| SooperKanoon Citation | sooperkanoon.com/438024 |
| Subject | Constitution |
| Court | Andhra Pradesh High Court |
| Decided On | Apr-29-2005 |
| Case Number | Writ Petition No. 14612 of 2004 |
| Judge | G. Yethirajulu, J. |
| Reported in | 2005(5)ALT126 |
| Acts | Andhra Pradesh Cooperative Societies Act, 1964 - Sections 116AA, 116C and 116C(1); Crown Proceedings Act, 1947; Regulating Act, 1773; Indian High Courts Act, 1861 - Sections 9; Government of India Act, 1915 - Sections 106; Government of India Act, 1935 - Sections 223; Indian Independence Act 1947; Specific Relief Act, 1877 - Sections 45; General Clauses Act, 1897; Andhra Pradesh Shops and Establishments Act - Sections 47; Uttar Pradesh Co-operative Societies Act, 1965; Uttar Pradesh Co-operative Land Development Bank Act, 1964; Tamil Nadu Co-operative Societies Act, 1961; Constitution of India - Articles 12, 14, 21, 32, 226 and 367(1); Andhra Pradesh Co-operative Societies Rules - Rule 72(3) |
| Appellant | Sadhu Varahala Babu and ors. |
| Respondent | Government of A.P., Co-operation Department and ors. |
| Appellant Advocate | V. Ajayakumar and ;G.V. Shivaji, Advs. |
| Respondent Advocate | G.P. for Respondent Nos. 1 to 4, ;Bobba Vijayalakshmi and ;M.R. Tagore, Advs. for Respondent No. 5 |
| Disposition | Petition dismissed |
G. Yethirajulu, J.
1. These writ petitions are filed by the employees of various co-operative societies contending that they were illegally terminated by the respective societies without following the procedure prescribed under law or the principles of natural justice, therefore, they requested to issue writ of mandamus declaring the orders of their termination from service as illegal, arbitrary and contrary to the provisions of the Act and violative of Articles 14 and 21 of the Constitution of India.
2. The respondents contended that the orders of termination have been passed by following the provisions of the Act and the instructions given by the concerned authorities from time to time. Therefore, there is no illegality or arbitrariness in the orders of termination passed against the petitioners.
3. Since these matters involved similar questions of fact and law, I wish to answer a common question of law regarding the maintainability of the writ petitions initially and the merits of the writ petitions separately.
4. In the light of the contentions made by both parties, the following are the points taken up for consideration.
Points for consideration:
(1) Whether a writ of mandamus against a society registered under A.P. Cooperative Societies Act, 1964 is not maintainable under Article 226 of the Constitution of India?
(2) Whether the termination orders passed by the Respondents against the petitioners are liable to be quashed by way of issuing writs of mandamus?
Point No. 1:
5. The writ petitions are filed by the former employees of the c-operative societies registered under the A.P. Co-operative Societies Act, 1964. They are challenging the orders of termination passed by the management of the respective societies. The petitioners are contending that the writ petitions are maintainable under Article 226 of the Constitution of India. The respondents are contending that since the cooperative societies are not the organs of the State, or its instrumentalities, they will not come within the purview of the definition of 'the State' under Article 12 of the Constitution of India, therefore, these writ petitions filed under Article 226 of the Constitution of India cannot be maintained.
6. Before answering the issue regarding the maintainability of these writ petitions, I wish to refer to the origin and development of writs in England and India during the pre and post constitutional period.
Origin and Development of writs in England:
7. Writs may be concisely defined as 'Royal orders drawn in concise terms and put into writing'.
Blackstone defines a writ as
'a mandatory letter from the King in Parliament sealed with his Great Seal and directed to the Sheriff of the County wherein the injury is committed or supposed so to be, requiring him to command the wrong doer or party accused, either to do justice to the complainant, or else to appear in Court, and answer the accusation against him.'
Carter defines the 'writ' as follows:
It was the King's order to his liege, written on parchment and sealed with the Royal Seal, and disobedience of the writ was a contempt of the royal authority, and punishable as such.
8. According to the Webster's Dictionary, the meaning of 'writ' is:
a formal order in writing issued under seal in the name of a sovereign, Government, Court or other authority commanding an officer or other person to whom it is issued to do or refrain from doing some act specified therein.
9. Prerogative writs are writs, which were originally issued only at the suit of the king but which were later on made available to the subjects also. They were called 'prerogative' because they were conceived as being intimately connected with the rights of the Crown. The common law regards the Sovereign as the source or fountain of justice, and certain ancient remedial process of an extraordinary nature prerogative writ have from the earliest time issued from the Court of Queen's Bench Division in which the Sovereign was always present in contemplation of law.
10. The writ process had its origin in the European Continent, but it gradually developed on English soil in the Twelfth Century. It was embedded in the history of Common Law and Judicial Institutions in England. Any description of the Writs in India would be quite incomplete without giving a short sketch of the growth and development of writs in England.
Prerogative Writs in England
11. The writ was a command of the King in writing to the Sheriff addressed to the defendant to appear in the Court within the specific period. It appears that while all writs were commands issued in the name of the Crown, only the writs, which had a special relationship with the Crown, came to be known as 'Prerogative Writs'. It was by this system that the King's Court made legal justice supreme over the justice administered in other Courts. The Chancery was the Writ office of the Common Law Courts. Due to rapid increase in the number of suits, the Writs were also issued in a large number. As the complaints of the same kind came again and again before the Chancery, a Common Form of Writ was drawn for them. The prerogative writs were issued only when some cause was shown as distinguished from the original or judicial writs, which were used for suits between party and party and which were issued as of course. All the prerogative writs were not discretionary and some of them were issued as writs of right.
12. At a date yet unknown, the Chancery clerks collected the writs in a register. By the reign of Henry VI, the list was complete and in the next century, the printing press imposed upon in its final form. This procedure of prerogative writs was, however, substituted by the simple procedure of judicial orders in the year 1938 by the Administration of Justice Act. However, the new procedure of review by judicial order does not in any way alter the principles of law upon which prerogative writs had been issued.
13. By obtaining orders of the Court in the form of mandamus, certiorari, or prohibition, the Crown could ensure that the public authorities carried out their duties, and that inferior tribunals kept within their proper jurisdiction. These were essentially remedies for ensuring efficiency and maintaining order in the hierarchy of courts, commissions and statutory authorities of all kinds.
Writ of Mandamus
14. Mandamus means 'command'. The writ of Mandamus is a high prerogative writ of a most extensive remedial nature. It is, in form, a command issuing in the king's name from the High Court of Justice, directed to any person, corporation or inferior court or tribunal, requiring him or it to do a particular thing specified in it which appertains to his or its office and is in the nature of public duty.
15. The writ of Mandamus is not a writ of course or a writ of right but is, as a rule, discretionary. In exercising its discretion, the court will refuse the writ, if there is an alternative remedy at law, but the alternative remedy must be equally convenient, beneficial and effectual. In England, such alternative remedies include a petition of right (replaced by proceedings under Crown Proceedings Act, 1947); an appeal to a Court or Tribunal; an election petition; an execution and an action at law.
16. An order for mandamus will lie to compel public officials or a public body to perform any public duties, which they have failed to perform.
17. As Schwartz and Wade pointed out:
The important aspect of the prerogative remedies is that they belong exclusively to public law (with the exception of habeas corpus), their primary object being to make the machinery of Government work properly rather than to enforce private rights. This introduces a valuable 'public interest' element... in a suit for mandamus the Queen is calling for the proper discharge of some public duty. Although private persons are, of course, the real plaintiffs, the public character of the proceedings is more than a mere form.
18. By the Writ of Mandamus, the King's Bench could compel another court or any local official to duly perform the duties.
The Evolution of Writ Jurisdiction in India
(Pre-Constitutional Phase)
19. In India, the foundations of law cannot be traced to any one single system of jurisprudence. From the earliest time, there has been an influx of different races and nationalities into India. The Aryans, the Greeks, the Huns, the Afghans, the Mangols, the Dutch, the Portuguese, the French and the English, all came and left their impact in different ages. Of these, the English have, however, left a lasting impression on the culture and civilization of India.
Supreme Court of Calcutta
20. A Royal Charter dated 26th March 1774 was issued by George III (under 13 Geo III Cap 63 popularly known as Regulating Act) in pursuance of the Act of 1773, which established the Supreme Court at Calcutta. Its Judges were given the same jurisdiction and authority as were exercised by the King's Bench in England. Clause 4 of the Charter provided as follows:
'... and it is our further will and pleasure that the said Chief Justice and Puisne Justices shall severally and respectively... have such jurisdiction and authority as our Courts of King's Bench have and may lawfully exercise within that part of Great Britain called England by the Common Law thereof....'
21. Clause 21 of the said Charter authorized the Supreme Court of Calcutta for the first time in the history of India to issue prerogative writs. It provided: 'The Court of Requests and Court of Quarter Sessions established at Fort William and the Justices, Sheriffs and Magistrates appointed for the said districts are subject to the order and control of the Supreme Courts in such manner and form as the inferior Courts and Magistrates in England were by law, subject to the order and control of the Court of King's Bench and to that end the Supreme court is empowered to issue writs of mandamus, certiorari, procedendo and error to be directed to such Court or Magistrates.'
22. According to the provisions of Clause 21 of the Charter, the Supreme Court at Calcutta was authorized to issue four types of writs, namely, mandamus, certiorari, procedendo and error. It gave rise to another question -- whether the jurisdiction of the Supreme Court in the matter of issuing writs was confined to these four writs only. In fact, it is well known that the Supreme Court issued Writ of Habeas Corpus, which is also a high prerogative writ. As to the question from where the Supreme Court derived its authority and power to issue writ of Habeas Corpus, Justice Das In re Banwarilal Roy's case 48 CWN 766, has pointed out that this power was enjoyed by the Supreme Court under Clause 4 of the Charter of 1774, which conferred the power on the Chief Justice and Puisne Justices. The said Clause 4 gave to the Supreme Court of Calcutta as wide a power as the Court of King's Bench enjoyed in England.
Supreme Court of Madras and Bombay
23. In 1800, the Recorder's Court at Madras was abolished. The Supreme Court of Madras was established under Clause 8 of Madras Supreme Court Charter, 1801 by repealing the provisions of Calcutta Charter of 1774. Clause 4 of the Charter of 1774 was reproduced in Clause 8 of the Madras Charter of 1801. The provisions of Clause 21 of the Calcutta Charter were reproduced in Clause 47 of the Madras Charter.
24. The Charter of 1823 authorized the abolition of the Recorder's Court at Bombay and the establishment of the Supreme Court of Judicature in its place to consist of a like number of Judges as the Supreme Court at Fort William in Bengal. The provisions of Clause 4 and Clause 21 of the Calcutta Charter 1774 were also reproduced in Clause 13 of the Bombay Charter of 1823. Thus, the powers of the Supreme Court at Madras and Bombay in issuing high prerogative writs were placed upon on equal footing with those of the Supreme Court at Calcutta.
The Indian High Courts and the writ jurisdiction
25. In 1862, the Indian High Courts Act was passed. It established Courts at Calcutta, Madras and Bombay in which the Supreme Courts as well as Sadar Dewani Adaulat and the Sadar Nizamat Adaulut were merged. Under the same Act, the High Court of Allahabad was established for the first time by Letters Patent issued on March 17, 1866. Its foundations were not based on any Supreme Court just as they did in the case of the three Presidency High Courts. It could not therefore claim to have inherited the powers and jurisdiction of the Court of King's Bench, which was possessed by the Supreme Courts, whose place the three Presidency High Courts took over. The difference is quite apparent from the Letters Patent granted to it. The Letters Patent of the High Courts of Patna established in 1916, of Lahore in 1919, of Rangoon in 1922 and of Nagpur in 1936, do not differ materially in their terms and all of them came practically within the same category.
26. The jurisdiction and powers of the High Courts were provided under Section 9 of the Act of 1861 as follows:
Each of the High Courts to be established under this Act shall have and exercise ... all jurisdiction and every power and authority whatsoever in any manner vested in any of the Courts in the same Presidency abolished under this Act at the time of the abolition of such last mentioned Courts.
27. The letters patent of 1862 were superseded by fresh letters patent, dated 23rd December 1865 and the powers and jurisdiction remained the same as were given under Section 9 of the Indian High Courts Act of 1861. These provisions were reproduced with slight modification in Section 106 of the Government of India Act, 1915. The same principle was maintained under the Government of India Act, 1935.
28. The powers and jurisdiction of the High Courts were given under Section 223 of Govt. of India Act, 1935 as follows:. The jurisdiction of and the law administered in any existing High Courts, and the respective powers of the Judges thereof in relation to administration of Justice in the Court, including any power to make rules of Court and to regulate the sittings of the Court and of members thereof sitting alone or in division Courts, shall be the same as immediately before the commencement of Part-III of this Act.
29. The power to issue writs in India was confined to the three Chartered High Courts of Calcutta, Madras and Bombay only and was not processed by any of the other Indian High Courts.
Courts under the Indian Independence Act 1947
30. The division of the Country into the two dominions of India and Pakistan which followed as a result of the Indian Independence Act 10 and 11 Geo. VI, c. 30 of 1947 effected important changes in the administration of the country. The old Federal Court became the Federal Court of the Dominion of India, and a new Federal Court was established for Pakistan. The High Courts of Lahore and Calcutta became respectively the High Courts of West Punjab and West Bengal and new High Courts for East Punjab and East Bengal were established.
31. Thus, the power to issue writs was limited to the three Presidency High Courts of Calcutta, Bombay and Madras, as successors of the old Supreme Courts. From 1865 to 1947, though the Crown newly established several High Courts they were not given the power to issue prerogative writs in India. Even the writ issuing powers of the three Presidency High Courts were restricted by the Specific Relief Act, 1877. Section 45 of the Specific Relief Act, 1877 provided that the High Courts of Calcutta, Madras and Bombay will not have power to issue the writ of Prohibition and Certiorari or order outside the local limits of their original civil jurisdiction.
32. The Indian Constitution brought about many changes in the writ jurisdiction of the Courts, therefore the development of writ jurisdiction in India during the post-constitutional period is dealt with in the next few paragraphs.
Writ jurisdiction in the post-constitutional period in India
33. The confining of the jurisdiction to the three Presidency High Courts in a way amounted to curtailment of the fundamental rights of the subjects and there was constant demand for the extension of this jurisdiction to the other High Courts.
34. The Constitution of India, 1950, has empowered the Supreme Court and all the High Courts of India to issue writs in the nature of Habeas Corpus, mandamus, prohibition, certiorari and quo-warranto. Under Article 32 any person can move the Supreme Court to issue directions or orders or writs for the enforcement of any of the Fundamental Rights as stated in Part III of the Constitution. The right to move the Supreme Court is itself made a Fundamental Right, which even the State cannot suspend the right except as provided by the Constitution. Under Article 226, all the High Courts in India are empowered to issue writs for the enforcement of any of the Fundamental Rights as guaranteed under Part II of the Constitution.
Powers of High Courts to issue writs
35. Article 226, subsequent to the Forty third and Fortyfourth Amendment Acts, reads as under:
226. Power of High Courts to issue certain writs:
(1) Notwithstanding anything in Article 32 every High Court shall have power, throughout the territories in relation to which it exercises jurisdiction, to issue to any person or authority, including in appropriate cases, any Government, within those territories directions, orders or writs, including (writs in the nature of habeas corpus, mandamus, prohibition, quo-warranto and certiorari, or any of them, for the enforcement of any of the rights conferred by Part-III and for any other purpose.)
(2) The power conferred by Clause (1) to issue directions, orders or writs to any government authority or person may also be exercised by any High Court exercising jurisdiction in relation to the territories within which the cause of action, wholly or in part, arises for the exercise of such power, notwithstanding that the seat of such government or authority or the residence of such person is not within those territories.
(3) Where any party against whom an interim order, whether by way of injunction or stay or any other manner is made on, or in any proceedings relating to, a petition under Clause (1), without--
(a) furnishing to such party copies of such petition and all documents in support of the plea for such interim order, and
(b) giving such party an opportunity of being heard,
makes an application to the High Court for the vacation of such order and furnishes a copy of such application to the party in whose favour such order has been made or the counsel of such party, the High Court shall dispose of the application within a period of two weeks from the date on which it is received or from the date on which the copy of such application is so furnished, whichever is later, or where the High Court is closed on the last date of that period, before the expiry of the next day afterwards on which the High Court is open; and if the application is not so disposed of, the interim order shall, on the expiry of that period, as the case may be, the expiry of the said next day, stand vacated.
(4) The power conferred on a High Court by this Article shall not be in derivation of the power conferred on the Supreme Court by Clause (2) of Article 32.
36. It now provides that every High Court shall have powers throughout the territories in relation to which it exercised jurisdiction, to issue to any person, authority or Government, directions, orders or writs including writs in the nature of Habeas Corpus, Mandamus, Prohibition, Certiorari and Quo Warranto or any of them, for the enforcement of Fundamental Rights conferred by Part III of the Constitution and for any other purpose.
37. Clause (2) of Article 226 clarifies that the High Court will have jurisdiction even in cases where the cause of action arises within its territorial jurisdiction but the seat of the Government or authority or residence of the person petitioned against is not within those territories.
38. The High Court under Article 226 and the Supreme Court under Article 32 are empowered not only to issue five 'prerogative writs' of English Law but also such other directions, orders, as may be appropriate in the circumstances of each case., Anwar Ali v. State of West Bengal; : AIR1952Cal150 ; Iram v. State of Madras; AIR 1961 SC 1738
39. The very wide language of Article 226 of the Constitution of India occurring as it does in a primordial document like the Constitution must be given its full meaning. A writ under Article 226 of the Constitution would be available not only against an authority or Government, but also against a private person. The restrictive meaning suggested to be given to the word 'person' occurring in Article 226 would render that word a surplusage because according to that interpretation the word 'person' can only mean another governmental authority. The rule of interpretation that the meaning of a word should be ascertained from the association it keeps cannot, therefore, be applied to the word 'person' occurring in Article 226 of the Constitution. The above considerations would clearly liberate the writ jurisdiction under Article 226 of the Constitution from the limiting constrains of the dictum of Atkin L.J., in R. v. Electricity Commissioner, (1924) 1 KB 171. It is therefore to be held that in appropriate cases a writ under Article 226 of the Constitution could be issued even against private persons.
40. The State power, to render justice between a citizen and a citizen, and between a citizen and the State belongs to the constitutional courts of India more by reason of their establishment and less by reason of conferment of power by the co-ordinate organs of the State acting under the Constitution (constituted Courts). Renunciation of such jurisdiction cannot easily be justified. Some of the aforementioned cases drew a picture of dreadful consequences as flowing from giving a wider meaning to the word 'person'. There is no scope for any such apprehension so long as we understand that the power under Article 226 of the Constitution is exercised on the basis of its public law foundation and the field of public law is clearly different from the field of private law.
41. In Re Nagabhushan Reddy, : AIR1951Mad249 the petitioner applied for the issuance of a Writ of Prohibition against the election of subcommittee of the All India Congress Committee, the president of the Andhra Provincial Congress Committee and Ors. prohibiting them from holding Congress primary panchayat elections in the district of Guntur. The Division Bench of the Madras High Court on the basis of the English Doctrine of Atkin L.J. ruled that no writ would lie against the Congress Party because it was not a public body entrusted by the law of the land with powers and duties relating to the rights of the people. The principle of this leading judgement was followed by several cases in several Courts of India.
42. In Narasimham v. Chicacole Cooperative Central Bank Limited, (1959) 1 LLJ 1554 purporting to follow the aforesaid Madras decision the A.P. High Court refused to quash an order terminating the services of a co-operative bank employee passed by its president. In that case, the petitioner applied for a Writ of Certiorari to quash the order of the President of the Co-operative Central Bank Limited, Srikakulam, terminating his services. The learned Judges referred to the judgment in Re Nagabhushan Reddy (24 supra) and ruled that an order of the President of a Co-operative Central Bank was not liable to be quashed as the law of the land did not entrust the President of a Co-operative society with powers to affect the rights of the parties. The learned judges observed.
'The writ which is available to an aggrieved party cannot be issued to private bodies or organisations like companies or co-operative marketing societies as in the present case.'
43. In Re S. Hariharan, : AIR1960AP578 the AP High Court held that as Writ of Certiorari could not be issued to a private body or tribunal having no judicial or quasi-judicial authority, no writ would lie against Hindustan Shipyard Ltd., terminating the services of its employees notwithstanding the fact that the Hindustan Shipyard Limited was owned up to 80 per cent of the shares by the Government of India and controlled by the Government of India through appointment of its Directors and issuance of instructions, advances and subsidies. The Court held that the above features of the Hindustan Shipyard Limited would not take away the distinct and separate jural entity of the limited company, which make it a separate legal person.
44. In M. Durgaiah v. Agent, Tandur Colleries, : AIR1961AP400 a Division Bench of the A.P. High Court held that merely because a statute or a rule having the force of a statute requires a company or some other body to do a particular thing, that company would not possess the attributes of a statutory body and accordingly no Mandamus could be issued to such a body.
45. In R. Lakshmi v. Neyveli Lignite Corporation, : AIR1966Mad399 where the Madras High Court held that a writ would not lie against the Neyveli Lignite Corporation to quash its orders terminating the services of its employees, because it was a private body without investiture of any sovereign powers of the State.
46. The ratio which underlies the above decisions was first articulated in R v. Electricity Commission (23 supra). In that judgment, Atkin, L. J., dealing with the nature of Writs of Prohibition and Certiorari said:
Whenever any body of persons having legal authority to determine questions affecting the rights of subjects, and having the duty to act judicially, act in excess of their legal authority, they are subject to the controlling jurisdiction of the king's Bench Division exercised in these writs.
47. The above observations would undoubtedly show that Atkin, L. J., intended that writs of Certiorari and Prohibition should issue only against persons having legal authority to determine questions affecting the rights of subjects, when those persons have a duty to act judicially. It is the principle of the above rule laid down by Atkin L.J., which was adopted by our Courts in the above-mentioned cases.
48. In T. Gattaiah v. The Commissioner of Labour, Hyderabad, 1981 (1) ALT 393 : 1981 (1) APLJ 280 (A.P.) Justice P. A. Choudary of A.P. High Court observed as follows:
It is partially true that Articles 32 and 226 of the Constitution of India are founded on the English System of prerogative writs. But this partially correct statement of law is subject to severe limitations dictated by the peculiar language employed by our Constitution in the above two Articles. Those Articles speak of directions, orders or writs including writs in the nature of Habeas Corpus, Mandamus, Prohibition, Quo-warranto and Certiorari. The addition of the word 'directions' is clearly an Indian innovation. Under Article 226 a writ would lie not merely against a governmental authority, but also against any person. Under the provisions of the General Clauses Act, 1897, which is made applicable by Article 367(1) for the interpretation of the Constitution, the word 'person' would include an incorporated body. Prima facie, therefore, a private person or an incorporated company cannot be taken out of the sweep and the contemplation of Article 226.
49. A body that can be called 'State' under Article 12 is amenable to writ jurisdiction under Article 32. Though Article 226 is not in Part III, this article empowers the High Court to issue writs to 'persons' to enforce ordinary rights. A writ of Prohibition/Certiorari will lie against a body, which is not judicial or quasi judicial and they are available against bodies clothed with such powers. The writ of certiorari cannot be issued against private persons even under Article 226. But Article 226 empowers High Court to issue directions against private persons also.
50. In a case S. Radhika Sameena v. S.H.O. Habeebnagar P.S., Hyderabad; : 1996(4)ALD1 of a lady commerce graduate who fell in love with a person by name Jameeluddin who married and made her to terminate her pregnancy and who refused to meet her on return from abroad, the High Court of Andhra Pradesh in a writ petition, through Justice M.N. Rao, observed:
A man who plays with the lives and careers of innocent women should be dealt with strictly in accordance with law. The law will catch up with such a person to punish him so as to be deterrent to all others of his ilk, who try to out-manoeuvre the legal system and treat women as play things meant for pleasure.
51. The Court directed the respondent to pay the compensation of Rs. Five lakh provisionally estimated. Though the order was against a private person, the respondents 1 to 3 who were Public Servants were directed to ensure compliance of the order. In this matter the Court entertained writ petition against a private individual and granted relief of compensation against him in the nature of mandamus.
52. The Court by utilising the word 'direction' available in Article 226 expanded the scope of this Article and held that an order can also be issued against private persons by granting appropriate relief under Article 226 of the Constitution.
53. The learned counsel for the respondents placed reliance on the following judgments in support of his contention that a writ does not lie against a cooperative society.
54. In SUM Prasad v. A.P. State Federation of Co-operative Spinning Mills Ltd., : 2001(6)ALD741 a Full Bench of this High Court while dealing with Article 12 of the Constitution of India held that the service rules of the federation have been made by the federation itself, which being akin to the bye-laws framed to the society will not have any statutory force. The violation of a statute or a statutory rule in the context of the A.P. Co-operative Societies Act would mean violation of the provisions of the State Act or Rules made thereunder. As has been noticed, the services of the petitioner are not protected under the said Act or under the Rules. Even if an authority performs a public function, writ may not lie. There is a distinction as to co-operative societies which are merely registered under the Co-operative Societies Act on one hand and those co-operative societies registered under the Co-operative Societies Act which are fully funded and controlled by the State and the conditions of service of its employees are governed by the statutory rules. Since the petitioner in this case was appointed and terminated under the service rules of the federation, the A.P. Federation of Cooperative Spinning Mills Limited does not come within the purview of Article 12 of the Constitution of India and it cannot be treated as a 'State.'
55. The question whether a society or a corporation including a co-operative society is a 'State' within the meaning of Article 12 of the Constitution of India or not is a question of fact. Some societies may be 'State' and some may not. This aspect of the matter has been considered by various High Courts. In Sri Konaseema Co-op. Central Bank Ltd. v. N. Seetharama Raju, : 1999(2)ALD13 a Full Bench of this Court held as follows:
Even if a society cannot be characterized as a 'State' within the meaning of Article 12, even so a writ would lie against it to enforce a statutory public duty which an employee is entitled to enforce against the Society. In such a case, it is unnecessary to go into the question whether the Society is being treated as a 'person', or an 'authority', within the meaning of Article 226 of the Constitution. What is material is the nature of the statutory duty placed upon it, and the Court will enforce such statutory public duty. (para 51)
The bye-laws made by a co-operative society registered under the A.P. Cooperative Societies Act do not have the force of law. They are in the nature of 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. However, in the matter of termination of service of the employees of a co-operative society, Section 47 of the A.P. Shops and Establishments Act provides a certain protection, and since the said protection is based upon public policy, it will be enforced, in an appropriate case, by this Court under Article 226 of the Constitution. Ordinarily, of course, an employee has to follow the remedies provided by the A.P. Shops and Establishments Act, but, in an appropriate case, this Court will interfere under Article 226, if the violation of a statutory public duty is established. It is immaterial which Act or Rule casts such a statutory public duty. (Para 51)
Mandamus, Certiorari and Prohibition are public law remedies. They are not available to enforce private law rights. Every act of a Society which may be a 'State' within the meaning of Article 12, does not necessarily belong to public law field. A society, which is a 'State', may have its private law rights just like a Government. A contractual obligation, which is not statutory, cannot be enforced by way of a writ petition under Article 226 of the Constitution. (Para 51)
56. In Thanikachalam M v. M.A.P.C.M. Society, 2001 (1) LLJ (Mad.) 285 a Larger Bench of the Madras High Court has considered this aspect of the matter and held as follows:
28. When the provisions of the Cooperative Societies Act give the right of appeal, revision and review, we do not find that some more power is to be added. We quite appreciate the argument, that efficacious remedy is to be made available to one and all, and even if exercise of power under Article 32 is limited, power under Article 226 can be invoked. But, where we want to emphasise is that the power under Article 226 cannot be allowed to be exercised, as a matter of course. Viewing in that angle, coupled with the well settled proposition of law enunciated in the judgment discussed earlier, we hold that writ petition against the orders passed under Co-operative Societies Act cannot be entertained as a matter of course.
36. ... As already stated, Cooperative Society is not an instrumentality of the State under Article 12 of the Constitution. So, no writ petition is maintainable. So far as the argument that a public duty is cast upon them is concerned, in such circumstances, only if there is any flagrant violation of the principles of natural justice, which is required to be followed as per the statute, writ can be maintainable. If these observations are looked into with the observations of the Apex Court, as stated, each case depends upon the facts and circumstances of its own.
57. The Larger Bench of the Madras High Court also held that the power under Article 226 has to be and should be extended to the helpless persons and that the technicalities should not come in their way. The litigant should not be the sufferer, in the absence of efficacious remedy. The Bench further observed as follows:
56. What is necessary to be seen is, if the order passed is without jurisdiction, or before passing any order, it is required to hear the affected party, as per the statute, but not followed, meaning thereby, if the principles of natural justice is not followed, or if there is any flagrant violation of law, or if situations warrant, due to the prevailing of monstrous situation, a writ petition can lie. It is also settled that before invoking the writ jurisdiction, the Court has to satisfy that some special circumstances exist to persuade it to deviate from the settled proposition of law regarding the exercise of writ jurisdiction under Article 226 and only in such circumstances, efficacious alternative remedy is not a bar to entertain a writ petition. At the same time, as stated above, mere mentioning that there is no efficacious alternative remedy will not give a right to invoke the extraordinary jurisdiction under Article 226 of the Constitution. That apart, we cannot lose sight of the fact that, it may not be possible to dispose of a writ immediately. Rather they may be pending for some years or even a decade. As such, the argument that they have no efficacious alternative remedy is not acceptable in toto and writ petition is not maintainable on that count also. It is also to be seen that while agitating that issue before the competent authority to avail efficacious alternative remedy, the other party will get an opportunity and also cross-examine the witness and one has to prove his case. Under the circumstances, a writ petition cannot be entertained to circumvent the other remedies available under the statute. So, no writ lies. Similarly, by merely using the word monstrosity, without making any specific averment that there is an outrageous or offensive wrong, no writ will lie, as the facts need investigation. However, no straitjacket formula can be followed, as each case depends upon the facts and circumstances of its own.
58. In G. Bassi Reddy v. International Crops Research Institute, : (2003)IILLJ1123SC the Supreme Court while dealing with the case of the society by name, International Crops Research Institute and the question whether a writ under Article 226 is maintainable in law, held that the Institute was neither set up by a statute nor are its activities statutorily controlled nor does it perform a public or statutory duty or a public function. Therefore, a writ petition filed against the Society by its employees was not maintainable.
59. In G.M. Kisan Sahkari Chini Mills Ltd. v. Satrughan Nishad, : (2003)IIILLJ1108SC the Supreme Court while dealing with the case of a cooperative sugar mill held that the form in which a body is constituted, namely, whether as a society or cooperative society or company is not decisive and the real status of the body with respect to the control of the Government is to be looked into. Applying the principles laid down in the case of Ajay Hasia v. Khalid Mujib Sehravardi, : (1981)ILLJ103SC to the facts of the case, the Supreme Court in Satrughan Nishad, : (2003)IIILLJ1108SC held that the appellant mill was neither an instrumentality nor an agency of the Government and hence was not an 'other authority' under Article 12 of the Constitution. The Supreme Court further held that in different facts/situations, different factors could be found to be overwhelming and indicative of whether the body is an 'other authority'.
60. The learned counsel for the petitioners placed strong reliance on the following judgments in support of his contention that a writ under Article 226 of the Constitution would lie against a cooperative society.
61. The aspect regarding the maintainability of the writ petitions can be divided into two categories - (1) writ petitions against State or its instrumentality, which falls within the definition of 'State' under Article 12 of the Constitution of India; (2) any other authority or person.
62. In Ch. Ankamma v. Registrar of Cooperative Societies, Hyd., : 2001(5)ALD13 a Division Bench of this High Court observed as follows:
The service conditions of an employee of the Bank were regulated by the statutory rules. In the situation, it was held that the Bank was an instrumentality of the State and the exercise of power of dismissal by the Society must be in accordance with the statutory regulations and with the approval of the statutory body.
63. In Pinapatruni Nagabhushanam v. Government of A.P., : 2002(6)ALD286 a learned single Judge of this Court while dealing with the subject under the A.P. Co-operative Societies and the question of maintainability of the writ petition under Article 226 of the Constitution of India held as follows:
The special byelaws governing the service conditions of a Secretary, are required to be and have been, issued by the society after having been framed by the Registrar as required under Rule 72 (3) of the Rules. As these Rules have been framed by the Registrar in exercise of powers available under the Statutory Rules, these Rules must be characterised as instruments having a statutory flavour and statutory underpinnings. Consequently, these Rules create rights and enjoin duties, which are enforceable and adjudicable in public law fora. On this analysis, specific service conditions, rights and liabilities of Secretaries of the Cooperative Societies allotted to such Societies under the decaderised disposition of Section 116-AA of the Act and in whose regard Rules have been framed by the Registrar under Rule 72 (3) of the Rules and have been adopted by the societies, are amenable to adjudication under public law parameters, including under Article 226 of the Constitution of India. (Para 17)
64. In Gayathri De v. Mousumi Cooperative Housing Society Ltd., : AIR2004SC2271 a Three Judge Bench of the Supreme Court while considering the maintainability of writ petition under Article 226 of the Constitution of India held as follows:
In a case where the co-operative society is under the control of a Special Officer, a writ would lie. Apart from that, Article 226 of the Constitution is not confined to issue of writ only to a public authority, the bar extends also to issue directions to any person. (Para 47)
65. The appellant filed a writ of mandamus directing the respondent not to give effect to a letter dated 1-11-1988 issued by the Special Officer of the Society and to forbear from acting on the basis thereof and pursuant thereto. In the said matter, the Supreme Court held as follows:
Since the subject matter of the writ petition is the order passed by the Special Officer appointed by the High Court in discharge of his statutory functions, the writ petition is maintainable under law. The Special Officer is appointed under the provisions of the Act and as such he is a statutory officer and therefore he should be regarded as a public authority. Apart from that, Article 226 of the Constitution is not confined to issue a writ only to a public authority, the bar extends also to issue directions to any person. In our opinion, in a case where the co-operative society is under the control of a Special Officer, a writ would lie.
66. In Ram Sahan Rai v. Sachiv Samanaya Prabandhak, : (2001)ILLJ1073SC a Clerk in a Co-operative Bank was removed from service for mis-conduct without affording an opportunity to defend himself. The Supreme Court while considering the matter in appeal held that the status of the District Co-operative Bank is of a Co-operative Society registered under the U.P. Co-operative Societies Act, 1965 and constituted under the U.P. Co-operative Land Development Bank Act, 1964. In the light of the rules, bye-laws and regulations, the State Government exercises all-pervasive control over the Bank and its employees are governed by the statutory rules prescribing the entire gamut of procedure of initiation of disciplinary proceedings, etc. Therefore, the Bank is undoubtedly an instrumentality of the State and hence amenable to jurisdiction under Article 226 of the Constitution.
67. In A. Umarani v. Registrar, Cooperative Societies, 2004 (1) Decisions To-day (SC) 738 the Supreme Court while dealing with the case relating to Tamil Nadu Co-operative Societies Act, 1961 left the issue open without considering the question whether the Cooperative Society is a 'State' within the meaning of Article 12 of the Constitution of India. The Supreme Court, however, held that it is beyond any cavil of doubt that the writ petition will be maintainable when the action of the co-operative society is violative of the mandatory statutory provisions.
68. In Ashok Kumar Singh v. BITC Organisation Ltd., : AIR1998Pat9 the Patna High Court has ruled that the Bihar Industrial and Technical Consultancy Organisation Limited (BITCO) is an instrumentality of the State by taking into consideration its Articles of Association and functions that (1) it was treated as a unit of the State Government under the rules of Executive Business, (2) that it is established to promote industrial growth in the State, which is a matter of governmental concern, (3) that the said body was set up to promote industrial growth also discharges governmental functions, (4) that the shares of BITCO are held by various statutory bodies which are instrumentalities of the Government and (5) BITCO is closely treated by IDBI which is another governmental instrumentality.
69. In Master Vibhu Kapoor v. Council of Indian School Certificate Examination, : AIR1985Delhi142 the Delhi High Court held that the Council of Indian School Certificate Examination is a society registered under the Societies Registration Act. It exercises a public function of imparting education. The council is deeply impregnated with governmental character not only structurally, but also functionally, therefore, the Council is an instrumentality of the State.
70. In U.P. State Co-operative Land Development Bank Ltd. v. Chandra Bhan Dubey, the Supreme Court held that the U.P. State Co-operative Land Development Bank is an instrumentality of the State, as it is controlled by the State Government and the service conditions of its employees are statutory in nature.
71. In G. Misra v. Orissa Association of Sanskrit Language and Culture, AIR 1971 Orissa 212 the Orissa High Court held that the Sanskrit Council constituted under a government resolution to hold examinations and publish results has been held to be subject to Mandamus because it performs a public, though not a statutory, duty.
72. In General Manager, United India Fire and General Ins. Co. v. Nathan, (1981) Lab. I.C. 1076 a Division Bench of the Madras High Court held that Certiorari or Mandamus may issue even to a private person or a body regarded as a government instrumentality even when it is incorporated or registered under a statute viz., a co-operative society or a limited company.
73. In Shri Anadi Mukta Sadguru S.M.V.S.J.M.S. Trust v. R. Rudani, : (1989)IILLJ324SC the Supreme Court made the following observations:
The law relating to Mandamus has made the most spectacular advance. Article 226 confers wide powers on the High Courts to issue writs in the nature of prerogative writs. This is a striking departure from the English law. Under Article 226 writs can be issued to any person or authority. It can be issued for enforcement of any of the fundamental rights and 'for any other purpose'. The term 'authority' used in Article 226 in the context must receive a liberal meaning unlike the term in Article 12. Article 12 is relevant only for the purpose of enforcement of fundamental rights under Article 32. Article 226 confers power on the High Courts to issue writs for enforcement of the fundamental rights as well as non-fundamental rights. The words 'any person or authority' used in Article 226 are therefore not to be confined only to statutory authorities and instrumentalities of the State. They may cover any other person or body performing the public duty. The form of the body concerned is not very much relevant. What is relevant is the nature of duty imposed on the body. The duty must be judged in the light of the positive obligation owed by the person or authority to the affected party. If the positive obligation exists on a particular authority, the mandamus cannot be denied. The mandamus cannot be denied on the ground that the duty to be enforced is not imposed by the statute. The mandamus is a very wide remedy, which must be easily available to redress injustice wherever it is found. Technicalities should not come in the way of granting the relief under Article 226.
74. Previously the High Courts used to refuse Certiorari or Mandamus to a body not regarded as an instrumentality of the State, which forms outside the scope of Article 12, but now it has been widened. There have been cases where Mandamus or Certiorari has been issued under Article 226 to such a body or a public utility service, or to enforce a statutory or public duty, or when it is discharging a function under some statutory provision. Thus, a writ of Mandamus or Certiorari can be issued to a company, or a co-operative society, or even a private person when it discharges functions under a statute.
75. Besides Article 12, the word 'authority' also occurs in Article 226. There has been a question for consideration of the Courts whether the term 'authority' in Article 226 ought to be interpreted in the same narrow sense as in Article 12 or more broadly than that. After several conflicting dicta, the position that emerged seems to be that Article 12 is relevant only for the purpose of Article 32 under which the Supreme Court can issue a writ only for the purposes of enforcement of fundamental rights. Article 226 is broader in scope than Article 32, as under Article 226 the High Court may issue a writ not only for enforcement of fundamental rights, but 'for any other purpose' as well. There may be a body, which may not fall within the compass of Article 12, but, nevertheless, it may still be regarded as an authority under Article 226 and may thus be subject to the writ jurisdiction of the High Court. This is made clear from the judgments of several Courts.
76. Under Article 226(1), the High Court is empowered to issue directions, orders or writs, including writs in the nature of Habeas Corpus, Mandamus, Prohibition, Quo-warranto and Certiorari for the purpose of enforcement of a fundamental right or for any other purpose. The power of the High Court is not confined only to issue of writs. It can also issue any directions to enforce any of the fundamental rights or for any other purpose. Thus, the jurisdiction conferred on a High Court is to protect not only the fundamental rights, but also any other legal right. Ordinarily, a writ of Mandamus or Certiorari is issued to a government instrumentality, whether statutory or not. But, the scope of Article 226 has been further widened by maintaining the writ petitions against other authorities and persons also.
77. The co-operative societies are established under the A.P. Co-operative Societies Act, 1964. The rules regarding the functioning of the societies were framed from time to time giving statutory recognition. The bye-laws of the societies are also given statutory flavour on account of their enforcement after getting approval from the Registrar of Co-operative Societies. Though the authorities of the State are not directly involving in the ordinary functioning of the societies, the authorities under the statute are regulating the functioning of the societies by fixing the staffing pattern, regulating the expenditure towards establishment charges, supervising the elections to the respective societies, conducting audit of the accounts of the societies, instructing the concerned authorities to take disciplinary actions against the erring officials and to reduce the members of the establishment in tune with the ceiling provided under the Act. In the first set of decisions mentioned in the aforementioned paragraphs, though the Courts held that a cooperative society is not a 'State' or 'other authority' under Article 12 of the Constitution, they did not put any embargo for treating it as 'an authority' mentioned under Article 226 of the Constitution and for issuing necessary directions by invoking powers under Article 226 of the Constitution. The second set of decisions are to the effect that a cooperative society would also come within the purview of Article 12 of the Constitution. Keeping in view the above trend of decisions rendered by various Courts, I wish to summarise as under:
(1) Article 226 empowers the High Court to issue writs to 'persons' or 'authorities' to enforce ordinary rights.
(2) An order can be issued against private persons by granting appropriate relief under Article 226 of the Constitution.
(3) Even if a society cannot be characterized as a 'State' within the meaning of Article 12, a writ would lie against it to enforce a statutory public duty.
4) In the matter of termination of service of the employees of a cooperative society, Section 47 of the A.P. Shops and Establishments Act provides a certain protection and since the said protection is based upon public policy, it will be enforced, in an appropriate case, by the High Court under Article 226 of the Constitution.
5) A writ can be maintained under Article 226 if there is flagrant violation of the principles of natural justice, which are required to be followed under a statute.
(6) The power of the High Court is not confined only to issue of writs to a public authority. It can also issue directions to enforce any of the fundamental rights or for any other purpose.
(7) The scope of Article 226 has been widened by maintaining the writ petition against other authorities and persons also.
(8) Mandamus under Article 226 may issue even to a private person or a body regarded as a government instrumentality even when it is incorporated or registered under a statute viz., a co-operative society or a limited company.
78. In the light of the above findings, I hold that even if a co-operative society is not treated as a 'State' within the scope of Article 12 of the Constitution, it can be treated as 'an authority' for the purpose of Article 226 of the Constitution and, therefore, a writ against a co-operative society under Article 226 of the Constitution of India can be maintained.
Point No. 2:
W.P.No. 14612 of 2004
79. This writ petition is filed seeking to issue a writ of Mandamus declaring the termination order dated 22-7-2004 passed by the 5th respondent-Kollimeru Primary Agricultural Co-operative Society removing the petitioner from service as illegal, arbitrary and contrary to the provisions of A.P. Cooperative Societies Act, 1964 and rules made thereunder and violative of Articles 14 and 21 of the Constitution of India and consequently to set aside the same.
80. The facts leading to the filing of the writ petition are briefly as follows:
On 13-7-1987 the petitioner was appointed as the Secretary of the fifth respondent society. In the year 1999 the regular Secretary was transferred to the society and the petitioner was asked to work as Additional Secretary. On 22-7-2004 the fifth respondent terminated the services of the petitioner on the ground that there is no required gross profit to pay the salaries of the staff in the society. As per Section 116-C of the Act and G.O.Ms.No. 308 dated 19-11-2003 and G.O.Ms.No. 94 dated 28-2-2004, the staff strength has to be reduced and the fourth respondent has instructed to implement the Government Orders and if they were not implemented, the amounts shall be recovered from them.
81. The fourth respondent issued the proceedings dated 9-1-2001 directing the fifth respondent to reinstate one R. Appa Rao as Cadre Accountant in the Society, and no termination orders were issued to him even though he is much junior to the petitioner. The fifth respondent society is constituted under the provisions of the A.P. Co-operative Societies Act, 1964 (for short 'the Act') and Rules made thereunder and the society shall function as per the bye-laws issued by the Registrar of Co-operative Societies and the service conditions of the employees are governed by the Special Bye-laws. As the salaries drawn by the employees of various Primary Agricultural Co-operative Societies are very less, the Government after deliberations and calling for the objections from the societies as well as its employees issued G.O.Ms.No. 82 dated 2-12-2000 wherein it has prescribed and fixed the minimum wages payable to various categories of employees working in Primary Agricultural Co-operative Societies.
82. The Government issued another Order vide G.O.Ms.No. 308, Agriculture and Co-operation (Co-op.VI) Department, dated 19-11-2003 directing sanction of Rs. 50,000/- loan by APCOB/DCCB to Primary Agricultural Cooperative Societies, which are not complying with the provisions of Section 116-C(1) of the Act for meeting the cost of management of the societies on certain terms and conditions with 6% interest on the expenditure and establishment charges, including staff salaries and allowances, which shall be met from the said amount of Rs. 50,000/- for the entire year. The said scheme proposed by the Government is not workable in view of the existing situation, as the societies cannot run and conduct its affairs without sufficient staff strength. The societies have not been allowed to meet the expenditure by way of fiscal limit imposed under Section 116-C of the Act.
83. The societies are directed to pay salaries to its employees only within Rs. 50,000/- and it would not be possible to the society even to maintain a single employee. The Government without taking into consideration the representations submitted by the employees union issued G.O.Ms.No. 94, Agriculture and Co-operation (Co-op.VI) Department, dated 28-2-2004 fixing the staffing pattern in the societies and the establishment charges to be incurred by the societies, thereby taking away the powers conferred by the statute on the co-operative societies.
84. So far as the Secretaries are concerned, they have been protected even if the societies are in losses and other employees are left to the mercy of the society. Under the guise of G.O.Ms.No. 94 dated 28-2-2004 the fifth respondent terminated his services, though the above Government Order does not contemplate that the staff of the society should be reduced by terminating them. Hence, the writ petition for the reliefs mentioned above.
85. The Sub-Divisional Officer, Person-in-charge Chairman of the fifth respondent society filed a counter-affidavit stating as follows:
86. Since there are no required gross profits in terms of Section 116-C of the Act and the society is running in loss, it is not possible to pay salaries to the employees of the society. Hence, the petitioner was served with the impugned orders dated 22-7-2004 terminating his services. G.O.Ms.No. 94 dated 28-2-2004 was issued directing sanction of loan by the A.P. State Co-operative Bank to help the society in paying the salaries to the staff. Act 2 of 1994 is made applicable to the cooperative societies with retrospective effect, therefore, the employees appointed after Act 2 of 1994 coming into effect are liable to be terminated. The petitioner has challenged G.O.Ms.No. 94 dated 28-2-2004 which was upheld by this Court through its judgment dated 6-8-2004 in W.P.No. 25318 of 2003. The co-operative societies are bound to implement the provisions of the Act. The societies cannot go beyond the stipulations imposed under Section 116-C of the Act. Hence the writ petition is liable to be dismissed.
87. The Co-operative Societies are primarily meant to advance loans to the agriculturists in the process of green revolution, but, unfortunately, many Societies have become rehabilitation centres for unemployed youth and the managing committees of the societies being unmindful of the consequences of appointing persons above the required strength without observing the norms of financial discipline and sanction from the concerned authorities have resorted to impose unbearable burden on the resources of the societies. The funds made available by the APCOB/DCCB for the purpose of loans to the agriculturists are being utilized for the salaries of the staff members of the respective Societies leading to losses in majority of the Societies. The interpretation of G.O.Ms.No. 94 dated 28-2-2004 by the petitioner that the said Government Order does not contemplate reduction of the staff by terminating the services of the employees of the Societies holds no water in the context of the developments leading to bankruptcy of the Societies. The existence of the Society depends upon its performance, attitude towards the agriculturists, helping hand by way of granting loans to eligible agriculturists and its efforts to recover the loans according to the schedule. There is a comment that the transparency of administration is lacking in the Societies and there are instances of the loans being not extended to the genuine farmers leading to the difficulty of recovery of the loans.
88. In Krishna District Co-operative Credit Societies Employees Union, Vijayawada, Vijayawada v. Commissioner for Cooperation and Registrar of Co-operative Societies, A. P., Hyderabad and Ors., : 2002(3)ALD108 a Division Bench of this Court while dealing with Section 116-C of the Act held as follows:
There is a laudable purpose and object behind enacting the said provision as most of the societies have indiscriminately made appointments of its employees, which resulted in virtual threat to the very existence and survival of the societies. Most of its financial resources were being spent to meet the expenditure in regard to the payment of remuneration, allowance, pay scales etc., to its employees. The Co-operative Societies are not organized, formed and incorporated for providing any employment as such to the unemployed. Their main purpose is to cater the need of the agriculturists for whose benefit they are organized and formed. They are meant to lookafter the welfare and the credit needs of their members. Promotion of economic interest of the agriculturists and rural artisans is the paramount consideration and of importance for which purpose the societies themselves are organised and brought into existence.
89. In A.P. State Co-operative Societies Secretaries and Employees Union v. Government of Andhra Pradesh, Agriculture and Co-operation Department, and Ors., : 2002(4)ALD527 a Division Bench of this High Court held that three-fourths of the Societies are running in losses and the paid secretaries and other staff of the Societies are drawing salaries irrespective of the margin of the interest available to the Societies to meet the said expenditure.... The Society is bound to keep its financial status and availability of resources in view, while making the appointment as well as fixing the staffing pattern, pay scales and other allowances for its employees.... G.O.Ms.No. 314 dated 26-12-2000 has received approval of this Court. Likewise, certain steps were taken to introduce Section 116-C of the Act in order to protect the interest of the Societies and its members and to prevent the societies from indulging in extravagant expenditure towards the salaries and other allowances payable to its employees. Since Section 116-C is not violative of the provisions of the Constitution of India, this Court held that the members of the Paid Secretaries Employees Union are not entitled for any pay scales or the revision of pay scales on par with Category-V Supervisors of District Co-operative Central Banks and that the Paid Secretaries are the employees of the concerned Societies.
90. It is an undisputed fact that the fifth respondent Society is not getting required gross profit in terms of Section 116-C of the Act and it is running in losses. It is also an undisputed fact that there is no money with the Society to pay the salaries and there is no adequate business turnover made by the Society. The petitioner worked as an Additional Secretary. He did not aver in the writ affidavit whether his appointment was approved by the Registrar of Co-operative Societies. Though the petitioner contended that there was a direction from the Government through G.O.Ms.No. 308 dated 19-11-2003 directing APCOB/DCCB to sanction Rs. 50,000/- towards loan to the primary agricultural cooperative societies which are not complying with the provisions of Section 116-C(1) of the Act for meeting the cost of the management of the Societies on certain terms and conditions to enable them to meet the entire expenditure from out of Rs. 50,000/- for the whole year, no material is placed whether any loan was released by APCOB/DCCB to meet the expenses. The petitioner's contention that the scheme covered by the above Government Order proposed by the Government is not workable and the Societies cannot conduct its affairs without sufficient staff cannot be accepted. The existing staff who were appointed without the sanction or ratification of the strength by the Registrar of Co-operative Societies are not entitled to question the action taken by the Society in compliance with the directions given by the Registrar of Co-operative Societies and in compliance of Section 116-C of the Act. G.O.Ms.No. 94 dated 28-2-2004 was issued by the Government to prevent the Societies from further financial losses and the staff pattern was fixed with reference to the financial viability of the Societies. Therefore, there is no force in the contention of the petitioner that the said Government Order has taken away the powers of the Cooperative Societies, which were conferred under the statute.
91. Since there is no material placed by the petitioner to show that his appointment was in pursuance of the sanction accorded by the Registrar of Co-operative Societies, he is not entitled to agitate that the impugned order is illegal.
W.P.No. 15546 of 2004
92. This writ petition is filed questioning the orders passed by the Person-in-charge Committee of the fifth respondent-The Chivemla Primary Agricultural Co-operative Society, Nalgonda District terminating the services of the petitioner from the post of a Clerk.
93. The petitioner contended that he was appointed as a Clerk in the fifth respondent society on 18-4-1993. He passed B.A. and also passed J.D.C. Apart from the petitioner, there is one Secretary working in the society. The area of operation of the society is 5 villages and the membership of the society is more than 5,000 and as such his services are very much required in the society for the day-to-day affairs of the society. A society having business average, loans outstanding, turnover more than 75 to 125 lakhs is entitled to have one Secretary and one Clerk and the limit on establishment charges has been prescribed at Rs. 80,000/-. The fifth respondent society is having average business turn-over of more than Rs. 80 lakhs. The fifth respondent conveniently interpreted the business turn-over of the society without calculating the interest accrued on the loans and thereby reduced the turnover of the society to below Rs. 75 lakhs contrary to the guidelines issued by the Reserve Bank of India and G.O.Ms.No. 94 dated 28-2-2004 and issued the termination proceedings dated 30-7-2004 to the effect that his services stand terminated w.e.f 31-8-2004. The petitioner having rendered more than 10 years of service has been terminated without any prior opportunity and without payment of service compensation as prescribed under the provisions of A.P. Shops and Establishment Act. Hence, the writ petition for a mandamus against the fifth respondent society for acting contrary to the orders issued by the Government in G.O.Ms.No. 94 dated 28-2-2004 and terminating the services of the petitioner without any prior opportunity and consequently to set aside the termination order dated 30-7-2004.
94. The Sub-Divisional Cooperative Officer and the Chairman of the Person-in-Charge Committee of the fifth respondent society filed a counter-affidavit mentioning as follows:
95. The petitioner was appointed as a Clerk in the society on 18-4-1993 through the resolution of the Managing Committee. The Government vide Act 22 of 2001 dated 25-4-2001 amended the Act and Rules and as per the said amendment Section 116-C (1) has been incorporated empowering the society to fix its staffing pattern, qualifications, pay scales and other allowances of its employees with the prior approval of the Registrar subject to the condition that the expenditure towards pay and allowances shall not exceed 2% of working capital or 30% of gross profit. The society comes under the group of first level i.e., up to Rs. 75 lakhs, for which the provision is made for one Secretary only in the staffing pattern prescribed in G.O.Ms.No. 94 dated 28-2-2004. The other averments made in the counter-affidavit are almost similar to that of the averments made in the counter-affidavit in W.P.No. 14612 of 2004.
96. The fourth respondent-Divisional Cooperative Officer, Nalgonda has also filed a counter-affidavit reiterating the version of the fifth respondent.
97. The petitioner in W.P.No. 15446 of 2004 was appointed on 18-4-1993. He did not place any material to show that his appointment was made after obtaining approval from the Registrar of Co-operative Societies. When once the appointment was made without following the procedure prescribed under law, the appointment cannot be treated as a legal one. Therefore, he is not entitled to question the impugned order as illegal.
W.P.No. 15451 of 2004
98. This writ petition is filed questioning the orders passed by the Person-in-charge of the fifth respondent -- The Cheedella Primary Agricultural Co-operative Society, Nalgonda District terminating the services of the petitioner from the post of a Clerk.
99. The petitioner contended that he joined the service of the society as a Clerk on 1-4-1996 on a consolidated pay of Rs. 600/-per month. Another person is working as a Secretary of the Society. The area of operation of the society is 20 villages and it is having an average business, loan outstanding with interest at Rs. 87,91,740-00; therefore, it is entitled to have one Secretary and one Clerk as staff and the limit on establishment charges has been prescribed at Rs. 80,000/-. The Chairman of the society has conveniently interpreted the business turnover of the society without calculating the interest accrued on the loans and thereby reduced the turn-over of the society to below Rs. 75 lakhs and showing the reason of low turnover issued the proceedings dated 30-7-2004 terminating the services of the petitioner w.e.f. 31-8-2004. The other averments made in the affidavit are similar to the averments made in Writ Petition No. 14612 of 2004.
100. The fourth respondent - Divisional Co-operative Officer, Nalgonda filed a counter-affidavit reiterating the averments made in the counter-affidavit in Writ Petition No. 15446 of 2004. He stated that since the turnover of the society is Rs. 46,884 lakhs, it comes under the group of the first level i.e, up to Rs. 75 lakhs, for which the provision is made for one Secretary only in the staffing pattern prescribed in G.O.Ms.No. 94 dated 28-2-2004 for obtaining the loan to meet the expenses of salaries of the employees.
101. The Sub-Divisional Co-operative Officer and the Chairman of the Person-in-charge Committee of the fifth respondent society filed a counter-affidavit reiterating the averments made in the counter-affidavits filed in the above writ petitions. He also stated that since the turnover of the society is Rs. 46,884 lakhs, the society comes under the first level i.e., up to Rs. 75 lakhs for which the provision is made for one Secretary only in the staffing pattern prescribed in G.O.Ms.No. 94 dated 28-2-2004 for obtaining the loan to meet the expenses of salaries of the employees.
102. The petitioner in W.P.No. 15451 of 2004 was appointed on 1-4-1996 subsequent to the ban imposed by the Government in filling up the posts in cooperative societies and reminded by the Registrar of Co-operative Societies through a Circular directing the societies to implement the ban orders. Since the petitioner was appointed subsequent to the imposing of the ban, he is not entitled to question the impugned order as illegal.
W.P.No. 15452 of 2004
103 This writ petition is filed questioning the orders passed by the Person-in-charge of the fifth respondent - The Suryapet Primary Agricultural Co-operative Society, Suryapet, Nalgonda District terminating the services of the petitioner from the post of a Clerk.
104. The petitioner contended that he was appointed as a Clerk on 26-2-1988 in the fifth respondent society. Another person is working as Secretary of the Society. The area of operation of the society is five villages and its membership is more than 7,000. It is having an average business and loan outstanding with interest at Rs. 89,18,159-00; therefore, it is entitled to have one Secretary and one Clerk as staff and the limit on establishment charges has been prescribed at Rs. 80,000/-. The Chairman of the society conveniently interpreted the business turnover of the society without calculating the interest accrued on the loans and thereby reduced the turn-over of the society to below Rs. 75 lakhs and showing the reason of low turnover issued the proceedings dated 30-7-2004 terminating the services of the petitioner w.e.f. 31-8-2004. The other averments made in the affidavit are similar to the one in Writ Petition No. 14612 of 2004.
105. The fourth and fifth respondents have filed a counter-affidavit almost reiterating the averments made in the counter-affidavits of the above writ petitions. They also averred that since the business turnover of the society is Rs. 67.871 lakhs, the society comes under the group of the first level i.e., up to Rs. 75 lakhs, for which the provision is made for one Secretary only in the staffing pattern prescribed in G.O.Ms.No. 94 dated 28-2-2004.
106. The petitioner in W.P.No. 15452 of 2004 claims that he is appointed as a clerk on 26-12-1998. He did not mention whether his appointment was made after getting approval from the Registrar of Co-operative Societies. As seen from the turnover of the business of the society, it is evident that it has no money to pay the salaries to its employees and the society has every power to terminate the services of the petitioner and accordingly did so, therefore, he cannot question the legality of the impugned order.
107. Though a writ under Article 226 is maintainable against a cooperative society, the statutory remedies are also available under the Act. The petitioners approached this Court directly without exhausting the statutory remedies. The petitioners ought to have approached this Court only after exhausting the statutory remedies. In view of the legal position, though the writ under Article 226 of the Constitution is not a total bar, it can be maintained only under special circumstances and it shall not be a matter of course. After going through the factual position relating to the case of each petitioner, I am of the view that the petitioners are not entitled for a declaration that the impugned orders are illegal or arbitrary or against the principles of natural justice.
108. In the result, the writ petitions are dismissed at the admission stage.