Registered Cooperative Societies are not statutory bodies created by statute but are only body corporates, where the final authority vests in their general body and not in the Registrar Cooperative Societies, and consequently, they do not partake the character of 'State' under Article 12 of the Constitution of India.

Alok Sharma, J.

1. All these petitions raise a common question of law pertaining to the right of the petitioners all officers of the respondent Rajasthan State Cooperative Bank Ltd. (hereinafter 'the Bank') for payment of gratuity under Rule 7 of the Service Rules and Regulations, 1964 (hereinafter 'the Rules of 1964') @ 20 months pay last drawn on the date of their superannuation without the limit of Rs. 3.50 lakhs than extant under Section 4(3) of the Payment of Gratuity Act, 1972 (hereinafter 'the Act of 1972').

2. SBCWP No. 6343/2008, Lala Ram Sharma Vs. Rajasthan State Cooperative Bank Ltd. & Another, is taken as the lead case.

3. The petitioner when superannuated on 30-4-2007 after 38 years of service with the respondent Bank was a Senior Manager. His last gross salary i.e. Basic + DA was Rs. 28,114.14. The respondent Bank governed by the Rajasthan Cooperative Societies Act, 1965 now replaced as Rajasthan State Cooperative Societies Act, 2001 (hereinafter 'the Act of 2001') framed Service rules and Regulations, 1964 (hereinafter 'the Regulations of 1964') approved by the Board of Directors in its meeting dated 6-1-1964 to regulate the service conditions of its employees. Rule 7 of the Regulations of 1964 provides for payment of gratuity, and reads as under:-

Rule 7 Gratuity

(a) When a permanent employee who has rendered approved and meritorious service to the Bank ceases to be in its employment on account of death or retirement, the Board, at its discretion, may sanction payment of a gratuity to such an employee or his heirs, as the case may be provided:

(i) he has completed continuous service for a minimum period of ten years and

(ii) in case of death while in service he was in continuous service for not less than five years.

(b) Gratuity shall not be admissible in the case of any employee who is dismissed from service or who leaves, resigns or discontinues the service without written permission or whose services are terminated by the Bank as a disciplinary measure.

(c) The amount of gratuity payable shall be at the rate of one month's substantive salary last drawn, for each year of completed service, subject to a maximum of 20 months salary."

4. It was submitted that in view of bipartite settlements dated 14-5-1980, 7-8-1987 and 25-3-1997 between the respondent Bank and its officers' Association it was agreed that gratuity would be paid to the officers on their superannuation on the basis of salary last drawn by them at the rate of one month's salary for each completed year of service, subject to a maximum of twenty months salary. It was submitted that albeit the extant Section 4(3) of the Act of 1972 provided that amount of gratuity payable to an employee not exceed Rs. 3.50 lacs (Rupees three lacs fifty thousands) yet section 4(5) of the Act of 1972 as an exception thereto provided that nothing in section 4(3) aforesaid shall affect the right of an employee to receive better terms of gratuity under any award or agreement or contract with the employer. Therefore in view of Section 4(5) of the Act of 1972 the terms of Bipartite settlements aforesaid prevail over the limit for payment of gratuity as provided in Section 4(3) of the Act of 1972.

5. It has been submitted that the respondent Bank has however arbitrarily not acted in terms of the Bipartite settlements for payment of gratuity to the petitioner who has been paid only Rs. 3,50,000/-, while under the relevant bipartite settlements the petitioner was entitled to gratuity in an amount of Rs. 5,62,283/- i.e. computed on the basis of the last drawn salary of Rs. 28,114.14 (per month) (28,114.14 x 20) Hence it be directed that the balance of gratuity amount of Rs. 2,12,283/- be paid to the petitioner along with interest @ 24% from the date of his retirement 30-4-2007 till the date of payment. It has been submitted that arbitrary inaction of the respondent Bank is compounded by the fact that the case of the petitioner is squarely covered by the judgment of this court i