Punjab-Haryana High Court
The Sonepat Vegetable Growers ... vs Presiding Officer on 19 August, 2013
Author: Paramjeet Singh
Bench: Paramjeet Singh
CWP No.8809 of 1991 1
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
CWP No.8809 of 1991
Reserved on:15.07.2013
Date of Decision: 19.08.2013
The Sonepat Vegetable Growers Cooperative Marketing Society
Limited, Sonepat.
...Petitioner
Versus
Presiding Officer, Industrial Tribunal-cum-Labour Court, Rohtak and
another
...Respondents
CORAM: HON'BLE MR. JUSTICE PARAMJEET SINGH
1) Whether reporters of the local papers may be allowed to
see the judgment?
2) To be referred to the Reporters or not?
3) Whether the judgment should be reported in the Digest?
Present: Mr. R.S.Sihota, Senior Advocate with
Mr. B.R.Rana, Advocate,
for the petitioner.
Ms. Kiran Rathee, Advocate,
for respondent no.2.
****
PARAMJEET SINGH, J.
Instant writ petition has been filed under Articles 226/227 of the Constitution of India for issuance of writ in the nature of certiorari/mandamus for quashing the Award dated 05.04.1991 Kumar Parveen 2013.08.23 15:52 I attest to the accuracy and integrity of this document High Court, Chandigarh CWP No.8809 of 1991 2 (Annexure P/5) passed by the Presiding Officer, Industrial Tribunal- cum-Labour Court, Rohtak.
Shorn of unnecessary details, the facts relevant for disposal of the present petition are to the effect that petitioner is a cooperative society registered under the Haryana Cooperative Societies Act, 1984. The petitioner-society has been constituted to provide a platform to the farmers for selling their vegetable products without payment of any commission to the middleman. The Society was established in April, 1984 and at that time, it had only two employees i.e. Mr. Baljit Singh, its Manager and Mr. Pardeep Kumar, Peon-cum-Chowkidar. The strength of its employees was increased to three with the appointment of respondent no.2 as Peon-cum-Chowkidar and after termination of services of respondent also, the total strength of its employees remained three. For conducting the business of the Society, it has framed Bye- laws and under Bye-law No.4, its objects have been defined.
It is the case of the petitioner that keeping in view the number of employees of the Society, it does not fall within the definition of "industry" as defined under Section 2 (j) of the Industrial Disputes Act, 1947 (in short 'the Act'), more particularly in view of explanation (9) added to Section 2 (j) of the Act. It is further averred that on account of resignation of its Peon-cum-Chowkidar, the Managing Committee of the Society resolved to appoint respondent no.2 as Peon-cum-Chowkidar on ad hoc basis on a monthly salary of ` 450/- w.e.f 1.4.1984. The decision of the Managing Committee whereby respondent no.2 was Kumar Parveen 2013.08.23 15:52 I attest to the accuracy and integrity of this document High Court, Chandigarh CWP No.8809 of 1991 3 appointed reads as under:
" It is unanimously resolved that Shri Ram Phal Singh son of Shri Tek Chand of VPO Saithal (Sonepat) be appointed as Peon-cum-Chowkidar on ad hoc basis on a monthly salary of ` 450/- w.e.f 1.4.1984 as the previous Peon-cum-Chowkidar has resigned from service."
It is further averred that conditions of service and other business affairs of the Society are strictly governed as per its Bye-laws. Bye-law No.57 of the Bye-laws of the Society reads as under:
"57. (a) No person shall be employed by the Society unless he satisfies the qualifications that may be laid down by the Registrar from time to time.
(b) No person shall be employed by the Society without obtaining from him security in such form and according to such standards as may be laid down by the Registrar from time to time."
In spite of number of notices and directions given by the Society, respondent no.2 did not comply with Bye-law No.57. In the notice dated 08.04.1987, it was mentioned that in case respondent no.2 did not furnish the security, the services of respondent no.2 would stand terminated w.e.f 09.04.1987 in view of the decision taken by the Managing Committee. The requirement of furnishing of security by respondent no.2 became further necessary in the interest of the Society, because it was found that while taking payments on behalf of the Society Kumar Parveen 2013.08.23 15:52 I attest to the accuracy and integrity of this document High Court, Chandigarh CWP No.8809 of 1991 4 from various vegetable shop-keepers, respondent no.2 had misappropriated an amount of ` 1466.90/- and the aforesaid amount was not deposited in the accounts of the Society. Respondent no.2 was served with a show-cause notice dated 01.10.1986 (Annexure P/3). Vide his reply dated 04.11.1986, respondent no.2 admitted that he had not deposited an amount of ` 1411/- in the accounts of the Society and he was liable to pay the same. It is further averred that in view of the conceded embezzlement and the fact that respondent no.2 was not furnishing security in compliance of Bye-law No.57 of the Bye-laws of the Society, the Society terminated the services of respondent no.2 w.e.f 09.04.1987. Feeling aggrieved by the termination of his services, respondent no.2 filed an Appeal dated 20.06.1987 before the Assistant Registrar Cooperative Societies, Sonepat, but the same was rejected. Thereafter, respondent no.2 served a demand notice dated 07.07.1987 alleging that he had been retrenched from employment without complying with provisions of Section 25 F of the Act, therefore, he might be reinstated into service. In pursuance to the aforesaid demand notice, the Government of Haryana referred the disputed for adjudication before respondent no.1. It is further averred that respondent no.1 without appreciating point involved in the instant case and without taking into consideration the fact that the proceedings under the Act are not maintainable against the Society, has answered the reference in favour of respondent no.2 vide impugned Award dated 05.04.1991. Hence, the instant writ petition.
Kumar Parveen 2013.08.23 15:52 I attest to the accuracy and integrity of this document High Court, Chandigarh CWP No.8809 of 1991 5
In pursuance to the notice of motion, respondent no.2 filed reply and denied the averments made in the petition. He admitted that compliance of the Bye-law No.57 was required, however, denied other facts and submitted that he had a security of immovable property, but the same was not accepted. It is further averred that there is no condition in the appointment letter with regard to compliance of Bye-law No.57. He alleged that the condition of deposit of ` 5,000/- as cash security is arbitrary and mala fide. Besides this, the other averments have also been denied.
I have heard learned counsel for the parties and perused the record.
Learned counsel for the petitioner has vehemently contended that appointment to service is an agreement between an employee and the employer where the employee agrees to serve the employer on the conditions mentioned in the appointment letter as well the rules and bye- laws of the concerned organization. The employee is bound by the terms and conditions of employment as well as bye-laws governing the conditions of services of an employee. The learned counsel for the petitioner has further contended that as per the Bye-law No.57, respondent no.2 was bound to submit cash security as he was conveyed vide various notices placed on record as Annexures P-1 to P-3 specifically Annexure P-3 whereby respondent no.2 was offered to submit the cash security as per the Bye-law No.57, but in spite of that, respondent no.2 did not submit the security amount. This was the clear Kumar Parveen 2013.08.23 15:52 I attest to the accuracy and integrity of this document High Court, Chandigarh CWP No.8809 of 1991 6 violation of the terms of agreement. In the present case, the security bond was required in pursuance to the bye-laws which creates an obligation on the employee to deposit money. It is the legal condition whereby a person undertakes to do or not to do anything subject to condition stipulated therein. The necessity of executing security bond arises in view of the objects of the Society and its dealing with the farmers and their money. The learned counsel has further contended that this is the specific case of the petitioner that earlier respondent no.2 had collected money of ` 1411/- and embezzled it. In such an eventuality, security was a necessity and was also required to be given in pursuance to the bye-laws. The services of respondent no.2 have been terminated for non-compliance of the Bye-law No.57 of Bye-laws of the society. Even the appeal preferred before the Assistant Registrar Cooperative Societies, Sonepat was rejected. Once the services of respondent no.2 have been terminated and he has availed the remedy under the rules, he cannot get any relief under the Act. The learned counsel has further contended that in view of explanation 9 of Section 2 (j) of the Act, the petitioner-Society does not fall within the definition of "industry".
Per contra, learned counsel for respondent no.2 has vehemently opposed the contentions raised by the learned counsel for the petitioner and vehemently contended that the condition of security bond is an arbitrary and impermissible. Respondent no.2 offered security of immovable property which was not accepted. Besides this, the impugned Award cannot be set aside by this Court in exercise of Kumar Parveen 2013.08.23 15:52 I attest to the accuracy and integrity of this document High Court, Chandigarh CWP No.8809 of 1991 7 extraordinary jurisdiction. The learned counsel has further contended that the impugned Award is legal, valid and well-reasoned, so the same is not liable to be set aside.
I have considered the rival contentions of learned counsel for the parties and perused the record.
First of all, I would like to deal with the point whether the petitioner-Society falls within the definition of "industry" in view of Explanation 9 of Section 2 (j) of the Act. Before I deal with the contentions raised by the learned counsel for the parties, it would be appropriate to re-produce Section 2 (j) of the Act to which reference has been made by learned counsel for the petitioner which reads as under:
"2 (j) 'industry' means any systematic activity carried on by cooperation between an employer and his workmen (whether such workmen are employed by such employer directly or by or through any agency, including a contractor) for the production, supply or distribution of goods or services with a view to satisfy human wants or wishes (not being wants or wishes which are merely spiritual or religious in nature), whether or not-
(i)any capital has been vested in for the purpose of carrying on such activity or
(ii)such activity is carried on with a motive to make any gain or profit and includes -
(a) any activity of the Dock Labour Board established under Section 5-A of the Dock Workers (Regulations Kumar Parveen 2013.08.23 15:52 I attest to the accuracy and integrity of this document High Court, Chandigarh CWP No.8809 of 1991 8 of Employment) Act, 1948 (9 of 1948);
(b) any activity relating to the promotion of sales or business or both carried on by an establishment, but does not include -
(i) any agricultural operation except where such agricultural operation is carried on in an integrated manner with any other activity (being any such activity as is referred to in the foregoing provisions of this clause) and such other activity is the predominant one.
Explanation - For the purposes of this sub-clause, "agricultural operation" does not include any activity carried on in a plantation as defined in Clause (f) of Section 2 of the Plantations Labour Act, 1951 (69 to 1951); or (2) to (8) - not relevant (9) any activity, being an activity carried on by a cooperative society or a club or any other like body of individuals, if the number of persons employed by the cooperative society, club or other like individuals in relation to such activity is less than ten."
From the reading and objects of Society, it is clear that it is a cooperative society. The strength of employees working in the Society was three at relevant time. The aims and objects of the Society have been provided under Bye-law No.4 which read as under:
"4. The object of the Society shall be :-
Kumar Parveen 2013.08.23 15:52 I attest to the accuracy and integrity of this document High Court, Chandigarh CWP No.8809 of 1991 9
(i)To open collections/grading centres and to provide cheap transport facilities primarily to its members, the carriage of their produce either to the society or any another market;
(ii)To undertake outright purchases in case of need;
(iii)To collect market intelligence from the various mandies supply the same to its members;
(iv)To make arrangements for the storage and marketing of produce of the society or its members;
(v)to supply seed, manure, agriculture implements and to meet other requirements of the members;
(vi)to arrange the processing of vegetable primarily of its members and purchase in hiring suitable machinery for this purpose;
(vii)to hire or own godown and cold storages for the storrage of produce;
(viii)to act as agent of the government;
(ix)to make the arrangement for raising funds required for its own business for lending to its members;
(x)to disseminate among its members knowledge of Cooperative principles and practices;
(xi)to undertake measures to spread knowledge of cooperative principles and practices;
(xii)to undertake such other activities as are conductive to the attainment of above objects."
Kumar Parveen 2013.08.23 15:52 I attest to the accuracy and integrity of this document High Court, Chandigarh CWP No.8809 of 1991 10
The Society has been constituted to provide a platform to the farmers for selling their vegetables without payment of any commission to the middlemen. This is the only Society of its nature in the State of Haryana. From the reading of provisions reproduced hereinabove, it is clear that the Society is a cooperative society and number of persons employed in it is less than 10. This amended definition cannot be taken into consideration as it has not come into operation for want of notification.
So far as the arguments with regard to non-compliance of condition of security by respondent no.2 is concerned, as per Bye-law No.57 of the Bye-laws of the Society, the services of an employee are governed by the provisions which the employer-Society has framed. In view of Bye-laws of the Society, an employee is required to furnish security bond as demanded by the petitioner-Society which respondent no.2 failed to do in spite of sufficient long time and notices (Annexure P- 1 to P-3) issued to him. Such a requirement is legal and valid one as in case of breach of stipulation of employment or any loss caused to the Society, the Society could reasonably be compensated as per the terms of the security bond. The security bond stipulates a certain sum of money to be paid in case of loss caused to the Society. It clearly indicates that the condition is valid one and is not an arbitrary condition. The Bye-law No.57 of the Bye-laws of the Society provides that in case of any loss caused to the Society by an employee, the same may be recovered from the security amount as the business of the Society involves financial transaction. Just to safeguard the interest of the Society, such conditions Kumar Parveen 2013.08.23 15:52 I attest to the accuracy and integrity of this document High Court, Chandigarh CWP No.8809 of 1991 11 are necessary. Failure to comply with the terms of employment read with rules/regulations/Bye-laws governing the conditions of service of the employee, in spite of repeated notices and sufficient time, certainly means violation of terms of the employment and the petitioner-Society is entitled to dispense with service of such an employee who is not ready to comply with the conditions as specified by the bye-laws of the Society. There is allegation against respondent no.2 that he had collected the amount but did not deposit the same. In such circumstances, compliance of Bye-law No.57 of Bye-laws of the Society was necessary.
In view of above, the instant writ petition is allowed and the impugned Award dated 05.04.1991 (Annexure P-5) is set aside.
No order as to costs.
(Paramjeet Singh) Judge August 19, 2013 parveen kumar Kumar Parveen 2013.08.23 15:52 I attest to the accuracy and integrity of this document High Court, Chandigarh