IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA. CWP No.166 of 2017 Decided on: 21.08.2026 ____________________________________________________ H.P. State Cooperative Bank Limited ……….. petitioner Versus Jitender Jamwal and others ……….respondents ____________________________________________________ Coram: Hon'ble Mr. Justice Bipin Chander Negi, Judge Whether approved for reporting? 1 For the petitioner : Mr. Sunil Mohan Goel, Sr. Advocate, with Mr. Raman Jamalta Advocate. For the respondents : Mr. R.L. Chaudhary, Advocate, for respondents No. 1 & 2. Mr. Pranay Pratap Singh, Additional Advocate General, for the respondents/State. Mr. Vijay Mokta, Advocate, vice Mr. Vijay Chaudhary, Advocate, for respondents No. 16, 17, 20, 21 and 23. Name of respondents No. 4 to 15, 18, 19 and 22 were deleted vide order dated 14.6.2017. ____________________________________________________ Bipin Chander Negi, Judge (oral) In the present writ petition, the order dated 3.12.2016 (Annexure P-5, page 92 of the paper book) has been assailed, whereby the appeal preferred by respondents No. 1 and 2 before the Appellate Authority, ACS-cum-Secretary (Cooperation) to the 1 Whether the reporters of the local papers may be allowed to see the judgment? 2 Government of Himachal Pradesh, has been proceeded with (Appeal No. 21 of 2016), on the premise that the petition preferred under Section 72(1)(c) of the H.P. Cooperative Societies Act, 1968 (hereinafter for purpose of brevity, as ‘the Act’) read with Rule 88 of the H.P. Cooperative Societies Rules, 1971 (hereinafter referred to as ‘the Rules’), filed by respondents No. 1 and 2 before the Registrar, Cooperative Societies, is maintainable. 2. Heard counsel for the parties. Perused the pleadings. 3. From the perusal of the order sheet, it is evident that when the matter was taken up on 20.01.2017, operation of the order dated 3.12.2016, impugned in the case at hand, had been stayed. Relevant order dated 20.01.2017 reads as follow:- “CMP No. 608 of 2017 Infructuous. CWP No. 166 of 2017 Issue notice. Mr. J.K. Verma, learned Deputy Advocate General, appears and waives service of notice on behalf of respondent No.3. Issue separate notices to respondents No. 1 &2 and 4 to 23, on taking steps within two weeks, returnable on 20.3.2017. List on 20.3.2017. CMP No. 609 of 2017 Notice in the aforesaid terms. Reply be filed on or before the next date of hearing. In the meantime, operation of order dated 3.12.2016, passed by the learned ACS-cum-Secretary (Co-operation) in Appeal No. 21/2016 (Annexure P-5), shall remain stayed. Alteration/modification and vacation on motion. Copy dasti.” 4. From the reliefs being claimed by respondents No. 1 and 2, in the petition filed by them under Section 72(1)(c) of the Act and Rules, before the Registrar, Cooperative Societies, it is evident 3 that the dispute raised therein primarily was a service dispute. The reliefs sought have been reproduced in the order dated 30.09.2016 passed by the Registrar, Cooperative Societies (pages 86 to 91, Annexure P-4). 5. In the aforesaid backdrop, before the Registrar, a question of maintainability of the petition so preferred by respondents No. 1 and 2 had been raised. The same had been answered by the Registrar by placing reliance on the judgment of the Apex Court in Morinda Coop. Sugar Mills Limited v. Morinda Coop. Sugar Mills Workers Union, (2006) 6 SCC 80, and the judgment of a Division Bench of this High Court in LPA No. 116 of 2026 titled Sanjeev Kumar v. State of H.P., decided on 17th March 2026, wherein it has been categorically held that a dispute inter se an employer and its employee does not fall within the ambit of Section 72 of the Act. In Morinda Coop. Sugar Mills Limited, a suit filed claiming dearness allowance on wages plus fixed allowance was held to be maintainable by the trial Court. The First Appellate Court reversed the judgment and decree of the trial Court, holding that the subject matter of the suit cannot be said to be a dispute touching the business of the society. The High Court affirmed the said finding. 6. Feeling aggrieved by the aforesaid, the defendant before the trial Court (appellant before the Supreme Court) assailed the judgment of the High Court. The Apex Court affirmed the judgment passed by the High Court. In doing so, the Apex Court 4 held that the dispute raised by the employees relating to dearness allowance and fixed allowance was a dispute concerning their conditions of service and could not be said to be a dispute touching the business of the society. Relevant extract of the Morinda’s case reads as follow for a ready reference:- “9. This Court in O.N. Bhatnagar v. Smt. Rukibai Narsindas and Others (AIR 1982 SC 1097) observed inter alia as follows:- " 20 In the present case the society is a tenant co- partnership type housing society formed with the object of providing residential accommodation to its co-partner tenant members. Now, the nature of business which a society carries on has necessarily to be ascertained from the object for which the society is constituted, and it logically follows that whatever the society does in the normal course of its activities such as by initiating proceedings for removing an act of trespass by a stranger, from a flat allotted to one of its members, cannot but be part of its business. It is as much the concern of the society formed with the object of providing residential accommodation to its members, which normally is its business, to ensure that the flats are in occupation of its members, in accordance with the bye-laws framed by it, rather than of a person in an unauthorized occupation, as it is the concern of the member, who lets it out to another under an agreement of leave and licence and wants to secure possession of the premises for his own use after the termination of the licence. It must, therefore, follow that a claim by the society together with such member for ejectment of a person who was permitted to occupy having become a nominal member thereof, upon revocation of licence, is a dispute falling with the purview of Section 91(1) of the Act." 10. In Deccan Merchants Co-operative Bank Ltd. v. M/s. Dalichand Jugraj Jain (1969 (1) SCR 887) it was held as follows:- "Five kinds of disputes are mentioned in sub- section: First, disputes touching the constitution of a society: secondly, disputes touching election of the office bearers of a society: thirdly, disputes touching the conduct of general meeting of a society: fourthly, disputes touching the management of a society: and fifthly disputes touching the business of a society. It is clear that the word " business" in this context does not mean affairs of a society because election of office-bearers, conduct of general meetings and management of a society would be treated as affairs of a 5 society. In this sub-section the word "business" has been used in a narrower sense and it means the actual trading or commercial or other similar business activity of the society which the society is authorized to enter into under the Act and the Rules and its bye-laws." 11. In Co-operative Central Bank Ltd. and others etc. v. Additional Industrial Tribunal, Andhra Pradesh, Hyderabad and others etc. [1969 (2) SCC 43] it was held that alteration of the conditions of the service of the workman would not be covered by the expression "touching the business of the society". It was held inter alia as follows : "7 Applying these tests, we have no doubt at all that the dispute covered by the first issue referred to the Industrial Tribunal in the present cases could not possibly be referred to decision to the Registrar under Section 61 of the Act. The dispute related to alterations of a number of conditions of service of the workmen which relief could only be granted by an Industrial Tribunal dealing with an industrial dispute. The Registrar, it is clear from the provisions of the Act, could not possibly have granted the reliefs claimed under this issue because of the limitations placed on his powers in the Act itself. It is true that Section 61 by itself does not contain any clear indication that the Registrar cannot entertain a dispute relating to alteration of conditions of service of the employees of a registered society: but the meaning given to the expression "touching the business of the society". In our opinion, makes it very doubtful whether a dispute in respect of alteration of conditions of service can be held to be covered this expression. Since the word "business" is equated with the actual trading or commercial or other similar business activity of the society, and since it has been held that it would be difficult to subscribe to the proposition that whatever the society does or is necessarily required to do for the purpose of carrying out its objects, such as laying down the conditions of service of its employees, can be sad to be a part of its business, it would appear that a dispute relating to conditions of service of the workmen employed by the society cannot be held to be a dispute touching the business of the society." 7. Respondents No. 1 and 2, in order to up-hold the view taken by the Appellate Authority in the impugned order dated 3.12.2016, have placed reliance on the judgment of the Apex Court in Ghaziabad Zila Sahkari Bank Limited v. Addl. Labour Commissioner and others, (2007) 11 SCC 756. Relevant extract whereof reads as follow:- 6 “82. Alongwith the appeal, some appointment orders have been filed as annexures. The appointment order clearly says that the services were governed by the Service Regulations, 1975 and the bye-laws of the bank. It is relevant to mention here that the services of the employees of the Bank are governed by service regulations 1975 framed under the Act of 1965, which provides complete machinery and adjudication. Moreover, the provisions under Section 70 of the U.P. Cooperative Societies Act, 1965 is elaborate in this regard, which provides complete machinery that if there is any dispute between the employers and the employees of the Cooperative Society, the matter shall be referred to the Arbitrator as provided under Section 70 of the U.P. Cooperative Societies Act, 1965. Section 70 of the U.P. Cooperative Societies Act and Section 64 of the M.P. Cooperative Societies Act are pari materia and this Court in the matter of R.C. Tewari vs. M.P. State Cooperative Marketing Federation Ltd. 1997 (5) SCC 125 held that Labour Court and Industrial Laws are not applicable where complete machinery has been provided under the provisions of the Cooperative Societies Act and in such view of the matter the Ld. Additional Labour Commissioner U.P. has no jurisdiction to pass orders in the nature it has been passed. 83 The relevant legal provisions requiring consideration of this Court are quoted below: "Section 70. Disputes which may be referred to arbitration.- (1) Notwithstanding anything contained in any law for the time being in force, if any dispute relating to the constitution, management or the business of a co-operative society other than a dispute regarding disciplinary action taken against a paid servant of a society arises- (a) among members, past members and person claiming through members, past members and deceased members; or (b) between a member, past member or any person claiming through a member, past member or deceased member, and the society, its committee of management or any officer, agent or employee of the society, including any past officer, agent or employee; or (c) between the society or its committee and any past committee, any officer, agent or employee or any past officer, past agent or past employee or the nominee, heir or legal representative of any deceased officer, deceased agent, or deceased employee of the society; or xxx xxxx xxxx [Provided that a dispute relating to an election under the provisions of this Act or rules made thereunder shall not be referred to the Registrar until after the declaration of the result of such election.] 7 (2) For the purpose of sub-section (1), the following shall be deemed to be included in dispute relating to the constitution, management or the business of a co-operative society, namely- (a) claims for amounts due when a demand for payment is made and is either refused or not complied with whether such claims are admitted or not by the opposite party; (b) a claim by a surety against the principal debtor where the society has recovered from the surety any amount in respect of any debt or demand due to it from the principal debtor as a result of the default of the principal debtor or whether such debt or demand is admitted or not; (c) a claim by a society for any loss caused to it by a member, officer, agent, or employee including past or deceased member, officer, agent, or employee, whether individually or collectively and whether such loss be admitted or not; and (d) all matters relating to the objects of the society mentioned in the bye-laws as also those relating to the election of office-bearers. (3) If any question arises whether a dispute referred to the Registrar under this section is a dispute relating to the constitution, management or the business of a co-operative society, the decision thereon of the Registrar shall be final and shall not be called in question in any court. Section 71. Reference of dispute to arbitration.- On receipt of a reference under sub-section (1) of Section 70, the Registrar may, subject to the provisions of the rules, if any- (a) decide the dispute himself, or (b) refer it for decision to an arbitrator appointed by him, or (c) refer it, if the parties so request in writing, for decision to a board of arbitrators consisting of the three persons to be appointed in the prescribed manner. (2) The Registrar may, for reasons to be recorded, withdraw any reference made under clause (b) or (c) of sub-section (1) and refer it to another arbitrator or board of arbitrators or decide it himself. (3) The Registrar, the arbitrator or the board of arbitrators, to whom a dispute is referred for decision under this section may, pending the decision of the dispute make such interlocutory orders including attachment of property as he or they may deem necessary in the interest of justice. (4) The decision given by the Registrar, the arbitrator or the board of arbitrators under this section shall hereinafter be termed as award. (5) The procedure to be followed by the Registrar, the arbitrator or the board of arbitrators in deciding a dispute and making an award under this section shall be as may be prescribed. 84. Since payment of ex-gratia amount of the employees of the bank is a policy matter, the State Government of U.P. has filed Special Leave Petition before this Court questioning the correctness of the orders passed by the 8 High Court for the leave of this Court. The impugned judgment of the High Court suffers from the error of complete non-application of mind on the merits of the case in as much as whole pleadings either before the Commissioner and before the High Court was that the payment of ex-gratia to the employees are against the objects of the society and it is in contravention of the provisions of the U.P. Act, 1947, rules and regulations, we have no other option to set aside the same and allow both the appeals filed by the bank as well as the State of U.P. as already indicated in the paragraphs above. The payments already made need not be recovered at this distance of time from the employees of the bank. However we make it clear that the employees are not entitled to ex-gratia payment from now onwards. In the facts and circumstances, we order no costs”. 8. Section 70 of the U.P. Act is not pari materia with Section 72 of the H.P. Act. In Section 70(1) of the U.P. Act the following addition has been incorporated, “other than a dispute regarding disciplinary action taken against a paid servant of a society arises’’. It is on account of the same that it has been held in Ghaziabad Zila Sahkari Bank Limited (cited supra) that if there is any dispute between the employers and the employees of the Cooperative Society, the matter shall be referred to an Arbitrator (para 82 of the judgment). Reliance therein has been placed on the judgment of the Apex Court in R.C. Tiwari v. M.P. State Cooperative Marketing Federation Limited, (1997) 5 SCC 125, wherein Section 64 of the M.P. Act was being considered. Section 64 of the M.P. Act and Section 70 of the U.P. Act are stated to be pari materia. Besides therein section 55 of the M.P. Act authorized the Registrar or any officer appointed by him, not below the rank of Assistant Registrar to decide a dispute qua the terms of employment, working conditions, disciplinary action inter-se the society and its employees. On account of the aforesaid 9 reasons the judgement in Ghaziabad Zila Sahkari Bank Limited cited by the respondents to support the impugned Order dated 3.12.2016 is distinguishable and not applicable in the case at hand. 9. Hence in view of the law laid down in Morinda Coop. Sugar Mills Limited v. Morinda Coop. Sugar Mills Workers Union, (2006) 6 SCC 80, and the judgment of the Division Bench of this Hon’ble High Court in LPA No. 116 of 2026 titled Sanjeev Kumar v. State of H.P., decided on 17th March 2026, writ petition is allowed, order dated 3.12.2016 is quashed and set aside. The proceedings initiated by respondents No. 1 & 2 before the Registrar, in the case at hand, are held to be not maintainable before the Registrar. Pending miscellaneous application(s), if any, shall also stand disposed of. (Bipin Chander Negi) Judge 21st August, 2026 Tarun Singh