The right to receive subsistence allowance under the Regulations framed under the Cooperative Societies Act cannot be denied based on the non-coverage under the Subsistence Allowance Act, 1981.

Heard Mr. M.S. Palaniswamy, learned counsel in support of this appeal; Mr. C.K. Chandrasekaran, learned counsel appearing for the first respondent and Mr. Raja Kalifulla, learned Government Pleader appearing for the second respondent.

2. The appellant herein is a co-operative bank, which is seeking to challenge the order passed by the learned single Judge, whereby the learned single Judge has allowed the writ petition filed by the first respondent herein, who was working as the Secretary in the Bank. He was suspended on 18th May, 2007. The writ petition was filed seeking for subsistence allowance during the period of suspension, which petition was allowed by the learned single Judge. Aggrieved against the said order, the bank has come forward with this appeal.

3. Mr. M.S. Palaniswamy, learned counsel, submits that payment of subsistence allowance is available only under the Tamil Nadu Payment of Subsistence Allowance Act, 1981 and it is available only to those who are employees, as covered under that Act and since, according to him, the first respondent herein was not an employee, he is not entitled to subsistence allowance. It is also submitted by Mr. Palaniswamy that the Cooperative Society is not an establishment.

4. To substantiate his contentions, learned counsel drew our attention to para-9 of the judgment in the case of I.I.558 Kuthiraichandal Primary Co-op. Bank Ltd. v. A. Asokan, reported in 2009 (1) MLJ 18. The relevant paragraph reads as follows:-

“A combined reading of Clause (a) and (c) of Section 2 of the Subsistence Allowance Act, shows that the provisions of the Act, will be applicable only in respect of employees employed in an Industrial Establishment and not otherwise. An employee of a Cooperative Bank is not entitled to the benefit of the subsistence allowance Act, as he is not an employee employed in, or in connection with any work or activities of the establishment to do any skilled or semi-skilled, etc., work and the Co-operative Bank also cannot be termed to be an establishment within the definition of Clause(c) of Section 2 of the Subsistence Allowance Act. Hence, the employee of a Co-operative bank is not entitled to payment of subsistence allowance as per the Subsistence Allowance Act. The term “employee” under the Subsistence Allowance Act, does not include “the Secretary” as well. Hence, the claim for payment of subsistence allowance by the Secretary of the Primary Agricultural Co-operative Bank, on the basis of payment of Subsistence Allowance Act, cannot be conceded.”

Mr. Palaniswamy, therefore, submits that the learned single Judge was in error in granting subsistence allowance. He also relies upon a judgment of a Division Bench in the case of Kanagasabapathy, M. v. The Special Officer, S-390, Pothanoor Primary Agricultural Cooperative Bank Ltd reported in 2007 (5) SCC 392 in this behalf.

5. Now, as can be seen, the subsistence allowance, which is claimed by the first respondent, is under G.O.Ms.No.55 dated 24th March, 2000 issued by the State Government under Section 151 of the Tamil Nadu Primary Agricultural Co-operative Bank Common Cadre Service Regulations, 2000. Under Clause 29(d)(1) of the said Regulations, an employee under suspension shall be entitled to subsistence allowance as per the payment of Subsistence Allowance Act, 1981. It is thus clear that this Regulation issued under the Cooperative Societies Act gives the right to a suspended employee to receive the subsistence allowance and the subsistence allowance will be as per the provisions of Subsistence Allowance Act, 1981. It means that the rate of subsistence allowance to be paid will be as per the provisions under that Act. The source of the authority for this regulation is not under the Subsistence Allowance Act, 1981, but under the Co-operative Societies Act.

6. In our view, the Division Bench in the case Kanagasabapathy, M. v. The Special Officer, S-390, Pothanoor Primary Agricultural Cooperative Bank Ltd (supra) w