1989 (4) TMI 292 - SC - Indian Laws

Trust Ordered to Pay Salary Arrears, Closure Compensation, and Provident Fund Dues with Interest

The Supreme Court upheld the Gujarat High Court's judgment, directing the Trust to pay remaining arrears as per the Chancellor's Award, salary from April ... Writ jurisdiction under Article 226 - Mandamus against private bodies performing public duties - Liability of aided affiliated college management to pay terminal benefits and arrears - Ordinance 120E closure compensation binding on affiliated colleges - University decision on pay scales binding on affiliated collegesWrit jurisdiction under Article 226 - Mandamus against private bodies performing public duties - Maintainability of writ petitions for mandamus against the trust managing an aided, affiliated college - HELD THAT: - The High Court correctly entertained writ petitions against the trust. Article 226 confers on High Courts power to issue writs to 'any person or authority' for enforcement of rights and 'for any other purpose', and must be given a liberal meaning unlike Article 12. Where a body performs public duties (such as administering an aided college receiving government aid and subject to university regulation) the character of employment and related rights acquire a public dimension. Mandamus is not confined to statutory bodies; it lies against bodies performing public duties or where a positive obligation exists, whether imposed by statute, contract, custom or university regulations. Technical restrictions derived from English prerogative-writ limitations do not curtail the broader scope of Article 226. Accordingly, the trust, being an aided and affiliated institution discharging public functions and subject to university control, is amenable to writ jurisdiction and mandamus to enforce payment obligations cannot be denied on the ground that it is a private trust.Writ petitions against the trust were maintainable and mandamus could be issued to compel performance of the trust's obligations.Liability of aided affiliated college management to pay terminal benefits and arrears - University decision on pay scales binding on affiliated colleges - Obligation of the college management to pay arrears of salary, provident fund dues and other terminal benefits to retrenched teachers - HELD THAT: - Under the master-servant relationship the management is primarily liable to pay salary, provident fund and terminal benefits to employees. The university's accepted award on revised pay scales and the Government's acceptance and directions to affiliated colleges render those pay scales binding on the management. The management cannot withhold payments on the ground that reimbursement from the State has not been obtained. The retrenched teachers sought monetary reliefs (arrears, provident fund, gratuity and closure compensation) and not reinstatement; these are enforceable claims because their service conditions, being regulated by university decisions and government aid, possess a public character and create enforceable obligations on the management. The High Court's direction that the trust pay the specified amounts was thus sustainable.The trust is liable to pay the arrears of salary, provident fund dues and other terminal benefits as directed by the High Court.Ordinance 120E closure compensation binding on affiliated colleges - Whether Ordinance 120E prescribing closure compensation bound the management despite being enacted before the college's permanent affiliation - HELD THAT: - The Ordinance was enacted prior to the college's closure and the college had earlier temporary affiliation; closure occurred after the Ordinance came into force. The obligations created by Ordinance 120E therefore crystallised upon closure, and the management cannot avoid liability on the ground that the Ordinance pre-dated permanent affiliation. The power of the syndicate to enact the Ordinance was not assailed on sustainable grounds, and the High Court rightly held that the management must pay compensation under the Ordinance when the college was closed.Ordinance 120E is binding on the management and closure compensation under it is payable.Final Conclusion: Appeals dismissed. The Supreme Court affirmed the High Court's directions that the trust pay the arrears, provident fund and terminal benefits including closure compensation and ordered payment with interest; the trust was also directed to pay the respondents' costs, quantified by the Court. Issues Involved:1. Liability of the Trust to pay arrears of salary under the Chancellor's Award.2. Liability to pay closure compensation under Ordinance 120E.3. Maintainability of the writ petition under Article 226 against the Trust.Detailed Analysis:1. Liability of the Trust to Pay Arrears of Salary under the Chancellor's Award:The appellants contended that the liability to pay arrears of salary under the Chancellor's Award was that of the Government and not the management of the college. However, the court found that the management, under the relationship of master and servant, is primarily responsible for paying salary and other benefits to the employees. The management cannot defer payment to the staff until the State compensates them. The court emphasized that the management's obligation to pay the arrears of salary is independent of any reimbursement claims they may have against the State.2. Liability to Pay Closure Compensation under Ordinance 120E:The appellants argued that Ordinance 120E, which prescribes closure compensation, was not binding because it was enacted before the college was affiliated to the University. The court rejected this contention, noting that the college had temporary affiliation even before the Ordinance was enacted. The benefits under the Ordinance apply when the college is closed, which in this case happened after the Ordinance was enacted. Therefore, the appellants are liable to pay the closure compensation as stipulated.3. Maintainability of the Writ Petition under Article 226 Against the Trust:The appellants asserted that the Trust, being a private body, is not subject to the writ jurisdiction of the High Court under Article 226. The court examined whether the Trust, managing an affiliated college receiving public funds, performs public duties. The court highlighted that educational institutions receiving government aid discharge public functions and are subject to the rules and regulations of the affiliating University. Consequently, the employment conditions of the academic staff have a public character. The court concluded that mandamus could be issued to enforce the legal right-duty relationship between the staff and the management, thus rejecting the contention that the writ petition was not maintainable.Conclusion:The Supreme Court upheld the judgment of the Gujarat High Court, directing the Trust to pay the remaining six installments of arrears as per the Chancellor's Award, salary for the period from April 1, 1975, to June 14, 1975, closure compensation under Ordinance 120E, and provident fund dues. The court emphasized that the Trust's obligation to pay these amounts is independent of any claims for reimbursement from the State. The appeals were dismissed with a directive to pay all amounts due with 12 percent interest and costs quantified at Rs. 26,000.