Allowed

Surajdeo Prasad v. the Bihar State Financial Corp

Patna HC29 Aug 2011CWJC/11625/2011

Case brief

AI extract

What is this about?

Employees of Bihar State Financial Corporation approached the court claiming salary for periods forcedly retired after the statutory age of 58, alleging illegal non-implementation of a board resolution enhancing superannuation age to 60. The court held the corporation liable and directed payment of salary.

What did the court decide?

Directed to pay salary for the period petitioners were kept out of service before attaining 60 years of age.

Surajdeo Prasad Vs the Bihar State Financial… — Pension and Retirement Benefits | Patna HC (2011)

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IN THE HIGH COURT OF JUDICATURE AT PATNA CWJC No.1324 of 2011 Yogeshwar Prasad Singh son of Late Rajendra Singh, permanent resident of village Bahasi P.S. Mahua, Vaishali at Hajipur, at present posted as Deputy Manager, Bihar State Financial Corporation, Branch, Hazaribagh, P.S. Town, Hazaribagh (Jharkhand)

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…Petitioner

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Versus

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The Bihar State Financial Corporation through its Board of Directors, Frazer Road, Patna

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The Managing Director, Bihar State Financial Corporation, Frazer Road, Patna …Respondents . With CWJC No.6297 of 2011 Krishna Ram son of Late Deo Lal Ram, resident of K.D.N. path Gosai Tola, P.O. & P.S. Patliputra, Patna

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…Petitioner

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Versus

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The State Of Bihar through Principal Secretary, Industries 2. The Principal Secretary, Industries, Govt. of Bihar, Patna 3. The Board of Directors of Bihar State Financial Corporation Frazer Road, Patna through its Chairman.

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The Bihar State Financial Corporation Frazer Road, Patna through its Managing Director

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Managing Director, Bihar State Financial Corporation Frazer Road, Patna …Respondents

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With

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CWJC No.11625 of 2011

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Surajdeo Prasad son of Late Gurucharan Ram, resident of Village Kurchi Balavpur, Police Station Digha, Patna

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…Petitioner

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Versus

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The Bihar State Financial Corporation through its Board of Directors Frazer Road, Patna 2. The Managing Director Bihar State Financial Corporation, Frazer Road, Patna

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…Respondents

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With

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CWJC No.11746 of 2011 Bishwanath Roy son of late Gopal Chandra Ray, resident of Mohalla Gulabbagh market, P.S. Gandhi Maindan, Patna.

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…Petitioner

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Versus

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The Bihar State Financial Corporation through its Board of Directors, Frazer Road, Patna

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The Managing Director, Bihar State Financial Corporation Frazer Road, Patna Respondents ----------For the petitioner(s) :Mr. Manik Vedsen & :Mr. Ravindra Nath Dubey, :Mr. Subhash Chandra Bose For the Respondents :Mr. K. D. Chatterjee, Sr. Adv. :Mr. V.K.Tripathy. For the State :Mr.Nagendra Sharma, AC to GP 8

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29.08.2011 These batches of writ petitions raise the common issue(s) and, as such, they have been clubbed together and are listed for consideration.

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Heard learned counsel for the petitioners and learned

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counsel for the Respondent-Corporation and its officials.

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A composite counter affidavit has been filed in CWJC No. 1324 of 2011. Learned counsel for the respondents has taken a stand that he would refer to the averments made therein in order to support his contention in the present batch of writ petitions. The Court will, therefore, refer to the said counter affidavit as and when necessary.

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Facts giving rise to the present batch of writ petitions shall be drawn from CWJC No. 6297 of 2011 (Krishna Ram vs. State of Bihar & Ors.) Petitioners herein were serving the Bihar State Financial Corporation (for short „the Corporation‟). The State Government by a resolution dated 24.03.2005 (Annexure-3) enhanced the age of superannuation of its employees from 58 years to 60 years with effect from the said order. The Respondent-Corporation by a resolution dated 25.08.2006 (Annexure-4) also resolved to amend its regulation, particularly regulation 19(1) in order to give the said benefit to the employees of the Respondent-Corporation. In spite of the aforesaid resolution having been made by the Board of Directors, respondents were not giving effect to the said resolution. The Corporation Employees Federation filed a writ

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petition in the representative capacity being W.P. (S) No. 5777/06 before the Jharkhand High Court seeking a direction upon the respondents to implement the aforesaid decision of the Respondent-Corporation. The said writ petition was dismissed by an order dated 12.02.2007 as contained in Annexure-R/1 of the counter affidavit. Aggrieved thereby, the writ petitioner(s) filed appeal in the said Hon‟ble Court being LPA No.83 of 2007. During the pendency of the said appeal, the RespondentCorporation continued to superannuate its employees who had attained 58 years of age. An application, therefore, was filed in the pending appeal which was considered and disposed of by order dated 27.01.2009.

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During the pendency of the aforesaid writ petition, the State Government by a communication dated 12.01.2007 refused to grant permission to the Corporation for enhancement of age of superannuation of its employees on the ground of accumulated loss sustained by the Corporation.

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By order dated 27.01.2009 (Annexure-R/2), the LPA Court clarified that any superannuation made in the meanwhile shall be subject to the result of the proceeding/appeal. On hearing the parties at length, aforesaid appeal was allowed by judgment/order dated 22.04.2009 (Annexure-R/3). The operative portion of the order reads as under:

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“Admittedly, not only the employees of different Corporations and local bodies of the State of Bihar, but also the Corporations and other local bodies of the State of Jharkhand have increased the age of

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superannuation of their employees from 58 years to 60 years. Although, the stand of the State Government is that because of financial position of the Corporation, sanction for increase of age of superannuation has not been given, but no materials have been brought on record to show that the financial position of the Corporation is not good. On the contrary, taking into consideration the financial position of the Corporation, the Board of Directors, which is the competent authority has taken a resolution for enhancement of the age of superannuation of the employees from 58 years to 60 years. In the aforesaid premises, in our considered opinion, the decision of the Government of Bihar of not according sanction for the enhancement of age of superannuation of the employees of the corporation is not justified and cannot be sustained in law. The learned Single Judge has not considered this aspect of the matter.

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We, therefore, allow this appeal and set aside the impugned judgment passed by the learned Single Judge and direct the respondents-State of Bihar to accord sanction for the enhancement of age of the employees of the Corporation within a period of 30 days from the date of receipt of a copy of this orders.”

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The appellant of LPA No.83/07 thereafter filed a civil review application being Civil Review No.56 of 2009 seeking certain clarifications in the order passed on the said appeal. The said civil review application was disposed of on 20.05.2009 (Annexure-8 of CWJC No. 1324 of 2009). The Court clarified the appellate order in the following manner:

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“Hence, in the light of the order dated 22nd April, 2009, we observe that the sanction for enhancement of age of the employees of the corporation from 58 years to 60 years shall be made applicable to the employees, who attained the age of superannuation.”

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Aggrieved by the aforesaid order, the RespondentCorporation filed special leave petition before the Hon‟ble

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Supreme Court which was considered and rejected at its threshold by order dated 01.10.2009. The employees of the Respondent-Corporation who, during the pendency of the aforesaid proceeding, were made to retire filed a contempt petition before the Hon‟ble Jharkhand High Court vide MJC No. 754/2009. The opposite parties (respondents herein) sought time to file their respective show cause(s). The Hon‟ble Court hearing the contempt matter by a proceeding dated 16.12.2009, while granting adjournment to enable the opposite parties to file their respective show cause(s), directed not to retire any employees until they attain the age of 60 years. During the pendency of the said contempt proceeding the RespondentCorporation came out with notification dated 17.02.2010 whereby the decision/resolution to enhance the age of superannuation of its employees from 58 years to 60 years was made operative with effect from 16.12.2009 (the date on which the Hon‟ble Court hearing the contempt petition passed the interim order). The petitioner of CWJC No. 6297 of 2011, in the meanwhile filed a writ petition (CWJC No. 5391/10) in this Court seeking a direction upon the respondents to reinstate him back into service and to pay arrears of salary since the Respondent-Corporation, in the meanwhile, had made him to superannuate on attaining 58 years of age. The petitioners of other writ petitions were also made to retire on attaining the age of 58 years. They however, did not approach this Court. During the pendency of the said application as also the contempt

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application (MJC No.754/09 before the Jharkhand High Court), the Respondent-Corporation amended its earlier order/resolution by another resolution/order dated 30.03.2010 (Annexure-10) by which the decision to enhance the age of superannuation was shifted and made effective from 12.02.2007(the date on which

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the writ petition being W.P.(S) No. 5777 of 2006 was dismissed). In the light of the said stand taken by the Respondent-Corporation, the petitioner got his case withdrawn by order dated 12.04.2010 (Annexure-9 to CWJC No. 6297 of 2011). The aforesaid resolution/order/decision of the Respondent-Corporation to implement the decision to enhance the age of superannuation of its employees with effect from 12.02.2007 was subsequently approved by the government with effect from 25.08.2006, i.e. the date on which the Board of Directors of the Respondent-Corporation (respondent no.3) resolved to amend the regulation no. 19(1) to enhance the age of its employees from 58 years to 60 years. Accordingly, the Respondent-Corporation came out with an order dated 19.04.2010 (Annexure-11), whereby the earlier Standing Order was modified whereby enhancement of age of superannuation of its employees was made effective from 25.08.2006. Petitioner by order dated 28.04.2010 (Annexure-13) was allowed to rejoin the service and subsequently he was allowed to superannuate on attaining 60 years of age. Similar is the case with regard to other writ petitioners.

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The grievance(s) of the petitioners in all the present

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batch of writ petitions is/are that they have not been paid salary for the period the were not allowed to discharge their duties by the authorities of the Respondent-Corporation. In other words, they have approached this court for payment of their salary for the period they were made to superannuate on attaining 58 years of age and their respective date(s) on which they were reinducted/reinstated in service after the resolution of Board and/or the orders passed by the Court in pending proceeding(s).

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The respondents have resisted the claim of the petitioners precisely on two counts as would appear from perusal of the counter affidavit filed on behalf of the Respondent-Corporation and its officials. Learned counsel for the Respondent-Corporation states with reference to the averments made therein that applying the principle of „no work no pay‟, the petitioners are not entitled to get salary for the period they have not discharged their duties. It is not contended that status/position of the Corporation is fairly strained and if the Corporation is compelled to make payment to the petitioners who were made to retire on attaining the age of 58 years, it would create an extra financial burden on the Corporation and would adversely affect its viability due to its poor financial condition.

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Learned counsel for the petitioners, on the other hand, submits that the said stand taken by the respondents in counter affidavit is wholly unsustainable in law. Learned counsel points out that the stand taken therein is contrary to

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the decision taken on 30.03.2010 (Annexure-10). It is also contended that while allowing the appeal (LPA No.83/07) the said issue was raised and considered by the appellate Court. There is already a finding recorded in the said order passed on LPA No.83/07 that the Respondent-Corporation is running in profit. The appeal Court, while allowing the appeal, has taken into consideration the fact that on being satisfied about its financial position, the Respondent-Corporation had taken a conscious decision to enhance the age of superannuation of its employees. It is thus contended that facts of the case would eloquently indicate that the respondents in spite of interim order passed in LPA as well as the final order passed therein could have allowed the petitioners to continue but they designedly made them to retire without there being any justification therefor. Learned counsel for the petitioners, with reference to the balance sheet of the Corporation, has asserted that for the financial year 2004-05, 2005-06 and 2006-07, the Corporation has been earning a huge profit and paying heavy tax. It is thus contended that the stand with regard to the precarious financial position is being taken only to negate the lawful claim of the petitioners. In this connection, learned counsel for the petitioner highlights that after consideration of the matter by LPA Court interim order was passed whereafter there was absolutely no justification on the part of the RespondentCorporation to direct the petitioners to superannuate on attaining 58 years of age.

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Having heard the parties and on going through materials on record, it appears that there is adequate materials on record to indicate that Respondent-Corporation was required to implement the order passed in LPA No.83/07, as clarified by order dated 20.05.2009 passed in Civil Review No.56/09. Instead of implementing the order, the Respondent-Corporation preferred SLP before the Hon‟ble Supreme Court which was ultimately dismissed in limine by order dated 01.10.09. At that stage, the Corporation could have permitted the petitioners to continue in the service but the same was not done. Ultimately, the appellant of LPA No.83/07 had to file a contempt proceeding wherein a stand was taken by the respondent(s) that the Corporation would implement the order with effect from 12.02.2007(the date on which the writ petition was dismissed by the writ Court of Jharkhand High Court). In these fact situation if the stand of the Respondent-Corporation that the petitioner are not entitled to get their salary for the period they were kept out of service is accepted, then this may tantamount to granting premium on their disregard to the order of the Court. Different orders including the interim order passed in LPA No. 83/07 as also in MJC No.754 of 009 would be meaningless for the petitioners who were to be benefited by those orders. The stand of the Respondent-Corporation to deny them the benefit of different orders passed by the Court on the ground that the Corporation is presently under financial crunch, in my view, is also not tenable. It appears from materials on record including

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the order passed in LPA No. 83/07 and the resolution of the Board of Directors dated 25.8.2006 whereby a decision was taken to enhance the age of superannuation of its employee keeping in view the financial position of the Respondent-

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Corporation that no such disability was found. This Court would, therefore, hold that the present batch of writ petitions are fit to be allowed in the following manner:

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The Respondent-Corporation and its officials are directed to pay the salary to the petitioners for the period(s) they were kept out of job before attaining 60 years of age. The Respondent-Corporation shall calculate the amount of salary payable to each of the petitioner and authorize payment thereof in their favour within a period of eight weeks from the date of receipt/production of a copy of this order.

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( Kishore K. Mandal )

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Surajdeo Prasad v. the Bihar State Financial Corp

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Surajdeo Prasad v. the Bihar State Financial Corp

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