JUDGMENT
1. Whether a company is justified in withholding the retirement benefits of its ex-employee on the ground that the employee is withholding the possession of the company’s flat which was allotted to him as a prerequisite of his service condition is the short question that arise for determination in the present notice of motion.
2. The plaintiff, who was in the employment of the defendants, retired with effect from 11th February, 1987. It is undisputed that the plaintiff is governed by the Retirement Benefits Scheme for the Management Grade Officers. During the tenure of his service, the plaintiff was allotted a flat which the company under a lease agreement dated 26th July, 1986, had obtained from its landlord, one U. T. Daswani. The defendant was permitted to reside in the said flat as a condition of his service. The rent in respect of the said flat was paid by the company to the said Daswani. After the plaintiff retired, correspondence ensued wherein the company demanded back the possession of the flat and plaintiff contended that it was he who had obtained the said flat on lease from the landlord. According to the plaintiff, it was only for obtaining certain tax benefits that the lease agreement was entered into between the company and the landlord and it was specifically agreed that on his retirement the lease would be transferred in his favour. It is true that this contention was taken by the plaintiff for the first time in the correspondence that ensued after his retirement. The question, however, is whether the company would be justified in withholding the retirement benefits of the plaintiff on the ground that the plaintiff is withholding the possession of the company’s flat. Reliance is placed by Mr. Tulzapurkar on Articles 10 of the Retirement Benefits Scheme for Management Grade Offices of the defendant company. It provides as under :
“Withdrawal of benefits payable under the Retirement Benefits Scheme – Notwithstanding any other provisions of this scheme, the benefits paid under this scheme will be withdrawn if the beneficiary jeopardizes or interferes with the essential interests of the company by committiong any of the following acts :
(a) Conducts or engages in any business activities which are similar to those carried on by the company or in which the company is engaged, without obtaining prior approval of the company;
(b) is guilty of theft or fraud in respect of properties or business of the company;
(c) commits any act which is punishable under the Indian Penal Code, in dealing with the company;
(d) commits any act in contravention of the provisions of Article 9 of this Scheme.
Before taking action under this clause the company shall call upon the beneficiary by notice in writing to show cause why the benefits should not withdrawn. The decision of the company, however, will be final and binding.”
3. It is pointed out by Mr. Tulzapurkar by making a reference to the correspondence which caused after the retirement and before filling of the suit that the company had given notice as required under the above Article. The plaintiff was given adequate opportunity and the company had thereafter proceeded to withdraw the benefits due to the plaintiff under the Scheme. According to] Mr. Tulzapurkar, the plaintiff is guilty of theft or fraud in respect of the properties of the company, and is, therefore, liable under sub-clause (b) of Article 10. The plaintiff has also committed an act which is punishable under Section 408 of the Indian Penal Code. In fact, a prosecution has been duly launched by the company against the plaintiff under Section 408 of the Indian Penal Code and Section 630 of the Companies Act and the same is pending. Hence, the plaintiff is liable also under clause (c) of the said Article. According to Mr. Tulzapurkar, the claim set up by the plaintiff in respect of the company’s flat is belated, dishonest and mala fide. He submitted that the plaintiff in the suite would at best be entitled to a money decree. It is nowhere suggested that the company is not good for the money in the event a decree is passed in favour of the plaintiff. What the plaintiff is seeking by the present notice of motion is the reliefs claimed in the suit. The plaintiff in view of his conduct of withholding the company’s flat by raising dishonest and false pleas is not entitled to any discretionary relief claimed in the notice of motion. Reliance was placed on an unreported judgment in the case of Kareparambil Theyyan Lakshmanan v. Air India (Writ Petition No. 2101 of 1984), decided by my learned brother Pendse, J., on the 10th January, 1986, wherein the extraordinary writ jurisdiction was refused in favour of an employee who was placed in circumstances similar to the one arising in the present suit.
4. In any judgment, it would not be open to a company to confuse the issue of their claim to receive back the possession of the company’s flat with the claim of the company to receive retirement benefit. In case the plaintiff is unlawfully holding the possession of the company’s flat, it is open the company to resort to proceedings for taking back the possession which the company has done. In case the plaintiff is found guilty of committing offence he will be punished. Pending such proceedings, in my view, it would not be open or just for the company to withhold the retirement benefits from its ex-employee. Whether the action on the part of the company in withdrawing the retirement benefits in terms of Article 10 of the Retirement Benefits Scheme of the company is an issue which will undoubtedly arise in the suit. Whether the case of the plaintiff that the flat was taken on lease by him but was merely shown as having been taken by company for the purpose of providing tax benefits to the plaintiff would also issues which would arise in the suit. Pending the decision of the said issues, it would be unjust to deprive the plaintiff of his pensionary benefits as the entire livelihood of the plaintiff would depend upon it.
5. In my view, the decision of Kareparamil Theyyan Lakshmanan v. Air India, cannot come to the aid of the defendants inasmuch as the said case dealt with an exercise of the extraordinary writ jurisdiction. The plaintiff in the present case has filed a suit. The considerations which weigh in a suit are entirely different from those that arise in a writ petition. It has further to be noted that a decision of a single judge of the Karnataka High Court delivered on 5th April 1984, in Writ petitions Nos. 6269 to 6294 of 1984 had found favour with my learned brother Pendse, J. In that case, it was held that the amount of gratuity could not be withheld even if the workman after his retirement or resignation refused to vacate the premises allotted while in employment. In the present case, there is no dispute between the parties in regard to the amount that the plaintiff would be entitled to by way of pension if the same was not to be deprived in exercise of the power conferred by Article 10 of the Retirement Benefits Scheme. The defendants have informed the plaintiff of the amounts which would otherwise be payable to the plaintiff.
6. Pension is an incidence of service which an employee earns after a life-long service rendered to the company. The said right cannot be lightly frittered away as the very livelihood of the employee depends upon receiving his retirement benefits. In my judgment, the plaintiff has made out a strong prima facie case for the grant of the reliefs claimed in the notice of motion. It would be in the interest of justice to direct the defendants to deposit in court the amount of pension due and payable to the plaintiff. It would be open the plaintiff to withdraw the same on furnishing security to the satisfaction of the prothonotary and Senior Master. This would ensure both the livelihood of the plaintiff as also the interest of the company in the event of the plaintiff failing in the suit.
7. I direct the defendants to deposit the pension due to the plaintiff with effect from the date of his retirement up to date within four weeks from today and to continue to deposit the same every month as and when the same becomes due and payable to the plaintiff. On deposit being made the plaintiff will be liberty to withdraw the same on furnishing adequate security to the satisfaction of the prothonotary.
8. The notice of motion is made absolute in the above terms.
9. Costs of the notice of motion will be the costs in the suit.
10. On the application of Mr. Tulzapurkar learned counsel appearing for the defendants, my order is stayed for a period of four weeks from today.