Judgment : The Judgment of the court was delivered by Mrs.Prabha Sridevan, J. 1. Thewrit petition is the appellant. 2. The closure of a Government of Tamil Nadu Enterprise resulted in employees being rendered jobless. One such employee filed the above petition. 3. The petitioner had been working as an accountant in the second respondent undertaking from 17. 1978. When the TACEL, the second respondent had to be closed down on account of continuous losses and unviable functioning, it terminated the services of the petitioner with effect from 31. 1989. Considering the hardship that visited the families of all the employees like the petitioner upon such termination, the Government of Tamil Nadu Industries Department suggested on humanitarian grounds that employment should be offered to the ex employees of TACEL, by Corporation and Boards under the Control of Government of Tamil Nadu. Accordingly, the third respondent which is also a Tamil Nadu Government Undertaking and which had a vacancy in the post of Accountant, offered the same to the petitioner, who accepted it and joined the services of the third respondent on 12. 1990. 4. Thereafter he filed the present writ petition sometime in February, 1993 for a mandamus that the second respondent should grant Selection Grade to him, his existing scale of pay should be revised as per the recommendations of the Fifth Pay Commission, the two months pay that he was entitled to when his services were terminated by the second respondent should be paid and finally should be given fitment in the third respondent commensurate with the pay that he would be entitled to if he had moved to Selection Grade and if the Fifth Pay Commission recommendations had been implemented. 5. The writ petition was dismissed on the ground that the movement to the Selection Grade was not automatic; that the decision not to implement the Fifth Pay Commissions recommendations was a policy decision which cannot be interfered with; his claim for three months pay, pursuant to the notice was not maintainable; since he had been relieved from services on his own request and not terminated and finally since he was recruited by the third respondent only as a fresh recruit, the question of fitment did not arise. 6. Aggrieved by this, the present writ appeal has been filed. 6. Aggrieved by this, the present writ appeal has been filed. The learned counsel for the appellant Ms.R.Vaigai submitted that the petitioner was entitled to all the four reliefs that had been claimed and if the Government takes into account the overall Superintendence of all the public undertakings, it owes a duty to its employees of fair treatment, especially in a welfare State like ours and that considering the fluctuations in the economic scenerio, all the protection that an employee is entitled to as also the welfare measures shall not be denied to him. 7. With regard to the movement to Selection Grade, the learned counsel for the appellant submitted that admittedly the appellant had entered into service on 15. 1978. Therefore, he automatically moved to Selection Grade after a lapse of ten years i.e. on 15. 1988. This was not given to him inspite of repeated representation like the letter dated 20.11.1991 filed in the paper book. The learned counsel but the appellant also referred to the case of one K.Purushothaman, which is filed in the paper book and which refers to the proceedings in respect of the said employee, where the said employee is moved to Selection Grade on the completion of ten years of continuous regular service. A reading of the order would show that only availment of leave with loss of pay and not past performance would postpone the movement the Selection Grade. Learned council for the appellant submitted that there was no reason as to why the appellant should be treated differently and not moved to Selection Grade, when he had completed ten years of regular service. 8. Next, the learned counsel submitted that the Fifth Pay Commission, whose recommendation was accepted with effect from 6. 1988 hard to have been implemented in the second respondent undertaking and the appellants scale of refixed accordingly. Learned council referred to a decision of the learned single judge of this Court in Writ Petition No.10122 of 1992, where the Tamil Nadu Sugarcane Workers had claimed the benefits as per the Fifth Pay Commission and had received favourable orders from this Court. Learned counsel referred to various interim orders passed by the Supreme Court with reference to the employees of Hindustan Fertiliser Corporation Ltd., and Food Corporation of India, where the Supreme Court had directed the interim payment to be made as on ad hoc measures. Learned counsel referred to various interim orders passed by the Supreme Court with reference to the employees of Hindustan Fertiliser Corporation Ltd., and Food Corporation of India, where the Supreme Court had directed the interim payment to be made as on ad hoc measures. Therefore, the learned counsel for the appellant submitted that there was no justification for the second respondent not to implement the recommendation of the Fifth Pay Commission to its employees. 9. Thenext grievance of the appellant is the non-payment of the terminal benefits in time and also the non-payment of salary for two months as per the service rules of the second respondent evidenced by the notice of termination dated 212. 1988 issued by the Chairman and Managing Director of the second respondent. As regards the terminal benefits, which is calculated and settled in the order dated 21. 1991, the second respondent after calculating the amount due to the appellant, has arrived at the conclusion that no amount is payable to the appellant, since some recoveries have to be made from him and since an amount of Rs.33,719 had been ordered to be attached by the Sub Judge, Vridhachalam. According to the learned counsel for the appellant even after the attachment order was vacated, the respondent did not pay the gratuity and other benefits. The learned counsel for the appellants submitted that the second respondent wanted the employee to execute an indemnity bond for payment of terminal benefits which would prejudice his legal rights too and therefore, instead of the indemnity bond he had given a letter stating that he is agreeable to receive it in full payment and inspite of that the second respondent did not settle the terminal benefits in time. It is submitted by the both the councils that pending Writ Appeal in the year 1999 the amount had been paid and received. 10. It is submitted by the both the councils that pending Writ Appeal in the year 1999 the amount had been paid and received. 10. The learned counsel for the appellant also referred to the provisions of the Payment of Gratuity Act, 1972 which provides for payment of simple interest by the employer if the amount of Gratuity is not paid within the stipulated period provided that such delay in payment is not due to fault of the employee and the employer has obtained permission in writing from the Controlling Authority (Sec.73(a) of the Act), and it also provides for recovery of the amounts due as though there were arrears of land revenue in case the amount of gratuity is not paid by the employer within the prescribed time and the employee makes an application to the Controlling Authority (Sec.8 of the Act) and also do the relevant rules viz., the Tamil Nadu Payment of Gratuity Rules. Therefore, according to the learned counsel for the appellant the subsequent payment in 1999 did not absolve the employee of its default and the appellant was entitled to interest for the period during which the gratuity which was not paid. The learned counsel for the appellant relied on the decisions reported in O.P.Gupta v. Union of India and others O.P.Gupta v. Union of India and others O.P.Gupta v. Union of India and others, 1987 S.C.C. 328 and Harendranath v. State of Bihar and others, 1987 S.C.C. (Supp.) 56 to support her contention that interest should be paid when payments due to the employee are made belatedly. 11. Finally, the learned counsel argued the question of appropriate fitment of the appellant, in the third respondent undertaking. According to the learned counsel, the appellant ought not to have been taken in by the third respondent as a fresh entrant. His post and pay scale in the second respondent undertaking should be kept in mind and it should have been protected while he was fitted in the service of the third respondent. While considering the question of appropriate fitment the third respondent undertaking, the appellant ought to have been given the benefit of his movement to Selection Grade and the revised scales of pay as per the Fifth Pay Commission recommendation. While considering the question of appropriate fitment the third respondent undertaking, the appellant ought to have been given the benefit of his movement to Selection Grade and the revised scales of pay as per the Fifth Pay Commission recommendation. Since the appellant was legally entitled to be moved the Selection Grade as per the service rules of the second respondent, the seniority that he had attained in the second respondent cannot be denied to him when he entered in the third respondent undertaking. Similarly, the scales of pay that he would be entitled to both upon movement to Selection Grade and on the implementation of the Fifth Pay Commission recommendations should also be protected so that this advantage also cannot be denied to appellant. To support her contention the learned counsel for the appellant relied on two decisions of the Supreme Court reported in State of Punjab and others v. Gursharan and others State of Punjab and others v. Gursharan and others State of Punjab and others v. Gursharan and others, (1997)2 S.C.C. 259 and Gurmail Singh and others v. State of Punjab and others , (1991) 1 S.C.C. 189 . Therefore, according to the learned counsel for the appellant since he was not granted appropriate fitment, it violated his fundamental right. Therefore, the relief should also be granted to him. To sum up, according to the learned counsel for the appellant, all the heads of claims on which the appellant had approached this Court under Art.226 of the Constitution of India should be granted to him and the learned single Judge had erred in dismissing the writ petition. 12. In reply Mr.N.C.Ramesh, learned counsel for the second respondent submitted that the question of movement to Selection Grade is not automatic and since the appellants performance had not been satisfactory, it was decided not to move him to Selection Grade. As regards the question of implementation of recommendation of Fifth Pay Commission, the learned counsel submitted that this was a policy decision taken by the second respondent since the closure itself was due to economic losses sustained by the Corporation as well as unviable financial condition. Therefore, the question of implementation of Fifth Pay Commission Recommendation was decided against and in fact to a representation made by the appellant herein to the Industries Department a letter had been issued by the Deputy Secretary to Government Industrial Department on 26. Therefore, the question of implementation of Fifth Pay Commission Recommendation was decided against and in fact to a representation made by the appellant herein to the Industries Department a letter had been issued by the Deputy Secretary to Government Industrial Department on 26. 1992 that the second respondent had decided not implement the Fifth Pay Commission recommendation to the employees since it has been incurring heavy losses. He also brought to the notice of this Court a decision given in W.P.No.17009 of 1990 by learned single judge in a petition filed praying for a writ of mandamus for payment of arrears of salary as per the Fifth Pay commission report against this very respondent. The learned judge by his order dated 210. 1998 had held that when the decision had been taken not to implement the recommendations of the Fifth Pay Commission report is so far as the employees of the second responded herein our concerned, this Court cannot issue any direction for implementation of the same. 13. As regards the non-payment of the terminal benefits and the two months salary pursuant to the termination, the learned counsel submitted that the appellants service had been terminated with effect from 31. 1989 by order dated 212. 1988 and this order had been challenged by him by way of a Writ Petition No. 1869 of 1989 and he had also obtained interim stay. Subsequently, when vacancy arose in the third respondent and appellant was willing to join the services of the third respondent as an Accountant, he withdrew his writ petition and sought to be relieved of his duties and he was relieved of his duties on 12. 1990. Therefore, the payment of two months salary was out of the question, since the appellant had challenged the notice by way of writ petition and also withdrawn the writ petition subsequently. 14. As regards the delay in payment of gratuity, the council for the second respondent submitted that this amount was withheld for him by virtue of an attachment order passed by the Sub Judge, Vridhachalam and it was after the attachment order was vacated, the terminal benefits would be settled. In the meantime, the appellant had made a representation by his letter dated 6. 1994 that the amount due either paid to him or to Indian Overseas Bank, since there was a liability due by him to Indian Overseas Bank. In the meantime, the appellant had made a representation by his letter dated 6. 1994 that the amount due either paid to him or to Indian Overseas Bank, since there was a liability due by him to Indian Overseas Bank. But such payment could not be made by the second respondent unless an undertaking was given by him in a prescribed a format. But the said undertaking was not given by the appellant in the prescribed format and that is why there was a delay in settling the terminal benefits and for the delay initially there was a court order which restrained the respondent from paying the same and subsequently, the delay arose on account of the appellants non compliance of giving undertaking in the prescribed the format. For these reasons, the learned counsel for the second respondent said that the terminal benefits would not be paid within the prescribed a time. 15. the learned counsel Mr.V.Karthik, appearing for the third respondent, against whom the claim of fitment in the appropriate Post is made by the appellant submitted that the appointment of the appellant was a fresh one and there was no question of him being fitted according to the post held by the appellant in the second respondent. The learned counsel submitted that when the second respondent undertaking was closed, many of the employees found themselves without any job. At that time, the Government on a humanitarian ground issued orders that future vacancies arose in Government Departments or Undertakings, the retrenched employees could be posted in such of those vacancies that arose subject to their fulfilling the essential qualifications while at the same time relaxing the age requirements. In the year 1990, a vacancy arose in the third respondent for a post of Accountant. The appellant was offered an employment as an Accountant and he willingly took it up. He entered the services of the third respondent as a fresh employee on 12. 1990. So, the question of appropriate fitment did not arise. The appellant was fitted in the pay scale that obtained for an Accountant at that time. Subsequently when the third respondent decided to implement the Fifth Pay Commission Report and the pay scales of Accountant were revised, the appellant, being an Accountant, considered the representation of the appellant and had revised his pay scale accordingly. The appellant was fitted in the pay scale that obtained for an Accountant at that time. Subsequently when the third respondent decided to implement the Fifth Pay Commission Report and the pay scales of Accountant were revised, the appellant, being an Accountant, considered the representation of the appellant and had revised his pay scale accordingly. According to the council for the third respondent, the appellant has been fitted on a higher pay scale at request and so far as this responded was concerned, he was a fresh entrant and there was no question of him being fitted according to the post held by him earlier. The learned Government Advocate appearing for the first respondent submitted that the appellant completed ten years of service only on 15. 1988 and since the second respondent was closed with effect from 3. 1988 and the appellant not having completed ten years of continuous satisfactory service, the question of considering his movement to Selection Grade did not arise. The learned Government Advocate also submitted that as per guidelines issued by the various departments, it was decided not to implement the Fifth Pay Commission recommendations to the employees of the second respondent, since it was incurring heavy losses right from the beginning. 16. For the above said reasons the councils for the respective respondents submitted that there was no warrant for interference with the order of the learned single Judge. 17. The grievance of the appellant comes under four heads and we will deal with them one by one. 18. With regard to the implementation of a Fifth Pay Commission recommendation, it is seen from the counter filed by the first respondent the Finance Department had issued guidelines for accepting the Fifth Pay Commission recommendation. Accordingly, this corporation which was suffering financial losses from the beginning had taken a policy decision not implement them. The two decisions of this Court passed in W.P.Nos.17009 of 1990 and 10122 of 1992 were produced before this Court. As stated earlier, the former was filed by the employee of the second respondent whose claims in this regard were negatived by the learned single Judge of this Court, who was not inclined to interfere with the decisions taken by the Government in this regard and issue contrary directions. 19. As stated earlier, the former was filed by the employee of the second respondent whose claims in this regard were negatived by the learned single Judge of this Court, who was not inclined to interfere with the decisions taken by the Government in this regard and issue contrary directions. 19. As regards the latter writ petition, it is brought to our notice that it has been challenged by way of writ appeal and writ appeal is pending. The various orders of the Supreme Court produced before us are all interim orders in respect of various units of two major corporations whose employees had sought for revision of pay scales and some of the units had been closed and proceedings were pending before BIFR. In the circumstances, the Supreme Court had passed these interim orders purely as an adhoc measures. These orders do not apply for the facts of this case. 20. A financially sick Corporation which is close down admittedly on account of continued heavy losses right from its inception and which has decided to close down and had in fact closed down and therefore, had resolved not to implement the Fifth Pay Commission recommendation cannot now be saddled with the direction to implement revision of pay scales. 21. As regards the claim for appropriate fitment in the third respondent Corporation Commensurate with post and pay scales held and received by the appellant in the second respondent corporation, it is not in dispute that the appellant joined the third respondent as a fresh entrant. It was not a question of transfer or absorption. Various Corporation and undertakings which came under control of State of Tamil Nadu were directed to give opportunities to the retrenched employees of the second respondent in any vacancy as and when it arose relaxing the age qualification subject to the employee possessing the other qualifications. The vacancy that arose in the third respondent was that of an Accountant and the appellant joined the services of the third respondent as an Accountant. The decision reported in State of Punjab and others v. Gursharan Singh and others , (1997)2 S.C.C. 259 was a case of a Government Engineering College being handed over to an autonomous society together with the existing staff. The decision reported in State of Punjab and others v. Gursharan Singh and others , (1997)2 S.C.C. 259 was a case of a Government Engineering College being handed over to an autonomous society together with the existing staff. When some of the employees wanted to retain their identity as Government employees rather than being transferred to private bodies, the Supreme Court directed the Government to explore the possibility of absorbing such employee in any vacancies available in Government services. In fact in that case, one Assistant Professor who worked in the scale of pay of 3700 - 5700 could only be absorbed as a lecturer in the scale of pay of 2200 - 4000. He was so absorbed since this person had no objection to the same, though it was a lower scale of pay. .22. Inother case reported in Gurmail Singh and others v. State of Punjab and others, (1991)1 S.C.C. 189 , Tube Well Operators were rendered jobless because the tube wells of the Public Works Department was transferred to a Corporation solely owned by the State. The Supreme Court held that while transferring the tube wells, it was not fair to retrenched the operators and when pending the litigation the industrial undertaking offered to take employees as fresh appointees, the Supreme Court declared that this attitude was designed to achieve nothing more than depriving employees of some benefits and it came ill from a State Government. 23. Inthis case, however, there is a total cessation of activity of the second respondent. The Corporation was not transferred to any other undertaking nor were the employees absorbed by some other corporation. But the entire activities ceased. Thereafter, it was only because the Government considered the plight of the retrenched employees, and as a welfare measure and on humanitarian grounds made efforts to accommodate these employees in vacancies as and when they arose in the various Government Corporation and undertakings. Upon the decision to close the undertaking, all the employees are also given their terminal benefits. Therefore, the employment of the appellant in the third respondent is a fresh beginning and hence the claim for appropriate fitment cannot be entertained. 24. The next question is with regard to the non-payment of terminal benefits and the non-payment of two months salary as per the termination notice. The appellant was served with the termination notice dated 212. Therefore, the employment of the appellant in the third respondent is a fresh beginning and hence the claim for appropriate fitment cannot be entertained. 24. The next question is with regard to the non-payment of terminal benefits and the non-payment of two months salary as per the termination notice. The appellant was served with the termination notice dated 212. 1988 terminating his services with effect from 31. 1989. The Service Rules of the second respondent required three months notice to be given but since only one months notice was given, it was stated in the notice that he would be paid salary for the uncovered period of two months. No doubt this termination notice was challenged by the appellant by filing a writ petition before this Court and interim stay had also been obtained by him. Consequently, he continued to receive his salary until the date when he withdrew the writ petition so that he may be relieved of his duty with the second respondent undertaking, to enable him to join the services of the third respondent undertaking. This is why the learned single Judge rejected the appellants claim in this regard on the ground that he was relieved from service on his own request and not pursuant to termination notice. If the submission of the learned counsel for the appellant is accepted, then having received the salary for those two months, because he continued to be in service on account of the interim stay granted by this Court, he will get double payment for the same months if this relief is granted to him. Therefore, the claim for two months salary payable as per the service rules after the service is terminated is rejected. .25. As regards the non-payment of terminal benefits within time and the question of whether the second respondent is liable to pay interest for the period of delayed payment, it is admitted that originally the payment of terminal benefits was withheld because there was an order of attachment against the appellant passed by the Sub Judge, Vridhachalam. This is admitted in the affidavit filed by the appellant in support of the direction petition filed in this writ appeal. The order was dated 21. 1991. The petitioner was relieved of his duties in the afternoon of 12. 1990 in obedience to the order of the High Court, Madras in Writ Petition No.1869 of 1989 dated 12. This is admitted in the affidavit filed by the appellant in support of the direction petition filed in this writ appeal. The order was dated 21. 1991. The petitioner was relieved of his duties in the afternoon of 12. 1990 in obedience to the order of the High Court, Madras in Writ Petition No.1869 of 1989 dated 12. 1990. It is also admitted that the attachment order was vacated on 29. 1992 by the Sub Judge, Vridhachalam. This information was communicated to the second respondent on 26. 1994 requesting for release of the aforesaid amount. This is also not in dispute. But according to the appellant, the second respondent ignored this request. To this averment, a counter has been filed on behalf of the first respondent in this writ appeal that he made representation on 6. 1994 to the effect that since he owed a liability to Indian Overseas Bank. The Indian Overseas Bank had already intimidated to the respondent to withhold the payment of terminal benefits as per the counter of the first respondent. The second respondent therefore required the appellant to give an undertaking in the prescribed format to enable the second respondent to pay the arrears to the bank. But the appellant did not do so. The contention of the respondent is that if the payment is made to the bank and not the individual without obtaining an undertaking in the prescribed format, then the second respondent would not be protected, if there are subsequent claims made in respect of the same amount. The learned counsel for the appellant does not dispute the fact that the appellant did not submit the undertaking in the prescribed format. According to her, the appellant could not do so because of pendency of the proceedings. Be that as it may, there had been an order of court restraining payment till 1994 and thereafter the delay in payment was due to the appellant not giving an undertaking in the required format. Therefore, the second respondent cannot be fixed with the liability to pay the interest for the delay, in setting the terminal benefits. So the claim for interest is negatived. 126. The final question is with regard to the movement to Selection Grade. The rules provide for an employee to be moved into Selection Grade upon completion of ten years of continuous regular service. So the claim for interest is negatived. 126. The final question is with regard to the movement to Selection Grade. The rules provide for an employee to be moved into Selection Grade upon completion of ten years of continuous regular service. It is not in dispute that the appellant was first appointed on 15. 1978. Two reasons are given by the respondents for not moving him to Selection Grade. One is that the movement is not automatic and the appellant was not eligible to be moved to Selection Grade, since his services was not satisfactory. But this reason had never been communicated to him as rightly pointed out by the learned counsel for the appellant. She referred to the decision reported in the O.P.Gupta v. Union of India and others O.P.Gupta v. Union of India and others O.P.Gupta v. Union of India and others, 1987 S.C.C. 328 which was a case that stoppage of increment was ordered with retrospective effect after retirement of a Government person. The Supreme Court held such a person was entitled to hearing before an adverse order was passed. The learned counsel also referred to the decision reported in The Manager, Government Branch v. D.B.Beliappa The Manager, Government Branch v. D.B.Beliappa The Manager, Government Branch v. D.B.Beliappa, (1979)1 S.C.C. 477 to show that even in the case of temporary Government servant, this service cannot be terminated if reasons are not disclosed. Therefore, if the respondents were in possession of materials to show that the appellants conduct was not satisfactory which disentitled him from moving to the Selection Grade, they should have been made known to him and an opportunity ought to have been given to defend himself. The other reason given by the respondent is that the second respondent was closed with effect from 3. 1988 and since the appellant joined the duty only on 15. 1978, he had not completed ten years on the date when the unit was closed and therefore the question of informing him of the decision not to move him to Selection Grade did not arise. This contention cannot be accepted, for this reason, the order of termination of service of the appellant herein clearly states as follows: “The Board TACEL has also resolved to close down this unit with effect from 31. 1989.” Therefore, the unit was closed only on 31. This contention cannot be accepted, for this reason, the order of termination of service of the appellant herein clearly states as follows: “The Board TACEL has also resolved to close down this unit with effect from 31. 1989.” Therefore, the unit was closed only on 31. 1989 and if ten years is calculated from the date of the appellants first appointment he had completed ten years on 15. 1988. the learned counsel for the appellant also produced the proceedings of the Chairman and Managing Director of the second respondent dated 3. 1990 in which another employee of the second respondent who had joined duty on 11. 1978 was moved to Selection Grade on 11. 1988. So it is apparent from the face of the record that the case of the respondent that the unit closed in February, 1988 cannot be correct. The respondents do not dispute the proceedings referred to above that has been filed in the type set of papers. 27. As already stated the services of the appellant had been terminated with effect from 31. 1989 and since the appellant had not been put on notice any materials of regarding his unsatisfactory conduct, and such an allegations by the respondent cannot be countenanced now. The only other factor that might postpone the movement to Selection Grade is the employees of availment of leave with loss of pay as seen from the proceedings dated 13. 1990 referred to above. Since the respondents have not submitted any details regarding this, we will have to take it that there has been no availment of leave with loss of pay by the appellant. The consequence is he ought to have been moved to Selection Grade on 15. 1988, the benefits that accrued to him upon such movement shall be calculated for the period from 15. 1988 till 31. 1989 the date on which his services stood terminated, and paid to him. 28. Inthe result, the writ appeal is partly allowed. The appellant is not entitled to revision of pay scale as per the Fifth Pay Commission, he is not entitled to any revision of fitment in the services of the third respondent. He is not entitled to two months’ salary as per the termination notice dated 212. 1988. He is not entitled to any interest for the delay in payment of terminal benefits. He is not entitled to two months’ salary as per the termination notice dated 212. 1988. He is not entitled to any interest for the delay in payment of terminal benefits. He is to be moved to Selection Grade on 15. 1988 and the consequential relief from 15. 1988 till 31. 1989. No costs. Consequently, the connected C.M.P. is closed.