Petitioners, retired from SIDKEL Television Ltd., challenged the rejection of their claim for enhanced VRS compensation, arguing they were entitled to incremental basic pay and DA applicable to Government employees despite the company's financial constraints.
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IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT :
THE HONOURABLE MR. JUSTICE S.SIRI JAGAN
FRIDAY, THE 1ST OCTOBER 2010 / 9TH ASWINA 1932
WP(C).No. 15727 of 2004(V)
----------------------------------------PETITIONER(S): ------------------------
1. C. RAVINDRANATH, S/O. P. ACHUTHAN NAIR, `ACHUTHAM', INDUSTRIAL ESTATE ROAD, MANJERI, MALAPPURAM DISTRICT, (RETD.MANAGER, SIDKEL TELEVISION LTD., MANJERI).
2. RAM MOHAN DAS. T.P., T.C.1/629, `JAGATHI', GURUVAYOOR ROAD, POONKUNNAM, THRISSUR. (RETD.ASSISTANT MANAGER, SIDKEL TELEVISION LTD., MANJERI.)
3. C.R. AMBIKA DEVI, W/O. SREEKUMAR, ANUGRAHA, ARATTUKADAVU JUNCTION, KOODAPPUZHA, CHALAKUDY, THRISSUR DISTRICT, PIN-680 307, (RETD.SUPERVISOR, SIDKEL TELEVISION LTD., MANJERI).
BY SRI.T.KRISHNANUNNI, SENIOR ADVOCATE
RESPONDENT(S):
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1. STATE OF KERALA REPRESENTED BY SECRETARY, INDUSTRIES DEPARTMENT, THIRUVANANTHAPURAM.
2. THE MANAGING DIRECTOR, KELTRON, THIRUVANANTHAPURAM.
3. THE MANAGING DIRECTOR, SIDCO, THIRUVANANTHAPURAM.
4. CHIEF EXECUTIVE, SIDKEL TELEVISION LIMITED, KELTRON HOUSE, VELLAYAMBALAM, THIRUVANANTHAPURAM.
R3 BY SRI. R.T. PRADEEP , SC, SIDCO
R4 BY. SRI.T.P.KELU NAMBIAR, SENIOR ADVOCATE, SRI.M.GOPIKRISHNAN NAMBIAR.
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 01/10/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
Kss
WPC.NO.15727/2004 V
APPENDIX
PETITIONER'S EXHIBITS:
RESPONDENT'S EXHIBITS: N I L
/TRUE COPY/
P.A.TO JUDGE
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S. SIRI JAGAN, J.
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Dated this the 1st day of October, 2010
J U D G M E N T
The petitioners were managerial and supervisory officers of a company jointly owned and promoted by two Government Companies namely 'KELTRON' and 'SIDCO'. The name of the company was SIDKEL Television Ltd. Like many other Government companies, immediately after incorporation of the company, the company went into very serious financial trouble. I am given to understand that, that company did not manufacture even one television. The employees were offered voluntary retirement under a Voluntary Retirement Scheme, Ext.P2. Petitioners accepted voluntary retirement on 30.04.2001. They were paid compensation for such voluntary retirement in accordance with Ext.P2 Scheme on 16.08.2001. Thereafter they took a contention that, the calculation of the compensation for VRS separation was not correctly done, insofar as
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increments due after 1996 and increase in D.A. after 1997 were not taken into account for the purpose of calculating the compensation. They approached this court by filing W.P.(C) No.39275/2003, in which by Ext.P4 judgment, the Government was directed to consider their grievance and pass appropriate orders. Pursuant to the same, by Ext.P5 order, Government rejected their claim. That is challenged
in this writ petition, by the petitioners, seeking the following reliefs:
“a. call for the records of this case leading upto Exhibit P.5 and quash the same by issuance of a writ of Certiorari or any other appropriate writ, order or direction;
b. pass an order declaring that petitioners are entitled to V.R.S. Compensation taking into account the D.A. and increment to which they are entitled to on the date of separation and also that are entitled to interest at the rate of 13% for the defaulted payments.
c. issue a writ of mandamus or any other appropriate writ, order or direction directing the 1st respondent to consider Exhibit P.3 representation afresh after affording an opportunity for hearing to the petitioners and;”
should have been increased by the increments which became due after 1996 and the D.A. should have been
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increased at the revised rate applicable to Government employees after 1997, which has not been done by the respondents.
considered as follows:
“Government have examined the matter in detail with reference to the report of the Managing Director, KSEDC and relevant records and found that VRS compensation was worked out taking in to account the total of Basic Pay, stagnation increment, Personal Pay, Dearness Allowance (Fixed & Variable) as eligible as on the date of separation by VRS. Since the SIDKEL employees were not sanctioned any D.A. with effect from 1997 and increment from 1996, their final settlement were made at the rates of DA and increments last drawn by them.
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The company was virtually in a closed condition without any operations and was not able to pay even the salary since 1996. No increments or DA were sanctioned to employees thereafter and so final calculations were made based on the sanctioned DA and increments prevailing as on the date of separation. There was no non-payment of compensation due to VRS to the petitioners. Compensation has been disbursed to them in instalments as and when the funds for the purposes were released. While sanctioning DA to State Government employees, it was clearly stated in Government Orders that in the case of Public Sector Undertakings where long term agreement exists by which the pre-revised scale plus DA was agreed to, the enhancement in DA can be allowed with the approval of board subject to financial viability till a fresh agreement is executed. The Board of Directors of the Company were not in a position to allow the increase in DA due to the non-availability of funds. As per clause 4.2 of the VRS notification the benefit under the scheme shall be final and would not be subject to any further adjustment at a later date due to change in the salary if any or any other reason.
In the circumstances stated above the request of S/Shri. C. Ravindranath, Ram Mohan Das and Smt. R. Ambika Devi is rejected.
In Ext.P2, Voluntary Retirement Scheme, the VRS compensation has to be calculated on the emoluments drawn by the employee. The term 'emoluments' has been defined in paragraph 2.3 of Ext.P2 thus:
“2.3 Emoluments means the sum total of Basic Pay, Stagnation increment, Personal Pay and Dearness Allowance (Fixed and Variable) as eligible on the date of separation of an employee from the service of the Company under the Scheme.”
In order to enable the petitioners to claim a larger compensation, petitioners have to satisfy this court that, as on the date of separation namely 30.04.2001, they were
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actually entitled to higher basic pay and DA than what has been reckoned as emoluments for the purpose of calculating their VRS compensation. The only contention of the petitioners is that, since after 1996 they were not paid any increments and after 1997 they were not given any increase in DA. Such increments and increase in DA should also go into calculation of their VRS compensation. I am of opinion that, for enabling the petitioners to claim so, they should satisfy this court that, as of right they were entitled to increments and increase in DA after 1996 and 1997 respectively, insofar as it is not disputed before me that, after 1996 no employee was given any increment and after 1997 no increase in DA was sanctioned to any employee of the company. The petitioners have not been able to satisfy me that, as of right the petitioners are entitled to yearly or other periodic increments in basic pay. The petitioners do not have a scale of pay. As is clear from Ext.P6 series, their basic pay has been fixed at a certain amount, on which DA is to be calculated. Therefore unless the Board of
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Directors of the company adopts a resolution to give increments to the employees, the employees cannot as of right claim increments in their basic pay. Of course, the learned counsel for the petitioners would submit that, the employees of the company are also entitled to increase in DA corresponding to increase in DA of Government employees. But it is evident from Ext.P5 that, in the Government orders giving increase in DA to State Government Employees, it was clearly stated that, in case of public sector undertakings, where long term agreements exist by which the pre-revised scale + DA was agreed to, the enhancement in DA can be allowed with the approval of Board subject to financial viability till a fresh agreement is executed. The petitioners have no case that, after 1997 the Board of Directors had approved revised DA to their employees in tune with the revised DA granted to State Government employees. Therefore the petitioners have no right as such to claim revised DA as applicable to State employees. In short, the petitioners have not been able to
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satisfy me that, after 1996 they had any right for further increments in the basic pay and after 1997 they had any right for increased DA. It is more or less admitted that, the financial condition of the company is worse than precarious. It is further admitted that, VRS compensation of the petitioners had been calculated on the basis of the basic pay and DA which the petitioners were drawing as on the date of separation. That being so, I do not find any merit in the writ petition and accordingly the same is dismissed.
S. SIRI JAGAN JUDGE
shg/
2 issues framed by the court
Whether petitioners are entitled to VRS compensation enhancement considering post-1996 increments and post-1997 DA increases applied to Government employees.
Whether petitioners had a statutory or contractual right to yearly increments in basic pay or revised Dearness Allowance as Government employees.
C. RAVINDRANATH
RAM MOHAN DAS. T.P.
C.R. AMBIKA DEVI
STATE OF KERALA REPRESENTED BY SECRETARY, INDUSTRIES DEPARTMENT, THIRUVANANTHAPURAM
THE MANAGING DIRECTOR, KELTRON, THIRUVANANTHAPURAM
THE MANAGING DIRECTOR, SIDCO, THIRUVANANTHAPURAM
S.SIRI JAGAN
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
