IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 14.2.2011 CORAM: THE HONOURABLE MR.JUSTICE P.JYOTHIMANI W.P.Nos.12312 to 12314, 12776, 13475 and 14077 of 2003 and 18160 and 18161 of 2009 V.Kandasamy .. Petitioner in WP No.12312/2003 T.Rajasekharan ..Petitioner in WP No.12313/2003 P.Venkatesan ..Petitioner in WP No.12314/2003 A.Rajavel ..Petitioner in WP No.12776/2003 K.Ganeshmoorthy ..Petitioner in WP No.13475/2003 K.Durairaju ..Petitioner in WP No.14077/2003 G.Senguttuvan ..Petitioner in WP No.18160/2009 S.Rajendran ..Petitioner in WP No.18161/2009 Vs. 1. The Special Officer Virudhachalam Agricultural Producers Co-operative Sales Society – E1430 17, Periyar Nagar North, Cuddalore Road Virudhachalam – 606 001. ..Ist respondent in WP 12312 to 12314/03, 12776, 13475,14077/2003 2. The Registrar of Co-operative Societies NVN Natarajanmaligai, Kilpauk Chennai – 600 010. ..2nd Respondent in WP 12312 to 12314/03, 12776, 13475, 14077/2003 R1 in WP 18160 & 18161/09 3. The Joint Registrar of Co-operative Societies, Cuddalore Region, Cuddalore District ..R2 in WP 18160 & 18161/09 https://hcservices.ecourts.gov.in/hcservices/ Prayer in WP Nos.12312 to 12314, 12776,13475 and 14077 of 2003 : Petitions filed under article 226 of the constitution of India, praying to issue a writs of certiorarified mandamus calling for the records of the first respondent herein relating to the retrenchment notice dated 1.3.03, issued by the first respondent herein under sec.25-F of the Industrial Disputes Act relating to the petitioners services as a clerk in first respondent society quash the same and direct the first respondent to continue the services of the petitioner as before with all attendant benefits. Prayer in WP Nos.18160 & 18161 of 2009 : Petitions filed under article 226 of the constitution of India, praying to issue a writs of certiorarified mandamus calling for the records of the retrenchment notice of the 3rd respondent dated 1.3.03 and the consequential order of the 2nd respondent in Na.Ka.No.747/2006, Tha.Va.Tha.1 dated 30.4.2007, and the further order of the 2nd respondent in Na.Ka.No.7039/07, Tha.Va.Tha.I dated 7.5.2009, quash the same and consequentially direct the respondent to confer the posting to the petitioner as a movement assistant in Vridhachalam Agricultural Producers Co-operative marketing Society, E-1430, with continuity of service with all attendant and consequential monetary benefits and with due regards to the seniority of the petitioners. For Petitioners : Mr.AR.L.Sundaresan in all WPs Senior Counsel for M/s.AL.Gandhimathi For 1st respondent : Mr.R.Subbiah in WPs:12312 to 12314 12776, 13475 and 14077 of 2003 and 3rd respondent in WP:18160 and 18161 of 2009 For 2nd respondent : Mr.N.Senthilkumar in WPs:12312 to 12314 Additional Govt. Pleader 12776, 13475 and 14077 of 2003 and respondents 1 and 2 in WP:18160 and 18161 of 2009 ORDER The facts leading to the filing of these writ petitions, in a nutshell, are as follows: https://hcservices.ecourts.gov.in/hcservices/ 2.1. The first respondent in W.P.Nos.12312 to 12314, 12776, 13475 and 14077 of 2003, which is arrayed as the third respondent in W.P.Nos.18160 and 18161 of 2009, namely Virudhachalam Agricultural Producers Co-operative Sales Society, is a society registered under the Tamil Nadu Co-operative Societies Act (for short, "the Act"), and is now under the control of the Special Officer appointed by the Government. The said society was registered in the year 1941 and from 1.10.1987 onwards it became a Lead Society vested with the duty of taking stock of essential commodities such as wheat, sugar, rice, etc. from Tamil Nadu Civil Supplies Corporation godowns, transporting and supplying the same to nearly 342 Public Distribution Shops under the control of 54 Primary Agricultural Co-operative Banks, which are Link Societies situated in Virudhachalam and Thittakudi Taluks in Cuddalore District. 2.2. The Registrar of Co-operative Societies, namely the second respondent in W.P.Nos.12312 to 12314, 12776, 13475 and 14077 of 2003 and first respondent in W.P.Nos.18160 and 18161 of 2009, issued proceedings dated 22.8.2002, which was followed by proceedings dated 23.8.2002 of the Joint Registrar of Co-operative Societies, Cuddalore Region seeking to cancel the the status of the Lead Society of the Virudhachalam Agricultural Producers Co-operative Sales Society and to designate Chidamabaram Agricultural Producers Co-operative Marketing Society as the Lead Society in its place. 2.3. The Tamil Nadu Co-operative Marketing Societies Employees' Association (Virudhachalam Unit) filed W.P.No.35605 of 2002 challenging the said proceedings of the Registrar of Co-operative Societies, which came to be dismissed by this Court on 28.11.2002 holding that the employees of the society cannot maintain the writ petition. Aggrieved by the said order, the Association filed W.A.No.3925 of 2002. 2.4. The Virudhachalam Agricultural Producers Co-operative Sales Society issued notices dated 1.3.2003 to the petitioners, purported to be under Section 25-F of the Industrial Disputes Act, 1947 stating that since there was no operation, for which the society was incorporated, and it was running under loss and since there was no work for the employees of the society and wages could not be paid, it was decided to retrench the petitioners, stating that on the expiry of thirty days period from the date of receipt of the notices, the said petitioners stand removed from services. The said notices issued under Section 25-F of the Industrial Disputes Act, 1947 are challenged by the petitioners in W.P.Nos.12312 to 12314, 12776, 13475 and 14077 of 2003. 2.5. Thereafter, on 25.6.2008, all the functions of the Lead Society for all areas have been retransferred to the Virudhachalam Agricultural Producers Co-operative Sales Society from Chidambaram https://hcservices.ecourts.gov.in/hcservices/ Agricultural Producers Co-operative Marketing Society and recording the said fact, the writ appeal in W.A.No.3925 of 2002 came to be closed on 22.6.2010. 2.6. The petitioners in W.P.Nos.12312 to 12314, 12776, 13475 and 14077 of 2003 have joined in the services of the Virudhachalam Agricultural Producers Co-operative Sales Society as Salesman, Clerk, Lorry Consume Assistant and Accountant. The petitioners in W.P.Nos.18160 and 18161 of 2009, who were also employed in the Virudhachalam Agricultural Producers Co-operative Sales Society, against whom also similar retrenchment notices were given by the society on 1.3.2003, have challenged the said notices in W.P.Nos.25681 of 2006 and 11870 of 2007 respectively. The said writ petitions were disposed by this Court on 21.8.2006 and 8.8.2008 respectively, with liberty to the said petitioners to file revisions under Section 153 of the Act before the Joint Registrar of Co- operative Societies. 2.7. The petitioners in W.P.Nos.18160 and 18161 of 2009 filed revisions before the Joint Registrar under Section 153 of the Act and the revisions came to be dismissed on 30.4.2007 and 31.12.2007 respectively. It was against the said orders passed by the Joint Registrar in revisions, review petitions were filed under Section 154 of the Act by the petitioners in W.P.Nos.18160 and 18161 of 2009 before the Joint Registrar and the review petitions came to be dismissed on 7.5.2009 and 26.9.2008 respectively. It was as against the said orders of the Joint Registrar W.P.Nos.18160 and 18161 of 2009 were filed. 2.8. All these writ petitions are filed on the grounds that the impugned notices given under Section 25-F of the Industrial Disputes Act are arbitrary and illegal and the reasons adduced in the notices that there is no work or business to the society or that the society is incurring loss are not genuine reasons warranting retrenchment; that the lack of business was not due to the society, but it was due to the Co-operative Department by cancelling the status of the society as a Lead Society and designating Chidamabaram Agricultural Producers Marketing Society Limited as a Lead Society and the respondent/Department having contributed for such lack of business to the society, cannot take advantage and retrench the workmen by issuing notices under Section 25-F of the Industrial Disputes Act; and that the transfer of business of Lead Society from Virudhachalam Agricultural Producers Co-operative Sales Society to Chidamabaram Agricultural Producers Co-operative Marketing Society, has been subsequently reverted and the same has been recorded in the judgment in W.A.No.3925 of 2002 and therefore, there is no necessity for continuing the retrenchment as on date. 2.9. Likewise, the orders passed by the Joint Registrar of Co- operative Societies under the Act in the revisions as well as the https://hcservices.ecourts.gov.in/hcservices/ review petitions are challenged by the petitioners in W.P.Nos.18160 and 18161 of 2009 on the grounds that they are in violation of the principles of natural justice; and that the Joint Registrar of Co- operative Societies, under similar circumstances, in respect of other staff, viz., S.Akbar Basha and M.Ramasamy, has allowed their review petitions and therefore, the Joint Registrar is biased. 3. In the counter affidavit filed by the society, which is the first respondent in W.P.Nos.12312 to 12314, 12776, 13475 and 14077 of 2003 and the third respondent in W.P.Nos.18160 and 18161 of 2009, it is stated that the society was incurring heavy loss on account of the transfer of status of Lead Society to Chidamabaram Agricultural Producers Co-operative Marketing Society; and that the notices under Section 25-F of the Industrial Disputes Act were issued to the petitioners due the absence of any marketing activity because of the transfer of Lead Society status to Chidamabaram Agricultural Producers Co-operative Marketing Society and therefore, there is nothing unlawful or illegal, especially when the purpose for which the society was constituted has not been fulfilled due to various reasons which were not under the control of the society. 4.1. It has been the stand of the Registrar of Co-operative Societies, who has been arrayed as second respondent in W.P.Nos.12312 to 12314, 12776, 13475 and 14077 of 2003 and as the first respondent in W.P.Nos.18160 and 18161 of 2009, apart from the Joint Registrar of Co-operative Societies, who is the second respondent in W.P.Nos.18160 and 18161 of 2009, that Virudhachalam Agricultural Producers Co-operative Sales Society was registered under the provisions of the Act and the said society was involved in procurement and marketing of agricultural produce, processing and distribution of agricultural produce among other things. It is also stated that the said society was entrusted with lift-ment of essential commodities and distributing them to the link societies and since it was incurring huge loss, it was decided to transfer the Lead Society business to Chidamabaram Agricultural Producers Co-operative Marketing Society and after the transfer of business, Virudhachalam Agricultural Producers Co-operative Sales Society was not doing any other business, except running eight fair price shops and a kerosene bunk. 4.2. It is stated that since there was no work for all the 28 staff in the society, it was decided to retrench 17 staff on seniority basis and accordingly, notices were issued under Section 25-F of the Industrial Disputes Act against 17 workmen on 1.3.2003 by giving thirty days time. 4.3 In the counter affidavit, it is admitted that Virudhachalam Agricultural Producers Co-operative Sales Society was appointed as https://hcservices.ecourts.gov.in/hcservices/ Lead Society for 26 Link Societies and while taking over the Lead Society business for Thittakudi Taluk, Virudhachalam Agricultural Producers Co-operative Sales Society had submitted that it will run the business with the existing 11 employees available, taking into consideration that society had to pay a sum of Rs.264 Lakhs to the Central Co-operative Bank, Cuddalore and therefore, further financial burden will adversely affect the society. 4.4. It is also specifically admitted by the Registrar of Co- operative Societies that the District Collector, Cuddalore has permitted Virudhachalam Agricultural Producers Co-operative Sales Society to start full function as a Lead Society from 26.6.2008. 5. Therefore, from the counter affidavit of the Registrar of Co- operative Societies, it is clear that Virudhachalam Agricultural Producers Co-operative Sales Society, whose status as a Lead Society was taken away on 22.8.2002 and given to Chidamabaram Agricultural Producers Co-operative Marketing Society, has been restored Lead Society status fully from 26.6.2008. In fact, the said fact has been recorded in the judgment of a Division Bench of this Court in the writ appeal filed by the Tamil Nadu Co-operative Marketing Societies Employees Association (Virudhachalam Unit) in W.A.No.3925 of 2002. The Division Bench, by recording the retransfer of Lead Society status to the Virudhachalam Agricultural Producers Co-operative Sales Society, has passed the following order on 22.6.2010: "5. however, learned counsel for the appellant submitted that by virtue of the proceedings in Na.Ka.No.1-29152-08, dated 25.6.2008, the functions of the lead Society has been retransferred to fourth respondent – Virudhachalam Agricultural Producers Co- operative Marketing Society. The proceedings in Na.Ka.No.1-29152-08, dated 25.6.2008 reads as follows: "tpUj;jhryk; tl;lj;jpy; bray;gLk; epahatpiyf; filfspd; ,izg;g[r; r';f';fSf;F Kjd;ik r';fkhf bray;gl;L Efh;t[ gzpapid nkw;bfhz;l te;j rpjk;guk; ntshz;ik Tl;Lwt[ tpw;gid r';fj;jplkpUe;J ,g;gzp khw;wg;gl;L tpUj;jhryk; ntshz;ik cw;gj;jpahsh;fs; Tl;Lwt[ tpw;gidr; r';fk; Kjd;ik r';fkhf bray;gl ghh;it 1y; fhQqk; Mizapy; Tl;Lwt [ r';f';fspd; gjpthsh; Mizapl;Ls;shh;/ 2/ tpUj;jhryk; tl;lj;jpy; bray;gLk; epahatpiyf; filfSf;F tpUj;jhryk; ntshz;ik cw;gj;jpahsh;fs; Tl;Lwt[ tpw;gid r';fk; K:yk; 26/06/2006 Kjy; Efh;t[ bra;a[k; flY}h; jkpH;ehL Efh; bghUs; thzpg fHf KJepiy kz;ly nkyhsh; mDkjpf;f mDkjp tH';fp Mizaplg;gLfpwJ/" 6. In view of the above proceedings retransferring the lead Society to fourth respondent, the writ appeal is closed as nothing survives for consideration." https://hcservices.ecourts.gov.in/hcservices/ 6. In fact, that writ appeal judgment was consequent to the dismissal of the writ petition filed by the Tamil Nadu Co-operative Employees' Association (Virudhachalam Unit) against the action taken by the Registrar of Co-operative Societies dated 22.8.2002 cancelling the Lead Society status to Virudhachalam Agricultural Producers Co- operative Sales Society and transferring the same to Chidamabaram Agricultural Producers Co-operative Marketing Society. Ultimately, when the matter was decided in the writ appeal, the restoration of the Lead Society status to Virudhachalam Agricultural Producers Co- operative Sales Society with effect from 26.6.2008 has been confirmed and the same has been recorded in the Division Bench judgment. 7. Therefore, on fact, it is clear that from 2008 onwards the status of Virudhachalam Agricultural Producers Co-operative Sales Society as Lead Society has been restored and it is no more open to the said society to contend that it is either incurring financial loss or it is not having any business activity. It is true that financial loss may not be a ground for issuing notice under Section 25-F of the Industrial Disputes Act. Section 25-F of the Industrial Disputes Act simply states as follows: "Section: 25F. Conditions precedent to retrenchment of workmen.- No workman employed in any industry who has been in continuous service for not less than one year under an employer shall be retrenched by that employer until- (a) The workman has been given one month’s notice in writing indicating the reasons for retrenchment and the period of notice has expired, or the workman has been paid in lieu of such notice, wages for the period of the notice; (b) The workman has been paid, at the time of retrenchment, compensation which shall be equivalent to fifteen days’ average pay for every completed year of continuous service or any part thereof in excess of six months; and (c) Notice in the prescribed manner is served on the appropriate Government for such authority as may be specified by the appropriate Government by notification in the Official Gazette." 8. It is also relevant to point out at this stage that while admitting W.P.Nos.12312 to 12314, 12776, 13475 and 14077 of 2003, this Court has granted an order of interim stay on 22.4.2003, which was made absolute on 27.8.2003 and by virtue of the same, the petitioners in W.P.Nos.12312 to 12314, 12776, 13475 and 14077 of 2003 have been continuing in the employment in the Virudhachalam Agricultural Producers Co-operative Sales Society. It is also not in dispute that in respect of no one of the petitioners retrenchment compensation or any other compensation has been paid or settlement of https://hcservices.ecourts.gov.in/hcservices/ terminal benefits has been made in respect of the services rendered by them. 9. Mr.R.Subbiah, learned counsel appearing for Virudhachalam Agricultural Producers Co-operative Sales Society, on instructions, would submit that now the society has been restored the status of Lead Society and it can take up the petitioners by withdrawing the notices issued under Section 25-F of the Industrial Disputes Act. He would also submit that in respect of the writ petitioners in W.P.Nos.12312 to 12314, 12776, 13475 and 14077 of 2003, the period for which they have not worked salary may not be directed to be paid and for the period worked by them, by virtue of the interim order, they would be paid salary. In respect of the petitioners in W.P.Nos.18160 and 18161 of 2009, he would submit that since these two writ petitioners were ousted from service and the Joint Registrar has dismissed the revisions and review petitions filed by them, they would be reinstated, but without back-wages for the period they were not in service. 10. Considering the above said facts and circumstances of the case and taking note of the improved status of the Virudhachalam Agricultural Producers Co-operative Sales Society, these writ petitions are disposed with the following directions: (i) the impugned orders challenged in all the writ petitions stand set aside; (ii) the Virudhachalam Agricultural Producers Co- operative Sales Society, as submitted by its counsel, shall take back all the petitioners under its employment in the post which each of the petitioners were holding at the time of retrenchment and will be reemployed within a period of one week from the date of receipt of a copy of this order; (iii) those petitioners who have been given employment by Virudhachalam Agricultural Producers Co-operative Sales Society by virtue of the order of interim stay granted by this Court and who have actually worked shall be eligible for payment of salary for the said period; (iv) in respect of the petitioners who have not worked, they would be reemployed as per the order of this Court and shall not be eligible for salary on the basis of no work no pay, however, all the petitioners will be entitled to wages from the date of this order; (v) the petitioners in W.P.Nos.18160 and 18161 of 2009, who shall also be given reemployment within one week from the date of receipt of a copy of this order, shall be entitled to wages from the date of this order and shall not be entitled to wages from the date of notices issued under Section 25-F of the Industrial Disputes Act till the date of this order; and https://hcservices.ecourts.gov.in/hcservices/ (vi) the Virudhachalam Agricultural Producers Co- operative Sales Society shall confer all other service benefits to the petitioners which are available in law, including the continuity of service during the period of non employment of the petitioners. No costs. Consequently M.P.Nos.1 and 2 of 2009 in W.P.No.18160 of 2009 and M.P.Nos.1 and 2 of 2009 in W.P.No.18161 of 2009 are closed. Sd/ Asst.Registrar /true copy/ Sub Asst.Registrar sasi To: 1. The Registrar of Co-operative Societies Chennai – 600 010. 2. The Joint Registrar of Co-operative Societies Cuddalore Region, Cuddalore District. order in W.P.Nos.12312 to 12314, 12776, 13475 and 14077 of 2003 and 18160 and 18161 of 2009 BS (CO) RH (15.2.11) https://hcservices.ecourts.gov.in/hcservices/