Naresh Rane And Ors. vs District Deputy Registrar And ...
2004 Latest Caselaw 250 Bom

JUDGMENT

1. Petitioners are permanent employees of respondent No. 2. They seek a writ of mandamus directing respondent No..l, liquidator of respondent No. 2 to make payments in accordance with statement (Exhibit "C") being their dues during the course of their employment. They seek restraint order against these respondents restraining them from alienating, selling, disposing of any assets of respondent No. 2; bank. It is the case of petitioners that respondent No. 2 bank was promoted by women. It was established in 1972. It is a bank controlled by Smt. Shalinitai Patil. She and her daughter were exclusively looking after its affairs. Head office of the bank is at Dadar and it has branches at Dadar, Mahim, Borivli, Chembur and Dharavi. This bank has assets and properties. However, on account of financial irregularities and mismanagement, Reserve Bank of India took the bank under rehabilitation scheme and issued several orders and directives from time to time. It is contended that immediately after these, entire Board of the Bank resigned on December 30, 1998. The Dist. Deputy Registrar appointed an Administrator and he took charge on January 1, 1999. The Board of Administrators came to be appointed on January 7, 1999 and it functioned till June 30, 1999. During the tenure of Board of Administrators, Reserve Bank of India suggested to the State Rehabilitation Review Committee that the affairs of this bank be enquired under Section 83 of the Maharashtra Co-operative Societies Act, 1960 (for short MCS Act). [In pursuance of this directive, vide an order dated March 17, 1999 District Deputy Registrar initiated enquiry. Against these directives of Dist. Dy. Registrar to initiate enquiry, four directors of the erstwhile Board filed an appeal under Section 154 of MCS Act and the Minister of State for Co-operation by his order dated May 4, 1999 stayed the enquiry on some items. On the items on which inquiry was not stayed, Dist. Dy. Registrar directed initiation of proceedings under Section 83 of MCS Act by his order dated January 18, 2000. Enquiry officer was appointed and his report was submitted to the authorities. Thereafter, another order dated August 11, 2000 was passed under Section 88 of MCS Act and an enquiry officer came to be appointed. Even this enquiry is completed. It appears that the authorised officer had already passed order under Section 88 of the MCS Act fixing assessing the damages/losses and the liabilities on almost all the directors of the Bank. The total liability fixed was Rs. 29.26 Crores. The delinquent directors had filed appeal under Section 152 of the MCS Act before the Divisional Joint Registrar, Co-operative Societies, Mumbai. The liquidators had filed written reply and written submissions in support of the order of the authorised officer and strongly opposed the said appeal. However, the said order under Section 88 of the MCS Act has been set aside and quashed by the Divisional Joint Registrar by his order dated December 26, 2003.

2. Complaint of petitioners is that enquiry has been stayed in so far as four vital items are concerned and therefore a proper enquiry be held on all items. It is contended that prior to December 31, 1998, there were totally 92 employees out of which 45 opted for voluntary retirement and two resigned during liquidation proceedings. As on December 28, 1999, there were totally 43 employees and their dues are not properly computed by liquidator. It is their contention that dues have to be computed on the basis of Section 25F of the Industrial Disputes Act and such calculations are furnished by them at Exhibit C.

3. It is their complaint that liquidator, without completing the proceedings has issued termination letters on November 29, 2001. Their services are sought to be terminated under Section 25FF of the I.D. Act. Employees sought clarification and issued a legal notice complaining about termination orders. They sought his permission under Section 107 of MCS Act to file appeals against proposed termination.

4. Being aggrieved by refusal of respondent No. 2 to grant permission to employees to file appeals under MCS Act and non- payment of their salaries and other dues, petitioners had filed W.P. No. 108 of 2002. This Court by its order dated January 28, 2002 directed respondent No. 2 to disburse a sum of Rs. 20 lakhs to petitioners on pro-rata basis and rest of the claim was directed to be finalised within six months. This Court had issued directions to expedite enquiry proceedings and also to release dues of employees. Petitioners complaint is that even after this order, the issue of assessment of legal dues has not been sorted out. Petitioners invite our attention to prolonged correspondence on record. It is their grievance that inaction of respondent Nos. 1 and 2 in disbursing their dues and permitting alienation of assets of bank has resulted in violation of the mandate of Articles 14 and 21 of Constitution of India as also provisions of M.C.S. Act. It is in these facts and circumstances that reliefs are sought vide this petition.

5. An affidavit has been filed in response to this petition by respondent No. 2. He has contended that petition is not maintainable because petitioners have efficacious alternate remedy which they have availed of and instituted an application (IDA) No. 224 of 2002 in 7th Labour Court at Mumbai under Section 33C of I.D. Act. They are claiming reliefs in this application which are claimed by them in this petition. The said application is still pending. This being the position, present writ petition is not maintainable. Further it is contended that the petition involves disputed question of facts which cannot be decided in writ jurisdiction. He has disputed the number of workmen and invited our attention to enquiry proceedings and other disputes which were filed in Co-operative Court. He has pointed out that he has prepared priority list of depositors, creditors and contributors and after giving notice of hearing he will determine the priority. He submits that claims of petitioners are also included. He assures that he will consider and ascertain claim of all employees as on the date of liquidation.

6. As far as immovable properties and assets are concerned, he has contended that process of realisation of immovable properties is being initiated and a proposal in that behalf is forwarded to Registrar, Co-operative Societies. Finally he submits that he has complied with orders and directions of this Court.

7. In the light of the statements made in the affidavit about return of flat at Mahim to Mrs. Shalinitai Patil, we, vide our order dated February 10, 2004 had directed the Divisional Joint Registrar to file affidavit indicating his stand on this proposal. He was also, directed to file an affidavit on entitlement of employees to salary and allowances till termination of their employment as on December 31, 2001. Wehad also directed him to file an affidavit in so far as proposal forwarded to him by liquidator for realisation of immovable property. We had also directed the Dist. Dy. Registrar to prefer Revision application before the State Government against the order dated December 26, 2003 in Appeal No. 79 of 2003 passed by Divisional Joint Registrar within two weeks from that date. The Divisional Joint Registrar reports compliance of these directions vide his affidavit affirmed on February 20, 2004. He points out that proposal of Mrs. Patil to return her flat which has been sold by her to respondent No. 2 several years ago has been rejected by Government in view of the report of liquidator. He points out that present market price of this flat is much more than the price at which it was sold to respondent No. 2. He points out that this fact has been communicated to Mrs. Patil vide letter dated April 8, 2003. In so far as dues of employees of respondent No. 2 bank, he points out that liquidation order was passed in June 1999. After passing of said order, the then liquidator has freezed the variable D.A., T.A. and other allowances payable to the employees as on July 31, 1999. The terminal dues have been computed till December 31, 2001. He further points out that employees are entitled to closure compensation as per Section 25FF of the I.D. Act which the liquidator has not included in his calculations of terminal dues. He disputes the liabilities of one month's notice pay and submits that 5 liquidator has prepared a statement of dues but petitioners did not agree with that calculation and filed applications under Section 33C of I.D. Act which are pending. In so far as disposal of properties are concerned, in para 420 of his affidavit, he states that proposal of liquidator for disposal of properties is under consideration and necessary steps in accordance with law would be taken in that behalf. 25

8. A further affidavit is filed on February 20, 2004 by liquidator and he sets out details about valuation of properties.

9. It is unfortunate that proceedings are 30 not concluded till date. Further, enquiries under Section 83 and Section 88 of MCS Act are concluded in most unsatisfactory and perfunctory manner. The Divisional Joint Registrar has exonerated the delinquents and 35 the liquidator is forced to challenge his order before State Government. Despite our earlier directions dues of the employees are not ascertained and finalised. The State Government and the Registrar are not 40 coordinating with the liquidator. The assets and properties are yet not realised. These are very sorry state of affairs. Poor employees are running from pillar to post. When will all this conclude is anybody's guess. Therefore, we are constrained to issue further directions. Registrar, Co-operative Societies, Maharashtra State should supervise and monitor the liquidation proceedings and ensure compliance of our directions.

10. In our view, in the light of the affidavits, following directions will meet the ends of justice.

(a) Revision application preferred by Dist. Dy. Registrar against the order dated December 26, 2003 of Divisional Joint Registrar shall be disposed of by State Government in accordance with law within a period of two weeks from today;

(b) The four appeals arising out of disputes being Case No. CC 111/14/93, CC 111/15/93, CC III/16/93 and CC 111/18/93 pending before Maharashtra State Co-operative Appellate Court at Mumbai be heard expeditiously and the learned Member shall endeavour to dispose of the same within three months from today;

(c) Respondent No. 3 is directed to take a decision on the proposal forwarded by respondent No. 2 for realisation of immovable properties details of which are mentioned at para 4 of Affidavit of Divisional Joint Registrar dated February 20, 2004. The proposal submitted by respondent No. 2 vide his letter dated January 30, 2004 be processed expeditiously and necessary orders be passed thereon within a period of six weeks from today;

(d) In so far as dues of employees of respondent No. 2 bank, computed as on December 31, 2001 are concerned, it is directed that without prejudice to rights and contentions of the parties, claims of these employees as ascertained and calculated on that date be finalised and amounts be released in their favour within a period of six months from today.

11. Petition disposed of with above directions. No orders as to costs. Liberty to apply. All concerned to act on an authenticated copy of this order.