® 1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE27H DAY OF JULY, 2016 BEFORE THE HON’BLE MR.JUSTICE B.S.PATIL W.P.No.15448/2008 (S-R) & W.P.Nos.16153-59/2008 (S-R) BETWEEN1 THE WORKMAN OF MANDYA NATIONAL PAPER MILLS, REP BY THE SECRETARY OF NATIONAL PAPER MILLS WORKMEN UNION, ASHOKPURAM, MYSORE.
2. M/s MANDYA NATIONAL PAPER MILLS OFFICERS GUILD, REP BY ITS GENERAL SECRETARY, NO.22, 3RD MAIN, YADAVAGIRI, MYSORE570020.
3. M/s MANDYA NATIONAL PAPER MILLS STAFF UNION, REP BY ITS SECRETARY, NO.576, MIG-I, HUDCO, HEBBAL III STAGE, METAGALLI POST, MYSORE570016.
4. Mr. PRAKSH S/O N.K.HANUMANTHEGOWDA AGED ABOUT49YEARS, NO.22, 3RD MAIN, YADAVAGIRI MYSORE570020.
5. Mr. P.K.KYATHAIAH, S/O KYATHAIAH, AGED ABOUT56YERAS, R/AT KONNANAHALLI POST, 2 PANAKANAHALLI MANDYA TALUK, MANDYA DISTRICT571403 6. Mr.P.RAJASHEKAR S/O PAPAIAH AGED ABOUT48YEARS, SHARADA NILAYA NO.202, 9TH CROSS, GOKULAM3D STAGE, MYSORE570002.
7. Mr M.LOKESH S/O LATE A.M. MALLAIAH DOORNO.169, PETE VOKKALIGARA STREET, MALAVALLI571430, MANDYA DISTRICT.
8. Mr. JOBA SALDANA AGED ABOUT52YERAS, S/O CHARLES SALDHANA DOOR NO.576, MIG-1, HEBBAL3D STAGE, METAGALLI POST, MYSORE570016. ... PETITIONERS (BY SRI M.NARAYANA BHAT, ADV. FOR SRI SUBBA RAO & CO., ADVS.) AND1 THE UNION OF INDIA, REP BY ITS SECRETARY, MINISTRY OF HEAVY INDUSTRIES, NEW DELHI.
2. HINDUSTAN PAPER CORPORATON LTD., (GOVERNMENT OF INDIA ENTERPRISE) REP BY ITS CHAIRMAN AND MANAGING DIRECTOR, NO.5, RUBY BUILDING, PARK STREET, KOLKATA700016.
3. 3 THE MANDYA NATIONAL PAPER MISSL (IN LIQUIDATION), REP BY THE OFFICIAL LIQUIDATOR, 17TH FLOOR, RAHEJA TOWERS, M.G.ROAD, BANGALORE – 01. (AMENDED VIDE COURT ORDER
DT.28.4.2015) ... RESPONDENTS (BY SRI ANIAN JOSEPH, CGC FOR R1; SRI ARVIND MOORCHUNG, ADV. FOR M/s. KING & PARTRIDGE, FOR R2 SRI K.S.MAHADEVAN, ADV. FOR R3) THESE WRIT PETITIONS ARE FILED UNDER ARTICLES226& 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE REPLY DT.5.2.2007 MARKED AT ANNEX-E AS THE SAME IS ARBITRARY, ILLEGAL AND VIOLATIVE OF ARTICLES14 16 AND21OF THE CONSTITUTION AND ETC. THESE PETITIONS COMING ON FOR FINAL HEARING THIS DAY, THE COURT MADE THE FOLLOWING: ORDER
1 All the petitioners were employees of Mandya National Paper Mills (for short ‘MNPM’). It was a company incorporated under the provisions of the Companies Act. It suffered huge loss. In order to extend certain benefits to employees working therein, Central Government issued official memorandum dated 05.05.2000 vide Annexure-B. This was a voluntary retirement scheme applicable to all sick units. The said scheme was by 4 way of an amendment to the earlier scheme dated 05.10.1988. The Government had kept in mind interest of both employees and the need to enable public sector enterprises to rationalise their surplus manpower.
2. Relevant clause in the said scheme (Annexure-B) for the purpose of this case is clause (5). It states that for sick and unviable units, the VSS package of the department of heavy industry would be adopted. As a corollary, the VSS scheme was modeled on Gujarat pattern. However, employees were required to opt for VSS within three months from the date of offer failing which they would be eligible only for retrenchment compensation.
3. As this scheme was made applicable to 3rd respondent – Company, all employees either through their representative union or on their own sought for benefit of voluntary retirement by applying within three months from 05.05.2000. It thus follows that on or before 05.08.2000, all employees of MNPM sought benefit of the scheme. They were indeed paid monetary benefit as per the scheme.
4. 5 On 06.11.2001 by an official memorandum issued by the Government of India, the scheme was revised with immediate effect. The Revised Voluntary Retirement Scheme for central PSUs was introduced as per official memorandum dated 05.05.2000. Clause (a) of the official memorandum stated as under. “Ex-gratia payment in respect of employees on pay scales at 01.01.87 and 01.01.92 levels, computed on their existing pay scales in accordance with the extant scheme, shall be increased by 100% and 50% respectively”. Clauses (4) and (5) read as under: “4. The employees, who have already been released by the PSUs before the date of issue of this O.M., shall not be covered under the modified scheme.
5. The administrative ministries/departments are required to bring the modified VRS/VSS to the notice of the public enterprises under their administrative control and ensure strict compliance with the provisions of the scheme”.
5. It is thus clear that ex-gratia amount payable in respect of employees who were on the pay scales admissible as on 6 01.01.1987 was increased by 100% and the ex-gratia payment payable in respect of employees who were receiving revised pay scale as on 01.01.1992 was increased by 50%. It was specifically made clear in clause (4) that employees who had been already released by the PSUs before the date of issue of official memorandum dated 06.11.2001 shall not be covered under the modified scheme.
6. Contention of the petitioners in these writ petitions is that though they were released prior to the date of official memorandum dated 06.11.2001, benefit of revised official memorandum in the matter of increased ex-gratia payment by 100% and 50% respectively was applicable to petitioners as well. According to them, clause (4) of the official memorandum dated 06.11.2001 is illegal being discriminatory and violative of Article 14 of the Constitution of India. In support of this contention, learned counsel for petitioners has placed reliance on the following judgments of the Apex Court: (a) A.K.BINDAL VS. UNION OF INDIA – AIR2003SC2189 (b) K.J.S.BUTTAR VS. UNION OF INDIA AND ANOTHER – 2011 AIR SCW2132and 7 (c) KALLAKKURICHI TALUK RETIRED OFFICIALS ASSOCIATION, TAMIL NADU AND OTHERS VS. STATE OF TAMIL NADU – 2013 (2) SCC7727. Learned counsel representing the 2nd respondent also places reliance on the judgment of the Apex Court in the case of A.K.BINDAL VS. UNION OF INDIA – AIR2003SC2189apart from inviting attention of the Court to the judgment in the case of HEC VOLUNTARY RETIRED EMPLOYEES WELFARE SOCIETY AND ANOTHER VS. HEAVY ENGINEERING CORPORATION LIMITED AND OTHERS – AIR2006SC1420to contend that benefit of revised voluntary retirement scheme floated by the Union government vide official memorandum dated 06.11.2001 long after petitioners opted for voluntary retirement and went out of service of MNPM had no application and petitioners cannot claim any right based on the same.
8. Upon hearing the learned counsel for both parties and on careful consideration of the entire materials on record, it emerges that MNPM where petitioners had been engaged was suffering loss. Winding up proceedings were initiated having regard to the recurring loss sustained by the Company. It is stated at the bar that eventually the company was wound up. It 8 is in the background of loss suffered by the Company, employees engaged in the company were offered benefit of voluntary retirement as per the scheme prevalent at the relevant time and in terms of the official memorandum dated 05.05.2000 issued by the Union of India produced at Annexure- B. As per the said scheme, vide clause (5) employees were required to opt for voluntary retirement scheme within thee months from the date of offer failing which they would be eligible for retrenchment compensation and not for benefit of voluntary retirement.
9. All the employees of MNPM opted for benefit under the scheme by applying for the same within the period of three moths. They have received the benefit payable under the scheme and have walked out of the company. Thereafter, when the Union of India revised the voluntary retirement scheme by issuing another official memorandum dated 06.11.2001 whereby ex-gratia payment was increased by 100% to persons who were on the pay scales admissible as on 01.01.1987 and 50% to employees who were on the pay scales admissible as on 01.01.1992, they have made the claim for payment of increased 9 ex-gratia amount in terms of the modified official memorandum dated 06.11.2001.
10. It has been made clear in the official memorandum dated 06.11.2001 that it shall not be applicable to employees who had been already released by the public sector undertakings before the date of issue of the said official memorandum. Such a clause, according to petitioners, is discriminatory and is violative of Article 14 of the Constitution of India. This contention cannot be accepted. In the case of A.K.BINDAL VS. UNION OF INDIA, the Apex Court while considering a similar contention urged on behalf of the employee that there could be no waiver of fundamental rights and that even if an employee had opted for voluntary retirement scheme and had taken the amount and left the company, it did not mean that he had foregone his right to claim the salary which he was entitled during the period when he was an employee of the company, the Apex Court has stated in paragraphs 31 to 34 that the employees who accepted voluntary retirement scheme with their eyes open without making any kind of protest regarding their past rights based upon revision of pay scale would not be permitted to raise such contentions once they walk out of the 10 company by receiving the entire amount with a golden hand shake.
11. The main purpose of paying the amount to the employees of MNPM based on the voluntary retirement scheme was to bring about a complete cessation of jural relationship between the employer and the employee and once the amount was paid and the employee ceases to be under the employment of the company, there was no question of the employee again agitating for any kind of his past rights much less based on a subsequent official memorandum issued by the Union Government specifically making it clear that it was not applicable to the employees who had been already released from service under the previous scheme.
12. Even if petitioners had been agitating their grievance with regard to revision of pay scale as has been contended in the present case, that would not clothe them with any right to seek the benefits as per the subsequent official memorandum issued vide Annexure-C. Reliance placed by the learned counsel for petitioners on the judgment of the Apex Court in the case of K.J.S.BUTTAR VS. UNION OF INDIA AND ANOTHER is not apposite to the questions raised and the facts and 11 circumstances involved in the present case. That was a case where a retired army official who retired on medical grounds had sought for benefits flowing from circulars that had been issued subsequent to his retirement. It was not a case of employee of a sick unit opting for voluntary retirement scheme and severing his relationship with the company by accepting all benefits. The other judgment on which the petitioner has placed reliance in the case of KALLAKKURICHI TALUK RETIRED OFFICIALS ASSOCIATION, TAMIL NADU AND OTHERS VS. STATE OF TAMIL NADU has also no application to the facts of the present case.
13. Yet another contention urged by learned counsel for petitioner is that subsequent official memorandum was only a modification of the earlier official memorandum providing for voluntary retirement benefit under voluntary retirement scheme and therefore, as long as it was a modification of the earlier scheme, benefit of the modified scheme would be always applicable to the employees who had opted for retirement under the old scheme. The said contention is impermissible in the facts of the present case because benefit of revised official memorandum dated 06.11.2001 is not made applicable to the 12 employees who had already been released under the earlier scheme by receiving benefits as per the express clause incorporated in the scheme. Hence, the petitions being devoid of merit are dismissed. Sd/- JUDGE VP