Andhra HC (Pre-Telangana)
D.V.V. Satya Prasad And Ors. vs The Government Of Andhra Pradesh, Rep. ... on 16 November, 1995
Equivalent citations: 1996(1)ALT390
Author: Syed Saadatulla Hussaini
Bench: Syed Saadatulla Hussaini
JUDGMENT M.N. Rao, J.
1. At issue in this batch of writ petitions is the validity of Rule 73 of the Andhra Pradesh Co-operative Societies Rules, 1964 issued in G.O.Ms.No. 132, Agriculture and Co-operation (Co.-op. III) Department dated 3-3-1993 as amended by G.O.Ms.No. 212, Agriculture & Co-operation (Co-op III) Department dated 7-5-1994, which concerns the transfer of employees of the erstwhile Primary Agricultural Development Banks (for short "PADBs) to the service of the District Co-operative Central Banks (for short 'DCCBs'). Primarily, Rule 73 incorporates the guidelines for equation of posts and integration of services covering the gamut of cadre strength, notional and future promotions, options to be exercised by the employees, inter se seniority, continuity of service and other related matters. Certain employees of the D.C.C.Bs., have been resisting the absorption of the staff of the erstwhile P.A.D.B. employees on the ground that such absorption would affect, adversely, their service conditions and the statutory rule incorporating the principles for equation of posts and integration of services has travelled beyond the scope of Section 11 (2) (d) of the Co-operative Societies (sic. Laws Amendment) Act (for short "the Act"), Act No. 1 of 1987 by which the principal Act - the Andhra Pradesh Co-operative Societies Act, 1964 - was amended.
2. The controversy in these cases centres around the equation of posts in the cadres of Manager, Accountant and Supervisor prior to 1-4-1987, the following was the staff pattern in the respective organisations:
P.A.D.B. (L.T.) D.C.C.B. (ST.) Cadre Pay scale Total emoluments Cadre Pay scale Total emoluments minimum maximum minimum maximum Manager 675-40-995-45-1400 2,096 3,547 Asst. Gen. Manager 560-31-622-37-770-41 934-52-1142-61-1264 2,077 4,560 Secretary 460-25-610-30-730-35-940 1,539 2,906 Manager 454-25-504-31-628-37 776-42-944-52-1048 1,689 3,799 Asst. Manager, E.O., Engg.
Supervisor 410-20-490-35-640-28-780-30-870 1,452 2,710 Accountant 332-17-366-21-450-25-550-31-674-37-748-38-824 1,230 3,011 Accountant 340-18-41 2-20-492-25-617-28-757 1,262 2,394 Supervisor/ Typist 300-15-360-18-432-20-552-25-702 1,134 2,220 Clerk/ Supervisor/ Typist 264-11 -286-13-3 12-18-384-22-472-26-576-33-708 983 2,603 Driver 220-11-330-13-434 834 1,512 Driver 211-4-247-6-286-8-318-9-336-10-376 995 1,773 Peons/ Watchman 200-7-255-10 757 1,353 Peon/ Watchman 163-171-4-21 6-5-249-6-288 768 1,357
3. Even before the Rule 73 was framed, writ petitions were filed in this court challenging the action of the Government in accepting the recommendations of the One Man Commission headed by Sri V. Sunderesan, IAS., a senior civil servant, which went into the question and submitted its report. As all these cases are inter-linked, involving common questions for adjudication, we are inclined to dispose of the same by this common judgment.
4. Prior to 1-4-1987, credit facilities were made available to the rural agriculturists by two organisations with different staffing pattern. The short term credit was serviced by a three tier structure: at the village level, the unit was Primary Agricultural Co-operative Society (PACS); at the District level, it was District Co-operative Central Bank (DCCB); and at the apex level, it was designated as the Andhra Pradesh State Co-operative Bank. The long term credit facilities were made available by a two-tier structure: at the taluk level, the organisation was Primary Agricultural Development Bank (PADB) and at the apex level, the organisation was the Andhra Pradesh Co-operative Central Agricultural Development Bank Ltd. The Legislature of the State of Andhra Pradesh enacted Act No. 1 of 1987 introducing what was commonly called "Single Window System" integrating the long term and short term co-operative credit structures in order to revitalise co-operative institutions, as stated in the statement of objects and reasons. To achieve this objective, the statement of objects and reasons says, "It is necessary to reorganise the various co-operative institutions on the new pattern to ensure financial viability and easy access by the members to the co-operative institutions in the interest of better administration of democratic function. In the process, certain classes and levels of societies will be abolished and the functions, funds, assets and liabilities will be transferred to the newly formed Single Window Institutions...." Section 15-A of the principal Act was amended by Section 2 of Act 1 of 1987 conferring power on the Registrar "to amalgamate or merge any society with any other such society or to divide and restrict or transfer the area of operation of a society or to liquidate a society for any of the purposes mentioned therein. Section 11 of Act 1 of 1987 relates to abolition of Primary Agricultural Development Banks. Omitting the immaterial points, it reads:
"Section 11. Abolition of Primary Agricultural Development Banks: (1) With effect on and from the date appointed by the Government under Sub-section (2) of Section 1, the Primary Agricultural Development Banks registered under the Principal Act or deemed to have been registered under that Act shall stand abolished.
(2) On such abolition of a Primary Agricultural Development Bank under Sub-section (1),-
(a) ... ... ....
(b) ... ... ....
(c) ... ... ....
(d) the Registrar may transfer the officers and other employees who immediately before such abolition were in the service of the said Bank (including those belonging to a centralised service) to the service of the Financing Bank or to a Primary Agricultural Cooperative Society in the manner prescribed, Provided that-
(i) the terms and conditions applicable to such officers and other employees, consequent on their absorption in the service of Cooperative Central Bank or the Primary Agricultural Cooperative Society shall not be less favourable than those applicable to such employees immediately before such abolition as respects pay and allowances, leave, gratuity, provident fund and age of superannuation; and
(ii) the service rendered by any such officer or other employee under the said bank upto its abolition shall be deemed to be service under the Co-operative Central Bank or, as the case may be, the Primary Agricultural Co-operative Society and he shall be entitled to count that service for purpose of increment, leave or provident fund and gratuity."
5. The aforesaid provisions came into force on 1-4-1987. The Primary Agricultural Development Banks stood abolished with effect from date because of the legislative scheme contained in Section 11 (1). At present, both long term and short term loans are being serviced by the District Co-operative Central Banks through the Primary Agricultural Co-operative Societies. The Primary Agricultural Co-operative Society serves a group of villages; the District level body - the Co-operative Central Bank - is controlled by the Andhra Pradesh State Co-operative Bank. There are now 22 District Co-operative Central Banks.
6. As the implementation of the single window service scheme required integration of services of the personnel coming under the long term (PADBs) and short term (DCCBs) credit structures, the Commissioner of Co-operation had reported to the Government that as the "interests of the employees of the short term and long term structures appears to be at variance he proposes the appointment of One Man Commission to examine dispassionately all the issues relating to the integration of the services of employees of the Cooperative Central Banks and of the erstwhile Primary Agricultural Development Banks keeping in view the representations from the service Unions.' The Government, therefore, acceding to the request, appointed by G.O.Ms.No. 384, Food and Agriculture Department dated 19-5-1988 a One Man Commission with Sri V. Sunderesan, IAS (Retd.) as Chairman to examine all the issues relating to integration of the services of the employees of Co-operative Central Banks and of erstwhile Primary Agricultural Development Banks". The terms of reference of the Commission are incorporated in Paragraph 7 of the G.O., which reads:
"7. The terms and references of the Commission shall be as follows:-
(1) In the context of integration of District Co-operative Central Banks, Primary Agricultural Co-operative Societies and Primary Agricultural Development Banks, to study the integration of services including pay scales and recommend possible common pay structure, duly keeping in view the various demands of employees associations and viability of the future organisation and appropriate norms of expenditure.
(2) To make recommendations regarding fixation of inter-se seniority of the employees of the District Co-operative Central Banks and erstwhile Primary Agricultural Development Banks in the integrated cadre of the future.
(3) To keep in view the equation of various posts of erstwhile cadre and make suitable recommendations.
(4) To make such other recommendations as may be necessary for appropriate organisation structure, staffing pattern, future service regulations, time frame for the implementation and other relevant matters."
The Commission was asked to make its recommendations within a period of two months as far as possible.
7. Commission received representations from the service Unions afforded a personal hearing to the representatives and submitted on elaborate report after considering the qualifications of the two sets of employees the method of appointment, the nature of duties performed by them and the pay structure. The principles evolved under Section 115 (5) of the States Reorganisation Act for equation of posts and integration of services among the employees of the States affected by the States Reorganisation constituted the basic guidelines for the One Man Commission. Although the Government accepted in the beginning in toto the recommendations of the One Man Commission, later on, agreed for deviation in one particular respect viz., to equate the post of Manager, P.A.D.B. with that of the Manager D.C.C.B., instead of with the higher post of Assistant General Manager, D.C.C.B. and this was done because of the agreement reached between the rival associations To set right any imbalance that would creep in because of this deviation, the State Government, at the request of the two service unions, had agreed for creation of 107 posts of Assistant General Managers in the District Co-operative Central Banks, equivalent to the number of Managers of the erstwhile P.A.D.Bs., as on 31-3-1987 and to fill up these posts on the basis of common seniority of the Managers of the D.C.C.Bs., and the Manager and Secretaries of the erstwhile P.A.D.Bs., and accordingly, this was inserted in Rule 73.
8. Even as far back as 1987, a writ petition - W.P.No. 10846 of 1987 - was filed in this court challenging the action proposed to be taken by the Government- at that stage, the Government was finalising the scheme for absorption Quite surprisingly, a learned single judge of this court, by an interlocutory order dated 4-9-1987 in W.P.M.P.No. l4477 of 1987 directed the authorities "not to finalise the scheme for integration of services until the agreed draft scheme is placed before the court, which should be in three months from today" When W.P.No. 10846 of 1987,12744 of 1989 and 14115 of 1989 came up for hearing before a Division Bench of this court consisting of one of us (M.N. Rao J.) a representation was made on be half of the Government that be cause of the above order of the learned single judge, the statutory rule could not be framed finalising the scheme. The learned Government pleader also represented that a draft scheme prepared by the Government entitling it as Rule 73 was placed before the learned judge for his approval. As such a course of action suggested by the learned judge was impermissible in law, the Division Bench while declining to adjudicate upon the legality of the draft scheme submitted to this court, directed the State Government:
"without reference to the interlocutory order passed in WPMP No. 14477 of 1987 to finalise the matter and issue an appropriate rule within four weeks from the date of receipt of a copy of the order".
Subsequently, Rule 73 was issued and later on, in certain respects, it was modified. Rule 73 as it stands now incorporating the principles for equation of posts and related details is in the following terms:
RULE 73: TRANSFER OF EMPLOYEES OF ERSTWHILE PRIMARY AGRICULTURAL DEVELOPMENT BANKS TO THE SERVICE OF THE DISTRICT CO-OPERATIVE CENTRAL BANKS:
Consequent on the abolition of the Primary Agricultural Development Banks with effect from 1-4-1987, the Registrar shall transfer under Clause (d) of Sub-section (2) of Section 11 of the A.P. Co-op. Laws (Amendment) Act, 1987 (Act 1 of 1987) the Officers and Employees of erstwhile Primary Agricultural Development Banks (Including those under centralised cadre) to the services of the District Co-op. Central Banks concerned in which they are working as on the date of notification of this Rule. On receipt of such orders from the Registrar, the General Managers of the District Co-operative Central Banks shall communicate the same to all the concerned employees of the erstwhile primary Agricultural Development Banks. Thereafter, the General Managers of the District Co-op. Central Banks shall take the following action for integration of the services.
1. Equation of cadres: The Employees in the erstwhile Primary Agricultural Development Banks shall be equated with the cadres in the Co-op. Central Banks as hereunder and after integration, they shall be known by such designations as specified below namely:-
CADRES IN THE ERSTWHILE PRIMARY AGRL. DEV. BANKS EQUATED CADRE IN THE DISTRICT CO-OP. CENTRAL BANKS
1.
Manager and Secretary Manager
2. Asst. Manager, Executive Officer No equated post. This post will be kept as distinct fading category.
3. Engg. Supervisors No equated post. This post will be kept as distinct category.
4. Accountant Accountant
5. Asst. Accountant, Supervisor, Typist Supervisor, Clerk, Typist
6. Driver Driver
7.
--
Jamedar, Attender to be kept as distinct category.
8. Peon/ Watchman Peon, Watchman.
II. CADRE STRENGTH (Amendment dt. 7-5-1994) All the officers and employees of the erstwhile Primary Agricultural Development Banks working as on the 1st April, 1987 be absorbed in the equated cadre posts in the Dist. Co-op. Central Banks where they were working as on the 1st April, 1987. This will not apply to employees of erstwhile Primary Agrl. Dev. Banks already transferred by the Managing Director, A.P. Co-op. Central Agrl. Dev. Bank after 1st April 1987from one Dist. Co-op. Central Bank to another or employees in respect of whom issues transfer orders on requests received by him before the 23rd April, 1993 keeping in view the guidelines issued by the Commissioner for Coop. and Registrar of Co-op. Societies and they shall be absorbed in the District Co-op. Central Banks in which they joined later as per such orders. The total strength of each cadre in the Dist. Co-op. Central Banks shall stand increased to the extent of the number of employees of Primary Agrl. Dev. Banks absorbed in the cadre.
The posts of Assistant General Managers in the Dist., Co-op. Central Banks shall stand increased by 107 posts i.e., equivalent to the number of posts of Managers of erstwhile Primary Agrl. Dev. Banks in the District as on the31st March, 1987. These posts shall be filled on the basis of common seniority of the Managers of Dist. Co-op. Central Banks and the Managers and the Secretaries of the erstwhile Primary Agrl. Dev. Banks in the integrated cadre of managers of the Dist. Co-op. Central Banks duly observing the norms for promotions. The posts vacated by the 107 employees shall stand abolished on their absorption as Assistant General managers. The revised integrated cadre strength of the Dist. Co-op. Central Bank shall, however, be subject to revision according to any re-organised staffing pattern evolved for each District Co-operative Central Bank and also taking into account the legitimate business requirements of the Dist. Co-op. Central Banks, interest margins available and viability of the Dist. Co-op. Central Bank.
III. NOTIONAL PROMOTIONS:-
(a) The Managing Committee of the Dist. Co-op. Central Banks may fill up operational vacancies upto cadre IV as existing as on the 1st April, 1987 in the erstwhile Primary Agrl. Dev. Banks and in the Dist. Co-op. Central Banks by notionally promoting employees from the respective streams duly following the service regulations and general norms for promotions. The said operational vacancies shall be reckoned in terms of the posts in the Dist. Co-op. Central Banks and erstwhile Primary Agrl. Dev. Banks which were once filled by the institutions but became vacant later. The operational vacancies under short term and long term streams, that arose between 1st April 1987 to 31st October 1991 shall be filled up from the respective streams following the principle governing promotions. The posts required to be filled by direct recruitment shall not be considered while determining the operational vacancies for notional promotions.
(b) The consequential vacancies arising subsequent to the 31st October, 1991 from out of such promotions in all the cadres shall not be filled up till revised staffing pattern is evolved duly taking into account the legitimate business requirements, interest margins available and financial viability of District Co-op. Central Banks.
(c) The promotions will have only notional effect for reckoning the seniority in the integrated cadre and monetary benefit will be extended to the employees with effect from 1-1-1993.
(d) This process of the filling up promotional vacancies shall be completed by the Managing Committee of the Dist. Co-op. Central Banks within a reasonable time frame.
IV FUTURE PROMOTIONS:
The future vacancies of Managers in the Dist. Co-op Central banks shall be filled in by promotion from the common pool of Asst. Managers, Executive Officers or Accountants of erstwhile Primary Agrl. Dev. Banks and Accountants of the Dist. Co-op. Central Banks duly following the service regulations and general norms governing the promotions. The posts required to be filled in by direct recruitment shall not be considered for promotion.
V. OPTION:
(a) After receipt of orders of transfer to the services of Dist. Co-op. Central Banks, the employees of erstwhile Primary Agrl. Dev. Banks shall exercise option either to continue in the erstwhile Primary Agrl. Dev. Bank service regulations in respect of pay and other allowances as governing them as on the 1st April, 1987 or opt to the pay and allowances of Dist. Co-op. Central Banks till such time uniform pay scales and allowances are evolved. In such cases where they opt for pay and allowances of Dist. Co-op. Central Banks, the employees of erstwhile Primary Agrl. Dev. Banks shall be given wage parity with reference to the length of service in the equated cadre with the employees of the Dist. Co-op. Central Banks with effect from the 1st Jan. 1993. In case of non-monetary items such as disciplinary action, promotions and such other matters, the existing regulations as applicable to the employees of corresponding cadres of Dist. Co-op. Central Banks shall apply.
(b) The General Manager of the Dist. Co-op. Central Bank shall call for options of all the erstwhile primary Agrl. Dev. Banks personnel, by issue of individual notices, as well as by affixture on the notice board of the Dist. Co-op. Central Bank Head Office and its branches in the district. The erstwhile Primary Agrl. Dev. Bank personnel shall send their options to the General Manager within one month from the date of notice calling for such options.
(c) If the erstwhile Primary Agrl. Dev. Bank personnel opt for Dist. Co-op Central Bank pay and allowances, they shall be so governed with effect from the 1st January, 1993. If they opt for pay and allowances, gratuity and provident fund of erstwhile primary Agrl. Dev. Banks, they shall be so giverned till they get next promotion in the next cadre in the Dist. Co-op Central bank in the integrated set up. On such promotion they shall be governed by the District Co-op. Central Bank pay and allowances.
(d) If any one does not give any option either to the Dist. Co-op. Central Bank pay and allowances or erstwhile P.A.D. Bank pay and allowances within the time prescribed, they shall be governed by the erstwhile Primary Agrl. Dev. bank pay and allowances till such time they get promotion as per norms and on such promotion they shall be governed by the Dist. Co-op. Central Bank pay and allowances.
(e) The General Manager of the Dist. Co-op Central bank shall finalise the options of all the employees of erstwhile Primary Agrl. Dev. Banks within a period of two months from the date of receipt of such options from the employee.
VI. INTER-SE SENIORITY:
(a) The Inter se seniority of the erstwhile Primary Agrl. Dev. Bank employees of the Dist. Co-op. Central Bank employees in the equated cadres in each district shall be fixed by the General Managers, Dist. Co-op. Central Bank on the basis of dates of their appointment in the cadres in which they are working on regular basis including notional promotions. If the dates of such appointments happens to be the same, the seniority shall be fixed on the basis of the age, the elder being placed above the younger. However, in this process, inter se seniority of the Primary Agrl. Dev. Bank personnel and the inter se seniority of the District Co-op. Central Bank personnel shall not be disturbed.
(b) The General Manager, shall initiate action for fixation of inter se seniority, within six months of issue of order by Registrar of Cooperative Societies transferring the Co-operative Central Banks and give opportunity to all concerned to file objections, if any, within one month of publication of the inter se seniority and, after considering objections, issue the final list within four months.
VII. DISCIPLINARY CONTROL:
The Managing Committee of the District Co-op. Central Bank or the officer authorised but it, shall have powers over the employees of erstwhile PADBs transferred to the service of the Dist. Co-op. Central Banks in respect of disciplinary action, transfers promotions, sanction of leave etc., as per Dist. Co-op. Central Bank Employees Service Regulations.
VIII. CONTINUITY OP SERVICE:
132 The services rendered by the officers and employees of erstwhile Primary Agrl. Dev. Banks upto and from 1-4-1987 shall be deemed to be the service rendered in the DCC Banks to which they were transferred.
IX. APPEAL:
Any person aggrieved by any order of the General Manager of the DCC Bank may appeal to the Managing Committee of the District Co-op. Central Bank concerned and its decision shall be final and binding."
9. The petitioners' case was argued by M/s M.R.K. Choudhary, V.V.S. Rao, M.V. Durga Prasad, G. Veera Reddy, M.L. Narsu and others, while that of the respondents other than the State Government, by M/s N. Subba Reddy, K.V. Narasimham and R.M. Gopal Rao. The learned Government pleader advanced arguments for the State Government. The submission of all the learned counsel covered the entire gamut of the controversy.
10. For the petitioners, it was urged that the One Man Commission had committed a serious error at the threshold stage itself in adopting the principles evolved under the State Reorganisation Act with regard to equation of posts and integration of services of the employees of different States affected by the States Reorganisation. The Commission went beyond its terms of reference in the matter of equation of posts and integration of services between the two classes. The principles evolved under the States Reorganisation Act have no relevance at all in resolving the conflicting interests of the employees of D.C.C.Bs., and the erstwhile P.A.D.Bs. Section 11 (2) (d) of the Act protects only certain conditions of service of the employees of the erstwhile P.A.D.Bs., viz., pay and allowances, leave, gratuity, provident fund and age of superannuation. Although the second proviso to Clause (d) speaks of service as one of the protected conditions, the service rendered by the employees in P.A.D.Bs., was intended to be counted only for the purpose of retirement benefits but not intended to be reckoned for the purposes of promotion and seniority. Rule 73, which provided these benefits to the former P.A.D.B. employees, has travelled beyond the legislative prescription incorporated in Section 11 (2) (d) and, therefore, it is ultra vires the section. The service conditions of the petitioners were adversely affected by reason of the principles incorporated in Rule 73 for equation of posts and integration of services; the promotional prospects of the existing D.C.C.B employees have been marred to a very great extent thereby infringing their fundamental right under Article 16 of the Constitution of India. The posts of Manager, Accountant and Supervisor in the D.C.C.Bs. are fair higher than the posts of Manager, and Secretary, Accountant and Supervisor of the erstwhile P.A.D.Bs., in the case of the former, the duties performed, responsibilities shouldered and functions discharged are of a higher nature when compared with those of the latter. The superiority of the former is also reflected in the qualifications prescribed and the emoluments drawn vis-a-vis the latter. Rule 73 has treated both the categories irrationally; unequals cannot be treated as equals and, therefore, Rule 73 is liable to be struck down as violative of Articles 14 and 16 of the Constitution. Section 11 (2) (d) of the Act, which is claimed as the source of power for Rule 73, is at variance with the legislative prescription contained in Section 116-A of the Act conferring power on the Registrar of Co-operative Societies to constitute common cadres for posts in certain co-operative societies mentioned therein including co-operative banks. Section 15-A is a separate code by itself conferring power on the Registrar of Co-operative Societies to amalgamate or merge one society with another society or liquidate a society for reasons specified therein and in that process only he can change the service conditions of employees affected by such amalgamation or liquidation. Under Section 11 (2) (d), the Registrar has power to transfer officers and other employees of the P.A.D.Bs., who were in service before 1-4-1987, the date of abolition, "to the service of the financing bank or to a Primary Agricultural Cooperative Society in the manner prescribed". Rule 73 is concerned only with the equation of posts and integration of services between the employees of the D.C.C.Bs., and the employees of the erstwhile P.A.D.Bs. As the D.C.C.B. is not the financing Bank of the P.A.D.B., Rule 73, in its entirety must be struck down. Although proviso 1 to Clause (d) of Sub-section (2) of Section 11 refers to the absorption of the erstwhile P.A.D.B. employees with those of D.C.C.B. employees and proviso 2 deals with reckoning of the earlier service in the P.A.D.Bs. for certain purposes, these two provisos cannot control the provisions in the main Clause (d), and therefore, in the interpretation of Clause (d), the provisos must be totally excluded.
11. In opposition to these submissions, it was urged by the learned Government Pleader that when posts are equated and services integrated, there cannot be any mathematical precision. After considering all the aspects, the One Man Commission had submitted its report and the Government, excepting in one respect, had accepted the report of the One Man Commission. The exception was made because of the agreement between the rival service unions. The controversy which was raging from 1987has been amicably resolved when the rival unions came to an agreement in the interests of the members of both the unions, and the Government felt greatly relieved. But now a few disgruntled individual officers have approached this court advancing untenable pleas.
12. The learned counsel for the other opposite parties urged that the employees of the D.C.C.Bs. in the equated posts are in no way superior to the officers in the erstwhile P.A.D.Bs.
13. A general contention, obviously not intended to be pursued seriously, advanced at the threshold stage for the petitioners is that the Government have no power under the Act to frame a rule concerning the seniority of the employees. Sub-section (1) of Section 130 of the Act empowers the Government to make rules by notification published in the Gazette "for carrying out all or any purposes of this Act for the whole or any part of the State and for any class of societies". Undoubtedly, the P.A.D.Bs. and D.C.C.Bs., are societies under the Act. Interpreting Section 58 (1) of the Reserve Bank of India Act, 1934 which conferred power on the Central Board to make regulations consistent with the Act "to provide for all matters for which provision is necessary or convenient for the purpose of giving effect to the provisions of this Act", the Supreme Court held in V.T. Khanzode v. Reserve Bank of India, :
"It seems to us clear that it is not only convenient but manifestly necessary to provide for the service conditions of the Bank's staff in order to give effect to the provisions of the Act.... It is, in our view, not open to any question either on the basis of reason or authority that the power to provide for service conditions of the staff is at least incidental to the obligation to carry out the purposes for which the Bank was constituted." We, therefore, unhesitatingly, reject this contention.
14. The first contention so vigorously advanced for the petitioners that the One Man Commission went beyond its terms of reference is without any actual basis. G.O.Ms.No. 384 dated 19-5-1988 by which the One Man Commission was appointed lays down in specific terms in paragraph 4 that the Commission will examine "all the issues relating to the integration of services of the employees of Co-operative Central Banks and the erstwhile P.A.D.Bs." The other contention concerning the One Man Commission is that it committed a grievous error in adopting the guidelines evolved in regard to equation of pests and integration of services at the time of the States Reorganisation. In paragraph 4.04 of the report, it was stated:
"... the Commission also examined the principles and the guidelines which governed the equation of posts of the erstwhile Hyderabad Government and the erstwhile Andhra Government at the time of the formation of the enlarged Andhra Pradesh State. The principles which were laid down in this behalf were mainly as follows:
(i) The qualifications prescribed for direct recruitment to such posts;
(ii) The powers and the responsibilities of the posts.
(iii) The position in the hierarchy of the system.
(iv) Pay and allowances.
It may be seen that the factors that have been taken into consideration by this Commission in this regard are more or less in agreement with the principles which governed the equation of posts of Andhra and Telangana services though the dimensions of the two problems are not quite comparable."
The terms of reference as mentioned in paragraph 7 of G.O.Ms.No. 384 by which the Commission was constituted, extracted supra, are very comprehensive: the Commission after adverting to the terms of reference and after detailed discussions with the officials of the concerned departments, stated in para 2.02;
"After detailed discussions, I came to the conclusion that the terms of reference as set out in the G.O., are too wide in some respects and cover some issues which cannot possibly be the subject matter of study by this Commission".
The Commission, therefore, decided that its "task should be restricted only to the following two issues."
"(1) formulation of a possible common pay structure duly keeping in view various demands of employees' associations and viability of future organisation and appropriate norms of expenditure".
(2) make recommendation in regard to the appropriate organisational structure, staffing pattern, future service regulations, time frame for their implementation, etc."
15. The legality of the reasons stated by the Commission for confining its consideration only to these two issues is outside the purview of this batch of cases. We, therefore, do not propose to go into that question.
16. The issues formulated by the Commission are very pertinent covering the range of controversy between the two classes of employees and in the context of consideration of these issues, the Commission examined the guidelines followed with regard to the equation of posts and integration of services in the wake of the formation of the State of Andhra Pradesh on 1-11-1956 and expressed that the factors taken into consideration by the Commission were more or less in agreement with the principles evolved at the time of the formation of the State of Andhra Pradesh, "though the dimensions of the two problems are not quite comparable". The qualifications, powers and responsibilities, position in the hierarchical system and pay and allowances are undoubtedly crucial factors that must go into the estimate when posts are equated and norms are evolved for the purpose of consequential inter se seniority. In what respects these considerations are beyond the permissible range of the Commission, none of the learned counsel appearing for the petitioners could substantiate. The problem was viewed by the Commission, in our considered opinion, from the correct perspective. In a large number of cases arising under the States Reorganisation Act concerning equation of posts and integration of services of the employees affected by the re-organisation of the States, the Supreme Court upheld the principles as just and fair. Subba Rao v. Union of India - ; State of A.P. v. Rameshwar Prasad - .
17. The report of the Commission is an exhaustive one running into 65 pages exclusive of the annexures. It consists of 8 chapters. The first chapter deals with the structure of the two organisations, the service conditions of the employees and the position obtaining prior to Act 1 of 987. Chapter 2 deals with the scope of the report and the views of the associations are incorporated in Chapter 3. Chapters 4 and 5 relate to equation of posts and inter se seniority. What pay scales should be given to the former P.A.D.B. employees on absorption is dealt in Chapter 6. The other issues which are incidental like regularisation of certain number of employees, withdrawal of junior officers, payment of interim relief, sanction of selection grades for C.C.B. employees and other related matters are covered by Chapter 7. Chapter 8 contains the summary of the conclusions. In the final form, as incorporated in Rule 73, the equation is as follows:
" Cadres in the erstwhile Primary Agrl. Dev. Banks Equated Cadre in the Dist. Co-op. Central Banks.
1. Manager and Secretary Manager
2. Asst. Manager, Executive Officer No equated post. This post will be kept as distinct fading category.
3. Engg. Supervisors No equated post. This post will be kept as distinct category.
4. Accountant Accountant".
The reason for the change at the level of the Manager, as already stated supra, is the agreement of the two service associations and the creation of 107 posts in the cadre of Assistant General Managers in the D.C.C.Bs., equivalent to the number of Managers in the P.A.D.Bs., as on 31-3-1987.
18. The Commission taking the view that the protection of service given to P.A.D.B. employees under Section 11 of the Act should "logically be extended to cover seniority also" and after rejecting the plea of the D.C.C.B union that only to the extent of 2/3rds of the service of the P.A.D.B. employees should be counted, concluded in Chapter V that "the inter se seniority of the P.A.D.B. employees should be fixed in the equated cadres on the basis of the dates of their appointment in the cadres in which they were working on a regular basis including notional promotions, if any, on 1-4-1987".
19. The following comparative tables show the qualifications prescribed and the pay structure as on 1-4-1987 in respect of the posts in question as stated by the Commission:
STATEMENT SHOWING THE PAY STRUCTURE OF L.T. AND ST. CADRES AS ON 1-4-1987 P.A.D.B.(LT.) D.C.C.B. (S.T) Cadre Pay scale Total emoluments Cadre Pay scale Total emoluments minimum maximum minimum maximum Manager 675-40-995-15-1400 2,096 3,547 Asst. Gen. Manager 560-31-622-37-770-41 934-52-1142-61-1264 2,077 4,560 Secretary 460-25-610-30-730-35-940 1,539 2,906 Manager 454-25-504-31 -628-37 776-42-944-52-1048 1,689 3,799 Asst. Manager, E.O., Engg. Supervisor 410-20-490-35-640-28-780-30-870 1,452 2,710 Accountant 332-17-366-21-450-25-550-31-674-37-748-38-824 1,230 3,011 Accountant 340-18-412-20-492-25-617-28-757 1,262 2,394 Supervisor/ Typist 300-15-360-18-432-20-552-25-702 1,134 1,512.
Clerk/ Supervisor/ Typist 264-11-286-13-312-18-384-22-172-26-576-33-708 983 2,603 STATEMENT SHOWING QUALIFICATIONS, DUTIES ETC., OF LONG TERM & SHORT TERM CADRES AS ON 1-4-1987 P.A.D.B. (L.T.) D.C.C.B.(S.T) Cadre Method of appointment Qualifications Nature of duties Level of responsibility Cadre Method of appointment Qualifications Nature of duties Level of responsibility 1 2 3 4 5 6 7 8 9 10 Manager
(a) By promotion Service of not less than 5 years as Chief of all Bank No.1 in hierarchy Chief Executive Asst.
Gen Manager By promotion
(i) A matriculate with 5 years service as Manager Assisting and CM No.3 in hierarchy
(b) By Transfer Senior officer /Jr. officer of APCCADB Post. Grad.
(ii) Graduate with 2 years service as Manager
(c) By Direct recruitment Second class/ Degree l class with M.B.A.
(iii) Post Graduate with 1 year service as Manager Secretary
(a) By promotion Service of 3years as Asst. Manager/ Executive Officer Chief of all functions in the Bank No.2 in hierarchy Chief Executive Manager
(a) By promotion
(i) A matriculate with 5 years as Accountant Head of Branch Head or Head of No.4 in over-all incharge of Branch Section in the Office
(b) By transfer Staff Asst. in APOCAD Bank
(ii) Graduate with. 2 years as Accountant
(c) By direct recruitment A degree & diploma in Co-operation
(iii) P o s t --Graduate with 1 year service as Accountant
(b) By direct recruitment A Post Graduate Asst. Manager/ E.G.
(a) By Promotion Accountant with 3 years service Field inspection & Assisting Manager No. 3 in hierarchy
---
---
---
---
---
(b) By direct recruitment Graduate with Co-op. Training Accountant
(a) By promotion 3 years as Asst. Accountant or 6 years as Supervisor Maintenance of Accounts No. 4 in hierarchy Accountant By promotion H.S.C. & Cooperative Training
---
---
or 5 years as Asst. Acctt.
& Supervisor
(b) By direct recruitment Degree in Commerce Supervisor
(a) By promotion 3 years as Typist & Co-operative Fieldwork of Supervisor/ office work No. 5 in hierarchy Supervisor
(i) By promotion (90 % paid Secre-10% others in D.C.C.B.) H.S.C. & Co-op. Training To maintain accounts of Branch/ Sec. in Head office No. 5 in hier
(b) By direct Intermediate & Diploma in Co-operative or Degree in Commerce
(ii) By direct Recruitment Graduate with Co-operative training Original duties No. 6 in hiere primary supervising office for loans an recoveries
20. Among the P.A.D.Bs., in the two categories of Chief Executives viz., Manager and Secretary, some of the larger P.A.D.Bs., were in the charge of Managers while the remaining were managed by Secretaries and this depended upon the norms prescribed by the Registrar of Co-operative Societies: if the turnover of business was less than Rs. 50 lakhs, Secretary was appointed and if it was above Rs. 50 lakhs, Manager was appointed. Comparing this with the set up in the D.C.C.Bs., where there was only a single grade and they were posted in all the branches irrespective of the volume of the business, although the Chief Executive of the D.C.C.B. was the General Manager for purposes of equation, the Commission considered Managers as Chief Executives as they did not have the same independent status as the Managers of the P.A.D.Bs. There were to grades selection grade and special promotion grade - among the P.A.D.B. Managers besides the normal grade of Manager but the same was not the case with the D.C.C.B.
21. The post of Secretary in the P.A.D.B is the feeder category to the post of Manager. The P.A.D.B. Manager, being the Chief Executive in charge of an autonomous co-operative institution, was directly answerable to the apex institution. He was responsible for the sanction of long term loans to the individual farmers. Processing of the loan applications involve scrutiny of documents relating to immovable properties, a much more complicated task that the procedure involved in the sanction of short term or medium term loans by the D.C.C.Bs., where no security except a personal bond will be taken from the loanee. The P.A.D.B., was also responsible for the maintenance of loan ledgers of individual loanees and the follow-up action for recoveries. The main responsibility was on P.A.D.B., for implementation of larger schemes for area development, minor irrigation, I.R.D.P. schemes etc. As against these duties and responsibilities of P.A.D.B. Managers, the Manager of the D.C.C.B was only the head of the office which constituted a tier between the primary cooperatives and the Co-operative Central Banks. He had no independent role in the sanction of loans; this was performed by only certain categories of Managers in charge of higher grades in the rank of General Manager, and Deputy General Manager which are State wide cadres.
22. The post of Accountant in the P.A.D.B., was equated with the post of Accountant in the Co-operative Central Bank. It was observed by the Commission that the post of Accountant in the P.A.D.B. was the feeder category to the post of Manager whereas there are two levels between the Accountant and Manager in the D.C.C.B. and both of them were made eligible for promotion to the post of Manager in the integrated setup. The posts of Assistant Manager/Executive Officer and Engineering Supervisor in the erstwhile P.A.D.Bs., were allowed to remain as distinct categories which will fade out in course of time. On this aspect, there was no controversy.
23. The posts of Assistant Accountant Supervisor and Typist in the erstwhile P.A.D.B. were equated with Supervisor/clerk/typist in the D.C.C.B.
24. The criticism that emanated from the counsel for the petitioners against the Commission's report is that the Commission had ignored one important aspect that the D.C.C.Bs. were really doing banking business whereas the P.A.D.Bs., were only distributing long term loans. The area of operation of the P.A.D.B. was much smaller compared to the D.C.C.B. We are not inclined to accept this contention. Whatever banking business a D.C.C.B. does was only incidental to the main function of distributing short term loans whereas the P.A.D.Bs. were entrusted with the responsibility of distributing long term loans. The reasons given by the Commission, as noticed above, are sound and rational. Distribution of short term loans, which is the main function of the D.C.C.B. is much easier than arranging long term credit which involves scrutiny of documents follow-up action and other higher responsibilities. As regards the area of operation, although there were 22 District Co-operative Central Banks in the State as on 1-4-1987, they also had 440 branches in the State whereas the number of P.A.D.Bs. was 218. The jurisdiction of P.A.D.B. which was approximately confined to the erstwhile revenue taluk, was far wider compared to a branch of the D.C.C.B. the jurisdiction of which extends over a revenue mandal. We are not persuaded by the argument of the counsel for the petitioners that while considering D.C.C.Bs., we must take the District as a unit and since the branches are part of the District Head Office, they cannot be treated as independent units while considering the nature and responsibilities as well as territorial jurisdiction. As a general proposition of law, although it may be said that a body corporate and its branches are not distinct and separate units from each other, in the case of a Bank, operating through its branches, the latter are regarded for several purposes as separate and distinct entities from the Head Office, A.C. International Ltd., v. Custodian, Banco National Ultra Marino - .
25. The Accountant in the erstwhile P.A.D.B. used to prepare the accounts of the entire unit while his counter-part in the D.C.C.B. used to deal with transactions of specified subjects. The counter-affidavit filed by the State Government in W.P.No. 15288 of 1994 clearly brings out the comparative position:
".... the Secretary of the erstwhile PADB who is now equated on par with the Manager of the DCCB was the Chief Executive of the said bank answerable directly to the Apex Bank and the CC & RCS, whereas the Manager of the DCCB is in charge of a Branch, which is a part of Revenue Mandal and is answerable only to the General Manager of the DCB but not entering into any correspondence as was in the case of Secretary/ Manager of the erstwhile PADB. Similarly the Accountant of the erstwhile PADB will prepare the accounts of the entire unit while the Accountant in a DCCB is only for limited transactions of specified subjects. The Supervisor of the erstwhile PADB processes the loan application, arrange for disbursement of loans, its utilisation and recovery thereon, and the services of the supervisors in the DCCB are no superior than the services rendered by the supervisors of the erstwhile PADBS. As seen from the facts mentioned above, no supremacy of any cadre either of the erstwhile PADB or CCB can be claimed. However, due care was taken to safeguard the interests of the employees of both the wings at large."
26. The claim that the incidental performance of banking business by the DCCBs must entitle their employees to superior status when viewed in the over all context is devoid of merit. The object of establishing District Co-operative Central Banks in the co-operative sector was not for transacting banking business but only to strengthen the co-operative movement by financing short term loans to agriculturists. The funds for the disbursement of loans - either short term or long term - come from the NABARD, owned by the Government of India, the Reserve Bank of India and the State Government.
27. The contention that the principle of "functional equivalence and co-equal responsibility", the guiding factors laid down in N.P. Verma v. Union of India, , was violated does not merit acceptance. In the above case, the Supreme Court was concerned with the rights of the employees of the erstwhile Caltex Oil Refining (India) Ltd., ESSO Standard Refining Company of India Ltd., and Lube India Ltd., consequent upon their amalgamation with the Hindusthan Petroleum Corporation Ltd. The Supreme Court while laying down the principle of law that "while it is not within the domain of the court to make equation of posts for the purpose of integration, it is surely the concern of the court to see that before the integration is made and consequent fitment of officers in different grades /scales of pay is effected, there must be an equation of different posts in accordance with the principles stated above", found as a fact that in accordance with the aforesaid principle, equation of posts was not effected and, therefore, held:
"As there is no evidence or material in support of such equation of posts, it is difficult to accept the rationalisation scheme with regard to the placing of the officers of CORIL in different IOC/HPCL grades of pay".
This precedent is, therefore, clearly distinguishable.
28. Whatever injustice the D.C.C.B. employees felt was done to them because of the equation of the post of the Secretary of the PADB with that of the Manager of the DCCB was set right by the Government by creating 107 posts of Assistant General Managers in addition to the sanctioned strength for the purpose of accommodating the senior most personnel in the cadre of Managers of the integrated DCCB. The acceptance of the recommendation of the One Man Commission in all respects except the equation with regard to the post of Manager and the reasons for the deviation and the contemporaneous action taken to safeguard the interests of the DCCB Employees by creating 107 posts of Assistant General Managers cannot be said to be unjust or illegal. A comparison of the pay structure, the nature of the duties performed and the responsibilities shouldered, the functions discharged, the structure of the hierarchical set-up and the territorial jurisdiction over which the incumbents were required to operate fully justifies the equation of posts and integration of services as contained in Rule 73.
29. Equation of posts and integration of services per se is not unjustified. In this regard, the employer enjoys a certain measure of discretion. In S.B. Mathur v. Hon'ble C.J., Delhi High Court, , which relates to equation of certain posts in the High Court service, it was held by the Supreme Court:
"There is, therefore, nothing inherently wrong in an employer treating certain posts as equated posts or equal status posts provided that, in doing so, he exercises his discretion reasonably and does not violate the principles of equality enshrined in Articles 14 and 16 of the Constitution. It is also clear that for treating certain posts as equated posts or equal status posts, it is not necessary that the holders of these posts must perform completely the same functions or that the sources of recruitment to the posts must be the same nor is it essential that qualifications for appointments to the posts must be identical. All that is reasonably required is that there must not be such difference in the pay scales or qualifications of the incumbents of the posts concerned or in their duties or responsibilities or regarding any other relevant factor that it would be unjust to treat the posts alike or, in other words, that posts having substantially higher pay scales or status in service or carrying substantially heavier responsibilities and duties or otherwise distinctly superior are not equated with posts carrying much lower pay scales or substantially lower responsibilities and duties or enjoying much lower status in service."
30. Ever since the single window system was adopted by the State Government, efforts were being made to satisfy all the just demands of the employees in the realisation that discontentment among the employees would adversely affect the functioning of the institutions. After the agreement, reached by the two service unions, Rule 73 as it stands now was issued. Overwhelming number of the employees of the DCCBs seem to have been satisfied, but a few individuals, thinking that their chances of promotion would be adversely affected if Rule 73 was implemented in its present form, have been carrying on this fight. We do not find any basis for the apprehensions entertained by them. As the arguments were confined to the general legal questions and the staffing pattern of the two institutions - PADBs and DCCBs - we have not examined the case of any particular individual. There is no need to do so in view of Rule 73(IX) which provides for a right of appeal to the Managing Committee of the District Co-operative Central Bank against any order passed by the General Manager of the Bank. It must also be mentioned in this context that the right of promotion should not be equated with a mere chance of promotion. The right to be considered for promotion is a condition of service but not mere chance of getting promotion, See: Reserve Bank of India v. C.N. Sahasranama - . The Supreme Court in Reserve Bank of India's case,6 also cited with approval an earlier precedent in Kamal Kanti v. Union of India, , wherein it was held that in matters like formulation of seniority lists, justice should be ensured to as many as possible and injustice to as few and "it was not safe to test the constitutionality of a service rule on the touch-stone of fortunes of individuals".
31. Restating the well accepted proposition that in service matters, the rules made cannot satisfy each and every employee, the Supreme Court observed in V.T. Khanzode (1 supra).
"No scheme governing service matters can be fool-proof and some section or the other of employees is bound to feel aggrieved on the score of its expectations being falsified or remaining to be fulfilled. Arbitrariness, irrationality, perversity and mala fides will of course render any scheme unconstitutional but the fact that the scheme does not satisfy the expectations of every employee is not evidence of these ............Combined seniority is indispensable for the smooth functioning of the bank and no organisation can function smoothly if one section of its officers has an unfair advantage over others in matters of promotional opportunities ..................combined seniority has emerged as the most acceptable solution as a matter of administrative, historical and functional necessity."
The validity of the combined seniority of the officers in each of the separate groups was in issue in that case.
32. Both on principal and precedent, the claim of the petitioners that the equation of posts and integration of services was done unjustly is unsustainable. Rule 73 does not suffer from the vice of unconstitutionality either on the basis of Article 14 or 16 of the Constitution.
33. The next question for consideration is: whether Rule 73 is ultra vires Section 11(2) of the Act?
34. Sub-section (1) of Section 11 says that with effect from the appointed date, the Primary Agricultural Development Banks shall stand abolished. The consequences of such abolition are contained in Sub-section (2). Clause (a) of Sub-section (2) says that on abolition of the P.A.D.B. all rights and assets vesting in the bank and all liabilities against it shall devolve on the Co-operative Central Bank of the District concerned. Clause (b) refers to transfer to the D.C.C.B. of all contracts made by the P.A.D.B. prior to its abolition and subsisting on the relevant date. Clause (c) says that the members of the erstwhile P.A.D.B. shall be deemed to be the nominal members of the D.C.C.B. without the right to vote till their loans are discharged. Clause (d), with which we are concerned, empowers the Registrar to transfer officers and other employees immediately before such abolition in the service of the P.A.D.B. "to the service of the financing bank or to a Primary Agricultural Co-operative Society in the manner prescribed." Consequent on such absorption, the first proviso the Clause (d) says that the terms and conditions of the absorbed employees shall not be less favourable than those applicable to them immediately before such abolition as respects pay and allowances, leave, gratuity, provident fund and age of superannuation. The second proviso says that the service rendered by any officer or employee of the P.A.D.B., upto the date of abolition "shall be deemed to be service under the Co-operative Central Bank or as the case may be the P.A.C.S., and he shall be entitled to count that service for the purpose of increment, leave or provident fund and gratuity".
35. The argument vigorously pressed into service by the counsel for the petitioners was that only in respect of matters specifically referred to in the first proviso viz., pay and allowances, leave gratuity, provident fund and age of superannuation, protection was afforded to the employees of the erstwhile P.A.D.Bs and the counting of the service rendered by the in the P.A.D.Bs., shall be restricted, under the second proviso, only for the purpose of increment, leave, provident fund and gratuity. Equation of posts, integration of services arid inter se seniority are not the factors falling within the purview of Section 11(2)(d) and inasmuch as Rule 73 specifically incorporates these aspects, it is ultra vires the section.
36. We are unable to agree. The deeming aspect regarding service contained in the second proviso necessarily implies that the previous service rendered by the erstwhile P.A.D.B. employees would become, after 1-4-1987, service under the D.C.C.B. or the P.A.C.S., as the case may be. Although in the Section, P.A.C.S., is mentioned, there is no controversy that none of the erstwhile P.A.D.B. employees was transferred to any P.A.C.S. which functions only at the village level. Seniority is a necessary component of service. When service as a whole was protected by the second proviso, the expression "service" in the first proviso cannot be understood in a different manner. The second proviso after stating that the service in the erstwhile P.A.D.B. shall be deemed to the service in the D.C.C.B., particularly mentions that the erstwhile P.A.D.B. employee shall be entitled to count his previous service for the purposes of increment, leave, provident fund and gratuity. In the absence of a statutory provision specifically excluding the service rendered for any period by an employee, the presumption always is that what is not specifically excluded goes into the reckoning of seniority. Whatever doubts at the first blush one may get with regard to the consequences of absorption on a reading of the first proviso, the deeming provision introduced in the second proviso makes the position clear. Deemed service must necessarily encompass seniority in the equated cadre. The first proviso lays down that in consequence of the absorption, the conditions of service of the absorbed employees shall not be less favourable than those applicable to them before their absorption in respect of pay and allowances, leave, gratuity, provident fund and age of superannuation. The aforesaid protected conditions of service are in addition to the seniority which is covered by the deeming provision in the second proviso. What all the second proviso, lays down namely, the erstwhile P.A.D.B. employees "shall be entitled to count that service for purposes of increment, leave or provident fund and gratuity" are only illustrative of the facets of the protected service, but not exhaustive of what is intended to be protected. In consequence of absorption into the D.C.C.B., the erstwhile P.A.D.B. employees would not become fresh recruits. Once they were absorbed, the absorption should be in all respects except those that are specifically excluded. On a true construction, we are of the view that the entire service should be reckoned for the purpose of seniority was the basic underlying assumption of Clause (d) which needed no specific articulation. If Clause (d) of Section 11(2) was to be interpreted in the manner suggested by the counsel for the petitioners, viz., that seniority was not a component of the service protected, it would be violative of Articles 14 and 16 of the Constitution.
37. Clause IV of Rule 73, which deals with future promotions, says that the future vacancies in the post of Managers in the D.C.C.Bs. should be filled by promotion from the common pool of Assistant Managers, Executive Officers or Accounts of the erstwhile P.A.D.Bs., and Accountants of the D.C.C.Bs., Clause (VI) incorporates the principle governing inter se seniority which is to the effect that in the equated cadres, Inter-se seniority of the erstwhile P.A.D.B. employees should be determined on the basis of the dates of their appointment in the cadres in which they were working on regular basis including notional promotions.
38. The grievance of the petitioners in W.P. No. 14512 of 1994 and 14287 of 1994, who are Supervisors and Accountants, is that before they moved into the equated cadres, in the cadres immediately below the equated ones, they had put in longer years of service and, therefore, their entire service, both in the equated cadre as well as the cadre immediately below that, should be reckoned for the purpose of seniority to the next higher post. On the face of it, this is an untenable plea. When two posts are equated, the basis for future promotion must be the service rendered in the equated cadre but not in the cadres below the equated one. In respect of each separate cadre, reckoning of seniority could only be in that cadre: For example, if an employee had rendered 24 years of service in three cadres and was promoted to the next fourth cadre in the 25th year of his service, it would not be open to him to claim that because he could not earn promotion earlier due to the stringent statutory hurdles, in the promoted cadre, his entire seniority of 25 years should be counted. Such a claim to say the least, is highly' fanciful.
39. As the equated cadres came into being on 1-4-1987, reckoning of the inter se seniority in the equated cadres of the two classes of employees "on the basis of the dates of their appointment in the cadres in which they were working on regular basis including notional promotions, if any, on 1-4-1987" as recommended by the Commission and approved by the State Government, in the circumstances, was fully justified.
40. Yet another argument, a seemingly formidable one, urged for the petitioners is that the power of the Registrar of Co-operative Societies under Clause (d) was restricted to transferring the officers and employees of the erstwhile P.A.D.B. "to the service of the financing bank or to a P.A.C.S. in the manner prescribed" and as the D.C.C.B. is not the financing bank of the P.A.D.B., about which there is no dispute, the entire scheme of absorption must be set aside. We felt almost inclined at the first blush to agree with this contention, but on deeper considerations, we are unable to do so.
41. It is true that D.C.C.Bs., are not the financing banks of P.A.D.Bs. The Andhra Pradesh Central Co-operative Agricultural Development Bank, a statutory body, is the financing bank of P.A.D.Bs., and this is uncontroversial. P.A.C.S., have no financial capacity; they are small societies functioning at the village level and there are no equavalent posts against which the erstwhile P.A.D.B., employees could be absorbed. In the main part of Clause (d) of Section 11(2), instead of using the words "to the service of the District Co-operative Central Bank", inadvertently, in our view, the words "financing bank" were used. As Clauses (a) (b) and (c) specifically refer to the Co-operative Central Bank as the body to succeed the statutorily abolished P.A.D.Bs., in all respects - rights and assets, contracts, membership - and as respects service conditions, provisos (1) and (2) of Clause (d) also mention only the Co-operative Central Bank but not the financing bank, it is a clear case of draftsman's fallibility. If the transfer of the officers and employees of the erstwhile P.A.D.B. is to be construed as transfer to the "financing bank" but not the "DCCB", it would lead to absurd consequences. It was not the intention of the legislature to effect such transfer. Neither the context nor the other provisions of Section 11 envisage such an incongruity. In a situation where the ordinary meaning of grammatical construction of a statute leads to absurdity, at variance with the manifest purpose of the enactment, it should be construed in a manner consistent with the intention of the legislature or the enactment. The well established rule as slated in Maxwell's Interpretation of Statutes and followed by our Supreme Court in Tirath Singh v. Bachittar Singh, , while interpreting Section 99 of the Representation of the People Act reads:
"Where the language of a statute, in its ordinary meaning and grammatical construction, leads to a manifest contradiction of the apparent purpose of the enactment or to some inconvenience or absurdity, hardship or injustice, presumably not intended, a construction may be put upon it which modifies the meaning of the words and even the structure of the sentence".
We, therefore, hold that the words "financing bank" occurring in Clause (d) must be read as "Co-operative Central Bank".
42. Yet another submission advanced for the petitioners relates to Section 15-A of the Act which confers power on the Registrar of Co-operative Societies to amalgamate or merge on society with another society or to divide and restrict or transfer the area of operation of a society or to liquidate a society for any of the purposes specified therein. Clause (e) of Sub-section (1) says that in public interest, the Registrar may exercise the aforesaid power. It is the case of the petitioners that conditions of service of the employees of the affected societies are matters exclusively falling within the domain of Section 15-A(1)(e) and inasmuch as Section 15-A is a complete code in itself, Section 11(2)(d) is inapplicable. We do not find any merit in this contention. Four specified purposes are mentioned in Clauses (a) to (d) of Section 15-A(1) - economic viability, avoidance of over-lapping or conflict of jurisdictions, securing proper management, interests of co-operative movement and co-operative credit structure. The fifth purpose contained in Section 15-A(1)(e) for which amalgamation, division or restriction of the area of operation could be done by the Registrar was "for any other reason in the public interest". It is true that when a particular society is amalgamated with another society or its area of operation is restricted or it is liquidated, the Registrar will have to devise a method to safeguard the interests of the employees of the affected society. This power is basically different from what is contemplated by Section 11(2) which is a direct consequence of abolition of an entire class of societies viz., P.A.D.Bs., Section 11 specifically deals with abolition of P.A.D.Bs. and the consequences of such abolition. It also takes care to protect the service conditions of the employees of the abolished banks. It is, therefore, plain that Section 15-A has no application.
43. Our examination of the entire scheme of equation of posts, integration of services and determination of inter se seniority in consequence of Section 11 (2)(d) leads to the conclusion that the D.C.C.B. employees secured more advantage than the employees of the erstwhile P.A.D.Bs. Instead of five categories which were in existence before 1-4-1987, there are only three categories now in the D.C.C.Bs. and with the creation of 107 posts of Assistant General Managers, the promotional avenues of D.C.C.B., employees were improved to a great extent. A satisfactory solution at long last was found by the Government in the form of Rule 73, the basis of which was the agreement arrived at by the two service unions representing the erstwhile P.A.D.B. and the D.C.C.B. employees. When the solution was to the satisfaction of the overwhelming number of employees of both the classes, the perceived dissatisfaction of a few in a situation like the present one cannot be a consideration, even if their discontentment has some semblance of legal validity which will be of no consequence, to set at naught the entire exercise. In our considered opinion, there is no legal or factual foundation supporting the case of the petitioners.
44. For these reasons, all the writ petitions fail and accordingly they are dismissed. However, we make it clear mat the right of any aggrieved employee to prefer an appeal to the Managing Committee of the District Co-operative Central Bank against an order passed by the General Manager under Rule 73(IX) remains unaffected notwithstanding the dismissal of these writ petitions. No costs.