G GOPINATHAN NAIR Vs. STATE OF KERALA

JUDGEMENT

(1.) THESE writ petitions raise common questions concerning the validity of section 80 of the Kerala Co-operative Societies Act (hereinafter referred to as the Act) and Rules 182 to 200 and Appendix III of the Kerala Co-operative societies Rules (hereinafter referred to as the Rules) framed under the aforesaid section.

(2.) THE petitioner in O. P. No. 4228 of 1973 is a Co-operative Society carrying on banking business in the name and style the Thiruvalla East Co-operative bank Limited No. 3260. O. P. No. 926 of 1974 is a writ petition filed by a shareholder of the aforementioned Co-operative Society. The petitioners in O. P. No. 4420 of 1973 are four employees of the Kerala State Co-operative Bank ltd. , Trivan-drum.

(3.) BY the impugned Rules framed under Section 80 of the Act, Government have classified the Co-operative Societies according to their type and financial position in the manner shown in Appendix III, prescribed the staff pattern to be adopted by Societies belonging to the different classes and laid down the conditions of service of officers and servants of the different classes of societies. The common plea taken in these writ petitions is that neither the state Legislature nor the State Government is competent to prescribe either by statute or by Rules the staff-pattern and conditions of service of employees of co-operative Societies which are engaged in the business of Banking because the said subject-matter is governed exclusively by the provisions of the Banking regulation Act, 1949 which is a Central enactment dealing inter alia with the subject of staff-pattern and conditions of service of the members of the staff of banking institutions. On this basis it is submitted on behalf of the writ petitioners that the impugned rules made by the State Government in purported exercise of the powers conferred by Section 80 of the Act cannot be regarded as constitutionally valid or enforceable. Another plea put forward by the Co-operative Bank which is the writ petitioner in O. P. 4228 of 1973 is that the pay scales specified in Appendix III are wholly arbitrary and that in case the petitioner-Bank is compelled to give effect to those scales in respect of its staff it will not be possible for the Bank to carry on business as an economically viable unit. According to the learned advocate appearing on behalf of the Bank there has not been due advertence by the rule-making authority to the vitally relevant factor concerning the capacity of. the Banking Societies to meet the additional expenditure that will necessarily result from the re-fixation of the salaries of their employees in accordance with the scales specified in Appendix iii and that the failure to make such a realistic approach renders the impugned rules and the pay scales prescribed in Appendix III unreasonable and arbitrary.