Andhra HC (Pre-Telangana)
Andhra Pradesh State Co-Operative ... vs State Of Andhra Pradesh And Ors. on 19 October, 2001
Equivalent citations: 2002(1)ALD271, 2002(4)ALT272
Author: S.B. Sinha
Bench: S.B. Sinha
JUDGMENT S.B. Sinha, CJ.
1. This writ appeal is directed against an order dated 1-2-2001 in Writ Petition No. 5431 of 1990 whereby and whereunder the learned single Judge disposed of the writ petition in terms of the order dated 10-10-1991 in Writ Petition No. 15506 of 1989.
2. Writ Petition No. 5431 of 1990 has been filed by the appellant herein seeking a declaration that Section 116-AA of the Andhra Pradesh Co-operative Societies Act, 1964 (for short 'the Act') is arbitrary, illegal and unconstitutional and violative of Article 14, 21, 39, 41, 42 and 43 of the Constitution of India.
FACTS:
3. It is stated that the Paid Secretaries were appointed on full time basis to manage the affairs and maintain the accounts of Primary Agricultural Co-operative Societies. The Registrar of Co-operative Societies in exercise of powers under Section 116-A of the Act in 1973 has constituted a common cadre to the Secretaries of the Societies with a view to provide qualified Secretaries and they were trained to discharge the functions of Chief Executives of PACS. Originally, they were paid a consolidated sum of Rs.150/- towards their remuneration.
4. The Andhra Pradesh Agricultural Credit Societies Paid Secretaries (Common Cadre) Regulations were framed under Section 116-A of the Andhra Pradesh Cooperative Societies Act, 1964 and by proceedings dated 1-1-1980 all the Paid Secretaries of the PACS were placed in the time scale of Rs. 250-420 with a fixed Dearness Allowance, which was equivalent to Supervisors of Cadre V of the District Co-operative Central Banks. The Government of Andhra Pradesh promulgated the A.P. Co-operative Societies (2nd and 3rd Amendments) Ordinance, 1985 amending Section 116-AA of the Cooperative Societies Act decaderising the Paid Secretaries. The grievance of the appellant is that when the Paid Secretaries were being allotted to the Societies, the Presidents of the Societies are refusing to admit them on the ground that there is no obligation on their part to admit the Secretaries who are allotted under Section 116-AA of the Act.
SUBMISSIONS:
5. Mr. N. Krishna Rao, learned Counsel appearing on behalf of the appellant would contend that the State did not follow the procedure laid down under Section 25(N) of the Industrial Disputes Act while introducing Section 116-AA of the Act as the decaderisation of Paid Secretaries is nothing but an act of retrenchment and it amounts to depriving the right to life under Articles 21 and 20(2) of the Constitution of India. He would further contend that Section 116-AA of the Act is not only contrary to Article 300A of the Constitution of India but also against the decision of the Apex Court in S.P. Dubey v. Madhya Pradesh State Road Transport Corporation, (1991) Supp. 1 SCC 426. The learned Counsel would submit that the Government on the one hand had fixed the pay scales of Paid Secretaries of the Societies and later withdrew the same through G.O. Ms. No. 314, dated 26-12-2000. He would also contend that the issue relating to validity of Section 116-AA of the Act has been kept open by the Division Bench in WP No. 17735 of 1989 and the learned single Judge ought to have considered the validity of the same independently. The Co-operative Societies do come under the purview of the Industrial Disputes Act, contends the learned Counsel, and as such it is mandatory on the part of the Sate to follow the procedure laid down under Section 25(n) of the Industrial Disputes Act while retrenching the employees of the Societies.
6. The learned Additional Advocate-General appearing on behalf of the State, would contend that the posts of Paid Secretaries have been decadarised under the provisions of Section 116-AA of the Act and the interest of the Paid Secretaries has been safeguarded as the Registrar of the Societies is empowered to allot them to the Societies as he may deem fit. As a matter of fact, the learned Additional Advocate-General, would submit, that no paid Secretaries have been retrenched.
RELEVANT PROVISIONS
7. Section 116-AA of the Act provides for abolition of centralised services for certain categories of employees, which reads:
"The common cadre for all categories of employees other than those specified in Section 116-A, constituted before the commencement of the Andhra Pradesh Cooperative Societies (Amendment) Act, 1985 and existing at such commencement shall stand abolished with effect on and from the commencement, and upon such abolition, it shall be lawful for the Registrar, to allot, subject to such rules as may be made in this behalf, the employees included in the cadre so abolished to such Primary Agricultural Credit Societies as he may deem fit:
Provided that until they are allotted as aforesaid they shall continue in the posts in which they are working at the commencement of the said Act."
8. Section 116-C of the Act, which deals with the staffing pattern of the societies, reads thus:
"(1) A society shall have power to fix the staffing pattern, qualification, pay scales and other allowances for its employees with the prior approval of the Registrar of Co-operative Societies;
(2) No appointment or removal of a Chief Executive by whatever name called of any society, or class of societies as may be prescribed which are in receipt of financial aid from the Government, shall be made without the prior approval of the Registrar of Co-operative Societies."
9. The amendment thereto brought in by Act 22 of 2001 to Section 116-C reads thus:
In Section 116-C of the Principal Act, for Sub-section (1), the following sub-section shall be substituted, namely:-
(1) A society shall have power to fix the staffing pattern, qualifications, pay scales and other allowances of its employees with the prior approval of the Registrar of Co-operative Societies subject to the condition that expenditure towards pay and allowances of the employees shall not exceed two per cent of the working capital or thirty per cent of the gross profit, in terms of actuals in a year whichever is less.
10. The structure of the Paid Secretaries has come into existence in pursuance of G.O. Ms. No. 390, 12-7-1973 whereby and whereunder a scheme for appointment of Paid Secretaries in Co-operative Agricultural Credit Societies was contemplated providing for appointment of Paid Secretary for each society on a consolidated pay of Rs. 150/-per month and the Registrar of Co-operative Societies was requested to take immediate steps to implement the said scheme during 1973-74. In 1964 the Andhra Pradesh Agricultural Credit Societies Paid Secretaries (Common Cadre) Regulations were framed under Section 116 (A)(1) of the Act. Regulation 2(iii) thereof defines "Paid Secretary" to mean any person appointed by the specified authority of the Appointment Committee to work as Secretary, Manager or by any other designation, carrying out the functions of Chief Executive in any of the societies specified.
11. The Government is empowered to give directions to the Registrar of Cooperative Societies under Section 131 of the Act, which is in the following terms:
"(1) The Government may generally or in any particular matter under this Act, issue such orders and directions as they may consider necessary to the Registrar of Co-operative Societies and thereupon he shall give effect to such orders or directions and shall report to the Government in due course the result thereof.
(2) In any case, in which a direction has been given under Sub-section (1), the Government may call for and examine the record of the proceedings of the Registrar and pass such orders in the case as they may think fit:
Provided that before passing any order under this sub-section, the person likely to be affected by such order shall be given an opportunity of making his representation."
12. Rule 72 of the Andhra Pradesh Co-operative Societies Rules, 1964 provides for guidelines in regard to allotment of decadarised Secretaries to the Societies. Sub-rule (3) of Rule 72, which is relevant, reads thus:
"(a) The Secretary, on allotment to a Society, shall be deemed to be the employee of that society and shall be entitled to receive pay and allowances as may be fixed from the funds of the said society.
(b) The service condition of the Secretaries working in the societies shall be governed by such service regulations as may be framed by the Registrar for adoption by the Societies."
13. The provisions of Section 116-C have been amended by Act 22 of 2001 -A.P. Co-operative Societies (Second Amendment) Act, 2001. Section 116-AA was enacted as far back as in the year 1985, by reason of the said provision, the services of Paid Secretaries had statutorily been decadarised and their services were placed at the disposal of the respective Co-operative Societies. After enactment of the aforementioned provision, they did not have any statutory right as regards their status. So far as co-operative societies are concerned, they are not financed by the State. Some amount of control is exercised by the State, but the employees of the Co-operative Societies are not the employees of the State. The learned Counsel appearing on behalf of the petitioners has not questioned the legislative competence of the State. It is also not the contention of the learned Counsel that the Co-operative Society on its own could not have fixed the conditions of the service of the Paid Secretaries of its employees. It is also undisputed that the Co-operative Societies being corporate bodies are entitled to prescribe qualifications in relation to the posts and determination of pay scales and other allowances which may be subjected to the approval of the Registrar.
14. In B. Veeraswamy v. Large Sized Co-operative Society, 1995 (1) An. WR 237, the question as regards the validity of Section 116-AA came up for consideration, wherein it was held:
...... The petitioner is allotted to Gavaravaram Primary Agricultural Cooperative Society in pursuance of Section 116-AA of the A.P. Co-operative Societies Act, 1964 (Act 7 of 1964) and Rule 72 of the Rules framed under the Act. Therefore, respondent No. 1 of whom the petitioner was employed at the relevant time was entitled to pass the impugned suspension order. Thus, the legality of the impugned order or the jurisdiction to pass the order by respondent No. 1 cannot be challenged on such a ground.
15. In terms of the provisions of the statute, the Co-operative Societies except in certain cases would not be a "State" within the meaning of the Article 12 of the Constitution of India.
16. The financial burden of payment of remuneration of the employees has to be borne by the respective Co-operative Societies. The Co-operative Societies are constituted for promoting thrift movement. It is also supposed to earn profit for its members. The expenditure to be incurred on the staff has direct nexus with the profit earned by the Co-operative Societies or the working capital.
Reference to the preamble of the Constitution or Section 25 of the Industrial Disputes Act by the learned Counsel for the parties is in our opinion wholly irrelevant.
17. The submission of the learned Counsel to the effect that if Paid Secretaries are to be allotted to Co-operative Societies, the same would amount to retrenchment, cannot be accepted for more than one reason. Firstly, the decentralisation of cadre has already been taken place by the statutory provision which has come into force in 1985. In that view of the matter, it is too late in the day of contend that by reason of the said provision, the effect of the said provisions would amount to retrenchment.
18. Furthermore, the said question docs not appear to have been raised. Hardship by itself as is well known cannot by itself be a ground for declaration of the statutory provisions ultra vires.
19. A recent decision of the Supreme Court at this stage may be noticed. Consequent upon the directions given by the Supreme Court in A.S. Narayana Deekshitulu v. State of A.P., , a scheme for the welfare of Archakas and servants of the temples was formulated. The scheme postulated that temples with an annual income of less than Rs. 5 lakhs should be left to fend for themselves. In lieu of salary, the properties given to them may be retained by the Archakas for enjoyment subject to rendering service depending upon the income of the respective temples as per the prevailing circumstances. In cases of temples with considerably low income, the scheme provided for gradual reduction of the staff, both secular and religious, so as to ensure that the expenditure on the establishment should be limited to 30% as provided under Section 57 of the Act.
20. The contention of Archakas to the effect that the provision for grouping was not correct and that they could not be treated as Government servants since the Supreme Court had already found that the rendering of the service by Archakas, was an integral part of religious services, was rejected in Divi Kodadandarama Saram v. State of A.P., by the Apex. Court. In the said, case, it was held:
Therefore, they cannot be tagged with the status of Government servant. There appears to be a misconception on the part of the Counsel for the Archakas. It is already held that the Archakas owe their appointment to the institution, though, earlier, it was hereditary. On abolition of hereditary rights, he remains to be an employee like other secular staff of the temple. As a result, his rendering duties of performing rituals, ceremonies as an Archaka is different from his status as an Archaka. Therefore, though he is not treated like a Government servant, he is now treated on a par with the secular staff of the temple. As suggested, in case of fall in the income necessarily the retrenchment is required to be resorted to even in respect of the religious staff. Accordingly, we direct the Government with the consultation of the Commissioner of Endowment Department to carefully look into the matter and evaluate from time to time and take appropriate decision as regards the increase or reduction in the cadre strength of the religious staff.
21. The conditions of service of different persons working under different Co-operative Societies may vary. Each Cooperative Society is entitled to lay down its own service conditions. The only statutory requirement is that same must be approved by the Registrar of Co-operative Societies in terms of Rule 72 of the A.P. Co-operative Societies Rules. Only because, there is a possibility of different Co-operative Societies fixing different remunerations for their Paid Secretaries in terms of Section 116-AA, it would not attract Article 14 of the Constitution. Each Co-operative Society must fix its staffing pattern and also fix the remuneration payable to employees in such a manner so that the provisions of Article 116-C are not violated. The employees of each Co-operative Society would form a different class and in that view of the matter in our opinion, even no discrimination can be alleged, nor Article 14 of the Constitution would be violated thereby.
22. Reliance on the decision of the Apex Court in S.P. Dubey v. Madhya Pradesh State Road Transport Corporation, (1991) 1 SCC 426, by the learned Counsel for the appellant is not apposite. The question that arose for consideration therein was as regards the discrepancy in the age of retirement whereas those services of the petitioners had been taken over by a notification wherein it was expecifically stated that the existing staff of the company would not be adversely affected with regard to the service conditions.
23. Having regard to the fact that specific assertion had been made that their conditions of service would not be adversely affected, the Apex Court held that the rules which were applicable to the State employees would not be applicable to them. The said decision has therefore no application in the present case.
24. The matter relating to the conditions of service has been dealt with by this Bench in WA No. 424 of 2001 and batch disposed of on 16-10-2001.
25. We may not therefore discuss in detail the other contentions raised in the application.
26. We therefore, are of the opinion that no case has been made out for holding that the provisions of Sections 116-AA and 116-C of the Act are unconstitutional.
For the reasons aforementioned, we do not find any merit in this application. The writ petition is dismissed. No costs.