{"id":206182,"date":"2002-02-26T00:00:00","date_gmt":"2002-02-25T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/sree-kumar-r-vs-union-of-india-uoi-and-anr-on-26-february-2002-2"},"modified":"2015-12-24T09:57:17","modified_gmt":"2015-12-24T04:27:17","slug":"sree-kumar-r-vs-union-of-india-uoi-and-anr-on-26-february-2002-2","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/sree-kumar-r-vs-union-of-india-uoi-and-anr-on-26-february-2002-2","title":{"rendered":"Sree Kumar R. vs Union Of India (Uoi) And Anr. on 26 February, 2002"},"content":{"rendered":"<div class=\"docsource_main\">Delhi High Court<\/div>\n<div class=\"doc_title\">Sree Kumar R. vs Union Of India (Uoi) And Anr. on 26 February, 2002<\/div>\n<div class=\"doc_citations\">Equivalent citations: 2002 VAD Delhi 690, 97 (2002) DLT 347, 2003 (97) FLR 709, 2003 (1) SLJ 200 Delhi<\/div>\n<div class=\"doc_author\">Author: S K Kaul<\/div>\n<div class=\"doc_bench\">Bench: S K Kaul<\/div>\n<\/p>\n<pre><\/pre>\n<p>JUDGMENT<\/p>\n<p> Sanjay Kishan Kaul, J.  <\/p>\n<p> 1. Rule.\n<\/p>\n<p> 2. With the consent of learned counsel for the<br \/>\nparties the matter is taken up for final disposal.\n<\/p>\n<p> 3. The petitioner are officers and employees<br \/>\nworking in different capacities at different centres of<br \/>\nhindustan Vegetable Oils Corporation Limited &#8211;<br \/>\nrespondent No. 2. The performance of respondent No. 2<br \/>\napparently started suffering from 1991 onwards and in<br \/>\n1996 the case of respondent No. 2 was referred to<br \/>\nDisinvestment Commission. The Disinvestment Commission<br \/>\nsubmitted its report and the case of respondent No. 2<br \/>\ncorporation was also referred to Board For Industrial<br \/>\nAnd Financial Reconstruction (for short the BIFR) under<br \/>\nSection 15(1) of the Sick Industrial Companies (Special<br \/>\nProvisions) Act, 1985 (for short the said SICA) in<br \/>\nDecember, 1999. The BIFR declared respondent No. 2<br \/>\ncorporation as a sick industrial company in terms of<br \/>\nthe provision of Section 3(1)(o) of the said Act. The<br \/>\npetitioner and other officers of the respondent No. 2<br \/>\ncorporation also moved the BIFR to be imp leaded as<br \/>\nparty and sought directions for revival of respondent<br \/>\nNo. 2. Certain directions were passed by the BIFR.\n<\/p>\n<p> 4. The petitioner is aggrieved by the order dated<br \/>\n6.11.2000 issued by the Government of India introducing<br \/>\na Voluntary Separation Scheme (VSS) for the employees of<br \/>\nrespondent No. 2. The scheme was kept open for a period<br \/>\nof 3 months and it was envisaged in the said order that<br \/>\nthe employees who failed to apply under the scheme<br \/>\nwould be eligible only for retrenchment under the<br \/>\nprovisions of the Industrial Disputes Act, 1947. A<br \/>\nrepresentation was made by the petitioners for keeping<br \/>\nin abeyance the said scheme till the BIFR considers the<br \/>\nissue or in the alternative pay wages\/compensation in<br \/>\nterms of the directions of the Supreme Court relating<br \/>\nto the Subzi Mandi unit of respondent No. 2.\n<\/p>\n<p> 5. The petitioner has ultimately filed the<br \/>\npresent petition seeking the following relief:-\n<\/p>\n<p>  &#8220;a) issue a writ of mandamus<br \/>\nor any other appropriate writ order<br \/>\nor direction directing the<br \/>\nrespondent to extend the proposed<br \/>\nVoluntary Separation Scheme dated<br \/>\n6.11.2000 vide Notification<br \/>\nNo.F. 5-3\/99 HVOC till the final<br \/>\ndecision is taken by the BIFR for<br \/>\nthe purposes of<br \/>\nrevival\/rehabilitation of HVOC; and\n<\/p>\n<p>b) issue a writ of mandamus or<br \/>\nany other appropriate writ order or<br \/>\ndirection directing the Respondent<br \/>\nauthorities to formulate a &#8216;Golden<br \/>\nHand Shake&#8217; Scheme based on the<br \/>\npackage as ordered by the Hon&#8217;ble<br \/>\nSupreme Court in T.A.No. 30 in Writ<br \/>\nPetition No. 4677\/1985 dated 31.12.96<br \/>\non the revised wages\/salaries&#8217;<\/p>\n<p> 6. Mr. Rajiv Dutta, learned senior counsel appearing<br \/>\nfor the petitioner has contended that the basis of the<br \/>\nscheme of voluntary separation as also the short period<br \/>\nwithin which the application was sought from the<br \/>\nemployees is arbitrary and illegal. The said scheme<br \/>\nwas sought to be implemented under the threat of<br \/>\nclosure. The learned senior counsel contends that the<br \/>\nbenefits to be extended to the employees cannot be<br \/>\ndecided in isolation and that the employees would be<br \/>\nentitled for their dues and claims w.e.f. 1.4.97.<br \/>\nThus the contention is that the revision of the pay<br \/>\nscale having been given to the other public sector<br \/>\nenterprises w.e.f. 1.1.97 should also be made<br \/>\napplicable to respondent No. 2 corporation. Mr. Dutta,<br \/>\nlearned senior counsel, has contended that even the<br \/>\nDisinvestment Commission took note of the substantial<br \/>\nassets of respondent No. 2 and observed as under:-\n<\/p>\n<p>  &#8220;The estimate value of the<br \/>\nother freehold real estates owned by<br \/>\nHVOCL Units (as per valuation<br \/>\nperformed by Central Bureau of<br \/>\nDirect Taxes (CBDT) in November,<br \/>\n1996) is quite substantial. Hence,<br \/>\nthe net inflow to Government by<br \/>\nclosing down all the units by<br \/>\nliquidating their assets and selling<br \/>\nthe breakfast foods unit after<br \/>\nsettling all the claims and<br \/>\nretirement benefits would still be<br \/>\nhigh.&#8221;\n<\/p>\n<p> 7. Learned senior counsel while contending that the<br \/>\npurport of the scheme is in fact to scuttle the<br \/>\nproceedings before the BIFR referred to the note to<br \/>\npara 6.1.1 of the voluntary retirement scheme of<br \/>\nHindustan Organic Chemicals Limited to the following<br \/>\neffect:-\n<\/p>\n<p> &#8220;i) Salary for the purpose of<br \/>\ncalculation of compensation in<br \/>\nrespect of officers shall be<br \/>\nnotionally on revised pay scales of<br \/>\nofficers, as approved by the Board<br \/>\nof Directors\/Government.\n<\/p>\n<p> ii)&#8230;.\n<\/p>\n<p>iii)&#8230;\n<\/p>\n<p>iv) Arrears of salary\/wage<br \/>\nrevision, shall however, become<br \/>\npayable only when company generates<br \/>\nadequate surplus through improved<br \/>\nproductivity &#8216;and profitability to<br \/>\nthe satisfaction of Administrative<br \/>\nMinistry.&#8217;<\/p>\n<p> 8. The aforesaid Sub-clause 4 is also being<br \/>\nreproduced because it has relevance when the matter in<br \/>\nquestion will be considered.\n<\/p>\n<p> 9. The learned senior counsel has also referred to<br \/>\ncertain proceedings before the BIFR of 1.2.2001 to<br \/>\ncontend that even BIFR was of the view that VSS<br \/>\nextended to the company was an indication to the staff<br \/>\nthat the company was to be closed down in due course<br \/>\nand was a sort of a threat that in case the employees<br \/>\ndid not accept the VSS they would be paid retrenchment<br \/>\ndues. The BIFR observed that the Government could not<br \/>\nunilaterally decide this matter.\n<\/p>\n<p> 10. Ms. Tamali Wad, learned counsel for respondent<br \/>\nNo. 1, on the other hard, has contended that he prayers<br \/>\nmade in the writ petition have to be seen and no<br \/>\ndirections can be issued in favor of the petitioner on<br \/>\nthe existing prayers. Learned counsel has further<br \/>\ncontended that it is for the first time in rejoinder<br \/>\nthat a reference has been made to different schemes of<br \/>\nvoluntary separation retirement of other public sector<br \/>\ncompanies though this was not the case set out in the<br \/>\npetition. Learned counsel has referred to (iv) para of<br \/>\nthe Note referred above to contend that if the two<br \/>\nclauses of the Note are read together it would be<br \/>\napparent that the arrears of salary\/wages would become<br \/>\npayable in that case only when the company generates<br \/>\nadequate surplus. The learned counsel also referred to<br \/>\nthe office memorandum dated 14.1.99 issued by the<br \/>\nMinistry of Industries in respect of policy for the 6th<br \/>\nround of wages negotiation in public sector enterprises<br \/>\nwhere in para 2 it is stated that as regards sick units<br \/>\nregistered under the BIFR until BIFR approves revival<br \/>\nplans in which provision shave been made for additional<br \/>\nexpenditure on account of pay revision, no pay revision<br \/>\nwould be allowed to the employees of such enterprises.\n<\/p>\n<p> 11. I have heard learned counsel for the parties at<br \/>\nlength.\n<\/p>\n<p> 12. In my considered view the illustration of terms<br \/>\nof voluntary retirement scheme of other public sector<br \/>\nenterprises would not be directly relevant to the case<br \/>\nof respondent No. 2. Each company will have its own<br \/>\nfinancial calculations and a scheme has to be devised<br \/>\nkeeping in mind the financial position of that company.<br \/>\nThere may be situations where in one particular scheme<br \/>\nadditional emoluments are paid but they may be deferred<br \/>\ndepending on the amounts generated as in the case<br \/>\nmentioned above. These are matters of weighing the<br \/>\neconomic condition of a particular company and no<br \/>\nuniform pattern can be made in respect of the same.\n<\/p>\n<p> 13. In the earlier order dated 16.1.2002 it was<br \/>\nalready noted that present writ petition is really<br \/>\nrelated to two reliefs. In so far as the second relief<br \/>\nis concerned the same is based on a package as was<br \/>\ndirected by the Hon&#8217;ble Supreme Court in IA 30 in Writ<br \/>\nPetition No. 4677\/85 dated 31.12.96. The said package<br \/>\nwas in the peculiar facts of that case as units were<br \/>\ndirected to be shifted from the existing places being<br \/>\npolluting units. The package was applicable not only<br \/>\nto the unit of respondent No. 2 but also to all such<br \/>\npolluting units. The said direction can by no means be<br \/>\nmade applicable to the issue of general viability of<br \/>\nrespondent No. 2 unit nor can that form the basis for<br \/>\nthe grant of any voluntary separation scheme or<br \/>\notherwise.\n<\/p>\n<p> 14. The first relief claimed in the writ petition is<br \/>\nfor extension of time for voluntary separation scheme.<br \/>\nAdmittedly, the petitioner and other employees applied<br \/>\nunder the said scheme, have been considered under the<br \/>\nsaid scheme and have availed of the benefits of the<br \/>\nsaid scheme. It may, however, be noted that the said<br \/>\nscheme was availed of without prejudice to the rights<br \/>\nand contentions of the petitioner in terms of the order<br \/>\ndated 12.1.2001.\n<\/p>\n<p> 15. The contention of learned senior counsel for the<br \/>\npetitioner that the benefit of 1997 wages should be<br \/>\ngiven to the petitioners cannot be sustained as<br \/>\nadmittedly that is not in the package offered under the<br \/>\nVSS scheme. Not only this respondent No. 2 is before<br \/>\nthe BIFR and in terms of the office memorandum dated<br \/>\n14.1.99 the revision of wages was subject to the<br \/>\nprovisions to be made for additional expenditure on<br \/>\naccount of such pay revision where companies like<br \/>\nrespondent No. 2 were before the BIFR.\n<\/p>\n<p> 16. It may also be noted that during the pendency of<br \/>\nthe present writ petition the proceedings before the<br \/>\nBIFR have been concluded and have culminated in an<br \/>\norder dated 7.12.2000.\n<\/p>\n<p> 17. It may be in the end noted that these are<br \/>\nmatters of economic consideration working out packages<br \/>\ntaking the overall health of the company in<br \/>\nconsideration. The Constitution Bench of the Supreme<br \/>\nCourt had the occasion recently to consider the case of<br \/>\nDisinvestment in the case of  <a href=\"\/doc\/1737583\/\">BALCO Employees&#8217;<br \/>\nUnion (Registered) v. Union of India<\/a> 2001 (8) SCALE\n<\/p>\n<p>541. The relevancy of the said judgment is to the<br \/>\nextent as to what is the scope of enquiry by the courts<br \/>\nin the matters relating to economics and functioning of<br \/>\nthe companies. While dealing with the rights of the<br \/>\nemployees the Supreme court observed as under:-\n<\/p>\n<p>  &#8220;47. process of disinvestment is a policy<br \/>\ndecision involving complex economic factors. The<br \/>\nCourts have consistently refrained from<br \/>\ninterfering with economic decisions as it has<br \/>\nbeen recognised that economic expediencies lack<br \/>\nadjudicative disposition and unless the economic<br \/>\ndecision, based on economic expediencies, is<br \/>\ndemonstrated to be so violative of constitutional<br \/>\nor legal limits on power or so abhorrent to<br \/>\nreason, that the Courts would decline to<br \/>\ninterfere. In matters relating to economic<br \/>\nissues, the Government has, while taking a<br \/>\ndecision, right to &#8220;trial and error&#8221; as long as<br \/>\nboth trial and error are bonafide and within<br \/>\nlimits of authority. There is no case made out<br \/>\nby the petitioner that the decision to disinvest<br \/>\nin BALCO is in any way capricious, arbitrary,<br \/>\nillegal or uninformed. Even though the workers<br \/>\nmay have interest in the manner in which the<br \/>\nCompany is conducting its business, inasmuch as<br \/>\nits policy decision may have an impact on the<br \/>\nworkers&#8217; rights, nevertheless it is an incidence<br \/>\nof service for an employee to accept a decision<br \/>\nof the employer which has been honestly taken and<br \/>\nwhich is not contrary to law. Even a government<br \/>\nservant, having the protection of not only<br \/>\nArticles 14 and 16 of the Constitution but also<br \/>\nof Article 311, has no absolute right to remain<br \/>\nin service. For example, apart from cases of<br \/>\ndisciplinary action, the service of government<br \/>\nservants can be terminated if posts are<br \/>\nabolished. If such employee cannot make a<br \/>\ngrievance based on part III of the Constitution or<br \/>\nArticle 311 then it cannot stand to reason that<br \/>\nlike the petitioners, non-government employees<br \/>\nworking in a company which by reason of judicial<br \/>\npronouncement may be regarded as a State for the<br \/>\npurpose of Part III of the Constitution, can<br \/>\nclaim a superior or a better right than a<br \/>\ngovernment servant and impugn it&#8217;s change of<br \/>\nstatus. In taking of a policy decision in<br \/>\neconomic matters at length, the principles of<br \/>\nnatural justice have no role to play. While it<br \/>\nis expected of a responsible employer to take all<br \/>\naspects into consideration including welfare of<br \/>\nthe labour before taking any policy decision<br \/>\nthat, by itself, will not entitle the employees<br \/>\nto demand a right of hearing or consultation<br \/>\nprior to the taking of the decision.\n<\/p>\n<p> 48. Merely because the workman may have<br \/>\nprotection of Articles 14 and 16 of the<br \/>\nConstitution, by regarding BALCO as a State, it<br \/>\ndoes not mean that the erstwhile sole shareholder<br \/>\nviz., Government had to give the workers prior<br \/>\nnotice of hearing before deciding to disinvest.<br \/>\nThere is no principle of natural justice which<br \/>\nrequires prior notice and hearing to persons who<br \/>\nare generally affected as a class by a economic<br \/>\npolicy decision of the Government. If the<br \/>\nabolition of a post pursuant to a policy decision<br \/>\ndoes not attract the provisions of Article 311 of<br \/>\nthe Constitution as held in <a href=\"\/doc\/788891\/\">State of Haryana v.<br \/>\nShri Des Raj Sangar and Anr.,<\/a> (1976) 2 SSC<br \/>\n844, on the same parity of reasoning, the policy<br \/>\nof disinvestment cannot be faulted if as a result<br \/>\nthereof the employees lose their rights or<br \/>\nprotection under Articles 14 and 16 of the<br \/>\nConstitution. In other words, the existence of<br \/>\nrights of protection under Articles 14 and 16 of<br \/>\nthe Constitution cannot possibly have the effect<br \/>\nof vetoing the Government&#8217;s right to disinvest.<br \/>\nNor can the employees claim a right of continuous<br \/>\nconsultation at different stages of the<br \/>\ndisinvestment process. If the disinvestment<br \/>\nprocess is gone through without contravening any<br \/>\nlaw, then the normal consequences as a result of<br \/>\ndisinvestment must follow.&#8221;\n<\/p>\n<p> 18. It is thus apparent from a reading of the<br \/>\naforesaid judgment that the Supreme Court has held that<br \/>\nemployment of the employees with a public sector<br \/>\nenterprise is an incidence of the service of the<br \/>\nemployee and the employee would thus be bound by the<br \/>\ndecision taking honestly which is not contrary to law.<br \/>\nIt is further held that there is not right in the<br \/>\nemployees to demand hearing or consultation prior to<br \/>\nthe taking of the decision.\n<\/p>\n<p> 19. The petitioner is thus not entitled to any of<br \/>\nthe reliefs claimed in the petition. In view of the<br \/>\naforesaid facts and circumstances I am of the<br \/>\nconsidered view that no case is made out for<br \/>\ninterference under Article 226 of the Constitution of<br \/>\nIndia.\n<\/p>\n<p> 20. Dismissed.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Delhi High Court Sree Kumar R. vs Union Of India (Uoi) And Anr. on 26 February, 2002 Equivalent citations: 2002 VAD Delhi 690, 97 (2002) DLT 347, 2003 (97) FLR 709, 2003 (1) SLJ 200 Delhi Author: S K Kaul Bench: S K Kaul JUDGMENT Sanjay Kishan Kaul, J. 1. Rule. 2. With the consent [&hellip;]<\/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":[14,8],"tags":[],"class_list":["post-206182","post","type-post","status-publish","format-standard","hentry","category-delhi-high-court","category-high-court"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Sree Kumar R. vs Union Of India (Uoi) And Anr. on 26 February, 2002 - Free Judgements of Supreme Court &amp; High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/sree-kumar-r-vs-union-of-india-uoi-and-anr-on-26-february-2002-2\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Sree Kumar R. vs Union Of India (Uoi) And Anr. on 26 February, 2002 - Free Judgements of Supreme Court &amp; 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