IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED :12.10.2007 CORAM THE HON'BLE MR. JUSTICE F.M. IBRAHIM KALIFULLA and THE HON'BLE MRS. JUSTICE R. BANUMATHI W.A.No.3346 of 2003 and W.A.M.P.Nos.5365 and 5366 of 2003 M.Kanagasabapathy ..Appellant/3rd Respondent in WP 10291/03 Vs. 1.The Special Officer S.390, Pothanoor Primary Agricultural Cooperative Bank Ltd., Pothanoor, Paramathivelur Taluk Namakkal District 638 181. ..Respondent/Petitioner in WP 10291/03 2.The Appellate Authority under the Payment of Subsistence Allowance Act/ Deputy Commissioner of Labour Salem-7. ..Respondent/1st Respondent in WP 10291/03 3.The Authority under The Payment of Subsistence Allowance Act/ Assistant Commissioner of Labour, Salem -7. ...Respondent/2nd Respondent in WP 10291/03 For Appellant : Mr.K.Premkumar For Respondent No.1 : Mr.M.S.Palaniswamy For Respondents No.2 & 3 : Mr.P.S.Raman Additional Advocate General assisted by Mr.M.Dhandapani, Special Government Pleader https://hcservices.ecourts.gov.in/hcservices/ Writ Appeal preferred under clause 15 of letter patent appeal against the order of the Hon'ble Mr.Justice K.Raviraja Pandian dated 13.8.2003 and made in WP 10291/03 presented to this Court under Article 226 of the constitution of India to issue a writ of Certiorari to call for the records in P.S.A.5/2002 on the file of the Deputy Commissioner of Labour Salem-7, by his order dated 24.02.03 and quash the same. JUDGMENT F.M. IBRAHIM KALIFULLA, J. The appellant is aggrieved against the order of the learned single Judge, dated 13.8.2003 passed in W.P.No.10291 of 2003. 2. The issue relates to payment of subsistence allowance payable to the appellant for the period of suspension pending disciplinary action. 3. The appellant was placed under suspension by the first respondent on 25.1.1999 pending disciplinary action against him. Alleging non payment of subsistence allowance, the appellant preferred PSA No.2/02 and 3/02 claiming subsistence allowance for two different periods. By order, dated 12.7.2002, the third respondent ordered a sum of Rs.12122/- in PSA.No.2/02 and Rs.53276/- in PSA No.3/02 to be payable by the first respondent to the appellant. Both the appellant and the first respondent preferred PAA Case No.5/02-1 and 5/02 before the second respondent. The second respondent also confirmed the order of the third respondent by his order, dated 24.2.2003. 4. Aggrieved against the same, the first respondent preferred W.P.No.10291 of 2003. The said writ petition was allowed by the learned Single Judge by applying the decision of another learned Single Judge reported in 2002 4 CTC 339. In the said decision, it was held that a Secretary in a Bank to which the Tamil Nadu Co-operative Societies Act, 1983 is applicable is an officer as defined in Section 2(19) of the said Act and therefore, he cannot be construed as an employee under the Tamil Nadu Payment of Subsistence Allowance Act. It was also held that since the Tamil Nadu Co-operative Societies Act,1983, is a special enactment, provisions of the Tamil Nadu Subsistence Allowance Act cannot be applied. Following the same, the impugned order was passed by the learned Single Judge allowing the writ petition of the first respondent and set aside the orders passed by the second and third respondents. https://hcservices.ecourts.gov.in/hcservices/ 5. Aggrieved against the same, the appellant has come forward with this writ appeal. 6. In this appeal, two questions arise for consideration, namely:- a. whether the ratio laid down by the learned single Judge in the decision reported in 2002 (4) CTC 339 to the effect that the Tamil Nadu Co-operative Societies Act, 1983 is a special enactment and therefore, the Tamil Nadu payment of subsistence allowance Act will not be applicable to a Secretary, who has been defined as an officer under Section 2 (19) of the 1983 Act is proper or not. b. If the Tamil Nadu payment of subsistence allowance Act applies, whether the first respondent can contend that the appellant will not fall under the definition of "employee" as defined under Section 2 (a) of the Tamil Nadu payment of subsistence allowance Act. 7. In order to clarify the above legal issues, we sought the assistance of the Additional Advocate General Mr.P.S.Raman, who made his submissions with absolute clarity highlighting the various intricate position involved and also placing before us the various decisions touching upon the very question. After referring to the provisions contained in Section 2(a) of the Tamil Nadu Payment of Subsistence Allowance Act, 1981, (hereinafter called as Act 43 of 1981), and Section 2(19) of the Tamil Nadu Cooperative Societies Act, 1983 (hereinafter called as Act 30 of 1983), which contains the respective definition clause of an "employee" and an "officer" under both the enactments referred to various decisions reported in AIR 1979 SC 1203(The Gujarat State Co-operative Land Devlopment Bank Ltd., Vs. P.R.Mankad and another), AIR 1980 SC 2181(The Life Insurance Corporation of India Vs. Bahadur and others), AIR 1970 SC 245(Co- operative Central Bank Ltd., and others etc. Vs. Additional Industrial Tribunal, Andhra Pradesh, Hyderabad and others etc.), AIR 1961 SC 1762 (Major E.G. Barsay Vs. State of Bombay), AIR 1966 SC 1931(Maharaja Pratap Singh Bahadur Vs. Thakuar Manmohan Dey and others), AIR 1968 SC 898(Board of Revenue for Rajasthan, Ajmer and others Vs. Rao Baldev Singh and others), AIR 1999 SC 3907(Gobind Sugar Mills Ltd. Etc., State of Bihar and others), AIR 2000 SC 1535(Allahabad Bank Vs.Canara Bank and another) and 2005(4) SC 613(V.M.Salgaocar and Brothers Vs. Board of Trustees of Port of Mormugao and another). Applying the ratio decidendi of the above referred to decisions, the learned Additional Advocate General contended that it will have to be held that in the context of the issue involved, namely, the claim for payment of subsistence allowance as against the first respondent, the 1983 Act would be a general statute and the 1981 Act should be construed as special enactment and consequently, it will have to be https://hcservices.ecourts.gov.in/hcservices/ examined whether the appellant would come under the definition of 'employee' in order to maintain his claim under the 1981 Act. In other words, according to the learned Additional Advocate General, the claim of the appellant cannot be thrown out on the ground that the 1983 Act is a special enactment and therefore, 1981 Act will not be applicable to the claim of the appellant. 8. We also heard the learned counsel for the appellant as well as the first respondent. 9. To appreciate the submissions of the learned Additional Advocate General, we deem it appropriate to refer to the principles set out in the various decisions before rendering our conclusions. 10. Section 2(a) of the Tamil Nadu Payment of Subsistence Allowance Act, 1981 defines an employee to mean as under: Section 2(a): "employee" means any person employed in, or in connection with the work or activities of, any establishment to do any skilled, semi-skilled or unskilled, manual, supervisory, technical, clerical or any other kind of work or activities for hire or reward, whether the terms of employment be expressed or implied, but does not include any such person- Who is employed mainly in a managerial or administrative capacity; or Who, being employed in a supervisory capacity, draws wages exceeding five hundred rupees per mensem or exercises, either by the nature of the duties attached to the office or by reason of the powers vested to him, functions mainly of a managerial nature;" 11. In 1983 Act, an officer has been defined asunder under Section 2(19). "Section 2(19) : "Officer" includes a president, vice-president, managing director, secretary, assistant secretary, member of board and any other person empowered under the the Rules or the bye-laws to give directions in regard to the business of the registered society;" 12. In P.Ramanatha Aiyer's Advanced Law Lexicon, the maxim "Generalia specialibus non derogant" has been explained, wherein it is stated asunder: "Special Acts are not repealed by general Acts https://hcservices.ecourts.gov.in/hcservices/ unless there be some express reference to the previous legislation, or a necessary inconsistency in the two Acts standing together, which prevents the maxim from being applied. The above principle has been set out in the decision of Harlow v. Minister of Transport, (1951) 2 KB 98." 13. By the order impunged in this writ petition, the learned single Judge by merely following the decision reported in 2002 (4) CTC 339 (The Management, T.P.Spl. 67 Goundanpalayam Primary Agricultural Cooperative Bank Ltd., by its President Goundanpalayam Kanzeyam via Erode District Vs. The Assistant Commissioner of Labour, The Authority under the Payment of Subsistence Allowance Act, Salem and another) allowed the writ petition. 14. In the said decision, paragraph 9, 10 and 12 are relevant for our present purpose which reads as under. "9. Therefore, since the second respondent being the Secretary, is classified as an "officer" under the Tamil Nadu Cooperative Societies Act, 1983 which is applicable to him and therefore, there is no question of a second thought whether he could be again re-classified as an "employee" much less falling within the purview of the definition Section 2(a) of the Tamil Nadu Payment of Subsistence Allowance Act, 1981 which question will not arise at all. Therefore, basically, it has to be decided whether the second respondent is an "officer" defined under the definition Section 2(19) of the Tamil nadu Cooperative Societies Act, 1983 or a mere "employee" as defined under Section 2(a) of the Tamil Nadu Payment of Subsistence Allowance Act, 1981. Needless to mention that once the definition of "officer" as per the Tamil Nadu Cooperative Societies Act, 1983 is applicable to the second respondent, automatically, the other definition under Section 2(a) of the Tamil Nadu Payment of Subsistence Allowance Act, 1981 would not be attracted at all. 10. The second respondent, admittedly the Secretary of the petitioner Bank, squarely falls under the definition of "Officer" as defined under the definition Section 2(19) of the Tamil Nadu Cooperative Societies Act, 1983 and he is bound by the Tamil Nadu Cooperative Societies Act and Rules and would not fall under any other Act, much less the Tamil Nadu Payment of Subsistence Allowance Act, 1981 as an "employee". The one and the same authority cannot be an "Officer" and an "employee", nor could he be taken both as an https://hcservices.ecourts.gov.in/hcservices/ "Officer" for the purpose of Cooperative Societies Act and could be taken as an "employee" for the purpose of Tamil Nadu Payment of Subsistence Allowance Act, and therefore, since the second respondent having been the Secretary of the petitioner Bank and falling under the definition Section 2(19) of the Tamil Nadu Cooperative Societies Act, 1983 as an "Officer", he cannot be classified otherwise than this for any purpose much less for the purpose of Payment of Subsistence Allowance. 12. For all the above discussions held and the reasons assigned, the second respondent cannot be defined as an "employee" under the Tamil Nadu Payment of Subsistence Allowance Act, 1981 since he is an "Officer" as defined under the definition section 2 (19) of the Tamil Nadu Cooperative Societies Act, 1983 and as such he is not entitled to file an application before the first respondent herein so as to become entitled to get an order as passed by the said authority, which is impugned herein since the first respondent is ousted from assuming jurisdiction in such matters. In result, (i)the above writ petition succeeds and the same is allowed. (ii)the order passed by the first respondent dated 29.6.1998 in Payment of Subsistence Allowance Case Nos.4 of 1998 and 13 of 1998 is quashed. Consequently, W.P.M.P.24249 of 1998 is closed. However, in the circumstances of the case, there shall be no order as to costs." 15. The conclusion of the learned Judge in the above reported judgment was to the effect that once the secretary falls under the definition of an "officer" under Section 2(19) of the 1983 Act which according to the learned Judge is a special legislation, he cannot be further defined as an 'employee' under the 1981 Act since the 1983 Act is a special enactment having overriding powers on other general acts. Therefore, our primary concern is to examine whether such a conceptual conclusion of the learned single Judge can be accepted or not. 16. In order to arrive at correct legal position, it will be appropriate to examine various decisions of the Hon'ble Supreme Court on this aspect. In AIR 1979 SUPREME COURT 1203 (The Gujarat State Co-operative Land Development Bank Ltd., Vs. P.R.Mankad and https://hcservices.ecourts.gov.in/hcservices/ another), a similar question came up for consideration. There, the legislations were Bombay Co-operative Societies Act 1925, vis-a-vis, Bombay Industrial Relations Act 1946. In paragraph 14 of the said judgment, based on the arguments of the learned counsel appearing for the Society, the Hon'ble Supreme Court summarise the contentions to be answered. Sub para IV to para 14 reads asunder. "(iv) Once it is held that the dispute between the Society and its past servant, Babu Bhai Negracha, touches the 'business' or the 'management' of the Society, or both, within the meaning of Section 96, the Registrar or his nominee, alone shall have jurisdiction to adjudicate such dispute by compulsory arbitration; and the non obstante clause in the section shall bar the determination of that dispute by the Industrial Tribunal or the Labour Court under the Bombay Industrial Relations Act." 17. While dealing with the said issue, the Hon'ble Supreme Court has stated the legal position as under in paragraph 29:- "29. The matter can be looked at from another angel also. The law of industrial disputes or industrial relations is a special law dealing with rights and obligations specially created by it. As against this, the provision in Section 54 of the Act of 1925/Section 96 of the Act of 1961 is a general provision. In accordance with the maxim generalia specialibus non derogant, therefore, nothing in these general provisions can derogate from B.I.R. Act and the Co-operative Society Act must yield to the special provisions in the Bombay Industrial Relations Act, whenever a dispute clearly comes within the language of the latter Act." 18. If what was stated in the above paragraph is relatable to the provisions of the 1981 Act, it will have to be held that 1983 Act would be a general legislation and the 1981 Act being a special enactment, 1981 Act alone will prevail. 19. In AIR 1980 Supreme Court 2181 (The Life Insurance Corporation of India Vs. D.J. Bahadur and others), the question arose as to whether the Life Insurance Corporation Act is a general enactment or special enactment compared with the provisions of the Industrial Disputes Act. 20. After analysing the various provisions of the LIC Act and the ID Act, the Hon'ble Supreme Court, has stated the legal position as under in paragraphs 30 and 31. https://hcservices.ecourts.gov.in/hcservices/ "30. Be that as it may, as bird's eye view of the ID Act reveals the statutory structure and legal engineering centering round dispute settlement in industries according to the rule of law and away from fight with fists or economic blackmail. This large canvas once illumined may illustrate the sweep, of awards and settlements by reference to the very agreement of 1974 we have before us. It goes for beyond bonus and embraces a wide range of disputes and rainbow of settlements in a spirit of give and take . One may visualise the bargaining process. Give in a little on bonus and get a better deal on salary scale or promotion prospects; relent a wee-bit on hours of work but bargain better on housing facilities, and so on. The soul of the statute is not contract of employment, uniformity of service conditions or recruitment rules, but conscionable negotiations, conciliations and adjudications of disputes and differences animated by industrial justice, to avoid a collision which may spell chaos and imperil national effort at increasing the tempo of production. 31. If there is no dispute, the ID Act is out of bounds, while the LIC Act applies generally to all employees from the fattest executive to the frailest manual worker and has no concern with industrial disputes. The former is a 'war measure' as it were; the latter is a routine power when swords are not drawn if we may put it metaphorically. When disputes break out or are brewing, a special, sensitive situation fraught with frayed tempers and fighting postures springs into existence, calling for special rules of control, conciliatory machinery, demilitarising strategies and methods of investigation, interim arrangements and final solutions, governed by special criteria for promoting industrial peace and justice. The LIC Act is not a law for employment or disputes arising therefrom, but a nationalisation measure which incidentally, like in any general take-over legislation, provides for recruitment, transfers, promotions and the like. It is special vis-a-vis nationalisation of life insurance but general regarding contracts of employment or acquiring office buildings. Emergency measures are special, for sure. Regular nationalisation statutes are general even if they incidentally refer to conditions of service." (Emphasis added) https://hcservices.ecourts.gov.in/hcservices/ 21. A reading of the above paragraphs goes to show that a statute can be construed as special when its main purport and object of the act is taken into account while at the same time when the application of the said Act is comparatively considered with a statute like the Industrial Dispute Act which out and out deals with employment, non-employment and conditions of labour in respect of an industry it would become a special enactment and that the maxim 'Generalia Specialibus non derogant' would apply and thereby would exclude the applicability of the other enactment on that basis. 22. In paragraphs 51 and 52 the Hon'ble Supreme Court has given certain guidelines as to how to find out whether a statute is a special or a general one, wherein it is stated as under:- "51. In determining whether a statute is a special or a general one, the focus must be on the principal subject matter plus the particular perspective. For certain purposes, an Act may be general and for certain other purposes it may be special and we cannot blur distinctions when dealing with finer points of law. In law, we have a cosmos of relativity not absolutes – so too in life. The ID Act is a special statute devoted wholly to investigation and settlement of industrial disputes which provides definitionally for the nature of industrial disputes coming within its ambit. It creates an infra-structure for investigation into, solution of and adjudication upon industrial disputes. It also provides the necessary machinery for enforcement of awards and settlements. From alpha to omega the ID Act has one special mission – the resolution of industrial disputes through specialised agencies according to specialised procedures and with special reference to the weaker categories of employees coming within the definition of workmen. Therefore, with reference to industrial disputes between employers and workmen, the ID Act is a special statute, and the LIC Act does not speak at all with specific reference to workmen. On the other hand, its powers relate to the general aspects of nationalisation, of management when private businesses are nationalised and a plurality of problems which, incidentally, involve transfer of service of existing employees of insurers. The workmen qua workmen and industrial disputes between workmen and the employer as such are beyond the orbit of and https://hcservices.ecourts.gov.in/hcservices/ have no specific or special place in the scheme of the LIC Act. And whenever there was a dispute between workmen and management the ID Act mechanism was resorted to. 52. What are we confronted with in the present case, so that I may determine as between the two enactments which is the special? The only subject which has led to this litigation and which is the bone of contention between the parties is an 'industrial dispute between the Corporation and its workmen' qua workmen. If we refuse to be obfuscated by legal abracadabra and see plainly what is so obvious, the conclusion that flows, in the wake of the study I have made, is that vis-a-vis 'industrial disputes' at the termination of the settlement as between the workmen and the Corporation the ID Act is a special legislation and the LIC Act a general legislation. Likewise, when compensation on nationalisation is the question, the LIC Act is the special statute. An application of the generalia maxim as expounded by English text-books and decisions leaves us in no doubt that the ID Act being special law, prevails over the LIC Act which is but general law." (Emphasis added) 23. Again in paragraph 55, the Hon'ble Supreme Court has stated as under:- "What is special or general is wholly a creature of the subject and context and may vary with situation, circumstances and angle of vision. Law is no abstraction but realises itself in the living setting of actualities. Which is a special provision and which general, depends on the specific problem, the topic for decision, not the broad rubric nor any rule of thumb. The peaceful co-existence of both legislations is best achieved, if that be feasible, by allowing to each its allotted field for play. Sense and sensibility, not mechanical rigidity gives the flexible solution. .....To avoid absurdity and injustice by judicial servitude to interpretative literally is a function of the Court and this leaves me no option but to hold that the ID Act holds were disputes erupt and the LIC Act guides where other matters are concerned....These plural considerations lead me to the conclusion that the ID Act is a special statute when industrial disputes, awards and settlements are the topic of controversy, as here. There may be other matters where the LIC Act https://hcservices.ecourts.gov.in/hcservices/ vis-a-vis the other statutes will be a special law. I am not concerned with such hypothetical situations now." (Emphasis added) 24. In AIR 1970 Supreme Court 245 (Co-operative Central Bank Ltd. and others etc. Vs. Additional Industrial Tribunal, Andhra Pradesh, Hyderabad and others etc.) the question arose whether the Industrial Tribunal dealing with the dispute relating to conditions of service of employees of the Co-operative Society would be competent to alter any such condition which would conflict with bye- laws of the concerned Co-operative Society. In that context, the Hon'ble Supreme Court has stated as under in paragraph 10:- "10. We are unable to accept the submission that the bye-laws of a co-operative society framed in pursuance of the provisions of the Act can be held to be law or to have the force of law. It has no doubt been held that, if a statute gives power to a Government or other authority to make rules, the rules so framed have the force of statute and are to be deemed to be incorporated as a part of the statute. That principle, however, does not apply to bye-laws of the nature that a co-operative society is empowered by the Act to make. The bye-laws that are contemplated by the Act can be merely those which govern the internal management, business or administration of a society. They may be binding between the persons affected by them, but they do not have the force of a statute. In respect of bye-laws laying down conditions of service of the employees of a society, the bye-laws would be binding between the society and the employees just in the same manner as conditions of service laid down by contract between the parties. In fact, after such bye-laws laying down the conditions of service are made and any person enters the employment of a society those conditions of service will have to be treated as conditions accepted by the employee when entering the service and will thus bind him like conditions of service specifically forming part of the contract of service. The bye-laws that can be framed by a society under the Act are similar in nature to the Articles of Association of a Company incorporated under the Companies Act and such Articles of Association have never been held to have the force of law. In a number of cases, conditions of service for industries are laid down by Standing Orders certified under the Industrial Employment (Standing Orders) Act, 1946, and it has been held that, though such Standing https://hcservices.ecourts.gov.in/hcservices/ Orders are binding between the employers and the employees of the industry governed by these Standing Orders, they do