Sh. J.P. Pandey and Others vs M/s. Hindustan Prefab Ltd. and Others

Valmiki J Mehta, J.—This writ petition is filed by six petitioners who have retired from the respondent no. 1/Hindustan Prefab Ltd. Though it is not clear who superannuated naturally, and who had taken voluntary retirement, however, it is not disputed that all the petitioners have retired from respondent no. 1 in 2008. The prayer in the writ petition is for grant to the petitioners of pay revision benefits as per notification of the Ministry of Finance dated 29.8.2008 and the Office Memorandum dated 14.10.2008 issued by the Ministry of Heavy Industries and Public Enterprises. Reliance is finally placed upon the circular of the respondent no. 1 itself dated 14.10.2009 for claiming the reliefs as prayed for in the writ petition.

In my opinion, the writ petition is misconceived and liable to be dismissed for the following reasons:-

(i) Firstly, the notification relied upon of the Ministry of Heavy Industries and Public Enterprises dated 14.10.2008 by its para-3 makes it clear that the Pay Commission Report so far as loss making Central Public Sector Enterprises (CPSEs) are concerned would not automatically apply, and any of such CPSEs will be entitled to take its own decision depending upon its financial position. The respondent no. 1, pursuant to this direction of the Ministry of Heavy Industries and Public Enterprises has taken its decision in terms of the circular dated 14.10.2009 whereby the payment of the revised pay-scales will be effective only from 1.4.2009. Petitioners therefore not being employees of respondent no. 1 as on 1.4.2009, the circular of the respondent no. 1 dated 14.10.2009 cannot apply to the petitioners, and the petitioners hence cannot take benefit of this circular. As already stated above, petitioners have retired before the circular dated 14.10.2009, which made 1.4.2009, as the effective date for revision of the pay-scales.

(ii) The second reason for dismissing of the writ petition is that the Supreme Court in the case of Officers and Supervisors of I.D.P.L. Vs. Chairman and M.D. I.D.P.L. and Others, has held that Courts cannot issue directions to organizations for making of payment of a particular pay-scale when such companies are sick companies and have no financial resources to make payments to their employees. The Supreme Court in this regard relied upon one of its earlier judgments in the case of A.K. Bindal and Another Vs. Union of India (UOI) and Others, which held similarly. I may note that the Supreme Court subsequently in the judgment of Indian Drugs and Pharmaceuticals Ltd. Vs. Workman, Indian Drugs and Pharmaceuticals Ltd., has stressed on the fact that Courts cannot direct that a particular organization should pay a particular scale of pay to its employees and these aspects are best left to the decision of the executive and the organizations concerned, who are better aware of the financial conditions for deciding giving of the pay-scales to be paid to its employees and from which date.

(iii) The third reason for dismissing of the writ petition so far as some of the petitioners who have taken voluntary retirement is that once voluntary retirement is taken, the jural relationship of employer and employee terminates and an employee has no right to claim any past dues on the basis of revision of pay-scales once the entire amount of VRS is taken by the employee. This is so stated in the case of A.K. Bindal (supra) and para 34 thereof which reads as under:-

This shows that a considerable amount is to be paid to an employee ex-gratia besides the terminal benefits in case he opts for voluntary retirement under the Scheme and his option is accepted. The amount is paid not for doing any work or rendering any service. It is paid in lieu of the employee himself leaving the services of the company or the industrial establishment and foregoing all his claims or rights in the same. It is a package deal of give and take. That is why in business world it is known as ''Golden Handshake''. The main purpose of paying this amount is to bring about a compete cessation of the jural relationship between the employer and the employee. After the amount is paid and the employee ceases to be under the employment of the company or the undertaking, he leaves with all his rights and there is no question of his again agitating for any kind of his past rights, with his erstwhile employer including making any claim with regard to enhancement of pay scale for an earlier period. If the employee is still permitted to raise a grievance regarding enhancement of pay scale from a retrospective date, even after he has opted for Voluntary Retirement Scheme and has accepted the amount paid to him, the whole purpose of introducing the Scheme would be totally frustrated.

(underlining added)

Therefore, on all the aforesaid three counts, the writ petition does not lie and it is accordingly dismissed, leaving the parties to bear their own costs.