Non-payment of pension contributions by a cooperative society, despite sufficient funds, can result in penal actions against its officials as per regulatory circulars.

The writ petition is filed seeking action against respondents 6 and 7 in the light of Ext.P6 Circular No.44/2012 of the Registrar of the Co-operative Societies and a direction against them to pay an amount of ₹ 1,15,929/-(employer’s contribution of pension) with interest.

2. The petitioner was an employee of the 5th respondent Society. He retired from the services in June, 2017. After retirement his pension was not disbursed. On enquiry it was understood that pension could not be processed as the 5th respondent-employer had defaulted payment of contribution of an amount of ₹ 1,15,929/-. Since the 5th respondent failed to remit the amount in spite of requests in the said regard, to enable payment of pension, the petitioner on 24.10.2017 W.P.(C) No.30082 of 2019 remitted the employer’s outstanding contribution of ₹ 1,15,929/-. In spite of repeated requests, the 5th respondent failed to pay the said amount to the petitioner.

3. Left with no other alternative, the petitioner filed Ext.P3 complaint before the Joint Registrar. The Joint Registrar passed Ext.P4 order dated 12.09.2018 wherein it was noticed that, the Society, instead of paying the contribution amount of ₹ 1,15,929/- payable to the petitioner, an amount of ₹ 3,54,611/- being the profit for the year 2016-17 was transferred to the building fund. As per Ext.P4, the Assistant Registrar cautioned the sixth respondent with regard to the coercive measures provided for under Circular No.44/12 and directed payment of the amount to the petitioner.

Inspite of Ext.P4 order by the Assistant Registrar since no steps were taken by respondents 5 to 7 for payment of the amount to the petitioner, the petitioner filed W.P.(C) No.30082 of 2019 Ext.P7 complaint before the Registrar of Co-operative Societies. On the directions of this Court in Ext.P8 judgment in WP(C) No.9145/2019 at the instance of the petitioner, the complaint of the petitioner was considered and Ext.P9 order was passed by the third respondent. However, Ext.P9 only directed the Managing Committee to take steps for payment of the amount to the petitioner. It is aggrieved thereby that the petitioner has approached this Court.

4. I have heard learned counsel on either side.

5. The fact that the 5th respondent Society failed to remit the Employer's Contribution of ₹ 1,15,929/- and that the petitioner was constrained to pay the same is not in dispute. The contention of respondents 5 to 7 is that the Society is not possessed of sufficient funds to reimburse the petitioner.

6. In Ext.P4 order dated 12.09.2018 the Assistant Registrar has noted that though the amount payable to W.P.(C) No.30082 of 2019 the petitioner was only ₹ 1,15,929/- and as per the Audit Report 2016-17 the Society had a profit of ₹ 3,54,611/-, without paying off the liability the said amount was transferred to building fund. The direction in Ext.P4 to pay the amount to the petitioner was not complied with even in spite of Ext.P9 order of the Joint Registrar.

7. Exts.P4 and P9 orders referred to Circular No.44/2012 dated 19.11.2012 issued by the Registrar of Co-operative Societies, a copy of the Circular has been produced as Ext.P6. Clause-3 of the Circular reads thus:-

(3) tað {]-Im-cw s]³-j³ tIm¬-{Sn-_q-j³ b-Ym-ka- “ bw k-lI-c-W s]³-j³ t_mÀ-Unð A-S-hm-¡p-ó-Xnð hogv-N h-cp-¯p-ó ]-£w B-b-Xn-\v D-¯-c-hm-Zn-Ifm-b kw-Lw No-^v F-Iv-kn-Iyq-«o-hv/`-c-W-k-an-Xn Aw-K-§Ä F-ónh-sc A-tbm-Ky-cm-¡n A-h-cp-sS tað hy-àn-]-c-am- bn ]n-g Np-a-¯p-ó-XmWv.”

W.P.(C) No.30082 of 2019 It provides for disqualification of the Chief Executive and the Managing Committee members. It also provides for imposing of penalty on them for non-payment of pension contribution in time.

8. Though the 5th respondent had filed appeal against Ext.P9 order before the Government in terms of Section 83 of the Co-operative Societies Act , it is reported that the same was dismissed as per order dated 14.08.2023. The amount remains unpaid. In the circumstances, there is no reason why action shou