2004 (7) TMI 693 - SC - Indian Laws

Authority of the State to direct regularization of services of cooperative society employees - Applicability of the 1981 Act to cooperative societies - Compliance with statutory rules for appointments - Validity of appointments made on compassionate grounds - HELD THAT - It is trite that appointments cannot be made on political considerations and in violation of the government directions for reduction of establishment expenditure or a prohibition on the filling up of vacant posts or creating new posts including regularization of daily-waged employees. Although we do not intend to express any opinion as to whether the cooperative society is a State within the meaning of Article 12 of the Constitution of India but it is beyond any cavil of doubt that the writ petition will be maintainable when the action of the cooperative society is violative of mandatory statutory provisions. In this case except the Nodal Centre functions and supervision of the cooperative society the State has no administrative control over its day to day affairs. The State has not created any post nor they could do so on their own. The State has not borne any part of the financial burden. It was therefore impermissible for the State to direct regularization of the services of the employees of the cooperative societies. Such an order cannot be upheld also on the ground that the employees allegedly served the cooperative societies for a long time. We are in the opinion that in a case of this nature where the validity or otherwise of a government order is in question the principles of natural justice will have no role to play and in any event recourse thereto would result in futility. It appears that the appellant was appointed as supervisor in 3rd respondent Bank by the President of the Bank on a consolidated pay of 2500/- by an order dated 5.03.2001. Her appointment is said to have been made on compassionate ground on the plea that her husband had deserted her. It has not been shown before us that there exists a scheme in terms whereof deserted woman can be appointed on compassionate grounds. Even such appointment in our opinion would be illegal. Thus we do not find any merit in these appeals which are dismissed accordingly.

Summary

Issues Involved:
1. Maintainability of the writ petitions.
2. Applicability of the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981, and the Industrial Disputes Act, 1947, to cooperative societies.
3. Validity of G.O.Ms. No. 86, dated 12.3.2001, regarding regularization of appointments.
4. Entitlement of illegal appointees to statutory protection of regularization and permanent status.
5. Protection under the Industrial Disputes Act, 1947, for personnel not covered by the previous issue.

Summary:

Issue 1: Maintainability of the writ petitions
The writ petitions were held to be maintainable.

Issue 2: Applicability of the 1981 Act and the Industrial Disputes Act, 1947
The court decided that the 1981 Act is applicable to the employees of the Cooperative Societies.

Issues 3, 4, and 5: Validity of G.O.Ms. No. 86, Regularization, and Protection under the Industrial Disputes Act
The Division Bench held that the provisions of the 1981 Act would not apply to appointments made in violation of statutory rules. The G.O.Ms. No. 86 dated 12.3.2001 only authorized regularization of employees recruited between 9.7.1980 and 11.3.2001, exempting the requirement to notify the Employment Exchange. However, it did not exempt other statutory conditions. The court further directed compliance with specific rules and procedures for recruitment and regularization, emphasizing that appointments violating statutory rules, including those made without requisite qualifications or beyond cadre strength, could not be regularized.

Additional Observations:
- The court emphasized that regularization is not a mode of recruitment and cannot cure appointments made in violation of statutory provisions.
- It was noted that appointments made on compassionate grounds without following due procedures are also illegal.
- The court rejected the plea for regularization based on long service, stating that sympathy cannot override statutory requirements.

Conclusion:
The appeals were dismissed, and the court upheld the High Court's decision, emphasizing strict adherence to statutory rules for appointments and regularization in cooperative societies.