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2011 DIGILAW 3560 (MAD)

Tamizhaga Civil Supplies Corporation Thozhilalar Sangam, represented by its State General Secretary, A. K. Elumalai v. State of Tamil Nadu rep. by Principal Secretary to Government Department of Co-operation, Food and Consumer Protection, Fort St. George

2011-08-04

K.CHANDRU

body2011
JUDGMENT :- 1. The petitioner is a trade union. In this writ petition, they have come forward to challenge an order passed by the first respondent/State Government dated 17.9.2009. By the impugned order, the State Government declined to accept the demand of the petitioner/Union for creating a pension scheme for the employees working in the second respondent/Tamil Nadu Civil Supplies Corporation. Even that order came to be passed pursuant to the earlier direction given by this Court in W.P.No.11304 of 2009, dated 24.6.2009, wherein and by which the representation of the petitioner/Union was directed to be considered by the first respondent. 2. The writ petition, which originally came up for admission on 8.10.2009, was adjourned several times and finally admitted on 21.10.2009. On notice from this Court, the first respondent has filed a counter affidavit dated 22.7.2011 and the second respondent has also filed an affidavit dated 28.3.2011 Earlier, the petitioner filed M.P.No.3 of 2010 seeking permission to raise additional grounds and that was also allowed by this Court on 22.9.2010. The petitioner/Union has also filed a reply dated (Nil) July, 2011. 3. Heard the arguments of Mr.R.Krishnamurthy, learned Senior Counsel appearing for M/s.Sai, Bharath and Ilan, Mr.V.Subbiah, learned Special Government Pleader appearing for the first respondent and Mr.V.Selvanayagam, learned counsel for the second respondent. 4.1. It is the case of the petitioner/Union that they are a registered trade union. The second respondent/Civil Supplies Corporation is in-charge of distribution and procurement of paddy. They are also procuring paddy directly from the farmers and after hulling the same through private mills and also in the modern rice mills run by them, they are distributing those grains to all Taluk godowns, which in turn are supplied to the Civil Supplies Department and co-operative ration shops. The Corporation is playing a vital role in various welfare schemes of the Government, including the distribution of subsidized rice and essential commodities through fair price shops. The employees of the Corporation are nowhere different from the government servants and the duties and responsibilities entrusted to them are more than that of a government servant, but the service conditions of the government servants are not extended to them. While the government servants are enjoying the benefit of a pension scheme, the same was not extended to the employees of the second respondent/Corporation. 4.2. While the government servants are enjoying the benefit of a pension scheme, the same was not extended to the employees of the second respondent/Corporation. 4.2. It is also stated that ever since the second respondent/ Corporation was formed in the year 1972, the employees were making requests for introduction of a pension scheme and during the year 2011, the then Hon'ble Minister for Food made a statement on the floor of the Legislative Assembly that a pension proposal is being considered, and once again a similar statement was made during April, 2008 on the floor of the Assembly. The petitioner/Union sent a representation to the Chief Minister's Grievance Cell, for which a reply was directed to be sent by the General Manager of the second respondent and accordingly, a reply was sent on 24.10.2008. 4.3. It is also the case of the petitioner/Union that, on making enquiries and getting replies under the Right to Information Act, they have found out that the Chennai Metropolitan Water Supply and Sewerage Board is paying pension to its employees. Likewise, the Tamil Nadu Text Book Society and various Transport Corporations, Tamil Nadu Slum Clearance Board, Tamil Nadu Water Supply and Drainage Board, Tamil Nadu Electricity Board, and Tamil Nadu Housing Board are paying pension to their employees and therefore, not only the Government, but also the various public sector undertakings are paying pension and there is no reason why the employees of the Civil Supplies Corporation stood excluded from such benefits. In essence, the respondents should not adopt different yardstick and therefore, it was prayed that they should be given the benefit of pension. 4.4. In the petition for additional grounds, they had stated that the second respondent, who was originally registered as a Company under the Companies Act, had changed its character and had sought for recognition as a charitable organization under Section 25 of the Companies Act and as the second respondent had become a body of the first respondent, the pension scheme as applicable to government servants should be made applicable. The contention that since they are not a profit making organization they cannot give pension also cannot be accepted, because by virtue of registration as charitable organization under Section 25 of the Companies Act, they are not expected to make profit. 5.1. The contention that since they are not a profit making organization they cannot give pension also cannot be accepted, because by virtue of registration as charitable organization under Section 25 of the Companies Act, they are not expected to make profit. 5.1. In response to these allegations, the first respondent had stated that the petitioner/Union is a minority union having the following of 2.27% in the election held during November, 2009 and it does not have any representative capacity to speak on behalf of all the workers of the Corporation. The second respondent is a service oriented organization without any profit motive. While the Government is having its own pension scheme, the second respondent is covered by the provisions of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 and as part of the provident fund, a pension scheme has also been introduced with effect from 16.11.1995. 5.2. It is stated that the petitioner/Union cannot compel the Government to frame a pension scheme for the employees of the second respondent/Corporation in the absence of any statutory right. The Government undertakings mentioned by the petitioner are not covered by the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, as they themselves are having a general provident fund scheme. If the demand of the petitioner/Union was accepted, it will have a cascading effect and the Government will have to cover 47 other public sector undertakings and when a direction was given by this Court to consider the petitioner's representation, after undertaking a study of all relevant aspects, the Government has negatived the request of the petitioner/ Union. 5.3. It is also stated that from the year 2003, the government servants have been made ineligible for getting pension as a matter of right. By G.O.No.259, Finance (Pension) Department, dated 6.8.2003, the Government has introduced a new Contributory Pension Scheme and made it applicable to government servants, who are recruited on or after 1.4.2003. 5.4. It is further stated that the second respondent does not have sufficient funds to extend the benefits of pension and the example referred to, viz., Tamil Nadu Electricity Board, is inappropriate and the Tamil Nadu Electricity Board is paying pension out of its own funds. Even though the employees of the Transport Corporation got the benefit of pension, the Government is struggling to get income tax clearance in respect of the said pension scheme. Even though the employees of the Transport Corporation got the benefit of pension, the Government is struggling to get income tax clearance in respect of the said pension scheme. Further, the employees of the Corporation having been covered by the provisions of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, are also drawing pension under the pension scheme framed under the said Act. 6. The second respondent, in their individual counter affidavit, had stated that the petitioner/Union, in the absence of any statutory right, cannot seek for such direction and the Corporation does not have sufficient funds to extend the benefit of pension to the employees. 7. In the reply affidavit filed by the petitioner/Union, it was stated that the duties performed by the employees of the second respondent/ Corporation are commendable and all the welfare schemes are executed through the Corporation. While the Government was proceeding to distribute free fan, mixie and grinder to the people and it is sought to be executed by the aegis of the Corporation, only on the question of pension they are expressing financial difficulties. 8. In the additional typed set filed by the petitioner, they also enclosed the schemes for pension applicable in other public sector undertakings. 9.1. Mr.R.Krishnamurthy, learned Senior Counsel referred to the judgment of the Supreme Court in Randhir Singh v. Union of India and others, [1982] 1 SCC 618 for the purpose of contending that the principle of equal pay for equal work is not an abstract doctrine, but one of substance and the cases of unequal scales of pay based on no classification or irrational classification is a breach of such principle. In that case, the Supreme Court directed that the pay scales of the Driver-Constables of the Delhi Police Force should be made on a par with the Drivers of the Railway Protection Force. 9.2. The learned Senior Counsel also referred to the judgment of the Supreme Court in D.S.Nakara and others v. Union of India, [1983] 1 SCC 305 for contending that pension is neither a bounty nor a matter of grace depending upon the sweet will of the employer, nor an ex gratia payment and it is a payment for the past service rendered. It is a social welfare measure rendering socio-economic justice to those who in the heyday of their life ceaselessly toiled for the employer on an assurance that in their old age they would not be left in lurch. Pension as a retirement benefit is in consonance with and in furtherance of the goals of the Constitution. It creates a vested right and is governed by the statutory rules. 9.3. He also referred to the judgment of the Supreme Court in Jacob M.Puthuparambil and others v. Kerala Water Authority and others, [1991] 1 SCC 28 for contending that the preamble to the Constitution promises socio-economic justice and the Directive Principles fix the socio-economic goals. The Directive Principles of State Policy reflect the hopes and aspirations of the people. Though the provisions of Part IV of the Constitution of India are not enforceable by any court, the principles laid down therein are nevertheless fundamental in the governance of the country and the State is under an obligation to apply them in making laws. Therefore, whenever the State is required to make laws it must do so consistently with these principles with a view to securing social and economic freedom so essential for the establishment of an egalitarian society. 9.4. The learned Senior Counsel finally referred to the judgment of the Supreme Court in State of Maharashtra v. Manubhai Pragaji Vashi and others, [1995] 5 SCC 730 for contending that the State must discharge the burden of proof for justifying the differential treatment between governmental agencies. It is stated that in that case the Supreme Court frowned upon the Government for continuing the disparity between the government colleges and non-government colleges and it was held that singling out the non-teaching staff of the non-government colleges would amount to hostile treatment. In that case, the Supreme Court went to the extent of giving a direction even to enforce a right flowing from the Directive Principles of State Policy and held that when there is an inaction on the part of the Executive, the Judiciary must intervene and in a fit case, the Court can direct the Executive to carry out the Directive Principles of State Policy. It was further stated that the State cannot whittle down by pleading paucity of funds as a ground for denying the right of the employees. 9.5. It was further stated that the State cannot whittle down by pleading paucity of funds as a ground for denying the right of the employees. 9.5. He also referred to an unreported judgment of this Court in Tamilnadu Warehousing Corporation Employees Union and others v. The State of Tamilnadu, rep. by Secretary to Government, Food and Consumer Protection Department and others (W.P.Nos.28269 and 34640 of 2007 and 24409 of 2008, dated 24.1.2011). In that case, when the employees of the Tamil Nadu Warehousing Corporation and their trade union sought a direction to implement a pension scheme, this Court directed the respondent to proceed with the scheme for pension, but it was made clear that under the said scheme, the Government shall not be financially made liable to bear the cost. It is not clear as to how the said judgment has any relevance to the facts on hand. 10. Per contra, the counsel for the first respondent/State produced a copy of the government order in G.O.No.259, Finance (Pension) Department, dated 6.8.2003, wherein the Government had introduced a Contributory Pension Scheme and for that purpose, the Tamil Nadu Pension Rules have also been amended. It was stated that the Government employees, who were recruited on or after 1.4.2003, should become members of the scheme and must pay 10% of basic pay and dearness allowance from the salary for the contributory pension scheme. 11. In the present case, the petitioner/Union by referring to the existence of such scheme in other public sector undertakings cannot seek a writ in the nature of Mandamus for granting direction to the State Government to formulate a pension scheme for the employees of the Civil Supplies Corporation. As already pointed out by the petitioner themselves, the second respondent is a Corporation with its own name and seal and is an autonomous body and it has to decide whether it has got the financial ability to introduce a pension scheme. On the contrary, the second respondent has pleaded lack of financial resources. They had also stated that the employees of the Corporation are already covered by the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 and apart from the provident fund, they are also enjoying the pension scheme framed under the said Act. On the contrary, the second respondent has pleaded lack of financial resources. They had also stated that the employees of the Corporation are already covered by the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 and apart from the provident fund, they are also enjoying the pension scheme framed under the said Act. The State Government had also stated that they have got no power to finance any such scheme and even for government employees they had converted the scheme to one of contributory pension scheme. It is in the light of this, the request of the petitioner will have to be considered. 12. With reference to the first contention based upon Randhir Singh case, supra, it must be noted that the said judgment came to be considered subsequently and was distinguished by the Supreme Court. The Supreme Court in S.C.Chandra and others v. State of Jharkhand and others, [2007] 8 SCC 279, in paragraphs [24] to [26], observed as follows: "24. The principle of equal pay for equal work was propounded by this Court in certain decisions in the 1980s e.g. Dhirendra Chamoli v. State of U.P., [1986] 1 SCC 637, Surinder Singh v. Engineer-in-Chief, CPWD, [1986] 1 SCC 639, Randhir Singh v. Union of India, [1982] 1 SCC 618, etc. This was done by applying Articles 14 and 39(d) of the Constitution. Thus, in Dhirendra Chamoli case this Court granted to the casual, daily-rated employees the same pay scale as regular employees. 25. It appears that subsequently it was realised that the application of the principle of equal pay for equal work was creating havoc. All over India different groups were claiming parity in pay with other groups e.g. government employees of one State were claiming parity with government employees of another State. 26. Fixation of pay scale is a delicate mechanism which requires various considerations including financial capacity, responsibility, educational qualification, mode of appointment, etc. and it has a cascading effect. Hence, in subsequent decisions of this Court the principle of equal pay for equal work has been considerably watered down, and it has hardly ever been applied by this Court in recent years." In the same judgment, Markandey Katju,J., in his own supplementing opinion, held that the grant of pay scale is a purely executive function and the Court should not interfere with the same. He also reiterated the well known principle of separation of powers and in paragraphs [33] to [35], it was held as follows: "33. It may be mentioned that granting pay scales is a purely executive function and hence the court should not interfere with the same. It may have a cascading effect creating all kinds of problems for the Government and authorities. Hence, the court should exercise judicial restraint and not interfere in such executive function vide Indian Drugs & Pharmaceuticals Ltd. v. Workmen, [2007] 1 SCC 408. 34. There is broad separation of powers under the Constitution, and the judiciary should not ordinarily encroach into the executive or legislative domain. The theory of separation of powers, first propounded by the French philosopher Montesquieu in his book The Spirit of Laws still broadly holds the field in India today. Thus, in Asif Hameed v. State of J&K, 1989 Supp (2) SCC 364 a three-Judge Bench of this Court observed (vide paras 17 to 19): (SCC pp. 373-74) “17. Before adverting to the controversy directly involved in these appeals we may have a fresh look at the inter se functioning of the three organs of democracy under our Constitution. Although the doctrine of separation of powers has not been recognised under the Constitution in its absolute rigidity but the Constitution makers have meticulously defined the functions of various organs of the State. Legislature, executive and judiciary have to function within their own spheres demarcated under the Constitution. No organ can usurp the functions assigned to another. The Constitution trusts to the judgment of these organs to function and exercise their discretion by strictly following the procedure prescribed therein. The functioning of democracy depends upon the strength and independence of each of its organs. Legislature and executive, the two facets of people's will, they have all the powers including that of finance. Judiciary has no power over sword or the purse nonetheless it has power to ensure that the aforesaid two main organs of State function within the constitutional limits. It is the sentinel of democracy. Judicial review is a powerful weapon to restrain unconstitutional exercise of power by the legislature and executive. The expanding horizon of judicial review has taken in its fold the concept of social and economic justice. It is the sentinel of democracy. Judicial review is a powerful weapon to restrain unconstitutional exercise of power by the legislature and executive. The expanding horizon of judicial review has taken in its fold the concept of social and economic justice. While exercise of powers by the legislature and executive is subject to judicial restraint, the only check on our own exercise of power is the self-imposed discipline of judicial restraint. 18. Frankfurter, J. of the U.S. Supreme Court dissenting in the controversial expatriation case of Trop v. Dulles, 356 US 86 (1958) observed as under: (US pp. 119-20) “All power is, in Madison's phrase, ‘of an encroaching nature’. ‘Judicial power is not immune against this human weakness. It also must be on guard against encroaching beyond its proper bounds, and not the less so since the only restraint upon it is self-restraint. “ Rigorous observance of the difference between limits of power and wise exercise of power-between questions of authority and questions of prudence-requires the most alert appreciation of this decisive but subtle relationship of two concepts that too easily coalesce. No less does it require a disciplined will to adhere to the difference. It is not easy to stand aloof and allow want of wisdom to prevail, to disregard one's own strongly held view of what is wise in the conduct of affairs. But it is not the business of this Court to pronounce policy. It must observe a fastidious regard for limitations on its own power, and this precludes the Court's giving effect to its own notions of what is wise or politic. That self-restraint is of the essence in the observance of the judicial oath, for the Constitution has not authorised the judges to sit in judgment on the wisdom of what Congress and the Executive Branch do.” 19. When a State action is challenged, the function of the court is to examine the action in accordance with law and to determine whether the legislature or the executive has acted within the powers and functions assigned under the Constitution and if not, the court must strike down the action. While doing so the court must remain within its self-imposed limits. The court sits in judgment on the action of a coordinate branch of the Government. While exercising power of judicial review of administrative action, the court is not an appellate authority. While doing so the court must remain within its self-imposed limits. The court sits in judgment on the action of a coordinate branch of the Government. While exercising power of judicial review of administrative action, the court is not an appellate authority. The Constitution does not permit the court to direct or advise the executive in matters of policy or to sermonise qua any matter which under the Constitution lies within the sphere of legislature or executive, provided these authorities do not transgress their constitutional limits or statutory powers.” (emphasis supplied) 35. In our opinion fixing pay scales by courts by applying the principle of equal pay for equal work upsets the high constitutional principle of separation of powers between the three organs of the State. Realising this, this Court has in recent years avoided applying the principle of equal pay for equal work, unless there is complete and wholesale identity between the two groups (and there too the matter should be sent for examination by an Expert Committee appointed by the Government instead of the court itself granting higher pay)." 13. With reference to the second submission based upon D.S.Nakara case, supra, it must be noted that D.S.Nakara case relates to discrimination between class of pensioners. The ratio of the said judgment came to be considered subsequently by another Constitutional Bench in Indian Ex-Services League v. Union of India, [1991] 2 SCC 104. In paragraph [14], it was observed as follows: "14. D.S.Nakara and others v. Union of India, [1983] 1 SCC 305 decision came up for consideration before another Constitution Bench recently in Krishena Kumar v. Union of India, [1990] 4 SCC 207. The petitioners in that case were retired Railway employees who were covered by or opted for the Railway Contributory Provident Fund Scheme. It was held that PF retirees and pension retirees constitute different classes and it was never held in Nakara case that pension retirees and PF retirees formed a homogeneous class, even though pension retirees alone did constitute a homogeneous class within which any further classification for the purpose of a liberalised pension scheme was impermissible. It was pointed out that in Nakara case, it was never required to be decided that all the retirees for all purposes formed one class and no further classification was permissible. It was pointed out that in Nakara case, it was never required to be decided that all the retirees for all purposes formed one class and no further classification was permissible. We have referred to this decision merely to indicate that another Constitution Bench of this Court also has read Nakara case decision as one of limited application and there is no scope for enlarging the ambit of that decision to cover all claims made by the pension retirees or a demand for an identical amount of pension to every retiree from the same rank irrespective of the date of retirement, even though the reckonable emoluments for the purpose of computation of their pension be different." 14. Merely because other public sector undertakings are extending the benefit cannot be itself a ground to consider the case of the petitioner/Union. The petitioner, in the information obtained under the Right to Information Act, found that for the year 2005-2006 out of 48 public sector units, 32 units have made profits and 16 are loss making units. Significantly, it is found that the second respondent/Civil Supplies Corporation is one of the loss making units. 15. Further, it has been stated that the petitioner/Union is a non-representative union, representing a very miniscule minority of the employees of the second respondent/Corporation. Even if any industrial dispute is raised by the petitioner/Union with reference to the demand for pension, they will have to establish their representative capacity before the appropriate Tribunal and only then the Tribunal can examine the case for any pensionary benefit being extended to the workmen. Even in such a dispute the union will have to establish that the Corporation has got the financial stability to introduce a pension scheme and that such a scheme is available in the same region and in similar industries. In view of the above, there is no case made out to entertain a writ petition. Hence, the writ petition stands dismissed. However, there will be no order as to cost.