The Management, Kannamangalam Primary Agricultural Co-operative Credit Society, Tiruvannamalai & Others v. The Presiding Officer, Vellore & Others
2010-03-31
P.P.S.JANARTHANA RAJA, PRABHA SRIDEVAN
body2010
DigiLaw.ai
Judgment :- Prabha Sridevan, J. The Labour Court ordered the petitions under Section 33C(2) of the Industrial Disputes Act, 1947 filed by the second respondent herein, Salesmen in the Village Fair Price Shop. The Management, viz. the appellant herein, while denying the claim, specifically stated that the services of the second respondent-workman were not regularised and that the petition was not maintainable. However, the grievance of the appellant is that the Labour court had not even framed an issue with regard to the maintainability of the petitions and granted the relief prayed for. The learned single Judge also, while accepting the case of the respondent, dismissed the writ petition and therefore, this writ appeal has been filed. 2. Mr. M.S. Palanisamy, learned counsel appearing for the appellant-Management submitted that the second respondent was not recruited in accordance with Rule 149 of the Tamil Nadu Co-operative Societies Rules, 1988; therefore, he is a backdoor entrant. His recruitment was not sponsored by the Employment Exchange. He denied that there was any settlement at any point of time between the workman and the appellant-Management under Section 12(3) of the Act. The claim for payment under Section 33C(2) of the Act is not an ascertained claim and therefore, the Labour court could not have ordered the petition under Section 33C(2) without this issue being decided. Learned counsel submitted that the entitlement of the second respondent will be governed by G.O. Ms. No.238, Cooperation Food and Consumer Protection Department, dated 110. 2000 and not G.O. Ms. No.131, Co-operation Food and Consumer Protection Department, dated 6. 1999. He also referred to G.O. Ms. No.3, Cooperation Food and Consumer Protection Department, dated 1. 1994 to show that the claim of the second respondent cannot be accepted. 3. Mr. R. Ramachandran, on behalf of the workman, appeared before us in person, argued the matter and also filed his written submissions. According to him, the employees of village fair price shops are employees of the respective co-operative societies. It is submitted that the Salesmen in the Public Distribution Shops are attached to the appellant-Management by open competition through the employment exchange. The Tamil Nadu Co-operative Societies Rules, 1988 came into effect only on 14. 1988 and therefore, the appointment, which is prior to 1988, is neither illegal nor irregular. According to him, the I.D. Act will prevail over the Government Orders referred to above.
The Tamil Nadu Co-operative Societies Rules, 1988 came into effect only on 14. 1988 and therefore, the appointment, which is prior to 1988, is neither illegal nor irregular. According to him, the I.D. Act will prevail over the Government Orders referred to above. He referred to the judgment of the Constitution Bench of the Supreme Court in Central Bank of India vs. Rajagopalan P.S., A.I.R. 1964 S.C. 743. He has also enclosed the deposition of the Managements representative in the various computation petitions and also the Special Bylaws, in addition to the following judgments : ? Secretary, Plantation Employees Union of South India vs. Estate Staff Union of South India [1991 Lab. I.C. 1393]; National Engineering Industries Ltd. vs. State of Rajasthan [2000 Lab. I.C. 260]; The Management, V.L. Spl. 147 S.V. Nagaram Primary Agricultural Co-operative Bank Ltd. vs. Presiding Officer, Labour Court, Vellore [W.P. Nos.22987 of 2004 etc. batch dated 29. 2005]; ? Kalavai Primary Agricultural Co-operative Bank Ltd. vs. Presiding Officer, Labour Court, Vellore [W.A. No.368 of 2004 etc. dated 33. 2006]; ? Tamil Nadu Kooturavu Oozhiyar Sammelanam vs. Govt. of Tamil Nadu [W.P. Nos.41932 of 2002 etc. batch dated 1. 2003]; and Jiwan Das Sethi vs. State of Punjab [1999 Lab. I.C. 3778] According to him, the order of the learned single Judge should not be interfered with. 4. In evidence, the Secretary of the appellant-Bank Management had deposed in his chief-examination in C.P. No.619 of 2003 that the employee concerned, viz. Jayasingh was appointed contrary to the provisions of the Co-operative Societies Act on 4. 1986. It is also stated that the village fair price shops are run by Government grant and it is from that, the wages of the employees are fixed and they are paid, and that at no point of time had the appellant-Bank entered into a settlement for fixation of wages for the employees of the fair price shops. In cross-examination, there is nothing to support the case of the second respondent. In C.P. No.325 of 2005, a proof affidavit has been filed by the Secretary of the appellant-Bank, wherein it is stated as follows :- "3. I state that the village fair price shops are operated by this Bank under the fair price scheme of the Government of Tamil Nadu. The entire operational expenditure for village shops are borne by the Government by grant of subsidy every year.
I state that the village fair price shops are operated by this Bank under the fair price scheme of the Government of Tamil Nadu. The entire operational expenditure for village shops are borne by the Government by grant of subsidy every year. But for the subsidy, the Bank by itself cannot operate the village fair price shops nor pay wages to the fair price shop salesmen." "7. I state that the Settlement under Section 12(3) was entered on 13. 1994 with the All India Bank Employees Association, a Trade Union of employees, granting certain benefits to the employees of the Bank. I further state that no other Trade Union participated during conciliation on behalf of the employees of the Bank." "10. I state that the wage scale agreed to be paid to other categories of staff are at page 3. The salesmen / Attender post for which wage scale was agreed refers only to the Fertilizer salesmen and not village shop salesmen. The allegation to the contrary made by the petitioner is false." "12. I state that the permitted cadre strength of the respondent-Bank is also mentioned in the Settlement and it would only show only one salesmen which is the Fertilizer salesmen and not village fair price shop salesmen." In cross-examination, he has stated that Shanmugam is a permanent employee of the Bank. In C.P. No.66 of 2007, the workman referred to is one Loganathan. The proof affidavit filed here is identical to the one extracted earlier. The Special Bylaws governing the service conditions of the employees of the appellant-Bank are enclosed in the typed set of papers filed by the second respondent and it refers to salesmen/Attender at Sl. No.4. This is stressed by the second respondent to show that the village fair price shop salespersons are employees of the appellant-Bank. On the other hand, according to the learned counsel for the appellant, this does not refer to the Village Fair Price Shop Salesmen, but the Field Salesmen of the appellant-Bank. 5. In A.I.R. 1964 S.C. 743 (supra), the Constitution Bench considered the scope of the claims under Section 33C(2) of the I.D. Act. According to the second respondent herein, this would support his case.
5. In A.I.R. 1964 S.C. 743 (supra), the Constitution Bench considered the scope of the claims under Section 33C(2) of the I.D. Act. According to the second respondent herein, this would support his case. Briefly, the Constitution Bench held that, "In construing Section 33C(2), we have to bear in mind two relevant considerations and that industrial disputes cannot be brought within the purview of Section 33C(2)." "In our opinion, on a fair and reasonable construction of sub-section (2), it is clear that if a workmans right to receive the benefit is disputed, that may have to be determined by the Labour court". "Claim under Section 33C(2) clearly postulates that the determination of the question about computing the benefit in terms of money may in some cases to be preceded by an enquiry into the existence of that right and such an enquiry must be held to be incidental to the mean determination which has been assigned to the Labour court by sub-section (2)". Therefore, the question regarding the right to receive the benefit must be determined by the Labour Court, if it is raised. 6. In 1991 Lab. I.C. 1393 (supra), a Division Bench of the Kerala High Court held as follows : "The agreement entered into between a majority union and the management can be got certified by the Conciliation Officer and converted into a conciliation settlement provided it is fair and reasonable. When once such an agreement is presented before the Conciliation Officer in the prescribed form, it is his duty to ascertain whether the union which has entered into an agreement is a majority union and commands the support of the majority of the workers in the establishment and whether the agreement is fair and reasonable. On such satisfaction, the Conciliation Officer is bound to certify that agreement as a conciliation agreement so as to bind all the parties to the dispute including the persons who were not parties to the agreement. The fact that the industry takes in also the public sector undertaking does not preclude the bipartite settlement from being converted into a conciliation settlement". In 2000 Lab. I.C. 260 (supra), the Supreme Court dealt with the validity of the notification issued by the State Government under Section 10(1)(d) read with Section 12(5) of the I.D. Act. In W.P. No.22987 of 2004 etc. batch decided on 29.
In 2000 Lab. I.C. 260 (supra), the Supreme Court dealt with the validity of the notification issued by the State Government under Section 10(1)(d) read with Section 12(5) of the I.D. Act. In W.P. No.22987 of 2004 etc. batch decided on 29. 2005 (supra), a Division Bench held that employees like the respondent are entitled to the benefits under the provision of the Minimum Wages Act. This issue does not arise here. In W.A. No.368 of 2004 etc. decided on 33. 2006 (supra), another Division Bench of this Court observed thus :- "10. The definite case of the workmen that all the employees including Village Shop Employees joined together in bringing forth the settlement and that after obtaining the consent of the parties the clauses relating to Village Shop Salesmen were removed, was accepted by the Labour Court as well as the learned single Judge. Further, it is the specific conclusion of the Labour Court that evidence of the Labour Officer amply shows that the clauses relating to Village Shop Employees were struck off only after obtaining their consent. After analysing all the materials, the Labour Court rightly rejected the stand of the Management that the Salesmen strength refers to only one person, i.e., Fertilizer Salesmen and not Village Shop Salesmen. On a careful perusal of the entire materials, we are in agreement with the said conclusion." The facts in the above case are the same as the present case and according to the second respondent, this would operate as res judicata. 7. It is undeniable that the order passed by the Division Bench in W.A. No.368 of 2004 etc. (supra) is in respect of the same co-operative society, i.e., Kalavai and T. Sholavaram Primary Agricultural Cooperative Bank Ltd. and according to the second respondent, therefore, this decision would operate as res judicata. But we see that there, the Settlement that was before the Labour court was dated 13. 1994. In the present case, it is dated 13. 1994. It is pointed out that in the Settlement, the clause relating to village fair price shop salesmen was deleted and therefore, the settlement would not apply to them.
But we see that there, the Settlement that was before the Labour court was dated 13. 1994. In the present case, it is dated 13. 1994. It is pointed out that in the Settlement, the clause relating to village fair price shop salesmen was deleted and therefore, the settlement would not apply to them. Before the Division Bench, the same objection was raised, but the Division Bench held that the evidence of the Labour officer shows that the clauses relating to village fair price shop employees were struck off only after obtaining their consent and the Division Bench rejected the stand of the Management that the salesmen strength refers to only one person, i.e., the Fertilizer salesmen and not the Village Fair Price Shop salesmen. So, these grounds which are raised now cannot be re-agitated by the appellant, but for the issuance of certain Government Orders, which we will refer to below. 8.(i) G.O. Ms. No.3, Co-operation Food and Consumer Protection Department, dated 1. 1994 : From this Government Order, we see that the Committee constituted for streamlining the cadre strength had made recommendations for treating the salesmen running the fair price shop as regular staff of the Primary Agricultural Co-operative Bank and to give them monthly scale of pay. G.O. Ms. No.3 dated 1. 1994 indicates this :- "... This recommendation has not been accepted by the Government because of the huge financial implication. The Government have, however, decided to increase the consolidated salary... 2. They accordingly direct hat the consolidated salary of salesmen of fair price shops run by the Primary Agricultural Co-operative Banks ... whose consolidated salary does not exceed Rs.600/-per month, be increased to Rs.750/- per month..." (ii) G.O. Ms. No.238, Co-operation Food and Consumer Protection Department, dated 110. 2000 : This Government Order deals with the revision of pay for salesmen and packers of fair price shops and the said G.O. reads as follows :- .(a) Those salesmen who had completed 5 years of service as on 4. 2000 are paid at the pay scale of Rs.1250-25-1325-45-1640. The employees of the fair price shop will be paid house rent allowance at the rate of 10% on their basic pay. In future, the employees of the fair price shop will also be paid Dearness Allowance at the same rate as it is paid to the Government employees.
2000 are paid at the pay scale of Rs.1250-25-1325-45-1640. The employees of the fair price shop will be paid house rent allowance at the rate of 10% on their basic pay. In future, the employees of the fair price shop will also be paid Dearness Allowance at the same rate as it is paid to the Government employees. In revised scales of pay may be fixed as prescribed in the annexure. .(b) In respect of those salesmen who had not completed 5 years of service will be paid consolidated payment revised from Rs.900/- they are receiving at present to Rs.1300/- per month. .(c) Inrespect of packers, the consolidated payments which they are receiving at present i.e. Rs.800/- per month having been enhanced to Rs.1150/- per month and paid." If the salesmen in fair price shops were entitled to be treated as salesmen of the co-operative society, then they should have challenged G.O. Ms. No.238. It is the case of the appellant that G.O. Ms. No.131 does not apply to them and G.O. Ms. No.238 alone would apply to the salesmen of fair price shops. If G.O. Ms. No.131 had stood alone in the absence of G.O. Ms. No.238, we would have rejected the case of the appellant outright, because the earlier Division Bench had held that the Salesmen strength refers to only one person, i.e., Fertilizer Salesmen and not Village Shop Salesmen and therefore, a salesmen is not entitled to the said benefit. But by the issuance of the above G.Os., the Government has made it clear that the fair price shops are run by the Department of Co-operation and that it is the Government which fixes the pay of the employees therein and it specifically refers to these salesmen. It is also clear that the salesmen/packers of fair price shops are not regular staff of the Co-operative Societies. (iii) G.O. Ms.No.75, Co-operation Food and Consumer Protection Department, dated 24. 2008 : This Government Order has referred to G.O. Ms. No.238 dated 110. 200, G.O. Ms. No.289, Cooperation Food and Consumer Protection Department, dated 29. 2007 as well as the letter of the Registrar of Co-operative Societies dated 112. 2007. By this G.O., amendments have been issued to G.O. Ms. No.289. This G.O. would also indicate that the Government had treated the salesmen and packers of fair price shops separately, “TAMIL” (iv) Ultimately, by G.O. Ms.
No.289, Cooperation Food and Consumer Protection Department, dated 29. 2007 as well as the letter of the Registrar of Co-operative Societies dated 112. 2007. By this G.O., amendments have been issued to G.O. Ms. No.289. This G.O. would also indicate that the Government had treated the salesmen and packers of fair price shops separately, “TAMIL” (iv) Ultimately, by G.O. Ms. No.75, the following amendments have been made to Paragraph 7(a) of G.O. Ms. No.289 dated 29. 2007 :- .(a) Consolidated salary shall be paid for the first five years to the fair price shop salesmen/packers (Salesmen – Rs.3,000/-; Packers – Rs.3,500/-) .(b) Thepay in respect of those who have put in a service between 6 and 8 years will be fixed under the new pay scale at the initial stage (i.e., Salesmen – Rs.2,000/-; Packers – Rs.1,800/-). .(c) For those who have put in a service of more than 8 years, for the three increments given under the old pay scale, one increment should be fixed under the new pay scale (once in three years). .(d) In respect of Selection Grade employees and for those who have completed 16, 17, 18 years of service, selection grade pay should be fixed under the new pay scale at the initial stage (Salesmen – Rs.2,500/-; Packers – Rs.2,300/-). .(e) For those who have put in a service of more than 18 years, for the three increments given under the old pay scale, one increment should be fixed under the new pay scale (once in three years). The Fitment Table is fixed for only those packers and salesmen of fair price shops whose services have been regularised. All these orders have been passed before the date of the award on 211. 2008. 9. In Mahavoor Farmers Service Co-operative Society Ltd. vs. Inspector of Labour, 1996 (I) L.L.J. 319 , the impact of G.O. Ms. No.3 dated 1. 1994 has been specifically dealt with. In the above case, the First Bench held that employees of fair price shops not having regular scale of pay did not fall within the cadre of employment created within the co-operative society. That judgment was, of course, passed in the context of the minimum wages fixed by the State Government in respect of the employees in the shops and the question was, whether the fair price shop would fall within the definition of a shop.
That judgment was, of course, passed in the context of the minimum wages fixed by the State Government in respect of the employees in the shops and the question was, whether the fair price shop would fall within the definition of a shop. But the Bench had clearly held, referring to G.O. Ms. No.3, that the recommendation that the salesmen running the fair price shops should be treated as regular staff of the Primary Agricultural Co-operative Bank was not accepted by the Government because of the huge financial implication (emphasis ours). The Bench also held that the employment in the shop of the co-operative society in question is not included or is not covered by the cadre of services under the co-operative society with a scale of pay attached to it, carrying regular annual increments. The Division Bench also held that, "the employees working in the shop of the appellant-society, do not fall within the cadres of employment craeted in the co-operative society in as much as they do not have the regular scale of pay. They work only as wage-earners". So this judgment has been rendered on a consideration of G.O. Ms. No.3. 10. In Tamil Nadu Vatta Kooturavu Veetu Vasathi Sangangalin Anaithu Paniyalargal Madya Sangam vs. Deputy Registrar of Co-operative Society (Housing), Cuddalore [2008 (2) L.L.N. 236], the First Bench held as follows :- "11. A reading of the said provision makes it clear that the said provision empowers the Registrar to issue such directions if he is satisfied that in public interest or for the purpose of securing proper implementation of co-operative production and other developmental programmes and also to secure the proper management of the business of any class of registered societies generally or for preventing the conduct of any society which would otherwise be detrimental to the interest of its members or depositors or creditors such directions are imminently required. The powers thus invested with the Registrar under Section 181 of the Act 1983 is wide enough and so iong as such powers are exercised keeping in mind the purport and intend of the said provision and with a view to fulfil the statutory obligations prescribed therein, there would be no scope for anyone to contend that the exercise of such power could be called in question. 12.
12. In fact, under Rule 149 of the Rules 1988/ it is specifically provided that by taking into account its nature of business, volume of transaction and financial position, frame a special bye-law, with prior approval of the Government, and such special bye-law should prescribe inter alia the service conditions of its employees, scale of pay and allowances etc. for each such post. 13. In fact, it was brought to our notice that by G.O. Ms. No. 289, dated 112. 1998 a Committee was constituted to revise the scale of pay and other service conditions of the employees of the cooperative banks with effect from 7. 1997 and that subsequently, under G.O. Ms. No. 186, dated 18. 2000 such revision in scales of pay of different posts came to be prescribed with effect from 7. 1997 to be in operation for a period of five years. Therefore, it can be safely concluded that the provisions contained in the 1983 Act as well as the Rules framed thereunder were being implemented in regard to the prescription of pay scales and other service conditions by the authorities concerned from time to time. In fact, a perusal of the impugned orders disclose that contrary to the provisions contained in the 1983 Act and the Rules, the individual societies instead of adhering to the directions issued by the Registrar of Co-operative Societies, under Section 181 of the Act 1983 were entering into various settlements with their employees under the provisions of the I.D. Act and thereby torpedo the statutory directions issued by the Registrar of Co-operative Societies under Section 181 of the 1983 Act. 14. In fact, Rule 149 of the Rules 1988 came into being by way of G.O. Ms. No. 212, dated 1. 1997, i.e., after the pronouncement of the Division Bench decision reported in 1992 1 LLJ 747 . On the basis of the judgment of the earlier Division Bench, the State Government in order to restrain the individual Societies entering into such wage settlements without reference to the viability of the concerned Co-operative Societies thought it fit to incorporate the provision in the Rules by introducing Rule 149. 15.
On the basis of the judgment of the earlier Division Bench, the State Government in order to restrain the individual Societies entering into such wage settlements without reference to the viability of the concerned Co-operative Societies thought it fit to incorporate the provision in the Rules by introducing Rule 149. 15. By no stretch of imagination, the said Rule can be said to be either conflicting with the provisions of I.D. Act or introduced with any other ulterior motive to defeat the lawful rights of the employees of any of the registered societies. The purport of the rule is to ensure that a registered society does not become defunct or unwieldy and any of the registered societies should not be allowed to be closed due to dearth of funds by mismanagement. Therefore, the constitution of the Committee for formulating the common wage structure for the employees of the registered Co-operative Societies by G.O. Ms. No. 289, dated 112. 1998 and the subsequent G.O. Ms. No. 186, dated 18. 2000 were all in furtherance of the fulfilment of the above objective of the State Government." The Bench had upheld the direction issued by the Deputy Registrar of Co-operative Societies to cancel the settlements which had been arrived in contravention of the directions issued by the Registrar of Co-operative Societies. 11. While we should have ordinarily accepted the submissions of the second respondent that the judgment in W.A. No.368 of 2004 etc. in respect of the same co-operative societies is binding on us. But it is clear that the above G.Os. have not been brought to the notice of the Division Bench which decided W.A. No.368 of 2004 etc. 1996 (I) L.L.J. 319 (supra) was also not placed before the Bench. 12. There is nothing to show that G.O. Ms. No.238 or G.O. Ms. No.3 have been challenged. On the contrary, G.O. Ms. No.3 and G.O. Ms. No.238 have been affirmed in 1996 (I) L.L.J. 319 (supra) and in 2008 (2) L.L.N. 236. Had the labour court framed the issue in this regard, this error could have been avoided. But as it is, in view of G.O. Ms. No.238, which specifically refers to salesmen of fair price shops and there is no scope for ambiguity, the amounts payable to the workmen cannot be quantified otherwise than in accordance with G.O. Ms. No.238 as modified subsequently. 13.
But as it is, in view of G.O. Ms. No.238, which specifically refers to salesmen of fair price shops and there is no scope for ambiguity, the amounts payable to the workmen cannot be quantified otherwise than in accordance with G.O. Ms. No.238 as modified subsequently. 13. On the other hand, in the unreported judgment in W.A. No.368 of 2004 etc. dated 33. 2006, while factually findings have been given, G.O. Ms. No.3 which has been upheld in 1996 (I) L.L.J. 319 (supra) was not brought to the notice of the court. So long as G.O. Ms. No.3 stands unchallenged and is not quashed, we have to accept the stand of the Government that salesmen running the fair price shops are not regular staff of the Primary Agricultural Co-operative Banks. The Government did not accept the recommendation to treat them equally. 14. In L. Justine vs. The Registrar of Co-operative Societies, 2002 (4) C.T.C. 385 , appointments made without qualification and beyond the sanctioned strength were held to be backdoor entry. In the present case, the stand of the appellant is that the second respondent was not qualified and final orders of regularisation were still awaited in his case. On facts, with regard to the workman Velu, it is stated that he lost his job because of proven charges of misappropriation. In the order dated 1. 2003, the Division Bench has clarified their decision in Justines case in 2002 (4) C.T.C. 385 that, "If the cadre strength has already been fixed taking into consideration the relevant Governmental oders like G.O. Ms. No.131 dated 6. 1999, G.O. Ms. No.89 dated 15. 2000, G.O. Ms. No.186 dated 18. 2000, G.O. Ms. No.238 dated 110. 2000, G.O. 4(D) No.1 dated 11. 2001 and G.O. Ms. No.94 dated 13. 2001, that will stand and while considering the cadre strength, the above Governmental orders shall also be taken into consideration". This also makes it clear that G.O. Ms. No.238 is still holding the field. G.O. Ms. No.238 specifically refers to salesmen and packers. G.O. Ms. No.3 makes it clear that the workers in fair price shops cannot be treated as a regular staff. So, G.O. Ms. No.131 cannot apply to them. G.O. Ms. No.75 dated 24. 2008 has referred to G.O. Ms. No.238 and G.O. Ms.
No.238 is still holding the field. G.O. Ms. No.238 specifically refers to salesmen and packers. G.O. Ms. No.3 makes it clear that the workers in fair price shops cannot be treated as a regular staff. So, G.O. Ms. No.131 cannot apply to them. G.O. Ms. No.75 dated 24. 2008 has referred to G.O. Ms. No.238 and G.O. Ms. No.289 and had accepted the request of the Associations of employees working in fair price shops that their annual income should be increased. This G.O. has also clearly referred to salesmen and packers in fair price shops as a separate category. 15. We have reiterated more than once why the stand of the workman cannot be accepted, only because the party-in-person appearing on his behalf made specific submissions with supporting decisions. When the learned counsel for the appellant has placed before us the strong array of these three Government Orders, it is difficult for us to ignore them. Therefore, the entitlement of the Salesmen of the Village Fair Price Shops must be computed only in terms of G.O. Ms. No.238 dated 110. 2000 and G.O. Ms. No.75 dated 24. 2008. This computation has been made pursuant to the representation of the workman; if the appellant-Management has not paid them accordingly, then they may make a request in this regard. If the appellants do not pay them their dues as per the G.Os., it would be open to the workmen to proceed in accordance with law. 16. For all theabove reasons, the writ appeal is allowed. The order passed by the learned single Judge is set aside. The writ petitions are also allowed. In the facts and circumstances of the case, there shall be no order as to costs. Consequently, M.P. No.1 of 2010 in the writ appeal and M.P. Nos.1, 1, 1 and 1 of 2009 in W.P. Nos.8466, 8467, 8468 and 8469 of 2009 respectively are closed.