ORDER
1. The petitioner in W.P. No. 7583 of 1998 is serving as an Officer in Scale-II in the respondent-Vijaya Bank. The petitioners in the remaining three writ petitions are the unrecognised trade unions of the Officers of the Bank. Their prayer is to restrain the respondent-Bank from enforcing certain clauses of the Transfer Policy envisaged in its Circular No. 267 of 1991, dated 24-12-1991 as amended by Circulars No. 82 of 1996, dated 10-4-1996 and No. 35 of 1998, dated 12-2-1998 being An-nexures-B, D and E respectively of W.P. No. 7583 of 1998.
2. Justifying the rotational transfers of the Officers of the Banks, the Additional Secretary to the Government of India, Department of Finance, Banking Division has stated on affidavit that.-
“rotational transfers were found necessary in the Banks to ensure that longer stay of any person at a particular place may not lead
to unhealthy relationship with private parties as many frauds in the Banks have reportedly taken place due to such nexus. Such rotational transfers also help in timely detection of frauds. It was, therefore, found necessary that every Officer without any exception has necessarily to be shifted from one branch/office to another periodically. The measure was found imperative as of public policy in the public interest to ensure safety and protection of public finance”.
3. The objective set out in Circular No. 267 of 1991 (Annexure-B) for formulating the transfer policy for periodical transfer of Officers is to match the business requirements of the Bank and human resources development. But as set out in the said objective, the Bank management found it necessary to take into account the problems of re-allocation incidental to mobility with human relations approach.
4. The grievance of the petitioners is that the grant of exemption to some of the Officers of the Bank from transferability on the grounds of age, sex and holding of office in the recognised trade unions is violative of the statutory provisions contained in Sections 7(2), 8 and 19(2)(d) of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (in short, “the Act”) read with Regulation 47 of the Vijaya Bank (Officers’) Service Regulations, 1982 (in short, “the Regulations”) and for that reason, or even otherwise is violative of Articles 14 and 16 of the Constitution of India.
FACTS AND PLEAS RAISED
5. The first petitioner is the domicile of Karnataka. He is presently posted at Bangalore as a Manager and is sought to be transferred to Jalgaon (Maharashtra) Branch of the Bank as Branch Manager. Admittedly, this petitioner has worked for three years as an Officer in the “North” and for two years and seven months in Tondiarpet Branch in the State of Tamil Nadu. Keeping in view these facts and questioning the Transfer Policy under the three Circulars referred to above, his contention is that he cannot be moved out of his home State.
6. According to the petitioners, to their knowledge, at least 180 officials have been working in Bangalore without being moved out of this State either in South or North which, according to them, amounts to hostile discrimination meted to otherwise similarly situated Officers by the Bank management without any intelligible criteria, rationality or even classification befitting the test of Articles 14, 15 and 16 of the Constitution of India. According to them, when Regulation 47 of the Regulations has made all the Officers liable for transfer to any office or branch of the Bank situated in any place in India, then the Bank management cannot carve out privileges of exemption as a matter of general policy, express or implied, for any particular section of the Officers only because they have attained certain age or because they are armed with a bargaining weapon as Officers of recognised trade union or just because they are women.
7. Though the respondent-Bank has not categorically denied the allegations levelled by the petitioners, but, in the Counter affidavit, they have found it more convenient to take the stand that even if it is assumed for the sake of argument that several Officers are continuing at Bangalore without any transfer, still, the petitioner in W.P. No. 7583 of 1998 cannot maintain his challenge to the transfer policy because he has not completed his one full tenure outside his home State in the South and further that he has not yet crossed the age of 52 years and is running only 47th year of his age. This petitioner has specifically asserted in paragraph 5 of the writ petition that no lady Officer has been transferred though they are being promoted from time to time. The respondent-Bank in its statement of objection has clearly admitted that “excepting Officers under exempted category as specified in the policy and lady Officers, all male Officers have either served in North or have put in inter-State service. With regard to deputation of three Officers to Vijaya Bank Housing Finance which is a subsidiary of the respondent-Bank, it has been stated that the period of deputation being of three years will end in October 1998 and therefore, they have not been transferred in the current year”.
8. So far as non-transfer of office bearers of recognised trade unions is concerned, the answer of the respondent-Bank is that though the Central Government has objected to grant of exemption to them from rotational transfers but the Bank has found it necessary to retain them at the central office because that would facilitate negotiation with the association. It has also been stated that the Board could not take any positive decision on the transferability of such Officers because of the pendency of the present writ petitions filed by the rival unions.
LEGAL FRAMEWORK
9. The respondent-Bank owes its present existence to the Act. Chapter IV of the Act provides for management of such Banks. Sub-section (2) of Section 7 provides that.-
“Section 7(2).–The general superintendence, direction and management of the affairs and business of a corresponding new Bank shall vest in a Board of Directors which shall be entitled to exercise all such powers and do all such acts and things as the corresponding new Bank is authorised to exercise and do”.
10. Section 8 of the Act makes it mandatory for the Bank to be guided by the directions of the Central Government issued under and in accordance thereto. This section reads thus:
“Section 8. Corresponding new Banks to be guided by the directions of the Central Government.–Every corresponding new Bank shall, in discharge of its functions, be guided by such directions in regard to matters of policy involving public interest as the Central Government may, after consultation with the Governor of the Reserve Bank, give”.
11. Section 19 of the Act empowers the Board of Directors of the Bank to make regulations for the matters expedient for the purpose of
giving effect to the provisions of the Act. Clause (d) of sub-section (2) of this section is of importance. This reads as under.-
“Section 19(2).–In particular, and without prejudice to the generality of the foregoing power, the regulations may provide for all or any of the following matters, namely.-
(d) the conditions or limitations subject to which the corresponding new Bank may appoint advisors, Officers or other employees and fix their remuneration and other terms and conditions of service;
12. Keeping in view the powers vested under Section 7(2) read with Section 19(2)(d), the Board of Directors, in consultation with tbe Reserve Bank of India and with previous sanction of the Central Government, have framed the regulations in question. Clause 47 of these Regulations provides for transfer of Officers. It reads thus.-
“Clause 47. Transferability.–Every Officer is liable for transfer to any office or branch of the Bank or to any place in India”.
13. The material clauses in the impugned transfer policy envisaged by the Board of Directors for employees upto MMG Scale-Ill are as follows:
“3.5.0. Tenure.– “Tenure” means active service in
(a)
North
– 3
years
(b)
North-Eastern
Region
– 2
years
(c)
Disturbed
Areas
– 2
years
(d)
Hardship
branches
– 2
years
(e)
Inter-State
– 4
years
Explanation: … … …
3.6.0. – North.– “North” means the following States and Union Territories:
States:Arunachal Pradesh, Assam, Bihar, Gujarat, Haryana, Himachal Pradesh, Jammu and Kashmir, Madhya Pradesh, Manipur, Nagaland, Orissa, Punjab, Rajasthan, Sikkim, Tripura, Uttar Pradesh, West Bengal and Meghalaya.
U.T.: Andaman and Nicobar, Chandigarh, Dadra and Na-gar Haveli, Daman and Diu and Delhi.
3.7.0. – South.–“South” means the following States and Union Territories.-
States: Andhra Pradesh, Karnataka, Kerala, Maharashtra, Tamil Nadu and Goa.
U.T.: Pondicherry and Lakshadweep.
4.0.0. – Norms for transfers.–Subject to Regulation 47 of the Vijaya Bank (Officers’) Service Regulations, 1982, the following norms are laid down.
4.9.0. – Cut-off age.–Normally Officers who have completed 48 years of age are not liable for transfer to North. However, Officers who have completed 48 years of age but not completed 52 years of age are liable for inter-State Transfer.
4.10.0. – Cut-off date.–The cut-off date for relieving/reporting upon transfer shall be as determined by the Bank from time to time. For the year 1992, the Officers transferred from North to South should be relieved in between 7th and 12th May and should report for duty on or before 23rd May. In the case of Officers transferred from South to North, they should be relieved in between 14th and 19th May and should report on or before 30th May.
4.11.4. – Office bearers of recognised Registered Trade Union of Officer employee.–The Central Office Bearers of the Registered Trade Union of Officer Employees recognised by the Bank will be placed in the centre where the Head Office of the Bank is situated and they are exempted from transfers during their tenure as such. Further, this exemption is limited to only 6 such Central Office Bearers and available so long as the recognition granted by the Bank is in force.
4.13.0. – Notwithstanding any provision contained in the transfer policy, the Chairman and Managing Director reserves the right to effect transfer on compassionate/medical grounds at his discretion. But such cases should be informed to the Association before effecting the transfers”.
14. Circular No. 35 of 1998 (Annexure-B), to the extent it is relevant, reads as under.-
“those promotee Officers who have 6 years or less service left before retirement shall be exempted from transfer to North/North-East or outside the State. As regards those Officers who are promoted in the promotion process 1997-98 and currently undergoing inter-State tenure will also be transferred to North/North-East, if they have not completed 54 years of age as on the cut-off date (31-5-1998)”.
CONSIDERATION OF PLEAS
15. It is no doubt true that it is within the managerial discretion of an employer to organise and arrange his business in the manner he considers best but this proposition has to be held as circumscribed by statutory limitations laid down under the statutory provisions applicable to the class of employers. It is also well established that a creature of the Statute like the respondent-Bank has to exercise its managerial discretion within the peripheries of the Act, Scheme and the Regulation. Therefore, while exercising its discretion to transfer its Officers from any of its office or branch situated across the country, it has to keep in its forefront the specific provisions contained in regulation 47 of the regulations quoted above.
16. Regulation 47 of the regulations in quite clear words and without admitting any ambiguity spells out that every Officer of the Bank is liable for transfer to any office or branch of the Bank to any place in India. Therefore, under the Regulations, every Officer irrespective of his age, office or sex is liable to be transferred from one office/branch of the Bank to another, irrespective of the fact whether it is situated in one or the other State of the Country. This is an express condition attached to the service of every Officer. Therefore, the foremost question to be considered herein is as to whether on the face of such binding provision in the Regulations, the Bank management can override the same by purported exercise of its power of management by exempting certain class of its Officers from the general liability of being transferred either by granting complete exemption or exempting them from transfer to North or North-Eastern States on attainment of 52/54 years of age. In my considered opinion, a bare reading of Section 7(2) of the Act clearly impels an answer in negative since the power of management vested in the Board can be exercised only to the extent it is authorised by the statute and the Regulations framed thereunder and not beyond that.
17. Even if it be presumed for the sake of argument that the Bank management can on some extended argument riggle out of the statutory limitation still then, it remains to be considered as to whether the classification of Officers on the ground of age or sex or being office bearers of recognised unions can withstand the forensic test of reasonable classification for the purposes of Articles 14 and 15(3) of the Constitution of India.
18. Regarding constitutionally permissible classification, in the case of Suneel Jatley v State of Haryana, it has been held by the Supreme
Court that.-
“It is well-settled that Article 14 forbids class legislation but permits reasonable classification. In order to sustain the classification permissible under Article 14, it has to satisfy the twin tests:
(1) that the classification is founded on an intelligible differentia which distinguishes persons or things that are grouped together from others left out of the group and (2) the differentia must have a rational relation to the object sought to be achieved by the impugned provision”.
19. Keeping in view the aforesaid tests, now I can proceed to examine the validity of the questioned paras of the impugned transfer policy framed by the respondent-Bank.
Re: Exemption on the ground of cut-off age
20. Para 4.9.0. read with Circular No. 35 of 1998 (Annexure-E) provides exemption for the year 1997-98 from transfer to Officers to North if they have completed 54 years of age on the cut-off date i.e., 30-5-1998. But, as per the said para, Officers who have completed 48 years of age but not completed 52 years of age are liable for inter-State transfer. The
moot question to be considered is whether any Officer can be exempted from transfer to a branch or office either in the North/North-East or even in South outside his home State only on the basis of his having attained a certain age. The allegation of the petitioner is that many Officers have been given benefit of not being transferred to North because upto the given cut-off age, they were allowed to remain in their home State or southern States and thereafter, they have been made to enjoy the benefit of exemption on the basis of acquiring the cut-off age.
21. Presently, the retiring age of the Officers of the Bank is 60 years. Therefore, it is to be presumed that till upto the attainment of the said age, they remain physically and mentally sound to discharge the duties attached to their office. If that be so, then irrespective of the age group in which the particular Officer falls, he is bound by the liability of being transferred to any part of the country as provided under Regulation 47. The reasonableness of the classification made on the basis of age has not been sought to be established in the statement of objections. So, on the very face of it, this classification does not appear to be founded on any intelligible differentia having any rational basis or nexus to the object sought to be achieved which must necessarily have a real and understandable bearing on the administration of operations/business conducted by the respondent-Bank. That being so, in my opinion, the exemption granted on the basis of cut-off age has to be held as constitutionally impermissible being wholly arbitrary and irrational.
Re: Exemption to women Officers
22. No doubt, the transfer policy envisaged by the Bank under the three impugned Circulars (Annexures ‘B’, ‘D’ and ‘E’) does not contain an exemption from transfer in favour of woman Officers but it has been specifically alleged in the writ petition that “lady Officers are not transferred even though they are promoted from time to time”. This fact has not been controverted by the management of the respondent-Bank. In the statement of objection, the Bank has not set out any ground to justify its action of granting general exemption to lady Officers from transfer. This question needs to be examined with reference to Article 15(3) of the Constitution which enables the State, which for the purposes of Part III of the Constitution includes the respondent-Bank as well, to make special provisions for women and children even with regard to service conditions. In the case of Yousof Abdullah v State of Bombay, it has been held that “Article 14 is general and must be read with other provisions which set out the ambit of fundamental right. Sex is a sound classification and although there can be no discrimination in general on that ground, that Constitution itself provides for special provisions in the case of women and children”. The same view has been taken by the Supreme Court in its later decision, Miss C.B. Muthamma v Union of India and Others, wherein it has been held that.-
“We do not mean to universalise or dogmatise that men and women are equal in all occupations and all situations and do not exclude the need to pragmatise where the requirements of particular employment, the sensitivities of sex or the peculiarities of societal sectors or the handicaps of either sex may compel selectivity. But save where the differentiation is demonstrable, the rule of equality must govern”.
23. Again, in the case of Air India v Nergesh Meerza and Others , the Supreme Court has held that.-
“What Articles 15(1) and 16(2) prohibit is that discrimination should not be made only and only on the ground of sex. These Articles of the Constitution do not prohibit the State from making discrimination on the ground of sex coupled with other considerations”.
24. At this juncture, I find it advisable to refer to the judgment of the Supreme Court in the case of Bank of India v Jagjit Singh Mehta , wherein it has been held that.-
“There can be no doubt that ordinarily and as far as practicable
the husband and wife who are both employed should be posted at
the same station even if their employers be different. The desir
ability of such a course is obvious. However, this does not mean
that their place of posting should invariably be one of their choice,
even though their preference may be taken into account while
making the decision in accordance with the administrative needs.
In the case of All-India Services, the hardship resulting from the
two being posted at different stations may be unavoidable at times
particularly when they belong to different services and one of
them cannot be transferred to the place of the other’s posting.
While choosing the career and a particular service, the couple
have to bear in mind this factor and be prepared to face such a
hardship if the administrative needs and transfer policy do not
permit the posting of both at one place without sacrifice of the
requirements of the administration and needs of other employees.
In such a case the couple have to make their choice at the thresh
old between career prospects and family life. After giving preference to the career prospects by accepting such a promotion or any
appointment in an All-India Service with the incident of transfer
to any place in India, subordinating the need of the couple living
together at one station, they cannot as of right claim to be relieved
of the ordinary incidents of All-India Service and avoid transfer to
a different place on the ground that the spouses thereby would be
posted at different places”.
25. A conjoined reading of Articles 14, 15 and 16 of the Constitution, the import and extent whereof has been clearly explained by the Apex
Court, no doubt permits the respondent-Bank to treat the lady Officers of the Bank as a class for giving certain privileges in the matters of transfer provided the same can be justified on demonstrable handicaps of the said class in withstanding the inconveniences caused by such transfers. But, it can be done only by making special provisions in this regard, i.e., by making suitable amendment to Regulation 47 in accordance with requirements of Section 19 of the Act. Right at the moment, there is no occasion for me to examine as to whether any such special provision, if made, will withstand the test of reasonable classification but I am firmly of the opinion that if it is permissible to do so, then it must be done by clearly declaring the said policy in a manner which could be known to all concerned and which can be claimed and exercised by the lady Officers of the Bank as of right without being dependent on any mercy, compassion or fanciful discretion of the management. Making of such a provision will make the things predictable, certain and transparent and can easily eliminate the apprehension of class or individual harassment based on ill-will or bias.
Re. Para 4.11.4. Immunity/exemption from transfers to office bearers of recognised trade unions
26. The grant of exemptions from transfers to six office bearers of the All-India Vijaya Bank Association, which is a registered trade union and is enjoying recognition of the Bank as representing the majority of its Officers, seems to be a matter of controversy for a long time which has not only dragged the parties to judicial fora on the contentious issue but has also forced the Central Government to issue appropriate guidelines in respect thereof and even to make a statement before the Lok Sabha declaring its policy decision to not to continue the same. But, surprisingly it is still being continued possibly because of the pressure and coercions built up by the majority union wielding its collective bargaining power.
27. The resondent-Bank, in its statement of objection dated 6-7-1998, has disclosed that there are three Officers’ unions functioning in the respondent-Bank namely, Vijaya Bank Officers’ Congress (petitioner in W.P. No. 7345 of 1998 and W.P. No. 29934 of 1996), Vijaya Bank Officers’ Union (petitioner in W.P. No. 25128 of 1997) and All-India Vijaya Bank Officers’ Association which is the recognised trade union and is a respondent in the said writ petitions. It has been disclosed on affidavit that as on 31-3-1997, the said unions had the membership strength of 4.30%, 20.78% and 72.45% respectively. The remaining 2.47% are non-unionised Officer employees. The Bank has given recognition to the Officers’ association representing the majority of its Officers.
28. In respect of the six office bearers of the recognised union, the respondent-Bank has disclosed that so far as Sri C. Gopinathan Nair, Sri Rajan Kumar Sethi and Sri Dayanand Sethi are concerned, they are not liable to be transferred even without invoking the present exemption clause since they have completed their respective tenures as per the policy and are having their posting at Bangalore since 1992, 1993 and 1997 respectively. But so far as the remaining three office bearers are
concerned, the disclosure is startling. The information set out in respect of these three Officers are as follows.-
“(1)Sri T. Jagannath Hegde is working in Bangalore since 6-12-1982.
(2)Sri Shivaram Alva is working in Bangalore since 23-6-1983.
(3)Sri T. Krishnaraj Bhat is working in Bangalore since 27-9-1980″.
29. Therefore, the above noted Officers are stationed at Bangalore for more than fifteen years.
30. In the case of Mahaveer Das v UCO Bank, a Division Bench of the Calcutta High Court had an occasion to deal with a similar problem in which case as well, Regulation 47 of the Service Rules of the UCO Bank was pari materia with Regulation 47 in the present case. The Bench has held that.-
“Union leader cannot claim any preferential treatment and/or any immunity from transfer when transfer is a condition of service and in this regard, a discrimination could not be made between an employee who is not a union leader and an employee who is a union leader. Under our Constitution, an employee has trade union right subject to condition and restrictions. The trade union activities are not to be performed during the office hours is as much as such an employee is paid by public exchequer for his official duty and not for his trade union activities. Trade union activities are to be performed beyond office hours. In the matter of laying down the principles and guidelines for transfer, the authorities concerned cannot lay down any rule which is contrary to the statutory rules”.
31. The Central Government, under its letter F. No. 4/9/2/95-IR, dated 17-12-1996, addressed to the respondent-Bank had said that.-
“I am directed to refer to your letter No. PER:HRD:MRS:F-2301:10360:96, dated 27th November, 1996 on the above subject and to say that in terms of guidelines issued vide this Division’s Letter No. 6/7/3/87-IR, dated: 24th October, 1980 the office bearers of the Officers association are not entitled for any of the facilities other than special leave as mentioned therein. They are, therefore not exempted from the General Transfer Policy of the Bank and they are to be treated at par with others in the matter of postings and transfers. Copy of guidelines is enclosed. Bank is advised to treat the Government guidelines seriously and not to throw such circulars in. the dustbin. This matter may also be put up before the board”.
32. It has also been brought on the record that the matter of transfer in nationalised banks was one of the subject-matters for discussion in
Lok Sabha on 14-3-1997. Two members of the Parliament had called upon the Minister of Finance to enlighten on four questions, namely,
“(a) Whether any directives have been issued by Government to Nationalised Banks for transfer of Officers of various cadres after every three years etc. from a Branch/Office/Region to another Branch/Office/Region/Zone;
(b) Whether any exemption have been given from such transfers to activists/office-bearers/leaders of Officers association etc., recognised by the management etc.;
(c) if so, the reasons thereof; and
(d) if not the steps taken by Government for such violations?”
33. The reply to the said questions given on behalf of the minister on the floor of the Parliament was to the following effect.-
“(a), (b), (c) and (d).–The transfer of Banks’ staff is a management function of the Bank. As such transfer/exemption from transfer is done by Banks based on administrative exigencies of each Bank.
However, Government has advised the Banks that they should review the periodic rotation of the staff and not let them continue at the same branch/office for an unduly long time. It was also advised that Officers and award staff should not normally continue at the same place for more than three and five years respectively and no exemption have been given from such transfers to office bearers of any recognised Officers association”.
34. Apart from the question of binding nature of the aforesaid directions issued by the Central Government and the obligation of the respondent-Bank to give due regard to the policy decision declared by the Central Government on the floor of the Parliament, regarding the adoption of policy of transfer in relation to office bearers of recognised trade unions, in my opinion, even going by the simple English words used in Regulation 47 of the Regulations, it was beyond the competence on the part of the management of the respondent-Bank to concede to any exemption/immunity to the office bearers of recognised trade unions who are by all means bound by the condition and incidents of transferability attached to their posts. The decision taken by the management to exempt them from rotational transfers cannot be justified by any stressed reasonableness. Such office bearers cannot claim any privilege or benefit beyond what is available to the common members of their cadre. In this regard, I respectfully agree with the view expressed by the Calcutta High Court in the case of Mahaveer Das, supra.
35. At this juncture, I feel it advisable to refer to the judgment of this Court in W.P. Nos. 14711 to 14715 of 1992 dismissed on 27-11-1992 and which was affirmed in the Division Bench passed in Writ Appeal Nos. 2656 to 2660 of 1992 dismissed on 8-2-1996. These writ petitions were preferred by one of the petitioner unions herein namely, Vijaya Bank Officers’ Congress and its office bearers questioning their transfers on
the ground that they are also entitled to the benefit of the exemption clause contained in para 4.11.4. But, the plea did not find favour with the learned Single Judge. The Division Bench, inter alia, held that.-
“In case the Bank had not recognised appellant 1-union, then the learned Advocates for the appellants very fairly did not dispute that the provisions of para 4.11.4. of the transfer policy are not attracted. Consequently, the challenge to the orders of transfer on the ground that the office bearers cannot be transferred outside the office cannot be entertained”.
36. In my opinion, the above judgment of this Court does not have any real bearing on the issues involved herein.
37. In the case of B. Varadha Rao v State of Karnataka, it has clearly been laid down that when the power of transfer is abused, the exercise of power is vitiated. In the present case, I, for one, is of the firm view that the management of the respondent-Bank, while incorporating para 4.11.4. in its transfer policy, has grossly misused its inherent power of transfer in taking the decision that the office bearers of its recognised union will not be transferred. This decision stands vitiated on the touchstone of reasonableness. I hold that all such office bearers are liable for transfer in terms of Regulation 47 and they cannot be favoured with any exemption from normal rotational transfers.
Re. Clause 4.13.0.–Clause 4.13.0. requiring advance information to the recognised union regarding management’s discretion to effect transfers on compassionate / medical grounds.
38. Serious objections have been taken on behalf of the petitioners regarding the right of participation given to the respondent recognised union in the matters pertaining to transfer of Officers on compassionate/medical grounds. Clause 4.13.0. of the impugned transfer policy empowers the Chairman and Managing Director to exercise their discretion to effect transfers on compassionate/medical grounds which means that they, in their discretion, can deviate from the normal policy of rotational transfers by taking into account the genuine hardships of individual Officers. There is no objection to this part of the impugned para. But, it is found to be highly objectionable that exercise of this discretion by the Chariman and Managing Director has been subjected to a disputed condition that any decision taken by them in the said regard can he effected only after giving information of the same to the recognised association. This could only mean that recognised association, to its pleasure, can object to the exercise of such discretion. The Central Government has also expressed reservations about this para on the ground that transfer is purely management prerogative depending upon the exigencies of administration and the trade unions cannot be involved in the taking of such administrative matters.
39. In order to substantiate the permissibility of the offending part in the impugned para, Sri Rajgopal, Counsel appearing for recognised un-
ion, has submitted that the provision so made are in consonance of directive principles under Article 43-A of the Constitution of India and therefore, nobody should feel hurt or agonised by the same.
40. Article 43-A of the Constitution of India inter alia directs the State to make suitable legislation to ensure participation of workers in the management of undertakings, establishments or other organisations engaged in any industry. In Section 9(3) of the Act, providing for Constitution of Board of Directors of the Bank, due care has been taken to comply with the said Constitutional directive. This reads thus.-
“Section 9(8).–Every Board of Directors of a corresponding new Bank, constituted under any scheme made under sub-section (1), shall include.-
(a) representatives of the employees, and of depositors, of such Bank, and
(b) such other persons as may represent the interests of each of the following categories, namely, farmers, workers and artisans, to be elected or nominated in such manner as may be specified in the scheme”.
41. Keeping in view the intendments underlying the above statutory requirement, the Central Government has made the “Nationalised Banks (Management and Miscellaneous Provisions) Scheme, 1980”. Clause 3 of the Scheme has set out the details for the constitution of the Board of Directors. Sub-clause (c) of the said clause is only material for the present purposes. It is to the following effect.-
“Clause 3. Constitution of the Board.–As soon as may be after the commencement of this Scheme, the Central Government shall, by notification in the Official Gazette, constitute the Board of a nationalised Bank, consisting of.-
(a) …..
(b) …..
(c) one Director from among the employees of the nationalised Bank, who are not workmen to be appointed by the Central Government after consultation with the Reserve Bank;
…..”.
42. In connection with the implementation of the above scheme in relation to appointment of non-workmen employee, Sri Rajgopal, learned Counsel appearing for the recognised majority union, has brought to my notice the judgment of the Supreme Court in the case of All India Bank Officers’ Confederation v Union of India. In this judgment, the Apex Court, after taking into account the provisions of the Constitution, Act, the Scheme and the past practice that the Central Government was to appoint a non-workmen Director from out of a panel of three names
furnished to it by the majority association of such employees, has held that.-
“that means, it would be perfectly in order for the Central Government to continue the practice followed by it prior to the circular in question or to hold election of the representatives of the concerned employees, and, if necessary, to amend the scheme suitably for that purpose”.
43. It is admitted at the Bar by all the contesting parties that a representative of non-workmen employees of the Bank is being appointed by the Central Government as one of the Directors in the Board of the Bank keeping in view the above law laid down by the Supreme Court. Therefore, it cannot be disputed that there is an effective representation of the contesting Officers in the Board of management to take care of their interest and ventilation of their grievances. In my opinion, the recognised union is not entitled to any further participation in the affairs of the management and therefore, the offending part of the para 4.13.0. which provides for giving of information to the association before effecting transfers on compassionate/medical grounds cannot and should not be given effect to.
Conclusions
44. It may be relevant to observe here that though in view of the judgment of the Supreme Court in the case of M/s. Parry and Company v P.C. Lal, the liability of an employee to be transferred and the right of the employer to transfer him are to be kept in distinct compartments since it admits of no doubt that merely because an employee as a condition or incidence of his service is liable to be transferred, that does not necessarily mean that the employer is duty bound to transfer him even if the administrative exigency does not require so. But here we are not concerned with this aspect of service jurisprudence. The issue involved herein is as to whether the respondent-Bank, which is a statutory legal entity, can formulate policy pertaining to the transfer of its employees which is opposed to constitutional and statutory provisions. The answer to this has to be necessarily in negative.
45. The above situation now largely stands mitigated by the affidavited statements made both on behalf of the respondent-Bank as also the Central Government.
46. In paragraph 3 of the affidavit filed by the respondent-Bank, in connected W.P. No. 25128 of 1997, it has been stated that.-
“I submit that the respondent-Bank has now decided to amend the transfer policy of 1991, 1996 and 1998 in respect of 5 clauses viz., clauses 3.5.0., 4.9.0., 4.10.0., 4.11.4. and 4.13.0. as advised by the Central Government and to implement the same to effect transfers from the year 1999 onwards as transfers for the year 1998 have already been completed and given effect to”.
47. The Joint Secretary in Banking Division, Ministry of Finance has also in its affidavit dated 1-7-1998 stated that (para 9).-
“the Chairman and Managing Director of the Vijaya Bank has now informed the Union of India that steps are being taken to implement the advice of the Government”.
48. Coming to the individual case of the petitioner in W.P. No. 7583 of 1998, as per para 4,4.0. of the impugned Transfer Policy, he was required to complete at least one tenure continuously as Officer in one of the branches/offices located in South other than his home State. As per the Transfer Policy, Maharashtra also falls under the definition of “South”. The petitioner’s home State is Karnataka. Admittedly, the petitioner has not served in the South for a full tenure being of four years continuously as Officer in South. Therefore, no fault can be found with the impugned order of his transfer to a branch of the Bank in Maharashtra.
49. Subject to the said observations, the writ petitions are allowed in part but without any order as to costs.