Disposed

The Malappuram District Co-Op. Bank Ltd. v. the Kondotty Producers-Cum-Consumers Agr

Kerala HC10 Jul 2009WA/158/2007

Case brief

AI extract

What is this about?

This judgment disposed of writ appeals regarding the closure of ration depots by a Co-operative Society. The Court held that granting new licenses to former employees does not exempt the Society from paying terminal benefits. However, considering the Society's heavy debts, the Registrar was authorized to devise modalities, including property sale, for pro-rata distribution of proceeds to claimants

What did the court decide?

The Joint Registrar is directed to proceed with steps for payment of dues to respondents by sale of property or other appropriate steps, ensuring pro-rata distribution if the Society is wound up.

The Malappuram District Co-Op. Bank Ltd. Vs the… — Company and Corporate | Kerala HC (2009)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT :

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THE HONOURABLE MR. JUSTICE K.BALAKRISHNAN NAIR &

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THE HONOURABLE MR. JUSTICE C.T.RAVIKUMAR

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FRIDAY, THE 10TH JULY 2009 / 19TH ASHADHA 1931

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WA.No. 158 of 2007()

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AGAINST THE JUDGMENT IN W.P.C.NO.9653/2006 DATED 21.11.2006.

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APPELLANT: 10TH RESPONDENT:

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THE MALAPPURAM DISTRICT CO-OPERATIVE BANK LTD., HEAD OFFICE MALAPPURAM, REPRESENTED BY

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ITS GENERAL MANAGER-IN-CHARGE.

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BY ADV. SRI.GEORGE POONTHOTTAM

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RESPONDENTS: PETITIONER & RESPONDENTS 1-9:

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THE KONDOTTY PRODUCERS-CUM-CONSUMERS AGRICULTURAL MARKETING & PROCESSING CO-OPERATIVE SOCIETY LTD., NO.F.1188, KONDOTTY-673 638, MALAPPURAM DISTRICT, REP. BY ITS SECRETARY.

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STATE OF KERALA, REPRESENTED BY ADDL.SECRETARY TO GOVERMENT, CO-OPERATIVE (C) DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM.

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THE REGISTRAR OF CO-OPERATIVE SOCIETIES, THIRUVANANTHAPURAM.

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THE JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL), MALAPPURAM.

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M. VELUKUTTY, S/O. KUNDAN, MADATHIL HOUSE, ELAYOOR, MALAPPURAM DISTRICT.

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T. ALI, S/O.KUNHAYINKUTTY, THODUKARA HOUSE, PUTHALAM, AREACODE, MALAPPURAM DISTRICT.

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P. AYAMMU, S/O. MAMMAD HAJI, CHELAKKODE HOUSE, OORANGATTIRI, MALAPPURAM DISTRICT.

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P.K. ABDUL LATHEEF, S/O. MAMMAD, KAKKUZHIKUNNATH HOUSE, KUNIYIL KEEZHUPARAMBU, MALAPPURAM DISTRICT.

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T. ABU, S/O.KUNHAYINKUTTY, THUNHIYIL HOUSE, PUTHALAM,

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AREACODE, MALAPPURAM DISTRICT.

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P. ALIKUTTY, S/O. AYAMMU, CHELAKKODE HOUSE, OORANGATTIRI, MALAPPURAM DISTRICT.

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*ADDITIONAL RESPONDENTS 11 TO 14

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MOHAMMED YOUSUF, S/O KONHUMUTTY, CHEKUMARAKARKATH (H), NEDIYIRUPPU, KONDOTTY P.O, MALAPPURAM.

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B. ABDUL RASHEED, S/O K. KAMMED HAJEE NADUTHODI(H), MORAYUR P.O, MALAPPURAM.

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BEERANKUTTY K., S/O KUNHI AHAMMED, KUTTAKUNNAN (H), KODANGAD P.O., KONDOTTY, MALAPPURAM

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PRABHAKARAN, S/O CHINAN, THEKKINTHODIL HOUSE, P.O KONDOTTY, MALAPPURAM.

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*(ARE IMPLEADED AS ADDITIONAL R11 TO R14 AS PER ORDER DATED 03.04.07 IN I.A.255/07)

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*ADDITIONAL RESPONDENTS R15 TO R51

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M. MANI, S/O. VELAYUDHAN NAIR, MALAPURATH HOUSE MUNDAKKAL, CHERUVAYOOR, MALAPPURAM DISTRICT.

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M. HARIDASAN, S/O VELUPANICKER, EDAKKATU HOUSE VILAYIL, MALAPPURAM DISTRICT.

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M. SREEDEVI AMMA, D/o. KOVUNNIPANIKER, MELEPURATH HOUSE, MUNDAKKAL, CHERUVAYOOR, MALAPPURAM DISTRICT.

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K.MUHAMMED, S/o. VEERANKOYA, KAMBRATHIKUZHI HOUSE, VAZHAKKAD, MALAPPURAM DISTRICT.

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M.D.ABDUL SAMAD, S/o. MUHAMMED HAJI, DEVASWOM PARAMBU HOUSE, PULIKKAL, MALAPPURAM DISTRICT.

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T.K. UMMUSALMA, PALAKULATHIL HOUSE, ANANTHAYOOR, VAZHAKKAD, MALAPPURAM DISTRICT.

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V.C. ASHARAF, S/o. SAIDALAVI, VILAYIL CHOLA HOUSE, PUTHALAM, AREACODE, MALAPPURAM DISTRICT.

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M. KHADEEJA, D/o. MUHAMMED HAJI, MUNDOLIL HOUSE, OLAVATTOOR, MALAPPURAM DISTRICT.

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T.K. AHAMMEDKUTTY, S/o. MAMMED HAJI, VAVOOR, CHEEKKODE, MALAPPURAM DISTRICT.

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K. ABDUL SALAM, CHADIYENGARA HOUSE, MUNDAKKAL, CHERUVAYOOR, MALAPPURAM DISTRICT.

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A. RAJASUNDARAN NAIR, S/o. RAMAN NAIR, AKKARATHODI HOUSE, VALIYAPARAMBA, MALAPPURAM DISTRICT.

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M. HASSAN, S/o. UNNIMOYIN, THAMIMADATHIL HOUSE, PULIKKAL, MALAPPURAM DISTRICT.

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P.M. MUHAMMEDKUTTY, S/o. P.M. ABDULLA, PUZHAMKATTIL MALAYIL HOUSE, PULIKKAL, MALAPPURAM DISTRICT.

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M. AYISHABI, D/o. MOIDEEN, RAMLATH HOUSE, CHIRAYIL MALAPPURAM DISTRICT.

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K. MAMMUNNI, S/o. MOIDEEN, KUMMILI HOUSE, NEDIYIRIPPU, MALAPPURAM DISTRICT.

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N. AMINA, W/o. NOORUDHEENKUTTY (LATE), THEKKUMTHOTTATHIL HOUSE, PULIYAKKODE, MALAPPURAM

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DISTRICT.

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A.K. HASSANKOYA, PARACHATHUMMAL HOUSE, K.V.KAVU, MALAPPURAM DISTRICT.

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P.P. SATHEESH CHANDRAN, S/o. MADHAVAN, PUTHUKKOOLIL HOUSE, KARADUPARAMBU, FAROOK COLLEGE, MALAPPURAM

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DISTRICT.

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P.P. SUBRAMANIAN, S/o. RAMAN, PUNNATHKALLIPURATH HOUSE, KARADUPARAMBU, MALAPPURAM DISTRICT.

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K.P. ABDUL AZEEZ, KALATHIL PAYANNAPATTA HOUSE, KARADUPARAMBU, MALAPPURAM DISTRICT.

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K.P. KAMMU, KALATHIL PAYANNAPATTA HOUSE, KARADUPARAMBU, MALAPPURAM DISTRICT.

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K.P. MUHAMMED ALI, PUTHALATH HOUSE, AZHINJILAM, FAROOK COLLEGE, MALAPPURAM DISTRICT.

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K.P. ABDUL RAHMAN, S/o. MOIDEEN, PALLIYALI HOUSE, VAZHAYOOR EAST, MALAPPURAM DISTRICT.

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P.M. ABDUL RAHMAN, S/o. MUHAMMED HAJI, THUDAPURATH HOUSE, VAZHAYOOR EAST, MALAPPURAM DISTRICT.

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P. MOIDEENKUTTY, KUPPATT HOUSE, CHIRAYIL, KONDOTTY, MALAPPURAM DISTRICT.

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MUJEEB RAHMAN V.A., AHOOP HOUSE, KOTTAPURAM,

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MALAPPURAM DISTRICT.

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E. VEERANKUTTY, ETTIYATH HOUSE, THURAKKAL, MALAPPURAM DISTRICT.

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K.T. MUHAMMED, KOORITHODI HOUSE, VALIYAPARAMBU, MALAPPURAM DISTRICT.

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T. VEERANKUTTY, S/o. ENIKUTTY, CHOLAYIL HOUSE, OMANOOR, CHERUVAYOOR, MALAPPURAM DISTRICT.

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I. VELAYUDHAN, S/o. ARUMUGHAN(LATE), ELATHINGAL HOUSE, MUNDAKKAL, CHERUVAYOOR, MALAPPURAM DISTRICT.

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K. MUHAMMED, S/o. MAMMI HAJI, KOODATHINGAL HOUSE, CHEEKKODE, MALAPPURAM DISTRICT.

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P. ABDUL RAHMAN, KOLAMBIL MOOLA HOUSE, OLAVATTOOR, KONDOTTY, MALAPPURAM DISTRICT.

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C. CHEKKU, S/o. ALAVI, CHAMAKALAYI HOUSE, VAZHAKKAD, MALAPPURAM DISTRICT.

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RAMACHANDRAN CHAKKINGAL, S/o. NARAYANAN, KUZHIYAMPARAMBU HOUSE, KUZHIMANNA, KONDOTTY, MALAPPURAM DISTRICT.

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KUNHIKAVU C., W/o. V.C.S. PANICKER, CHANDRA THARA, PUTHUKKODE, RAMANATTUKARA, MALAPPURAM DISTRICT.

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PANALI IBRAHIM, S/o. T. MUHAMMED HAJI, RAHMATH MANZIL, MUNDAKULAM, MUTHUPARAMBU, KONDOTTY, MALAPPURAM DISTRICT.

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51.T. ABDU RAHIMAN, S/o. T. MUHAMMED HAJI, THRIKKULATH HOUSE, UGRAPURAM, AREACODE, MALAPPURAM DISTRICT.

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*(ARE IMPLEADED AS ADDL. R15 TO R51 AS PER ORDER DATED 04.06.07 IN I.A.459/2007.)

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BY ADV. SRI. BABU S. NAIR FOR R5 TO R10

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SRI.C.P. MOHAMMED NIAS-R1 SRI. P.N. MOHANAN-R11 TO R14 SRI. U.K.RAMAKRISHNAN-R1 GOVT.PLEADER SMT. A.G.ANEETHA-R2 TO R4

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THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 10/07/2009 ALONG WITH W.A.NO.161 OF 2007,THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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K. BALAKRISHNAN NAIR

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& C.T. RAVIKUMAR, JJ.

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--------------------------------------------W.A. NOS. 158 & 161 of 2007

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Dated this the 10^th day of July, 2009

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JUDGMENT

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Balakrishnan Nair, J.

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W.A. No.161/2007.

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The writ petitioner is the appellant. Respondents 4 to 9 were the employees of the appellant-Society. They were working as Salesmen in the ration depots run by the appellant. Since the ration depots were not profitable, the appellant-Society decided to close down the depots. To avoid unemployment of the persons working in the depots, the appellant made a request to the Government that the licences of the concerned Authorised Retail Depots (for short “ARDs”) may be granted in favour of the respective salesmen. The appellant submitted that based on the said request, Ext.P1 proceeding was issued by the Government, as per which the licences of 67 ARDs were granted in favour of the erstwhile salesmen of the appellant. While so, respondents 4 to 9 herein approached this Court by filing O.P. No.867 of 2003 for a direction to respondents 2

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W.A. NOS. 158 & 161/2007

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and 3 therein to recover from the appellant-Society the benefits due to them. The appellant claims that it never knew about the pendency of the Original Petition. The said Original Petition was disposed of by Ext.P4, directing the Joint Registrar and the Assistant Registrar concerned to proceed against the appellant-Society (4^th respondent therein) and its assets and clear the dues payable to respondents 4 to 9 towards their terminal benefits. On receipt of the said judgment, the Joint Registrar issued Ext.P3 notice dated 22.3.2005. Pursuant to that notice, the appellant appeared and filed Ext.P5 objection After hearing both sides, the Joint Registrar issued Ext.P6 proceedings, directing the appellant-Society to pay the various service benefits remaining unpaid to the employees. The total amount directed to be paid as per Ext.P6 came to Rs.5,22,028/-.

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The appellant challenged Ext.P6 by filing an appeal before the Government. The Government dismissed the appeal by Ext.P10. Challenging Exts.P6 and P10, the Writ Petition was filed. The learned Single Judge not only repelled the challenge against those orders, but issued a further direction to the Joint Registrar to sell the assets of the Society and to distribute the amounts due to respondents 4 to 9 from the sale proceeds. Feeling aggrieved by the said direction, this appeal is filed by the Society. Against the very same judgment, the 10^th respondent - Malappuram District Co-operative Bank Ltd., filed W.A. No.158 of 2007.

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W.A. NOS. 158 & 161/2007

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The grievance of the District Co-operative Bank is that the appellant owes about Rupees two crores to it and if the direction of the learned Single Judge is implemented, it may not get the amount due to it.

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We heard Sri. C.P. Mohammed Nias, learned counsel for the appellant, Sri. Babu S. Nair, learned counsel for the contesting respondents and Sri. George Poonthottam, learned counsel for the Malappuram District Co-operative Bank Ltd.

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Learned counsel for the appellant submitted that in view of Ext.P1, the contesting respondents are not entitled to claim any amount from the Society. Counsel added that when the ration depots were closed down and the workmen of the erstwhile ARDs raised their claim against the appellant-Society, it moved the Government and the Government issued Ext.P1, as per which the licences of 67 ARDs were granted in favour of the erstwhile salesmen of the appellant. Therefore, the contesting respondents and other salesmen cannot turn round and claim further amounts from the appellant. In the absence of any material to support the submission of the learned counsel for the appellant, we cannot act upon it. Further, there is no provision of law in force which relieves an employer from paying the terminal benefits to an employee, even if the

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W.A. NOS. 158 & 161/2007

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employer helps the employee to find alternative employment. Learned counsel for the appellant further submitted that in any view of the matter, the learned Single Judge should have stopped with repelling the challenge against the impugned orders and that the further directions to sell the assets of the appellant etc. were unwarranted. So, those directions are liable to be vacated, it is submitted. Learned counsel for the 10^th respondent also supported the above submission.

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On the other hand, learned counsel for the contesting respondents pointed out that Ext.P4 judgment having become final, now it ill-comes from the mouth of the appellant that it is not liable to pay any amount to the contesting respondents. It is also submitted that Ext.P4 judgment was passed long ago, on 11.2.2005 and the learned Judge had issued directions to respondents 2 and 3 therein to proceed against the appellant, so that the contesting respondents can get the benefit of Ext.P4 judgment. So, it is prayed that this Court may not interfere with the direction issued by the learned Single Judge on the technical grounds urged by the appellant and the Malappuram District Co-operative Bank.

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We have already found that Ext.P1 order will not relieve the appellant from paying the terminal benefits, if any payable, to its

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W.A. NOS. 158 & 161/2007

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employees, who were working in the ration depots. The direction issued by the learned Single Judge in Ext.P4 has already become final. In obedience to that, Ext.P6 order has been passed by the Joint Registrar. So, the Joint Registrar has to take further action to implement Ext.P6 which was affirmed in Ext.P10. But, we notice that there are other claimants also against the Society. The 10^th respondent claims that the appellant is liable to pay an amount of Rupees two crores to it. If the claim of the contesting respondents is genuine, similarly placed persons who were employees of ARDs can also put forward similar claims. In view of the above position, we feel that appropriate modification should be made to the directions issued by the learned Single Judge. In this context, we also note that the Joint Registrar is already under an obligation to implement the directions in Ext.P4 judgment. But, the implementation can only be subject to law. If there is an order to wind up the Society, the amounts due from it can be paid only on pro-rata basis from the amounts collected by the Liquidator. So, the Joint Registrar shall proceed with further steps to effect payment to the contesting respondents and others and such steps can be by sale of the properties belonging to the Society or other steps found appropriate on the facts of the case. We are not relieving the Joint Registrar of his liability to ensure payment of the amount due to the contesting respondents herein. But, he is given the freedom to devise modalities for securing that end.

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W.A. NOS. 158 & 161/2007

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That means, he can take recourse to all options available to him, including

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sale of the properties of the appellant.

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With the above clarification, this Writ Appeal is disposed of .

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W.A. No.158 of 2007.

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The directions in W.A. No.161 of 2007 will govern this appeal also.

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The Writ Appeal is accordingly disposed of.

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(K. BALAKRISHNAN NAIR) JUDGE

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(C.T. RAVIKUMAR) JUDGE

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sp/

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W.A. NOS. 158 & 161/2007

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K.BALAKRISHNAN NAIR & C.T. RAVIKUMAR, JJ.

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W.A. NOS.158 & 161/2007

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JUDGMENT

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10^th July, 2009

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W.A. NOS. 158 & 161/2007 8

The Malappuram District Co-Op. Bank Ltd. v. the Kondotty Producers-Cum-Consumers Agr

Case brief

What is this about?

What did the court decide?

The Malappuram District Co-Op. Bank Ltd. v. the Kondotty Producers-Cum-Consumers Agr

Case brief

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What did the court decide?

What the court decided

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