SUNDARESWARAN Vs. STATE OF KERALA

JUDGEMENT

(1.) The subject matter of this Writ Petition relates to preferential payment of workmen's dues in a winding up of a cooperative society. It also pertains to boosting up the value of the assets of the society by the timely intervention of this Court in the present proceeding. The case which is now coming up for decision has a history, something unique. This history has necessarily to be stated for channelizing the reliefs aspired to.

(2.) The petitioners 1 to 16 were the employees of the Palakkad Wholesale Consumer Cooperative Stores Ltd. (for short 'the Society'), which started functioning with effect from 19.10.1963. Since it was running on loss the business carried on by it was discontinued. Consequently the second respondent, in exercise of the powers under S.71(1) of the Kerala Cooperative Societies Act (Act 21 of 1969) (for short 'the Act') passed an order of winding up on 5.7.1986 and appointed the Assistant Registrar of Cooperative Societies, Palakkad as part - time liquidator. There were 79 employees on the roll when the winding up order was passed and the services of 47 among them were terminated on 15.8.1985 and the rest on 4.2.1988 without payment of any retrenchment compensation, arrears of salary, gratuity and other benefits. Out of the 47 employees so terminated, 15 have filed applications under the Payment of Gratuity Act, Industrial Disputes Act etc. and obtained awards for payment of compensation. An amount of Rs. 1,10,000/- had been awarded as compensation to ten employees in the year 1987 and the said sum was recovered by revenue recovery proceedings. The remaining employees have filed similar applications for compensation and obtained awards in their favour. The petitioners 1 to 16 were not paid compensation due to them under the awards passed by the authority under the Payment of Wages Act and the Labour Court, Kozhikode in their favour. A sum of Rs. 6,82,000/-was due to petitioners 1 to 16 by way of gratuity and arrears of wages. Exts P1 and P2 are the copies of the awards passed by the Labour Court, Kozhikode. Even though Exts. P1 and P2 awards were passed respectively on 15.12.1986 and 27.9.1988, no amount was paid to the employees. Therefore, they filed Writ Petition before this Court, O.P. No. 7131 of 1989, for a direction to the respondents 2 to 4 therein to pay the arrears of salary and other benefits as per the rates referred to in it. Ultimately that Writ Petition was disposed of by this Court by judgment dated 8.11.1990 directing the second respondent to take a decision as provided in S.73(2)(c) of the Act before disbursing the amount. Ext. P3 is a copy of the judgment in O.P. No. 7131 of 1989. Since no action was taken by the second respondent in view of Ext. P3 judgment, petition C.M.P. No. 13219of 1991, was filed before this Court. In the above C.M.P. an order was passed by this Court on 13.9.1991 directing the second respondent to take a decision on or before 31.12.1991. In compliance with the said direction Ext. P5 order was passed by the third respondent therein. By Ext. P5 the second respondent ordered that under R.73(2)(c) of the Kerala Cooperative Societies Rules, the assets of the society will be discharged as per the priority mentioned therein. The petitioners being aggrieved by the said order in so far as it declines to deal with the claim made by the petitioners, have filed the present Writ Petition.

(3.) The main prayers contained in the Writ Petition are the following: