Research › Search › Judgment

Karnataka High Court · body

2023 DIGILAW 1169 (KAR)

Amanath Co-Op Bank Ltd v. Mohammed Sharfuddin

2023-10-05

R.DEVDAS

body2023
JUDGMENT 1. The petitioner/Co-operative Bank is aggrieved of the impugned order dtd. 31/7/2017 passed by the Karnataka Appellate Tribunal in Appeal No.583/2012. 2. One Smt.Badar Jahan, the wife of the first respondent and mother of the second respondent was an employee of the petitioner-Bank. Smt. Badar Jahan retired from service on the ground that she attained the age of superannuation on 30/5/2009. It is not disputed by the petitioner-Bank that the State Government had amended the provisions contained in clause (i) of sub-rule (4) of Rule 18 of the Karnataka Co-operative Societies Rules, 1960 (hereinafter referred to as 'the Rules', for short) by publishing the amended rules in the official gazette on 17th of September 2008. Prior to the amendment, the age of superannuation of an employee of a co-operative society was 58 years. However, after the amendment, the age of superannuation stood enhanced to 60 years. 3. Smt. Badar Jahan had approached this Court in W.P.No.32990/2009, seeking a direction to the petitioner- Bank to continue her in service till she attains the age of 60 years. However, since the writ petitioner had an alternative and efficacious remedy, the writ petition was dismissed by order dtd. 18/1/2010. Thereafter, Smt.Badar Jahan raised a dispute under Sec. 70 of the Karnataka State Co-operative Societies Act, 1959 (hereinafter referred to as 'the Act', for short), before the third respondent-Joint Registrar of Co-operative Societies. The third respondent- Joint Registrar of Co-operative Societies (for short 'JRCS') dismissed the appeal on 14/6/2012. In the meanwhile, Smt.Badar Jahan passed away on 2/6/2011. The respondents herein, being the legal representatives of Smt.Badar Jahan approached the Karnataka Appellate Tribunal, seeking directions that Smt.Badar Jahan was entitled to continue in service till the age of 60 years; that she should be treated as in-service for the entire period; that she is entitled for arrears of salary and retirement benefits to be re-determined accordingly; that the second respondent herein is entitled for appointment on compassionate grounds, etc. The Tribunal allowed the appeal and directed the petitioner-Bank to treat the deceased employee as in-service between 30/5/2009 to 30/5/2011; to pay arrears of salary and all retirement benefits. 4. Learned Counsel for the petitioner-Bank submits that the service conditions of the employees of the Bank are determined in terms of the bye-laws of the Co-operative Bank. The Tribunal allowed the appeal and directed the petitioner-Bank to treat the deceased employee as in-service between 30/5/2009 to 30/5/2011; to pay arrears of salary and all retirement benefits. 4. Learned Counsel for the petitioner-Bank submits that the service conditions of the employees of the Bank are determined in terms of the bye-laws of the Co-operative Bank. Learned Counsel submits that although it cannot be disputed that an amendment was brought to the relevant rules on 17th of September 2008, nevertheless, such a benefit cannot be given to the employees till the amended rules are incorporated in the bye-laws of the petitioner/Co- operative Bank. Learned Counsel submits that the bye-laws of the petitioner-Bank were amended on 1/10/2009, by which time, Smt.Badar Jahan had attained the age of superannuation on 30/5/2009. Learned Counsel submits that there was some delay on the part of the petitioner- Bank in filing the writ petition, however, the reasons are explained while stating that the Reserve Bank of India has suspended the banking licence of the petitioner-Bank by order dtd. 1/4/2013. The banking operations were resumed only on 3/1/2020. At that point of time, COVID- 19 pandemic broke out and for the next one year there was disruption in the activities of the bank and therefore, there was a delay in filing this writ petition. 5. Per contra, learned Counsel for the contesting respondents No.1 and 2 submits that the issue is no more res integra. This Court, in the case of the Karnataka District Central Co-operative Bank Ltd., Vs. The Registrar of Co-operative Societies and Another, in W.P.No.60819/2009 dtd. 11/2/2009 at Dharwad Bench held that there cannot be any dispute that the bye-laws of the Co-operative Societies registered under the Act will have to be in accordance with the statute and the rules framed thereunder. It was held that Sec. 129 of the Act empowered the State to frame rules and consequently, the then Rule 18(2) of the Rules, which provided for conditions of service were amended and the age of retirement of the employees of the Co-operative Societies were re-fixed by the said rules. It was held that the bye-laws of the society shall concur with the amended rules. It was held that the bye-laws of the society shall concur with the amended rules. It was also argued that the final authority with regard to the bye-laws of the Co-operative Societies vested with the General Body of the society, in terms of Sec. 26 of the Act and therefore, it was not open for the Registrar or the State Government to dictate terms to the society to modify the age of retirement of the employees of the Co-operative Societies. This argument was also rejected by this Court while holding that Sec. 26 of the Act, no doubt vests the final authority in the General Body of the society, but the same would be subject to the provisions of the Act and the rules framed thereunder. 6. Having heard the learned Counsel for the petitioner-Bank, learned Counsel for the contesting respondents, the learned Additional Government Advocate and on perusing the petition papers, this Court finds that Rule 18 of the rules provides for the method of recruitment and conditions of service of the employees of the co- operative societies. Sub-rule (4) of Rule 18, under the heading 'Conditions of Service', prescribes the age of retirement of officers or employees of the co-operative societies. These prescriptions, in the matter of recruitment and conditions of service of the employees of the co- operative societies are applicable without there being any option left with the societies. Sec. 129 of the Act empowers the State Government to make rules to carry out the purposes of the Act, for any class of co-operative societies. Sub-sec. (2) of the Sec. 129 provides that in particular, and without prejudice to the generality of the powers of the State Government, the rules may provide for all or any of the matters enumerated therein. Clause (c) of sub-sec. (2) is in respect of matters of which a co- operative society shall or may make bye-laws. Sub-sec. (4) of Sec. 129 clearly provides that every rule made under the Act shall have effect as if enacted in the Act. 7. In that view of the matter, the amended rules having been published in the official gazette on 17th of September 2008, followed by a Circular dtd. Sub-sec. (4) of Sec. 129 clearly provides that every rule made under the Act shall have effect as if enacted in the Act. 7. In that view of the matter, the amended rules having been published in the official gazette on 17th of September 2008, followed by a Circular dtd. 25/9/2008 issued by the Joint Registrar of Co-operative Societies, directed that the amended provisions enhancing the age of superannuation of the employees of the co-operative societies from 58 years to 60 years shall be adhered to in all co-operative societies, forthwith. Having regard to the mandatory provisions empowering the State Government to fix the age of superannuation in the rules and the rules not being under challenge, the petitioner-Bank was required to give effect to the amended provisions from the date when which it was brought into force by publication in the official gazette. 8. In that view of the matter, this Court does not find any infirmity in the impugned order passed by the Karnataka Appellate Tribunal. Accordingly, the writ petition stands dismissed.