TaxTMI 
TaxTMI 
TaxTMI 
2016 (8) TMI 1489
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....ears though they continued or are continuing in service till the age of 60 years. The writ petitioners accordingly, prayed for a writ in the nature of mandamus commanding the respondent company and the Union of India to release their salaries and allowances and further pay their monthly salary till their superannuation and directing the respondents to release retiral benefits of the petitioners who have superannuated. The Learned Judge allowed the writ petition. The operative portion of the judgment of the Learned First Court is as follows:- "I thus, allow the writ petition and direct the respondent company to take necessary steps for payment of admissible dues to the petitioners who have already retired from service and to release the unpaid salaries and allowances to the petitioners who are still in service and to go on paying the same till they attain the age of superannuation. Such steps are to be taken within a period of ten weeks from the date of the communication of the order. Needless to mention, if necessary, the respondent No. 1 shall provide the requisite financial assistance to the respondent company for making necessary payment to the writ petitioners in terms of t....
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.... Standing Orders are valid, since the same do not contain a superannuation clause, the clause under 1964 Standing Orders would prevail. In this connection Mr. Senguapta referred to Sec. 2(g) and Sec. 3 of the Industrial Employment (Standing Orders) Act, 1946 and also to the Schedule to the said Act. Sec. 2(g) of the said Act defines 'Standing Order' as rules relating to matters set out in the Schedule. Sec. 3(1) provides that within six months from the date on which the 1946 Act becomes applicable to an industrial establishment, the employer shall submit to the Certifying Officer five copies of the draft Standing Orders proposed by him for adoption in his industrial establishment. Sec. 3(2) of the Act stipulates that provision shall be made in such draft Standing Orders of every matter set out in the Schedule which may be applicable to the industrial establishment and where model Standing Orders have been prescribed, shall be, in so far as practicable, in conformity with such model. Clause 11 of the Schedule to the 1946 Act reads as 'in every matter in which may be prescribed'. Clause 2A of the Bengal Industrial Employment (Standing Orders) Rules, 1946 provides tha....
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.... special agreements. If the general conditions on matters expressly provided by the Standing Orders could be avoided by special agreements, the whole object of the Standing Orders would be frustrated and the elaborate machinery provided for their certification and enforcement would become meaningless. The Standing Orders which have passed through the carefully devised mechanism of the Act were meant by the Act to be complied with by the employers and the employees alike. Learned Counsel also relied on a Division Bench judgment of the Allahabad High Court in the case of The U.P. Co-operative Spinning Mills Ltd. vs. State of U.P., 1978 LAB IC 1137, which is also to the effect that the terms of the Standing Orders would prevail over the corresponding terms in the contract of service. 6. Mr. Sengupta referred to Sec. 10 of the Industrial Employment (Standing Orders) Act, 1946 which lays down the procedure for modification of Standing Orders. He submitted that the Standing Orders of 1964 were never modified following the said procedure and hence the retirement age of 58 years prevailed at all material times. 7. Mr. Sengupta then submitted that the impugned judgment was passed followi....
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.... the case of others. Of course, the position would be viewed differently, if petitioners plead and prove that the State had adopted a 'pick and choose' method only to exclude petitioners on account of mala fides or ulterior motives." Learned Counsel also cited the decision in State of U.P. vs. Om Prakash, (2006) 6 SCC 474. In that case Counsel for the respondents had contended that since the earlier order of the High Court had attained finality, the challenge to the subsequent order of the High Court which was passed following the earlier order must also fail. The Supreme Court rejected such contention and held that accepting such contention would amount to allowing the perpetuation of illegality. Learned Counsel also relied on a decision of the Hon'ble Supreme Court in the case of Maharaj Krishan Bhatt vs. State of Jammu and Kashmir, (2008) 9 SCC 24, wherein at paragraphs 21 and 22 of the judgment, the Hon'ble Apex Court accepted the submission of Learned Counsel for the respondent State that Arts. 14 or 16 of the Constitution cannot be invoked or pressed into service to perpetuate illegality. If one illegal action is taken, a person whose case is similar, cannot....
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....grants. In this connection he relied on a decision of a Learned Judge of this court in the case of Tyre Corporation of India Officers' Association vs. Union of India, 2001 (3) CHN 774, para 9. 11. Mr. Sengupta then submitted that the Learned Judge erred in law in not appreciating that if the remedies lie under the ID Act, writ petition is not maintainable. He cited the decision in the case of State of Assam vs. Barak Upatyaka D.U. Karmachari Sanstha, (2009) 5 SCC 694. In that case Cachar and Karimganj District Milk Producers' Cooperative Union Ltd. (in short CAMUL) was a society registered under the Assam Cooperative Societies Act, 1949. The respondent before the Supreme Court which was a trade union representing the workers of CAMUL filed a writ petition praying for a direction on the State Government to sanction finance assistance by way of grant-in-aid to CAMUL to enable CAMUL to make regular payment of monthly salaries, allowances as well as arrears of its employees. Learned Single Judge allowed the writ petition and such order was upheld by the Division Bench. The Supreme Court allowed the appeal of the State Government, inter alia, holding that if the salaries are no....
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....motion either given erroneously by the Department by misreading the Service Rules or such promotion given pursuant to judicial orders contrary to Service Rules cannot be a ground to claim erroneous promotion by perpetuating infringement of statutory Service Rules. 15. Mr. Sengupta then referred to page 26 of the judgment and order impugned before us wherein the Learned Judge observed that the crux of the problem can be reduced to a proposition i.e., whether the petitioners who had although been working or have worked in the company after reaching the age of 58 years are entitled to get their salaries and other benefits for the period between 58 and 60 years. Learned Counsel submitted that the Learned Judge has posed a wrong question. The question is whether the writ petition is maintainable. Posing a wrong question leads to a wrong answer. The learned Judge assumed that the employees/writ petitioners actually worked beyond 58 years. This is a disputed question of fact. In this connection he cited a decision of the Hon'ble Apex Court in the case of Sonepat Cooperative Sugar Mills Ltd. vs. Ajit Singh, (2005) 3 SCC 232, wherein at paragraph 23 of the judgment the Hon'ble Supr....
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....per cent increase over the existing wage bill and further the retirement age of all the employees of the company below the board level would be brought down from 60 to 58 years. It was like a package. The workers enjoyed an increase in wages but also want to take advantage of the retirement age of 60 years. Even under the bipartite agreement dated 20 August, 2001, the employees who availed of pay revision were to retire at the age of 58 years. 19. Learned Counsel submitted that the writ petitioners before the learned Single Judge relied on a decision of the Hon'ble Supreme Court in the case of Kapila Hingorani vs. State of Bihar, (2003) 6 SCC 1, for the proposition that the Union of India or the State cannot escape its liability towards payment of the workmen's dues in the event a Government undertaking or company has no financial means for the same. However, Kopila Hingorani's (supra) case was passed in the peculiar facts of the case and no law within the meaning of Art. 141 of the Constitution was laid down by the Hon'ble Supreme Court in that case. 20. Learned Counsel referred to the Supreme Court Decision in the case of State of U.P. vs. Uptron Employees' ....
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....anent Government servant has a right to hold the post and he cannot be dismissed or removed or reduced in rank unless the requirements of Art. 311 of the Constitution or the rules governing his service are complied with. However, an employee in an industrial establishment cannot be treated at par with a Government servant. 23. Learned Counsel submitted that there is no finding in the judgment and order impugned before this court that there is any legal obligation on the Union of India to provide funds for payment of the wages of the employees of the company who have allegedly served beyond the age of 58 years. Hence the direction on the Union of India to provide such finance, albeit, a conditional direction, should be set aside. Contention of the respondents/writ petitioners:- 24. Appearing for the respondents/writ petitioners, Ms. Sengupta, Learned Counsel referred to Sec. 2(b) of the Industrial Employment (Standing Orders) Act, 1946 which provides that 'appropriate Government' means in respect of industrial establishments under the control of the Central Government, the Central Government, and in all other cases, the State Government, provided that where any question a....
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....revail. 25. Ms. Sengupta submitted that the writ petitioners were all allowed to work till 60 years of age. In support of such submission she drew this court's attention to the office orders of retirement notices, individual service certificates issued by the company to the writ petitioners indicating date of birth, date of appointment and date of retirement at the age of 60 years, family pension certificates issued by the company to the writ petitioners, a note dated 13 August, 2010 relating to Employees Family Pension Scheme, 1995 and no demand certificate issued by the company to the writ petitioners when they attained 60 years of age to enable them to get the retiral benefits. She submitted that till August, 2005, all employees were paid salary till they reached 60 years of age. However, after that, the company stopped paying salary beyond the age of 58 years. Such stoppage of salary was in violation of the tripartite agreement of 1974. 26. The Union of India also raised the age of retirement from 58 years to 60 years of all employees of Central Public Sector Enterprises by memo dated 19 May, 1998. In 2001 the company entered into a bipartite settlement with the unions of....
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....h period as is agreed upon by the parties, and if no such period is agreed upon for a period of six months from the date on which the memorandum of settlement is signed by the parties and shall continue to be binding on the parties after the expiry of the aforesaid period until the expiry of two months from date on which a notice in writing of an intention to terminate the settlement is given by one of the parties to the other party to the settlement, (emphasis added is ours). Learned Counsel submitted that by allowing for the 60 days notice period, the company admitted that there was a binding settlement between the parties as regards the retirement age being 60 years. 30. Learned Counsel then referred to the rules pertaining to the Companies Employees' Gratuity fund. Rule 1(xix) provides that 'Normal Retirement Date' shall mean in respect of the member the date on which he attains the age of 60 years unless otherwise specified in the individual appointment letters. She submitted that the letters of appointment do not mention any retirement age. Hence, the retirement age is 60 years. Learned Counsel referred to a document at page 23A of the supplementary affidavit fil....
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....ollows:- (i) Rupnarayan Unit is still running. (ii) The employees are working. Retirement notices are being issued every month. (iii) Union of India is releasing fund towards salary of the Employees till they attain the age of 58 years. (iv) The Standing Order can be modified by agreement between the Employer and Workmen. (v) The tri-partite agreement of 1974 has been given effect to by the company and Central Government for last 32 years, the retirement age fixed at 60 years was acted upon, the employees received retirement benefits and salaries upto the age of 60 years till 2005. Now, both the company and Union of India are estopped from throwing challenge to the terms of the agreements with retrospective effect. (vi) The proceeding for recovery of dues of the employees are treated as a separate category of proceeding and does not come within the expression 'execution' or 'distress' as used in Section 22(1) of the SIC A. 34. Learned Counsel cited the case of Rohtak and Hissar Districts Electric Supply Company Ltd. Amitabh Textile vs. State of Uttar Pradesh, AIR 1966 SC 1471, in support of her submission that something not in the Schedule to the Standi....
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....ot possible to scan a settlement in bits and pieces and hold some parts good and acceptable and other parts bad. Unless it can be demonstrated that the objectionable portion is such that it completely outweighs all the other advantages gained, the Court will be slow to hold a settlement as unfair and unjust. 39. Ms. Sengupta relied on the decision in the case of State of Uttaranchal vs. Jagpal Singh Tyagi, (2005) 8 SCC 49, to contend that if there was dispute on the question as to whether a settlement was bona fide or was obtained by fraud, misrepresentation or concealment of facts, the same can only be the subject matter of another industrial dispute. She submitted that in the facts of the case in hand, the Management did not raise an industrial dispute in respect of any of the settlements arrived at with the workmen. 40. Learned Counsel then relied on the case of Maharaj Krishan Bhatt vs. State of Jammu and Kashmir, (2008) 9 SCC 24. Paragraphs 12 and 19 on which Learned Counsel relied are set out hereunder:- "12. The learned counsel for the appellants vehemently contended that the Division Bench of the High Court was wholly in error in allowing the appeal and in setting aside....
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.... Counsel to buttress her submission that deprivation of benefits in matters relating to employment which includes matters relating to salary, periodic increments, age of superannuation etc is violative of Art. 14 and Art. 16 of the Constitution. 44. Learned Counsel then relied on the decision in the case of S.K. Dua vs. State of Haryana, (2008) 3 SCC 44, para 14 in support of her submission that if there is delay in payment of retiral benefits, the concerned employee is entitled to receive interest thereon. 45. The decision in the case of State of Orissa vs. Mangalam Timber Products Ltd., (2004) 1 SCC 139, was cited by Learned Counsel wherein the Hon'ble Supreme Court held, inter alia, that to attract the applicability of the principle of estoppel it is not necessary that there must be a contract in writing between the parties. Holding out a representation may estop the represent or from retracting from the promise. In Grid Corporation of Orissa vs. Rasananda Das, (2003) 10 SCC 297, on facts the Hon'ble Supreme Court held that the service conditions of the petitioner were to be protected and could not be changed to his detriment by virtue of the regulation of Orissa State....
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....- "8. ..................Though no serious objection was made as to the maintainability of the writ petition, however, learned senior counsel appearing for the Management pointed out that even if there is any breach by BALCO of its obligations in the matter of terms and conditions of employment, the appellants have appropriate remedy under Industrial Law. Inasmuch as the claim of the employees relates to interpretation of certain clauses in the agreement, appointment letters and no disputed facts are involved and taking note of the fact that the issue relates to employment of few hundreds of employees and in the light of the assertion that transferring them to private organization from a public sector undertaking without their specific consent is arbitrary and unreasonable and also of the settled position that alternative remedy is rule of discretion and not the rule of law, we accept the conclusion of the High Court and hold that the writ petitions under Article 226 of the Constitution filed by the employees are maintainable............" 49. Learned Counsel then relied on the case of Kapila Hingorani vs. State of Bihar (supra), which has been referred to while noting the submiss....
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.... is not binding on this court because;- (i) The questions arising in the present proceeding were not considered by the earlier Division Bench. (ii) The earlier judgment was passed in ignorance of the Hon'ble Supreme Court's judgment reported in (2009) 5 SCC 694 and hence was rendered per incuriam. (iii) A decision is an authority for what it decides and not what is deducible from it. The earlier Division Bench did not decide any law. (iv) If a Division Bench of a High Court is faced with a Supreme Court decision and a decision of an earlier Division Bench of the same High Court which cannot be reconciled, obviously the Supreme Court decision has to be followed. Our View (In MAT 1446 of 2015) 54. The contention of the company is that the 1964 Standing Orders stipulate 58 years of age as the retirement age of the employees/workmen. Two extensions of one year each could be granted but it is nobody's case that such extensions were granted. The 1977 Standing Orders did not contain a clause relating to retirement of the employees and as such the 1964 Standing Orders would prevail. There was never any amendment to the 1964 Standing Orders following the procedure pres....
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....ich is capable of being computed in terms of money and if any question arises as to the amount of money due or as to the amount at which such benefit should be computed, then the question may, subject to any rules that may be made under this Act, be decided by such Labour Court as may be specified in this behalf by the appropriate government. Provided that where the presiding officer of a Labour Court considers it necessary or expedient so to do, he may, for reasons to be recorded in writing, extend such period by such further period as he may think fit." We are of the view that the claim of the writ petitioners projected in the present proceeding can be adjudicated properly, more conveniently and much more efficaciously by the Labour Court. It is the Labour Court which the writ petitioners should have approached instead of invoking the writ jurisdiction of this court. 57. The view we are taking is not only because of the existence of an alternative remedy. We are conscious that existence of an alternative remedy is not a complete bar to the maintainability of a writ petition. It is only a rule of self-imposed restriction that a court follows while exercising high prerogative w....
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....wages and other benefits of the writ petitioners beyond the age of 58 years. That would also result in unjust enrichment of the writ petitioners. These are questions of fact, determination whereof requires a full-fledged trial with witness action, for which the writ court is not the forum. Labour Courts have been set up to entertain and adjudicate upon precisely the kind of dispute that is involved in the present writ proceeding. 60. Mr. Sengupta, Learned Sr. Counsel has urged before us that a simple money claim cannot be the subject matter of a writ petition. He relied on the Supreme Court decision in the cases of M/s. Burmah Construction Company vs. The State of Orissa (supra) and Suganmal vs. State of Madhya Pradesh (supra). We are, however, not impressed with such submission. The aforesaid two decisions of the Apex Court do not lay down any absolute principle of law that a money claim cannot be made the subject matter of a writ petition. It is true that ordinarily a Writ Court would not entertain a petition under Art. 226 of the Constitution to enforce a civil liability arising out of a contract to pay money due to the claimant and would relegate the claimant to a civil suit. ....
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....t to the attention of the earlier Division Bench. In fact, the question of alternative remedy was not urged at all before the court in that matter. Further, the Supreme Court decision in the case of State of Assam vs. Barak Upatyaka D.U. Karmachari Sanstha (supra), was not placed before the Division Bench. None of the issues raised in the present proceeding were urged before the earlier Division Bench. In our opinion, the earlier Division Bench order was passed per incuriam and as is settled law, a judgment or order passed per incuriam does not create a binding precedent. No law has been laid down in the earlier Division Bench judgment. 64. In this connection one may refer to the decision of the seven Judges Bench of the Hon'ble Apex Court in the case of A.R. Antulay vs. R.S. Nayak, (1988) 2 SCC 602, wherein the Court observed that 'per incuriam' are those decisions given in ignorance or forgetfulness of some inconsistent statutory provision or of some authority binding on the Court concerned, so that in such cases some part of the decision or some step in the reasoning on which it is based, is found, on that account, to be demonstrably wrong. If a decision has been gi....
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....ot mean that the said judgment is affirmed by such dismissal. The order passed in any SLP at threshold without detailed reasons does not constitute any declaration of law or constitute a binding precedent, (see Union of India and others vs. Jaipal Singh 2003 (7) Supreme 676). This court cannot and does not reverse or modify the decree or order appealed against while deciding the petition for special leave to appeal and that too when the SLP was being dismissed. What is impugned before this Court can be reversed or modified only after granting leave and then assuming appellate jurisdiction over it. If the order impugned before this Court cannot be reversed or modified at the SLP stage obviously that order cannot also be affirmed at the SLP stage (see Kunhayammed and others vs. State of Kerala and another (2000) 6 SCC 359) and Sri Ramnik Vallabhdas Madvane and Ors. vs. Taraben Pravinlal Madhvani 2003 (8) Supreme 208)." In Union of India vs. Jaipal Singh, (2004) 1 SCC 121, the Supreme Court reiterated that an order rejecting a special leave petition at the threshold without detailed reasons therefor does not constitute any declaration of law by the Apex Court or constitute a binding ....
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....g on us as having been passed per incuriam as indicated above. The writ petitioners cannot base his case on an order passed earlier erroneously. Art. 14 of the Constitution cannot be invoked to enforce a negative right. In this connection reference may be had to the decision of the Hon'ble Supreme Court in the case of Indian Council of Agricultural Research vs. T.K. Suryanarayan (supra), wherein the Apex Court held that incorrect promotion either given erroneously by the department by misreading the Service Rules or pursuant to judicial orders contrary to Service Rules cannot be a ground to claim erroneous promotion by perpetuating infringement of statutory Service Rules. 69. For the reasons aforesaid this appeal succeeds. The judgment and order impugned is set aside. This will, however, not prevent the writ petitioners/respondents from approaching the appropriate forum to enforce their claim in accordance with law and the procedure contemplated. There will be no order as to costs. Our decision (In AAAT 1860 of 2015) 70. Since we have set aside the judgment and order impugned, this appeal becomes of academic interest. However, we wish to make same observations regarding the ....