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Judgment
Nirmal Singh, J.—The controversy raised in these petitions is as to whether the employees working in the Cooperative Banks/Societies are
to retire at the age of 60 years or 58 years as per SRO 233 of 1988.
Learned Counsel for the petitioners submit that SRO 233 of 1988 dated 8th July'88, was issued by the Government in exercise of powers
conferred by Section 124 of the Jammu and Kashmir Cooperative Societies Act, 1960, which Act stands repealed by the Jammu and Kashmir
Cooperative Societies Act, 1989 (hereinafter referred to as the Act). It is contended that under the new Act, the Jammu and Kashmir Cooperative
Societies Rules, 2001 (here-in-after referred to as the Rules) have been formulated. As per Rule 2(e) of the Rules, a Society may make bye-laws
for the following matters:
2(e): - the method of recruitment, the conditions of service and the authority competent to fix, revise or regulate the scales of pay and allowance of
paid officers and employees of the society and the procedure to be followed in the disposal of disciplinary Cases against them.
It is submitted that under the aforesaid rule, the Cooperative Societies/Banks have framed the bye-laws governing the service conditions of their
employees and as per the said bye-laws have fixed the age of retirement as 60 years. It is thus submitted that the petitioners in terms of the said
condition laid down in the bye-laws are to retire at the age of 60 and not at the age of 58.
Objections have been filed by respondents stating therein that the controversy raised in the present petitions stands already decided by this
Court in the case reported as 2000 SLJ 117 Ved Paul Sharma v. Citizen's Cooperative Bank and Ors. and 2003 KLJ 26 Bachan Dass and Ors.
v. State and Ors. and therefore, the present writ petitions are not maintainable. It is stated that the bye-laws framed by the Societies/Banks run
counter to the rules framed by the Government under SRO 233, referred to above. It is stated that the J&K Cooperative Societies Act, 1960, has
been repealed by the Act of 1989 (SRO 538 dt. 3.12.1999) which came into force w.e.f. 5th of Dec'99 and the said enactment saves all the
statutory orders including SRO 233, and therefore, the service conditions of the employees of all the Societies registered under the Cooperatives
Societies Act, would be deemed to have been governed by the aforesaid SRO. It is thus stated that as some Cooperative Societies/Banks have
framed the bye-laws fixing the retirement age of the employees as 60 years and as the said condition as indicated above, runs counter to the
Statute framed by the Government, therefore, the order impugned has been issued to bring all the Banking institutions/Societies in conformity with
the provisions of SRO 233.
It is thus contended that the petitioner cannot be directed to be superannuated at the age of 60 years as the age of superannuation has been
fixed as 58 years as per SRO 233 and any bye-law framed by the Cooperative Societies/Banks which runs counter to the said SRO cannot be
given effect to.
Heard Learned Counsel for the parties, Admitted.
u/s 176(1) of the Act, the Government has the power to make rules for whole or any part of the State and for any class of Cooperative
Societies after previous publication to carry out the purposes of this Act. Under Clause 2(XV) of the said Section, the State Government can
frame the service conditions of the employees of the Cooperative Societies of the State regarding qualification, remuneration, allowances,
recruitment and other conditions of service. The said provisions read as under:
Power to make rules:
(1) The Government may for the whole or any part of the State and for any class of cooperative societies after previous publication, make rules to
carry out the purposes of this Act.
(2) In particular, and without prejudice to the generality of the foregoing powers, such rules may provide for all or any of the following matters,
namely:
xxxx
xxxx
(xv) the qualification, remuneration, allowances, recruitment and other conditions of service of such officers and other employees of cooperative
societies.
u/s 172 of the Act, a Cooperative Society registered under the Cooperative Societies Act, 1960, shall be deemed to be registered under the
Act and its bye-laws so far as the same are not inconsistent with the express provisions of the Act, continue in force until altered or rescinded. The
said provision reads as under:
172(1): Any Co-operative Society now existing which has been registered under the Cooperative Societies Act, 1960, shall be deemed to be
registered under this Act, and its bye-laws shall so far as the same are not inconsistent with the express provisions of the Act, continue in force until
altered or rescinded.
The Government has formulated the Rules of 2001 by issuing SRO 404 dt. 20th of Sept'01. Under these rules, the power has been given to the
Cooperative Societies to frame bye-laws. Under Clause 2(e) of Rule 5 of the said Rules, a Society may make bye-laws for the following matters,
namely:
2(e): the method of recruitment, the conditions of service and the authority competent to fix, revise or regulate the scales of pay and allowance of
paid officers and employees of the society and the procedure to be followed in the disposal of disciplinary cases against them.
After deriving this power, the Cooperative Societies/Banks have framed their bye-laws and the age of retirement under these bye-laws has
been fixed as 60 years.
In terms of SRO 233 of 1988, which as per the respondents is stated to be applicable in the present case, the age of retirement of the
employees of the Cooperative Societies/Banks has been fixed at 58 years. But as per the bye-laws framed by the Societies/Banks, the age of
retirement, as noticed above, has been fixed as 60 years. These bye-laws formulated by the Societies/Banks are inconsistent with the provisions of
SRO 233. The Bye laws can be given effect to if these are registered under the Act but admittedly, these have not been registered under the Act
and therefore, any amendment made in these bye-laws shall not be valid as provided u/s 9(1) of the Act, which reads as under:
9(1): No amendment of any bye-laws of a Cooperative Society shall be valid unless such amendment has been registered under this Act.
Therefore, when the bye-laws framed by the Cooperative Societies/Banks are not registered under the Act and run counter to the Statute,
these can be termed as inconsistent and cannot be directed to be applicable regarding governing of the service conditions so far as age of
retirement is concerned. The age of retirement of the employees of the Societies/Banks as per the provisions of SRO 233 of 1988 has been fixed
as 58 years. Therefore, the authority concerned has rightly passed the order impugned to bring all the Banking Institutions/Societies in conformity
with the provisions of the aforesaid SRO, which would be applicable in the present case as the bye-laws framed by the Societies have not been
registered under the Act.
Somewhat similar nature of controversy was decided by this Court in the case reported as Ved Paul Sharma v. Citizen Cooperative Bank Ltd.
2000 SLJ 117. In the aforesaid case, the provisions of SRO 233 of 1988 were held applicable to the employees of Cooperative Banks. Para 17
of the judgment, in so far as relevant is being reproduced below:
In view of the above factual and legal position, it can safely be concluded that the appellant's case is to be dealt with in term of SRO 233,
therefore, it is held:
(i) that the appellant is governed by the service conditions as enumerated in SRO 233 i.e. the Rules of 1988....
In the present case, as indicated above, the Cooperative Societies/Banks have framed their bye-laws in terms of the Rules aforementioned.
Under Clause 2(b) of the Act, the term bye-laws' has been defined as under:
2(b) Bye-laws"" means the bye-laws for the time being in force which have been registered under this Act and includes amendments thereto which
have been duly registered under this Act.
The bye-laws framed by the Cooperative Societies, as indicated above, have not been registered under the Act and run counter to the Rules
framed by the Government as under the bye-laws the retirement age of the employees of the said Societies/Banks has been fixed as 60 years
instead of 58 years as provided under the Statute. Therefore, the said Bye-laws, as indicated above, cannot be given effect to as has been held by
this Court in the case of Bachan Dass's case (supra), in which case, reliance was placed on the judgment passed by the Division Bench of this
Court in Ved Paul's case, referred to above. This Court in Bachan Dass's case, observed as under:
The bye-laws provide a method and manner in which the affairs of a Society or an Association or a Corporation or the like is to govern the internal
governance. If these bye-laws run counter to the statute, then these cannot be given effect to.... The Bye laws framed under the Act have to be
consistent with the Act and these must be published in accordance with the law. See Raza Buland Sugar Co. Ltd. Vs. Municipal Board, Rampur,
Ultimately in para 20 of the judgment in the aforesaid case, it was observed as under:
In view of the above, to say that SRO 233 which applies to Banking Cooperative Societies would not govern the age of retirement of the
employees is an argument which cannot be accepted. Once the Division Bench in the aforesaid case expressed an opinion that SRO 233 is
applicable to the Banking Cooperative Societies, then that decision is binding on me.... Thus the argument put across that the age of retirement as
fixed in the rules or bye laws framed by the Cooperative Societies fixing the age of retirement as 60 years should prevail and not me age of 58
years as fixed in SRO 233 is an argument which cannot be accepted....
As a matter of fact, this Court in a case reported as 1998 KLJ 83 had considered the matter regarding applicability of SRO 233 to the
employees of the Cooperative Societies/Banks and held that the service conditions of the employees of the respondent Bank are governed by the
rules framed under SRO 233. Against the judgment in the aforesaid case, a SLP was preferred before the Apex Court bearing No. 17997/98.
The said SLP, however, was dismissed and the judgment in the aforesaid case was upheld.
In view of the above, it can safely be held that the service conditions of the employees of the Cooperative Societies/Banks including the age of
retirement would be governed by SRO 233 referred to above and not in terms of the bye-laws framed by the said Societies/Banks as these run
counter to the Statute. The respondent-Registrar Cooperative Societies, in exercise of powers vested in him u/s 10(1) Act, thus, has rightly issued
the order impugned prescribing the age of retirement of the employees of the Societies/Banks as 58 and this has been done in conformity with the
provisions of the aforesaid SRO.
For the reasons mentioned above, these petitions are found to be without merit and are dismissed.