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Madhya Pradesh High Court · body

2011 DIGILAW 1004 (MP)

Bhagwat Singh Thakur v. State of M. P.

2011-08-26

SANJAY YADAV

body2011
ORDER Sanjay Yadav, J. 1. This order shall govern final disposal of Writ Petition Nos.10213/2010(S), 13483/2010(S), 11824/2010(S), 16253/2010(S),1 3549/ 2010(S), 8800/2010(S), 1645/2010(S), 12305/2010(S), 12322/ 2010(S), 12328/2010(S), 12333/2010(S), 12341/2010(S), 12346/ 2010(S), 12348/2010(S), 12174/2010(S), 14008/2010(S), 13426/ 2010(S), 13550/2010(S), 12640/2010(S), 12314/2010(S), 13144/ 2010(S), 13142/2010(S)15117/2010(S), 11703/2010(S), 12108/ 2010(S), 12642/2010(S), 9554/2010(S), 12725/2010(S), 13935/ 2010(S), 13927/2010(S), 11421/2010(S), 11831/2010 and 11828/2010(S). 2. Number of employees employed in the Madhya Pradesh Road Transport Corporation who completed 20 years of service or 50 years of age were compulsorily retired in public interest. It is these orders which are under challenge in these bunch of writ petition which were analogously heard. 3. Common uncontroverted facts are that, the petitioners are permanent employees of Madhya Pradesh Road Transport Corporation posted at various places in the State of M.P. Their service conditions, besides being governed by the Regulations framed by the Corporation are also subject to the provision contained in Madhya Pradesh, Industrial Relation Act 1961, Chapter VA of the Industrial Disputes Act, 1947 (hereinafter to be referred to as Act of 1947) as these statutes are applicable to the Corporation. 4. The main plank of submission on behalf of these employees is that, in absence of specific Regulation providing the compulsory retirement being one of the mode of premature retirement, their premature retirement in public interest is illegal and without any authority. On merit the submission is that on the basis of nonexisting facts the petitioners are been prematurely retired. 5. Respondent Corporation is a statutory Corporation duly constituted under Section 3 of Road Transport Corporation Act, 1950, which provides for that the State Government having regard to the advantages offered to the public, trade and industry by the development of road transport; the desirability of co-ordinating any form of road transport with any other form of transport; and the desirability of extending and improving the facilities for' road transport in any area and for providing an efficient and economical system of road transport service therein, may, by notification with official gazette, establish a Road Transport Corporation for the while or any part of the State under such name as may be specified in the notification. The respondent Corporation came to be established as 'public sector' undertaking in 1st June, 1962, styled as Madhya Pradesh State, Road Transport Corporation. Thereafter with the carving out of new State of Chattisgarh, the respondent Corporation is now Madhya Pradesh Road Transport Corporation. 6. The respondent Corporation came to be established as 'public sector' undertaking in 1st June, 1962, styled as Madhya Pradesh State, Road Transport Corporation. Thereafter with the carving out of new State of Chattisgarh, the respondent Corporation is now Madhya Pradesh Road Transport Corporation. 6. Service conditions of the employees in the respondent Corporation is governed by the Regulation framed by the Corporation in exercise of its power under Section 45 of the Act of 1950, which, stipulates: 45. Power to make regulations.-(1) A Corporation may, with the previous sanction of I [the State Government and by notification in the Official Gazette], make regulations, not inconsistent with this Act and the rules made thereunder, for the administration of the affairs of the Corporation. (2) In particular, and without prejudice to the generality of the foregoing power, such regulations may provide for all or any of the following matters, namely:- (a) the manner in which, and the purposes for which, persons may be associated with the 2[Board] under section 10; TC"(a) the manner in which, and the purposes for which, persons may be associated with the 2[Board] under section 10;" (b) the time and place of meetings of the 3 [Board] and the procedure to be followed in regard to transaction of business at such meetings; (c) the conditions of appointment and service and the scales of pay of officers and 4 [other employees of the Corporation other than the Managing Director, the Chief Accounts Officer and the Financial Adviser or, as the case may be, the Chief Accounts Officer-cum-Financial Adviser] (d) the issue of passes to the employees of the Corporation and other persons under section 19; (e) the grant of refund in respect of unused tickets and concessional passes under section 19.] 7. That in exercise of powers conferred by Section 45 of the Act of 1950, the respondent Corporation' framed Regulations, viz, 'Maclhya Pradesh State Road Transport Corporation Employees' Service Regulations, 1950 (referred to as Regulation 1950) and Madhya Pradesh State Road Transport Corporation Employees Conduct Discipline and Appeal Regulations, 1975 (referred to as Regulation 1975). 8. The Corporation being an establishment the provisions of Madhya Pradesh Industrial Employment (Standing Orders) Act, 1961 and the Rules made thereunder are applicable and governs the service condition of the employees of respondent Corporation. 9. 8. The Corporation being an establishment the provisions of Madhya Pradesh Industrial Employment (Standing Orders) Act, 1961 and the Rules made thereunder are applicable and governs the service condition of the employees of respondent Corporation. 9. Besides, the State Government is also empowered under Section 34 of the Act of 1950 to give instruction to the Corporation regarding service conditions of its employees. It says: 34. Direction by the State Government. (1) The State Government may, after consultation with a Corporation established by such Government, give to the Corporation general instructions to be followed by the Corporation, and such instructions may include directions relating to the recruitment, conditions of service and training of its employees, wages to be paid to the employees, reserves to be maintained by it and disposal of its profits or stocks. (2) In the exercise of its powers and performance of its duties under this Act, the Corporation shall not depart from any general instructions issued under sub-section (1) except with the previous permission of the State Government. 10. Regulation 59 of the Regulations 1950, makes a provision regarding age of Retirement. It stipulates: 11. Regulation 32(vii) of Regulation 1975 lays down compulsory retirement as one of the penalties which can be inflicted on an employee of the Corporation for good and sufficient reason and after following the procedure prescribed under Regulation 36. 12. Explanation (vi) appended with Regulation 32 provides for that, a compulsory retirement of an employee in accordance with the provisions relating to his superannuation or retirement shall not amount to penalty within the meaning of regulation 32. 13. Under the Act of 1961 Section 3(b) and Section 6(3) makes a provision regarding power of the State Government to frame Standard Standing Order and make it applicable by framing Rules under Section 21. 14. Sub-Section (b) of Section 3 defines 'Standard Standing Orders' which means "rules framed under Section 21 relating to matters set out in the Schedule". 15. Sub-Section (3) of Section 6 stipulates that "Standard Standing Orders' made or amendments certified under this Act shall provide for every matter set put in the Schedule". 16. Section 21 of the Act of 1961 empowers the State Government to make rules. It stipulates: 21. Power to make rules :- (1) The State Government may, by notification, make Rules to carry out the purposes of this Act. 16. Section 21 of the Act of 1961 empowers the State Government to make rules. It stipulates: 21. Power to make rules :- (1) The State Government may, by notification, make Rules to carry out the purposes of this Act. (2) In particular and without prejudice to the generality of the forgoing powers such rules may- (a) provides for additional matters to be included in the Schedule; (b) frame standard standing orders for the purpose of this Act and different standard standing orders may be framed for- (i) different clauses of undertakings: and (ii) different categories of employees: (c) lay down the procedure to be followed by the Certifying Officer, the Labour Court or the Industrial Court; (d) specify the fee which may be charged for furnishing copies of standing orders filed in the register under section 12; (e) provide for any other matter which is to be or may be prescribed. (3) The rules made under this section shall be subject to the condition of previous publication in the Gazette. 17. It is pertinent to note that the "Age of retirement" was added in the Schedule appended with the Act of 1961 by notification dated 19.10.1973 published in M.P. Gazette Part 4(ga) dated 2.11.1973 at page 770-771.The said addition paved the path for insertion of Clause 14-A in the Standard Standing Order. The Clause makes aprovision regarding retirement. It stipulates: 14-A: Retirement.: An employee shall retire from the service of the employer on the date he attains the age of 58 years. He may however, be retained in service by the employer after the date of attaining the age of 58 years if his services are necessary in the interest of the undertaking but he shall be not retained in service after the age of 60 years : Provided that nothing in this clause shall adversely affect the operation of the terms of any contract, agreement, settlement, or award on this subject, if the age of retirement is not less than 58 years: Provided further that before retiring an employee from the service in accordance with the provision contained in this clause, the employer shall give to the said employee atleast one month's intimation in writing of such retirement. However, failure to give such intimation will not entitle the employee to continue in service after attaining the age of retirement. However, failure to give such intimation will not entitle the employee to continue in service after attaining the age of retirement. On the employer's failure to give such intimation he shall be liable to pay to the employee concern one month's wages. [(1-A) Notwithstanding anything contained in Sub-Clause 1 the age of retirement for working journalist as defined in Section 2 (f) of the Working Journalist and other Newspapers Employees (Conditions of Service) and Miscellaneous Provisions Act, 1955 (No.45/1955) shall be 60 years.] (2) For the purpose of Clause (1) the age shall be reckoned by any of the following methods in order of priority; (i)- the date of birth as given by the employee at the time of employment accepted by the manager; (ii)- the date of birth as given in the Higher Secondary School certificate or equivalent examination certificate; (iii)- the certificate issued by the Local Authority of the place where the employee was born on the basis of the records maintained by such authority or certified copy of the entry in the birth and death register in which date of birth is mentioned; (iv)- the date of birth as declared by the employee in his declaration card for purpose of membership of the Employee's Provident Fund. (3) Notwithstanding anything contained in the foregoing, clause if any dispute' arises regarding the date of birth intimated at the time of employment or declared in the declaration card for the purpose of membership of the employee's Provident Fund, as the case may be, then the date of birth shall be determined on the basis of School Leaving Certificate and in its absence, the date of birth determined by a Registered Medical Practitioner, not below the rank of Civil Surgeon, shall be considered as final but any such dispute shall not be entertained within the period of six months before the date of retirement. 18. The amendment in the Standard Standing Order was after taking recourse to the procedure prescribed under Section 6 and 8 of the Act of 1961. 19. Thus as a matter of general policy the Corporation cannot retire its employee until he completes the 'age of retirement'. Except by way of punishment as provided under Regulation 32 of Regulation 1975. 20. The amendment in the Standard Standing Order was after taking recourse to the procedure prescribed under Section 6 and 8 of the Act of 1961. 19. Thus as a matter of general policy the Corporation cannot retire its employee until he completes the 'age of retirement'. Except by way of punishment as provided under Regulation 32 of Regulation 1975. 20. The respondent Corporation, however, taking recourse to the direction dated 13.8.2009 and 31.8.2009 issued by the State Government in purported exercise of power under Section 34 of the Act of 1950 adopted the circular No.C-3-24/2000/3/1 dated 22.8.2000 which lays down the procedure to be followed when a Government Servant is to be compulsory retired on his completion of 20 years of service or on attaining 50 years of age either under Fundamental Rule 56 or under Rule 42 of the M.P. Civil Service (Pension) Rules, 1976. That in accordance therewith, the employees who are the petitioners before this Court are compulsory retired. 21. The reasons for mass compulsory retirement are as stated in the Return by the respondent Corporation. 22. It is stated that after initial years of sustenance, Corporation started running into losses and ever since 1994-95 it has been sustaining itself on the basis of financial grants either by Central or the State Government. The accumulated loss as on 31.3.2004 was Rs.735 Crores with outstanding being Rs.1033.68 Crores. It is urged that on 18.2.05, the Council of Ministers of State of M.P. resolved to wind up the Corporation. Consequent whereof the Board in its 10th meeting on 19.5.2005 floated a Voluntary Retirement Scheme 2005. It is urged that in 18th Board Meeting the Corporation floated a Voluntary Retirement Scheme 2010. Respondent further state that in Pursuance to the voluntary retirement scheme large number of employees opted as a result whereof the strength which was 10800 at the time of introduction remained 300 as on date. It is urged that all the five workshops has been closed. Subsequently, the depots and divisional officers have also been closed and the corporation does not own any buses. It is urged that income of Corporation is 'nil' with effect from 30.9.10. 23. It appears from the pleadings of respondent Corporation that the employees who did not opt under the Voluntary Retirement Scheme 2005 or 2010, mode of Compulsory retirement was adhered to board out the remaining employees. 24. It is urged that income of Corporation is 'nil' with effect from 30.9.10. 23. It appears from the pleadings of respondent Corporation that the employees who did not opt under the Voluntary Retirement Scheme 2005 or 2010, mode of Compulsory retirement was adhered to board out the remaining employees. 24. It was informed during course of hearing that the corporation took recourse to Section 25.0 of Industrial Dispute Act 1947 seeking closure which as per respondents still remains in vogue and the decision of Union of India is under challenge before this Court. Be that as it may. 25. The purpose for adverting to the fact regarding closure is that when the corporation has taken recourse to the provisions of Section 25.0 of Act of 1947, they could have very well invoked other provisions as they appear under Chapter VB of Act of 1947 like Section 25 N, if they are to wind up the Corporation. 26. It is not that the respondent Corporation cannot take recourse to premature retirement being one of the mode of compulsory retirement which can be on following terms as laid down in State of Gujrat v. Umedbhai M. Patel: AIR 2001 SC 1109 - The law relating to compulsory retirement has now crystallized into definite principles, which could be broadly summarised thus: (i) Whenever the services of a public servant are no longer useful to the general administration, the officer can be compulsorily retired for the sake of public interest. (ii) Ordinarily, the order of compulsory retirement is not to be treated as a punishment coming under Article 311 of the Constitution. (iii) For better administration, it is necessary to chop off dead-wood, but the order of compulsory retirement can be passed after having due regard to the entire service record of the officer. (iv) Any adverse entries made in the confidential record shall be taken note of and be given due weightage in passing such order. (v) Even un-communicated entries in the confidential record can also be taken into consideration. (vi) The order of compulsory retirement shall not be passed as a short cut to avoid departmental enquiry when such course is more desirable. (vii) If the officer was given a promotion despite adverse entries made in the confidential record, that is a fact in favour of the officer. (viii) Compulsory retirement shall not be imposed as a punitive measure. 27. (vii) If the officer was given a promotion despite adverse entries made in the confidential record, that is a fact in favour of the officer. (viii) Compulsory retirement shall not be imposed as a punitive measure. 27. The question however, is whether, the Corporation could have taken shelter of State Government direction, by adopting a circular of the State Government regarding premature retirement, without taking recourse to cause an amendment in the Regulations 1950 or the Standard Standing Orders, in the manner provided under the Act of 1961 and the Rules 1963 framed thereunder. 28. No doubt, the direction by the State Government under Section 34 are imperative in nature. In Mysore State Road Transport Corporation v. Gopinath Gundachar Char: AIR 1968 SC 464 , it was held: 3.........If the State Government issues any directions under S.34 relating to the recruitment and conditions of service of the employees, the Corporation must obey those directions. 29. In General Manager Mysore State Road Transport Corporation v. Devraj Urs and another: AIR 1976 SC 1027 it was observed: 13. It would thus be seen that until regulations are made with the previous sanction of the State Government the directions given under Section 34 in respect of the conditions of service has got the force of law. 30. But where there is a special law like the Act of 1961 which governs the undertakings, imperative it is for such undertaking to have first install the provisions either in the existing Regulations or the Standard Standing Order as the case may be, in accordance with the procedure as laid down in the Act of 1961. (Section 6 and 8). 31. The Act of 1961 is a special law being enacted by the State Government in exercise of its exclusive power to enact a law regulating industrial relations and resolutions of labour dispute, will have precedence over the General Law, in the present, the Act of 1950, need no elaboration as has been settled at rest with the decision in M.P. Vidyut Karmachari Sangh v. M.P. Electricity Board (2004) 9 SCC 755 wherein it is held: 30. This brings us to the question as regard the effect of the 1961 Act. This brings us to the question as regard the effect of the 1961 Act. In terms of Section 2, the 1961 Act, applies to every undertaking wherein the number of employees on any day during the twelve months preceding or on the day the said Act came into force or any day thereafter was or is more than twenty and such other class or classes of undertakings as the State Government may, from time to time, by notification, specify in this behalf. The undertaking of the Board indisputably was inexistence in 1961. Per se, therefore, the provisions of the 1961 Act shall apply to the undertakings of the Board. Sub-Section (2) of Section 2 of the 1961 Act makes an exception to the applicability of the Act stating that nothing therein shall apply to the employees of an undertaking to whom the Fundamental and Supplementary Rules, Civil Services (Classification, Control and Appeal) Rules, Civil Services (Temporary Service) Rules, Revised Leave Rules, Civil Service Regulations or any other rules or regulations that may be notified in this behalf the State Government in the official gazette apply. For excluding the operation of the 1961 Act, it is imperative that an appropriate notification in terms of Section 2(2) of the 1961 Act is issued. 31. The Board adopted Fundamental and Supplementary Rules which per se were not applicable to the employees of their undertaking. They were adopted by the Board. The provisions of Fundamental and Supplementary Rules to the extent it was made applicable, having regard to the provisions contained in Section 79 (c) would, thus, be deemed to be the regulations governing the terms and conditions of the employees of the Board. The requisite notification under Section 2(2) of the 1966 Act was, thus, required to be issued by the State Government. 32. It is not in dispute that the State Government has not issued any notification in terms of Section 2(2) of the 1961 Act and in that view of the matter the provisions thereof shall apply to the employees of the State. The 1961 Act is a special law whereas the regulations framed by the Board under Section 79 (c) are general provisions. The maxim 'generalia specialibus non derogant' would, thus, be applicable in this case. [See D.R. Yadav and Another Vs. R.K. Singh and Another, (2003) 7 SCC 110 and Indian Handicrafts Emporium and Others Vs. The 1961 Act is a special law whereas the regulations framed by the Board under Section 79 (c) are general provisions. The maxim 'generalia specialibus non derogant' would, thus, be applicable in this case. [See D.R. Yadav and Another Vs. R.K. Singh and Another, (2003) 7 SCC 110 and Indian Handicrafts Emporium and Others Vs. Union of India and Others. 33. The question need not detain us long in view of a 3-Judge Bench decision of this Court in Hari Shankar Jain (supra). This Court therein in no uncertain terms held that the provisions of the Standing Order Act are special laws in regard to the matters enumerated in the Schedule and, thus, the regulations made by the Electricity Board with respect to any of those matters are of no effect unless the regulations are either notified by the Government or certified by the certifying officer, holding: 18 In regard to matters in respect of which regulations made by the Board have not been notified by the Governor or in respect of which no regulations have been made by the Board, the Industrial Employment (Standing Orders) Act shall continue to apply. In the present case the regulation made by the Board with regard to age of superannuation having been duly notified by the Government, the regulation shall have effect notwithstanding the fact that it is a matter which could be the subject matter of Standing Orders under the Industrial Employment (Standing Orders) Act... 32. A Full Bench of this Court in Madhya Pradesh State Road Transport Corporation v. Heeralal Ochhelal and others: 1980 MPLJ 8 observed: 10-The Road Transport Corporation Act, 1950 under which the petitioner Corporation is established is an Act to provide for incorporation and regulation of Road Transport Corporations. Section 45(2) (c) of the Act authorities the Corporation to make regulations to provide for the conditions of appointment and service and the scales of pay of officers and servants of the Corporation. The Act in so far it provides for establishment of Road Transport Corporations is a special Act. But the power conferred under section 45(2) (c) on the Corporation to make regulations laying down 'conditions of service is a general provision which is often found in statutes creating statutory Corporations. The Act in so far it provides for establishment of Road Transport Corporations is a special Act. But the power conferred under section 45(2) (c) on the Corporation to make regulations laying down 'conditions of service is a general provision which is often found in statutes creating statutory Corporations. A general provision of this nature is not intended to affect a law designed to lay down conditions of employment for a special class of employees such as industrial workers governed by the Industrial Employment. (Standing Orders) Act, 1946, which is an Act to require employers in industrial establishments formally to define conditions of employment under them, or the corresponding Madhya Pradesh Act. i.e; the Madhya Pradesh Industrial Employment (Standing Orders) Act, 1961. The Standing Orders Acts are special laws dealing with conditions of employment of industrial workers and so on principles of construction their provisions prevail over the general provision contained in Section 45(2)(c) of the Road Transport Corporation Act The regulations made, therefore, cannot have any effect on matters contained in the Schedule to the Standing Orders Acts on which Standing Orders can be made under those Acts for industrial workers. The regulations can, however, be operative even in respect of industrial workers on matters not included in the schedule to the Standing Orders Acts. The only method by which the regulations can be applied to matter contained in the schedule to the Standing Orders Acts is either to notify. them under section 13 -B of the Central Standing Orders Act or Section 2(2) of the Madhya Pradesh Act, as the case may be, or to have them certified as standing orders in accordance with the procedure laid down in those Acts. 33. In the case at hand the determination of service of an employee of the Corporation by way of premature retirement, except, by way of punishment, having not. been provided either in the Regulations of 1950, nor in the Standard Standing Orders, the action of the respondents Corporation in premature retiring its employees in public interest being not in consonance with the provisions contained in the Act of 1961 cannot be given the stamp of approval. 34. been provided either in the Regulations of 1950, nor in the Standard Standing Orders, the action of the respondents Corporation in premature retiring its employees in public interest being not in consonance with the provisions contained in the Act of 1961 cannot be given the stamp of approval. 34. Since the very action of the respondent Corporation in retiring its employees prematurely by taking recourse to the circular dated 22.8.2001 issued by the State Government is held to be without any authority/sanction of law, as such is void ab-initio the respective merit of the matter of each individual employee is not gone into. 35. The petitions are thus, allowed to extent above. The petitioners would be entitled for consequential benefit except the backwages. As apparent, from the facts on record that the respondent Corporation is going through its worst financial crisis because of operational losses and because of its being deregulated by the State Government. 36. In the result petitions succeeds to the extent above. No costs.