JUDGMENT
Sanjay Kishan Kaul, J.
1. Rule.
2. With the consent of learned counsel for the
parties the matter is taken up for final disposal.
3. The petitioner are officers and employees
working in different capacities at different centres of
hindustan Vegetable Oils Corporation Limited –
respondent No. 2. The performance of respondent No. 2
apparently started suffering from 1991 onwards and in
1996 the case of respondent No. 2 was referred to
Disinvestment Commission. The Disinvestment Commission
submitted its report and the case of respondent No. 2
corporation was also referred to Board For Industrial
And Financial Reconstruction (for short the BIFR) under
Section 15(1) of the Sick Industrial Companies (Special
Provisions) Act, 1985 (for short the said SICA) in
December, 1999. The BIFR declared respondent No. 2
corporation as a sick industrial company in terms of
the provision of Section 3(1)(o) of the said Act. The
petitioner and other officers of the respondent No. 2
corporation also moved the BIFR to be imp leaded as
party and sought directions for revival of respondent
No. 2. Certain directions were passed by the BIFR.
4. The petitioner is aggrieved by the order dated
6.11.2000 issued by the Government of India introducing
a Voluntary Separation Scheme (VSS) for the employees of
respondent No. 2. The scheme was kept open for a period
of 3 months and it was envisaged in the said order that
the employees who failed to apply under the scheme
would be eligible only for retrenchment under the
provisions of the Industrial Disputes Act, 1947. A
representation was made by the petitioners for keeping
in abeyance the said scheme till the BIFR considers the
issue or in the alternative pay wages/compensation in
terms of the directions of the Supreme Court relating
to the Subzi Mandi unit of respondent No. 2.
5. The petitioner has ultimately filed the
present petition seeking the following relief:-
“a) issue a writ of mandamus
or any other appropriate writ order
or direction directing the
respondent to extend the proposed
Voluntary Separation Scheme dated
6.11.2000 vide Notification
No.F. 5-3/99 HVOC till the final
decision is taken by the BIFR for
the purposes of
revival/rehabilitation of HVOC; and
b) issue a writ of mandamus or
any other appropriate writ order or
direction directing the Respondent
authorities to formulate a ‘Golden
Hand Shake’ Scheme based on the
package as ordered by the Hon’ble
Supreme Court in T.A.No. 30 in Writ
Petition No. 4677/1985 dated 31.12.96
on the revised wages/salaries’
6. Mr. Rajiv Dutta, learned senior counsel appearing
for the petitioner has contended that the basis of the
scheme of voluntary separation as also the short period
within which the application was sought from the
employees is arbitrary and illegal. The said scheme
was sought to be implemented under the threat of
closure. The learned senior counsel contends that the
benefits to be extended to the employees cannot be
decided in isolation and that the employees would be
entitled for their dues and claims w.e.f. 1.4.97.
Thus the contention is that the revision of the pay
scale having been given to the other public sector
enterprises w.e.f. 1.1.97 should also be made
applicable to respondent No. 2 corporation. Mr. Dutta,
learned senior counsel, has contended that even the
Disinvestment Commission took note of the substantial
assets of respondent No. 2 and observed as under:-
“The estimate value of the
other freehold real estates owned by
HVOCL Units (as per valuation
performed by Central Bureau of
Direct Taxes (CBDT) in November,
1996) is quite substantial. Hence,
the net inflow to Government by
closing down all the units by
liquidating their assets and selling
the breakfast foods unit after
settling all the claims and
retirement benefits would still be
high.”
7. Learned senior counsel while contending that the
purport of the scheme is in fact to scuttle the
proceedings before the BIFR referred to the note to
para 6.1.1 of the voluntary retirement scheme of
Hindustan Organic Chemicals Limited to the following
effect:-
“i) Salary for the purpose of
calculation of compensation in
respect of officers shall be
notionally on revised pay scales of
officers, as approved by the Board
of Directors/Government.
ii)….
iii)…
iv) Arrears of salary/wage
revision, shall however, become
payable only when company generates
adequate surplus through improved
productivity ‘and profitability to
the satisfaction of Administrative
Ministry.’
8. The aforesaid Sub-clause 4 is also being
reproduced because it has relevance when the matter in
question will be considered.
9. The learned senior counsel has also referred to
certain proceedings before the BIFR of 1.2.2001 to
contend that even BIFR was of the view that VSS
extended to the company was an indication to the staff
that the company was to be closed down in due course
and was a sort of a threat that in case the employees
did not accept the VSS they would be paid retrenchment
dues. The BIFR observed that the Government could not
unilaterally decide this matter.
10. Ms. Tamali Wad, learned counsel for respondent
No. 1, on the other hard, has contended that he prayers
made in the writ petition have to be seen and no
directions can be issued in favor of the petitioner on
the existing prayers. Learned counsel has further
contended that it is for the first time in rejoinder
that a reference has been made to different schemes of
voluntary separation retirement of other public sector
companies though this was not the case set out in the
petition. Learned counsel has referred to (iv) para of
the Note referred above to contend that if the two
clauses of the Note are read together it would be
apparent that the arrears of salary/wages would become
payable in that case only when the company generates
adequate surplus. The learned counsel also referred to
the office memorandum dated 14.1.99 issued by the
Ministry of Industries in respect of policy for the 6th
round of wages negotiation in public sector enterprises
where in para 2 it is stated that as regards sick units
registered under the BIFR until BIFR approves revival
plans in which provision shave been made for additional
expenditure on account of pay revision, no pay revision
would be allowed to the employees of such enterprises.
11. I have heard learned counsel for the parties at
length.
12. In my considered view the illustration of terms
of voluntary retirement scheme of other public sector
enterprises would not be directly relevant to the case
of respondent No. 2. Each company will have its own
financial calculations and a scheme has to be devised
keeping in mind the financial position of that company.
There may be situations where in one particular scheme
additional emoluments are paid but they may be deferred
depending on the amounts generated as in the case
mentioned above. These are matters of weighing the
economic condition of a particular company and no
uniform pattern can be made in respect of the same.
13. In the earlier order dated 16.1.2002 it was
already noted that present writ petition is really
related to two reliefs. In so far as the second relief
is concerned the same is based on a package as was
directed by the Hon’ble Supreme Court in IA 30 in Writ
Petition No. 4677/85 dated 31.12.96. The said package
was in the peculiar facts of that case as units were
directed to be shifted from the existing places being
polluting units. The package was applicable not only
to the unit of respondent No. 2 but also to all such
polluting units. The said direction can by no means be
made applicable to the issue of general viability of
respondent No. 2 unit nor can that form the basis for
the grant of any voluntary separation scheme or
otherwise.
14. The first relief claimed in the writ petition is
for extension of time for voluntary separation scheme.
Admittedly, the petitioner and other employees applied
under the said scheme, have been considered under the
said scheme and have availed of the benefits of the
said scheme. It may, however, be noted that the said
scheme was availed of without prejudice to the rights
and contentions of the petitioner in terms of the order
dated 12.1.2001.
15. The contention of learned senior counsel for the
petitioner that the benefit of 1997 wages should be
given to the petitioners cannot be sustained as
admittedly that is not in the package offered under the
VSS scheme. Not only this respondent No. 2 is before
the BIFR and in terms of the office memorandum dated
14.1.99 the revision of wages was subject to the
provisions to be made for additional expenditure on
account of such pay revision where companies like
respondent No. 2 were before the BIFR.
16. It may also be noted that during the pendency of
the present writ petition the proceedings before the
BIFR have been concluded and have culminated in an
order dated 7.12.2000.
17. It may be in the end noted that these are
matters of economic consideration working out packages
taking the overall health of the company in
consideration. The Constitution Bench of the Supreme
Court had the occasion recently to consider the case of
Disinvestment in the case of BALCO Employees’
Union (Registered) v. Union of India 2001 (8) SCALE
541. The relevancy of the said judgment is to the
extent as to what is the scope of enquiry by the courts
in the matters relating to economics and functioning of
the companies. While dealing with the rights of the
employees the Supreme court observed as under:-
“47. process of disinvestment is a policy
decision involving complex economic factors. The
Courts have consistently refrained from
interfering with economic decisions as it has
been recognised that economic expediencies lack
adjudicative disposition and unless the economic
decision, based on economic expediencies, is
demonstrated to be so violative of constitutional
or legal limits on power or so abhorrent to
reason, that the Courts would decline to
interfere. In matters relating to economic
issues, the Government has, while taking a
decision, right to “trial and error” as long as
both trial and error are bonafide and within
limits of authority. There is no case made out
by the petitioner that the decision to disinvest
in BALCO is in any way capricious, arbitrary,
illegal or uninformed. Even though the workers
may have interest in the manner in which the
Company is conducting its business, inasmuch as
its policy decision may have an impact on the
workers’ rights, nevertheless it is an incidence
of service for an employee to accept a decision
of the employer which has been honestly taken and
which is not contrary to law. Even a government
servant, having the protection of not only
Articles 14 and 16 of the Constitution but also
of Article 311, has no absolute right to remain
in service. For example, apart from cases of
disciplinary action, the service of government
servants can be terminated if posts are
abolished. If such employee cannot make a
grievance based on part III of the Constitution or
Article 311 then it cannot stand to reason that
like the petitioners, non-government employees
working in a company which by reason of judicial
pronouncement may be regarded as a State for the
purpose of Part III of the Constitution, can
claim a superior or a better right than a
government servant and impugn it’s change of
status. In taking of a policy decision in
economic matters at length, the principles of
natural justice have no role to play. While it
is expected of a responsible employer to take all
aspects into consideration including welfare of
the labour before taking any policy decision
that, by itself, will not entitle the employees
to demand a right of hearing or consultation
prior to the taking of the decision.
48. Merely because the workman may have
protection of Articles 14 and 16 of the
Constitution, by regarding BALCO as a State, it
does not mean that the erstwhile sole shareholder
viz., Government had to give the workers prior
notice of hearing before deciding to disinvest.
There is no principle of natural justice which
requires prior notice and hearing to persons who
are generally affected as a class by a economic
policy decision of the Government. If the
abolition of a post pursuant to a policy decision
does not attract the provisions of Article 311 of
the Constitution as held in State of Haryana v.
Shri Des Raj Sangar and Anr., (1976) 2 SSC
844, on the same parity of reasoning, the policy
of disinvestment cannot be faulted if as a result
thereof the employees lose their rights or
protection under Articles 14 and 16 of the
Constitution. In other words, the existence of
rights of protection under Articles 14 and 16 of
the Constitution cannot possibly have the effect
of vetoing the Government’s right to disinvest.
Nor can the employees claim a right of continuous
consultation at different stages of the
disinvestment process. If the disinvestment
process is gone through without contravening any
law, then the normal consequences as a result of
disinvestment must follow.”
18. It is thus apparent from a reading of the
aforesaid judgment that the Supreme Court has held that
employment of the employees with a public sector
enterprise is an incidence of the service of the
employee and the employee would thus be bound by the
decision taking honestly which is not contrary to law.
It is further held that there is not right in the
employees to demand hearing or consultation prior to
the taking of the decision.
19. The petitioner is thus not entitled to any of
the reliefs claimed in the petition. In view of the
aforesaid facts and circumstances I am of the
considered view that no case is made out for
interference under Article 226 of the Constitution of
India.
20. Dismissed.