Decided on October 03,1978



Gopalan Nambiyar, J. - (1.) The appeal is by the Malabar Motor Transport Cooperative Society for Ex servicemen, Calicut. As the bye laws say, the society was a result of a cooperative venture from among Ex servicemen, and membership of the society was confined exclusively to Ex servicemen. The society was in the habit of employing casual labour or temporary labour from among persons who were not Ex servicemen. Four of such persons represented by the 1st respondent Union raised a dispute before the Industrial Tribunal, Calicut. The issue referred was "Whether civilian employees in the Society are entitled to be confirmed. If not what are all the benefits due to them from the management." By its award, the Tribunal held that there was nothing in the bye laws or in the other provisions to restrict the privileges of the society only to members of the society and that member workers are not specifically classified under the bye laws. The Tribunal's reasoning was put thus "Membership vests with certain rights and liabilities. Member workers are not specifically classified under the bye laws. To put briefly, there is nothing in these bye laws to suggest that these workers who are members are to be treated in a different way. To take a different view of the entire matter the members of the society arc really part of the management in this case. They have a place in the Board of Directors. So the management cannot be heard to say that certain other persons who are not qualified to be members have to be treated in a different way giving them only lesser benefits. There is nothing in these bye laws to substantiate such a view. S.5A and 41 of course restricts the membership to ex servicemen. But when they employ civilian employees for certain reasons they have to be treated for all practical purposes on a par with the other member workers. So this different treatment meted out to these workers cannot be justified. Hence I find that they are entitled to be confirmed." (Para 5) In the Society's writ petition to quash the award, the learned Judge took the view that the Industrial Tribunal was not tied down to any contract or contractual obligation, but was concerned with promoting industrial peace and propagating the concept of social justice. The learned Judge was of the view that it was for the Tribunal to decide how much of the bye laws or the terms of the agreement could be upheld and how much of these could be rejected. The learned Judge was not satisfied that there was in the first instance any impairment to industrial relationship by keeping the employees concerned as a separate or temporary category of workers. The learned Judge accordingly declined to interfere with the award and dismissed the writ petition.
(2.) We find it quite unable to share the reasoning and the conclusion of the learned Judge. The Society was essentially the result of a cooperative venture brought into being under the provision of the Cooperative Societies Act, governed by the provisions of the Act and the bye laws framed by it. Bye law 41 is the relevant bye law which is material for the purposes of this case. A copy of the same has been filed in the writ petition as Ext. P1. That bye law reads: "The Board of Directors shall employ only members for all the items of work to be turned out by the society, provided that in exceptional cases they may, for want of a technically qualified member, appoint one or more non members to work in a department or departments until such time as a member is trained in the required standard of efficiency, or a technically qualified ex soldier joins the society as a member. Persons other than ex servicemen shall be employed in the workshop only on a salary or wages basis and such person shall not be eligible to any of the privileges of membership." It will thus be seen that both from its genesis and by its constitution privileges of membership were not accorded to persons other than ex servicemen employed in the workshop on wage basis. To recognise, as the Tribunal did, that despite the nature and the constitution of the Society and the bye laws by which it was bound, it was open to the Industrial Tribunal to ride a coach and four across these by obliging the Society to recognise as members persons who were not ex servicemen, would completely destroy the very concept of the Society itself. We are tempted to recall the pertinent observations made by Chief Justice M. S. Menon of this Court in Malabar Cooperative Central Bank Ltd., Kozhikode v. State of Kerala (1963 KLT 705). "Cooperative societies are creatures of statute, controlled by their constitution, and concerned with their contracts. Industrial disputes stem, not from the subtle refinements of contractual obligations, but from the rougher jurisprudence of social justice and readjustment The uplands of the Industrial Tribunals are out of bounds to the Registrar of Cooperative Societies." (Para 6) These observations have been repeated and followed quite often in this Court; and one of the recent occasions when they were echoed and followed was in Balachandran v. Deputy Registrar (1978 KLT 249 at 252).
(3.) While great latitude has been recognised in favour of an Industrial Tribunal in not being tied down by contracts and in being able to break existing contracts or to create new contracts, we are unable to hold that it has the power to override the constitution and regulation of cooperative societies governed by the provisions of special statute and bye laws.;

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