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1997 DIGILAW 44 (ALL)

LAXMI SINGH v. STATE OF U P

1997-01-16

B.S.CHAUHAN, D.S.SINHA

body1997
B. S. CHAUHAN, J. The instant writ petition has been filed for quashing the reversion order dated 2-11-1987 con tained in Annexure 6 to the writ petition, by which the petitioner has been reverted from the post of Secretary, Manila Upbhogta Sahkari Samiti Ltd. to the post of Shop Manager. 2. The grievance of the petitioner is that she had been appointed as Shop Manager in Kachehari Shakha with the respondent society on 21-2-84 on the basis of commission at the rate of 4% on profit of sale proceeds and she was appointed as Secretary of the respondent society with effect from 18-12-86 and her appointment was duly approved in the administrative meeting of the respondents society and approval was accorded to her appoint ment as Secretary by the District Assistant Registrar Co-operative Societies, Jaunpur vide order dated 15-12-1986. However, the petitioner was reverted to the post of Shop Manager by the impugned order. Hence this writ petition. 3. The respondents had filed the counter-affidavit wherein a preliminary objection has been raised by the respon dents that the respondent society is not amenable to the writ jurisdiction as it is a co- operative Society registered under the Co-operative Societies Act, 1965, (hereinafter called as the Act) and no rules whatsoever have been framed under Sec tions 121, 122 and 122-A of the Act and thus, the services of the Secretary of the respondent society were not governed by any statutory rule and petitioner cannot seek redressal of her grievances under Ar ticle 226 of the Constitution of India. 4. At the time of hearing, Shri Ashok Bhushan, learned Counsel for the respon dents has raised the same preliminary ob jection and for the time being the matter has been heard only on the issue of main tainability of the writ petition. Shri M. D. Singh Shekhar and Shri G. N. Singh, learned Counsel appearing for the petitioner have taken us through various provisions of the Act and the bye-law framed by the respondent society and their averment is that as the services of the Secretary are governed by the provisions of Section 31 of the Act, the removal of the petitioner from the said post is illegal and the petition is maintainable. 5. 5. A Full Bench of this Court has considered this aspect in Radha Charan Sharma v. U. P. Co-operative Federation and others, 1982 UPLBEC 89, and after con sidering a catena of judgments of the Supreme Court and of this Court came to the conclusion that the Co-operative society is not amenable to the writ jurisdic tion as the bye-laws framed by the Co operative societies do not have any statutory force and no rule involving a duty of public nature is violated. 6. This view has consistently been followed by this Court and recently in Ram Lakhan Pathak v. District Assistant Registrar, Co-operative Societies, Kanpur and others, 1996 (1) ESC 32, this Court has held that in such a case the conditions of service of the employees are not governed by any statutory rule or regulation. The co-operative society is not an authority within the meaning of Article 12 of the Constitution nor it is an instrumentality of the State nor it exercises any statutory power or discharges statutory/public duties and writ petition is nit maintainable against a co-operative society. 7. Similar view has been taken by the Karnataka High Court in Workmen Kampli Co-operative Sugar Factory Limited v. The Management of Kampli Sugar Factory Limited and others, 1994 (69) FLR 319, and it has been held that such rights are purely of a private nature and the same cannot be challenged in writ jurisdiction and in spite of the fact that the expression "governmental function" may suffer from vagueness and indefiniteness the activity of manufacturing sugar cannot fall within the ambit of public duty or Governmental function as the production of sugar is being done only with the view to earn profit for the members of the society. 8. In Co-operative Central Bank Limited and others v. Additional Industrial Tribunal, Andhra Pradesh, AIR 1970 SC 245 , the Supreme Court observed that the bye-laws of a Co- operative Society framed under the provisions of the Act do not have any force of law as the bye-laws con templated by the Act govern the internal management, business or administration of a society and they may be binding upon the persons affected by them. The bye-laws providing for the service conditions of the employees of the society may be binding between the society and its employees in the same manner as conditions of service provided for in a contract between the parties. The Court observed as under: "the bye-laws that can be framed by a society under the Act are simisar in nature to the Article of Association of a company incor porated under the Companies Act and such Article of Association have never been held to have the force of law. " A Constitution Bench of the Supreme Court in Sabhajeet Tewari v. Union of India and others, AIR 1975 SC 1329 , took the view that the society does not have a statutory character and it is merely a society incorporated in accord ance with the provisions of the Societies Registration Act inspite of the fact that the statute provides for management etc. by the Government of India, reason being that the Government has to control to the extent that the governing body shall frame, amend and repeal the bye- laws etc. strictly in accordance with the purposes for which the society has been formed. The said society was found to have its existence independent from the Government and the law relating to corporations. 9. In Chandra Mohan Khanna v. The National Council of Educational Research and Training and others, AIR 1992 SC 76 , the Apex Court after considering the law on the subject held that if "the function of the institutions are of public importance and related to the governmental functions" it may be treated as a state or state instrumentalities. However, it was further clarified that State control does not render such bodies as state under Article 12 nor the financial contributions by the state is conclusive. 10. A Full Bench of Andhra Pradesh High Court in Sri Konaseema Co-operative Central Bank Limited, Amalapuram and another v. N. Seetharama Raju, AIR 1990 AP 171 , has Veld that if the petitioner invoke the win jurisdiction of the High Court , he must satisfy the Court that he is seeking enforcement of a statutory public duty. Moreover, nomenclature by which the rules, regulations or bye-laws are known is immaterial. The relevant deter mining factor is its essential nature which can be determined by applying the test whether the same can be termed as delegated legislation. Moreover, nomenclature by which the rules, regulations or bye-laws are known is immaterial. The relevant deter mining factor is its essential nature which can be determined by applying the test whether the same can be termed as delegated legislation. The Court after ex amining the various provisions of the Co operative Societies Act of Andhra Pradesh, came to the conclusion that the bye-laws framed there, were not having any force of law as they had not been framed by any delegate of legislature. The Court considered the judgments of the Supreme Court in Ajay Hasia v. Khalid Munir, AIR 1981 SC 487 and Ramanna Dayaram Shetty v. International Airport Authority, AIR 1979 SC 1628 , and came to the conclusion that as the society was not doing any governmental functions or had been of any public importance and as the existence of deep and pervasive State con trol was not there, the society could not be found to be state within the meaning of Article 12 of the Constitution of India. The public authority must be a body, which has legal authority to determine the question affecting the statutory rights or obligations of other persons as individual. Such body must be the creation of the statute and its powers and duties are defined by the statute, e. g. legil authorities, statutory undertakings and corporations. When an authority protects only the private rights of its individual member, it cannot be a public authority or cannot be said to be performing the public duty. 11. However, the Court held that if the duty imposed by a body, whether ex pressly or by implication, was a public duty and the body was exercising public law function, the decision of that body would be amenable to judicial review. Applying all those tests, the Court examined the nature of the co-operative society involved in that case and came to the following conclusion : "it has no duty towards public. Its duty is towards its members only. It has no power to take action, or pass any order affecting the rights of the members of the public. The binding na ture of its order and action is confined to its members and to its employees. It is neither a statutory body nor it has relations with its employees governed by a statute. Its functions are also not akin to governmental functions. . . . . . The binding na ture of its order and action is confined to its members and to its employees. It is neither a statutory body nor it has relations with its employees governed by a statute. Its functions are also not akin to governmental functions. . . . . . . . . . . . . . . . . . . . . Even if. . . . . . . . . . . . . . . . . . it can be charac terized as a public body, even so the contract of service between it and the writ petitioner cannot be treated as belonging to public law field. It is a pure and simply contract of service, and there is no statutory provisions regulating, circumscrib ing and governing the State relationship 12. The Full Bench summarised the following legal propositions: - " (1) If a particular co-operative society can be characterized as a state within the meaning of Article 12 of the Constitution. . . . . . . . . It would also be an authority within the meaning, and for the purpose, of Article 226 of the Con stitution. In such a situation, an order passed by a society against its employees in violation of the bye-laws can be corrected by way of a writ peti tion. . . . . . . . . (2) Even if a society cannot be charac terized as a state. . . . . . . . even so a writ would lie against it to enforce a statutory public duty which an employee is entitled to enforce against the society. . . . . . . . . . . . . . . . . What is material is the na ture of the statutory duty placed upon it, and the Court will enforce such statutory public duty (3) The bye-laws made by a co-operative society registered under the. . . . . . . . . . . Co-opera tive Societies Act do not have the force of law. They are in the nature of a contract, terms of contract between the society and its employees or between the society and its members, as the case may be. . . . . . . . . . . Co-opera tive Societies Act do not have the force of law. They are in the nature of a contract, terms of contract between the society and its employees or between the society and its members, as the case may be. Hence, where a society cannot be characterized as a state, the service conditions of its employees, governed by bye-laws, cannot be enforced through a writ petition. " 13. A Full Bench of this Court in Aley Ahmad Abidi v. District Inspector of Schools, Allahabad and others, AIR 1977 All. 531, placed reliance upon the judg ment of the Supreme Court in Praga Tools Corporation v. C. V. Imannual, AIR 1969 SC 1306 , wherein it has been held that the writ of mandamus can be issued to a per son requiring him to do particular thing which appertains to his office and is in the nature of his public duty or to carry out duties placed upon him by the statute and came to the conclusion that unless there is legal obligation or a duty imposed by a statute, the violation of the same shall not render the person amenable to writ juris diction. 14. In Chakradhar Patel v. Samasingha Service Co-operative Society Limited and others, AIR 1982 Ori. 38 , a Division Bench of the Orissa High Court held that the termination of the services of an employee of a co-operative society cannot be challenged in writ jurisdiction. While deciding that case, reliance had been placed on the judgment of the Supreme Court in Executive Committee of West De gree College Shamli v. Laxmi Narain, AIR 1976 SC 888 . 15. Similarly, a Full Bench of Kerala High Court in P. Bhaskaran and others v. Additional Secretary, Agriculture (Co operation) Department and others, AIR 1988 Ker. 74, held that the Co-operative societies are not the creation of the Co operative Societies Act and they are not statutory bodies. They are merely functioning in accordance with the provisions of the Act as the institutions would have legal existence, even if the Co operative Societies Act was not in force. There is no deep and pervasive State con trol, the management is under the effec tive control of a committee elected by the members of the societies and thus, such societies are not amenable to the writ jurisdiction. 16. There is no deep and pervasive State con trol, the management is under the effec tive control of a committee elected by the members of the societies and thus, such societies are not amenable to the writ jurisdiction. 16. Similar view has been taken by the Full Bench of Madhya Pradesh High Court in Ram Swarup Gupta v. Madhya Pradesh State Co-operative Marketing Federation Ltd. and others. AIR 1976 M. P. 152. How ever, it was held that if there is violation of any statutory provision or rule or bye-laws the writ can be issued in such an ap propriate case. 17. In Rajasthan State Road Transport Corporation v. Krishnakanth AIR 1995 SC 1 715 , the Supreme Court has categorically held that where dispute arise from general law of contract, i. e. , where reliefs are claimed on the basis of the general law of contract, the appropriate forum may be a civil court and appropriate remedy would be civil suit. 18. Thus, in view of the above, the relevant provisions of the U. P. Act, rules and bye-laws are being examined. Section 2 (c) of the Act defines "bye-laws" as the registered bye-laws of a co-operative society for the time being in force. Section 4 of the Act reads as under: "societies which may be registered.- Sub ject to the provisions of this Act, a society which has as its object the promotion of the economic interests of its members in accordance with the Co-operative principles or a society established with the object of facilitating the operations of such a society, may be registered under this Act. " (emphasis added) 19. Section 6 provides for the ap plication for registration and it lays down the conditions including that the applica tion for registration shall also be accom panied by three copies of the proposed bye-laws of the society. Under Section 7, the Registrar has been given the power to register the society if it fulfill the condi tions including the condition that the proposed bye-laws are not inconsistent with the provisions of the Act and the Rules. Section 12 provides for amendment of bye-laws of a co- operative society and it provides that a co-operative society may amend its bye-laws. The only rider is that such amendment would also be registered under the Act. Section 12 provides for amendment of bye-laws of a co- operative society and it provides that a co-operative society may amend its bye-laws. The only rider is that such amendment would also be registered under the Act. Section 14 of the Act em powers the Registrar that under certain circumstances, he may require the society to make the amendment within a stipu lated period. Section 31 of the Act lays down the procedure of the appointment of the Secretary. It reads as under: "the Secretary, his emoluments and func tions.- (1) Except in the case of an apex society there shall be a secretary of every co- operative society, to be appointed and removable by the society subject to the provisions of the rules and regulations framed under Sections 121 and 122. . . . . . . . . . . . " (emphasis added) 20. Section 121 empowers the Registrar to frame regulations to regulate the emoluments and other service condi tions of the employees of a co-operative society. Similarly, Section 122 provides for the authority to control the employees of the co-operative societies. It provides that the State Government may constitute an authority for the recruitment training and disciplinary control of the employees of the society and may require such authority to frame regulations regarding service conditions of the employees subject to some other provisions of the Act. 21. Chapter 3 of the U. P. Co-operative Societies Rules, 1968 provides for bye-laws. Under Rule 13, the Registrar may frame model bye-laws for the society. Rule 14 provides that a society may adopt the model bye-laws, if the same are appropriate for it with such modification as may be considered necessary by the society having regard to its recruitment. Rule 15 provides for the area which would be covered by the bye-laws of the Co-operative society. Sub-rule XVIII reads as under: "appointment, suspension, removal and punishment of officers and employees of the society subject to the provisions of regulations framed under Sections 121 and 122. " Section 4 (42-B) of the U. P. General Clauses Act, 1904 provides as under: "statutory instrument shall mean any notification, order, scheme, rule or bye-laws issued under any enactment and having the force of law. " 22. It is the admitted case of the par ties that there are no rules or regulations framed under Sections 121 and 122. " Section 4 (42-B) of the U. P. General Clauses Act, 1904 provides as under: "statutory instrument shall mean any notification, order, scheme, rule or bye-laws issued under any enactment and having the force of law. " 22. It is the admitted case of the par ties that there are no rules or regulations framed under Sections 121 and 122. The bye- laws framed by the respondent society makes it clear that the main purpose of forming the society is to give the financial assistance to its members and to deal with the savings of its members and to run the lodging, boarding, hotel and tailoring shop for its members. 23. Thus, after examining the entire bye-laws of the society and the applicable provisions of the Act and Rules, the unes-capable conclusions, one may reach is that the society does not owe its birth to the statute. The control of the State-ad ministration on the society is not deep and pervasive. The bye-laws in question do not have any force of law as the same do not possess any character of delegated legisla tion. It is a creation of the Committee of Management of the Co-operative Society and mere registration of the society would not change its nature. The society does not perform any statutory duty nor does it per form any act which may be termed as Governmental function. Dealing with the savings of its members or providing for lodging or manning of hotel or tailoring shop for its members is by no stretch of imagination be termed as Governmental function or a public duty. It merely remains a private person and the bye-laws provide the terms of contract between the society and its employees or society and its members. Merely, because the society functions in consonance with the provisions of the Act, it cannot be a statutory authority because the society can exist even if the Act is not in force. Thus, neither the society owes its birth to the statute nor it depends for its existence upon the statute. The bye-laws are simply in the nature of Article of Association of a company or a document providing for general terms and conditions of a con tract/agreement between the parties. 24. Thus, neither the society owes its birth to the statute nor it depends for its existence upon the statute. The bye-laws are simply in the nature of Article of Association of a company or a document providing for general terms and conditions of a con tract/agreement between the parties. 24. In the instant case the bye-laws are certainly not the statutory instrument nor it has the force of law because the same have not been framed under any enactment as required by the provisions of Section 2 (42-B) of the U. P. General Clauses Act, 1904. It is the substance and not the nomenclature, which is the determining fac tor. Moreover, it is not a case where the petitioner has challenged the order passed by any statutory authority. Had the im pugned order been passed by the Registrar acting as a statutory authority in the pur porting exercise of the statutory power con ferred upon him by the Act, the writ petition could definitely was maintainable, (vide Naralngarh Co-operative Central Bank v. Narain Nath, AIR 1977 SC 112 . 25. Learned Counsel for the petitioner has placed reliance upon the judgment of a Division Bench of this Court in Samam Singh v. President, Konch Sahkarikraya Vikraya Samiti Ltd. , Konch, Maun, (1992) 1 UPLBEC 464, wherein this Court after examining the nature of duties imposed on the said society and the positive obligation owned by the said society. to the people generally, held that the society was performing public duty and thus, it was amenable to writ jurisdiction. 26. In the present case, after examin ing the bye-laws of the society, we reach the contrary conclusion and thus, the said case is distinguishable. The public duty means, the duty imposed by any statutory instrument expressly or by implication. It cannot be the duty, self imposed by an association of persons entrusted in co operative movement. This view is fortified by the judgment of the Supreme Court in Unni Krishna IE v. State of A. P. , AIR 1993 SC 2178 , where the Apex Court has ob served as under: "since the recognising/affiliating authority is the state, is under obligation to impose such conditions as part of its duty enjoyed upon it by Article 14 of the Constitution. It cannot allow itself or its power and privilege to be used unfair ly. It cannot allow itself or its power and privilege to be used unfair ly. " (Emphasis added) Therefore, it is clear that a public duty must relate to public functions of the public authority and it cannot include matters of private details relating to in dividual, which may be incidence of a con tract and the natural corollary of it may be that a person discharging public duty generally should hold a public office. The society cannot enforce its Rules or bye-laws against the members of the society or its employees. Employees or members of the society, if aggrieved by the action of the Committee of Management, cannot resort to writ jurisdiction for redressal of their grievance as it is settled law that pontractual obligation cannot be enforced through writ jurisdiction, (vide Mis. Radha Krishna Agarwal and others v. State of Bihar and others, AIR 1977 SC 1496 ; Premji Bhai Parmarand others v. Delhi Development Authority, AIR 1980 SC 738 ; Bareilfy Development Authority v. Ajay Pal Singh and others, AIR 1989 SC 1076 ; Union of India v. Graphic Industries Company, 1994 (5) SCC 398 ; Indore Development Authority v. Smt. Sadhna Agarwal, 1995 (3) SCC 1 and Delhi Development Authority v. Pushpendra Kumar Jain, AIR 1995 SC 1 . 27. Thus, in view of the above, we are of the considered opinion that the writ petition is not maintainable and hence dis missed as such. Petition dismissed.