Dismissed

K. Srinivasan v. the Chairman & Managing

Madras HC9 Aug 2011WP/21134/2001

Case brief

AI extract

What is this about?

The Madras High Court dismissed a writ petition challenging rejection of voluntary retirement under UCO Bank's VRS 2000. The court upheld the bank's absolute discretion to reject applications based on administrative criteria, upheld the rejection reason regarding lack of one-year service in the new scale, and held the petitioner was estopped after accepting retirement under a different regulation.

What the court decided

AI extract

K. Srinivasan Vs the Chairman & Managing — Pension and Retirement Benefits | Madras HC (2011)

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IN THE HIGH COURT OF JUDICATURE AT MADRAS

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DATED:09.08.2011

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Coram:

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THE HONOURABLE MR. JUSTICE T.S.SIVAGNANAM

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W.P. No. 21134 of 2001

K.Srinivasan

.. Petitioner

vs.

1.The Chairman and Managing Director, UCO Bank, No.10, Biplapi Trilokia Maharaj Sarani, (No.10, Brabourne Road), Calcutta – 700 001. 2.The Deputy General Manager, (Personal) UCO Bank, No.12, Old Court House Street, Calcutta – 700 001.

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3.The Secretary, Ministry of Banking, New Delhi. .. Respondents

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Prayer: Writ Petition filed under Article 226 of the Constitution of India, praying for the issuance of Writ of Certiorarified Mandamus to call for the records of the first respondent vide letter PER:V.R.S.2001/1588 dated 10.03.2001, quash the same and direct the respondents herein to pay the monetary benefits accrued as applicable under the VRS Scheme 2000 as per Circular No.CHO/PMG/19/2000, dated 16.11.2000.

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For Petitioner : Mr.G.R.Lakshmanan

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For Respondents : Mr.S.Kothandaraman for RR1&2

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O R D E R

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The prayer in the writ petition is to quash an order passed by the first respondent dated 10.03.2001, by which, the first respondent rejected the petitioner's application for voluntary retirement from service of the respondent bank, and for a direction to the respondents to pay monetary benefits to the petitioner applicable under the Voluntary Retirement Scheme 2000, as per circular dated 16.11.2000.

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https://hcservices.ecourts.gov.in/hcservices/

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Some factual background would be necessary before we approach the controversy in issue. The petitioner was employed as a chief officer in the respondent bank and was serving in Calcutta during 2000. The bank issued a circular on 16.11.2000, announcing the UCO Bank Employees Voluntary Retirement Scheme, 2000 (hereinafter referred to as the 'VRS 2000'). It is to be noted that under the Pension Regulation, 1995, of the respondent Bank, there was a provision for voluntary retirement. The petitioner submitted his application on 19.02.2001, requesting to be retired voluntarily under the VRS 2000. According to the petitioner, the application for voluntary retirement has to be considered by the competent authority on the basis of 'First cum First Served' and the petitioner claimed that he was the 9^th applicant under the scheme and though, this scheme stated that it is on first cum first served basis, the respondent ignored the same and rejected the petitioner's application on grounds, which were not contemplated under the scheme. The petitioner thereafter submitted an application for voluntary retirement under the UCO Bank Employees Pension Regulation, 1995, and the said application was accepted and he was voluntarily retired from service on 10.07.2001. The petitioner after retirement has challenged the order of rejection, dated 10.03.2001, rejecting his application under the VRS 2000.

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The learned counsel for the petitioner primarily questioned the correctness of the impugned order on four grounds. Firstly by contending that the order of rejection dated 10.03.2001 is contrary to terms of the VRS 2000 and First cum First Served Rule was violated and as per the scheme, there is no discretion vested with the authority for refusing to accept the petitioner's request for voluntary retirement. Secondly, it was contended that it has been mentioned in the impugned order that the petitioner's request could not be considered, since he has not completed one year of service in scale IV. This according to the petitioner is not a condition precedent under the scheme, therefore, the order of rejection is unsustainable. Thirdly, it is submitted that under the scheme, the competent authority to approve the proposal, is the Government of India and therefore, even for rejection, the approval from the Government is necessary and the order passed by the first respondent is without jurisdiction. Lastly, the learned counsel contended that there has been discrimination in the manner in which the VRS 2000 was implemented and there was gross discrimination and the petitioner in the affidavit filed in support of the writ petition pointed out four instances and alleged that the terms of the scheme were violated.

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The learned counsel for the respondent bank by relying upon the counter affidavit submitted that the writ petition is not maintainable, since the petitioner has already voluntarily retired

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from service under the UCO Bank Employees Pension Regulation, 1995 and relieved from the services of the bank with effect from 10.07.2001 and after his retirement cannot question the earlier order of rejection under the VRS 2000. It is further contended that under the scheme, there is absolute discretion vested with the respondent bank and the competent authority to reject the request is the Chairman and Managing Director and the order of rejection was passed by the competent authority and there is no error. It is further submitted that after the VRS 2000 was introduced, 4966 applications for voluntary retirement was received and therefore, the respondent bank took a decision among other things holding that executives, who have been recently promoted and not completed one year in their new scale, will not be considered for voluntary retirement under the scheme. Therefore, it is stated that the reason assigned in the impugned order is fully justified. The learned counsel by relying upon the paragraph 9 of the counter affidavit submitted that there is no discrimination in the manner in which, the scheme was implemented and therefore, there is no error in the impugned order of rejection.

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I have carefully considered the submissions on either side and perused the materials available on record.

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The retirement benefits of the employees of the respondent bank are governed by the UCO Bank Employees Pension Regulation, 1995, (hereinafter referred to as the 'Pension Regulation') under Regulation 29(1) on or after 1^st November, 1993, at any time after an employee has completed 20 years of qualifying service he may, by giving notice of not less than three months in writing to the appointing authority retire from service. In terms of Regulation 29 (2), the notice of voluntary retirement given under sub-regulation (1) of regulation 29 shall require acceptance by the appointing authority. Admittedly, this regulation also covered the case of the petitioner. During 2000, the respondent bank introduced a scheme of Voluntary Retirement called as "UCO Bank Employees Voluntarily Retirement Scheme, 2000 (VRS 2000)" with a view to downsize the workforce and achieve a proper age profile and creating opportunities for lateral as well as vertical career progression. In terms of clause 5.1 of the scheme, all permanent full time employees of the bank were eligible to seek for voluntary retirement, provided they have completed 15 years of service or 40 years of age. Under clause 9, competent authority to accept the voluntary retirement insofar as officers in scale IV and above was the Chairman and Managing Director. For the present case, clause 10.6 would be relevant and for better appreciation, the same is quoted below:-

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10.6. The Competent Authority shall have absolute discretion either to accept or reject the request of an employee seeking Voluntary Retirement under the

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https://hcservices.ecourts.gov.in/hcservices/

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scheme depending upon the requirement of the Bank. The reasons for rejection of request of an employee seeking voluntary retirement shall be recorded in writing by the competent authority. Acceptance or otherwise of the request of an employee seeking voluntary retirement will be communicated to him in writing."

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Thus, it is evident that the competent authority under the scheme has absolute discretion either to accept or reject the request of an employee, seeking voluntary retirement under VRS 2000, depending upon the requirement of the bank. The competent authority was required to record reasons in writing if request is rejected. Therefore, the petitioner's contention that his application on being submitted under VRS 2000, should automatically be accepted on first cum first served basis is incorrect. The competent authority has enough and more jurisdiction and discretion to either accept or reject the request of the employee seeking voluntary retirement.

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In the impugned order of rejection, it has been stated that the petitioner was promoted from scale III to scale IV w.e.f. 13.03.2000 and he did not complete one year of service in scale IV as on 01.01.2001 and as per the objective criteria framed by the bank, it was decided by the competent authority to retain the petitioner in the bank services. According to the learned counsel for the petitioner, there is no such condition in the VRS 2000, that a person seeking voluntary retirement should have completed one year of service in a particular scale. It is seen that in terms of clause 10.20 of the scheme, the bank reserves the right to withdraw the scheme at any time it thinks fit and its decision in this respect will be final. After the 2000 scheme was announced, it is stated that 4966 applications were received of which, 2800 applications where from persons in the officers cadre after which several issues were raised by the Employees Union/Association and certain amendments were brought to the scheme by given an option to the employee to withdraw during the operation of the scheme before his application is accepted and such other matters. Further, a condition was imposed in respect of voluntary retirement applications received from executives which would be subject to objective assessment criteria, in terms of the decision taken in the corporate policy committee meeting held on 04.01.2001. In terms of the objective assessment criteria according to the banks manpower plan submitted to the Ministry, positions in senior management scale IV & V and top management scales VI & VII has not indicated any surplus and hence VRS applications received from the executives are required to be considered strictly on the banks administrative and business requirement and one of the conditions in the objective assessment criteria rules is as hereunder:-

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"Executives who have been recently promoted and not completed one year in their new scales will not be considered for voluntary Retirement under the scheme."

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Therefore, the above is part of a condition for assessing an request for voluntary retirement and if the concerned applicant, who is an executive of the bank has not completed one year in the recently promoted scale, he shall not be entitled for being considered for voluntary retirement. Admittedly, the petitioner did not question this condition imposed for assessment of the application for voluntary retirement. Therefore, the respondent bank was fully justified in observing that the petitioner does not fulfill the above one year criteria.

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A contention was raised on behalf of the petitioner stating that even an order of rejection has to be passed with the approval of the Central Government. In my view, this contention is not tenable, as there is no such condition under the scheme. As noticed above, the competent authority as defined under clause 9 of the scheme shall have absolute discretion either to accept or reject the request of an employee seeking voluntary retirement. In terms of clause 10.21 only in cases where acceptance of voluntary retirement from officers of scale IV and V and top management scales VI & VII would be subject to approval of Government of India, Ministry of Finance. Therefore, the order of rejection passed by the competent authority does not suffer from lack of jurisdiction and the competent authority was entitled to pass an order of rejection, and it does not require the approval of the Government of India.

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An allegation of discrimination was raised by the learned counsel for the petitioner pointing out names of four officers, whose applications were favourably considered under the VRS 2000. The respondent bank in their counter affidavit have set out the reasons as to why the applications of the said four persons were accepted. Out of the four persons, three persons were seriously sick unable to attend to the office work and frequently remained absent on leave and the 4^th individual's wife was suffering from cancer and getting treatment at Chennai. Therefore, the respondent bank seek to justify their action by stating that on account of the peculiar facts and circumstances those four persons were given voluntary retirement under VRS 2000. The reasons given by the respondent bank appears to be genuine and convincing and therefore, it is held that the plea of discrimination is not established nor there is any error or unreasonableness in the exercise of discretion in their favour. In any event, the petitioner has no vested right to seek for voluntary retirement and it is purely at the discretion of the respondent bank.

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https://hcservices.ecourts.gov.in/hcservices/

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At this stage, it is useful to refer to the observations of the Hon'ble Supreme Court in Indian Overseas Bank v. Tribhuwan Nath Srivastava, (2011) 7 SCC 475, while consider the object and purpose of a similar voluntary retirement scheme in another nationalized bank, which is to the following effect:-

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We feel that the High Court committed the fundamental mistake in completely misconstruing the object and purpose of the voluntary retirement Scheme. As wrongly assumed by the High Court, the object of the Scheme was not to reward the good officers or to punish the bad ones. Even though depending upon personal circumstances, voluntary retirement under the Scheme might have appeared to some individual officers as personally beneficial, it was not envisaged by the Bank as a means to give personal rewards or to punish individual employees by granting or refusing to grant voluntary retirement to them. The objective of the Scheme as stated in the circular issued by the Bank was “to adopt measures to have optimum human resources at various levels in keeping with the business strategies, skill profile to achieve balanced age and requirement of the Bank”.

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The learned counsel for the respondent bank has raised an objection stating that the petitioner is estopped from challenging the impugned order. It is seen that after the petitioner's request for voluntary retirement was rejected by the order dated 10.03.2001, the petitioner submitted another application under Regulation 29 of the Pension Regulations, 1995. This application was favourably considered by the respondent and the petitioner was voluntarily retired from service under the provision of the Pension Regulation, by order dated 10.07.2001. The petitioner appears to have received all the benefits, which he is entitled to under the terms of the Pension Regulation. Thereafter, the petitioner during October 2001, has filed the instant writ petition, challenging the earlier order of rejection. Therefore, on facts, it is clear case of estoppel where the petitioner acquiesced himself of the position, accepted the order of rejection under VRS 2000, thereafter, applied as per the pension regulation and after the same was favourably considered, cannot be permitted to turn around and question the earlier order of rejection under VRS 2000. Therefore, on facts, the petitioner cannot maintain this writ petition and he is estopped from questioning the order of rejection.

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For all the above reasons, there are no merits in this writ petition, accordingly the same is dismissed. No costs.

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Sd/
Asst.Registrar
/true copy/
Sub Asst.Registrar
pbn
To
The Secretary,
Ministry of Banking,
New Delhi.
+1cc to Mr.G.R.Lakshmanan, Advocate Sr 49583
+1cc to Mr.S.Kothandaraman, Advocate Sr 49007
VSN(CO)
km/22.8.
W.P. No. 21134 of 2001

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https://hcservices.ecourts.gov.in/hcservices/

K. Srinivasan v. the Chairman & Managing

Case brief

What is this about?

What the court decided

K. Srinivasan v. the Chairman & Managing

Case brief

What is this about?

What the court decided

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