IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 22.11.2010 CORAM: THE HON`BLE MR.JUSTICE B.RAJENDRAN WP.Nos. 15358 to 15360 of 2009 and M.P.Nos.2,2 and 2 of 2009 and 1,1 and 1 of 2010 K.Vadivelu .. Petitioner in WP.No.15358/2009 S.Tharani Kumar .. Petitioner in WP.No.15359/2009 V.Susila .. Petitioner in WP.No.15360/2009 vs. 1. The Additional Registrar of Co-operative Societies Chennai Region, Chennai - 18 2. The Deputy Registrar of Co-operative Societies (Credit) Kuralagam, Chennai -108 3. 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 WPs
Writ petitions filed under Article 226 of the Constitution of India praying for issuance of Writ of certiorarified mandamus calling for the records on the file of the 1st respondent relating to the impugned order in Revision Petition bearing No.15/2007 RC.No.6804/207/C2 dated 17.6.2008 and quash the same and consequently direct the 3rd respondent to continue to pay the salary in accordance with resolution No.4 of the III respondent dated 16.10.1997 and also refund the amount so far recovered from the monthly salary of the petitioner.
For petitioners : Mr.Hari Babi
For R1 and R2 : Mr.R.Murali
For R3 : Mr.Abdulwahab
C O M M O N O R D E R
By consent of both sides, the writ petitions themselves are taken up for disposal.
2. Since the issue involved in these writ petitions is identical in nature, all the writ petitions are taken up together and common order is passed.
3. The prayer in the writ petitions is for issuance of Writ of certiorarified mandamus calling for the records on the file of the 1st respondent relating to the impugned order in Revision Petition bearing No.15/2007 RC.No.6804/207/C2 dated 17.6.2008 and quash the same and consequently direct the 3rd respondent to continue to pay the salary in accordance with resolution No.4 of the 3rd respondent dated 16.10.1997 and also refund the amount so far recovered from the monthly salary of the petitioner.
4. The petitioners would contend that the Special bylaws relating to the Employees Service condition of the Society empowers the Board of Management to fix the pay scales. Pursuant to the representations made by the employees to the Management, the Board of Directors in their resolution dated 20.11.1997 resolved to to refix the pay scales on par with the recommendations of the 5th Pay Commission. Further, the society was financially sound and it is earning more than 2 crores and as much as the expenses is not over 2% to 3%, the revision made by the society was well within the norms. But subsequently, under Section 82 of the Act, the investigation was made and the report was filed pointing out that there are excess payment and ordered for recovery of amount and revision of scale of pay with effect from 01.1.1996 as the revised pay was not in accordance with the terms and conditions prescribed in G.O.Ms.No.89 dated 16.5.2000. Further the revised pay was also not approved by the Registrar and based on the report of the investigation, the impugned order of recovery was ordered. Even though the G.O.is applicable to all the employees in the societies, only about 475 societies could able to implement the recommendations because of the poor financial conditions. Since the society is a sound and financial society and that the total expenditure did not exceed the limit, the recovery is not correct. Hence, they have filed the writ petitions challenging the impugned order of recovery.
5. The first respondent filed a detailed counter and also vacate stay petition contending that the revision of scale of pay was not brought to the knowledge of the Registrar and his approval was not obtained by the society and, therefore, the Management could not have implemented the resolution relating to the revision of pay. Since the pay revisions were not approved by the Registrar, it becomes illegal and objectionable. As irregularity was found under Section 82 of the Co-operative Societies Act, 1983, the steps were taken by the Department to recover the excess payments vide G.O.Ms.No.89 dated 16.5.2000. In fact, the Government, in G.O.Ms.No.89 dated 16.5.2000, ordered for adoption of the revised pay scales as recommended by the Committee and issued suitable instruction to the Registrar of Co-operative Societies to ensure the proper implementation of the revision of pay scales in all the employees co-operative societies. As there was a deviation, the action was rightly initiated. The society is bound to adhere the instruction of the Government. The third respondent Society has obeyed the instruction of the Registrar with regard to the revision. Hence, there is no illegality in the action and if at all, if the petitioners are aggrieved, they should have approached the appropriate forum for redressal of grievance as provided under law. Further, the revision petition filed before the first respondent under Section 153 of the Act was heard and final orders have been passed in accordance with law on 17.7.2008.
6. The third respondent also filed a counter in tune with the counter filed by the first respondent.
7. The only point for consideration in this writ petition is as to whether the impugned order under which the recovery was made in respect of the salary, which is paid not in accordance with G.O.Ms.No.89 dated 16.5.2000, was valid under law?
8. Before going to into the merits of the case, the learned Government Pleader brought to the notice of this Court the decision of the Division Bench of this Court in TAMIL NADU VATTA KOOTURAVU VEETU VASATHI SANGANGALIN ANAITHU PANIYALARGAL MADYA SANGAM, REP.BY ITS GENERAL SECRETARY, R. RAGHAVENDRAN V. DEPUTY REGISTRAR OF CO-OPERATIVE SOCIETIES (HOUSING) CUDDALORE CIRCLE, CUDDALORE DISTRICT AND OTHERS (2008) 2 MLJ 385, wherein this Court following the earlier decision of the Division Bench of this Court in TIRUCHIRAPPALLI HIRUTHAYAPURAM CO-OPERATIVE SOCIETIES, TIRUCHIRAPALLI ( 1992 I LLJ 747) has held as follows:
“Impugned orders passed by the first respondent in pursuance of the directions issued by the Registrar under Section 181 of the Act of 1983 and by invoking Section 166 of the said Act were well within the powers and jurisdiction of the first respondent. Appellant, not having challenged the directions of the Registrar and so long as said directions remains in force, cannot be permitted to challenge the consequential orders passed by the first respondent under Section 166 of the Act of 1983 which were impugned in the writ petitions. Writ appeals are dismissed.”
From the above judgment, it is clear that the individual societies cannot enter into any settlement with regard to pay revision without the approval of the registrar.
9. In this case, it is very clearly admitted that there was no approval by the registrar. Further, in identical matters, in SALEM, NAMAKKAL & ERODE DISTRICT TALUK CO-OPERATIVE HOUSING SOCIETIES EMPLOYEES UNION AND OTHERS V. THE REGISTRAR OF CO-OPERATIVE SOCIETIES (HOUSING) AND OTHERS, the learned single judge of this Court has held as follows:
16.However, this issue has been squarely gone into by a division bench of this court in Tamil Nadu Vatta Kooturavu Veetu Vasathi Sangangalin Anaithu Paniyalargal Madya Sangam Vs. Deputy Registrar of Cooperative Societies (Housing), Cuddalore Circle, and others reported in 2008 (2) LLN 236. In that case, the division bench after referring to Tiruchirappalli Hiruthayapuram Cooperative Bank Employees union’s case held that may not be a good law after introduction of Rule 149 of the Tamil Nadu Cooperative Societies Rules. The division bench also referred to the judgment of the Supreme Court in Ghaziabad Zila Sahkari Bank Ltd. Vs. Additional Labour Commissioner and others reported in 2007 (4) LLN 32 and in paragraph 16 held as follows:
“16.In the light of the above factors, we are convinced that the orders impugned in the writ petitions issued by the first respondent directing the respective co-operative societies to cancel the settlements which came to be arrived in contravention of the directions issued by the Registrar of the Co-operative Societies, dated 16 October 1997, issued under S.181 of the Act 1983 by invoking S.166 of the Act 1983 are perfectly justified. We are also convinced that the Division Bench decision in Tiruchirapalli Hiruthayapuram Co-operative Bank Employees Union V. Joint Registrar of Co-operative Societies, Tiruchirapalli (vide supra), upon which heavy reliance was placed upon by the appellant does not in any way support the stand of the appellant. On the other hand, we can only state that the subsequent direction issued by the Registrar of Co-operative Societies, dated 16 October 1997, by invoking the powers vested in him under S.181 of the Act 1983 was validly made and the impugned orders, dated 12 March 1999 and 8 April 1999, passed in pursuance of the said directions of the Registrar, dated 16 October 1997, as well as by applying S.166 of the Act 1983 were all in tune with the observations made in the above referred to Division Bench decision and therefore, we do not find any scope to interfere with the impugned orders. Moreover, so long as the directions issued by the Registrar, dated 16 October 1997, under S.181 of the Act 1983 remains in force, the subsequent directions and the impugned orders issued by the first respondent by invoking S.166 of the Act 1983 were well within the powers and jurisdiction of the first respondent. ”
17.Therefore, Mr.V.Ajoy Khose, learned counsel contended that denying wages which was already paid, would amount to infringement of Article 21 of the Constitution. Therefore, a writ will lie in respect of constitutional infringement. But, even that question was considered by the Full Bench of this court in T.K.Ananda Sayanan 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 was observed as follows:
“16.For every alleged or imagined invasion of his rights, an employee of a co-operative society cannot move the writ Court on the ground that his rights under Article 21 have been infringed. The effect of the Supreme Court cases cited in K.Marappan V. Deputy Registrar of Co-operative Societies, Namakkal case (supra) and the propositions set down in K.Marappan V. Deputy Registrar of Co-operative Societies, Namakkal case (supra) cannot be set at naught merely by mentioning Article 21, even if the order is illegal.”
18.In the present case, the challenge is only to the circular sent by the Registrar of Cooperative Societies (Housing) to various societies. As and when the societies take action in terms of the circular, the remedy for the union or workers is to raise an industrial dispute and to allege all infringements of settlements or their right to get a particular wage scale irrespective of whether it was within 1% or 3% of interest margin as permitted by the Registrar. Time and again, this court has held that those non statutory directions are not binding on industrial adjudicators and in a regularly raised dispute, such industrial adjudicating authorities like Labour Court/Industrial Tribunal can go into the question of validity of non statutory circulars and also determine the wage in the light of relevant industrial law, such as paying capacity of employer, region-cum-industry principle and other relevant considerations. Merely because Section 9-A is infringed that will not enable them to approach this court under Article 226 of the Constitution as cooperative societies were held to be not a State within the meaning of Article 12 of the Constitution, even if they were presided by Special Officers. At the maximum, issuance of a notice under Section 9-A of the I.D. Act will enable parties to approach the industrial adjudicating machinery as held by the Supreme Court in The Life Insurance Corporation of India Vs. D.J.Bahadur reported in AIR 1980 SC 2181.
19.In view of the such remedies available to the parties and in the light of the binding precedent in Marappan’s case (cited supra) and the division bench judgment in 2008 (2) LLN 236, all the writ petitions will stand dismissed. No costs. Consequently, connected miscellaneous petitions will stand dismissed.
10. In P.RAMAN V. THE JOINT REGISTRAR OF CO-OP SOCIETIES CADRE AUTHORITY IN RESPECT OF PRIMARY AGRICULTURAL CO-OPERATIVE BANK LTD AND ANOTHER, (CDJ 2010 MHC 2595), the learned single judge has held as follows:
7. Learned counsel appearing for the 2nd respondent submitted that in view of wrong calculation, a huge money belonging to the Co-operative Societies has been wrongly paid and therefore, the Deputy Registrar of Co-operative Societies has ordered for enquiry under Section 87 of Tamil Nadu Co-operative Societies Act, 1983. Based on the order passed by the Deputy Registrar of Co-operative Societies, an enquiry was conducted and the enquiry officer has gone into the question whether the petitioner’s backwages should be worked out on the basis of the 18(1) settlement or on the basis of G.O.Ms.No.131. In the final result, the enquiry officer concluded that the backwages were over paid to the petitioner, by wrongly calculating on the basis of the 18(1) settlement, when the backwages were to be calculated only in terms of G.O.Ms.No.131, dated 04.06.1999. Therefore, the stand taken by the respondents that they have not in any way attempted to reduce the backwages, cannot be rejected, for the simple reason that the petitioner has admittedly received his salary of Rs.6,932/- for the month of December, 2004 in terms of G.O.Ms.No.131. Therefore, the 2nd respondent has placed the then special Officer under suspension for wrongly calculating the backwages of 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 the order has also been passed by the Deputy Registrar of the Co-operative Societies. The wrong payment of backwages made to the petitioner, which is not in terms of G.O.Ms.No.131, has been properly gone into by the Special Officer, who was subsequently appointed, basing on the enquiry officer’s report ordered that a sum of Rs.10,76,559.75/- has to be recovered from the petitioner as the same has been over paid to him. Therefore, the order passed by the respondents that the petitioner is entitled to receive his salary on the basis 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 have already dismissed the writ petition, raising the same issue whether the scale of pay payable to the employees of the Cooperative Societies should be paid on the basis of 18(1) settlement or on the basis of G.O.Ms.No.131, dated 04.06.1999, by holding that the scale of pay has to be paid on the basis of G.O. No.131 dated 4.06.1999 and not as per 18 (1) settlement.
As the legal position is already settled, I need not cite any reference and in the event of any conflict between law and by-law or between agreement and Government Order, the Government Order in G.O.Ms.No.131 dated 04.06.1999 passed by the Government will override the settlement reached under Section 18(1) of the Act.
9. Counsel appearing on both sides informed that surcharge proceedings were initiated u/s 87 of the Tamil Nadu Co-operative Societies Act against several co-directors of the same co-operative society for having paid salary to several employees violating G.O. No.131 dated 4.6.1999 by paying increased salary on the basis of 18 (1) settlement. The said writ petitions filed by the other co-directors of the same co-operative society were dismissed by this Court. In view of this, the present writ petition also is not legally maintainable.
10. In result, the writ petition is dismissed. No Costs. Consequently, connected MP.No.1 of 2008 is closed.”
11. Therefore, following the above judgments, the present writ petitions challenging the order of recovery is not maintainable. Hence, the writ petitions are dismissed. No costs. Consequently, connected Miscellaneous petitions are closed.
1. The Additional Registrar of Co-operative Societies
Chennai Region, Chennai – 18
2. The Deputy Registrar of Co-operative Societies (Credit)
Kuralagam, Chennai -108
3. The Special Officer,
The Management of the Central Excise Staff Co-
operative Thrift and Credit Society Ltd.,
No.120, Nungambakkam High Road