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1989 DIGILAW 636 (ALL)

Harish Chandra Sahai v. Life Insurance Corporation of India

1989-08-08

S.H.A.RAZA, U.C.SRIVASTAVA

body1989
JUDGMENT U. C. Srivastava and S. H. A. Raza, JJ. - The petitioner who at the relevant time was Development Officer at Lucknow, Life Insurance Corporation of India being transferred employee of the Corporation initially filed this writ petition against the show cause notice, dated 19/25-9-1980 issued prior to the order by which his services were terminated. During the pendency of the writ petition the Zonal Manager as appointing authority terminated the services of the petitioner who did not show cause where after writ petition was amended and prayer for quashing of the termination order, dated 16-6-1981 terminating his services with effect from 16-9-1981 in terms of the provisions of Life Insurance Corporation of India (Staff) Regulations, 1960 (hereinafter referred to as the Regulations). 2. The petitioner was an employee or Ruby General Insurance Company and after coming in force of the Life Insurance Corporation of India Act, 1960 (hereinafter referred to as the Act) by which Insurance Companies were taken over by the Corporation, the petitioner who was at that time Superintendent to the Insurance Company became transferred employee of Corporation as Field Officer in the service of Corporation on who was subsequently designated as Development Officer. Under Section 11 of the Act the employees of the Insurance Company so taken over became employee of the Corporation the same terms and conditions, rights and privileges to which they were entitled to or were enjoying before their transfer until employees is terminated or remuneration, term and condition of service are duly altered of (sic) Corporation. The Central Government has been empowered under sub-section (2) to alter the remuneration and other terms and conditions of service. Under Section 49 of the Act the Corporation with the previous permission of the Central Government by notification in the Gazette has been empowered to make regulation in respect of various matters including the terms and conditions of service of persons who have became employees of the Corporation under Section 11(1) of the Act that the erstwhile employee of the Insurance whose service stood transferred to Corporation. It is in exercise of these powers the Corporation framed L. I. C. (Staff) Regulation, 1960 which were amended from time to time. 3. It is in exercise of these powers the Corporation framed L. I. C. (Staff) Regulation, 1960 which were amended from time to time. 3. In exercise of the powers under Section 11(2) of the Act the Corporation issued Life Insurance Corporation Field Officers (Alternation of Remuneration and other Terms and Conditions of Service) Order, 1957 in supersession of which another Order was issued in 1976 which was replaced by Order of 19 8. The question of conflict and primacy between the 'Order' and 'Regulation' so framed under Section 49 of the Act came up for consideration in the case Life Insurance Corporation of India v. Sunil Kumar Mukherjee and others, AIR 1964 SC 847 . It was held that the provisions contained in Section 11(2) are paramount and would override any contrary provision contained in L. 1. C. Field Officers (Alteration of Remuneration and others Terms and Conditions of Service) Order 1957 or the Regulation. Subject to the proviso of Section 11(2), the provisions of Order will prevail as the Order has been issued by the Central Government by virtue of the powers conferred on it by Section 11(2) itself. The provisions of the Order in law partake the character of the rules framed under Section 48 of the Act. Thus, next to the provision of Section 11(2) of the Act will stand the provisions of the Order. Thus, we have the Regulation issued by the Corporation under Section 49( 1; of the Act. But it must be borne in mind that the power of the Corporation to make Regulation is bonded with the condition that these Regulations must not be inconsistent with the Act and Rules framed thereunder so that if any of the provisions contained in the Regulations made by the Corporation under Section 49 are found to be inconsistent with Section 11(2) or with the Order made by the Central Government under Section 11(2), they would be invalid. 4. In this view the provisions of the Order would ^prevail over that of Regulations. 5. The petitioner was promoted to the post of Assistant Branch Manager and was posted at Kannauj in 1973, but was again reverted buck to me post of Development Officer in 1974 and was posted at Lucknow again. 4. In this view the provisions of the Order would ^prevail over that of Regulations. 5. The petitioner was promoted to the post of Assistant Branch Manager and was posted at Kannauj in 1973, but was again reverted buck to me post of Development Officer in 1974 and was posted at Lucknow again. The petitioner submitted an application, dated 12-7-1974, to the Divisional Manager and requested that his Organisations (the agencies left by him in 1973), the facility of consequence and telephone facilities all enjoyed by him as Development Officer be restored to enable him to function effectively. The petitioner was informed vide letter, dated 17-9-1974 that he would not get the telephone facilities, but no reply to other claims made by petitioner was given. The petitioner continued to send several reminders upto 1979 but without result. 6. Vide notification, dated 19-12-1978 the Government of India introduced new Scheme of service for all the Development Officers of the Corporation. Thereafter vide letter, dated 16-5-1980 the Divisional Manager asked the-petitioner to give details of his performance. From the counter affidavit and papers annexed with it, apparently the petitioner's performance was below the norms. According to the petitioner he pointed out in reply to the Divisional Manager the handicaps referred to above because of which it was below the prescribed limit. Thereafter the show-cause notice in question was issued to the petitioner on 19-9-1980 which has been challenged in this writ petition. Despite challenges, his services were terminated thereafter in pursuance thereof in terms of Clause 6(1) of Schedule III of L. I. C. Staff Regulation as amended through the notification, dated 19-12-1978. 7. Schedule 111 of the Staff Regulation, I960 was deleted in 1971, vide notification, dated 4-8-1971. New Schedule 111 to the Regulation was inserted vide Life Insurance Corporation of India (Staff) Amendment Regulation, 1976. In supersession of previous Order the Central Government on 19-12-1978 issued Life Insurance Corporation (Alteration of Remuneration and Other Terms and Conditions of Service) Order, 1976. Amendments were simultaneously made in the Regulations including in Schedule HI. In the Order 1976, Clause 6 of amended Schedule 6 like that of Clause 6 of the Order, referred to above, provides for termination of service in certain cases and appeal against it and the same reads as under : "6. Termination of service in certain cases. Amendments were simultaneously made in the Regulations including in Schedule HI. In the Order 1976, Clause 6 of amended Schedule 6 like that of Clause 6 of the Order, referred to above, provides for termination of service in certain cases and appeal against it and the same reads as under : "6. Termination of service in certain cases. - (1) The Zonal Manager may terminate the service of a Development Officer on giving him three months notice or salary thereof if his annual remuneration in any preceding year is in excess of the expense limit and if no further opportunity can be given to him to conform to the expense limit in accordance with the foregoing provisions : "Provided that Development Officer concerned shall be given an opportunity to show cause against the proposed termination of his service." "(2) .. ,........ "(3) ................" 8. Under the regulation, services of a Development Officer can be terminated by giving three months notice or salary in lieu thereof in case his annual remuneration in the preceding year is in excess of expense limit. But this is also subject to the condition that no further opportunity can be given to him accordance with the other provisions of Schedule III. The condition precedent for taking this drastic action on such a ground without taking any disciplinary proceedings is formation of opinion on the basis of relevant material that it was no larger possible or desirable to give any further opportunity for improve mention as to conform expense limit, which thus postulates giving of at least one opportunity for the same earlier. Prior to the issuance of show cause notice only one letter was issued to the petitioner and he was given 15 days time to point out any inaccuracies in the figures and was reminded of Clause 6t I) or Schedule III providing for termination of Service. He was told that if within the period granted, the reply does not alter the figures further action will be taken in accordance with the aforesaid Schedule III to the (Staff) Regulations. At no point of time the petitioner was asked to compare his performance or given time to do it. No reference to the petitioner's grievance made repeatedly for restoration of organisation and conveyance available to him earlier for performance of his duties was made. At no point of time the petitioner was asked to compare his performance or given time to do it. No reference to the petitioner's grievance made repeatedly for restoration of organisation and conveyance available to him earlier for performance of his duties was made. In the absence of any consideration of the petitioner's grievance, which either could have been accepted or rejected or even without calling upon him to improve the performance within time and forming opinion that giving of any further opportunity will be futile and that the petitioner was beyond redemption the termination of the petitioner's service under clause 6(c) of Schedule III to the Regulations was in violation of the same and the show cause notice not being a substitute at the same time of this vital requirement. The termination order in the circumstances is manifestly illegal and cannot be sustained. 9. Even otherwise, under Schedule III the services could have been terminated only by giving three months' notice or salary in lieu thereof. There is no denial of the fact that three months' salary was not offered to the petitioner. The notice so given has been challenged on the ground that it was not a three months' notice. The notice was signed on 16-6-1981 and his services were to stand terminated on 16-9-1981. The opposite party has scrupulously avoided saying as to when the same was issued and the petitioner's assertion that it was served on 10-7-1981 has not been denied. From the date of service it was not a three months' notice and from the date of issuance, which is not know, it could be a three months' notice. The case relied upon by Sri Umesh Chandra, learned counsel for the opposite parties, who defended the order vehmenthly viz. State of Punjab v. Khemi Kamt 1969 (3) SCC 98 is distinguishable. In Khemi Ram's case (supra) it was held distinguishing certain cases that once an order is issued and it is sent to concerned Government, it must be hold to have been communicated to him no matter when he actually received it. In the instant case, it has not been stated that the order was issued on the date it was passed. In the notice as it is. the date of signature and the termination is the date on which three months' expired from that date. 10. In the instant case, it has not been stated that the order was issued on the date it was passed. In the notice as it is. the date of signature and the termination is the date on which three months' expired from that date. 10. Schedule III has not laid down any guideline regarding issuance and service of notice. But in the Staff Regulation, 1960 specific provisions exit. Clause 3 of the said Regulation deals with termination of permanent employee either by the employer of the employee himself and it provides for three months' notice but the period would be double if the employee has served for ten years or more. If the same clause could be applied to the petitioner's case, then it would not be a notice in accordance with law. But as the case has not been canvassed on these lines, it is not necessary to consider the same. Explanation I to the said Regulation reads as under : "There expression 'month' used in the regulation shall be reckoned according to the English Calendar and shall commence from the date on which notice is received by the Corporation or the employee as the case may be." 11. In view of the said explanation, the month for the purpose of computing three months' notice will commence only on the date the notice is received by the employee. The said definition in any way is the safest guideline for the purpose and there is no reason to give any other interpretation to the meaning of 'month' in Schedule III to the said Regulation. The notice on this ground itself, not being in conformity with the requirement of specific provision of Clause 6 of the Schedule, is invalid. Any Rule which determent to the interest of tho party which is not equal to the party in any position to enforce the Rule against the other party, the same is to be done as provided otherwise it will be taken as if the same has not been done at all Rule 6(i) is special power conferred as against the general provision which provide for full-fledged enquiry and opportunity to the delinquent employee, and, as such, the same is to be construed, interpreted and approved strictly. The notice in question not being a three mouths' notice in lieu of which even three months' salary was not offered being illegal, the termination order is invalid and cannot be sustained. 12. In view of title fact that the writ petition is being allowed on these grounds, it is not necessary to enter into any other question raised in the petition including the validity of the said Clause (i) of Schedule 111 to the Regulation as amended in 1976. 13. The writ petition is accordingly allowed with costs and the termination order, dated 16-6-1981 and show cause notice, dated 19/25-9-1980 are hereby quashed and the petitioner will be deemed to be continuing in service and will be entitled to all the consequential benefits. 14. There will be no order as to costs.