M.D. Rahamatullah vs Depot Manager, APSRTC, Karimnagar and others

The petitioner, who is working as conductor in respondent No.1-Depot, is seeking a writ of certiorari or any other appropriate order or direction and to quash or set aside Circular/Memo No.P1/93(12)/87-PD, dated 11-7-1990 and consequential direction to respondent No.1 to sanction Special Grade with effect from 21-1-1993 together with the arrears.

The facts leading to this writ petition in brief are that the petitioner was appointed as a conductor on 21-1-1981. He was removed from service on 6-1-1987 on the ground of some irregularities allegedly committed by him in issuing tickets. He challenged the order of removal before the concerned Labour Court where an award was passed in ID No.215 of 1989 dated 19-8-1989 directing his reinstatement into service forthwith with continuity of service and all other attendant benefits. Thus he completed twelve years of service as on 21-1-1993 and became eligible for Special Grade. Thereupon he filed a representation on 20-11-1995 before respondent No.2 for sanction of the same. He also approached respondent No.1. He has been orally informed that he was not entitled for Special Grade in view of the impugned Circular dated 11-7-1990. Thereupon, the petitioner filed WP No.13810 of 1996 for a direction to sanction stagnation increments counting twelve years of service on the basis of continuation of service with effect from 21-1-1991 as per the Award of the Labour Court. The respondents resisted the petition on the ground that he is not entitled for the same as per the impugned Circular. The petitioner specifically asserted that he had no knowledge of the impugned Circular till the counter is filed in WP No.13810 of 1996 and hence he could not challenge the same earlier. It is now contended that the Circular is bad in law and is discriminatory and violative of Articles 14 and 16 of the Constitution.

The respondents filed a common counter. It is stated that the petitioner would be entitled for stagnation increments only on completion of twelve years of active service as per the guidelines in the impugned Memorandum. Tracing the history of sanction of stagnation increments, it is stated that pursuant to an agreement of the Management with the Unions u/s 12(3) of the Industrial Disputes Act, Circular No.PD/65/1989 dated 3-6-1989 was issued extending the benefit of stagnation increments to employees who had no chance of promotion even after working for long period of twelve years, but the above circular is not applicable to persons who are deemed to be in service by virtue of Award of the Labour Court and that position has been clarified by the impugned Memorandum. Thus, it is contended that the writ petition is devoid of merits.

Heard both sides.

Sri Sadu Rajeswar Reddy, learned Counsel for the petitioner strenuously contended that there is no distinction between active service and notional service for the purpose of reckoning service for sanction of Special Grade. Adverting to the petitioner''s case he contended that he has been directed to be reinstated by the Labour Court with continuity of service and hence he shall be deemed to be in service through out. He relied on a judgment of this Court in T. Narayana Vs. Managing Director, APSRTC, Hyd. and Others, , which is confirmed in WA No.1269 of 1998 dated 13-8-1998. He also placed strong reliance on a judgment of a Division Bench in WA No.2164 of 1998 dated 21-12-1998.

On the other hand, Smt. Nanda Ramachandra Rao, learned Standing Counsel for A.P.S.R.T.C. contended that in the above cited case fixation of pay on the date of reinstatement by taking into account notional increments which the employee would have earned during the period of out of employment was considered whereas the issue raised in this case is different so much so that the legality of the Circular issued by the Corporation for taking into account only active service for the purpose of sanction of Special Grade or stagnation increments. She further submits that the above case law is not applicable and she strenuously contended that there is no illegality in the above Circular, as the employer is not entitled to prescribe a different norm to an employee who has been reinstated into service by virtue of an Award of Labour Court vis-a-vis other regular employees, who have rendered continuous active service without any blemish. According to her, the impugned Circular is neither discriminatory nor violative of Articles 14 and 16 of the Constitution. She then pointed out that the petitioner has already filed. WP No.13810 of 1996 for the same relief and the same was dismissed by a learned single Judge and his writ appeal was also dismissed by a Division Bench and hence, he is not entitled for any relief.

During the course of hearing, learned Counsel for the petitioner placed on record an Office Order bearing No.El/544(1) 98-RM : KR, dated 27-2-1998 wherein the petitioner has been granted Special Grade with effect from 1-10-1996. It is evident that the relief sought for has been granted by the respondent-Corporation, but the grievance of the petitioner is that it ought to have bene given effect from 25-1-1993. As the petitioner was out of service for a period of more than three years and he has been reinstated by virtue of the Award of the Labour Court, the above period is disregarded by virtue of the impugned Circular.

The short question that arises for consideration is whether the period during which the petitioner was out of service prior to his reinstatement is to be counted for continuity of service for the purpose of Special Grade or stagnation increments.

In T. Narayana''s case (supra) this Court considered a similar case where a conductor was removed from service with effect from 17-11-1986 as a disciplinary measure and when the removal was challenged before the Labour Court an Award directing his reinstatement with continuity of service but without backwages was passed. He was out of employment between 17-11-1986 and the date of reinstatement in October, 1993. The question was whether that period should be taken into consideration for the purpose of fixing his wage. This Court held ;

"It is needless to state that though under the Award passed by the Labour Court, the petitioner is not entitled to the back wages, since the Labour Court has awarded continuity of service, it goes without saying that after reinstatement, the management, while fixing the wage payable to the petitioner, should take into account the continuity of service of the petitioner between 17-11-1986 and the date on which he was reinstated into service. It is well settled that whenever an Industrial Court or any other Court grants continuity of service to an employee, the effect of such grant is that the employee should be deemed to have been in service when he was out of employment. This is a legal fiction flowing from grant of continuity of service."

It is noteworthy that the above judgment has been confirmed in \\VA No. 1269 of 1998 dated 13-8-1998 by a Division Bench of this Court.

In WA No.2164 of 1998 another Division Bench comprising of the Acting Chief Justice P. Venkatarama Reddi, J., and myself - following the decisions of this Court in \\VA No.1060 of 1998, 1321 of 1997, 395 of 1996 and WP No.11585 of 1988, out of which the judgment in WA No.395 of 1996 was confirmed in SLP No.20096 of 1996 by the Apex Court, took a similar view and held that the benefit of continuity of service cannot be restricted only to the computation of seniority or for pensionary benefits.

Thus, it is seen that line of authorities on this question is rather uniform and it is held time and again that whenever a Labour Court directs reinstatement with continuity of service but without backwages, the employee concerned will be entitled for all the benefits flowing from continuity of service. The only restriction is upon payment of backwages which is imposed by the Labour Court Award itself.

Turning to the case on hand the petitioner is seeking the benefit of continuity of service for the purpose of sanction of Special Grade which is otherwise known as sanction of stagnation increments. It maybe borne in mind that Special Grade is sanctioned taking into account the legal fiction that the employee should be deemed to be in service even during the period of suspension. Such a legal fiction has been envisaged by S.R. Nayak, J., in his judgment in T. Narayana''s case (supra).

In the light of the aforesaid authorities and the conclusion reached by me, can the impugned Circular imposing restriction upon reckoning the above service for the purpose of sanction of Special Grade stand the test of law. Smt. Nanda Ramachandra Rao sought to justify the above Circular on the ground that the employees who have been reinstated into service as per the Award of the Labour Court will have to be distinguished from other employees who have rendered normal service. On a careful consideration of the entire issue, I am unable to agree. An employee who has succeeded before the Labour Court and who has been directed to be reinstated with continuity of service has to be treated on part with all other employees. Otherwise, a stigma will be attached to the employees who are reinstated by virtue of the Award of the Labour Court, if the impugned Circular is allowed to continue. In my considered view, the Circular is discriminatory and hence it is violative of Articles 14 and 16 of the Constitution.

Next conclusion of Smt. Nanda Rao is that the petitioner has already filed WP No.13810 of 1996 and the same was dismissed and his writ appeal has also been dismissed and hence it is a bar. Although such a ground is not taken in the counter filed by the Corporation, I considered the same. It is noteworthy that the relief claimed in the above writ petition is different from the relief herein. The petitioner merely sought for grant of stagnation increments together with arrears but he did not challenge the impugned Circular. Hence the principles of constructive res judicata do not operate and this writ petition is therefore maintainable. For all the reasons given above the point is answered in favour of the petitioner.

In the result, the writ petition is allowed and the impugned Circular/Memo No.P1/93(12)/87-PD dated 11-7-1990 is struck down being violative of Articles 14 and 16 of the Constitution and the respondents are consequently directed to sanction Special Grade to the petitioner with effect from 21-1-1993 instead of 1-10-1996 and to pay the arrears, if any, under the Special Grade. Three months time is fixed for compliance. There will be no order as to costs.