IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 23/10/2003
CORAM
THE HONOURABLE MR.JUSTICE P.K.MISRA
AND
THE HONOURABLE MR.JUSTICE F.M.IBRAHIM KALIFULLA
WRIT PETITION NO.10727 OF 2003
AND W.P.NOS. 10728, 10730
11919 to 11921, 11565 to 11567,11899,
11900, 11902, 11935 to 11937, 12367 to 12369,
12370 to 12372, 12007, 12008, 12010, 12349, 12351,
12353, 12519, 12520, and 12522 OF 2003
AND
W.P.M.P.NOS.13553, 13554, 13556, 14943 to 14945,
14542 to 14544, 14926, 14927, 14929, 14962 to 14967,
15537 to 15542, 15543 to 15548, 15058, 15059,
15061, 15513, 15514, 15516, 15517, 15690 to 15693,
15696 and 15697 OF 2003
W.P.NO.10727 OF 2003:
Bhaarathiya Electricity Employees Federation
(Regn.No.990/SLM)
affiliated to Bharatiya Mazdoor Sangh (BMS),
represented by General Secretary,
R.Murali Krishnan .. Petitioner
-Vs-
1. The Management,
Tamil Nadu Electricity Board,
represented by its Secretary,
N.P.K.R.R.Maaligai,
Electricity Avenue,
Anna Salai, Chennai-2.
2. The Government of Tail Nadu,
represented by its Development Commisisioner &
Secretary,
Finance (Pensions) Department,
Fort St.George,
Chennai-9. .. Respondents
For Petitioner : Mr.K.Chandru, SC
for Mr.R.Yashod Vardhan
Mr.S.Doraisamy
Ms.R.Vaigai
Mr.R.Viduthalai
Mr.N.G.R.Prasad, SC
M/s.Row & Reddy
Mr.R.Thiagarajan, SC
For Respondents : Mr.R.Muthukumaraswamy
Addl.Advocate General
assisted by Mr.S.T.S.Murthy,SplGP
:COMMON ORDER
F.M.IBRAHIM KALIFULLA, J.
The Challenge in these Writ Petitions is to the Proceedings of
the Tamil Nadu Electricity Board in (Per) B.P.(Ch.) Nos.64, 65 and 66 ( SB)
dated 31-3-2003.
2. In (Per) B.P.Ch.No.64, the Tamil Nadu Electricity Board,
by virtue of the provisions of the Tamil Nadu Pension Rules 1978, which
according to it, was applicable to the employees of the Tamil Nadu Electricity
Board, it became necessary to adopt the orders relating to Government
Pensioners to the Pensioners of the Tamil Nadu Electricity Board, that by
G.O.No.71 dated 19-3-2003 of the State Government, the qualifying service to
earn full pension having been enhanced from 30 years to 33 years, the same
enhancement is also made applicable to the employees of the Board after
retirement to become eligible to earn full pension. For the same reasoning,
the Board also directed that pension would be determined on the average
emoluments drawn during the last 10 months service alone. Following the
direction in G.O.No.71 dated 19-3-2003, the above said Board proceedings were
also made applicable from 1-4-2003.
3. Similarly, in (Per) B.P.Ch.No.65, dated 31-3-2003 the
Tamil Nadu Electricity Board enhanced the discount rate of commutation from 4%
to 8% inconsonance with the G.O. No.73 dated 19-3-2003. Likewise in (Per)
B.P.No.66 dated 31-3-2003, the maximum limit for commutation of the portion of
the pension by the pensioner was also restricted to 33.1/3% by following
G.O.No.74 dated 19-3-2003.
4. In fact, in (Per)B.P.Ch.No.67, dated 31-3-2003, the Tamil
Nadu Electricity Board, by following G.O.No.75 dated 19-3-2003, directed that
payment of Gratuity at the time of retirement would be made 50% by way of cash
and 50% by way of Small Savings Certificate or National Savings Certificate
(Plan VIII-Issues) issued on or after 1-4-2003. However, it is stated that as
the said G.O.75 itself came to be subsequently withdrawn in G.O.No.218 dated
26-7-2003, the said (Per) B. P.Ch.No.67 dated 31-3-2003 was not brought into
effect.
5. At the outset, it will have to be stated that since all
the impugned Proceedings came to be issued based on the corresponding
Government Orders, testing the validity of the impugned proceedings depend
upon the corresponding G.Os., based on which the Proceedings came to be
issued. It is also relevant to mention that the said Government Orders
themselves were under Challenge in a batch of Writ Petitions in W.P.Nos.11228
of 2003 etc., in which, we have rendered our Judgment dated 23-4-2003 wherein,
while upholding G.O.No.71 and 74 dated 19-3-2 003, we have set aside G.O.No.73
dated 19-3-2003.
6. On behalf of the petitioners, submissions were made by
Mr.R. Thiagarajan, Senior counsel, Mr.K.Chandru,Senior counsel, Mr.N.G.R.
Prasad, Miss.R.Vaigai and R.Viduthalai. The respondent Board was represented
by the learned Addl.Advocate General.
7. Mr.N.G.R.Prasad, learned counsel in his submissions,
contended that the Electricity Board being a statutory body, it has got its
own independent existence, therefore, what applies to the government employees
does not automatically apply to the employees of the Board and therefore,
merely by adopting the Government Orders, the Board cannot contend that it
need not follow the provisions contained under the Industrial Disputes Act in
particular Section 9(A) of the Act. According to the learned counsel,
Regulation 9 of the Tamil Nadu Electricity Board Liberalised Pension
Regulations 1960 hereinafter called ‘the Pension Regulations’, which, is the
saving provision, which provides that those regulations are not in derogation
of the provisions of the civil service regulations applicable to the
Government employees will not take away the effect of Section 9(A) of the
Industrial Disputes Act. According to the learned counsel, the Pension
Regulations themselves will not apply to the Electricity Board employees who
were governed by the existing contract prevailing between the Board and its
employees. The learned Senior counsel would further contend that when Section
9(A) of the Industrial Disputes Act is applicable to the employees of the
Board, without giving an appropriate notice under the said provision, the
impugned Proceedings can not be given effect to. It was next contended that
in any event, the Chairman was not competent to issue the Proceedings on
behalf of the Board. Further, according to the learned counsel as the issues
relate to service matters, it cannot be held that the Board is bound to follow
the directives of the State Government in exercise of the powers under Section
78(A) of the Electricity (Supply) Act 1948 which only talks of policy matters.
One other contention of the learned counsel was that by virtue of Regulation
17(g) as well as, Explanation V (gg)(i) to Regulation 17 of the Tamil Nadu
Electricity Board Service Regulations, hereinafter called ‘the Service
Regulations’, when provisions have been made as to how retirement is to take
effect and an employee would qualify for pension after completion of 20 years
of service, even the Pension Regulations will have no effect inasmuch as, the
Service Regulations have been framed by virtue of the powers vested with the
Board under 79( c) of the Electricity Supply Act 1948. The learned Senior
counsel relied upon an unreported judgment of the learned Single Judge
rendered in W.P.No.11398 dated 22-12-1994 which was also confirmed in W.A.No.1
53 of 1995, dated 21-7-1997, as well as, the Division Bench Judgment in
W.A.No.138 of 1960 dated 15-12-1960. Reliance was also placed upon 1968
Kerala 76 (A.M.MANI versus KERALA STATE ELECTRICITY BOARD REP. BY ITS
SECRETARY, TRIVANDRUM & OTHERS).
8. Mr.K.Chandru, learned Senior Counsel appearing for the
petitioners in W.P.No.11919 to 11921, fairly stated that by virtue of the
settlement between the Board and its employees and the clauses in the
settlement specifically provide that the revised pension scheme of the Tamil
Nadu Government and any amendments thereon from time to time would apply to
the pensioners of the Tamil Nadu Electricity Board, there is no scope to still
contend that Section 9(A) should be complied with by the Board before
introducing any change in relation to pensionary benefits. According to the
learned Senior counsel, by virtue of Proviso (A) of Section 9 of the
Industrial Disputes Act, the Tamil Nadu Electricity Board need not issue any
notice before introducing any change in the pensionary benefits when the
changes are brought out by the State Government. The learned senior counsel,
however, contended that the Proceedings are liable to be set aside on the
ground that there was non application of mind and inasmuch as the Board’s
audited Budget provisions make it clear that funds have been duly allocated
for Gratuity and Pension based on the pensionary provisions and in the
circumstances, the mechanical adoption of the Government Orders without
reference to the Board’s financial position would render the impugned
Proceedings invalid.
9. Ms.R.Vaigai, learned counsel appearing for the petitioners
in W.P.Nos.11899 to 11902, in her submissions, relied upon the judgments
reported in 1983(1) SCC 305 (D.S.NAKARA AND OTHERS versus UNION OF INDIA),
1997 (6) SCC 7 (K.L.RATHEE versus UNION OF INDIA), 1996(2) LLJ 1 127
(SECRETARY, (ESTT.) RAILWAY BOARD versus D.FRANCIS PAUL, ETC.), 1 984(3) SCC
281 (EX.CAPT.K,C.ARORA & ANOTHER STATE OF HARYANA & OTHERS), 1978(2) SCC 50
(MADAN MOHAN PATHAK versus UNION OF INDIA), 1989(3 ) SCC 132 (MARATHWADA
UNIVERSITY versus SESHRAO BALWANT RAO CHAVAN) and 1955 SC 188 (GANAPATHI
SINGHJI versus STATE OF AJMER) and contended that in the light of the broad
principles set out in the Judgment of the Hon’ble Supreme Court in the case of
‘D.S.Nakara’,reported in 1 983(1) SCC 305 (cited supra), pensioners will have
to be treated as a class and it will have to be held that they have acquired
their rights by virtue of long service rendered with the Board and that by the
impugned Proceedings as between a Class of Pensioners, two different yard
sticks cannot be applied. According to the learned counsel, though it may be
open for the Board to seek for introduction of such new conditions and
applying them to those who enter into service after 1 -4-2003, the same cannot
be imposed on the existing employees who entered into service prior to that
date. The learned counsel further contended that when the Board itself was
not empowered to delegate its powers to the Chairman, the Chairman had no
jurisdiction to issue the impugned Proceedings by merely relying upon the so
called delegation of powers in B.P.Ch.Nos.1084 dated 28-6-1979. It was
further contended that by virtue of Section 6(A) and 17(A)(A) of the Employes
Provident Funds and Miscellaneous Provisions Act, read with Section 13(B) in
respect of the exempted schemes, without obtaining the approval of the Central
Government, no change can be effected.
10. Mr.R.Viduthalai, learned counsel appearing for the
petitioners in W.P.Nos.11935 to 11937 of 2003, etc., contended that apart from
total non application of mind, while adopting the Government Orders, there was
no scope for the Board to merely rely upon the Government Order while making a
change in the pension provision without necessary amendment to Rule 9 of the
Pension Regulations. According to the learned counsel, the financial
unsustainability which weighed with the State Government will not apply in
view of the Board’s financial position. In such circumstances, there being
violation of Article 14 of the Constitution, the impugned Proceedings are
liable to be set aside.
11. Mr.R.Thiagarajan, learned Senior counsel appearing for
the petitioners in W.P.No.12519 to 12520 of 2003, etc., by relying upon AIR
1986 SC 515 (INDIAN EXPRESS NEWSPAPERS (BOMBAY) PRIVATE LTD. AND OTHERS ETC.,
ETC. versus UNION OF INDIA & OTHERS) and by referring to additional affidavit
filed on behalf of the petitioners, pointed out that as many as 369 members of
that petitioner association alone completed 30 years of service on 31-3-2003,
and therefore, the impugned proceedings must be held to be suffering from the
test laid down in the above said Judgment in order to be interfered with in
that Writ Petition.
12. As against the above submissions made on behalf of the
petitioners, the learned Additional Advocate General contended that by (Per)
B.P.Ms.(FB)No.5 dated 26-6-1986 of the employees of the Tamil Nadu Electricity
Board have now been brought under the Pension Scheme governed by the Tamil
Nadu Electricity Board Employees Pension Rules, that by Permanent B.P.(FB)
No.7 dated 17-2-1995, the Saving Clause in Clause 9 of the Pension Regulations
have also been suitably amended providing that instead of Civil Services
Regulations, the Tamil Nadu Pension Rules 1978 would be applicable, therefore,
the Tamil Nadu Electricity Board Liberalised Pension Regulations 1960 is in
addition to the Tamil Nadu Pension Rules, 1978 and therefore, by virtue of the
existing regulations in regard to Pension Provisions applicable to the
employees of the Board, when the Tamil Nadu Pension Rules are straight away
applicable irrespective of the impugned B.Ps., the employees of the Board are
bound by whatever change or amendment brought to the Tamil Nadu Pension Rules
and therefore, the implementation of G.O.No.71 , 73 and 74 dated 19-3-2003 to
the employees of the Electricity Board governed by the Tamil Nadu Electricity
Liberalised Pension Regulations cannot be called in question. As regards the
contention based on Section 9(A) of the Industrial Disputes Act, the learned
Addl. Advocate General contended that by virtue of the Clause in the
settlement dated 8-7-1998 to which all the existing unions including the
petitioner unions are signatory to the said settlement, there is no scope to
invoke Section 9(A) of the Industrial Disputes Act. He also contended that in
any event since the changes which were sought to be introduced under the
impugned Proceedings do not fall under any of the items in the Schedule IV of
the Industrial Disputes Act, Section 9(A) will have no application.
13. As regards the contention based on lack of necessary
delegation available to the Chairman of the Board to issue the impugned
Proceedings, according to the learned Addl.Advocate General, the impugned
Proceedings were only communicated for implementation of the relevant G.Os.
in G.O.No.71, 73 and 74 which have brought out the consequential changes in
the Pension Regulations and therefore, communication of the same by the
Chairman cannot be faulted. According to the learned Addl.Advocate General,
even in the year 1996 when maximum eligibility of 33 years for earning full
pension was brought down to 30 years, on that occasion also, it was only
communicated by the Chairman. By referring to para 7 of the counter
affidavit, the learned Addl. Advocate General contended that the loss
incurred by the Board during 2001-2 002 and 2002-2003 being of the order of
Rs.2201.78 and 1554.74 Crores respectively, it cannot be held that there was
non application of mind and that it was arbitrary or unreasonable to implement
the above said G.Os. The learned Addl.Advocate General relied upon 1993(4)
SCC 62 (STATE OF WEST BENGAL AND OTHERS versus RATAN BEHARI DEY AND OTHERS) in
support of his contention that the specification of cut of date, viz.,
1-4-2003 was reasonably fixed by the State Government and therefore, on that
ground it cannot be held that the same cannot be made applicable to the
existing employees who are to retire after 1-4-200 3. The learned
Addl.Advocate General further contended that by applying the dictum of the
Hon’ble Supreme Court in ‘Nagaraj’s case’ reported in AIR 1985 SCC 551, it
will have to be held that the changes brought out were all reasonable and
cannot be held to be arbitrary exercise of power or irrational in order to be
interfered with.
14. Having heard the learned counsel appearing for the
respective parties in this batch of Writ Petitions, which relate to the
employees of the Tamil Nadu Electricity Board, the question for consideration
is whether the import of the changes brought out by the State Government by
G.O.Nos.71, 73 and 74 can be made applicable by virtue of Regulation 9 of the
Tamil Nadu Electricity Board Liberalised Pension Regulations, without anything
more. If our answer to that question is in the affirmative, then all the
other contentions of the petitioners would automatically fall to the ground.
15. However, before adverting to the above said question, we
want to steer clear of the very validity of the concerned G.Os. with
reference to which we have made a detailed discussion in our order dated 2
3-10-2003 in the batch of the Writ Petitions in W.P.Nos.11228 of 2003 , etc.,
wherein, the said G.Os. came to be challenged. In the said order, we have
reached a conclusion that G.O.Nos. 71 and 74 dated 19-3 -2003 are valid and
accordingly, we have upheld the said G.Os. As far as G.O.No.73 dated
19-3-2003, we have held that the said G.O. was arbitrary and irrational and
therefore, the same was liable to be set aside. Inasmuch as, we have set
aside G.O.No.73 dated 19-3-2003, the corresponding (Per)B.P.Ch.No.65 dated
31-3-2003 cannot also stand. Therefore, irrespective of the question as to
the validity of the impugned B.P.Ch.No.65 dated 31-3-2003, as the very
G.O.No.73 dated 19-3-2003 which was sought to be implemented under the present
B.P.No.65 itself has been set aside, we are of the considered view that there
is no point in unnecessarily deliberating on the details of the above said
impugned (Per)B.P.No.65, and we hold that the said (Per)B.P.Ch. No.65, dated
31-3-2003 can not stand the scrutiny of this Court for the simple reason that
the very basis of the issuance of the said B.P., viz., G.O.No.73 dated
19-3-2003 itself having been set aside by this Court in W.P.Nos.11228, 18906,
18907 and 11666 of 2003.
16. As far as the other Board Proceedings are concerned, the
main Challenge to the above said Board Proceedings are, in the first place,
the said Board Proceedings came to be issued in violation of Section 9(A) of
the Industrial Disputes Act. To buttress the said argument, reliance was
placed upon the settlement dated 8-7-1998. It is not in dispute that the
employees of the Board are governed by the provisions of the Industrial
Disputes Act and the various Unions representing the employees are signatory
to the said settlement. Clause 15(iii) of the said settlement is in the
following terms.
” The revised pension schemes of the Government of Tamil Nadu and any
amendments thereon from time to time will be applied to the pensioners of the
Tamil Nadu Electricity Board”
17. Proviso (a) to Section 9(A) of the Industrial Disputes Act, makes
it clear that where the change in the conditions of the service applicable to
any workman in respect of any matter specified in the IV Schedule is effected
in pursuance of any settlement or award, no notice under Section 9(A) is
required. Though the learned Addl.Advocate General would attempt to contend
that the changes brought out to the pensionary benefits are not one of the
items covered by Schedule IV of the Industrial Disputes Act, we are afraid
that the said stand may not be acceptable in view of the fact that very Item
No.2 in the IV Schedule talks of pensionary benefits. However, it cannot be
disputed that Clause 15(iii) of the Settlement dated 8-7-1998 specifically
provides that the revised Pension Scheme of the Government employees and any
amendments thereof from time to time can be straight away applied to the
pensioners of the Tamil Nadu Electricity Board. In view of our conclusion
based on Clause (a) to the proviso to Section 9(A) of the Act, we do not find
any scope to consider the submissions made on Sub Clause (b) of the said
proviso.
18. Having regard to B.P.Ms.(FB) No.5 dated 26-6-1986, all
the employees of the Electricity Board have been brought under the Pension
Scheme covered by the provisions of the Tamil Nadu Electricity Board
Liberalised Pension Regulations 1960. In such circumstances, when by
G.O.Nos.71 and 74 dated 19-3-2003 certain amendments were introduced to the
pension provisions of the employees of the State Government, by virtue of
Clause 15(iii) of the settlement dated 8-7-1998, the enforcement of the same
in respect of the employees of the Tamil Nadu Electricity Board becomes
automatic. In fact, it will have to be held that mere communication to that
effect would be sufficient to implement any such amendments brought out by the
State Government in respect of pension benefits brought by it to its employees
in order to be made applicable to the employees of the Tamil Nadu Electricity
Board. Further more, we are convinced that Tamil Nadu Electricity Board
Liberalised Pension Regulations having brought into effect and Regulation 9
when specifically provides that the other Regulations are in addition to the
Tamil Nadu Pension Rules and not in derogation thereof, it is axiomatic that
so long as the present changes brought out in G.O. No.71 and 73 dated
19-3-2003 are not in derogation of the Tamil Nadu Electricity Board Pension
Regulations, such amendments brought out in the Tamil Nadu Pension Rules would
automatically become part of the said Regulations. In the light of the
subsequent B.P.(FB) No.7 dated 1 7-2-1995, there is no scope to contend that
what was contemplated in the erstwhile regulation No.9 of the Tamil Nadu
Electricity Board Liberalised Pension Regulations was only Civil Service
Regulations and not Tamil Nadu Pension Rules 1978.
19. As regards the submission based on Tamil Nadu Electricity
Board Service Regulations 17(g) and 17(v)(gg)(i), it will have to be stated
that the same do not provide for payment of pension or any other benefits to
the employees of the Board. Those service regulations by themselves do not
prescribe the various stipulations relating to the payment of pension or the
other allied matters. On the other hand, it cannot be disputed that payment
of pension in respect of the employees of the Board is governed by the Pension
Regulations. In fact, it is nobody’s case that payment of pension in the
Electricity Board and the pension regulations are covered by the provisions of
the Tamil Nadu Electricity Board Service Regulations. In such circumstances,
the argument based on the said Regulation 17(g) and 17(v)(gg)(i) of the Tamil
Nadu Electricity Board Service Regulations to thwart the provisions of the
Tamil Nadu Electricity Board Liberalised Pension Regulations cannot also be
accepted. Therefore, by virtue of Regulation 9 of the Pension Regulations and
Clause 15(iii) of the settlement dated 8-7-1998, the import of the amendments
brought out in G.O.No.71, 73 and 74 became part of the regulations governing
the payment of pension in respect of employees of the respondent Board. As
rightly contended by the learned Addl.Advocate General, by the impugned B.Ps.,
the second respondent, namely, the Chairman of the Tamil Nadu Electricity
Board is not attempting to introduce any change in the service Regulations or
in the Pension Regulations, but only communicating the effect of the changes
brought out to the Pension Regulations of the Electricity Board employees by
virtue of the amendments brought out to the Tamil Nadu Pension Rules pursuant
to G.O.Nos.71, 73 and 74 dated 19-3-2003. Therefore, the other argument based
on the validity of delegation or the competence of the second respondent in
issuing the impugned B. Ps. do not merit any consideration.
20. Since we have dealt with the correctness of the
G.O.Nos.71, 73 and 74 dated 19-3-2003 in the other batch of Writ Petitions
covered by our order dated 23-10-2003 in W.P.No.11228 of 2003, etc., we adopt
the said reasoning while upholding the above said G.O.Nos.71 and 74 dated
19-3-2003 and for setting aside the G.O.No.73 dated 19-3-2003. We therefore,
do not propose to go into the details of the other submissions which touch
upon the correctness of the validity of those G. Os.
21. As a sequel to our above said conclusion, we uphold (Per) B.P.
Ch.Nos.64 and 66 dated 31-3-2003 and set aside (Per) B.P.Ch.No.65 dated
31-3-2003. Accordingly, the Writ Petitions in W.P.Nos.10730, 11566, 11920,
11902, 12010, 12352, 12368, 12367, 12369, and 12520 of 2003 are allowed; and
10727, 10728, 11565, 11567, 11899, 11900, 11919, 1192 1, 11935, 11936, 11937,
12007, 12008, 12349, 12351, 12370, 12371, 123 72, 12519, 12522 of 2003 are
dismissed.
In the circumstances of the case, we make no order as to costs.
Consequently, all the connected W.P.M.Ps. are closed.
Index: Yes
Internet: Yes
To
1. The Management,
Tamil Nadu Electricity Board,
represented by its Secretary,
N.P.K.R.R.Maaligai,
Electricity Avenue,
Anna Salai, Chennai-2.
1. The Development Commisisioner &
Secretary,
The Government of Tail Nadu,
Finance (Pensions) Department,
Fort St.George,
Chennai-9.