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2002 Supreme(Mad) 374

High Court of Judicature at Madras
The Honourable Mr. Justice V. Kanagaraj
The Management, T.P.Spl. 67 Goundanpalayam Primary Agricultural Cooperative Bank
Ltd., by its President Goundanpalayam Kanzeyam via Erode District
Versus
The Assistant Commissioner of Labour, The Authority under the Payment of Subsistence Allowance Act, Salem and another
W.P.No. 16028 of 1998
Decided On: 30-04-2002

Advocates Appeared
Mr.K.A.Ravindran, Advocate for Petitioner. Mr.M.Mahalingam, Govt. Advocate for Respondent No.l. Mr.K.V.Shanmuganatnan, Advocate for Respondent No.2.

The main legal point established is that the classification of the second respondent as an 'officer' under the Tamil Nadu Cooperative Societies Act, 1983 precludes his classification as an 'employee' entitled to subsistence allowance under the Payment of Subsistence Allowance Act, 1981.

Headnote:

Tamil Nadu Cooperative Societies Act - Employee - Act 43/81 - The court discussed the definitions of 'officer' and 'employee' under the Tamil Nadu Cooperative Societies Act, 1983 and the Tamil Nadu Payment of Subsistence Allowance Act, 1981. It concluded that the second respondent, being the Secretary of the petitioner Bank, falls under the definition of 'Officer' as per the Tamil Nadu Cooperative Societies Act, 1983 and is not classified as an 'employee' under the Payment of Subsistence Allowance Act, 1981.

Fact of the Case:

The petitioner, a cooperative society, sought to quash an order directing payment of subsistence allowance to the second respondent, who was suspended and later terminated from service. The petitioner argued that the second respondent, as the Secretary, falls under the definition of 'Officer' under the Tamil Nadu Cooperative Societies Act, 1983 and is not entitled to subsistence allowance as an 'employee' under the Payment of Subsistence Allowance Act, 1981.

Finding of the Court:

The court found that the second respondent, being the Secretary of the petitioner Bank, is classified as an 'officer' under the Tamil Nadu Cooperative Societies Act, 1983 and is not entitled to subsistence allowance as an 'employee' under the Payment of Subsistence Allowance Act, 1981.

Issues: The issues were whether the second respondent is an employee under the Payment of Subsistence Allowance Act, 1981 and what amount of subsistence allowance he is entitled to.

Ratio Decidendi: The court held that the second respondent, as the Secretary of the petitioner Bank, falls under the definition of 'Officer' as per the Tamil Nadu Cooperative Societies Act, 1983 and is not classified as an 'employee' under the Payment of Subsistence Allowance Act, 1981.

Final Decision: The writ petition succeeded, and the order directing payment of subsistence allowance was quashed.

Judgment :

1. Petition praying to issue a writ of certiorari calling for the entire records of the order passed by the first respondent herein in Payment of Subsistence Allowance Case Nos.4 of 1998 and 13 of 1998 dated 29.6.199 and quash the same.

2. In the affidavit filed in support of the writ petition, the petitioner Bank would submit that it is a Society registered under the Tamil Nadu Cooperative Societies Act, 1983 functioning as per the Tamil Nadu Cooperative Societies Act, 1983 and Rules 1988 and also its own bylaw; that there is a special bylaw relating to the service conditions of the employees; that the second respondent was employed as the Secretary in the petitioner Bank from 1.4.1973 to the date of his suspension on 27.6.1996, on a monthly salary of Rs.4,746; that the second respondent acted against the interest of the Bank and also lapses, misconduct and so many irregularities have been committed on his part, which resulted in suspending him from service on 27.6.1996 and after proper enquiry as contemplated under the Act and Rules, he was terminated from service on 1.12.1997; that the work performed by the second respondent was purely managerial in nature.

3. The petitioner would further submit that the second respondent is entitled to get only 25% of his salary as subsistence allowance during the period of suspension; that however, he had claimed payment of subsistence allowance as per the provisions of the Tamil Nadu Payment of Subsistence Allowance Act, 1981 (Act 43/81) and filed an application before the first respondent, who, on an erroneous appreciation of law and facts, passed an order directing the petitioner to pay a sum of Rs.51,771; that aggrieved, the petitioner has come forward to file the above application for the relief extracted supra.

4. No counter has been filed on the part of the respondents. However, the learned Government Advocate appearing on behalf of the first respondent and the learned counsel appearing on behalf of the second respondent would argue on instructions. The learned counsel for the petitioner would cite the definition Section 2(19) of the Tamil Nadu Co-operative Societies Act, 1983 which reads, "Officer" includes a president, vice-president, managing director, secretary, assistant secretary, member of board and any other person empowered under the rules or the by-laws to give directions in regard to the business of the registered society.

5. On the contrary, the learned counsel appearing on behalf of the second respondent would stick to the judgment delivered in C.Selvaraj v. Deputy Commr. of Labour, 1989 (1) L.L.N. 689 to the effect that the Tamil Nadu Payment of Subsistence Allowance Act, 1989 is applicable to him wherein it is held in the definition Section 2(a) - "employee" means, Supervisors of co-operative bank deputed to work as secretaries in various societies, such secretaries have no power to appoint, fix salary of any employee, sanction leave or take disciplinary action by themselves against the employees, their duties are not mainly managerial or administrative or supervisory and that they are employees under the Act and therefore entitled to subsistence allowance as per Tamil Nadu Act during the period of their suspension pending disciplinary proceedings against them.

6. Relying on this judgment, the first respondent simply stating that as per the definition Section 2(a) of the Tamil Nadu Payment of Subsistence Allowance Act, 1981, the second respondent is an employee and that even those who have supervisory or technical control, signing the loan amount applications or loan deposit applications or do their routine work in an establishment, and unless they are wielding powers such as effecting appointments, determining the salary or dismissing the servants, they would not come under the ambit of "employees" and since he is not able to arrive at such a conclusion that the second respondent did not appear to have withheld such powers of effecting appointments, d











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