceived his salary of Rs.6,932/- for the month ofDecember, 2004 in terms of G.O.Ms.No.131. Therefore,the 2nd respondent has placed the then special Officerunder suspension for wrongly calculating the backwagesof the petitioner on the basis of the 18(1) Settlement.Further, the enquiry under Section 87 of Tamil Nadu Co-operative Societies Act, 1983, was conducted and theorder has also been passed by the Deputy Registrar ofthe Co-operative Societies. The wrong payment ofbackwages made to the petitioner, which is not in termsof G.O.Ms.No.131, has been properly gone into by theSpecial Officer, who was subsequently appointed, basingon the enquiry officer's report ordered that a sum ofRs.10,76,559.75/- has to be recovered from thepetitioner as the same has been over paid to him.Therefore, the order passed by the respondents that thepetitioner is entitled to receive his salary on thebasis of G.O.Ms.No.131, cannot be found fault with. 8. In a similar matter in writ petition, W.P.No.8692/05, by order dated 15th March, 2010, I havealready dismissed the writ petition, raising the same https://hcservices.ecourts.gov.in/hcservices/ issue whether the scale of pay payable to the employeesof the Cooperative Societies should be paid on thebasis of 18(1) settlement or on the basis ofG.O.Ms.No.131, dated 04.06.1999, by holding that thescale of pay has to be paid on the basis of G.O. No.131dated 4.06.1999 and not as per 18 (1) settlement. As the legal position is already settled, Ineed not cite any reference and in the event of anyconflict between law and by-law or between agreementand Government Order, the Government Order inG.O.Ms.No.131 dated 04.06.1999 passed by the Governmentwill override the settlement reached under Section 18(1) of the Act.9. Counsel appearing on both sides informedthat surcharge proceedings were initiated u/s 87 of theTamil Nadu Co-operative Societies Act against severalco-directors of the same co-operative society forhaving paid salary to several employees violating G.O.No.131 dated 4.6.1999 by paying increased salary on thebasis of 18 (1) settlement. The said writ petitionsfiled by the other co-directors of the same co-operative society were dismissed by this Court. Inview of this, the present writ petition also is notlegally maintainable.10. In result, the writ petition is dismissed.No Costs. Consequently, connected MP.No.1 of 2008 isclosed."11. Therefore, following the above judgments, the presentwrit petitions challenging the order of recovery is notmaintainable. Hence, the writ petitions are dismissed. No costs.Consequently, connected Miscellaneous petitions are closed.Sd/ Asst.Registrar/true copy/ Sub Asst.RegistrargaTo1. The Additional Registrar of Co-operative Societies Chennai Region, Chennai - 182. The Deputy Registrar of Co-operative Societies (Credit) Kuralagam, Chennai -108 https://hcservices.ecourts.gov.in/hcservices/

3. The Special Officer, The Management of the Central Excise Staff Co- operative Thrift and Credit Society Ltd., No.120, Nungambakkam High Road Chennai.1 cc To Mr.B.Haribabu, Advocate, SR.837491 cc To The Government Pleader, SR.83292WP.Nos. 15358 to 15360 of 2009MBS (CO)RH (20.12.10)