R.GOGULACHANDRAN v. UNION OF INDIA,

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2.The order impugned states that all these writ petitioners had joined the services of the Lakshmi Vilas Bank Limited and continued in the services and thereafter, opted Bank's Voluntarily Retirement Scheme. The Voluntary Retirement Scheme applications submitted by the respective writ petitioners were accepted by the competent authorities of the Bank and these writ petitioners were relieved from service on various dates.

3.The impugned order further states that all these writ petitioners had opted for Contributory Provident Fund and when the Bank gave an option for the employees to join the pension fund during the year 995 as per the All India Settlement. Inspite of the options granted, the writ petitioners had opted for contributory provident fund and accordingly, their terminal and other benefits were settled in accordance with the terms and conditions of the Voluntary Retirement Scheme.

4.Challenging the said order of rejection, the learned counsel for the writ petitioners states that the cases of other clause of employers were considered for grant of pension. The other persons, who had opted for pension scheme, were granted monthly pension

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and the writ petitioners were served for more than 20 years and all are eligible for pension as per the Pension Scheme in force in the Bank. In view of the fact that the cases of other group of employers were considered by the respondents, the case of the writ petitioners also to be considered for grant of pension scheme.

5. The learned counsel appearing on behalf of the Union of India opposed the contentions by stating that once an employee opted the Voluntary Retirement Scheme and accepted the benefits with reference to the terms and conditions of the Scheme, then he cannot claim pension scheme or any other scheme subsequently. In other words, after acceptance of the Voluntary Retirement Scheme as well as the benefits attached to the scheme, the employee cannot turn around and claim pension scheme contrary to the terms and conditions of the Voluntary Retirement Scheme, which was accepted. Thus, the writ petitions are devoid of merit and to be dismissed.

6.This Court is of the considered opinion that the admitted facts in these writ petitions are that all the writ petitioners were employed in the fourth respondent/Lakshmi Vilas Bank. All the writ

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petitioners were opted for the Voluntary Retirement Scheme of the Bank and accordingly relieved from their respective services. All these writ petitioners were opted for contributory provident fund only. The fourth respondent Bank gave an option for the employees to join the pension fund during the year 995 as per the All India Settlement. Inspite of the options, the writ petitioners had opted for Contributory Provident Fund and accordingly, the terminal and other benefits were settled in accordance with the scheme. The writ petitioners had received the benefits attached to the Voluntary Retirement Scheme and received the same after relieving from service. All these writ petitioners were relieved in between the year 200-2004. After accepting the benefits, the writ petitioners had approached the respondents for second option so as to grant pension under the pension scheme. However, the present writ petitions are filed only during the year 204 after a lapse of more than 0 years from the date of relieving of the writ petitioners from service. Thus, the writ petitions are liable to be rejected on the ground of laches also.

7.In respect of the legal principles, the Hon'ble Supreme Court of India in the case of A.K.Bindal and another Vs. Union of India and

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others reported in 2003 (5) SCC 63 held as follows:-

"8.We are unable to accept the contention of Shri Venkataramani that on account of non-revision of pay scales of the petitioners in the year 992, there has been any violation of their fundamental rights guaranteed under Article 2 of the Constitution. Article 2 provides that no person shall be deprived of his life or personal liberty except according to procedure established by law. The scope and content of this Article has been expanded by judicial decisions. Right to life enshrined in this Article means something more than survival or animal existence. It would include the right to live with human dignity. Payment of very small subsistence allowance to an employee under suspension which would be wholly insufficient to sustain his living, was held to be violative of Article 2 of the Constitution in State of Maharashtra v. Chandrabhan Tale AIR 983 SC 803. Similarly, unfair conditions of labour in People's Union for Civil Liberties v. Union of India AIR 982 SC 473. It has been held to embrace within its field the right to livelihood by means which are not illegal, immoral or opposed to public policy in Olga Tellis v. Bombay Municipal Corporation AIR 987 SC 08. But to hold that mere non-revision of pay scale would also amount to a violation of the fundamental right guaranteed under Article 2 be stretching it too far and cannot be countenanced. Even under the

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Industrial law, the view is that the workmen should get a minimum wage or a fair wage but not that his wages must be revised and enhanced periodically. It is true that on account of inflation there has been a general price rise but by that fact alone it is not possible to draw an inference that the salary currently being paid to them is wholly inadequate to lead a life with human dignity. What should be the salary structure to lead a

"life with human dignity" is a difficult exercise and cannot be measured in absolute terms. It will depend upon nature of duty and responsibility of the post, the requisite qualification and experience, working condition and a host of other factors. The salary structure of similarly placed persons working in other Public Sector Undertakings may also be relevant. The petitioners have not placed any material on record to show that the salary which is currently being paid to them is so low that they are not able to maintain their living having regard to the post which they are holding. The observations made in paragraphs 276 and 277 in Delhi Transport Corporation v. D.T.C. Mazdoor Congress(supra), strongly relied upon by learned counsel for the petitioners, should not be read out of its context. In the said case the Court was called upon to consider the constitutional validity of Regulation 9 of Delhi Road Transport Authority (Conditions of Appointment and Service) Regulations, 952, which

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gave power to terminate the services of an employee after giving one month's notice or pay in lieu thereof. The termination of services of some of the employees on the ground that they were inefficient in their work by giving one month's notice was set aside by the High Court as in its opinion Regulation 9(b) gave absolute unbridled and arbitrary powers to the management to terminate the service of any permanent or temporary employee and, therefore, the same was violative of Article 4 the Constitution. It was in this context that the aforesaid observations were made by one Hon'ble Judge in his separate opinion. The issue involved was not of revision of pay scale but that of termination of service which has an altogether different impact on an employee."

22. In South Malabar Gramin Bank v. Coordination committee of South Malabar Gramin Bank Employees' Union and South Malabar Gramin Bank Officers' Federation and Ors. (200) 4 SCC 0, relied upon by the learned counsel for the petitioners, the Central Government had referred the dispute regarding the pay structure of the employees of the Bank to the Chairman of the National Industrial Tribunal headed by a former Chief Justice of a High Court. The Tribunal after consideration of the material placed before it held that the officers and employees of

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the Regional Rural Banks will be entitled to claim parity with the officers and other employees of the sponsor banks in the matter of pay scale, allowances and other benefits. The employees of nationalised commercial banks were getting their pay scales on the basis of 5th bipartite settlement and by implementation of the award of the National Industrial Tribunal, the employees of the Regional Rural Banks were also given the benefits of the same settlement. Subsequently, the pay structures of the employees of nationalised commercial banks were further revised by 6th and 7th bipartite settlements but the same was not done for the employees of the Regional Rural Banks who then filed writ petitions. It was contended on behalf of the Union of India and also the Banks that financial condition of the Regional Rural Banks was not such that they may give their employees the pay structure of the employees of the nationalised commercial banks. It was in these circumstances that this Court observed that the decision of the National Industrial Tribunal in the form of an award having been implemented by the Central Government, it would not be permissible for the employer bank or the Union of India to take such a plea in the proceedings before the Court. The other case namely All India Regional Rural Bank Officers Federation & Ors. v. Government of India & Ors. (2002) 3 SCC 554 arose out of interlocutory applications and contempt petitions which were filed for

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implementation of the direction issued in the earlier case namely South Malabar Gramin Bank (supra). Any observation in these two cases to the effect that the financial capacity of the employer cannot be held to be a germane consideration for determination of the wage structure of the employees must, therefore, be confined to the facts of the aforesaid case and cannot be held to be of general application in all situations. In Associate Banks Officers' Association v. State Bank of India & Ors. 998 () SCC 428 it was observed that many ingredients go into the shaping of the wage structure of any organisation which may have been shaped by negotiated settlements with employees' unions or through industrial adjudication or with the help of expert committees. The economic capability of the employer also plays a crucial part in it; as also its capacity to expand business or earn more profits. It was also held that a simplistic approach, granting higher remuneration to workers in one organisation because another organisation had granted them, may lead to undesirable results and the application of the doctrine would be fraught with danger and may seriously affect the efficiency and at times, even the functioning of the organisation. Therefore, it appears to be the consistent view of this Court that the economic viability or the financial capacity of the employer is an important factor which cannot be ignored while fixing the wage structure,

otherwise the unit itself may not be able to function and may have to close down which will inevitably have disastrous consequences for the employees themselves. The material on record clearly shows that both FCI and HFC had been suffering heavy losses for the last many years and the Government had been giving considerable amount for meeting the expenses of the organisation. In such a situation, the employees cannot legitimately claim that their pay scales should necessarily be revised and enhanced even though the organisations in which they are working are making continuous losses and are deeply in red.

27.Apart from what we have discussed earlier, it is necessary to take note of a subsequent development which has a serious impact on the relief claimed by the petitioners. The respondents have filed an affidavit on 5.2.2003 sworn by Shri Pawan Wadhwa, Deputy Secretary, Department of Fertilizers, Ministry of Chemicals and Fertilizers. It is averred in the said affidavit that the accumulated losses as on 3..2003 of HFC have been Rs.742.52 crores and that of FCI have been Rs.8874.00 crores. To meet the expenditure towards salary, wages as well as other administrative expenses in these units including preservation cost of the plants, total plan and non-plan budgetary assistance to the tune of Rs.2,227.00 crores has been extended by

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the Government of India till 3..2003. The commercial production in some of the units of both the companies never commenced and the remaining units suspended operations one by one as viability/economics of production of urea in these plants had become extremely unfavourable. The revival packages of these companies could not be taken up for want of funding tie up with the Financial Institutions on account of their reservation about the techno-economic viability of the proposals. The revival package based on unit-wise techno-economic viability were considered by the competent authority in the Government from time to time culminating in Government's decision on 8.7.2002 and 5.9.2002 for closure of majority of the units of both FCI and HFC along with supporting establishments. The Government had incurred an expenditure for Rs.72.96 lakhs per month in respect of HFC and Rs.69 lakhs per month in respect of FCI in implementing the orders of this Court dated 9.4.2000 and 8.8.2000. The accumulated expenditure which had been borne by the Government of India through non-plan budgetary support till date as on this account adds up to Rs.6.56 crores in respect of FCI and Rs. 2.56 crores in respect of HFC. It is further averred that in October 998 the Government announced a scheme for Voluntary Retirement for the employees of the Central Public Sector Undertakings. This scheme was liberalised and

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another scheme was announced on 5.5.2000 in order to give benefit to the employees of the Enterprises in which pay revision with effect from ..992 and ..997 had not been affected. The Government announced further liberalised scheme on 6..200 under which the Voluntary Retirement compensation on the basis of their existing pay (basic + DA) was increased by 00 per cent and 50 per cent respectively. According to the respondents almost 99 per cent of employees of FCI and HFC had opted for the Voluntary Retirement Scheme (for short VRS). The exact figures regarding implementation of the Scheme as on 24.3.2003 is given below:

PSU-WISE DETAILS OF IMPLEMENTATION OF VRS S. No. Item HFC FCI

. Total employees as on

20.9.2002 488 572

2. Employees opted for VRS 478 5675

3. Employees released 4325 5097

4. Funds released by DOF (Rs. Crores) 74.50 253.50 5.Funds actually utilized by the company 54.0 237.30

6. Balance funds with the Company 20.50 6.20

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34.This shows that a considerable amount is to be paid to an employee ex-gratia besides the terminal benefits in case he opts for voluntary retirement under the Scheme and his option is accepted. The amount is paid not for doing any work or rendering any service. It is paid in lieu of the employee himself leaving the services of the company or the industrial establishment and forgoing all his claims or rights in the same. It is a package deal of give and take. That is why in business world it is known as 'Golden Handshake'. The main purpose of paying this amount is to bring about a complete cessation of the jural relationship between the employer and the employee. After the amount is paid and the employee ceases to be under the employment of the company or the undertaking, he leaves with all his rights and there is no question of his again agitating for any kind of his past rights, with his erstwhile employer including making any claim with regard to enhancement of pay scale for an earlier period. If the employee is still permitted to raise a grievance regarding enhancement of pay scale from a retrospective date, even after he has opted for Voluntary Retirement Scheme and has accepted the amount paid to him, the whole purpose of introducing the Scheme would be totally frustrated.

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35.The contention that the employees opted for VRS under any kind of compulsion is not worthy of acceptance. The petitioners are officers of the two companies and are mature enough to weigh the pros and cons of the options which were available to them. They could have waited and pursued their claim for revision of pay scale without opting for VRS. However they, in their wisdom thought that in the fact situation VRS was a better option available and chose the same. After having applied for VRS and taken the money it is not open to them to contend that they exercised the option under any kind of compulsion. In view of the fact that nearly ninety nine per cent of employees have availed of the VRS Scheme and have left the companies (FCI & HFC), the writ petition no longer survives and has become infructuous."

8. The Hon'ble Apex Court of India held that "if the employee is still permitted to raise a grievance regarding enhancement of pay scale from a retrospective date, even after he has opted for Voluntary Retirement Scheme and has accepted the amount paid to him, the whole purpose of introducing the Scheme would be totally frustrated."

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9.The above legal principles squarely applies to the present writ petitions as the writ petitioners also had opted Voluntary Retirement Scheme and accordingly received the settlement and after a lapse of more than 0 years they had approached this Court for the second option so as to avail the benefit of option under the pension scheme. This being the factum, the writ petitioners have not established any acceptable legal grounds for the purpose of considering the relief as such sought for in these writ petitions. 0.In respect of the submissions made on behalf of the writ petitioners that the cases of similarly placed persons were considered. The writ petitioners are at liberty to approach the competent authorities, if at all the similarly placed persons cases were considered by the Bank for grant of pension. Accordingly, all these writ petitions stand dismissed. However, there shall be no order as to costs. Consequently, connected miscellaneous petitions are closed.

24.06.209

Index:Yes/No Internet:Yes/No Ls/Am

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To The Secretary to Government, Union of India,

Ministry of Finance, Department of Financial Services, Banking Division,

Jeevan Deep Building,

Parliament Street,

New Delhi - 0 00.

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S.M.SUBRAMANIAM,J.

Ls

W.P.(MD)Nos.036 of 205,96 to 984, 4655 to 4659 of 204

and

W.M.P.(MD)Nos.20277 to 20305 of 207

24.06.209