Madras High Court
The Management vs The Appellate Authority Under The Tamil ... on 2 September, 2025
Author: P.T. Asha
Bench: P.T. Asha
W.P.No. 2821 of 2023
IN THE HIGH COURT OF JUDICATURE AT MADRAS
RESERVED ON : 29.07.2025
PRONOUNCED ON : 02.09.2025
THE HONOURABLE Ms. JUSTICE P.T. ASHA
W.P.No. 2821 of 2023
&
W.M.P.No. 2945 of 2023
The Management,
E.2594 Vadakailasam Primary Agricultural
Cooperative Credit Society Ltd.,
Rep by its President,
Vadakailasam,
Panruti Post,
Cuddalore District – 607 106. … Petitioner
Vs.
1.The Appellate Authority under the Tamil Nadu
Payment of Subsistence Allowance Act /
Joint Commissioner of Labour – II,
Chennai – 6.
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W.P.No. 2821 of 2023
2.The Deputy Commissioner of Labour (Additional Charge)
O/o, Joint Commissioner of Labour – II,
Chennai – 6.
3.K.Mathialagan ... Respondents
Prayer: Writ Petition is filed under Article 226 of the Constitution of
India Writ of Certiorari, to call for the records of the order passed by
the 1st respondent in PSAA No.1 of 2021 dated 26.09.2022 and
reversing the order of the 2nd respondent in PSA.No.16 of 2017 dated
04.01.2021 quash the same.
For Petitioner : Mr. M.S.Palaniswamy
For Respondents : Mr. M.Murali
1&2 Government Advocate
For Respondent : Mr. F.W.H.Pithasan
3 For Mr. K.Arunagiri.
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W.P.No. 2821 of 2023
ORDER
The above Writ Petition is filed for the following relief:
“to call for the records of the order passed by the 1st respondent in PSAA No.1 of 2021 dated 26.09.2022 and reversing the order of the 2nd respondent in PSA.No. 16 of 2017 dated 04.01.2021 quash the same”.
2. The brief resume of the facts as set out in the affidavit filed in support of the writ petition are herein below set out:
3. The 3rd respondent was working as a Secretary of the petitioner Society since 24.08.2001. It came to the light that during his tenure several irregularities had been committed and therefore the Joint Registrar of Cooperative Societies, Cuddalore taking cognisance of the same suspended him from service on 12.08.2004. On 24.09.2004, a charge memo was issued to the 3rd respondent and an Enquiry Officer 3/20 https://www.mhc.tn.gov.in/judis ( Uploaded on: 02/09/2025 04:22:39 pm ) W.P.No. 2821 of 2023 was appointed. The Enquiry Officer submitted his report on 25.01.2008 holding that the charges were proved against the 3rd respondent. On the basis of the above report the 3rd respondent was dismissed from service on 11.01.2010. In keeping with the bye laws, the 3rd respondent was paid the entire subsistence allowance during the period of suspension.
4. Meanwhile, the Deputy Registrar had ordered enquiry under Section 81 of the Tamil Nadu Cooperative Societies Act, herein after called the Cooperative Societies Act. In addition, based on the Enquiry report dated 25.01.2018 Criminal proceedings were also initiated against the 3rd respondent. Simultaneously the Deputy Registrar had issued a surcharge notice under Section 87 of the Cooperative Societies Act and on 05.01.2009 surcharge orders was passed against the 3rd respondent and recovery proceedings are pending against him. 4/20 https://www.mhc.tn.gov.in/judis ( Uploaded on: 02/09/2025 04:22:39 pm ) W.P.No. 2821 of 2023
5. Whileso, after these proceedings were initiated, the 3rd respondent had approached the 2nd respondent by filing an application under Section 4 of the Tamil Nadu Payment of Subsistence Allowance Act, herein after called the Subsistence Allowance Act, in PSA No.16 of 2017 contending that a sum of Rs.3,82,072/- was due towards balance subsistence allowance.
6. The petitioner would contend that the very invocation of the provisions of the Subsistence Allowance Act was without jurisdiction in as much as the 3rd respondent was not an “employee” as defined under Section 2 (a) of the Subsistence Allowance Act, but was an officer as defined under Section 2 (19) of the Cooperative Societies Act. That apart, the 3rd respondent was working as a Secretary and a Common Cadre Employee under Section 75 (2) of the Cooperative Societies Act and would therefore not be amenable to the provisions of the Subsistence Allowance Act. The 2nd respondent by order dated 04.01.2021 rejected the claim of the 3rd respondent. 5/20 https://www.mhc.tn.gov.in/judis ( Uploaded on: 02/09/2025 04:22:39 pm ) W.P.No. 2821 of 2023
7. Challenging the same, the 3rd respondent had filed an appeal before the 1st respondent in PSAA.No.1 of 2021. However, the 1st respondent without considering the lack of jurisdiction proceeded to allow the appeal by his order dated 26.09.2022. Aggrieved by the same the petitioner has filed the above Writ Petition.
8. No counter has been filed by the respondents including the 3rd respondent and only arguments have been advanced. Submissions:
9. Mr. M.S.Palaniswamy, learned counsel appearing for the petitioner Society would contend that the respondents 1 and 2 had no jurisdiction to entertain the application as the 3rd respondent is not an “employee” as defined under Section 2 (a) of the Subsistence Allowance Act but was an “officer” as defined under Section 2 (19) of the Cooperative Societies Act. Therefore, he would contend that it is 6/20 https://www.mhc.tn.gov.in/judis ( Uploaded on: 02/09/2025 04:22:39 pm ) W.P.No. 2821 of 2023 the Cooperative Societies Act which would apply in the case of the 3 rd respondent. He would further submit that in the counter filed to PSA No.16 of 2017, the petitioner herein had taken the defense that as per the special bye-laws of the Society the Secretary is the Chief Executive Officer and can therefore not be called an employee. As per clause 2 I of the special Bye laws the Secretary is on par with the Executive Officer. He would submit that if the 3rd respondent is aggrieved by the fact that he has not been paid the actual amount of subsistence allowance his remedy is only under the Co-operative Societies Act and not under the Subsistence Allowance Act. He would rely upon the following Judgements:
(i)2007 (5) CTC 392 – M.Kanagasabapathy Vs. The Special Officer.
(ii)2011 SCC Online Mad 2495 – K.Avanasiappan Vs. The Management of Thekkalur Primary Agricultural Co-operative Bank, Coimbatore and others.
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(iii)CDJ 2017 MHC 1686 – The Management, Elavadi Primary Agricultural Co-operative Bank Vs. The Assistant Commissioner of Labour and another.
(iv)WP.No.17600 of 2020 – The Management K 797 Kongalnagaram Primary Agricultural Cooperative Credit Society Ltd., Vs. The Authority under the Tamil Nadu Payment of Subsistence Allowance Act / Assistant Commissioner (Labour), Coimbatore and another.
10. Per contra Mr. F.W.H.Pithasan appearing on behalf of Mr.K.Arunagiri, learned counsel for the 3rd respondent would submit that though the 3rd respondent was called a Secretary he was entitled to claim subsistence under the provisions of GO.Ms.No.55 Cooperation, Food and Consumer Protection Department dated 24.03.2000 whereunder the Government had decided to constitute the Tamil Nadu 8/20 https://www.mhc.tn.gov.in/judis ( Uploaded on: 02/09/2025 04:22:39 pm ) W.P.No. 2821 of 2023 Primary Agricultural Cooperative Banks Common Cadre Service for the post of Secretary of Primary Agricultural Cooperative Banks. In exercise of the powers conferred under Section 75 of the Cooperative Societies Act orders were issued for constitution of Common Cadre of Service in respect of the post of Secretary of the Primary Agricultural Cooperative Bank in the the State. Under Regulation 29 (d) a cadre employee under suspension was entitled to subsistence allowance as per the Subsistence Allowance Act. He would further submit that the suspension order dated 12.08.2004 has been issued under Regulation 29 (e) of the GO.Ms.No.55 stated supra. He would rely in the following Judgements:
(i)CDJ 2002 SC 476 – Anwarun Nisha Khatoon Versus State of Bihar and others.
(ii)CDJ 2008 MHC 5144 – Kuthiraichandal Primary Cooperative Bank Limited.
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(iii)WA 1569 of 2012 – The Special Officer, Krishnagiri District Vs. P.Periyannan and another.
(iv)WA(MD)No.355 of 2020 – G.Selvaraj Vs. The Deputy Registrar of Cooperative Societies, Palani Circle, Palani, Dindigul District.
(v)WP.No.24625 of 2014 – T.Kirubakaran Vs. Deputy Registrar, Cooperative Society and others.
(vi)WP.No.21238 of 2022 – The Management Modakkurichi Circle Teachers and Public Servants Cooperative Thrift and Credit Society Ltd., Vs. The Joint Commissioner of Labour Controlling Authority, Erode.
11. Heard the learned counsels on either side.
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12. The arguments advanced by the learned counsel for the petitioner is that the 3rd respondent is not an employee as defined under Section 2 (a) of the Subsistence Allowance Act and that since he is a Secretary of the Primary Agricultural Cooperative Bank the provisions of the Subsistence Allowance Act would not be applicable and the 3rd respondent ought to have challenged the impugned order by invoking the provisions of Section 153 of the Cooperative Societies Act.
13. On the other hand the learned counsel for the 3rd respondent would contend that the 3rd respondent is a cadre employee governed by Tamil Nadu Primary Agricultural Cooperative Bank Common Cadre Regulations as set out in GO.Ms.No.55 dated 24.03.2000. In this regard, a perusal of the order of suspension dated 12.08.2004 issued by the petitioner to the 3rd respondent would clearly show that the suspension order had been issued invoking the provisions of the Subsistence Allowance Act, 1981. The order would read as follows:
“murhiz vz;/55 Tl;Lwt[ czt[ kw;Wk;
Efu;nthu; ghJfhg;g[j;Jiw ehs;/ 24/03/2000y;
11/20 https://www.mhc.tn.gov.in/judis ( Uploaded on: 02/09/2025 04:22:39 pm ) W.P.No. 2821 of 2023 tpjpKiwfs; 29 (e) d; fPHhd mjpfhu xg;gtpg;gpd;go tlifyhrk; bjhlf;f ntshd;ik Tl;Lwt[ t';fpapy; brayhsu; jpU/nf/kjpaHfd; vd;gtiu t';fpapy; eilbgw;Ws;s fLk; epjpKiwnfLfs; bjhlu;ghf ,tu; kPJ bjhlug;glt[s;s xGf;f eltof;ifia vjpu;nehf;fp t';fp eyd; kw;Wk; bghJ eyk; fUjp 12/8/2004 gpw;gfy; Kjy; jw;fhypf gzpePf;fj;jpy; itj;J Mizaplg;gLfpwJ/ ,tUf;F capu;g{jpa rl;lk; 1981d; go
tpjpKiwfSf;Fl;gl;L jFjpa[ila capu;g;g{jpak; tH';fg;glntz;Lk;/
14. Further, it is an admitted fact that the 3rd respondent is a cadre employee. Therefore, as per the proviso to regulation 29 d (i) it is provided as follows:
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15. In the Judgement of the Special Officer, M.Pakkam Primary Agricultural Cooperative Bank, Madurantagam Taluk, Kancheepuram Vs. M.Srinivasan - 2009 (7) MLJ 1025, the First Bench of this Court was considering the challenge by the Cooperative Bank to the order passed by the Single Judge granting subsistence allowance to the petitioner during the period of suspension. The argument that was advanced therein was that the 1st respondent therein who was working as a Secretary was not employed as contemplated under the Subsistence Allowance Act, relying upon the Judgement reported in 2009 (1) MLJ 18 – Kuthiraichandal Primary Cooperative Bank Ltd., Vs. A.Asokan.
16. The learned Judges distinguished the Judgement in Kuthiraichandal Primary Cooperative Bank Ltd., Vs. A.Asokan by 13/20 https://www.mhc.tn.gov.in/judis ( Uploaded on: 02/09/2025 04:22:39 pm ) W.P.No. 2821 of 2023 contending that regulations had been framed under the Cooperative Societies Act, however relying upon the language of Regulation 29 (d)
(i) the Bench held that the 1st respondent therein was entitled to subsistence allowance as per the Subsistence Allowance Act though the Regulation has been issued under the Cooperative Societies Act.
17. This Judgement of the Hon'ble Division Bench was followed by another Division Bench in W.A.No.1569 of 2012 - Special Officer Vs. Periyannan and another. The Bench relying upon the Judgement in Special Officer Vs. M.Srinivasan held that the substantial right accrued under the Regulation 29 (d) (i) of the procedure referred to as per the Subsistence Allowance Act.
18. Even in the Judgement referred to by the learned counsel for the petitioner, namely, M.Kanagasabapathy Vs. Special Officer 2007 5 CTC 392, the Hon'ble Supreme Court discussed the difference between the Subsistence Allowance Act and the Cooperative Societies 14/20 https://www.mhc.tn.gov.in/judis ( Uploaded on: 02/09/2025 04:22:39 pm ) W.P.No. 2821 of 2023 Act. The Hon'ble Supreme Court had held as follows in paragraph Nos.64 and 65:
“64.Though as held by us, the appellant is entitled to invoke the provisions of the Act 43 of 1981 to claim subsistence allowance for the period of suspension pending enquiry, the same would be subject to the appellant satisfying the position that he would fall within the definition of an 'employee' as defined under Section 2
(a) of the Act 43 of 1981. The first respondent herein, in his counter statement before the second and third respondents has specifically raised a plea that being a Secretary – in – charge, the appellant would not fall within the definition of an employee in stricto senso.
65. Unfortunately, neither the third respondent nor the second respondent have ventured to deal with the said issue in the proper manner. Therefore, even while holding that the appellant is entitled to invoke the provisions of 15/20 https://www.mhc.tn.gov.in/judis ( Uploaded on: 02/09/2025 04:22:39 pm ) W.P.No. 2821 of 2023 the Act 43 of 1981 and while setting aside the order of the learned single Judge, we have no hesitation in setting aside the orders of the second and third respondents impugned in the writ petition and remit the matter back to the third respondent to take up the application of the appellant in PSA No.2 and 3 of 2002 and decide the same after giving a specific finding as to the question whether the appellant falls within the definition of an 'employee' as defined under the Section 2(a) of Act 43 of 1981 and in the event of the third respondent reaching a conclusion that the appellant satisfies the definition of an 'employee' he would be free to pass orders as to the question of subsistence allowance, if any, payable to the appellant. ” Thereby holding that the appellant would come within the definition of “employee”, if he is able to satisfy the authority/Court that he continued to discharge the duties of an employee though he is given the post of Secretary.
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19. However, in the case on hand the issue of considering the status of the 3rd respondent as set out in Section 2 (a) of the Subsistence Allowance Act would pale into insignificance since the 3rd respondent is a common cadre employee and governed by Regulations as set out in GO.Ms.No.55, Cooperation, Food and Consumer Protection Department. This regulation clearly provides that the cadre employee who is under suspension is entitled to subsistence allowance as per the Subsistence Allowance Act. The suspension order issued by the petitioner also highlights the same.
20. This Court had an occasion to consider the very same issue in the Judgement in WP.No.21238 of 2022 – The Management Modakkurichi Circle Teachers and Public Servants Cooperative Thrift and Credit Society Ltd., Vs. The Joint Commissioner of Labour, Erode. Relying upon the Judgement in Kuthiraichandar Primary Cooperative Bank Limited and the Special byelaws, this Court had upheld the order passed by the 1st respondent. 17/20 https://www.mhc.tn.gov.in/judis ( Uploaded on: 02/09/2025 04:22:39 pm ) W.P.No. 2821 of 2023
21. Since the 3rd respondent is a common cadre employee governed by the regulations in GO.Ms.No.55, the arguments that he has to prove he is an employee as defined under 2 (a) may not arise in the instant case.
22. Therefore, in the light of the above discussion the argument that the 3rd respondent should only exhaust the alternate remedy under Section 153 of the Tamil Nadu Cooperative Societies Act, and not the Subsistence Allowance Act cannot be countenanced. Accordingly, the Writ Petition stands dismissed. Consequently, the connected miscellaneous petition is closed. No costs.
02.09.2025 Index: Yes/No Speaking order/non-speaking order Neutral Citation: Yes/No kan 18/20 https://www.mhc.tn.gov.in/judis ( Uploaded on: 02/09/2025 04:22:39 pm ) W.P.No. 2821 of 2023 To
1.The Appellate Authority under the Tamil Nadu Payment of Subsistence Allowance Act / Joint Commissioner of Labour – II, Chennai – 6.
2.The Deputy Commissioner of Labour (Additional Charge) O/o, Joint Commissioner of Labour – II, Chennai – 6.
19/20 https://www.mhc.tn.gov.in/judis ( Uploaded on: 02/09/2025 04:22:39 pm ) W.P.No. 2821 of 2023 P.T.ASHA, J., kan Pre Delivery Order in W.P.No. 2821 of 2023 02.09.2025 20/20 https://www.mhc.tn.gov.in/judis ( Uploaded on: 02/09/2025 04:22:39 pm )