# Th• Deccan M•rchants Cooperotiv• Bank Ud v. Mis. Dulicht.fld

- **Citation:** [1970] 1 S.C.R. 205
- **Court:** Supreme Court of India
- **Decided:** 1969-04-03
- **Case number:** Civil Appeals Nos. 2093 and 2094 of 1968
- **Bench:** J.M. Sm!LAT, Bhargava, C. A. Vaidialingam
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/th-deccan-m-rchants-cooperotiv-bank-ud-v-mis-dulicht-fld-4730
- **Pages:** 15

## Headnote

Andhra Pradesh Co-operative Societies Act (7 of 1964), s. 61 and
Industrial Disputes Act (14 of 1947), s. lO(l)(d)-Industrial disputeWhether could be referred to Registrar of Co-Operative Societies under
s. 61 of Andhra Act-Jurisdiction of Industrial Tribunal if barred-
'Touching the business of Society", meaning of-Scope of s. 16(5) of the
Andhra Act.
Disputes between some Cooperative Central Banks of Andhra Pradesh
and their employees, relating to : (i) service conditions such as salary
scales, dea:mess and other allowances, conveyance charges, working hours
and promotion, age of retirement, provident fund and gratuity, leave
rules, departmental ~nquiries, probation and confirmation; and (ill the
question whet~r t'ransfers of some employees were justified, were referred
to the Industrial Tribunal under s. IO(l)(d) of tbe .Industrial Disputes
Act, 1947.
On the question whether the Industrial Tribunal had no
jurisdiction to decide tbe disputes, because : (I) the disputes could be
referred to the Registrar of Cooperative Societies under s. 61 of the
· Andhra Pradesh Cooperative Societies Act, 1964; (2) the Registrar,
in
dealing with the disputes referred to him under s. 61 of the Andhra Act,
could grant relief by amending the bye-laws under s. 16(5); and (3)
If the Industrial Tribunal gave relief to the employees it would be
altering the. bye-laws thus making orders contrary to law.
HELD : (I) (a) The Andhra Act is an enactment passed by the
Slate Legislature and received the assent of the President.
Therefore. if
any provision of the Industrial Disputes' Act (a Central Act) is repugnant to any provision of the Andhra Act, the latter would prevail. But
s. 61 of the Andhra Act requires 'reference of a dispute_ to the Registrar
only if the dispute is capable df being resolved by him or his nominee,
and if the dispute between the
cooperative society and its
employee
touches the business of the society.
The \vord 'business' means actual
trading or commercial or other similar business activity of the society.
Therefore, whatever a society does o'r is required to do for the purpose
of carrying out its objects, such as laying down the conditions of service
of its employees, cannot be said to be a part of its 'business', and hence,
a dispute relating to conditiom1 of service of the workmen employed by
the society cannot be held to be a dispute touching the business of the
society. 1209 E-F: 215 B-D, G-Hl
(b) The Registrar could not have granted the reliefs claimed because
of the limitations placed on b.is powers by the Andhra Act. Most of the
Conditions of sel'V!ce which the workmen want to be altered to their benefit
have been laid down by the bye-laws, so that, any alteration in tbose conditions of service will requirn a change in the bye-laws. But such a change
could not possibly be directed by the Registrar, because, under s. 62( 4) ·
df the Andhra Act, the Registrar or other person or arbitrator to whom
the dispute may be referred under s. 61 is specifically required to decide
the. dispute referred to hirr1 in accordance with the provisions-of-1he byelaws. [216 B·D, FT
206
SUPREME COUllT REPORTS
[I970J I S.C.R
Th• Deccan M•rchants Cooperotiv• Bank Ud. v. Mis. Dulicht.fld
Jugraj Jain, [1969] 1 S.C.R. 887, followed.
South A.rcot Cooperalive M olor Transport Society Ltd. v. Syed Batcha,
[1960] II L.L.J. 693, approved,
(2) The provisions of s. I 6(5) of the Andhra Act are irrelevant in
comidering the scope of the jurisdiction of the Registrar uode'c s. 61 of
the Act, because : (a) any action taken by the Registrar under s. 16(5)
will not be a decision in a dispute referred lo him under s. 6 I; ( b) though
the Registrar has the power to amend bye-laws under " 16(5) any other
person or arbitrator, to whom the disputes may be referred, bas no such
power; and (c) even !be Registrar's powers under s. 16(5) to amend byelaws is to be exercised only if he is of the opinion that it would be in the
interests of the society and are not contempl

## Text

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CO-OPERATIVE CENTRAL BANK LTD. & ORS.
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ADDmONAL INDUSTRIAL TRIBUNAL, ANDllRA
PRADESH & ORS.
April 3, 1969
[J.M. Sm!LAT, V, BHARGAVA AND C. A. VAIDIALINGAM, JJ.j
Andhra Pradesh Co-operative Societies Act (7 of 1964), s. 61 and
Industrial Disputes Act (14 of 1947), s. lO(l)(d)-Industrial disputeWhether could be referred to Registrar of Co-Operative Societies under
s. 61 of Andhra Act-Jurisdiction of Industrial Tribunal if barred-
'Touching the business of Society", meaning of-Scope of s. 16(5) of the
Andhra Act.
Disputes between some Cooperative Central Banks of Andhra Pradesh
and their employees, relating to : (i) service conditions such as salary
scales, dea:mess and other allowances, conveyance charges, working hours
and promotion, age of retirement, provident fund and gratuity, leave
rules, departmental ~nquiries, probation and confirmation; and (ill the
question whet~r t'ransfers of some employees were justified, were referred
to the Industrial Tribunal under s. IO(l)(d) of tbe .Industrial Disputes
Act, 1947.
On the question whether the Industrial Tribunal had no
jurisdiction to decide tbe disputes, because : (I) the disputes could be
referred to the Registrar of Cooperative Societies under s. 61 of the
· Andhra Pradesh Cooperative Societies Act, 1964; (2) the Registrar,
in
dealing with the disputes referred to him under s. 61 of the Andhra Act,
could grant relief by amending the bye-laws under s. 16(5); and (3)
If the Industrial Tribunal gave relief to the employees it would be
altering the. bye-laws thus making orders contrary to law.
HELD : (I) (a) The Andhra Act is an enactment passed by the
Slate Legislature and received the assent of the President.
Therefore. if
any provision of the Industrial Disputes' Act (a Central Act) is repugnant to any provision of the Andhra Act, the latter would prevail. But
s. 61 of the Andhra Act requires 'reference of a dispute_ to the Registrar
only if the dispute is capable df being resolved by him or his nominee,
and if the dispute between the
cooperative society and its
employee
touches the business of the society.
The \vord 'business' means actual
trading or commercial or other similar business activity of the society.
Therefore, whatever a society does o'r is required to do for the purpose
of carrying out its objects, such as laying down the conditions of service
of its employees, cannot be said to be a part of its 'business', and hence,
a dispute relating to conditiom1 of service of the workmen employed by
the society cannot be held to be a dispute touching the business of the
society. 1209 E-F: 215 B-D, G-Hl
(b) The Registrar could not have granted the reliefs claimed because
of the limitations placed on b.is powers by the Andhra Act. Most of the
Conditions of sel'V!ce which the workmen want to be altered to their benefit
have been laid down by the bye-laws, so that, any alteration in tbose conditions of service will requirn a change in the bye-laws. But such a change
could not possibly be directed by the Registrar, because, under s. 62( 4) ·
df the Andhra Act, the Registrar or other person or arbitrator to whom
the dispute may be referred under s. 61 is specifically required to decide
the. dispute referred to hirr1 in accordance with the provisions-of-1he byelaws. [216 B·D, FT
206
SUPREME COUllT REPORTS
[I970J I S.C.R
Th• Deccan M•rchants Cooperotiv• Bank Ud. v. Mis. Dulicht.fld
Jugraj Jain, [1969] 1 S.C.R. 887, followed.
South A.rcot Cooperalive M olor Transport Society Ltd. v. Syed Batcha,
[1960] II L.L.J. 693, approved,
(2) The provisions of s. I 6(5) of the Andhra Act are irrelevant in
comidering the scope of the jurisdiction of the Registrar uode'c s. 61 of
the Act, because : (a) any action taken by the Registrar under s. 16(5)
will not be a decision in a dispute referred lo him under s. 6 I; ( b) though
the Registrar has the power to amend bye-laws under " 16(5) any other
person or arbitrator, to whom the disputes may be referred, bas no such
power; and (c) even !be Registrar's powers under s. 16(5) to amend byelaws is to be exercised only if he is of the opinion that it would be in the
interests of the society and are not contemplated to be exercised in the
interests of the workmen or for the purpose of resolving industrial disputa.
[219 B-EJ
(3) The principle that rules framed unller a statute have the force of
Statute does not apply to bye-laws of a cooperative society. They merely
govern the internaf management, business or adminiatratiOn of a aociety
aDd may be binding between the perJODS affected by them but arc DCither
law nor do they have the force of law.
They are just like conditiona of
seivice. laid down by contract between the parties, or like bye-laws under
tho Articles of Association of a company under the Companies Act, or
Stalll!ing Orders certified under the. Industrial Employment
(Standing
Ort!en)Act, 1946.
Therefore, the circumstance that in granting relief,
the Tribunal may have to vary the SJ'"!'ial bye-laws framed by the CooperatiVe Banks does not lead to the mference that the Tribunal would be
making orders contrary to law and therefore is incompentent to grant the
reliefs claimed.
The jurisdiction &fllnled to the Tribunal by the Industrial
Dispnt°' Act is not lhe jurisdiction of merely administering existing laws
and enforcing existing contracts. 1be Tribunal has the jurisdiction even
to va:ry contracts of service between employer and employees. Further,
in the Andhra Act there is no prohibition that the conditions of service
prescribed are not to be altered.
lbercforc, the reliefs could only be
gr&nled by the Industrial Tribunal and could not fall within the scope of.
the Registrar's powers under the Cooperative Societies Act. [217 H; 218
J).H]
Dalmia Cement (Bharc.t) Ud. v. Their Workmen, (1961) II
L.L.J.
130 (S.C.),The Management of Marina /lore/ v. Th• Workmen, [ 1962)
3 S.C.R. 1, Cinema Theatres v. The Workmen, [1964) II L.LJ. 128 and
The, Hindustan Times Ltd. v. Their Workmen,
[1964]
I
S.C.R. 234,
distinguished.
Since the competence of the reference to the Tribunal as a whole wa!i
challenged on the ground that it was barred by s. 61 of the Andhra Act,
the question whether a particular issue forming part of the reference was
competently referred or not did not arise. [219 F, G-H]
CIVIL APPELLATE JURISDICTION :
Civil Appeals Nos. 2093
and 2094 of 1968.
Appeals from the judgment and orcer dated August 5, 1968
of the Andhra Pradesh High Court in Writ Petitions Nos. 1339
and 2742 of 1968.
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C. B. Agarwala, K. Srinivasa Murthy, B. P. Singh and
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Nattnit Lal, for the appellants (in both the appeals).
A. S. R. Chari, M. K. Ramamurthi, S. Papp11, Madan Mohan,
•
CO-OP. BANK v. INDUST. TRIBUNAL (Bhargava, J.)
207
A /. Ramamurthi, Vineet Kumar, P. S. Khera and Bindra Thakur,
for respondent No. 2 (in both the appeals).
The Judgment of the Court was delivered by
Bbargava, 1. An industrial dispute arose between. 25 Cooperative Central Banks in the State of Andhra Pradesh and
B their workmen represented by the Andhra Pradesh Bal1k Employees Federation, Hyderabad, which was ref.erred by the Government of Andhra Pradesh to the Industrial 'I'ribunal, Hyderabad, under section lO(l)(d) of the Industrial Disputes Act
· No. 14 of 1947. The subject-matter of the dispute was divided
into three issues. The first issue comprised a number of service
C conditions, viz., (l} Salary, Scales and Adjustments, (2). l)earness Allowance, (3) Special Allowances, ( 4) other AlloWmices,
(5) Unifoi111$ and Washing Allowances for .·subordinate stafi,
(6) Conveyance Charges, (7) Provident Fund and Gratuity,
(8) Leave Rules, (9) Joining Time on Transfer,
(10) Rules
relating to departmental enquiry against employees for misconduct, (11) Probationary Period and Confirmation, (12) WorkD ing Hours and Overtinie Allowance, ( 13) Age of Retirement,
(14) Security, (15) Common Good Fund, (16) Service Conditions and ( 17) Promotions.
The second and the third i$$UeS
both related to the question whether the transfers of some em-.
plOyees of two of the Bariks, The Vijayawada Co-operative Central Bank, Ltd., Vijayawada, and The Vizianagaram Co-operatiVe
E Central Bank Ltd., Yizianagaram, were justified and, if not, to
what reliefs were the emplgyees entitled.
Before the Industrial
Tribunal, one of the 'grounds raised on behalf of the Banks was
that the reference of the .disputes to the Tribunal was invalid,
because such disputes were required to be referred for decision tc
the Registrar of the Co-operative Societies under section 61 of
F the Andhra Pradesh Co-operative Societies Act No. 7 of 1964
(hereinafter referred to as 'the Act'), and the effect of the provisions of the Act was to exclude the jurisdiction of the Industrial
Tribunals to deal with the same disputes under the Industrial DisputfS Act. Various other pleas were also taken by the Banks in
resisting the claims of the workmen, but, in these appeals, we
are not concerned with them, because the Tribunal dealt with
G the point, mentioned by us above, as a preliminary issue and rejected ·the contention of the Banks.. Twenty-four of the Banks
thereupon challenged the preliminary decision of the Tribunal on
this question, treatinj1; it as a preliminary award, by filing ·two
Writ Petitions Nos. 2339 and 2742 of 1968 under Art. 226 of
the Constitution in the High Court of Andhra Pradesh.
The
H High Court also rejected the plea of the Banks. These two.
appeals have been brought up before us by certificate aj1;ainst the
orders of the High Court dismissing the two writ petitions. In
Civil Appeal No. 2093/1968, the appellants are 10 Banks who
SUPREME COU&T llBPOllTS
[1970] 1 S.C.R.
wero petitioners before the High Court in Writ Petition No. 2339
of 1968, while 2 of the petitioner-Banks in that writ petition
have been implcaded as
respondents.
In Civil
Appeal
No. 2094 of 1968, the appellants are also 10 Banks who had
joined in filing the other Writ Pe.ti.lion No. 27~2/1968 i!1
th_e
High Court, while one of the petitioner-Banks m that Wiit F.lItion has been impleaded as respondent, and another has not JOIDcd the appeal as a party. In these appeals, therefore, we are only
concerned with one single question as to whether the jurisdiction
of the Industrial Tribunal to adjudicate on the industrial dispute
referred to it under s. 10(1) (d) of the Industrial Pisputes Act
was barred by the provisions of s. 61 of the Act.
The Tribunal, and the High Court, in rejecting the plea taken
on behalf of the Banks, expressed the view that the disputes
actually referred to the Tribunal were not capable of being decided by the Registrar of the Co-operative Societies under s. 61 of
the Act and, consequently, the reference to the Industrial Tribunal under the Industrial Disputes Act was competent. Learned
counsel appearing on behalf of the Banks took us through the
provisions of the Act to indicate that, besides being a local and
special Act, it is a self-contained Act enacted for the purpose of
successful working of Co-operative Societies, including Co-operative Banks, and there are provisions in the Act which clearly exclude the applicability of other laws if they happen to be in confilct with the provisions of the Act.
It is no doubt true that the
Act is an enactment passed by State Legislature which received
the assent of the President, so that, if any provision of a Central
Act, including the Industrial Disputes Act, is repugnant to any
provision of the Act, the provision of the Act will prevail and not
the provision of the Central Industrial Disputes Act.
The general proposition urged that the jurisdiction of the Industrial Tribunal under the Industrial Disputes Act will be barred if the disputts in question can be competently decided by the Registrar
<m<lcr s. 61 of the Act is, therefor~, correct and has to be accepted.
The question, however, that has to be examined is whether
the indu.;trial dispute referred to the Tribunal in the present
cases was such as was required to be referred to the Registrar and
to be decided by him under section 61 of the Act.
In order to properly appreciate the submissions which have
been made on behalf of the Banks by their counsel, it is necessary
to set out the provisions of sections 16, 61, 62 and 133 of the
Act which are as follows :-
"16. Amendment of bye-laws of a society :-(!)
No amendment of any bye-law of a society shall
be
valid unless such amendment has been registered under
this Act. Where such an amendment is not expressed
to come into operation on a particular day,
then, it
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209
shall come into force on the day on which it is registered.
( 2) Every proposal for such ame~dmen.t sha~I be
forwarded to the Registrar who shall, 1f he 1s satisfied
that the proposed amendment fulfils the C?nditions
specified fo sub-section· ( 1 ) of section 7, register the
amendment within a period of sixty days from the date
of receipt of such proposals :
Provided that the Government may, for sufficient
cause which shall be recorded in writing, extend the
said period for a further period of sixty days.
( 3) The Registrar shall forward to the society a
copy of the registered amendment together with a certificate signed and sealed by him, and such certifica.te
shall be conclusive evidence that the amendment has
been duly registered.
( 4) Where the Registrar is not so satisfied,
he
shall communicate . by registered post the order of refusal together with the reasons therefor, to the society
within the period specified in sub-section (2).
( 5) If in the opinion of the Registrar, an amendment of the bye-laws of a society is necessary .or desirable in the interest of such society or of the co-operative movement, he may, in the manner prescribed, call
upon the society, to make any amendment within such
time as he may specify. If the society fails to make
such an amendment within the time so specified the
Registrar may, after giving the society an opportunity
of making its representation, register such amendment
and forward to the society by registered post a copy
of the amendment together with a certificate signed by
him; such a certificate shall be conclusive evidence that
the amendment has been duly registered; and such an
amendment shall have the same effect as an amendment
of any bye-law made by the society.
61. Disputes which may be referred to the Registrar
( 1) Notwithstanding anything in any law for the
time being in force, if any dispute touching the constitution, management or the business of a society, other
than a dispute regarding disciplinary action taken by
the society or its committee against a paid employee of
the society, arises-
(a) among members, past members and
persons
claimmg through members, past members and
deceased members; or
210
(b)
(c)
SUPREME CQURT REPORTS
[ 1970] I S.C.R.
between a member, past member or person
claiming through a member, past member or
deceased member and the society, its commillee
or anv officer, agent or employee of the society;
or
between the society or its committee and any
past committee, any officer, agent or employee,
or any past officer, past agent or past employee
or the nominee, heir or legal representative of
any dereased officer, deceased
agent, or deceased employee of the society; or
(d) between the society and any other society;
such dispute shall be referred to the Registrar for decision.
Explanation :-For tlie
purposes
of this sub-
•ection a dispute shall include-
(i) a claim by a society for any debt or other
amount due to it from a member, past member
or the nominee, heir or legal representative of
a deceased member, whether such debt or other
amount be admitted or not;
(ii) a claim by a surety against the principal debtor
where the S<'Ciety has recovered from the surety
any amount in respect of any debt or other
amount due to it from the principal debtor as
a result of t~e default of the principal debtor
whether such debt or other amount due be admitted or not;
(iii) a claim by a society against a member,
past
member or the nominee, heir or legal representative of a deceased member for the delivery of
possession to the society of land or other immovable property resumed by it for breach of the
conditions of assignment or a!lotment of such
land or other immovable property.
(2) If any question arises whether a dispute referred to the Registrar under this section
is a dispute
touching the constitution, management or the business
of a society, such question shall be decided by the
Registrar.
(3) (a) Every dispute relating to,
or in connection
with, any election to a committee of a society
referred to in clause (a) of sub-section (3) .of
section 31, shall be referred for decision to a
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CO-OP. BANK v. INDUST. TRIBUNAL (Bhargava, !.)
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Subordinate Judge or where there is no Subordinate Judge, to the District Judge
having
jurisdiction over the place
where the main
office of the society is situated, whose decision
thereon shall be final.
(b) Every dispute relating to or in connection with
any election to a com~ittee. of ~uch class of
societies as may, by notification m the Andhra
Pradesh Gazette, be srecified by the Government in this behalf and referred to in clause
(b) of sub-section (3) of sec.lion 31, shall be
referred for decision to a District Munsiff having
jurisdiction over the place where the main office
of the
society is
situated, and his
decision
thereon shall be final.
( 4) Every dispute relating to, or in
connection
with, any election to a committee shall be referred
under sub-section ( 1) of sub-section ( 3) only after
the date of declaration of the result of such election.
62. Action to be taken by the Registrar on such reference :-·
( 1) The Registrar may, on receipt of the reference
of a dispute under section 61-
( a) elect to decide the dispute himself; or
(b) transfer it for disposal to any person who has
been invested by the Government with powers
in that behalf; or
( c) refer it for disposal to an arbitrator.
(2) Where the reference relates to any dispute involving immovable property, the
Registrar or such
person Oil' arbitrator, may order that any person be
joined as a party who has acquired any interest in such
property subsequent to the acquisition of interest there-·
in by a party to the reference and any decision that may
be passed on the reference by the Registrar, or the person or the arbitrator aforesaid, shall be binding on the
party so joined as if he were an original party to the
reference.
( 3) The Registrar may, by order for reasons to be
recorded therein, withdraw any reference transferred
under clause (b) of sub-section ( 1) or referred under
clause ( c) of that sub-section and may elect to decide
the dispute himself or transfer it to any other person
under cla.use (b) of sub-section (1) or.refer it to any
other arbitrator under clause ( c) of that sub-section.
212
SUPREME COUllT REPORTS
[1970] I s.c.R.
( 4) The Registrar, such
person
or
arbitrator
shall decide the dispute in accordance with the provisions of this Act and the rule; and bye-laws and such
decision shall, subject to the provisions of section 76,
be final.
Pending final decision on the dispute, the
Registrar, such person or arbitrator, as the case may be,
may make such interlocutory order; as he may deem
necessary in the interests of justice.
133. Act to override other laws :-The provisions of
this Act shall have effect notwithstanding anything in-·
consistent therewith contained in any other law."
Reliance was placed on the non-0bstante clause "Notwithstanding anything in any law for the time being in force" occurring in s. 61 of the Act which has the effect that a
dispute
covered by this section must necessarily be referred to the Registrar for decision, so that it cannot be referred to any other authority under any other law.
Further strength is sought in support
cf this proposition from the provisions of section 133 of the Act
which clearly lays down that the provisions of the Act have
overriding effect if there be any provision in any other .aw inconsistent with the provisions of the Act.
Then, it was argued
that the language of s. 61 of the Act is wide enough to cover the
disputes referred to the Tribunal in these cases, because the disputes are between co-operative. societies and their employees and
they touch the business of the ·co-operative societies. In support
of this submission, learned counsel referred u~ to a number of
decisions of various High Courts in which the scope of the provisions contained in s. 61 of the Act or of similar provisions in
other local enactments was considered.
Most of these decisions
were concerned with laying down the meaning of the expression
"touching the business of the society" so as to include within its
soope disputes of different nature between the co-operative societies and their employees. The cases which have been brought to
our notice are :
( 1) a decision of a learned single Judge of the Bombay High
Court in G.l.P. Railway Employees Co.operative Bank Ltd. v.
Bhikhaji Merwanji Karanjia-Employee( 1\, in which a similar
provision contained in s. 54 of the Bombay Co-operative Societies Act No. 7 of 1925 was interpreted;
(2) a decision in Sagar Motor Trunsport Karamchari Union,
Sagar v. Amar Kamgar Passenger Transport Company Co-operative Society, Sagar and Another(2 ), where the Madhya Pradesh
ffigh Court interpreted section 55 (2) of the Madhya Pradesh
<t) A.!.R. 1941 Born. 341.
(2) (1969) 18 lndian Factories and
Labour Reports. 27.
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CO-OP. BANK v. INDUST. TRIBUNAL (Bhargava, J.)
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Co-operative Societies Act, 1960 wh_ich requi!~d a
disp~te. r~
garding tenns of employment, working cond1t1011s and d1Sc1pli·
nary action taken by a society, arising between a society and its.
employees, to be decided by the Registrar or any Officer appoint·
ed hy him;
( 3) a decision of a Full Bench of the Madras High Court in
M. S. Madhva Rao and Others v. D. V. K. Surya Rao, Member of
the Pithapuram Co-operative Bank, Pithapuram and Others(1 )
in which section 51 of the Madras Co-operative Societies Act
No. 6 of 1932, which was verv similar to s. 61 of the Act, was
interpreted;'"and
·
( 4) a decision of a Full Bench of the Bombay High Court in
Farklmndali Nannhay v. Potdar (V.B.) ('), in which also s. 54
of the Bombay Co-operative Societies Ad No. 7 of 1925. crune
up for interpretation.
Learned counsel for the appeliants also brought to /our notice
a decision of a single Judge of the Calcutta High C6urt in Co·
operative Milk Societies Union, Ltd. v. State of West Bengal and'
others(•), whe_re a dispute as to wages, wage-scales aJllCi dearness
allowance was held not to be a dispute. within the meaning of that
word as defined in the Bengal Co-operative Societies Act, 1940,
and sought to distinguish it on the ground that the decision in
that case turned on the meaning specially given in that Act to the
word "dispute"
It appears to us that it is .not necessary to exrunine in detail
the reasons given by the High Courts in the above cited cases for
the interpretation placed by them on provisions similar to s. 61
of the Act in view of a very recent decision of this Court in
The Decean Merchants Co·Of?erative Bank Ltd. v. Messrs Dalfchand Jugraj & Others('). In that case, this Court had to inter·
pret section 91 of the Maharashtra Co-operative Societies Act,
1960 (Maharashtra Act 32 of 1961), the relevant provision of"
which is reproduced below :-
"91. (1) Notwithstanding anything
contained in
any other law for the time being in force, any dispute
touching the constitution, elections of the office bearen,
conduct of general meetings, management or businesll
of a society shall be referred by any of the parties to the
dispute, or by a federal society to which the society is
Rffiliated, or by a creditor of the society, to the Regist·
rar, if both the parties thereto are one· or other of the
following :-
(1) A.I.R. 1954 Mad. 103.
. (3) [1958) 2 L.L.J, 61.
(2) (1962) I L.L.J. SI.
(4) (1969) 1 S.C.R. 887.
(a)
SUPREME COURT REPORTS
[1970] I S.C.R.
a society, its committee, any past committee,
any past or present officer, any past or present
agent, any past or present servant or nominee,
heir or legal
representative of any
deceased
officer, deceased agent or deceased servant of
the society, or the Liquidator of the society;
-One of the questions which the Court formulated as requiring an
answer was : what is the meaning of the expression "touching
the business of the society"? In order to decide this question,
the Court analysed the provisions of s. 91(1) and held :-
"Five kinds of disputes are mentioned in sub-s. ( 1);
first, disputes touching the constitution of a
society;
secondly, disputes
touching election of the officebearers of a society; thirdly, disputes touching the conduct of general meetings of a society; fourthly, disputes
touching the management of a society; and fifthly, disputes touching the business of a society. It is clear that
the word 'business' in this context does not mean
affairs of a society because election of office-bearers,
conduct of general meetings and
management of
a
society would be treated as affair> of a society. In this
sub-section the word 'business' has been used
in a
narrower sense and it means the actual trading or commercial or other similar business activity of the society
which the society is authorised to enter into under the
Act and the Rules and its bye-laws."
1n that case, this Court was concerned with the question whether
a dispute touching the assets of a society was a dispute touching
the business of the society, and it was in that cont.ext that the
interpretation mentioned above was given by this
Court.
In
considering the full scope of s. 91 (I ) of the Maharashtra Act
32 of 1961, the Court further proceeded to hold :-
"While we agree that the nature of business which
a society does can be ascertained from the objects of
the society, it.is difficult to subscribe to the proposition
that whatever the society does or is necessarily required
to do for the purpose of carrying out its objects can be
said to be part of its business. We, however, agree that
the word 'touching' is very wide and would include
any matter which relates to or concerns the business of
a ~ociety, but we are doubtful whether the word
'affects' should also be used in defining the scope of the
word 'touching' ".
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CO-OP. BANK v. INDUST, TRIBUNAL (Bhargava, J.)
215
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This comment was made when taking notic~ of the decisio!l of
the Full Bench of the Bombay High Court m Farkhundalz v.
Potdar('). The Court also held : -
"One other limitation on .the word 'dispute' may
also be placed and that is
that the word
'disp~te'
covers only those disputes which are capable of bemg
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resolved by the Registrar or his nominee."
Considering the similarity betweens. 61 of the Act and. s: 91(1)
of the Maharashtra Act 32 of 1961, we are of the opm10n that
the interpretation already placed by t.'1is Court on the provisions
of s. 91(1) of th~ Maharashtra .Act 32 of 1~61 is .fully appli"
cable to the provisi.Qns of s. 61 of the Act with which we are
C
concerned.
Consequently, in deciding these appeals, we must
proceed on the basis that s. 61 of the Act requires reference of a
dispute to the Registrar only if the dispute is capable of being
resolved by the Registrar or his nominee, and, further, the dispute
between the co-operative society and the employee touches the
business of' 1f e society in the sense explained by this Court in
0
that case. ··,. .
Applying' these tests, we have no doubt at all that the dispute
covered by . the first issue referred to the Industrial Tribunal in
the present cases could not possibly be referred for decision to
the Registrar under s. 61 of the Act. The dispute related to alteration of a number of conditions of service of the workmen which
E
relief could only be granted by an Industrial Tribunal dealing
with an industrial dispute.
The Registrar, it is clear from the
provisions of the Act, could not possibly have granted the reliefs
claimed under this issue because of the limitations placed on his
powers in the Act itself.
It is true that s. 61 by itself does not
contain any clear indication that the Registrar cannot entertain
a dispute relating to alteration of conditions of service of the emF
ployees if a registered society; but the meaning given to the ex:
pression "touching the business of th~ society'', in our opinion,
makes it very doubtful whe.ther a dispute in respect of alteration
of conditions of service can be held to be covered by this expression. Since the word "business" is equated with the actual trading or commercial or other similar business activity of the sociefy,
G
and since it has been held that it would be difficult to subscribe
to the proportion that whatever the society does or is nocessarily
required to do for the purpose of carrying out its objects, such
as laying down the conditions of service of its employees, can be
said to be a part of its business, it would appear that a dispute
relating to conditions of service of the workmen employed by the
H
society canriot be held to be a dispute touching the business of
the society. Further, the position is clarified by the· provisions .
of sub-s. ( 4) of s. 62 of the Act which limit the power to be
U) [1962] P~LJc 51.
216
SUPREME COURT REPORTS
[1970] l s.c.R
exercised by the Registrar, when dealing with a d!sPute re~erred
to him under s. 61, by a mandate that he shall decide the dispute
in accordance with the provisions of the Act and the Rules and
bye-laws. On the face of it, the provisions of the Act, the rules
and the bye-Jaws could not possibly permit the Registrar to
change conditions of service of the workmen employed by the
society. For the purpose of bringing facts to our notice in the
present appeals, the Rules framed by the Andbra Pradesh Gov·
emment under the Act, and the bye-laws of one of the appellant
Banks have been placed on the Paper-books of the appeals before us.
It appears from them that the conditions of service of
the employees of the Bank have all .~en laid d~n by f.raming
special bye-laws.
Most of the cond!l1ons of semce, which the
workmen want to be altered to their benefit, have thus been laid
down by the bye-laws, so that any alteration in those conditiOllll
of service will necessarily require a change in the bye-laws. Such
a change could not possibly be directed by the Registrar when,
under s. 62 ( 4) of the Act, he is specifically required to decide
the dispute referred to him ·in accordance with the provisions o~
the bye-laws.
It may also be noticed that a dispute referred to
the Registrar under s. 61 of the Act can even be transferred for
disposal to a person who may have been invested by the Government with powers in that behalf, or may be referred for disposal
to an arbitrator by the Registrar.
Such
person or arbitrator,
when deciding the dispute, will also be governed by the mandate
in s. 62 ( 4) of the Act, so that he will also be bound to reject
the claim of the workmen which is nothing else than a request
for alteration of conditions of service contained in the bye-laws.
It is thus clear that, in respect of the dispute relating to alteration
of various conditions of service, the Registrar or other person
dealing with it under s. 62 of the Act is not competent to grant
the relief claimed by the workmen at all. On the principle Wd
down by this Court in the case ~f the Deccan Merchants Cooperative Bank Ltd. (1), therefore, it must be held that this dis·
pute is not a dispute covered by the provisions of s. 61 of the
Act. Such a dispute is not contemplated to be dealt with under
s. 62 of the Act and must, therefore, be held to be outside the
scope of section 61.
· In this connection, we may take notice of the view expressed
by a learned single Judge of the Madras High Court in South
Arcot Co-operative Motor Transport Society, Ltd. (for ex-servicemm) v. Syed Batcha and Others('), where dealing with an industrial claim, the learned Judge held :-
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"Therefore, in regard to an industrial claim like
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the retrenchment compensation, the
remedy fdr the
(I) [1969! I S.C.R. 887.
(2) (1960) ll L.L.J. 693.
';
.....
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GO-OP. BANK v. INDUST. TRIBUNAL (Bhargava, !.)
217
worker woμld be only to enforce it by the machinery
created by the Industrial Disputes Act, namely, by ss. 10
and 33C(2). The Madras Co-operative Societies Act
being itself a special statute, the authority, acting under
it, would have no jurisdiction beyond what the enactment itself conferred on him. He could not, therefore,
have jllkisdiction to decide a dispute under the Industrial Disputes Act."
That decision also related to s. 51 of the Madras Co-operative
Societies Act, 1932, which was similar in . terms to s. 61 of the
Act.
.
Learned counsel appearing on behalf of the appellant Banks,
however, urged a new point to challenge the jurisdiction of the
Industrial Tribunal to deal with the dispute relating to conditions
of service to the effect that ihe conditions of service having been
made the subject-m11tter of bye-laws, an Industrial Tribunal will
not be competent to alter them, because even an Industrial Tribunal has no jurisdiction to make orders contrary to law. For
this purpose, he referred us to a number of decisions of this Court
in Dalmia Cement (Bharat), Ltd., New Delhi v. Their Workmen and Another('); The Management of Marina Hotel v. The
Workmen('); Cinema Thratres v.
Their
Workmen(');
and
The Hindllltan Tim~s Ltd., New Delhi v.
Their Workmen &
Vice Versa('). In all these cases, it was held that an Industrial
Tribunal acted illegally in prescribing leave in excess of the number of days ll!id down by the Delhi Shops and Establishments
Act, 1954. In s. 22 of that Act there was a specific prohibition
that leave for sickness or casual leave with full wages shall not
exceed 12 days; and it was held that a direction made by the
Tribunal granting to the workmen more than 12 days' sickness
or casual leave was illegal. The principle of the decisions in
tho•.e cases does not, however, appear to us to be applicable to
the cases before us, because, in the present cases, there is no
prohibition contained in the Act that the conditions of service
prescribed are not to be altered. The argument on behalf of the
Bapk, however, was that the bye-laws, which contained the conditions of service, are themselves law, so that any direction made
by an Industrial Tribunal altering a condition of service contained in a bye-law would be an order contrary to law and, hence,
illegal.
We are unable to accept the submission that the bye-laws of
a co-operative society framed in pursuance of the provisions of
(I) [1961] ll L.L.J. 130
(3) [12641 ll L.L.J. 128.
L12Sup.CI/69--1$
(2) (1962) 3 S.C.R. I.
(4) [1964]I. S.C.R. 234.
218
SUPREME COURT REPORTS
[1970] l S.C.R.
the Act can be held w be law or to have the force of law.
It
has no doubt been helJ that, if a statute gives power to a Government or other authority to make rules, the rules so framed have
the force of statute anJ are to be deemed to be incorporated as
a part of the statute.
That principle, however, does not apply
to bye-laws of the nature that a co-operative society is empowered
by the Act to make. The bye-laws that are contemplated by the
Act can be merely those which govern the internal management,
business or administration of a society.
They may be binding
between the persons affected by them, but they do not have the
force of a statute.
lo respect of bye-laws laying down conditions of service of the employees of a society, the bye-laws would
be binding between the society and the employees just in
the
same manner as conditions of service laid down by contract between the parties.
In fact, after such bye-laws laying down
the
conditions of service arc made and any person enters the employment of a society, those conditions of service will have to
bti
treated as conditions accepted by the employee when entering
the service and will thus bind him like conditions of service specifically forming part of the contract of service. The bye-laws that
can be framed by a society under the Act are similar in nature to
the Articles of Association of a Company incorporated under the
Companies Act and such Articles of Association have never been
held to have the force of law.
In a number of cases, conditions
of service for indu,tncs arc laid down by Standing Orders certified under the Industrial Employment (Standing
Orders) Act,
1946, and it has been held that, though such Standing Orders
are binding between the emplo) crs and the employees of the industry governed by those Standing Orders, they do not have such
force of Jaw as to be binding on Industrial Tribunals adjudicating
an industrial dispute.
The jurisdiction which is granted to Industrial Tribunal> by the Industrial Disputes Act is not the jurisdiction of merely administ_ering the existing laws' and enforcing
existing contracls. ·Industrial Tribunals have the right even to
vary contracts of service between the employer and the employees
which jurisdiction can never be exercised by a civil court or
a Registrar acting under the Co-opera1ive Societies Act, so that
the circumstance that, in granting relief on issue No. 1, the Tribunal will have to vary the special bye-laws framed by the Cooperative Bank does not lead to the inference that the Tribunal
would be incompetent to grant the reliefs sought in this
reference. Jn fact, the reliefs could only be granted by the Industrial
Tribunal and could not fall within the scope of the powers of the
Registrar dealin_e with a dispute under s. 61 of the Act.
We may also, in tt.is connection, take notice of the submission
made by learned counscl tha• the Registrar could have granted
relief under s 16(5) of the Act if he thought that it was advis~
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\ CO-OP. BANK v. INDUST.·TRIBUNAL. (Bhargava, J.)
219
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-~-----· - .
A ' · able to grant that relief to the workIDen. . In our opinion, ili!S
submission must be rejected, for two. reasons. The first reason .is
that action taken by the Registrar under s. 16(5) of the Act Will
not be a decision on a dispute referred to him under s. 61 of the
Act. When dealing with the dispute under s. 61. of the A_ct, the
Registrar is bound to decide the dispute in accordance WJ!h the
B
existing bye-laws, so that, if the dispute relates to _altera:10n of
conditions of service laid down in the bye-laws, he will be mcompetent to grant the relief claimed. It is also to be noticed that
a dispute referred to a Registrar under s. 61 of the Act may be
transferred for disposal to a person who has been invested by the
Government with powers in that behalf, or may be referred for
~.
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disposal to an arbitrator. On· the face of it, such ]'.lerson or arbi-
.
. trator cannot possibly exercise the powers of the Registrar under' .
s. 16(5) of.the Act. The second reason is that, under s. 16(5}
of the Act, the power given to the Registrar to propose amendments in the bye-laws and to'enforce them if the proposal is not
accepted by a society is to be exercised only when the Registrar
is of the opinion that it is necessary or desirable to do so in the
0
interests of such society · or of the co-operative movement.
Amendments in bye-laws nnder s. 16(5) of the Act are not contemplated in the interests of the workmen or for the purpose of
resolving industrial disputes.
The provisions of s. 16(5} of the
Act thus appear to us to be irrelevant when considering the scope
· of the jurisdiction of the Registrar under s. 61 of the Act. ConseE
quent!y. the decision of the Hi~h Court holding that the Tnounal
had jurisdiction to deal with the industrial dispute referred to it
must be upheld.