Terminal benefits must be disbursed unless disciplinary proceedings were initiated prior to retirement; surcharge does not imply punishment.

ORDER

The petitioner has filed this writ petition challenging the order of the first respondent in Na.Ka.No.944/2020/nu dated 28.02.2020 and consequential letter of the second respondent dated 29.02.2020 and to direct the respondents to pay retirement benefits to the petitioner.

2. The petitioner who was the Secretary on the second respondent society had attained the age of superannuation and he was allowed to retire subject to the surcharge proceedings that might be taken against him. The grievance of the petitioner is that even after his retirement he was not settled with gratuity, provident fund and other retiral benefits for which he is entitle to.

3. Mr.S.Kamadevan, the learned counsel for the petitioner, submitted that as per Section 78 & 79 of the Tamil Nadu Co-operative Societies Act, the gratuity and provident fund cannot be withheld to an employee belonging to the Co-operative Society after his retirement; since the terminal benefits of the petitioner has been withheld, he has filed this writ petition seeking direction against the respondents.

4. Mr.S.Ravikumar, the learned Special Government Pleader, submitted that since the petitioner has been allowed to retire without prejudice to Section 82 of the Tamil Nadu Co-operative Societies Act (hereinafter referred to as “the Act”), he cannot seek disbursement of terminal benefits; while the petitioner was continuing the service no disciplinary action has been initiated against him.

5. There is no quarrel on the point that the petitioner has been allowed to retire from service on the condition that proceedings under Section 82 of the Act will be initiated against him; after an inspection has been conducted, surcharge proceedings have also been initiated under Section 87 of the Act and in which surcharge award has been passed on

07.07.2021.

6. The learned counsel for the petitioner submitted that the petitioner has filed an appeal over the above proceedings and the same is pending and in fact an order of interim stay has also been granted and it is in force. But the essential point that has to be dealt in this petition is that whether the respondent can withhold the retiral benefits of the petitioner in view of proceedings under Section 87 of the Act, that was going to be taken subsequent to his retirement.

7. As per the model special by-laws relating to the service conditions of the employees of II 533 Kavanoor Primary Agricultural Co-operative Societies in Chapter VI, Explanation IV, the following is stated with regard to the withholding of terminal benefits:

“ Explanation IV:

1. The discharge of a person appointed on probation before the expiry or at the end of the prescribed or extended period or probation or of a person engaged on contract in accordance with the terms of the contract on the expiry of the period of the appointment or of a person engaged on daily wages does not amount to removal or dismissal within the meaning of this special by law.

2. The disciplinary proceedings instituted against an employee, while he was in service, shall be deemed to be proceedings under this special by law, even after his retirement, and be continued and concluded by the competent authority in the same manner as if the employee had continued in service. In the even to any such disciplinary proceedings having been initiated and if the society has reason to believe that the disciplinary proceedings will result in the removal or dismissal of the employee from service, the society shall place the employee under suspension. The society also, shall not make payment of the terminal benefits like gratuity etc., payable to the employee until the disciplinary proceedings are finally concluded.”

8. Admittedly no disciplinary proceedings has been initiated against the petitioner at the time while he was in service. Until now no disciplinary proceedings have been initiated against the petitioner. No doubt a criminal case has been registered and the same is pending for investigation. But the technical p