Jina Chandran S. and Others vs Registrar of Co-operative Societies and Others

S.S. Subramani, J.—In all these writ petitions, the question that arises for consideration is, whether the respondents are entitled to take

action against the Society or the Board of Directors to nullify the settlement deeds arrived at by them with the Banks.

In all these cases, petitioners contend that whenever the employees make a payment taking into consideration the best interest of the Society,

and also taking into consideration the financial position, a settlement was arrived at u/s 12(3) of the Industrial Disputes Act. After settlement is

arrived at, a resolution is also passed by the Board of Management to implement the settlement. When such resolutions are passed and wages are

paid on the basis of the settlement, respondents are issuing proceedings with an intention to nullify the effect of the settlement either by passing any

order that they intend to invoke the proceedings u/s 80 of the Tamil Nadu Co-operative Societies Act, 1983 or the extra amount paid to the

employees is returned to the members in management, or initiate proceedings u/s 153 of the Act. According to petitioners, respondents have no

jurisdiction to initiate such proceedings when it is a lawful settlement under the Industrial Disputes Act.

Even though some of the matters have been admitted and stay was ordered in the year 1991 itself, till date no counter has been filed.

Learned Additional Government Pleader also submitted that the point to be decided is already covered by a decision of this Court, and

appropriate orders may be passed taking into consideration the said decision.

After having heard learned counsel on both sides, I feel that the facts of all these writ petitions are covered by decision of this Court, reported in

Tiruchirapalli Hirudayapuram Co-operative Bank Employees'' Union v. Joint Registrar of Co-op. Societies, Tiruchirapalli (1992 I LLJ 747) which

is also a case coming under the Tamil Nadu Co-operative Societies Act. In that case also, the scope of the settlement u/s 12(3) of the Industrial

Disputes Act arrived at between the management and the employees was sought to be set at naught by the Registrar of Co-operative Societies.

The same was challenged before a Division Bench, in a batch of writ petitions, and in that case, it was held thus:-

..... It is true that the relevant point of time when the settlements were arrived at, the Societies were manned by elected bodies and those office-

bearers of the elected bodies represented the cause of the management of the Co-operative Societies in arriving at the settlements. There has been

a subsequent change by the Tamil Nadu Co-operative Societies (Appointment of Special Officers) Act, 30 of 1991, coming into force and the

Special Officers getting hold of the management of the Co-operative Societies. But the tenure of the settlements has not yet lapsed and this is the

admitted position. There is no gainsaying that the settlements arrived at shall be binding on the successors-in-office of the Co-operative Societies.

It will not be proper for this Court in the present proceedings to express any opinion with reference to the factors put forth by the respondents as

vitiating the settlements and give an adjudication over them. We are only called upon to go into the legal propriety of the proceedings impugned in

these cases whereby the settlements are sought to be nullified. Whatever be the nature of the factors alleged as vitiating the settlements, can the

respondents by the proceedings impugned, give up adjudication over the settlements and unilaterally nullify them, is the question that alone comes

up for consideration by us. Suffice it to point out that what the respondents have done is not only unorthodox, but also not fitting in with any

precept of law. The respondents cannot by issuing the proceedings impugned, adjudicate over the settlements and unilaterally set at naught the

settlements apparently fitting in with the provisions of the Act. There is a total lack of jurisdiction and competency in law in this regard. This factor

alone, in our view, should weigh with us, for purposes of deciding these cases. There is no need for us to travel beyond this.

I also had occasion to consider a similar question in W.P.Nos.377 and 965 of 1997; (Arumuganeri Salt Workers Co-op. Society v. The

Deputy Register of Co-op. Societies Tiruchendur - Order dated February 24, 1998), wherein I have followed the Bench decision extracted

above. In view of the above legal position, it is declared that the settlement arrived at between the Society and its employees are not liable to be

unilaterally set aside by the respondents, nor can they initiate proceedings u/s 153 of the Co-operative Societies Act, nor any proceedings u/s 81

of the Act could be initiated for recovering the amount from the persons in management for allegedly paying excess amount to the employees on

the basis of the settlements. The writ petitions are ordered as indicated above. No costs. Connected W.M.Ps. that are pending in these W.Ps. are

closed.