{"id":174733,"date":"1997-01-27T00:00:00","date_gmt":"1997-01-26T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/hindustan-machines-tools-ltd-vs-m-s-kangp-n-kashyap-on-27-january-1997"},"modified":"2015-06-26T03:54:32","modified_gmt":"2015-06-25T22:24:32","slug":"hindustan-machines-tools-ltd-vs-m-s-kangp-n-kashyap-on-27-january-1997","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/hindustan-machines-tools-ltd-vs-m-s-kangp-n-kashyap-on-27-january-1997","title":{"rendered":"Hindustan Machines Tools Ltd. & … vs M.S. Kang\/P.N. Kashyap on 27 January, 1997"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Hindustan Machines Tools Ltd. & … vs M.S. Kang\/P.N. Kashyap on 27 January, 1997<\/div>\n
Bench: K. Ramaswamy, G.T. Nanavati<\/div>\n
           PETITIONER:\nHINDUSTAN MACHINES TOOLS LTD. & ANR.\n\n\tVs.\n\nRESPONDENT:\nM.S. KANG\/P.N. KASHYAP\n\nDATE OF JUDGMENT:\t27\/01\/1997\n\nBENCH:\nK. RAMASWAMY, G.T. NANAVATI\n\n\n\n\nACT:\n\n\n\nHEADNOTE:\n\n\n\nJUDGMENT:\n<\/pre>\n
\t\t\t    WITH
\n\t\tCIVIL APPEAL NO. 627 OF 1997
\n\t (Arising out of SLP (C) No. 20470 of 1996)
\n\t\t\t O R D E R
\n     Leave granted.\n<\/p>\n
     These appeals  by special leave arise from the judgment
\nof the\tHigh court of Punjab & Haryana, made on 19.4.1996 in
\nLPA Nos.2 and 3 of 1996.\n<\/p>\n
     The  admitted   facts  are\t that  the  appellants\thave
\nformulated  a\tScheme\tfor   voluntary\t retirement  of\t the
\nemployees who have completed 45 years of age, effective from
\nApril 1,  1989 for  a period  of three months subject to the
\nconditions specified  in the  scheme.  The  respondents\t had
\naccepted the  scheme and  retired thereunder.  Thereafter by
\nOffice Order  No.45\/90 dated  March 1,\t1991 pay scales were
\nrevised in  respect of\texisting  employees  and  those\t who
\nretired from  time to  time.  In  furtherance  thereof,\t the
\nrespondents claimed  and revision  of the  scale of  pay was
\nsought to  be given  effect by\tthe  office  but  the  audit
\nobjection to  the payment  thereof was raised. Consequently,
\nthe respondents\t filed the  writ petitions in the High Court
\nand the\t learned single\t Judge allowed the writ petition and
\nappeals were  dismissed.  Thus,\t these\tappeals\t by  special
\nleave.\n<\/p>\n
     Shri V.  Reddy, learned  Additional Solicitor  General,
\ncontends that  the Scheme is a special scheme containing the
\nmode of\t payment of  compensation as  calculated in terms of
\nthe Scheme.  There is  a distinction between those employees
\nwho retired  voluntarily under\tthe Conduct  discipline\t and
\nAppeal Rules  and those\t who retired  under the\t Scheme. The
\nrevised scales\tof pay\tare applicable\tto those persons who
\nare  enumerated\t  in  Clause  2.2.2  of\t the  office  orders
\nproviding for  Revision of  Pay\t Scales.  Proceedings  dated
\nmarch  1,   1991  refers   to  the  candidates\twho  retired
\nvoluntarily. Under Rule 24.2. of the Conduct, Discipline and
\nAppeal Rules,  the revision  of the  Provident Fund would be
\neffected only  in respect  of those  employees\twho  retired
\nunder the  special scheme; the scale and gratuity have to be
\nrevised in  terms of  the revised  scales of pay but not the
\npayment of  the difference  of pay.  On the other hand, Shri
\nManoj Swarup,  learned counsel for the respondents, contends
\nthat no\t distinction has been drawn in the proceedings dated
\nMarch 1,  1991 between\tthe employees  who retired under the
\nConduct, Discipline  and Appeal\t Rules or  under the Special
\nScheme and  those who  retired voluntarily  under the Scheme
\nand are\t entitled to the same benefit of the revision of the
\npay scales  as contemplated  under the\tOfficer Order  dated
\nMarch 1,  1991.\t He  also  contends  that  even\t clause\t 2.3
\nnegatively puts\t that they  are disentitled  to the payment.
\nThe word `salary’ is linked to the other components, namely,
\nadditional dearness  allowance, ad  hoc pay,  additional pay
\netc. Therefore,\t the word  `pay’ would\tinclude revised pay.
\nThereby the  respondents are  entitled to the benefit of the
\nrevised pay scales.\n<\/p>\n
     In support\t thereof, he placed reliance on the judgment
\nof this\t Court in Prantiya Vidhyut Mandal Mazdoor Federation
\n& Ors.\tvs. Rajasthan State Electricity Board & Ors. [(1992)
\n2 SCC  723]. Therein the dispute relating to the revision of
\nthe pay\t was pending before the Industrial Tribunal. Pending
\ndispute, the  wages were  revised. Consequently,  after\t the
\naward was  made, the revision of the wages was effected. The
\nquestion was:  whether the  P.F.  was  required\t to  be\t re-
\ncalculated on  the basis  of the  revised scales? This Court
\nhad held that in view of the revision of the pay scales, the
\nP.F. requires  to be  decided on  the basis  of the  revised
\nwages payable  to the  employees as  was  recalculated.\t The
\nratio therein  has no  application to  the  facts  in  these
\ncases.\n<\/p>\n
     The question,  therefore, is:  whether the\t respondents
\nare entitled  to the  benefit of  the revised  scales of pay
\nunder the  Office Order\t No.45\/90 dated march 1, 1991? It is
\nnot in\tdispute that  the respondents  have not completed 50
\nyears of  age for  voluntary retirement\t under clause (b) or
\nclause\t(c)   of  Rule\t 24.2  on   attaining  the   age  of
\nsuperannuation. They contemplate thus:\n<\/p>\n
     “(b) An  employee may  at any  time
\n     after  completing\tthe  age  of  50
\n     years voluntarily\tretire by giving
\n     one month’s notice in writing.”\n<\/p><\/blockquote>\n
     (c)  The  Competent  Authority  may
\n     also retire an employee at any time
\n     after  he\tcompletes  50  years  by
\n     giving one\t month’s notice\t or  one
\n     month’s salary\/wages in lieu of the
\n     notice, if\t it is considered in the
\n     interest of the Company.”<\/p><\/blockquote>\n
     Thus, an employee who is normally entitled to remain in
\nservice until  he reaches  the age  of superannuation  of 58
\nyears, is  entitled to\tretire either  voluntarily by giving
\none month’s  notice on attaining the age of 50 years and the
\nCompany may,  if it  considers it necessary, in the interest
\nof the\tCompany, retire\t an employee  by giving\t one month’s
\nnotice or  one month’s\tsalary\/wages in\t lieu thereof. Thus,
\nthose who retired under the above Rule would be construed to
\nhave voluntarily  retired from\tservice. It  is seen  that a
\nspecial voluntary  retirement scheme  had been introduced by
\nthe Company.  The  objective  of  the  Voluntary  Retirement
\nScheme is  to achieve the optimum level of manpower with the
\ndesirable average  age-mix as  par the changing needs of the
\nCompany. In  regard to\tthe respondents, they come under the
\nScheme `B’  which contains  that the scheme is applicable to
\nall regular\/permanent  employees of  the Company as notified
\nfrom time  to time  who have  put in  15 years of service or
\nmore in\t the Company  and who are of the age of 45 years and
\nabove as  on the  date of  the submission of the application
\nfor voluntary retirement.\n<\/p>\n
     It is,  thus, seen\t that there is a distinction between
\nthe employees  who retire  under the Conduct, Discipline and
\nAppeal Rules  on attaining  the age  of\t 50  years  and\t the
\nemployees who  accept voluntary\t retirement on completion of
\n15 years  of service  or more  in the Company and who are of
\nthe age\t of 45\tyears and  above.  In  other  words,  before
\nattaining the  age of  50 years\t as contemplated  under\t the
\nConduct,  Discipline   and  Appeal   Rules,   the   benefits
\nenumerated for\tsuch of\t the employees who opt for and where
\noption is  accepted by the Company, are postulated in Clause\n<\/p>\n
(b) of\tScheme `B’  which says\tthat the  eligible employees
\nrequesting for\tvoluntary retirement,  subject to acceptance
\nof their  requests by the Company\/Competent Authority, shall
\nbe entitled  to receive\t benefits at the following rates for
\nthe remaining  period  of  service  prior  to  the  date  of
\nretirement  on\t superannuation\t from  the  service  of\t the
\nCompany. The  computation thereof has been anumerated in the
\nscheme which reads as under:\n<\/p>\n
     “It has been decided to introduce a
\n     Voluntary Retirement Scheme for the
\n     employees of the Company as per the
\n     enclosed copy  of comprising of two
\n     parts viz.,  Scheme `A’  and Scheme
\n     `B’.  The\t scheme\t  will\t be   in
\n     operation\tfrom   1.4.1989\t for   a
\n     period of\tthree months, subject to
\n     the following further conditions:-\n<\/p><\/blockquote>\n
     i)\t  Scheme A  shall be  applicable
\n     only to the employees of Lamp Unit,
\n     Hyderabad\tin  WG\tCadre  with  the
\n     terms and\tConditions specified  in
\n     Scheme A  for  a  period  of  three
\n     months from 1.4.1989.<\/p><\/blockquote>\n
     ii)  Scheme B  shall be  applicable
\n     to\t   all\t  the\t Units\/Divisions
\n     (including\t Lamp),\t Business  Group
\n     Directorates,  other   offices  and
\n     Corporate Office with the terms and
\n     conditions\t  specified    in    the
\n     enclosed scheme,  for a  period  of
\n     three months from 1.8.1989.\n<\/p><\/blockquote>\n
     iii) The scheme does not confer any
\n     right or  any employees to have his
\n     request  for  voluntary  retirement
\n     accepted by the competent authority
\n     right  to\t accept\t or  reject  the
\n     application      for      voluntary
\n     retirement shall entirely vest with
\n     the Company.\n<\/p><\/blockquote>\n
     iv)  Acceptance of\t application for
\n     voluntary Retirement  shall  depend
\n     inter alia availability of funds in
\n     the\t\t      respective
\n     Units\/Divisions\/Business\t   Group
\n     Directorates,  other   Offices  and
\n     Corporate Officer.\n<\/p><\/blockquote>\n
     v)\t  The\t  eligible     employees
\n     requesting\t     for       voluntary
\n     retirement, subject  to  acceptance
\n     of their  requests by the competent
\n     authority shall be entitled to such
\n     benefits as  are specified\t in  the
\n     scheme.\n<\/p><\/blockquote>\n
     Such employees  may be persuaded to
\n     deposit the  benefits received,  in
\n     the Company’s Fixed Deposit Scheme.\n<\/p><\/blockquote>\n
     2.\t  The\t   existing\t medical
\n     retirement\t Scheme\t  and  Voluntary
\n     Retirement\t Scheme\t introduced  for
\n     Hyderabad\tbased\tUnits\tof   the
\n     Company  shall  stand  discontinued
\n     with the  introduction of the above
\n     Voluntary Retirement Scheme.\n<\/p><\/blockquote>\n
     3.\t  The Units and areas within the
\n     Units, where  the Scheme  could  be
\n     implemented  will\t separately   be
\n     intimated by the DPS.\n<\/p><\/blockquote>\n
     4.\t  The progress of implementation
\n     of the  Scheme with  regard to  the
\n     number of\temployees in  each cadre
\n     and  the\ttotal  amount\tpaid  on
\n     account of\t compensation  shall  be
\n     reported to DPS every month.”<\/p><\/blockquote>\n
     For the  computation of the payment of the compensation
\nin terms  of the calculation, the `Note’ postulates that the
\nsalary mentioned  under Scheme A and B shall mean basic pay,
\nDearness  Allowance,   Interim\tRelief\/ad   hoc\t Relief\t and
\nPersonal Pay,  if any,\tand shall be calculated on the basis
\nof a  calendar month.  In other\t words,\t this  contract\t has
\nexpressly omitted  to mention  the revised scale of pay from
\ntime to\t time. The  reason would be obvious. An employee who
\nretires on completing the age of 50 years but before the age
\nof 58  years, is  not entitled to the payment of any special
\ncomponent of  the salary  as indicated\thereinbefore. on the
\nother hand, he will be entitled only to the retrial benefits
\nas are\tavailable under the normal Rules. If the company, in
\npublic interest,  instead of giving one month’s notice makes
\npayment of  salary in  lieu thereof  then employee  would be
\nentitled to  nothing more  except other retrial benefit like
\npension, gratuity  etc.\t The  procedure\t in  regard  to\t the
\ncalculation of the payment of the compensation and method of
\ncomputing the compensation has been provided in Para VI; the
\ndetails whereof\t are not  material for\tthe purpose of these
\ncases.\tPara  IX  of  the  Special  Scheme  postulates\tthat
\nretirement on  medical grounds\tin terms  of clause 24.1 and
\nvoluntary retirement  in terms\tof clause 24.2(b) and (c) of
\nthe Conduct,  Discipline and  Appeal Rules  of\tthe  Company
\nshall fall  outside the\t purview of  the  scheme.  In  other
\nwords, the special scheme excluded such of the employees who
\nvoluntary retired  under Rule 24.1 or 24.2(b) and (c) of the
\nConduct, Discipline  and Appeal\t Rules of  the Company. Para
\nXII in this behalf is more relevant wherein it says that the
\nchairman and  managing director\t shall have  power to amend,
\nmodify, alter  or withdraw  the above Scheme either in whole
\nor in  part, at\t his directions,  if  the  circumstances  so
\nwarrant. In  other words, whatever components are enumerated
\nthereunder  would  be  binding\ton  the\t parties  until\t the
\nChairman and the Managing Director before acceptance amends,
\nmodified, alters or withdraws the above scheme.\n<\/p>\n
     It is  seen that  the Office Order No.45 dated March 1,
\n1991 provides that the revised pay scales shall be effective
\nfrom 1.1.1987  and will\t remain in  force for  the period of
\nfive years  upto 31.12.1991.  Clause 2.2.  provides that the
\nrevised pay  scales shall  also be  applicable on a pro-rata
\nbasis to those categories of employees who were on the rolls
\nof the\tcompany\t as  on\t 31.12.1986  but  have\tsubsequently
\nseparated due  to superannuation  and  voluntary  retirement
\netc. Those  who retired\t on attaining the age of 58 years or
\nvoluntarily retired under Rule 24.2. (b) or (c), as the case
\nmay be,\t under the  Conduct,  Discipline  and  Appeal  Rules
\nreferred to  hereinbefore. The\tbenefits of  the revision of
\npay scales shall not be applicable to those persons who were
\non  the\t  rolls\t of   the  Company   as\t on  31.12.1986\t but
\nsubsequently left the service of the company before the date
\nof  issue   of\tOffice\t Order\tNo.45\/90   for\tany  reason,
\nwhatsoever,  including\t  resignation  except  the  category
\nmentioned  in  clause  2.2  above.  Thereby,  the  necessary
\nimplication is\tthat all  those who are covered and stand on
\nthe same  footing are  excluded\t except\t to  the  extent  of
\ngratuity, revision  of the terminal benefits as mentioned in
\npara 6.13  which postulates that gratuity paid or payable to
\nemployees covered  under Clause\t 2.2 will be recalculated on
\nthe revised  pay subject to the prescribed ceiling. Thus, it
\ncould be  seen that  the distinction  has been drawn between
\nemployees who  retired voluntarily  under Rule\t24.2 of\t the
\nConduct, Discipline  and Appeal\t Rules or  the employees who
\nretired under  the Special  Scheme operating  from  time  to
\ntime. The  respondents\thaving\tretired\t under\tthe  Special
\nScheme\tare   not  employees  covered  under  the  voluntary
\nretirement under  Rule 24.2  of the  Conduct, Discipline and
\nAppeal Rules referred to hereinbefore. Accordingly, the High
\nCourt was  not\tright  in  directing  recomputation  of\t the
\ncompensation under Office Order No.45 dated March 1, 1991.\n<\/p>\n
     The appeals  are accordingly allowed. Consequently, the
\nwrit petitions stand dismissed. No costs.<\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Hindustan Machines Tools Ltd. & … vs M.S. Kang\/P.N. Kashyap on 27 January, 1997 Bench: K. Ramaswamy, G.T. Nanavati PETITIONER: HINDUSTAN MACHINES TOOLS LTD. & ANR. Vs. RESPONDENT: M.S. KANG\/P.N. KASHYAP DATE OF JUDGMENT: 27\/01\/1997 BENCH: K. RAMASWAMY, G.T. NANAVATI ACT: HEADNOTE: JUDGMENT: WITH CIVIL APPEAL NO. 627 OF 1997 (Arising […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-174733","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nHindustan Machines Tools Ltd. & ... vs M.S. Kang\/P.N. 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