IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) WEDNESDAY, THE TWENTY FOURTH DAY OF JUNE TWO THOUSAND AND NINE PRESENT THE HON'BLE MR JUSTICE NOOTY RAMAMOHANA RAO WRIT PETITION NO : 22273 of 2006 Between: P.S. Sastry, S/o. Sri P.V. Krishna Murthy, R/o. H.No. 22-39, R.K. Nagar, 1st Lane, Malkajgiri, Hyderabad - 500 047. ..... PETITIONER AND 1 A.P. State Cooperative Marketing Federation Limited, 5-9-58/B, 7th Floor, Parisram Bhavan, Basheerabagh, Hyderabad - 500 004, Rep by its Managing Director. 2 General Manager (G), A.P. State Cooperative Marketing Federabad Limited, 5-9-58/B, 7th Floor, Parisram Bhavan, Basheerabagh, Hyderabad - 500 004. .....RESPONDENTS Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Affidavit filed herein the High Court will be pleased to issue an order direction or writ particularly one in the nature of Writ of Mandamus or any other appropriate writ declaring the proceedings Rc.No. EF/87/97 dated 07-7-2006 in so far as continuing the disciplinary proceedings after retirement is illegal arbitrary and unjust (ii) declaring the action of the respondents with holding the terminal benefits is illegal, arbitrary, unjust and contrary to judgment of the Hon'ble Supreme Court in Bhagirathi Jena Vs. Board of Directors, O.S.F.C. and consequently direct the respondents to release the terminal benefits along with interest @ 12% and pass such other order or orders as the Hon'ble Court deems fit and proper in the circumstances of the case Counsel for the Petitioner:MR.G.VIDYASAGAR Counsel for the Respondent No.: MR.MPAPA REDDY The Court made the following : O R D E R: This writ petition has been instituted by a Senior Executive of the first respondent herein-Andhra Pradesh State Co-operative Marketing Federation Limited, (henceforth referred to as ‘Corporation.’) questioning the validity of the proceedings issued by the General Manager of the Corporation on 07.07.2006 pointing out that the writ petitioner is permitted to retire from the service of the Corporation on the afternoon of 31.07.2006, but, however, the payment of terminal benefits are subject to the outcome of the disciplinary proceedings, which are pending against him. The case of the writ petitioner is that he joined service of the Corporation as a Junior Executive in the year 1972 and attained his promotion as a Senior Executive later and that he has worked at various places during his long tenure of service with the Corporation and since his date of birth is 10.07.1948, he was permitted to retire on attaining the age of superannuation of 58 years on the afternoon of 31.07.2006 but, however, his terminal benefits, which become payable to him upon such retirement are with held, pending finalization of the disciplinary proceedings initiated against him. The writ petitioner challenges the competence and power of the first respondent Corporation to withhold his terminal benefits any longer, after he seized to be an employee of the said Corporation with effect from 01.08.2006. According to the writ petitioner, the relationship of Master and Servant can be brought to an end in many ways and one of the modes known to bring about such a cessation of relationship is by way of retirement on attaining the age of superannuation. Therefore, according to the learned counsel for the petitioner, the relationship between the writ petitioner and the first respondent Corporation comes to an end, on and from 01.08.2006. The terminal benefits, which become payable upon termination of such relationship can be withheld only if there is a specific provision available in that regard in the special bye-laws and service regulations of the Corporation. The special bye-laws of the Corporation do not contain any such provision at the relevant point of time and hence, his terminal benefits ought not to have been held back by the Corporation. The learned counsel places reliance upon the judgment rendered by a Division Bench of this Court in a batch of Writ Appeals bearing W.A.Nos.260, 263 & 386 of 2005 rendered on 14.03.2006 wherein this very question has been answered by the Division Bench, holding that in the absence of a specific provision in the service regulations, the terminal benefits payable to an employee of the Corporation cannot be withheld. It was incidentally pointed out that the first respondent Corporation herein is the appellant in those batch of cases and hence, the judgment rendered by the Division Bench in the aforesaid cases binds the respondent Corporation and consequently, the respondent Corporation ought to have released the terminal benefits payable to the writ petitioner instead of withholding them. I have heard Sri G.Vidyasagar, learned counsel for the writ petitioner and Sri M.Papa Reddy, the learned Standing Counsel for the Corporation. The learned Standing Counsel in opposition submits that while it is true that a Division Bench of this Court has passed orders on 14.03.2006 in W.A.Nos.260, 263 & 386 of 2005 holding that the respondent Corporation cannot withhold the terminal benefits payable to the retired servants in the absence of any power available under the regulations to continue the disciplinary proceedings beyond the date of retirement, the Corporation has amended its service regulations by incorporating new regulation No. 79-6-0 under Chapter VIII of Conduct, Discipline and Appeal Rules of the Corporation, at its meeting held on 11.01.2005 and hence, the case of the writ petitioner stands on a different footing and in view of the amended staff regulations, the disciplinary proceedings can be continued even after the cessation of the relationship of the employer and employee. It will be important to notice at this stage two provisions contained in the Andhra Pradesh Co-operative Societies Act, 1964. One is Section 16, which deals with amendment of bye-laws of a Society. While Section 116 (C) dealt with staffing pattern of the Societies. Section 16 of the Co-operative Societies Act specifically made it clear that no amendment of any bye-law of a society shall be valid unless the resolution for such amendment is passed at its General meeting by a majority of not less than two-thirds of the members present and voting and such amendment has been registered under this Act. Every proposal for such amendment shall be forwarded to the Registrar who shall, if he is satisfied that the proposed amendment fulfils the conditions specified in sub-section (1) of Section 7, register the amendment within a period of thirty days from the date of receipt of such proposal. Thus, it is abundantly clear that an amendment to the by-laws as proposed by a Society will not become effective until and unless the same are registered by the Registrar of the Co-operative Societies under sub-section 2 of Section 16 of the Co-operative Societies Act. In the instant case, the proposed amendment by incorporating the following in the bye-laws of the Society dealing with Conduct, Discipline and Appeal Rules has been registered by the Registrar of the Co-operative Societies only on 16.12.2006. The amendment as registered by the Registrar of the Co-operative Societies reads as under: “In the event of employee reaching superannuation before the completion of the disciplinary case pending against him, Markfed will have a right to proceed to superannuate him but the terminal benefits of such an employee shall be settled subject to final orders in the disciplinary case and the relationship of employer and employee shall however continue for the limited purpose of such disciplinary case only.” After the Registrar has communicated his decision on 16.12.2006 registering the proposed amendment of the bye-laws, the first respondent Corporation appears to have adopted the same at its meeting held on 30.12.2006. It is manifestly clear that the amended bye- law incorporated by the first respondent Corporation came into force on 30.12.2006. Therefore, it will have prospective application. In other words, in cases of all such employees of the Corporation, who retire from service of the Corporation on or after 30.12.2006, the disciplinary proceedings, which are pending prior to their retirement can be continued even beyond their date of retirement, as was already noticed supra. In the instant case, the writ petitioner has attained the age of superannuation of 58 years as on 10.07.2006 and accordingly, he has been permitted to retire on the afternoon of the last working day of the said month. Thus, he retired from service of the Corporation on 31.07.2006 by which date there is no provision available in the service bye-laws of the Corporation enabling the Corporation to continue the disciplinary proceedings beyond the date of retirement. Hence, he can not amenable for the disciplinary control of the Corporation on and from 01.08.2006. In these set of circumstances, I hold that the respondent Corporation is not justified in withholding the payment of terminal benefits payable to the petitioner upon his retirement from the service of the Corporation. Accordingly, the writ petition is allowed directing the first respondent Corporation to settle the terminal benefits payable to the writ petitioner as expeditiously as possible, within a maximum period of three months from today. No costs. ___________________________ NOOTY RAMAHOMAHANA RAO J., Dt.24.06.2009 tjs