1. Rule, with the consent of the parties, writ petition is taken up for final disposal at admission stage.
2. The petitioners, who are 83 in number are raising exception to the order passed by the Joint Director (Administration), Handloom, Powerloom & Textiles, Maharashtra State, Nagpur in various applications tendered by them seeking permission to initiate proceedings by impleadment of liquidator of Amravati Cotton Growers Ltd. as respondent. The permission is sought for by the applicants as contemplated by Section 107 of the Maharashtra Cooperative Societies Act. It is contended in the application by the petitioners that they were formerly engaged by respondent No. 3 in various capacities like Supervisors, Clerks, Peons, Workers, etc. till the end of 1998 when the mill was in terms of agreement arrived at during the liquidation proceedings agreed to be sold in favour of respondent No.4. The services of the employees are stated to have been terminated by respondent No.3society without following procedure as contemplated by law nor the terms of so called agreement arrived at between the prospective purchaser i.e. respondent No. 4 and the society were adhered to nor the agreement between recognized union and respondent No. 3 was given effect, which has resulted in nonpayment of dues to the workers by the society. It is contended that in terms of the agreement arrived at between respondent No. 3 and respondent No. 4, the applicants were taken in employment sometime in the year 1998 and they remained in employment till 26/9/2001 when respondent No. 3 took back the charge of the mill on account of non fulfillment of the terms of the agreement by respondent No. 4. It is contended by the employees that although respondent No. 4 paid wages to them up to September, 2001. The closure of mill was not as contemplated by the provisions of the Industrial law as no permission was secured from the State Government as contemplated by Section 25(O) of the Industrial Disputes Act. It is contended that the employees are legally entitled to secure monetary benefits towards the wages and other dues from the liquidator who continues to hold control over the affairs of the society. It is further contended that the employees presented the complaint before the Industrial Court, Amravati under the provisions of MRTU & PULP Act, 1971 earlier, however, on account of want of permission as contemplated by Section 107 of the Maharashtra Cooperatives Societies Act, 1970, the complaint presented by the petitioners came to be dismissed by the Industrial Court on 31/1/2004. The petitioners thus approached the Registrar with a request to grant permission in accordance with provisions of Section 107 of the Societies Act. The Registrar respondent No.2 herein, after considering the contentions raised by the petitioners, proceeded to reject the application in view of the order dated 20/8/2003. The petitioners in this petition are raising exception to the order passed by respondent No.2 on various grounds.
3. I have heard arguments advanced by Shri S. D. Thakur, learned Counsel appearing for the petitioners, Shri A. C. Dharmadhikari, learned Counsel appearing for respondent No. 3 and Smt. I. L. Bodade, learned Assistant Government Pleader for respondents No. 1 & 2.
4. It is contended by the Counsel appearing for the petitioners that respondent No. 2 has committed material irregularity in rejecting the applications tendered by the petitioners seeking grant of permission as contemplated by Section 107 of the Maharashtra Cooperatives Societies Act, 1970. It is contended that the Registrar dealing with the application is not suppose to enter into the merits of the claim and the grant of permission is merely a formality and as a matter of course, the application tendered by the employees should have been allowed. It is contended that the Registrar has rejected the application tendered by the employees on wholly irrelevant considerations. It is not open for the Registrar to consider the issue of tenability of the claim or the merits of the claim proposed to be raised by the employees before the appropriate forum. The order also suffers from non application of mind to the record of the case. While rejecting the applications tendered by the applicants, the Registrar has ordered refusal to accord permission for presenting civil suit against the liquidator, however, in the application tendered by the employees, the permission was sought to sue the liquidator for securing wages/salary admissible to the employees by presenting appropriate proceedings either before the Labour Court, Amravati or any other appropriate forum. The Registrar, however, has rejected the application in respect of presentation of proceedings by the employees in the Civil Court. Placing reliance on various judgments delivered by this Court, it is contended that the order passed by the Registrar needs to be quashed and set aside.
5. The Counsel appearing for respondent No. 3 contends that the Registrar is not expected to deal with the application in a mechanical manner but while considering the application tendered under Section 107 of the Societies Act, the Registrar can very well consider the issue of tenability of the claim so as to avoid unnecessary litigation against the liquidator. The Counsel appearing for respondent No. 3 has supported the order passed by the Registrar. It is contended that the observations made by this Court in the judgments cited are in the facts and circumstances of the cases in the matters before the Court and it cannot be said that a general proposition is laid down which mandates Registrar to grant permission under Section 107 of the Act once a request is received, without consideration of merits of claim.
6. Having considered the submissions advanced by the respective Counsel appearing for the parties, I am of the view that the Registrar has committed error in rejecting the application tendered by the employees seeking permission as contemplated by Section 107 of the Mah. CoOp. Societies Act. On perusal of the application tendered by the employees, it is evident that the employees are requesting for grant of permission to proceed against the liquidator for recovery of dues payable to them on account of wages/compensation or other legally recoverable dues. The Registrar while dealing with the applications has observed in the order that the responsibility to make further payment to the employees and workers towards salary and wages rests with respondent No. 4 as the employees were employed by respondent No. 4 afresh. It is also observed in the order that the claims raised by the employees beyond the period of taking over possession by respondent No. 4M/s Navalji Cotspin Ltd., cannot be attributed to the liquidator or Society. It is also observed that taking back the possession of the mill by the liquidator due to breach of conditions of agreement to sale is a matter between the liquidator and the purchaser and it does not make the employees entitled to raise claim in respect of wages or other dues against the liquidator or Society.
7. On perusal of the application tendered by the applicant spetitioners herein, it transpires that they are making grievance in respect of no observance of the provisions of the Industrial Disputes Act by the liquidator. So far as the merits of the claim raised by the employees is concerned, the same has to be scrutinized by a proper forum dealing with the dispute that may be raised by the employees, It would be too premature to comment upon the merits of the claim at the stage of grant of permission to initiate proceedings against the liquidator, Even otherwise, it is not open for the Registrar to deal with the aspect of merits of the proposed claim by the employeespetitioners herein.
8. Considering the facts and circumstances of this case, there was no other option available to the Registrar except to accord permission. Issuance of the order according provisions of Section 107 of the Act is as a matter of course and it ought to have been granted by the Registrar. Reliance can be placed on the Judgment in the matter of Baburao Dadarao Kolhe & others v. State of Maharashtra and others reported in 2004 (2) Mh. L. J. 898. The Division Bench of this Court while dealing with the similar situation has observed in paragraph 3 of the judgment as under:
"It is not in dispute that the petitioners were in employment of the respondent No. 3 and were not paid their salaries for quite a long time, as the financial position of the respondent No. 3 was hopelessly bad. The petitioners workmen were justified in moving the Industrial Court, claiming the amount of wages. During pendency of the said proceedings, as an order of winding up came to be passed, the question of seeking leave of the second respondent arose by virtue of provisions of section 107 of the Maharashtra Cooperative Societies Act, 1960. Perusal of the order impugned reveals that the said order is a very cryptic order and the only ground stated therein for rejecting the application is that, if permission is granted to implead the society through the Liquidator as respondent before the Industrial Court, the same would result in putting in motion two proceedings, one before the Industrial Court and another before the Liquidator. What we find is that, if the proceedings before the Industrial court wherein the petitioners are claiming arrears of wages, are permitted to be concluded after impleading third respondent, as an opponent before the Industrial Court, the decision of the Industrial Court would crystalise the rights of the present petitioners and in that situation, the Liquidator would not be called upon to make any adjudication in regard to either the period, for which the petitioners have worked and/or in regard to actual amount, which the petitioners are entitled to receive from the third respondent. In this view of the matter in our opinion, there would be no possibility of two authorities, adjudicating on the same issue. An adjudication by a judicial forum, in matters pending prior to the passing of the order of winding up, would be desirable. In our opinion, the reasons put forth by the second respondent for rejecting the application, moved by the petitioners, under section 107 of the Maharashtra Cooperative Societies Act, 1960, are unsustainable in law. In such a situation, we are of the view that as a matter of course, the Registrar ought to have granted permission, prayed for by the petitioners under section 107 of the Maharashtra Cooperative Societies Act, 1960. Our attention is invited to a Judgment, reported in 2002 III CLR 981, wherein a Division Bench of this Court has doubted the very need for seeking leave of the Registrar under section 107 of the Maharashtra Co operatives Societies Act, 1960, for prosecuting complaints under M.R.T.U. and P.U.L.P. Act, 1971. We too voice our doubt about the application of section 107 to the proceedings pending on the file of the Industrial Court under the provisions of M.R.T.U. and P.U.L.P. Act, 1971. The Division Bench in the said Judgment, which is rendered in similar situation, held that as a matter of course, the Registrar ought to have granted permission. We are in respectful agreement with the view taken by the Division Bench. "
9. it is contended by the Counsel appearing for respondent No. 3 that in the reported judgment, the Court found that the reasons recorded by the Registrar are cryptic and the only ground stated therein for rejecting the applications is that if permission is accorded, it would result in putting in motion two proceedings, one before the Industrial Court and another before the liquidator. Although the Court has observed that no satisfactory reasons are recorded by the Registrar, the Court proceeded to observe that grant of permission is a matter of course and a doubt has been raised as regards necessity of securing permission for prosecuting complaint under the MRTU & PULP Act, 1971. The situation in the instant matter is not different than the reported matter. Although the reasons are recorded by the Registrar for his refusal to accord permission, those are wholly irrelevant and unacceptable. It is outside the scope of authority of the Registrar to deal with the merits of the proposed claim that would be raised by the employees. It is for the appropriate forum before whom the proceedings would be initiated to consider the legality and correctness of the claim. Allowing the Registrar to deal with such an aspect would amount to permitting the authority, dealing with application in respect of grant of permission, to prejudge the merits of the proposed claim and, according to me, it would not be permissible.
10. Following the ratio laid down by the Division Bench of this Court while dealing with writ petition No. 4355 of 2007 (Shri Dnyaneshwar Trust v. The State of Maharashtra & another) has observed as below:
"........Secondly, it has to be considered that the petitioner has merely sought permission to implead the liquidator as party to the execution proceedings. The liquidator, on his impleadment as opponent in execution proceedings, would be at liberty to raise all the contentions that are permissible under law and may have liberty to oppose the execution proceedings, There is no reason as to why permission sought for should be rejected. I am in respectful agreement with the view expressed by learned Single Judge while disposing of the petition referred to above. In a similar situation while dealing with writ petition No. 4082 of 2006 along with other companion matters, the learned Single Judge of this Court (R. M. Savant,
J.) while setting aside the order passed by the Registrar refusing permission as contemplated under Section 107 of the Act has observed in paragraph 11 of the judgment as under.:
"Another aspect to be considered is that the petitioners have merely applied for appointing the liquidator as party to the said execution proceedings as representing the original Defendant i.e. the Parner Sugar Factory. The Liquidator therefore would be entitled to take such stand as is permissible and available to him in law in the said execution proceedings. In my view therefore the Commissioner ought not have rejected the said application in the manner he has done."
11. Similarly, so far as instant matter also it would be open for the liquidator to raise appropriate contentions and put forth his defence in the proceedings which are proposed to be initiated by the petitioners before appropriate forum. The liquidator has liberty to raise appropriate contentions and it would be open for the appropriate forum to consider the contentions those would be raised by the liquidator and deal with the same. At the stage of consideration of application seeking permission to initiate the proceedings against liquidator, it would not be open for the Registrar to look into the aspects touching the merits of the proposed claim and those issues can be dealt with by the appropriate forum on initiation of appropriate proceedings by the petitioners/employees.
12. For the reasons recorded above, I am of the view that the order passed by the Joint Director (Administration), Handlooms, Powerlooms & Textiles, Maharashtra State, Nagpur dated 20/8/2003 needs to be quashed and set aside and the same is accordingly quashed and set aside. The applications tendered by the applicants petitioners before respondent No. 2 shall be deemed to have been allowed. Rule is accordingly made absolute. In the facts and circumstances of the case, there shall be no order as to costs.