W. P. (S) No. 5204 of 2011 with W. P. (S) No. 6846 of 2011 An application under Article 226 of the Constitution of India ---- 1. Bharat Roy.
2. DebJayoti Bannerjee.
3. Baban Ram .....Petitioners ( in W. P. (S) No. 5204 of 2011) -Versus- 1. Union of India through Ministry of Heavy Engineering and Public Enterprises through its Secretary, Public Enterprises Bawan, New Delhi.
2. Garden Reachship Builders and Engineers Limited, Govt. of India, Kolkata (West Bengal).
3. Director (Personal), its office at 43/46, Garden Reach Road, Kolkata, West Bengal.
4. The General Manager (HR & A), having its office at 43/46, Garden Reach Road, Kolkata (West Bengal). ........Respondents ---- 1. Amal Kanti Nag. 2. Swapan Kumar Saha. 3. Anil Kumar Xalxo. 4. Somra Minj. 5. Sudhir Toppo. 6. Krishna Rao. 7. Smt. Maria Jacinta Tigga. 8. Miss Christina Purty. 9. Mourice Lakra. 10. Smt. Damyanti Sahu. 11. Nakul Patro. 12. Samiuddin. 13. Smt. Nirmala Tirkey. 14. Jena Oraon. 15. Arjun Oraon. 16. Sunil Hembrom .......Petitioners (W. P. (S) No. 6846 of 2011) Versus 1. Union of India, through the Secretary Ministry of Railway, Rail Bhawan Parliament Street, New Delhi. 2. The Secretary, Department of Public Enterprises, Ministry of Heavy Industries & Public Enterprises, Public Bhawan, New Delhi. 3. Garden Reach Ship Builders & Engineers Ltd., through its ChairmancumManaging Director at 43/46, Garden Reach Road, Kolkatta, West Bengal. 4. Director, Personnel, Garden Reach Ship Builders & Engineers Ltd., Kolkatta, West Bengal. 5. General Manager (HR& A), Garden Reach Road, Kolkatta, West Bengal. 6. Manager, HR ((HRIS), at 43/46, Garden Reach Road, Kolkatta, West Bengal. 2. 7. Deputy General Manager & Incharge (DEO), Garden Reach Ship Builders & Engineers Ltd. .......Respondents. For the Petitioners : M/s. Delip Zerath, Adv. & Amit Kumar Das, Adv. For the Respondent nos. 2 to 4 : M/s. Anil Kumar Sinha, Sr. Adv. Manjul Prasad, Sr. Adv. Delip Kumar Prasad, Adv. Arbind Kumar Sinha, Adv. (W.P.(S) No. 5204/11) For Respondent nos. 3 to 7 : M/s. Anil Kumar Sinha, Sr. Adv. Manjul Prasad, Sr. Adv. Delip Kumar Prasad, Adv. Arbind Kumar Sinha, Adv. (W.P.(S) No. 6846/11) --- PRESENT HON’BLE MR. JUSTICE APARESH KUMAR SINGH By Court Petitioners in W.P.(S) No. 5204 of 2011 have retired on reaching their age of superannuation i.e., on 30th April, 2010 in respect of petitioner nos. 1 and 3 and 1st January, 2009 in respect of petitioner no. 2 while holding the post of Charge man and Assistant Personal (HR) under the Respondent Garden Reach Ship Builders and Engineers Limited. 2. Petitioners in W.P.(S) No. 6846 of 2011 have accepted Voluntary Retirement and all 16 petitioners have separated from the Company on acceptance of their applications with effect from 31st October, 2009 as per Chart enclosed at Para 5 of their writ petition. They were working in various capacity such as Assistant, Fitter, Pipe Fitter, Clerk, Welder Gas Cutter, Machinist, Store Keeper and Rigger.
3. Essentially, the reason for the petitioners in both the writ petitions for being aggrieved is the enhancement of gratuity amount from Rs. 3.5. Lakhs to Rs. 10 Lakhs implemented by the RespondentOrganization in respect of executive and nonunionized Supervisors with effect from 1st January, 2007. Petitioners admittedly are unionized employees i.e., belonging to Operatives and Clerical category in respect of whom the enhancement to Rs. 10 Lakhs of gratuity has been enforced with effect from 24th May, 2010 upon the Gazette Notification of Payment of Gratuity (Amendment) Act, 2010 (No. 15 of 2010) in Section 4(3) of the Parent Act. Petitioners have questioned the enhancement of gratuity to the executive 3. and nonunionized supervisors from the prior date 1st January, 2007 on grounds of unreasonable classification. They allege discrimination when all the employees of the RespondentCompany are governed by the same Payment of Gratuity Act, 1972. 4. Petitioners in the first writ petition have placed the order dated 29th October, 1988, whereunder the gratuity amount was enhanced from Rs. 1 Lakh to Rs. 3.5 Lakhs with effect from 24th September, 1997 in respect of all employees under the RespondentOrganization. This enhancement apparently was on account of the amendment in the Payment of Gratuity Act, 1998 in the quantum of Gratuity amount payable. 5. Counsel for the writ petitioners has alleged that there are no rationale behind making such an arbitrary and unreasonable classification in enhancement of gratuity amount visavis the executives and non unionized supervisors/employees with the petitioners who are non unionized employees. Reliance has been placed upon the judgment rendered by Hon'ble Supreme Court in the case of Grand Kakatiya Sheraton Hotel and Towers Employees and Workers Union vs. Srinivasa Resorts Limited and others reported in 2009 SC 2337. Counsel for the petitioners in the second writ petition have also challenged the office memorandum dated 26th November, 2008 issued by Ministry of Heavy Industries & Public Enterprises, which is the basis of the enhancement of gratuity amount to such employees with effect from 1st January, 2007, as it is discriminatory. They have also laid challenge to the circular dated 2nd August, 2010 (Annexure6) issued by the Manager (HR) (HRIS) of RespondentOrganization, whereby gratuity limit from Rs. 3.5 Lakhs to Rs. 10 Lakhs has been restricted to the Board Level and below Board Level and nonunionized employees/supervisors only, with effect from 01.01.2007 Petitioners herein have also questioned the fixation of cutoff date as arbitrary and discriminatory being violative of Fundamental Right guaranteed under Articles 14 and 16 of the Constitution of India. Letter 4. dated 19th February, 2011(Annexure9) rejecting their demands have also been challenged. All these petitioners have sought similar benefits of enhanced gratuity at par with executive and nonunionized supervisors/employees. They have also sought other retiral benefits including medical benefits. 6. Learned counsel for the petitioners in the second writ petition has also referred to the Voluntary Retirement Scheme (Annexure1), whereunder on pay revision with effect from 1st January, 2007, exgratia would be recalculated and difference would be paid subsequently. All other statutory dues on separation will be paid in addition to the V.R.S. compensation. He has also placed provisions of the Wage Agreement entered into between the Trade Union and the employer enclosed to the counter affidavit of the respondents, whereunder at Clause 59, it is provided that gratuity shall be paid as per the provision of the respective Acts and Rules as notified/amended by the Government of India from time to time. Learned counsel for the petitioners has placed reliance upon the following judgments rendered by Hon'ble Supreme Court in support of his submissions: (i) State of Punjab vs. Justice S. S. Dewan (Retired Chief Justice) and others reported in (1997) 4 SCC 569 and ii) D. S. Nakara and othersvs. Union of India reported in (1983) 1 SCC 305 paragraphs 49 to 60. Essentially, the challenge is based on grounds of unreasonable classification and discrimination. 7. Respondents have appeared and filed their counter affidavit in both the cases. Learned Senior counsel for the respondents has placed the relevant material facts relating to the dates of retirement/acceptance of V.R.S by the petitioners in both the writ petitions. He has also referred to the notification, whereunder the amendment in the Payment of Gratuity Act has been enforced with effect from 24th May, 2010 in the matters of enhancement of gratuity amount to Rs. 10 Lakhs (Annexure4 to the second writ petition). Learned counsel for the respondents has drawn 5. clear lines in the class of employees, who have been granted enhancement of gratuity with effect from 1st January, 2007 as they belong to the category of executive and nonunionized supervisors distinct from the petitioners, who are nonunionized employees whose pay structure and other service conditions are governed by the Wage Agreement entered into between the Management and their Trade Union. Learned counsel for the respondents have vehemently submitted that no parity can be drawn between the petitioners with those employees as they formed distinct class. Therefore, no case of unreasonable classification or discrimination is made out. All these employees either by virtue of acceptance of V.R.S or on their retirement before the cut off date 24th May, 2010 cannot claim any enhanced gratuity by treating the Amendment Act in a retrospective manner. 8. Learned counsel for the respondents has relied upon the judgments rendered by Hon'ble Supreme Court in the case of Hari Ram Gupta (D) Thr. L. R Kasturi Devi vs. State of U.P. reported in AIR 1998 SC 2483 para 7 and 10 and in the case of ViceChairman and Managing Director, A. P. Sidc Ltd. and another reported in (2003) 11 SCC 572 Para 12 in support of his submission that after superannuation and/or acceptance of V.R.S and on cessation of employeeemployer relationship, petitioners cannot claim the benefit of any enhanced gratuity enforced after their retirement. It is also submitted that challenge to the notification of the Government of India dated 26th November, 2008 has been made much after their retirement in 2009 and 2010. The present writ application preferred in 2011 suffers from delay as well. It is also the case of the respondents that persons affected on the adjudication to the challenge of office memorandum dated 26th November, 2008 have not been impleaded even in representative capacity, though they are beneficiaries of the enhanced gratuity amount. It is emphasized on their part that pay structure of the executive and nonunionized supervisors are guided by the 6. implementation of the pay structure recommended by the Central Pay Commission through the Parent Ministry of Heavy Industries & Public Enterprises. No case of parity can be drawn by the petitioners. 9. I have considered the rival submission of the parties and gone through the relevant materials on record. As it appears that enhancement of gratuity on the previous occasion to Rs. 3.5. Lakhs vide order dated 29th October, 1998 (Annexure3) was brought into the effect only upon the amendment carried out in the Payment of Gratuity Act in the year 1998. It applies to all employees of the organization. The petitioners have been persuaded to draw parity with executive and nonunionized supervisor on the premise that there were no distinction between the different hierarchy and Grades of employees in the matter of gratuity as all are covered under the provisions of Payment of Gratuity Act, 1972. However as is borne out from the pleadings on record, it cannot be disputed that the pay structure and pay revision of executives, Board level employees, below Board level employees and nonunionized supervisors are guided by pay revisions effected on the recommendation of the Pay Commission through the Ministry of Heavy Industries & Public Enterprises. The pay structure, revision and other services conditions of such employees are not guided by any settlement or wage agreement entered into between the management and their trade Union as is the case in respect of petitioners who are unionized employees. It is informed by learned counsel for the petitioners that wage agreement are entered at intervals of 5 or 10 years between the management and employee union. The Wage agreement which these petitioners are guided by, was last entered on 5th March, 2001 effective from 1st January, 1997 for a period of 10 years as would be evident from the memorandum of settlement (AnnexureE/3) to the counter affidavit of respondent nos. 3 to 7 in W.P.(S) No. 6846 of 2011. The instant memorandum of settlement has been signed on 26th May 2010 and revision of wage and other benefits have been made effective from 1st January, 2007. The provisions at Clause 59 of the instant memorandum of 7. settlement which relates to gratuity provides that it shall be paid as per the provision of the respective Acts and Rules as notified/amended by the Government of India from time to time. The amendment in the Payment of Gratuity Act through Act 15 of 2010 has been brought into force with effect from 24th May, 2010 in exercise of powers conferred Sub Section (2) of Section 1 of the Act. The amendment is prospective in nature and as per the provisions of Clause 59, enhancement of gratuity to all such employees covered under the Memorandum of Settlement dated 26th May, 2010 would be operative from the date of notification i.e. 24th May, 2010. None of the serving employees have come before this Court alleging discrimination on the enhancement of gratuity of the executive and non unionized supervisors/employees made effective from 1st January, 2007. 10. It is therefore evident that there is a distinct intelligible differentia between two classes i.e. executive and nonunionized supervisor/other employees compared with the petitioners and others who are unionized employees and are governed by Wage Agreement/ settlement entered into under the provisions of Industrial Disputes Act and the Rules framed thereunder between the management and labour union. As is evident from the office memorandum dated 26th November, 2008 issued by Ministry of Heavy Industries & Public Enterprises (AnnexureG2) to the counter affidavit of respondent no. 2 to 4 in the first writ petition (Annexure14 to the second writ petition) that the last revision of the scale of pay of below board level and Board Level executive and nonunionized supervisors in Central Public Sector Enterprises was made effective from 1st January ,1997 for a period of 10 years. As the next pay revision fell due from 1st January, 2007, Pay Revision Committee was set up under the Chairmanship of Justice M. Jagannadha Rao, Retd. Judge of Supreme Court of India to recommend revision of pay and allowances for above categories of employees following IDA pattern of pay scales. The Government has after consideration of the recommendation taken the decision in respect of the revision in pay scale in the manner prescribed in 8. the said office memorandum. Clause 13 of the said office memorandum relates to Gratuity; The ceiling of gratuity of the executives and non unionized supervisors of the CPSEs would be raised to Rs. 10 lakhs with effect from 1st January, 2007. As per Clause 16, the financial implication of the pay revision are to be borne by the concerned CPSE from their own resources and no budgetary support were to be provided. 11. As has been discussed hereinabove classification is writ large in the two categories of the employees i.e., board level official, executive and non unionized supervisor and those unionized employees, to which category the petitioners belong. Therefore, the plea of the petitioners of unreasonable classification or discrimination is not at all made out. Both the categories of employees are governed by different structures and pay revisions arrived at in a different manner and methodology. Therefore, no parity can be drawn by the petitioners with the executive and non unionized supervisors /employees of the RespondentCompany. 11. The petitioners in the second writ petition have raised a plea for benefits of pay revision implemented with effect from 1st January, 2007. It is to be noted that under the wage agreement entered on 26th May, 2010 any enhancement of gratuity under Clause 59 could only be as per the provisions of respective Acts and Rules as notified by the Government of India from time to time. The Government of India has notified the amendment in the Payment of Gratuity Act with effect from 24th May, 2010 by enhancement the gratuity limit to Rs. 10 lakhs. This cannot be meant to operate retrospectively. The said notification is also not under challenge. 12. In such circumstances the plea of the petitioners for any enhanced gratuity on these grounds are not found tenable in law and on facts. The judgment relied upon by the petitioners do not apply in the aforesaid state of facts, as the petitioners are distinct class from the Board Level official, executive and nonunionized supervisors. Any benefits of enhancement of gratuity from the prior date cannot be claimed relying on those 9. decisions as the amendment in the Payment of Gratuity Act has been made effective from 24th May, 2010 i.e., from a date after their retirement or acceptance of V.R.S. 13. In view of the detailed discussions made hereinabove and the reasons recorded, the petitioners have failed to make out a case for any interference in the matter. Accordingly, the writ petitions are dismissed. (Aparesh Kumar Singh,J) Jharkhand High Court, Ranchi The 27th November, 2015. JK/Kamalesh/ NAFR